Friday, September 04, 2009

Muddy waters hide true level of cuts in BC budget

The devil’s in the details, as the saying goes. But good luck trying to find them in the revamped provincial budget if you’re looking to understand where the cuts to provincially funded services are going to hurt the most.
What is clear is that somebody’s definitely going to be feeling pain. The revised 2009-10 budget reflects a major downturn in provincial revenue. Government has earmarked almost $2 billion in cuts over the next three years that will come from “administrative efficiencies” inside government, and an additional $1.5 billion in cuts to various community services receiving year-to-year grants.
The government calls such grants “discretionary.” What they mean by that is that government is under no obligation to provide the money in the first place, or to keep it coming. Discretionary grants have become a very common but extremely unstable way of funding many kinds of community services.
The $159 million or so the government hands out every year in gaming grants are considered discretionary, for instance. But that’s only the government’s opinion. Ask any of the thousands of community groups that desperately count on that money to fund important services and they’ll tell you that those gaming grants are essential.
A senior Finance Ministry bureaucrat told me at this week’s budget release that it only makes sense to cut discretionary spending first. “Isn’t that what you’d do in your own household?” he asked me.
Sure, but in that case it would be up to me to decide what expenses could be classified as discretionary. Who is it that defines “discretionary” at the provincial level for purposes of funding cuts? Whose grants are on the hit list? I spent six hours poring over pages and pages of budget documents Tuesday and am still no closer to the answer.
Vancouver Sun columnist Vaughn Palmer asked the question of the day on this point when he queried Finance Minister Colin Hansen at the budget lockup as to why there wasn’t a list of all the grants being cut. I wonder whether anyone in government even has such a list, or has any idea of what the cumulative effect will be from cutting so many community grants all at once.
Hansen invited Palmer and any other interested media to scrutinize three account classifications in the “Supplement to the Estimates” to find that out. Such classifications are known as Standard Objects of Expense - STOBS - and the ones in question are numbers 77, 79 and 80. All three provide funding for community partners, whether in the form of discretionary grants, required payments, or contractual agreements.
So I put on my reading glasses and scrutinized, aided by a kind Finance Ministry staffer who dug up the original supplement from the February budget needed to compare any differences between the two.
But as it turns out, the task is impossible even with both documents in hand. That’s because while government ministries were cutting discretionary grants, they were muddying the waters by also recategorizing a whole bunch of other STOBs that fit into those same three classifications.
For example, what looks like the wholesale slaughter of discretionary grants within the Attorney General’s ministry turns out to be just a shifting of legal-aid services into a different. Discretionary grants in the Health Ministry look like they’ll shrink from $50 million to a mere $4.3 million, but ministry bureaucrats say that, too, is just the result of funding being moved around.
In the Public Service and Solicitor General’s ministry, there’s $1 million less for discretionary grants related to policing, community services and victim services. In the Ministry of Children and Family Development, there’s $2 million less for child and family development.
Can we presume those are cuts to community groups? I don’t have a clue. Nothing I could find in the documents added up to anything like the $385 million in cuts to discretionary funding that have apparently already been made this year, so who knows what it all means?
It will be weeks or even months before anyone on the ground has any real sense of what’s being lost. At the same time, communities will be feeling the effects of local health authorities cutting $25 million a year from their budgets by reducing admin costs and their own “discretionary” spending.
The provincial cuts have all been made for this year, the Finance Ministry assures me. But that’s not to say that those on the receiving end have been informed yet, or are in any way prepared for even heavier cuts this spring. Listen for the wails in a community near you.

1 comment:

John Allore said...


Bait and switch, the shell game, three card monty: government budget offices are well versed in these tactics. It's obfuscation for the purpose of pacification.

I'm a government budget director so I too know all the tricks.