Government of Canada modernizes its budgeting approach to deliver generational investments

From: Department of Finance Canada

News release

October 6, 2025 - Ottawa, Ontario - Department of Finance Canada

The global economy has changed – and Canada must change with it.

Today, the Honourable François-Philippe Champagne, Minister of Finance and National Revenue, announced a new approach to federal budgeting that reflects the urgency of this moment and better positions Canada to build the homes, infrastructure, and industries our economy needs to grow. As the global economy is undergoing fundamental changes, we must build our economic strength so we can empower Canadians with greater certainty, security, and prosperity.  

To this end, the Government will introduce a new Capital Budgeting Framework. By distinguishing day-to-day operational spending from capital investment, this new framework will guide decisions and help prioritize investments that generate long-term benefits for Canadians, such as major projects, housing, clean energy, and infrastructure that will help grow our economy and attract private investments. It will enhance—not replace—existing financial reporting, while providing a clearer picture of the investments that strengthen Canada’s economy for decades to come. The Public Accounts of Canada will remain fully compliant with Public Sector Accounting Standards.

The government is also modernizing its budget cycle to better align with the needs of builders, businesses, investors, provinces, territories, and municipalities. Starting with Budget 2025, the federal budget will be tabled in the fall, with an economic and fiscal update released in the spring. This change will provide the certainty and predictability needed to plan ahead and ensure projects can begin as soon as construction season starts – helping every level of government make smarter, faster investment decisions.

Together, these changes mark a new era in how we plan and deliver – catalyzing generational investments that empower Canadians by building Canada’s economic strength.

The Government of Canada will release its full plan on November 4 with Budget 2025.

Quotes

“Today, we’re laying a stronger financial foundation for Canada. By moving to a fall budget cycle and introducing a new capital budgeting framework, we’re making better-timed and more transparent decisions. This is how we’ll deliver generational investments that build Canada Strong.”

- The Honourable François-Philippe Champagne, Minister of Finance and National Revenue

Quick facts

  • Under the new Capital Budgeting Framework, capital investment is defined broadly as any government expense or tax expenditure that contributes to public or private sector capital formation, held directly on the government’s balance sheet or on that of a private sector entity, Indigenous community or another level of government.

  • Spending that is not categorized as capital investment would be considered day-to-day operating spending. This will include major government expenditures like transfers to persons, health and social transfers, and the costs of running government operations and services, including salaries and benefits.

  • Having a budget in the fall—well ahead of the new fiscal year—will mean:

    • Greater predictability and better planning for organizations, businesses, provincial and territorial budget planners, and Canadians.
    • More budget measures can be included in time for the Main Estimates, enabling parliamentarians to better oversee public expenditures. This responds to calls by the House of Commons Standing Committee on Government Operations and Estimates (OGGO) and the Parliamentary Budget Officer (PBO) for greater alignment between the budget and Main Estimates, which must be tabled in Parliament by March 1st every year.

  • As a responsible fiscal manager, the government remains committed to ensuring the objectivity and integrity of its financial statements, which are presented in the Public Accounts of Canada. Results in this form will continue to be based on Canadian public sector accounting standards.

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Contacts

Media may contact:

John Fragos
Press Secretary
Office of the Minister of Finance and National Revenue
john.fragos@fin.gc.ca

Media Relations 
Department of Finance Canada 
mediare@fin.gc.ca 
613-369-4000

General enquiries

Phone: 1-833-712-2292 
TTY: 613-369-3230 
E-mail: financepublic-financepublique@fin.gc.ca

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2025-10-06