Growth in civil service could ‘blow a big hole’ in provincial budget

The size of the provincial civil service has been growing rapidly in recent years, and the Canadian Taxpayers Federation says it has to stop.

The PEI job market has recovered well beyond where it was the year before the pandemic crash in 2020, and growth in the size of the provincial civil service has been a big part of that.

According to Statistics Canada, from January to August this year the PEI economy averaged 84,600 jobs, 5,800 more than in the same months in 2019. About one quarter of those new jobs are in the provincial civil service. The civil service averaged about 3,300 jobs in the first eight months of 2019, and almost 4,500 in the same period this year, an increase of 36 per cent.

“That’s a huge increase, and that’s really going to blow a big hole in the budgets of both the province and the City of Charlottetown,” said Jay Goldberg, interim Atlantic director of the Canadian Taxpayers Federation.

“Certainly at a time when we’re facing inflation and a cost of living crunch now is not the time for higher taxes, and that’s exactly what’s going to happen if we continue in this direction. We have to pull back and we have to make sure things are fiscally responsible.”

Cycle turns to steady growth

Civil service jobs on the Island follow a pattern familiar to Islanders, with large numbers of seasonal jobs being added in the middle of the year.

This pattern was exaggerated in 2020, when the province launched a number of pandemic support programs in the spring and hired people to run them.

The provincial civil service, which peaked at about 3,800 jobs in July of 2019, swelled to more than 4,700 in the summer of 2020.

As usual, numbers began to fall off in the autumn, but the pattern changed in 2021. Numbers began to grow in the spring and didn’t stop. There has been some up and down, but the number of civil servants has been on an upward trend since April of 2021, reaching a new high of 4,833 in August, the latest month for which figures are available.

In an emailed statement to CBC News, the provincial government noted that PEI is the fastest growing province in Canada, and the government has to grow to serve that population. The province noted that growth is not always going to be a 1:1 relationship.

“It would not be accurate to compare the civil service as an exact representation of the population when it comes to growth, as employees often have numerous files supporting a variety of different groups, clients and Islanders,” the statement said.

“Conversely, it may take several employees working collaboratively on one file for one individual, and so on. Individual departments are responsible to ensure that their respective organizations are staffed efficiently.”

The Taxpayers Federation is also expressing alarm about the increase in spending on salaries.

Figures are not yet available for the most recent budget year, but spending on salaries rose 25 per cent from 2017 to 2021.

The proportion of government expenditures that are on salaries did, however, fall during that same period. In the 2016-17 budget year salaries accounted for 42.8 per cent of provincial spending. It has fallen every year since, and in 2020-21 it accounted for 38.3 per cent of spending.

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