The vision that Premier Christy Clark is aiming for is the eventual elimination of provincial debt. "Our plan starts with the jobs plan and ends with a debt-free B.C.," she said Monday, releasing the B.C. Liberals' election platform in advance of yesterday's official start to the campaign for the May 14 election.
It's the basis for all the fiscal calculations, it's the highlight of the platform and it's written on the side of her campaign bus.
The concept is to seize the liquefied-natural-gas and oil-refinery opportunities,
maximize the revenue from those projects and create a multibillion-dollar bonanza that could be used to pay down debt.
There's an outside chance that this is achievable, but a lot of things have to go exactly right before any future finance minister claims debt has been eradicated.
The current projections are that B.C. could collect anywhere from $80 billion to $220 billion in revenue from liquefied natural gas over 20 years - if the plants are finished, if contracts are signed and if the prices stipulated in the contracts hold firm.
The plan is to bank half of all that potential revenue and apply it to debt. But it looks like future governments would have to hit the brakes when it comes to piling up debt in order to reach the goal.
The Liberal plan has a rough outline of where the money might come from. But there's nothing on the need to rein in capital spending to help make it happen.
And that's one thing the B.C. Liberals aren't known for. Debt has been climbing at a healthy rate year after year for 12 years. And the rate shows no sign of slowing.
B.C. had a total debt of $56 billion last year, up from $36 billion in the Liberals' first year in office. It's $63 billion this year and is scheduled to climb to $69 billion in three years.
(The figures don't include the contractual obligations incurred in various outsourcing and privatization projects.)
Most of the debt was incurred through spending on infrastructure - highways and bridges - and schools and hospitals. And there's no expectation that demand for all those projects will slow over the next 15 years.
At the moment, it looks like the Liberals are planning to mount a diligent effort to pay down their home mortgage, without acknowledging they're going to keep re-mortgaging to fund continual renovations.
Some observations on the rest of the plan: . Controlling spending, balancing the budget - The plan is to do a core review of all ministries, which is a re-run of a 10-year-old idea that created a lot of angst and paved the way for huge program cuts. They're also promising to toughen balanced-budget legislation, which will be laughed off, given that the Liberals waived the law for four years in a row.
. Tax freeze - The platform promises to freeze personal income-tax rates for five years. But the budget just two months ago includes a two-point hike on that portion of income over $150,000, for two years, starting next year. The platform also promises to maintain that hike, so it's a contradictory message. But by no stretch of the imagination can that be called a tax freeze.
. Spending cap - The platform promises to cap government-spending increases against the rate of nominal GDP (growth). Any government-wide spending cap will sooner or later have to involve the Health Ministry. And capping health spending is a controversial prospect, as Clark found out when she broached the idea during her leadership run two years ago.
Having an extremely long-range vision is commendable. But Clark's platform leans heavily on benefits that are four to seven elections away. She can't promise much in the here and now because, as the budget made clear, there isn't any money around at the moment. [email protected]
