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Trudeau reversed Chrétien’s legacy and rapidly expanded federal bureaucracy

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From the Fraser Institute

By Ben Eisen and Jake Fuss

Over the next weeks and months, there will be much discussion about Justin Trudeau’s legacy as prime minister. To provide some context, it’s worth comparing Trudeau’s fiscal record with that of another long-serving Liberal prime minister—Jean Chrétien.

In the early 1990s Canada’s federal finances were in shambles. Thanks to years of large budget deficits (and high interest rates), debt interest payments were consuming one-third of all federal revenue and the country stood at the brink of a full-blown fiscal crisis. Paul Martin, Chrétien’s finance minister, recognized the gravity of the threat and famously promised to eliminate the deficit “come hell or high water.” And that’s exactly what the Chrétien government did, thanks primarily to reductions in federal spending.

How’d they do it?

The government launched a program review, which examined all dimensions of spending in search of savings. The review led to a substantial reduction in federal government employment, which shrunk by nearly 15 per cent. While there were many components to the federal reforms of the 1990s, this reduction in the size of the federal bureaucracy clearly helped Chrétien and Martin eliminate the federal deficit.

Fast-forward to the present day and Justin Trudeau, who does not share his Liberal predecessors’ commitment to balanced budgets. Federal government employment has increased rapidly in recent years, with the Trudeau government adding more bureaucrats (in absolute and percentage terms) than were reduced during the Chrétien/Martin reform era.

Specifically, from 2015/16 to 2022/23, federal government employment (as measured in fulltime equivalents) increased by 26.1 per cent. By comparison, the Canadian population increased by 9.1 per cent over the same period.

Just as the reduction in federal employment contributed to the deficit reduction in the 1990s, the growth in federal employment has helped fuel the Trudeau government’s unending string of budget deficits since 2015/16. Incidentally, if during its nine years in power the Trudeau government had simply held the rate of growth in federal employment to the rate of population growth, federal spending would be $7.5 billion lower than it is today.

According to the Trudeau government’s latest projections, the federal deficit will reach an eye-popping $48.3 billion this fiscal year. And thanks to years of record-high spending under Trudeau, total federal debt will eclipse $2.15 trillion. Consequently, the federal government will spend $53.7 billion this year on debt interest payments—or $1,301 per Canadian.

Canadian history is clear—it’s difficult to predict the policy orientation of any premier or prime minister based on their political stripe. Prime Ministers Chrétien and Trudeau prove this point. Chrétien reduced federal employment with an eye on eliminating the federal deficit. Trudeau reversed this legacy by rapidly growing the federal bureaucracy. This is one important reason for the divergent fiscal outcomes between the two governments.

Under Prime Minister Chrétien, Canadians saw a string of balanced budgets. Under Prime Minister Trudeau, an unending series of deficits and massive debt accumulation, which Canadians must pay for today and for many years to come.

Ben Eisen

Senior Fellow, Fraser Institute

Jake Fuss

Director, Fiscal Studies, Fraser Institute

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Carney Liberals quietly award Pfizer, Moderna nearly $400 million for new COVID shot contracts

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From LifeSiteNews

By Clare Marie Merkowsky

Carney’s Liberal government signed nearly $400 million in contracts with Pfizer and Moderna for COVID shots, despite halted booster programs and ongoing delays in compensating Canadians for jab injuries.

Prime Minister Mark Carney has awarded Pfizer and Moderna nearly $400 million in new COVID shot contracts.

On June 30th, the Liberal government quietly signed nearly $400 million contracts with vaccine companies Pfizer and Moderna for COVID jabs, despite thousands of Canadians waiting to receive compensation for COVID shot injuries.

The contracts, published on the Government of Canada website, run from June 30, 2025, until March 31, 2026. Under the contracts, taxpayers must pay $199,907,418.00 to both companies for their COVID shots.

Notably, there have been no press releases regarding the contracts on the Government of Canada website nor from Carney’s official office.

