Budget Response - From Throne Speech to Budget 2021

When Toronto350 graded the federal Speech from the Throne in September 2020, we considered whether it represented an appropriate response to the interlocking health, economic and climate crises. The 2021 Budget puts funding behind the Throne Speech’s promises, and so we ask again, does this Budget support Canadians in a just recovery and a transition to a low-carbon economy?

This budget comes out at a challenging and critical time, one that demands an emphasis on COVID-19 recovery. It also comes at a time when we must respond to the ongoing climate emergency. Both of these crises create similar impacts - threats to health, to social and environmental ecosystems. Both also have similar roots - unchecked economic growth that encourages a profit-before-people mandate and devalues the natural world. While there are elements that are positive, even ambitious - like universal childcare and increased, permanent investment in municipal public transit - from a Just, Green Recovery perspective, the “Budget for Recovery, Growth and Resilience“ falls short of promising the changes we need to see now. 

First of all, there are some major gaps - ongoing colonialism, market-dependence and a continued focus on extraction. These gaps back up a continued emphasis on growth, exports and heavy-emitting industries, found even at the very hub of climate plans. Measures that would facilitate deeper changes and spur emergency level action, like using federal levers to deter the financial industries investments in fossil fuel or large-scale direct public investments coupled with the creation of new crown corporations, are absent. Instead, there is an emphasis on subsidies, tax incentives and other supports to coax choices that may create and safeguard a liveable world for all. Which brings us to the last major flaw - the budget doesn’t represent the scale of the emergency we face, and the action it is likely to inspire represents too little, too late. The approach is simply not transformational. 

Given the challenges and crises we face, we need full-scale transformation - a broad, ambitious plan that centres justice, equality, true Indigenous partnership and reconciliation, progressive taxation, a just transition for affected workers, and a society-wide commitment to care-giving.

This transformation is possible! 


Indigenous Justice, Recognition and Reconciliation

The 2021 Budget has allocated $18 billion for Indigenous communities. It is heartening to see an increase, compared to previous budgets, though much remains to be done to uphold Indigenous rights and sovereignty as well as realize the potential synergy of Indigenous justice, climate action, and a Just Recovery.

The key to effective action is the recognition of Indigenous leadership and right to self-determination. As expressed in Indigenous Climate Action’s March 2021 report, Decolonizing Climate Policy in Canada, Phase 1 (Pg. 8), “While ongoing colonial capitalism is driving both the climate crisis and intensifying racial and gender-based inequality, Indigenous communities and Nations, often led by Indigenous women, are offering rich, diverse and urgently needed alternative values, worldviews, social organization and economic systems.” [1] It is telling that the measure most specifically concerned with climate in Chapter 8 of the Budget, “Strong Indigenous Communities,” was among the least funded.

It is vital that the government’s actions result in a just distribution of benefits. Though Indigenous communities are often referenced as stakeholders, there is little indication of how the government plans to ensure these communities are at the table when implementation decisions are made. 


Health and Wellness

Of necessity, measures in the 2021 Budget to protect Canadians’ health and wellbeing are largely linked to COVID-19, including access to vaccines, safe air travel and mental health support. Encouragingly, the budget also includes promising measures to improve climate-impacted health and wellness. But while they acknowledge that “the case for national universal pharmacare is well-established,” the government’s continued failure to move forward on it is disappointing.


The Social Safety Net

The 2021 Budget represents a strong commitment to Canada’s social safety net. Among the significant commitments are universal child care and raising the federal minimum wage to $15. While the long-term impact of the pandemic and the resulting economic crisis are still unknown, this Budget, following a year of effective emergency measures, is a more than credible effort to “build back better.” It is to be hoped that the announced consultations on permanent reforms to Employment Insurance result in a more comprehensive service.



The 2021 Federal Budget’s title, “A Recovery Plan for Jobs, Growth, and Resilience” implies that its focus would be on resilience and building for a resilient future. We were glad to see investments in disaster mitigation and adaptation, as well as the intention to renew the Standards to Support Resilience in Infrastructure. However, this is not enough to build a resilient future. Resilience demands systems which can protect vulnerable people and communities from at least foreseeable threats. The pandemic has shown us how far we are from true resilience.



