Budget Bulletin: Cost-Recovery Measures

All taxpayers help to pay for the hundreds of programs and services offered by government. However, not all Nova Scotians use all of these programs, and some Nova Scotians use these services more than others.

The philosophy behind cost-recovery measures for social programs is that the people who most directly benefit from a service should contribute more to the cost of providing the service than those who do not use it. For some programs, such as Pharmacare, increased usage and costs mean that higher fees for those who benefit from the program are essential to sustain it. The same principle applies for regulatory program cost recoveries, such as the fee for licensing insurance agents, where the direct beneficiaries of the service help pay for its cost.

Government is attempting to strike a balance between the need for users to contribute more to the cost of a service and the importance of the service to individuals. For example, the increased tolls on provincial ferries will affect only cash-paying customers. Local and frequent users will have the option of purchasing books of tickets. Those rates will not rise.

In other areas, Nova Scotia is catching up to what other provinces already do. Nova Scotia is the only province in Canada that does not recover from the Workers' Compensation Board the cost of legal services provided to workers appealing decisions of the WCB. Also, Nova Scotia is the only province to pay one-third the costs of arbitration conducted under the Trade Union Act and the Corrections Act. Both of these items will now be subject to cost recovery.

Summary of changes ($ thousands generated)

Commissions and payments eliminated:
Gas and diesel tax wholesalers 435 Tobacco tax wholesalers 100 Industry and community groups 200 for water management

735

Fees increased:
Ambulance users 5,000 Pharmacare co-pay 4,400 Home support services 2,200 Driver testing, handbooks, and abstracts 950 Social assistance prescription drugs 700 Ferries 300 Insurance agents, companies' licences 200 Environmental approvals 200

13,950

Fees for justice, labour, and public safety:
Workers' Advisory Program cost recovery 1,800 Summary offence tickets 1,500 Sheriffs and probate fees 975 911 service cost recovery 745 Defaulting on maintenance enforcement 200 Licensing stationary engineers 200 Propane fuel and electrical permits 166 Child abuse registry 77 Eliminate 1/3 cost-sharing of arbitrations 75

5,738

Total new and increased cost-recovery measures 20,423

NOTE: For other 2000-01 budget information, visit the Department of Finance website at www.gov.ns.ca/finance .