Opinion

Can you put a price on political pandering? If you're Manitoba Premier Brian Pallister, it adds up to a cool $1.3 million.

Can you put a price on political pandering? If you're Manitoba Premier Brian Pallister, it adds up to a cool $1.3 million.

Extensively reported Wednesday, the just-tabled 2021-22 provincial budget includes a controversial plan to send $190 million in education property tax rebate cheques to the owners of 658,000 tax-paying properties.

What was not included in the budget was the cost of physically mailing out the cheques.

According to finance department officials, it will cost $2 to cover the cost of each cheque, envelope and postage. With 658,000 property tax bills, that adds up to $1.3 million.

According to finance department officials, it will cost $2 to cover the cost of each cheque, envelope and postage. With 658,000 property tax bills, that adds up to $1.3 million.

The decision to offer a tax cut of this magnitude, amidst the economic uncertainty of the COVID-19 pandemic, is obvious political pandering, in and of itself. Wasting more than $1 million to do it via rebate cheque has to be the ultimate act of political self-aggrandizement.

In an email response to inquiries, a government spokesman said sending out individual cheques was the cheapest option available to process the rebate, without creating "extra administrative work, which would cost money."

However, that response ignores the fact there was a pre-existing mechanism to process property tax cuts: the one Manitoba currently uses to give those eligible an education property tax credit.

As property owners know, the annual tax bill shows the full municipal and education levies payable. The $700 provincial education tax credit is then subtracted from the education portion; the net amount is then paid to local government.

As the primary property tax collectors, municipalities must remit the entire education portion to the applicable school divisions. The province then sends municipalities a lump sum to cover the tax credits, so the municipality is not left in the lurch.

Premier of Manitoba Brian Pallister didn't include in the budget the cost of mailing out the cheques. (David Lipnowski / The Canadian Press files)

Premier of Manitoba Brian Pallister didn't include in the budget the cost of mailing out the cheques. (David Lipnowski / The Canadian Press files)

It's a complicated and, for the most part, silly process that has been built over years as governments have struggled over the mechanics of education financing.

However, even with its dizzying array of money swaps, it is a system already in place and one largely paid for by municipalities.

As far as concerns about added administrative costs go, this is a really good deal for the province, which does not help underwrite the costs of collecting school taxes (a point of some friction for municipalities).

The province does provide one service: it prints all of the tax bills sent out each year to property owners in every municipality, except for Winnipeg. But it charges municipalities for doing so.

Local government officials have been left scratching their heads about why the Pallister government didn't just increase the tax credit, or add a new line with a property tax rebate to the bills it has not printed for this year.

Local government officials have been left scratching their heads about why the Pallister government didn't just increase the tax credit, or add a new line with a property tax rebate to the bills it has not printed for this year.

"It's silly, silly, silly," said one senior municipal administrator.

It is, however, the best way for Pallister to ensure property owners know exactly who is providing property tax relief.

When questioned further on why the existing property tax credit process was not used for this rebate, a senior finance department official said it could not be done before tax bills are mailed out to property owners in May, or before the deadline for municipal taxes in June.

The Tory government intends on tabling a separate bill just to facilitate the property tax rebate, and there is no guarantee it could get through the legislature in time to meet either of those deadlines, the senior official said.

Left out of that explanation is the fact this government has frequently enacted measures without legal authority.

Local government officials wonder why Brian Pallister didn't just increase the tax credit, or add a new line with a property tax rebate to the bills it has not printed for this year. (David Lipnowski / The Canadian Press files)

Local government officials wonder why Brian Pallister didn't just increase the tax credit, or add a new line with a property tax rebate to the bills it has not printed for this year. (David Lipnowski / The Canadian Press files)

It has, for example, effectively frozen the wages of hundreds of thousands of civil servants, even though it has not proclaimed its wage-freeze law.

It's also worth noting the Pallister government made no attempt to expedite both the budget bill or the bill to enact the property tax rebate. Neither have been tabled in the legislature to this point.

Finally, the province will not commit to using the property tax bill system for future rebates. The senior finance official said government could well continue to mail out the cheques next year, and in subsequent years.

For a government that likes to portray itself as concerned about where every penny of taxpayer money is spent, squandering more than $1 million on rebate cheques seems like an uncharacteristically reckless thing to do.

For a government that likes to portray itself as concerned about where every penny of taxpayer money is spent, squandering more than $1 million on rebate cheques seems like an uncharacteristically reckless thing to do.

If this tax cut had been planned well in advance — given Pallister's propensity for calling political audibles at the last moment, there is no guarantee it was — surely the Tories could have developed a legislative strategy to get the necessary bills passed so they could use this year's property tax bills to deliver the rebate.

In fact, the government had 1.3 million good reasons to do just that. But it didn't.

Instead, the political calculus on the property tax rebates probably went something like this:

A total of 680,000 envelopes, cheques and required postage: $1.3 million.

One ill-timed, politically motivated tax cut: $190 million

Using a majority mandate to squander taxpayer money for an act of gross political pandering: priceless.

dan.lett@freepress.mb.ca

Dan Lett

Dan Lett
Columnist

Born and raised in and around Toronto, Dan Lett came to Winnipeg in 1986, less than a year out of journalism school with a lifelong dream to be a newspaper reporter.

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