Who hasn’t imagined coming into a great wad of cash and how to spend it?
The fantasy becomes reality with all the regularity of lightening striking the same guy twice, but most folks fancy buying stuff rather than salting the bundle away for the proverbial raining day.
This month, Nova Scotia’s Liberal government faced that very decision and it bought stuff. Who can blame them? The politics of the decision isn’t a choice between instant gratification or long-term responsibility. It’s use it or lose it.
Premier Stephen McNeil allowed that consideration, presumably fleeting, was given to paying down debt and, had the money arrived back in the dark days cast by his predecessor’s shadow, the decision might have been different.
But four years of what we call sound fiscal management around here has the province on firm ground that gives the government the latitude to “invest” in Nova Scotia.
The money is offshore gas revenue won via arbitration. Accounting rules create the political “use it or lose it” dilemma. The cheque arrived in the 2017-18 fiscal year, so if it isn’t spent in the same year it just shows up on the revenue side of the ledger as a big old surplus that the government can make a virtue when it meets with bond raters who don’t even vote in Nova Scotia. But when you already have a decent surplus, making it bigger has about as much political value as bottle of rum at a temperance rally.
It was a political no-brainer, and the Liberals did some first-rate political investing. It created a $120 million trust fund to leverage extension of high-speed internet in rural Nova Scotia and convince the folks that live there it hasn’t forgotten them altogether. Sticking cash in a trust fund is how the government dances around the accounting rules, but the dodge is used with discretion and comes with the risk of allegations of book cooking.
With a three-seat majority, it’s never too early to shore up support, so the Liberals spread the love around. A goodly chunk of the money went to universities, with Saint Mary’s winning a big $11-million provincial contribution to the school’s Entrepreneurship, Discovery and Innovation Hub. That’s a building, by the way.
There’s more cash for the colleges and universities in research funding and other stuff like a sandbox where students, faculty and communities scratch out ideas. With almost $30 million in those envelopes, all the universities and the community college should get a slice.
Rugby Nova Scotia, the Atlantic Division of Canoe/Kayak Canada and the Sherbrooke Restoration Commission are on the receiving end of six-figure government cheques, and the Liberals couldn’t pass on a chance to show it has a heart.
There was money to help low income Nova Scotians heat their homes, a boost in spending to reduce the damage from opioid use, funding to help Nova Scotians on the autism spectrum move into and stay in the workforce, and money for homeless shelters.
Even with all that, the government has more of its $244 million windfall to spend, so stay tuned.
All of this is prelude to Tuesday’s provincial budget, when Nova Scotians will hear more about how the medicine prescribed in the Liberals first term has the patient on the mend, so the province can now, cautiously no doubt, loosen the purse strings.
Nova Scotia is well into the seventh iteration of Nova Scotia’s long running political series, dating back to Premier Donald Cameron, who upon succeeding John Buchanan famously declared the province bankrupt. The actors change but not the script.
Each new government finds nasty financial surprises left behind by its vanquished predecessor, necessitating austerity ranging from the Savage extreme to McNeil’s targeted cuts. Each government miraculously restores the province’s fiscal health just in time to ask for a new mandate. McNeil’s Liberals are the first to win a second majority following the script.
The old macro economic axiom that told governments to save during the good times, so they can spend and cushion the blow of the inevitable hard times doesn’t much apply in Atlantic Canada where public spending largely determines whether times are tough or tougher.
Whether our financial house is sturdy, as the Liberals claim, or made of cards, will eventually be a judgment rendered by their inevitable successor.
Jim Vibert, a journalist and writer for longer than he cares to admit, consulted or worked for five Nova Scotia governments. He now keeps a close and critical eye on provincial and regional powers.