By Robert Presser on March 25, 2010
The game changing 1995 federal budget slashed transfers to the provinces and set in place five years of spending restraint. The resulting limited growth in federal government spending, coupled with falling interest rates that reduced the interest burden on Canada’s existing debt, allowed the federal government to move into surplus before the millennium and post a decade of surpluses which ended in 2009. The great shame of this period of fiscal nirvana is that it could have been even better for the Canadian taxpayer. The Liberals consistently under-estimated their surpluses and even after an orgy of last-minute spending in the final quarter of every fiscal year up until their defeat in 2006, they still exceeded their surplus predictions.
