The Fiscal Monitor: A publication of the Department of Finance

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There was a budgetary deficit of $14.9 billion in March 2019, compared to a deficit of $10.7 billion in March 2018. Revenues increased by $1.2 billion, or 4.6 per cent, primarily reflecting an increase in other revenues. Program expenses increased by $5.7 billion, or 16.4 per cent, largely reflecting increases in major transfers to other levels of government and direct program expenses. Public debt charges decreased by $0.3 billion, or 12.2 per cent, reflecting lower Consumer Price Index adjustments on Real Return Bonds.

Monthly budgetary balance

Monthly budgetary balance

For the April to March period of the 2018–19 fiscal year, the Government posted a budgetary deficit of $11.8 billion, compared to a deficit of $16.7 billion reported for the same period of 2017–18. Revenues were up $24.7 billion, or 8.1 per cent, primarily reflecting increases in tax revenues and other revenues. Program expenses were up $18.5 billion, or 6.2 per cent, reflecting increases in major transfers to persons, major transfers to other levels of government and direct program expenses. Public debt charges increased by $1.4 billion, or 6.3 per cent, reflecting a higher average effective interest rate on the stock of interest-bearing debt.

Year-to-date budgetary balance

Year-to-date budgetary balance
1 Source: Budget 2019.

Table 1
Summary statement of transactions
($ millions)

March April to March


2018
Restated1
2019 2017–18
Restated1
2018–19
Budgetary transactions
Revenues 26,577 27,797 303,527 328,256
Expenses
Program expenses -34,983 -40,708 -298,209 -316,666
Public debt charges -2,265 -1,989 -22,010 -23,396


Budgetary balance (deficit/surplus) -10,671 -14,900 -16,692 -11,806
Non-budgetary transactions 16,575 13,283 10,520 -536


Financial source/requirement 5,904 -1,617 -6,172 -12,342
Net change in financing activities -12,513 2,336 6,947 14,668


Net change in cash balances -6,609 719 775 2,326
Cash balance at end of period 37,677 40,004
Notes: Positive numbers indicate net source of funds. Negative numbers indicate net requirement for funds. 1 Certain comparative figures have been restated to reflect a change in accounting policy. See Note 8 at the end of this document for further details.

Revenues in March 2019 totalled $27.8 billion, up $1.2 billion, or 4.6 per cent, from March 2018.

For the April to March period of 2018–19, revenues were $328.3 billion, up $24.7 billion, or 8.1 per cent, from the same period the previous year.

Table 2
Revenues

March April to March


2018
Restated1
2019 Change 2017–18
Restated1
2018–19 Change
($ millions) (%) ($ millions) (%)
Tax revenues
Income taxes
Personal 12,136 12,667 4.4 146,440 155,894 6.5
Corporate 4,787 4,739 -1.0 48,199 53,636 11.3
Non-resident 574 358 -37.6 8,068 9,525 18.1


Total income tax revenues 17,497 17,764 1.5 202,707 219,055 8.1
Other taxes and duties
Goods and Services Tax 2,607 2,252 -13.6 36,988 39,127 5.8
Energy taxes 454 432 -4.8 5,749 5,757 0.1
Customs import duties 413 562 36.1 5,416 6,881 27.0
Other excise taxes and duties 414 464 12.1 5,880 6,177 5.1


Total other taxes and duties 3,888 3,710 -4.6 54,033 57,942 7.2


Total tax revenues 21,385 21,474 0.4 256,740 276,997 7.9
Employment Insurance premiums 2,519 2,747 9.1 21,091 21,923 3.9
Other revenues 2,673 3,576 33.8 25,696 29,336 14.2


Total revenues 26,577 27,797 4.6 303,527 328,256 8.1
Note: Totals may not add due to rounding. 1 Certain comparative figures have been restated to reflect a change in accounting policy. See Note 8 at the end of this document for further details.

Program expenses in March 2019 were $40.7 billion, up $5.7 billion, or 16.4 per cent, from March 2018.

Public debt charges were down $0.3 billion, or 12.2 per cent, reflecting lower Consumer Price Index adjustments on Real Return Bonds.

For the April to March period of 2018–19, program expenses were $316.7 billion, up $18.5 billion, or 6.2 per cent, from the same period the previous year.

Public debt charges increased by $1.4 billion, or 6.3 per cent, reflecting a higher average effective interest rate on the stock of interest-bearing debt.

