Just imagine Canada's military having and extra $31.2 billion to spend on guns and bullets..The Parliamentary Budget Office says that's the amount of taxpayers' money spent on federal debt charges, surpassing the entire national defence budget that sits at $26.5 billion, says Blacklock's Reporter..“Public debt charges are projected to more than double,” said a PBO report..Charges would be “reaching $47.6 billion in 2027 due to higher interest rates and the additional accumulation of federal debt,” it said..Analysts also warned of a “pronounced slowdown or contraction in the Canadian economy.”.“Given high levels of household indebtedness and elevated levels of house prices in Canada, households could pull back their spending to a greater extent and residential investment could decline more than anticipated,” said the report..Budget Officer Yves Giroux in September 27 testimony at the Senate banking committee said rising interest rates would cost the federal treasury billions..“That is something that will have a major impact on public finances,” he said..The Bank of Canada raised its prime rate five times this year to the current 3.25%. A sixth rate hike is due October 26..Giroux earlier said he did not think cabinet’s long term deficit reduction plan was credible. Cabinet projected its $113.8 billion deficit would fall more than 90% within five years..“I personally do not believe it’s credible there will be that level of spending restraint,” Giroux said in June 7 testimony at the Senate national finance committee..“That would probably be fiscal tightening or expenditure restraint more severe than what we had seen under the Conservatives in the early 2000s,” he added..No cabinet has balanced a budget since 2007. Parliament on May 6, 2021 voted to raise the federal debt ceiling 56% from $1.168 trillion to $1.831 trillion..“The demands on the public purse are numerous and they account for significant amounts of money,” testified Giroux..Finance Minister Freeland repeatedly promised to cut spending..“The government remains committed to unwinding COVID-19 related deficits,” Freeland wrote in a Fiscal Update last December 14..Freeland in a speech to the Commons last November 5 said deficit spending could not continue indefinitely. “Limits exist,” said Freeland..“What are they?” asked now-Opposition Leader Pierre Poilievre..“There is no blank cheque,” replied Freeland..“Is the limit a percentage or a dollar figure?” asked MP Poilievre..“Unlike the member opposite, I’m the finance minister and I need to be very careful with my words,” replied Freeland.
