The City of Toronto gets a failing grade in fiscal accountability, according to a new report that criticizes officials for not providing an accurate picture of the city's finances.
A report released Thursday by the C.D. Howe Institute found that over a 10-year period, the spending changes announced in city budgets didn't match the actual financial reports, "being products of completely different accounting methods."
Also, the anticipated increases and decreases are different from what happens during the year. In 2009, for example, the city budgeted for increased spending of 7.6 per cent, but spending went up 4.3 per cent, the report found. And while revenue was expected to increase 10.4 per cent, it went up 6.6 per cent that year.
The organization made a number of recommendations, including asking the city to be transparent and provide analysis of the discrepancies between its plans and its final results.
"Councillors and Toronto's citizens alike should insist that the city government adhere more closely to the budgets council votes every year, so that the deviations revealed in the reconciliation between the consolidated budget and the audited financial statements become smaller, and justifications for the discrepancies that inevitably occur become more transparent," the report stated.
But budget chief Shelley Carroll insisted that the C.D. Howe Institute was wrong in its analysis, because the city's net numbers are stable.
She said that combining and grossing the numbers to make a point, as C.D. Howe had done, is "disingenuous." She said the city has found efficiencies worth more than $500-million over four budgets, and that's not noted in the C.D. Howe report.
"I understand when someone who isn't immersed in accounting on a day-to-day basis doesn't understand the difference between gross and net and funding sources. But when it comes from an organization like the C.D. Howe, it starts to sound non-objective and extremely partisan," she said.