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CP NewsAlert: Budget watchdog says NATO 5% pledge to hike deficit by $63B

  • The Canadian Press

  • Canadian Press

  • February 5, 2026

Interim Parliamentary Budget Officer Jason Jacques speaks with a senator as he waits to appear before the Senate Banking, Commerce and the Economy committee in Ottawa, Thursday, Oct. 2, 2025. THE CANADIAN PRESS/Adrian Wyld

OTTAWA -- Prime Minister Mark Carney's pledge to NATO allies that Canada will spend the equivalent of five per cent of GDP on defence will cost the country an extra $33.5 billion a year, the Office of the Parliamentary Budget Officer says.

A PBO report released today says all that extra defence spending will push up the federal budget deficit by $63 billion by the 2035-36 fiscal year.

More coming.