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| Last updated at 4:48 PM on 02/12/08 |
To spend or not to spend? 
The Journal Pioneer
In these tough economic times, the Province is taking a big risk. Instead of tightening the purse strings, government is taking a gamble, putting itself deeper in debt in hopes of stimulating the economy and creating jobs.
In Friday’s capital budget, Provincial Treasurer Wes Sheridan announced more than a half billion dollars in spending. There’s money for hospitals, manors, schools, programs, roads and bridges.
The Province plans to spend $510 million over the next five years, a package that more than doubles its capital spending of approximately $60-million annually.
Spending will increase to $130 million in 2009-10, $133 million in 2010-2011 and $118 million in 2011-2012, returning to normal spending levels the following year, a year after the next provincial election.
The government hopes that by going into debt it will be able to pull the province through this global recession and come out at the other end in solid financial shape.
But is going deeper in debt the best way to do this? There’s no doubt adding to existing debt and not being able to pay the bills is what’s caused the current economic crisis.
According to Sheridan, adding to the growing deficit, forecasted to reach $49 million next year, is something he had to do. Increasing spending, said Sheridan, will address short-term and long-term challenges and address areas of “chronic neglect”. Ultimately, he hopes, it will create more than 5,000 new jobs and $39.3 million in new provincial tax revenues.
Admittedly, no matter how tough economics times are, there are areas where an influx of funding is badly needed. One of those is health-care infrastructure.
The Province plans to spend $116.8 million to modernize and upgrade manors, expand its long-term care wing at Community Hospital, improve dialysis services at Prince County Hospital and redevelop the Province’s largest hospital.
There are questionable areas for the Province in these uncertain economic times. Is it really necessary to spend $5 million on a provincial emergency radio system? And, while modernizing corrections facilities is long overdue, can we really afford to do it now?
If the Opposition’s assertion is correct, anything past the first year of the “wish book” may not happen.
But, as taxpayers, let’s hope they’re wrong and that government’s risk with our dollars is the right gamble and one that pays off in the end.
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02/12/08
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