Let's Talk Politics

Ep 26: Parliament’s Back, But Where’s the Budget?

• Julia Pennella • Season 1 • Episode 26

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The political winds have shifted dramatically in Canada following a transformative federal election that has ushered Mark Carney into the Prime Minister's Office. This episode dives deep into the new government's first moves with expert analysis from Kelly Baker, founder of Informed Advocacy and one of Canada's top lobbyists.

Carney's approach to governance already shows stark contrasts to his predecessor. His cabinet, notably slimmed down to 28 ministers and 10 secretaries of state, with many political newcomers filling key roles. This business-oriented cabinet structure raises questions about whether government can—or should—operate like the corporate world, especially when facing complex challenges like American tariff threats and looming recession concerns.

The historic visit of King Charles III, who delivered the throne speech in Parliament, signals Carney's strategic pivot toward strengthening international relationships beyond the United States. As Kelly explains, this diplomatic maneuver serves multiple purposes: reinforcing Commonwealth ties, demonstrating Canada's international allies, and positioning the country to diversify its trade relationships in uncertain economic times.

Perhaps most controversial is the government's decision to delay the federal budget until fall—a move that creates significant ripple effects for provinces and municipalities that depend on federal funding commitments. Kelly provides insight into how this budgetary uncertainty impacts provincial planning for critical public services from healthcare delivery to housing initiatives and infrastructure planning, revealing the complex interdependencies between different levels of government.

Want to understand how the political chess pieces are moving in Canada's new parliamentary configuration? Listen now for expert analysis on what these early decisions tell us about Carney's governance approach and their potential impact on Canadians across the country.

Quick heads up this episode was recorded on May 27, 2025 so while the news may have changed since this conversation was recorded, the thoughts and ideas still remain relevant. So Let’s Talk Politics with Kelly Baker. 


Julia Pennella:

Parliament is back in session, baby, and we're kicking off a brand new political chapter after one of the most intense federal elections in recent memory. All eyes are now on Prime Minister Carney. Will he deliver on the bold promises that got him elected, or will old Trudeau-era habits creep back in and derail his momentum before it even starts back in and derail his momentum before it even starts? Right out of the gate, carney made some major moves a slimmed down cabinet with just 28 ministers and 10 secretaries of state, and instead of individual mandate letters, he dropped a unified, focused seven-point priority list for the whole cabinet team. We even had a special appearance from Canada's head of state, king Charles, who delivered the throne speech in Parliament, with some calling it a diplomatic mic drop. Channeling both patriotism and authority. The King closed the throne speech with a striking line. As the anthem reminds us, the True North is indeed strong and free. The political energy and excitement following the royals' visit carried straight into Question Period, where things got heated over the government's delay in tabling a spring budget. But what stood out the most from Question Period was the absence of Conservative leader Pierre Palliev. Known for his fiery question period performances, palliev was missing from the House for the first time in nearly 20 years, after losing his Carleton seat to Liberal Bruce Fanjoy. Without his parliamentary privileges, palliev could only watch from the sidelines telling reporters he'd love to be inside Meanwhile.

Julia Pennella:

In provincial politics, ontario just signed free trade agreements with six provinces, including Alberta, pei, nova Scotia, new Brunswick, manitoba and Saskatchewan. All of this in a major push to tear down interprovincial trade barriers and boost local economies amid looming US tariffs and talk of a recession. To help us unpack all of this federally and provincially, we're joined by Kelly Baker, founder of Informed Advocacy. Kelly's a strategic powerhouse with over 20 years of political policy and communications experience of advising premiers, ceos and policymakers. She leads a boutique firm focused on advocacy and communications in healthcare and the nonprofit world and was recently named one of the Hill Times' top 100 lobbyists times top 100 lobbyists.

Julia Pennella:

In this episode, kelly and I dive into why the absence of a federal budget can be problematic for the provinces as they try to plan what Carney's cabinet picks and the throne speech signals to Canadians and stakeholders, and what informed advocacy looks like. Quick heads up this episode was recorded on May 27, 2025, so while the news may have changed since this conversation was recorded, the thoughts and ideas still remain relevant, so let's talk politics with Kelly Baker. Kelly, thanks so much for coming on today.

Kelly Baker:

Thanks so much, julia, for inviting me, looking forward to the conversation.

Julia Pennella:

Yeah, there's a lot to talk about. I feel like anywhere we look something's happening on Parliament Hill or Queen's Park, but I want to ask you, what's your political hot take at the moment, federally and provincially?

