Fraser Institute News Release: Interest costs consume substantial portion of government revenue in Newfoundland & Labrador, Nova Scotia, New Brunswick and P.E.I.

For example, according to Interest Costs and their Growing Burden on Canadians , this year Newfoundland & Labrador will use 13.5 per cent of its revenue to pay interest on its provincial government debtby far the largest percentage in the country.

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GlobeNewswire, Inc.

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Wednesday, February 19, 2020

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Atlantic Canada, Provinces of Canada, British North America, The Maritimes, Provinces, Eastern Canada, Acadia, NOVA SCOTIA, NEWFOUNDLAND AND LABRADOR, PRINCE EDWARD ISLAND

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Vancouver, Bc

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FRASER INSTITUTE

Summary

Key Points:

For example, according to Interest Costs and their Growing Burden on Canadians , this year Newfoundland & Labrador will use 13.5 per cent of its revenue to pay interest on its provincial government debtby far the largest percentage in the country.
Nova Scotia (7.5 per cent), New Brunswick (6.6 per cent) and Prince Edward Island (5.7 per cent) will also spend substantial portions of their revenue this year on provincial government debt interest.
Per-person combined interest costs (again, both federal and provincial) in Nova Scotia ($1,370), New Brunswick ($1,317) and P.E.I.
This upcoming budget season, governments should remember that taxpayers ultimately pay the costs of government debt, said Alex Whalen.

HALIFAX, Nova Scotia, Feb. 19, 2020 (GLOBE NEWSWIRE) -- This year, all four Atlantic provinces will spend substantial portions of government revenue to pay interest on outstanding government debt, finds a new study released today by the Fraser Institute, an independent, non-partisan Canadian public policy think-tank.

“Like households, governments must pay interest on their debt, which means less money available for health care, education and social services,” said Alex Whalen, policy analyst at the Fraser Institute’s recently-launched Atlantic Canada division.

For example, according to Interest Costs and their Growing Burden on Canadians, this year Newfoundland & Labrador will use 13.5 per cent of its revenue to pay interest on its provincial government debt—by far the largest percentage in the country.

Nova Scotia (7.5 per cent), New Brunswick (6.6 per cent) and Prince Edward Island (5.7 per cent) will also spend substantial portions of their revenue this year on provincial government debt interest.

And of course, Atlantic Canadians must also shoulder their portion of the federal debt. People in Newfoundland & Labrador, for instance, will incur combined interest costs (from provincial debt and their share of the federal debt) totalling $3,343 per person, again the highest in the country. Per-person combined interest costs (again, both federal and provincial) in Nova Scotia ($1,370), New Brunswick ($1,317) and P.E.I. ($1,236) are lower.

“This upcoming budget season, governments should remember that taxpayers ultimately pay the costs of government debt,” said Alex Whalen.

MEDIA CONTACTS:
Alex Whalen, Policy Analyst, Fraser Institute
Jason Clemens, Executive Vice-President, Fraser Institute

To arrange media interviews or for more information, please contact:
Drue MacPherson, 902-429-1143, [email protected]

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The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of think-tanks in 87 countries. Its mission is to improve the quality of life for Canadians, their families and future generations by studying, measuring and broadly communicating the effects of government policies, entrepreneurship and choice on their well-being. To protect the Institute’s independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org.