Economic Development Minister Raymond Bachand says the province's deficit will be higher than projected last spring. (CBC)

Quebec's deficit will exceed the $3.9 billion forecast in last March's budget even though the province has been less affected by the global recession than other jurisdictions, Finance Minister Raymond Bachand said Monday.

But speaking a day before his economic update, Bachand said the deficit won't be anywhere near the amounts recently posted by the Ontario and federal governments.

"The bottom line is that Quebec's finances are in control and Quebec's economy is doing much better than its neighbours," he told reporters after addressing a financial regulator's conference.

Quebecers are losing jobs but a much lower rate than in Ontario or Canada as a whole or the United States because the province has been more stable during the recession, he said.

'I think our manufacturing base is smaller so there's less harm that's been done to the Quebec economy by this global recession than to the Ontario economy,'—Lorne Switzer, Concordia University professor

Bachand credited the position on decisions by the province's Liberal government to massively invest in targeted infrastructure and other projects.

"The deficit that we are anticipating is one of the lowest in industrialized countries," he said.

Ontario has forecast a $24.7-billion deficit for the fiscal year, nearly double the amount included in its March budget, and higher than the $18.5 billion predicted in June.

Ottawa expects to be $55.9 billion in the red this fiscal year. That's up from $50.2 billion forecast in June and $33.7 billion included in its January budget.

Bachand said Quebec is aiming to balance its budget in about four years, thanks to cost-cutting and new revenues from a higher sales tax.

The minister refused to say whether Quebecers will face years of pain to restore the province's financial balance.

"I wouldn't put it in terms of pain, I'd put it in terms of what are the values of Quebec," he said.

Once Quebecers decide what kind of health care, education, family and culture systems they want, then it becomes how do you pay for it, he said.

Bachand said he will address those options Tuesday and hinted there may be a few surprises.

Concordia University professor Lorne Switzer agreed that Quebec is in better shape than others because of how its economy is diversified.

"I think our manufacturing base is smaller so there's less harm that's been done to the Quebec economy by this global recession than to the Ontario economy," he said after the speech.

Quebec defends financial regulator

The finance minister said Quebec will continue to defend its view that Ottawa's effort to establish a national securities regulator intrudes on provincial jurisdiction.

"Quebec is not against a Canadian system," he told the conference sponsored by Quebec's securities regulator, L'Autorité des marchés financiers.

"We are an ardent promoter of a Canadian system. It takes a national system in Canada, but national doesn't mean central."

The creation of a national accounting board that harmonizes provincial accounting standards is a model of a national securities system, he said.

Bachand said a single regulator is neither in Quebec's nor Canada's interest. And he questioned why Ontarians aren't opposed.

"If I was an Ontarian, I'd be ashamed to think that my provincial institution is not competent enough to deliver an efficient Canadian system and working in co-operation with Quebec, Alberta and B.C."

Bachand said the current system is efficient, not more costly and just as able to deal with cases of fraud.

Scandals involving Bernard Madoff, World Com, Tyco and Parmalat all took place in the U.S., Italy and Switzerland which have single national regulators.

Earlier, Bank of Canada governor Mark Carney waded gently into the debate over a single national regulator in Canada, but refused to say whether he recommends that provinces get on board.

Carney noted that he regularly meets and talks with the heads of Canada's 13 regulators and that everyone is working within the current system to do the best possible job.