The client list of adviser Patrick Kinsella - former provincial Liberal election campign co-chair - is impressive. So was his dismissal of B.C.'s lobbyist registry as, ultimately, a failure.
Sean Holman has identified another interesting client .
Once you've read the piece, search Holman's site on Patrick Kinsella and read the other posts.
Friday, February 20, 2009
Budget looks more hopeful than credible
The more time I spend with the government's numbers, the more improbable the budget looks.
The plan - especially in years two and three - looks to rely heavily on optimism. The claim that budgets will be balanced by the 2011 fiscal year, after small two deficits, is shaky at best.
Unless, that is, the government is prepared to do some heavy slashing and burning in programs and services.
It's a touchy subject for both main parties. In 1996, the NDP tabled a budget that claimed two successive surpluses - in the fiscal year just about to end and the new budget year.
The claims were false, based largely on unrealistic revenue forecasts. A lot of Liberals believe the NDP stole that election. It still rankles.
Now, on the eve of another election, the Liberals are projecting a skinny surplus this year and two years of small deficits before a legislated return to balanced budgets.
The surplus this year should be attainable. There are less than two months until the March 31 fiscal year-end and a big contingency fund.
And the government might be able to hit its projected $495-million deficit in the coming year.
But there are questions even about that.
Finance Minister Colin Hansen has abandoned one of the symbols of Liberal prudence. Budgets have included "forecast allowances" of about $800 million - a cushion against surprises.
There is no forecast allowance for the next three years. If something goes wrong, spending must be cut or deficits will rise.
And spending cuts would be difficult.
The three-year-plan sees overall expenses rising by about two per cent on average.
But that's mostly health spending. Strip away health and education, and government spending is to be cut almost four per cent this year, three per cent next and then frozen at the lower level in the third year, resulting in a barely balanced budget.
Which, as you run options through a spreadsheet, might seem perfectly possible.
But the Environment Ministry, for example, faces a five-per-cent budget cut this year, and then another one per cent cut in each of the next two years. By 2011, the ministry responsible for environmental protection and climate change action, will have seven per cent less resources than it does today.
Attorney General Wally Oppal has been batted around in the legislature in the days since the budget.
With good reason. His budget calls for cuts to prosecutors and court services, at a time when gangs are doing their best to act out Scarface on Vancouver streets. The 767 people working on prosecution services are to be cut to 661 over the next three years.
Pressed in a scrum, the lightly prepared Oppal said the budget numbers for the last two years of the three-year plan were flexible. If the ministry needed more money, it would spend it.
But that means either cuts somewhere else or a deficit instead of the promised balanced budget in 2011.
And there really isn't anywhere else to cut. The Ministry of Children and Families gets increase of one per cent, one per cent and zero. It plans to cut almost 200 positions in child and family development work.
There's less money for housing, forests, tourism, at a time when needs are acute.
The budget documents even highlight the problems.
The finance deputy minister notes that the budget includes $250 million more in spending cuts by 2011/12 that have yet to be identified.
It's weird, really. Instead of deficits of $495 million and $245 million, big risks and harsh cuts, the government could have gone with $1.2-billion deficits each year and put off a balanced budget for an extra year.
The debt increase wouldn't have been significant, especially if the government's prediction of a quick return to growth is accurate.
And services and the Liberals' credibility would have both been protected.
Footnote: Politically, the budget makes no sense. If Stephen Harper has embraced five years of deficits, surely three years in B.C. would be acceptable. And why raise the spectre of a hidden agenda of cuts to programs and services?
The plan - especially in years two and three - looks to rely heavily on optimism. The claim that budgets will be balanced by the 2011 fiscal year, after small two deficits, is shaky at best.
Unless, that is, the government is prepared to do some heavy slashing and burning in programs and services.
It's a touchy subject for both main parties. In 1996, the NDP tabled a budget that claimed two successive surpluses - in the fiscal year just about to end and the new budget year.
The claims were false, based largely on unrealistic revenue forecasts. A lot of Liberals believe the NDP stole that election. It still rankles.
