The federal government ran a deficit of $11.5 billion over the first 11 months of its 2016-17 fiscal year, putting it well ahead of its spring budget forecast with one month to go.

The result compared with a surplus of $7.5 billion during the April-to-February period a year earlier.

Not counting a $3-billion contingency cushion, Ottawa's spring budget projected a deficit of $23 billion for 2016-17.

Story continues below advertisement

However Robert Kavcic, senior economist at the Bank of Montreal, cautioned that the government generally runs a large deficit in March as Canadians file their tax returns and receive their refunds.

"It is going to take us closer and the remainder is probably something that we've been seeing already for a while in that a lot of the stimulus spending is taking a little bit longer to get out the door than maybe originally thought," he said.

Ottawa ran a deficit of $9.4 billion in March 2016, $3 billion in March 2015 and $6.7 billion in March 2014.

The monthly fiscal monitor report said government revenue for the first 11 months of its 2016-17 fiscal year fell $400 million to $265.1 billion as personal income tax revenue fell, but corporate income tax revenue grew.

Program spending increased $20 billion to $254.6 billion.

Public debt charges fell $1.5 billion to $22 billion due in large part to lower average effective interest rates.

In a separate report Friday, the Parliamentary Budget Office forecast Ottawa will run a deficit of $20.7 billion for the 2016-17 fiscal year.

Story continues below advertisement

The PBO noted the prediction was $1.6 billion lower than it projected in October, due to higher estimated income tax revenue, especially from corporations.

However, the PBO said that compared with its October forecast that deficits over 2017-18 to 2021-22 would be on average $2.2 billion higher due to increased program spending.

"More than half of the projected spending increase reflects new policy decisions, such as the indexation of children's benefits as well as higher transfers to subnational governments for infrastructure and health care," the PBO report said.

"In addition, higher interest rates contribute to increased public debt interest costs over the medium term."