Some federal departments could face cuts of more than 10 per cent in the upcoming federal budget, Finance Minister Jim Flaherty says. He also says his government is taking a close look at the cost of public-sector pensions as part of its overall review of government spending.
The Conservative government is in the final stages of a year-long process that aims to find at least $4-billion a year in permanent savings from the roughly $80-billion a year that Ottawa spends on direct programs.
The government has asked all departments to submit plans of 5 and 10 per cent cuts, from which the Conservative government will choose from to find overall savings.
During a question-and-answer session with reporters after an event in Vancouver, Mr. Flaherty was asked how the government will decide which departments to cut and by how much.
“This is hard work. And of course, there can be numbers between 5 and 10 per cent and some departments can do more than 10 per cent,” he replied.
“What we have to do is end up where we want to end up and that is with a fiscal plan that will take us to balanced budgets in the medium term. That’s the plan. Different departments will have different results depending on their degree of their involvement in various types of programs and initiatives,” he said.
Mr. Flaherty went on to suggest that some departments may get off lightly if they are seen to provide direct services to Canadians.
“It won’t be a broad brush across government of everybody gets a 5 per cent reduction or everybody gets a 10 per cent reduction. The reason we don’t use a broad brush is it results in quite serious inequities, because some departments, for example HRSDC, human resources, deliver a lot of services to individuals,” he said.
The Finance Minister said no decisions have been taken as to the level of cuts in each department. The final calls will be announced in the 2012 budget, which is expected in February or March.
On the issue of whether changes are afoot for the pension plans of members of Parliament, Mr. Flaherty said that is a decision for the House of Commons Board of Internal Economy, not the government.
Mr. Flaherty said there has been “some progress” in talks with the public sector about reforming pension rules.
“Overall sure. I think we have to if one is going to make any sort of intelligent assessment of government spending in Canada. One has to look at the costs of remuneration including benefits and pensions.”
Original Article
Source: Globe
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