Some Canadian cities are over-spending municipal money: report

No matter where you live in B.C., you’ve probably heard the complaint from city hall — there’s not enough money to pay for all of the services, and that means either cutbacks or higher taxes.

But a new report from the Canadian Federation of Independent Business says if the country’s four biggest urban centers are any indication, cities are simply spending themselves into the poorhouse with municipal spending increasing at a much higher rate than population growth.

Those are the findings in the 12th annual report on municipal spending by the Canadian Federation of Independent Business, and each year the results are same – it’s happening in every city they are all guilty — city politicians and the bureaucrats including those at Vancouver city hall are spending well beyond the taxpayers’ ability to pay.

“If we continue going on this track, we headed to a crisis,” says Mike Klassen with the Canadian Federation of Independent Business. “You just have to look at what is happening in U.S cities and cities across the world. They have hit a wall financially and there are cities that are literally going bankrupt.”

In Vancouver, spending in that 12-year period has jumped 50 per cent. But the population, the new tax base has grown just 15 per cent.

But Vancouver city councilor Raymond Louie says the CFIB’s analysis is flawed.

“It is a bit of lazy sensationalism on their part to pull out these numbers, and use only those two measures,” says Louie.

The CFIB numbers come from municipal books and Stats Canada.

They found that when you compared municipal spending to population growth, Vancouver over the 12-year period is spending at a rate of 333 per cent more than the rate of population growth.

It’s even worse in Toronto, where its 500 per cent and Montreal, where spending compared to growth is 860 per cent more.

When it come to wages and benefits like gold plated pensions, the public is winning hands down, taking home a third more in wages and benefits.

Vancouver says it is trying to address spending, signing a worker contract for years with increases that are below inflation, but homelessness, mental health issues and other senior government downloads like the shutting down of the coast guard base are taking their toll.

“We have made some increases in expenditures, but what are we spending it on?” says Louie. “We are spending it on child care, we are spending it on more police, fire services, clean water, ensuring that our sewer and garbage are taken away. And these are core services that we are trying to provide to our citizens.”

According to CFIB, if cities had contained their spending, the average family of four in Vancouver would have saved more than $8,000 in property taxes.