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Fiscal Sustainability Report 2020: Update

PDF
Étienne Bergeron; Sarah MacPhee; Carleigh Busby; Caroline Nicol; Tim Scholz; Diarra Sourang
Published on November 6, 2020 PDF

This report updates PBO’s February 2020 assessment of the sustainability of government finances over the long term for the federal government, subnational governments and public pension plans. It incorporates federal and provincial budgetary measures up to 1 September and 30 October, respectively.

Communications

News Release

{"id":8,"created_at":"2020-11-04T13:23:27-05:00","updated_at":"2021-02-25T15:07:04-05:00","slug":"COM-2021-008--despite-the-impacts-of-the-pandemic-federal-finances-still-sustainable-over-the-long-term-says-pbo--malgre-les-repercussions-de-la-pandemie-les-finances-federales-demeurent-viables-a-long-terme-selon-le-dpb","title_en":"Despite the impacts of the pandemic, federal finances still sustainable over the long term, says PBO","title_fr":"Malgr\u00e9 les r\u00e9percussions de la pand\u00e9mie, les finances f\u00e9d\u00e9rales demeurent viables \u00e0 long terme selon le DPB","body_en":"The Parliamentary Budget Officer (PBO) today released an update of his assessment of the long-term sustainability of government finances, analyzing the impacts of unprecedent pandemic support spending on public finances in Canada.\n\nAccording to PBO Yves Giroux, the long-term outlook for the government sector as a whole remains sustainable under current fiscal policy\u2014assuming no new permanent programs are introduced.\n\nFiscal Sustainability Report 2020: Update incorporates federal and provincial governments\u2019 pandemic budgetary measures and assumes that these measures are withdrawn as currently scheduled. \n\nBased on the PBO\u2019s assessment, the federal government, and the provinces of Quebec, Nova Scotia, as well as Ontario all have the fiscal flexibility to increase spending or to reduce taxes. Current fiscal policy is not sustainable in the remaining provinces and the Territories. \n\n\u201cAssuming that pandemic spending is temporary, current fiscal policy at the federal level is sustainable over the long term\u201d, says Yves Giroux, PBO. \u201cHowever, most provinces face a financial situation that is unsustainable in the long term.\u201d\n\nRising health care costs due to population ageing continue to drive the deterioration in provincial and territorial government finances over the long term. The negative impact of the pandemic and oil price shocks contribute to higher program spending relative to GDP, straining finances across provinces and territories in 2020.\n\nThe Fiscal Sustainability Report 2020: Update is designed to identify whether changes in current fiscal policy are necessary to avoid excessive growth in government debt and estimate the magnitude of those changes using the fiscal gap.","body_fr":"Le directeur parlementaire du budget (DPB) a publi\u00e9 aujourd\u2019hui une mise \u00e0 jour de son \u00e9valuation de la viabilit\u00e9 \u00e0 long terme des finances du gouvernement, dans laquelle il analyse les r\u00e9percussions des d\u00e9penses d\u2019aide sans pr\u00e9c\u00e9dent engag\u00e9es pendant la pand\u00e9mie sur les finances publiques du Canada.\n\nSelon le DPB Yves Giroux, les perspectives \u00e0 long terme pour l\u2019ensemble du secteur gouvernemental demeurent viables au titre de la politique budg\u00e9taire actuelle, pourvu qu\u2019aucun nouveau programme permanent ne soit lanc\u00e9.\n\nLa mise \u00e0 jour du Rapport sur la viabilit\u00e9 financi\u00e8re de 2020 tient compte des mesures budg\u00e9taires prises par les gouvernements f\u00e9d\u00e9ral et provinciaux pendant la pand\u00e9mie et tient pour acquis qu\u2019elles arriveront \u00e0 \u00e9ch\u00e9ance comme pr\u00e9vu.\n\nSelon l\u2019\u00e9valuation du DPB, le gouvernement f\u00e9d\u00e9ral et les provinces du Qu\u00e9bec, de la Nouvelle \u00c9cosse et de l\u2019Ontario disposent tous d\u2019une marge de man\u0153uvre financi\u00e8re pour augmenter les d\u00e9penses ou r\u00e9duire les imp\u00f4ts et les taxes. La politique budg\u00e9taire actuelle n\u2019est pas viable dans les autres provinces et dans les territoires.\n\n\u00ab Si l\u2019on part du principe que les d\u00e9penses engag\u00e9es pendant la pand\u00e9mie sont temporaires, la politique budg\u00e9taire actuelle est viable \u00e0 long terme \u00e0 l\u2019\u00e9chelle f\u00e9d\u00e9rale, soutient Yves Giroux, DPB. Par contre, la plupart des provinces sont dans une situation insoutenable \u00e0 long terme. \u00bb\n\nL\u2019augmentation des co\u00fbts des soins de sant\u00e9 attribuable au vieillissement de la population continuera d\u2019entra\u00eener une d\u00e9t\u00e9rioration des finances des gouvernements provinciaux et territoriaux \u00e0 long terme. Les r\u00e9percussions n\u00e9gatives de la pand\u00e9mie et les chocs des prix p\u00e9troliers contribuent \u00e0 la hausse des d\u00e9penses de programme par rapport au PIB et exercent des pressions sur les finances des provinces et des territoires en 2020.\n\nLa mise \u00e0 jour du Rapport sur la viabilit\u00e9 financi\u00e8re de 2020 vise \u00e0 d\u00e9terminer s\u2019il faut modifier la politique budg\u00e9taire actuelle afin d\u2019\u00e9viter une croissance excessive de la dette gouvernementale et \u00e0 \u00e9valuer l\u2019ampleur de ces changements au moyen de l\u2019\u00e9cart financier.","release_date":"2020-11-06T09:00:00-05:00","is_published":"2021-02-25T15:07:04-05:00","internal_id":"COM-2021-008","permalinks":{"en":{"website":"https:\/\/www.pbo-dpb.ca\/en\/blog\/news-releases--communiques-de-presse\/COM-2021-008--despite-the-impacts-of-the-pandemic-federal-finances-still-sustainable-over-the-long-term-says-pbo--malgre-les-repercussions-de-la-pandemie-les-finances-federales-demeurent-viables-a-long-terme-selon-le-dpb"},"fr":{"website":"https:\/\/www.pbo-dpb.ca\/fr\/blog\/news-releases--communiques-de-presse\/COM-2021-008--despite-the-impacts-of-the-pandemic-federal-finances-still-sustainable-over-the-long-term-says-pbo--malgre-les-repercussions-de-la-pandemie-les-finances-federales-demeurent-viables-a-long-terme-selon-le-dpb"}},"pivot":{"publication_id":54,"news_release_id":8}}
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