Ottawa, October 5, 2012

Archived - Annual Financial Report Confirms Canada’s Deficit on Downward Track Despite Global Challenges

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The Honourable Jim Flaherty, Minister of Finance, today released the Annual Financial Report of the Government of Canada for 2011–12. The report shows a reduction in the budgetary deficit to $26.2 billion from $33.4 billion in the previous fiscal year, and a reduction of more than half from the $55.6-billion budgetary deficit recorded in 2009–10.

“This positive performance is encouraging and reflects Canada’s sound economic and fiscal fundamentals,” said Minister Flaherty. “However, the global economic environment is still fragile and uncertain, and recent economic developments suggest that there are downside risks to the fiscal outlook contained in Economic Action Plan 2012. Nonetheless, our Government remains committed to achieving our goal of returning to balanced budgets over the medium term. I will provide an update of the economic and fiscal outlook in the fall Update of Economic and Fiscal Projections.”

The Annual Financial Report also clearly demonstrates the Harper Government’s ongoing efforts to ensure continued prudent and responsible spending, with direct program expenses in 2011–12 falling 0.6 percentage points as a share of gross domestic product (GDP) from 2010–11 levels.

As reported by the Organisation for Economic Co-operation and Development (OECD), Canada’s total government net debt-to-GDP ratio, which includes the net debt of the federal, provincial/territorial and local governments, as well as the net assets held in the Canada Pension Plan and Québec Pension Plan, stood at 33.3 per cent in 2011. This is the lowest level among Group of Seven (G-7) countries, with Germany the second lowest at 52.0 per cent and the G-7 average estimated at 80.4 per cent of GDP for that same year.

For further information, media may contact:

Kathleen Perchaluk
Press Secretary
Office of the Minister of Finance

Jack Aubry
Media Relations
Department of Finance

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