Where does Canada’s public deficit come from?
Revenue and spending of the federal government, provinces, municipalities and public pension plans since 1995: the 1990s turnaround, Covid, and a comparison with France.
Scope: Canadian general government (federal, provinces and territories, local government, Canada and Quebec Pension Plans), national accounts, calendar years, OECD data. · Data as of Oct 30, 2026.
Key takeaways
- In 2025, Canadian general government spent C$1,452bn against C$1,398bn of revenue: a deficit of C$54bn, or 1.7% of GDP. Gross debt stands at 118.9% of GDP, but governments also hold large financial assets, including public pension plan reserves: net of those assets, their debt is only 15.7% of GDP.
- The 1990s turnaround: the 5.5% of GDP deficit of 1995 became a 2.6% surplus in 2000. Spending fell from 48.4% of GDP in 1995 to 39.3% in 2007, and interest from 9.3% to 3.9% of GDP (3.4% in 2024).
- From the 2007 surplus (+1.8% of GDP), the balance moved to −2.1% in 2024. Spending gained +5.8 points: cash social benefits (+2.0, from 8.5% to 10.5% of GDP), other transfers (+1.7), operating purchases (+0.8), wages (+0.8) and subsidies (+0.6); interest fell by 0.5 point. Revenue rose by only 1.8 points.
- Modest public pensions: according to the OECD they cost 5.9% of GDP in 2022 (4.5% in 1990), against 13.8% in France; public health costs 7.9% of GDP (9.3% in France). The deficit sits with the federal government (−1.3% of GDP in 2025) and the provinces (−2.0%), while the Canada and Quebec Pension Plans run a surplus (+1.8%).
- Compared with France, Canada spent 11.9 points of GDP less in 2024 (45.1% against 57.0%) and levied 8.2 points less (43.0% against 51.2%). The gap comes from cash social benefits (−8.7 points) and benefits in kind (−4.1); Canada pays more in interest (+1.4) and operating purchases (+2.4). On the revenue side, its social contributions are a third of France’s (−11.3 points) and its taxes on income and wealth are higher (+5.4).
Revenue and spending, year by year
For each year: left bar = revenue (grey), right bar = spending (colours), stacked by type. The gap between the two bars is the deficit (or surplus). Tap an item in the legend to isolate it. Canada does not report spending by function (pensions, health…) to the OECD: spending is shown by nature (benefits, wages, purchases, interest…). Household and corporate income taxes are not published separately.
What widened (or narrowed) the deficit
Change of each item in points of GDP between two years, spending by nature. Spending that rises, or revenue that falls, widens the deficit (bar to the left).
Public balance: 1.8% of GDP in 2007, −2.1% in 2024, a change of −3.9 points. Contribution of spending: −5.8 pt; of revenue: +1.8 pt.
- Cash benefits (pensions, allowances)
- Purchased benefits in kind (reimbursed care…)
- Public employee compensation
- Operating purchases
- Interest on debt
- Subsidies
- Investment
- Other transfers
- Revenue
Detail by item · 2007 → 2024
| Detail by item | Side | 2007 | 2024 | Change (pt) | Effect on balance (pt) |
|---|---|---|---|---|---|
| Other taxes on production (property, energy, alcohol, tobacco…) | Revenue | 9.46 | 6.86 | −2.60 | −2.60 |
| Cash benefits (pensions, allowances) | Spending | 8.51 | 10.46 | +1.95 | −1.95 |
| Other transfers | Spending | 1.49 | 3.19 | +1.70 | −1.70 |
| Operating purchases | Spending | 7.15 | 7.95 | +0.80 | −0.80 |
| Public employee compensation | Spending | 11.70 | 12.45 | +0.75 | −0.75 |
| Subsidies | Spending | 0.98 | 1.55 | +0.57 | −0.57 |
| Purchased benefits in kind (reimbursed care…) | Spending | 1.85 | 2.13 | +0.28 | −0.28 |
| Investment | Spending | 3.75 | 3.95 | +0.21 | −0.21 |
| Other revenue (sales, property income, transfers) | Revenue | 7.95 | 8.27 | +0.32 | +0.32 |
| Interest on debt | Spending | 3.93 | 3.43 | −0.50 | +0.50 |
| Social contributions | Revenue | 4.60 | 5.16 | +0.56 | +0.56 |
| Taxes on income, profits and wealth | Revenue | 17.02 | 17.89 | +0.87 | +0.87 |
| VAT | Revenue | 2.13 | 4.81 | +2.68 | +2.68 |
| Total revenue | Revenue | 41.16 | 42.99 | +1.83 | +1.83 |
| Total spending | Spending | 39.34 | 45.11 | +5.77 | −5.77 |
| Balance | Balance | 1.82 | -2.12 | −3.94 | −3.94 |
The drivers
Pensions and health
Public spending on pensions (old age + survivors) and health, % of GDP, OECD social expenditure database (SOCX), since 1980.
