This story has been updated.
The federal deficit of $61.9 billion for 2023-24 stunned the nation when it was announced at the drama-filled 2024 federal budget. The Liberals, Conservatives and NDP have all announced plans to reduce federal debt or deficit as part of their campaign promises ahead of next week’s vote.
The Parliamentary Budget Officer estimated the baseline deficit to be $46.8 billion for the 2025-26 fiscal year and $29.1 billion for 2028-29. Here’s how each party’s promises will change that.
Liberal Party
The Liberal Party plans to introduce $129 billion of new spending and $52 billion of revenue and savings in the next four years, adding $219 billion to the federal debt over the same period.
It estimates that $20 billion of revenue will come from Canada’s response to U.S. tariffs in 2025-26, and increasing tax penalties and fines will bring in $3.75 billion by 2028-29. The bulk of its savings, $28 billion worth, comes from “increased government productivity,” but the party did not elaborate on how it achieved this figure.
Some of its largest spending measures include income tax cuts ($6.1 billion a year by 2028-29), new defence operating spending (billion a year by 2028-29) and building new homes ($2 billion a year by 2028-29).
Conservative Party
The Conservative Party intends to rake in $24 billion in revenue and find net savings of $29 billion through mainly program cuts to reduce the federal deficit from $142 billion over the next four years to $89 billion.
The Conservatives also expect $20 billion of revenue will come from Canada’s response to U.S. tariffs in 2025-26, and its effort to crack down on tax evasion and tax havens will raise $12.9 billion of revenue by the 2028-29 fiscal year.
Its promise to cut the lowest income tax rate will cost $13.7 billion in the 2028-29 fiscal year alone, so it’s also proposed a series of program cuts to reduce the deficit. It is planning to cut housing programs like the Canada Housing and Mortgage Corporation’s Housing Accelerator Fund and the federal government’s Canada Housing Infrastructure Fund; environmental regulations like carbon emissions cap and clean electricity requirements; and decrease spending on Crown Corporations and external consultants.
The Conservatives’ projections have been criticized for their reliance on economic growth in a period of global uncertainty, set off by the U.S. trade war.
NDP
The NDP’s plan will add $48.5 billion to the federal debt over a four-year mandate, bringing the federal deficit to $190 billion during that period.
The party expects to rake in $26 billion of tariff income and recover $24.8 billion by closing tax loopholes from 2025 to 2029. But its biggest revenue item would come from a proposed graduated wealth tax that would earn the government $25.1 billion per year by the 2028-29 fiscal year.
The NDP’s most expensive promises include expanding the national pharmacare plan ($12.7 billion a year by 2028-29), raising the basic personal amount ($12.5 billion a year by 2028-29) and increasing the Guaranteed Income Supplement ($3.3 billion a year by 2028-29).