Focused on austerity, the government appears to be ignoring tax policies that have the potential to bring in billions to the provincial treasury.
The ruthless slashing of public sector funding – including the current freeze on base funding to Ontario’s hospitals – appears to be more ideologically based than on sound economic policy.
As we have previously noted, cutting public spending also creates a fiscal drag on the economy. Public sector workers spend their earnings in the community, generating economic activity. When government puts the squeeze on them, it puts the squeeze on everybody by reducing economic growth.
We have seen how both the Harris and McGuinty governments reduced revenues by slashing the corporate tax rate. Less discussed are substantial exemptions to the Employer Health Tax (EHT), introduced in the late 1980s to replace the previous OHIP premiums.
When the EHT was introduced, it featured a graduated rate structure – the only one of its kind in Canada. For employers with annual payrolls of less than $200,000, the rate was 0.98 per cent. For employers with more than $400,000 in payroll, the rate increased to 1.95 per cent.
The Ontario Hospital Association is disappointed again.
This week Dwight Duncan announced the government’s intention to cap salaries for new employees in the broader public sector – including hospitals – to $418,000 a year, or double Dalton McGuinty’s salary.
The idea had gained some traction in the last election when the NDP proposed it as a way of reining in rising executive salaries in the broader public sector.
The OHA issued a release this week in which they used the 2010 public sector salary disclosure to show that only 77 of the 207,000 people employed by Ontario’s hospitals earned more than $418,000 per year. Assuming those folks were rolled back to double the Premier’s salary (which Duncan is NOT proposing) it would save $4.7 million. If applied to all BPS employers, it would amount to $7.3 million.
Given it only applies to new employees, the University Health Network’s Bob Bell, for example, would get to hang on to his almost $754,000 earned in 2011.
“This is another example of the Government of Ontario and legislators devaluing the work and skills of hospital leaders, and those who lead Ontario’s vital BPS organizations,” the OHA said in the release.
Obviously OHA President and CEO Pat Campbell trotted out the 2010 figures because they happened to be on hand from last year’s response to the NDP campaign pledge. We actually took a look at the 2011 disclosure and found one less body in the more than “double the Dalton” club. However, with all those registered nurses barely creeping into the sunshine list, it would be easy to overlook a couple of high flyers.
Posted in Uncategorized
Tagged Bob Bell, BPS Salary cap, Cliff Nordal, Debbie Sevenpifer, double the Dalton club, Dwight Duncan, Executive Salaries, Glenna Raymond, OHA, Ontario Hospital Association, Pat Campbell, Rob Devitt
In February we attended a forum hosted by the Centre for Policy Alternatives looking at the manufactured crisis the Liberals are using to bring in a far-reaching austerity agenda.
At the time, we noted that Finance Minister Dwight Duncan has a consistent history of grossly exaggerating the forecast deficit. In 2010-11 Duncan was off by 43 per cent with his forecast. Progressive economists were forecasting the actual deficit for 2011-12 would not be $16.3 billion, but come in closer to $12 billion.
They weren’t far off.
There was little attention last Thursday when Finance Minister Dwight Duncan revealed last year’s deficit was in fact $3.3 billion lower than forecast, coming in at $13 billion.
Dalton McGuinty is threatening to pull the plug on his own government after the opposition parties amended his budget bill yesterday in the legislature’s finance committee.
Like the Harper government budget bill, the McGuinty government inserted a large number of legislative amendments to create a massive omnibus bill. Many of these the NDP and Conservative opposition stripped out yesterday with their 5-4 majority on the committee.
Among them is the controversial Schedule 28 which would give the government enhanced latitude to privatize public services without returning to the legislative assembly for debate and approval.
McGuinty claims the Schedule is to facilitate the complete privatization of ServiceOntario, itself a mistake. High-profile lawyer Paul Cavalluzzo accompanied OPSEU President Warren (Smokey) Thomas to the legislative committee last week to point out that such privatization potentially opens up serious privacy concerns given U.S. subsidiaries would be forced by American law to share sensitive information gathered by ServiceOntario with the American government.
David Orazietti does protest too much.
The northern Ontario MPP took a shot May 30th at Natalie Mehra, Director of the Ontario Health Coalition, in what his press release calls the “15-city fear mongering tour.”
Orazietti says Mehra is personally “taking every advantage to distort the truth.”
Of course, prior to the NDP holding their feet to the fire over passage of second reading of the budget bill, the McGuinty government had failed to hold its own public hearings on the budget, an unusual state of affairs particularly given the significant austerity package cobbled together by Finance Minister Dwight Duncan.
If we are to suddenly change directions, should the public not have a say in what transpires?
