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November 22, 2024GOVERNMENT FINANCIAL STATISTICS, 2023 Statistics Canada has published the latest Consolidated Government Finance Statistics (CGFS) for 2023 including consolidated results for provincial-territorial plus local governments. Statistics Canada's data allows for comparability across jurisdictions, as well as consistency with the government consumption and investment data reported in macroeconomic accounts.
These data are based on the international government financial statistical standard and, as such, may differ in their presentation from similar concepts reported in Public Accounts and other government financial statements. CGFS data differ from reports published by governments due to differences in institutional coverage, accounting rules, timing and integration with the Canadian macroeconomic accounts.
The following analysis compares the per capita results for consolidated provincial-and-local governments. Local governments are consolidated into the analysis because each provincial government may assign different responsibilities to municipal or local governments.
Values for 2022 and 2023 may be influenced be extraordinary economic circumstances including elevated inflation and monetary tightening as well as rapid population growth and rising real estate values.
Revenues and Taxes
Total revenues per capita vary across the country, with Nova Scotia's provincial-local government revenues amounting to $19,352 per capita in 2023. This was above the Canadian average of $19,187 per capita. The highest per capita revenues were in Saskatchewan ($22,109) as well as in Québec ($21,204), where the government offers a different mix of public services, including delivering some services that are otherwise delivered by the Federal government (the value of the Quebec abatement to Federal taxes was $788 per capita and is included in revenue figures presented here). The lowest per capita revenues were in Ontario ($17,628).

Although Nova Scotia's provincial-local government revenues were 100.9% of the national per capita average, Nova Scotia's nominal GDP per capita was 77% of the national average (lowest among provinces). Thus, provincial-local government revenues amounted to a larger portion of Nova Scotia's comparatively smaller GDP per capita.

With Nova Scotia's lowest GDP per capita, Nova Scotia's provincial-local government consolidated revenues amount to 34.3% of provincial GDP - the highest share among provinces. Nationally, provincial-local consolidated revenues amounted to 26.2% of GDP. In contrast to Nova Scotia, Alberta's GDP per capita was the highest among provinces - 71% higher than that of Nova Scotia. So even though Alberta's per capita provincial-local consolidated revenues were higher, they only amounted to 20.9% of that province's GDP.

Per capita revenues increased by 2.7% in Nova Scotia from 2022 to 2023. This was the fastest increase in per capita revenues among provinces. Nationally, per capita revenues for consolidated provincial-local governments declined by 1.3% with decreases in six provinces. Newfoundland and Labrador reported the sharpest decline.

Taxes and transfers made up the largest portions of provincial-local consolidated government revenues in 2023.
Taxes are typically the largest source of consolidated provincial-local government revenues. Nationally, provincial-local consolidated tax revenues amounted to $11,413 per capita across Canada. Nova Scotia's tax revenues were $1,154 per capita lower than the national average at $10,259 per capita. The highest provincial-local tax revenues were in Québec at $13,020 (before the $788 per capita Quebec abatement of Federal taxes).
Beyond taxes and user fees, consolidated provincial-local governments generate revenues from workers compensation premiums, fiscal transfer payments, interest/dividend income, royalties and sales of goods/services. Those provinces that are Equalization recipients report higher fiscal transfer revenues per capita, particularly in the Maritimes and Manitoba.
Provinces with substantial oil and gas sectors (and to a lesser extent hydroelectricity and forestry) report stronger royalty income. Saskatchewan and Quebec also report substantially higher revenues from other sources, though this may include specific items that cannot be classified with others. In Statistics Canada's data, consolidated revenue from sales of goods and services includes tuition fees.

Per capita taxes for provincial-local governments decreased 2.6% from 2022 to 2023 across the country with all provinces reporting declines. Nova Scotia's taxes per capita decreased by 1.5%/ Newfoundland and Labrador (-18.4%) reported the steepest decline while Ontario (-0.1%) reported only a slight decrease.

Tax revenues break down into 8 major categories, including personal income taxes, corporate income taxes, general sales taxes, excise taxes/profits of fiscal monopolies, payroll taxes, property taxes, user fees and other taxes. The amount of revenues generated by these taxes reflects both the tax system itself (tax rates, deductions, credits, number of taxes levied) as well as overall economic conditions.
There are also differences in specific taxes across Canada. Alberta has no general sales tax. Alberta relies more on property taxes and user fees for revenues than most other provinces. Only Newfoundland and Labrador, Quebec, Ontario, Manitoba and British Columbia generate revenue from payroll taxes. Corporate income taxes per capita were higher in Saskatchewan and Alberta.

With rapid population growth, personal income taxes per capita declined by 1.4% in Nova Scotia in 2023. Nationally, personal income taxes per capita were up 2.1% despite declines in seven provinces (led by Newfoundland and Labrador at -13.5%). Ontario reported the most substantial rise in personal income taxes per capita (+11.1%).

