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The province of Newfoundland and Labrador’s government debt is $14.6 billion, which amounts to nearly $27,800 per person living in Newfoundland and Labrador. By comparison, the average per person debt owed in the remaining nine provinces is only $14,868.
TORONTO, Oct. 17, 2019 /CNW/ – Only thirteen percent (13%) of Canadians are aware of the high levels of government debt in the province of Newfoundland and Labrador, according to a new Ipsos poll conducted on behalf of the Schroeder Policy Group.
“Newfoundland and Labrador’s economy is in crisis, but most of Canada remains unaware – including our federal leaders,” said Walter Schroeder, founder of the Schroeder Policy Group. “This should be an issue in this election. Instead, we have nothing but silence.”
Awareness levels are, naturally, highest in Newfoundland and Labrador (61%), but even there, 39% are not aware of the public debt situation. Awareness levels are much lower in Atlantic Canada more generally (19%), and drop even further in other provinces, including Ontario (11%) and British Columbia (10%).
Interestingly, while eight in ten (81%) of Newfoundland and Labrador residents correctly identified their own provincial government as having the most debt per capita, Ontarians were next most likely to point to their own province (71%) as having the highest debt per capita. When it comes to assessing which province they believe is having the most difficult time economically right now, aggregating Canadians’ top two choices reveals that one in three (32%) believe that Alberta is having the hardest time, followed by 31% who think that Newfoundland and Labrador is having the hardest time economically.
Unlike Alberta, however, “Newfoundland and Labrador’s debt situation is compounded by outmigration, demographic decline, and the federal clawback of equalization. Newfoundland and Labrador isn’t just having a hard time now, but has the deck stacked against it until 2041 due to the unfair deal it signed in 1966 for the Churchill Falls Hydroelectric project,” said Bob Hallett, member of the advisory board of the Schroeder Policy Group. That agreement saw the province agree to sell hydroelectric power to Quebec at below market rates for a total of 75 years, in part to quell the rising nationalist movement in Quebec.
“Add the debt Newfoundland and Labrador has incurred for the new Muskrat Falls hydro project, and economists are predicting the province could face insolvency within a decade,” warned Hallett.
Canadians were asked what the impact on Canada would be if Newfoundland and Labrador were no longer to meet its debt-payment requirements and budget expenditures, and was forced to declare bankruptcy. Three quarters (74%) of Canadians believe the impact on the rest of Canada would be negative, while 21% believe that the negative impact would be minor. Just 5% say there would be no negative impact at all.
In Schroeder’s view, the federal government has not only a financial, but a moral obligation to intervene. “Newfoundland helped keep the country together in the 1960’s – now the country needs to step in to help. Ottawa helped bail out Saskatchewan in 1993. Newfoundland and Labrador deserve the same consideration. Whatever party forms government next week, they need to act on this issue,” said Schroeder.
The Schroeder Policy Group is advocating that the federal government reform the equalization formula so as to stabilize Newfoundland and Labrador’s debt situation until 2041. It makes this case on its website at schroederpolicygroup.ca, where it has published research on the subject by economist Jack Mintz. https://schroederpolicygroup.org/fairness-for-newfoundland-labrador/. Full details of the poll can be consulted on the Ipsos.com website at https://www.ipsos.com/en-ca/news-polls/Only-1-In-10-Canadians-Aware-of-Public-Debt-Situation-in-Newfoundland-Labrador.
About the Schroeder Policy Group
The Schroeder Policy Group is committed to providing informed and credible, non-partisan policy recommendations on some of the biggest challenges facing the country. Founded by Walter Schroeder, it seeks to bring together some of the best economists and experts in Canada, to ensure that in this election, our political leaders are asked the right questions. It is a third party registered with Elections Canada in the 2019 federal election.
About this study
These are some of the findings of an Ipsos poll conducted between October 8th to 15th, 2019, on behalf of the Schroeder Institute. For this survey, a sample of 2000 Canadians aged 18+ was interviewed. Weighting was then employed to balance demographics to ensure that the sample’s composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ± 2.5 percentage points, 19 times out of 20, had all Canadians aged 18+ been polled. The credibility interval will be wider among subsets of the population. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error.
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SOURCE Schroeder Policy Group
For further information: please contact: Bob Hallett, (709) 351-3385; For more information on this research, please contact: Sean Simpson, Vice President, Ipsos Public Affairs, +1 416 324-2002, firstname.lastname@example.org