QUEBEC — The province’s auditor general said Monday that the Coalition Avenir Québec government’s short-term financial forecasts are solid, but warns whoever forms the next government that a serious financial crunch looms.
Releasing her pre-election campaign report — a legal exercise required before each vote — auditor general Christine Roy said Finance Minister Eric Girard’s forecast for the coming years basically stands up.
But if the new government to be elected Oct. 5 hopes to stick to Quebec’s stated goal of balancing the books by 2029-30, it is going to have to make difficult choices for the next three years — in other words, over most of its four-year mandate.
In order to maintain existing services to the public, the new government will have to make up for a $2-billion shortfall for 2027-28 and $3 billion for 2028-29.
On top of that, there is an existing $1.85-billion shortfall that Girard tagged “gap to be bridged” in the future in his March 18, 2026 budget. The grand total Quebec will need to come up with to plug the hole in the budget by the end of 2028-29 is thus $4.85 billion.
Governments traditionally have two options to make up shortfalls: cut spending or increase taxes. Neither is very popular with voters.
“The risk is that resolving the $1.85-billion gap will have to be achieved by an additional reduction in spending, which will bring the total budgetary effort of spending reductions to $5 billion,” Roy said in her 68-page report released Monday at the National Assembly.
“The challenge will be very demanding.”
At a news conference to explain her findings, Roy conceded in the long run Quebecers could feel the pinch. A government can’t reduce spending growth from the 2.5 per cent foreseen for 2027-28 to one per cent in 2028-29 without someone noticing, she said.
“Yes, there is a risk that services to the population could be affected,” Roy said. “Seventy per cent of the (reduction) measures are to be put in place in the last two years of their (five-year) plan to balance the budget. That’s a lot of effort.”
She issued a warning to all political parties: They can’t get carried away with costly election promises without also explaining how they plan to pay for them.
“It will be up to the political parties to decide if they want to do additional projects, but if they do they will have to explain how they will finance them,” Roy said.
The auditor’s report creates the baseline to be used by the parties when they present their own campaign financial frameworks.
Roy outlines the perfect storm that looms: increasing uncertainty sparked by trade tensions with the United States, lower revenues from state corporations, stagnating population growth, aging infrastructure and inflation.
She explains the effects of slower economic growth on government revenues. While those revenues have grown, on average, by 4.8 per cent a year for the last 10 years, the number is expected to drop to 3.7 per cent from 2026-27 to 2028-29.
Roy’s report does not include the possible effects of more tariffs that the United States is threatening to impose on Canada starting this week, but at her news conference she warned they also could become a problem.
“This is a big factor of uncertainty,” she said.
Girard’s own projections are for slower growth in the coming years. A one per cent drop in GDP represents a drop of $1.2 billion in autonomous government revenues.
In his written response to the auditor general, Girard recognizes Quebec, like other jurisdictions, is facing an uncertain geopolitical and economic context, which makes balancing the books a challenge.
He defends his decision to not identify all the actions he will take to slay the deficit, saying he does not want to make hasty moves that could hamper the economy.
Girard said Quebec’s finances are fundamentally sound despite economic turbulence. His last budget included spending reductions totalling $3 billion in a wide range of areas.
The opposition parties were quick to argue the auditor’s report proves what they have been saying all along: The CAQ has lost control of Quebec’s finances.
Liberal finance critic Frédéric Beauchemin accused Premier Christine Fréchette of having spent $2.3 billion since becoming premier in April just to get herself re-elected.
Parti Québécois finance critic Pascal Paradis said it’s time voters take away the CAQ government’s credit cards.
“The CAQ’s heritage is condemning Quebecers to future cuts in health, education and infrastructure spending,” said Québec solidaire co-spokesperson Ruba Ghazal.
This is not the first time Quebec’s auditor general has warned the government about holes in its financial plan.
In November 2025, the auditor general said Girard’s plan to balance the books by 2029-30 was incomplete and failed to identify half of the measures needed to kill the deficit.
Girard’s March 2026 annual budget originally projected a $13.6-billion deficit for 2025-26. That number was revised downward several times and now stands at $7.8 billion.
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