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Fiscal update reveals extent of federal government mismanagement

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5 minute read

From the Fraser Institute

By Jake Fuss and Grady Munro

Following the sudden departure of Chrystia Freeland as finance minister, the Trudeau government released its 2024 fall fiscal update on Monday. Unsurprisingly, spending is up, the deficit has ballooned even higher, and the Trudeau government continues to utterly mismanage Canada’s finances.

Let’s get into the numbers.

For the current fiscal year (2024-25), the update estimates the federal government will spend $543.4 billion while taking in $495.2 billion in revenues. This means the government plans to run a $48.3 billion deficit—$8.5 billion higher than the $39.8 billion deficit that had originally been planned just eight months ago.

The Trudeau government’s incessant need to introduce new spending at every turn has driven this increase in borrowing. Indeed, discretionary spending on programs is now expected to be $6.1 billion higher than initially projected in this year’s budget tabled in April. Revenues have also taken a hit compared to projections from the spring, primarily from the federal government’s new GST holiday.

Not only will the government run a larger deficit this year, but future deficits are also expected to rise. Cumulative deficits from 2025-26 to 2028-29 are now expected to be $14.9 billion higher than projected in the spring budget.

There are costs associated with running deficits and accumulating debt, and Canadians ultimately bear these costs. Just like anyone who takes out a loan at a bank, government must pay interest on the money it borrows. In the case of the federal government, these interest costs will reach an estimated $53.7 billion in 2024-25 alone—more than all revenue collected via the federal GST. In other words, every dollar that Canadians are expected to pay in GST this year will go towards federal debt interest, as opposed to any services or programs. And as the federal government continues to borrow more, all else equal, these interest costs will continue to rise.

While the updated deficits for 2024-25 and beyond are still estimates, the 2024 FES presents what’s likely the final deficit number for the 2023-24 fiscal year. In a remarkable display of fiscal mismanagement, the Trudeau government ran a $61.9 billion deficit last year—$21.9 billion higher than the $40.0 billion deficit projected in the budget.

This means the federal government has broken one of its fiscal rules (a.k.a. guardrails) that help guide policy on spending, taxes and borrowing. One year ago, the Trudeau government established three fiscal rules—including to keep the 2023-24 deficit at or below $40.1 billion. These rules were reaffirmed in the spring budget, and have been a key feature of the Trudeau government’s so-called “responsible economic plan.”

However, there’s nothing responsible about establishing a rule only to break it a year later. Unfortunately, the Trudeau government has made a habit breaking its self-imposed rules. In 2015, the government established its first fiscal rule—balancing the budget by fiscal year 2019-20. But it quickly abandoned this rule in subsequent months and proposed an alternative rule—to reduce federal debt relative to the size of the economy (GDP). But again, this rule became an afterthought, as federal debt increased relative to GDP in 2019-20 and continued to sharply increase during the pandemic and has yet to return to anywhere near pre-COVID levels.

As has happened consistently in the past decade, this year’s fall update reveals that spending and deficits are up compared to the budget plan the government presented just months ago. The Trudeau government is utterly mismanaging the Canada’s finances, which has caused turmoil inside the government while Canadians bear the consequences.

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Grady Munro

Policy Analyst, Fraser Institute

Business

Canada has given $109 million to Communist China for ‘sustainable development’ since 2015

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From LifeSiteNews

By Anthony Murdoch

A briefing note showed Canadian aid has gone to ‘key foreign policy priorities in China, including human rights, gender equality, sustainable development, and climate change.’

A federal briefing note disclosed that well over $100 million has been provided to the Communist Chinese government in so-called “foreign aid” to promote “sustainable development” that includes woke ideology such as gender equality.

As reported by Blacklock’s Reporter, a recent briefing note titled Assistance to China from May for the Minister of International Development showed $109 million has gone to “key foreign policy priorities in China, including human rights, gender equality, sustainable development, and climate change” since 2015 and $645 million since 2003.

The briefing note asked directly if funding was “going to the Government of China.”

In reply, the briefing note stated, “Canada has not provided direct bilateral assistance to Chinese state authorities since 2013, though it continues to provide small amounts of funding to international partners and non-state partners on the ground.”

Former Prime Minister Justin Trudeau came to power in 2015 and increased relations with the Communist Chinese regime. This trend under the Liberal Party government has continued with Prime Minister Mark Carney.

During a 2025 federal election campaign debate, Conservative Party leader Pierre Poilievre called out Carney for his ties to Communist China.

Conservative MP Andrew Scheer has consistently called out any money at all going to China, saying, “I don’t believe Canadian taxpayers should be sending any money to China.”

“We’re talking about a Communist dictatorial government that abuses human rights, quashes freedoms, violates rights of its citizens, and has a very aggressive foreign policy throughout the region,” he noted.

Scheer added that he has been calling on the Carney Liberals to “stand up for themselves, stand up for Canadians, stop being bullied and pushed around on the world stage, especially by China.”

