Nova Scotia's net debt too high: auditor general
Jacques Lapointe's last report as Nova Scotia's auditor general
Nova Scotia's auditor general recited a familiar yet grim warning Thursday about the province's growing debt.
Jacques Lapointe called attention to the fact that Nova Scotia's net debt per capita in 2012-13 is $14,832 for every man woman and child in the province.
"This remains a considerable burden for future generations," Lapointe said after releasing his final report before he retires this month.
Lapointe said of five provinces auditors compared Nova Scotia to — New Brunswick, Prince Edward Island, Newfoundland and Labrador, Alberta and Saskatchewan — only the residents of Newfoundland and Labrador carry a heavier debt burden.
As well, Lapointe said that although the total net debt has remained relatively stable over the past 10 years, it has increased by $1.6 billion to $13.9 billion.
The per capita debt has jumped by almost $2,000 — an increase of 13 per cent in the past four years alone — even though the province's population has remained flat.
"It would be nice to at least stabilize it at some point so that we quit adding to that burden," said Lapointe, noting that the province's aging population isn't helping matters.
"This is something that's coming down the track in the future, so it doesn't help the province in being able to deal with the debt issue."
According to the 2011 census, Nova Scotia's population had the highest proportion of seniors in Canada at 16.6 per cent. And the province's median age was 43.7 years — tied with New Brunswick for second-oldest in the country. Newfoundland and Labrador led the way at 44.
It's not the first time the soft-spoken auditor general has raised a red flag about debt.
In January 2012, he released a report that asked whether it's fair for governments to spend more than they earn while leaving the tab for someone else.
"Government's practice of borrowing to pay for current expenditures raises ethical questions," he wrote. "Is it right for Nova Scotians to expect and receive government services that they as a group do not completely pay for, deferring part of the payment to future generations?"
At the time, the NDP's finance minister, Graham Steele, challenged Lapointe's use of the term "ethical," saying it was a politically loaded word. Other members of the governing NDP said Lapointe was straying from his mandate into an area best left to politicians.
Since then, Lapointe has repeatedly warned that the province's debt has limited the government's ability to deliver public services.
Premier Stephen McNeil said part of the higher debt is caused by spending on capital projects.
"It will become the responsibility of cabinet and our government as we continue to build on capital projects going forward that we rein in some of the overspending that's taken place, some of the poor projections that have taken place to make sure that we have a true sense of the money that we're spending on capital and then prioritize," he said.
The renewed admonition Thursday was welcomed by Conservative Leader Jamie Baillie, who has made debt reduction the centrepiece of his political agenda.
"Once again, he's highlighted that we're on an unsustainable path with our debt and deficits," Baillie said. "To me, it's a call to action. It's time for the government to actually get a grip on our finances."
Lapointe's report also examined the pension plan for civil servants, saying he couldn't verify the accuracy of benefits paid to most retired employees of the provincial government and the Capital Health District.
Lapointe said if retirees were to question the accuracy of their pension benefits, there would be no way for the government to verify the claim.
However, Lapointe said this he did not know of any retirees in this position or any mistakes made as a result of gaps in documentation.
- A previous Canadian Press story said Nova Scotia had the second highest debt in Canada. Nova Scotia had second highest levels among six provinces examined, not the second-highest in the countryJan 24, 2014 5:54 AM AT