The question we must ask is - who is the government building solidarity with? Is it with our communities, or is it with corporations and banks? If we look at the 2021 Federal Budget - it seems to be the latter. While corporations are supported through wide-ranging initiatives like the Net Zero Accelerator and tax credits for carbon capture projects, meaningful solidarity does not extend to communities marginalized by Canadian society. The investments in youth, in long term care, and in the populations who will be impacted most by our changing climate, are inadequate by any measure.


Revenue Generation

Accelerating inequality, low government revenue and the need for unprecedented public spending create an ideal opportunity for taxation as a tool of income and wealth redistribution, as well as revenue generation. But there is no real effort to tackle inequality in the Budget - no wealth tax on the super-rich, no capital gains tax increases, no surtax on billionaires (who are profiting during the pandemic), no rise in corporate tax rates. As there is a strong link between exploitation, income disparities and carbon emissions, this signifies a failure to change the power dynamics and imbalances that lead to the crises we face. Wealth continues to create more wealth and leaves the majority behind. 



The Budget includes unprecedented investment in programs like loans for building retrofits and support for Agricultural Climate Solutions. It includes a 50% tax cut for companies that manufacture zero emission products like solar panels. It proposes the first ever Federal Green Bond to fund green initiatives. In summary, it promises $17.6 billion for a green recovery with an emphasis on the creation of middle class jobs. However, to adequately respond to the emergency, investments should be many times higher coupled with a stronger regulatory approach

After admitting that 17 large emitters, a mix of oil sands, steel, refining, and a pipeline, cause about 78 million tonnes of Canada’s emissions, the government’s stated intention is “to keep these industries strong, resilient and prosperous in Canada – for generations to come.” (A Healthy Environment and a Healthy Economy) To underscore this goal, the budget contains many measures that could be categorized as fossil fuel subsidies - funds and incentives for things like hydrogen and Carbon Capture Utilization and Storage (CCUS) that may decarbonize heavy emitters incrementally but ultimately serve to prolong and maintain polluting industries.

To seriously address the climate emergency, an end to fossil fuel production and carbon-emitting activities must take place. Yet, there are no plans to decrease lending to the fossil fuel industry. Instead, the government made ongoing investments in high-carbon infrastructure like the TransMountain Pipeline, spending $18 billion in 2020 on the oil and gas industry. Given that the coal phase-out is expected to reduce more emissions than all other actions combined in Canada's current climate plan, how much more could a well-managed, rapid phase-out of polluting oil and gas benefit us!

There is also an emphasis in the budget on maximizing the ability of forestry, farming and mining to supply clean fuels and clean technology components. This approach maintains a reliance on resource extraction, whether for the creation of “blue” hydrogen, wood products or mineral resources. For a transformative approach, one more equal to the challenge, we need goals that prioritize deep decarbonization, climate, social and economic justice and well-rounded climate actions. (see the SCAN report, The Liberal Climate Action Formula, a Recipe for Failure for more on this topic).


Workers and Communities

A just, green recovery for workers and communities needs to include support for fossil fuel workers and others affected by the move to a low-carbon future. Some initiatives in the Budget, like investments in skills training that include an Apprenticeship Service fund, can be considered legitimate just transition spending; however, the estimate for an appropriate investment is considerably higher, about $16.5-40 billion a year.

Since the Budget was tabled, the government did announce long-delayed consultations towards a Just Transition Act. The act needs to be strong. It should provide not only income support for all affected workers, but economic diversification that allows for good, green, long-term jobs. Another key element includes workforce development that prioritizes those historically excluded from the skilled trades. (see Roadmap to a Canadian Just Transition from the Canadian Centre for Policy Alternatives for more on this topic).

The consultations on the Just Transition Act are a welcome development, but there is no time to waste. A planned, orderly transition should have begun decades ago! We need the federal government’s full and honest commitment to rapidly move away from fossil fuels and to centre workers and communities in the process. 

Low-Carbon Care Work

A just transition also involves a re-valuing of care work and other low-carbon work. It must challenge and change the drivers and mechanisms that perpetuate social, economic and environmental injustice. Improved workers’ rights, wages, benefits and conditions for the workers who do low-carbon work - often migrant, women and racialized workers - are essential. 

