Trudeau and Ford should attach personal fortunes to EV corporate welfare

Last week, with their latest tranche of corporate welfare for the electric vehicle (EV) sector, the Trudeau and Ford governments announced a $5.0 billion subsidy for Honda to help build an EV battery plant and ultimately manufacture EVs in Ontario. Here’s a challenge: if politicians in both governments truly believe these measures are in the public interest, they should tie their personal fortunes with the outcomes of these subsidies (a.k.a. corporate welfare).

One of the major challenges with corporate welfare is the horrendous economic incentives. The politicians and bureaucrats who distribute corporate welfare have no vested financial interest in the outcome of the program. Whether these programs are spectacularly successful (or more likely spectacular failures), the politicians and bureaucrats experience no direct financial gain or loss. Simply put, they’re investing taxpayer money, not their own.

Put differently, the discipline imposed on investors in private markets, such as the risk of losing money or even going out of business, is wholly absent in the government sector. Indeed, the history of corporate welfare in Canada, at both the federal and provincial levels, is rife with abject failures due in large measure to the absence of this investing discipline.

In the last 12 months in Ontario, automakers have been major beneficiaries of corporate welfare. The $5.0 billion for Honda is on top of $13.2 billion to Volkswagen and $15.0 billion to Stellantis. That equates to roughly $979 per taxpayer nationally for federal subsidies and an additional $1,372 for Ontario taxpayers. And these figures do not include the debt interest costs that will be incurred as both governments are borrowing money to finance the subsidies.

And there’s legitimate reason to be skeptical already of the potential success of these largescale industrial interventions by the federal (Liberal) and Ontario (Conservative) governments. EV sales in both Canada and the United States have not grown as expected by governments despite purchase subsidies. Disappointing EV sales have led several auto manufacturers including Toyota and Ford to scale-back their EV production plans.

There are also real concerns about the practical ability of EV manufacturers to secure required materials. Consider the minerals needed for EV batteries. According to a recent study, 388 new mines—including 50 lithium mines, 60 nickel mines and 17 cobalt mines—would be required by 2030 to meet EV adoption commitments by various governments. For perspective, there were a total of 340 metal mines operating across Canada and the U.S. in 2021. The massive task of finding, constructing and developing this level of new mines seems impractical and unattainable, meaning that EV plants being built now will struggle to secure needed inputs. Indeed, depending on the type of mine, it takes anywhere from six to 18 years to develop.

Which brings us back to the Trudeau and Ford governments. Given the economic incentive problems and practical challenges to a large-scale transition to EVs, would members of the Trudeau and Ford governments—including the prime minister and premier—want to attach a portion of their personal pensions to the success of these corporate welfare programs?

More specifically, assume an arrangement whereby those politicians would share the benefits of the program’s success but also share any losses through the value of their pensions. If the programs work as marketed, the politicians would enjoy higher valued pensions. But if the programs disappoint or even fail, their pensions would be reduced or even cancelled. Would these politicians still support billions in corporate handouts if their personal financial wellbeing was tied to the outcomes?

As the funding of private companies to develop the EV sector in Ontario continues with the support of taxpayer subsidies, Ontarians and all Canadians should consider the misalignment of economic incentives underpinning these subsidies and the practical challenges to the success of this industrial intervention.

Authors:

Jason Clemens

Executive Vice President, Fraser Institute

Tegan Hill

Associate Director, Alberta Policy, Fraser Institute

Related Topics:#DougFord #EVCorporateWelfare #EVSubsidies #FraserInstitute #HondaEVBatteryPlant #JasonClemens #JustinTrudeau #TeganHill

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Storm clouds of uncertainty as BC courts deal another blow to industry and investment

Published on December 9, 2025

Todayville

From the Fraser Institute

By Tegan Hill and Jason Clemens

Recent court decision adds to growing uncertainty in B.C.

A recent decision by the B.C. Court of Appeal further clouds private property rights and undermines investment in the province. Specifically, the court determined British Columbia’s mineral claims system did not follow the province’s Declaration on the Rights of Indigenous Peoples Act (DRIPA), which incorporated the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) into law.

DRIPA (2019) requires the B.C. provincial government to “take all measures necessary to ensure the laws of British Columbia are consistent with the Declaration,” meaning that all legislation in B.C. must conform to the principles outlined in the UNDRIP, which states that “Indigenous peoples have the right to the lands, territories and resources which they have traditionally owned, occupied or otherwise used or acquired.” The court’s ruling that the provincial government is not abiding by its own legislation (DRIPA) is the latest hit for the province in terms of ongoing uncertainty regarding property rights across the province, which will impose massive economic costs on all British Columbians until it’s resolved.

Consider the Cowichan First Nations legal case. The B.C. Supreme Court recently granted Aboriginal title to over 800 acres of land in Richmond valued at $2.5 billion, and where such aboriginal title is determined to exist, the court ruled that it is “prior and senior right” to other property interests. Put simply, the case puts private property at risk in BC.

The Eby government is appealing the case, yet it’s simultaneously negotiating bilateral agreements that similarly give First Nations priority rights over land swaths in B.C.

Consider Haida Gwaii, an archipelago on Canada’s west coast where around 5,000 people live—half of which are non-Haida. In April 2024, the Eby government granted Haida Aboriginal title over the land as part of a bilateral agreement. And while the agreement says private property must be honoured, private property rights are incompatible with communal Aboriginal title and it’s unclear how this conflict will be resolved.

Moreover, the Eby government attempted to pass legislation that effectively gives First Nations veto power over public land use in B.C. in 2024. While the legislation was rescinded after significant public backlash, the Eby’s government’s continued bilateral negotiations and proposed changes to other laws indicate it’s supportive of the general move towards Aboriginal title over significant parts of the province.

