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December 2013: budgetary surplus of $1.1 billion

There was a budgetary surplus of $1.1 billion in December 2013, compared to a deficit of $0.7 billion in December 2012. 

Revenues increased by $1.7 billion, or 7.9 per cent, reflecting increases in most revenue streams. Program expenses increased by $0.1 billion, or 0.5 per cent, while public debt charges decreased by $0.2 billion.  

April to December 2013: budgetary deficit of $12.7 billion

For the April to December 2013 period of the 2013–14 fiscal year, the budgetary deficit stood at $12.7 billion, compared to a deficit of $14.4 billion reported in the same period of 2012–13. 

Revenues were up $7.5 billion, or 4.1 per cent, reflecting increases in personal income tax, non-resident income tax, Goods and Services Tax (GST), Employment Insurance (EI) premium and other revenues. Program expenses were up $6.2 billion, or 3.5 per cent, reflecting increases in major transfers to persons and other levels of government and direct program expenses. Public debt charges were down $0.3 billion, or 1.5 per cent.

December 2013

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There was a budgetary surplus of $1.1 billion in December 2013, compared to a deficit of $0.7 billion in December 2012.

Revenues increased by $1.7 billion, or 7.9 per cent, to $23.8 billion.

  • Personal income tax revenues were up $0.3 billion, or 2.4 per cent.
  • Corporate income tax revenues were up $0.2 billion, or 7.1 per cent.
  • Non-resident income tax revenues were up $0.2 billion, or 76.8 per cent.
  • Excise taxes and duties were up $0.5 billion, or 13.6 per cent. GST revenues were up $0.4 billion, or 19.2 per cent. Energy taxes increased by $9 million, customs import duties increased by $0.1 billion, and other excise taxes and duties decreased by $21 million.
  • EI premium revenues were up $0.1 billion, or 13.1 per cent, consistent with the 2013 premium rate of $1.88 per $100 of insurable earnings. 
  • Other revenues, consisting of net profits from enterprise Crown corporations, revenues of consolidated Crown corporations, revenues from sales of goods and services, returns on investments, net foreign exchange revenues and miscellaneous revenues, were up $0.4 billion, or 19.7 per cent.  

Program expenses in December 2013 were $20.5 billion, up $0.1 billion, or 0.5 per cent, from December 2012 

  • Major transfers to persons, consisting of elderly, EI and children’s benefits, increased by $0.1 billion, or 2.1 per cent. Elderly benefits increased by $0.1 billion, or 3.2 per cent, due to growth in the elderly population and changes in consumer prices, to which benefits are fully indexed. EI benefit payments increased by $25 million, or 1.5 per cent. Children’s benefits, which consist of the Canada Child Tax Benefit and the Universal Child Care Benefit, decreased by $2 million, or 0.2 per cent.   
  • Major transfers to other levels of government consist of federal transfers in support of health and other social programs (primarily the Canada Health Transfer and the Canada Social Transfer), fiscal arrangements and other transfers (Equalization, transfers to the territories, as well as a number of smaller transfer programs), transfers to provinces on behalf of Canada’s cities and communities, and the Quebec Abatement. Major transfers to other levels of government decreased by $0.1 billion, or 1.2 per cent, as legislated growth in the Canada Health Transfer, the Canada Social Transfer, Equalization transfers and transfers to the territories was more than offset by lower transfers to Canada’s cities and communities. 
  • Direct program expenses include transfer payments to individuals and other organizations not included in major transfers to persons and other levels of government, and other direct program expenses, which consist of operating expenses of National Defence, other departments and agencies, and expenses of Crown corporations. Direct program expenses were up $28 million, or 0.3 per cent, from the prior year. Within direct program expenses:
    • Transfer payments decreased by $0.1 billion, or 4.4 per cent.
    • Other direct program expenses increased by $0.2 billion, or 2.7 per cent.

Public debt charges decreased by $0.2 billion, or 9.6 per cent, largely reflecting a lower inflation adjustment on Real Return Bonds.  

April to December 2013

For the April to December 2013 period of the 2013–14 fiscal year, there was a budgetary deficit of $12.7 billion, compared to a deficit of $14.4 billion reported during the same period of 2012–13. 

Revenues increased by $7.5 billion, or 4.1 per cent, to $190.5 billion.

