OTTAWA—Compared to the beginning of this year, provincial governments have kicked in more money to combat the ongoing COVID-19 pandemic and are sitting on less unspent federal money, according to a new study from the Canadian Centre for Policy Alternatives (CCPA).
Still Picking up the Tab: Federal and provincial government COVID-19 spending updates a similar January analysis and finds that the provinces have increased their contributions, but the majority of spending continues to come from Ottawa. Alberta has received the highest level of COVID-19 support from Ottawa, followed by Ontario.
As of federal and provincial spring budgets, a total of $366 billion (86%), including $29 billion in transfers to the provinces, had been spent by the federal government on direct COVID-19 measures. The provinces have contributed $57 billion (14%). This has changed from the January update, which showed the federal government was covering 92% of the cost and provincial governments were covering 8%.
“With their spring budgets, many provinces picked up more of the slack on COVID-19 spending, but they’re still relying on the federal government to do the heavy lifting,” says study author and CCPA Senior Economist David Macdonald.
In his previous report, Macdonald found that almost every province was sitting on unspent funds, totalling billions of dollars. Now, there are fewer unallocated amounts overall.
Among the report’s findings:
Following the previous report highlighting the issue, Alberta drew on the federal wage top-ups for low-wage essential workers, but has substantially increased its unallocated funds, from $750 million in the January report to almost $1.8 billion. Its unallocated funds exceed the provinces’ total detailed expenditures in 2021-22.
Saskatchewan is now the province leaving the most federal support for low-wage essential workers on the table. Of the $103 million in federal funds available to it, the province has left $69 million either unapplied for or undistributed.
Of all 10 provinces, only Ontario and British Columbia fully matched federal support for municipalities (although Quebec and Alberta came close). None of the smaller provinces provided significant matching support to their municipalities.
New Brunswick and P.E.I. had the lowest provincial pandemic spending at under 0.5% of their GDP. However, Atlantic provinces have seen lower COVID-19 rates than the rest of the country. B.C. and Quebec had the highest levels of provincial support amounting to 3.5% and 3.4%, respectively.
Alberta received by far the most federal direct support of any province, amounting to $11,410 per person, Ontario was second highest receiving $9,940 per person.
Overall, more money was spent on support for businesses ($176 billion) than for individuals ($151 billion). Health care was a distant third, receiving $64.5 billion in support across federal and provincial spending.
“With the federal government shouldering most of the costs of this pandemic, even in areas like health care, there is no room for provincial austerity in the years ahead,” adds Macdonald.
The full report is available for download on the CCPA website. Note: The report tracks which level of government picked up the tab for any COVID-19 program announced in each government’s 2021 spring budget, which will be implemented in the three fiscal years 2019-20 through 2021-22. The distributional proxies used to allocate federal dollars to particular provinces often weren’t available for the territories. As such, the analysis was not extended to the territories.
For interviews contact: Alyssa O’Dell, senior communications specialist, at 343-998-7575 or [email protected]
The CCPA is an independent, non-profit charitable research institute founded in 1980.