Budget forecasts remain intact: Flaherty

Finance Minister Jim Flaherty said he's been assured by private sector economists that projections used for the March budget are in line with current forecasts, despite recent economic developments.

"We will not be tweaking the forecasts," Flaherty told reporters after meeting with private sector economists in Toronto.

Next week, Flaherty will unveil the government's budget. It's expected to be very similar to the one the Tories unveiled before the recent federal election. Although some components may see adjustments, the underlying financial assumptions for how Canada's economy will perform for its duration won't change significantly, he said Tuesday.

"The average forecast provided in the March 22 budget remains a reasonable basis for the June budget," he said.

Based on consultations with those same private sector economists, that budget was assuming real GDP growth of 2.9 per cent for the year.

Flaherty said as the government winds down its stimulus program, it's extremely important that the private sector picks up the slack and invests in new machinery, equipment and hiring to keep stimulating the economy.

'We want to get the unemployment rate down.' —Jim Flaherty, finance minister

So far, the government has seen encouraging signs of that happening, but more is needed, he said.

"We need the private sector the step up to the plate to invest and grow," he said.

Although he won't deviate much from the projections, the finance minister said he is concerned by a number of developments in the global economy.

Chief among them is the sovereign debt crisis that's sweeping across Europe, with Greece being the main focus right now, Flaherty said.

But ongoing issues in the United States with their debt and deficit remain a concern. "There is a need for both situations to be resolved," he said.

And unemployment remains an issue.

"We have some persistent unemployment in Canada that needs to be addressed. We want to get the unemployment rate down," he said.