Kelly Baker:

what's your political hot take at the moment, federally and provincially? Well, so it has been a very busy few months, both in Ontario politics and in federal politics. I mean, we've just gone through two back to back elections, neither of which were necessarily planned either. So it has been a really interesting time, and I think what's going on in politics right now is really a snapshot of what Canada and both Ontario are dealing with right now in terms of there's a real focus on the economy, on protecting jobs.

Kelly Baker:

I think both the federal government and the province have been quite clear that that's their number one priority right now, and the reality is the trade tariffs continue to be a big threat. We also don't know how long they're going to go on for. So I think the government both levels of government are pretty consistent that this is the number one priority that they want to focus on, and that we need to fight back against the trade tariffs, make sure that jobs are protected and that we don't have a recession, and this is something that's also affecting countries all around the world. So, while there are other important issues, I think it's pretty clear from both levels of government that that's the number one issue they see that they need to tackle at the moment.

Julia Pennella:

Yeah, well said, and I think it's unavoidable of talking about tariffs or trade wars in any of my conversations in today's age. But on that note and we talked about this a little bit before we hopped on the royals are in town, which is a huge deal. We have King Charles set to read the throne speech later today, as we're recording this, and it's a historic moment for Canada's parliament. And what is the signal of having King Charles here in Canada to read the throne speech, considering we haven't had a monarch read the throne speech in a very long time?

Kelly Baker:

Yeah, and I think you know it is a big deal. And I think this signal that Prime Minister Carney is trying to send is again going back to the trade tariffs piece, that they're trying to increase their relationships overseas with other trading partners. He's made it clear that Canada wants to be increasing its trade with Europe and potentially the UK, and I think the other thing is that this is trying to signal that we have strong allies internationally, both in, again, england as a member of the Commonwealth, and I think Canada typically doesn't lean into that very much and we've always shown ourselves to be a strong independent country, but we do rely on the governor general, for instance, to pass bills. So there still is that relationship there. But I think really what the visit of King Charles is trying to symbolize is showing that we have, like I said, other strong international allies and we're going to continue to rely on them, and that we don't just need the United States to be our biggest ally and trading partner, that we have other opportunities as well.

Julia Pennella:

What are your thoughts on Kearney's cabinet picks and the structure of cabinet this time around?

Kelly Baker:

Yeah, I think it's different than people would have expected because it's very different than what the Trudeau cabinet looked like, and there was a lot of questions about like how many people are going to be left over from the Trudeau cabinet, and so we have seen that the Carney cabinet does look very different and about half of the members of cabinet are like new MPs, just elected a little over a month ago. These people have never served in government, a lot of them. But I think what it shows is that Carney's sort of leaning on that private sector experience and that perhaps he wants to see the government be run more like a business. And we've heard a lot of people say that in the past, and I mean the reality too is that Prime Minister Carney also hasn't served in government until now. So I think it kind of makes sense from the perspective that he's bringing in people that have perhaps been successful in the private sector and saying this is what my government's going to look like. We want to tackle issues related to the economy. I need people who have a strong economic background as opposed to people who have more government background.

Kelly Baker:

So I think that's again in trying to create that differentiation, showing we're a new government. We have new priorities. This is a cabinet for, I think, this specific moment in time, with the challenges that they're currently facing with the United States, but I guess there's going to be a learning curve for people, because a number of these people haven't served in government prior to now and we know that government operates very different than the private sector and that government decisions take a long time. There's a long process that needs to follow, so I think people who are used to being able to make decisions and implement them immediately are going to be a little bit surprised as they see how difficult it is to get things done in government and that you need a lot of public support as well, or else you know things can go sideways if the public is not on side with what you're doing.

Julia Pennella:

Yeah, absolutely, and I think that's a lot of my conversations too of it's yet to be seen. Kearney obviously has public service experience, but when you're prime minister there's that different level of pressure and public perception around it. So I take your points on that and interestingly too and this is just like a thought that's come to mind but you said that Carney wants to maybe run government a bit more of a business, and when I think of business I think of networking. So I wonder at what extent the networking piece and knowing your connections is maybe why King Charles is here in the first place, given that Carney ran the Bank of England. I wonder if King Charles would have maybe come if Polyev had become prime minister. We don't know, it's an alternative universe, but it's interesting to see again those signals, maybe that relationship of already understanding that economy and where we can make those inroads.

Julia Pennella:

I also want to lean into the piece we're going to talk about the cabinet being political rookies. But in Canada, unlike the US, the prime minister often chooses cabinet ministers that are elected officials, and I think it's really interesting. They don't always have to have experience or be experts in that area or file that they've been put in charge of? What kind of challenges, or maybe even unexpected benefits, do you think comes from the way we do it in Canada with structuring our cabinet, and do you think it creates a gap in policy knowledge, or is there more to meet the eye in this situation?

