Interim budget officer says he regrets comment about feds' fiscal management

Jason Jacques says he learned a lot about the importance of choosing his words carefully in his first few months as the interim parliamentary budget officer (PBO).

His whirlwind ascent from obscure bureaucrat to high-profile thorn in the Liberal government's side began in late summer, when outgoing budget officer Yves Giroux's term was set to end without a formal successor in place.

Tapped over the Labour Day long weekend to step into the role for a six-month term, Jacques quickly made waves among parliamentarians and the media with his blunt assessment of Ottawa's fiscal management.

After Jacques released a fiscal forecast in September, he told MPs on a parliamentary committee that the current state of federal finances was "unsustainable," "shocking" and "stupefying."

Politicians and pundits seized on Jacques's comments ahead of Prime Minister Mark Carney's hotly anticipated first federal budget in November. The Conservatives held up his words as proof of the Liberals' "reckless" approach to spending.

But in a year-end interview with The Canadian Press earlier this month, Jacques said he would not have used those words if he could rewind the past three months.

"It was totally unnecessary," he said. "People make mistakes. And again, for myself, it was a learning opportunity."

Before stepping into the interim budget officer role on Sept. 3, Jacques was a mainstay of the office. He was recruited in 2008 by inaugural PBO Kevin Page.

Page, now head of the Institute of Fiscal Studies and Democracy at the University of Ottawa, publicly disagreed with Jacques's warning that Ottawa's finances were heading toward a "precipice."

He argued in a Public Affairs magazine piece published on Oct. 14 that while the Carney government's fiscal pivot was a big swing, its ambition matched the challenge posed by U.S. trade aggression.

The Liberal budget tabled on Nov. 4 posted a sizable deficit of $78.3 billion for this year, with steep but shrinking deficits over the horizon. It was presented as a "generational" investment plan to boost Canada's productive capacity and reduce its economic reliance on the United States.

Jacques said in his budget analysis that while the projections for federal finances appear sustainable in the long term, he believes the Liberals are unlikely to meet some of their new fiscal objectives.

In the interview, he acknowledged it's possible the economy surges as a result of the Liberals' economic pivot, to the point where Ottawa's fiscal position is greatly improved in the years to come.

But he also warned that if Carney's move to ramp up capital investments doesn't pay off, those higher spending levels will undermine the feds' capacity to absorb the next economic shock.