The federal deficit is likely to be closer to $400 billion because of the COVID-19 pandemic.

Finance Minister Chrystia Freeland delivered the Liberals fall economic statement Monday afternoon (Nov. 30).

Besides a projected deficit of $381 billion she also offered support to parents of school-aged children, $1 billion in spending for long-term care homes, and aid for the tourism and entertainment sectors.

The update was clear that a financial recovery will not begin until deep into next year and the deficit will not return to pre-pandemic levels until at least 2026.

Freeland says now is not the time to turn off the taps of spending and vowed not to make the mistake of the Conservative party following the 2008 recession when stimulus money was withdrawn.

Freeland’s update also tees up work already underway to craft a spring budget focused on an economic recovery. She says federal support for that will include a three-year stimulus plan worth up to $100 billion.