Spending restraint: Roadmap to a balanced budget

A Case for Spending Restraint: How the Federal Government Can Balance the Budget

By Grady Munro and Jake Fuss

Since 2015, there has been a deterioration in the federal government’s fiscal situation. Annual
nominal program spending has increased an estimated $193.6 billion since 2014/15; adjusted for
inflation and population growth this represents an extra $2,330 per person. Prior to the COVID
pandemic, spending increased faster than population, inflation, and other relevant economic
indicators. These spending increases have resulted in a string of large budgetary deficits that have
contributed to an estimated $941.9 billion increase in gross federal debt from 2014/15 to 2023/24.
This accumulation of debt, along with recent hikes in interest rates, has raised the cost of interest
on the federal debt to one of the largest budget expense items.

Moving forward, the federal government plans to slow nominal spending growth, which will keep inflation-adjusted, per-person spending relatively constant to 2026/27. Despite this, the federal government will continue running budget deficits and accumulating debt. It is also uncertain whether the federal government’s current estimates are truly reliable as the estimates do not incorporate expected spending on pharmacare or the level of defence spending to meet Canada’s NATO commitment. Moreover, the federal government’s track record of exceeding previous spending commitments calls into question the reliability of the current spending targets. Therefore, it is clear the federal government is not implementing the level of spending restraint necessary to reverse course towards a stable fiscal situation.

An approach to federal finances that continues to run budget deficits and accumulate debt is economically harmful to both current and future generations of Canadians. Research shows that significant increases in debt-financed spending harm economic growth by reducing capital accumulation and labour productivity.

Furthermore, accumulating debt today increases the tax burden on future generations of Canadians, as they will be responsible for paying off this debt. Despite these effects, the federal government plans to continue running deficits and accumulating debt for the foreseeable future.

This need not be the case. The federal government can undertake decisive spending reform starting in 2024— similar to the reform by the Chrétien government in the 1990s—that balances the budget within a year or two. The federal government could balance the budget in 2026/27 by limiting annual growth in nominal program spending to 0.3% for two years. This would result in a 5.9% reduction in real per-person spending. Alternatively, the budget could be balanced in 2025/26 if the federal government reduces spending 4.3% for one year; the next year, 2026/27, would see a budgetary surplus. In this scenario, inflation-adjusted per-person spending would decline by 7.5%. Key trade-offs between the two approaches include the extent of the spending reform and the speed of the return to balanced budgets. Balancing the budget in one year, as opposed to two years, would
result in $30.0 billion less debt accumulated by 2026/27.

Though it is beyond the scope of this study to discuss how such spending reforms should be implemented, there are three areas that might be considered for reform. Business subsidies are a significant expense, yet research suggests they have little if any economic benefit, and may actually harm economic growth when governments pick winners and losers in a free market. Reviewing business subsidies might provide opportunities to find savings. Aligning government-sector wages
with those in the private sector would also provide savings, as government workers in Canada currently enjoy an 8.5% wage premium (on average) relative to comparable private-sector workers. Finally, studies show that government fiscal waste can be significant. From 1988 to 2013, more than 600 government failures cost the federal government between $158.3 billion and $197.1 billion. Moreover, more than 25% of all federal COVID spending was wasteful. Addressing inefficiencies within government might also reveal savings.

Canada has seen a deterioration in the federal government’s fiscal situation since 2015. A distinct lack of spending restraint has resulted in a string of large budget deficits, which have contributed to rising government debt and debt interest costs.
Despite current fiscal plans promising more of the same, the federal government could implement decisive spending reform starting in 2024/25, similar to reforms implemented in the 1990s, and balance the budget within one or two years.
To balance the budget by 2026/27, the federal government would need to limit growth in annual nominal program spending to 0.3 percent for two years. This would translate to a 5.9 percent reduction in inflation-adjusted, per-person spending.
Alternatively, the federal government could balance the budget in one year, by 2025/26, by reducing nominal program spending by 4.3 percent. Adjusted for inflation and population, this would be a 7.5 percent decrease. In 2026/27, the federal government could then record a $8.2 billion surplus even while increasing spending from the previous year.
While this study does not provide an in-depth analysis of where potential savings should be found, research highlights three potential areas that could be targeted for spending reform: corporate welfare, aligning government-sector wages with those in the private sector, or eliminating government fiscal waste.

