Home Breadcrumb caret Economy Breadcrumb caret Economic Indicators PBO: Deficit on track to hit $330 billion with Covid effects lasting years Relative to the size of the economy, the deficit amounts to 15% of gross domestic product By The Canadian Press | September 29, 2020 | Last updated on September 29, 2020 1 min read 123RF The parliamentary budget office says the federal deficit for the year is on track to hit $328.5 billion as a result of Covid-19. That figure released this morning reflects measures announced as of the start of the month, including an estimated $225.9 billion in emergency aid in response to the pandemic. Relative to the size of the economy, the deficit amounts to 15% of gross domestic product, making it the largest over 50-plus years of comparable data. The Liberals said in July that the deficit would be $343.2 billion, but that didn’t include new possible spending, or measures coming in under budget. Much of the spending is expected to be temporary as the government tries to put a financial floor under households and businesses feeling economic pressure from the pandemic. Budget officer Yves Giroux says in his report that the budget deficit will fall to about $73.8 billion next year and continue to fall in ensuing fiscal years. But in a nod to how dramatically the government’s fiscal position has changed, his report estimates deficits roughly $40 billion larger each year, on average, compared to the outlook the office provided pre-pandemic. The Canadian Press The Canadian Press is a national news agency headquartered in Toronto and founded in 1917. Save Stroke 1 Print Group 8 Share LI logo