We already know Tuesday鈥檚 provincial budget will show a surplus. Finance Minister Mike de Jong has said as much. But how big the surplus will be, and how many more might follow, are critical questions.
In recent years, provincial budgets have become something of a horror show: deficit after deficit, cutback after cutback, prolonged underfunding of critical services.
Not all of the fault lies with de Jong and his government. They have shown remarkable discipline while digging their way out of a hole.
But the larger truth is these hardships were almost entirely avoidable. Before the 2008 recession, Canada鈥檚 economy had enjoyed one of the longest periods of uninterrupted expansion in modern times 鈥� 16 years.
Amid such buoyant prosperity, money should have been set aside for a rainy day. But nothing of the sort was done. Instead, both NDP and Liberal administrations spent like there was no tomorrow and borrowed to pay for it.
The provincial-debt figures tell the story. At the start of the growth cycle, in 1992, direct government debt (meaning Crown corporations are excluded) stood at $9 billion. By 2008, when the good times finally ended, far from paying down the debt, successive governments had tripled it.
What caused this foolishness? Want of leadership, want of foresight, want of basic common sense.
Because after the boom came the bust. And with no savings to fall back on, the only option was a starvation diet.
Since the recession, government spending, adjusted for inflation, has grown by just one per cent a year. That鈥檚 well below the minimum required to keep up with a growing and aging population.
The results have been painful to watch: support for the poor clawed back, wait times for elective surgery lengthened, the education system ransacked for every last dollar of change, Crown corporations compelled to pay dividends they cannot afford.
And yes, more borrowing. Direct government debt now totals $42 billion, while interest payments approach $2 billion a year.
But it鈥檚 not just the public sector that suffered. Working-class families have lost ground in recent years, as B.C.鈥檚 economy continues to struggle.
We urgently need a job creation/job retention strategy to get our province back on track. Yet the picture that emerges from the cabinet room is a single-minded preoccupation with cost-cutting. Nothing else matters.
This is not government leadership; this is government on the ropes, government in retreat.
We will learn on Tuesday what comes next. The minister has hinted at some loosening of the pursestrings.
Specifically, he suggested his government might stop deducting support payments from social-assistance cheques. Single mothers and people with disabilities have been hard hit by this miserly policy.
However, de Jong also implied a good part of the newfound surplus would be used to pay down debt. Presumably, that means austerity will be with us for some time, in one form or another.
And that is the crux of the matter. A measure of reinvestment in core public services is now essential.
But so is holding the line. It would be the height of ill wisdom to repeat the mistakes that led us here in the first place.
That鈥檚 why the size of the surplus, and those that might follow, will be so decisive. If de Jong builds a decent-sized cushion now, he can revitalize core programs and still weather a downturn.
That means a surplus of at least $2 billion this time around, and probably closer to $4 billion in the budgets that come after. Can he do that?
We鈥檒l see. But the minister at least has this going for him: No one wants a repeat of the past seven years.
