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 screenshot taken from the Parksville city council meeting on Monday, April 19, where members of the Friends of the Parksville Community Centre presented the results of an ongoing online petition. Parksville city council is shown top left, David Todtman is shown top right, and Valerie Dare is shown at the bottom. (Via Youtube)
Friends of the Parksville Community Centre members present online petition to city council

Nearly 2,600 signatures collected in bid to keep facility as community gathering place

The scene of a single-vehicle crash along Dolphin Drive in Nanoose Bay on Monday morning, April 19. (Mandy Moraes photo)
RCMP: No injuries reported in rollover crash in Nanoose Bay

Police say passengers indicate driver left the scene

The Town of Qualicum Beach plans to establish temporary shelters. (Town of Qualicum Beach illustration)
Town of Qualicum Beach seeks $1.25M grant to build temporary housing units

Aim is to move tenants in prior to the end of 2021

Mount Arrowsmith Teachers’ Association and its Nanaimo-Ladysmith counterpart seek stricter COVID-19 rules. (PQB News file photo)
Mount Arrowsmith teachers’ union asks health authority for stricter COVID-19 measures

Teachers ask for vaccine, more online learning, mask mandate for primary students

A large crowd protested against COVID-19 measures at Sunset Beach in Vancouver on Tuesday, April 20, 2021. (Snapchat)
VIDEO: Large, police-patrolled crowds gather at Vancouver beach for COVID protests

Vancouver police said they patrolled the area and monitored all gatherings

Aria Pendak Jefferson cuddles ChiChi, the family cat that ran away two years ago in Ucluelet. The feline was missing until Courtney Johnson and Barry Edge discovered her in the parking lot of the Canadian Princess earlier this month. Aria and her parents were reunited with ChiChi in a parking lot in Port Alberni. (SUSAN QUINN/ Alberni Valley News)
An Island girl’s wish is answered as her cat came back

Courtenay family reunited with cat that went missing in Ucluelet in 2019

Vancouver Island Connector and Tofino Bus is putting a 41-passenger electric bus through its paces in a three-month trial run between Nanaimo and Victoria. (Photo submitted)
Electric bus on trial run serving Victoria-to-Nanaimo route

Vancouver Island Connector and Tofino Bus trying out 41-seat electric coach for three months

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 tries to save vehicle from the Columbia River

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

Most Read