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The Liberal government can point to some good news in the report, with the PBO anticipating the billions of dollars in new spending promised in Budget 2016 will bolster the Canadian economy, and that the broader federal fiscal structure is sustainable over the long term.

The PBO’s forecast of the budgetary deficit is, on average, $4.5 billion lower than what was projected in the March federal budget between 2016-17 and 2020-21.

For the current fiscal year, the PBO projects the deficit will be $20.5 billion, nearly $9 billion less than the $29.4 billion the Liberal government forecast.

Notably, the PBO expects the federal government will post a small $700-million surplus in the 2015-16 year that just ended, once numbers are finalized — far better than the $5.4-billion deficit the Liberals projected in the budget.

The PBO report reinforces the Opposition Conservatives’ argument that the former Harper government left the Liberals with a surplus. The Conservatives seized on it in the House of Commons.

“The Liberal budget does not add up,” interim Conservative Leader Rona Ambrose said in question period. “Good news, Conservatives did leave a surplus.”

But Finance Minister Bill Morneau doubled-down on the government’s claims that the Conservatives left the Liberals a deficit, despite what the PBO report says.

“In the last month of the year, revenues go down, expenses go up. The Conservatives left us with a deficit, as we will see,” Morneau said.