The Saskatchewan Party finally brought down the 2016-17 provincial budget, and it was about what was expected, a document which shows the economy with the brakes on.
Potash revenues are not what they once were, a situation which appears to be more the norm now. China’s economy has slowed and since it was a driving force in creating economic good times, and buying potash on the world stage, that is not good news here.
We can add here the Saskatchewan Party’s economists have missed the mark on predicting the potash revenue streams even in the better years, so don’t expect the sector to bounce back this year either.
Saudi Arabia is busy buying back market share in the oil sector with lower cost-of-production oil, and that has slammed that sector hard here in Canada.
That impacts the province’s revenues, and may be worse than forecast as oil futures are hardly robust.
None of this is startling news. We all were aware the skids were on the economy and that impacts revenues collected by the province, to the projected tune of $958 million.
Any doubts of that were dispelled when the Saskatchewan Party held off on dropping a budget prior to the election where it might have been a voter issue.
The overall budget shows a deficit of $434 million. The amount may not seem massive, and in overall terms it isn’t, but it does mean each resident of the province essentially would need to ante up $400 to cover it, just to keep things in perspective.
The question might be why, after coming out of the best economic years in the province’s history, a point referenced by Premier Brad Wall and the Saskatchewan Party repeatedly through their tenure, there was not some money put away to buffer the slow times which everyone knew would come one day?
There are those who will note people regularly spend without putting away a nest egg, and that is often true, but government should be wiser, one would think.
The key, though, is where the Saskatchewan Party goes from here, as the economy is not likely to rebound in a year, and if their projections are off, and they have been before, the deficit could be much larger moving forward.
It seems after a near decade in power the Saskatchewan Party had an inkling their might be savings to be had in both the area of education and health, and a decade into their reign are finally going mining for those savings.
Education Minister Don Morgan has stated conversations between divisions, the province’s teachers’ federation and others will need to start now. He wants a look at how to share services, do common buying, determine superintendent numbers and more as a way to trim costs.
In the area of health care, a special commissioner is to be appointed to recommend options for fewer health regions—there are currently 12—and more efficient delivery of services.
Both areas may indeed find savings, and that’s great.
But why a decade into a run as government?
The Sunrise Health Region has an annual budget of about $225 million. Let’s say they save 10 per cent, or about $22 million. Multiply that by 12 regions that would be $264 million. Now imagine the Saskatchewan Party had done the review even five years ago. That would have been a $1.32 billion saving. Of course in the greatest economic times in the province’s history running a tight financial ship in health and education wasn’t needed, although that money would be a nice nest egg for the current situation.
So let’s be pragmatic and applaud the effort of review even if it might be a few years late in a series of majority mandates.
Then why stop at education and health?
Yes, Wall has said everything is on the table, but is it? Where is the suggestion that maybe we need to change the population of provincial ridings, and reduce the number of MLAs? Certainly federal MPs have far larger ridings, and given current transpiration and electronic information sharing, larger ridings would certainly be manageable.
And what of municipalities? Does the province need the array of rural, town and village councils it has?
If it is time to ask the tough questions like whether school principals might do more administrative work in education, then let’s truly broaden the debate to government itself too.
