Frontier Centre for Public Policy study reveals a decade of inflated Liberal forecasts—a track record that casts a long shadow over Carney’s first budget
FOR IMMEDIATE RELEASE
WINNIPEG — The Frontier Centre for Public Policy has released a major new study revealing that the Trudeau government’s federal budget forecasts from 2016 to 2025 were consistently inaccurate and biased — a record that casts serious doubt on the projections in Prime Minister Mark Carney’s first budget.
Carney’s 2025–26 federal budget forecasts a $78.3-billion deficit — twice the size projected last year and four times what was forecast in Budget 2022. But if recent history is any guide, Canadians have good reason to question whether even this ballooning deficit reflects fiscal reality.
Conrad Eder
The 4,000-word study, Measuring Federal Budgetary Balance Forecasting Accuracy and Bias, by Frontier Centre policy analyst Conrad Eder, finds that forecast accuracy collapsed after the Trudeau government took office:
- Current-year forecasts were off by an average of $22.9 billion, or one per cent of GDP.
- Four-year forecasts missed the mark by an average of $94.4 billion, or four per cent of GDP.
- Long-term projections consistently overstated Canada’s fiscal health, showing a clear optimism bias.
Eder’s analysis shows that every three- and four-year forecast under Trudeau predicted a stronger financial position than what actually occurred, masking the true scale of deficits and debt accumulation. The study concludes that this reflects a systemic optimism bias, likely rooted in political incentives: short-term optics with no regard to long-term consequences.
“With Prime Minister Carney now setting Canada’s fiscal direction, it’s critical to assess his projections in light of this track record,” said Eder. “The pattern of bias and inaccuracy under previous Liberal governments gives reason to doubt the credibility of claims that deficits will shrink over time. Canadians deserve fiscal forecasts that are credible and transparent — not political messaging disguised as economic planning.”
The study warns that persistent optimism bias erodes fiscal accountability, weakens public trust and limits citizens’ ability to hold government to account — a threat to both economic sustainability and democratic transparency.
Click here to download the full study.
Media availability
Conrad Eder
Policy Analyst
Frontier Centre for Public Policy
[email protected]
Eder is available for interviews and commentary on fiscal policy, government accountability and budget forecasting.
Media contact
Lindsay Shepherd
Director of communications and engagement
Frontier Centre for Public Policy
[email protected]
Marco Navarro-Génie, PhD
Vice-president of research and policy
Frontier Centre for Public Policy
[email protected]
About the Frontier Centre for Public Policy
The Frontier Centre for Public Policy is an independent Canadian think-tank that conducts research and analysis on economic, social and public policy issues. Since 1999, it has published studies, commentaries and events promoting ideas for a freer and more prosperous society.
📢 For press release submissions and distributions, click here.
Explore more on Federal budget, Federal taxes, Federal debt and deficit, Trudeau government, Carney government, Canadian economy
The views, opinions, and positions expressed by our columnists and contributors are solely their own and do not necessarily reflect those of our publication.
Troy Media empowers Canadian community news outlets by providing independent, insightful analysis and commentary. Our mission is to support local media in helping Canadians stay informed and engaged by delivering reliable content that strengthens community connections and deepens understanding across the country.
