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PBO says proposed new power risks it ‘becoming a political instrument’

Proposed legislation would give Parliamentary Budget Officer Jean-Denis Fréchette the power to cost party election platforms, if they asked.

Parliamentary Budget Officer Jean-Denis Fréchette says it's his job is to protect the independence and neutrality of his office, factors 'that are imperative for this office to have credibility.' The Hill Times photograph by Andrew Meade

By CHELSEA NASH

PUBLISHED : Wednesday, Nov. 9, 2016 12:00 AM

Parliamentary Budget Officer Jean-Denis Fréchette says the government’s intention to expand the mandate of his office to include costing of platform proposals at the request of political parties comes “with a lot of risk.”

In the government’s fall economic statement, released at the beginning of this month, an entire page was dedicated to promising more independence for the office of the budget watchdog.

Currently, the PBO is an officer of the Library of Parliament. To make it fully independent, the government proposed to put forward new legislation to make the role an independent officer of Parliament, provide it with more access to information from government departments, and, “Finally, as exists in other jurisdictions, the Parliamentary Budget Officer’s mandate will include costing of platform proposals at the request of political parties to ensure Canadians have a credible non-partisan way to assess a party’s fiscal plans.”

That last sentence has been met with hesitation by the PBO himself, as well as past members of the office.

  

Kevin Page, who was the PBO from 2008 through 2013, said it’s going to be a challenge that would involve the public service “supporting Parliament in a very different way.” He said other countries that currently use the PBO in this manner, including the Netherlands and Australia, have electoral systems that are very different from that of Canada. Both the Netherlands and Australia more frequently have coalition governments, and have more major contending parties than Canada does, he suggested.

Raymond Rivet, a spokesperson for the Privy Council Office, said in an email the government will introduce new legislation “to provide the PBO with a statutory mandate to provide parties with costings of platform proposals during election periods” in “due course.” He said the initiative “would provide for credible, non-partisan assessment of the financial costs of policy proposals made during elections, helping to inform the development and consideration of those proposals by parties and Canadians.”

Reports to Parliament generally aren’t tabled during election periods when Parliament is dissolved.

 

  

PBO conducting confidential business

Mr. Page said the major change would be that the PBO would have to start operating with departments and political parties “in a way that allows the exchange of information to take place in a confidential way so that they have access to the data and expertise to do proper costing.”

“Confidential work risks giving people the perception that you are favouring somebody, you’re withholding information,” said former assistant PBO Sahir Khan, who currently works at the University of Ottawa with Mr. Page.

Mr. Khan said the risks posed by the PBO conducting confidential work are too great.

“I think it is the single most important value of a PBO, to not only be objective, but to be seen to be objective,” he said.

  

Mr. Khan explained that in Australia, the PBO does confidential work for political parties throughout the year. This way, “it allows you to…build up a binder full of proposals, so by the time the writ’s dropped, [the PBO] already [has] a lot of that work done throughout the year.”

A document by the Australian PBO published in 2013 outlines that the PBO costs policy proposals at the request of Parliamentarians, (and/or parties), on a confidential basis outside the “caretaker period” for a general election, and publicly during the caretaker period of a general election.

Mr. Khan pointed to OECD guidelines for independent fiscal institutions, which state that “full transparency…provides the greatest protection of…independence.”

There are two caveats added as footnotes: first, there may be cases where confidential estimates may be kept as such “as part of the legislative process,” giving early estimates as an example. Secondly, “care must be taken to avoid the perception that the timing of the release of…reports favours the government or the opposition parties.”

 

 

Mr. Page said, “you would worry in a hyper-hyper-partisan electoral environment” such as Canada, that the PBO would become “some type of political” tool. But, he said it can be done in a way that manages risks. “There’s some significant positives.”

Mr. Page was open about acknowledging potential politicization of the office as a risk, but said as long as there are strict protocols in place to prevent that, he thinks this measure presents an opportunity for the PBO.