  • Personal income tax revenues were up $3.2 billion, or 3.5 per cent. 
  • Corporate income tax revenues were down $0.6 billion, or 2.8 per cent.
  • Non-resident income tax revenues were up $0.5 billion, or 14.9 per cent. 
  • Excise taxes and duties were up $1.4 billion, or 4.2 per cent, largely reflecting a $1.4‑billion increase in GST revenues. Energy taxes decreased by $7 million, customs import duties increased by $0.2 billion, and other excise taxes and duties decreased by $0.2 billion.
  • EI premium revenues were up $1.2 billion, or 9.6 per cent, reflecting growth in insurable earnings and the 2013 premium rate of $1.88 per $100 of insurable earnings. 
  • Other revenues were up $1.7 billion, or 9.5 per cent, largely reflecting the gain realized on the sale of General Motors common shares in September 2013 as well as an increase in interest and penalties on taxes receivable.

For the April to December 2013 period, program expenses were $181.3 billion, up $6.2 billion, or 3.5 per cent, from the same period the previous year.

  • Major transfers to persons were up $1.3 billion, or 2.4 per cent. Elderly benefits increased by $1.2 billion, or 3.9 per cent, reflecting growth in the elderly population and changes in consumer prices, to which benefits are fully indexed. EI benefit payments decreased by $10 million, or 0.1 per cent, and children’s benefits were up $0.1 billion, or 1.1 per cent.  
  • Major transfers to other levels of government were up $1.3 billion, or 3.0 per cent, due to legislated growth in the Canada Health Transfer, the Canada Social Transfer, Equalization transfers and transfers to the territories, offset in part by a decrease in total transfer protection payments and lower transfers to Canada’s cities and communities.  
  • Direct program expenses were up $3.6 billion, or 4.6 per cent. Within direct program expenses:
    • Transfer payments increased by $3.5 billion, or 15.3 per cent, largely reflecting the accrual of a liability for disaster assistance related to the 2013 flood in Alberta and an increase in expenses associated with the revaluation of the Government’s liability to Ontario for the province’s one-third participation in the value of the Government’s equity holdings in General Motors. 
    • Other direct program expenses increased by $0.1 billion, or 0.1 per cent.

Public debt charges decreased by $0.3 billion, or 1.5 per cent, reflecting a lower average effective interest rate on the stock of interest-bearing debt.

Revenues and expenses (April to December 2013)
Revenues and expenses (April to December 2013) - For details, refer to preceding paragraphs.
Note: Totals may not add due to rounding.

Financial requirement of $2.3 billion for April to December 2013

The budgetary balance is presented on an accrual basis of accounting, recording government revenues and expenses when they are earned or incurred, regardless of when the cash is received or paid. In contrast, the financial source/requirement measures the difference between cash coming in to the Government and cash going out. This measure is affected not only by changes in the budgetary balance but also by the cash source/requirement resulting from the Government’s investing activities through its acquisition of capital assets and its loans, financial investments and advances, as well as from other activities, including payment of accounts payable and collection of accounts receivable, foreign exchange activities, and the amortization of its tangible capital assets. The difference between the budgetary balance and financial source/requirement is recorded in non-budgetary transactions.

With a budgetary deficit of $12.7 billion and a source of $10.4 billion from non-budgetary transactions, there was a financial requirement of $2.3 billion for the April to December 2013 period, compared to a financial requirement of $22.3 billion for the same period the previous year. The decrease in the financial requirement over the previous year mainly reflects the repayment of principal on assets maturing under the Insured Mortgage Purchase Program.

Net financing activities up $4.5 billion

The Government financed this financial requirement of $2.3 billion and increased cash balances by $2.2 billion by increasing market debt by $4.5 billion. The increase in market debt was achieved primarily through the issuance of marketable bonds. The level of cash balances varies from month to month based on a number of factors including periodic large debt maturities, which can be quite volatile on a monthly basis. Cash balances at the end of December 2013 stood at $26.5 billion, up $6.1 billion from their level at the end of December 2012, largely reflecting increased deposits held with the Bank of Canada under the Government’s prudential liquidity plan. 

 
Table 1
Summary statement of transactions
$ millions
  December April to December
 

  20121 2013 2012–131 2013–14
Budgetary transactions        
  Revenues 22,068 23,813 183,031 190,540
  Expenses
    Program expenses -20,352 -20,451 -175,156 -181,339
    Public debt charges -2,448 -2,214 -22,226 -21,900
 

  Budgetary balance (deficit/surplus) -732 1,148 -14,351 -12,699
Non-budgetary transactions 303 -1,417 -7,915 10,431
 

Financial source/requirement -429 -269 -22,266 -2,268
Net change in financing activities -4,298 -3,806 29,321 4,463
 

Net change in cash balances -4,727 -4,075 7,055 2,195
Cash balance at end of period 20,389 26,508
Note: Positive numbers indicate a net source of funds. Negative numbers indicate a net requirement for funds.
1 Comparative figures have been restated to reflect accounting changes in 2013–14 and to conform with the presentation in the Public Accounts of Canada 2013.
 
