By Don Newman

September 26, 2025

The federal budget countdown is on. November 4th is the date the Carney Liberal government will pull back the curtain on Canada’s finances and its plans for navigating the country through the economic wreckage created by the punishing and possibly illegal tariffs imposed by President Donald Trump.

Finance Minister Francois-Philippe Champagne will present his budget to the House of Commons after the markets close on the first Tuesday in November. The budget will set the stage for the government’s plans to reposition Canada as a more self-reliant, globally connected nation, less dependent on the United States and with greater domestic capabilities both economically and internationally.

Setting the stage for that new vision, Prime Minister Mark Carney has been logging considerable pre-budget legwork. He spent time in Atlantic Canada earlier this month touting major projects and tariff relief. This week, he had a breakfast meeting in Ottawa with the Taoiseach — Prime Minister of Ireland — to register the two countries’ bilateral affinity as middle powers and trading partners in a new global trading reality.

At this writing on Friday, he is in London meeting with Prime Minister Keir Starmer and Australian PM Anthony Albanese. Canada already has trade deals with both Britain and Australia, but invigorating them to take up some of the slack that will be created by the Trump tariffs is a primary goal.

The budget will set the stage for the government’s plans to reposition Canada as a more self-reliant, globally connected nation.

The budget will provide a first look at the plans for financing the military build-up Carney agreed to at the NATO conference in June. Those plans include up to 12 submarines with capabilities to operate in the Arctic, procured from two possible contenders, one a German-Norwegian consortium and the other in South Korean. All in, the cost is estimated at $120 billion, although the costs are almost certain to rise over time as all costs of military procurement do. A similar amount will be budgeted for the replacement fighters for Canada’s aging fleet of CF-18s. The good thing about all these costs is that they mostly don’t have to be paid up front.

The government will be at pains to show that on Budget Day. It will in effect table two budgets; an operating one with all the ongoing costs of running the government on a daily basis, and a capital one listing the costs of what the Liberals are characterizing as “investments” — like ships and planes and infrastructure projects — that will be paid- out over time but will likely come with healthy debt service charges to be paid annually after the money is borrowed through the operating budget.

Finance Minister Champagne has told cabinet ministers he wants them each to identify cuts to day-to-day spending in their departments of up to fifteen per cent over the next three years. Included in those cuts will be job losses in the public service and limits to some government spending programs.

Presenting two budgets may actually make sense but it won’t stop opposition politicians, financial analysts or journalists from quickly adding up the projected deficit in each and calculating how deeply the government is going into debt. The deficit is likely to be over 60 billion dollars, at least 10 billion and possibly higher than that forecast a year ago.

The challenge for the Prime Minister, his finance minister and the rest of the government will be to convince Canadians that the cuts in one budget and the spending in the other are necessary to transform this country, and transform in a way they want it to go. That process will begin November 4th.

Policy Columnist Don Newman is an Officer of the Order of Canada, and a lifetime member and a past president of the Canadian Parliamentary Press Gallery.