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March 14, 2024QUEBEC BUDGET 2024-25 The Province of Québec has released its provincial budget for 2024-25. Québec budgets include payments to its Generations Fund, as well as contingencies and gaps to be bridged in order to meet targets.
Québec expects that the 2024-25 deficit will be $11.0 billion, after a $2.2 billion contribution to the Generations Fund. This is a substantial increase from the deficit forecast for 2023-24 ($6.3 billion, after a $2.1 billion contribution to the Generations Fund). In 2025-26, the deficit is projected to contract to $8.5 billion, after another $2.3 billion contribution to the Generations Fund.
In 2024-25, Québec's revenues are projected to increase by 2.4% while expenditures rise by 4.4%. In 2025-26, revenue growth of 4.2% is projected to pull ahead of the expenditure rise of 2.9%. In 2026-27, Québec expects revenue gains of 4.6% while expenditure growth is projected slow to 2.2%. In 2027-28, revenue growth is projected to slow to 2.9% while expenditure growth accelerates to 2.7%. In 2028-29, Québec expects both revenues and expenditures to rise by 2.6%.
Measured as a share of GDP, the footprint of government in the Québec economy is expected to decline slowly from 27.3% in 2024-25 (including 0.2% contingency and 0.4% payment to Generations Fund) to 26.2% in 2028-29. Québec's deficit amounts to 1.9% of GDP in 2024-25. This is projected to contract to 0.6% by 2027-28 and 2028-29. Québec's payment to the Generations Fund remains stable at 0.4% of GDP throughout the planning horizon.
After reaching a trough at 38.3% of GDP at the end of 2022-23, Québec's net debt is projected to rise to 39.0% of GDP at the end of 2023-24. Québec's net debt to GDP is projected to rise back above 40% over the next two years, before starting to decline again, falling to 39.5% of GDP by 2028-29 (including contingency reserve and gap to be bridged).
Québec's expenditures for 2024-25 amount to $17,271 per capita against revenues of $16,473 per capita, leaving a deficit of $1,205 per capita. Québec's deficit is projected to contract to $422 per capita by 2028-29 (after contingency, gap to be bridged and payments to the Generations Fund). Québec's contributions to the Generations Fund amount to $244 per capita in 2024-25, rising to $286 per capita by 2028-29.
Compared to the fiscal outlook from the 2023-24 Budget, Québec's 2024-25 fiscal plan anticipates little change in revenues for the near term, but substantially higher expenditures.
Québec's deficit of $11.0 billion in 2024-25 includes a $2.2 billion payment to the Generations Fund, leaving an underlying deficit of $8.8 billion. The underlying deficit is projected to narrow considerably in the next two years, but (unlike the previous fiscal plan) does not return to balance over the fiscal horizon.
Tight financial conditions contributed to a stagnant Québec economy in 2023 - with real GDP growth of just 0.2% after contractions in Q2 and Q3. As interest rates are expected to ease later in 2024, Québec's real GDP is projected to recover to growth of 0.6%. Recovery in domestic demand from population growth and investment along with a robust labour market are expected to drive growth in the near term. Improvement in external demand is expected to take longer to materialize. Government investment is expected to peak in 2025. Inflation remains a considerable uncertainty in Québec's economic outlook.
Key Measures and Initiatives
Québec's Budget for 2024-25 emphasizes priorities for health and education, with support for Québecers and communities, action on economic priorities and optimization of government supports.
$3.7 billion for organization of health care and social services
- improving access to care and hospital fluidity
- enhancing home support services and housing for seniors
- ensuring quality of care for seniors
- consolidating mental health and social services
- supporting community organizations
- meeting needs of youth protection services
$819 million for educational success, plus $421 million for higher education
- supporting student services
- attraction and retention of school staff
- accelerating maintenance of schools
- supporting food in schools
- promoting retention of university students
- training in priority fields, digital transformation
- increasing student housing units and maintaining student housing inventory
$1.3 billion for consolidating support to Québecers
- access to housing
- helping the vulnerable
- promoting social inclusion and food banks
- eliminating retirement pension reduction for seniors with disabilities
$441 million for supporting communities
- promoting participation in recreation and sport
- consolidating public safety intervenion capacity
- strengthening legal support for the vulnerable
$187 million for showcasing culture and promoting French language
- showcasing Québec culture and heritage
- advancing the French language
- enhancing the tax credit for Québec film/television production
$128 million for adapting to climate change and protecting the environment
$443 million for strategic sectors
- developing aerospace and aluminium sectors
- promoting adoption of new technologies and research
- supporting entrepreneurship
$126 million for growing the labour pool and improving productivity in construction
$889 million for regional prosperity
- supporting the tourism, forest and bio-food sectors
- boosting regional mobility
- strengthening partnerships with First Nations
$400 million for economic and social integration of immigrants
$2.9 billion over 5 years to optimize government action
- adjusting business support tax measures
- controlling tobacco
- ensuring fairness and integrity of the tax system
Québec Budget 2024-25
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