TORONTO, June 1 (Reuters) - Ontario said on Monday the cost of bailing out General Motors Corp GM.N will cause it to run a deficit of C$18.5 billion ($17 billion) in the current fiscal year, 31 percent more than it forecast in March.

The governments of Canada and Ontario, the country's most populous province and home of most of its auto sector, said earlier on Monday they would provide a C$10.5 billion rescue package to GM. [ID:nN01160587]

"We made contingencies in our budget for the anticipated investment in the auto company, but it was more than originally anticipated," Alicia Johnston, a spokeswoman for Ontario Finance Minister Dwight Duncan, told Reuters.

"So it's partly due to that reason but also due to the continuing economic and financial crisis and declining revenues."

Ontario said in March it would run a deficit of C$14.1 for the 2009-10 fiscal year and not balance the budget again until 2015-16. [ID:nN26512563]

($1=$1.09 Canadian) (Reporting by Frank Pingue; Editing by Jeffrey Hodgson)