Carney defends ‘bold’ Budget 2025 as critics question scale of investment

By Canadian Press on November 5, 2025.

OTTAWA — The federal budget is a “bold response” to a global moment of economic disruption, Prime Minister Mark Carney argued Wednesday, replying to critics who question the ambition of Ottawa’s plans.

“These profound changes require a bold response, and that’s what we got yesterday,” Carney told a news conference in a public transit yard in Ottawa.

The budget predicts that, in terms of real GDP, Canada’s economy will be 1.8 per cent smaller by the end of 2027 than forecasts suggested late last year — before U.S. President Donald Trump launched his global tariff campaign.

Carney claimed measures in the budget will help Canada meet a lofty goal of attracting $1 trillion in investment over the next five years. That level of investment, if it comes to pass, would more than offset the disruption caused by U.S. tariffs.

“Now is not the time to be cautious, because fortune favours the bold. It is a time to get big things done for Canadians, and get them done fast,” he said.

Wednesday marked the start of Carney’s campaign to sell Canadians on the first government budget released under his watch.

He was joined at the event by Nova Scotia MP Chris d’Entremont, who left the Conservative caucus to join the Liberals on Tuesday, moving them within two votes of a majority.

They’ll need to find those votes — or abstentions — if they are to get the budget passed and survive a confidence vote which could trigger a federal election.

The budget includes nearly $90 billion in net new spending over five years, after government cost-savings goals are taken into account. The plan has received a lukewarm reception from opposition leaders.

Carney said there’s “a lot in this budget” that reflects input from other parties. He said there’s alignment across the government and opposition parties on aspects of the budget.

Peter Bethlenfalvy, Ontario’s finance minister, said Wednesday he spoke to his federal counterpart after the budget was released and described the spending plan as lacking “some ambition.”

“It’s less transformational. It’s more tinkering,” he told reporters at Queen’s Park.

Bethlenfalvy said the budget falls short on infrastructure support for the provinces and further tariff relief for the auto sector that supports the economies of many southwestern Ontario cities.

Carney was touting a 10-year, $51 billion fund for local infrastructure — bridges, roads, hospitals and transit systems — in Ottawa on Wednesday morning.

TD Economics said in a report that much of the budget’s new investments, such as the local infrastructure fund, are the result of reallocation from other pools of funding rather than net new money.

TD Bank economists said only $9 billion of the funding for local infrastructure over five years in Budget 2025 was new money.

The federal government is pitching an increase in capital funding from $32.2 billion this year to $59.6 billion by 2029.

In commentary published online in The Hub, University of Calgary economist Trevor Tombe pointed out that only $8.3 billion of that increase is actually new, and much of it is spent on transfers to provinces.

“That’s roughly 0.2 per cent of GDP and in line with commitments seen in many previous budgets. So, for all the hype, this budget does little that’s ‘generational,'” Tombe wrote.

Carney pushed back Wednesday against critics and analysts who said the budget does not do enough to encourage investment.

He argued the budget offers a “sea change” by reducing operational spending growth from eight per cent annually to less than one per cent while ramping up government capital investment.

Adjustments to the tax code allowing businesses to write off their own capital spending in the first year also make the country a more attractive place to invest in the face of protectionist U.S. policies, he said.

“Look, I’ve been around a lot of budgets,” he said. “This is a very different budget.”

The TD Economics report said the accelerated capital spending expensing measure and enhancements to the existing scientific research and experimental development tax credit “do put Canada on somewhat more even footing” with the United States.

U.S. President Donald Trump’s One Big Beautiful Bill Act also included immediate expensing for businesses.

Tombe called that measure — dubbed the “productivity super-deduction” in the budget — a “bright spot” that could help spur manufacturing investment in Canada.

“Unfortunately, while a real step to encourage private investment, potentially boosting GDP by 0.2 per cent (the government reckons), it’s a temporary measure, so its long-term impact is muted,” he wrote.

Bank of Canada governor Tiff Macklem is expected to face questions about the budget when he appears Wednesday afternoon at a House of Commons committee meeting.

This report by The Canadian Press was first published Nov. 5, 2025.

— with files from Catherine Morrison in Ottawa and Allison Jones in Toronto

Craig Lord, The Canadian Press