By Mr. STEVE MCLELLAN, Chief Executive Officer, Saskatchewan Chamber of Commerce. 
 @SkChamberSteve | Steve McLellan |  smclellan@saskchamber.com 

Mr. JOSHUA KURKJIAN, Director of Research and Policy Development, Saskatchewan Chamber of Commerce
Joshua Kurkjian |  jkurkjian@saskchamber.com 

Saskatchewan is a province noted for its stark contrasts. These contrasts are evident, most notably in our geography and climate but also in our political culture and unique brand of electoral politics. Saskatchewan’s almost folkloric social democratic tradition and DIY co-operative spirit exists (often uneasily) alongside its equally storied reputation for developing (and exporting) rugged, innovative entrepreneurs. Saskatchewan today is equal parts Tommy Douglas and Brett Wilson. Our provincial economy is marked by state ownership of key industries such as auto insurance and utilities that operate alongside private sector resource-based businesses competing in a hypercompetitive global marketplace.

With this juxtaposition in mind, our central argument here is that neither the newly re-elected centre-right Saskatchewan Party (Sask Party) nor the left-leaning opposition New Democratic Party (NDP) this time around proposed any grandiose ideas or suggested a major course change. Instead, party platforms focused more on practical measures, such as getting money in the hands of businesses and households and getting people back to work. The need for the parties to address voters’ more pressing COVID-19-related concerns about economic recovery and health care amidst a second wave likely served to temper parties’ bolder policy ambitions.^[1] This piece will illustrate this point further by citing specific examples in the following areas: business taxation, childcare affordability, and government procurement.

Business Taxation

Neither the Sask Party nor the NDP policy platforms articulated any sweeping changes on the business taxation front. The Sask Party’s proposal to reduce the provincial small business rate (SBR) from the current two per cent to zero per cent over two years is a temporary measure that will likely be well received by small business owners, a key constituency group for the Sask Party.^[2] This proposal would benefit about 31,000 of Saskatchewan’s roughly 40,000 incorporated small businesses that maintain payroll.^[3] While reducing the SBR to 0 per cent temporarily will provide much-needed tax relief for small businesses, not mentioned in the Sask Party platform was a pledge to reduce the higher general corporate rate or reduce the differential between the SBR and the general corporate rate as a means to encourage small businesses to scale up.  

Instead of promising to lower statutory corporate rates across the board, the NDP opted for targeted tax measures, such as reinstating the film tax credit, bringing back start-up loans for rural small businesses, reducing the province’s regressive craft beer levy to assist homegrown producers compete, and removing the PST on construction labour that has been a thorn in the side of the industry since 2017.^[4] No doubt these measures were developed with key groups in mind, such as creatives in the film industry, craft brewers, rural entrepreneurs, and workers (and their trade unions) operating in the building trades.

Other established parties with no representation in the legislature also included targeted tax measures in their platforms. The Liberals promised to eliminate the PST on insurance, modernize the tax system by adjusting income tax brackets for inflation (bracket creep), and reinstate the film tax credit.^[5] The Progressive Conservative Party wanted to ‘create’ a manufacturing tax credit^[6], reinstate the potash production and film tax credits, as well as remove PST from select goods.^[7] It is noteworthy that none of the established parties proposed a review of the province’s tax system or significant tax policy changes such as GST/PST harmonization or even PST recoverability for businesses.

Childcare Affordability

The COVID-19 pandemic and the ensuing economic shutdown exacerbated existing childcare affordability challenges faced by parents. Both the Sask Party and the NDP pledged to make childcare more affordable, but each party approached it from a different angle. In true small-c conservative fashion, the Sask Party’s approach to achieving childcare affordability was more supply-side focused. Its pledge to create 750 new spaces over the next four years is focused on reducing the up-front costs borne by licensed daycare providers with the expectation that those cost savings would be passed along in the form of lower daycare costs for parents.^[8]

In contrast, the NDP pledged to create 2,200 new spaces every year, deliver subsidized $25 per day childcare, and conduct an expert panel review of the childcare system.^[9] The Liberal platform included a vague promise to make quality licensed daycare affordable for all low- and middle-income families.^[10] While parties may differ on specific actions around childcare, they do so only by varying degrees. COVID-19 has forced parties of all ideological persuasions to make childcare affordability a way to promote labour force (re)attachment, particularly among women who often find themselves tasked with caregiving duties. Promoting childcare affordability will be crucial to helping Saskatchewan businesses remain competitive. It will go a long way in ensuring workplaces have available to them the skilled workers they require.

