{"id":118208,"date":"2025-09-04T02:18:06","date_gmt":"2025-09-04T02:18:06","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/118208\/"},"modified":"2025-09-04T02:18:06","modified_gmt":"2025-09-04T02:18:06","slug":"carney-says-to-expect-both-an-austerity-and-investment-focused-budget-criticizes-trudeau-era-spending","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/118208\/","title":{"rendered":"Carney says to expect both an austerity and investment-focused budget, criticizes Trudeau-era spending"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

‘It\u2019s an austerity and investment budget at the same time. And that is possible if we\u2019re disciplined,’ Prime Minister Mark Carney said.Spencer Colby\/The Canadian Press<\/p>\n

The federal government will present both an austerity and investment-focused budget this fall, Prime Minister Mark Carney<\/a> said on Wednesday, as he criticized the sharp rise in spending under his predecessor\u2019s watch. <\/p>\n

Mr. Carney set expectations for the spending plan, which the government plans to release in October, at the start of a two-day cabinet meeting in Toronto. <\/p>\n

\u201cIt\u2019s an austerity and investment budget at the same time. And that is possible if we\u2019re disciplined,\u201d he said in French, responding to a question on whether the government\u2019s spending review means it\u2019s planning an austerity budget. <\/p>\n

\u201cThe rate of federal government spending over the last decade is more than seven per cent year over year. It\u2019s faster than the rate of growth of our economy,\u201d he added. <\/p>\n

The Prime Minister said that style of fiscal management at the federal level needs to stop.<\/p>\n

Carney\u2019s cabinet meeting to focus on infrastructure, trade and crime, ahead of Parliament resuming<\/a><\/p>\n

Mr. Carney\u2018s comments stand in sharp contrast with the former Liberal government\u2019s approach to fiscal policy. Former prime minister Justin Trudeau won the 2015 election on an anti-austerity platform and largely brushed off calls to rein in spending, resulting in a sharp increase in the size of the federal government.<\/p>\n

Kevin Page, the president of the Institute of Fiscal Studies and Democracy at the University of Ottawa and a former parliamentary budget officer, said Mr. Carney is signalling that a significant reallocation of government spending is on the way.<\/p>\n

\u201cOn the one hand, it\u2019s going to look like austerity, because we\u2019re going to see the first tranche of spending-review cuts, I suspect, in the budget,\u201d Mr. Page said. \u201cAnd on the other hand, the Prime Minister … is committed to these new spending priorities and they\u2019re enormous.\u201d <\/p>\n

He added that Ottawa\u2019s planned cuts wouldn\u2019t be austerity in the traditional sense because they wouldn\u2019t reduce the overall size of the government.<\/p>\n

Finance Minister Fran\u00e7ois-Philippe Champagne requested this summer that ministers submit plans by the end of August to reduce program spending<\/a> by 7.5 per cent in the fiscal year that begins April 1, 2026, followed by 10 per cent in savings the next year, and 15 per cent in the 2028-29 fiscal year.<\/p>\n

Opinion: After a busy start, Carney faces a season of impatience<\/a><\/p>\n

The spending review is part of Mr. Carney\u2019s promise to balance the operational budget \u2013 which he said would reflect the government\u2019s day-to-day spending \u2013 in three years.<\/p>\n

Ottawa would continue to run deficits to finance what Mr. Carney has described as investments, such as military and infrastructure spending. <\/p>\n

Asked if there were any areas of government that would not be touched by cuts, Mr. Carney said on Wednesday that health care spending, education transfers and transfers to individuals would not be affected. <\/p>\n

Tyler Meredith, former head of economic strategy and planning for Mr. Trudeau and former finance minister Chrystia Freeland, cautioned against reading into Mr. Carney\u2019s use of the word austerity. <\/p>\n

\u201cI don\u2019t think we should take anything away from this until we see the actual budget,\u201d he said, adding that the government plans to phase in cuts over time. <\/p>\n

However, Ottawa\u2019s reorientation of priorities will likely lead to some public service layoffs, Mr. Meredith noted, given that the government won\u2019t be able to move all workers affected by the cuts to other departments. <\/p>\n

\u201cWe should expect that there will probably be some churn in the public service that will cause some disruption,\u201d he said. <\/p>\n

Conservative Leader Pierre Poilievre criticized Mr. Carney for failing to cut any government spending since he took office earlier this year, and warned the upcoming budget will include a deficit larger than that of Mr. Trudeau.<\/p>\n

Economists expect a number of factors to push the federal deficit higher still, including Canada\u2019s commitment to meet the new NATO defence-spending target, the Liberals\u2019 election promises and a slowdown in economic growth. <\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: ‘It\u2019s an austerity and investment budget at the same time. And that is…\n","protected":false},"author":2,"featured_media":118209,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[49,48,44,714],"class_list":{"0":"post-118208","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-canada","8":"tag-ca","9":"tag-canada","10":"tag-news","11":"tag-politics"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/118208","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=118208"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/118208\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/118209"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=118208"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=118208"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=118208"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}