Table 3
Expenses

March April to March


2018
Restated1
2019 Change 2017–18
Restated1
2018–19 Change
($ millions) (%) ($ millions) (%)
Major transfers to persons
Elderly benefits 4,400 4,612 4.8 50,838 53,479 5.2
Employment Insurance benefits 1,617 1,677 3.7 19,806 18,951 -4.3
Children’s benefits 1,982 1,999 0.9 23,448 23,900 1.9


Total 7,999 8,288 3.6 94,092 96,330 2.4
Major transfers to other levels of government
Canada Health Transfer 3,070 3,199 4.2 37,124 38,568 3.9
Canada Social Transfer 1,146 1,180 3.0 13,748 14,161 3.0
Equalization 1,521 1,580 3.9 18,254 18,958 3.9
Territorial Formula Financing 250 257 2.8 3,682 3,785 2.8
Gas Tax Fund 0 9 100.0 2,072 2,171 4.8
Home care and mental health 0 360 100.0 300 849 183.0
Other fiscal arrangements2 -352 -127 -63.9 -4,661 -4,738 1.7


Total 5,635 6,458 14.6 70,519 73,754 4.6
Direct program expenses
Fuel charge proceeds returned n/a 565 n/a n/a 664 n/a
Other transfer payments 9,976 12,147 21.8 44,519 50,486 13.4
Other direct program expenses 11,373 13,250 16.5 89,079 95,432 7.1


Total direct program expenses 21,349 25,962 21.6 133,598 146,582 9.7


Total program expenses 34,983 40,708 16.4 298,209 316,666 6.2
Public debt charges 2,265 1,989 -12.2 22,010 23,396 6.3


Total expenses 37,248 42,697 14.6 320,219 340,062 6.2
Note: Totals may not add due to rounding. 1 Certain comparative figures have been restated to reflect a change in accounting policy. See Note 8 at the end of this document for further details. 2Other 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

March April to March


2018 2019 Change 2017-18 2018-19 Change
($ millions) (%) ($ millions) (%)
Transfer payments 23,610 27,458 16.3 209,130 221,234 5.8
Other expenses
Personnel 5,573 5,502 -1.3 53,261 55,613 4.4
Transportation and communications 543 633 16.6 2,778 3,031 9.1
Information 114 130 14.0 324 389 20.1
Professional and special services 3,085 3,067 -0.6 12,384 12,673 2.3
Rentals 406 500 23.2 2,996 3,269 9.1
Repair and maintenance 892 808 -9.4 3,360 3,575 6.4
Utilities, materials and supplies 477 471 -1.3 2,636 2,732 3.6
Other subsidies and expenses -93 1,398 1,603.2 6,412 8,812 37.4
Amortization of tangible capital assets 352 658 86.9 4,782 5,124 7.2
Net loss on disposal of assets 24 83 245.8 146 214 46.6


Total other expenses 11,373 13,250 16.5 89,079 95,432 7.1


Total program expenses 34,983 40,708 16.4 298,209 316,666 6.2
Public debt charges 2,265 1,989 -12.2 22,010 23,396 6.3


Total expenses 37,248 42,697 14.6 320,219 340,062 6.2
Note: Totals may not add due to rounding.

Revenues and expenses (April 2018 to March 2019)

Revenues and expenses (April 2018 to March 2019) - 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 deficit of $11.8 billion and a requirement of $0.5 billion from non-budgetary transactions, there was a financial requirement of $12.3 billion for the April 2018 to March 2019 period, compared to a financial requirement of $6.2 billion for the same period the previous year.

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

March April to March


2018
Restated1
2019 2017–18
Restated1
2018–19
Budgetary balance (deficit/surplus) -10,671 -14,900 -16,692 -11,806
Non-budgetary transactions
Accounts payable, accrued liabilities and
accounts receivable
14,351 11,489 9,232 7,665
Pensions, other future benefits, and other liabilities -132 650 6,050 7,597
Foreign exchange accounts 4,152 498 1,860 -2,751
Loans, investments and advances 309 2,215 -3,668 -9,554
Non-financial assets -2,105 -1,569 -2,954 -3,493


Total non-budgetary transactions 16,575 13,283 10,520 -536


Financial source/requirement 5,904 -1,617 -6,172 -12,342
Note: Totals may not add due to rounding. 1 Certain comparative figures have been restated to reflect a change in accounting policy. See Note 8 at the end of this document for further details.

The Government financed this financial requirement of $12.3 billion and increased cash balances by $2.3 billion by increasing unmatured debt by $14.7 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 March 2019 stood at $40.0 billion, up $2.3 billion from their level at the end of March 2018.

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

March April to March


2018 2019 2017–18 2018–19
Financial source/requirement 5,904 -1,617 -6,172 -12,342
Net increase (+)/decrease (-) in financing activities
Unmatured debt transactions
Canadian currency borrowings
Marketable bonds -3,898 -2,943 38,715 -5,407
Treasury bills -4,200 4,500 -26,000 23,600
Retail debt -66 -46 -1,948 -1,349


Total -8,164 1,511 10,767 16,844
Foreign currency borrowings -4,333 35 -1,560 -39


Total -12,497 1,546 9,207 16,805
Cross-currency swap revaluation 488 695 71 -561
Unamortized discounts and premiums on market debt -97 -16 -1,855 -1,304
Obligations related to capital leases and other unmatured debt -407 111 -476 -272


Net change in financing activities -12,513 2,336 6,947 14,668
Change in cash balance -6,609 719 775 2,326
Cash balance at end of period 37,677 40,004
Note: Totals may not add due to rounding.

