Mark Carney’s Climate Competitiveness Strategy, as outlined in the 2025 federal budget, shows that his government’s priority is corporate handouts to the oil and gas sector, not support for workers and communities feeling the impacts of the climate crisis.
As climate-fuelled heat waves, wildfires and extreme weather intensify across the country, Canada’s progress on reducing greenhouse gas emissions has stalled. It is disappointing that Carney’s budget includes no new spending to put Canada back on track to meet its climate targets and hands significant wins to the fossil fuel industry.
Cuts for people and the planet
The budget contains nothing to help people make greener choices. It offers no new funding for home energy efficiency retrofits, winds down the Canada Greener Homes Grant, and does not reinstate an electric vehicle rebate program. It also cuts dedicated funding for public transit at a time when municipalities and transit agencies are facing deficits and transit riders are seeing service reductions and fare increases.
There is nothing new for nature protection or climate adaptation programs and abandons the commitment to plant 2 billion trees.
The Canada Water Agency and the Impact Assessment Agency, responsible for determining the environmental impacts of new projects, also have their funding reduced.
Workers are completely missing from the climate plan. There are no references to sustainable jobs programs or a just transition for workers in the document.
Signs of progress
CUPE welcomes the creation of a Youth Climate Corps. It will offer youth skills training and job placements to respond to climate emergencies, support recovery, and strengthen resilience in communities. However, the $40 million investment over 2 years is far too little to create a meaningful number of jobs and requires further investment to move beyond a pilot project.
Moving ahead with the long-awaited Clean Electricity Investment Tax Credit, available to public utilities and crown corporations, is a good step. However, the government has missed a huge opportunity by not committing to a publicly owned east-west electricity grid powered by renewable energy – the kind of nation-building project that could increase Canada’s energy sovereignty and drive climate progress that CUPE has been calling for.
It is good to see a commitment to strengthen industrial carbon pricing, a key climate policy, but the budget provides few details, and it remains to be seen if the new rules will be strong enough to drive down emissions from the oil and gas sector.
Big wins for the fossil fuel industry
The real winner of Budget 2025 and the Climate Competitiveness Strategy is not the climate but the fossil fuel industry and its lobbyists. While climate measures were cut, corporate handouts to the oil and gas sector increased. The budget includes tax breaks for liquified natural gas and an expansion of the Carbon Capture Utilization and Storage Investment Tax Credit.
The budget signals that the government is walking away from the oil and gas emissions cap, something that the oil patch has lobbied hard against. It also announces plans to water down anti-greenwashing rules intended to prevent false or misleading statements from corporations about their climate plans and the environmental impact of their products.
Carney’s climate strategy is itself an exercise in greenwashing. The plan makes no mention of meeting Canada’s climate targets and does not aim to make real reductions in the total amount of carbon pollution pumped into the atmosphere. Its focus is instead on reducing “carbon intensity” – in other words how much carbon pollution is created by the production of a barrel of oil. This is a potentially harmful distraction as fossil fuel production in Canada continues to grow, driving increases in Canada’s overall greenhouse gas emissions.