Canada’s combined federal-provincial government debt estimated to surpass $2.4 trillion in 2025/26

By Jake Fuss – Fraser Institute

Budget deficits and increasing debt have become serious fiscal challenges facing the federal and many provincial governments. Since 2007/08, combined federal and provincial net debt (inflation-adjusted) has nearly doubled from $1.24 trillion to a projected $2.44 trillion in 2025/26.

Between 2019/20 (the last year before COVID) and 2025/26, the combined federal-provincial debt-to-GDP ratio is expected to grow from 65.9 percent to 75.4 percent. Moreover, the federal and provincial governments are on track to have collectively accumulated $603.7 billion (inflation-adjusted) in total net debt between 2019/20 and 2025/26, an increase of 32.8 percent.