Prime Minister Stephen Harper is not an ideologue obsessed with small government, but a pragmatist focused on visible spending with a political payoff, says Christopher Stoney, one of the country’s leading experts on federal government spending, and co-editor of How Ottawa Spends 2012-2013: The Harper Majority, Budget Cuts, And The New Opposition.When looking at the Harper government after almost seven years, “It’s hard to pick out a particular definitive fiscal policy because I think it is inconsistent. I think the only consistency is, is that it plays very much for partisan political reasons, rather than thinking about what might be in the best interests of the economy,” said Prof. Stoney in an interview with The Hill Times.
“There’s been an increasing politicization of spending and the fiscal stuff, so it’s really harder to predict than perhaps it once was in the ’70s and ’80s,” he said.
Prof. Stoney pointed out inconsistencies such as cutting the GST despite economists’ concerns and lowering corporate tax rates—though not as much as originally thought—while approving billions of dollars in stimulus money and investing heavily in areas like defence and public safety as examples of a government that has, at some points, played against type.
“Anybody who thought that this was going to be a low-tax, small federal role would have to be disappointed. I think its reach is as big as ever,” he said.
One telling example in the 2012-2013 edition of How Ottawa Spends, the 33rd edition and the book of record when it comes to analyzing the way the federal government uses tax dollars, comes from Western University professor Neil Bradford and University of Toronto professor David Wolfe, who argue that “an evolving mix of political strategy, economic conditions and ideological adaptation” led to the PM changing his mind on regional development agencies.
When he was running for PM in 2004 Mr. Harper (Calgary Southwest, Alta.) denounced federal regional development agencies as “corporate welfare” and tied them to Liberal pork-barrelling. In 2009, Mr. Harper founded two regional agencies himself, Canadian Northern Economic Development Agency and Federal Economic Development Agency for Southern Ontario. Together, the five regional development agencies spent just under $1.2-billion in 2010-2011, according to the Public Accounts.
The professors argued that as part of the effort to become more centrist, the Conservatives softened their stance on the agencies.
“That is an interesting development. One has to say it ties in with this longer-term trend, that’s not just this government, there has been certainly an increased attention given to the visibility of spending. Retail politics, if you like,” said Prof. Stoney.
The stimulus money of the economic action plan, with its oversized cheques, on-site billboards and numerous funding announcements and re-announcements, is a classic example of retail politics, he said, but added that the previous Liberal government was also moving towards branding economic decisions.
“I think Stephen Harper is often portrayed as an ideologue,” he said.
But stimulus funding, for example, “went very much against the small-government, small-spending philosophy of this government and they were very quick to change their views according to that,” explained Prof. Stoney.
The 2012 budget announced $5.2-billion in cuts to the government’s about $80-billion operating budget over three years. The hardest hit departments include Agriculture, Finance, Natural Resources, Privy Council, and Public Safety, more than 10 per cent cuts to their budgets. Those with the lowest levels of cuts include Aboriginal Affairs and Human Resources Skills Development.
The cut comes in the context of prior years of increases in government spending at an average of six per cent according to the book.
The decisions on what to cut rested with Cabinet, and the government excluded transfers to the provinces in an effort to distance itself from the more severe cuts under prime minister Jean Chrétien in the 1990s.
“It seems to me that again the government is not really basing this on any particular calculation other than political calculation. They need, to some extent, to look as though they’re reducing their own spending and the size of government,” he said.
Whether the government decides to enact more cuts, hold fast to commitments or even ease up on their reduction plans in the coming years, Prof. Stoney believes it will very much depend on the political and economic climate in Canada approaching the next election, slated for fall 2015.
“I think they will play it very much by politics. They’ve already relaxed the forecast to pay down the deficit in response to the economic climate. That could be seen as a sensible move, but I don’t get a sense that there’s a steadfast determination to get to the point as perhaps the Liberal government did, and arguably they were in a worse position,” he said.
In 1994, the Liberal government, faced with a $38.5-billion deficit, tabled a budget that would cut an estimated $17-billion and 40,000 public service jobs in the coming years.
The current government spent $272.4-billion in 2010-2011, according to the most recent public accounts. So far this year, it has asked for authority from Parliament to spend $256.7-billion, though it will likely put in a request for further funding in early February.
As for the 2013 budget, expected in February or March, “I certainly wouldn’t expect a lot,” said Prof. Stoney.
“I’m not getting any indications really from anybody at the moment that this is going to be a significant shift in policy,” he said.
“It will be building on what they’ve started to do incrementally. I think the trends that we have seen where certain departments seem to do better will continue,” he said.
At the time of budget tabling last spring, the official opposition New Democrats were leaderless. This time around, the Liberals will be searching for a new head. Prof. Stoney said that the government may see who is chosen and introduce wedge policies later in the year, designed to make the Liberal leader squirm.
“If it is Justin Trudeau he is undoubtedly going to give the Liberals a spike. They might want to start putting money into areas that would make it difficult for him to oppose, or to call him out on issues where they think he may be vulnerable,” he said.
Changes in store for How Ottawa Spends
The book of record when it comes to dissecting how Canada’s federal governments have spent their dollars and pinched their pennies every year, How Ottawa Spends will publish its 34th edition this year.
It’s edited by Carleton University public policy and administration professors Bruce Doern, who founded the book, and Christopher Stoney, who has worked on four editions including the upcoming 2013-2014 installment, to be published in late summer.
Changes are in store for the publication. In the coming years the professors are looking to take the book, which is made up of contributions from Canada’s top public administration scholars, online. They also plan on moving to a scholarly journal format and calling it How Canada Spends to encompass all levels of Canadian government.
“We’ll try and keep what we think is good about How Ottawa Spends but this would allow us to get this out even more quickly,” said Prof. Stoney.
The professors feel that through the rise of social media and punditry, HOS’s annual analysis of spending has kept its relevance by offering analysis grounded in solid research.
“You can go on anywhere and get an opinion, but how do you try and look at what are the longer-term trends? How does this compare to what happened in the 1990s?” said Prof. Stoney.
Over the decades, the book has mapped the evolution of public sector management, he added.
“Reading an old How Ottawa Spends now is very telling, because you get a sense of a different kind of age,” said Prof. Stoney.
Other trends that have been charted on the pages of HOS include the rise and wane of environmental policy, every major procurement scandal in the past 30 years, changes in the federal-municipal relationship, and a pattern towards discretionary—potentially pork-barrel—spending, said Prof. Stoney.
There is also a tradition of being critical of government, no matter what party is in power, he added.
“Looking back over the past 30 years or so, you see that because this government is obviously in government, they’re there to be shot at for people like us. I think some people think that we’re being particularly over-zealous in going after the government for what we see as bad policy or bad government. But it was exactly the same when the Liberals were there,” he said.
The next edition of HOS will be chock-a-block with the kind of in-depth instant replay on spending that its readers have come to expect. Several papers are lined up on the government’s multi-year, multi-billion, strategic and operating review.
Carleton University professor Ian Lee is reprising his landmark paper ‘Pink Slips and Running Shoes,’ which he first wrote for HOS in the mid-1990s on the Liberals’ massive spending cuts. In the next edition, he tackles this government’s spending reductions.
There are a number of papers on the Harper government’s economic agenda, including how effective it is, and what influence it has had on other areas of government policy.
“We’ve got more chapters this time because we had so many really good papers that were submitted,” said Prof. Stoney.
Original Article
Source: hill times
Author: JESSICA BRUNO
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