The Pallister government shifts into high gear

Explaining the transition from "regressive" incrementalism to more sweeping social, economic and energy policy reforms
July 1, 2019

Manitoba Premier Brian PallisterPhoto from the U.S. Department of Agriculture

Over 15 years in government (1999 to 2016), the Manitoba NDP made incremental changes to social and economic policy that moved the province in a more progressive direction. Many progressives say these changes did not go nearly far enough. In some areas, however, as a result of persistent pressure from civil society, the government engaged in “radical incrementalism,” described by American political scientist Sanford Schram as the undertaking of steady, incremental policy changes that lay a foundation for transformative change.

We propose that the current Progressive Conservative government led by Premier Brian Pallister initially engaged in a mirror-image version of this policy we call “regressive incrementalism.” The strategy—to gradually unravel promising changes made during the previous NDP government—is similar to that adopted by the conservative Filmon government of the 1990s. But Pallister has since proposed more sweeping reforms with the intention of permanently weakening labour and compromising future governments’ ability to use public services and Crown corporations to foster more equitable and sustainable economic development in the province.

“Radical incrementalism” and progressive change

Among the progressive policies put in place by the last NDP government to help equity-seeking groups were regular, above-inflation increases to minimum wage, investment in child care, a significant expansion of social housing, and Rent Assist, a program to help low income people access private-sector housing. While these incremental changes did not transform existing power structures, they did moderately shift the balance.

The NDP government strengthened public institutions such as Manitoba Hydro, which was mandated to act in creative ways to support social enterprises (and the training and employment of multi-barriered workers) while investing in alternative energy generation such as geothermal. In an example of larger-scale commitments, the government invested heavily in new hydro development with the goal of increasing exports and improving energy security. It used Manitoba Hydro as a way to implement project-based labour agreements that benefitted unionized and non-unionized workers. The utility also entered into agreements with First Nations for shared ownership of new hydro developments, and training and employment opportunities for First Nation workers.

The NDP government also supported Manitoba’s labour community with friendlier legislation. It invested in post-secondary access programs initially introduced (by another NDP government) in the 1980s to help multi-barriered students succeed in their university studies. The government significantly boosted support for inner-city revitalization through a popular Neighbourhoods Alive! initiative. In response to concerns raised by non-profit organizations working on the frontline with Manitoba’s most vulnerable, the NDP government signed multi-year funding agreements with more than 100 community-based organizations, making Manitoba the envy of similar groups across Canada.

In 2009, the Manitoba government released an important poverty reduction strategy, which it enshrined in law in 2011. Among its priorities, the Poverty Reduction Strategy Act required the government in each fiscal year to “take the poverty reduction and social inclusion strategy into account when preparing the budget for that fiscal year,” and to “prepare a statement that (i) summarizes a strategy and sets out the budget measures that are designed to implement the strategy, and (ii) sets out the poverty reduction and social inclusion indicators prescribed by regulation that will be used to measure the progress of the strategy.”

Regressive incrementalism, then and now

In 2016, Brian Pallister’s Progressive Conservatives unseated the NDP and began reversing the course of provincial policy in a process we call “regressive incrementalism.” The same process unfolded in the 1990s when the PC government of Gary Filmon dismantled programs and policies implemented by the NDP government that preceded it.

For example, the Filmon government gutted programs to help students access post-secondary education, starved public housing, implemented workfare policies and withdrew funding from 56 community-based organizations, leaving a gap in service for many vulnerable Manitobans. As result, many low-income individuals and communities went through difficult times in the 1990s. It has taken nearly two decades for new capacity to be built and for communities to begin to rebuild.

The Filmon government made other, irreversible changes such as the privatization of Manitoba Telephone System (MTS), now owned by Bell. In 1996, the government also attempted to privatize homecare services. That experiment failed for a number of reasons and homecare services were brought back into the public sector a year later. The subsequent NDP government was able to reverse course in many areas during its 15 years at the helm, but many of those gains are now being rolled back once again.

The Pallister government’s regressive strategy was immediately applied to the civil service and Crown corporations. First the government eliminated the card check system for union certification, forcing workers who want to organize into secret elections. Then the government introduced legislation to freeze public sector wages for two years, mandating a 0.75% wage increase for the third year and a 1% increase in year four. This legislation has been contested by the Manitoba Federation of Labour on the grounds that it violates a union’s right to collectively bargain on behalf of its members. The province has also forced health care unions to reduce the number of bargaining units, putting them in a long, disruptive process of jockeying for members. 