Now, on the eve of another election, the Liberals are projecting a skinny surplus this year and two years of small deficits before a legislated return to balanced budgets.
The surplus this year should be attainable. There are less than two months until the March 31 fiscal year-end and a big contingency fund.
And the government might be able to hit its projected $495-million deficit in the coming year.
But there are questions even about that.
Finance Minister Colin Hansen has abandoned one of the symbols of Liberal prudence. Budgets have included "forecast allowances" of about $800 million - a cushion against surprises.
There is no forecast allowance for the next three years. If something goes wrong, spending must be cut or deficits will rise.
And spending cuts would be difficult.
The three-year-plan sees overall expenses rising by about two per cent on average.
But that's mostly health spending. Strip away health and education, and government spending is to be cut almost four per cent this year, three per cent next and then frozen at the lower level in the third year, resulting in a barely balanced budget.
Which, as you run options through a spreadsheet, might seem perfectly possible.
But the Environment Ministry, for example, faces a five-per-cent budget cut this year, and then another one per cent cut in each of the next two years. By 2011, the ministry responsible for environmental protection and climate change action, will have seven per cent less resources than it does today.
Attorney General Wally Oppal has been batted around in the legislature in the days since the budget.
With good reason. His budget calls for cuts to prosecutors and court services, at a time when gangs are doing their best to act out Scarface on Vancouver streets. The 767 people working on prosecution services are to be cut to 661 over the next three years.
Pressed in a scrum, the lightly prepared Oppal said the budget numbers for the last two years of the three-year plan were flexible. If the ministry needed more money, it would spend it.
But that means either cuts somewhere else or a deficit instead of the promised balanced budget in 2011.
And there really isn't anywhere else to cut. The Ministry of Children and Families gets increase of one per cent, one per cent and zero. It plans to cut almost 200 positions in child and family development work.
There's less money for housing, forests, tourism, at a time when needs are acute.
The budget documents even highlight the problems.
The finance deputy minister notes that the budget includes $250 million more in spending cuts by 2011/12 that have yet to be identified.
It's weird, really. Instead of deficits of $495 million and $245 million, big risks and harsh cuts, the government could have gone with $1.2-billion deficits each year and put off a balanced budget for an extra year.
The debt increase wouldn't have been significant, especially if the government's prediction of a quick return to growth is accurate.
And services and the Liberals' credibility would have both been protected.
Footnote: Politically, the budget makes no sense. If Stephen Harper has embraced five years of deficits, surely three years in B.C. would be acceptable. And why raise the spectre of a hidden agenda of cuts to programs and services?
Thursday, February 19, 2009
Budget, third thoughts
Attorney General Wally Oppal has a tougher time staying on message than most politicians. His candour, or lack of preparation can lead to blurts and admissions in the public interest. Of course, that means political staffers cringe in terror whenever he stands up to speak.
This week, Oppal raised questions about how real the numbers are in years two and three of the budget plan — the ones that show the path to a return to balanced bnudgets.
Confronted with the fact that the budget calls for staff cuts in the justice system just as the public is concerned about gang crime, Oppal said there is nothing to worry about. The numbers are just projections anyway. If they need to spend more, they will.
But that's not what the budget is supposed to be. It's supposed to be prudent and an accurate forecast of government plans. Unless, of course, that got lost in the rush to paint a picture that showed only two, small deficits.
This week, Oppal raised questions about how real the numbers are in years two and three of the budget plan — the ones that show the path to a return to balanced bnudgets.
Confronted with the fact that the budget calls for staff cuts in the justice system just as the public is concerned about gang crime, Oppal said there is nothing to worry about. The numbers are just projections anyway. If they need to spend more, they will.
But that's not what the budget is supposed to be. It's supposed to be prudent and an accurate forecast of government plans. Unless, of course, that got lost in the rush to paint a picture that showed only two, small deficits.
Tuesday, February 17, 2009
Budget, second thoughts
I've been having second thoughts about the budget column. Mostly, I'm looking at ministry service plans and thinking that cuts will be deeper than it first appeared. Sean Holman has some interesting reports on the budget and a memo from public sector head Jessica McDonald to employees suggesting significant layoffs are possible.
