Ottawa / Traditional, Unceded Territory of the Algonquin Anishinaabeg People, November 4, 2025 – At a time when climate impacts are accelerating, devastating health, the healthcare system and livelihoods of people across Canada (with $9.2 billion in insured losses in 2024), Budget 2025 acknowledges these impacts but under-invests in real solutions. In response to the federal budget measure announced today by Prime Minister Carney, president of the Canadian Association of Physicians for the Environment (CAPE), Dr. Melissa Lem, said:
“By directing public funds towards fossil fuel projects without fully accounting for their health and climate impacts, the government is putting the wellbeing of people in Canada at risk. Ignoring these risks means disregarding both the science and the human consequences, including worsening respiratory illness, heat-related deaths, and land, water and air contamination. We are also deeply concerned that the proposed oil and gas emissions cap is slated for elimination and that toxic pollutant management received no attention in this budget.”
“We must reiterate what we outlined with the Green Budget Coalition last week: investing in a clean electricity grid, climate-resilient housing, nature protection, and protection from toxic chemicals isn’t just good environmental policy; it’s good health policy. Every dollar we invest in preventing pollution and climate damage today pays dividends in healthier families and lower health-care costs tomorrow,” she added.
CAPE’s Analysis of the budget follows here:
On the Climate front
While CAPE applauds new policy direction on pollution pricing and enhanced methane regulations, the announced Climate Competitiveness Strategy falls short of that ambition. It introduces new tax credits for LNG and modestly expands Investment Tax Credits (ITCs) for carbon capture and storage (CCS), allowing companies to write off a portion of their project costs. CAPE is concerned that the government is reaffirming support for major LNG and carbon capture and storage (CCS) projects, effectively backing five existing and future fossil fuel developments.
Climate adaptation investments outlined in the budget also miss the mark. CAPE was pleased to see support for a number of commitments, including a $6 billion funding stream earmarked for adaptation and retrofits, among other items. We are eager to see more detail here. However, the budget failed to deliver on longstanding requests for surge funding to the Disaster Mitigation and Adaptation Fund, as well as research into the links between climate change, severe weather events and health outcomes.
Similarly, the government lists potential initiatives such as grid interconnections, low-carbon fuels, renewable energy, high-speed rail, and critical mineral development; it remains unclear how these statements of intent will translate into concrete action or funding.
On Toxics and Chemicals Management
Despite overwhelming medical evidence linking fossil fuel pollution and other toxic chemicals to serious health impacts, the government ignored calls to strengthen toxics management and pesticide oversight. Chemical pollution has crossed a planetary health boundary, and chemical production projections suggest a tripling of chemical production between 2010 to 2050. And yet, the Chemical Management Plan (CMP) and Office of Environmental Justice were left out entirely, and oversight on pesticides is being weakened, which sends a troubling signal for environmental health protection in Canada.
On Clean Electricity and Regulations
On the clean electricity front, in September CAPE urged the government to invest in a coast-to-coast clean electricity grid to strengthen Canada’s climate competitiveness. Yet the budget merely reiterates existing Investment Tax Credits (ITCs) for clean energy projects, without any new commitments or funding for the grid itself.
On the regulatory front, CAPE welcomes the government’s stated commitment to strengthen methane regulations, an important and long-overdue step. Meanwhile, the decision to eliminate the proposed oil and gas emissions cap represents a significant setback for Canada’s climate commitments. Treating emissions caps as “extra” policy rather than essential climate action with direct health implications is deeply concerning. Similarly, on industrial carbon pricing, no new financial measures were introduced. While the budget outlines some broad and useful policy direction on industrial carbon pricing, it lacks clarity on implementation.
On Environmental Disinformation
Finally, in the same logic, CAPE is disappointed to learn that the federal government intends to do away with the greenwashing amendments in the Competition Act. The greenwashing amendments have been applauded both domestically and internationally for protecting consumers’ rights and ensuring truth in advertising. A 2024 Angus-Reid commissioned poll found that 93% of the public support the amendments. Canada needs to do more, not less on greenwashing. Ensuring climate competitiveness means ensuring polluters cannot get away with deceiving the public about how their products harm our health and our environment. If the government wants to spur innovation, it needs to guarantee genuinely green businesses can compete on an equal playing field.
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Media contact:
Loujain Kurdi
Communications Manager | Canadian Association of Physicians for the Environment
647-762-9168
media@cape.ca