Think tank gives Hamilton bad grade on budget process

Report says city takes too long to approve document and has transparency issues

As the City of Hamilton’s 2023 budget goes to a vote on March 29, the city has received a D-plus grade for its budget processes and financial transparency in 2022.

And, as it happens, a late-March vote is a no-no if a city wants a good grade.

Toronto-based think tank C.D. Howe Institute put Hamilton near the bottom of a ranking of 32 major Canadian municipalities in a study released Monday — matching the grades of Kitchener, London and Durham Region.

Hamilton’s budget grade was reflective of “multiple problems with transparency, reliability and timeliness,” according to the report.

C.D. Howe Institute CEO Bill Robson told The Spectator one of the major issues with the city’s budget process was the timeliness in which it was approved, while noting there is no official due date for budgets.

Last year’s budget was endorsed on March 30, making it the second last municipality to approve its budget out of those included in the study.

Some nearby communities, such as Kitchener and Niagara Region, had their budgets endorsed as early as December.

Robson said across Canada, municipal councillors tend to feel “disempowered” by the budget process, noting that they often are presented with numbers they don’t entirely understand.

“A lot of this is down to councils,” said Robson, who co-authored the report. “They don’t feel as comfortable as they should in insisting on getting numbers they can understand in time.”

Another issue Robson pointed to in Hamilton was the presentation of budget numbers in the city’s financial statements that did not match those in the budget.

Those variances were also not explained by the city, Robson noted.

“It’s very hard for anybody — whether a councillor or a voter — to look at these results,” he said. “There is nothing that is consistent with the financial statements.”

The annual study, which evaluates the “transparency and quality” of both budgets and financial statements, was conducted by the non-profit organization.

The scores are not a mark for the city’s financial position, but instead are hinged on how easily regular folks can understand crucial figures in the city’s accounting documents.

Other nearby municipalities fared better, with Halton, Toronto, Niagara and Oakville all receiving Cs. Peel Region, Mississauga and Vaughan all earned Bs, while Markham was the only city in Ontario to earn an A.

Robson said Hamilton could improve its score by approving its budget earlier, ensuring numbers in the budget are consistent with public sector accounting standards and explaining variances that do occur.

“I think Hamilton could raise its game,” said Robson.

“Most people ought to be able to understand these documents just as you would understand your household budget.”