Just a few quick points in response to several emails I received on my latest G&M post. First, here is the full table of all CMA and CA areas for the reliance on government transfer income and average income tax contribution.
I also want to say that I am not drawing any conclusions here about the government transfer income per se. All government transfer income – CPP, OAS, EI, workers’ comp, social assitance, child tax credits, etc. is there for a reason. That debate is for another day. I am just saying that the ratio between employment income and government transfer income matters. The national average is 18 cents worth of government transfer income per $1.00 of employment income. As is shown in the chart, there are now many communities in the 25, 30 and up to 72 cents range (Elliot Lake).
I think most people would agree there is some threshold where this ratio starts to become a problem. Is it 20 cents? 30 cents 40 cents? All I am saying is that we are there already with a number of communities and those same communities – for the most part – also contribute well below average income tax revenues. That was my definition of a ‘have not’ community – well above average reliance on government transfer income and well below contribution to income taxes.
To those who think the analysis was ‘high level’ – I agree. These columns are a place to discussion issues and trends – not to fully exhaust a large scale public policy issue.
I think this type of analysis is needed and should be part of our debate.