Editorial Cartoon by Graeme MacKay, The Hamilton Spectator – Friday April 27, 2018
Auditor’s deficit allegations could be bad news for all parties
History, like politics, has a way of repeating itself. Especially at election time.
In opposition 15 years ago, Ontario’s Liberal Party smelled a rat. They accused the Tory government of the day of cooking the books.
Playing the reformist card in the 2003 campaign, Dalton McGuinty’s Liberals proposed that all future pre-election budgets be reviewed by the auditor. Upon winning power, McGuinty ordered a special audit that uncovered a deficit of more than $5 billion “hidden” by the previous Progressive Conservative government.
Fast forward to 2018. Now, the PC opposition is accusing the governing Liberals of playing with numbers — and this time, the auditor general of the day, Bonnie Lysyk, is on their side.
Lysyk held a news conference Wednesday to declare the Liberals are understating the true deficit by $5 billion.
The law of unintended consequences has a way of catching up to you. All that Liberal reformist zeal from 2003 is now fresh ammunition for the PCs as they accuse McGuinty’s successor as of fudging the numbers.
There is nothing new in the auditor’s latest report. But in auditing as in politicking, timing is everything. Which makes the Liberals electorally unlucky.
Few paid the auditor much heed two years ago when Lysyk suddenly declared she was reversing the accounting rules established by previous auditors: Accumulated surpluses in major public sector pension plans could no longer be counted as budgetary assets, as they had been since Tory times.
The effect of her ruling was to produce a gaping multibillion-dollar hole in the government’s accounting framework at the very moment they were striving to meet a 2017-18 target for deficit elimination. The government convened an outside panel of accounting and pension experts, who declared that Lysyk couldn’t have it both ways: Just as pension shortfalls count as a liability on the balance sheet, a pension surplus should count for something — not nothing, as the auditor insisted.
Lysyk still wouldn’t budge. But Bay Street didn’t bite, ignoring the auditor’s alarm bells. Credit rating agencies also looked at the books but didn’t buy into her alarmist assessments. (Continued: Hamilton Spectator)