Tax cuts, not job security, threaten economy

Tax cuts, not job security, threaten economy

The contract between the Government of Manitoba and 14,000 civil service workers represented by the Manitoba Government and General Employees’ Union (MGEU/NUPGE) has garnered a lot of attention in the op-ed pages recently.

Business lobbyists, who have consistently pushed for cuts to public services and reduced compensation for the workers who deliver those services, have criticized the new contract’s inclusion of the no-layoff clause for the next three years.

MGEU/NUPGE members went more than 18 months without a contract until it settled with the government in a deal that included a no-layoff clause. 

Job security clause protects quality public services 

What these critics have missed is the critical importance of this clause to ensuring the quality public services that Manitobans expect and rely on will be there when they need them

Manitoba’s public services are already stretched thin. Recent media stories have revealed service deficiencies resulting from staff and resource shortages in a variety of areas including child protection, environmental protection, as well as agriculture and rural initiatives. This reflects the reality that over the past decade, only four provincial departments have seen regular funding increases, while all other departments have seen their budgets effectively cut or frozen.

Tax cuts mean less revenue for the province

More than 600 provincial jobs have already been cut in the past three years. These cuts have been imposed at a time when the province has been expanding programs and services to meet the public’s expectations for safer workplaces, clean drinking water, consumer protection, access to child care and more.

The cuts that have occurred have been largely necessitated by the loss of more than $1 billion in provincial revenue caused by 15 years of tax cuts — cuts that were lobbied for by the chambers of commerce. A large portion of these tax cuts has benefitted large corporations and high-income earners. For example, in 2015, Manitoba’s business community will pay $446 million less in provincial taxes than in 1999. From 1999 to 2015, businesses have saved $3.8 billion cumulatively in Manitoba taxes. If anything has tied the hands of provincial policy-makers and eroded Manitoba’s fiscal flexibility, it is these unsustainable tax cuts.

Poll shows government tax cuts out of sync with Manitobans' priority of protecting public services

Short-changing public services to provide tax cuts to those who need them least is not a priority for most Manitobans. Last year, MGEU commissioned a Probe Research public opinion poll that asked Manitobans to rank their priorities for government. It found Manitobans’ top priority, by a wide margin, was protecting services — well ahead of stimulating the economy, balancing the budget or reducing taxes. Three out of four respondents said their preference was that the government not cut jobs because this would harm services. And, well over two-thirds of Manitobans felt government should increase taxes on large corporations and the wealthy.

These priorities are reflected in the fact that none of the major political parties has expressed any opposition to the no-layoff clause for public service workers. Politicians of all stripes understand that Manitobans support the services that public employees provide, whether that’s in health care, education, justice, child protection, roads and infrastructure, or maintaining flood infrastructure. Manitoba political parties understand the no-layoff clause is consistent with their pledges not to cut public services. They get that quality public services require people to deliver them.

Cannot cut our way to prosperity — laid-off workers hurt the economy

The best way to generate the revenue needed to support public services is to grow our economy, a goal that is surely shared by the Chamber of Commerce. However, if we have learned anything since the most recent global financial crisis and recession, it is that we cannot cut our way to prosperity. Deep public-sector cuts and layoffs only hurt economic growth, exacerbating unemployment and budget deficits. Laid-off workers, public or private, draw more on public programs and spend less in the local economy, further dampening economic performance. Governments can support economic recovery by borrowing in the short run to invest in infrastructure, public services and jobs. These investments not only boost our economy, they also improve our communities.

Providing quality public services is in the best interest of all Manitobans. Families want to feel safe in their homes and communities and they want access to social supports when they need them most. Front-line services such as these all hinge on one thing, and it all starts with protecting hard-working Manitobans who deliver these services every day. We must stand strong together as Manitobans and reject calls for cuts and privatization because if we don’t, there will be no winners.