Skip to main content
Access every election story that matters
Enjoy unlimited digital access
$1.99
per week for 24 weeks
Access every election story that matters
Enjoy unlimited digital access
$1.99
per week
for 24 weeks
// //

Treasury Board President Tony Clement speaks in the House of Commons on June 12, 2013. Clement, who oversees how departments manage the various spending cuts and budget freezes that are part of the government’s plan to eliminate the deficit, says Ottawa’s better bottom line for 2013-14 is thanks to a culture change in the public service.

SEAN KILPATRICK/The Canadian Press

Nearly $8-billion in unexpected revenue, lower-than-expected costs for the Alberta floods, lower direct spending and an accounting change have all contributed to the federal government's significantly improved bottom line.

Finance Canada released additional details on Monday confirming last year's deficit was much smaller than the government had projected just eight months ago. The deficit came in at $5.2-billion rather than the $11.4-billion estimated earlier this year in the budget.

The Conservative government is keeping a tight grip on federal spending as it moves closer to balanced books, but the opposition says "stealth cuts" are at the root of Ottawa's shrinking deficit.

Story continues below advertisement

Direct program spending came in $2.8-billion lower than expected, marking the fourth year in a row that spending in that area has declined. The category excludes items such as provincial transfers and represents spending that is directly under the federal government's control.

Treasury Board President Tony Clement, who oversees how departments manage the various spending cuts and budget freezes that are part of the government's plan to eliminate the deficit, said the better bottom line comes from a culture change in the public service.

"The psychology of government in terms of seeking new funds has been broken," he said in an interview with The Globe and Mail.

Measured as a percentage of gross domestic product, overall federal spending has dropped from 17.7 per cent during the peak of stimulus spending in 2009-10 to 14.7 per cent last year, which is slightly smaller than the 15 per cent when Stephen Harper's government was first elected in 2006.

Opposition MPs say the government celebrates the lower spending but does not explain what has been cut. NDP MP Guy Caron said the Conservatives appear to be inflating their deficit estimates to make themselves look good later.

"This is nothing to be proud of," he said.

Liberal MP Scott Brison said more detail is needed on cuts and whether they are sustainable.

Story continues below advertisement

"Clearly, one-time asset sales and stealth cuts form a significant part of this adjustment, but again, the Conservatives aren't being open or transparent with the details," he said.

Monday's Finance Canada report indicates several factors contributed to the smaller deficit. One is an accounting change related to bond buybacks that means, for comparison purposes, the estimated deficit figure from the February budget is reduced to $15.9-billion from $16.6-billion. After that adjustment, the final deficit figure was $10.7-billion smaller than projected.

The main factor was $7.7-billion in unexpected revenue across all streams, including personal and corporate income tax, employment insurance premiums and $2.8-billion in "other revenues."

The report said the estimated federal liability under the Disaster Financial Assistance Arrangements for assistance related to the 2013 flood in Alberta was $1.2-billion lower than expected, "reflecting updated information from the province."

The report marks the second year in a row that the final deficit numbers came in significantly smaller than projected in the preceding budget. At this time last year, the government announced the 2012-13 deficit came in at $18.9-billion rather than $25.9-billion as projected in the 2013 budget.

Your Globe

Build your personal news feed

  1. Follow topics and authors relevant to your reading interests.
  2. Check your Following feed daily, and never miss an article. Access your Following feed from your account menu at the top right corner of every page.

Follow the author of this article:

View more suggestions in Following Read more about following topics and authors
Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

If you do not see your comment posted immediately, it is being reviewed by the moderation team and may appear shortly, generally within an hour.

We aim to have all comments reviewed in a timely manner.

Comments that violate our community guidelines will not be posted.

UPDATED: Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies