Deficits do no harm as long as the debt-to-GDP ratio does not grow, a cross-partisan panel of five economists at the University of Ottawa agreed on Tuesday.

“The burden of the debt, defined as … the debt-over-GDP ratio, We want to keep (debt over GDP) stable to not burden future generations,” said Andrew Sharpe, executive director of the Centre for the Study of Living Standards. “You don’t have to have a balanced budget to do that. You can have a deficit of over $25 billion and still have a stable debt-to-GDP ratio, which is approximately 31 per cent of GDP.”

With two of the three major contenders for prime minister — Conservative Leader Stephen Harper and NDP Leader Tom Mulcair — zealously pledging to deliver balanced budgets if elected on October 19, Tuesday’s consensus suggests that political messaging, not economic reason, underpins balanced-budget pledges.

The panel, hosted by iVote/jeVote, comprised Pedro Antunes, deputy chief economist for the Conference Board of Canada; Sharpe; Scott Clark, a former federal deputy minister of finance; David Macdonald, senior economist for the Canadian Centre for Policy Alternatives; and Jim Stanford of Unifor.

“If you are concerned about debt, there actually is a much more important debt besides federal and provincial debt; it’s household debt, or private debt,” said Macdonald. “And I think that is where one of our biggest long-term problems will come.”

Macdonald blamed the two-decade-long rise in household debt — which now stands at over 160 per cent of GDP — on Canadians’ mortgage debt, the sustainability of which is staked on home prices.

“This is not the time for balanced budgets,” said Clark. “We need governments to run some deficits, to create some debt, but not have the debt burden go up.”

NDP Leader Tom Mulcair spoke after the panel discussion, where he reiterated his party’s balanced-budget promise.