The Quebec government will release its next economic update on November 25. The Minister of Finance, Eric Girard, will then want to give Quebeckers the true picture on the evolution of the Quebec economy, on the government’s financial situation and on the implementation of several measures to improve the economic situation.
Among these measures, there will certainly be several to better cope with the shortage of workers and to correct certain major flaws in the government offer of essential services to the population.
We are in a pivotal period where we hope to gradually emerge from the pandemic, continue the economic growth before the pandemic while repairing the damage caused by the pandemic itself and better protecting the environment. We hope to do all this while the accelerated aging of the population will generate for the next 15 years a shortage of workers and a sharp increase in the demand for care produced by the public health system. And in addition, the government will want to continue to gradually reduce the weight of its debt. He will therefore have before him a very ambitious program, almost impossible to achieve fully. I have no doubts: the government will have to define a list of priorities and make difficult choices.
To achieve all this and to make the best choices, it seems to me essential that the government have a long-term plan over a horizon of at least 15 years, until the moment when we reach the peak of the aging of the population and where the labor shortage will begin to subside.
The government, like many others, has prepared very poorly to deal with the aging of the population, even though this shock was very well anticipated decades ago. Similarly, infrastructure management has also been poorly planned, whether in terms of acquiring new assets or keeping existing assets in good condition. In these two cases, planning and management over a too short period of time explain a not insignificant part of these failures.
Beyond the electoral cycle
Relatively detailed five-year budget plans need to be based on a less detailed long-term plan that helps the government make the right choices to get through much of the shock of an aging population and to best protect our country. environment. We have to go beyond the four-year electoral cycle. We must stop putting off putting in place the necessary measures. You have to have a long-term plan. This is my first wish for the next economic update.
You need to have a good idea of what the future average growth rate of GDP, government revenues and demand for various government services will be. Using simulations, the government will seek to find the best combination of measures to maximize the well-being of Quebecers. Among these measures, we will have to choose those that will best alleviate the labor shortage, including the immigration thresholds we want for the next 15 years.
My second wish is linked to the need to plug the loopholes in the government offer of essential services to the population. These flaws have become more evident in recent years.
Here, I am talking about major flaws in several areas: the care offered to the elderly, the care offered to people with mental illnesses, the services of the DPJ, assistance to students in difficulty (the extent of the delays greatly increased during the pandemic). Several of these flaws had been denounced long before the start of the pandemic by independent, knowledgeable and credible stakeholders. Too often, the government has minimized them or implemented solutions that have not worked or had only a minor effect.
It is time for the government to be more transparent and make plans to address these shortcomings and take action to address long-term issues that have caused a huge loss of well-being for many. vulnerable people and even loss of life. The update must present solutions and reassure the population that these flaws will be fixed and will not reappear a few years later.
Infrastructure
My third wish is that the government define for the next 15 years a specific target for its infrastructure assets (and their loans). This target should be accompanied by a budget envelope for its investment program (PQI) which will be used to finance both new investments and the maintenance of its existing infrastructure in good condition. We must avoid a repetition of what happened during the last decade when we saw the implicit target for these assets get squeezed in the corner in order to obtain a faster reduction than initially expected in the ratio of the asset. gross debt to GDP. The government must consider that the debt related to these assets is not a bad debt (one that has no counterpart assets) and that it will have to transfer infrastructure in good condition to future generations.
Finally, my fourth wish is that the government incorporate in its long-term plan a target for the reduction of the ratio of accumulated deficits (bad debt) to GDP without significantly reducing the ability of Quebec 1- to weather the shock of aging of its population, 2- to close and erase the major loopholes in its offer of essential services and 3- to invest significantly in environmental protection. It will also be necessary to avoid reducing the accumulated past deficits faster than the average pace implied by this target, by successively achieving additional budget surpluses (or surpluses) which would cause, once again, the appearance of new major flaws in the economy. offer of essential services to the population.
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