10/21/12

Politics, not deficits, behind attack on collective bargaining

Before the Liberals started attacking collective bargaining, they proposed a wage freeze in the summer of 2010.  The unions duly met with the government over the summer of 2010 to discuss this. While there was no agreement, settlements funded by the province have now moderated significantly.

But since that time the Liberals have sharpened their attack significantly, crushing free collective bargaining in the school board sector and starting plans to do the same in the broader public sector.  They have also increased their demands from a wage freeze to cuts in compensation.

So what caused the Liberals to go postal in the interim?

Well, it wasn't the province's fiscal situation.

In the 2010 provincial Budget (just before the summer meetings with unions), the province planned deficits of  $21.3 billion in 2009-10, $19.7 billion in 2010-11, $17.3 in 2011-12, and $15.9 billion in 2012-3 billion.



Deficit (in billions of dollars)
2009–10
2010–11
2011–12
2012–13
Total
2010 Budget
21.3
19.7
17.3
15.9
74.2
2012 Fall Economic Outlook
19.3
14
13
14.4
60.7
Reduction in Deficit
2
5.7
4.3
1.5
13.5


But, as it turned out, the deficits were much less in each and every year.  According to the government's October 15 Fall Economic Statement, the deficits were $19.3 billion in 2009-10, $14.0 billion in 2010-11, $13.0 billion in 2011-12, and  $14.4 billion for 2012-13 (and look for that last figure to drop further in next year's Budget, and perhaps again when the Public Accounts come out ).

So in total, the government has a debt that is $13.5 billion less than it was forecasting two years ago.  That is way, way more than even they claim they will get through their attack on public sector bargaining (including the doctors).  (And, in any case,  they have achieved a lot of these claimed "savings" through free collective bargaining.)

A more likely explanation is that the politics changed -- or at least that the Liberals imagined it was opportune to adopt much of the Progressive Conservative position on free collective bargaining.

Too bad for them, but, as discussed on Friday, that hasn't worked out so well for the Liberals.

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