Canada December budget gap up slightly; fiscal year-to-date down

Fri Feb 22, 2013 11:42am EST
 

By Randall Palmer

OTTAWA (Reuters) - Canada's federal budget gap widened slightly in December from a year earlier, but the deficit for the first nine months of the fiscal year was still down 19 percent, the finance department said on Friday.

The monthly Fiscal Monitor said the government spent C$572 million ($561 million) more in December than it took in. The gap in December 2011 was C$538 million .

For the period April to December, the deficit shrank to C$12.99 billion from C$16.06 billion in the same period in 2011. This amounts to a fraction of the budget deficits in other leading Western countries after adjusting for the size of the economies.

Finance Minister Jim Flaherty says he plans to balance the budget by 2015, although he has conceded the heavily discounted price for Canadian crude oil is hurting government revenues.

Government revenues rose in December from a year earlier, but the 2.8 percent increase was smaller than the 3.8 percent rise in program expenses.

In his November fiscal update, Flaherty projected a deficit for the 2012-13 fiscal year of C$26.0 billion, including an adjustment for risk. For the year that will start April 2013, he forecast a deficit of C$16.5 billion.

(Editing by Jeffrey Hodgson; and Peter Galloway)

 
Canada's Finance Minister Jim Flaherty speaks during Question Period in the House of Commons on Parliament Hill in Ottawa February 12, 2013. REUTERS/Chris Wattie