Finance Minister François-Philippe Champagne.Spencer Colby/The Canadian Press
Finance Minister François-Philippe Champagne will release a spring economic update on April 28, providing the Liberals with their first opportunity to lay out a fiscal plan since obtaining a majority through by-elections and a series of floor-crossings.
The minister announced the date Tuesday during Question Period.
“This is going to be a plan that is going to help families. It’s going to help our industry. It’s going to help our nation, Mr. Speaker, to prosper, and to obviously bring good news to Canadians across the nation,” Mr. Champagne said.
Earlier in the day, Prime Minister Mark Carney said the update will include the government’s “next steps” to support the Canadian economy. It was his first public statement since the Liberals swept three by-elections Monday night, providing the party with a controlling majority in the House of Commons.
The government announced last year that it was reversing the traditional pattern of releasing a spring budget and a fall update.
Fiscal updates have historically been limited to updating the government’s revenue and spending forecasts in light of economic trends and recent announcements. However, in recent years, the updates have often included significant new spending and are sometimes considered mini budgets.
Mr. Champagne’s Nov. 4 budget last year projected a deficit of $78.3-billion for the fiscal year that ended March 31 and a deficit of $65.4-billion for the current fiscal year.
Some economists expect the spring update will show a bottom line that is roughly similar to the budget forecasts.
A recent survey of economists by Consensus Economics found the projected size of this year’s deficit was $64.6-billion, on average.
The Prime Minister announced Tuesday morning that the government has approved a temporary tax break on gas and diesel that will begin April 20 and remain in place until Sept. 7. The government said it is expected to shave 10 cents per litre from the cost of regular gasoline and reduce the price of diesel by four cents per litre.
The measure is projected to cost about $2.4-billion, which Mr. Carney said will be covered by an expected increase in tax revenues that Ottawa will collect from higher energy prices.
It is the second major spending announcement that Ottawa has made since the Nov. 4 budget.
Prime Minister Mark Carney says that Ottawa plans to temporarily suspend the fuel excise tax on gasoline, diesel and airplane fuel in response to the war in Iran driving up energy prices. This measure is expected to start on April 20 and run through to Labour Day.
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In January, Mr. Carney announced a five-year boost to the geared-to-income GST credit. That measure is projected to cost around $3-billion in the first year, and upward of $1-billion annually in subsequent years.
The Finance Department relies on an average forecast from private-sector economists to underpin its projections for economic growth in budget and fiscal update documents.
TD economist Andrew Hencic said the current challenge for forecasters is the uncertainty over how long the conflict in the Middle East, which is driving higher energy prices, will last.
“That’s obviously quite muddy,” he said. “When it comes to doing forecasts, this is a highly uncertain environment, and we’re doing our best. But there’s a pretty major factor going on in the background that could have impacts on the budgetary balance.”
Randall Bartlett, deputy chief economist with Desjardins, said the Nov. 4 budget figures appear to be holding up as a reliable guide.
“Deficits are shaping up to be broadly in line with what was in budget 2025,” he said. But Mr. Bartlett said that trajectory does not leave Ottawa with much room for new spending or tax cuts without putting the sustainability of federal finances at risk.
“They’re kind of walking a fine line already,” he said. “A lot of the provinces as well have seen their fiscal outlooks deteriorate, even prior to this shock. So it’s not an environment where a lot of governments in Canada have much room to work with at this point.”
During his morning news conference Tuesday, Mr. Carney said the government is putting in place a series of short- and longer-term measures that will “fundamentally” change Canada’s economy to be more independent.
“In the spring update ... you’ll see more emphasis on taking where we’re going with the economy and making sure that it benefits all Canadians,” he said.