Table 2
Revenues
  December   April to December  
 
 
 
  2012
($ millions)
2013
($ millions)
Change
(%)
2012–13
($ millions)
2013–14
($ millions)
Change
(%)
Tax revenues            
  Income taxes            
    Personal income tax1 12,084 12,378 2.4 92,559 95,806 3.5
    Corporate income tax2 3,339 3,575 7.1 22,465 21,843 -2.8
    Non-resident income tax3 302 534 76.8 3,499 4,020 14.9
 

    Total income tax 15,725 16,487 4.8 118,523 121,669 2.7
  Excise taxes and duties
    Goods and Services Tax 2,249 2,681 19.2 22,071 23,436 6.2
    Energy taxes 458 467 2.0 4,081 4,074 -0.2
    Customs import duties 260 319 22.7 2,963 3,166 6.9
    Other excise taxes and duties 547 526 -3.8 4,268 4,105 -3.8
 

    Total excise taxes and duties 3,514 3,993 13.6 33,383 34,781 4.2
 

  Total tax revenues 19,239 20,480 6.5 151,906 156,450 3.0
Employment Insurance premiums 809 915 13.1 12,742 13,962 9.6
Other revenues4 2,020 2,418 19.7 18,383 20,128 9.5
 

Total revenues 22,068 23,813 7.9 183,031 190,540 4.1
Note: Totals may not add due to rounding.
1 Comparative figures have been restated to reflect a change in methodology for reporting monthly personal income tax revenue.
2 Comparative figures have been restated to reflect a change in methodology for reporting monthly corporate income tax revenue.
3 Comparative figures have been restated to reflect a change in methodology for reporting monthly non-resident income tax revenue.
4 Comparative figures have been restated to reflect the reclassification of interest owed to taxpayers from other revenues to other direct program expenses of departments and agencies.
 
Table 3
Expenses
  December   April to December  
 
 
 
  2012
($ millions)
2013
($ millions)
Change
(%)
2012–13
($ millions)
2013–14
($ millions)
Change
(%)
Major transfers to persons            
  Elderly benefits 3,400 3,508 3.2 30,049 31,219 3.9
  Employment Insurance benefits 1,643 1,668 1.5 12,532 12,522 -0.1
  Children's benefits 1,091 1,089 -0.2 9,818 9,923 1.1
 

  Total 6,134 6,265 2.1 52,399 53,664 2.4
Major transfers to other levels
  of government
  Support for health and other
    social programs
    Canada Health Transfer 2,425 2,545 4.9 21,661 22,910 5.8
    Canada Social Transfer 989 1,017 2.8 8,895 9,161 3.0
 

    Total 3,414 3,562 4.3 30,556 32,071 5.0
  Fiscal arrangements and other transfers 1,497 1,566 4.6 14,765 14,770 0.0
  Canada's cities and communities 347 75 -78.4 1,858 1,736 -6.6
  Quebec Abatement -343 -348 1.5 -3,090 -3,170 2.6
 

  Total 4,915 4,855 -1.2 44,089 45,407 3.0
Direct program expenses
  Transfer payments
    Aboriginal Affairs and
      Northern Development
781 514 -34.2 4,638 4,530 -2.3
    Agriculture and Agri-Food 271 166 -38.7 976 850 -12.9
    Employment and Social Development 327 412 26.0 4,011 4,061 1.2
    Foreign Affairs, Trade and Development 368 341 -7.3 1,814 1,962 8.2
    Health 158 240 51.9 1,879 2,145 14.2
    Industry 200 314 57.0 1,601 1,883 17.6
    Other 1,041 1,021 -1.9 8,285 11,313 36.5
 

    Total 3,146 3,008 -4.4 23,204 26,744 15.3
  Other direct program expenses
    Crown corporations 549 543 -1.1 5,660 5,587 -1.3
    National Defence 1,824 1,806 -1.0 15,259 14,974 -1.9
    All other departments
      and agencies1
3,784 3,974 5.0 34,545 34,963 1.2
 

    Total other direct program expenses 6,157 6,323 2.7 55,464 55,524 0.1
 

  Total direct program expenses 9,303 9,331 0.3 78,668 82,268 4.6
 

Total program expenses 20,352 20,451 0.5 175,156 181,339 3.5
Public debt charges 2,448 2,214 -9.6 22,226 21,900 -1.5
 

Total expenses 22,800 22,665 -0.6 197,382 203,239 3.0
Note: Totals may not add due to rounding.
1 Comparative figures have been restated to reflect the reclassification of interest owed to taxpayers from other revenues to other direct program expenses of departments and agencies.
 