The Budget offers some programs that may impact job quality and security for workers in these sectors. For example, amounts given to the provinces and territories to attract and retain early childhood educators and a Migrant Worker Support Program to help community-based organizations provide services. Another promise is to streamline Canada’s Express Entry system. However, 1.8 million migrant workers and international graduates are immediately excluded from the short-term immigration program. (see Exclusion, Disappointment, Chaos & Exploitations: Canada’s New Short-Term Immigration Pathway from Migrant Rights Network for more information).

While some of these measures potentially represent an improvement, there seems to be an emphasis on the needs of the labour market and economic benefit, not on a transformative or bold approach that challenges the underlying system or proposes to put workers and communities first. To truly “build back better,” the injustices that colonial extractive capitalism engenders must be fully named and redressed, for the sake of both people and the planet.


In Conclusion

For the budget to support a Just, Green Recovery, it needs to further many interconnected goals including Indigenous rights, equity, a strong social infrastructure and a just transition. It must build solidarity and resilience. And of course, it must respond to the pandemic and more broadly, safeguard the health and wellbeing of all. The “Budget for Recovery, Growth and Resilience” takes some steps toward each of these things, but falls short of visionary. We still can’t see the tops of the mountains we need to climb.


[1] Decolonizing Climate Policy in Canada, Indigenous Climate Action, in collaboration with researchers Dr. Jen Gobby, Rebecca Sinclair, and Rachel Ivey, March 2021.

If you're interested in more responses, see the table below. In it, we looked at some of the Budget programs and policies from a “yes,” “and” “but” perspective.


Policy Yes And But
Indigenous Justice, Recognition and Reconciliation

Total of $18 billion for Indigenous communities


An increase of funds from previous budgets


The key to effective action is the recognition of Indigenous leadership


There is little indication of how the government plans to ensure Indigenous communities are at the table when implementation decisions are made.

$22.7 million over 5 years for health impacts of climate change

Includes access to country food, impacts of extreme weather events, and mental health impacts of climate change on youth

Most specific climate related language used in the chapter on programs to support Indigenous communities

Surprisingly little considering the needs of the community in this area and the impact of climate change

$6 billion over 5 years for infrastructure development


What kind of projects are to be prioritized or how the funds would be disbursed was not specified.



$31.5 million over 2 years to implement UNDRIP


To “support Indigenous self-

determination and enhance nation-to-nation, Inuit-Crown and government-to-government relationships.”

Land and water defenders will hopefully be able to claim funding to set up systems of stewardship, though that has not been made explicit.

UNDRIP implementation, as proposed, would not supersede any existing laws. That may take away from Indigenous Sovereignty. 

$647.1 million allocated to Preserving Wild Pacific Salmon

Includes further engagement with First Nations and fish harvesters



$2.3 billion “to Environment and Climate Change Canada, Parks Canada, and the Department of Fisheries and Oceans to address conservation efforts

Includes measures to support Indigenous Guardians, and other partnerships with Indigenous peoples



$17.4 million over 2 years to “Environment and Climate Change Canada to support work with the provinces, territories, Indigenous peoples, and key stakeholders

To build and support more resilient water and irrigation infrastructure



Health and Wellness 

Up to $375 million for international COVID-19 response

“A focus on addressing the health needs of developing countries.”


Beyond crisis response, the pandemic has exposed serious weaknesses and vulnerabilities in Canada’s health and wellness systems which are not meaningfully addressed

$82.5 million for COVID-19 testing infrastructure at airports



Commitment “to work toward the goal of a universal national pharmacare program.

“The government will directly engage with willing partners on national universal pharmacare, alongside other important health priorities, that can be advanced at the provincial and territorial level.”



The Social Safety Net

Up to $27.2 billion over 5 years for child care and early learning

“To build a Canada-wide, community-based system of quality child care.”



$12 billion over 5 years for increases to Old Age Security

A 10% increase beginning in 2022 and ongoing.



$3.9 billion over 3 years to make EI more accessible and simple for Canadians

Forthcoming consultations on future, long-term reforms to EI



$2.5 billion over 2 years to extend the Canada Recovery Benefit and the Canada Recovery Caregiving Benefit

Up to 12 additional weeks of Canada Recovery Benefit to a maximum of 50 weeks


The final 8 weeks of this extension will be paid at a lower amount of $300 per week.

