Commentary
In response to the pandemic, governments in Canada launched an unprecedented wave of spending. In Ottawa, the federal government has sought to make that wave permanent.
In 2020/21, federal spending increased by 73 percent to $644.2 billion before declining 21 percent to an estimated $508 billion in 2021/22. Total provincial government spending rose 9.2 percent in 2020/21 to an expected $504.4 billion, and a further 5.6 percent to $532.9 billion in 2021/22.
As a result, between 2019/20 and 2020/21, the federal deficit-to-GDP ratio (an indicator of a jurisdiction’s ability to pay its debt) went from -1.8 percent to -13.2 percent, while the collective deficit-to-GDP ratio of the provinces went from -0.8 percent to -1.9 percent. Consequently, the federal net debt-to-GDP ratio rose from 33 percent in 2018/19 to reach nearly 50 percent by 2021/22, while the collective provincial ratio went from 29 percent to approximately 31 percent….
RSS Feed The Epoch Times