Winnipeg Free Press - PRINT EDITION

No back in black by 2015: Flaherty

  • Print

OTTAWA -- Canada's promise to get back into the black by 2015 was tossed out the window Tuesday.

In a speech in Fredericton, N.B., Tuesday, Finance Minister Jim Flaherty admitted the government will not be able to balance the books until at least 2016-17, a year later than he has been promising for the last three years. Canada will also see deficits increase by $20.4 billion over the next four years, forced upward by shrinking revenues in the face of global economic weakness.

"Canada has clearly been affected by volatile and falling world commodity prices since the budget in late March," he said.

Eight months ago, Flaherty predicted he would be able to balance Ottawa's books again in 2015-16. However, the latest economic figures suggest he will have an average of $7.2 billion a year less in revenues than he anticipated over the next four years. It means the federal government's deficit this year will be $26 billion, $5 billion more than Flaherty estimated in his 2012-13 budget last spring. Next year, the deficit will climb to $16.5 billion from $10.2 billion, and in 2014-15 it will jump to $8.6 billion from $1.3 billion. In 2015-16, the once-projected surplus of $3.4 billion is going to be a deficit of $1.8 billion.

In 2016-17, the government now anticipates posting its first surplus since 2009, projecting a $1.7-billion surplus.

Flaherty had been predicting a return to a balanced budget in 2015-16 since at least 2010 -- and Prime Minister Stephen Harper promised as much during the 2011 federal election. However, the change likely won't be a surprise to many financial experts, many of whom have previously said Ottawa was putting far too rosy a spin on the country's economic growth projections in the last three budgets.

Opposition parties, too, were quick to jump on the government for not getting it close to right.

NDP finance critic Peggy Nash said Flaherty and the Conservatives have been "wrong on every forecast" and was critical of the government for wasting money on tax cuts for businesses that have not resulted in job creation.

Manitoba Finance Minister Stan Struthers said he is watching to make sure Flaherty keeps his promise -- reiterated Tuesday -- he will not balance the books by cutting transfers to the provinces. Any federal cuts would cripple the Manitoba government, which relies on Ottawa for more than $1 out of every $4 it has to spend. Manitoba recently had to more than double the forecast for the 2011-12 deficit to nearly $1 billion and is trying to hit its own election promise to balance the province's books by 2014.

Struthers dodged questions Tuesday about whether that target will be met, saying only these are tough economic times and the province will not balance the books by cutting core services such as health care and education.

He said he can sympathize with Flaherty.

"There are a lot of factors that are beyond the control of Mr. Flaherty," he said. "We do, though, need to ensure we are making the right decisions on factors we can control."

Flaherty cautioned Tuesday Canada's finances are dependent somewhat on whether the U.S. Congress and re-elected President Barack Obama can come to an agreement before Jan. 1 to solve the U.S. fiscal crisis.

-- with files from The Canadian Press

Republished from the Winnipeg Free Press print edition November 14, 2012 A9

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes


  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.


Make text: Larger | Smaller


Winnipeg Police remove dumpsters from behind homeless shelter

View more like this

Photo Store Gallery

  • Marc Gallant/Winnipeg Free Press. Gardening Column- Assiniboine Park English Garden. July 19, 2002.
  • Marc Gallant / Winnipeg Free Press.  Local/Weather Standup- Catching rays. Prairie Dog stretches out at Fort Whyte Centre. Fort Whyte has a Prairie Dog enclosure with aprox. 20 dogs young and old. 060607.

View More Gallery Photos


Are you concerned about the number of homicides so far this year?

View Results

Ads by Google