A federal minimum wage of $15 per hour





$1.4 billion over 12 years for the Disaster Mitigation and Adaptation Fund

Wildfire mitigation, rehabilitation of storm water systems, restoration of wetlands and shorelines.

This is not enough to build a resilient future. Resilience demands systems which can protect vulnerable people and communities from at least foreseeable threats. The pandemic has shown us how far we are from true resilience.

$11.7 million over 5years to renew the Standards to Support Resilience in Infrastructure Program

To “help communities to plan and build roads, buildings, and other infrastructure that is more durable and resilient to a changing climate.”


$12 billion over 5 years for increases to Old Age Security

A 10% increase beginning in 2022 and ongoing.



$3 billion over 5 years for standards in Long-Term Care.

To work collaboratively with provinces and territories



$200 million for new Black-led Philanthropic Endowment Fund

To “create a sustainable source of funding, including for Black youth and social purpose organizations, and help combat anti-Black racism and improve social and economic outcomes in Black communities.”



$100 million for the Supporting Black Canadian Communities Initiative

Supports capacity-building of Black-led non-profit organizations



$376 million over 5 years to improve access to the Disability Tax Credit

To “make it easier to be assessed, reduce delays, and improve access to benefits.”



$146.9 million over 4 years to strengthen the Women Entrepreneurship Strategy




$51.7 million over 4 years for the Black Entrepreneurship Program




$42 million over 3 years to expand the Aboriginal Entrepreneurship Program




Revenue Generation

New tax on luxury cars, boats and personal aircraft.




There is no real effort to tackle inequality in the Budget - no wealth tax on the super-rich, no capital gains tax increases, no surtax on billionaires (who are profiting during the pandemic), no rise in corporate tax rates.



Digital Services Tax



Initiative to develop Beneficial Ownership Transparency


May support a future wealth tax by ensuring that corporate property can be traced to its human owners



$56.1 million over five years, for codes and standards

$9.6 million over three years 2021-22, for a Critical Battery Minerals Centre of Excellence & $36.8 million over three years for R & D

A promise to work with United States to increase availability of ZEVs. Also, a promise to strengthen light and heavy duty vehicle regulations. ($104.6 million over five years)


No ban on gas-powered cars. 

Buying a ZEV still expensive. 

Related critical minerals plan emphasizes growth rather than alternatives to individual vehicles.


Builds on previously announced $15 billion over 8 years and $3 billion ongoing, for municipalities 

one-time investment of $2.2 billion to municipalities and First Nations

$491 million toward high frequency rail infrastructure in the Toronto–Quebec City corridor

Funds for things like developing next steps to electrify public transit.

Commitment to develop a national active transportation strategy and conduct a national infrastructure assessment. 


Not enough. For example, $2.75 billion over five years is earmarked for converting public transit to electric. It’s estimated to cost up to $30 billion to electrify all of Canada’s public buses. 


adds $4.4 billion on a cash basis over 5 years for interest free loans up to $40,000 for “deep home retrofits.” 

low-emissions building materials supply chain

retrofit code for existing buildings by 2022, in place 2025

net-zero energy ready model building code 2030

Very good move, to increase energy efficiency in buildings.

Includes a stream for low-income and low-income rental properties, coops/not for profits Gov of Canada building goals.

Includes funds dedicated to Indigenous communities, green and inclusive community buildings that include community benefits.


It is not enough and will not get us where we need to be

The loan program is largely dependent on home-owners and other property owners and truly deep retrofits are costly.

High efficiency, gas-powered furnaces are included in the list for deep retrofits.

Strategic Innovation Fund - Net Zero Accelerator 

$5 billion over seven years  + 1 billion to propel clean tech industry

Accelerating the adoption of clean tech and innovative net-zero tech is essentially a good goal.

extended list for the 50% tax cut: pumped hydraulic energy storage, renewable fuel production, water current, wave/tidal, active solar heating, geothermal.

More emphasis on renewables (wind, solar) needed and measures in addition to ones like the $964 million to advance renewable energy and grid modernization projects across the country. 

A significant part of investments go to help heavy industry decarbonize and for technology that includes things that may well bolster and prolong polluting industry, like “blue” hydrogen, carbon capture and storage and Small Nuclear Reactors.