Table 4
The budgetary balance and financial source/requirement
$ millions
  December April to December
 

  2012 2013 2012–13 2013–14
Budgetary balance (deficit/surplus) -732 1,148 -14,351 -12,699
Non-budgetary transactions
  Capital investment activities 4 -553 -1,980 -3,069
  Other investing activities 208 287 -3,213 21,434
  Pension and other accounts 450 677 4,268 4,013
  Other activities    
    Accounts payable, receivables, accruals and allowances1 5 -1,860 -11,445 -8,520
    Foreign exchange activities -444 -495 1,639 -6,220
    Amortization of tangible capital assets 80 527 2,816 2,793
 

    Total other activities -359 -1,828 -6,990 -11,947
 

  Total non-budgetary transactions 303 -1,417 -7,915 10,431
 

Financial source/requirement -429 -269 -22,266 -2,268
Note: Totals may not add due to rounding.
1 Comparative figures have been restated to reflect a change in methodology for reporting monthly personal, corporate, and non-resident income tax revenues.
 
Table 5
Financial source/requirement and net financing activities
$ millions
  December April to December
 

  2012 2013 2012–13 2013–14
Financial source/requirement -429 -269 -22,266 -2,268
Net increase (+)/decrease (-) in financing activities
  Unmatured debt transactions
    Canadian currency borrowings
      Marketable bonds -1,258 594 11,536 10,254
      Treasury bills -4,400 -5,100 16,600 -9,600
      Retail debt 287 284 -1,372 -1,059
      Other 0 0 -11 0
 

      Total -5,371 -4,222 26,753 -405
    Foreign currency borrowings 98 81 60 953
 

    Total -5,273 -4,141 26,813 548
    Cross-currency swap revaluation 230 277 505 3,576
    Unamortized discounts and premiums on market debt 753 125 2,096 391
    Obligations related to capital leases and other unmatured debt -8 -67 -93 -52
 

  Net change in financing activities -4,298 -3,806 29,321 4,463
Change in cash balance -4,727 -4,075 7,055 2,195
Note: Totals may not add due to rounding.
 
Table 6
Condensed statement of assets and liabilities
$ millions
March 31,
2013
December 31,
2013
Change
Liabilities
   Accounts payable and accrued liabilities 118,744 111,336 -7,408
   Interest-bearing debt
      Unmatured debt
         Payable in Canadian currency
            Marketable bonds 469,039 479,293 10,254
            Treasury bills 180,689 171,089 -9,600
            Retail debt 7,481 6,422 -1,059
 
            Subtotal 657,209 656,804 -405
      Payable in foreign currencies 10,802 11,755 953
      Cross-currency swap revaluation -3,419 157 3,576
      Unamortized discounts and premiums on market debt -2,156 -1,765 391
      Obligations related to capital leases and other unmatured debt 4,564 4,512 -52
 
      Total unmatured debt 667,000 671,463 4,463
     Pension and other liabilities  
         Public sector pensions 151,667 152,358 691
         Other employee and veteran future benefits 67,301 70,688 3,387
         Other liabilities 6,046 5,981 -65
 
         Total pension and other liabilities 225,014 229,027 4,013
 
      Total interest-bearing debt 892,014 900,490 8,476
 
   Total liabilities 1,010,758 1,011,826 1,068
Financial assets
   Cash and accounts receivable 124,154 127,461 3,307
   Foreign exchange accounts 58,759 64,979 6,220
   Loans, investments, and advances (net of allowances)1 156,482 138,480 -18,002
 
   Total financial assets 339,395 330,920 -8,475
 
Net debt 671,363 680,906 9,543
Non-financial assets 68,922 69,198 276
 
Federal debt (accumulated deficit) 602,441 611,708 9,267
Note: Totals may not add due to rounding.
1 December 31, 2013 amount includes $3.4 billion in other comprehensive income from enterprise Crown corporations and other government business enterprises for the April 2013 to December 2013 period.

Note: Unless otherwise noted, changes in financial results are presented on a year-over-year basis.

For inquiries about this publication, contact Nicholas Leswick at 613-995-6391.

February 2014