Recent cuts to the civil service will have a negative impact on an already strained local economy, but they could also mean increased opportunity for the private sector, according to the final report of the city task force examining the effect of government cutbacks.
The eight-member Service Delivery Impact Task Force struck last December to examine the impact in PG of the province wide reduction of 11,700 public sector jobs and cuts to government programs over three years said in their report that approximately 150 jobs were lost in PG as of March 13, representing a total loss of $6.65 million in wages.
They also estimated that the city would experience a direct cost of $400,000 in the first year of cuts, primarily as a result of increased Provincial Sales Tax, which is estimated will cost the city $150,000, and increased Medical Services Plan premiums, which will cost $200,000. Increased indirect costs to the city will come, says the report, as the government reduces involvement in services like transportation, infrastructure, animal control, municipal services and planning. The report did not, however, quantify how much those could cost the city.
Task force chair Frank Overand said that requests for funding from council will also go up as programs and assistance for the poor, elderly and disabled are reduced.
“I feel, and other members of the community feel, that council will see a lot more groups and people in front of them looking for help,” he told council Monday.
Cutting civil service staff and programs was one of the provincial government’s measures to tame a deficit that was predicted to top $4 billion if existing spending levels didn’t change. With the exceptions of education and health, all provincial ministries were ordered to reduce their budgets by 25 per cent over three years.
Task force member Vic Bowman said that employees in many ministries facing layoffs will find opportunities in the private sector, citing the example of a predicted increase in the demand for forestry staff at private companies with the shift to the new results-based Forest Practices Code.
“Overall there is a little bit of a downside to the community from this,” admitted Bowman. “But there are opportunities too. We have people now who are thinking about expanding their business and looking forward to better days.”
Mayor Colin Kinsley pointed out that permits for new housing starts, at 24 so far this year, are double what they were last year at the same time.
During their four-and-a-half month mandate the task force met with all three Prince George MLAs, solicited input from concerned local groups and citizens, and held a sparsely-attended public forum at the Civic Centre in March.
Overand recommended the city continue to monitor impacts as the three-year Liberal plan unfolds, and cautioned that the information contained in the task force report could quickly become outdated as the plan unfolds.
“If this report had been started a year later there would probably have been more concrete things to say,” he said. “But it was like herding cats every time we turned around things had changed on us.”
Council decided to forward the task force report to all three local MLAs, the Premier’s office and other stakeholder groups in the city.