Canada’s Parliamentary Budget Officer says the upcoming budget deficit will be $20.2 billion, which contradicts the $18.4 billion Moneybags Morneau listed in the recent fiscal update.
The gap between the PBO and the Trudeau government finance department is almost $2 billion, and comes amid more economic bad news, with rising debt, weak exports, and a contraction in the economy in the last reported month.
Under current projections, the PBO says the long-term budget deficit will end up declining to $9.9 billion, but that won’t happen until 2022-2023. It’s important to note that $9.9 billion is about what Trudeau promised as the yearly deficits in 2016-2017. Of course, that’s what he said when he was campaigning, now it seems he’ll be over half-a-decade late.
According to the Canadian Press, the PBO report “says economic growth will slow over the next few years as consumer spending moderates and residential investment declines with higher borrowing rates and lower gains in disposable income. We project real GDP growth to slow from 3.1 per cent in 2017 to 1.9 per cent in 2018 and then to 1.8 per cent in 2019 before averaging 1.7 per cent annually over 2020 to 2022.”
Keep in mind that economic growth under 2% in a country with an expanding population (mostly due to immigration), means the average person is either getting economically stuck, or even getting poorer on a GDP per-capita basis.
As a result of this weak growth, the PBO says there’s only a 10% chance of a balanced budget by the year 2019/2020, and just a 30% chance by 2022-2023. Far from what Trudeau once promised Canadians.