Finance Minister François-Philippe Champagne tabled Budget 2026 on November 5. Its fiscal tables project a federal deficit of $62.3 billion for 2026–27 and deficits above $50 billion in every year through 2030–31.

The most talked-about line is not the deficit. It is the cost of carrying the debt: this year, Ottawa expects to spend more on interest than it sends the provinces through the Canada Health Transfer.

  • $62.3BProjected deficit2026–27
  • $60.2BInterest on federal debt"Public debt charges," 2026–27
  • $57.4BCanada Health Transfer2026–27
  • 39.9%Federal debt to GDP2026–27
Source: Department of Finance Canada, Budget 2026, Annex 1 (Tables A1.8 and A1.10).

1. The deficit path barely moved

Since April’s Spring Economic Update, stronger revenues — which private-sector economists largely attribute to higher oil prices and inflation — improved Ottawa’s books. Most of that improvement was spent on new measures, so the projected deficits end up close to the spring plan.

Projected federal deficit, Budget 2026 vs Spring Economic Update 2026 ($ billions)
40B50B60B70B2026–272027–282028–292029–302030–31Budget 2026, 2026–27: 62.3BBudget 2026, 2027–28: 62.5BBudget 2026, 2028–29: 57.6BBudget 2026, 2029–30: 53.4BBudget 2026, 2030–31: 52.9BSpring Update 2026, 2026–27: 65.3BSpring Update 2026, 2027–28: 63.1BSpring Update 2026, 2028–29: 57.7BSpring Update 2026, 2029–30: 56.2BSpring Update 2026, 2030–31: 53.2B53.2BSpring Update 202652.9BBudget 202640B50B60B70B2026–272028–292030–31Budget 2026, 2026–27: 62.3BBudget 2026, 2027–28: 62.5BBudget 2026, 2028–29: 57.6BBudget 2026, 2029–30: 53.4BBudget 2026, 2030–31: 52.9BSpring Update 2026, 2026–27: 65.3BSpring Update 2026, 2027–28: 63.1BSpring Update 2026, 2028–29: 57.7BSpring Update 2026, 2029–30: 56.2BSpring Update 2026, 2030–31: 53.2B53.2B52.9BBudget 2026

Source: Department of Finance Canada, Budget 2026 and Spring Economic Update 2026, Annex 1. Deficits shown as positive numbers.

View the numbers as a table
PeriodBudget 2026Spring Update 2026
2026–2762.3B65.3B
2027–2862.5B63.1B
2028–2957.6B57.7B
2029–3053.4B56.2B
2030–3152.9B53.2B

The 2026–27 deficit is $3.0 billion smaller than projected in the spring. By 2030–31 the two plans differ by just $0.3 billion. Over the five years, Budget 2026 projects $288.7 billion in combined deficits.

Before the budget, the Parliamentary Budget Officer’s October outlook projected a $63.3-billion deficit for 2026–27 rising to a peak of $70.2 billion in 2027–28. That projection was based on policies in place before the budget, so it is not a direct forecast of the budget plan.

2. Interest costs pass the health transfer

Public debt charges — the interest Ottawa pays on what it has borrowed — are projected to rise from $53.5 billion in 2025–26 to $85.5 billion in 2030–31, an increase of about 60%. The Canada Health Transfer grows by about 24% over the same period, from $54.7 billion to $67.7 billion.

The two lines cross this year. By 2030–31, interest costs exceed the health transfer by $17.8 billion.

Federal interest costs vs Canada Health Transfer ($ billions)
40B60B80B2025–262026–272027–282028–292029–302030–31Public debt charges, 2025–26: 53.5BPublic debt charges, 2026–27: 60.2BPublic debt charges, 2027–28: 67.3BPublic debt charges, 2028–29: 73.8BPublic debt charges, 2029–30: 78.4BPublic debt charges, 2030–31: 85.5BCanada Health Transfer, 2025–26: 54.7BCanada Health Transfer, 2026–27: 57.4BCanada Health Transfer, 2027–28: 60.3BCanada Health Transfer, 2028–29: 62.9BCanada Health Transfer, 2029–30: 65.2BCanada Health Transfer, 2030–31: 67.7B85.5BPublic debt charges67.7BCanada Health Transfer40B60B80B2025–262027–282030–31Public debt charges, 2025–26: 53.5BPublic debt charges, 2026–27: 60.2BPublic debt charges, 2027–28: 67.3BPublic debt charges, 2028–29: 73.8BPublic debt charges, 2029–30: 78.4BPublic debt charges, 2030–31: 85.5BCanada Health Transfer, 2025–26: 54.7BCanada Health Transfer, 2026–27: 57.4BCanada Health Transfer, 2027–28: 60.3BCanada Health Transfer, 2028–29: 62.9BCanada Health Transfer, 2029–30: 65.2BCanada Health Transfer, 2030–31: 67.7B85.5B67.7B

Source: Department of Finance Canada, Budget 2026, Annex 1 (Tables A1.8 and A1.10). 2025–26 figures are Budget 2026 estimates.

View the numbers as a table
PeriodPublic debt chargesCanada Health Transfer
2025–2653.5B54.7B
2026–2760.2B57.4B
2027–2867.3B60.3B
2028–2973.8B62.9B
2029–3078.4B65.2B
2030–3185.5B67.7B

Two points of context matter here.

