The Liberal government has finally tabled its budget, projecting a national deficit of $78.3 billion this year, fueled by a massive $38 billion increase in spending to a total of $581 billion.
Total debt is projected to reach $1.35 trillion by the end of this year, increasing to $1.59 trillion in 2029-30. Under the Liberal plan, Canada will pay $55.6 billion in debt interest charges next year, rising to $76.1 billion by 2029-30.
“Budget 2025 is an investment budget. We are making generational investments to meet the moment and ensure our country doesn’t just weather this moment but thrives in it,” said Finance Minister François-Philippe Champagne in a statement on Tuesday.
“This is our moment to build Canada Strong and our plan is clear – we will build our economy, protect our country, and empower you to get ahead. When we play to our strengths, we can create more for ourselves than can ever be taken away.”
Over the next five years, the budget allocates $115 billion to infrastructure, $110 billion to productivity and competitiveness, $25 billion to housing and $30 billion to defence.
According to the budget, its two fiscal anchors include balancing daily operating spending with revenues by 2028-29 and maintaining a “declining deficit-to-GDP ratio to ensure disciplined fiscal management for future generations.”
“Budget 2025 invests about $280 billion over five years to build new infrastructure, protect our communities, and empower you to get ahead. On a cash basis, this represents $450 billion,” it reads.
It allows for the possible end to the Liberals’ emissions cap in exchange for a higher industrial carbon tax and carbon capture.
Budget 2025 will also include a cut of 40,000 public service jobs over the next three years, $141 billion in new spending over the next five years and $51 billion in promised new savings.
“The Comprehensive Expenditure Review will rein in government spending—saving Canada $13 billion annually by 2028-29, for a total with other savings and revenues of $60 billion over five years,” reads the budget. “We will also take action to close tax loopholes and make sure everyone is paying their fair share.”
More than 75% of spending will address changes in the global economic landscape. Of that, 42% will go towards “protecting our sovereignty,” 36% to “bringing down costs for Canadians,” and 22% for “additional actions to support Canadians.”
The Carney government intends to maintain Liberal programs including the Canada Child Benefit, National School Food Program, Canada Disability Program, Old Age Security, Student Loan and Grants, $10-a-day Child Care, Workers Benefits and Dental Care.
The Carney government will require at least three votes from opposition party MPs for its budget to pass in the House of Commons. The vote will take place before the end of the month.