Deficits seen through 2014: parliamentary budget office

Canada is expected to remain in the red through 2014 as the country racks up deficits totalling $156 billion, according to a pending report from the parliamentary budget office.

In an update to be released Wednesday but already widely cited in media reports, the office said the annual federal deficit is expected to come in at $48.6 billion for the current fiscal year. By the 2013-14 fiscal period, the deficit is projected to be $16.7 billion.

The budget office said its "calculations suggest that the budget is not structurally balanced over the medium term."

The government's own projection for this year's deficit has gone from $33.7 billion in the original budget tabled in January to a current forecast of $50.2 billion, due to tumbling tax revenues and higher expenses brought on by the recession.

Bloomberg reported that the budget office, which is headed by Kevin Page, foresees economic contraction of 2.4 per cent this year, followed by 2.2 per cent growth next year and 3.5 per cent growth in 2011.

The budget office is also forecasting bigger job losses for the country, suggesting that as many as 530,000 jobs could be lost this year, and as many as 700,000 next year.