- Pensions · 5.9% (2022)
- Health · 8.0% (2022)
The demographic driver
Share of people aged 65 and over (%), World Bank.
- Aged 65+ · 20.3% (2025)
Public balance
% of GDP. Negative = deficit.
- Balance · −1.7% (2025)
Gross and net debt
% of GDP, OECD. Net financial worth = financial assets minus liabilities.
- Gross debt · 118.9% (2025)
- Net financial worth · −15.7% (2025)
Benefits and interest
Cash social benefits and interest paid by general government, % of GDP.
- Cash benefits · 10.3% (2025)
- Interest · 3.3% (2025)
Who carries the deficit?
Balance by level of government, % of GDP.
- Federal · −1.3% (2025)
- Provinces and territories · −2.0% (2025)
- Local government · −0.2% (2025)
- CPP and QPP · 1.8% (2025)
Canada and France
Same OECD accounts for both countries, same scope (general government), in % of GDP; OECD gross debt for both. As Canada has no spending by function, spending is compared by nature. To the right of a gap chart, Canada is above France.
Public spending, % of GDP
- Canada · 44.7% (2025)
- France · 57.3% (2025)
Public revenue, % of GDP
- Canada · 43.1% (2025)
- France · 52.2% (2025)
Public balance, % of GDP
- Canada · −1.7% (2025)
- France · −5.1% (2025)
Gross public debt, % of GDP
- Canada · 118.9% (2025)
- France · 116.2% (2025)
Structure of revenue
One bar per country, stacked by type of revenue, % of GDP.
- Social contributions
- Taxes on income, profits and wealth
- VAT
- Other taxes on production
- Other revenue
Where Canada levies more (or less) than France
Canada minus France, in points of GDP, same year. To the right, Canada is higher.
- Canada − France · 2025
Spending by nature
What public money pays for: wages, benefits, purchases, investment… France pays far more social benefits, in cash (pensions, allowances) and in kind (reimbursed care).
