Finance Committee on Feb. 5th, 2026

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

The deputy minister may want to add something on this subject, but I think it was a good idea to change how we do things in this country. There have been times when the federal budget was tabled after all the provincial budgets.

That approach certainly didn't take into account the construction season. No matter what we do here, the construction season doesn't lie. Tabling a budget in November provides predictability and much more stability for the provinces and territories because they know how much they'll be getting in transfers in advance.

As you've seen, even the IMF has praised Canada's approach, suggesting that other G7 countries could use it as a model.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

With all due respect, I have to interrupt you. There are a lot of topics I'd like to discuss. If your team has the answers, you can simply send them to the committee. I would appreciate that.

The third topic I would like to discuss with you is the amount in the budget for infrastructure. I'm confused. On page 7 of the introduction, it mentions $280 billion over five years. In chapter 1, on page 101, it says $115 billion over five years. In the table at the end of the chapter, on page 124, it says there will actually be $9 billion in new money. You have to subtract. The government says we should invest $20.1 billion in infrastructure for future generations, but subtract the $11.73 billion in previously provisioned funds, and you get $9 billion.

How much new infrastructure money is actually in your budget?

Again, if you don't have the amount handy, please don't hesitate to send us the answer in writing.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

That's an excellent question, Mr. Ste‑Marie. As always, your remarks are very relevant.

As you can imagine, the provinces and territories have asked me this question, too. We can give you the exact amount. If I remember correctly, there's over $25 billion in additional funding for infrastructure.

The differences you pointed out can be explained by the fact that some amounts are determined on a cash basis. We present the figures according to accounting practice, which is why you see that our investment plan is $280 billion. That's a significant amount, but, on a cash basis, it comes to $450 billion.

It may interest you to know that we were inspired by the German model. When a generational project of this kind was announced in Germany, they were planning to invest 500 billion euros over 12 years. If you convert that to Canadian dollars, it would be about $800 billion over 12 years. We're planning $450 billion over five years. That is generational, and that's what credit agencies and our investors are seeing. They're seeing that Canada's infrastructure plan is one of the largest, if not the largest, in the G7. That's why we want to work with the municipalities, territories and provinces.

[The Chair, Liberal, Karina Gould]

Thank you, Minister.

Thank you, Mr. Ste‑Marie.

Mr. Lefebvre, you have the floor for five minutes.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

Thank you, Madam Chair.

Minister, it's good to see you again. We go way back. At the time, I had the privilege of being a member of the National Assembly with my colleague, Mr. Leitão, for whom I also have a great deal of respect.

I would like to echo what Mr. Leitão said. He said that returning to a balanced budget is not an obsession, but an obligation.

Do you agree with your colleague on that?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

As you know, I have a lot of respect for you and Mr. Leitão because we've worked on things together in the past. You're right, we've always worked well together.

Let me tell you: The world has changed. I've served in the federal government for years. People have pointed out that I took certain stances in the past, but now the world has changed, especially in the past few months.

I'll reiterate what the IMF said about Canada. It said the global situation is unprecedented. We'd have to go back many decades to find a comparable situation. As a result, those with the necessary fiscal capacity must use it to stimulate economic growth.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

Thank you, Minister.

Later, I'll ask Quebec's former finance minister if he still stands by his statement. I imagine he does.

Minister, when the budget was tabled, you said you wanted to eliminate 40,000 public service positions. During question period, you talked about doing it through attrition. In other words, it will happen gradually as public servants retire. It's going to be hard to cut 40,000 positions through attrition alone.

Do you have a performance assessment tool to figure out how many public service positions will be eliminated?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I'll give you a bit of background and then answer your question more specifically.

We said that we need to return the size of the federal public service to a level that is more sustainable over the long term. The public service grew significantly during the pandemic. You may have seen a graph in the budget showing that. We want to better align the size of the public service with the Canadian population and other G7 countries.

It's important to understand that, yes, there will be attrition, but other measures have been put forward to make that happen in a humane and responsible manner with great consideration for the people who have served the country, because—

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

I'm sorry to cut you off. I do have several questions.

Do you have a performance assessment tool? At this point, can you tell me if there have been any results in the past seven months?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Yes, I can give the committee that data. I'm sure you've seen some articles in La Presse about notices sent to public servants. Implementing these departures will take several years.

All I want to say is that I am grateful to public servants, who are doing an amazing job.

The idea is to reduce the number of employees to a more sustainable level. We need to get back to a pre-pandemic ratio. I also think that, given modern technology, we need to modernize the Canadian government.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

According to the budget, the government wants to develop economic strength through fiscal discipline. Over the past decade, government spending has increased rapidly, with direct program expenses increasing by 8% annually. The budget says this pace is no longer sustainable. It's right there in black and white: “a pace that is no longer sustainable”.

The cost of Cúram, the computer system that manages our seniors' old age security pension, went up from $1.7 billion to $6.6 billion. They talk about fiscal discipline on the one hand, but on the other, there's the Cúram boondoggle. According to a survey, nearly 93% of public servants say that the computer system isn't working.

You talk about fiscal discipline, but these facts suggest otherwise.

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

Thank you for raising the issue of rising program expenses. On page 13 of the budget, there's a graph that illustrates how we'll reduce that 8% annual increase to a more sustainable growth rate over the years. For that reason, one of the fiscal anchors we've set for ourselves is to align the operating budget with revenues by 2028‑29. At that point, any loans will be used for capital investments.

Thank you for highlighting the fact that we're moving from 8% to a rate that's much more sustainable over the long term. That's exactly what we wanted to illustrate in the graph on page 13 of the budget.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

How can you talk about fiscal discipline if the cost of a computer system like Cúram goes from $1.7 billion to $6.6 billion? That's just one example—

[The Chair, Liberal, Karina Gould]

I'm sorry to interrupt, Mr. Lefebvre. Your time is up.

