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Government debt burden increasing across Canada

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From the Fraser Institute

By Tegan Hill, Jake Fuss and Spencer Gudewill

As governments across Canada unveil their 2025 budgets, outlining their tax and spending plans for the upcoming fiscal year, they have an opportunity to reverse the trend of deficits and increasing debt that has reigned in recent years.

Indeed, budget deficits, which fuel debt accumulation, have become a serious fiscal challenge for the federal and many provincial governments, primarily due to high levels of government spending. Since 2007/08—the final fiscal year before the financial crisis—combined federal and provincial net debt (inflation-adjusted) has nearly doubled from $1.2 trillion to a projected $2.3 trillion in 2024/25. And you can’t blame COVID, as combined federal and provincial net debt (inflation-adjusted) increased by nearly $600 billion between 2007/08 and 2019/20.

Federal and provincial net debt (inflation-adjusted) per person has increased in every province since 2007/08. As shown in the below chart, Newfoundland and Labrador has the highest combined (federal and provincial) debt per person ($68,516) in 2024/25 followed by Quebec ($60,565) and Ontario ($60,456). In contrast, Alberta has the lowest combined debt per person ($41,236) in the country. Combined federal and provincial net debt represents the total provincial net debt, and the federal portion allocated to each of the provinces based on a five-year average (2020-2024) of their population as a share of Canada’s total population.

The combined federal and total provincial debt-to-GDP ratio, an important fiscal indicator that compares debt with the size of the overall economy, is projected to reach 75.2 per cent in 2024/25. By comparison, the ratio was 53.2 per cent in 2007/08. A rising debt-to-GDP ratio indicates government debt has grown at an unsustainable rate (in other words, debt levels are growing faster than the economy). Among the provinces, the combined federal-provincial debt-to-GDP ratio is highest in Nova Scotia (92.0 per cent) and lowest in Alberta (42.2 per cent). Again, the federal debt portion is allocated to provinces based on a five-year average (2020-2024) of their population as a share of Canada’s total population.

Interest payments are a major consequence of debt accumulation. Governments must make interest payments on their debt similar to households that must pay interest on mortgages, vehicles or credit card spending. When taxpayer money goes towards interest payments, there’s less money available for tax cuts or government programs such as health care and education.

Interest on government debt (federal and provincial) costs each Canadian at least $1,930 in 2024/25. The amount, however, varies by province. Combined interest costs per person are highest in Newfoundland and Labrador ($3,453) and lowest in Alberta ($1,930). Similar to net debt, combined federal and provincial interest costs are represented by the total of the provincial and federal portion with the federal portion allocated to each of provinces based on a five-year average (2020-2024) of their population as a share of Canada’s total population.

Debt accumulation comes with consequences for everyday Canadians as more and more taxpayer money flows towards interest payments rather than tax relief or programs and services. This budget season, federal and provincial governments should develop long-term plans to meaningfully address the growing debt problem in Canada.

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DOGE discovered $330M in Small Business loans awarded to children under 11

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In a bombshell revelation at a White House cabinet meeting, Elon Musk announced that the Department of Government Efficiency (DOGE) had uncovered over $330 million in Small Business Administration (SBA) loans issued to children under the age of 11.

Key Details:

  • Elon Musk stated that DOGE found $330 million in SBA loans given to individuals under the age of 11.
  • The youngest recipient was reportedly just nine months old, receiving a $100,000 loan.
  • SBA has now paused the direct loan process for individuals under 18 and over 120 years old.

Diving Deeper:

At a cabinet meeting held Monday at the White House, President Donald Trump and Elon Musk detailed a staggering example of federal waste  uncovered by the newly-formed Department of Government Efficiency. Speaking directly to ongoing efforts to eliminate corruption and abuse in federal agencies, Musk explained that the SBA had awarded hundreds of millions in loans to children—some of whom were still in diapers.

