Poilievre demands Carney cap deficit at $42B in letter

Poilievre is demanding Prime Minister Mark Carney cap federal deficit spending at $42 billion, warning that exceeding this limit will only intensify Canada’s crushing affordability crisis.

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Conservative Leader Pierre Poilievre is demanding Prime Minister Mark Carney cap federal deficit spending at $42 billion, warning that exceeding this limit will only intensify Canada’s crushing affordability crisis.

The demand comes as the Liberal government signals its upcoming budget will feature a “substantial” shortfall with no target for balance. While Carney has rejected the idea of austerity, he confirmed in a news conference that the deficit will be “bigger than it was last year.” Government House Leader Steve MacKinnon said the Liberals intend to “spend less and invest more,” but repeatedly declined to provide figures, instead pointing to major new spending in housing, defence and economic expansion.

According to a July estimate from the C.D. Howe Institute, the deficit could rise to over $92 billion for the 2025–26 fiscal year, with annual deficits averaging $78 billion over the next four years. These projections far exceed Ottawa’s public forecasts. If realized, the report warns, Canada’s net debt could rise to 44 per cent of GDP by 2029.

Poilievre’s letter, dated Oct. 20, frames the current situation as a continuation of a decade-long pattern of Liberal overspending and economic mismanagement. “People cannot afford life in Canada after ten years of Liberal government,” the letter reads. “You need to reverse course and join with Conservatives to restore Canada’s promise, that hard work is rewarded, food and homes are affordable, streets are safe, and our economy is self-reliant.”

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READ POILEVRE’S FULL LETTER

Read Poilevre's full letter

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He accuses Carney of breaking key promises made seven months ago, including pledges to reduce the deficit and double housing construction. Instead, Poilievre says, deficit spending has doubled and the housing agency is forecasting a 13 per cent drop in construction over the next three years. At the same time, nearly $48 billion in net investment has fled the country.

Inflation, particularly on food, is a central theme. The letter argues food costs have risen 48 per cent faster in Canada than in the U.S. since Carney became prime minister. Poilievre points to over two million monthly food bank visits nationally and four million expected visits in the Greater Toronto Area this year, nearly double the 2023 total, as evidence that the cost-of-living crisis is deepening.

He also cites OECD projections that rank Canada as second-to-last among 48 countries for per capita growth between 2025 and 2030.

He blames what he calls the “alchemy” of Liberal fiscal policy, the belief that deficits will spur growth, for stagnant productivity and economic decline.

The letter singles out federal debt interest payments, now expected to cost $55.3 billion annually, as a growing burden. Poilievre argues that before a dollar is spent on health care or housing, each household will pay more than $3,300 in taxes just to service federal debt.

Calling for an “affordable budget for an affordable Canada,” he urges Carney to eliminate so-called hidden food taxes, including carbon pricing on farm fuel, fertilizer, and packaging, and to reduce taxes on income, investment, homebuilding and energy. He also calls for broad spending restraint, including cuts to government bureaucracy, consulting, foreign aid, corporate subsidies and what he describes as payouts to false refugee claimants.

The core demand, however, is clear: keep the deficit under $42 billion, the benchmark set by the previous government, and avoid pushing the country deeper into debt.

“We don’t need another lecture from the ones who caused the crisis,” Poilievre writes. “We need results that put Canadians first.”