Budget Of Pain

Saskatchewan’s post-boom financials have cruel cuts for all of us

Feature | by Gregory Beatty

Surveying the damage from the Saskatchewan Party’s March 22 budget, a form of ancient Chinese torture and execution sprang to mind. I don’t know if the cuts absorbed by the public sector actually reached 1,000, but they certainly were numerous.

Axing Saskatchewan Transportation Company, a Crown corporation which brought passenger and freight service to 253 communities on 25 routes, grabbed most of the headlines. But here are some other biggies:

ARTS & CREATIVITY

The Saskatchewan Arts Board, principal funder of arts creation in the province, saw a five per cent cut from $6.958 to $6.610 million. One immediate casualty was Culture On The Go, which funded artist tours in Saskatchewan. Creative Saskatchewan, which provides marketing support for artists and arts organizations, absorbed a five per cent cut too, from $7.699 to $7.314 million.

Also coming under the knife: The Saskatchewan Heritage Foundation, which saw its budget sliced from $504,000 to $300,000. Other line items that sustained cuts were Provincial Heritage and Culture, which dropped from $2.648 to $1.258 million, and Community Sport, Culture and Recreation which fell from $4.3 to $2.1 million.

“We recognize there are budget areas that have seen far greater challenges than the arts community anticipates at this point,” Saskatchewan Arts Alliance president Kelly Jo Burke said. “We believe that while government’s investment in our sector is small, its impact is large, and helps address our province’s need to build an innovative and creative economy leading to economic sustainability.”

EDUCATION

Saskatchewan’s pre-kindergarten-to-Grade-12 school system will receive $1.86 billion in operating funds in 2017-18, which is $22 million less than last year. “We’re already at the bare bones,” said Saskatchewan Teachers’ Federation president Patrick Maze. “There’s no way to escape it. There will be cuts in the classroom.”

The government also boosted the education mill rate on municipal property taxes by 10.6 per cent, which will translate into a $67 million hit for home owners. “School boards will be dealing with significant challenges as a result of reductions in this budget,” said Shawn Davidson, Saskatchewan School Boards Association president. “School boards recognize that our province is in a challenging fiscal situation, but our member boards believe there must be continued investment in students and education to ensure a strong future for our province.”

The government is also reducing spending in the Ministry of Advanced Education by 5.8 per cent, which translates into a $44 million cut for the University of Saskatchewan, University of Regina, Saskatchewan Indian Institute of Technologies and Saskatchewan Polytechnic. Personal income tax credits for education and tuition expenses were also eliminated, scholarships reduced from $14.3 to $12.5 million and student aid lowered to $26.2 from $32.5 million.

“I can’t sidestep the fact this is probably the largest single budget cut we’ve ever had in our history,” said University of Saskatchewan president Peter Stoicheff.

“It’s a huge number,” agreed University of Regina president Vianne Timmons. “It will mean that we will lose positions — absolutely. Services for students will potentially be lost. We’ll have to look at everything we do.”

LIBRARIES

Saskatchewan’s public library system also took a massive hit. Libraries in Regina and Saskatoon will see $1.3 million in funding cut entirely, while five regional libraries will see their funding drop from $6 to $2.5 million.

“Libraries are about more than just borrowing books,” said Rhonda Heisler, CUPE library sector coordinator. “Meeting rooms are used by community groups, library staff host education programs and clubs, and the publicly accessible computer terminals are very popular. There are services for seniors, children, employment support, language and reading groups, citizenship test preparation, and help for newcomers to build their résumés.”

CITIES

In addition to funding cuts in the education and library components of property tax, ratepayers will be hit by the province’s decision to end the payment of “grants in lieu” by Crown corporations such as SaskPower and SaskEnergy in exchange for not paying property taxes.

Province-wide, that’s a $36 million hit, with Regina and Saskatoon absorbing about $22 million of that.

“This is an $11.4 million hole in our operating budget for providing core services to citizens,” said Saskatoon Mayor Charlie Clark. “This amount is more than the cost of running all of our leisure facilities, or 25 per cent of our fire services budget.”

“We will continue to work in the days ahead to determine the full impact of these changes and the downloading they represent, but we know this represents a significant amount of revenue,” said Regina Mayor Michael Fougere.

Funding for the Saskatchewan Housing Corporation, a Crown corporation which provides support for low income and affordable housing programs in Saskatchewan, also sustained a massive cut — from $11.755 million to $755,000. The cut, which approaches 85 per cent of Sask Housing’s budget, is so huge it looks like a typo.

ENVIRONMENT

Funding for regional parks was chopped from $1.023 million to $523,000. The government is also ending a program that grants ranchers access to Crown pastures. It’s expected the 51 pastures, which cover 780,000 acres of often ecologically sensitive land, will be sold.

“Once we privatize Crown land,” says Saskatchewan author and naturalist Trevor Herriot, “we severely weaken our ability to create and enforce the laws, regulations and policies required for sustainable grassland management for the wider public interest: climate change mitigation and carbon management, species at risk, biodiversity, soil and water conservation, access for education and recreation…. and so on.”

The government also slashed funding for Meewasin Valley Authority — a Saskatoon-based group which promotes conservation in the South Saskatchewan River valley. Previously, the province contributed about 20 per cent of MVA’s budget. That’s been halved, with funding dropping from $909,000 to $409,000.

HEALTH & SOCIAL SERVICES

While the Ministry of Health received a slight boost from $5.167 to $5.205 billion, the government is eliminating Hearing Aid Plan coverage of audiological testing and subsidized hearing aids for everyone except low-income residents — an estimated hit of $3 million. It’s also phasing out coverage of podiatry and orthotic foot-care services ($1.485 million) and sleep apnea devices ($800,000).

Starting July 1, long-term care residents will see a fee hike from 50 to 57.5 per cent of income. The hike is expected to apply to about half of residents, and will see the maximum monthly fee on top of the $1,086 base charge rise from $2,065 to $2,689.

The government has also promised a wholesale review of social services programs. Areas that could potentially be impacted include the Saskatchewan Assured Income Disability program, school supplies, special diet benefits and home repair programs.

TAX FAIRNESS

The government’s commitment to cut corporate and personal income taxes (the former from 12 to 11 per cent) is expected to cost the treasury $107 million in 2017-18. That revenue will be offset by increasing the PST to six per cent, and expanding its reach to include children’s clothing, restaurant meals, insurance premiums and home construction/renovation.

Unlike corporate/income taxes, which are progressive in that those with greater income pay more, consumption taxes see the burden shared equally by all taxpayers regardless of income. Funding cuts sustained by municipalities will also impact on tax fairness, as property taxes are also a form of flat tax, so any hikes that result from provincial downloading will hit all ratepayers, regardless of income, equally hard. ❧