Newfoundland and Labrador’s Liberal government is slicing 287 management jobs from its civil service as part of a wider effort to contain a deficit currently projected to be close to $1.6 billion.
Premier Dwight Ball, who promised to avoid layoffs during the 2015 election campaign, said it’s a difficult decision but the province’s dire finances demand a “flatter, leaner” government.
Ball said he didn’t realize how serious Newfoundland and Labrador’s fiscal situation was during the campaign.
“It’s difficult because when those comments were made it was in a much different environment,” he said during a news conference on Wednesday.
He blamed Paul Davis, the former Progressive Conservative premier, for not telling him the size of the deficit during the electoral battle.
“The only individuals who had accurate information about the fiscal situation in the province was the former administration,” he said, as the former premier sat just metres away observing the news conference.
In an interview, Davis said his government had itself reduced the size of the civil service, and campaigned in 2015 on job cuts and tax hikes, precisely because the fiscal picture was clear as oil revenues dropped.
“If Mr. Ball didn’t know the facts of the state of the economy and the impact that oil was having on our economy then he must have just had his head in the sand. Everyone in the province knew where we were headed,” Davis said.
The province’s finance minister, Cathy Bennett, predicted the job cuts would save $20 to $25 million annually and said it is part of a wider push to meet current deficit projections.
“Our targets are ones we’re working hard to achieve. Whether we’ll hit it or not, we’ll let you know on budget day,” she said, adding she doesn’t yet have a date for the budget.
Ball said eliminating 17 per cent of the civil service’s management ranks won’t harm services.
“There are many opportunities for services not to be lessened or decrease. We think there are enough synergies there that the public service will be able to act more efficiently,” he said.
The premier also announced changes to several departments, saying that municipal affairs and environment will operate under a single cabinet minister, as will fisheries and land resources, and the departments of tourism and industry.
The department of intergovernmental affairs will include the office of Labrador affairs, and all government marketing operations will be consolidated into the government’s communications branch.
Bennett said 90 of the eliminated jobs are currently vacant, while the remainder of the total will result in immediate layoffs — adding that many of the employees were only learning of their fate on Wednesday morning.
She and Ball both cited a higher number of civil servants per capita than most Canadian provinces, but didn’t comment on whether they expected to make further cuts.
Bennett originally hinted at the possibility of the layoffs in January of last year, after sending directives to departments and agencies seeking savings of 30 per cent over the next three years.
Ball had warned at about the same time that the province faced the risk of credit downgrading if he didn’t take actions to control the size of the deficit.
The provincial government said in its budget last year that it intends to gradually return to a balanced budget in a seven-year process.