This one-off is much more than it appears to be. Along with finalizing the fall date on a permanent basis, the government is also restructuring how it determines spending.
By Sheila Copps
First published in The Hill Times on October 13, 2025.
OTTAWA—Elections and budgets seem to stall governments. When it comes to an election, no one knows the outcome, so the bureaucracy must go into a holding pattern while they await the outcome.
As for budgets, bureaucrats are loath to make new commitments or policy changes until they know what impact the budget will have on their operating costs.
Last week’s announcement that future budget dates will be moved from the spring to the fall was met with a yawn by most Canadians.
While the business world needs financial certainty to make investment decisions, ordinary people don’t really care whether the work is announced in the spring or the fall.
In the current circumstance, the government had to change the date this year to accommodate the delay caused by the April election, and the change in cabinet.
A new finance minister needs time to be briefed on all the issues, and to make financial decisions.
But this one-off is much more than it appears to be. Along with finalizing the fall date on a permanent basis, the government is also restructuring how it determines spending.
The intention is to make it clearer that long-term capital investments are a different line item than regular operational costs.
The Conservative finance critic Jasraj Hallan immediately attacked the announcement of this new approach. He claims that what the government calls “Modernizing Canada’s Budgeting Approach” is merely another way of “cooking the books.”
But the government is insisting that the new financing mechanisms are consistent with international guidelines. The autumn budget means that the bulk of the government spending decisions will happen after the April fiscal year end, which should bring spending habits closer to actual financial reality.
The insistence that the government differentiate between operational costs and long-term capital investments will help Canadians understand why, in some instances, current deficits build up long-term equity.
To the ordinary person, the analogy would be a mortgage. If you hold debt in order to build equity, such as in the owning of a house, you are investing in the future, not simply spending.
If the same amount of money is spent on disposable items like clothing or coffee purchases, they are obviously not appreciating assets and need to be viewed differently.
Just as a mortgage is worth holding for a family, national investment in housing stock, public transit, and major infrastructure projects can easily be understood as capital expenditures for long-term Canadian economic stability.
If we don’t spend on capital expenditures, like housing, we find ourselves in a housing crisis like the one that has thrown the country into turmoil.
For the past 30 years, the federal government transferred housing dollars to the provinces with no guarantee that housing would be built. And when it wasn’t, we landed in a crisis of social housing that will take a decade to overcome.
A plan to treat that investment separately from general government-service spending may be better understood by the public, but not everyone agrees.
The interim parliamentary budget officer Jason Jacques says that the definition of capital expenditures is too broad, going beyond international standards. The former parliamentary budget officer disagrees, saying the new accounting is additional information to what will continue to be provided to Canadians.
Conservative MP Pat Kelly also attacked the changes, saying “Debt is still debt at the end of the day—doesn’t matter how many columns you try to present to Canadians.”
With the fall budget date, most departments will likely be changing the way they manage year-end spending. In the current climate, most departments try and spend all the money in their budgets before the end of March, which is the fiscal year-end. If surplus funding lapses, their next budget could be reduced as a consequence.
With the government plans to reduce operational spending, the appetite to accelerate year-end spending will be blunted.
At the end of the day, most Canadians will pay little attention to these changes. In general, people don’t even fully understand the difference between an economic statement and a budget. Departments will be following closely, as will the business world.
The separation between operational spending and capital investment will provide a better snapshot of government priorities, like mega-projects meant to stimulate the economy, or capital investments in public infrastructure.
The Finance Department is characterizing these decisions as generational investments.
But governments generally only get credit for what is happening in the short term. Long-term planning has never been a political strong suit.
Sheila Copps is a former Jean Chrétien-era cabinet minister and a former deputy prime minister. Follow her on Twitter at @Sheila_Copps.
