Budget 2026: Running Faster Just to Stand Still

SUDBURY, ON in Robinson Huron Waawiindamaagewin Treaty Territory (September 28, 2026)

Canada’s Budget 2026 is titled “Masters of Our Destiny”. Citizens’ Climate Lobby Canada (CCL Canada) welcomes Budget 2026’s investments in electrification, home heating and energy efficiency. These are important steps toward reducing greenhouse gas emissions, lowering household energy bills and building a more resilient Canadian economy.

But Canada faces a fundamental problem: we are running faster without making enough progress.

In Lewis Carroll’s Through the Looking-Glass, the Red Queen must run faster and faster just to stay in the same place. Canada risks finding itself in the same predicament. We announce new climate initiatives, but the distance between our actions and what the climate science demands continues to grow.

The United Nations Environment Programme’s 2026 Emissions Gap Report warns that even if countries fully implement their current climate commitments, the world remains on a trajectory toward approximately 2.6°C of warming this century. The report makes clear that much deeper and faster emissions reductions are needed.

The 2026 Lancet Countdown on Health and Climate Change finds that the health impacts of climate change are accelerating faster than climate action. Climate change is not simply an environmental issue. It is a growing threat to human health, food security, livelihoods and economic stability.

And the independent Climate Action Tracker assessment of Canada rates Canada’s overall climate action as Highly Insufficient, with its current policies and actions rated Critically Insufficient. Canada’s projected emissions reductions are nowhere near what is needed to meet its climate commitments.

We applaud the electrification investments, but the transition must also be affordable and fair.

Budget 2026 commits $2 billion over eight years to support one million home retrofits, including heat pumps for up to 820,000 households between 2026-2034. Once fully implemented, these investments are expected to save Canadian families more than $1 billion annually in energy costs and reduce emissions by over 25 megatonnes. This is precisely the kind of investment that can make climate action tangible in people’s everyday lives.

The increase to the Canada Groceries and Essentials Benefit is also a start. The new 2027 supplement brings the combined benefit for a couple with two children to as much as $2,570 in 2026–27. For families struggling with the cost of food and essentials, this assistance matters. But a temporary increase is not a substitute for addressing the structural causes of poverty and record levels of income inequality.

On November 3, the government’s National Advisory Council on Poverty released its 2026 annual report, Too Many Left Behind. It reports that 4.5 million Canadians, or 11% of the population, were living below Canada’s official poverty line in 2024. The Council warns that progress has stalled, relative low income is increasing, and current poverty reduction measures will not be sufficient to meet Canada’s 2030 poverty reduction target.

When low- and middle-income Canadians are struggling to afford groceries, housing, transportation and energy, they have fewer resources to invest in energy-efficient homes, electric vehicles and other climate solutions. Meanwhile, climate-related disasters, fossil fuel price volatility and geopolitical conflict threaten to deepen inflationary pressures.

Canadians cannot become masters and mistresses of their destiny if they are continually struggling to afford the present, let alone prepare for the future.

CCL Canada believes Budget 2026 needed to go further. Four policy measures are particularly important:

• Climate-aligned finance rules: Ensure that public and private financial institutions direct investment toward a net-zero economy rather than financing new fossil fuel dependency and locking in decades of additional emissions.
• Stronger industrial carbon pricing: Restore a credible, predictable and increasingly stringent price signal that rewards industrial innovation and emissions reductions, rather than weakening the incentive for major polluters to clean up their operations.
• Wealth taxes: Address Canada’s extreme concentration of wealth and ensure that those with the greatest financial capacity contribute fairly to the investments needed for a climate-safe and equitable society.
• Excess-profit taxes on fossil fuel companies: Ensure that extraordinary profits generated by the fossil fuel industry during the global conflicts help pay for climate solutions and provide economic relief to Canadians facing rising living costs.

The revenues from these measures should help finance climate solutions, accelerate electrification, support affordable housing and home retrofits, and strengthen economic security for low- and middle-income households.

Budget 2026 has taken some important steps. CCL Canada applauds those investments and urges the federal government to match them with the policy ambition and economic fairness that the climate emergency demands.

We can and must build a Canada where everyone has the opportunity, security and resources to be masters and mistresses of their destiny.

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About Citizens’ Climate Lobby Canada
Citizens’ Climate Lobby Canada is a non-partisan, volunteer-based organization working to build the political will for effective climate action. Through respectful, constructive engagement with elected representatives, businesses and communities, CCL Canada advocates for evidence-based policies that reduce greenhouse gas emissions while strengthening Canada’s economy and improving people’s lives.

Media contact:
Citizens’ Climate Lobby Canada
Cathy Orlando, National Director,
Citizens’ Climate Lobby Canada cathy@citizensclimate.org | 705-929-4043