Consolidated government finance: Assets and liabilities

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Continuing the downward trend that began in 1999, the consolidated net financial debt of the federal, provincial and territorial general and local governments decreased to $776.6 billion as of March 31, 2006, down $14.6 billion from March 31, 2005. Net financial debt is defined as the excess of liabilities over financial assets.

Assets grew $17.4 billion while liabilities rose by $2.8 billion. An increase in securities investments, such as treasury bills, short-term paper, bonds and shares, accounted for most of the growth in assets.

Although the net increase in liabilities was relatively small, the composition of the debt shifted. In fiscal year 2006, governments used more short- and medium-term debt instruments than they had in the past. Other securities, treasury bills, deposits and payables posted the largest increases in liabilities. These were mainly offset by a decrease of $29.4 billion in bonds and debentures issued by governments.

The federal government net financial debt declined by 1.8% to $514.1 billion as of March 31, 2006, while the consolidated net financial debt of the provincial and territorial general and local governments fell by almost 2% to $262.5 billion. Alberta and British Columbia were the largest contributors to the decrease of the net financial debt with a combined downward effect of $11.3 billion. This decline was partly offset by a combined increase of $6.4 billion in net financial debt in Quebec and Ontario.

In fiscal year 2006, the consolidated net financial debt of the federal, provincial and territorial general and local governments represented 55.6% of gross domestic product (GDP), down from 60.5% the year before. Net financial debt, as a percentage of GDP, has decreased every year since it peaked in 1996 at 102.6%.

On a per capita basis, net financial debt fell $702 from fiscal year 2005 to fiscal year 2006 to reach $23,864. As of March 31, 2006, it stood 16.4% lower than its peak of $28,543 in 1997.

Newfoundland and Labrador had the highest per capita net financial debt in fiscal year 2006, followed by Quebec and Nova Scotia. Governments in Alberta, the Northwest Territories and the Yukon did not register any net financial debt as their financial assets exceeded their liabilities.

Note: The Financial Management System (FMS) provides a standardized presentation of government accounting for the federal, provincial, territorial and local governments in Canada. The individual governments' accounting systems are not directly comparable because the policies and structure of governments differ.

The FMS adjusts data from government Public Accounts and other records to provide detailed data that permit inter-government comparisons as well as compatible national aggregates that are consistent over time. As a result, FMS statistics may not accord with the figures published in government financial statements. A reconciliation statement between the Public Accounts and the FMS is available on CANSIM.

This release is part of a series of data products related to government balance sheets. Provincial and territorial general government balance sheets were released in December 2007, federal government balance sheet was released in January 2008 and local government balance sheet was released in April 2008.

Available on CANSIM: tables 385-0010, 385-0014, 385-0018, 385-0019, 385-0025, 385-0026 and 385-0029.

Definitions, data sources and methods: survey number 1709.

Data tables on public sector finance are also available online in the National Economic Account module on our website.

Data are also available through custom and special tabulation. For more information on the products or services of the Public Institutions Division, contact Client Services (613-951-0767; fe-pid-dipinfo@statcan.gc.ca).

To enquire about the concepts, methods or data quality of this release, contact Philippe Samborski (613-951-7101; philippe.samborski@statcan.gc.ca), Public Institutions Division.

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