Budget '09: Timidity trumps vision
We got a timid provincial budget Tuesday, when boldness would have been welcome.
The good news, for most British Columbians, is that health care spending has been protected. It will increase by about six per cent a year through the budget period.
That's not enough to allow improvements, given population growth and inflation, but things shouldn't get worse.
But except for health, the Liberal government worried too much about keeping deficits small and brief and too little about economic stimulus and the needs of British Columbians.
Across the rest of ministries, taken as a whole, spending will be pretty much frozen in the coming year, rising by about one-half of one per cent.
Finance Minister Colin Hansen hopes that administrative savings - travelling less, or using fewer consultants - can be found to avoid program cuts.
The big guys always say that. The reality is usually different.
The budget for children and families, for example, is effectively frozen, despite increasing demand, rising costs and frustrations about inadequate services now. B.C. Housing spending will be cut by $92 million - about 15 per cent.
Funding for police will rise 5.1 per cent this year, mainly to cover RCMP contract costs, and then be frozen for the following two years. Aboriginal Affairs will lose 18 per cent of its funding this year; Community Services about 17 per cent.
The focus on "belt-tightening," as Hansen described it, is misplaced.
The Liberals' commitment to balanced budgets was laudable in normal times. In this kind of slowdown, it risks further damage to the economy, individuals and communities.
The budget projects a deficit of $495 million and $245 million in the following year before being exactly balanced in 2011/12.
Those projections - for the first time in years - include no forecast allowance. Typically, the government has included at least $750 million as a cushion against the unexpected.
Hansen points to infrastructure spending as the province's preferred form of economic stimulus. But the budget basically included already scheduled projects, plus about $2 billion in new spending as a result of the federal stimulus package.
But at the same time, the government appears to have turned its back on other forms of stimulus that doesn't involve paving or building bridges.
Arts and culture spending, for example, will be cut in half by the 2010 budget year. That means lost jobs, but also lost economic opportunities as festivals and community events fold.
The budget also comes up short on measures specifically aimed at B.C. communities outside the Lower Mainland. (Although that might change, if the infrastructure funding details include money for throne speech commitments in the north, like the Cariboo Connector and new power transmission lines.'
It's also unclear how much this budget will ultimately matter. The government will shut down the legislature before it is voted on. A new version, possibly quite different, will be introduced in September.
The budget is also based on a quick economic recovery for B.C., something that is far from assured.
It was also striking how little this looked like a pre-election budget. There's no theme, no grand vision, just a commitment to health care and caution. It suggests a Liberal election campaign built upon the argument that they are more prudent and trustworthy than the NDP in tough times.
The Liberals, despite Premier Gordon Campbell's frequent policy enthusiasms, have sometimes appeared focused on cutting government rather than in exploiting its potential to make life better for citizens.
And there is a sense in this budget of a government that is somewhat adrift. Past priorities, like the Heartland and children and even climate change, are scarcely mentioned. It portrays a model of governing as a series of administrative functions, with little vision.
Of course, that vision thing can create big problems, as the former NDP government demonstrated with the fast ferries and grand, unmanaged initiatives like the Jobs for Timber Accord. (And the current government demonstrated with the Vancouver convention centre.)
But this was a time for leadership. The government's cautious budget falls short.
Footnote: The government plans to impose a two-year wage freeze when the current public sector contracts expire in a little more than a year. It does not, however, appear to plan significant staff reductions or layoffs.
The good news, for most British Columbians, is that health care spending has been protected. It will increase by about six per cent a year through the budget period.
That's not enough to allow improvements, given population growth and inflation, but things shouldn't get worse.
But except for health, the Liberal government worried too much about keeping deficits small and brief and too little about economic stimulus and the needs of British Columbians.
Across the rest of ministries, taken as a whole, spending will be pretty much frozen in the coming year, rising by about one-half of one per cent.
Finance Minister Colin Hansen hopes that administrative savings - travelling less, or using fewer consultants - can be found to avoid program cuts.
