{"id":477447,"date":"2026-02-19T08:09:17","date_gmt":"2026-02-19T08:09:17","guid":{"rendered":"https:\/\/www.newsbeep.com\/us\/477447\/"},"modified":"2026-02-19T08:09:17","modified_gmt":"2026-02-19T08:09:17","slug":"provinces-are-bracing-for-record-deficits-whats-causing-budgets-to-see-red","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/us\/477447\/","title":{"rendered":"Provinces are bracing for record deficits. What\u2019s causing budgets to see red?"},"content":{"rendered":"

Budget season for Canada has kicked off with three provinces already posting steep deficits<\/a>, a trend economists say is the result of several factors impacting every part of the country.<\/p>\n

\"\"<\/p>\n

On Tuesday, British Columbia unveiled their budget<\/a> that comes with a record $13.3 billion deficit<\/a> in the next fiscal year.<\/p>\n

In recent fiscal updates, New Brunswick announced a record-breaking $1.33 billion<\/a> shortfall and Nova Scotia last month said its deficit is estimated at $1.4 billion. Alberta is also forecasting a $6.4 billion shortfall for the 2025\/26 fiscal year.<\/p>\n

\u201cThe increase in deficits is something that is being experienced across the country to various extents,\u201d said Jesse Hajer, associate professor of economics at the University of Manitoba.<\/p>\n

Hajer said two of the most common factors are the high economic uncertainty given trade tensions with the U.S., and a change in immigration that is reducing the labour force and slowing economic growth.<\/p>\n

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But he added there are also specific issues different provinces are facing.<\/p>\n

He used Alberta as an example, saying oil prices are pulling down the revenue of the provincial government. Meanwhile, in Manitoba, the province is seeing what Hajer calls a \u201cstructural deficit,\u201d in which its revenue base is \u201cnot enough to keep up with funding our baseline expenditures.\u201d<\/p>\n

\u201cWhen we hit a challenging time like we are faced with today where the expectations of government are high, the revenues aren\u2019t necessarily there to support and meet those expectations,\u201d he said.<\/p>\n

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A recent report by TD Economics suggested the tone by provinces as they ready their budgets will be \u201ccautious,\u201d due to rising deficits, increasing debt burdens, and economic outlooks shaped by slower growth, trade uncertainties and spending pressures.<\/p>\n

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\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t\tNew Brunswick projects record $1.3 billion budget deficit\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\t<\/p>\n

Moshe Lander, senior lecturer in economics at Concordia University, said governments are being faced with the issue that tax revenue is not rising nearly as fast as it could, and yet people are living longer meaning governments have to spend more per person.<\/p>\n

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\u201cIf tax revenues aren\u2019t big, government spending is high, interest on the debt is high, then there is no path in which you\u2019re going to hear a government say, hey, we balanced the budget, let alone ran a surplus,\u201d Lander said.<\/p>\n

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Randall Bartlett, deputy chief economist at Desjardins, said in a report released<\/a> prior to B.C.\u2019s budget that economically, provinces have \u201cfared better\u201d than expected in their 2025 report.<\/p>\n

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This was due to economies getting a lift from historical revisions to gross domestic product published by Statistics Canada in November. That helped assuage some concerns about stagnating per capita GDP and productivity growth and put the provinces on better footing than first expected when entering the trade war with the U.S.<\/p>\n

Each province and territory took a different approach, but Bartlett said Ontario and Quebec baked a strong degree of \u201cprudence\u201d into their budgets last year and should see a relatively rosier fiscal outlook by comparison in their own upcoming updates.<\/p>\n

Lander said as deficits are announced and some provinces announce their plans, they should work to better educate people why the deficit is there as opposed to what is the dollar amount.<\/p>\n

\u201cThen they can understand that, hey, the deficit isn\u2019t necessarily bad, it should happen during bad times. I want to hear surpluses during good times. Then people can be a little more informed when they hear these numbers so that they don\u2019t have sticker shock,\u201d Lander said.<\/p>\n

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Yet as more budgets and fiscal updates are set to be announced, there is the risk of who could be impacted most.<\/p>\n

\u201cThere will be pressure now on provincial governments to find savings and to find those savings in areas of service delivery where advocates might not be as strong as in other areas,\u201d said Tom Urbaniak, political science professor at Cape Breton University.<\/p>\n

\u201cUnfortunately, that means often that people who are in the lowest socioeconomic brackets who make the least money might be affected.\u201d<\/p>\n

\u2014with files from Global News\u2019 Anna Mandin and The Canadian Press<\/p>\n

\n\t\t&copy 2026 Global News, a division of Corus Entertainment Inc.\t<\/p>\n","protected":false},"excerpt":{"rendered":"Budget season for Canada has kicked off with three provinces already posting steep deficits, a trend economists say…\n","protected":false},"author":2,"featured_media":477448,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[150,28,103,220772,101],"class_list":["post-477447","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-budget","tag-business","tag-canada","tag-deficits","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/477447","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=477447"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/477447\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/477448"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=477447"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=477447"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=477447"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}