Prime Minister Mark Carney promised a government that would “spend less to invest more.”
asserted
that → promise → more
Budget 2026, tabled Thursday, does neither.
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Budget → table → neither
Program spending is set to rise $44.2 billion this fiscal year, from $498.5 billion in 2025-26 to $542.7 billion in 2026-27—an 8.9 percent jump.
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spending → set → 2026
It’s what Finance Canada calls direct program expenses: departmental operations, Crown corporations, defence and the grants Ottawa hands out itself.
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Ottawa → ’ → what
That category climbs 10.7 percent, to $272.4 billion, with departmental operating and other spending alone up $19 billion, or 14.5 percent.
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category → climb → operating
The bill for all of it is always coming due.
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bill → come → it
Public debt charges rise from $53.5 billion last year to $85.5 billion by 2030–31, a 60 percent increase.
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charges → rise → 2030–31
Starting this year, Ottawa will spend more servicing its debt than it sends the provinces through the Canada Health Transfer, and by 2030–31 the gap reaches nearly $18 billion.
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gap → start → billion
Whatever this budget is, it cannot be credibly called austerity.
What a difference a year makes
The clearest test of the federal government’s restraint is to compare this budget with Carney’s first one.
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test → call → one
A year ago, Budget 2025’s fiscal plan projected program spending of $528.4 billion for 2026-27—growth of just 0.6 percent.
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plan → project → percent
Budget 2026 now puts that figure at $542.7 billion, $14.3 billion higher.
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Budget → put → billion
The gap widens in every year that follows in the latest budget compared to the previous year.
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that → widen → year
Next fiscal year, it jumps to $21.4 billion more in 2027–28, then $18.6 billion more in 2028–29, and $18 billion more in 2029–30.
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it → jump → 2029–30
Across the four years both plans cover, Ottawa now expects to spend $72.3 billion more on programs than it told Canadians a year ago.
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it → cover → Canadians
That’s after the government trimmed its own forecast.
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government → ’ → forecast
Budget 2026 lowers projected direct program spending by about $12.4 billion a year, an “aggregate forecasting adjustment” that the document says is “not attributed to particular departments, programs, or policy decisions.”
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document → lower → departments
In other words, it assumes money will go unspent, not that anything will necessarily be cut.
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anything → assume → words
Look past the red ink
Sean Speer, The Hub‘s co-founder and editor-at-large, argued in a special budget-night Hub podcast conversation that the year-over-year jump is “frankly higher than we saw from the Trudeau government,” excluding the pandemic.
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we → look → pandemic
But Speer cautioned against fixating only on the deficit.
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Speer → caution → deficit
Deficits and debt, he pointed out, are “a function of the demands on government itself [relative to] what Canadians are collectively prepared to pay.”
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Canadians → point → government
“The more important question is, what is this 9 percent growth in spending buying us?” Speer said.
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Speer → buy → us
“What are we getting for an incremental $44 billion?”
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we → get → billion
The watchdog’s warnings
Parliamentary Budget Officer Annette Ryan’s office has been flagging this pattern for months.
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office → flag → months
In its October economic and fiscal outlook, released two weeks before the budget, the PBO found that fiscal room had improved by $37.4 billion since June.
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room → release → June
New spending measures, it estimated, would cost $52.6 billion over five years, “more than offsetting the revenue improvement,” and concluded the fiscal anchors “have imposed limited fiscal discipline on government spending and borrowing.”
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anchors → estimate → spending
The PBO has also questioned whether Ottawa’s own numbers hold up.
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numbers → question → ?
Its assessment of departmental spending in the spring economic update warned that missing planning detail and “front-loaded” spending profiles raised questions about whether departments could actually deliver at the pace proposed.
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departments → warn → pace
It also noted the update gave no figures on savings or job reductions from the Comprehensive Expenditure Review for 2026–27.
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update → note → 2026–27
The forecasts also shift quickly.
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forecasts → shift → ?
The PBO’s review of the Main Estimates noted that weeks after those estimates were tabled, the spring update raised the 2026–27 forecast for elderly benefits by $6.2 billion, or 7.5 percent.
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update → note → billion
The $26.7 billion underspend in 2025–26 suggests the PBO’s capacity warning was well founded.
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warning → suggest → 2025–26
Deficits stuck, debt and interest both climbing
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interest → climb → ?
Despite the extra spending, the headline deficit looks familiar.
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deficit → look → spending
Budget 2026 projects a $62.3 billion shortfall this year, edging down to $52.9 billion by 2030–31.
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Budget → project → 2030–31
The deficit also understates how much Ottawa will borrow.
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Ottawa → understate → much
The PBO projects federal borrowing will rise $732.9 billion over five years, more than double the $333.3 billion in cumulative deficits, as Ottawa lends to Crown corporations and finances capital and defence purchases that sit off the bottom line.
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that → project → line
“We are seeing a pretty significant kind of off-the-books increase in the national debt,” Speer said, pointing to the Canada Strong Fund, Build Canada Homes, and numerous other arm’s-length vehicles.
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Speer → see → Fund
Net debt rises from $1.45 trillion last year to $1.92 trillion by 2030–31.
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debt → rise → 2030–31
Public debt charges climb from $53.5 billion to $85.5 billion over the same period, eating almost 14 cents of every revenue dollar, up from about 10 cents.
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charges → climb → cents
That’s $2.3 billion more in 2029–30 than Budget 2025 projected, and above the PBO’s own estimate of roughly $83 billion for 2030–31.
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Budget → ’ → 2030–31
…and 33 more, not listed.
The Aporia
