Sigh

Just took a quick look at the 2008-2009 NB budget. Read the summary here.

Marginal increase to Business New Brunswick’s budget. Still only $7 million for ‘investment attraction’ and ‘export development’. Out of a $7 billion budget. That’s a nice round number.

Lots of new spending on most areas – Health care and education spending up well above GDP growth (for the nth straight year).

Business New Brunswick’s budget is $52 million (although they claim $10 million in revenue) -so I guess the net budget is around $42 million. I think this is a small increase over last year but it’s hard to know for sure. There has been a bump in something called ‘loans and advances’ but I don’t really know what that represents. Does it include the tens of millions already out there in loans to textile mills, etc.? I don’t know the accounting on this stuff.

All I can say is that Ontario just announced a $1.15 billion new program to attract industry to that province. Remember, this is just one of many Ontario programs.

And don’t forget the $125 million given to Mr. Creative (Richard Florida) as a chair at the University of Toronto.

In New Brunswick,

Health care gets another $113 million. The population today is about the same is 1996 (using Census data). That billion more in health care spending seems to be working.

Social Development gets over $30 million more. Maybe that will be to help all the laid off forestry workers.

Natural resources department has been cut deeply. Maybe because all the lost forestry jobs mean we don’t need as big a department.

I guess we will never see significant new dollars for economic development. Not from the Feds or the Province. So, the only alternative is to get tightly focused. We should scrap it all and put $100 million into the development of one sector that we think we could have some success in. Nickel and dime-ing all this stuff will get us nowhere.

I think it is a shame that our health care spending has more than doubled in just over 10 years – on a stagnant population. You won’t hear one politician, pundit or otherwise say so but this is a shame. We should have found a way back in the 1990s to control health care costs – something slightly innovative maybe like making guys like me pay $20 to see the doctor – and plowed the additional hundreds of millions into investments in our economy and economic development. We would have grown the tax base and our population and would have been in a much better place.

It will be interesting to read the commentary tomorrow in the local press.

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0 Responses to Sigh

  1. nbt says:

    Wow, a 1% budget for outside exports and investment initiatives. That’s bad for two reasons: 1.)it’s not like these guys believe in tax cuts to spurn on growth, so that has to hurt the feelings of a few economic statist in this province and 2.) 1% just plain sucks, especially when they are a spendthrift government anyway.

    Btw, I notice that they are going to STUDY (sorry for the mikel type emphasis) the tax system to see how they can make it more competitive. Not only does that go against their claim that the first year was all about studies and the next few were about action, it isn’t that complicated to start with. Plus, they could have saved a few thousands bucks on high priced tax consultants like Jack Mintz.

    Here’s how simple it is: stop raising taxes and cut them. Gee, that was easy. lol

  2. Anonymous says:

    The economic development funding was certainly not prominent. Instead, they opted to buy a plane, fund more travel to China to attract immigrants and add to a bail out fund to help failing companies in ridings that voted ‘correctly’.

    If we created good quality jobs, the immigration issue would look after itself (e.g. Alberta)

    Also very disappointing to see millions more going into university tuition. While this has good public optics, the reality is there is more university student supply than there is NB industry demand so this is wasteful in two ways: 1) it uses NB tax money to subsidize workers for Ontario and Alberta and 2) it allows for more ‘elaborate’ living by a certain portion of university students who drive nice cars, take vacations to Cuba and go clubbing 3-4 nights a week. I know there is a portion of students that really need the help but the days of students living on orange crate furniture and dining on Kraft dinner while working three jobs to get through university are gone. Both the universities and the students need to learn to economize.

    Secondary education money should have gone to the community colleges to expand capacity and improve teaching programs. Ask any business and you will discover that most can find more than enough university graduates but college graduates are a hot commodity. So hot, that university students are being slotted into college positions to make up the short fall. Colleges have been neglected in favour of universities for too long and business is paying the price for it.

    And how about tapping into the Environmental Trust fund to fund operational costs of the Department of Environment? Wow, what a prescedent this sets. It undermines the confidence in all trust funds. Watch for legal action to be taken by those groups dependent on the trust fund.

    Throwing money at popular issues (education and health) and hiring more civil servants when NB already has a disproportionate number of them is hardly intelligent government; arguably it is smart politics but that is not going to get us where we need to be.

  3. D Stewart says:

    e.g. Alberta?….ahh..so It isn’t the oil and natural gas after all!! Alberta simply created jobs by some other mysterious method and all we have to do is copy it to do the same. What a relief it is to know the fortunate happenstance of having Billions of dollars of oil reserves has nothing to do with creating jobs in Alberta!!That really does make things so much more…simple…minded…

  4. richard says:

    Health care spending is perhaps a consequence of poor gdp growth. Lower incomes are associated with poorer health, as well as poorer education performances. Little can (or should) be done about health care spending increases until after gdp improves. There is no good historical evidence that this could be achieved via tax cuts, BTW.