03/26/2012 04:09 EDT | Updated 05/26/2012 05:12 EDT

New Brunswick Budget 2012: 4,500 Government Jobs To Be Cut: Source

CP File
FREDERICTON - The New Brunswick government plans to cut 4,500 jobs from the province's civil service over the next three years to tackle its deficit, a government source told The Canadian Press on Monday.

The source said Tuesday's provincial budget will outline the elimination of 1,500 jobs a year through attrition, which would reduce the size of the public service by five per cent at the end of the cuts.

The province's Progressive Conservative government has been searching for ways to streamline the delivery of government services since it was elected 18 months ago in an effort to cut spending and fulfil a campaign pledge to balance the budget by the end of its mandate in 2014.

Danny Legere, president of CUPE New Brunswick, said he was "shocked and disappointed" that job cuts will be announced in the budget.

"Government talked about cutting the fat but certainly 1,500 jobs every year for three years is far beyond that," he said.

"We're getting right down where the services are definitely going to be cut and going to have a significant impact on the daily lives of New Brunswickers."

In an interview earlier Monday, Premier David Alward said many people in the civil service are nearing retirement age, which allows the government to trim positions that aren't considered essential.

"We're committed to bringing New Brunswick's fiscal house in order and living within our means," he added.

The province faces a projected $471 million deficit for the 2011-12 fiscal year and its debt is expected to top $10 billion.

The source said the government also plans to put an airplane it owns up for sale. The plane has become a political lightning rod after the Opposition accused government members of using it inappropriately last year, something Alward has denied.

Liberal finance critic Donald Arseneault said he doesn't see how Alward can cut the jobs without reducing services.

"He needs to be up front with New Brunswickers and say which civil servants are not going to be replaced or which civil servants are going to be fired," Arseneault said. "This is definitely going to have an impact on the service and the programs that the government offers to New Brunswickers."

Arseneault said the government should focus on job creation and boosting economic growth to combat the deficit.

Legere said Alward and Finance Minister Blaine Higgs haven't listened to the union's push for the government to increase revenues, which would include collecting more in income tax, particularly from thewealthy.

"A progressive tax system would have more of a smooth effect where everybody pays their fair share along the lines of their ability to pay," he said.

David Murrell, an economics professor at the University of New Brunswick in Fredericton, said he believes the government should also increase the harmonized sales tax — at least temporarily.

"I would raise it by one percentage point until the deficit is eliminated," Murrell said.

Alward said he has no intention of raising the HST or gas tax. He also dismissed suggestions the government could introduce highway tolls.

Gas taxes increased by 2.9 cents a litre in Higgs's last budget. And in recent months, the government has increased user fees on public services ranging from camp site rentals to motor vehicle registrations. Those increases are expected to generate about $6 million a year.

Earlier this month, the government merged a number of departments and created a new Government Services Department to consolidate some internal government services — a move Alward said would result in savings of about $100 million over three years.