Corporate income taxes per capita declined by 29.0% in Nova Scotia in 2023. Nationally, corporate income taxes per capita fell by 23.6% with declines in every province (led by Newfoundland and Labrador at -75.3%). Prince Edward Island reported the least decline in corporate income taxes per capita (-16.2%).

With ongoing inflation in 2023, higher sales prices contributed to rising per capita sales tax revenues in Nova Scotia (+7.1%). Nationally, general sales tax revenues per capita were up 4.2% with increases in seven of nine provinces with general sales tax (Alberta does not have a general sales tax). Increases in general sales tax revenues per capita were faster in Ontario and the Maritime provinces. Newfoundland and Labrador reported the steepest drop in general sales tax revenues per capita.

Excise taxes (such as tobacco and fuel) along with profits from fiscal monopolies (such as liquor and gaming) were down 2.9% per capita in Nova Scotia in 2023. Nationally, these revenues declined 4.9% per capita with declines in all provinces except Québec and Alberta. Ontario and Manitoba reported the sharpest declines in excise taxes and fiscal monopoly profits per capita.

Nova Scotia's consolidated provincial-local property tax revenues per capita increased by 3.0% - the fastest gain among provinces. Nationally property tax revenues per capita were down 2.0% with declines in all provinces except Nova Scotia, Québec and British Columbia. The sharpest decline in property taxes per capita was reported in Ontario (-4.5%).

Nova Scotia's consolidated provincial-local user fees declined 7.5% per capita in 2023. Nationally, user fee revenues per capita edged up 0.4% per capita on gains in five provinces (led by Saskatchewan). New Brunswick reported the steepest drop in per capita user fee revenues (-38.7%).

Per capita transfers for consolidated provincial-local governments were up in all provinces, led by Nova Scotia with a 10.0% gain. Nationally, per capita transfer revenues for consolidated provincial-local governments were up 4.5%. Prince Edward Island (+3.5%) reported the slowest increase.

Consolidated provincial-local revenues include substantial revenues from the sale of goods and services, which includes tuition fees, recreation fees and insurance premiums in provinces with public insurance corporations. Nova Scotia's per capita revenues from sales of goods and services increased by 4.3% in 2023 - third fastest among provinces. Nationally, sales revenue from goods and services rose 2.0% per capita with gains in five provinces. Prince Edward Island reported the largest decline in per capita revenues from sales of goods and services.

Expenses
Consolidated provincial-local government expenditures in Canada were $19,722 per capita. Nova Scotia's consolidated provincial-local government expenditures were $18,692 per capita - third lowest among provinces ahead of only Ontario ($18,037 per capita) and New Brunswick ($18,108 per capita). The highest per capita expenditures were in Saskatchewan ($22,632) and Québec ($22,209).

As with consolidated provincial-local government revenues, modest differences in per capita expenditures appear larger when measured relative to GDP per capita, which remained substantially larger in resource-producing provinces.

Nova Scotia's provincial local consolidated government expenditures amounted to 33.1% of GDP - the third highest among provinces. Across Canada, provincial-local expenditures amounted to 26.9% of GDP. With high GDP per capita, Alberta's provincial-local expenditures were the lowest at 20.4% of GDP.

Consolidated provincial-local government expenditures increased in all provinces except Prince Edward Island from 2022 to 2023. Growth in Nova Scotia was 3.6% in Nova Scotia, outpacing the national growth of 3.2%. Growth was fastest in Manitoba (+5.9%).

The largest components of consolidated provincial-local government expenditures were: employee compensation, purchases of goods and services, consumption of capital, social benefits, interest payments and subsidies.

Employee compensation was the largest component across national consolidated provincial-local expenditures, amounting to $7,349 per capita in Nova Scotia ($6,971 nationally). The highest employee compensation expenditures per capita were found in Newfoundland and Labrador and Saskatchewan. The lowest were reported in Ontario and British Columbia.
Compared with 2022, per capita consolidated provincial-local expenditures on employee compensation rose 4.4% in Nova Scotia. Nationally employee compensation expenditures for consolidated provincial-local governments were up 1.9% per capita with gains in all provinces except Ontario and Prince Edward Island. British Columbia reported the fastest rise.

Purchases of goods and services was the next largest expenditure category with a national average provincial-local government expenditure of $5,236 per capita. Nova Scotia provincial-local purchases of goods and services were $5,924 per capita. Expenditures on goods and services were highest in Alberta. Québec reported the lowest per capita purchases of goods and services by consolidated provincial-local governments.
Over the last year, Nova Scotia's consolidated provincial-local purchases of goods and services increased by 8.4% per capita. Nationally, these purchases were up 4.7% per capita with increases in all provinces except New Brunswick and Québec. Manitoba reported the fastest rise.

