ST. JOHN'S, N.L. — Leaders of Newfoundland and Labrador's three political parties agree federal government support is needed, but is it a “bailout” or a “partnership” that is required?
The first, physically distant sitting of the House of Assembly got underway Monday. All 40 members of the House were present for the proceedings, with desks spaced and masks available for members in the legislature.
This sitting is mainly to address four pieces of legislation that have been left incomplete for months. Other legislation and motions may be added for the sitting, expected to last two weeks.
But during Tuesday's question period, the fiscal state of the province was top of mind.
Premier Dwight Ball says the province will need direct support from Ottawa in the coming federal budget.
"Right now, our debt-to-GDP is bothersome. If this continues, it is not sustainable." — Dwight Ball
“The situation is very serious. When I say that, I base it on where we are with our GDP. We have a debt-to-GDP ratio that is much higher than any other province right now,” said Ball.
“Provinces receiving equalization that are posting large surpluses, that is not what equalization was designed to be. Right now, our debt-to-GDP is bothersome. If this continues, it is not sustainable. We cannot continue to borrow at the levels that we would normally want.”
In March 2019, auditor general Julia Mullaley noted the province’s net-debt-to-GDP ratio was 46 per cent, much higher than all the other provinces at the time — well before the fall in oil prices and the COVID-19 pandemic.
Ball and New Democratic Party Leader Alison Coffin sparred over whether the province will need a bailout, with Ball preferring the term “partnership” to talk about direct support from the federal government.
“We just need a partner in this. This is not a bailout. This is not something that’s not happening in other provinces. All we’re looking for is fairness,” said Ball.
Coffin says it needs to be called what it is.
“I’m a little confused by that. (Ball) hasn’t offered anything in exchange for it. He just says, ‘We need rate mitigation,’ and we ran out of time for borrowing and we need money for the oil industry. He hasn’t offered anything else, hasn’t talked about a partnership. He just denied it was a bailout,” said Coffin.
“Certainly, I’m more concerned about the fact that three separate times in almost three months we’ve had to go to the federal government for money. That’s very disconcerting. It certainly says perhaps there’s not a very good fiscal management plan in place.”
Progressive Conservative Leader Ches Crosbie agrees with Ball that support for Newfoundland and Labrador has to include direct support for the oil and gas industry in the province.
"Not helping us now in our hour of need, when 30 per cent of our economy is at risk, is a hostile act against this province." — Ches Crosbie
“I totally agree that the rational thing to do for the central government, for Mr. (Prime Minister Justin) Trudeau, is to make that investment in the offshore in the form of the tax credits and incentives that we’re all talking about. I absolutely support that,” said Crosbie.
“But it’s clear at this point that the Trudeau government has made up its mind: it’s not going to do that. I think they lump us in with the tar sands in Alberta. Call it an environmentalist group within the Liberal caucus nationally that doesn’t distinguish between us and our product and what they think about Alberta. They’re not going to help us. Not helping us now in our hour of need, when 30 per cent of our economy is at risk, is a hostile act against this province.”
Twitter: @DavidMaherNL
