Enjoy the good life, but fear for the future of the sewage system

WITH glistening office towers rising between broad beaches and forested mountains, big parks and waterfront residences, Vancouver often comes at the top of lists of the world's best cities in which to live. This week, amid much triumphalism from civic leaders, Vancouver is celebrating the 125th anniversary of the moment when a scruffy wooden lumber camp burned to the ground, and the foundations of what is now western Canada's largest city were laid. But for all its picture-postcard image, Vancouver, like other Canadian cities, faces some pressing problems and lacks the means to deal with them.

Those headaches include Downtown Eastside, a ghetto of crime, poverty and drug addiction that is the country's sickest urban area. Soaring house prices intermingle with homelessness. The middle class is being squeezed out to the suburbs. Although the city has lost corporate head offices to Calgary, in oil-rich Alberta, the population of Greater Vancouver is set to rise from 2m to 3.4m by 2041, according to the planners. The city faces a steep bill to expand public transport, upgrade sewers and water systems and repair crumbling civic buildings, roads and bridges.

Vancouver's difficulties are mirrored across the country. Provincial governments have neglected their responsibility for such matters as social housing, welfare, mental illness, drug addiction and policing. All told, Canada's big cities need at least C$238 billion ($243 billion) to repair and expand infrastructure, according to the Federation of Canadian Municipalities. But municipal governments lack both money and powers. They get only eight cents out of every tax dollar. Their revenues come mainly from property taxes. Under constitutional arrangements that date back to the time when Canada was largely rural, mayors have fewer powers than their counterparts in some other developed countries.

The result is that mayors must constantly go cap-in-hand to the provincial and federal governments for money for capital projects. The response has been an array of ad hoc funding for urban schemes. For example, such arrangements gave Vancouver a new convention centre, sports facilities and a fast rail link to the airport, all built for the 2010 winter Olympic games. But municipal leaders across the country want more stable and predictable finances. They have lobbied the federal government to make permanent C$2 billion in annual funding programmes for roads, housing and police set to expire in 2014. In its budget this week the government promised to do so.

Businessmen are starting to worry about urban neglect. The Toronto Board of Trade, a business lobby, recently criticised traffic congestion in the city; it is backing a C$50 billion plan to expand roads and public transport in the Toronto-Hamilton conurbation over the next 25 years.

If federal politicians have hitherto largely ignored this festering urban problem, that may be in part because rural areas continue to be over-represented in the House of Commons. But four out of every five Canadians now live in a city, and most economic activity takes place in them. Unless they receive the public investment they need, Canadian cities will slowly become less desirable places in which to live and work.