Making Tough But Necessary Choices, Op-ed

NOTE: The following is an op-ed piece from Finance and Treasury Board Minister Diana Whalen.

The 2015-16 budget on April 9 may be the most important budget Nova Scotia has faced in quite some time.

In preparing the budget, I met with many Nova Scotians who shared great ideas about new or enhanced public programs. The hard truth is we just don't have the capacity to act on them all right now.

Almost 10 per cent of our budget is chewed up by interest payments on debt. You read that right, interest payments. We can't even begin to pay down the debt until we achieve a balanced budget. Our goal is to achieve a balanced budget within our mandate. In this year's budget we will be one step closer.

The budget process began months ago when government took a close look at the functions of each and every department. The aim of this effort, called Program Review, was to look for efficiencies and to uncover programs or services that could be changed or discontinued. In a $10-billion budget, there are a lot of programs. The premier challenged each department to look at what they were doing and try and find better ways to deliver the programs and services people depend on.

Why would we spend so much time looking over the effectiveness of our programs? It is the only way to find improvements.

In my pre-budget consultations, which took me across the province, I talked to people from all walks of life. The overriding message I heard is that change is necessary and government needs to get its financial house in order.

This means we need to rethink what government does, and how it does it.

This line of thinking extends into all aspects of government administration, including tax credits and user fees.

As recommended in the tax and regulatory review prepared for the province by Laurel Broten, we are examining all tax credits and HST exemptions provided by government. Together, these cost the province $350 million annually. We need to ensure that they are effective and are good value for money.

After careful consideration, we decided the tax exemption on books will not be removed. Literacy is essential to economic growth and greatly enhances our quality of life. We will not be taxing books.

We also decided the tax credit provided to volunteer firefighters and search and rescue workers will remain in place. Nova Scotians have been very vocal in their support for this credit because it is a tool to attract and retain critical volunteers.

We are studying other tax credits, including the Film Tax Credit and the Equity Tax Credit.

All of government's spending, as well as tax incentives and exemptions, has to be looked at if we are to move forward. That is why we have to consider the affordability of everything we do.

The increase in provincial user fees is one of the difficult decisions we have made. Increasing these fees helps cover the cost of providing services. Without an increase, we would need to cut $7.7 million from core public services in our hospitals and schools.

The call to action in the One Nova Scotia report by Ray Ivany has been heard, and we all know the status quo is not working for us. We have had the slowest growing economy in Canada for more than 20 years, and successive governments have added to the debt by bringing in deficit budgets where the spending was greater than the revenue. We have had to borrow to pay for services in 20 of the last 30 years.

It has to stop.

Our $15-billion debt did not happen overnight. It has been years of growing public spending and increasing demands for government to provide services. Our deficit and debt grew from many big and small decisions that added to our obligations when we couldn't afford them. Now we have to get back to government's core business. We can't afford to be all things to all people.

With balanced finances, the province will be better able to seize opportunities for growth and provide a future here for our children. We will be able to reduce taxes and create winning conditions for our province. That is the plan and our budget this year will show our progress.

There are tough decisions to be made, but I can assure you we are prepared to make them for the long-term benefit of all Nova Scotians.