Skip to main content

Wage freeze rationale fizzles as Ontario deficit shrinks (retroactively)

Of the provincial deficit and Dwight Duncan, the provincial Finance Minister, the Toronto Star suggests that the “spectre of looming shortfalls … helps bolster Duncan’s case for a planned wage freeze for more than 1 million public servants, including nurses, teachers and bureaucrats.”

Well, that argument is weakening.

The Public Accounts for the province have now come out for 2009-10 and the deficit is a lot smaller than Finance Minister Dwight Duncan and the Liberal government forecast. In fact, another $2 billion was lopped off the provincial deficit.

The Liberal government also reduced its deficit estimated by $3.4 billion the day before the March provincial budget. That makes the 2009-10 deficit $5.4 billion less than the Liberals had estimated it to be half way through the year.

(When I see discrepancies this size, it does make me wonder if I've put too much faith in Finance Ministry forecasts.)

In any case, the government will not get one-tenth of $5.4 billion through its proposed public sector compensation freeze this year. Indeed, they won’t get one tenth of the $2 billion figure.

One might think that this good news on the deficit might cause the government to reconsider the wage freeze.

But, alas, there is not much sign of that, yet.

While there is not much of an economic case for attacking public sector workers, the Liberals appear to think there are some political gains to be made -- apparently, it is all to harvest a few votes from Tim Hudak and the Progressive Conservatives.

Our job is to give them reason to review that (rather cynical) political calculation.  Without any pressing economic necessity,  a little political pressure might just tip the balance. 

Are the Liberals, for example, willing to introduce legislation and attack free collective bargaining to get their compensation freeze? It's not clear, especially if the Liberals are squeezed.

One thing's for sure: that plan didn't help Bob Rae too much when he was premier. He burnt his bridges with much of the labour movement when he attacked free collective bargaining in the public sector.  And that was when the deficit was a much larger percentage of the economy and the economic rationale a bit more credible.


dallan@cupe.ca
Labels:

Comments

  1. Barb RAugust 28, 2010 at 9:50 AM

    Doug says: "While there is not much of an economic case for attacking public sector workers..."

    Have you forgotten about the $212 billion debt? Sound like a mighty good economic case for "attacking" public sector workers.

    ReplyDelete

Post a Comment

Popular posts from this blog

More spending on new hospitals and new beds? Nope

Hospital funding:  There is something off about the provincial government's Budget claims on hospital capital funding (funding to build and renovate hospital beds and facilities).    For what it is worth (which is not that much, given the long time frame the government cites), the province claims it will increase hospital capital spending over the next 10 years from $11 billion to $20 billion – or on average to about $2 billion per year.   But, this is just a notional increase from the previous announcement of future hospital capital spending.  Moreover, even if we did take this as a serious promise and not just a wisp of smoke, the government's own reports shows they have actually funded hospital infrastructure about $3 billion a year over the 2011/12-2015/16 period. So this “increase” is really a decrease from past actual spending. Even last year's (2016-17) hospital capital funding increase was reported in this Budget at $2.3 billion - i.e. about 15% more th
Post a Comment
Read more

Ford government fails to respond to 72% increase in COVID inpatient days, deepening the capacity crisis

COVID infections continue to drive up hospital costs and inpatient hospitalizations in Ontario. For the most recent fiscal year (April 1, 2022- March 31, 2023) hospital stays related to COVID cost $1.221 billion, according to new CIHI data.   This is about 4% of total hospital spending, creating a very significant new cost pressure beyond the usual pressures of population growth, aging, inflation, and rising utilization.   Costs for COVID related hospitalizations increased 22.2% in Ontario in 2022/23 from the previous fiscal year, rising from $999 million to $1.221 billion.  That rise is particularly notable as the OMICRON spike of late 2021 and early 2022 had passed by the the 2022/23 fiscal year.   The $222 million increase in COVID hospitalization costs came in the same year as the Ford government cut special COVID funding and, in fact, cut total hospital funding by $156 million.     In total, there were 60,653 COVID hospitalizations in Ontario in 2022/3, up from 47,543 in 2021/2. 
Post a Comment
Read more

Paramedic Services in Canada: Structure, Privatization, Unionization and other issues

Governance and Funding :  While police and fire services are usually municipal services, Emergency Medical Services (EMS) are typically controlled by provincial governments.  In Ontario, regional municipal governments have responsibility for delivering and funding EMS.  But even in Ontario the province plays a key role, strictly regulating EMS, providing funding for 50% of the approved land ambulance costs, and paying 100% of the approved costs for air ambulance, dispatch, base hospitals, First Nation EMS, and for territories without municipal government. Delivery :  Like police and fire services, EMS is predominantly a publicly provided service in Canada.   But businesses have now made some significant in-roads into EMS, primarily  Medavie,  a private corporation based in the Maritimes that describes itself as not-for-profit.  Medavie goes back over 70 years, with its roots in health insurance.  It still operates Medavie Blue Cross with 1,900 employees.  It now a
Post a Comment
Read more