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What I Would Do to Fix the Budget Process if I Were Finance Minister


When I read that Canada’s next federal budget would land on March 28 I thought “Oh great, that’s all we need.” Especially since Finance Minister Chrystia Freeland supposedly “reaffirmed the government’s commitment to ‘prudent fiscal management,’” and when this administration promises to “continue” something you know it’s not happening. But striving to remain positive in the fell clutch of circumstance, I thought OK, if I were finance minister what would I do?

Other than resign to protest the ministry’s entanglement with the Chinese Communist Party, I mean. Or its long record of flippant profligacy (even putting aside COVID-related expenditures, the five highest years of federal program spending per capita were, um, 2018, 2019, 2020, 2021 and 2022.) And it’s… but no. I said I’d stay positive, plus in this scenario I’m somehow chained to the desk. Perhaps by fear of alternative candidates. And if I’m going to be cranky about existing policy it behooves me to offer some constructive alternative.

For instance, scrap the whole thing and start over. No, really. And constructively.

It is now a baffling 31 years since, in the Fraser Institute’s Fraser Forum, I praised British Prime Minister John Major’s stunning budgetary innovation of deciding how much to spend overall before choosing what to spend it on. So obviously I was too positive back then.

I was too positive about Major specifically and this idea more generally. But let me quote an eminent authority (me) that it would cause a battle between departments over a fixed dollar total “in contrast to the existing system whereby every Minister, Deputy Minister and Assistant Big Spender makes the largest possible claims for her own department, and then a war ensues not between the various departments but between all departments and the Treasury. The result, you may have noticed, is victory for the departments, defeat for the taxpayer, and huge budget deficits.”

Sound familiar? Clearly the Trudeau administration did not budget from scratch. Instead they thought of endless cool stuff to throw money at, asked the bureaucracy to add it to the existing mess, and kept racking up debt. It’s a strikingly reactionary approach from supposed progressives. (That governments still use faxes speaks volumes about them as “agents of change.” But I digress.)

Unless you have done something very bad, I won’t suggest that you should be made to read Canadian federal budgets. But if you do, several things jump out, starting with their habit of relegating the actual “Summary Statement of Transactions” (SST), saying how much the government expects to spend and take in, to obscurity hundreds of pages deep, though the naive might consider it the most important aspect.

No, I’m wrong. The first thing to ooze out is the slimy title. Like 2022’s “A Plan to Grow Our Economy and Make Life More Affordable.” Which doesn’t sound like an accounting document because it wasn’t one (its SST was hidden 246 pages into a 304-page brick). Or 2021’s “A Recovery Plan for Jobs, Growth and Resilience” (ditto, 328 pages into a mind-boggling 724). It’s not partisan; the last Harper budget, “Strong Leadership: A balanced-budget, low-tax plan for jobs, growth and security,” stuffed the SST 372 pages deep into its 528 and didn’t show that they had balanced the budget, only that they hoped to as soon as they lost the election.

After the title only a PR department could love come dozens of pages of econometrics struggling to give substance to airy projections about tax revenue, a hangover from Mulroney’s parade of flimsy projections of dwindling deficits. Not that the predictions have gotten any better since. Then endless pledges of free money for everyone from “A More Inclusive Arts Training Sector” (2022) to “the Children’s Arts Tax Credit” (2015). Or “A Workforce for the 21st Century Economy,” 2022’s answer to the 2015 “Training the Workforce of Tomorrow.” That old thing?

So when I say start from scratch, I want to go even further than Major didn’t. Suppose cabinet started with “How much should we spend on consultants given our 300,000-strong public service?” Or “What must government do, what should it do, and what can it do?” before deciding to pursue “A Fairer Banking Complaints Handling System for Canadians” or “the Wellness Together Canada portal.”

The Hill Times said, “Freeland must ‘say no a lot’: strategic spending needed to craft ‘challenging’ budget, say former finance officials.” But it didn’t say she would. And the current system doesn’t make it easy. What if, instead, someone had to justify every program from scratch every year of just going well, we’ve done it for decades, costs keep rising, it never solves the problem, better spend more?

If the incumbent isn’t up to the job, they know where to find me. Hiding under the desk in case they try to call or, being the government, fax.

Views expressed in this article are the opinions of the author and do not necessarily reflect the views of The Epoch Times.

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