Capital consumption expenses per capita were $1,705 for Nova Scotia's consolidated provincial-local government sector in 2023, up 2.2% from 2022. Nationally, consolidated provincial-local capital consumption expenditures were $2,016 per capita in 2023, a 1.6% increase from 2022. Alberta reported the largest consolidated provincial-local capital consumption expenditures per capita while British Columbia reported the fastest growth. Manitoba (followed by Nova Scotia) reported the lowest per capita consolidated provincial-local capital consumption expenditures. Only Manitoba and Alberta reported declining consolidated provincial-local capital consumption expenditures per capita in 2023.

Interest expenses depend on net financial liabilities and costs of funds. Across Canada, provincial-local expenditures on interest payments averaged $1,241 per capita while interest costs were $772 per capita in Nova Scotia (third lowest after Alberta and British Columbia). The highest interest expenditures were in Québec.
Consolidated provincial-local government interest expenditures increased by 12.5% in Nova Scotia - third fastest after Québec and British Columbia. Nationally, consolidated provincial-local interest expenditures were up 10.1% per capita in 2023 with gains in all provinces. New Brunswick reported the least rise in consolidated provincial-local government interest expenditures.

Subsidies (particularly in agriculture) were uneven across the country, with an average of $956 per capita. The highest per capita subsidy payments were in Saskatchewan at $2,288 per capita - the largest by a wide margin. The lowest subsidies were paid in New Brunswick ($304 per capita), followed by Nova Scotia at $508 per capita.
Compared with 2022, Nova Scotia's consolidated provincial-local subsidies per capita increased by 1.0%. Nationally, per capita subsidies were up 2.2% with increases in five provinces (led by Saskatchewan). Newfoundland and Labrador reported the sharpest decline in per capita subsidies from provincial-local governments in 2023.

Social assistance and family/employment benefit expenditures per capita were $1,567 per capita across Canada, including notably higher expenditures in Québec. Nova Scotia's social benefits per capita from provincial-local governments were $1,300 in 2023. The lowest social benefits were paid in New Brunswick ($889 per capita) and Newfoundland and Labrador ($996 per capita).
Compared with 2022, Nova Scotia's social benefits per capita from provincial-local governments declined by 4.6%. Nationally, social benefits from provincial-local governments were down 6.8% per capita with declines in all provinces except New Brunswick, Prince Edward Island and Alberta. Newfoundland and Labrador reported the steepest decline in consolidated provincial-local social benefits per capita.

Net Operating Balance
The net operating balance of the consolidated provincial-local government sector reflects the difference between revenues and expenses. As this includes local governments, colleges, universities, workers' compensation boards and other entities, it is not comparable to statements of surplus or deficit for Provincial governments as reported in their respective Public Accounts.
In 2023, Nova Scotia ($661per capita), Alberta ($505 per capita), Prince Edward Island ($351 per capita) and New Brunswick ($179 per capita) all had positive net operating balances for provincial-local consolidated government. The largest net operating deficit was reported in Newfoundland and Labrador (-$3,067 per capita). The consolidated provincial-local government sector reported a deficit of $535 per capita across Canada.

Every province except Prince Edward Island reported a deterioration in net operating balance per capita in 2023.

Despite last year's decline, Nova Scotia's consolidated provincial-local government net operating balance has been improving since 2008.



Net Financial Worth
As with net operating balance, the net financial worth of the consolidated provincial-local government sector includes different entities and accounting treatments than reported by Provincial governments in Public Accounts.
All provinces report negative net financial worth of consolidated provincial-local governments, with an average of -$12,273 per capita across Canada. The three westernmost provinces and New Brunswick had the strongest net financial worth in 2023, followed by Nova Scotia and Prince Edward Island. Nova Scotia's provincial-local government net financial worth was -$9,456 per capita. The largest negative net financial worth per capita values were reported in Newfoundland and Labrador, Manitoba, Ontario and Québec.

Net financial worth per capita deteriorated for Nova Scotia in 2023. Nationally, negative net financial worth widened in 2023 with the largest deterioration in Newfoundland and Labrador (followed by British Columbia). There were improvements in Prince Edward Island, New Brunswick, Ontario, Saskatchewan and Alberta

Despite last year's setbacks, all provinces report improvements in net financial worth since 2020.



Statistics Canada. Table 10-10-0147-01 Canadian government finance statistics (CGFS), statement of operations and balance sheet for consolidated governments (x 1,000,000); Table 17-10-0009-01 Population estimates, quarterly; Table 36-10-0222-01 Gross domestic product, expenditure-based, provincial and territorial, annual (x 1,000,000)
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