Government Operations Committee on June 16th, 2026

[Vince Gasparro, Liberal, Eglinton—Lawrence, ON]

Thank you.

[The Chair, Conservative, Kelly McCauley]

Madame Gaudreau.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Thank you, Mr. Chair.

Ms. Ryan, thank you again. It's always very important to get an accurate picture of the situation. I'm aware that the new government has made changes to the anchor. Even the International Monetary Fund, the IMF, said Canada should restore its anchor, namely the debt-to-GDP ratio. For a long time, that ratio was the main benchmark for assessing the country's finances. Today, that anchor has disappeared.

What's Canada's fiscal anchor now?

[Annette Ryan]

You raise important points. In fact, the current government has two anchors. One is the deficit-to-GDP ratio, and the other is a commitment from the government to balance operating spending with revenues. The government is clarifying its commitment to spend less and invest more, in a context where it is seeking to increase overall GDP. It's a matter of increasing the denominator so a certain level of prosperity allows the government to spend more in the future.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

How does the government respond to the IMF's call for the anchor to be restored?

[Annette Ryan]

I think it's important to remember that no one figure is the be-all and end-all for managing something as complex as the Canadian government or economy.

These are a series of important metrics, but it's also important for a government to keep its commitments. If that's not possible, it must be transparent with Canadians and, above all, with parliamentarians about what it will or will not do.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Let's look at public spending.

There's a lot of talk about cost, but less about quality, even though quality ultimately offers profitability and prosperity.

Does Canada have enough tools to accurately measure public spending?

[Annette Ryan]

To put it simply, no.

We have a range of annual measures that allow us to track government spending. However, departmental annual reports are structured by the government to highlight its perspective on the quality of the spending.

I don't want to put words in your mouth, but I think we agree that we would all benefit from a more informative range of metrics with respect to the quality of spending.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

It would therefore be relevant for the Office of the Parliamentary Budget Officer to conduct an evaluation and measure the quality of spending.

[Annette Ryan]

I think that's an important goal. We have actually begun discussions on how to do it.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Okay.

I only have two minutes of speaking time left, but I still have several questions to ask you.

Earlier, we talked about the cost of public investment. Besides the quality of the investment, do you assess the cost of inaction? I'm referring, for instance, to the housing shortage, aging infrastructure and underinvestment.

[Annette Ryan]

In the past, we've conducted studies related to this objective. For example, we conducted a major housing study in August 2025. Ms. Nicol was one of the main authors of the study. We plan to do more.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Is there a risk that savings today could lead to higher costs tomorrow?

[Annette Ryan]

Certainly.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

I wanted to hear you say it.

Since I only have a few seconds left, I'll talk more about major projects during my next turn.

It's about the relatively low growth of real GDP, which is between one and two per cent. In a context of low growth and stagnant productivity, what role should major infrastructure projects play in a growth strategy?

[Annette Ryan]

In my opinion, it's important to consider how the government's plan might work. Government spending is often proposed or recommended when there isn't a lot of economic activity. In addition, that infrastructure is seen as the foundation for private sector economic activity in the future. That's the government's philosophy.

As you said, there's the issue of implementing a well‑thought‑out planning framework to be completed on time and on budget. These are also important elements.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Thank you, Ms. Ryan.

Thank you very much, Mr. Chair.

[The Chair, Conservative, Kelly McCauley]

Thank you.

Ms. Block, please go ahead.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Thank you, Mr. Chair.

Thank you, Ms. Ryan and your colleagues, for joining us today.

I am going to focus on your economic and fiscal outlook. I really want to zero in on one of the statements in the highlights. It says, “Assuming no new measures are introduced and existing temporary measures sunset as scheduled; the budgetary deficit is projected to decline to $58.2 billion by 2030-31”. I want to ask for more of an explanation of that, but perhaps I'll ask my first question.

Your report showed that the debt-to-GDP ratio would be “flat over the medium term”. Is that based on the same assumption: as long as there is no new funding introduced and old temporary spending sunsets?

[Annette Ryan]

That's correct, Ms. Block.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Is this a reasonable assumption? This is getting back to my first question around an explanation.

[Annette Ryan]

I think it's difficult to portray all possible actions that a government might take. For that reason, we wanted to have a baseline so that people could understand what's in and what's out, and from there, reasonable people can take their own perspectives about what the government may do moving forward in terms of things like the renewal of the Canada health transfer, which is currently on a track to moving to much lower growth for provinces and territories per current legislation.

People may differ on whether the government will move to take that back up to the traditional 5% to 6% range. That's not in our forecast. It's not in our medium-term track. We wanted to be clear and transparent so that as people look at these types of measures moving forward, they can say, “Okay, that's not in, but we anticipate that would be a reasonable thing to do.” Then if the government does that, you know, and you can do calculations of where that takes us in terms of debt to GDP and so on.

That was the underlying logic.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Just for my own understanding, how many times in the last 10 years has the government not introduced new spending? Did you take that into consideration?

[Annette Ryan]

It would be very few times, if not definitely zero.

The question of how we can best support a discussion of the fact that the fiscal track has gone up year after year in budget after budget is very much the reality. We think we could do better in terms of putting that forward in a separate document very soon, which would make it more comprehensible for parliamentarians and average Canadians to benchmark that. You can take a year like 2025. When it was first forecast, expenditures—I'm not going to be accurate here—would have been roughly $420 billion, and then they rose through time to the level of $510 billion that we're at now.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Getting back to debt to GDP, if the government introduces new spending in the next budget, for example, how much new spending would it take for the medium-term forecast to show an additional increase to Canada's debt-to-GDP ratio?