Fiscal watchdog warns of rising deficits from defense spending targets

OTTAWA — Canada’s interim Parliamentary Budget Officer, Jason Jacques, projects that the Carney government’s commitment to increase defence spending to at least 5% of GDP will raise the federal deficit by $63 billion annually over the next decade. This increase, driven by security concerns and a NATO pledge, will elevate the debt-to-GDP ratio by 6.3 percentage points by 2035. Current projections already indicate a deficit of $78.3 billion for the fiscal year, with total federal debt reaching $1.27 trillion.

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