Premier says he'll |

tackle the deficit —

Columnist Hubert Beyer
recently went one on one with
Premier Mike Harcourt.

In this segment, Mr. Har-
court lalks about government
spending. In ithe second seg-
ment, to run next week,
resource issues are addressed,

BEYER: Next week we'll get the
really bad news when the budget
comes down. Being somewhat
of a:layman in fiscal matters, I
still.came up with something in
the order of a. $2 billion-plus
shortfall that the previous ad-
ministration left behind,

. And, no doubt; in the first

year of your administration,

you'll be facing some shortfall
in the coming budget. Just how
big are’ we going to be hit with

‘lax. increases, necessary or

otherwise?

HARCOURT: Well, the

finances that we inherited were

amess. We're cleaning them up,
not just in the crown corpora-
tions like ICBC and the ferries,
which we dealt with already, but
as far as this year’s deficit is
concerned, | asked the new
ministers to get on top of it in

‘the first week, to cut out un-
“necessary spending, and. start
‘getting down the expenditures
jn this fiscal -year, let.alone the

next one,

We, of course, had the shock
that the budget deficit wasn’t
- $1.2 billion, as we were told by

the previous government, They
lied, because they had | the
figures that the deficit was $1.7
billion back in. August. They
misled the people of British Col-
umbia for four months. Since
then; we found out that it’s ap-
proaching : $2 billion. _Mean-
while, the deficit for the coming
fiscal: year was projected at $3.3
billion. ~-
“That. was totally unaccep-
table. So, during the estimate
process, I. set some very tough
targets: for treasury board
members and the ministers, and
in 21-days, they chopped over a
billion dollars for the estimates.
BEYER: That still leaves a $2
billion-plus deficit in the next
budget.
HARCOURT: No, I said we
’ would cap and reduce . the
deficit. We're poing to get the
deficit down to about $2 billion.
So, we're looking at. revenue
measures of about $500 million
to. $600 million.
- In the election. campaign, I
said we're committed to reduc-
ing the deficit systematically, in
an’ orderly way, over: the next
three or four years. We thought
it would take three years when
the deficit was $1.2 billion. Now
it’s probably going to take four
years. And we don’t want lo cut
the basic services, health,
education, social services.

» We're going to trim, and we
are going to use money betler,

Forester
hired

JERRACE — Forester Herb
Hammond is working for the
Haisla on an agreement that
would see the Kitamaal Village
natives join Eurocan Pulp and
Paper in-a model forest. pro-
posal.
’. ‘Hammond, who recently co-
authored..a book on B.C.'s
forest industry. and does work
forthe Nisga’a of the Nass
-Valley, was hired by Ecotrust, a
division of the American-based
environmental group Conserva-
tion International.
“He's known ‘and trusted by

native. groups,’ said Ecotrust
“spokesman Ken Margolis.
~The Eurocan Pulp and Paper
model forest proposal must be
submitted by the end of this
month. ©
~ The federal government pro-
. gram. provides money to carry
out studies aimed at solving
land ‘use conflicts such as the
Kitlope.- 8

~ Margolis “said the model
forest: proposal could help solve
‘the’ Kitlope . dispute and bring
‘money-lo. the region. -
“The company lists the Haisla

‘as’ well’ as several other en-

ironmental groups and govern-

ment agencies as potential part-

ners in the project.

“He would bring in $5 million

"© over. five years,’*-Margolis said.
“It would-be exiremely impor-
tant for the region.”

Premier Mike Harcourt

“We, of course, had
“the shock that the
budget deficit wasn’t
$1.2 billion, as we were
told by the previous
government. They lied,”

but we don’t want to cut. Now,
the financial framework that we
set cut in the election campaign
said there would be some
revenue measures, not to add
new programs, but strictly to
deal with the Federal off-loading
of the cost of welfare, for exam-
ple, and to cap and reduce the
deficit.

BEYER: No new programs, you
said?

“We are going to
squeeze more value out
of existing tax dollars,
and we think there is lots
of scope there.”

ti ce asl eweg

HARCOURT: Not unless it’s
within- existing budgets. You
change priorities or you cut out
waste. The ministers got a very
clear message, yes, we're going
to bring in some new programs,
but you’ve got to cut some old
programs and cut out some
waste.

The revenue measures are
strictly for two purposes, to cap
and reduce the deficit and not
leave that slippery slope of in-
creasing deficits, where you add
interest on, and it componnds,
and you get into the mess we're

in federally.

And secondly, to deal-with
the federal off-loading, like $20
million in extra welfare costs
this year alone. ©
BEYER: If I may put that into a
different perspective. Am | cor:
rect that given a shortfall of
about $2 billion the last govern-
ment left behind, plus a $2
billion deficit for the coming
fiscal year, we'll be paying $400
million a year at 10 per cent just
to finance those two deficits?
HARCOURT: Ili’s down to
about seven per cent.

BEYER: Alright, seven per
cent. That still makes for $350
million a year. Can you, under
those circumstances, still
achieve a balanced budget
towards the end of your present
mandate?

HARCOURT: Yes.

BEYER: You still stand by
that?

HARCOURT: Yes.

BEYER: How?

HARCOURT: We are going to
do it. I’m not promising any
miracles, but we've got to do it,
because if you don’t, you'll end
up with 35 per cent of your
budget going into interest
payments, as they are federally,

We are going to do it by
changing spending priorities,
We reduced some areas in
education and came up with $7
million for the school meals
program for hungry school
children. We shifted some other
resources to come up with $1.5
million for immigrant recep-
tions societies, We'll continue
to do.that within existing and,
in some cases, reduced budgets.

We'll cut out waste. We think
through the estimate process we
discovered a whole series of
areas where we can squeeze
more value out of tax dollars.
We have to spend better,not
more, and do more with less.
The ministers all know that, and
they know where their depart-

_ ments have the weak spots.

We'll have value-for-money,.
audits, we're going to do somes
zero-base budgetting. We are
going to squeeze more value out
of existing tax dollars, and we
think there is lots of scope
there.

They’ve never asked these
questions at treasury board:
Why does this program exist?
Well, because it exists, is usually
the answer you get back. Well,
does it need to continue? Can
we do it a different way? Can
we combine programs?

So, there are all those ques-
tions we are going to be asking
incrementally, now that we're
through the estimate process.

Terrace Standard, Wednesday, March 18, 1992 — Page A13

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