Archived - Revised - The Fiscal Monitor A publication of the Department of Finance: 2018-06

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Please note changes in Table 4 (shown in red).

There was a budgetary surplus of $1.1 billion in June 2018, compared to a surplus of $16 million in June 2017. Revenues increased by $2.2 billion, or 8.6 per cent, reflecting increases in income tax revenues, Employment Insurance (EI) premium revenues and other revenues. Program expenses increased by $0.9 billion, or 3.9 per cent, reflecting increases in major transfers to persons and other levels of government and direct program expenses. Public debt charges increased by $0.2 billion, or 8.6 per cent, reflecting in part a higher average effective interest rate on the stock of Government of Canada treasury bills.

Monthly budgetary balance

Monthly budgetary balance

For the April to June 2018 period of the 2018–19 fiscal year, the Government posted a budgetary surplus of $4.3 billion, compared to a surplus of $0.1 billion reported in the same period of 2017–18. Revenues were up $6.5 billion, or 8.6 per cent, reflecting increases in tax revenues, EI premium revenues and other revenues. Program expenses were up $1.6 billion, or 2.3 per cent, reflecting increases in major transfers to persons and other levels of government and direct program expenses. Public debt charges were up $0.7 billion, or 11.1 per cent, reflecting higher Consumer Price Index adjustments on Real Return Bonds and a higher average effective interest rate on the stock of Government of Canada treasury bills.

The financial results for the first three months of the fiscal year provide limited information with respect to the outlook for the year as a whole. That being said, the financial results through the April to June 2018 period are broadly in line with the fiscal projection for 2018–19 presented in the budget as expenses are expected to be concentrated later in the fiscal year, consistent with prior-year trends.

An update of the economic and fiscal outlook will be provided in the Fall Economic Statement.

Year-to-date budgetary balance

Year-to-date budgetary balance
1 Source: Budget 2018.

Table 1
Summary statement of transactions
($ millions)

June April to June


2017 2018 2017–18 2018–19
Budgetary transactions
Revenues 24,977 27,132 75,270 81,774
Expenses
Program expenses -22,924 -23,809 -69,068 -70,688
Public debt charges -2,037 -2,213 -6,119 -6,800


Budgetary balance (deficit/surplus) 16 1,110 83 4,286
Non-budgetary transactions -2,271 -8,243 -16,461 -11,181


Financial source/requirement -2,255 -7,133 -16,378 -6,895
Net change in financing activities -879 -7,214 21,945 5,909


Net change in cash balances -3,134 -14,347 5,567 -986
Cash balance at end of period 42,469 36,691
Notes: Positive numbers indicate net source of funds. Negative numbers indicate net requirement for funds.

Revenues in June 2018 totalled $27.1 billion, up $2.2 billion, or 8.6 per cent, from June 2017.

For the April to June period of 2018–19, revenues were $81.8 billion, up $6.5 billion, or 8.6 per cent, from the same period the previous year.

Table 2
Revenues

June April to June


2017 2018 Change 2017–18 2018–19 Change
($ millions) (%) ($ millions) (%)
Tax revenues
Income taxes
Personal 11,546 12,433 7.7 35,024 37,743 7.8
Corporate 3,889 5,253 35.1 11,070 13,642 23.2
Non-resident 498 650 30.5 1,611 2,063 28.1


Total income tax revenues 15,933 18,336 15.1 47,705 53,448 12.0
Other taxes and duties
Goods and Services Tax 3,286 2,763 -15.9 9,838 10,132 3.0
Energy taxes 361 441 22.2 1,229 1,320 7.4
Customs import duties 502 455 -9.4 1,383 1,314 -5.0
Other excise taxes and duties 535 567 6.0 1,465 1,548 5.7


Total other taxes and duties 4,684 4,226 -9.8 13,915 14,314 2.9


Total tax revenues 20,617 22,562 9.4 61,620 67,762 10.0
Employment Insurance premiums 1,937 2,054 6.0 6,286 6,625 5.4
Other revenues 2,423 2,516 3.8 7,364 7,387 0.3


Total revenues 24,977 27,132 8.6 75,270 81,774 8.6
Note: Totals may not add due to rounding.

Program expenses in June 2018 were $23.8 billion, up $0.9 billion, or 3.9 per cent, from June 2017.

Public debt charges were up $0.2 billion, or 8.6 per cent, reflecting in part a higher average effective interest rate on the stock of Government of Canada treasury bills.