As for the Crown corporations, in 2017, Manitoba Hydro, Manitoba Public Insurance and Manitoba Liquor and Lotteries Corporation were all ordered to trim personnel and reduce management by 15%. Manitoba Hydro eliminated 900 jobs and cut management staff by 30%. The main reason given for the cuts was that the province had to reduce its deficit, which was not nearly as serious as the government claimed. At the same time, the Pallister government is proceeding with its campaign promise to cut the PST by 1%. This will reduce provincial revenue by $325 million over the next fiscal year.

The looming loss in PST revenue coupled with the government’s fixation on the deficit has meant a steady stream of cuts since 2017. The province has held back funds for much needed infrastructure repairs, stopped investing in the expansion of social housing, cut funding to universities and school divisions, is decreasing social assistance benefits, and is scaling back Rent Assist. But the attack on the public sector is still escalating. The province has eliminated inexpensive but very effective programs such as Neighbourhoods Alive!, the previous government's flagship community revitalization initiative, and community-based organizations are worried their multi-year funding agreements with the government are not being renewed.

This April, Crown corporations received a letter from Minister Colleen Mayer reminding them that they “must align with our government’s mandate to fix our finances, repair our services and rebuild our economy,” and that “the old way of doing things, where government just got bigger and more expensive is over” (sic). The quickest way to shrink government and make it less expensive is to get rid of workers. The ministerial letter to Efficiency Manitoba, the new Crown corporation responsible for energy efficiency and conservation, was clear on this point: programming must improve, “but at a significantly smaller percentage of the costs and materially less labour costs” (sic).

Each Crown corporation is now expected to follow the province’s example of shrinking the civil service and reduce their workforce. This will result in a further 15% reduction in management positions and an 8% cut in regular staff. A May 2 Winnipeg Free Press story reports that Manitoba Hydro is hesitant to comply. The corporation’s Bruce Owens states, “We believe that further staff reductions would significantly increase the risk of public and employee safety, of system reliability, and as well our ability to provide reasonable levels of service to our customers.”

From incrementalism to sweeping change

The mandate letters, combined with previous changes to health care and the soon-to-be launched educational reforms led by a finance minister from the Filmon years, would indicate that the Pallister government is shifting gears, from incremental to sweeping change. Some of these regressive changes will be near impossible to reverse.

Early on in its tenure, the Pallister government made incremental changes to the health care sector, including consolidation, privatization and service cuts. But the pace intensified in April 2017 with the closure of three emergency departments and the announcement that two more would become urgent care units. The reorganization is meant to reduce wait times, but some doctors point out that the real issue is the lack of hospital beds—a problem that would require money, not reorganization, to fix.

Nova Scotia doctor-turned-consultant David Peachy designed the plan for these changes. As reported in the Winnipeg Sun, Peachy was summoned back to Winnipeg in May 2019 to explain why two of the three ER closures are now on hold. The massive shift of staff and level of service is being blamed for the increase in wait times at emergency rooms and unprecedented increases in mandatory overtime for nurses. When pressed by the media to explain why his consolidation plan was having the opposite effect it was supposed to, Peachy’s response was bizarrely incomprehensible and misleading. He claimed that the nurses were pleased with the changes when in fact they are on the frontline pushing back.

A Manitoba Nurses Union press release explained their actual assessment of the meeting they had with Peachy and comments he made at the media conference: “To characterize the response from nurses as anything short of severe disappointment with the consolidation plan is completely misleading. These changes have caused massive problems in our health care system, from overcrowding in ERs, to a loss of experienced nurses in highly specialized units, and severe workload issues.”

We saw it coming

Since Pallister’s election, progressives have been worried about the comeback of 1990s-era changes to health care and education. These concerns are now festering in the health care sector and will likely escalate once the promised education reforms get underway. We have also been wondering if and when the privatization of Manitoba’s Crown corporations would raise its ugly head.

The mandate letters to all provincial Crowns offer some proof that there is more afoot than incremental change. Of particular concern is the direct order to Manitoba Liquor and Lotteries to look for ways to engage the private sector more in the sale of alcohol. And in November 2018, the government hired B.C.’s ex-premier Gordon Campbell to head an inquiry into the previous NDP government's capital investments in Manitoba Hydro’s generation and transmission capacity. The Pallister government has been highly critical of these projects and it is anticipated the inquiry’s final report will further admonish its predecessor, the investments and the utility.

