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Lots of fat left to cut at Calgary city hall

June 22, 2019
Lots of fat left to cut at Calgary city hall

Instead of trying to figure out who to tax more, Calgary city councillors need to find ways to spend less.

While the city has suggested there is a $250-million revenue hole, it has stayed quiet about the $400 million in extra spending that has occurred since 2014. These increases are following years of overspending. Had the city merely increased expenses at a slower rate – equal to inflation plus population growth – spending would have been over $4 billion less between 2008 and 2016.

Claims of the city finding savings should be taken with a grain of salt. Mayor Nenshi likes to say that he’s been finding lots of savings at city hall, but while small cuts have been made overall spending is way up.

How can council turn around Calgary’s sinking fiscal ship? Simple: by cutting the fat and lowering spending.

Councillors need to show leadership. That means no more frivolous spending on gifts such as the time Coun. Druh Farrell expensed a $195 Japanese knife as a gift to an employee while giving another employee $243 in gifts.

It’s also time for councillors to lower their own labour costs. Between 2007 and 2016, city council’s pensions cost Calgary taxpayers more than the plans for their counterparts in Edmonton, Vancouver and Ottawa combined. Should Calgary taxpayers really be forced to fund the mayor’s second pension?

Taking leadership will give councillors the credibility to address the real cost-elephant in the room, growing employee labour costs.

If council had frozen the city’s salaries, wages and benefits at 2014 levels, more than $200 million would have been saved. Annual pension costs at the city have exploded by 459 per cent between 2002 and 2017. If these costs merely tripled over that period, the city would now save over $90 million per year.

Even more frustrating than the total cost of compensation is the outlandish city employee perks. More than 200 employees are set to receive three pensions, hundreds more receive two pensions and many employees receive good-bye cheques that average nearly $11,000 each. This is absurd when most working Albertans outside of government don’t even receive a workplace pension!

The growing city labour costs, outrageous perks and the addition of 1,000 full-time employees since 2014 have all been paid for by Calgarians who have been struggling with high unemployment and tough economic times. 

City council needs to focus on growing the economy without relying on taxpayer handouts. After hundreds of Calgarians rallied at city hall to protest higher business property taxes, councillors should have immediately scrapped their $100 million corporate welfare fund. Imagine being a small business owner looking at your tax bill and knowing some of your money is going to new competitors.

Councillors need to stop chasing costly and non-essential projects. Instead of wasting time and resources on the Olympic bid boondoggle, council could have been working to lower property tax bills. After years of kicking the can down the road, council has made little ground towards finding a long-term solution to the property tax debacle, but it’s still pursuing four non-essential big capital projects.

There’s no reason taxes have to keep going up. The Alberta government and City of Chestermere are showing tax cuts are possible. But to make tax relief a reality, Calgarians need to keep signing petitions, attending rallies and speaking up at public hearings to make council cut the fat. Someday council will get the message.

This column was originally published in the Calgary Sun on June 22, 2019. 

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