![\"Mark](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/11\/20250314_103137_RideauHallSwearingIn_0087.jpg\"\/)
Premier Mark Carney promised action on climate change before he was elected, but the new federal budget suggests industrial initiatives are his government\u2019s top priority. Photo: Kamara Morozuk \/ The Narwhal<\/p>\nPrime Minister Mark Carney\u2019s first budget proposes cancelling or changing climate rules and initiatives, while cutting billions of dollars in planned environment spending and reorienting funds to \u201csupercharge growth.\u201d\u00a0<\/p>\n
The government tabled its 2025 federal budget documents in Parliament on Nov. 4. In a speech, Finance Minister Fran\u00e7ois-Philippe Champagne said the world is undergoing fundamental shifts that are upending the international order and hurting Canadian workers, and that \u201cbold and swift action is needed.\u201d\u00a0\u00a0<\/p>\n
That action includes weakening a key law that clamped down on industry greenwashing.<\/p>\n
It also includes drawing down spending at two federal agencies involved in environmental oversight, and winding down two high-profile climate programs: the Canada Greener Homes Grant and the 2 Billion Trees program.<\/p>\n
Premier Mark Carney promised action on climate change before he was elected, but the new federal budget suggests industrial initiatives are his government\u2019s top priority. Photo: Kamara Morozuk \/ The Narwhal<\/p>\n
The budget suggests Prime Minister Mark Carney\u2019s government is likely to scrap a Trudeau-era plan to put a cap on emissions from the oil and gas sector, while investing in largely unproven technology that proposes to lower emissions from fossil fuel production.<\/p>\n
\u201cWe will explore new markets and sell more of the best of what Canada has to offer. We will build here at home \u2014 stronger industries, nation-building infrastructures and millions of more homes for Canadians,\u201d Champagne said.<\/p>\n
\u201cWe will protect what matters most: our people, our communities and our sovereignty. And, we will empower Canadians by making life more affordable, creating new career opportunities and ensuring every generation can get ahead.\u201d\u00a0<\/p>\n
The federal budget is the government\u2019s plan for spending and financial priorities. As a result, it\u2019s considered a matter of confidence in Parliament, meaning failure to pass it would trigger an election. The Liberals have a minority and must get a few opposition members to vote with them or abstain from voting in order to pass the budget. The vote is expected to be held Nov. 17, after Parliament debates the budgetary motion this week and breaks next week for Remembrance Day.<\/p>\n
Cuts to planned spending at Environment, Fisheries and Oceans and other departments<\/p>\n
The government is proposing to cut a total of $1.3 billion in projected spending at Environment and Climate Change Canada over the next several years, in line with its push to meet savings targets and \u201cstreamline\u201d programs.\u00a0<\/p>\n
The spending cuts won\u2019t be fully realized until after 2030. They are projected to occur in portions each fiscal year, with a final portion listed as \u201congoing\u201d with no end date.\u00a0<\/p>\n
The budget indicated the cuts will be widespread, coming from eliminating activities and programs, as well as ditching some lease agreements and training contracts and combining or simplifying other activities like engaging with Indigenous communities.<\/p>\n
Carney\u2019s spending cuts also affect two key environmental agencies. The government said the Impact Assessment Agency of Canada, which ensures big projects are assessed for environmental and societal protections, was expected to lose $65.8 million in spending over several years. As the federal government pushes for increased development, particularly in natural resources, the agency functions as a checkpoint.<\/p>\n
The Canada Water Agency, which coordinates with provinces, territories and Indigenous communities to protect fresh water, would lose $5 million in spending over several years.<\/p>\n
Meanwhile Natural Resources Canada, the department that oversees the fossil fuel sector, is also seeing proposed spending cuts of $2.6 billion past 2030.<\/p>\n
That includes winding down programs like the Canada Greener Homes Grant, which provides loans for homeowners making energy efficiency upgrades, and ending the 2 Billion Trees program that supports tree-planting programs across the country but struggled to meet its own targets.<\/p>\n
And Fisheries and Oceans Canada is expected to see spending cuts of $736.7 million over several years. The government said the department would \u201cleverage artificial intelligence and other digital tools to modernize Canada\u2019s fisheries management system.\u201d\u00a0<\/p>\n
It also said it would scale back some efforts and wind down activities that \u201chave either achieved their objectives or for which alternative data sources exist.\u201d<\/p>\n
Government weakens anti-greenwashing law<\/p>\n
