Prime Minister Justin Trudeau sits beside Deputy Prime Minister Chrystia Freeland before speaking to members of caucus on Parliament Hill in Ottawa, Thursday, January 23, 2020. Parliament’s spending watchdog says the federal response to the COVID-19 pandemic should send the deficit to $363.4 billion. THE CANADIAN PRESS/Adrian Wyld

Prime Minister Justin Trudeau sits beside Deputy Prime Minister Chrystia Freeland before speaking to members of caucus on Parliament Hill in Ottawa, Thursday, January 23, 2020. Parliament’s spending watchdog says the federal response to the COVID-19 pandemic should send the deficit to $363.4 billion. THE CANADIAN PRESS/Adrian Wyld

PBO sees $363 billion deficit, warns of pitfalls from Liberals’ promised stimulus

With the economy doing better than expected, and the deficit falling over time

Parliament’s spending watchdog says the federal response to the COVID-19 pandemic should send the deficit to $363.4 billion.

In a report this morning, budget officer Yves Giroux says the deficit should fall over time as emergency spending measures wind down over the next 12 months.

The economy too is faring better than Giroux anticipated, and his office has revised its projections for economic growth starting in the second half of this year.

With the economy doing better than expected, and the deficit falling over time, the budget office expects federal finances to become sustainable again.

The economy could also get a boost from the Liberals’ promised fiscal stimulus that is valued between $70 billion and $100 billion over three years to be outlined in this year’s federal budget.

Giroux’s outlook doesn’t account for that spending because of the lack of detail about how it will be used, but he does warn it would result in larger deficits that may spin out of control depending on how the spending is financed.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Want to support local journalism? Make a donation here.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

A woman wears a protective face covering to help prevent the spread of COVID-19 as she walks past the emergency entrance of Vancouver General Hospital in Vancouver, B.C., Friday, April 9, 2021. THE CANADIAN PRESS/Jonathan Hayward
54 more cases of COVID-19 in Interior Health

Thirty-two people in the region are in hospital with the virus, 11 of them in intensive care

Dr. Katherine Oldfield is a naturopathic physician, mother, and active member of the Nelson-West Kootenay chapter of Citizens’ Climate Lobby. Photo: Submitted
COLUMN: Restore our Earth, restore our health

Katherine Oldfield writes about the priorities we need to have ahead of Earth Day

Air Canada will not be resuming flight to Castlegar anytime soon. Photo: Betsy Kline
Service to West Kootenay Regional Airport not included in Air Canada deal announcement

Air Canada will not be resuming flights to Castlegar at this time

While pharmacies across B.C. are using AstraZeneca for public immunizations for people 40 years of age and older, there is no availability currently in the Kootenays. (AP Photo/Frank Augstein)
No AstraZeneca vaccine availability in Kootenay pharmacies, says Interior Health

Vaccine has been opened up at pharmacies in other areas of the province to people 40 years of age and older

Idle Eyes, Tad Campbell (middle). Photo: Idle Eyes Facebook page
Idle Eyes frontman, Trail native, sentenced to house arrest

Campbell avoided jail time at the Feb. 5 sentencing in the Vancouver courthouse.

Four homes in Johnson Flats were at serious risk of falling into a neighbourhood section of the Kettle River, according to capital project manager Justin Dinsdale. Photo: Laurie Tritschler
Grand Forks shields riverside homes against erosion

Crews have built a modified dike along a section of the Kettle River in Johnson Flats

FILE – The Instagram app is shown on an iPhone in Toronto on Monday, March 19, 2018. THE CANADIAN PRESS/Graeme Roy
Judge acquits B.C. teen boy ‘set up’ on sex assault charge based on Instagram messages

The girl and her friends did not have ‘good intentions’ towards the accused, judge says

Kai Palkeinen recently helped a car stuck on the riverbed near the Big Eddy Bridge. While the car could not be saved, some of the driver’s belongings were. It’s common for vehicles to get stuck in the area due to significantly changing river levels from Revelstoke Dam. (Photo by Kai Palkeinen)
“I just sank a car’: Revelstoke resident wants Columbia River better protected

Although it’s not permitted, the riverbed near the city is popular for off roading

Meng Wanzhou, chief financial officer of Huawei, walks down the street with an acquaintance after leaving B.C. Supreme Court during a lunch break at her extradition hearing, in Vancouver, B.C., Thursday, April 1, 2021. A judge is scheduled to release her decision today on a request to delay the final leg of hearings in Meng Wanzhou’s extradition case. THE CANADIAN PRESS/Rich Lam
B.C. judge grants Meng Wanzhou’s request to delay extradition hearings

Lawyers for Canada’s attorney general had argued there is no justification to delay proceedings in the case

B.C. Premier John Horgan announces travel restrictions between the province’s regional health authorities at the legislature, April 19, 2021. (B.C. government photo)
B.C. sees 862 more COVID-19 cases Wednesday, seven deaths

Recreational travel restrictions set to begin Friday

B.C. Finance Minister Selina Robinson is photographed following her budget speech in the legislative assembly at the provincial legislature in Victoria, Tuesday, April 20, 2021. THE CANADIAN PRESS/Chad Hipolito
B.C. budget lacks innovative drive, vision during uncertain times, say experts

Finance Minister Selina Robinson’s budget sets out to spend $8.7 billion over three years on infrastructure

Using panels kept cold by water circulating within them, B.C. researchers compared thermal comfort in 60 of the world’s most populous cities, including Toronto. (Lea Ruefenacht)
B.C. researchers use air conditioning to combat spread of COVID particles

Dr. Adam Rysanek and his team have proven a new worthwhile system – a mixture of cooling panels and natural ventilation

Police road checks are coming for people travelling between regions while COVID-19 travel restrictions are in place. (Black Press file photo)
B.C. clarifies COVID-19 travel restrictions, Lower Mainland a single zone

Vehicle checks on highways, at ferry terminals to start Friday

Canadian driver Paul Tracy pulls out of the pits during the morning session at the Molson Indy in Vancouver, B.C., Saturday, July 26, 2003 (CP/Richard Lam)
Vancouver is considering hosting a Formula E race using electric cars

The race would be part of a three-day event focused on climate and sustainability

Most Read