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Barring a change of heart, the federal government intends to run budget deficits until 2070, according to the Parliamentary Budget Officer (PBO). The PBO’s Fiscal Sustainability Report reported that Ottawa’s fiscal situation was “sustainable,” but it spurred warning calls about Canada’s fiscal health. Ballooning elderly benefits costs, temporary expansions to employment insurance, childcare, reflect sizable new social spending plans by the government. Longer-term issues like Canada’s ageing population will continue to strain public finances. The PBO predicted annual costs for elderly benefits will double peak in 2032 from $56 billion in 2020 to $115 billion. These costs as a percentage of GDP would increase from 2.6 percent today to 3.1 percent then. Provincial healthcare systems are not equipped to handle the projected uptick in service demand. “Overall, it paints a picture of unsustainability for finances, both federal and provincial combined,” Parliamentary Budget Officer Yves Giroux said in an interview with the National Post. “And that is the big elephant in the room that nobody seems to be worried about or wanting to address.”

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