Quebec budget 2014: Philippe Couillard's 1st real test

The Couillard government's budget will be the first concrete glimpse at the direction the Liberals wish to take Quebec over the next year and beyond.

With public finances awash in red ink, don't expect dazzling new spending announcements

Premier Philippe Couillard’s government is facing a budget deficit of $3.7 billion and has already warned of substantial spending cuts. (Canadian Press)

No single action by a government expresses its plans, dreams and hopes for the future as much as its budget.

A budget introduces new programs, such as Quebec's universal affordable daycare plan. Budgets also announce to financial markets the province's intention to get its house in order, notably by reaching zero-deficit spending after years of red ink.

The Couillard government's first budget, then, will be the first concrete glimpse at the direction the Liberals wish to take Quebec over the next year and beyond.

No big surprises

But don't expect it to include dreamy new programs or an easy path toward balanced spending.

Why? Because, as the auditor general's special report on public finances concluded on Monday, projected deficit spending in the next fiscal year is a whopping $5.6 billion — more than three times what the Parti Québécois predicted in its last budget just weeks before an election call last March.

That means the cupboard of Couillard's freshly elected government is beyond bare. Not only that, in order to prevent a downgrade in the province's international credit rating (which in turn would lead to a rise in interest payments on the province's debt) a clear demonstration of belt-tightening will have to be made.

Sacred cows

That's no easy task in a province where so many public services are sacred cows. Few are holier than affordable subsidized daycare, which currently charges parents just $7 day by pumping some $2.3 billion in subsidies to provide those spaces.

The budget will likely introduce an indexation clause on what parents pay. But analysts doubt that will help keep up with the rising cost of the popular program over time. The Liberals swatted away criticism over a suggestion last week that daycare charges would be modulated according to the income of parents. The commitment not to go there, however, was only explicit for this year.

Finance Minister Carlos Leitao says his first budget will serve as a "transition to a situation where we again master our public spending, to be free in our choices."

In other words, Quebec has to stop spending beyond its means.

Caretaker budget

With so many sacred cows leaving so few places to cut, that will be an onerous objective to meet quickly. Combined with Quebec's fragile economic recovery, and job creation being at front of mind for most, slash-and-burn spending cuts in the public sector would seem unthinkable.

After only about seven weeks on the job, the rookie finance minister has had virtually no time to lay out the Liberal financial blueprint. Monday's document could turn out to be a kind of "caretaker" fiscal plan, leaving many of the more difficult decisions to next year's budget.


Tim Duboyce was a news editor at CBC Montreal. He was CBC's correspondent at the Quebec National Assembly from 2003 to 2013, and has covered five Quebec provincial election campaigns.