OTTAWA — The federal government posted a surprise $1.9-billion surplus in 2014-15 — bringing the country's books back into balance a year earlier than expected.
The Finance Department released year-end figures Monday for a period that was supposed to instead generate a $2.0-billion shortfall.
The number ends a streak of six deficits under the Conservatives and is certain to reverberate on the campaign trail.
The fiscal report also tees up Thursday's leaders' debate, which will focus on the economy.
Political leaders have jockeyed to portray themselves as the best managers of the public piggy bank as the economy has struggled amid the steep slide in commodity prices.
The result pleased Conservative Leader Stephen Harper, whose government had forecasted a $2.0-billion deficit for 2014-15 in its April budget.
Harper issued a statement crediting "careful economic stewardship" for guiding the budget to balance a year ahead of schedule.
The Finance Department said the $3.9-billion swing from the expected shortfall to surplus was largely due to higher revenue — from personal and corporate income taxes — that rang in $3.0 billion higher than projected as well as positive year-end adjustments.
The report also found expenditures were lower. Program spending was $800 million lower than forecast, while public debt charges were $100 million lower than expected.
Looking forward, the Tories have predicted a $1.4-billion surplus for the current 2015-16 fiscal year — a projection opponents insist the government is unlikely to hit.
Political rivals charge that Ottawa is instead on track to run a shortfall in the current fiscal year because the economy contracted over the first two quarters of 2015 and pushed the country into a technical recession.
Harper, who has noted that experts have predicted the economy to bounce back over the second half of the year, has insisted the government will produce a surplus in 2015-16.
He has repeatedly pointed to early numbers released by the Finance Department as evidence the country is on track.
Last month, the Finance Department reported a $5-billion surplus for the April-June quarter.
Harper's opponents have dismissed it as preliminary data, a tally that received a $1-billion boost from a one-time asset sale of taxpayers' General Motors shares.
Government officials routinely warn that a few months of information do not necessarily paint the picture for the whole year.
In July, the parliamentary budget officer released an analysis based on downgraded Bank of Canada projections that showed Ottawa was headed for a $1-billion shortfall in 2015-16. The calculation whipped up doubt about the Conservatives' long-standing promise to balance the election-year books.
The debate over balancing the budget has, at times, dominated political discourse during the election campaign.
"According to a wide range of experts, we are in deficit right now — Mr. Harper has put us in deficit this year," Liberal Leader Justin Trudeau said Monday when asked about the 2014-15 numbers.
Trudeau accused Harper of implementing billions of dollars in underspending and cuts to veterans, seniors and aboriginal programs in order for him to balance the books before the election.
"It was a political goal that actually has helped us slide into the recession," he said.
Trudeau has set his party apart from the Conservatives and the NDP by committing to run shortfalls before balancing the budget in 2019. He says his plan, which includes investing in infrastructure, will spur economic growth.
The New Democrats have pledged to balance the books next year despite their big-ticket promises that include a plan to create one million $15-a-day child-care spaces. Once fully implemented, the program would cost taxpayers an estimated $5 billion annually.
To help pay for its commitments, NDP Leader Tom Mulcair has vowed to erase the Tories' controversial $2-billion-a-year income-splitting measure for families with kids. Mulcair is also pledging to raise corporate tax rates by an as-yet-unspecified amount and close a tax loophole on CEO stock options.
The NDP, which has come under pressure to release its numbers, has said it will unveil its costed platform before a debate Thursday.
The Finance Department the 2014-15 surplus follows the $5.2-billion deficit posted by Ottawa in 2013-14.
NEWS OF BALANCED BUDGET BUOYS HARPER AS ECONOMY TAKES ELECTION CENTRE STAGE
OTTAWA — A Conservative party buffeted by weeks of bad news on the election trail as it seeks a new mandate welcomed word today that the federal government posted a $1.9 billion surplus last year.
Prime Minister Stephen Harper issued a news release touting the final tally for the 2014-15 fiscal year as evidence of his government's "careful economic stewardship."
The timing of the announcement from Finance Canada couldn't be better for Harper, with the Conservative, NDP and Liberal leaders set to face off later this week in a Calgary election debate on the economy.
"The protection of our economy is our No. 1 priority," Harper, who is campaigning in British Columbia, said in his statement.
"Amid increasing instability in the global economy, our Conservative government's economic action plan is working; delivering new jobs and economic growth through lower taxes and a balanced budget."
As recently as its April budget, the Conservative government was still pencilling in a $2 billion deficit for last year, with federal ledgers predicted to be back in the black for this 2015-16 fiscal year.
Economists say the marginal deficit forecast for 2014-15 and the marginal surplus that eventually emerged today are immaterial from a fiscal standpoint, but the numbers have taken on exaggerated political symbolism in the run-up to the Oct. 19 federal election.
Timing the deficit elimination to coincide with this October's fixed election date was always a political rather than economic imperative and Harper's news release noted the return to surplus, following six consecutive deficits in the wake of the 2008-09 global recessions, comes "one full year ahead of schedule."
The surplus figures also shone a spotlight on Liberal Leader Justin Trudeau's pledge to run deficits of up to $10 billion annually for the first three years of a Liberal mandate.
Both Harper and NDP Leader Tom Mulcair have attacked the Liberal plan and Mulcair again characterized it as a "reckless promise" and evidence of "short-term thinking" at a Monday campaign stop in Vancouver.
"Today's numbers are good news for Canadians and it shows that the NDP's going to be starting off on the right foot," said Mulcair, who has committed to a balanced budget in his first full year in office.
Trudeau, for his part, isn't buying Conservative claims that the country's economy has turned the corner. Harper has claimed that a $5 billion surplus in government accounts through the first three months of 2015-16 is proof this year will end in the black, however Finance officials continually caution that monthly tallies in the "fiscal monitor" are not predictive of the year-end accounting.
Others, such as the parliamentary budget office, have warned that low oil prices point to a marginal government deficit this year.
"We are in deficit right now," Trudeau asserted Monday at a campaign event in Toronto.
"Mr. Harper has put us in deficit this year. As for last year's numbers, we know and we saw Mr. Harper underspending and making cuts to Veterans Affairs, to Aboriginal Affairs, to seniors in the billions of dollars so that he could balance the books in time for his election."
Trudeau maintained that his proposed deficits will fund a massive infrastructure build that will better position the economy for the future.
