By Erica Alini - Friday, February 22, 2013 - 0 Comments
The federal deficit was $0.6 bn in December 2012, up slightly from the $0.5 bn recorded in December 2011, the Finance Department revealed today. Still, red ink accumulated since the beginning of the fiscal year, in April, amounted to $13 bn, below the $16.1 registered over the same period in 2011-2012.
Stephen Gordon noted a couple of weeks ago how the monthly deficit data available until then were difficult to square with the government’s estimate of a $26 bn deficit by fiscal year-end. April-to-November spending and revenue patterns, he wrote, would indicate the overall deficit for 2012-2013 will be considerably lower.
Today’s December data show very much the same picture.
By Stephen Gordon - Friday, February 8, 2013 at 1:17 PM - 0 Comments
The last federal budget projected a deficit of $21.1 billion for the fiscal year 2013, an estimate the government revised up to $26 billion in November’s Fiscal Update. But it seems to me as though the actual number is going to come in much lower than that.
Every month, the Department of Finance provides some summary statistics on the flows in and out of the public coffers in the Fiscal Monitor. These data are noisy and have significant seasonal patterns: personal income tax revenues jump in April and expenditures jump in March as managers go on a spend-what’s-left-in-the-budget spree. (They know that the reward for not spending all the money allotted to them in a given year is a budget cut for the next year.) But if you take twelve-month moving sums, you can get get a reasonably good idea of the state of federal finances. In principle, the sum of the twelve months to a given March should be the same as for that fiscal year, though there are always end-of-year adjustments in which certain items are budgeted to the entire year and not to any particular month.
Nonetheless, the monthly numbers are close enough to the fiscal year data to justify keeping track of them:
By The Canadian Press - Friday, December 21, 2012 at 2:56 PM - 0 Comments
OTTAWA – The federal government shrank its deficit for October to $1.7 billion compared…
OTTAWA – The federal government shrank its deficit for October to $1.7 billion compared with a shortfall of $2.1 billion a year ago.
The decrease came as revenue for the month was up eight per cent or $1.6 billion to $20.89 billion, while program spending was up 6.1 per cent or $1.1 billion to $20.03 billion.
Public debt charges were down 1.5 per cent or about $38 million to $2.54 billion. Continue…
By Stephen Gordon - Monday, October 8, 2012 at 12:49 PM - 0 Comments
The Parliamentary Budget Office has been warning that the federal government has been running a “structural deficit” for several years now, and the Conservative government has been dismissing those warnings for just as long. Interestingly, though, the Department of Finance just came up with a new feature for the 2012 edition of the Fiscal Reference Tables, which were made public on Friday: estimates for the “cyclically-adjusted budget balance.” And they look a lot like the PBO’s estimates.
The idea behind the CABB is that governments should aim to run a balanced budget over the course of the business cycle: surpluses in expansions would offset the deficits incurred during recessions. Balancing the budget in every year would mean that governments would be forced to increase taxes and cut spending in downturns, and to do the opposite when the economy is growing quickly.
By Aaron Wherry - Friday, September 4, 2009 at 5:36 PM - 14 Comments
Another of those pesky economists suggests the federal deficit will require some attention at some point. Luckily, Messrs Ignatieff and Harper have a choice of solutions. Unfortunately, “none of the above” is not an option.
Ottawa needs to acknowledge it can not return to surplus as early as it projected, and that tax hikes, even temporary ones, or deep spending cuts need to be incorporated to complete the task, said a report Friday from a leading fiscal forecaster…
Mr. Orr said there are two options available to return to surplus… In the first, Mr. Flaherty could wait for Canada to “grow out” of the deficit, which would not result in a balanced budget until the 2017-18 fiscal year. Mr. Orr cautioned that this option is based on the assumption that Ottawa caps program spending growth at 4%. Since the late 1990s, after the federal government successfully steered the country out of deficit, annual program spending has increased at a rate of between 6% and 8%…
The other option would be to introduce temporary tax increases, such as increasing the GST back to 7%. That would raise the money necessary to get the budget balance back into the black by the original timetable, 2013-14. Mr. Orr said a timetable could be produced under which the GST heads back down to 5%, but would be conditional on the government keeping the books balanced.