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Finance Minister François-Philippe Champagne says the government will table its latest budget on Nov. 5.
This will be the second budget under Prime Minister Mark Carney and the second consecutive budget to be introduced in the fall.
Prior to last year, the federal financial plan had typically been introduced in the spring. But Carney decided to switch to a fall tabling last year.
Champagne announced the timing of this year’s budget during Tuesday’s question period.
The government’s spring economic update, introduced in April, showed a lower deficit for the last fiscal year than the previous budget forecast. The 2025 budget had originally pegged the deficit for 2025-26 at $78.3 billion. But April’s update projected the deficit at $66.9 billion.
Surging oil prices in part contributed to the windfall in the spring update. For the current fiscal year, April’s update had projected a $65-billion deficit for the current fiscal year.
Champagne’s announcement comes the same day that the Parliamentary Budget Office (PBO) trimmed its outlook for economic growth for this year and next.
In a revised outlook on Tuesday, the federal budget watchdog said it now projects real gross domestic product growth of 0.9 per cent for this year and 1.5 per cent in 2027.
The forecast is down from estimated growth of 1.1 per cent and 1.6 per cent, respectively, issued in June.
Annette Ryan, the parliamentary budget officer, pointed to “additional trade measures and ongoing uncertainty” as the reason for the revised outlook.
Since the PBO’s last forecast, trade talks between Canada and the U.S. collapsed and both countries slapped new rounds of tariffs on certain imports.
The PBO said it also now projects a budgetary deficit of $63.3 billion for the 2026-27 fiscal year, which will peak at $70.2 billion in 2027-28.
Parliamentary Budget Officer Annette Ryan prepares to appear at the Standing Committee on Government Operations and Estimates on Parliament Hill in Ottawa, on Tuesday, June 16, 2026. (Justin Tang/The Canadian Press)
Relative to its June outlook, the deficits are $3 billion higher per year on average over 2026‑27 to 2030‑31, as new spending measures more than offset stronger revenues, the watchdog said.
While the latest forecasts don’t show a path to balancing the overall budget, Carney has promised to balance the “operating budget,” or how much the government spends on running day-to-day operations.
Originally the prime minister said the government would balance that portion of the budget by 2028. But Carney announced in September that the government would hit an operating balance in 2027, a year ahead of schedule.
But the PBO released a report last month that projects Ottawa will instead hit that marker a year late, in fiscal 2029-30.
The PBO has also flagged inconsistencies in how government departments define operational spending versus investment spending.
Inflation creeping up
The budget will be presented as the inflation rate has crept back up in recent months.
Canada’s annual inflation rate rose to 3.1 per cent in September, Statistics Canada said on Monday — 0.1 per cent higher compared to August. StatsCan attributed the increase in the inflation rate to higher fuel prices. Excluding gasoline, consumer prices increased 2.2 per cent year-over-year in September.
The PBO said Tuesday that it assumes the Bank of Canada will start raising its policy rate in early 2027 “to keep inflation expectations anchored,” reaching 2.75 per cent by mid-year.
On inflation, the watchdog expects higher energy prices will keep the annual inflation rate elevated in 2026, averaging 2.8 per cent, before easing to 2.4 per cent in 2027.
The Bank of Canada’s target rate for inflation is between 1 and 3 per cent.
