The Yukon government spent $675 million more than it budgeted between 2000 and 2015, according to a new report from the C.D. Howe Institute.
The report, titled “Controlling the Public Purse,” also gave Yukon a C+ grade for the clarity of its financial reporting.
The paper shows that the Yukon government has consistently spent more than it budgeted at the beginning of each fiscal year.
Author Colin Busby said that’s problematic, because it makes it harder for the average person to track how the government is spending taxpayer money.
Only Nunavut has performed worse than the Yukon in terms of overshooting its budgets, the report found.
Typically, when the government needs to spend more than it budgeted, it will issue supplementary budgets later in the fiscal year.
Busby said those are necessary during emergencies and other exceptional circumstances, but they shouldn’t be overused.
“It’s hard to say convincingly that supplementary estimates receive the same amount of scrutiny that the main estimates in the budget do,” he explained.
The Yukon government has also routinely underestimated revenues, to the tune of $390 million between 2000 and 2015.
Busby said governments will sometimes deliberately low-ball revenue estimates, and will then spend the extra money when revenues come in higher than planned.
He said there’s some evidence that the Yukon has done this, though not as much as some other jurisdictions.
“This is a concerning practice,” he said.
Busby said a big part of Yukon’s C+ grade has to do with the fact that the territory’s financial documents include both consolidated and non-consolidated figures, which can make it difficult for people to track budget numbers from year to year.
“It’s really hard to figure out which ones are the right ones. Experts struggle with these things,” he said. “If people are stumped off the bat … then there’s a big problem.”
Busby said the Yukon should just scrap the non-consolidated numbers in its public accounts, as those figures aren’t audited.
He said improving clarity would help to improve accountability.
“As these things get easier to read, the likelihood of governments following through on their targets will improve as well.”
Still, Busby said the Yukon has made progress in terms of improving consistency among its financial documents.
“You’re already doing above what the other territories are doing, as far as I’m concerned,” he said.
NDP Opposition Leader Liz Hanson took the government to task about the report in the legislative assembly this week.
“Will the premier finally admit that, with three years of recessions and yet another dressing-down by a national organization, he has failed to responsibly manage Yukoners’ money?” she asked during question period.
But Premier Darrell Pasloski defended his government’s fiscal track record.
“This government has done nothing but lower taxes for all Yukon taxpayers and Yukon small businesses and has no net debt,” he said. “Money in the bank and no tax increases are the best indicators of financial management in this territory.”
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