2015-16 WILL SHOW A DEFICIT: THE ONLY QUESTION IS HOW BIG?

The federal government posted a deficit of $9.4 in March 2016, compared to a deficit of $3.0 billion in March 2015.  The increase in the year-over-year deficit was primarily due to lower budgetary revenues (down $5.0 billion), reflecting the timing of receipts. As a result, there was a deficit of $2.0 billion for the April 2015 to March 2016 period, compared to a surplus of $2.9 billion in the same period in 2014-15.

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THE FINAL BUDGET OUTCOME FOR 2015-16 IS STLL UNCERTAIN

The federal government posted a surplus of $3.2 in February 2016, compared to a surplus of $4.6 billion in February 2015.  As a result, there was a surplus of $7.5 billion for the first eleven months of 2015-16, compared to a surplus of $5.9 billion in the same period in 2014-15.

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FEDERAL SUPPORT FOR INNOVATION; A SUGGESTION

Canada is suffering from an innovation deficit, which has been worsening for years. The result has been a dramatic decline in productivity growth and the economic growth potential of the economy. For decades, we have been living off unsustainably high commodity prices, particularly for oil and gas, at the expense of innovation and global competitiveness.

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COMPARING FISCAL APPLES TO FISCAL ORANGES

Did the Liberals inherit a small surplus (less than $1 billion) in 2015-16 as recently forecast by the Parliamentary Budget Officer (PBO) or a deficit of $5.4 billion as forecast by the Finance Minister in his 2016 Budget?. That depends on how one interprets the final outcome, which will not be known until the official Public Accounts numbers are released the fall.

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LESSONS FOR THE 2017 BUDGET

It has been almost a month since the government’s budget. Traditionally, a first budget is a political document that focuses on fulfilling election promises. Given the political nature of a first budget, the Prime Minister’s Office is quite naturally very involved in its preparation. The objective is to get the budget over with and off the front pages quickly.  Unfortunately, for the Prime Minister and the Minister of Finance, their first budget is still in the news and not in a favourable way.

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Fiscal Monitor for April 2015– January 2016

The federal government posted a surplus of $1.1 in January 2016, compared to a surplus of $2.2 billion in January 2016.  As a result, there was a surplus of $4.3 billion for the first ten months of 2015-16, compared to a surplus of $1.3 billion in the same period in 2014-15.

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