Public Policy Sources #39:
Introduction
The Budget Performance Index measures the recent fiscal performance of the provinces and the federal government. The index incorporates a variety of measures of spending, tax rates, tax revenues, deficits, and debt. This study aims to provide Canadians with information about how their local and provincial governments tax, spend, and manage debt relative to other Canadian jurisdictions.
This study is meant to provide more detailed comparisons among the provinces than that allowed by The Fraser Institute's Fiscal Performance Index, which only compares the taxing and spending actions of the Canadian provinces to each other and to the US states. Thus, for purely Canadian comparisons, the Budget Performance Index is best; for Canada-US comparisons, the Fiscal Performance Index is more appropriate.
As this study uses consolidated provincial-local data, all references to an individual province include both provincial and local government activities. Consolidated data ensures that those provinces with a high concentration of spending responsibility and taxation authority at the provincial level (see figure 1) do not get penalized simply because of this difference. The change in focus from provincial to consolidated data was suggested by one of the provincial finance departments. Suggestions of this sort regarding methodology are welcome.
The period over which most variables in the study are measured is fiscal year 1995/96 through fiscal year 1999/00. The exceptions are tax rates, which are measured in calendar years 1995 and 1999, and debt per capita and debt as a percent of GDP, which are measured from fiscal year 1994/95 through fiscal year 1998/99.
The remainder of this study is organized into three parts. The "Budget Performance Index" section presents the tables for the overall index and its sub-indices. "Jurisdictional Analysis" provides each jurisdic- tion's score and rank for the overall index and sub-indices as well as a brief discussion of the jurisdiction's performance. The "Methodology" section provides details on the data used, and comments on the construction of the index.
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