The federal government has posted a surplus of $1.9 billion for the fiscal 2014-15 year ended March 31, 2015, bringing the budget into balance a year sooner than expected.
The results came as a surprise to some as the government had originally budgeted a $2.08 billion deficit for the period.
Laura Cooper, economist at RBC Economics, said the stronger-than-expected bottom line was due to both higher revenue and lower total expenditures.
“Relative to the Budget 2015 projections, revenues were $3 billion stronger than expected at $282.3 billion and predominantly reflected higher taxation revenues derived from personal and corporate incomes – each up by $1.5 billion to $135.7 billion and $39.4 billion, respectively,” Cooper said in a note to investors.
“On the expenditure side, higher-than-expected transfers to persons, including elderly benefits and employment insurance benefits, were more than offset by lower direct program expenses. The latter came in $1.5 billion below the Budget 2015 estimate at $115.8 billion to contribute to overall program expenses recording a final tally of $253.8 billion.”
The accumulated deficit was $612.3 billion as of March 31. This is more than $1.6 billion lower than the $614 billion deficit budgeted.
“As a share of gross domestic product, federal debt came in at 31.0%, which is only modestly below the 31.2% projected at the time of the April budget and compared to 32.3% a year ago,” Cooper said.
Prime Minister Stephen Harper issued a statement on the Conservative Party website saying the surplus came as a result of the “Conservative government’s careful economic stewardship.”
“This is in addition to last month’s news that we have confirmed a $5 billion surplus for the first three months of the current fiscal year,” Harper said in the statement.
The federal government posted a deficit of $5.2 billion in the fiscal 2013-14 year.
