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Op-ed: The sky isn't falling in Nova Scotia

by Danny Cavanagh

There is no budget crisis in Nova Scotia, says Danny Cavanagh, president of CUPE Nova Scotia. On the contrary, Nova Scotia is expected to record a surplus as early as next year. Photo Robert Devet
There is no budget crisis in Nova Scotia, says Danny Cavanagh, president of CUPE Nova Scotia. On the contrary, Nova Scotia is expected to record a surplus as early as next year. Photo Robert Devet

Danny Cavanagh is president of the Canadian Union of Public Employees (CUPE) Nova Scotia.

It’s one of the oldest tricks in politics. Right after you’re elected, you convince everybody there’s a budget crisis, often blaming the previous government.  Then you convince workers and the public to take cuts.  Later on in your mandate, you then rack up a ‘surprise’  higher surplus that you can use to cut taxes or to spend big just before the next election (think, Stephen Harper during this federal election). 

Which brings us to Premier McNeil here in Nova Scotia and another favourite trick of governments, to low-ball what your future revenues will be in order to exaggerate the size of the deficit.

Not only is the province of Nova Scotia expected to record a surplus as early as next year and in following years, but revenue growth is likely to be significantly higher than what the government has forecasted.  This means future surpluses will also be considerably larger than what the government forecasted in their recent budget and fiscal plan.

Squeezing wages, meanwhile, will slow down economic and revenue growth, as the government should have understood from its own recent fiscal update.  Cutting wages won’t just be bad for the economy, but it will be bad for the province’s finances.  

In his September 21 Fiscal Update, Finance Minister Randy Delorey pointed to the fact that lower wage growth has led to lower government revenues, with “personal income tax revenue down by $14.1 million…due to slower growth in compensation to employees.”    

But the government’s not proposing wage cuts, they’re wage freezes, you say?  The current offer of 0%, 0%, 0%, 1% and 1% put to the province’s teachers is actually a wage cut when inflation is taken into account. This would erase more than a decade of real wage gains for tens of thousands of workers!

This government needs to come clean and be honest about its projected surpluses starting in 2016 and going forward. The sky isn’t falling and we are not that bad off compared to other provinces. 

 


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