This may seem counter-intuitive, but I think the government’s decision to postpone its annual budget until April or later is a signal that Stephen Harper is seriously considering a snap election this spring.
Consider the scenario. The Conservatives have been moving at a measured pace toward a general election on Oct. 19. The electoral pieces were being put in place. So confident was the government of its fiscal projections that it started to spend its anticipated 2015 surplus before it had the revenue in hand. Back in October, it locked in $4.6 billion in new tax and spending commitments (for income-splitting for parents and an expanded child tax credit). Continue reading
About the same time, world oil prices started to crater. By the time Finance Minister Joe Oliver presented his fiscal update in November, the price of crude was down to $81 a barrel. Not to worry, Oliver said. Oil will bounce back. It didn’t, of course. By last week, crude was down to $48, knocking the government’s revenue projections into a cocked hat. Canada won’t be an energy super power, as the Tories like to boast, any time soon.
The government won’t be able to afford income-splitting or the child tax credit, let alone any new election goodies. It will have to struggle just to sustain existing services without tax increases or more program cuts – or a return to deficit financing.
That would mean presenting a bad-news budget in February or March (the usual budget months). Caught between a rock and a hard place, Oliver (meaning Harper) postponed the budget. They say they need more time to gather economic information.
aybe. But I suspect they want time to retool their election strategy. It could go something like this. Around the end of February, Harper announces that world conditions have changed so dramatically, both in terms of the global energy picture and in terms of the international terrorist threat, that he needs a fresh mandate to provide strong leadership on these issues. There is no easy path. The return to a surplus will have to wait, as will tax breaks for Canadian families. The government will also be asking Canadians to support a package of tough anti-terrorism laws to make sure a Charlie Hebdo massacre never happens here. The election will be held in late April or early May. A budget will follow some time thereafter.
As a strategy, it plays to Conservative strengths – the perception that Tories are strong managers and wise stewards of the economy, along with their image of being implacable foes of criminals and especially terrorists. An April/May election would be fought on the basis of the challenges that will be facing the government and nation rather than on the record of Harper’s decade in office. Chances are even the Mike Duffy trial, due to begin in April, would get lost in election crossfire. Who really cares about a piddling Senate expense scandal at a time when the economy and the safety of Canadians are at issue?
Recent opinion polls offer support for a spring election. After trailing for two years, the Conservatives have pulled even with the Liberals in most polls, and last week a new Ipsos Reid poll put them four points ahead – 35 per cent to 31. This trend is not yet established, and 35 per cent is only enough for a minority government. Political analysts generally agree that, given the distribution of seats, a party needs about 38 per cent for a bare majority.
With their current momentum, a majority could be within the Tories’ reach this spring. The question Conservatives are asking themselves is this: Would it not be smarter to go now when the polls look promising rather than spend the spring and summer defending a bad-news budget, cutting spending, worrying about what the Saudi-led cartel may do with the price of oil, and watching anxiously for new terrorist eruptions?
By comparison, an election would be a stroll in the park.