TERRAZZANO: Carney’s overspending fails fiscal responsibility

The federal government will waste $59 billion paying interest on the debt this year.

Published May 02, 2026  •  Last updated 19 minutes ago  •  3 minute read

Prime Minister Mark Carney. Photo by Hyungcheol Park /Postmedia Network

The fairest way to judge someone is by the standards they set for themselves.

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Prime Minister Mark Carney is failing his own standards on spending.

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In November, Carney released his budget and said he would spend $588 billion this year.

He’s repeatedly promised to reduce spending.

“We are going to spend less to invest more,” Carney proclaimed in the House of Commons.

The budget outlined all the so-called investments. What about “spending less?”

Carney just released his budget update and now he’s going to spend $594 billion.

After only six months, Carney is on track to spend $6 billion over budget.

Why is Carney spending $6 billion over budget halfway through the budget year?

It’s not because of U.S. President Donald Trump, because he was also in the White House six months ago.

It’s not because of what’s happening in the Middle East. The budget update acknowledges that the conflict in the Middle East could “initially improve” the government’s budget because of higher revenues. In fact, federal revenues are now $6 billion higher than forecasted in November’s budget.

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It’s not outside pressure that forced Carney to overspend. An extra $6 billion fell into his lap and, instead of using that money to cut the debt, he decided to blow the extra cash.

Carney is continuing former prime minister Justin Trudeau’s legacy of out-of-control borrowing.

The federal government will borrow $65 billion this year. Carney has no plan to balance the budget and stop borrowing money. The best Carney is willing to do is bring the deficit down to $53 billion in 2030.

This borrowing means more of the money the government takes from taxpayers will be given to bond fund managers.

The federal government will waste $59 billion paying interest on the debt this year.

That means the government is taking $1,400 from each Canadian and, instead of using that money to hire nurses, fix potholes or lower taxes, it’s wasting that money on interest payments.

To put things into perspective, the federal government will waste more money paying interest on the debt than it sends to the provinces in health transfers or takes in through its sales tax.

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Let that sink in for a second. Then think about what we could do if it weren’t for the federal debt. We could double federal health spending. Or we could eliminate the federal sales tax.

Carney’s own budget numbers illustrate former Liberal finance minister Paul Martin’s warnings about the dangers of debt.

“The debt and deficit are not inventions of ideology; they are facts of arithmetic,” Martin said in his 1995 budget speech. “The quicksand of compound interest is real.”

Just 10 years ago, debt interest charges cost a little more than $20 billion per year. Today, that cost has nearly tripled and it’s growing fast. By 2030, debt interest payments will cost $80 billion and chew through 13¢ of every dollar the government takes.

There is nothing fiscally responsible about Carney’s budgeting.

Government MPs are all but throwing themselves a parade for borrowing a little less last year than they planned. They planned to borrow $78 billion. They ended up borrowing $67 billion.

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For context, Prime Minister Justin Trudeau planned to borrow $42 billion in 2025.

Politicians don’t deserve to pop champagne when they borrow $25 billion more than Trudeau planned.

Carney sold Canadians on the idea that he’s different from Trudeau and would manage money better. When it comes to debt, Carney isn’t just different from Trudeau; he may be worse.

From 2025 through 2029, Trudeau planned to borrow $112 billion. Carney plans to borrow twice as much — $242 billion — over those same years.

If taxpayers did a blind taste test, Carney’s budget would taste worse than Trudeau’s.

There are lots of things outside of a prime minister’s control. Nobody can predict what Trump will do next or what will happen in the Middle East. However, Carney can control how much his government spends.

Carney deserves a failing grade for spending $6 billion over his own budget just six months after publishing it.

Franco Terrazzano is the federal director of the Canadian Taxpayers Federation

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