In its 2010 budget, the Quebec government presents a clear and honest view of the dire fiscal situation that the province currently faces. For fiscal year 2009–10, the province is slated to post its largest deficit—$4.3 billion—since the recession of the early 1990s, and that number will rise to $4.5 billion in 2010–11. The province’s high debt level suggests that delaying a return to fiscal equilibrium is not an option for the government, and it had little choice but to squarely address the challenge of fiscal sustainability. Some highlights of the budget:
- The province’s high debt level suggests that delaying a return to fiscal equilibrium is not an option for the government.
- Health care—easily the largest spending component—will see growth capped at 5 per cent going forward. Furthermore, new health-care funds will be generated through the introduction of a “health contribution” that will raise $1 billion a year by 2012.
- A second consecutive 1 percentage point increase in the Quebec Sales Tax, to take effect on January 1, 2012, will pull in an additional $1.6 billion.
- The Quebec government has set itself the daunting task of restraining total program spending to 2.2 per cent annually after 2011–12.