Other countries have received millions of dollars in foreign aid, with $2.1 billion going to Ukraine, $195 million to Ethiopia, $172 million to Haiti, and $151 million to the West Bank and Gaza last year.

Foreign aid to all nations totaled $12.3 billion.

LifeSiteNews recently reported that the Canadian Liberal government gave millions in aid to Chinese universities.

China has been accused of direct election meddling in Canada, as reported by LifeSiteNews.

LifeSiteNews also reported that a new exposé by investigative journalist Sam Cooper has claimed there is compelling evidence that Carney and Trudeau are/were strongly influenced by an “elite network” of foreign actors, including those with ties to China and the World Economic Forum.

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Canada’s combative trade tactics are backfiring

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This article supplied by Troy Media.

Troy MediaBy Sylvain Charlebois

 

Defiant messaging may play well at home, but abroad it fuels mistrust, higher tariffs and a steady erosion of Canada’s agri-food exports

The real threat to Canadian exporters isn’t U.S. President Donald Trump’s tariffs, it’s Ottawa and Queen’s Park’s reckless diplomacy.

The latest tariff hike, whether triggered by Ontario’s anti-tariff ad campaign or not, is only a symptom. The deeper problem is Canada’s escalating loss of credibility at the trade table. Washington’s move to raise duties from 35 per cent to 45 per cent on nonCUSMA imports (goods not covered under the Canada-United States-Mexico Agreement, the successor to NAFTA) reflects a diplomatic climate that is quickly souring, with very real consequences for Canadian exporters.

Some analysts argue that a 10-point tariff increase is inconsequential. It is not. The issue isn’t just what is being tariffed; it is the tone of the relationship. Canada is increasingly seen as erratic and reactive, negotiating from emotion rather than strategy. That kind of reputation is dangerous when dealing with the U.S., which remains Canada’s most important trade partner by a wide margin.

Ontario Premier Doug Ford’s stand up to America messaging, complete with a nostalgic Ronald Reagan cameo, may have been rooted in genuine conviction. Many Canadians share his instinct to defend the country’s interests with bold language. But in diplomacy, tone often outweighs intent. What plays well domestically can sound defiant abroad, and the consequences are already being felt in boardrooms and warehouses across the country.

Ford’s public criticisms of companies such as Crown Royal, accused of abandoning Ontario, and Stellantis, which recently announced it will shift production of its Jeep Compass from Brampton to Illinois as part of a US$13 billion U.S. investment, may appeal to voters who like to see politicians get tough. But those theatrics reinforce the impression that Canada is hostile to
international investors. At a time when global capital can move freely, that perception is damaging. Collaboration, not confrontation, is what’s needed most to secure investment in Canada’s economy.

Such rhetoric fuels uncertainty on both sides of the border. The results are clear: higher tariffs, weaker investor confidence and American partners quietly pivoting away from Canadian suppliers.

Many Canadian food exporters are already losing U.S. accounts, not because of trade rules but because of eroding trust. Executives in the agri-food sector are beginning to wonder whether Canada can still be counted on as a reliable partner, and some have already shifted contracts southward.

Ford’s political campaigns may win applause locally, but Washington’s retaliatory measures do not distinguish between provinces. They hit all exporters, including Canada’s food manufacturers that rely heavily on the U.S. market, which purchases more than half of Canada’s agri-food exports. That means farmers, processors and transportation companies across the country are caught in the crossfire.

Those who believe the new 45 per cent rate will have little effect are mistaken. Some Canadian importers now face steeper duties than competitors in Vietnam, Laos or even Myanmar. And while tariffs matter, perception matters more. Right now, the optics for Canada’s agri-food sector are poor, and once confidence is lost, it is difficult to regain.

While many Canadians dismiss Trump as unpredictable, the deeper question is what happened to Canada’s once-cohesive Team Canada approach to trade. The agri-food industry depends on stability and predictability. Alienating our largest customer, representing 34 per cent of the global consumer market and millions of Canadian jobs tied to trade, is not just short-sighted, it’s economically reckless.

There is no trade war. What we are witnessing is an American recalibration of domestic fiscal policy with global consequences. Canada must adapt with prudence, not posturing.

The lesson is simple: reckless rhetoric is costing Canada far more than tariffs. It’s time to change course, especially at Queen’s Park.

Dr. Sylvain Charlebois is a Canadian professor and researcher in food distribution and policy. He is senior director of the Agri-Food Analytics Lab at Dalhousie University and co-host of The Food Professor Podcast. He is frequently cited in the media for his insights on food prices, agricultural trends, and the global food supply chain

Troy Media empowers Canadian community news outlets by providing independent, insightful analysis and commentary. Our mission is to support local media in helping Canadians stay informed and engaged by delivering reliable content that strengthens community connections and deepens understanding across the country

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