April 1, 2013
A new report from the Mowat Centre at the School of Public Policy at the University of Toronto has found that a gap of $11 billion annually exists…
Toronto – A new report from the Mowat Centre at the School of Public Policy at the University of Toronto has found that a gap of $11 billion annually exists between Ontarians’ contribution to federal revenues and what is, in turn, received from the federal government.
Inter-regional redistribution away from Ontario continues, even though Ontario is no longer wealthier than the average province. The new study uses fiscal data from 2009, the most recently available data, to estimate this redistribution.
According to the study, there are few regional inequities in federal taxation. Almost all of the $11 Billion gap is due to inequities in federal spending.
“Ontarians still receive less than their per capita share of spending and transfers. These inequities are found in a range of federal programs, including infrastructure, housing, job training, energy, regional economic development, equalization and the federal EI program,” said Noah Zon, the author of the study.
Despite a focus in the recent federal budget on some Ontario priorities, like the manufacturing sector, the structural issues in federal program spending have not been addressed.
According to Matthew Mendelsohn, the Mowat Centre’s Director, these inequities could be easily addressed: “All that is required is that the federal government reform rules and fiscal allocation formulae that are a legacy of the past.
The Report also recommends that the federal government begin reporting again the breakdown of federal expenditures and revenues by province, which it stopped doing in 2009.Read the full report