Opposition parties say government’s ‘annualized’ claim is unclear
When the House of Assembly resumes sitting today, it’s a safe bet MHAs will spend a good deal of their time talking about money.
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Some of the talk will no doubt concern the big stuff — long-term borrowing, the $2-billion deficit and proposed cuts across the board — but there will likely be a few questions about $100 million Finance Minister Cathy Bennett says she saved by cutting discretionary spending.
In fact, NDP Leader Earle McCurdy said he expects his party will keep asking, because they don’t know what the heck is going on.
“It's part of our job in the House from our caucus to get information out to people, and especially if what's being volunteered by the government is as sketchy as those documents were,” McCurdy said.
Last Wednesday, Opposition Leader Paul Davis asked about the constraints imposed on discretionary spending by the Liberal government.
“I believe the number is somewhere in the vicinity of about $100 million, which is substantially more than the former administration's discretionary spending freeze that took place over the course of a much longer period,” Bennett said. “I'd be happy to provide the Leader of the Opposition with the exact details, and also be happy to provide that to the media.”
Then on Wednesday after question period, Bennett spoke to the media, and revealed the $100 million was “annualized” cost cutting.
That seemed to mean that since the Liberals have been in power for only about three months, they actually saved about $25 million, and they were extrapolating out to the rest of the year.
The next day, during question period, the first question by Davis was about the discretionary money issue.
“Here in the House of Assembly yesterday, I asked the minister of Finance, and she stated without qualification, that their government has, since December, achieved $100 million in savings from the reduction in discretionary spending and travel,” Davis said.
“I ask the minister: can she assure the House of Assembly today that her statement and answer given yesterday, that they've saved $100 million since December, is accurate?”
Bennett replied, “I'm proud to stand in this House of Assembly and confirm that, through the work of this government in just 88 days since taking office, we have identified more savings of $97.5 million for 2015-16.
“These savings, which include discretionary savings, have been realized through things like no reallocation of dropped balances or savings, the reduction of parliamentary assistant salaries, the reduction of political staff, restrictions placed on hiring, restrictions placed on consultants and the elimination of discretionary travel as per the directive our government issued back in December.”
Bennett concluded her response by saying, “I have the document here, Mr. Speaker, that I'm happy to table at your discretion.”
True to her word, after question period Bennett tabled the document, but that only raised more questions.
The one-page document has a single line with three numbers:
Savings identified in Fiscal Update $118,054,100
Revised Savings Projected as of March 9/16 $215,616,900
Additional Spending Savings Identified 97,562,800.
There were no details about where the government found ways to cut costs, and no information about how exactly the “annualized” aspect of this works.
McCurdy said if a lot of the money the government is saving is associated with year-end unspent money, that can’t be “annualized” because there aren’t four year ends.
He called the whole situation “pretty flimsy.”
A spokeswoman for the Department of Finance said in a brief email statement, “As the minister indicated in the House, details of annualized savings achieved and how they factor into Budget 2016 will be outlined in the upcoming budget.”
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