What if the new temporary budget watchdog that Premier Christy Clark has hired actually barks?
In the context of former bank economist Tim O’Neill’s arrival on the scene, it would be unusual to hear much of anything from him.
And if he does raise any objections, so what? It will be much too late in the process to do anything about them. The government would need to know about his concerns a bit sooner than the actual day of the budget, which is when he’ll be reporting publicly.
If he discovers serious problems with the way the revenue projections are being used, it’s going to be odd hearing about them after the budget is put together, after the speech is written and on the day the plan is presented to the public.
The only effect will be that the B.C. Liberals will look a bit foolish for not thinking up this measure earlier.
Another scenario is much more likely. O’Neill will spend a few days researching numbers that many, many others have already gone over, and pronounce the revenue projections as sound as any forward-looking estimates can be.
They’re just a series of expert guesses based on what commodity prices, the B.C. economy and the global economy will do for the next 12 to 36 months.
The telling thing about O’Neill’s contract is that it shows how thin the margin is this year between a balanced budget and a deficit. And how worried the Liberals are about pre-election suspicions.
Finance Minister Mike de Jong warned how close it is going to be in his last update. But the Liberals promised a balanced budget, so they simply have to make it happen.
O’Neill’s walk-on role — at least as envisioned by the Liberals — is to reassure everyone that they haven’t faked the revenue estimates, as the NDP did in years gone by.
He told the Times Colonist this week his work will be confined strictly to the revenue estimates. That’s all the money collected from corporate and personal income taxes, royalties, sales taxes and all the other levies that bring in more than $40 billion a year. There’s no time to look at the spending side, or even the specific likelihood of it balancing.
He said the time frame is “way too short” to reasonably consider everything in the budget. “My job is much more focused …. My only job is to look at the revenue projections — are they reasonable or not?
“They didn’t ask for, nor would I offer, an opinion on the budget itself.”
So taxpayers who are paying for the opinion (up to $25,000) will get some outside views on one key element. Then they’ll be free to make up their own minds about the overall document.
He’s far from the only outside expert who passes judgment on the projections. The B.C. Liberals formed an independent economic forecast council in their first term that is legally obligated to advise on growth projections.
The 14 members are surveyed twice a year to advise government on trends. O’Neill’s work will amount to a quick add-on to the forecast council’s product.
He’ll also give the revised forecast for the current fiscal year ending March 31 a once-over.
This year is forecast to be in deficit. Next month’s budget will have an estimate of how big it is, but the exact number won’t be known until the auditor general reports in July.
The May election heightens the interest in the numbers, even if they are just projections that aren’t confirmed until months after the fact.
The Opposition has been consistently suspicious of the idea that the 2013-14 budget can be balanced. Introducing it as such would give the B.C. Liberals a lift, which is obviously the reason for the emphasis. But making it happen would require a lot more than seeing the revenue figures meet the targets set for them.
It would need a lot of penny-pinching on the spending side. And whoever is in power after May would be a lot more comfortable with a healthy margin of error, rather than the fractional percentage that de Jong is working with.
The new consultant will probably conclude the revenue guesstimates are honest.
But it’s a long way from there to seeing them come true.