A Case for Spending Restraint in Canada: How the Federal Government Can Balance the Budget

Authors:

Grady Munro

Policy Analyst, Fraser Institute

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Click here to read the full report

Related Topics:#BalancedBudget #FederalGovernment #FraserInstitute #GradyMunro #JakeFuss

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Carney’s Honeymoon Phase Enters a ‘Make-or-Break’ Week

Published on June 16, 2025

Todayville

From the National Citizens Coalition

The National Citizens Coalition (NCC) is sounding the alarm on a critical week for the Carney government, which, despite enjoying an unearned honeymoon in the polls, has delivered zero results for everyday Canadians. As the G7 summit looms large and the House of Commons prepares to adjourn, this is a make-or-break moment for Prime Minister Mark Carney to prove his government is more than empty promises. Canadians are watching, and the NCC is calling out the glaring failures that threaten a grim summer of economic decline, and continued crime, chaos, and rising unemployment.

Housing Minister Gregor Robertson Caught in $10.85 Million Scandal

Recent revelations from Blacklock’s Reporter expose Housing Minister Gregor Robertson’s attempt to conceal $10.85 million in personal property investments during Commons questioning. This shocking lack of transparency from the minister tasked with addressing Canada’s housing crisis raises serious questions about his integrity and ability to prioritize Canadians struggling with skyrocketing costs. While Robertson dodges accountability, and Carney apparently scoffs at providing housing relief to millions suffering under a Liberal-made crisis, young professionals and young families are wondering if they’ll ever have a chance to own a home bigger than Canada’s much-maligned supply of ‘dog-crate condos.’

The NCC demands a full ethics investigation, the resignation of Gregor Robertson — who, as one of the architects of the Vancouver housing crisis, should have never been handed this file to begin with — and immediate action to restore trust in this critical portfolio.

Pipeline Delays and Provincial Obstruction Threaten Economic Growth

The Carney government’s inaction on pipelines is stalling Canada’s economic potential. Despite promises of “nation-building projects,” British Columbia and Quebec continue to block and veto critical energy infrastructure, with Carney failing to assert federal leadership. His vague talk of “consensus” and “decarbonized” barrels has led to zero progress, leaving Alberta’s economy in limbo and Canadians facing higher energy costs. With no clear plan to advance projects, the government is squandering opportunities to create jobs and secure energy sovereignty. The NCC urges Carney to act decisively this week to break the provincial logjam and deliver results.

Immigration Chaos: Lena Diab’s Unchecked Honour System Fails Canadians

Immigration Minister Lena Diab’s reliance on an ‘honour system’ for millions of temporary visitors with expiring visas is a recipe for disaster. As Canada grapples with unsustainable immigration levels, Diab’s apparent plan for millions of temporary workers and failed ‘diploma mill’ attendees assumes compliance without enforcement, ignoring the high-propensity for fraud, and the ongoing and urgent strain on housing, healthcare, and public services. The Liberals’ Strong Borders Act promises reform, but its loaded with unnecessary overreach and vague measures.

A lack of urgency leaves Canadians vulnerable to further crime, chaos, closed emergency rooms, high rents, and failing infrastructure. With immigration continuing to spiral out of control, the NCC calls for concrete action to drastically lower immigration targets, expedite deportations, and prioritize Canadian citizens and the record amounts of unemployed before the House adjourns.

Canadians Deserve Results, Not More Hollow “Elbows up” or “Team Canada” Rhetoric

This week’s G7 summit in Alberta and the impending House adjournment are the Carney government’s last chance to show leadership, before an undeserved summer break for a government that will be overseeing deepening economic decline, rising crime under a refusal to tackle catch-and-release bail, and growing unemployment. Canadians cannot afford another season of unfulfilled promises and unchecked crises. The NCC demands Carney use the G7 platform to secure trade stability, meaningful energy deals with our allies, and table a federal budget to address the cost-of-living crisis made worse by inflationary Liberal spending. Failure to act now will cement an early legacy of inaction and leave Canadians to endure a prolonged period of hardship.