Low Carbon Fuels and Clean Fuel Standards

$54.8 million over two years - Forest Industry Transformation program

$319 million over seven years R & D for CCUS

To implement and administer the Clean Fuel Standard - $67.2 million over seven years

In theory this sounds great! We need clean fuel standards and measures to bring in low-carbon and zero-emissions fuels. 


Hydrogen + CCUS

Small Modular Nuclear Reactors - should not really be considered green.

Maximizing forestry and farming bio-economies - emphasis on growth is unsustainable.

Indigenous rights violations occur when nature-based solutions that require land use, forests etc. are purchased by industry to offset their emissions instead of reducing them directly.

Strategic Partnership

$36 million over three years

$40.4 million over three years - hydroelectricity and grid interconnections in North

building local capacity for clean energy projects with First Nations, Inuit and Métis and “representative organizations.”

Support for rural, remote and Indigenous communities to move from diesel to clean energy by 2030. 

Indigenous groups are systematically excluded from renewable energy policy and programming in Canada.


Will UNDRIP and other human rights be honoured? Will process and policy allow leadership outside of current economic systems instead of demand conformity to systems that have perpetuated harm?

Agricultural Climate Solutions program

$40.4 million over two years

$60 million Nature Smart Climate Solutions Program - wetlands and trees on farms 

$10 million over two years - Agriculture and Clean Tech

Support for agricultural climate solutions - on-farm climate action - improved nitrogen management, cover cropping and rotational grazing - powering farms with clean energy


consider more support for small, regenerative and organic farmers, city farming


Have we caught up to other countries who are leading in this area?


25% by 2025

further wetlands, forests, plant trees and work with Indigenous Guardians, Indigenous Protected and Conserved Areas

Accept ongoing land stewardship under treaty rights and stop policing and criminalizing land defenders. 

Of Note: Canada has one of the highest cut-down rates in world. Canada’s managed forests are a net emitter of GHG for past 15 or so years (monoculture approach + fires and pests)

Acknowledge the carbon outputs from forest fires etc. deforestation, development and calculate them accurately. 

Carbon sinks are not a compensation for extracting and burning fossil fuels.


Workers and Communities - Just Transition, Low Carbon Care Work

Early Childhood Education

amounts given to the provinces and territories to help attract and retain early childhood educators.






It is uncertain if these investments and programs will significantly change the underlying conditions that people who take on low-carbon work, including social service, health support and child-care work, face.

Deep, sustained change, including a re-examination of current economic models and significant wealth re-distribution, are needed for social, economic and environmental justice.

Charities, Non-Profits, other Social Organizations

Social Finance Fund to attract private sector capital 

new line of credit to social enterprises

making amendments to the Canada Small Business Financing Act so that non-profits and charitable organizations can be borrowers

temporary Community Services Recovery Fund.

Personal Support Workers

Group Tax Free Savings Account administered through Service Employees International Union Healthcare.

Migrant Workers

Migrant Worker Support Program to help community-based organizations provide services

increased employer inspections and an improved process for obtaining open work permits.

Streamlining Canada’s Express Entry system and amendments to the Immigration and Refugee Protection Act.


The “Exclusion, Disappointment, Chaos & Exploitations: Canada’s New Short-Term Immigration Pathway” finds that more than 1.8 million migrant workers and international graduates are excluded from the budget’s proposed short-term immigration program.

Training, School and Work Placement

Canada Recovery Hiring Program 

Sectoral Workforce Solutions Program - $960 million over three years

apprenticeship service for Red Seal trades in construction and manufacturing - $470 over three years - $10,000 training subsidies for women or BIPOC apprentices

Skills for Success program - $298 over three years

Of Note:  investments to extend high-speed broadband into more rural and remote areas.

help with re-hiring or hiring costs, to develop and provide training and to prepare employees for knowledge economy jobs

-student work placement, a youth employment and skills strategy, and summer jobs initiative

-continued investment in green jobs for youth like the NRCan: Science & Technology Internship Program.

- investments to Yukon College and in converting Aurora College into a polytechnic university.


Just Transition Act needs to be strengthened and implemented.


Investment in a Just Transition should be about $16.5-40 billion a year. For more ideas see: Roadmap to a Canadian Just Transition from the Canadian Centre for Policy Alternatives