(Ottawa) Change of government, change of estimates: Ottawa provides not a surplus but a deficit for the next four years, announced the Ministry of Finance in his economic update last Friday. And those details do not take into account any Liberal promise.
The Harper government announced in its last budget a positive balance from 2015. But “the economic and fiscal outlook of the federal government […] have deteriorated since the previous government tabled the budget in April 2015” it said in the documents of the Ministry.
Thus, the surplus of $ 2.4 billion for the current year (2015-16) will turn into a deficit rather 3,000,000,000. This deficit would increase to 4 billion the following year (2016-17) and résorberait do that in four years, in 2019-20, with a return to a slight cushion of $ 1.7 billion.
This adjustment amounts to about $ 6 billion per year than forecast in the last budget. In total, a surplus of 13.3 billion over four years is thus transformed into 10.7 billion deficit.
“These budget projections are those inherited by the current government. They do not take into account the measures adopted by the current government, “says the update.
Indeed, these predictions do not take into account the many election promises made by the Liberal Party of Canada, whose expensive investments in infrastructure and employment insurance. In the countryside, the troops of Justin Trudeau have already announced a deficit of 25 billion over three years and a return to black ink by 2019-20.
“Despite the weak economic and fiscal outlook, the Minister reiterated his commitment to balance the budget in 2019-2020 and maintain the debt-to-GDP ratio on a downward path throughout its mandate”, can we read the press release of the Ministry.
Finance Minister Bill Morneau, should a news briefing Friday morning in Ottawa.
His ministry explains the situation by factors such as oil prices fall and raw materials, the volatility of the global economy and a downward revision of nominal GDP by 46 billion annually to reflect these risks.
Private sector economists now expect growth of gross domestic product (GDP) of 1.9% per year on average from 2015 to 2019, were 0.2% lower than what was forecast in the last budget.
“The evolution of the economic situation led to a downward adjustment in the fiscal outlook,” says one in the update.