Canadian Government Debt: Gross 132%, Net 21% of GDP
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- Canadian governments' combined gross debt has risen to 132% of GDP, the highest level since 1997 excluding pandemic years, with the upward trend dating back to 2008
- Net financial liabilities for all Canadian governments have declined since 1997, hitting a low of 19% of GDP in 2025 before ticking up to 21% today
- CPP and QPP pension assets now represent roughly a quarter of governments' financial assets, driven more by broad equity market gains than active fund management
- Net liabilities excluding CPP/QPP sit at about 50% of GDP — similar to 2006 levels — because pension promises are not counted as liabilities anywhere under current accounting rules
- Canada's borrowing costs are currently lower than the U.S.'s, a reversal from the late 20th century, helped by the fiscal discipline Canada showed between 1990 and 2008
- Ontario and Quebec are flagged as among the world's most indebted sub-national borrowers, with author Hanif Bayat warning that they should not let debt-to-GDP ratios drift higher
Why it matters: The 111-percentage-point gap between gross debt (132% of GDP) and net financial liabilities (21%) hinges largely on CPP/QPP pension assets — funds legally earmarked for pensioners and not redirectable by any single government. Excluding those assets, net liabilities land at roughly 50% of GDP, a figure similar to 2006, which the source argues is the most useful measure for assessing real fiscal room going into the next crisis.
