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Nova Scotia Alternative Budget Focuses on Jobs and Growth

Canadian Centre for Policy Alternatives provincial budget offers range of different choices

by Robert Devet

The Nova Scotia Alternative Budget calls for increased spending on poverty reduction, healthcare, education and affordable housing.  Prior to a formal press conference there was a community briefing, with Christine Saulnier, Director of CCPA-NS, economist James Sawler, and housing expert Pamela Harrison. [Photo: R. Devet]
The Nova Scotia Alternative Budget calls for increased spending on poverty reduction, healthcare, education and affordable housing. Prior to a formal press conference there was a community briefing, with Christine Saulnier, Director of CCPA-NS, economist James Sawler, and housing expert Pamela Harrison. [Photo: R. Devet]

K'jipuktuk (Halifax) -- The 2013 edition of the Nova Scotia Alternative Budget, released on March 25th, calls for significant increases in spending on poverty reduction, healthcare, affordable housing, childcare and post-secondary education.

Each year the the Nova Scotia chapter of the Canadian Centre for Policy Alternatives (CCPA) releases a fully costed alternative budget. This year it reflects the input of well over thirty volunteers who provided their expertise in areas as diverse as health, housing, fiscal policies, education and the environment.

Woven throughout the document, aptly named Strengthening Connections, Connecting Communities is the notion that a budget should bridge divides and engender equality, be it based on gender, race, (dis)ability or income.

It is an alternative budget, in that, as Christine Saulnier, director of the Nova Scotia CCPA puts it: “It pushes back on government's decisions, shows that there are different choices, and that the choices we offer will get us to place where the province is more economically and socially just, as well as more environmentally sustainable.”

The alternative budget also pushes back on the notion that this year's budget should be balanced.

James Sawler, a contributing economist at Mount St. Vincent University, points to rising unemployment figures to suggest that Nova Scotia is in bit of a slump, and that what our economy needs is a boost, rather than austerity and a rush to balance the budget this year.

Sawler also argues that the province's financial situation is not as dire as is often suggested, nor is the province's spending out of control.

“We believe that the debt to GDP ratio is a better measure of fiscal responsibility [than your ability to balance a budget],” says Sawler. ”If you are a household the amount of debt you can carry will depend on your income, and governments are similar. In 2000 the GDP to debt ratio for Nova Scotia was almost 49 percent, it has since fallen to below 35 percent and it continues on its way down.

“What we are often told is that Nova Scotia has a poor fiscal position because we are overspending. Yet in Nova Scotia the money we spend per capita on programs is third lowest of all provinces.”

Sawler adds that this is not just a recent phenomenon, but has been the case for many years.

Freed from the need to balance the books this year, the alternative budget allocates $143 million to boost social assistance payments, on average by 50 percent. “There is a huge gap between the income of people living on social assistance and the poverty line,” said Saulnier. “People are not able to make ends meet at all.”

Saulnier points to the hidden costs of poverty to argue that we all benefit when we address poverty. A report issued by the Nova Scotia chapter of the CCPA in 2010 estimates the true cost of poverty for Nova Scotia at $1.5 to $2.2 billion dollars per year. For the provincial government alone this cost is estimated at $600 million. "If we invest now, we save later. If we don't invest now we will continue to exacerbate the problems," says Saulnier.

The alternative budget also calls for increased spending on health care, affordable housing and education.

The report argues that healthcare must be universal, publicly-funded, and publicly-delivered, and expresses concern about proposed federal cuts. The alternative budget calls for new healthcare spending to the amount of $90 million. It singles out the establishment of community healthcare centres throughout the province as particularly urgent.

Primary, secondary and post-secondary education all see increased funding as well. “We have seen years of cuts to our primary to grade 12 system and we see the ripple effects of that”, says Saulnier.  "When we close a rural school, that has a detrimental effect on our rural areas.”

Crushing debt loads carried by university students are also addressed.

Pamela Harrison, provincial coordinator of the Transition House Association of Nova Scotia, spoke to the recommendations in the alternative budget that pertain to affordable housing. Harrison argued that non-profits must receive more government support in their efforts to build affordable housing capacity and that the trend towards privatization must be counteracted. It calls for an injection of $75 million in new spending.

The alternative budget also calls for the establishment of a separate department to deal with housing issues. Today most of these responsibilities reside with Community Services.

Also in the alternative budget is the reinstatement of rent control and the hiring of rent enforcement officers to ensure that health and safety as well as accessibility standards are adhered to.

The alternative budget touches on many more issues. Food security, rural economic development, transportation, crime prevention and a long-term energy strategy are just some of the issues addressed.

How will the alternative “jobs and growth” budget pay for all this increased spending?

One way is increased progressivity in our tax system. The alternative budget raises the tax rate for the two top income brackets.

The alternative budget also generates $48 million through fully taxing capital gains and stock option incomes, and also generates additional monies by eliminating tax credits that mostly benefit wealthier Nova Scotians, such as credit for sport and recreational expenses for children.

Shifting tax deductions to tax credits will level the playing field for less wealthy Nova Scotians and is expected to generate $195 million.

As well, the alternative budget calls for the discontinuation of the Energy Rebate, arguing that the proposed poverty and energy reduction measures constitute much more effective strategies to accomplish its objectives.

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