The Canadian Federation of Independent Business has taken aim at municipal spending across Canada, just as municipal leaders have gathered in Vancouver for the annual convention of the Federation of Canadian Municipalities. The scrutiny is long overdue.
The CFIB notes that municipal spending has grown by 55 per cent in the last decade, even as the population has grown by 12 per cent.
Here’s some direct quotes from a CFIB press release:
“It is reasonable to assume that municipal spending would keep pace with increases in population and with increases in prices (inflation). Across Canada, population growth between 2000 and 2011 has been 12 per cent. In Vancouver, population growth was 15 per cent. Over that same time period, inflation-adjusted municipal operating spending increased by a jaw-dropping 55 per cent and 50 per cent respectively.
“In other words, the pace of municipal spending growth was over three times the growth in population and inflation.
“Put another way, municipalities have increased per-person spending by over 30 per cent. Do you feel like you are getting 30 per cent more services from your municipal government?
“Municipalities claim they are falling behind on one of their core responsibilities — infrastructure. At the same time, they say they need more revenue to deal with problems not addressed adequately by other levels of government, like housing and health.
“Transfers from senior levels of government to B.C. municipalities increased by 273 per cent between 2001 and 2010. So where is all this new municipal revenue going?
“Municipal employment increased by double the rate of population growth over the past 12 years. In addition, municipal employees make 36 per cent more in wages and benefits than equivalent jobs in the private sector. Wages and benefits make up 67 per cent of Vancouver’s budget. To unravel the overspending, this is where we must start.”
CFIB makes some excellent points. Municipal wages are considerably higher than those for similar workers in the private sector. Tough bargaining is needed to help rectify the imbalance. A close look at all benefits that go to municipal employees is also needed.
Municipal governments need to start exercising some restraint.