The Numbers Game: Rating the Fiscal Accountability of Canada’s Senior Governments

Canada’s federal, provincial and territorial governments spent some $724 billion on programs and $58 billion on interest charges in 2017. They provide services ranging from defence through health and education to income supports. They have very wide taxing powers and legally unlimited authority to borrow. Canadians need to be able to monitor and influence the ways their elected representatives and government officials manage public funds. A key tool for Canadians as legislators, taxpayers and citizens to monitor and influence governments’ fiscal decisions is through their financial reports: • the budgets governments present around the beginning of the fiscal year; • the estimates legislatures vote to approve specific programs; and • the audited financial statements governments present in their public accounts after year-end. The quality and timeliness of these reports – and therefore their usefulness to legislators, taxpayers and citizens – varies widely. Our evaluation of the budgets, estimates and public accounts tabled by Canada’s senior governments in the 2017/18 fiscal year awards top marks to Alberta and New Brunswick. These A-plus provinces display the relevant numbers prominently and use appropriate and consistent accounting and aggregation in their budgets and public accounts. They also provide straightforward reconciliations of results with budget intentions, their auditors record no reservations, and their budgets and public accounts are timely. Less happily, other governments do not adhere to proper accounting standards, present budgets and estimates that are not comparable to their public accounts, bury key numbers, and are late with their budgets and/or their end-of-year results. Prince Edward Island’s D and the Northwest Territories’ D-plus put them at the bottom of the rankings. Notwithstanding some poor grades in this most recent evaluation, the financial reports of Canada’s federal, provincial and territorial governments generally improved over the years. Adherence to public sector accounting standards is better than it was, as is consistency in presentation of the key numbers. As Alberta and New Brunswick demonstrate, Canadians can get reliable, consistent and timely financial information from their governments – if they want it