Statistics Canada is reporting that Canadian governments on all levels have piled up a “historic deficit” of $325.5 billion.
The combined shortfall accrued by federal, provincial and local governments was mostly on account of measures related to and lower revenues because of the COVID-19 pandemic.
The $325.5 billion deficit covers the fiscal year 2020 ending March 31, 2021.
“By comparison, the deficit was $40.7 billion in 2019, whereas the consolidated government finances were balanced in 2018,” Statistics Canada reported Monday (November 22).
For the 2020 reference year, the deficit amounted to 14.8 percent of nominal gross domestic product.
This represents a significant jump from 2019, when the deficit was 1.8 percent of nominal GDP.
“Increased expenses (+30.7%), particularly in health care and social protection, and, to a lesser extent, decreased revenues (-1.9%) related to the COVID-19 pandemic, simultaneously worsened the deficit,” Statistics Canada reported.
In particular, the federal government accounted for the majority or $274.4 billion of the Canadian general government deficit in 2020.
Meanwhile, the consolidated deficits of provincial, territorial and local governments amounted to $51.2 billion.
The report included current estimates of social support measures, such as the Canada Emergency Wage Subsidy, and the Canada Emergency Response Benefit.
Statistics Canada noted that “some governments have not finished tabulating their program expenditures and published their public accounts”.
“Although these measures were taken into account in this release, revisions are to be expected when the final data become available,” the agency reported.