Kelly Baker:

Yeah, I mean certainly there is, I think, going to be a gap in policy knowledge for a number of these folks, especially if they've been put in cabinet positions where they might not have direct expertise.

Kelly Baker:

So, as I said, I think there's definitely going to be a big learning curve for these folks, especially the newly elected ones.

Kelly Baker:

I mean, we have the same Minister of Finance, Minister Champagne, the key economic ministers, actually for the most part, are sort of left over from the Trudeau government. So it kind of makes sense that Carney's put the ministers with some more actual ministerial experience in those sort of key economic roles. But again we've got a number of folks who have not served in government, don't necessarily have that public sector experience United States, where we've seen people like Elon Musk go into some key government roles and we've sort of seen how that's working out, or perhaps not working out, in the United States. So I think it's good at least that we have people who elected by the people. But again they need to remember that at the same time they're accountable to Canadians for the decisions that they make, and that's very different than running a business where you're responsible just for shareholders or customers. That there needs to be a bigger purpose for the reason that you're making the decisions that you're making.

Julia Pennella:

Yeah, and are there any ministers or files this time around that kind of sit out for you that you were, whether it be not expecting to be part of cabinet? There was a shrinking cabinet but I'm curious if there's any new files or ministers that sit out to you.

Kelly Baker:

Yeah, I mean, I think definitely a few, because for even myself and probably yourself and other people, we didn't even recognize the names of the people who were in cabinet because they've just been elected. There's a couple of them that have former experience in government, even as staffers, for instance, but a lot of new faces. So it is interesting when you appoint, for instance, a minister of health who used to serve in the prime minister's office but, from what I can tell, doesn't have any direct health care experience. And, that being said, maybe she was managing health care in the prime minister's office. I'm sure there was a reason for that decision.

Kelly Baker:

And then we've got Evan Solomon, who's a former journalist who's now leading the AI file, which is interesting, which is maybe he has a previous relationship with the prime minister, maybe that's something that he said that he wanted to take on, but as far as I know, he doesn't necessarily have a background in that area. And then there's also the new president of the treasury board. I think used to work in real estate. So that was another like sort of curious choice to me. But again, I don't know what all the these people's backgrounds are and how the decisions were actually made in terms of who was going to get what roles.

Julia Pennella:

Yeah, I totally agree with you. Hopefully also the bureaucracy stacked up to support these rookie cabinet ministers who don't have necessarily that experience on those files. But we have cabinet now and Carney also released his government's mandate letter, but unlike Trudeau, he didn't issue individual mandate letters for each minister. Instead it was more of a general statement outlining the government's priorities and direction. What's your take on that approach? We've heard some critics called it a step back in transparency, but do you think that's fair criticism or is this just a different, maybe more strategic style of leadership?

Kelly Baker:

Yeah, I think it's really interesting and I think it just is showing that he wants to do things quite differently and, as we were talking about earlier, I think it shows that this specific moment in time. It's quite clear that their priorities are trade, the economy, housing, making life more affordable for people, and what I will say. Those were also the key themes of the election. So I would say that it shouldn't come as a huge surprise to people that it's kind of like these are our seven priorities and these are things we want to focus on, because those were the key issues during the election and I think he sees that's why Canadians elected him to deal with the issues that the country is confronting right now and those are kind of the key ones.

Kelly Baker:

That being, and if you're in a portfolio outside of those issues, so if you're the Minister of Health, if you're the Minister of Environment, if you are the Minister of AI, like what does that mean when you have a mandate letter that doesn't like really touch on those key issues at all?

Kelly Baker:

And I think maybe it does raise the question of did they get a different mandate letter or did they get a mandate that was outside of what was on the list of the seven things that they said that they want to focus on, and I think that's not entirely clear. And I think if you're also a stakeholder wanting to approach government on those issues, then you also kind of don't know where to go or what their specific priorities are on those issues. But then again there's also the liberal platform that provides more detail on, like I said, health care and the environment and things like that. So I think it gives some indication of where the government is thinking on those things. It just makes things a little bit more unclear for people who are in the world outside of those specific issues. But I think it's also going to show that getting traction with the government right now on issues that aren't directly relevant to the economy jobs, trade is going to be difficult.

