Canada's provincial and territorial governments are in a tenuous position. A Difficult Road Ahead: Canada's Economic and Fiscal Prospects provides an estimate of potential economic growth in Canada over the longer term. It also provides a detailed modelling of health care spending that accounts for demographic changes, trends in technology and access to services, and trends in cost drivers in these sectors, over a long-term forecast horizon.
Collectively, Canada's provinces and territories are expected to record a combined budget deficit of $16.1 billion in fiscal year 2013–14. According to this report, the provinces will have to make substantial cuts to spending outside of health and education in order to balance their books. Even after the provinces return to balance, they will have to retain tight control on spending growth, the result of slower expected revenue growth due to an aging population.