Municipalities should watch spending: report

  • Dec. 7, 2009 8:00 p.m.

Municipalities in BC, including those on the islands, are failing to keep their spending in line with population and inflation growth, according to a report released last month by the Canadian Federation of Independent Business. The report, titled “Municipal Spending Watch”, tracks operating expenditures in BC municipalities between 2000 and 2007, and concludes that spending growth is rising at an unsustainable rate. “Only 2.4 per cent of British Columbians now live in a municipality that has kept growth in operating spending between 2000 and 2007 lower than population and inflation growth,” the report says. “Over the past seven years, only 24 small municipalities have been able to restrain spending on operations. The other 129 municipalities have not.” Information about two of the islands municipalities is included in the appendix, with the report noting that it’s difficult to make conclusions about trends in spending in small towns – those with populations under 7,500 – as there can be large fluctuations in spending from year to year. According to the CFIB, Masset had a “fiscal sustainability gap” of 5.58 in 2007. The gap is calculated by dividing the village’s percentage increase in spending since 2000 (in Masset’s case, almost 52 percent) by its population and inflation growth since 2000 (for Masset, the CFIB put this figure at 9.3 per cent). Port Clements ended up with a fiscal sustainability gap of 3.15 (the smaller the number, the better). Port experienced population and inflation growth of 3.9 per cent between 2000 and 2007, according to the report, but its spending grew by 12.3 per cent during the same period. Masset, with a population of 975, is listed as spending some of the most per capita of the small municipalities in BC. Per capita spending was $3,043 in 2007, putting Masset in fourth place of municipalities under 7,500, behind McBride, Tahsis and Taylor. Port Clements, with a population of 472, was in 49th spot, well below the average, spending $1,134 per capita in 2007. Queen Charlotte was not listed in the report, and several northern municipalities were left out because their population growth had been negative during recent years.