Capital Dispatch: PM Carney under pressure to keep promises

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Industry pressure on Liberals to deliver, PM Mark Carney names a new viceregal

This week was really about how industries are faring, a year into Prime Minister Mark Carney’s time in power. His promises to tackle the Canada-U.S. trade war, and support struggling sectors while building up others, was centre stage, though it didn’t take a spotlight to see the discrepancies.

Plus, Canada is getting a new governor general.

The week that was

At a time where a commitment to the rule of law is among the values Carney wants to project to the world, he’s decided to name highly acclaimed longtime jurist Louise Arbour to be Canada’s next governor general.

“It’s a duty that calls for sound judgment,” Carney said during the announcement of Arbour’s recommendation at the National Art Gallery in Ottawa Tuesday. “That is the office, and it is the office to which I have asked His Majesty to appoint a Canadian whose entire life has been dedicated to that very principle.”

Governors general are appointed by the monarch at the recommendation of the prime minister.

Carney confirmed Tuesday that King Charles III has approved Arbour’s appointment.

Arbour is a former Supreme Court of Canada justice, and has also served as UN High Commissioner for Human Rights and chief prosecutor of the International Criminal Tribunals for Rwanda and the former Yugoslavia. Referencing those latter roles, Carney said Arbour “inherited two institutions that many believed could not succeed,” but added: “She made them succeed.”

The official changeover will happen in a month, Canadian Heritage later confirmed.

“As Mary Simon has, Louise Arbour will represent the best of Canada to Canadians and to the world,” Carney said.

On the industry front, the week started with the federal government announcing the launch of a new $1-billion loan program for steel, aluminum and copper businesses impacted by U.S. President Donald Trump’s tariffs.

Industry Minister Mélanie Joly and minister responsible for the Federal Economic Development Agency for Southern Ontario Evan Solomon made the announcement in Vars, Ont. on Monday morning.

As colleague Stephanie Ha reports, the program will be created under the Business Development Bank of Canada and will provide “financing at favourable terms” to help businesses “address immediate pressures” and “adapt to future market conditions.”

The funding was not part of last week’s spring economic update. Asked by reporters if she thinks Trump’s tariffs will be in place “forever,” Joly said “I don’t know.”

It’s exactly that tariff uncertainty that appears to be eating away at international investors’ confidence in the Canadian auto sector. Just one day after Joly stated this, the news emerged that Honda was likely pulling the plug entirely on its plans to build a $15-billion EV plant in Ontario.

On Tuesday, Nikkei Asia reported that slow U.S. demand is pushing the Japanese automaker “to put hybrids at the centre of its North American strategy.”

Federal officials and auto sector representatives were quick to point to the global shift in the electric vehicle market and sales interest south of the border as more of a contributing factor to this move than Trump’s tariffs. Though Carney, without mentioning Honda specifically seemed to see things a bit differently.

“There are challenges with the U.S. tariffs, unjustified tariffs in the auto sector,” Carney said to reporters on Wednesday morning in Ottawa. “We’ll continue to work with companies in the sector, helping them reposition, reinvest, supporting workers there. We’ll continue to do what’s necessary, including getting the right deal in Canada’s interest.”

It was a better week for the Quebec aerospace sector. Airbus revealed that international airline AirAsia has purchased 150 A220 commercial aircraft from Airbus to be manufactured at a plant in Quebec that employs thousands of Canadian workers.

And Carney was all too happy to try to take some credit, or at least hint he played a role in this commercial deal. Speaking at the announcement, he referenced a conversation he had last October in Kuala Lumpur with Tony Fernandes, the entrepreneur behind AirAsia.

“Tony, thank you for placing your trust in Canadian workers and industry — you are choosing the best, at the right time,” Carney said.

On the energy and major projects front an admission that the policy changes the prime minister has already made, won’t be enough to deliver on his commitment to see project approvals sped up… at least not in all cases.

And so, Carney’s government intends to table legislation soon that would expedite the regulatory approval process for all big energy and infrastructure projects.

The intention of the coming legislation is to reduce the regulatory decision and approval process for these major development proposals down to two years, a commitment previously made by the federal Liberals.

These reforms are expected to apply more widely than the existing major projects law Carney passed just under a year ago. That legislation, Bill C-5, enabled the government to fast-track approvals for projects deemed to be in the national interest.

