Paying the fiscal piper

As Finance Minister Joe Oliver rose Wednesday to deliver a fiscal update to a blue-chip business audience that trumpets balanced books and a surplus on the way, it is be a good time to remember how we got here.

As Finance Minister Joe Oliver rose Wednesday to deliver a fiscal update to a blue-chip business audience that trumpets balanced books and a surplus on the way, it is be a good time to remember how we got here.

It’s also a good time to remember how quickly a surplus can be vacuumed up.

It was after the deep cuts unveiled in his 2012 budget that the former finance minister, the late Jim Flaherty, told Canadians that those cuts were to “back-office operations” of government that would not be noticed by Canadians.

It was all about fat, not delivery of services, he told us. A quest to test that theory by former Parliamentary Budget Officer Kevin Page ended up in court, unresolved.

But there is at least anecdotal information — and lots of it — that some of those back-office cuts are banging on the front door in 2014.

A simple tally of recent reports, some gleaned by this newspaper and The Canadian Press and testimony before parliamentary committees, gives us a partial sense of what we are sacrificing to ensure this government could get to surplus and offer its tax breaks in a pre-election period.

This week alone there was a report from the government’s public accounts showing the Harper government’s spending on marine safety had plunged 27 per cent since 2009-10 while aviation and rail safety were both down 20 per cent or more.

Transport Canada says the cuts were made on overhead, administrative and support services, but opposition critics find it hard to believe safety is not being compromised while oil shipments by rail skyrocket.

Another document obtained by The Canadian Press showed Aboriginal Affairs had to shift $505 million in money earmarked for infrastructure over a six-year period to social and educational spending.

The money has bled the infrastructure fund and still not covered the shortfall on education and social spending. The infrastructure shortfall means fewer schools and more boil water orders in First Nations communities.

The information commissioner, Suzanne Legault, has also gone public, complaining she cannot keep up with complaints over the antiquated Access to Information Act.

Her $11.2-million budget has been sliced by nine per cent over five years while complaints are soaring, up by 31 per cent last year alone.

The Toronto Star has reported extensively on cuts at Parks Canada, which is dealing with a $27-million shave from its planned $659.7-million 2014-15 budget, meaning shorter seasons at national parks and restricted hours at historic sites.

Money will also be saved by moving away from guided tours, making them “self-guided visitor activities.”

Tuesday, in a published opinion piece, Colin Kenny, the former chair of the Senate Committee on National Security and Defence, points to a $44-million cut from the budget at the Canadian Security Intelligence Service two years ago and a 15 per cent dip in the RCMP budget over four years.

RCMP Commissioner Bob Paulson, in testimony to the committee on which Kenny sits, did not ask for more money — not in public — but he said he had to reallocate resources to anti-terror duties.

Just last week, Page’s successor, Jean-Denis Frechette, warned that the package of tax breaks and increases to child benefits leave no room for permanent tax cuts or spending increases for Oliver in the next federal budget.

He also called for long-term thinking regarding the needs of an aging population, particularly when it comes to health-care costs.

Federal transfers to the provinces for health care increase by six per cent per year until 2016-17, but will then be tied to national economic growth, a take-it-or-leave-it edict passed down by Flaherty early in Prime Minister Stephen Harper’s majority mandate.

Frechette says billions of dollars of health-care costs will be downloaded onto the provinces.

The Conservative government is exactly where it wants to be, using a surplus to target families with children in an election year, daring its political opponents to cancel those breaks if they want to spend a surplus elsewhere.

But that doesn’t mean we didn’t get to where they wanted to be with no damage to services.

Those who analyze government spending always knew it would take service cuts, not salary and hiring freezes, attrition and reduced travel to get to this point.

While you await your cheques, you might want to remember they didn’t come free.

It may have already cost you from health care to security, from access to parks to treatment of our First Nations.

Tim Harper is a syndicated Toronto Star national affairs writer. He can be reached at

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