For the April to June period of 2018–19, program expenses were $70.7 billion, up $1.6 billion, or 2.3 per cent, from the same period the previous year.

Public debt charges increased by $0.7 billion, or 11.1 per cent, reflecting higher Consumer Price Index adjustments on Real Return Bonds and a higher average effective interest rate on the stock of Government of Canada treasury bills.

Table 3
Expenses

June April to June


2017 2018 Change 2017–18 2018–19 Change
($ millions) (%) ($ millions) (%)
Major transfers to
persons
Elderly benefits 4,160 4,361 4.8 12,404 13,024 5.0
Employment Insurance
benefits
1,358 1,254 -7.7 4,954 4,373 -11.7
Children’s benefits 1,981 2,033 2.6 5,894 6,110 3.7


Total 7,499 7,648 2.0 23,252 23,507 1.1
Major transfers to other
levels of government
Canada Health Transfer 3,096 3,215 3.8 9,287 9,646 3.9
Canada Social Transfer 1,146 1,180 3.0 3,437 3,540 3.0
Equalization 1,521 1,580 3.9 4,563 4,740 3.9
Territorial Formula
Financing
251 257 2.4 1,429 1,469 2.8
Gas Tax Fund 0 0 n/a 0 0 n/a
Home care and mental
health
n/a 0 n/a n/a 17 n/a
Other fiscal
arrangements1
-397 -416 4.8 -1,189 -1,248 5.0


Total 5,617 5,816 3.5 17,527 18,164 3.6
Direct program expenses
Other transfer payments 2,816 3,082 9.4 8,483 8,486 0.0
Other direct program
expenses
6,992 7,263 3.9 19,806 20,531 3.7


Total direct program
expenses
9,808 10,345 5.5 28,289 29,017 2.6


Total program expenses 22,924 23,809 3.9 69,068 70,688 2.3
Public debt charges 2,037 2,213 8.6 6,119 6,800 11.1


Total expenses 24,961 26,022 4.3 75,187 77,488 3.1
Note: Totals may not add due to rounding. 1 Other fiscal arrangements include the Youth Allowances Recovery and Alternative Payments for Standing Programs, which represent a recovery from Quebec of a tax point transfer; statutory subsidies; payments under the 2005 Offshore Accords; and payments to provinces in respect of common securities regulation.

The following table presents total expenses by main object of expense.

Table 4
Total expenses by object of expense

June April to June


2017 2018 Change 2017-18 2018-19 Change
($ millions) (%) ($ millions) (%)
Transfer payments 15,932 16,546 3.9 49,262 50,157 1.8
Other expenses
Personnel 4,125 4,219 1.5 11,733 12,502 6.3
Transportation and communications 231 252 9.1 486 541 11.3
Information 20 15 -25.0 37 40 8.1
Professional and special services 784 821 8.8 1,634 1,684 5.0
Rentals 163 201 23.3 735 782 6.4
Repair and maintenance 196 231 17.9 382 411 7.6
Utilities, materials and supplies 210 199 -5.2 514 510 -0.8
Other subsidies and expenses 865 934 8.0 3,048 2,831 -7.1
Amortization of tangible capital assets 385 374 -2.9 1,209 1,196 -1.1
Net loss on disposal of assets 13 17 30.8 28 34 21.4


Total other expenses 6,992 7,263 3.9 19,806 20,531 3.7


Total program expenses 22,924 23,809 3.9 69,068 70,688 2.3
Public debt charges 2,037 2,213 8.6 6,119 6,800 11.1


Total expenses 24,961 26,022 4.3 75,187 77,488 3.1
Note: Totals may not add due to rounding.

Revenues and expenses (April to June 2018)

Revenues and expenses (April to June 2018) - For details, refer to preceding paragraphs.
Note: Totals may not add due to rounding.

The budgetary balance is presented on an accrual basis of accounting, recording government revenues and expenses when they are earned or incurred, regardless of when the cash is received or paid. In contrast, the financial source/requirement measures the difference between cash coming in to the Government and cash going out. This measure is affected not only by changes in the budgetary balance but also by the cash source/requirement resulting from the Government's investing activities through its acquisition of capital assets and its loans, financial investments and advances, as well as from other activities, including payment of accounts payable and collection of accounts receivable, foreign exchange activities, and the amortization of its tangible capital assets. The difference between the budgetary balance and financial source/requirement is recorded in non-budgetary transactions.

