BUSINESS
06/01/2011 02:17 EDT | Updated 08/01/2011 05:12 EDT

Kevin Page, Budget Watchdog, Less Optimistic Than Jim Flaherty's Forecast

CBC - Canada's budget watchdog has been butting heads with Ottawa about the deficit for two years and now he's taking on the country's leading economists.

Parliamentary Budget Officer Kevin Page says his office's independent analysis projects the economy will grow about half-a-point less than the economists' average used by Ottawa in its budgeting assumptions.

And he says Canada's unemployment rate won't fall below seven per cent, from the current 7.6, until 2016, not 2014 as economists see it.

Page says his office has stopped using the average consensus of private sector economists and is doing its own analysis. And that shows economic expansion slowing to 2.2 per cent in 2012 and 2.3 in 2013.

Finance Minister Jim Flaherty has said the government intends to balance the budget in 2014-15, using a formula that builds in some prudence to economist forecasts.

But Page is still unconvinced. He believes government spending will be greater than Flaherty lets on, and doubts the budget will be balanced even a year later. He estimates Ottawa will add $128 billion to the national debt in the next five years, well above the $93.6 billion Ottawa is projecting.