Ottawa added another $5 billion to its 2009-10 budget deficit in September, the Finance Department reported Friday.

Spending has outpaced revenue for the fiscal year that started in April by $28.6 billion.

tp-flaherty-cp-306-6785368

Ottawa is on track to meet Finance Minister Jim Flaherty's latest prediction that the deficit will reach $56.2-billion for the fiscal year ending in March. ((Jim Ross/Canadian Press))

That means the government is on track to meet Finance Minister Jim Flaherty's latest prediction that the deficit will reach $56.2-billion for the full fiscal year.

That would be the biggest deficit in the country's history.

The economic downturn had led the government to spend to stimulate the economy but it has also cut Ottawa's revenues by $14.2 billion, or more than 12 per cent, reflecting a drop in personal and corporate income taxes and GST payments.

Corporate taxes were down almost 40 per cent, or $6.3 billion, in the first six months. Individual tax revenue dropped 7.5 per cent, or $4.2 billion, reflecting both tax cuts in the January budget and fewer people working.

GST revenue falls 17.9%

Canadians also paid $2.5 billion, or 17.9 per cent, less in GST than in the same period last year.

Stimulus programs such as cuts to income taxes, increased employment insurance payouts and the auto bailout cost Ottawa $11 billion up to the end of September.

Total spending by the government is up $16.3 billion, or 16.5 per cent, over the first half of the fiscal year, with EI payments to newly unemployed workers jumping 50 per cent, or $3.5 billion.

(With files from The Canadian Press)