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 Chrétien'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.
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.