Government House Leader Steven MacKinnon said he didn’t think it should come as any surprise.

“We have a lot of work to do to continue progress on reforming a regulatory process, make sure everyone is heard but also make sure they go faster,” he said. “I don’t think that’s a secret.”

Conservative Leader Pierre Poilievre – who has long called on Carney to repeal existing rules that stakeholders have said hinder development – regaled the crowd at the Canada Strong and Free Network conference about how the need to legislate more makes the prime minister’s pledge to build at speeds not seen in generations little more than an illusion.

Though, Alberta welcomed it. Of course, this news emerged the day before Alberta Premier Danielle Smith came to town and met with Carney, as their provincial-federal push to make progress on their pipeline memorandum of understanding (MOU) continues.

We’ve had some really constructive conversations over the last number of months... still have a few things to work out, and I hope that we can get to the finish line... I know industry is getting a bit impatient. Albertans are getting a little bit impatient, and if we’re going to move forward with that MOU, I hope it happens in the next number of days," Smith said.

Not to be missed

Carney facing decision on MAID expansion

Carney says he isn’t in any rush to make a decision on access to medical assistance in dying for people whose sole condition is mental illness. His comments come after reports the federal government is prepared to table legislation to pause the expansion based on committee recommendation. Eligible Canadians have had access to MAID since 2016, with amendments made to the criteria in 2021. Further expansion of MAID to include mental illness as the sole factor, however, has been highly controversial, and in 2024, the federal government under former prime minister Justin Trudeau announced it was delaying the move until 2027. A special joint parliamentary committee has since taken up the work of studying the issue, hearing from more than three dozen witnesses in the last year, with recommendations due before the expansion comes into effect next year. “I’m waiting to see the report of the inter-parliamentary committee,” Carney told reporters on Parliament Hill Wednesday. “I haven’t actually seen anything on it. I haven’t received any briefings specifically on it, and we’ll get it when we get it.” Several cabinet members and MPs across the aisle also commented on the issue on their way into and out of caucus meetings Wednesday, colleague Spencer Van Dyk reports.

OpenAI breached Canadian privacy laws with ChatGPT

OpenAI failed to respect Canadian privacy laws when training its artificial intelligence-powered ChatGPT chatbot, federal and provincial watchdogs have found. As The Canadian Press reports, the conclusion came Wednesday in a report on a joint investigation by federal privacy commissioner Philippe Dufresne and his British Columbia, Alberta and Quebec counterparts. The report found the way OpenAI collected information to train its models was overly broad, resulting in the compilation and use of sensitive personal details. They said this could include data about individuals’ health conditions and political views, as well as information concerning children. Asked to comment on these findings, Artificial Intelligence and Digital Innovation Minister Evan Solomon said Thursday that “we expect every single social media company to protect Canadians’ identities, their privacy, and their data, and we’ll be coming forward with a change to the framework to make sure that happens… very soon.”

So long iconic Air Force Snowbirds?

And, the summer of 2026 could be Canadians’ last chance to see the Royal Canadian Air Force’s iconic Snowbirds aerobatic team for years, the Conservatives warned this week. Their concern that the federal government is preparing to pause or cancel the Snowbirds program in 2027, comes as the Liberals have spent tens of millions of dollars in recent years to keep the aging aircraft flying into the next decade. As Ottawa Bureau Chief Graham Richardson reports, Defence Minister David McGuinty did not provide a direct response to the Conservatives’ warning. “Snowbirds will continue air demonstrations with the Tutor fleet for as long as it is feasible and safe,” McGuinty said in the House of Commons, later adding that the federal government is “beginning the process of examining potential aircraft options,” once the fleet “reaches its ends of life.” The minister will be in Moose Jaw, Sask. on May 19 to “provide updates on the future of the Canadian Forces Snowbirds.”

Quote of the week

The week ahead

MPs will be back in their ridings for the next two weeks, returning to Ottawa for the final at-most four-week stretch of sitting before the summer.

How many more bills will the majority Liberals pass before adjourning?

The government has already given warning that they intend to use closure – a tool to limit how many more hours of debate will be permitted on a piece of legislation before it’s put to a vote – “more often.”

Covering the latest political news from CTV’s parliamentary bureau in Ottawa, Rachel Aiello offers exclusive analysis on political developments straight from Ottawa.