We will continue with Mr. Sawatzky for five minutes, please.

[Jake Sawatzky, Liberal, New Westminster—Burnaby—Maillardville, BC]

Thank you, Madam Chair.

Minister, it almost seems like you're a permanent member of this committee this week. It's truly a pleasure to see you again.

A lot of the investments in budget 2025, as we see in Bill C‑15, are for major infrastructure projects to drive the country's economic growth.

As you know, many workers in Canada are struggling these days. Those in manufacturing, steel, aluminum, forestry and other sectors affected by the tariffs are feeling the effects of the United States' unjustified trade measures in particular. These structural and generational investments are designed specifically to create jobs these workers can retrain for.

How is the government going to create jobs here?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

First of all, thank you for the question. Congratulations on your French. I enjoyed hearing it. Thank you for inviting me to appear before the committee. I feel very much like a permanent member of this committee.

You're right, budget 2025 is really a generational investment plan. As we've seen, the Canadian economy may be more resilient than some expected.

You talked about the tariff situation with the United States. I should note that, even now, 85% of the goods that cross the border are duty-free thanks to the free trade agreement and the exemptions. Canada is in a privileged position with a marginal tax rate of 5.4%.

That said, it's important to know that the effects of the tariffs are being felt very acutely in the lumber industry in regions like mine, Saguenay—Lac‑Saint‑Jean, in Mauricie and in Vancouver; in the steel sector in Hamilton; in the automotive sector in Windsor and Oshawa; and in the aluminum sector in Saguenay. Generally speaking, the Canadian economy is more resilient than people thought, with the exception of sectors and regions where those effects are being felt.

Madam Chair, I know you're from the Hamilton region and have done a lot for steelworkers and the steel industry. I am grateful for your contribution.

I mention that because sometimes the data point to a national trend, but the situation on the ground in a particular sector, such as the steel sector in Hamilton, is not as clear. That's why we knew we had to build the strongest economy in the G7. The Canadian economy is currently the second-fastest-growing economy in the G7, so we're in a very good position.

Still, we have a lot to do in this country. I think one thing that's going to help steelworkers in Hamilton is the buy Canada policy. It is definitely high time we give Canadian companies favourable treatment and eliminate interprovincial tariff barriers. I believe a recent IMF study noted that, although there's still work to be done, Canada has the potential to boost its economy by some $200 billion.

We've also taken structural measures through the strategic response fund to enable the Canadian economy to adapt to the new reality of export markets, automation and productivity. That's why the budget includes many measures designed to stimulate productivity and innovation. We'll start by investing here at home to grow our economy and help our workers.

With respect to the deficits that members were talking about initially, on page 2 of the budget, we see that about 75% of the actions that contributed to a deficit this year supported sovereignty and affordability. I think those two things are in line with Canadian values. That is why we will grow the Canadian economy while being there for workers in meaningful ways.

[Jake Sawatzky, Liberal, New Westminster—Burnaby—Maillardville, BC]

Thank you very much. I will just switch to English now.

Of course, these large-scale projects don't just grow the economy; they also create many long-term, skilled union jobs, providing stability for those workers who are facing disruption right now, especially in these traditional sectors that are really feeling the pain from tariffs.

In British Columbia, the softwood lumber industry is being hit quite hard. Our combination of the buy Canadian policies with all of these large-scale national projects will certainly—

[The Chair, Liberal, Karina Gould]

Thank you, Mr. Sawatsky.

We're going to have to end it there.

Mr. Ste‑Marie, you have the floor for two and a half minutes.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

Thank you very much, Madam Chair.

I have some technical questions for the minister and deputy minister about division 9, which deals with consumer-driven banking services, as well as harmonization with the Autorité des marchés financiers, the AMF, and provincial entities. However, if you don't have the answers handy, feel free to send them to the committee in writing.

If the single framework were put in place and an agreement were reached with the provincial entity and the Bank of Canada, what would the relationship be between those two institutions?

For example, would the AMF become an extension of the Bank of Canada to oversee the framework, or would it retain its autonomy to act within its jurisdiction?

In other words, would the AMF report to the Bank of Canada or to Quebec's ministry of finance for everything related to the open banking system?

[François-Philippe Champagne, Liberal, Saint-Maurice—Champlain, QC]

I'll let the Deputy Minister of Finance, a former member of the Bank of Canada, address those two questions.

[Nick Leswick, Deputy Minister, Department of Finance]

If I understand the question correctly, the legislative framework under the Consumer-Driven Banking Act will allow the provinces an opt-in allowance. They can opt in to the legislative and regulatory provisions that the federal government is deploying. In that context, the minister, working with the Bank of Canada, as the overseer of the framework, can designate a provincial regulator or supervisor to oversee the deployment.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

Okay.

Here's my question. Let's suppose that the AMF were designated in Quebec. Would the AMF be accountable to the Bank of Canada or to Quebec's ministry of finance for that part?

[Nick Leswick]

I'll have to follow up. My instinct is that it would put it through to the Bank of Canada, but let's make sure that we get a correct answer there.

[Gabriel Ste-Marie, Bloc, Joliette—Manawan, QC]

I have one last question about this.

Last December, in another committee, the Department of Finance noted that provincial authorities, such as the AMF, can add standards for certain things, such as information exchange and privacy. However, these additional rules would create an uneven playing field.

I would like you to comment on that. You can also send comments in writing to the committee.

[The Chair, Liberal, Karina Gould]

Thank you very much.

We will continue with Ms. Cobena for five minutes, please.