Saturday, February 18, 2006

On fair-weather friends

The Cons may be doing their best to avoid promising any added money to the provinces. But Quebec's government made clear today that a cash injection just in time for a provincial election next year may be too late...apparently setting the stage the province to start making immediate demands:
Finance Minister Michel Audet said at a Liberal party general meeting here Saturday that pay increases to public-sector workers had diminished his fiscal breathing room and that he would need an extra $1.3-billion to make his next budget work...

Asked if he would raise hydroelectricity rates or increase the 8 per cent provincial sales tax to create a special fund to pay down the debt, Mr. Audet would only say that he was looking at several options and that it was too early to make any announcements.

“We have to pay our bills, that's the first thing. We have to balance our budget,” Mr. Audet said.
The article discusses a mostly internal debate as to whether the Charest government will push forward with planned tax cuts when the result would be a deficit that large. But particularly now that the federal Cons are making new demands of Quebec's provincial government, it won't be long before Charest needs to start pointing fingers to explain his province's fiscal situation. And there shouldn't be much doubt that Ottawa will be Charest's main target in the matter how friendly Charest and Harper may appear for the moment.

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