Federal Finance Minister Jim Flaherty re-confirmed in Thursday’s budget that the federal budget probably won’t return to surplus until fiscal 2016 (ending March 31) — and even that may be optimistic.

The projected surplus for 2016 is only $800 million, which is very small — just 0.3% of the projected $295 billion in each of revenue and expenditures for that year. Budget targets are often missed by far more than that. The 2011 budget, for example, forecasted a $19.4 billion deficit for the current fiscal year — and the estimate is now $25.9 billion, or $6.2 billion higher.

Weaker or stronger than expected growth is often the reason for budget misses. Last year’s budget assumed the Canadian economy would grow at 2.8% in 2012; in fact, it expanded by only 1.8%. As a result, revenue increased by only 2.2% instead of the projected 6.1%.

In addition, program spending rose by 2.9% instead of the planned 0.7% — even though Employment Insurance benefits were lower at $17.5 billion vs the $18.9 billion projected in the 2011 budget. Despite the lower economic growth, the jobless rate in 2012 came in at the 7.2% assumed a year ago.

The main reason for the higher than expected spending is the unexpected need for a $2.4 billion to cover an increase in liabilities at Atomic Energy Canada Ltd.

This year’s budget assumes moderate economic growth over the 2014-18 period, with 2013 at 1.8% and the next four years between 2.3% and 2.6% for a five-year average of 2.3%. That’s considerably less than the 2.7% growth expected in the U.S. but Canada is expected to lag the U.S. because our housing sector is now cooling while the U.S.’s is finally starting to recover from its deep plunge.

In light of the modest growth, Flaherty is counting on robust revenue increases averaging 4.6% a year as a result of closing tax loopholes and increasing tax compliance. That sounds easy enough in theory but finding tax evaders and getting them to pay up can be very difficult. And, if the additional tax revenue isn’t forthcoming, the budget may not be balanced until fiscal 2017 or later.

Flaherty is also counting on very moderate growth program spending — only 0.8% this year and averaging only 2.1% a year in 2014-18 — and that, too, may be very difficult to achieve.

Federal debt is currently estimated at $608.7 billion, or 33.5% of gross domestic product as of March 31. The budget projects an increase to $634 billion in fiscal 2015 and then a gradual decline.