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Dear Friends,
The Spring Economic Statement revealed that the federal deficit for 2025-26 has reached $66.9 billion. This is more than double the $30 billion deficit projected by Mr. Trudeau in his final budget — a figure so alarming then that the former Finance Minister resigned rather than attach her name to it.
Many Canadians hoped that Mark Carney, a former banker, would bring a more prudent and responsible approach to federal finances. Unfortunately, Mr. Carney is deficit spending at twice the pace of his predecessor, Justin Trudeau. Canada’s federal debt now stands at $1.45 trillion for 2025-26 and is projected to rise to $1.63 trillion in 2026-27. This equates to roughly $39,300 in federal debt for every man, woman, and child in Canada.
But that’s not all. The government has also announced a $25 billion “Sovereign Wealth Fund” to invest in major projects. Unlike genuine sovereign wealth funds in countries such as Norway, this fund is not built on surplus wealth. It will be financed by borrowing an additional $25 billion, further adding to our already massive national debt. In reality this is a debt fund that will require taxpayers to cover interest costs before any returns can be realized.
Canada already has numerous similar funds and agencies, including the Canada Infrastructure Bank, the Canada Growth Fund, and the Strategic Innovation Fund. These have delivered mixed results at best. There is a serious risk that this new fund will simply duplicate existing bureaucracy, crowd out private investment, and prioritize political goals over sound financial returns.
Rather than borrowing more money to create yet another government investment vehicle, we should focus on fixing the root problem: removing the anti-development laws, high taxes, and excessive red tape that are driving investment out of Canada. Eliminating bad policy would do far more to attract private capital than another taxpayer-backed fund ever could. |
