Staying the Course: Quebec's Fiscal Balance Challenge
AbstractIn its upcoming budget, Quebec must stay on a tough road to fiscal balance.This study examines how Quebec’s fiscal balance has deteriorated. By 2009, after 10 years of balanced budgets, the province faced an unsustainable structural deficit which, if left unchecked, would reach a staggering $12 billion in 2013, increasing to $27 billion in 2019. This budgetary imbalance, says Fortin, surfaced even though Quebec’s economy performed relatively well for the last 20 years and amid the recent global crisis. To explain the budgetary slump, the author points to population aging, previous tax cuts, the multiplication of infrastructure investments, program spending growth, expected slowdown of federal transfers, and expected rising interest rates on the public debt. Professor Fortin believes Quebec’s government should stay the course on restoring budgetary balance by 2013/14, while launching healthcare reforms and promoting productivity growth by concentrating its interventions in education, access to foreign markets, competition, taxation, and public infrastructure.
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Bibliographic InfoArticle provided by C.D. Howe Institute in its journal C.D. Howe Institute Commentary.
Volume (Year): (2011)
Issue (Month): 325 (March)
Fiscal and Tax Competitiveness; Quebec government; Quebec budget;
Find related papers by JEL classification:
- H60 - Public Economics - - National Budget, Deficit, and Debt - - - General
- H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
- H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
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