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Fraser Institute

Cost of Ottawa’s gun ban fiasco may reach $6 billion

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From the Fraser Institute

By Gary Mauser

According to the government, it has already spent $67.2 million, which includes compensation for 60 federal employees working on the “buyback,” which still doesn’t exist.

Four years ago, the Trudeau government banned “1,500 types” of “assault-style firearms.” It’s time to ask if public safety has improved as promised.

This ban instantly made it a crime for federally-licensed firearms owners to buy, sell, transport, import, export or use hundreds of thousands formerly legal rifles and shotguns. According to the government, the ban targets “assault-style weapons,” which are actually classic semi-automatic rifles and shotguns that have been popular with hunters and sport shooters for more than 100 years. When announcing the ban, the prime minister said the government would confiscate the banned firearms and their legal owners would be “grandfathered” or receive “fair compensation.” That hasn’t happened.

As of October 2024, the government has revealed no plans about how it will collect the newly-banned firearms nor has it made any provisions for compensation in any federal budget since the announcement in 2020. Originally, the government enacted a two-year amnesty period to allow compliance with the ban. This amnesty expired in April 2022 and has been twice extended, first to Oct. 30, 2023, then to Oct. 30, 2025.

Clearly, the ban—which the government calls a “buyback”—has been a gong show from the beginning. Since Trudeau’s announcement four years ago, virtually none of the banned firearms have been  surrendered. The Ontario government refuses to divert police resources to cooperate with this federal “buyback” scheme. The RCMP’s labour union has said it’s a “misdirected effort when it comes to public safety.” The Canadian Sporting Arms & Ammunition Association, which represents firearms retailers, said it will have “zero involvement” in helping confiscate these firearms. Even Canada Post wants nothing to do with Trudeau’s “buyback” plan. And again, the government has revealed no plan for compensation—fair or otherwise.

And yet, according to the government, it has already spent $67.2 million, which includes compensation for 60 federal employees working on the “buyback,” which still doesn’t exist.

It remains unclear just how many firearms the 2020 ban includes. The Parliamentary Budget Officer  estimates range between 150,000 to more than 500,000, with an estimated total value between $47 million and $756 million. These costs only include the value of the confiscated firearms and exclude the administrative costs to collect them and the costs of destroying the collected firearms. The total cost of this ban to taxpayers will be more than $4 billion and possibly more than $6 billion.

Nevertheless, while the ban of remains a confusing mess, after four years we should be able to answer one key question. Has the ban made Canadians safer?

According to Statistics Canada, firearm-related violent crime swelled by 10 per cent from 2020 to 2022 (the latest year of comparable data), from 12,614 incidents to 13,937 incidents. And in “2022, the rate of firearm-related violent crime was 36.7 incidents per 100,000 population, an 8.9% increase from 2021 (33.7 incidents per 100,000 population). This is the highest rate recorded since comparable data were first collected in 2009.”

Nor have firearm homicides decreased since 2020. Perhaps this is because lawfully-held firearms are not the problem. According to StatsCan, “the firearms used in homicides were rarely legal firearms used by their legal owners.” However, crimes committed by organized crime have increased by more than 170 per cent since 2016 (from 4,810 to 13,056 crimes).

Meanwhile, the banned firearms remain locked in the safes of their legal owners who have been vetted by the RCMP and are monitored nightly for any infractions that might endanger public safety.

Indeed, hunters and sport shooters are among the most law-abiding people in Canada. Many Canadian families and Indigenous peoples depend on hunting to provide food for the family dinner table through legal harvesting, with the added benefit of getting out in the wilderness and spending time with family and friends. In 2015, hunting and firearm businesses alone contributed more than $5.9 billion to Canada’s economy and supported more than 45,000 jobs. Hunters are the largest contributors to conservation efforts, contributing hundreds of millions of dollars to secure conservation lands and manage wildlife. The number of licensed firearms owners has increased 17 per cent since 2015 (from 2.026 million to 2.365 million) in 2023.

If policymakers in Ottawa and across the country want to reduce crime and increase public safety, they should enact policies that actually target criminals and use our scarce tax dollars wisely to achieve these goals.

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Business

New federal government plans to run larger deficits and borrow more money than predecessor’s plan

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Fr0m the Fraser Institute

By Jake Fuss and Grady Munro

The only difference, despite all the rhetoric regarding change and Prime Minister Carney’s criticism of the Trudeau government’s fiscal approach, is that the Carney government plans to run larger deficits and borrow more money.

As part of his successful election campaign, Prime Minister Mark Carney promised a “very different approach” to fiscal policy than that of the Trudeau government. But when you peel back the rhetoric and look at his plan for deficits and debt, things begin to look eerily similar—if not worse.

The Carney government’s “responsible” new approach is centered around the idea of “spending less” in order to “invest more.” The government plans to separate spending into two budgets: the operating budget (which appears to include bureaucrat salaries, cash transfers and benefits) and the capital budget (which includes any spending that “builds an asset”). The government plans to balance the operating budget by 2028/29 (meaning operating spending will be fully covered by revenues) while funding the capital budget through borrowing.

Aside from the fact that this clearly complicates federal finances, this “very different” approach to spending actually represents more of the same by continuing to pursue endless borrowing and a larger role for the government in the economy.

