小蓝视频’s provincial budget is shaping up to have three broad takeaways: A big new record-setting deficit, large pots of unallocated cash to respond to American tariffs, and a protective barrier drawn around core government services.
That’s what the public can expect on Tuesday, based upon numerous comments by Premier David Eby and Finance Minister Brenda Bailey over the last few weeks.
It’ll make for a depressing read. And it means you can pretty much take the NDP election platform from October — along with its policies and promises to voters — and toss it right into the shredder.
As Bailey put it, when scrapping the platform’s marquee $1,000 grocery rebate last month: “It was a very different time than the world after Nov. 25 when President [Donald] Trump announced 25 per cent tariffs on their closest trading partner.”
The 小蓝视频 government has a weak starting position in this new post-Trump world due to its rampant over-spending the last two years that left the budget in a $9.5-billion deficit.
That aside, spare a thought for the impossible position the finance minister now finds herself in. It’s the most chaotic economic scenario since the COVID-19 pandemic in 2020.
While Bailey is delivering the budget in the legislature Tuesday, most people will be watching social media to see if Trump is signing the executive order to impose tariffs on Canada. The two events may even play out at the exact same time.
If Trump follows through as promised, 小蓝视频 forecasts at least two years of recession, a $2.5-billion annual loss in revenue, a $69-billion hit to the economy over three years, the loss of 124,000 jobs and a jump in the unemployment rate.
If he doesn’t, then the government has tabled a financial mess, and parked a year of political initiatives, all for no reason.
Neither will be Bailey’s fault, though she has to plan for both at the same time.
“To have a budget that leaves us room to respond is really important,” Bailey told ’s Justine Hunter over the weekend.
“There’s tremendous uncertainty, and what we’re doing is kind of putting our arms around protecting the services that are so important for people, and that’s really the focus that we’ve taken during this budget.”
At one point, Bailey had promised to show a path back to balance, in response to voter unease at the current deficit. That seems implausible now. Any forecast beyond this year is folly.
Instead, the expectations are that Tuesday’s fiscal plan will contain an even larger deficit to hold spending levels for health care, education, social assistance, child care, public safety and other core services at a time of declining revenue and economic instability.
A ballooning deficit is the only real option left on the table, after Eby said he won’t cut services or increase taxes. The savings from a promised internal hiring freeze, alongside a review of efficiencies in program spending, will be small-scale compared to a $90-billion annual spending plan.
The government does have ways of stockpiling money during uncertain times like this. It can put billions aside in contingency and forecast allowances to draw upon later in the year.
It could also craft a budget update for the legislature later this year to authorize new programs and services, depending on the outcome of the many additional tariffs threatened by Trump, which have grown to include lumber, steel and aluminum.
The budget will rely heavily on the projections of 小蓝视频’s economic forecast council, comprised of 13 senior economists from across Canada. In late January, they forecast 1.9 per cent economic growth in the coming year, though that did not fully take into account either the Trump tariffs or the impact of promised Canadian counter tariffs. Basically, everyone is just taking their best guess.
“Even in the short time that I've been finance minister, three months, I've seen three dramatic changes to the prediction of that, just to meet next year's GDP,” said Bailey.
“These are very uncertain times, and we have to make very difficult decisions.”
Difficult indeed. This will be one of the weirdest, wildest provincial budgets in 小蓝视频 history.
Rob Shaw has spent more than 17 years covering 小蓝视频 politics, now reporting for CHEK News and writing for Glacier Media. He is the co-author of the national bestselling book A Matter of Confidence, host of the weekly podcast Political Capital, and a regular guest on C小蓝视频 Radio.