- Cash benefits (pensions, allowances)
- Purchased benefits in kind (reimbursed care…)
- Public employee compensation
- Operating purchases
- Interest on debt
- Subsidies
- Investment
- Other transfers
Canada − France gap by type of spending, points of GDP
- Canada − France · 2025
Yearly data
Show the table of revenue, spending, balance and debt by year
| Year | Revenue | Spending | Balance | Balance (% of GDP) | Debt (% of GDP) |
|---|---|---|---|---|---|
| 2025 | C$1,398bn | C$1,452bn | −C$54bn | −1.7% | 118.9% |
| 2024 | C$1,336bn | C$1,402bn | −C$66bn | −2.1% | 116.5% |
| 2023 | C$1,258bn | C$1,263bn | −C$4.8bn | −0.2% | 112.1% |
| 2022 | C$1,197bn | C$1,180bn | C$18bn | 0.6% | 109.3% |
| 2021 | C$1,096bn | C$1,174bn | −C$78bn | −3.1% | 131.0% |
| 2020 | C$939bn | C$1,182bn | −C$243bn | −10.9% | 146.0% |
| 2019 | C$958bn | C$958bn | −C$0.4bn | −0.0% | 112.6% |
| 2018 | C$935bn | C$927bn | C$7.8bn | 0.4% | 110.3% |
| 2017 | C$881bn | C$883bn | −C$2.4bn | −0.1% | 112.3% |
| 2016 | C$833bn | C$842bn | −C$9.2bn | −0.5% | 116.2% |
| 2015 | C$812bn | C$813bn | −C$1.2bn | −0.1% | 114.6% |
| 2014 | C$785bn | C$781bn | C$3.5bn | 0.2% | 108.9% |
| 2013 | C$747bn | C$776bn | −C$28bn | −1.5% | 108.2% |
| 2012 | C$716bn | C$762bn | −C$46bn | −2.5% | 113.6% |
| 2011 | C$693bn | C$752bn | −C$59bn | −3.3% | 111.1% |
| 2010 | C$653bn | C$731bn | −C$79bn | −4.7% | 107.6% |
| 2009 | C$635bn | C$696bn | −C$61bn | −3.9% | 104.7% |
| 2008 | C$659bn | C$656bn | C$3.1bn | 0.2% | 90.7% |
| 2007 | C$649bn | C$621bn | C$29bn | 1.8% | 85.7% |
| 2006 | C$618bn | C$591bn | C$27bn | 1.8% | 89.7% |
| 2005 | C$582bn | C$560bn | C$22bn | 1.6% | 92.6% |
| 2004 | C$544bn | C$534bn | C$10bn | 0.8% | 95.5% |
| 2003 | C$514bn | C$515bn | −C$1.6bn | −0.1% | 99.9% |
| 2002 | C$489bn | C$492bn | −C$2.8bn | −0.2% | 104.3% |
| 2001 | C$485bn | C$479bn | C$6.1bn | 0.5% | 105.4% |
| 2000 | C$485bn | C$456bn | C$29bn | 2.6% | 105.8% |
| 1999 | C$445bn | C$428bn | C$17bn | 1.7% | 114.7% |
| 1998 | C$416bn | C$414bn | C$1.3bn | 0.1% | 124.5% |
| 1997 | C$400bn | C$400bn | C$0.4bn | 0.0% | 125.6% |
| 1996 | C$374bn | C$400bn | −C$26bn | −3.1% | 131.9% |
| 1995 | C$357bn | C$402bn | −C$46bn | −5.5% | 125.7% |
Sources and method
- OECD, government accounts. Table 12: total revenue and spending, detail of taxes and contributions, spending by nature, balance by level of government. Statistics Canada national accounts reported to the OECD, calendar years. France in the comparison is read from the same tables.OECD Table 12
- OECD, financial dashboard. General government gross debt and net financial worth, % of GDP.OECD Financial dashboard
- OECD, social expenditure database (SOCX). Public spending on pensions (old age and survivors) and health, % of GDP, 1980–2022.OECD SOCX
- World Bank. Share of people aged 65 and over.World Bank SP.POP.65UP.TO.ZS
- Method. Constant dollars: current dollars adjusted by the GDP deflator (dollars of the latest year). Canada reports no spending by function (COFOG) to the OECD; Statistics Canada publishes a functional classification on another accounting basis (government finance statistics, fiscal years), which does not reconcile with national-accounts totals and is not used here. The rise in VAT and the fall in other taxes on production after 2007 mainly reflect the harmonisation of provincial sales taxes with the GST (HST).
- Further reading. Statistics Canada, Parliamentary Budget Officer, Finance Canada Fiscal Reference Tables, CPP Investments.Statistics CanadaParliamentary Budget OfficerFinance Canada — Fiscal Reference TablesCPP Investments