Prime Minister Paul Carney’s first budget is drawing praise from manufacturers, homebuilders and other groups after the Liberal government introduced a plethora of proposed new federal investments.

But First Nations and small businesses are feeling left out.

As expected, the proposed budget emphasizes large investments as the Carney government seeks to offset the effects of U.S. tariffs on Canada’s weakening economy. The budget includes $141 million in new spending over the next five years.

Canadian Manufacturers & Exporters said Budget 2025 delivers key gains for manufactures facing U.S. tariff pressures. But the group wants more tax and regulatory changes.

“This budget takes meaningful steps to support manufacturers under pressure and acknowledges the critical role our sector plays in Canada’s economic future,” said Dennis Darby, CME’s president and CEO. “Immediate expensing for manufacturing equipment and buildings, SR&ED enhancements, and new trade infrastructure investments will help manufacturers compete, but deeper tax and regulatory reforms are still needed to ensure the sector can not only survive but thrive amid U.S. trade pressures.

“Building long-term industrial resilience in a volatile global trade environment must remain the ultimate goal.”

The Canadian Construction Association praised the government for putting construction “at the heart of Canada’s economic strategy through investments in infrastructure, defence and housing.”

“Canada has underinvested in critical infrastructure for decades,” said Rodrigue Gilbert, president of the CCA. “These investments reflect the essential role of housing-enabling infrastructure in addressing the national housing shortage and committing substantial resources to these projects.”

The CCA welcomed investment in the new Major Projects Office, whose mandate is to invest in developments slated for fast-tracked approvals. Through the budget, Ottawa has recognized that “for too long, the construction of major infrastructure in Canada has been stalled by arduous, inefficient approval processes,” said Gilbert.

But the CCA continued to call for a co-ordinated national workforce strategy that connects immigration, apprenticeships, upskilling, and the destigmatization of careers in the skilled trades.

The Carpenters’ Regional Council said Budget 2025 recognizes that labour is a key partner in infrastructure and housing investment.

“As these projects move forward, workforce development remains essential to ensure our country has the skilled workers needed to deliver on its commitments,” said the council.

The group praised the government for boosting the Union Training and Innovation Program (UTIP) to $75 million over three years and demonstrating a clear commitment to supporting the industry-led training that the carpenters’ union offers.

“For years, CRC training initiatives have been supported by UTIP, investing in equipment and targeted training programs to upskill thousands of workers in key sectors in the construction industry,” said the council. “This renewed investment will strengthen the CRC’s ability to deliver skilled trades programming and connect apprentices directly to good union jobs.”

The Federation of Canadian Municipalities also expressed support, contending that recognizes the importance of local infrastructure in meeting Canada’s housing, trade diversification and economic goals. But without a sustained, long-term plan at scale, the Carney government’s ambition “won’t match the scale or urgency of the challenge,” the FCM asserted.

“Budget 2025 acknowledges that municipal infrastructure is essential to Canada’s productivity and trade,” said Rebecca Bligh, a Vancouver city councillor who serves as the group’s president. “New and reprofiled investments will help communities move faster on some things now, but a long-term plan at scale to fund the infrastructure that makes national housing and economic goals achievable is still needed.”

The FCM noted that a significant portion of the planned spending includes existing commitments that communities have already incorporated into their long-term plans. Without a sustained infrastructure plan at scale, Canada’s ability to to meet its goal of building 500,000 new homes per year is at risk, the group charged.

The finance package includes a proposed $50-billion Local Infrastructure Fund, which will include money for housing, transportation and healthcare-related infrastructure projects.

But Alberta’s Treaty 6, 7, and 8 First Nations said the budget “returns Canada to a legacy of failure” when it comes to supporting Indigenous groups. The Chiefs Steering Committee on Technical Services (CSC) said it is “profoundly shocked by the abandonment of Canada to its commitments under its 2024 Treaty Bilateral Table on Water and Related Infrastructure.”

The group called the funding outlined for First Nations “dramatically insufficient” to address infrastructure gaps across Alberta, particularly around clean water. The budget also fails to deliver on Ottawa’s reconciliation promises and continues unjust differences in living conditions for First Nations, the group argued.

“Prime Minister Mark Carney’s first budget is just fancy words on status quo,” Chief Troy Knowlton of Piikani Nation, Treaty 7 Territory. “The funding for clean water and infrastructure is simply maintaining progress on active projects, including those focused on water advisories, among hundreds of others. It is a small drop in the giant bucket that Canada created.”

Dan Kelly, president of the Canadian Federation of Independent Business, called the budget “a missed opportunity to provide tax relief to employers.”

The government could have taken the reins by reducing the small business corporate tax rate, freeing up millions of dollars for investment in employees, technology and operations,” said Kelly.

“Government finances are a mess, but the budget just slows the growth in program spending with overall deficits above $50 billion per year as far as the eye can see. “Small firms have learned the hard way that today’s deficits are tomorrow’s taxes.”

By focusing on unionized labour, the $51-billion Building Communities Fund would effectively excludes 90% of small businesses, said the CFIB. The group also charged that the $1-billion Regional Tariff Response Initiative delivered by regional agencies excludes half of small businesses that would be deemed too small or in the wrong sector.

Arguably, the budget marks Carney’s first major test since he replaced Justin Trudeau as prime minister in the spring.

But the budget will require support from opposition MPs that the Liberals do not have yet. A budget vote is automatically considered a confidence vote in the House, and the government will fall if the funding plan is rejected.

Carney could also win support for the budget if a sufficient number of opposition MPs are absent when the vote is held. His task became a bit easier this week as former Conservative MP Chris d’Entremont crossed the floor to join the Liberals.

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