With a budgetary surplus of $4.3 billion and a requirement of $11.2 billion from non-budgetary transactions, there was a financial requirement of $6.9 billion for the April to June 2018 period, compared to a financial requirement of $16.4 billion for the same period the previous year.

Table 5
The budgetary balance and financial source/requirement
($ millions)

June April to June


2017 2018 2017–18 2018–19
Budgetary balance (deficit/surplus) 16 1,110 83 4,286
Non-budgetary transactions
Accounts payable, accrued liabilities and
accounts receivable
-11,028 -5,523 -18,916 -10,147
Pensions, other future benefits, and other liabilities 302 667 535 1,457
Foreign exchange accounts 5,022 -2,774 -60 -316
Loans, investments and advances 3,401 -602 1,615 -2,387
Non-financial assets 32 -11 365 212


Total non-budgetary transactions -2,271 -8,243 -16,461 -11,181


Financial source/requirement -2,255 -7,133 -16,378 -6,895
Note: Totals may not add due to rounding.

The Government financed this financial requirement of $6.9 billion by decreasing cash balances by $1.0 billion and increasing unmatured debt by $5.9 billion. The increase in unmatured debt was achieved primarily through the issuance of treasury bills.

The level of cash balances varies from month to month based on a number of factors including periodic large debt maturities, which can be quite volatile on a monthly basis. Cash balances at the end of June 2018 stood at $36.7 billion, down $5.8 billion from their level at the end of June 2017.

Table 6
Financial source/requirement and net financing activities
($ millions)

June April to June


2017 2018 2017–18 2018–19
Financial source/requirement -2,255 -7,133 -16,378 -6,895
Net increase (+)/decrease (-) in financing activities
Unmatured debt transactions
Canadian currency borrowings
Marketable bonds -10 -4,059 9,703 -2,109
Treasury bills 3,400 -4,600 13,800 8,600
Retail debt 71 -29 -75 -114


Total 3,461 -8,688 23,428 6,377
Foreign currency borrowings -855 706 32 523


Total 2,606 -7,982 23,460 6,900
Cross-currency swap revaluation -3,167 846 -1,035 -367
Unamortized discounts and premiums on market debt -267 -32 -375 -520
Obligations related to capital leases and
other unmatured debt
-51 -46 -105 -104


Net change in financing activities -879 -7,214 21,945 5,909
Change in cash balance -3,134 -14,347 5,567 -986
Cash balance at end of period 42,469 36,691
Note: Totals may not add due to rounding.
  1. The Fiscal Monitor is a report on the consolidated financial results of the Government of Canada, prepared monthly by the Department of Finance Canada. The Government is committed to releasing The Fiscal Monitor on a timely basis in accordance with the International Monetary Fund's Special Data Dissemination Standard Plus, which is designed to promote member countries' data transparency and promote the development of sound statistical systems.
  2. The financial results reported in The Fiscal Monitor are drawn from the accounts of Canada, which are maintained by the Receiver General and used to prepare the annual Public Accounts of Canada.
  3. The Fiscal Monitor is generally prepared in accordance with the same accounting policies as used to prepare the Government's annual consolidated financial statements, which are summarized in Section 2 of Volume I of the Public Accounts of Canada, available through the Public Services and Procurement Canada website.
  4. The financial results presented in The Fiscal Monitor have not been audited or reviewed by an external auditor.
  5. There can be substantial volatility in monthly results due to the timing of revenue receipts and expense recognition. For instance, a large share of government spending is typically reported in the March Fiscal Monitor.
  6. The April to March results reported in The Fiscal Monitor are not the final results for the fiscal year as a whole. The final results are published in the annual Public Accounts of Canada and incorporate post-March end-of-year adjustments made once further information becomes available, including the accrual of tax revenues reflecting assessments of tax returns and valuation adjustments for assets and liabilities. Post-March adjustments may also include the accrual of measures announced in the budget that are recorded upon receipt of Royal Assent of enabling legislation.
  7. Table 7, Condensed Statement of Assets and Liabilities, is included in the monthly Fiscal Monitor following the finalization and publication of the Government's financial results for the preceding fiscal year, typically in the fall.

Note: Unless otherwise noted, changes in financial results are presented on a year-over-year basis.

For inquiries about this publication, contact Bradley Recker at 613-369-5667.

August 2018

© Her Majesty the Queen in Right of Canada (2018)

All rights reserved

All requests for permission to reproduce this document or any part thereof shall be addressed to the Department of Finance Canada.

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Cat. No.: F12-4E-PDF
ISSN: 1487-0134

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