CCACs hire 144 direct care nurses
This month the government announced 900 new nursing positions to come from their 2007 commitment to 9,000 new nurses for the health system. Among them are 144 nurses who will go into the schools to support early identification and intervention of students with potential mental health and/or addictions issues. The nurses will assess and develop plans of care, provide direct service for mild cases, and offer support and referral for more complex issues. What’s particularly interesting about this initiative is these nurses will be working directly for the Community Care Access Centres, the first new hires to provide direct care since Bob Rae was in the Premier’s seat. When Mike Harris changed the NDP’s multi-service agencies into the CCACs, he insisted that a strict purchaser-provider split exist, hoping to divest all direct care workers to private agencies. He never entirely succeeded – OPSEU still represents CCAC home care therapists that were supposed to be divested by 1998. The fact that the government has placed these nurses into the employ of the CCAC is a hopeful sign that the terrible Harris-era competitive bidding process may quietly be coming to an end. While Deb Matthews publicly said competitive bidding would return, OPSEU members are telling us the agency contracts are all being extended again.
Merging surgical departments in Windsor
A zero base budget for hospitals is forcing many administrators to look at novel ways to make ends meet. In Windsor much has been made about Finance Minister Dwight Duncan’s proposal for a very expensive mega-hospital, however, the two hospitals are looking at integration options that might save money in the meantime. Windsor Hotel Dieu is pushing for greater coordination of surgical departments with the Windsor Regional Hospital. Facing a $700,000 operating room budget deficit, Dieu is hoping costs could be saved by having the two hospitals move into even greater specialization than currently exists. Dieu presently specializes in trauma and neurosurgery while WRH does most of the pediatric surgeries. WRH CEO David Musyj told the Windsor Star he was cautious — concerned that Hotel Dieu’s financial problems could put more pressure on his 11 operating rooms.
Harper attacks Council of Canadians
Our friends at the Council of Canadians are under attack by the Harper government for encouraging Canadians to overturn elections of seven Tories elected in ridings involved in the so-called robocall scandal. According to the Ottawa Citizen, the Federal Tories hope to overturn lawsuits that seek new elections in the ridings. The Tories are basing their bid to throw out the lawsuits on an obscure and ancient legal prohibition against “champerty and maintenance,” which the Citizen describes as “meddling in another party’s lawsuit to share in the proceeds.” While the Council of Canadians would not stand to gain anything monetarily from the actions, the Tories highlight a Council fundraising campaign that notes the challenge among its work. Of course the Tories have no problems with right-wing organizations, many with American funding, helping to litigate against such left-wing institutions as Medicare. That includes the Canadian Constitution Foundation, an extreme right-wing group based in Alberta that supported Lindsay McCreith and Shona Holmes in their 2007 case intended to open up Ontario to two-tier private health insurance. While the CCF doesn’t say where their money comes from, they do specifically note on their website that they have charitable status with the U.S. Internal Revenue Service. Like the Council of Canadians, the CCF lists its McCreith/Holmes case as among the worthy activities it undertakes to solicit donations.
Posted in CCAC, Home Care
Tagged 900 new nursing positions, Council of Canadians, David Musyj, Deb Matthews, Dwight Duncan, Lindsay McCreith, right wing advocacy groups, Shona Holmes, Windsor hospital merger, Windsor Hotel Dieu, Windsor Regional Hospital
While cancelling the new $136.8 million West Lincoln Memorial Hospital in Grimsby, along with cuts to five other hospital projects across the province, Finance Minister Dwight Duncan announced a task force to look at building a new $1.5 billion regional hospital in his Windsor constituency.
The new super hospital would replace both Windsor Regional Hospital and Windsor Hotel Dieu. This is even though both hospitals have undergone recent additions, including a $91.6 million mental health facility at WRH and an $80 million cardiac care expansion at Hotel Dieu. Last year the government also approved a $60 million expansion of WRH’s ER and laboratory facilities – a project that wasn’t shelved as part of the McGuinty austerity budget.
Despite more than $230 million in new builds at the two hospitals – almost twice what it would cost to rebuild West Lincoln, Duncan estimates the Windsor hospitals will require another $1.8 billion in new capital projects to keep the two hospitals operating.
David Musyj, CEO of Windsor Regional, says both the buildings and the site are physically inadequate for what’s needed in the near future.
It’s no surprise that the root cause of the recent recession would be eventually reinterpreted to blame the public sector.
Now that the bankers and the auto industry have now renounced their brief flirtation with socialism, it seems we are told our problems stem from us little people having it too good when it comes to health, education and other public services.
Even the ever apoplectic Rex Murphy blames Premier Dalton McGuinty for the sudden state of the province’s finances, and not the bankers who crashed the economy and suddenly put a big hole in Ontario’s gross domestic product (GDP).
Federal Finance Minister Jim Flaherty, blowing harder than usual these days, says Ontario has fundamental budget problems – “major spending problems that they’ve built up over the course of eight years.”
Don Drummond certainly knows how to manufacture a crisis.
For several years now he has been telling us that public health care spending is out of control, and that if left unchecked, it would soon consume 70 per cent of the provincial budget. Since those projections, spending on health care has actually gone down as a share of provincial program spending, from 46 per cent to 42 per cent.
Oddly, despite a trend line going in the opposite direction, Drummond continues to maintain this forecast.
Now, as Commissioner for Public Service Reform, he is telling us that if we don’t enter into a period of extreme austerity, we will soon be the Greece of Canada.
Don’t break out the tzatziki sauce yet.