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Federal government narrowly approves 2025 budget with $78.3 billion deficit

November 27, 2025   ·   0 Comments

By Sam Odrowski, Local Journalism Initiative Reporter

Prime Minister Mark Carney’s minority Liberal government approved its 2025 spending plan last Monday, passing with a narrow 170-168 vote.

The federal budget, which had $585.9 billion in expenses and $507.5 billion in revenue, ran a $78.3 billion deficit. While this is the largest non-pandemic year deficit the Government of Canada has ever run, the Liberals argue it is a “generational” budget with key “investments” to stimulate the economy.

“Budget 2025 is our plan to build Canada Strong – with major infrastructure projects, millions more homes, new defence industries, and thousands of new high-quality careers all across our country,” said Prime Minister Carney. “As we build big and bold, we will build Canadian and buy Canadian. We will be our own best customer, creating new orders, more business, and new careers in our industries across the country.”

However, Dufferin–Caledon MP Kyle Seeback, who said he and his fellow Conservatives reluctantly voted against the budget, classified the deficit spending as “generational debt.”

“It was a close vote,” said MP Seeback. “I would have liked to have supported the budget because Canada’s having a difficult time with the trade war with the United States, but unfortunately, the budget really missed the mark.”

He added, “We know that Canadians don’t want an election right now, but this budget was so bad we had no choice.”

MP Seeback criticized the budget for, in his view, failing to address Canada’s rising cost of living, the ongoing housing crisis, and its record non-pandemic-year deficit spending.  

In regard to new spending, which the Liberals have called “investments” in Canada’s economy, MP Seeback pointed to a recent statement from the Parliamentary Budget Officer (PBO) Jason Jacques.

Jacques wrote in a recent report that the “PBO maintains its view that the government’s definition of capital investments is overly expansive.”

Jacques criticized Finance Canada for changing the way it reports deficit spending by separating capital from operational spending.

The PBO also suggested that there is less than a 10 per cent chance the Liberal government will be able to stay within its deficit targets.

“The budget is just an estimate of what that (deficit spending) is going to be,” said MP Seeback. “We won’t find out what the actual numbers are until we get all the estimates brought before the House (of Commons) in June.”

“I suspect that the deficit is going to be much higher than what they project in the budget of 78 billion,” he added.

MP Seeback said he’s not convinced the federal government will find the spending reductions they’re expecting and is underestimating the impact of the ongoing trade war with the U.S.

When asked what the Conservative Party would have done differently to reduce the deficit, MP Seeback said program and global spending must be cut.

“If you look at the kind of spending that goes on in certain departments, or what we spend around the world… most Canadians would be outraged,” he said. “Billions of dollars could be saved in what we spend on foreign aid.”

Secondly, he said improvements to the economy could lower the deficit. MP Seeback argues that repealing Bill C-69 would enable more mining, pipeline, and processing projects to be approved in Canada, boosting economic activity.

He said the Conservatives believe they could have lowered this year’s deficit to roughly $40 to $42 billion by getting more projects approved and cutting program spending.

Looking at the broader Canadian economy, Seeback is critical of the current unemployment rate, which sits at 6.9 per cent.

Most economists argue that an unemployment rate between 3.5 and 4.5 per cent is ideal for maintaining a healthy and expanding economy.

MP Seeback also noted that Canadians who are not actively seeking employment are not counted in official unemployment data.

To officially be counted by Statistics Canada, an unemployed person must be actively searching for a job within the last four weeks or be on a temporary layoff.

“The actual rate (of unemployment) is higher than that (6.9 per cent), because I know lots of people in the (Dufferin–Caledon) riding who send emails saying they’ve given up trying to find a job,” MP Seeback told the Citizen.

Concerning immigration, the target for permanent residents increased from 272,000 in 2015 to a peak of 485,000 in 2024. Under Prime Minister Carney, immigration is projected to reach 415,000 permanent residents by the end of 2025, but the new immigration target for 2026 has been lowered to 380,000. The Liberal Government said this is to alleviate pressure on housing and public services while stabilizing population growth.

Seeback calls the lower immigration targets “marginal improvement,” but noted that the number of temporary residents in Canada remains high. There were approximately 3 million temporary residents in 2024’s third quarter, of whom roughly 1.5 million held work permits.

“We need to reduce immigration levels, number one, to the level that we can comfortably house (people), not overwhelm our hospitals, and not overwhelm our schools,” said MP Seeback. “We’ve said that we would get rid of the temporary foreign worker program because too many Canadians are losing jobs to temporary foreign workers.”

While many corporations support the temporary foreign worker program to fill labour shortages, MP Seeback said he disagrees with this sentiment.

“British Columbia brings in hundreds and hundreds of temporary foreign iron workers; meanwhile, the iron workers union out there has people who aren’t working. That’s the perfect example of what’s happening,” he remarked.

Regarding the budget, while the Liberals view it as a strategic, investment-led plan focused on protecting national sovereignty while boosting productivity, MP Seeback and the Conservatives argue it significantly increases the national debt while failing to address Canada’s cost-of-living crisis.

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