Wednesday, September 24, 2008

2008 Bloc Quebecois budget externalities

Chapter 6 of Plateforme08 is my source for these figures. I don't speak French so I may have made obviously mistakes or missed entire programmes. The English 2008 budget summary on the Bloc website also mentions restoring ecoAUTO rebates. The budgets for Apr/09-Mar/12 I'm shifting back 5 months to encompass a 3 year minority government (could happen with Que. sweep and even split elsewhere).

The Bloc project an existing BofC budget surplus of $20.1B over next 3 years. This differs from BofC's $9.1B. The Bloc include a chart detailing their correct historic surplus predictions over the past decade. I don't know the details of the prediction methodology, if these are made at the same time as are the BofC's. I've only translated a few pages of their platform into English...so I'm sticking with the BofC's guess and if it is wrong all parties would get the surplus boost anyway. The Bloc includes $9B contingency fund. that leaves their 3 yr budget $2B in deficit. $2B/$(existing debt circa 2008)456.191B = 0.0043841%. This makes the new debt interest rate baseline 7.4023108%, and externalities must ROI 14.804621%, or be penalized where externality ROIs unestimated (most), by 0.87682%.

Bloc Quebecois plans to increase taxes on the oil industry to raise an additional $9.588B, included in this figure is $997M gained by eliminating accelerated capital depreciation for the oil industry. Renewable energy production, $315M. Boat fleet fuel efficiency upgrades, $560M. Buildings energy efficiency, $210M at 2x. Heating oil reductions, $515M. 50% excise tax reduction for inland flights (why not subsidize a more efficient fleet?), -$60M. $570M tax credit refund for transit at 2x, 1/2 listed under transit category for tallying. Restore ecoAUTO $460M.

Transit tax credit refund, $570M.

R+D tax credit: $1.32B. PARI (industrial research, I think) commercialization, $120M.

Affordable housing to end homelessness, $5B! Housing on Indian Reserves, $500M.

Foreign aid towards meeting 0.7% of GDP 2015 benchmark (I assume this is what this budget expenditure is for listed under "other ministries"), $1.4B.

$1.2B towards Indian Reserve funding. I've previously costed that about 14% of INAC's budget qualifies as an externality, would be listed as such under other categories. So for now I'll call this $168M IR externalities.

The Bloc have mentioned they are for marijuana decriminalization. So $1.2B.

IR externalities: $168M.
Foreign aid: $1.4B
Anti-homelessness: $5.5B
R+D: $1.44B
Transit: $570M
Environment: $12.368B
THC: $1.2B

So $22.646B divided by the debt penalty (2x % increase debt) of 0.87682% leaves a Bloc Quebecois 2008 budget with $22 449 161 000 in positive high ROI externalities. But there is a need to consider the currency depreciation (among many other) effects of Quebec separation; institutional investors would flee the CAD. I'll arbitrarily assign a 1/3 penalty to Canada's exchange rate and assume this arbitrarily devalues Canada's Bloc externaility budget, the same (for a lack of any better idea how to cost seperation).
So $21 854 376 000 without sovereignty, $14 966 105 000 with. To bad Bloc won't export some of their high ROI programmes like daycare to the rest of Canada