Media Clipping —Thursday, July 19, 2001, The Daily News, Halifax — MONEY

Why good times are bad news for most in N.S.

By John McLeod

ECONOMIC GROWTH, commonly measured by the gross domestic product (GDP), is often assumed to benefit most of us, at least to some degree. But a report released yesterday by the Halifax-based non-profit research group GPI Atlantic comes to a startling, and opposite, conclusion.

"A growing economy," think-tank director Ronald Colman says, has left 80 per cent of Nova Scotians worse off than they were in 1980, and the income gap between rich and poor wider than at any time in the last 20 years."

The report, simply called Income Distribution in Nova Scotia, used Statistics Canada data. Income distribution, Colman explains, is one of the 22 components in a new index of well-being called the Genuine Progress Index, which is being developed in Nova Scotia as a pilot project for Canada.

Some examples:
- The income gap between the richest provinces (Ontario and Alberta) and the rest of the country grew in the 1990s. Nova Scotians had 82 cents of disposable income for every $1 held by Ontarians in 1990. In 1998 that had fallen to 73 cents. The average Nova Scotian's disposable income dropped $3,000, or eight per cent, during that decade, while Ontarians saw an increase of $1,800 or four per cent, and Albertans' disposable income grew by $2,100, or five per cent.

- Middle-income Nova Scotians since 1990 have lost the most in absolute terms (average $3,600) and the poor have lost the most in percentage terms (29 per cent of disposable income). The poorest 20 per cent of Nova Scotian households are the poorest in the country," the study reports, and the poorest 40 per cent of Nova Scotian households have lost more income in both absolute and percentage terms since 1990 than the bottom 40 per cent in any other province."

- Inequality among Nova Scotians has grown sharply, according to Colman's analysis. In 1990, the richest 20 per cent of Nova Scotia households had an average disposable income 6.2 times greater than the poorest 20 per cent. By 1998 the income of the rich was 8.5 times higher. The richest 20 per cent of Nova Scotian households average $70,000 a year in disposable income (after taxes), compared to $8,205 for the poorest 20 per cent," the report notes.

- Government cash transfers (EI, CPP, child tax benefits) to middle-income groups in the province have increased by 73 per cent since 1990, while transfer payments to the poorest households have fallen by 15 per cent.

Clearly GPI Atlantic paints a much different picture of our economic situation than is done through tradition measures.

And a pretty picture, it's not.

Copyright © 2001, The Daily News