Higher spending and interest costs drive Canada’s deficit increase, despite revenue growth
The Finance Department reports that Canada's federal deficit reached $13bn between April and September, up from $8.2bn during the same period last year, according to BNN Bloomberg.
The monthly fiscal monitor, released today, highlights an increase in revenues by $20.3bn, or 9.6 percent, compared to the first half of the 2023-24 fiscal year.
Despite this growth, the deficit widened due to rising program expenses and public debt charges.
Program expenses, excluding net actuarial losses and gains, grew by $21.7bn, or 11.2 percent.
The increase reflects higher direct program spending and transfers to individuals and other levels of government.
Public debt charges climbed by $5.2bn, or 22.5 percent, driven primarily by higher interest rates.
Meanwhile, net actuarial losses and gains saw a significant decline, falling by $1.8bn, or 46.8 percent.
The report underscores the fiscal pressures stemming from elevated spending and interest rate impacts, despite improved revenue collection in the first half of the fiscal year.
