The majority of the efforts to achieve a balanced budget will fall into the court of the next government, according to the Auditor General of Quebec’s analysis of the 2026 pre-election report, unveiled Monday.
Quebec will have to tighten its belt to comply with the Balanced Budget Act, which requires the deficit to be stopped by 2029-2030.
The next government will have to make budgetary efforts of $2 billion next year to stay on course towards a balanced budget. The following year, the fiscal framework provides for a $3 billion effort, in addition to a $1.85 billion gap to be absorbed.
“I would say that the most important efforts to achieve a balanced budget are devoted to 2028-2029 and 2029-2030,” replied Auditor General Christine Roy at a press conference.
“More than 70 per cent of the measures will have to be put in place in the last two years of the plan to return to a balanced budget,” she continues.
The auditor general acknowledges that political parties do not have “much room for manoeuvre” for new promises in their budget frameworks.
“It’s up to the political parties to decide if they want to make additional measures, but at that point, they have to explain how they’re going to finance them,” she says.
“Electoral sweets” denounced
While Finance Minister Eric Girard says Quebec’s fiscal situation is improving compared to his ministry’s previous forecasts, the Liberal Party (QLP) and the Parti Québécois (PQ) accuse the Coalition Avenir Québec (CAQ) government of leaving public finances in poor shape before the next election.
Liberal public finance critic Frédéric Beauchemin accuses Premier Christine Fréchette of making a series of pre-election announcements, despite the deficit. “She was aware of the state of public finances.”
The Parti Québécois (PQ) critic for government efficiency, Pascal Paradis, also accuses the premier of being a spendthrift after winning the leadership race last spring.
“Christine Fréchette continued to have both hands in the dish of electoral candy to promise billions at all costs, when that is the financial situation of Quebec,” denounces Paradis.
Girard acknowledges that Fréchette has promised $2.3 billion in new measures over five years. This is a little more than the $1 billion envelope that was provided for this purpose in last spring’s budget.
However, the budgetary situation has been better than the ministry’s forecasts, which has given the premier more room for manoeuvre, he defends. “We have only used part of this improvement,” he replies.
Pressure on services
Overall, the auditor considers the government’s assumptions “plausible,” but she says that their implementation is a challenge.
She warns that future choices could have an impact on services to the population and investments in aging infrastructure.
To achieve a balanced budget, the CAQ government is counting on “moderation” in spending growth. This slowdown implies the reduction or termination of funding for certain program activities.
The gap to be closed, for its part, represents the unidentified part of the actions to be taken to achieve a balanced budget.
In theory, this gap could be closed by further reducing spending, creating new sources of revenue, improving the economic situation, or using provisions in the event of an economic shock.
At Québec solidaire, spokesperson Ruba Ghazal accuses the CAQ of setting the stage for a “ransacking” of public services. “At Québec solidaire, we refuse to choose between essential public services and infrastructure in ruins,” the Solidaire candidate for the position of premier said in a statement.
The report is not a pre-election surprise. In his last two budgets, the minister mentioned the presence of gaps to be eliminated in the coming years.
In its response to the report, the Department of Finance defends its decision to leave a gap to be addressed in the financial statements.
This decision avoids cuts that would not be necessary if the economic situation were better than expected, according to him.
Trump’s shadow
The big question remains the evolution of trade negotiations between Canada and the United States. The Carney government is trying to avoid new 50% tariffs, which the Trump administration is threatening to impose on Wednesday.
“All of this will depend on what happens this week; we are in uncertainty,” says Roy.
“If it materializes this week (the new tariffs), each of the political parties will have to make an adjustment to its financial framework and take the situation into account,” she added.
Minister Girard explained that there are still many uncertainties, particularly on U.S. tariffs and the conflict in Iran.
“There is a possibility of positive news, as well as negative news,” he said. “There are two sides to the distribution of probabilities; we must never forget that.”
–This report by La Presse Canadienne was translated by CityNews
