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Cablegate: Nova Scotia: Throne Speech Promises Legislated Auto

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS HALIFAX 000305

SIPDIS

SENSITIVE

E.O. 12958: N/A
TAGS: EFIN PGOV CA
SUBJECT: NOVA SCOTIA: THRONE SPEECH PROMISES LEGISLATED AUTO
INSURANCE PREMIUMS

SENSITIVE BUT UNCLASSIFIED -- PLEASE PROTECT ACCORDINGLY.

1. (U) Nova Scotia's House of Assembly session opened
September 25. The Speech from the Throne which laid out the
government's agenda began on a conciliatory note; Premier Hamm's
Conservative party is two seats shy of a majority and will need
cooperation from the Liberals and NDP to govern. "We all want
minority government to work," Lieutenant-Governor Myra Freeman
said. The speech noted that the province faces a number of
challenges -- improving health care and increasing economic
competitiveness were at the top of the list -- and promised
appropriate investments and tax cuts as the way to address them.

2. (U) Along with a pretty standard call for Ottawa to provide
the province with more money for health care, the Throne Speech
announced that the government planned to introduce legislation
lowering automobile insurance rates 20 percent. A precise
mechanism for doing this was not spelled out, but the speech
(and previous leaks to the press) indicated that the government
is looking at a combination of price and claim controls to
achieve the 20 percent reduction. The speech also announced
plans to cap property tax assessment increases and to provide
relief to voluntary organizations from "frivolous and
unwarranted legal claims."

3. (SBU) COMMENT: Conventional wisdom is that this minority
government will last about a year. In the near term no one
wants to force another election, and Premier Hamm is in a
reasonably strong position with 25 out of 52 seats. But the
opposition parties will inevitably begin to chafe if the Premier
is able to claim credit for, and improve his party's support
with, populist measures like insurance rate reductions and
property tax caps. On the other hand, there's no guarantee that
either measure will be particularly effective or
well-implemented, and the Liberals and NDP may be able to
improve their own standing simply by biding their time. END
COMMENT.


HILL

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