PQ says it inherited fiscal ‘surprises’ from CAQ

Quebec Premier Paul St-Pierre Plamondon said Wednesday his Parti Québécois government is working with “surprises” in the public finances left by the previous Coalition Avenir Québec government, but that it still intends to keep its campaign promises.

Speaking to reporters in Quebec City before entering the Executive Council offices, St-Pierre Plamondon did not give an estimate of the size of the deficit or say how the projections are worse than expected, Radio-Canada reported. He said his government is going through figures that are “not as clear as all that” about the future the CAQ had presented (translated from French).

The premier wrote on social media Tuesday night, after meeting Finance Minister Nicolas Marceau, that Quebec faces “a significant budget deficit” and that “courageous decisions” will be needed to reduce it (translated from French). He said the previous government left the house “in disorder.”

Le Devoir reported that Marceau told reporters the state of public finances “is not good.” The newspaper’s headline said the minister no longer promises a balanced budget in 2029 and that he pointed to the CAQ and Ottawa. Le Devoir also reported that the government sees a “serious clean-up” ahead in the Quebec infrastructure plan.

The numbers on the record show how much room there is for disagreement. A pre-election report on Quebec’s public finances, released Aug. 17 just before the campaign began, forecast an accounting deficit of $5.2 billion, or 0.8 per cent of GDP, for 2026-27. That was $1.1 billion better than the $6.3 billion accounting deficit estimated in the March budget. The budget put the total deficit at $8.6 billion once the legally required payment to the Generations Fund was included.

CAQ ministers had argued the opposite on Oct. 14, in their last cabinet meeting after losing the election. Deputy Premier Ian Lafrenière said the government was leaving the house “in a better state than before,” and outgoing Finance Minister Eric Girard said Quebec had the second- or third-smallest deficit in Canada (translated from French). Girard also noted the CAQ inherited an $8-billion surplus from the Liberals in 2018 and then had to manage a pandemic.

The PQ campaigned on a return to a balanced budget in 2028-29, a year earlier than the Balanced Budget Act requires. It plans to get there through cuts to the bureaucracy and slower growth in the public-sector payroll.

Its pledges could also cost the treasury. For its first 100 days, the PQ promised to remove the provincial sales tax on used goods and to cut the gas tax by the equivalent of seven cents a litre. Its financial framework also includes a 20 per cent cut to small-business taxes and several tax credits. The government has already released $28 million in emergency homelessness funding, part of a promised $1 billion over four years, and has pledged $100 million to fight food insecurity.

The new government was sworn in this month, as our earlier report on the PQ cabinet showed. Ottawa’s own books are in focus too: the federal budget lands Thursday, and the Parliamentary Budget Officer expects deeper deficits. Federal Finance Minister François-Philippe Champagne has said the budget is about building.

Marceau’s first budget will be the first test of which promises survive.

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