OTTAWA - A report from a major Canadian bank says the way we measure economic growth masks the cost of severe weather events and the need for major new infrastructure spending.
TD Economics says natural catastrophes could cost Canadians $5 billion per year by 2020 as more frequent severe weather combines with an increasingly urban population.
The federal government has been working on a national mitigation strategy for natural disasters for more than five years, but funding has been slow to materialize.
Craig Alexander, TD Bank Group's chief economist, says there is an existing infrastructure deficit in Canada that is being made worse by severe weather, population growth and socio-economic changes.
The future payoff on infrastructure spending is enormous, but governments are able to ignore the cost of weather catastrophes because the economic impact is poorly measured.
Alexander calls it a "perverse situation" that the fallout from last summer's devastating floods in Calgary meant TD Bank had to actually revise upwards its GDP growth forecast for Alberta's economy.