BUSINESS

Most Fiscally Irresponsible Provinces, According To C.D. Howe

03/21/2014 12:07 EDT
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Provincial governments in the Prairies are the worst chronic overspenders in Canada when it comes to delivering what they promise in their budgets, an advance glance of C.D. Howe’s latest “Pinocchio index” reveals.

Saskatchewan has been the worst offender in overspending on their budget plans over the past decade, followed closely by Alberta and Manitoba, according to the report to be released Monday that measures how well governments stayed in line with their budgeted forecasts.

Those provinces have relied on revenues from abundant natural resources, including oil, gas, potash and uranium to ramp up spending in the past decade, but commodities prices have taken a hit in the past few years, leaving governments with fewer royalties to pay the bills.

The federal government, meanwhile, has been one of the most fiscally accountable governments, overspending by just a fraction of what it outlined in annual budgets.

cd howe chart

Under the guidance of recently retired Finance Minister Jim Flaherty, the federal Conservatives have made balancing the budget by 2015 a priority.

In its most recent budget, Ottawa predicted a deficit of $2.9 billion for the fiscal year. But the government technically balanced the books when you take into account its $3 billion contingency fund.

Still, the federal government was handed the dubious Teddy Award for wasteful spending last month by the Canadian Taxpayers Federation for spending $2.5 million to promote a job grant that doesn’t yet exist.

Perhaps surprisingly, the Ontario government, which has taken an economic hit and is drowning in debt, has the third best record on hitting budget spending targets.

Newfoundland has been the only Canadian government to consistently spend less than what it outlined in its forecasts over the last ten years.

C.D. Howe will release the full report on Monday.

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