Warning Bells Sounded Over Provincial and Territorial Debt

By The Canadian Press
June 28, 2016 - 3:07pm

The parliamentary budget office says the debt being racked up by the provinces, territories and municipal governments is rising at a rate that is fiscally unsustainable.

The federal budget watchdog says the combined net debt of the country's so-called subnational governments is currently at 32.5 per cent of G-D-P but it's projected to rise to more than 200 per cent over the next 75 years.

It blames increased spending projections for health care and public sector administration.

The P-B-O warns that at that level, debt service payments would reach 11 per cent of gross domestic product.

The report says some combination of higher federal transfers, spending cuts and boosts to government revenue would be necessary to improve the subnational outlook. (The Canadian Press)
 

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