“The Carney government’s honeymoon has been built on hype, not results,” says NCC Director Alexander Brown. “From Gregor Robertson’s hidden millions, to stalled pipelines, to an immigration system in continued disarray, Canadians — and particularly young Canadians — are being let down. This week is Carney’s chance to prove he can deliver beyond the lies that were told to placate a portion of the electorate at the polls. If he fails to act, the economic decline, the crime and chaos, will only worsen, and everyday Canadians will pay the price.

“True Canadian leaders like Alberta Premier Danielle Smith are in attendance at the G7 along with Carney. If actual acts of ‘nation-building,’ and not more net-zero de-growth, do not come naturally to the PM, he should turn to those who have never wavered in their quest to make life more affordable for the hard-working citizens they are privileged to represent, and who know when to get out of the way to allow Canadians to prosper. More of the same internal, ideological sabotage from the Liberals cannot ruin this dire moment for Canada’s rebirth and recovery.”

The NCC calls on all Canadians to hold the Carney government accountable. Join us in demanding transparency, action, and results before the House adjourns and the G7 summit concludes. Together, we can fight for a stronger, more prosperous Canada.

About the National Citizens Coalition: Founded in 1967, the NCC is a non-profit organization dedicated to advocating for individual freedom, lower taxes, less government waste, and a stronger Canada. We hold governments accountable and fight for the interests of everyday Canadians.

Alberta

Alberta announces citizens will have to pay for their COVID shots

Published on June 16, 2025

Todayville

From LifeSite News

By Anthony Murdoch

The government said that it has decided to stop ‘waste’ by not making the shots free starting this fall.

Beginning this fall, COVID shots in the province will have to be pre-ordered at the full price, about $110, to receive them. (This will roll out in four ‘phases’. In the first phases COVID shots will still be free for those with pre-existing medical conditions, people on social programs, and seniors.)

The UCP government in a press release late last week noted due to new “federal COVID-19 vaccine procurement” rules, which place provinces and territories as being responsible for purchasing the jabs for residents, it has decided to stop “waste” by not making the jab free anymore.

“Now that Alberta’s government is responsible for procuring vaccines, it’s important to better determine how many vaccines are needed to support efforts to minimize waste and control costs,” the government stated.

“This new approach will ensure Alberta’s government is able to better determine its overall COVID-19 vaccine needs in the coming years, preventing significant waste.”

The New Democratic Party (NDP) took issue with the move to stop giving out the COVID shots for free, claiming it was “cruel” and would place a “financial burden” on people wanting the shots.

NDP health critic Sarah Hoffman claimed the move by the UCP is health “privatization” and the government should promote the abortion-tainted shots instead.

The UCP said that in 2023-2024, about 54 percent of the COVID shots were wasted, with Health Minister Adriana LaGrange saying, “In previous years, we’ve seen significant vaccine wastage.”

“By shifting to a targeted approach and introducing pre-ordering, we aim to better align supply with demand – ensuring we remain fiscally responsible while continuing to protect those at highest risk,” she said.

The jabs will only be available through public health clinics, with pharmacies no longer giving them out.

The UCP also noted that is change in policy comes as a result of the Federal Drug Administration in the United States recommending the jabs be stopped for young children and pregnant women.

The opposite happened in Canada, with the nation’s National Advisory Committee on Immunization (NACI) continuing to say that pregnant women should still regularly get COVID shots as part of their regular vaccine schedule.

The change in COVID jab policy is no surprise given Smith’s opposition to mandatory shots.

As reported by LifeSiteNews, early this year, Smith’s UCP government said it would consider halting COVID vaccines for healthy children.

Smith’s reasoning was in response to the Alberta COVID-19 Pandemic Data Review Task Force’s “COVID Pandemic Response” 269-page final report. The report was commissioned by Smith last year, giving the task force a sweeping mandate to investigate her predecessor’s COVID-era mandates and policies.

The task force’s final report recommended halting “the use of COVID-19 vaccines without full disclosure of their potential risks” as well as outright ending their use “for healthy children and teenagers as other jurisdictions have done,” mentioning countries like “Denmark, Sweden, Norway, Finland, and the U.K.”

The mRNA shots have also been linked to a multitude of negative and often severe side effects in children and all have connections to cell lines derived from aborted babies.

Many Canadian doctors who spoke out against COVID mandates and the experimental mRNA injections were censured by their medical boards.

LifeSiteNews has published an extensive amount of research on the dangers of the experimental COVID mRNA jabs that include heart damage and blood clots.