Canada Posts Budget Surplus
August 28 2015 - 2:00PM
Dow Jones News
OTTAWA—Canada recorded a budget surplus of 5.01 billion Canadian
dollars (US$3.79 billion) in the first three months of the current
fiscal year, leading Prime Minister Stephen Harper, who is seeking
a fourth straight mandate from Canadian voters, to say his economic
plan is working.
The April-to-June surplus was much higher than the C$424 million
surplus recorded in the same period in 2014, and "consistent" with
the government's projections for a small surplus this fiscal year,
the country's finance department said Friday. The surplus in the
latest period was boosted by Canada's sale of shares in General
Motors Co., which it had acquired as part of the U.S.-Canada
financial rescue of the auto sector in 2009.
The issue of fiscal discipline has emerged as a major theme in a
national election campaign in Canada. Mr. Harper has made the
return to a budget surplus a centerpiece of his Conservative
Party's economic platform leading to the Oct. 19 vote. Canada built
up a large deficit to finance the country's recession-fighting
stimulus plan in 2009. The left-leaning New Democratic Party has
also vowed to run balanced budgets, while the Liberal Party says it
would boost infrastructure spending to stoke growth, which it says
would mean annual deficits of up to C$10 billion for the next two
fiscal years before a return to balance in 2019.
"While the global economy remains volatile, our Conservative
government will continue to deliver a low-tax, balanced budget plan
to keep our economy moving forward," Mr. Harper said in a statement
Friday.
The results for the first quarter of fiscal 2015-16 "are
consistent with the fiscal projection" presented in the
government's budget plan, which envisages a C$1.4 billion surplus
this fiscal year, the finance department said in its monthly Fiscal
Monitor report.
Doubts about the likelihood of a surplus have emerged amid
slower-than-anticipated growth and the drop in the price of crude
oil, Canada's top export. Canada's budget watchdog said in a report
last month the Conservative government's promise of a balanced
budget could be delayed by a year because of weakening economic
conditions.
Canada's budget surplus in June was C$1.01 billion, down from
C$1.57 billion in June 2014, according to the Fiscal Monitor.
Revenue rose 2.6% in June but expenses climbed 8.2% due to costs
associated with a new national benefits program for households with
children. That cost increase was offset in June by a 20.3% decline
in public-debt charges, which the department said reflected lower
inflation adjustments on real-return bonds and lower rates on its
stock of interest-bearing debt.
Write to Paul Vieira at paul.vieira@wsj.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
August 28, 2015 14:45 ET (18:45 GMT)
Copyright (c) 2015 Dow Jones & Company, Inc.
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