Julia Pennella:

Yeah, well said and it is a reality. And I think that is also one of the biggest challenges with our democracy is the changing of governments every four years, trying to get on track of what's happening, and governments also have to meet their moment. What is happening today? At this very moment, we can look back at the Conservatives having their lead, because the race was very different when Trudeau was in the Trump factor. You know it's all played out since then, but you made a few points there on the party platforms during the election and these are kind of the promises at a high level piece for people who aren't familiar and typically not always. But we'll see some of those policy proposals from an election be translated into a budget. But this year we've heard the federal government said they won't be delivering a spring budget and it raised some eyebrows. What were your initial thoughts on hearing that that we're not getting a budget and from a strategic standpoint, does this make sense politically?

Kelly Baker:

Yeah, and I think it was surprising to a lot of people, I think it's not what they expected, and I think we saw the government backtrack on that very quickly to say, oh well, actually we'll put something out in the fall, probably, I guess, around the time of when the fall economic statement would have normally been released.

Kelly Baker:

And I think that again shows maybe, as we talked about, like the inexperience of this government and a number of people being inexperienced, that they thought that they could avoid putting out a budget and that it was clear that no, there was an expectation that they did need to put out a budget and that it was clear that no, there was an expectation that they did need to put out a budget.

Kelly Baker:

And then the public and stakeholder expectation being that, no, actually we always have a budget every single year, except for, I guess, maybe during COVID. So we expect that there will be a budget release. But I think, again, it just kind of shows that they probably will make maybe some initial mistakes and then the public will sort of react and then they might have to say, oh, maybe we didn't make the right decision there and we do need to release a budget after all. And I will say that I kind of get it in a way, because the budget would have been obviously very rushed and they have again other priorities that they feel like they need to tackle and I think they just felt like it might be a distraction from doing the work that needs to be done, like right now to address trade issues in the relationship with the United States. But regardless, there is an expectation that a budget needs to be released, and so I guess one will be coming sometime in the fall.

Julia Pennella:

Yeah, good point, you're right, Like I think and we saw this with the platforms coming out near the end of the election on all parties fronts is the focus was Trump economic development, growth, all these things. But once it came out, it was pointing out all the deficits and really took the air out of the room of what are we actually trying to focus on. So I understand it, for definitely from especially the way you laid it out from a strategic point and we talked about the different policy areas that we'll see Carney tackle first and hopefully as well with the throne speech today, we'll get some insight on more of the government direction in addition to the mandate letters. The Liberals in a minority government who do you think they might partner with to get things passed in the House? We've already seen the Liberals put forward the middle class tax break. We're going to be seeing, hopefully, some other initiatives that Carney's pushed for a breakdown of internal trade barriers by July 1st. But, yeah, who do you think they're going to partner with this time around to get things done?

Kelly Baker:

around to get things done.

Kelly Baker:

Yeah, and I think, given the situation that they're in, where they're only two seats actually shy of a majority government, is it going to make it really easy for them to get bills passed and they only need to find two other MPs who might be willing to come on side.

Kelly Baker:

So I think there probably aren't going to be major negotiations with the opposition parties because they just don't really need to do that.

Kelly Baker:

I mean, we'll see. But you know, we saw before that the Liberals had to sign a formal deal with the NDP. I don't think that's going to happen this time around, because they only really need two additional votes to get their bills passed. So they might be able to one time make a deal with two members of the NDP or two members of the, the Bloc Québécois, or even, you know, get Elizabeth May on side. So I think it probably won't to be that challenging because they kind of have like a you know, major minority which will allow them again to like very easily, I think, to get government work done. I don't know that it's going to be that easy for them to work with the Conservatives. We'll see, you know, maybe they can get one or two conservatives on side, on, like you said, things like middle class tax cuts, like things that the conservatives said that they also wanted to do, then you know, they may very well be able to do that.

Julia Pennella:

Yeah, I saw this meme online where it was like a cartoon of Pierre Polyev and there's two arrows. One of them's going right, saying the government's going in the wrong direction. The other one's going left, saying take our policy ideas. So it should be interesting to see how the conservatives balance keeping the government accountable as official opposition, but also if they start doing more tax cuts and similar policies they might have put forward if they're going to be voting on them. So it's going to be really interesting to see if the ideological is going to overbear what their core of what their values are. Let's just say I use values loosely too, because I think there's some challenges within all the parties, but more so especially with the Conservatives, of what that means for them.

Julia Pennella:

Shifting gears a little bit. I want to talk about the Ontario budget that also came out, but also the impacts of not having a federal budget, as we just talked about. So in your LinkedIn analysis on the Ontario budget and I'll be sure to add that in the keynotes you pointed out that without a federal budget, provinces and municipalities are left in a tough spot, especially since they rely heavily on federal funding for infrastructure, health care, housing and homelessness, which is also a really big issue in urban centers. Can you unpack that a little bit more for our listeners, because I think a lot of people feel frustrated when they see a lack of progress in areas like provincial health care or education. It often feels like from if you're not in the Ottawa bubble or understanding of the way jurisdictions work. There's a lot of political finger pointing going on. So, again for our listeners, can you explain why the absence of a federal budget actually matters so much at that provincial level and how it affects provincial government's ability to plan and deliver services?

