November 1, 2012 - MLI research co-ordinator Philip Cross and author Marc Joffe write about the provincial default crisis in op-eds published in the Vancouver Sun, Calgary HeraldSaskatoon's StarPhoenix, and Chronicle Herald!

An excerpt from the Vancouver Sun:

Alberta has the most risk 30 years out, the byproduct of today's youthful population growing old later and its volatile energy resource revenues. Ontario has the second highest risk of insolvency, the result of its failure to address its structural fiscal deficit as its population begins to age rapidly.

British Columbia is in the middle of the pack, with slightly over a 50-per-cent likelihood of default in 30 years. This partly reflects its relatively low level of debt today, with the third lowest ratio of debt to GDP of all the provinces. This helps offset some of the corroding effect on government finances from an aging population. B.C. had a $1.8-billion deficit in the fiscal year ending in 2012, up significantly from the previous year.

An excerpt from the Calgary Herald:

Albertans may be shocked to hear it is most at risk for a return to insolvency a century after its first default. While Alberta has no net debt outstanding today, its fiscal outlook is clouded by three factors. It forecasts a $3-billion deficit in fiscal 2013 despite the growth in energy investment, its youthful population today is projected by Statistics Canada to age more than the other provinces, and the provincial treasury has a large dependence on volatile energy revenues.

An excerpt from The StarPhoenix:

Saskatchewan is one of only two provinces with a less than 50 per cent likelihood of default in the next 30 years. This reflects its very low stock of debt today and that Statistics Canada projects its population will not age as much as most other provinces.

The latter trait it shares with Quebec, the only province with a lower probability of insolvency.

An excerpt from the Chronicle Herald:

Most of the Maritime provinces are around the middle of the pack in terms of their default risk, at slightly over 50 per cent in 30 years. This is less than richer provinces such as Alberta and Ontario. While the three Maritime provinces all currently have above average debt-to-GDP ratios of about 33 per cent, their long-term fiscal outlook benefits from having a population that already is relatively old, which reduces the burden of the population aging more in coming decades, as well as a lower dependence of provincial treasuries on volatile energy revenues.

To read the full op-eds, see below:

"B.C. not alone in facing deficit crisis" by Philip Cross and Marc Joffe, Vancouver Sun, November 1, 2012 (republished in the Leader-Post and

"Alberta faces the greatest risk of insolvency" by Philip Cross and Marc Joffe, Calgary Herald, November 1, 2012 (republished on

"Provinces at risk of debt default" by Philip Cross and Marc Joffe, The StarPhoenix, November 1, 2012

"The provincial default crisis in Atlantic Canada's future" by Philip Cross and Marc Joffe, Chronicle Herald, November 3, 2012


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