Canada's budget bets on sovereignty and housing

Carney unveils sovereignty budget

Prime Minister Mark Carney released his second federal budget on Thursday, titled Masters of Our Destiny.It commits C$142bn in new spending over five years, funded by better than expected oil revenues from the Iran War.

“That's what this budget does: it's the next big step in our action plan to make this country more independent, more sovereign.”

Budget focuses on three priorities

The budget lays groundwork for Canada to be less reliant on the US for trade. It also tackles affordability by promising billions to end homelessness and build new housing.

Deficit remains over fifty billion

Canada's deficit is over C$50bn, with no path to balance. Despite new spending, Carney has kept his previous fiscal goals intact. GDP growth is expected to outpace all G7 countries except the US.

Pressure to deliver relief

Canadians continue to feel squeezed by inflation and unaffordable housing. Average hourly wages have not kept up with inflation. Food bank usage has hit record highs.

Eleven point two billion for homelessness

The budget commits C$11.2bn over four years to combat homelessness, including funding for supportive housing, mental health and addictions treatment. Statistics Canada reported one in eight Canadian households have experienced homelessness in their lifetime.

Grocery benefit expanded

The government will boost a grocery benefit for low and modest income Canadians, estimated to provide C$2,570 for a family of four within one year.

Immigration levels held steady

Carney has opted to keep immigration levels flat. The government will maintain permanent resident admission at 380,000 people annually until 2028 and gradually reduce temporary resident arrivals to 370,000.

Forty four billion for tariff relief

Since March 2025, the Carney government has set aside nearly C$44bn in support for workers and businesses hit by US tariffs.The budget includes C$6.

Two point seven billion for space capability

Canada is the only G7 country without the capability to launch its own rockets. The budget earmarks C$2.7bn to developing Canadian space technology and launch infrastructure.

Arts and culture investments

Carney is promising a tax exemption on income from original and creative artistic works.The budget sets aside C$32.2m over four years to establish a free national digital library launching with at least two hundred titles.

Defence spending on drones and deterrence

A marketplace for Canadian made drones gets C$2.3bn over five years. More funding goes to Operation Reassurance, Canada's largest overseas deployment mission to deter Russian aggression in eastern Europe.