OTTAWA—The blueprint for the federal Liberals’ growth-focused election platform shows how Mark Carney would change the government books with a new style of accounting and spend more than $129 billion to cut income taxes, boost the military, and crank up housing construction.
The spending was detailed in the Liberal party’s costed platform, which was released Saturday morning as voters continued to cast ballots in advanced polls over the Easter weekend for the April 28 election.
Much of the platform included previously-announced campaign promises, though it included some new commitments, such as a pledge to provide $20,000 for in vitro fertilization treatment.
For Carney, the plan lays out how he will cover his key election promise to galvanize the Canadian economy, boost government investments to make the country less reliant on the U.S. for its economic and security stability, all while reducing the operating costs of government. “I can count,” he said during the campaign.
The platform commits about $129.23 billion in new spending over four years. It also projects almost $52 billion in new revenue during that time, almost half of which — $20 billion — is expected in the current fiscal year from the payment of Canadian countertariffs on American imports. The countertariff revenue expectation is lower than the $24 billion previously estimated when the first three phases of Canadian duties on $94.8 billion worth of American products. A campaign official said that’s because Canadian consumers are likely to change their buying and importing habits as a result of higher prices on American goods. It also does not mean that a Mark Carney government would not expand countertariffs beyond the current level.
“America’s unjustified and reckless trade war has thrown the global economy into turmoil and Canada faces the greatest crisis in our lifetimes. This calls for a new approach focused on growth in the face of economic threats to weaken our economy,” the platform says. “Whereas the past required rebuilding public services after years of cuts and preparing the country for the recovery from COVID, now we must build our economic capacity by growing our capital stock. This plan reflects that.”
The biggest chunk of new spending is for lost revenues from the Liberals’ promise to lower income taxes by one percentage point for the lowest income tax bracket. The platform projects that will cost almost $22 billion by 2028-2029. Another $8.1 billion in revenue will be lost from cancelling the Justin Trudeau government’s increase to capital gains taxes.
The platform also commits around $18 billion in new spending on defence, including through increased pay for the Canadian Armed Forces and following through on previous plans to buy new heavy icebreakers, submarines, drones and “Canadian-made” early warning aircraft.
Another major focus is housing, with a promise to put $11.8 billion over four years to support builders of pre-fabricated homes through a new Build Canada Homes fund. The Liberals would also spend $6 billion by 2028-29 to cover new housing infrastructure like water, power lines, and wastewater systems to municipalities that cut housing development charges.
The platform also details $6.8 billion in spending to support “nation-building” projects like high speed rail, $5 billion to fund infrastructure to expand trade to other countries, and $4 billion to “construct and renovate” health care infrastructure.
Under the plan, a Carney government would continue running budget deficits of $62.34 billion in the current fiscal year, declining to $47.8 billion in 2028-29.
The Liberals, however, want to change the way those deficits are calculated, by splicing out government operational spending from capital spending. The platform defines capital spending as “anything that builds an asset” owned by the federal government, another level of government, or a private company. It includes spending on machinery, equipment, land and buildings, and government incentives for private investment, the platform says.
Earlier this year, Carney vowed to balance the government operating budget in three years, while using capital spending to spur the economy.
However, the Liberal platform shows that would be achieved four years from now, with the operating budget starting this year pegged at more than $9 billion in deficit, and showing a surplus of about $222 million four years from now, in 2028-29.
A Carney government would cap — not cut — the size of the public service, and ensure program expenses grow less than 2 per cent each year, compared with almost 9-per-cent annually since 2015.
The Liberals are also promising to launch a “comprehensive” review of government spending, which the platform says will focus on amalgamating service-delivery so there is one point of access for people to interact with government programs, “consolidating” grants from different government sources that serve similar purposes, and “significantly” reduce how much Ottawa spends on private consultants, and other changes like the use of artificial intelligence to make the government more efficient.
The platform says these changes will lead to “savings” of $28 billion by 2028-29.
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