We need some fiscal clarity, Prime Minister Carney
Prime Minister Mark Carney and U.S. President Donald Trump. / TWITTER PHOTO
Prime Minister Mark Carney has set out an ambitious vision for Canada: billions in new spending on infrastructure, military equipment, housing and transportation, all aimed at boosting long-term economic potential. In normal times, this kind of forward-looking investment would be welcome news. But today’s economic landscape is anything but normal — and that’s why greater clarity on how these promises will be funded is essential.
There’s no doubt the government faces significant challenges. Trade tensions, tariffs on steel, aluminum and vehicles, and a slowdown in key sectors are weighing heavily on growth. Deloitte’s summer economic outlook projects Canada’s real GDP will expand by just 1.1% this year, with a modest recession now likely. Manufacturing has already lost 55,000 jobs since January, exports have fallen sharply, and Ontario and Quebec — especially vulnerable to tariff impacts — are bracing for some of the weakest growth in the country.
On top of these pressures, uncertainty is taking its toll. Deloitte highlights that policy uncertainty in Canada now exceeds levels experienced during the pandemic, undermining business and consumer confidence. In this environment, it’s understandable that some are looking for reassurance. Parliamentary Budget Officer Yves Giroux has urged the government to provide, at minimum, an economic and fiscal update. And that’s a reasonable request.
Legitimate questions
To be fair, there are valid reasons for waiting until October for a full budget. The government is contending with a complex global environment — including a trade war — and a shortened spring sitting of Parliament due to the election. Crafting a comprehensive fiscal plan takes time, especially when conditions are shifting. But that doesn’t mean Canadians should be left entirely in the dark. A fiscal update, offering a snapshot of the government’s current outlook, its near-term assumptions and how new spending commitments fit into the broader fiscal picture would help address legitimate questions without forcing premature decisions.
Carney’s promises of protecting social programs while modernizing government operations through technology are commendable. But as Giroux notes, savings from innovation are unlikely to materialize quickly. A fiscal update could clarify how the government plans to manage the short-term pressures while laying the groundwork for those longer-term reforms.
Confidence among Canadians, businesses and global investors thrives on transparency. An October budget makes sense. But a fiscal update before then would help ensure that Carney’s ambitious plans rest on solid, credible ground.
