Sunday 27 November 2016

2016-28 Deficits, deficits, as far as the eye can see

According to Finance Canada, in the first half of 2016 the Federal government had a deficit of $7.8 billion, compared with a surplus of $1.6 billion in the first half of 2015. This is a deterioration of $9.4 billion, almost equal to the increase in program spending of $8.9 billion. In addition, interest on Federal debt fell by $1.4 billion. This means government expenditures increased by $7.5 billion (8.9-1.4) and so government revenue fell by $1.9 billion (9.4-7.5).

Here is the recent history: 

"The federal government posted a $1.9-billion surplus in 2014-15 after six straight years of deficits. The final bottom line for 2015-16 was a small deficit of $987-million."


And here is the near future:
"Nov. 1 fiscal update projected a $25.1-billion deficit for the current 2016-17 fiscal year. The deficit has been forecast to reach $27.8-billion the next year before shrinking gradually to $14.6-billion by 2021-22. Mr. Morneau has not provided a timeline for when the federal government will return to a balanced budget."
And here is what the government promised a year ago:
"The party’s 2015 campaign platform promised “modest short-term deficits of less than $10-billion in each of the next two fiscal years” and that after that “the deficit will decline and our investment plan will return Canada to a balanced budget in 2019.” " 
Conclusions: 
1. You should vote, as you will be paying for today's deficits
2. Voting alone is not sufficient. You need to become politically active, and hold the government to its promises.


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