Lorraine Michael says Tories are inciting fear with pension liability
Despite running a $537-million deficit, and plans to borrow $1 billion from the bond market this year, Premier Tom Marshall was at pains Monday to say that the Tory government’s decade-long streak of not borrowing for operational purposes is still — technically — alive.
Tom Marshall. — Photo by James McLeod/The Telegram
Marshall said that really, the government has around $1 billion in the bank, and its only borrowing to refinance old bonds that are coming due, infrastructure spending and Nalcor.
“This year we will not be borrowing for operational purposes,” Marshall said during question period in the legislature. “We will not be putting money on the credit card to pay groceries. We will not be borrowing to pay the light bill. We will in fact have a surplus of $400 million on operations this year.”
The deficit, he said, comes from infrastructure and other expenses besides program spending.
In the House of Assembly, Monday’s question period seemed like a tug-of-war between the political parties for how to frame last week’s budget.
Liberal Leader Dwight Ball continued to frame it as an election campaign budget, even though Tory leadership frontrunner Frank Coleman came out over the weekend to say that he doesn’t plan on calling an election until some time in 2015.
“Why are you borrowing a billion dollars to pay for an election-type budget against a backdrop of weak economic growth?” Ball asked.
He also took aim at the government’s population growth strategy, considering the budget documents forecast population shrinkage of more than 2,000 people in the next few years, and he wanted to know how much it’s going to take to remediate the Abitibi mill site in Grand Falls-Windsor, years after the government accidentally expropriated it.
“With remediation costs estimated to be around $100 million, the total cost to taxpayers for this government’s botched expropriation is now close to $400 million,” Ball said.
“I ask the premier: How much money is in this year’s budget that is allocated for the demolition and the remediation of the Abitibi site?”
Transportation Minister Nick McGrath wouldn’t give a clear answer to the question. He said the government has a number of things it wants to demolish, but there is only so much money for demolition, so tough choices have to be made.
“We have several properties throughout the province, the Abitibi site being one of them. We have the hospital site in Grand Bank,” McGrath said. “We have several sites here in the capital city that needs to be demolished or looked at. There is an amount of money this year allocated in the budget that there is no specific amount for a specific project. What we will do is look at the projects, prioritize them, and then we will decide which money of that allocated money will be spent on those projects.”
New Democrat Leader Lorraine Michael used her time in question period to go straight for the most pressing fiscal issue in the province, according to Finance Minister Charlene Johnson: public sector pensions.
In fact, Michael demanded that the government admit that it’s not actually such a pressing issue after all.
“Since Thursday, I have heard from public service pensioners who fear they could lose their pensions based on what they are hearing in the media from government and its apologists,” Michael said. “I ask the premier: Can he assure pensioners that their pensions are safe?”
Michael said that the public sector unions will come up with a fix to the pension problems, and the government’s concerns about the unfunded pension liability is “scaremongering.”
Errors in this story have been corrected