A new report shows that Canadian cities including those in this province are overspending and households are footing the bill.
The report comes from the Canadian Federation of Independent Business (CFIB) and shows overspending has cost each household in Canada more than $7,800 in the past 12 years.
Fourteen cities were analyzed across the country, including St. John’s. The population in this province’s capital city grew by eight per cent from 2001 to 2011, while the city’s spending was calculated to have risen by 47 per cent after inflation-adjustment. CFIB also looked at the spending trends in Mount Pearl and Corner Brook, both of which they described as having increased operating spending excessively during the past 11 years, while experiencing declines in their populations.
“We already knew that our largest cities were living way beyond their means,” CFIB’s executive vice-president, Laura Jones said in a news release. “But it turns out even smaller cities are living large. And whether it’s today or tomorrow, we all pay the price through higher taxes.”
According to the release, some small business owners in Newfoundland and Labrador pay between two and five times more municipal tax than community residents. There are also increased fees for such things as permits, licences and some services.
“We recognize some municipalities are looking at ways to control their spending,” Vaughn Hammond, director of provincial affairs for Newfoundland and Labrador said in the release. “For example, the new city council in Corner Brook has identified municipal spending as a significant issue and, through its efforts, the city’s 2014 budget forecasts operational spending to decrease 1.5 per cent this year. This has to continue to ensure the city’s future sustainability.”
The release does say that the provincial government is currently consulting on a new fiscal framework.
“The discussion on the fiscal framework has largely been focused on the revenue that municipalities are able to generate,” said Hammond. “However, we show in this report that serious consideration has to be given to how they spend our tax dollars.”