Political parties and their leaders are not always known for fulfilling their pledges. This week’s budget presents an opportunity to assess some of the commitments made by Prime Minister Mark Carney and the Liberal Party during the recent election campaign. Have these promises materialized?
We cannot cover every aspect comprehensively. Some budget components were not tied to specific campaign assurances, and some promises do not directly impact the budget.
However, certain key priorities of Carney’s administration can be evaluated.
The Trade Dispute
Following the imposition of 25% tariffs by U.S. President Donald Trump on Canadian steel and aluminum in March, as well as on Canadian-made vehicles in April, the Liberal platform pledged to generate $20 billion from retaliatory tariffs in the current fiscal year.
Nonetheless, the latest budget indicates an anticipated collection of only $4.4 billion, primarily due to the reduction of most countermeasures against American goods in August to facilitate discussions with Trump. Furthermore, numerous Canadian companies have been exempted from counter-tariffs.
To date, tariffs have generated $3.7 billion in net revenue, with the possibility of a decrease as more Canadian firms request relief from counter-tariffs. The government has allocated up to $25 billion over five years to support sectors severely impacted by the trade dispute.
NATO Defense Commitments
Under pressure from Trump, the Liberals committed during the campaign to raise Canada’s defense spending to two percent of GDP by 2030, a benchmark adopted by all NATO nations. However, Canada has not met this commitment.
After the election, Carney, once again pressured by Trump, agreed to further increase the NATO commitment to five percent of GDP (including 1.5 percent for infrastructure support).
In the budget, Finance Minister François-Philippe Champagne stated that Canada will achieve the two percent target this year, ahead of the original schedule. Nevertheless, the budget lacks specific figures to verify compliance with the commitments, as it does not provide a detailed breakdown of defense spending over the years.
Ramping Up Housing Construction
During the election campaign, the Liberal Party under Carney proposed constructing 500,000 homes annually, doubling the existing rate. This initiative involved establishing Build Canada Homes, a new agency that would invest $10 billion in constructing affordable housing and provide $25 billion in loans to developers.
The government launched Build Canada Homes in September, allocating $13 billion over five years for its operation, describing this as an “initial” investment. However, the promise has been slightly scaled back, with the budget now aiming to “nearly” double homebuilding to between 430,000 and 480,000 units annually.
Investment in Artificial Intelligence
Artificial intelligence (AI) is hailed as a groundbreaking technological advancement, attracting substantial investments from private firms and governments. However, the budget falls short of the Liberals’ campaign commitment in AI funding.
While Carney pledged $2.5 billion for digital infrastructure like chips and data centers over the next two fiscal years, along with $15,000 for workers in priority sectors to acquire AI skills, the budget only promises $925 million over five years for public AI infrastructure, with $800 million previously announced in the last year’s budget.
The government plans to seek private capital for AI investment, although the specifics remain vague.
CBC Funding
Notably, the budget revealed plans for the government to collaborate with CBC/Radio Canada to explore participation in Eurovision. Although this was not a specific campaign promise, the Liberals did pledge an immediate $150 million increase in funding for the CBC during the campaign. The budget includes this funding boost and hints at enhancing CBC’s independence, aligning with the campaign commitment.