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Quebec Budget 2014: Hypothetical prosperity, fees guaranteed

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Photo: Paul VanDerWerf/flickr

Austerity has been the keyword for the past five years: initiatives decreasing spending in order to then slow down public debt growth were meant to ensure recovery after the 2008 financial crisis. We now know that it has instead hurt the economy. The Parti Québécois now contends it is turning its back on austerity and steering towards prosperity. In view of last week's budget, doubts may raised over the government's growth forecasts, but we can most certainly call into question the current budgetary direction's benefits for the population of Quebec.

First, the government projects that increases in corporate investments will spur on growth by going up from 0.7 per cent this year to 3.2 per cent next year. Banking in part on this boost, the government expects a 4.2 per cent increase in its own revenues next year. It's hard not to see this as anything other than typical pre-electoral enthusiasm, since the Finance Minister himself acknowledges that the uncertainty facing the global economy leads to "hesitation in investments."

Furthermore, the government boasts that it is not increasing taxes, but it's targeting families directly by increasing daycare fees. This regressive policy increases costs for parents by 28 per cent. For those who send their kids to daycare all year long, this means needing to fork out an extra $520. It can only tighten the stranglehold on households, already in too much debt.

The government is still counting on extracting resources to drive growth. The premier prides herself in claiming that we are taking back control of our resources, but she forgets to mention that the oil production in which she chooses to invest $115 million will add to our greenhouse gas emissions. Furthermore, this budget's initiatives to limit the negative environmental effects of the extractive industry are as thin as the ozone layer they're intended to protect.

Moreover, the government was delighted to announce the introduction of "patient-oriented" funding in health care. The reform towards what is really activity-based funding is meant to increase efficiency in service delivery. Nonetheless, numerous studies concerning similar experiences abroad have already showed that, in addition to having a negative impact on the quality of services, such funding schemes increase rather than reduce spending.

All in all, last week's budget impoverishes families, contributes to accelerating climate change, and leaves it up to the private sector to choose what will be the makeup of Quebec's economy. In short, it's a pretty strange way of becoming, following the budget's refrain, "master and prosper chez nous."

This article was written by Julia Posca, a researcher with IRIS, a Montreal-based progressive think tank.

Photo: Paul VanDerWerf/flickr

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