For anyone who might be under the impression that the federal government has been on a debt-fuelled spending spree over the last decade, the Liberals have a message in the 2025 budget – Don’t worry, nothing to see here.

In the opening pages of the budget, the government makes the bold-type claim that Canada has the lowest net debt among G7 nations. A few dozen pages later, the government gives a 30-year projection of the federal debt burden that shows a smooth decline over time. So, nothing to get excited about, right?

Not quite. The picture the government paints is not inaccurate, but it is, at a minimum, incomplete. There are many reasons – and at least three ways – to worry about Ottawa’s rising debt.

Canada looks like a paragon of thrift, according to the chart in the first page of the budget, and replicated below. General government debt as a percentage of gross domestic product is just 13.3 per cent, far lower than any of the other G7 industrialized countries. (General government debt includes not just federal, but also provincial and municipal borrowing.)

On the measure of general government net debt, Canada does emerge as a clear leader, just as the Liberals brag in the budget.

But there is a very large caveat. The net debt calculation includes not just liabilities, but assets. And in Canada’s case, that includes hundreds of billions of dollars in public pension investments held by the Canada Pension Plan and the Quebec Pension Plan. Those assets have been built up through excess contributions, and investment returns, with the aim of providing funds for future pension payouts.

There’s no subterfuge at work: those assets exist, and should be counted in any reckoning of net general government debt. But those assets are not accessible to Ottawa in the way that other assets, such as real estate, would be. For one, the CPP is jointly administered with the provinces (the QPP of course is managed within Quebec). More pointedly, the entire reason for the pension investment funds existing is so that they are available to fund future pensions. If Ottawa were ever to tap CPP assets – an extremely unlikely scenario – Canadians would face some combination of higher annual contributions or smaller........

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