Québec has made notable progress in reducing its debt load in recent decades, although it remains high. Québec is one of the most indebted jurisdictions in Canada.
Province | GDP (%) |
---|---|
Federal | 45.8 |
Newfoundland and Labrador | 45.3 |
Québec | 38.0 |
Ontario | 36.4 |
Manitoba | 35.2 |
Nova Scotia | 31.1 |
Prince Edward Island | 26.7 |
New Brunswick | 25.1 |
British Colombia | 17.4 |
Saskatchewan | 13.1 |
Alberta | 10.0 |
Provincial average(1) | 28.8 |
(1) This average is obtained by dividing the sum of provincial debts by the sum of provincial GDP.
Sources: Public accounts, governments’ budget documents and Statistics Canada.
Reducing the debt burden is a priority for the government.
In addition to promoting greater intergenerational fairness, reducing the debt burden contributes positively to economic growth by creating a climate of confidence conducive to private investment and higher productivity.
The Act to reduce the debt and establish the Generations Fund was adopted in 2006. By reducing the debt burden, it aims to ensure long-term financing of the government’s main missions as well as a prosperous tomorrow for future generations.
As announced in the 2023‑2024 budget, the government is now focusing its reporting on net debt, as are Ontario and other provinces.
As at March 31, 2024, net debt stood at 38.0% of GDP. It is expected that this ratio stands at 39.0% of GDP, as at March 31, 2025. The government intends to reduce it to 30% of GDP by 2037‑2038.
The government also aims for the net debt burden to be 33% of GDP by 2032‑2033. This is an intermediate target.
At a time when it is difficult to forecast how the economy will change over the long term, the government has provided an interval for these two targets. These two targets were incorporated in the Act to reduce the debt and establish the Generations Fund in December 2023.
The government intends to achieve these targets by restoring a balanced budget, continuing to make payments to the Generations Fund and implementing measures to accelerate economic growth.
Year | GDP (%) |
---|---|
2017 | 48.9 |
2018 | 45.9 |
2019 | 42.9 |
2020 | 40.9 |
2021 | 43.1 |
2022 | 38.8 |
2023 | 37.9 |
2024 | 38.0 |
2025 | 39.0 |
2026 | 39.8 |
2027 | 39.5 |
2028 | 39.1 |
2029 | 38.6 |
Since 2006, the Generations Fund is an important pillar of the debt reduction strategy.
In 2024‑2025, revenues dedicated to the Generations Fund will stand at $2.2 billion. They will reach $2.6 billion in 2028‑2029 and $4.1 billion in 2037‑2038.
As at March 31, 2025, the balance of the Generations Fund will stand at $16.7 billion, which is 7.1% of net debt.
Withdrawals from the Generations Fund to repay borrowings will stand at $4.4 billion in 2024‑2025. As announced in the 2024‑2025 budget, these withdrawals include an additional deposit of $400 million to the Generations Fund, drawn from a portion of the accumulated surplus of the Territorial Information Fund of the Ministère des Ressources naturelles et des Forêts. Withdrawals will be $2.5 billion in 2025‑2026. They stood at $2.5 billion in 2023‑2024.
Withdrawals serve to reduce the financing program and alleviate debt service.
2023‑2024 | 2024‑2025 | 2025‑2026 | 2026‑2027 | 2027‑2028 | 2028‑2029 | |
---|---|---|---|---|---|---|
Book value, beginning of year | 18 911 | 18 458 | 16 701 | 16 395 | 18 806 | 21 334 |
Dedicated revenues | ||||||
Water‑power royalties | ||||||
Hydro‑Québec | 705 | 761 | 777 | 893 | 901 | 895 |
Private producers | 110 | 118 | 122 | 124 | 127 | 129 |
Subtotal | 815 | 879 | 899 | 1 017 | 1 028 | 1 024 |
Additional contribution from Hydro‑Québec | 650 | 650 | 650 | 650 | 650 | 650 |
Investment income | 582 | 714 | 645 | 744 | 850 | 961 |
Total dedicated revenues | 2 047 | 2 243 | 2 194 | 2 411 | 2 528 | 2 635 |
Deposit from the Territorial Information Fund | — | 400 | — | — | — | — |
Total deposits | 2 047 | 2 643 | 2 194 | 2 411 | 2 528 | 2 635 |
Use of the Generations Fund to repay borrowings | –2 500 | –4 400 | –2 500 | — | — | — |
Book value, end of year |
18 458 | 16 701 | 16 395 | 18 806 | 21 334 | 23 969 |
% of net debt | 8.4 | 7.1 | 6.6 | 7.3 | 8.1 | 8.9 |
% of GDP | 3.2 | 2.8 | 2.6 | 2.9 | 3.2 | 3.4 |
In 2024, after the 2024‑2025 budget, all the rating agencies that rate Québec have confirmed its credit rating with a stable outlook.
To learn more about Québecs debt and the Generations Fund, see the section entitled The Québec Government’s Debt of the Update on Québec’s Economic and Financial Situation – Fall 2024.