Welcome!

News Feed Item

The Fraser Institute: McGuinty Ranked Eighth Out of 10 Premiers for Managing Provincial Finances; Successor Must Deal With Legacy of Poor Fiscal Management

TORONTO, ONTARIO -- (Marketwire) -- 12/06/12 -- Outgoing Ontario Premier Dalton McGuinty has one of the worst records among Canadian premiers for managing provincial finances, according to a new analysis of the fiscal records of 10 Canadian premiers, released today by the Fraser Institute, Canada's leading public policy think-tank.

But with Premier McGuinty poised to step down, whoever succeeds him has an opportunity to break from past fiscal policies and focus efforts on improving the management of Ontario's finances, says Charles Lammam, Fraser Institute economist and co-author of Measuring the Fiscal Performance of Canada's Premiers 2012.

"Research shows sound fiscal policy is a key determinant of a province's long-term economic success. Unfortunately, when Premier McGuinty leaves office, he will have left a legacy of poor fiscal management in comparison to the records of other Canadian premiers," Lammam said.

Measuring the Fiscal Performance of Canada's Premiers 2012 ranks McGuinty eighth overall with a score of 28.9 out of 100. Only Robert Ghiz of Prince Edward Island (23.5 out of 100) and Greg Selinger of Manitoba (19.2 out of 100) scored worse.

Kathy Dunderdale (Newfoundland and Labrador) ranked first overall with a score of 71.4. David Alward (New Brunswick) placed a close second, scoring 70.4, while Brad Wall of Saskatchewan ranked third (61.6) and British Columbia's Christy Clark was fourth (60.8).

The report measures the fiscal performance of 10 Canadian premiers relative to each other (eight current and two former) during their time in office up to the 2011/12 fiscal year. Each premier received an overall score (out of 100) and rank (out of 10) based on their performance on three components of fiscal policy: government spending, taxes, and debt and deficits.

Government Spending

A large body of academic research shows that excessive increases to government spending can hinder an economy's performance.

McGuinty ranked ninth overall on the government spending component with a score of 12.3 out of 100. New Brunswick's Alward was first on this measure with a score of 88.5.

While in office, McGuinty increased program spending by an average of 6.1 per cent annually-nearly twice the combined rate of inflation and population growth (3.1 per cent) and well over Ontario's annual economic growth rate (3.6 per cent).

"Premier McGuinty resorted to a combination of tax hikes and increased debt to finance large spending increases. This inability to prudently manage government spending was his major failing," Lammam said.

Taxes

Tax rates and the structure of the tax system have a significant impact on incentives that influence whether businesses and individuals engage in productive economic activity.

McGuinty fared better on tax policy, ranking fifth overall with a score of 54.8, one of only five premiers to score above 50.0. Alward again topped the rankings with 87.6 out of 100.

"Premier McGuinty increased several taxes shortly after coming to power in 2003 but reversed course in 2009 when he announced several tax reforms," Lammam said.

"Unfortunately, earlier this year he indicated that Ontario will not follow through on plans to reduce its corporate tax rate to 10 per cent by 2013, a plan that would have improved the provincial investment climate."

Debt and Deficits

Debts and deficits are a critical aspect of fiscal performance because annual deficits increase the overall level of government debt, requiring more tax dollars to be spent on interest costs and less on public services and tax relief.

McGuinty scored 19.7 out of 100 on the debt and deficit measure, ranking him ninth overall. Newfoundland's Dunderdale and Saskatchewan's Wall tied for first, each scoring a perfect 100 for averaging a budget surplus during their tenure and reducing the share of government debt in the provincial economy.

McGuinty, on the other hand, averaged a deficit over his tenure and increased Ontario's debt to 36.0 per cent of the economy in 2011/12 from 28.2 per cent in 2003/04. A $14.4 billion deficit is planned for 2012/13 with deficits expected to continue until 2017/18.

"Ongoing deficits and increased government debt will be a drag on economic growth and add to the burden of repayment for Ontario's next generation," Lammam said.

"Since we began measuring the fiscal performance of Canadian premiers, Premier McGuinty has consistently been ranked among the bottom three. Now with Premier McGuinty stepping down, his successor has an opportunity to better manage provincial finances and set the foundation for a stronger Ontario economy."

Follow the Fraser Institute on Twitter

Become a fan on Facebook

The Fraser Institute is an independent Canadian public policy research and educational organization with offices in Vancouver, Calgary, Toronto, and Montreal and ties to a global network of 86 think-tanks. Its mission is to measure, study, and communicate the impact of competitive markets and government intervention on the welfare of individuals. To protect the Institute's independence, it does not accept grants from governments or contracts for research. Visit www.fraserinstitute.org.

