Canada

Photo: The Canadian Press. All rights reserved.

Finance Minister Jim Flaherty speaks in Ottawa on March 1, 2013. THE CANADIAN PRESS/Sean Kilpatrick

The federal government will take a "significant" hit from Canada's weaker economic growth prospects, but will still be able to balance the books in time for the next election in 2015, Finance Minister Jim Flaherty said Friday.

Flaherty delivered the message after meeting with about a dozen private sector economists who travelled to Ottawa to warn that 2013 will be weaker than expected.

The government did not release a new consensus figure, but interviews with the economists showed their projections range from a low of 1.5 per cent to a high of 1.8 per cent. That's below the two per cent advance Ottawa had counted on for the November update and well south of the 2.4 per cent projection contained in last spring's budget.

"How much of a kick are we going to take on the revenue side because of lower nominal GDP? Significant. It's significant,” said Flaherty during a question-and-answer period.

Still, the minister said the government is on track to balance the budget by the fall of 2015 and plans to close tax loopholes, like foreign havens used by people to avoid taxes.

It also plans on controlling spending to make up the difference.

"We will manage it," said Flaherty. "The key is looking forward to the next two years and making sure we stay on track. There's a number of measures we can take to do that and you'll see them in the budget."

Flaherty said Canadians will need to wait for the budget, expected in late March, for specific details on his approach. The one certainty, he said, is that Ottawa will not cut funding for skills training.

"It's too important," he said. "It's a priority of the budget."