One suggestion he had was if the PBO was to conduct its confidential work with the parties and departments, once the parties’ platforms became official and public, the PBO would release a statement alongside them.

“We wouldn’t want that information going out in a confidential way, and Members of Parliament during an election campaign waving it around saying, ‘The PBO said this or that’ when we didn’t say it,” he said. If there was factual information presented by the PBO accompanying any costing measures, it could serve as a barrier against politicizing PBO information, he said.

Mr. Rivet said, “under the new mandate, costings would be provided by the PBO to the parties that request them, and made public.”

 

Potential for politicization

NDP MP Guy Caron (Rimouski-Neigette-Témiscouata-Les Basques, Que.), his party’s finance critic, said the benefits include a better informed electorate, and a better informed Parliament.

NDP MP Guy Caron said the NDP would 'absolutely' use the PBO for party costing. The Hill Times photograph by Jake Wright

NDP MP Guy Caron said the NDP would ‘absolutely’ use the PBO for party costing. The Hill Times photograph by Jake Wright

He said the NDP, which, having never been in government federally has never had the advantage of the resources available to an incumbent government, would “absolutely” use the PBO to cost the party’s platform proposals.

He said for all parties, including the governing party, “it’s something that will push us to be more rigorous.” He added that “sometimes I would expect that we might have a divergence, or differences with the PBO on the evaluation of the cost on some things, and that will be part of the debate during an election.”

But that is exactly one of Mr. Fréchette’s concerns.

“There will certainly be the risk of the PBO becoming a political instrument. A party will say, ‘see, PBO said this.’ This is a major risk of playing…one party against another one. Who will be right at the end?” he said.

Mr. Fréchette said another risk, which he said isn’t being talked about, is the influence any PBO reports could have on elections. “I won’t say the outcome of the election, I don’t want to go there,” he said, “but we should ask the question, ‘Where do we believe there will be some influence of those reports on the…trend, or the pattern, of the voting intention?’ I have no idea, but I can see it as the risk,” he told The Hill Times in an interview last week.

“I would be curious to know what the [chief electoral officer], Mr. Mayrand—what will he have to say about it?” he said. Mr. Mayrand’s office said he would not be available for comment on the topic.

Conservative MP Gérard Deltell (Louis-Saint-Laurent, Que.), his party’s finance critic, said the Conservatives are “open to discussion” about the measure, but acknowledged there are several challenges to be addressed.

“This is very touchy,” he said. There is a line between “partisanship and the objective reality of the fact” that must be drawn in order to maintain the independence of the PBO, he said. If the PBO is providing detailed fiscal updates six months, and three months before the fixed election date, so that political parties can all work off the same base information, “it will be a good start.” Parties can take the information, and politicize it from there. But, he said, if the PBO is analyzing political platforms, “every party could use [the] PBO [for] political purpose.”

“For sure, we all use the information coming from the PBO for political purpose. But the information from the PBO is factual about the reality of Canadian [public finances], not on the objective of political parties with [public finances],” Mr. Deltell said.  

Mr. Fréchette appeared to be more aligned with Mr. Deltell’s proposal.

“What would be possible is to prepare a baseline, like a couple weeks or a couple months before the election, particularly now that elections are at a fixed date,” he said. The baseline would outline economic trends, and the financial situation of the government. “The parties could use that baseline to do their own calculations,” based on the PBO’s projections, he said.  

Mr. Fréchette said in regards to the benefits, and risks associated with this measure, his message remains the same. “My job is to protect the independence, the neutrality of this office. Those are factors that are imperative for this office to have credibility.”

Mr. Page remained adamant that the extended mandate of the PBO could have meaningful implications.

“How [the costing] gets released will have to get worked out. They can do it. It will be incredibly challenging. It’ll mean opening things up behind the doors with different departments. The town will have to work in a different way. At the end of the day, what do we get? I think from a fiscal perspective, I think more confidence and credibility around opposition budgetary or fiscal plans. I think that’s well worth the effort,” he said.

cnash@hilltimes.com

@chels_nash