Why the Tories are risking big political blowback to make minor funding cuts

Last week, the Progressive Conservative government found itself defending corner-store beer sales and funding cuts — so what do those things have in common?
By John Michael McGrath - Published on April 30, 2019
Small tree sapling growing in a flower pot
The $4.7 million tree-planting initiative that the Tories have cancelled amounts to just 0.003 per cent of the $163 billion the government plans to spend in the 2019-20 fiscal year. (iStock/bruev)

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Even if Doug Ford’s government eventually backtracks on its proposed funding cuts for public-health agencies, it’s the kind of political choice that needs an explanation. The cuts — which will grow to $200 million annually by 2021, according to the government — have sparked a big public fight, something the Tories might have thought they’d managed to avoid when the budget they unveiled two and a half weeks ago met with a generally sedate response.

For all the political heat the Progressive Conservatives are taking, the scale of the cuts is small: 0.122 per cent of the government’s overall budget. Similar cuts that have been making headlines are also tiny: the $4.7 million for tree-planting amounts to just 0.003 per cent of the $163 billion the government plans to spend in the 2019-20 fiscal year. They’re closer to rounding errors than actual spending discipline, and none of them, on its own, is going to come even close to balancing the budget. So the move raises a basic political question: Why run the risk of sparking controversy through unpopular cuts when they don’t even do much to get the budget back in balance?

The government, of course, isn’t doing these things separately and individually — these cuts are part of a program. And there will be many more cuts that won’t necessarily become public for weeks or months, because the provincial budget process is incredibly opaque. Many of them will slide by relatively unnoticed (except, of course, by the people who rely on the services that are no longer available). Others will cause new headaches for the government.

The short explanation for why the Tories are doing this — and handing their political rivals a stick with which to beat them — is twofold. Firstly, it’s a conservative government and thus believes in lower public spending and lower taxes. (I hesitate to call it “small government,” as it also wants to use the power of the state to force gas stations to display anti-carbon-tax stickers.) This basic, fundamental aspect of the Progressive Conservative program for government is easy to treat like political wallpaper, but remember that the PC party was out of power for 15 years: Tory MPPs, especially those who served in opposition under the Liberals, really fundamentally believe that the province was harmed by Liberal overspending, especially under Kathleen Wynne.

This isn’t speculation: Finance Minister Vic Fedeli told TVO’s Steve Paikin as much in an interview on our podcast, #onpoli. But he said something else that’s relevant to the budget (which hadn’t then been finalized). When Paikin asked Fedeli what advice he’d received from other finance ministers, he responded, “Get your work done early … hard and fast. But I’m not entirely sure that that’s what our economy can take today.” 

That qualification notwithstanding, his answer serves as a partial explanation of why the government is making so many of these small-but-visible cuts now, early in its mandate. It’ll take a lot of fire for these cuts, and more, in the hopes that if it gets the hard stuff done early, it’ll be easier to maintain spending discipline in future years. And, who knows, if the Tories catch some lucky breaks, maybe they’ll balance the budget a year early — in time for the next election.

Which leads me to something else that runs through the budget, evident in such items as uploading Toronto’s subways and allowing beer and wine sales in corner stores: so far, this government isn’t terribly interested in explaining to its supporters why the good things they were promised have turned out to be hard to do.

Take corner-store beer: industry insiders have issued dire warnings that breaking the agreement the Liberals signed earlier this decade, the one that paved the way for the peaceful expansion of beer and wine in grocery stores, would be expensive. The government has said that the cost estimates are wildly inflated; The Globe and Mail reminds us all that, if the Tories wanted to use a “nuclear option,” they could simply legislate the agreement out of existence, though that would result in a different set of consequences. (Business investors, for example, might get spooked; even if that doesn’t happen, the province could end up being dragged to an international tribunal.) The government may not have to go that far, but it’s shown no signs of backing down on the black and white commitment it made during the election campaign.

Contrast that with the commitment the McGuinty Liberals made during the 2003 election to regulate the tolls on the 407 highway. Like the one about corner-store beer, this was a popular and populist promise that had the added bonus of making the government of the day look hapless and out of touch. Except, oops, it turned out that the Liberals couldn’t deliver on that promise using the normal channels of government policy. They lost in court, badly, when they tried — and ended up with nothing but a disappointing settlement.

What’s relevant here isn’t that the Liberals made a promise they couldn’t keep, but that, in the end, they felt it made more sense to go back to their voters and explain why something they’d promised turned out to be impossible instead of forcing the issue.

It’s still early in the Ford government’s mandate, but it’s not preparing voters for that kind of disappointment. On everything from cutting Toronto city council to cancelling renewable-energy projects, it’s proven willing to use all the levers of power it holds, including ones that governments have been wary of using before. (See notwithstanding clause, the.)

So, for now, it’s full speed ahead.

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