Tuesday, June 08, 2010

Congratulations, England! We're Going to be Royally F*cked!

Yesterday, David Cameron and his coalition government announced that in order to get the UK deficient in order, they are going to emulate the cuts the Canadian government made in the 1990s - notoriously known as Jean Chr├ętien's "bloodbath budget". It seems that the Motherland can learn something from its new world colony.

In 1993, Canada turned a 9 per cent deficit of £25billion - with a public debt of £341billion - into a surplus over three years in the 1990s by implementing huge cuts in health care and education budgets and through the loss of thousands of public sector jobs. By 1998, the deficit was eliminated and overall debt was dropping quickly, allowing Canada to get through the Asian crisis with little damage and go on to become one of the strongest Western economies.

Sounds pretty enviable...er, right?

What George Osborne won' tell you, however, is that the length of hospital waiting lists shot up, thousands of nurses lost their jobs and some hospitals even had to close. The hospitals that remained open suffered from overcrowding and infection rates rose as a result. In Ontario alone, hospital budgets were reduced by 18 per cent over three years and 1,000 nurses were sacked.

In schools, average class sizes shot up from 25 children to 35, as fewer new teachers were taken on. And separate special needs classes were abolished. Teachers also had their salaries cut by five per cent.

In addition, industrial and farming subsidies were hit heavily - with east coast fisheries being decimated, as were unemployment benefits and international aid. Transport spending was cut by a half and defence spending – the biggest source of savings – was whittled away to next to nothing.

What George Osborne also won't tell the public is that unlike America and the UK, Canadian banks have been under tight regulation since the early 1990s and such, we never really had the mortgage / market crash. Indeed, banks were much more conservative in their lending than our American and British counterparts. Canada's main banks chose not to sell most of their mortgages, giving them an incentive to ensure they were good loans; in 2009, subprime mortages had a 7% share of the market in Canada, as opposed to 22% in the USA

As a Canadian (albeit, a young one), who experienced the cuts in the 1990s - my high school teachers went on strike TWICE - I can tell you, it was painful. Accordingly, I can't even begin to imagine how it will take effect in the UK, especially in Scotland. That said, I am prepared for the worst but hoping for the best.


PurestGreen said...

I know a lot of young people who are just finishing their primary teacher training. They get a job for a year and then they are on their own, and already many of them are going to struggle to find work. But it seems many also just want to work in the big cities, where the competition is really high. With so many new teachers battling for jobs, it is easier for government to start cutting. Someone lucky enough to have found work is less likely to complain.

We all know that arts funding will be gutted -that always happens. More reliance of local charities for social assistance - I remember that in Canada in the 1990s.

David T. Macknet said...

Remember: NHS is devolved, as is Education. So, Cameron can do whatever he wants, it doesn't hit Scotland unless it's in some piece which isn't part of the devolved government.

Jennifer said...

Not true - where do you think the money comes from? Indeed, Scottish councils are going to have to cut £704 million:


David T. Macknet said...

So, London pays Edinburgh to run those services?