Seven months after being formed to solve the province’s desperate financial quagmire, the premier’s Economic Recovery Team delivered its final report to government today.
The 300-page document, entitled The Big Reset, lays out the harsh realities of the situation the province finds itself in, and the steps that must be taken to right the ship.
Team Chair Moya Greene says that’s possible, but only through a combination of tax increases and spending cuts that would lead to a balanced budget within six years.
Some specifics: they're suggesting a "modest" personal tax increase of 1%, and tax credit for lowest income group to offset the increase corporate tax rate by 2% @VOCMNEWS
— Richard Duggan (@RDugganVOCM) May 6, 2021
Specifically, the report recommends reducing operating grants for MUN and College of the North Atlantic by 30 per cent over the next six years, as well as the regional health authorities. It says grants to other government agencies should be cut by 20 per cent.
Nalcor Energy, says the team, must be eliminated, and the NLC and Marble Mountain should be sold outright.
As for public services, the report says hard decisions will have to be made to see which ones can continue, which ones to cut, and which ones to privatize. It says that must also include a complete review of all union contracts, and the pay and benefits they offer.
The report also recommends a new tax on the richest people in the province, as well as a five per cent reduction in core spending across the board.
“Moderate” reductions in funding are also proposed for Newfoundland and Labrador Housing and the legal aid commission.
Greene’s team says it’s crucial that the province follow the global trend of transition to a green economy. To that end, the report recommends using oil and gas revenues and the sale of government assets to fund the switch to green and pay off the debt.
The report calls for immediate action on all fronts. However, Finance Minister Siobhan Coady has repeatedly said it’s too late to apply the recommendations to this year’s budget which will be brought down at the end of this month.
Premier Andrew Furey, meanwhile, has most recently referred to the report as “suggestions” that will receive a full vetting through public consultations before anything is implemented.
