Interest on government debt costs taxpayers $62.8B: study
That translates into $1,752 for every Canadian, or more than $7,000 for a family of four.
VANCOUVER — Looking for an update on how much climbing government debt is costing you and your family in interest payments?
The Fraser Institute has updated the numbers and it’s not pretty. Paying the interest on all government debt in Canada cost taxpayers $62.8 billion last year, which translates into $1,752 for every Canadian or slightly more than $7,000 for a family of four.
The public policy think-tank found federal and provincial debt in 2016/17 will total $1.4 trillion, an increase of more than half-a-trillion dollars since 2007/08, when government debt started to climb.
“It’s not a choice – interest must be paid on government debt, and the more money governments spend on interest payments the less money is available for the programs and services that matter to Canadians,” said Charles Lammam, director of fiscal studies at the Fraser Institute and co-author of The Cost of Government Debt in Canada, 2017.
Interest payments on all government debt – federal, provincial and municipal – in 2015/16 cost roughly the same amount as what the country spent on public primary and secondary education combined, which totalled $63.9 billion in 2013/14, the last year of available data.
Interest payments on just the federal debt – $24.9 billion – is roughly the same as the federal government’s projected deficit this year – $25.1 billion.
Taxpayers in different provinces carry different debt interest burdens.
Interest on Ontario’s debt is $11.4 billion, but add its portion of federal debt interest payments ($9.8 billion) and the total is $21.2 billion, which the think tanks says is almost equal to what the province collects in HST ($23.8 billion).
Alberta’s combined provincial-federal debt interest payments will cost $5.3 billion this year, which is more than the province will spend on social services, including welfare.
In BC, interest payments for both the provincial debt and its share of the federal debt ($5.6 billion) are comparable to what the province collects in PST.
Download the report here.