Deputy Prime Minister Chrystia Freeland said Friday she will present the government’s fall economic statement on Nov. 3 — the first chance for Canadians to get a closer look at Ottawa’s books since the spring budget.
The statement comes during a time of rising interest rates and considerable economic uncertainty.
Finance Canada said the statement — which includes a look at the expected deficit and national debt for the coming year as well as details about new planned federal programs — will “provide information on the state of the Canadian economy within a challenging global environment and outline the government’s plan to continue building an economy that works for everyone.”
Freeland has toured the country warning Canadians that the coming months could get ugly as the Bank of Canada’s rate hikes work their way through the economy, pushing up the cost of borrowing for individuals and businesses.
But there are early signals that Ottawa’s fiscal health could be much better than previously thought, thanks to higher oil prices and a growth in personal and corporate taxes in this era of high inflation.
According to figures released Thursday through the Public Accounts of Canada, the government’s fiscal ledger, the budget deficit for the 2021-22 fiscal year came in at $90.2 billion — substantially less than the $113.8-billion deficit Freeland projected in her April budget.
Risk of ‘more severe global slowdown’
In an economic and fiscal outlook published earlier this month, the Parliamentary Budget Officer (PBO) forecast a budget deficit of $25.8 billion — or 0.9 per cent of GDP — for the 2022-23 fiscal year if the government pursues “status quo policy,” which means no major new spending on programs. That is significantly smaller than the April budget’s forecast of $52.8 billion.
But Yves Giroux, the PBO, said the central bank’s rate hikes to tame inflation risk dumping Canada into a recession.
“With the synchronized tightening of monetary policy by major central banks around the world to reduce high inflation, there is a risk of a more severe global slowdown, which would negatively affect the Canadian economy and federal finances,” Giroux said.
“We expect growth in the Canadian economy to slow considerably in the second half of 2022 as consumer spending downshifts and residential investment continues to decline. We project real GDP growth to remain weak through 2023 before rebounding somewhat in 2024,” he said.
OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.
However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.
The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.
Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.
The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.
The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.
This report by The Canadian Press was first published Oct. 17, 2024.
OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.
In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.
The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.
Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.
In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.
It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.
This report by The Canadian Press was first published Oct 16, 2024.
