Prime Minister Mark Carney has delivered his first federal budget, revealing a projected deficit of C$78.3 billion for the coming fiscal year and increasing the national debt to approximately C$1.3 trillion. 

The budget documents show that the cost of servicing the debt now amounts to C$55.6 billion annually in interest payments, underscoring the growing burden of Canada’s borrowing.

Presenting the budget in the House of Commons, Finance Minister Francois‑Philippe Champagne said the government will invest significantly in infrastructure, defence and housing to “catch the winds of economic change”.

Despite those objectives, economists questioned the fiscal prudence of the strategy. One noted that even if long-term growth materializes, Canada will “still be stuck with a massive structural fiscal deficit for several years”.

Opposition leaders flagged concern that while the public hears of investment, the numbers tell a different story.

According to commentary from the Fraser Institute, the government will borrow significantly more than the previous administration committed over the next four years, effectively escalating the same accumulation of debt Canadians have faced for the past decade.

The budget projects the deficit-to-GDP ratio will rise to about 2.5 per cent this year, before beginning a gradual decline, yet the overall debt load remains elevated.

Prime Minister Carney’s government defends the higher borrowing as a necessary response to international trade pressures, including tariffs from the United States, and the need to enhance Canada’s competitiveness in a changing global economy.