Editorial: Politicians need to do a better job of investing tax dollars

Government financial transparency is improving. That’s encouraging. But government-spending decisions are not.

In its most recent report on the fiscal accountability of Canada’s senior governments, the C.D. Howe Institute strikes an optimistic tone about the improving state of that accountability based on government reports and financial statements for fiscal year 2017-18 and budgets and estimates for fiscal 2018-19. The non-profit research institute notes, for example, that consistency of accounting is now the rule among senior governments.

B.C. fares relatively well when compared with other provincial governments. The C.D. Howe study awards it an A- grade. That’s good enough for third place behind New Brunswick (A+) and Alberta (A) and far ahead of provincial laggards Manitoba (D+) and the Northwest Territories and Nunavut (F). The federal government, happily, scores a B+. 

But while C.D. Howe says Ottawa could join the top rank of fiscal accountability by instituting relatively minor improvements to budgeting procedures and presentation, transparency does not guarantee prudent spending of taxpayer dollars. And the country’s senior levels of government extract a lot of those dollars from the people they are elected to represent: more than $810 billion in 2018 alone, the C.D. Howe report estimates.

But many of those billions are too often wasted on ill-conceived and incompetently executed initiatives such as the federal government’s Phoenix payroll system disaster. Meanwhile, concerns over the fiscal wisdom of Ottawa’s Trans Mountain pipeline purchase continue to grow, especially considering that federal government transparency over the re-approved project’s financials has thus far been poor. And analyses continue to point to the weakness of Trans Mountain’s business case now and the erosion of that case in the future based on the relatively low-grade oilsands product that will be shipped to market via any Trans Mountain pipeline expansion and the hurdles the project still faces.

Financial transparency is good, but it does not necessarily improve the outcome of how money is spent.