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Canadian Government Finance Statistics, 2008 to 2012 (provisional)

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Released: 2014-11-19

Provisional estimates of the Canadian Government Finance Statistics (CGFS) are now available for the period 2008 to 2012. This is the first of three releases and covers the statement of operations for all components of general government, as well as federal and provincial and territorial government business enterprises. Data on the functional expenses will be released on November 26, followed by the financial assets and liabilities in early 2015.

The data sources, methods and concepts that underlie the CGFS-based data depart significantly from the Financial Management System (FMS)-based data previously published by Statistics Canada.

Given the magnitude of these differences, Statistics Canada has decided to release the data with the provisional qualifier. This qualifier signals to users that although the data are fit for use, they are subject to revisions. Over the next year these data will be integrated into the rest of the Canadian System of Macroeconomic Accounts (the national accounts, balance of payments, international investment position, input-output tables), resulting in revisions as data, concepts and methods are reconciled and aligned within the national accounts framework.

The data will retain their provisional status until a number of improvements are implemented over the next year. These improvements include balancing grants across levels of government, adding capital expenditures and capital stock as well as consolidation of inter-sector transactions and stock positions.

While some of the detailed series will be revised over the next year and some data gaps will remain, the general story and trends found in the current data will remain similar.

Government Finance Statistics

Government Finance Statistics can be used to study the financial position, liquidity and operations of the different levels of governments in a consistent and systematic manner. Public accounts information cannot be used for this purpose because the data, while compiled according to Public Sector Accounting Board standards, can be reported differently from one jurisdiction to another and are therefore difficult to compare.

Countries around the world are aligning or have already aligned their government finance statistics to the international standard that was developed by the International Monetary Fund. Canada now joins Australia as one of the very few countries to compile Government Finance Statistics directly from government accounting records, providing users with higher quality statistics and far greater detail.

Gross operating balance

One of the most important analytic measures in the CGFS framework is the gross operating balance. The gross operating balance is equal to revenues less expenses (excluding consumption of fixed capital) and is used to measure the sustainability of government operations. The higher a gross operating balance, the less a government will need to borrow to fund its purchases of non-financial assets and the more flexibility it will have in delivering current services to the public.

Following the 2008 global financial crisis, the Government of Canada implemented the Economic Action Plan. The Economic Action Plan had a significant impact on the federal government's gross operating balance, moving the federal government from an operating surplus in 2008 to an operating deficit in 2009. Since that time the government's operating balance has improved each year as revenue growth has averaged 3.4% each year compared with a 0.2% average annual increase in expenses.

Chart 1  Chart 1: Federal government gross operating balance, 2008 to 2012 - Description and data table
Federal government gross operating balance, 2008 to 2012

Chart 1: Federal government gross operating balance, 2008 to 2012 - Description and data table

A similar story to the federal one exists at the provincial and territorial level. Over the five-year period, from 2008 to 2012, the Ontario provincial government (includes core general government plus autonomous funds and organizations, such as Workers' Compensation Boards) accumulated a gross operating deficit in excess of $80 billion. Newfoundland and Labrador, Quebec, Saskatchewan and the three territorial governments reported a gross operating surplus for the same five-year period.

Chart 2  Chart 2: Provincial and territorial government cumulative gross operating balance, 2008 to 2012 - Description and data table
Provincial and territorial government cumulative gross operating balance, 2008 to 2012

Chart 2: Provincial and territorial government cumulative gross operating balance, 2008 to 2012 - Description and data table

Role of government

Government Finance Statistics clearly distinguish the role of the different levels of government. One important function of the federal government is to administer tax programs and transfer funds to individuals or other levels of government. In all, more than 80% of federal revenue is accounted for by tax revenue and over 60% of expenses are dedicated to grants or social benefits. This contrasts with local general governments, where a large share of their revenue is in the form of grants (19%) or users fees (26%) such as water and sewer charges. Likewise, a larger share of their expenses is on the use of goods and services and compensation of employees when compared with the federal government.

Chart 3  Chart 3: Average revenue proportions by government sector, 2008 to 2012 - Description and data table
Average revenue proportions by government sector, 2008 to 2012

Chart 3: Average revenue proportions by government sector, 2008 to 2012 - Description and data table

Chart 4  Chart 4: Average expense proportions by government sector, 2008 to 2012 - Description and data table
Average expense proportions by government sector, 2008 to 2012

Chart 4: Average expense proportions by government sector, 2008 to 2012 - Description and data table

A word of caution when making provincial and territorial comparisons

In the current version of the Canadian Government Finance Statistics, data are not consolidated and, therefore, users cannot use the data to make provincial and territorial comparisons. For example, users cannot sum together provincial or territorial general government expenses with local general government expenses in a given province or territory, since doing so may result in double-counting of government expenses in the province or territory.

Double counting of expenses may occur because some of the expenses of the provincial or territorial general government are recorded as transfers to the local general government, who then use these funds to administer programs. Simply adding the expenses together will exaggerate the total general government expenses within a province or territory.

Provincial and territorial comparisons can only be undertaken once the data have been consolidated and inter-government transfers have been netted out. Until consolidated data are released, analysis should be limited to time-series analysis of a specific level of government within a province or territory.

  Note to readers

No total government sector aggregate is provided in this first release of the Canadian Government Finance Statistics as further refinement of the data is required to eliminate the transactions between levels of government. Consolidated government data of all levels of government will be available with the November 2015 Canadian Government Finance Statistics release.

Data corresponds to the end of the fiscal year closest to December 31. For example, data for the federal government fiscal year ending on March 31, 2010 (fiscal year 2009/2010), are reported in reference year 2009.

The initial compilation of the Canadian Government Finance Statistics was a complex undertaking including structural, presentational, conceptual and statistical changes. Regular users of Statistics Canada's data are urged to familiarize themselves with these changes.

The classification structure Canadian Government Finance Statistics 2014 is now available in the Definitions, data sources and methods module of our website.

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (613-951-4636; statcan.mediahotline-ligneinfomedias.statcan@canada.ca).

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