US embassy cable - 03HALIFAX305

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