What’s Next for Carney Government After Surviving Budget Vote

News Analysis

Prime Minister Mark Carney narrowly passed his first budget on Nov. 17, as opposition parties were reluctant to trigger an election, and the focus will now turn to implementing the budget plan.

Many initiatives are being pursued in that regard, as Ottawa tries to expedite major projects, get back to the negotiating table with the Trump administration to address sectoral tariffs, prepare itself for the upcoming review of the Canada-United States-Mexico free trade agreement, diversify trade to markets beyond the United States, and secure foreign investments.

On the trade and investment front, Carney had plans to leave on another foreign trip a day after the key budget vote, this time with a stop in the United Arab Emirates (UAE) before attending the G20 Summit in South Africa.

Carney is banking on his budget containing massive infrastructure spending and business-friendly measures to attract fresh money to boost Canada’s economy amid global turbulence and sluggish domestic productivity.

With cost-of-living concerns remaining high for Canadians and large-scale initiatives taking time to deliver results, a Liberal strategist says that Budget 2025 is a kind of gamble in terms of attracting investments and generating growth.

“The budget constitutes something of a roll of the dice in terms of the federal government’s ability to attract billions, tens of billions, hundreds of billions of dollars in new investment from the private sector, both at home and abroad,” Charles Bird, principal at Earnscliffe Strategies, told The Epoch Times.

Ottawa says its budget measures will enable more than $1 trillion in total investments in Canada during the next five years.

Bird noted that Carney’s trip to the UAE at this time, the first for a prime minister since 1983, is not a coincidence, with the country’s sovereign wealth funds managing trillions in assets.

“Those sovereign wealth funds are a significant global driver of investment, and I think it’s very telling that the prime minister has chosen to go there as part of his current international travel,” he said.

The opposition parties, including the Conservatives and the Bloc Québécois, have criticized the budget’s projected $78.3 billion deficit for the current fiscal year 2025–26. The Conservatives argued that the high level of spending will fuel inflation and that maintaining taxes such as the industrial carbon tax will deter investment.

The NDP, meanwhile, wanted fewer cuts to public service funding and more climate initiatives, while the Bloc called for higher Old Age Security payments and increased health transfers to the provinces.

The Liberals say the budget provides necessary funding to maintain key services, supports economic growth and Canada’s defence capabilities, and includes needed reductions to government spending.

Domestic Politics

In terms of domestic politics, the minority Liberals should be safe for some time, according to Bird, who said getting the budget through has bought them another year. As a way to avoid the drama around future confidence votes, Bird added, there could be further courting of opposition MPs by the Liberals to join their caucus in order to overcome the two-seat gap needed to form a majority government. Meanwhile, any policy concessions to secure opposition votes aren’t likely at this point, he said.

After Nova Scotia MP Chris d’Entremont left the Conservatives on Nov. 4 to join the Liberals, the governing party now holds 170 seats in the House of Commons, two short of a majority.

While the Tories voted against the budget, it remains unclear whether they were ready to oppose the budget to the point of wanting to trigger an election, according to Peter Graefe, associate professor of political science at McMaster University.

Tory MPs Andrew Scheer and Scott Reid were both in Parliament but missed the in-person vote on the budget in the House of Commons. After the budget motion passed due to abstention by two NDP MPs, the two Tories entered the House and both raised points of order, saying they had difficulties voting electronically and wanted to vote “no.”

Graefe noted that Scheer, as a former House Speaker and current Opposition House Leader, would unlikely miss such a key vote due to a technical difficulty.

“It’s hard not to see them having made a decision to hold back until they could be certain that the NDP was going to pull two people back before going to vote,” Graefe told The Epoch Times in an interview. The Conservative Party was contacted for comment but a response was not received by publication time.

Meanwhile, two Conservative MPs, Shannon Stubbs and Matt Jeneroux, didn’t vote on the budget. Stubbs’s office said she was recovering from a major surgery and was under strict bedrest orders by her medical team. It wasn’t immediately clear why Jeneroux abstained. The Edmonton MP said on Nov. 6 that he would be resigning from Parliament next spring. He made this announcement amid rumours that he was considering joining the Liberals, which he denied.

All Bloc MPs voted against the budget, while the Green’s Elizabeth May voted in favour. May had initially said she couldn’t vote “yes” on the budget in its current form and demanded more environmental policies, but she changed her stance after getting Carney to make a public commitment to the Paris Agreement climate objectives.

Five of the seven NDP MPs voted against the budget, while MPs Lori Idlout and Gord Johns abstained.

Interim NDP Leader Don Davies said his party finalized plans on the morning of Nov. 17 to vote against the budget while allowing two MPs to abstain, so as to ensure the budget passed and to avoid a second election in 2025. He added that his party didn’t obtain any concessions for allowing the budget to pass.

“We pushed the Liberals to give us some concrete results, but nothing happened. So we decided to vote ‘no,’ but in order to avoid an election, we did what we had to do,” Davies said on Nov. 17 after the vote.

Graefe said this decision by the NDP reflects the “weakness” the party is experiencing, having lost official party status in the last election, being in the midst of a leadership race, and not having a healthy financial situation.

This situation with the opposition parties will give the minority Liberals more time to govern, according to Nelson Wiseman, professor emeritus of political science at the University of Toronto. He adds that the situation could change if there is “some spectacular scandal or a series of small scandals that really undermine the Liberals and Carney specifically.”

Wiseman says that if the Liberals manage to recruit more opposition MPs and form a majority government, they could implement more controversial policies in future budgets, such as an increase of the GST that the Business Council of Canada recently featured in its 2025 budget consultations report.

Opposition parties, meanwhile, say publicly that they’re ready to bring down the government.

“We’re prepared to do that in the spring,” NDP’s Davies said on Nov. 17.