December 20, 2013
Canadians have added a bit of debt in the aftermath of the economic downturn, and so too have their governments. But some provinces are faring better than others when it comes to provincial budget deficits and provincial debt per person.
The province that calls itself the “best place on earth” had a $1.1 billion dollar deficit for fiscal 2012-2013. Breaking it down by person, Canada’s westernmost province has $8,249 in debt per resident.
The oil-rich province has hit a bit of a rough spot, and is in a budget deficit. The province is $2.8 billion in the red for the 2012-2013 fiscal year. But things look brighter in the big picture, as Alberta has no debt and for each person in the province, there is a $3,122 cumulative surplus.
This Prairie province has something to cheer about. Its government eked out a $58 million budget surplus for the last fiscal year, helped along by strong royalties from potash and oil and gas. But the province with the motto “Strength from Many Peoples” has $3,542 in debt per person.
Though the province may have the Winnipeg Jets hockey team to cheer on, they can’t say the same about Manitoba’s finances. The province had a $583 million deficit, blamed by the government on a bad combination of flooding and a weak global economy.
Broken down per person, each resident of Manitoba represents $12,722 in government debt.
Battered by a shrinking manufacturing sector, the provincial government rang in an $11.5 billion deficit in fiscal 2012-2013. Though the government has cut the deficit in recent years, it hasn’t yet erased it. The country’s largest province has 13.5 million residents. For each one of them, the government carries $18,717 in debt.
Quebec’s budget deficit comes in at $1.5 billion. When compared to other provinces, including its powerhouse neighbour Ontario, that doesn’t look too bad. But take a look at its per-person debt breakdown, however, and the picture isn’t quite so rosy. When it comes to debt per Quebecker, the province leads the pack with $21,922 in debt per resident.
The most populous province in Atlantic Canada has the Osprey as its official bird. Despite the best efforts of its government, Nova Scotia is struggling to make its budget deficit fly away. Last year the province spend $302 million more than it took in. Its public debt breaks down to $14,708 per person.
The province has a bigger deficit than its Maritime rival Nova Scotia. New Brunswick’s budget was $411 million in the red in fiscal 2012-2013, and had $14,553 in debt per person.
Newfoundland and Labrador
Also struggling is the island province of Newfoundland and Labrador. The easternmost province had a $431 million deficit last year. Breaking its total amount owed down results in $16,743 debt per person.
Prince Edward Island
Tiny Prince Edward Island had a $69 million deficit in its budget last fiscal year. The province has $12,700 in debt per person.
Debt or Deficit?
With just about every Canadian province operating in a deficit for the 2102-2013 fiscal year, the picture isn’t exactly rosy. And while most people know that a deficit is negative and debt is negative, many are confused about the difference between the two.
Basically, they both have to do with owing money, but are not the same thing. As far as governments go, a deficit occurs when they spend more than they take in over the course of one year. When this happens, they have to borrow money to make up the difference. That borrowed amount is their debt, and it continues to grow as more and more deficits accumulate. As an example, three years of a province running a $400 million deficit puts them $1.2 billion in debt.
The Personal Effect
As most people know, debt is also an issue on a personal level. While the provinces look for ways to make a profit, many of the citizens struggle with their own debts. Personal debt has an effect on credit scores, it increases stress levels and can affect overall health. It’s important for families to try and keep debt levels in check so they are healthier and happier and the provinces they live in can turn things around.
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