Politics, Business & Culture in the Americas

Stephen Harper’s Financial Troubles

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It’s been a long eleven months for Canadian Prime Minister Stephen Harper and his fellow Conservatives. After a strong start in May 2011 following the election of his first-ever majority government, Harper has faced months of relentless attacks in the House of Commons—and the strain is showing.

Now the public is witnessing another Stephen Harper. Always in control, he now has a hard time getting his message through. Day after day during the daily Question Period in the House of Commons, the prime minister has had to defend unpopular positions about costly fighter jets, a rollback on pension eligibility (from 65 to 67 years old starting in 2023), and the suspected involvement of the Conservative Party in an alleged scheme to mislead voters on election day last May.

Not to mention that Harper is facing a court challenge from the provincial government of Québec over the dismantling of the federal long-gun registry and all the data it contains. Québec is contesting the federal decision because it wants the data collected on the identity of Québec rifle owners to set up its own provincial registry.

But the Tories’ main problem is the growing controversy over the cost of 65 F-35 stealth fighter jets it plans to buy from the U.S. firm Lockheed Martin as part of an international consortium. Other nations have scaled back their military orders as the ballooning costs became apparent. But the Harper government remained tight-lipped about its plans for months.

That all changed on April 3. A new report from Michael Ferguson, Canada’s Auditor General who acts as an independent controller with authority to comb through the expenses of federal departments and agencies, lists the cost of these fighter jets at a minimum of $25 billion rather than the roughly $15 billion that was previously anticipated. After initially saying that defense officials withheld information from ministers, Ferguson said it was likely the Harper government must have known about the true cost of the program. He faulted the government for mismanaging the F-35 program and not telling Canadians about the true cost of the country’s largest-ever military purchase.

Ministers have been tripping over themselves trying to explain the massive $10 billion gap ever since. For one, Defense Minister Peter MacKay cited “differences in accounting,” noting that the publicly-quoted figures did not take into account the actual operating costs for the jets.

The Harper government has tried to soften the blow by freezing all further spending on the project, setting up a new procurement system and by promising yearly updates to Parliament.  After letting on for months that a deal was a fait accompli, the government acknowledged that no contract had actually been signed with Lockheed Martin for the purchase of these fighter jets. There is, however, a memorandum of agreement in place.

There has been collateral damage from this gaffe. For the first time, the Conservatives are even in the polls with the New Democratic Party under the leadership of Thomas Mulcair, who became leader of the opposition in late March 2012. A Harris-Decima poll this month put the Conservatives at 34 percent and the New Democrats at 32 percent.

The image of the Conservative Party—which was elected in 2006 on a promise to bring in a new era of accountability and transparency to Ottawa—has taken a hit, says Ottawa pollster Nik Nanos from Nanos Research.

Although Harper might not necessarily be “the most lovable prime minister or the most popular individual, he is recognized by a number of Canadians as being competent, and his government as being a very competent government,” Nanos says. If the Conservatives act swiftly, he adds,  they can get through this latest gaffe. The present political damage is because “there hasn’t been an explanation as to why this happened.”

The opposition parties are trying very hard to keep this issue alive; Mulcair and the New Democrats want to establish themselves as a credible government-in-waiting and paint the Conservatives as a reckless government untrustworthy with taxpayers’ dollars.

It’s difficult to tell whether this “F-35 fiasco”—as the Liberals put it—will have a longstanding effect on the Conservative base.

But in the meantime, it is “hurting people’s morale,” acknowledges a Conservative supporter, Tim Powers from Summa Strategies.

“The opposition is making the public think that planes have been purchased,” he laments, even though that is not the case.

In the past, Harper’s Conservatives have shown they have a Teflon coating—that is to say, that any controversy rolls off them. The question is: this time, will it hold?

Huguette Young is an AQ Online contributing blogger based in Ottawa, Canada.


Huguette Young is a veteran journalist and blogger in Ottawa, Canada.

Tags: Canada, Stephen Harper, Thomas Mulcair
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