REACTION: Quebec downgrade shows the importance of better spending control, says the MEI

Montreal, April 16, 2025 – The Quebec government must simply do a better job of controlling its spending, says an MEI researcher in reaction to the downgrade announced by S&P Global Ratings earlier today.

“With the record deficits being announced, the question was not whether the province would be downgraded, but when,” says Gabriel Giguère, senior policy analyst at the MEI. “As a result of this downgrade, it will become more expensive for the government to borrow, which will exert upward pressure on interest payments.”

“Let’s hope the Legault government heeds this warning and finally tackles the explosion of spending that is behind these deficits.”

S&P Global Ratings announced that it was lowering Quebec’s debt rating from AA- to A+ earlier today.

The agency justified its decision by pointing to the deterioration of the province’s public finances, noting among other things increased operating spending related to remuneration.

Although the Quebec government has adopted a plan to return to budgetary balance by 2029-2030, the agency does not foresee that this plan will have a notable effect on the province’s financial situation over the next two years.

In its pre-budget brief submitted in January, the MEI reminded the provincial government of the importance of doing a better job of controlling its spending, observing among other things the quasi-systemic growth of projected spending between economic updates and budgets.

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The MEI is an independent public policy think tank with offices in Montreal, Calgary, and Ottawa. Through its publications, media appearances, and advisory services to policymakers, the MEI stimulates public policy debate and reforms based on sound economics and entrepreneurship.

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