By Dean Midyette

Pioneer Publisher

In British Columbia all municipal governments are required by law to produce a balanced budget. If cost overruns are incurred, the municipality has two years to rectify the situation. At the local level, every budgetary item is examined to determine if any cost savings can be recognized or if a tax increase is necessary. As a result, municipal budgets are extremely accurate documents.

At the provincial and federal level, no such laws exist. These governments can borrow money to cover cost overruns without having to raise taxes to deal with shortfalls that result in a deficit. As there is no requirement to cover cost overruns within a defined period of time, deficits tend to add up. This also means the budgets produced by higher levels of government are far less accurate.

This April, the federal government released a budget forecasting a surplus of $1.4 billion, which included taking money out of the contingency fund used for disaster relief and Employment Insurance. The last time I checked, Employment Insurance was not related to taxes, so what is almost $2 billion of the fund that belongs to Canadian workers and employers doing in General Revenues? Ah, it is an election year.

One very important note is the feds based the budget on a growth projection of two per cent. If these projections are off by only one per cent, it will mean the government will run a deficit of $3.4 billion. The economy contracted in the first quarter and is expected to contract further in the second quarter, which could result in a deficit of well over $5 billion in 2015. Say goodbye to the much heralded surplus.

Here in British Columbia, fires are raging. With tinder-dry conditions and hot weather, Ministry of Forests officials are predicting up to 30 new fires per day could start, and resources are already stretched thin. Each year, B.C. budgets $63 million to fight wildfires, a number that has no basis in reality. Last year, almost $300 million was spent fighting wildfires with the annual average over the last ten years being $145.5 million. So, why budget so little? This year, the B.C. governments budget predicts a surplus of $879 million. With resource projections exceeding current market values, we are seeing this surplus (literally) go up in smoke.

We need to demand that our provincial and federal politicians construct more responsible budgets instead of playing shell games for votes.