QUÉBEC, Nov. 20, 2012 /CNW Telbec/ - Today, Minister of Finance and the
Economy Nicolas Marceau tabled a balanced budget for 2013-2014. "After
four years of deficits, Québec will finally have a balanced budget," he
"However, to achieve this objective, adjustments are necessary because
of the substantial budgetary shortfall we inherited for 2013-2014 and
2014-2015. Letting things ride would be unworthy of a responsible
government. Consequently, we are taking immediately the steps necessary
to balance the budget in 2013-2014 and continue to do so in subsequent
years," the Minister said.
Strict control of spending growth
"In recent weeks, the government updated its financial framework and
took steps to offset the $1.6-billion shortfall for 2012-2013. We asked
the departments and agencies to come up with solutions and implement
the controls necessary to meet the spending targets established in
March. In the same vein, this budget forecasts that program spending
growth will be limited to 1.8% for 2013-2014 and 2.4 % for 2014-2015.
However, we are ensuring funding for the government's main missions.
The health budget will continue to grow by 4.8% per year. As for the
education budget, it will be increased by 1.8% and that of higher
education, by 2.0% for 2013-2014," the Minister announced.
He stressed that the government at large, including the agencies and
special funds, is being called on to help balance the budget. "We are
also calling for major efforts on the part of government corporations.
The Société des alcools du Québec, Loto-Québec and Hydro-Québec will be
asked to do their share. For example, Hydro-Québec will have to move on
improving its efficiency. It will therefore reduce its operating costs
in the short term by eliminating 2 000 positions through attrition.
This improvement in the government corporation's performance will not
affect consumer services. The additional efforts by government
corporations will total $290 million in 2013-2014," the Minister
"As well, the Auditor General of Québec will now be able to conduct
performance audits in government companies and their subsidiaries. He
will thus be able to ensure that government corporations are more
rigorous in managing the resources belonging to all Quebecers," he
The Minister also announced steps to reduce tax expenditures. These
steps consist in suspending two measures announced in the previous two
budgets with respect to experienced workers, and in including all
refundable tax credits for businesses in the calculation of taxable
income. These tightening measures will increase government revenue by
$68 million in 2013-2014 and $115 million in 2014-2015.
Lastly, he indicated that the stepping up of efforts to fight tax
evasion will enable the recovery of an additional $80 million in
2013-2014, bringing the objective to $3 866 million.
Improved management of infrastructure spending
The Minister announced that the level of capital investments as a whole
will be capped at $9.5 billion a year, on average, for the next five
years. This decision will save $200 million on depreciation and
interest expenditures in 2014-2015 and even more thereafter.
An additional effort regarding revenue
"We will ask banks and other financial institutions to continue and
increase their contribution to the efforts to restore fiscal balance.
The contribution of financial institutions, which was to end in 2014,
will be increased and extended to March 31, 2019. This will generate
revenue of $80 million in 2013-2014 and $211 million in 2014-2015," the
As well, the specific tax on tobacco will be raised by 2¢ per cigarette.
This increase will represent 50¢ per pack, or $4 per carton. The
specific tax on alcoholic beverages will also be raised. The increase
will be 3¢ for a bottle of beer, 17¢ for a bottle of wine and 26¢ for a
bottle of spirits. These two increases will bring in $130 million and
$100 million per year, respectively, as of 2013-2014.
Federal transfers: ten-year setback
"The government is hampered in its efforts to balance the finances of
the Québec nation by the federal government's unilateral decisions in
the past few years. In fact, we are witnessing a ten-year setback, to
the time when Québec as a whole was mobilized around the elimination of
the fiscal imbalance. Decisions made in 2008 with respect to the
equalization program and in 2011 with respect to the Canada Health
Transfer have had and continue to have adverse consequences on Québec's
public finances," the Minister declared.
He has asked the federal government to reverse its decision to impose
caps on the equalization program, and to gradually raise its share of
health funding to 25% within ten years. The Minister also deplored the
federal government's refusal to act on Québec's long-standing claim to
restore the Canada Social Transfer to its 1994-1995 level, at a
minimum, taking inflation into account. He noted that the federal
government's disengagement in this area represents a shortfall of $800
million a year.
A responsible government
"One of the paths that the government must follow is that of managing
our public finances with integrity and a keen sense of responsibility,
to preserve our ability to take collective action. The government's
good financial health creates a climate conducive to economic
development. It gives businesses confidence, encourages their
development and ensures Quebecers receive the quality public services
to which they aspire. Everyone benefits from sound management of public
finances—all of us as well as future generations," the Minister
Table of adjustments to the budgetary balance since Budget 2012-2013
SOURCE: Cabinet du ministre des Finances et de l'Économie
For further information:
Assistant Chief of Staff and Press Relations Officer
Office of the Minister of Finance and the Economy