February 15, 2009

Budget Credibility

The May 12, 2009 provincial election will be only the second election held in accordance with the four year cycle of fixed election dates. The first held on May 17, 2005, and the events leading up to it provide insight on what tricks the Campbell government will play this time.

The only feature of the legislative calendar that hasn't been abandoned by the government is the provision to automatically pass without debate any legislation the government decrees. In 2005 the government decreed that the legislature would adjourn on March 10th even though the legislative calendar called for it to sit up to the election. On March 6th it introduced a Supply Act to give itself authority to spend six months of the budget without passing detailed ministerial estimates; just four days later, using closure to cut off debate, it passed Bill 20 and adjourned the legislature. The legislature wasn't recalled until after the election in September when a new budget was introduced. That's exactly what will happen in 2009, so don't believe a word you read about the budget that will come down on Tuesday, February 17th. The real budget will be made public in September.

A major difference between 2005 and 2009 is that B.C. is in an economic crisis. Even the Campbell government has recognized that B.C. is not in an economic bubble zone isolated from world events, although it can't bring itself to admit that the good times were also due to world events beyond its control that drove up commodity prices. With attention focused on the economy, shutting down the legislature won't be enough for the Campbell government to protect itself from an avalanche of hard data that will challenge what is contained in its February 17th budget.

The welfare statistics for November 2008 were released late in the afternoon of New Year's Eve. Those statistics showed the number of cases classified as "temporary assistance expected to work" up 24.3% in November 2008 relative to November 2007. The statistics for December show the expected to work cases up by 30.0%, from 19,708 in December 2007 to 25,609 in December 2008. That is a human tragedy, and it is a source of "cost pressure" that has to be watched in Tuesday's budget documents.

The government has the benefit of daily statistics on its tax collections to help it forecast how revenues are doing relative to forecasts, but it will not share that level of useful information with the public.

Statistics Canada has a schedule of key indicators that will be made public before the May 12th voting day. Consider the following from Statistics Canada's schedule of release dates:

There are other indicators, and the picture will become clearer as the flow of data from Statistics Canada is used to measure the rhetoric and forecasts contained in Campbell's February 17th budget.