Additionally, the contracts were signed after most Canadians provinces halted their COVID booster shot programs. At the same time, many Canadians are still waiting to receive compensation from COVID shot injuries.

Canada’s Vaccine Injury Support Program (VISP) was launched in December 2020 after the Canadian government gave vaccine makers a shield from liability regarding COVID-19 jab-related injuries.

There has been a total of 3,317 claims received, of which only 234 have received payments. In December, the Canadian Department of Health warned that COVID shot injury payouts will exceed the $75 million budget.

The December memo is the last public update that Canadians have received regarding the cost of the program. However, private investigations have revealed that much of the funding is going in the pockets of administrators, not injured Canadians.

A July report by Global News discovered that Oxaro Inc., the consulting company overseeing the VISP, has received $50.6 million. Of that fund, $33.7 million has been spent on administrative costs, compared to only $16.9 million going to vaccine injured Canadians.

The PHAC’s downplaying of jab injuries is of little surprise to Canadians, as a 2023 secret memo revealed that the federal government purposefully hid adverse effect so as not to alarm Canadians.

The secret memo from former Prime Minister Justin Trudeau’s Privy Council Office noted that COVID jab injuries and even deaths “have the potential to shake public confidence.”

“Adverse effects following immunization, news reports and the government’s response to them have the potential to shake public confidence in the COVID-19 vaccination rollout,” read a part of the memo titled “Testing Behaviourally Informed Messaging in Response to Severe Adverse Events Following Immunization.”

Instead of alerting the public, the secret memo suggested developing “winning communication strategies” to ensure the public did not lose confidence in the experimental injections.

Since the start of the COVID crisis, official data shows that the virus has been listed as the cause of death for less than 20 children in Canada under age 15. This is out of six million children in the age group.

The COVID jabs approved in Canada have also been associated with severe side effects, such as blood clots, rashes, miscarriages, and even heart attacks in young, healthy men.

Additionally, a recent study done by researchers with Canada-based Correlation Research in the Public Interest showed that 17 countries have found a “definite causal link” between peaks in all-cause mortality and the fast rollouts of the COVID shots, as well as boosters.

Interestingly, while the Department of Health has spent $16 million on injury payouts, the Liberal government spent $54 million COVID propaganda promoting the shot to young Canadians.

The Public Health Agency of Canada especially targeted young Canadians ages 18-24 because they “may play down the seriousness of the situation.”

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Carney government should apply lessons from 1990s in spending review

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From the Fraser Institute

By Jake Fuss and Grady Munro

For the summer leading up to the 2025 fall budget, the Carney government has launched a federal spending review aimed at finding savings that will help pay for recent major policy announcements. While this appears to be a step in the right direction, lessons from the past suggest the government must be more ambitious in its review to overcome the fiscal challenges facing Canada.

In two letters sent to federal cabinet ministers, Finance Minister François-Philippe Champagne outlined plans for a “Comprehensive Expenditure Review” that will see ministers evaluate spending programs in each of their portfolios based on the following: whether they are “meeting their objectives” are “core to the federal mandate” and “complement vs. duplicate what is offered elsewhere by the federal government or by other levels of government.” Ultimately, as a result of this review, ministers are expected to find savings of 7.5 per cent in 2026/27, rising to 10 per cent the following year, and reaching 15 per cent by 2028/29.

This news comes after the federal government has recently made several major policy announcements that will significantly impact the bottom line. Most notably, the government added an additional $9.3 billion to the defence budget for this fiscal year, and committed to more than double the annual defence budget by 2035. Without any policies to offset the fiscal impact of this higher defence spending (along with other recent changes), this year’s budget deficit (which the Liberal’s election platform initially pegged at $62.3 billion) will likely surpass $70.0 billion, and potentially may reach as high as $92.2 billion.

