Financing the Nation — Benchmark Canada

Pillar one of five

Financing the Nation

Can we afford to build?

Balance-sheet capacity, public and household — whether the government has fiscal room to finance ambition, and whether households can service the debt they already carry. We read affordability from both sides of the ledger: the sovereign's debt burden and the cost of carrying it, set against the leverage and repayment stress sitting on household balance sheets, because the capacity to build rests on both staying sound.

Pillar verdictWatch10 metrics

Hover or tap a tile Strong 4 Watch 3 Weak 3

The metrics

Consumer loan arrearsWeakInstalment loans 2.95% (3.1× since 2015) · auto & cards at series highs · all three rising · BoC/TransUnion Debt servicing chargesWatch$53.4B 2024-25 · now exceeds CHT · +162% since 2020-21 Debt-to-GDPWatch110.7% · rank 3 of 7 G7 · 2026 IMF projection Energy investmentWatchUpstream oil & gas capex collapsed to ~$21B (2020), recovered to ~$43B (2024) but still ~half its 2014 peak (~$81B) · oil sands −58% · capital didn't rotate: business investment/worker −16% vs US +26% Government deficitStrong1.2% of GDP 2024-25 · 2nd-smallest in G7 · primary balance back in surplus Household credit stressWeak~14.4% household DSR · highest in G7 · near 2023 peak · financial stress 2.23%, a new series high Household debtWeak173% of disposable income · rank 7 of 7 G7 · Q4 2025 Mineral explorationStrong#1 destination for exploration spend worldwide · US$2.3B in 2025 budgets · but the global pool is shrinking and discovery-stage work is being squeezed Mortgage delinquenciesStrong0.28% · 2nd-lowest in G7 · doubled since 2022 Tax share distributionStrongTop 1% pays 22.1% of income tax on 10.1% of income (2.19×) · burden ratio above the US (1.86×) & near a 40-year peak · top 5% pay as much as the bottom 90% · bottom half 5.0% · 28.5% of filers owe none

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A project of the Macdonald-Laurier Institute Led by Senior Fellow Kevin Vuong

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