Kelly Baker:

Yeah, and I think you kind of just explained it right there actually that it does inhibit their ability to plan and deliver services, especially over a longer period of time, because they would have had commitments from the Trudeau government but again, this is a new government, we don't know if those commitments still stand. And the reality is that, like you said, both provinces and municipalities do rely on federal funding to deliver some of their core services, like health care. The provinces get billions of dollars every year in health care transfers, which again helps to fund, you know, like hospitals, and they help to recruit doctors and nurses and things that are very much needed within the health care system right now. So if they're not able to plan accordingly, then they're kind of guessing, and that makes it difficult for the provinces to achieve a balanced budget as well when they just don't know how much revenue they're getting. And we're talking about billions of dollars here.

Kelly Baker:

These aren't small amounts of money and it's the same with the municipalities, and I've done some work with some municipal organizations in the past and they've consistently talked about the fact that how difficult it is to do long-term planning when they don't have consistent funding for things like infrastructure, to support housing, and they feel like they're always kind of trying to beg other levels of government for money to support these things, even though all levels of government say that things like housing and affordable housing should be priorities.

Kelly Baker:

But municipalities collect the lowest amount of tax dollars of any level of government, so they're very reliant on both provincial and federal funding to sort of fill that gap and federal funding to sort of fill that gap. And when they don't know how much they're going to get year over year, then it really inhibits their ability to do long-term planning because they just don't have the sustainable funding to support that, because you could have funding one year and then not have funding the next, and so that's very problematic for them in terms of trying to move housing forward. Tackle things like homelessness, which has become a big issue for municipalities all across Ontario. Also, now some rural municipalities are seeing encampments pop up and so this is a big issue of concern, and I know that they feel like they don't have enough funding from other levels of government to address these issues and so, without a budget, they're kind of left in the dark, wondering how much funding they're going to have to support these types of programs.

Julia Pennella:

Yeah, that was a great analysis. I appreciate it and it's so unfortunate as well because when you look at the amount of services municipalities offer to our day-to-day lives, like I think people forget federal is very big picture but there's obviously with the taxation system running that and trickling down those funds. It's a huge barrier and I don't think a lot of people are aware of. When we look at how many people actually show up for municipal elections, is the voter turnout so low versus the federal government? We just saw some historic turnouts. I'm curious from your experience working with a lot of stakeholders why do you think there's that disconnect from the public of understanding where funding goes towards certain services and the different jurisdictions of our different levels of government? I know it's a bit of a big question of asking for advocacy one-on-one, but I'm curious if you can maybe help break that down or if you've seen any patterns working with your clients about this disconnect of understanding who oversees what?

Kelly Baker:

Yeah, and I think, unless you're living and breathing government day in day out, most people really don't understand what levels of government deliver what, and people often get confused about who delivers what I mean at the end of the day.

Kelly Baker:

Technically, the province is responsible for delivering health care but, as I said, they rely on federal funding to actually like fund day to day health care.

Kelly Baker:

And now municipalities are increasingly having to deliver more health care through public health and like during the pandemic and things like that.

Kelly Baker:

So it's interesting that sometimes the line isn't always even clear in terms of what level of government actually does deliver health care or what level of government should be responsible for delivering different social services.

Kelly Baker:

So I think that makes things also confusing for the electorate in terms of, like I said, at the end of the day, who was responsible for what, and municipalities do touch more of the things that like impact people's day-to-day lives. I think it's clear to people that like yeah, it's a city that comes and picks up my garbage or it's a city that clears the roads, but what they may not be totally aware of is the fact that it's also the city that's responsible for housing, to a certain extent, homelessness, some a little bit of health care, and then there's some overlap with, like education, with the school boards. So you could actually argue that like what aren't municipalities responsible for these days? So again it makes it even more important that the municipalities have the funding also that they need to deliver those essential services, or else it's really going to leave people in a tough position if they can't access sort of those essential services.

Julia Pennella:

And that's a wrap on this episode, but don't go too far. Kelly will be back with us for another episode, as we dive into the Ontario budget. She breaks down what the government got right, what they left out and the real-world consequences of underfunding public services like education and health care. We also explore how the government relations space has changed over the years and what inspired Kelly to launch her own firm. There's still so much to unpack and more political drama. You won't want to miss it. I'm your host, Julia Piniella, and this is let's Talk Politics. Catch you on the next episode.