Pallister’s strategy is similar in many ways to that of his conservative forebear. Despite promises to never privatize MTS, Filmon’s PC government followed what has become a tried and true blueprint for privatizing Crowns in Canada, one that Campbell is very familiar with. It looks like this:

  • Tell the public there is a major problem with the Crown corporation.
  • Hire private sector consultants to confirm and cement the narrative that the problem is one of too much government interference.
  • Separate divisions of the Crown, ostensibly to make it run more efficiently.
  • Begin to sell off the divisions to the private sector.

Campbell has since been removed from the inquiry. If whoever takes over is able to exploit the Progressive Conservatives’ constant barrage of criticism about Manitoba Hydro, any number of privatization schemes could unfold. The separation of its demand-side management program into the independent Efficiency Manitoba Crown corporation suggests we could be about to enter the final stage of a privatization strategy.

The overhauling of the health care system, cuts to social services, legislative changes affecting workers, anticipated changes for education and increasingly bold moves around Crown corporations show that Pallister’s government has shifted from incremental to substantive change. Their sudden cancellation of the Manitoba carbon tax would indicate that they are emboldened by the blue wave saturating provinces from Ontario to Alberta, a wave that also threatens to destroy the moderate progress made in those provinces and push all of Canada into rewind.

More questions than answers

As we analyze the changes taking place in Manitoba, a few lines of questioning arise. First of all, to what degree did the NDP in government make a conscious decision not to take the kinds of bold steps required to ensure transformational progressive change in the province? While it is common for governments to move to the centre when elected, could the NDP have pushed the envelope a bit further while maintaining office? In other words, were they more cautious than necessary?

A thorough treatment of that question cannot be addressed here, but it is fair to say that there was not any sort of consensus across the government. While some cabinet ministers and advisors were more cautious, others were able to gently push certain departments in more progressive directions. But the transformation from incremental to structural change never occurred.

Aligned with this is the observation that conservative governments seem far more willing and able to implement sweeping changes when in office than more left-leaning governments. Why is that? It could be that the conservative base, with its much deeper pockets, is more willing to jump on the political bandwagon and support big ideas when they arrive.

The Progressive Conservative party in Manitoba is itself better resourced and equipped to see unpopular changes through. In power, it has proven more willing to take the plunge on risky policies—cutting back on education and health care, for example—than the NDP has been to bring in more aggressive anti-poverty measures or more effective environmental protections. As we in Manitoba know, if you increase the PST by 1% there will be a public outcry. But if you decommission Neighbourhoods Alive!, or cut welfare benefits, you’re probably in the clear.

Which raises a final question: Did progressive community organizations and labour unions miss an important opportunity when they had greater stability under an NDP government? Could they have done a better job educating and politicizing their constituents, and to prepare them to push back when the cuts came? We now need to reckon with the fact that we have not managed to politicize those who work on the frontlines.

Effective resistance to an increasingly sharp right turn has been slow to materialize. A new labour-community health coalition is gaining traction, but building momentum takes time. Unions are also focussed on particular issues such as nursing shortages and overtime, and a Manitoba Federation of Labour initiative to take the province to court over its civil service wage-freeze legislation. These campaigns are necessary and welcome, but we’ll need to do much more.

The blue wave in Canada is going to make it much harder to make progress on the climate crisis and inequality (in its many forms, and especially between Indigenous and settler communities)—the two most pressing problems our country faces. The Kenny and Ford governments’ conservative radicalism is emboldening Manitoba’s Pallister government to play a similarly backward spoiler role on both fronts. Will Manitobans find the energy to fight back?

Labour needs to join with a variety of strong advocacy groups like Make Poverty History Manitoba, Manitoba Childcare Coalition, The Right to Housing Coalition and environmental groups if we are to build the sort of broad-based movement needed now that regressive incrementalism is evolving into radical conservative change. It’s the only way we can respond to the cumulative damage being done to all Manitobans, especially to the most marginalized.

Lynne Fernandez holds the Errol Black Chair in Labour Issues at the CCPA-Manitoba. Shauna MacKinnon is Associate Professor at the University of Winnipeg’s Urban and Inner City Program.