OTTAWA — Prime Minister Mark Carney addressed the media on a sunny Wednesday morning in Toronto’s North York, revealing that his government’s first budget this fall will include austerity measures. Speaking before a two-day cabinet retreat, Carney acknowledged the challenges of implementing such measures while also investing in the economy.

“It’s an austerity and investment budget at the same time, and that’s possible if we are disciplined,” Carney stated in French. He emphasized the need for fiscal discipline, noting that federal government spending had increased by over seven percent annually over the past decade, outpacing economic growth. This comment appeared to be a critique of his Liberal predecessor, Justin Trudeau.

Carney stressed the importance of controlling spending and finding efficiencies to allow for significant investments. He stated, “We need to rein in spending, we need to find efficiencies… that create the room for these big investments.” Despite the focus on austerity, he assured that certain sectors would remain protected, including health care, education transfer payments, and direct payments to individuals, such as Old Age Security.

In preparation for the budget, federal ministers have submitted plans to reduce their departments’ and agencies’ spending by 15 percent over the next three years. Only a few organizations, like the RCMP and the Department of National Defence, have been exempted or given reduced targets.

Details about Carney’s first budget remain limited. Initially, it was not expected to be released this year, but public demand prompted the Prime Minister to commit to a fiscal plan this fall. As part of the spending reviews, several departments have already announced staffing cuts, which may lead to tensions between Carney’s government and influential public sector unions in the coming year.

Additionally, Carney reported having a “very constructive” conversation with U.S. President Donald Trump earlier this week. He indicated that both nations are working on smaller, sector-specific agreements, as Canada seeks to persuade the U.S. to lift tariffs on steel, aluminum, automobiles, and lumber.