OUR PREMIERS ARE SOL. They can no longer cry poor. The truth is provinces are rolling in dough, flush with enough surplus cash to fully fund all the programs for people we want.
Senior Economist David Macdonald lays it all out in Flush With Cash: The provinces are richer than they think, a new report from the CCPA (Canadian Centre for Policy Alternatives.)
Better than before the pandemic
It turns out all the doomsday predictions about how much the pandemic would hurt provincial economies were wrong. Macdonald crunched the numbers and discovered 10 out of 10 provinces already have, or will soon have, surpluses. Nine out of 10 of them are projecting that they will have better finances than before the pandemic started.
“While inflation has weighed heavily on Canadians, it has buoyed provincial finances,” says Macdonald. “The provinces now have the financial resources to properly index social assistance and other low-income transfers to inflation, fix broken long-term care systems and rebuild health care capacity.
No more excuses
“There are no more financial excuses to avoid action on these fronts, only political ones.”
Macdonald lays out the details of this good news story by looking at each province individually, pre-pandemic and now. Highlights of his research results include:
B.C.’s shift from a $322 million pre-pandemic deficit to a projected surplus of $1.3 billion for 2021-22
Alberta’s rebound from a deficit of $12.2 billion in 2019-20 to huge surpluses through 2025
Saskatchewan’s U-turn from pre-pandemic deficit to an over $1 billion surplus in 2022-23
Ontario’s rally from an $8.7 billion deficit in 2019-20 to a more than $2 billion surplus in 2021-22
New Brunswick’s projection, and recording, of a surplus each year of the pandemic.
From deficit to surplus
Overall, the provinces initially projected a combined deficit of $48.5 billion this year (2022-23), but that initial deficit projection has been transformed into a $7.1 billion surplus. The surplus would have been $44 billion in 2022-23, but the provinces have already spent $37 billion of it.
“This is a remarkable story of economic recovery from the depths of the COVID-19 lockdown impacts,” says Macdonald. “The next chapter will be written by the provinces as they decide what to do with their unexpected budget surpluses.”
Read Flush With Cash: The provinces are richer than they think HERE.
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