Lethbridge’s MP is accusing the federal Liberal government of worsening the country’s fiscal position, stating its latest economic update relies too heavily on borrowing while failing to address affordability concerns.
In a statement, Conservative MP Rachael Thomas said the plan, the Liberals tabled in the House of Commons a year after being elected back into power, amounts to a “credit card budget” that will add tens of billions of dollars to the national debt.
According to Thomas, the update shows the government will add roughly $65 billion to Canada’s debt this year, a figure she said exceeds deficits recorded under former prime minister Justin Trudeau outside of the pandemic period.
She added the Liberals had previously presented Prime Minister Mark Carney as a fiscally disciplined leader capable of curbing spending.
“It turns out that was a misleading sales pitch,” she said. “Instead, the Liberals have tabled a Spring Economic Update that doubles down on the same failed formula: borrow more, spend more, promise more, and leave the consequences for someone else.”
Thomas said the now-majority government has failed to outline a clear path back to balanced budgets, echoing concerns raised by the C.D. Howe Institute, which has warned Canada risks losing its reputation for fiscal discipline.
Among the spending initiatives she criticized are a proposed high-speed rail project between Toronto and Quebec City, estimated at $90 billion, and a federal firearms buyback program projected to cost hundreds of millions. She also pointed to federal spending on outside consultants, which she said totalled $20 billion in the 2024-25 fiscal year.
Thomas further questioned spending on healthcare for rejected asylum claimants while noting ongoing shortages of family doctors across the country.
“None of this spending has made life better for Canadians. Groceries remain expensive. Housing is increasingly out of reach. Fuel costs are high. Crime is rising. Healthcare is strained,” she said. “For all the billions spent, Canadians are receiving very little in return.”
Business groups also raised concerns about the federal government’s fiscal direction, while acknowledging some targeted measures.
Dan Kelly, president of the Canadian Federation of Independent Business, said the update continues to prioritize large-scale projects while doing little to support small and medium-sized firms.
“I don’t see much that will help Canada avoid a seventh quarter in a row of losses in the net number of small businesses,” Kelly said, adding Canada is facing what he described as an “entrepreneurial drought.”
He criticized proposed large investment funds, saying similar measures in past budgets have not significantly boosted economic growth, and warned that ongoing deficits could translate into future tax increases.
“Small firms have learned the hard way that today’s deficits become tomorrow’s taxes,” he said, noting the government is projecting deficits above $50 billion for the foreseeable future without a clear plan to return to balance.
However, Kelly pointed to a reduction in Canada Pension Plan premiums as a positive measure. The rate is set to drop from 9.9 per cent to 9.5 per cent, a move he said would return roughly $3 billion to workers and employers.
He also welcomed changes to apprenticeship supports, including a new grant program and a $10,000 wage incentive for employers in the skilled trades, as well as a decision to make the employee ownership trust tax exemption permanent.
Despite those measures, Kelly said small business confidence remains low amid economic uncertainty, including concerns over tariffs and energy prices.
The federal government has maintained that its spending is necessary to support economic growth and address affordability challenges, though it has acknowledged ongoing fiscal pressures.
Thomas said Conservatives would instead focus on reducing government spending by cutting what she described as wasteful programs, consultant fees, and inefficiencies, while reviewing major projects and tightening oversight.
“Every dollar Ottawa spends should have a clear purpose, a clear benefit, and a clear result,” she said.
