Montreal, March 18, 2016 – Following the tabling of the Quebec budget on Thursday, the MEI has updated its real-time Debt Clock, and the amount displayed on this counter should be a top concern for Quebecers and for the sitting government.
The public sector debt currently stands at $276 billion. Using data provided by the Finance Department in its 2016-2017 Budget Plan (which does not include Quebec’s share of the federal debt), the MEI estimates that the debt will increase by $7.1 billion by March 31, 2017, or $19 million a day, $13,437 per minute, or $224 per second.
In 2016-2017, $10.4 billion will go toward servicing the debt, instead of being used to improve schools, hospitals, or other services for Quebecers. This is equivalent to a little more than the total amount spent on primary and secondary education.
This marked increase in public indebtedness arises in spite of the fact that the government announced a balanced budget. “This shows that a zero deficit does not mean no new debt,” points out Youri Chassin, Research Director at the MEI. “The Quebec debt continues to increase by $7 billion a year because the government’s revenues, although they keep rising, remain insufficient to finance infrastructure projects and a portion of current public spending, which are not included in the budget.”
The Quebec Debt Clock shows the growth of the public sector debt in real time. This includes the government’s gross debt as well as the debt of the health and social services and education networks, municipalities and other public corporations for which the government is ultimately responsible.
When the Debt Clock was launched by the MEI in 2009, the public debt totalled $215.3 billion. This means that it increased by over $60 billion in just seven years.
“The government’s indebtedness should be of profound concern to Quebecers, who will one day or another have to pay back this debt through additional taxes,” says Michel Kelly-Gagnon, President and CEO of the MEI. “And since the tax burden of workers is already very high, the solution must come through a reduction in public spending. A certain amount of effort was made in this regard, but this level of indebtedness shows that a real shift is needed.”
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The Montreal Economic Institute is an independent, non-partisan, notfor-profit research and educational organization. Through its studies and its conferences, the MEI stimulates debate on public policies in Quebec and across Canada by proposing wealth-creating reforms based on market mechanisms.
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