BC Municipal Spending Watch – 3rd Edition, December 2010 – Released by the Canadian Federation of Independent Business

Janet Irvine: Dec. 4, 2010

With respect to municipal spending in Nanaimo –  At the Regular Meeting of Council held on November 8th, Council directed Staff to:

1.    “start the process of a core service review” – amended motion carried as follows:   “report back to council on the content and estimated time and cost of a core service review”;  and

2.    “report on the process of a zero based budget” – amended motion carried to include the wording:  “for the 2012 budget year.”

A highly relevant report released this week by the Canadian Federation of Independent Business extends their analysis of municipal financial data from 2000 to 2008: “BC Municipal Spending Watch – 3rd Edition, December 2010″

http://www.cfib-fcei.ca/cfib-documents/rr3222.pdfSome interesting excerpts at pages 19 and 20:

“EXPENDITURES: CORE SERVICES vs. “NICE TO DO” SERVICES

What are core municipal services? Although this seems to be a very simple question, the definition of core municipal services is open to interpretation. The UBCM/ provincial government publication, Local Government in British Columbia—4th edition explains that there are functions mandated by the province and voluntary functions. Mandated functions can also include instructions from the province on how to organize these functions.”

“SALARIES AND BENEFITS OF EMPLOYEES

Public wages are the largest municipal operating budget expenditure. CFIB research comparing public and private sector wages and benefits shows that, on average in BC, municipal workers earn 10.4 per cent more than their private sector counterparts in the same job (see Figure 5.2). When you add in benefits, this premium soars to a shocking 34.9 per cent.”

SEE ALSO – SECTION 6: FEEDBACK

The CFIB makes a number of recommendations for provincial and municipal governments to try to rein in spending, including:

-limiting operational spending increases to population and inflation growth;

-freezing municipal wages until they are within five per cent of wages for equivalent positions in the private sector;

-using zero-based budgeting instead of the traditional budgeting process, which treats existing levels of spending as a given; and

-creating an independent municipal auditor general to oversee local government budgets and spending.

One would assume that Staff will be reporting back to Council on the core review and zero based budget directives sometime in 2011, which, of course, is the last year of this Council’s term.  Although these Council directives are very worthy, 2011 is an election year, and one is left to wonder if decisions made by the present Council regarding these matters would be binding on the incoming Council.  Does anyone know the answer to this?

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