The data on provincial debt indicates that Alberta has plenty of room to borrow more money. Alberta’s March 2011 net debt is in a negative position, indicating that its low level of debt is outweighed by its financial assets. But without better policies and practices, Alberta’s public debt can become an unruly beast.
New Zealanders still have time to correct problems with municipal amalgamation that have been identified in large amalgamated Canadian municipalities.
The perennial game of political football over who should fund rural roads could end with better integrated engineering and accounting practices that identify the most damaging road uses; then, Canadian governments could charge users according to the maintenance they necessitate.
Reforms of local government rarely, if ever are advanced by local governments themselves. Invariably reform will only occur as it did in New Zealand if higher government driven by determined reformers do it, not the units of local government themselves.
Personnel recruitment of top rate professionals by municipalities suffers at present because local government is seen by potential employees as being both devoid of interest and unglamorous. This perception can only be changed, if with excellent leadership, municipalities rise to the challenge.
Given the amount of money involved, senior levels of government and other funding agencies are entitled to insist upon better management practices in support of municipal funding proposals. The goal is a process based on uniformly better financial and asset management information and practice.
Canadian municipalities currently produce financial information that is deficient because of limited disclosure and accounting for liabilities. These omissions include a failure to properly account for asset costs leading to accrued asset maintenance deficits, pension fund future liabilities and environmental and disaster contingency funds. For the huge sums involved, to base major borrowing decisions upon financial information that is this complete is imprudent and may border on the reckless.
If good local government is to be achieved a better standard of performance must be mandated for municipalities within Canadian local government empowering legislation.
Unlike the obvious difference between those two items, Canadian municipalities often mix up two very different accounting categories—operating and capital expenditures. The result is that an educated reader is left to guess about municipal financial statements.
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