A spending review is long overdue. Recent research suggests that each year the federal government spends billions towards programs that are inefficient and/or ineffective, and which should be eliminated to find savings. Moreover, past governments (both federal and provincial) have proven that fiscal adjustments based on spending reviews can be very successful—just look at the Chrétien government’s 1995 Program Review.

In its 1995 budget, the federal Chrétien government launched a comprehensive review of all federal spending that—along with several minor tax increases—ultimately balanced the federal budget in two years and helped Canada avert a fiscal crisis. Two aspects of this review were critical to its success: it reviewed all federal spending initiatives with no exceptions, and it was based on clear criteria that not only tested whether spending was efficient, but which also reassessed the federal government’s role in delivering programs and services to Canadians. Unfortunately, the Carney government’s review is missing these two critical aspects.

The Carney government already plans to exclude large swathes of the budget from its spending review. While it might be reasonable for the government to exclude defence spending given our recent commitments (though that doesn’t appear to be the plan), the Carney government has instead chosen to exclude all transfers to individuals (such as seniors’ benefits) and provinces (such as health-care spending) from any spending cuts. Based on the last official spending estimates for this year, these two areas alone represent a combined $254.6 billion—or more than half of total spending after excluding debt charges—that won’t be reviewed.

This is a major weakness in the government’s plan. Not only does this limit the dollar value of savings available, it also means a significant portion of the government’s budget is missing out on a reassessment that could lead to more effective delivery of services for Canadians.

For example, as part of the 1995 program review, the Chrétien government overhauled how it delivered welfare transfers to provincial governments. Specifically, the federal government replaced two previous programs with a new Canada Health and Social Transfer (CHST) that addressed some major flaws with how the government delivered welfare assistance. While the transition to the CHST did include a $4.6 billion reduction in spending on government transfers, the new structure gave the federal government better control over spending growth in the future and allowed provincial governments more flexibility to tailor social assistance programs to local needs and preferences.

In addition to considering all areas of spending, the Carney government’s spending review also needs to be more ambitious in its criteria. While the current criteria are an important start—for example, it’s critical the government identifies and eliminates spending programs that aren’t achieving their stated objectives or which are simply duplicating another program—the Carney government should take it one step further and explicitly reflect on the role of the federal government itself.

Among other criteria that focused on efficiency and affordability of programs, the 1995 program review also evaluated every spending program based on whether government intervention was even necessary, and whether or not the federal government specifically should be involved. As such, not only did the program review eliminate costly inefficiencies, it also included the privatization of government-owned entities such as Petro-Canada and Canadian National Railway—which generated considerable economic benefits for Canadians.

Today, the federal government devotes considerable amounts of spending each year towards areas that are outside of its jurisdiction and/or which government shouldn’t be involved in the first place—national pharmacare, national dental care, and national daycare all being prime examples. Ignoring the fact that many of these areas (including the three examples) are already excluded from the Carney government’s spending review, the government’s criteria makes no explicit effort to test whether a program is targeting an area that’s outside of the federal purview.

For instance, while the government will test whether or not a spending program fits within the federal mandate, that mandate will not actually ensure the government stays within its own jurisdictional lane. Instead, the mandate simply lays out the key priorities the Carney government intends to focus on—including vague goals including, “Bringing down costs for Canadians and helping them to get ahead” which could be used to justify considerable federal overreach. Similarly, the government’s other criterion to not duplicate programs offered by other levels of government provides little meaningful restriction on government spending that is outside of its jurisdiction so long as that spending can be viewed as “complementing” provincial efforts. In other words, this spending review is unlikely to meaningfully check the costly growth in the size of government that Canada has experienced over the last decade.

Simply put, the Carney government’s spending review, while a step in the right direction, is missing key elements that will limit its effectiveness. Applying key lessons from the Chrétien government’s spending review is crucial for success today.

 

Jake Fuss

Director, Fiscal Studies, Fraser Institute

Grady Munro

Policy Analyst, Fraser Institute
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