Letter to New Brunswick’s Political Leaders
July 27, 2014 | 0 Comments
Members of the New Brunswick Business Council have a fierce loyalty to this province. We want to see it thrive and grow in the future. We have spent much time thinking about how to help strengthen our province, and have prepared this letter to convey 3 themes for leading New Brunswick after the next election:
1) Fiscal Fix
3) Act Fast
1) Fiscal Fix
Our debt has been increasing consistently for nearly a decade, since 2005. In fact, in the last 30 years, NB’s debt has only decreased 6 times and each time meagerly so. Interest rates are low right now and very likely to rise in the future. Now is the time to eliminate our deficit and start paying down debt before we are hit with interest rate increases that will push our debt service costs to crippling levels.
In addition, a balanced budget allows us to take on a new narrative. Today, it’s difficult to invest in growth opportunities when the amount spent to service our debt exceeds all other departmental budgets except health and education. Below are some suggestions on how to balance the budget and begin reducing our debt:
Like most start-ups as well as growing businesses, capital is required for government to achieve its goals. We believe that an HST increase is the fastest, most equitable and least damaging way to generate significant revenues for government. Such a measure could be time-bound, as in Nova Scotia, in order to ensure that the funds are focused on immediate deficit reduction, and repealed once budgets have balanced consistently. It could also be introduced with measures to shelter our most vulnerable citizens, such as new exemptions or credits on heating tax, an increase to the low-income threshold and more.
We recognize that committing to raise the HST is not a popular election strategy, but we hope that courageous political leaders will have the strength to avoid promising not to raise this fairest of consumption taxes during the campaign period. We will applaud those that do not.
Similar to our start-ups as well as businesses that are managing through changing times; streamlining, bootstrapping and getting lean are key activities on the path toward earning investment, surpassing competitors and reaching profitability.
More aggressive cuts to our expenses are required in order to pay down our debt and generate funds to invest in growth. 2% expense growth cannot be acceptable when revenue is growing at < 1%. Some aspects of government require fundamental change and complete modernization, rather than trimming at the edges. For example, private models of payroll delivery could be implemented. Mobile services could be set up in place of bricks & mortar branches. Sale, consolidation and new uses for our infrastructure should all be considered. We have specific ideas on how to achieve this that we would be happy to discuss with you at your convenience.
With urgency, clear focus, and a mindset to be smart, digital and fast, we think the next government will be successful in tackling the most critical near-term challenge – balancing the budget. Below you’ll find our thoughts on these critical leadership principles for government:
In order to make change during your mandate, you’ll need to prepare your team and organization today for what’s ahead. We have learned that successful leaders provide FOCUS, and employ strategic management structures in order to create an environment of accountability, performance and results. We encourage you, as political leaders seeking to govern come October, to plan your teams, reporting lines and systems thoughtfully to support the achievement of 3 focused priorities over the next 4 years in office.
Too often, we have seen CEOs and political leaders alike crumble under the weight of a thousand priorities. We all want to offer every feature and product that our customers request, and in trying to meet these demands we deplete our finances and burn out our employees. In the end, our customers’ demands continue to escalate and our companies go under. We believe successful governments and companies identify where they can best add value, and partner or outsource where they don’t have a competitive advantage.
Tomorrow’s government should align multiple departments to clear, measurable goals and share those goals with the public. They should be laser-focused on the achievement of those goals in the face of pressure to respond to every interest group’s wish list. Any initiative that falls outside of the goals should be pushed out beyond the 4-year term to give the government a chance to achieve real progress during our legislative cycle.
3) Act Fast
Using a framework of being smart, digital and fast, government should focus on streamlining systems and policies through the adoption of technology to ensure New Brunswick has the fastest and most efficient government in Canada. We can use our small size as an advantage to continue to lead new technology roll-outs such as FibreOp and SmartGrid. New Brunswick can be a hotbed for the world’s new technology ideas to be developed and tested.
Adoption of technology in health care, education, purchasing, transportation, shared services, natural resources, economic development and more will help create an environment where decisions can be made quickly, residents served satisfactorily and growth achieved measurably.
Government needs to move at the speed of its citizens and opportunities. Like Service NB once did, we could again provide the most rapid service to residents and businesses starting new ventures, seeking information, approval or regulatory clarity. Using the right management structures and technology, decisions could be made, policy developed and, where required, programs delivered more rapidly and efficiently, providing a more growth-friendly environment for citizens and businesses alike.
Our message of hope for New Brunswick is that we are a province that can GROW! We have a proven history in growing wood, potatoes, fish, as well as growing our people and enterprises. Moving forward, we believe New Brunswick should focus on deploying our assets for their maximum productive use, whether that be leveraging our increasing population of seniors to accelerate community development or participation in the growing health care technology sector or our large deposits of shale gas to facilitate our growing engineering and environmental services sectors. Fixing our fiscal crisis, focusing, and acting fast will help bring our province into a phase of growth we desperately need.
Your comments are welcome.