Federal deficit shrinks further in December

The federal deficit for this fiscal year reached $27.4 billion by the end of December, the Finance Department reported Friday.

That was well down from the deficit of $39.4 billion by the same time in 2009.

The shortfall in December was $1.4 billion, compared with $3.1 billion in December 2009.

With three months of the fiscal year still to be accounted for, Ottawa is headed to come in below its $45.4-billion deficit target.

Last week, parliamentary budget officer Kevin Page suggested the government will post a deficit of under $40 billion this fiscal year.

The government says revenues increased in December by 1.6 billion, or 8.4 per cent, from the same month a year earlier, coming mostly from personal and corporate taxes.

Government spending on programs was down $500 million in December, or 2.5 per cent. Public debt charges increased by $300 million.

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