“A case of fraud was with the Small Business Administration, where they were handing out loans — $330 million worth of loans to people under the age of 11,” Musk said. “I think the youngest, Kelly, was a nine-month year old who got a $100,000 loan. That’s a very precocious baby we’re talking about here.”

DOGE’s findings forced the SBA to abruptly change its loan procedures. In a post on X, the department revealed it would now require applicants to include their date of birth and was halting direct loans to those under 18 and above 120 years old. Musk commented sarcastically: “No more loans to babies or people too old to be alive.”

The discovery was just the latest in a series of contract cancellations and fraud crackdowns led by DOGE. According to Breitbart News, DOGE recently canceled 105 contracts totaling $935 million in potential taxpayer liabilities. The agency’s website currently lists over 6,600 terminated contracts, accounting for $20 billion in savings.

The president praised Musk and DOGE for rooting out government inefficiencies, noting his administration was focused on “cutting” people and programs that were not working or delivering results. “We’re not going to let people collect paychecks or taxpayer funds without doing their jobs,” Trump said.

Also during the cabinet session, USDA Secretary Brooke Rollins revealed her department had eliminated a $300,000 program aimed at teaching “food justice” to transgender and queer farmers in San Francisco. “I’m not even sure what that means,” Rollins said, “but apparently the last administration wanted to put our taxpayer dollars towards that.”

These revelations highlight what many conservatives have long suspected—that during prior administrations, including under President Joe Biden, massive amounts of federal funding were funneled into unserious, ideologically-driven projects and mismanaged government programs. Under the Trump administration’s second term, DOGE appears to be living up to its mission: trimming fat, exposing fraud, and putting American taxpayers first.

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Cuba has lost 24% of it’s population to emigration in the last 4 years

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A new study finds Cuba has lost nearly a quarter of its population since 2020, driven by economic collapse and a mass emigration wave unseen outside of war zones. The country’s population now stands at just over 8 million, down from nearly 10 million.

Key Details:

  • Independent study estimates Cuba’s population at 8.02 million—down 24% in four years.
  • Over 545,000 Cubans left the island in 2024 alone—double the official government figure.
  • Demographer warns the crisis mirrors depopulation seen only in wartime, calling it a “systemic collapse.”

Diving Deeper:

Cuba is undergoing a staggering demographic collapse, losing nearly one in four residents over the past four years, according to a new study by economist and demographer Juan Carlos Albizu-Campos. The report estimates that by the end of 2024, Cuba’s population will stand at just over 8 million people—down from nearly 10 million—a 24% drop that Albizu-Campos says is comparable only to what is seen in war-torn nations.

The study, accessed by the Spanish news agency EFE, points to mass emigration as the primary driver. In 2024 alone, 545,011 Cubans are believed to have left the island. That number is more than double what the regime officially acknowledges, as Cuba’s government only counts those heading to the United States, ignoring large flows to destinations like Mexico, Spain, Serbia, and Uruguay.

Albizu-Campos describes the trend as “demographic emptying,” driven by what he calls a “quasi-permanent polycrisis” in Cuba—an interwoven web of political repression, economic freefall, and social decay. For years, Cubans have faced food and medicine shortages, blackout-plagued days, fuel scarcity, soaring inflation, and a broken currency system. The result has been not just migration, but a desperate stampede for the exits.

Yet, the regime continues to minimize the damage. Official figures from the National Office of Statistics and Information (ONEI) put Cuba’s population at just over 10 million in 2023. However, even those numbers acknowledge a shrinking population and the lowest birth rate in decades—confirming the crisis, if not its full scale.

Cuba hasn’t held a census since 2012. The last scheduled one in 2022 has been repeatedly delayed, allegedly due to lack of resources. Experts doubt that any new attempt will be transparent or complete.

Albizu-Campos warns that the government’s refusal to confront the reality of the collapse is obstructing any chance at solutions. More than just a demographic issue, the study describes Cuba’s situation as a “systemic crisis.”

 

Havana (Cuba, February 2023)” by Bruno Rijsman licensed under CC BY-SA 2.0 DEED.
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