Budget 2026 tabled: a $62.3 billion deficit, $142.1 billion in new measures — and no balanced year in the forecast

By The Canadian Chronicle · Friday, November 6, 2026

Politics · Federal · The Canadian Chronicle

Published Friday, November 6, 2026 · 3 min read

Finance Minister François-Philippe Champagne tabled Budget 2026 in the House of Commons on Thursday, November 5. The 511-page document, titled "Masters of Our Destiny," is the second budget under Prime Minister Mark Carney — and its own tables set the test the Chronicle's ledger has been holding since Monday.

The deficit track

The budget projects a deficit of $62.3 billion in 2026-27. That is about $3 billion lower than the spring update's projection of $65.3 billion, and $1.0 billion below the Parliamentary Budget Officer's projection of $63.3 billion.

The track then rises before it falls: $62.5 billion in 2027-28, $57.6 billion in 2028-29, $53.4 billion in 2029-30, and $52.9 billion in 2030-31. No year in the five-year forecast is balanced, and every year carries a deficit above $50 billion.

Measured against the size of the economy, the government projects the deficit falling from 1.8 per cent of gross domestic product in 2026-27 to 1.3 per cent by 2030-31. Servicing the debt costs $60.2 billion this year — about 10 cents of every tax dollar.

The new spending

The budget carries $142.1 billion in new spending and tax measures over five years. The largest single measure is the previously announced productivity mega-deduction, at $36 billion over five years, which lets businesses immediately expense a broader range of capital assets.

Higher-than-expected revenues helped pay for the package. Stronger oil prices, lifted by the war with Iran, brought in more money than the spring update expected, and the government spent much of the windfall rather than banking it against the deficit.

The budget also sets out $403.9 billion in federal capital investment over six years, inside a stated ambition to mobilize $1 trillion in total investment. The operating budget — day-to-day spending, counted separately from capital under the government's framework — is projected to balance against revenues in 2027-28, one year earlier than previously forecast.

Groceries, housing and homelessness

The budget proposes a one-time 50 per cent increase in the Canada Groceries and Essentials Benefit for the 2026-27 benefit year, with payments expected in early 2027. The supplement is worth $4.1 billion and reaches more than 12 million Canadians.

It would pay up to $339 to an eligible single person without children and up to $679 to a couple with two children. Combined with earlier increases, total support for the year reaches about $1,290 for a single person and about $2,570 for a couple with two children.

On housing, Ottawa proposes $11.2 billion over four years toward a stated goal of ending homelessness within ten years. It adds $13 billion over ten years to Build Canada Homes, putting the agency on a path to 200,000 homes over the next decade and bringing its total capitalisation to $45 billion.

Forestry and the Canada Strong Fund

The forestry sector, hit hard by U.S. tariffs, is offered $6.5 billion in spending and financing over six years. The package includes $500 million for fibre supply chains, $2 billion for equipment and facility upgrades, and $4 billion in Export Development Canada financing.

The budget also details the Canada Strong Fund announced last spring: $25 billion over three years, run as an arm's-length Crown corporation investing alongside private investors in Canadian companies and major projects.

The Record: two verdicts

The Chronicle's ledger held two checks against this budget. The first is Carney's promise to reduce both the debt-to-GDP ratio and the deficit-to-GDP ratio. On the budget's own tables, the deficit-to-GDP ratio falls every year, from 1.8 per cent to 1.3 per cent.

The debt half is contested. The PBO's fall outlook projected the debt-to-GDP ratio rising from 41.1 per cent in 2025 to 42.6 per cent by the end of the decade, on higher deficits than the budget now projects. The ledger entry stays open to the PBO's next outlook, which will judge the budget's track independently.

The second check is Champagne's November 2 promise that this budget would begin simplifying taxes for small and medium-sized businesses. The budget does carry a simplification package — the verdict and its limits are in the Chronicle's small-business coverage below.

The government holds a majority, so the budget is expected to pass. Debate on the budget and its implementation bills runs over the coming weeks.