| Budget 2025 with Bill Robson: What Canadians Need to Know |
| November, 2025 – Canada does not have a credible fiscal plan. After Ottawa revealed the details of its “sea change” budget, the C.D. Howe Institute’s President and CEO Bill Robson explains why Mark Carney’s first budget in the age of Trump fails to get a passing grade. |
Canada is facing significant budgetary challenges, with projected deficits and increased government spending raising concerns about fiscal sustainability and economic health.
Current Budget Situation
- Projected Deficits: The Canadian federal government is expected to see a deficit of approximately $70 billion for the year, with five-year deficits averaging 1.5% of GDP. This situation is compounded by structural vulnerabilities such as low trend growth and reliance on U.S. trade, which leave Canada exposed to economic challenges. 1
- Parliamentary Budget Officer’s Report: The latest report from the Parliamentary Budget Officer (PBO) indicates that while the deficit for 2024-25 is estimated to be $46 billion, this is $4.3 billion lower than previous predictions. However, the report highlights a lack of clarity in the government’s fiscal planning, raising concerns about the sustainability of spending plans. 1
- Rising Expenditures: In the first two months of the 2025/26 fiscal year, Canada recorded a C$6.50 billion deficit, significantly higher than the previous year’s C$3.82 billion. This increase is attributed to a 4% rise in program expenses across all major spending categories, while revenues have stalled. 1