Fact check: What is the projected debt to GDP ratio for Canada in 2025?

1. Why one headline says “113%” — the data point that shocks readers

Trading Economics and similar aggregators publish a figure of 113.0% government gross debt-to-GDP for Canada at the end of 2025, which answers the direct numeric question if one accepts their series and definition ^[1]. That number is presented as gross government debt, a measure that counts total liabilities without subtracting financial assets, and may also reflect consolidated general government (federal plus provincial) accounting or a specific dataset’s historical revisions and projection model. Users should note that such aggregator figures are useful for cross-country comparisons but can mix fiscal concepts; a 113% gross ratio is not the same as the federal net debt-to-GDP metric central to Canadian budget debates ^[1].

2. What the Parliamentary Budget Officer says — a very different story

The Office of the Parliamentary Budget Officer (PBO) projects the federal debt-to-GDP ratio in the low 40s, citing a rise from 41.7% in 2024–25 to above 43% over the medium term, while the PBO’s reports do not publish a single 2025 calendar-year gross figure equivalent to the 113% cited by aggregators ^{[2] [4]}. The PBO focuses on federal net debt—which subtracts financial assets and excludes provincial debts—and frames its forecasts around budgetary deficits, such as a projected $68.5 billion deficit in 2025–26 that drives a worsening federal ratio. This federal net measure is the reference point used by Canadian policymakers and is materially lower than gross consolidated measures ^{[2] [4]}.

3. Provincial debt and combined measures — the missing context behind big numbers

Institutions like the Fraser Institute and some consolidated datasets highlight that combined federal and provincial net debt has grown substantially, with analyses citing near-doubling of combined net debt and federal net-debt-to-GDP figures in the mid-40% range, which helps explain why some consolidated ratios appear much larger than federal-only numbers ^[3]. Aggregated or “general government” series that combine federal and provincial liabilities, possibly on a gross basis, can push ratios above 100% in smaller economies or under certain accounting treatments; without clear labeling, these consolidated ratios can be conflated with the federal net debt figures relied upon by Canadian fiscal authorities ^[3].

4. Methodology matters — definitions, timeframes, and gross vs. net

The divergent numbers stem from three methodological drivers: whether the series measures gross or net debt; whether it reports federal only or consolidated federal-plus-provincial obligations; and whether the reference is fiscal-year or calendar-year. Trading Economics’ 113% figure is labeled “government gross debt,” while the PBO’s 41–43% range refers to federal net debt measured against GDP and tied to fiscal-year budgets and deficit projections ^{[1] [2]}. Analysts and journalists must check the underlying series note: a higher gross consolidated ratio is not inconsistent with a lower federal net ratio when assets, intergovernmental balances, and provincial obligations are treated differently ^{[1] [2] [3]}.

5. Practical takeaways — which number should you use and why it matters

For policy discussion within Canada, the PBO’s federal net debt-to-GDP estimates are the standard metric used by Parliament and the federal government and therefore the most relevant for assessing federal fiscal sustainability ^{[2] [4]}. For international or cross-jurisdictional comparisons, gross consolidated measures—like the 113% figure reported by data aggregators—can be informative but must be interpreted with caution because they reflect different accounting choices and may overstate the fiscal pressure facing the federal government alone ^{[1] [3]}. Readers should therefore cite the exact metric (gross vs. net, federal vs. consolidated) when reporting a 2025 debt-to-GDP figure to avoid conflating distinct fiscal concepts ^{[1] [2]}.