budget 2012 – The Concordian

The Parti Québécois plans to eliminate Quebec’s hefty deficit by the end of the next fiscal year through its new budget proposed last Tuesday that offers tax increases coupled with spending cuts.

The budget presented by Finance Minister Nicolas Marceau includes a raise in taxes on banks and the wealthy, and an increase in sin taxes on products such as tobacco and alcohol. Individuals earning more than $100,000 per year will see their income taxes increase by 1.75 per cent to 25.75 per cent; combined with federal taxes, Quebec’s highest earning residents will pay nearly 50 per cent of their salary in taxes.

The provincial government also backtracked on its electoral promise to remove the health-care tax initially implemented by the Charest Liberals. The proposed plan shows a shift in the health-care tax, which will now be factored by income. Adults earning less than $18,000 per year will not be required to pay and those earning more will contribute $100, $200 or up to $1,000 annually. The budget also introduced a tax break for parents with children engaging in sports or cultural activities, and a scaling back of Hydro-Québec rate hikes due to begin in 2014.

The Liberals and the Coalition Avenir Québec, the two opposition parties, did not approve of the provincial budget which may trigger a snap election in January that could potentially remove the PQ from power. While the Liberals were quick to criticize Marceau at first, party members backed down from their threats to potentially form a coalition. Since the PQ holds a minority provincial government, it requires the support of the opposition to move forward with the proposed budget.

One area that received little attention in the new budget was post-secondary education. Universities and students hoping for more information on future funding were left in the dark as the budget specifically mentions that as the government does not know “the decisions that will flow from the summit on higher education” they cannot make specific plans.

“Another reason why not to trust that elections will resolve problems,” said Vanier College student and Mob Squad member, Anthony Kantara. “It just encourages us to further mobilize.”

What little information is available in the budget’s section on universities may be disappointing for some students. With the tuition fee increase cancelled, the budget outlines the amount of money this has cost the government, starting with $24 million this year and continuing upwards at the same rate each following year. Additionally, the PQ plans to reduce the money available to students for loans and bursaries to 2011-12 levels after this year, undoing the increase that the Liberal government put in place. The cancellation of the tuition hike is the reason cited for this reduction.

A single line in the universities section of the budget indicates that, as previously stated, the government “could compensate universities for the shortfall stemming from cancellation of the tuition hike” but does not provide any details.

Concordia University spokesperson Chris Mota said that Concordia’s position was reflected in a statement issued by the Conférence des recteurs et des principaux des universités du Québec, which represents 19 universities in total including McGill University, Bishops University and Université Laval. In the statement, CREPUQ raises several concerns, including the impact the budget will have on research in Quebec, its commitment to compensating universities for the reversal of the tuition increase, and for the fact that no commitment to compensate universities for additional costs incurred by student protests has been made.

Martine Desjardins, president of the Fédération étudiante universitaire du Québec, told The Concordian that she did not believe universities had truly lost money to the cancellation of the tuition hikes, saying that “when you’re good administrators, you’re planning for the worst, you’re not planning for the best. It’s their problem if there is a loss because they should have planned for this first, because we didn’t know if the tuition fees would be going up.”

Desjardins also said that FEUQ was disappointed with the lack of research funding, and that many items on the budget would be brought to the upcoming education summit for discussion.

“Every little part of the budget will be discussed, hopefully, in the summit, but right now we have a lot of concerns,” she said. “We’re very disappointed that the PQ are using the same financial plan as the Liberals were proposing last year, so we still have the same structure.”

With files from Kalina Laframboise.

OTTAWA (CUP) —“The plan’s measures focus on the drivers of growth: innovation, business investment, people’s education and skills that will fuel the new wave of job creation,” Finance Minister Jim Flaherty told reporters in advance of the budget’s unveiling in the House of Commons on March 29.

But apart from a heavy focus on industry-related research and additional funding for one particular youth employment program, Canadian post-secondary students were largely missing from the Conservatives’ 2012 budget.

“This federal budget is bad news for Quebec youth,” said Fédération Universitaire du Québéc President Martine Desjardins. “The reduction in grants for university research, for example, clearly shows the increasing place private corporations are taking in universities. We are also concerned to see that grants for social programs were lower than what the province asked and we worry about the consequences of these reductions on youth.”

Research and innovation
The Conservatives instead placed a clear emphasis on innovation and research funding, namely in the form of partnerships between businesses and universities. Among their plans, they intend to dedicate $14 million over two years to double the Industrial Research and Development Internship Program, which currently supports 1,000 graduate students in conducting research at private-sector firms.

The Conservatives also plan to send $6.5 million over three years to McMaster University for a health care research project, and will dedicate $500 million over five years to support modernization of research infrastructure on campuses through the Canada Foundation for Innovation, starting in 2014–15.

Paul Davidson, president and CEO of the Association of Universities and Colleges of Canada, called the investments “smart and strategic” and was generally supportive of the research funding proposals outlined by the Conservatives.

“I think Canadian universities can be quite proud and quite pleased that the government recognizes the central role universities play,” he said.

The 2012 budget marks the end of the stimulus phase of the government’s economic action plan and thus the end of the Knowledge Infrastructure Program, which provided nearly $2 billion over two years for construction projects at university and college campuses across the country. Budget 2012 reported that a total of 515 projects were completed under the program, and while five have yet to be completed, no further federal funding will be provided for those unfinished projects.

Katimavik funding eliminated
There were youth-related cuts in the document, too. Living up to rumours that swirled in the media in the days leading up to the budget, the government cut funding to Katimavik, a popular youth program that supported young Canadians traveling the country to participate in volunteer projects. The government announced its intentions to continue to invest in “affordable, effective programming” and that Canadian Heritage would pledge over $105 million in youth initiatives, though few details were provided.

Employment issues
In the area of job creation specifically for youth, the Conservatives only announced they would add another $50 million over two years to the existing Youth Employment Strategy, which, according to the government, connected nearly 70,000 youth with work experience and skills training last year.

While the government re-affirmed their plan to forgive student loans of up to $40,000 for new doctors and $20,000 for new nurses and nurse practitioners who plan to work in rural and aboriginal communities, starting in 2012–13, this plan had already been announced in last year’s budget.

Federal Green Party leader Elizabeth May also said she was “very disappointed” that no greater moves were made to relieve youth unemployment and student debt in the budget.

“The priority is to engage people so that we can put up the kind of cross-country response. We need to mobilize,” she said.

Nevertheless, thanks to their majority government status, it’s expected that the Conservatives will pass their budget plan with ease.

The government also announced its plans to eliminate the penny. Pennies will no longer be produced and distributed to financial institutions starting in fall 2012, though the coins will still be allowed to be used in cash transactions.

Dubois warned that the government was trying to “balance the budget on the backs of students and older citizens,” while May felt there was another clear message for young people among the financial proposals.

“You’re the victims in this,” the Green Party leader told Canadian University Press. “Anybody younger than 50 is the part of the population that gets kicked in the teeth in this budget.”

With Files from Joel Ashak