The government said it would be rolling back some of the stronger measures Canada put into law last year<\/a> to combat greenwashing \u2014 when companies make environmental claims without evidence.<\/p>\n The budget proposed removing two critical parts of Canada\u2019s Competition Act that were added in 2024 to crack down on greenwashing, and would also take away a newly added power of third parties to bring greenwashing complaints to the Competition Tribunal directly.<\/p>\n The government said these rules had been \u201ccreating investment uncertainty\u201d since they were introduced, and were \u201chaving the opposite of the desired effect.\u201d<\/p>\n But Conor Curtis, head of communications at Sierra Club Canada, said weakening greenwashing rules is \u201cmore than just a problem for the climate, it is a problem for the security of our democracy.\u201d<\/p>\n \u201cWhat we are seeing in the United States in terms of a breakdown of democratic processes, rights and freedoms, is in large part due to the spread of disinformation and specifically of climate denial,\u201d Curtis said in a statement.\u00a0<\/p>\n \u201cThis climate denial and delayist messaging has often been purposefully spread by oil and gas corporations to undermine democratic processes.\u201d<\/p>\n For years, six large oilsands companies organized under the lobby group Pathways Alliance \u2014 Suncor, Cenovus, Imperial Oil, Canadian Natural Resources, ConocoPhillips Canada and MEG Energy \u2014 had told Canadians through advertising campaigns at the Super Bowl, on public transit and on social media that they were \u201cmaking clear strides toward net zero\u201d and that they intended to achieve<\/a> \u201cnet-zero emissions from oilsands operations by 2050.\u201d\u00a0<\/p>\n The claim was related to their proposal to build a large carbon capture and storage network in Alberta using technology that has not been tested at that scale. The Pathways Alliance set about trying to convince the government to help fund large portions of the project.<\/p>\n But its net-zero claim was the subject of a formal complaint in 2023<\/a> by Greenpeace Canada. The environmental group said the companies were misleading Canadians because they had no plans to phase out oil production \u2014 and only intended to tackle the carbon pollution generated during their operations, not from burning the fossil fuels they produce.<\/p>\n Canada\u2019s anti-greenwashing rules were designed to scrutinize these kinds of sweeping environmental claims. They say any company\u2019s claims about the environmental benefits of a \u201cbusiness or business activity\u201d can be challenged if they aren\u2019t backed up with evidence in line with an \u201cinternationally recognized methodology.\u201d\u00a0<\/p>\n When these rules were introduced, fossil fuel companies and lobby groups immediately complained, saying they were vague or overreaching. The oil company alliance, for example, scrubbed their websites and social media feeds<\/a> of all claims it was trying to reach net-zero emissions.\u00a0<\/p>\n While the group said the move was \u201cnot related\u201d to the truth of its claims, one of the lawmakers who helped get the rule into place told The Narwhal at the time it was \u201cvery telling\u201d that the group had pulled information offline so soon after the rules came into effect.\u00a0<\/p>\n The alliance also told the Competition Bureau that the anti-greenwashing language created \u201csignificant legal uncertainty<\/a> for businesses making virtually any type of communication that relates to the environment or climate change, regardless of the purpose of the communication and the intended audience.\u201d<\/p>\n This fall, Carney announced that the Pathways Alliance proposal had the eye of the government and would be examined<\/a> for potential referral to its Major Projects Office, which is supposed to help get projects built quicker.\u00a0<\/p>\n The budget also commits to extending a key tax break for carbon capture investments \u2014 and it makes clear that the government is relying on the unproven technology for major emissions reductions going forward.<\/p>\n Climate strategy meant to help protect competitiveness of oil and gas sector<\/p>\n In the budget, the government also laid out its anticipated Climate Competitiveness Strategy, which \u201caims to maximize carbon value for money.\u201d\u00a0<\/p>\n The strategy is focused on Canada reducing its \u201ccarbon intensity,\u201d the measure of how much carbon pollution goes into making a single unit of energy \u2014 for example, the amount of emissions generated per each barrel of oil.\u00a0<\/p>\n By lowering the carbon intensity, the budget noted, Canada can sell more of its oil, gas, steel and aluminum to jurisdictions that are looking for \u201clow associated greenhouse gas emissions.\u201d\u00a0<\/p>\n \u201cLowering our emissions is critical to protecting the competitiveness of Canada\u2019s oil and gas and steel sectors,\u201d the budget stated.