Statistics Canada - Statistique Canada

Government finances and generational equity


"Generational equity" is a topic that has gradually risen higher and higher on the agenda of governments at all levels. In fact, it is a matter not just for government policy, but a topic that touches many Canadians directly: young and old, parents and grandparents. Canadian policy makers increasingly have to deal with issues associated with the relative status of individuals between successive generations. The reform of public pension programs presents the most obvious example, but there are many other developments that raise the same type of issue. Indeed, the heightened concern over government fiscal policies is due in large part to the readiness of many to view government deficits and debt as a burden on future generations. Generational equity, however, is also a concern of individual Canadians and their families. The allocation of resources between the young and the old within the family is becoming an increasingly important issue for many, especially in light not only of an aging population but also the belief that those just entering the labour force will likely not attain the standard of living to which their parents have become accustomed.

The contributors to this book examine the operation of government taxes and expenditures from a generational perspective. In part the motivation for bringing these essays together is to offer comprehensive and up-to-date information on the age incidence of government finances. This motivation, however, also has to do with the development of a new accounting framework, Generational Accounting, that has gained some currency in many industrialized countries, particularly in the United States. It is a truism to say that good analysis requires good data, and certainly Statistic Canada's central role is to offer high-quality data in support of analysis and decision making. But the opposite is equally true, if not as obvious: good data requires good analysis. That is to say, new analytical frameworks often highlight the need to organize existing data in different ways, as well as the need for the development of new types of data. This is certainly one of several reasons that Statistics Canada has sought to develop a strong analytical capacity, and to maintain strong ties with the research community. This book is meant to contribute to this process by examining Canadian data through the lens of Generational Accounting, and by analyzing some of the issues that arise.

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