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Canada’s municipal leaders are sounding the alarm over a potential $5 billion reduction in transit funding, as they press Prime Minister Mark Carney to reverse what they view as a detrimental budget decision. The Federation of Canadian Municipalities (FCM) has informed its members that federal officials have indicated this significant cut will be implemented over the next decade, raising concerns among big-city mayors who met with Carney in Ottawa this week.
A Shift in Priorities
The FCM’s apprehensions stem from recent revelations regarding the Liberal government’s budget, released on November 4, which introduced the Build Communities Strong Fund. This ambitious initiative, set to allocate $51 billion over ten years, was branded as a revolutionary approach to infrastructure development in Canada. However, within this framework, the government also outlined plans to achieve approximately $60 billion in internal savings.
While the FCM initially welcomed the budget, new insights from private discussions have sparked unease. Rebecca Bligh, the president of the FCM and a city councillor in Vancouver, explained that while the government has established new programmes, the crucial Canada Public Transit Fund (CPTF) appears to be significantly scaled back.
The Implications of the CPTF Reduction
The CPTF, launched in 2024, was designed to provide municipalities with $3 billion annually for transit projects starting in the 2026-27 fiscal year. However, the FCM has discovered that the transit transfer programme is expected to deliver around 16% less funding over the next ten years, equating to an estimated $5 billion shortfall. This information has prompted a direct appeal from Bligh and 16 other mayors who are urging Carney to reassess this decision during their meetings in the capital.
Bligh highlighted a critical flaw in the government’s strategy: the restructuring of funding programmes has forced cities to compete with provinces and territories for essential resources, even in areas where municipalities do not have direct oversight, such as health and postsecondary infrastructure. She remarked, “There’s no programme to administer the funding, and also, there’s no significant new funding that will actually allow municipalities to do more at the pace that the federal government has set up.”
Striking a Balance
Further complicating matters, the federal budget’s annex contained summaries from major departments on their efforts to identify savings. The Department of Housing, Infrastructure and Communities reported a recalibration of government programmes that would lead to significant reductions in funding, including to the CPTF. However, a discrepancy arose between the printed and electronic versions of the budget regarding the extent of these cuts.
While the printed edition explicitly mentioned a funding reduction, the electronic version described a reallocation of uncommitted funds from the CPTF to the Build Communities Strong Fund, without specifying a dollar amount for the reductions. Finance Department officials have clarified that the electronic version holds the accurate details.
Responses from Stakeholders
In response to these developments, Renée LeBlanc Proctor, a spokesperson for Infrastructure Minister Gregor Robertson, confirmed that while there would indeed be a reduction to the CPTF, public transit projects will still be eligible for funding from both the CPTF and the new $51 billion fund. Furthermore, Marco D’Angelo, president and CEO of the Canadian Urban Transit Association, echoed the mayors’ concerns, stating that many cities rely on the assured funding for vital projects such as new buses. He emphasised the importance of clarity regarding transit funding to ensure that municipalities can confidently plan for the future.
Why it Matters
The potential $5 billion cut to transit funding could have far-reaching consequences for urban infrastructure across Canada. As cities grapple with increasing demands for public transport and sustainable development, the reduction in available resources threatens to hinder progress and exacerbate existing transit challenges. The ongoing negotiations between municipal leaders and the federal government will be crucial in determining the future of public transit and urban development in Canada, as mayors strive to secure the necessary funding to meet their communities’ needs.