\u00a0<\/p>\n \u201cReducing emissions is not only essential for environmental reasons, but also a key factor in securing access to markets that prioritize sustainability.\u201d<\/p>\n Carbon intensity is not, however, a measure of the total level of emissions from energy production.\u00a0<\/p>\n While Canada\u2019s fossil fuel industry has lowered the emissions intensity for each barrel of oil it produces, the industry has also grown its oil production so its overall emissions have actually increased.\u00a0<\/p>\n Canada likely won\u2019t follow through with oil and gas emissions cap<\/p>\n The government said it would likely cancel plans to implement an emissions cap on the oil and gas sector\u00a0in its climate strategy, which would align with an emphasis on capturing carbon to lower emissions.<\/p>\n The cap is supposed to be phased in starting in 2026. It\u2019s meant to ensure oil and gas companies stick to their word<\/a> that they can cut emissions, by ensuring the sector slashed carbon pollution 35 per cent by 2032, compared with 2019 levels.<\/p>\n It would be the first time Canada has imposed these kinds of mandatory, overall obligations on the industry, which is the country\u2019s biggest carbon polluter.<\/p>\n As well, Canada, as the world\u2019s fourth-largest oil producer and fifth-largest natural gas producer, would be the only large oil and gas producer in the world to have an emissions cap on its oil and gas industry.<\/p>\n After key industry players lobbied hard against the proposal<\/a>, the Carney government has signalled it\u2019s been lukewarm on the idea, which began under former prime minister Justin Trudeau.\u00a0<\/p>\n In the budget, the government said the emissions cap would have only \u201cmarginal value\u201d in reducing emissions when its other programs \u2014 like implementing stronger regulations for methane, a significant greenhouse gas and the main component of natural gas \u2014 were kept in place.<\/p>\n The government said it was also supporting technologies like carbon capture and storage<\/a>, which are supposed to draw down carbon emissions from the sector. It also noted that large industrial emitters are still subject to a carbon pricing system<\/a> even though Carney cut the consumer carbon tax in the spring.<\/p>\n Canada will change the rules for industrial carbon pricing, electricity tax break and redirect clean fuel funding<\/p>\n The government said it would be changing the benchmark it uses to ensure the different provincial and territorial industrial carbon pricing systems meet minimum federal standards, but offered few details.\u00a0<\/p>\n It said it would set a new trajectory for the industrial carbon price \u201cthat targets net-zero by 2050.\u201d<\/p>\n The government is planning to engage provincial and territorial governments \u201cabout improvements to the benchmark\u201d and about pricing systems.\u00a0<\/p>\n The changes are coming after the federal government has been under pressure to explain what it would do if provincial carbon pricing systems don\u2019t comply with federal rules.<\/p>\n![\"A](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/11\/AB-landowners-falsetti-30.jpg\"\/)
The Liberals\u2019 new budget scraps some of the measures implemented in 2024 to combat corporate greenwashing \u2014 when companies make environmental claims without evidence. Critics fear ditching these regulations represents a threat to both climate and democracy. Photo: Isabella Falsetti \/ The Narwhal<\/p>\n![\"smoke](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/11\/AB-oilsands-Ft-McMurray-aerials-Bracken-028.jpg\"\/)
The federal government is focusing on reducing Canada\u2019s carbon intensity \u2014 how much carbon goes into producing a single unit of energy \u2014 but this measure neglects the total emissions created by energy production, including by the fossil fuel industry. Photo: Amber Bracken \/ The Narwhal<\/p>\n![\"Justin](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/11\/Narwhal-Justin-Trudeau-Olaf-Scholz-22-08-2022-Selena-Phillips-Boyle-20.jpg\"\/)
Former prime minister Justin Trudeau\u2019s government introduced a plan for an emissions cap on Canada\u2019s oil and gas industry. Carney\u2019s Liberals are prioritizing carbon capture and storage instead. Photo: Selena Phillips-Boyle \/ The Narwhal<\/p>\n
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Clean energy is a focus of the new federal budget, with a tax credit proposed for provincial and territorial Crown corporations investing in clean power projects. Previous environmental conditions for the tax credit have been eliminated, however. Photo: Leah Hennel \/ The Narwhal<\/p>\n![\"A](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/10\/foresttenure-saywardbc-taylorrodes-August20250043WEB.jpg\"\/)
Part of the new budget proposes initiatives for First Nations construction companies to bid on infrastructure projects and for Indigenous participation in the government\u2019s new fast-tracked projects. Photo: Taylor Roades \/ The Narwhal<\/p>\n