First, the Canada Health Transfer is not total health spending. Provinces and territories run and pay for most health care; the transfer is Ottawa’s contribution. The comparison shows how fast interest is growing relative to one large federal commitment, not that Canada spends more on interest than on health care.

Second, Finance Canada argues that debt charges remain low relative to the size of the economy. In its spring projection it put debt charges at about 1.7% of GDP for 2026–27, below the 3.2% average of the past 40 years. Both statements can be true: interest is low by historical standards as a share of GDP, and it is rising faster than most federal programs.

Measured against federal revenue, interest takes about 11 cents of every dollar in 2026–27 and nearly 14 cents by 2030–31, on Budget 2026’s projections.

3. Two ways to measure the deficit

Ottawa now reports a second figure alongside the traditional deficit: the “day-to-day operating balance.” It separates everyday program costs from spending the government classifies as capital investment, such as infrastructure and other spending it classifies as capital.

On that measure, the budget moves from a $3.5-billion operating deficit this year to a surplus from 2027–28 onward. On the full budgetary balance — the measure used in the Public Accounts — the government stays in deficit every year.

Day-to-day operating balance vs full budgetary balance ($ billions)
-70B-45B-20B5B30B2026–272027–282028–292029–302030–31Operating balance, 2026–27: -3.5BOperating balance, 2027–28: 11.2BOperating balance, 2028–29: 20.3BOperating balance, 2029–30: 24.6BOperating balance, 2030–31: 25.2BFull budgetary balance, 2026–27: -62.3BFull budgetary balance, 2027–28: -62.5BFull budgetary balance, 2028–29: -57.6BFull budgetary balance, 2029–30: -53.4BFull budgetary balance, 2030–31: -52.9B25.2BOperating balance-52.9BFull budgetary balance-70B-45B-20B5B30B2026–272028–292030–31Operating balance, 2026–27: -3.5BOperating balance, 2027–28: 11.2BOperating balance, 2028–29: 20.3BOperating balance, 2029–30: 24.6BOperating balance, 2030–31: 25.2BFull budgetary balance, 2026–27: -62.3BFull budgetary balance, 2027–28: -62.5BFull budgetary balance, 2028–29: -57.6BFull budgetary balance, 2029–30: -53.4BFull budgetary balance, 2030–31: -52.9B25.2B-52.9B

Source: Department of Finance Canada, Budget 2026, Annex 1 (Tables A1.6 and A1.8). Negative values are deficits.

View the numbers as a table
PeriodOperating balanceFull budgetary balance
2026–27-3.5B-62.3B
2027–2811.2B-62.5B
2028–2920.3B-57.6B
2029–3024.6B-53.4B
2030–3125.2B-52.9B

Supporters say the split shows that borrowing is going to long-lived assets that can raise future growth. Critics, including the Parliamentary Budget Officer, have said the government’s fiscal anchors impose limited discipline, because what counts as “capital” is a policy choice. Whether the investments raise productivity will only be visible over several years.

4. The debt grows, the ratio holds

Federal debt is projected to rise from $1.37 trillion in 2026–27 to $1.59 trillion in 2030–31. Because the economy is also projected to grow, the debt stays close to 40% of GDP throughout.

Federal debt as a share of GDP (%)
30%35%40%45%2026–272027–282028–292029–302030–31Federal debt-to-GDP, 2026–27: 39.9%Federal debt-to-GDP, 2027–28: 40.2%Federal debt-to-GDP, 2028–29: 40.4%Federal debt-to-GDP, 2029–30: 40.3%Federal debt-to-GDP, 2030–31: 40.1%40.1%30%35%40%45%2026–272028–292030–31Federal debt-to-GDP, 2026–27: 39.9%Federal debt-to-GDP, 2027–28: 40.2%Federal debt-to-GDP, 2028–29: 40.4%Federal debt-to-GDP, 2029–30: 40.3%Federal debt-to-GDP, 2030–31: 40.1%40.1%

Source: Department of Finance Canada, Budget 2026, Annex 1 (Table A1.8).

A stable ratio depends on the budget's growth projections; slower growth would push it higher.

View the numbers as a table
PeriodFederal debt-to-GDP
2026–2739.9%
2027–2840.2%
2028–2940.4%
2029–3040.3%
2030–3140.1%

5. What it means per person

Dividing by Canada’s population of about 41.8 million (Statistics Canada, July 1, 2026) puts the 2026–27 numbers on a human scale.

Budget 2026 figures per person, 2026–27 (dollars)

Source: Oh Maple Canada calculation from Budget 2026, Annex 1, and Statistics Canada population estimate for July 1, 2026 (41,798,407).

View the numbers as a table
ItemValue
Deficit1,490
Interest on federal debt1,440
Canada Health Transfer1,373

Federal debt works out to roughly $32,700 per person in 2026–27.

What the budget tables do not settle

These are projections, not results. They depend on assumptions about oil prices, interest rates, tariffs and growth that can change quickly. Higher-than-assumed interest rates would raise debt charges; a weaker economy would lower revenue.

Budget 2026 records the 2025–26 deficit at $39.3 billion. That differs from the preliminary $55.3-billion figure in Finance Canada’s March Fiscal Monitor, which was published before year-end adjustments. This article does not rely on the 2025–26 deficit figure; final results are published in the Public Accounts of Canada.

Related: Canada’s unemployment rate rises to 6.7%.