Government Procurement  

Both Sask Party and NDP policies around government procurement for this election were shaped heavily by the massive disruption to established supply chains brought on by COVID-19 and the need to retool government procurement policy to ensure that Saskatchewan workers and businesses enjoy the full stimulative impacts of an unprecedented COVID-19 economic stimulus package worth $7.5B total in spending over two years.^[11] Just before the writ was dropped, the Sask Party government put into force a SaskBuilds Board-approved government policy designed to prioritize Saskatchewan-based vendors—consistent with the original intent of Priority Saskatchewan.

The awarding of many tenders to out-of-province firms has been a point of contention among the province’s business community in recent years. In an attempt to court frustrated voters operating in the procurement space, the NDP platform contained a “Saskatchewan First” procurement policy whereby Saskatchewan-based firms and workers would be given priority for Crown and government-led projects.^[12] The Progressive Conservative Party platform also contained similar overtures regarding a preference for sourcing locally.^[13] In the case of government procurement policy, the Sask Party, NDP, and the Progressive Conservative Party platforms did not differ substantially in this regard. 

Conclusion

The need to address voters’ pressing concerns over COVID-19 served to temper the more grandiose policy ambitions (and therefore spending promises) of established parties for this election. The ideological gulf that has gradually narrowed over time between parties, particularly the Sask Party and the NDP, is indicative of a larger trend that began in the 1990s and continued into the 2000s.^[14] Whether the next provincial election, scheduled for 2024, will see a continuation of ideological convergence toward the centre or a stark departure from it is anybody’s guess.

References

[1] Arthur White-Crummey. “Health, Economy and Resources are Top Issues for Saskatchewan Voters.” Regina Leader Post. October 15, 2020, https://leaderpost.com/news/politics/sask-election/health-economy-and-resources-are-top-issues-for-sask-voters

[2] Saskatchewan Party. Our Plan for a Strong Saskatchewan, (Regina, SK: Saskatchewan Party, 2020). 5.

[3] Government of Saskatchewan, Ministry of Trade and Export Development. Saskatchewan Small Business Profile 2019 (Regina, SK: Ministry of Trade and Export Development, 2020).   

[4] Saskatchewan New Democratic Party, People First Platform 2020, (Regina, SK: Saskatchewan New Democratic Party, 2020).  

[5] Saskatchewan Liberals. Our Ideas, (Regina, SK: Saskatchewan Liberal Party, 2020).

[6] Note: The Government of Saskatchewan already offers a suite of tax credits to the manufacturing and processing (M&P) sector.

[7] Progressive Conservative Party of Saskatchewan, Making Saskatchewan Our Priority: Economy – Taxes (Regina, SK: Progressive Conservative Party of Saskatchewan, 2020).   

[8] Saskatchewan Party. Our Plan for a Strong Saskatchewan, 10.

[9] Saskatchewan New Democratic Party, People First Platform 2020, 8.

[10] Saskatchewan Liberals. 2020, “Our Ideas: Leadership in Education and Health Care.”

[11] Government of Saskatchewan. “Building a Strong Saskatchewan: $7.5 Billion Invested in Infrastructure Over Two Years to Stimulate Provincial Economic Recovery.” (Media Release, May 6, 2020).  

[12] Saskatchewan New Democratic Party, People First Platform 2020, 10.

[13] Progressive Conservative Party of Saskatchewan, Making Saskatchewan Our Priority: Priority for Saskatchewan People and Businesses.  

[14] David McGrane, New Directions in Saskatchewan Public Policy. (Regina: Canadian Plains Research Centre Press - University of Regina, 2011).

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