The combined size of the federal, provincial, and municipal governments increased in all but two provinces over the 2007 to 2022 period (relative to the sizes of their economies), according to a new study released recently by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.
Alex Whalen
“The size of government increased in eight of ten provinces and the country as a whole over the last decade-and-a-half,” said Alex Whalen, associate director at the Fraser Institute and co-author of The Size of Government in Canada in 2022.
The study measures federal, provincial, and local government spending in each province as a share of the economy (GDP) from 2007 to 2022, the most recent year of comparable data.
The Fraser Institute said government size grew in every province except Prince Edward Island and Saskatchewan during that period. In 2022, the size of government relative to the economy as a whole across Canada ranged from a low of 26.8 per cent in Alberta to a high of 63 per cent in Nova Scotia, and was 40.5 of Canada’s total economy.
Previous research has shown that the size of government (as a share of the economy) to maximize economic growth and social progress is between 26 and 30 per cent of the economy (GDP). When governments exceed that size, it imposes negative effects on the economy, such as crowding out private sector investment, but without providing proportionate benefits such as greater social progress, added the organization.
Jake Fuss
“It’s important to understand just how much governments across Canada have grown in recent years, and what impact that might have on our economy moving forward,” said Jake Fuss, director of fiscal policy at the Fraser Institute and co-author.
Total Consolidated Government Spending as a Percentage of GDP
| Province | 2007 | 2022 | ||
| Newfoundland and Labrador | 38.7% | 44.1% | ||
| Prince Edward Island | 61.6% | 58.3% | ||
| Nova Scotia | 56.9% | 63.0% | ||
| New Brunswick | 52.7% | 57.6% | ||
| Quebec | 47.4% | 49.8% | ||
| Ontario | 35.8% | 40.1% | ||
| Manitoba | 45.0% | 49.4% | ||
| Saskatchewan | 37.7% | 32.8% | ||
| Alberta | 22.4% | 26.8% | ||
| British Columbia | 34.8% | 35.6% |
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 as one of the Top 10 Business Journalists in the World by PR News – the only Canadian to make the list. He was also named by RETHINK to its global list of Top Retail Experts 2024.
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