CWF: Western Canadian Cities Face Infrastructure Crisis
December 1, 2003
CALGARY, Alta. - Canada West Foundation (CWF) has published a report indicating Western Canada's six major cities are facing an infrastructure deficit that could soon become a crisis.The cities of Van...
CALGARY, Alta. – Canada West Foundation (CWF) has published a report indicating Western Canada’s six major cities are facing an infrastructure deficit that could soon become a crisis.
The cities of Vancouver, Calgary, Edmonton, Regina, Saskatoon and Winnipeg have a collective infrastructure deficit of $564 million – an alarming number, according to the report entitled A Capital Question: Infrastructure in Western Canada’s Big Six. The per capita deficit ranges from $87 per person in Vancouver to a high of $298 in Winnipeg. Even more disturbingly, most Western Canadian cities reported they expect their infrastructure deficit to increase in upcoming years.
That’s a frightening trend for road users in particular, as highways represent one of the largest parts of the shortfall.
“For most western cities, the largest portion of the infrastructure deficit resides in transportation – roads, traffic control, bridges, interchanges and public transit,” the report states.
Unfortunately, it appears the situation may get worse before it gets better.
“On the positive side, most cities are planning to increase their investments in infrastructure over the next five years,” the report continues. “On the negative side, some cities will see little provincial and federal support for infrastructure. Because of the lack of funding to finance desperately needed infrastructure, most big cities in the West will likely see increased levels of tax-supported debt.”
The report suggests cities may have to consider debt-financing infrastructure projects.
“With interest rates at historically low levels, now may be the time for increased borrowing to build the West’s cities,” states the report. “However, debt-financing alone will not be able to close the infrastructure deficits facing the cities.”
If action isn’t soon taken to address the infrastructure deficit facing Western Canada, then there will be dire consequences, suggests report author and CWF senior policy analyst Casey Vander Ploeg.
“The potential long-term costs of failing to address the infrastructure issue are numerous, and include higher government operating costs, negative impacts on the environment, and threats to public health and safety,” he says.
“If governments continue to defer critical maintenance and rehabilitation of aging infrastructure, the costs down the road will be much higher – infrastructure will need to be replaced rather than repaired.”
In the report, Vander Ploeg examines 40 years of federal, provincial and municipal records to analyze trends in infrastructure investment.
“In the past 40 years public capital investment has fallen dramatically for all orders of government, including the local government sector, which is the traditional builder of infrastructure in the public sector,” he concludes.
The report suggests Canada has consumed too much of its wealth in recent years rather than re-investing that into important infrastructure projects.
In fact, Canada has one of the lowest rates of public and private investment as a percentage of GDP in the Organization for Economic Co-operation and Development (OECD), yet it has one of the highest rates of government consumption as a percent of GDP.
“For decades we seem to have been investing less and consuming more,” says Vander Ploeg.
A Capital Question is available for download at CWF’s Web site at www.cwf.ca.
You can also purchase a print version of the report for $5 at the same Web site.