UNDRIP was adopted by the United Nations in 2007 and the B.C. Legislature adopted DRIPA in 2019. DRIPA requires that the government must secure “free, prior and informed consent” before approving projects on claimed land. Premier Eby is directly tied to DRIPA since he was the attorney general and actually drafted the interpretation memo.

The recent case centres around mineral exploration. Two First Nations groups—the Gitxaala Nation and the Ehattesaht First Nation—claimed the duty to consult was not adequately met and that granting mineral claims in their land “harms their cultural, spiritual, economic, and governance rights over their traditional territories,” which is inconsistent with DRIPA.

According to a 2024 survey of mining executives, more uncertainty is the last thing B.C. needs. Indeed, 76 per cent of respondents for B.C. said uncertainty around protected land and disputed land claims deters investment compared to only 29 per cent and 44 per cent (respectively) for Saskatchewan.

This series of developments have and will continue to fuel uncertainty in B.C. Who would move to or invest in B.C. when their private property, business, and investment is potentially at risk?

It’s no wonder British Columbians are leaving the province in droves. According to the B.C. Business Council, nearly 70,000 residents left B.C. for other parts of Canada last year. Similarly, business investment (inflation-adjusted) fell by nearly 5 per cent last year, exports and housing starts were down, and living standards in the province (as measured by per-person GDP) contracted in both 2023 and 2024.

B.C.’s recent developments will only worsen uncertainty in the province, deterring investment and leading to stagnant or even declining living standards for British Columbians. The Eby government should do its part to reaffirm private property rights, rather than continue fuelling uncertainty.

Tegan Hill

Director, Alberta Policy, Fraser Institute

Jason Clemens

Executive Vice President, Fraser Institute

Economy

Affordable housing out of reach everywhere in Canada

Published on December 8, 2025

Todayville

From the Fraser Institute

By Steven Globerman, Joel Emes and Austin Thompson

According to our new study, in 2023 (the latest year of comparable data), typical homes on the market were unaffordable for families earning the local median income in every major Canadian city

The dream of homeownership is alive, but not well. Nearly nine in ten young Canadians (aged 18-29) aspire to own a home—but share a similar worry about the current state of housing in Canada.

Of course, those worries are justified. According to our new study, in 2023 (the latest year of comparable data), typical homes on the market were unaffordable for families earning the local median income in every major Canadian city. It’s not just Vancouver and Toronto—housing affordability has eroded nationwide.

Aspiring homeowners face two distinct challenges—saving enough for a downpayment and keeping up with mortgage payments. Both have become harder in recent years.

For example, in 2014, across 36 of Canada’s largest cities, a 20 per cent downpayment for a typical home—detached house, townhouse, condo—cost the equivalent of 14.1 months (on average) of after-tax income for families earning the median income. By 2023, that figure had grown to 22.0 months—a 56 per cent increase. During the same period for those same families, a mortgage payment for a typical home increased (as a share of after-tax incomes) from 29.9 per cent to 56.6 per cent.

No major city has been spared. Between 2014 and 2023, the price of a typical home rose faster than the growth of median after-tax family income in 32 out of 36 of Canada’s largest cities. And in all 36 cities, the monthly mortgage payment on a typical home grew (again, as a share of median after-tax family income), reflecting rising house prices and higher mortgage rates.

While the housing affordability crisis is national in scope, the challenge differs between cities.

In 2023, a median-income-earning family in Fredericton, the most affordable large city for homeownership in Canada, had save the equivalent of 10.6 months of after-tax income ($56,240) for a 20 per cent downpayment on a typical home—and the monthly mortgage payment ($1,445) required 27.2 per cent of that family’s after-tax income. Meanwhile, a median-income-earning family in Vancouver, Canada’s least affordable city, had to spend the equivalent of 43.7 months of after-tax income ($235,520) for a 20 per cent downpayment on a typical home with a monthly mortgage ($6,052) that required 112.3 per cent of its after-tax income—a financial impossibility unless the family could rely on support from family or friends.

The financial barriers to homeownership are clearly greater in Vancouver. But, crucially, neither city is truly “affordable.” In Fredericton and Vancouver, as in every other major Canadian city, buying a typical home with the median income produces a debt burden beyond what’s advisable. Recent house price declines in cities such as Vancouver and Toronto have provided some relief, but homeownership remains far beyond the reach of many families—and a sharp slowdown in homebuilding threatens to limit further gains in affordability.

For families priced out of homeownership, renting doesn’t offer much relief, as rent affordability has also declined in nearly every city. In 2014, rental rates for the median-priced rental unit required 19.8 per cent of median after-tax family income, on average across major cities. By 2023, that figure had risen to 23.5 per cent. And in the least affordable cities for renters, Toronto and Vancouver, a median-priced rental required more than 30 per cent of median after-tax family income. That’s a heavy burden for Canada’s renters who typically earn less than homeowners. It’s also an added financial barrier to homeownership— many Canadian families rent for years before buying their first home, and higher rents make it harder to save for a downpayment.

In light of these realities, Canadians should ask—why have house prices and rental rates outpaced income growth?

Poor public policy has played a key role. Local regulations, lengthy municipal approval processes, and costly taxes and fees all combine to hinder housing development. And the federal government allowed a historic surge in immigration that greatly outpaced new home construction. It’s simple supply and demand—when more people chase a limited (and restricted) supply of homes, prices rise. Meanwhile, after-tax incomes aren’t keeping pace, as government policies that discourage investment and economic growth also discourage wage growth.

Canadians still want to own homes, but a decade of deteriorating affordability has made that a distant prospect for many families. Reversing the trend will require accelerated homebuilding, better-paced immigration and policies that grow wages while limiting tax bills for Canadians—changes governments routinely promise but rarely deliver.