Finance MinisterJoe Oliver answers a question during Question Period in the House of Commons in Ottawa on Wednesday, Jan. 28, 2015. Many Canadians may be looking forward to new federal tax measures helping their finances, but newly released figures show the government's own bottom line is getting a boost, thanks to a number of quiet tax and tariff changes. THE CANADIAN PRESS/Sean KilpatrickThe Canadian Press
The federal government ran a small surplus in November and is on track to post a significantly smaller deficit for the current year than the year before.
Finance Canada's monthly fiscal monitor report shows Ottawa ran a $622-million surplus in November, an improvement over the $554-million deficit in November 2013.
For the current 2014-15 fiscal year that ends March 31, the federal deficit for the year stood at $3.3-billion, compared to a $13.4-billion deficit for the same period a year earlier.
In a separate report released Friday morning by the International Monetary Fund on the Canadian economy and government finances, the organization said Ottawa is "essentially on track" to achieving a balanced budget in 2015-16.
"Recently introduced income tax cuts and enhanced child care benefits, as well as lower oil prices that will affect nominal tax revenues, are not expected to materially delay reaching budgetary balance in [2015-16]," the IMF states.
The IMF report was finalized before the Bank of Canada's Jan. 21 decision to cut interest rates.
Figures for Canadian Gross Domestic Product were also released Friday, showing a contraction in November that surprised economists.
Finance Minister Joe Oliver's Nov. 12 fiscal update projected a $2.9-billion deficit in 2014-15 and a $1.9-billion surplus in 2015-16. However those projections assumed the price of North American crude would stay at $81 (U.S.) a barrel. Oil is trading this week around $45 a barrel.
Parliamentary Budget Officer Jean-Denis Fréchette issued a report earlier this week indicating that by assuming oil prices remain at $48 a barrel, federal revenues would be reduced by $4.8-billion annually. Mr. Fréchette also said that with some adjustments, the government could still meet its target of erasing the deficit for 2015-16.
The Conservative 2011 election platform had pledged to eliminate the deficit in 2014-15, but Prime Minister Stephen Harper has said he expects there will be a small deficit in that year before the government returns to surplus.
Bill Curry