Recent statistics show that as the economy has slowed down over the past several months, Canadians have been putting more money against their debt and saving more money. This is partially a reflection of the concern they have for their own finances in the months ahead.
In contrast to the approach Canadians and Manitobans are taking, the provincial NDP government has made it clear that they don’t even want to make the minimum payment on the province’s debt and instead want a free pass on any further debt reduction. To do this, they are preparing to change the existing law in Manitoba.
In 1995, the Balanced Budget Act was introduced in Manitoba by the Progressive Conservative government. In addition to it requiring that governments balance their books each and every year, it also mandated that each year a certain amount of money be paid toward the debt. In essence, a minimum payment on the province’s credit card.
Last year the NDP government did away with the requirement to balance the books every year and now they want to change the debt repayment schedule. Under current legislation, the province should be paying down the debt by $110 million in each of the next three years for a total of $330 million. However, in March the NDP said that they wanted to reduce that debt repayment to $20 million for this year. And just last week, they changed their mind again when they introduced legislation that doesn’t require them to repay a penny of debt for the next three years.
This is particularly concerning because Manitoba has a severe debt problem. Currently the debt of the province is more than the debt of the provinces of Saskatchewan, Alberta and British Columbia combined. Delaying debt repayment just makes the problem grow worse and worse.
By eliminating the need to balance the budget every year and by now trying to do away with debt repayment, Gary Doer and the NDP have broken a promise they made to Manitobans in 1999 when they said they would keep the Balanced Budget legislation in place and live within it. It was one of the key promises that got the NDP elected that year and its one that today, more than ever, needs to be kept.
There is a reason that Canadians are putting more money away and paying down more debt. It’s because they know that it makes sense to meet your obligations today and to prepare for tomorrow. The NDP seem to be content to live day by day on your taxdollars and not even make the minimum payment on the province’s debt. Eventually, that kind of living catches up with everyone.
