Canadians in every province will pay more than $1,300 per person in 2022/23 on government interest costs, according to a new study released Thursday by the Fraser Institute, an independent, Canadian public policy think-tank.
“Interest must be paid on government debt, and the more money governments spend on interest payments the less money is available for the programs and services that matter to Canadians,” said Jake Fuss, associate director of fiscal studies at the Fraser Institute and author of Federal and Provincial Debt Interest Costs for Canadians, 2023 edition.
Mikhail Nilov
The study said that taxpayers across Canada will pay a total of $68.6 billion on interest payments for the federal and provincial debts in 2022.
The federal government will spend $34.7 billion on debt servicing charges in 2022/23, which is more than the government expects to spend on childcare benefits ($29.4 billion) and employment insurance benefits ($24.8 billion), it said.
“Even before the COVID-19 pandemic and recession, governments across Canada and in Ottawa were racking up large debts, and this debt imposes real costs on Canadian taxpayers in the form of interest payments,” said Fuss.
“Interest payments across the country are substantial, and that takes money away from other important priorities.”
Nationally, Newfoundland and Labrador’s combined federal and provincial interest costs is the highest in the country at $2,727 per person. Quebec, Canada’s second most populous province, is the next highest at $2,110 per person, said the report
Meanwhile, total expenditures on interest costs for Albertans ($6.7 billion) is more than what the province will spend on physicians this year, and combined federal-provincial interest costs for British Columbians ($7.4 billion) are nearly equivalent to what the province expects to spend on its social services this year, said the Fraser Institute.
(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 worked for 35 years at the Calgary Herald, covering sports, crime, politics, health, faith, city and breaking news, and business. He works as well as a freelance writer for several national publications and as a consultant in communications and media relations/training. Mario 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)
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