The chart below compares projected annual federal budget balances for the next four years, from both the 2024 Fall Economic Statement (FES)—the Trudeau government’s last fiscal update—and the 2025 Liberal Party platform. Importantly, deficits from the 2025 platform show the overall budget balance including both operating and capital spending.

Let’s start with the similarities.

In its final fiscal update last fall, the Trudeau government planned to borrow tens of billions of dollars each year to fund annual spending, with no end in sight. Based on its election platform, the Carney government also plans to run multi-billion-dollar deficits each year with no plan to balance the overall budget. The only difference, despite all the rhetoric regarding change and Prime Minister Carney’s criticism of the Trudeau government’s fiscal approach, is that the Carney government plans to run larger deficits and borrow more money.

In the current fiscal year (2025/26) the Trudeau government had planned to run a $42.2 billion deficit. The Carney government now plans to increase that deficit to $62.3 billion. Trudeau’s most recent fiscal plan forecasted annual deficits from 2025/26 to 2028/29 representing a cumulative $131.4 billion in federal government borrowing. Over that same period, the Carney government now plans to borrow a cumulative $224.8 billion.

The Carney government’s fiscal plan does include a number of tax changes that are expected to lower revenues in years to come—including (but not limited to) a personal income tax cut, the elimination of the GST for some first-time homebuyers, and the cancelling of the planned capital gains tax hike. But even if you exclude these factors from the overall budget, the Carney government still plans to borrow $52.9 billion more than the Trudeau government had planned over the next four years.

By continuing (if not worsening) this same approach of endless borrowing and rising debt, the Carney government will impose real costs on Canadians. Indeed, 16-year-olds can already expect to pay an additional $29,663 in personal income taxes over their lifetime as a result of debt accumulation under the previous federal government, before accounting for the promised increases.

One of the key promises made by Prime Minister Carney is that his government will take a different approach to fiscal policy than his predecessor. While we won’t know for certain until the new government releases its first budget, it appears this approach will continue the same costly habits of endless borrowing and rising debt.

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Grady Munro

Policy Analyst, Fraser Institute

 

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Automotive

New federal government should pull the plug on Canada’s EV revolution

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During his victory speech Monday night, Prime Minister Mark Carney repeated one of his favourite campaign slogans and vowed to make Canada a “clean energy superpower.” So, Canadians can expect Ottawa to “invest” more taxpayer money in “clean energy” projects including electric vehicles (EVs), the revolutionary transportation technology that’s been ready to replace internal combustion since 1901 yet still requires government subsidies.

It’s a good time for a little historical review. In 2012 south of the border, the Obama administration poured massive subsidies into companies peddling green tech, only to see a vast swath go belly up including Solyndra, would-be maker of advanced solar panels, which failed so spectacularly CNN called the company the “poster child for well-meaning government policy gone bad.”

One might think that such a spectacular failure might have served as a cautionary tale for today’s politicians. But one would be wrong. Even as the EV transition slammed into stiff headwinds, the Trudeau government and Ontario’s Ford government poured $5 billion in subsidies into Honda to build an EV battery plant and manufacture EVs in Ontario. That “investment” came on top of a long list of other “investments” including $15 billion for Stellantis and LG Energy Solution; $13 billion for Volkswagen (or $16.3 billion, per the Parliamentary Budget Officer), a combined $4.24 billion (federal/Quebec split) to Northvolt, a Swedish battery maker, and a combined $644 million (federal/Quebec split) to Ford Motor Company to build a cathode manufacturing plant in Quebec.

How’s all that working out? Not great.

“Projects announced for Canada’s EV supply chain are in various states of operation, and many remain years away from production,” notes automotive/natural resource reporter Gabriel Friedman, writing in the Financial Post. “Of the four multibillion-dollar battery cell manufacturing plants announced for Canada, only one—a joint venture known as NextStar Energy Inc. between South Korea’s LG Energy Solution Ltd. and European automaker Stellantis NV—progressed into even the construction phase.”

In 2023, Volkswagen said it would invest $7 billion by 2030 to build a battery cell manufacturing complex in St. Thomas, Ontario. However, Friedman notes “construction of the VW plant is not scheduled to begin until this spring [2025] and initial cell production will not begin for years.” Or ever, if Donald Trump’s pledge to end U.S. government support for a broad EV transition comes to pass.

In the meantime, other elements of Canada’s “clean tech” future are also in doubt. In December 2024, Saint-Jérome, Que.-based Lion Electric Co., which had received $100 million in provincial and government support to assemble batteries in Canada for electric school buses and trucks, said it would file for bankruptcy in the United States and creditor protection in Canada. And Ford Motor Company last summer scrapped its planned EV assembly plant in Oakville, Ontario—after $640 million in federal and provincial support.

And of course, there’s Canada’s own poster-child-of-clean-tech-subsidy failure, Northvolt. According to the CBC, the Swedish battery manufacturer, with plans to build a $7 billion factory in Quebec, has declared bankruptcy in Sweden, though Northvolt claims that its North American operations are “solvent.” That’s cold comfort to some Quebec policymakers: “We’re going to be losing hundreds of millions of dollars in a bet that our government in Quebec made on a poorly negotiated investment,” said Parti Québécois MNA Pascal Paradis.

Elections often bring about change. If the Carney government wants to change course and avoid more clean-tech calamities, it should pull the plug on the EV revolution and avoid any more electro-boondoggles.

Kenneth P. Green

Senior Fellow, Fraser Institute
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