The big guys always say that. The reality is usually different.
The budget for children and families, for example, is effectively frozen, despite increasing demand, rising costs and frustrations about inadequate services now. B.C. Housing spending will be cut by $92 million - about 15 per cent.
Funding for police will rise 5.1 per cent this year, mainly to cover RCMP contract costs, and then be frozen for the following two years. Aboriginal Affairs will lose 18 per cent of its funding this year; Community Services about 17 per cent.
The focus on "belt-tightening," as Hansen described it, is misplaced.
The Liberals' commitment to balanced budgets was laudable in normal times. In this kind of slowdown, it risks further damage to the economy, individuals and communities.
The budget projects a deficit of $495 million and $245 million in the following year before being exactly balanced in 2011/12.
Those projections - for the first time in years - include no forecast allowance. Typically, the government has included at least $750 million as a cushion against the unexpected.
Hansen points to infrastructure spending as the province's preferred form of economic stimulus. But the budget basically included already scheduled projects, plus about $2 billion in new spending as a result of the federal stimulus package.
But at the same time, the government appears to have turned its back on other forms of stimulus that doesn't involve paving or building bridges.
Arts and culture spending, for example, will be cut in half by the 2010 budget year. That means lost jobs, but also lost economic opportunities as festivals and community events fold.
The budget also comes up short on measures specifically aimed at B.C. communities outside the Lower Mainland. (Although that might change, if the infrastructure funding details include money for throne speech commitments in the north, like the Cariboo Connector and new power transmission lines.'
It's also unclear how much this budget will ultimately matter. The government will shut down the legislature before it is voted on. A new version, possibly quite different, will be introduced in September.
The budget is also based on a quick economic recovery for B.C., something that is far from assured.
It was also striking how little this looked like a pre-election budget. There's no theme, no grand vision, just a commitment to health care and caution. It suggests a Liberal election campaign built upon the argument that they are more prudent and trustworthy than the NDP in tough times.
The Liberals, despite Premier Gordon Campbell's frequent policy enthusiasms, have sometimes appeared focused on cutting government rather than in exploiting its potential to make life better for citizens.
And there is a sense in this budget of a government that is somewhat adrift. Past priorities, like the Heartland and children and even climate change, are scarcely mentioned. It portrays a model of governing as a series of administrative functions, with little vision.
Of course, that vision thing can create big problems, as the former NDP government demonstrated with the fast ferries and grand, unmanaged initiatives like the Jobs for Timber Accord. (And the current government demonstrated with the Vancouver convention centre.)
But this was a time for leadership. The government's cautious budget falls short.
Footnote: The government plans to impose a two-year wage freeze when the current public sector contracts expire in a little more than a year. It does not, however, appear to plan significant staff reductions or layoffs.
Sunday, February 15, 2009
Just be quiet, and everything will be fine
Interesting Times Colonist story on former solicitor general John Les and liquor agents - small-town stores that sell gin along with groceries and hardware.
Worth a column, but two points now. First, many groups are silenced by a cabinet minister who says, 'play nice, and I might be able to help you. Raise a fuss, and you're toast.' They buy it, even though, like the liquor agencies, they get nothing in return foir silence.
Second, it is interesting that private liquor stores, with much tighter ties to the Liberals - former minister Gary Collins is a director of one major player - have succeeded in winning big cash windfalls from the government.
The gifts to private liquor stores have added up to about $50 million a year in extra profits. And, of course, that is $50 million less in revenue for government, that taxpayers have to come up with.
Worth a column, but two points now. First, many groups are silenced by a cabinet minister who says, 'play nice, and I might be able to help you. Raise a fuss, and you're toast.' They buy it, even though, like the liquor agencies, they get nothing in return foir silence.
Second, it is interesting that private liquor stores, with much tighter ties to the Liberals - former minister Gary Collins is a director of one major player - have succeeded in winning big cash windfalls from the government.
The gifts to private liquor stores have added up to about $50 million a year in extra profits. And, of course, that is $50 million less in revenue for government, that taxpayers have to come up with.
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