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

Latest Stories
Security, data privacy, reliability and regulatory compliance are critical factors when evaluating whether to move business applications from in-house client hosted environments to a cloud platform. In her session at 18th Cloud Expo, Vandana Viswanathan, Associate Director at Cognizant, In this session, will provide an orientation to the five stages required to implement a cloud hosted solution validation strategy.
"Avere Systems is a hybrid cloud solution provider. We have customers that want to use cloud storage and we have customers that want to take advantage of cloud compute," explained Rebecca Thompson, VP of Marketing at Avere Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
"We formed Formation several years ago to really address the need for bring complete modernization and software-defined storage to the more classic private cloud marketplace," stated Mark Lewis, Chairman and CEO of Formation Data Systems, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
There will be new vendors providing applications, middleware, and connected devices to support the thriving IoT ecosystem. This essentially means that electronic device manufacturers will also be in the software business. Many will be new to building embedded software or robust software. This creates an increased importance on software quality, particularly within the Industrial Internet of Things where business-critical applications are becoming dependent on products controlled by software. Qua...
When it comes to cloud computing, the ability to turn massive amounts of compute cores on and off on demand sounds attractive to IT staff, who need to manage peaks and valleys in user activity. With cloud bursting, the majority of the data can stay on premises while tapping into compute from public cloud providers, reducing risk and minimizing need to move large files. In his session at 18th Cloud Expo, Scott Jeschonek, Director of Product Management at Avere Systems, discussed the IT and busin...
As organizations shift towards IT-as-a-service models, the need for managing and protecting data residing across physical, virtual, and now cloud environments grows with it. Commvault can ensure protection, access and E-Discovery of your data – whether in a private cloud, a Service Provider delivered public cloud, or a hybrid cloud environment – across the heterogeneous enterprise. In his general session at 18th Cloud Expo, Randy De Meno, Chief Technologist - Windows Products and Microsoft Part...
SYS-CON Events has announced today that Roger Strukhoff has been named conference chair of Cloud Expo and @ThingsExpo 2016 Silicon Valley. The 19th Cloud Expo and 6th @ThingsExpo will take place on November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. "The Internet of Things brings trillions of dollars of opportunity to developers and enterprise IT, no matter how you measure it," stated Roger Strukhoff. "More importantly, it leverages the power of devices and the Interne...
Large scale deployments present unique planning challenges, system commissioning hurdles between IT and OT and demand careful system hand-off orchestration. In his session at @ThingsExpo, Jeff Smith, Senior Director and a founding member of Incenergy, will discuss some of the key tactics to ensure delivery success based on his experience of the last two years deploying Industrial IoT systems across four continents.
Most organizations prioritize data security only after their data has already been compromised. Proactive prevention is important, but how can you accomplish that on a small budget? Learn how the cloud, combined with a defense and in-depth approach, creates efficiencies by transferring and assigning risk. Security requires a multi-defense approach, and an in-house team may only be able to cherry pick from the essential components. In his session at 19th Cloud Expo, Vlad Friedman, CEO/Founder o...
"We host and fully manage cloud data services, whether we store, the data, move the data, or run analytics on the data," stated Kamal Shannak, Senior Development Manager, Cloud Data Services, IBM, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
CenturyLink has announced that application server solutions from GENBAND are now available as part of CenturyLink’s Networx contracts. The General Services Administration (GSA)’s Networx program includes the largest telecommunications contract vehicles ever awarded by the federal government. CenturyLink recently secured an extension through spring 2020 of its offerings available to federal government agencies via GSA’s Networx Universal and Enterprise contracts. GENBAND’s EXPERiUS™ Application...
With the proliferation of both SQL and NoSQL databases, organizations can now target specific fit-for-purpose database tools for their different application needs regarding scalability, ease of use, ACID support, etc. Platform as a Service offerings make this even easier now, enabling developers to roll out their own database infrastructure in minutes with minimal management overhead. However, this same amount of flexibility also comes with the challenges of picking the right tool, on the right ...
"We view the cloud not really as a specific technology but as a way of doing business and that way of doing business is transforming the way software, infrastructure and services are being delivered to business," explained Matthew Rosen, CEO and Director at Fusion, in this SYS-CON.tv interview at 18th Cloud Expo, held June 7-9, 2016, at the Javits Center in New York City, NY.
The Internet of Things will challenge the status quo of how IT and development organizations operate. Or will it? Certainly the fog layer of IoT requires special insights about data ontology, security and transactional integrity. But the developmental challenges are the same: People, Process and Platform. In his session at @ThingsExpo, Craig Sproule, CEO of Metavine, demonstrated how to move beyond today's coding paradigm and shared the must-have mindsets for removing complexity from the develo...
SYS-CON Events announced today that MangoApps will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. MangoApps provides modern company intranets and team collaboration software, allowing workers to stay connected and productive from anywhere in the world and from any device.