To the Point for the Week of May 18, 2025
To the Point for the Week of May 18, 2025
A troublesome financial milestone approaches for Ontario. Prime Minister Carney decides to table a budget…in five to six months.
ONTARIO
Half a Trillion Dollars…
By 2027, that’s how much the province of Ontario will be indebted if current spending trends hold. Finance Minister Peter Bethlenfalvy laid out the daunting figure in the provincial budget’s medium-term projections last week, and it has analysts and observers questioning how on earth the province plans to stop the bleeding.
Half a trillion dollars would be a record-setting amount, and it means Premier Ford will have added $150 billion in debt over the course of his three majority mandates. Taxpayers will be on the hook for an annualized average of $1,000 per person this year alone. The government’s debt payments between 2025–2028 will total $51 billion, making it the fourth-largest line item in the provincial budget. The Premier defended his budget and the accruing debt, saying: “I don’t like debt… We have two choices in a budget: we can start cutting and slashing, which I don’t like doing, I never will, and I believe in reinvesting into our infrastructure, into our health care, hospitals and schools.”
In 2017, current Minister of Economic Development, Job Creation and Trade, Vic Fedeli, once lambasted Premier Kathleen Wynne for raising Ontario’s debt to $350 billion, saying, “These are numbers that boggle the mind of everybody.” He’s correct—the number does boggle the mind. It’s especially mind-boggling given that Premier Ford has now spent more and increased Ontario’s debt more rapidly than his predecessor, while also failing to lower the province’s debt-to-GDP ratio, which is expected to rise to 37.9% in fiscal year 2025–26, just below the 40% “danger zone.”
One may be inclined to give the Premier the benefit of the doubt. No one predicted COVID, and even fewer predicted we’d be in a hot trade war with the United States. Drastic times call for drastic measures. However, he continued Wynne’s spending plans after winning his first majority in 2018 and then increased spending the following fiscal year by $4.9 billion to a total of $163.4 billion, this despite cuts at various ministries. The Premier’s populist brand, coming into provincial politics, was wrapped in ending the gravy train at city hall and respecting taxpayer dollars. Alas, perhaps the Premier has become a victim of circumstance.
The Premier’s spending habits have kept public services stable and stoked Ontario’s industrial ambitions, especially in advanced manufacturing and EVs. But with debt climbing and interest costs mounting, the province is betting big on returns that may not materialize. If Ford’s industrial wagers don’t pay off, future governments could find themselves boxed in and unable to fund core services without tough trade-offs.
FEDERAL
Seeking Transparency and Specifics
Last week’s cabinet announcements and subsequent fallout proved to be a bit of a false start for the Prime Minister. Some reappointed cabinet ministers proverbially stepped in it during the media scrum after the first cabinet meeting. From Guilbeault throwing cold water on future resource development—despite no longer being environment minister—to Gregor Robertson’s comments on housing affordability, it seemed as though cabinet’s first meeting didn’t touch on the virtue of strict message discipline.
The most striking, alarming, and confusing statement that came out of that meeting was Finance Minister François-Philippe Champagne’s casual declaration that the government would not be tabling a budget during the spring session of Parliament. Champagne’s rationale for delaying the budget cited legislative priorities, economic uncertainty related to trade tensions with the United States, and a weak explanation that a fall economic update would serve as a mini-budget providing detailed fiscal guidance for the remainder of 2025.
There have been instances when a federal budget was delayed, such as after the 9/11 terrorist attacks, but it remains exceedingly rare, especially during a crisis. With that in mind, let’s break down Champagne’s rationale to delay the budget.
First, Canadians voted for Mark Carney because he was perceived as the elder statesman and wise in the ways of economics and finance. They placed their trust in the Prime Minister because they believed Carney, the former central banker, was the man with the plan. In times of economic uncertainty, especially when we’re being told there are explicit threats of economic annexation at the hands of the United States, the legislative priority from our point-of-view should be to clearly outline how you intend to spend money to protect the country from that threat, whether real or perceived. After all, as we noted in last week’s newsletter, Carney intends to spend $130 billion more than Trudeau pledged in Budget 2024.
If legislative priorities aren’t a good enough excuse to withhold a budget, Champagne’s fallback to “economic uncertainty” should be the very reason to introduce a budget: to create some certainty. A trade war with the world’s superpower is a crisis. Chrystia Freeland tabled a budget during COVID-19. Jim Flaherty tabled one during the worst financial crisis since the Great Depression. If those once-in-a-generation crises warranted a budget, one would assume that our spat with the United States does too. Canadian businesses, especially those exposed to U.S. tariffs, are seeking guidance from their government amid ongoing uncertainty. A budget would certainly provide that.
Lastly, we suspect the Finance Minister’s inclination to delay the budget in favour of a fall economic statement may be rooted in the hope that economic and fiscal conditions will improve slightly by then, allowing the government to take credit for improved outcomes without having done much. If that’s the case, it sets a troubling precedent for how this government plans to handle bad economic news. It certainly doesn’t inspire confidence that transparency is a governing principle. Transparency is precisely what many Canadians thought they were voting for with Mark Carney.
The fallout from the budget delay drew head-scratching from both the Right and the Left. Even Andrew Coyne admitted in a column that “we’d all been had.” Carney’s promise to do things differently didn’t just stumble out of the gate. It crashed. It forced him to course correct. By Sunday, the Prime Minister clarified the government would indeed table a budget in the fall. An obvious, necessary move. He couldn’t afford to let that albatross hang around his neck until then, especially if the economy continues to trend south (no pun intended). But a fall budget means the country will go more than 18 months without a formal budget document.
And the budget wasn’t the only thing missing. Canadians also noticed the absence of cabinet mandate letters, those once-standard documents that outlined each minister’s marching orders. Instead, Carney issued a single, blanket mandate letter that said very little and explained even less. Critics across the spectrum rightly called it what it is: a step backward for specifics and transparency.
Gone is the ability to track departmental priorities. Gone is the tool to compare promises with delivery. What remains is an opaque, top-down structure that concentrates power in the PMO. It was an approach Carney, ironically, once criticized. Under Trudeau, 38 individual mandate letters were made public in 2021. Today, there’s only one.
The concern isn’t just stylistic. It’s substantive. Without a budget and without mandate letters, Canadians are flying blind. They know the government plans to spend big, but not where, how, or why. They know ministers have jobs to do but not what they’re being held accountable for. And that silence speaks volumes.
Transparency isn’t a nice-to-have. It’s foundational to public trust. And while it’s still early days for the Carney government, that trust may already be wearing thin.
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ONpoint Strategy Group is all about helping clients make an impact where it counts. Specializing in government relations and strategic execution, our team—Nico Fidani-Diker, Mariana Di Rezze, Krystle Caputo, David Morgado, Christopher Mourtos, Ellen Gouchman, and Brandon Falcone—works closely with clients to navigate complex political landscapes and bring their goals to life. With a practical, results-driven approach, we build strong relationships, craft winning strategies, and make sure every step brings clients closer to meaningful outcomes. We’re passionate about making sure our clients are heard, supported, and positioned for success.