The federal debt, or accumulated deficit, is the difference between the Government's total liabilities and total assets. The year-over-year change in the accumulated deficit reflects the year-to-date budgetary balance plus other comprehensive income or loss. Other comprehensive income or loss represents certain unrealized gains and losses on financial instruments and certain actuarial gains and losses related to pensions and other employee future benefits reported by enterprise Crown corporations and other government business enterprises.

The federal debt increased by $12.0 billion over the April 2018 to March 2019 period, reflecting the $11.8-billion budgetary deficit and $0.2 billion in other comprehensive losses.

Table 7
Condensed statement of assets and liabilities
($ millions)

March 31,
2018
Restated2
March 31,
2019
Change
Liabilities
Accounts payable and accrued liabilities 148,733 157,239 8,506
Interest-bearing debt
Unmatured debt
Payable in Canadian currency
Marketable bonds 574,968 569,561 -5,407
Treasury bills 110,700 134,300 23,600
Retail debt 2,586 1,237 -1,349

Subtotal 688,254 705,098 16,844
Payable in foreign currencies 16,049 16,010 -39
Cross-currency swap revaluation 7,835 7,274 -561
Unamortized discounts and premiums on market debt 3,467 2,163 -1,304
Obligations related to capital leases and other unmatured debt 5,596 5,324 -272

Total unmatured debt 721,201 735,869 14,668
Pension and other liabilities
Public sector pensions 170,914 168,817 -2,097
Other employee and veteran future benefits 104,793 114,244 9,451
Other liabilities 5,670 5,913 243

Total pension and other liabilities 281,377 288,974 7,597

Total interest-bearing debt 1,002,578 1,024,843 22,265

Total liabilities 1,151,311 1,182,082 30,771
Financial assets
Cash and accounts receivable 172,991 176,160 3,169
Foreign exchange accounts 96,938 99,689 2,751
Loans, investments, and advances
(net of allowances)1
126,371 135,693 9,322
Public sector pension assets 2,124 2,124 0

Total financial assets 398,424 413,666 15,242

Net debt 752,887 768,416 15,529
Non-financial assets 81,633 85,126 3,493

Federal debt (accumulated deficit) 671,254 683,290 12,036
Note: Totals may not add due to rounding. 1 March 31, 2019 amount includes $0.2 billion in other comprehensive losses from enterprise Crown corporations and other government business enterprises for the April 2018 to March 2019 period. 2 Certain March 31, 2018 balances have been restated to reflect a change in the Government's accounting for the Canadian Commercial Corporation. This restatement has resulted in a $6,091-million decrease in accounts payable and accrued liabilities, a $215-million decrease in cash and accounts receivable, and a $5,876-million decrease in non-financial assets, with no overall impact on the federal debt. See Note 8 at the end of this document for further details.
  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.
  8. Accounting Changes and Restatement

    The monthly financial results for 2017–18 presented for comparative purposes in The Fiscal Monitor have been restated to reflect the following two changes in accounting policy.

    Change in Discount Rate Methodology

    In finalizing its 2017–18 annual financial results, the Government implemented a change in the discount rate methodology used in valuing unfunded pension obligations. This change resulted in a $0.5-billion increase in the 2017–18 budgetary deficit. Further details regarding this accounting policy change can be found in Note 3 to the condensed consolidated financial statements in the Annual Financial Report of the Government of Canada 2017–2018, available on the Department of Finance Canada website.

    Canadian Commercial Corporation

    For the 2018–19 fiscal year, the Canadian Commercial Corporation has determined that it acts as an agent in its commercial trading transactions. As a result, the revenues and expenses and related asset and liability balances arising from these transactions are no longer consolidated in the Government's financial results. This accounting change has no net impact on the budgetary balance, as the decline in the Government's revenues is offset by an equal reduction in expenses. Similarly, this change has no net impact on the federal debt, as the decrease in the Government's assets is offset by an equal reduction in its liabilities. The March 31, 2018 Condensed Statement of Assets and Liabilities shown in Table 7 has been adjusted to reflect the retroactive impact of this change.

    The following table provides an overview of these restatements of the 2017–18 financial results.

Table 8
Summary of Restatements
($ millions)

Program expenses Public debt charges Other revenues Budgetary balance (deficit/surplus) Non-budgetary transactions
March 2018
As previously reported -34,922 -2,456 2,845 -10,629 16,533
Effect of change in accounting policy
Change in discount rate methodology -233 191 n/a -42 42
Canadian Commercial Corporation 172 n/a -172 0 n/a

As restated -34,983 -2,265 2,673 -10,671 16,575

April 2017 to March 2018
As previously reported -297,801 -24,302 28,084 -16,188 10,016
Effect of change in accounting policy
Change in discount rate methodology -2,796 2,292 n/a -504 504
Canadian Commercial Corporation 2,388 n/a -2,388 0 n/a

As restated -298,209 -22,010 25,696 -16,692 10,520

Note: Totals may not add due to rounding.

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.

May 2019

© Her Majesty the Queen in Right of Canada (2019)

All rights reserved

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

Cette publication est également disponible en français.

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

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