Ottawa, September 25, 2006
2006-047
Related documents:
Backgrounder: Effective Spending
Backgrounder: Annual Financial Report
2005-06
Annual Financial Report of the Government of Canada
Fiscal Year 20052006
Fiscal Reference Tables, September 2006
The Honourable Jim Flaherty, Minister of Finance and the Honourable John
Baird, President of the Treasury Board, today announced that Canada's New
Government has eliminated wasteful and ineffective programs, reduced
government spending and paid down the national debt.
"We are trimming the fat and refocusing spending on the priorities of
Canadians," said Minister Baird. "Our government is also keeping its
promise to families and taxpayers by reducing the national debt."
Minister Baird confirmed that a strategy is in place to secure $1 billion
in savings this year and next as promised in the spring budget. The savings
are being identified in government program spending as well as through
tighter management.
"We are saving $15 million by having settled the softwood lumber deal",
explains Minister Baird. "The previous government never believed it could
get the deal done, so it had set large amounts of money aside to pay lawyers".
Canada's New Government is also reducing the national debt by $13.2 billion,
one of the largest debt reductions in Canadian history. Minister Flaherty
explained that this debt reduction is the result of strong revenue growth,
reflecting the strength of the economy, and lower-than-expected program
expenses.
"In fact, this is the first time in nine years that program spending
has actually declined," said Minister Flaherty. "We have been able to
reduce the debt, cut taxes and invest more resources in programs that are
important to ordinary Canadians such as child care and safer streets. This
is possible in part because we have put an end to the previous government's
end-of-year spending spree. Our government has adopted an approach that is
responsible, accountable and inspired by a clear sense of priorities,"
added Minister Flaherty.
Canada's federal debt at the end of 2005-06 is now $481.5 billion, down
$81.4 billion from its peak of $562.9 billion in 1996-97. Federal debt as a
percentage of gross domestic product (GDP) is now at its lowest level in 24
years. Owing to Canada's New Government's commitment to on-going debt
reduction, the country's debt load is set to shrink further in years
ahead.
Information about the $13.2 billion surplus is contained in the Annual
Financial Report of the Government of Canada, which was released today and
reviews the government's financial performance for the 200506 fiscal
year.
____________________________________
For further information, media may contact:
Eric Richer
Press Secretary
Office of the Minister of Finance
613-996-7861
David Gamble
Media Relations
Department of Finance
613-996-8080
Patrick Robert
Press Secretary
Office of the President of the Treasury Board
(613) 957-2666
Robert Makichuk
Chief, Media Relations
Treasury Board of Canada Secretariat
(613) 957-2391
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Backgrounder
Annual Financial Report 2005-06
A budgetary surplus of $13.2 billion was achieved in 200506.
As a result, the federal debt is down $561 for each Canadian.
The surplus reduces the federal debt, which stood at
$481.5 billion at the end of fiscal 200506, down $81.4 billion from
its peak of $562.9 billion in 1996-97.
Program spending was down $1.1 billion from the previous
year the first year-over-year decline in nine years.
The Government has received a clean opinion on its
2005-06 financial statements from the Auditor General. In addition, the
Government has addressed some long-standing concerns of the Auditor
General about the financial statements, including the accounting
treatment of foundations.
The surplus was $5.2 billion higher than the $8-billion
surplus forecast in Budget 2006, due primarily to program expenses
coming in lower than projected:
Revenues came in almost exactly as expected, except
for a one-time $1-billion change in accounting treatment for IMF
subscriptions made after discussions with the Auditor General.
Of the $3.9-billion decrease in program spending from
that estimated in the Budget, $1.4 billion was due to lower year-end
spending by departments, in part reflecting the tighter control over
spending by this Government. The rest ($2.5 billion) was due to
year-end accrual adjustments.
___________________________________
For further information, media may contact:
Eric Richer
Press Secretary
Office of the Minister of Finance
613-996-7861
David Gamble
Media Relations
Department of Finance
613-996-8080
