Nova Scotia Labour Advocate Questions PC Paycheck Program
HALIFAX — Labour advocates in Nova Scotia are questioning a new program proposed by Progressive Conservative leader Tim Houston.
Yesterday, Houston announced his party’s “Better Paycheck Guarantee,” which would give businesses the option to divert some of their corporate taxes to employee wages or hiring, rather than paying it to the government.
The plan would allow businesses to divert 50 percent of their Nova Scotia taxes away from government coffers and toward hiring new staff, wage increases, or bonuses for workers.
The top 20 percent of earners in every company would not be eligible for the subsidy. Employers would have the discretion to distribute the money how they please but must use it for employees in Nova Scotia.
On July 13, Houston told Huddle the program would mean more money for working families in Nova Scotia.
“Basically, we want to raise the wages of the working families of the province. We know that will have a long-term positive impact on the province. It will transform our economy because they’re going to spend it,” he said.
Danny Cavanaugh is the president of the Nova Scotia Federation of Labour. July 13 he expressed frustration that the PCs released their plan without more consultation with labour organizations.
“If Tim Houston and his party really want to say they represent workers, and they’re going to represent workers, then they’re going to need to involve workers when they build these policies,” Cavanaugh said.
Cavanaugh argued there is a better, more direct way to put more money in workers’ pockets than Houston’s plan: raise the minimum wage.
He said the PCs acknowledge putting more money into worker’s pockets will create more spending and benefit the economy “so why doesn’t Tim Houston come out and say he prefers to have a higher minimum wage in Nova Scotia?”
A higher minimum wage, Cavanaugh argued, would accomplish much of what the PCs say they want to with their plan while also ensuring all of the province’s lowest-wage workers benefit.
He argued there’s no guarantee that under the PCs plan every company will take advantage of the program, meaning some workers will be left behind.
Houston said his plan will help more than just those making minimum wage.
“I’m a fan of higher wages. I’m looking for a way that actually makes that happen for all working families,” he said.
He said he feels for minimum wage earners that are “struggling” but that other workers outside of those making minimum wage are also struggling. His plan, he said, will help them as well.
“Raising the minimum wage will have an impact on the number of employees a company has. It’s going to put their costs up. And that has an impact on how many people they can have working on a certain shift. That’s just the realities of life and business,” Houston said.
A minimum wage increase also doesn’t require the provincial government to give up any revenue. Critics of Houston’s plan argue it’s more of a corporate tax cut than a program meant to benefit workers—especially since a company can use its rebate to hire new employees, rather than increase current employees’ wages.
According to provincial budget documents, Nova Scotia expects to take in a little more than $500-million in corporate income tax this fiscal year. Using that as a baseline, the PC’s plan could cost the province as much as $250-million a year.
That $250-million would be a fraction of the nearly $12-billion in revenue the province expects to take in.
Houston suggested criticisms that his plan is just a tax cut in disguise are largely political posturing.
“I live in a world where branding is important. My political opponents try to brand me a certain way [but] I think they were really taken off guard by how innovative this plan is,” he said.
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