Prime Minister Mark Carney Officially Calls an Election Amid U.S. Trade War 

Prime Minister Carney visited Governor General Mary Simon at Rideau Hall just nine days after being sworn in and two weeks after his landslide victory in the Liberal leadership contest. He asked her to dissolve Parliament and call an election for April 28, 2025 - the shortest election period allowed under Canada’s Elections Act. 

Before Prime Minister Carney’s Liberal leadership win, most major polls were predicting a Conservative majority government. Now, the Liberals are heading into the election with a much stronger position than when Carney commenced his leadership campaign in mid-January. Polls now show that this is a highly competitive race giving both parties a real chance to secure Canadians’ votes. 

In addition to their general campaigns, over the next month, each political party will also have to navigate U.S. President Donald Trump’s ongoing tariff threats and comments on Canadian sovereignty. With new U.S. tariffs set to be implemented on April 2, these issues will add another layer of complexity to the election campaign. 

Campaign Kickoffs 

Parties have been in campaign mode for months in anticipation of an early election, but the official call accelerates their messaging and mobilization as the leaders compete to define themselves as the best person to navigate President Trump’s unpredictability.

Prime Minister Mark Carney said he needs a strong, “positive mandate” from Canadians to lead the country successfully through the battle against Trump’s trade war and annexation threats. Carney outlined his first promise to cut the marginal tax rate for the lowest bracket by one percentage point, claiming it would benefit a dual-income family by up to $825 a year. Shortly after his visit to Rideau Hall, Carney attended a rally in St. John’s, Newfoundland, to kick-start his campaign. 

Earlier, he said a Liberal government would prioritize building new domestic trade routes for energy and critical minerals, and add new supports for farmers and businesses affected by the trade war.

Carney also announced that he will run in the riding of Nepean, a few days after the Liberal Party ousted MP Chandra Arya as its candidate. His choice is being questioned, as the party has not revealed why Arya was dismissed as a candidate. Carney said it was a decision that was up to the green-light committee that screens candidates, and that he knows the Ottawa area well as a resident of nearly 20 years.

Conservative Leader Pierre Poilievre officially began his election campaign in Gatineau before heading to the Greater Toronto Area. His key messaging hinges on pitching himself as the leader representing change after nearly a decade of Liberal government. 

Poilievre has changed his previous messaging as a resurgence of Canadian pride emerged in response to repeated threats of annexation by the Trump administration. The Conservative leader has decreased emphasis on the notion that Canada is broken, and adopted a more optimistic stance, pledging to restore Canada's potential. 

In his kickoff speech, Poilievre committed to cutting taxes, increasing natural resource production, and creating jobs to make Canada more independent and sovereign - which he said is “bad news” for President Trump. 

NDP’s Jagmeet Singh kicked off his campaign in Montreal, where he focused on the NDP’s strength as a party. The NDP has recently been projected to potentially lose official party status in this election. The party is expected to emphasize recapturing the support of voters who polls suggest are turning to the Liberals in the face of threats to Canada from Trump. 

In his speech, Singh tried to bring the focus back to Canadians, claiming that while other leaders may be focused on who can stand up to President Trump, he will remain focused on who can stand up for Canadians. 

What to Watch over the Next Month

• Polling Shifts: With such a reduction in the CPCs polling lead, pollsters emphasize that this is both a horserace between the CPC and LPC - and that the vote is soft. It’s any party's election to win. 

• Battle of Ottawa: Poilievre and Carney are set to run in adjacent ridings - Carleton and Nepean, respectively - adding an extra layer of interest in their local campaigns.  

• Provincial Relations: There has already been keen interest in the stance of provincial and territorial Premiers on this election, with both Premiers Ford and Smith making headlines. With a “Team Canada” mantra taking hold, the influence and impact Premiers have on this election could be significant - but for what party it is unclear. 

• What about health care? With the LPC move to expand dental care on the eve of the election, expect some popular topics - that are particularly important for NDP voters - to be a re-occurring theme this campaign. 

• Untested campaigners: While CPC Leader Pollievre has had several years at the helm touring the country, this is the first campaign for both the CPC and LPC leaders. How they perform, and how many mistakes they make, may be a determining factor of this campaign. All eyes are on Mark Carney who is only a few weeks onto the job and considerably untested in the electoral arena. 

Context

On March 9, 2025, Mark Carney was announced as the new leader of the Liberal Party of Canada with a landslide victory of 85.9% of the votes. Chrystia Freeland came in second place, with 9% of the votes, followed by Karina Gould and Frank Baylis.

What’s Next

Transition of Power: A date has yet to be set for Prime Minister Justin Trudeau to transfer his power officially. Prime Minister Trudeau has said he will keep his role for a few days or weeks to help with the transition but will step down once Carney is officially sworn in. 

Carney, currently considered the Prime Minister-designate, met with Trudeau on Monday to discuss the transition. Once the date for a transfer of power is set by Carney, Prime Minister Trudeau will have to meet with the Governor General, tender his resignation and ask her to invite the new Liberal leader to form government. It is anticipated that this meeting could happen as early as Tuesday, March 11. Following Carney’s swearing-in, he is expected to name a new, leaner Cabinet that will take him into the next federal election. 

Carney has also been working to staff up his office as quickly as possible, with Marco Mendicino, a former Trudeau Minister, already confirmed to be interim Chief of Staff.

Federal Election: Carney is not currently an elected Member of Parliament (MP) and does not have a seat in the House of Commons. Along with the significant shift in the polls in favour of the Liberals over the last two months, there is speculation that a new Cabinet will be sworn in on March 13 or March 14, and an election called before parliament is scheduled to resume on March 24.

As per the Elections Act, the election or campaign period – the “writ” –  must be at least 37 days and no more than 51 days. Election day must also fall on a Monday except in rare circumstances, meaning that an election is typically called on a Sunday. Provided he swears in his new Cabinet this week, Carney could seek to go to the polls as soon as Sunday, March 16 with an election day as early as April 21. Given Easter weekend, however, it is more likely that he would seek to set election day the following week, on April 28.

Victory Speech Policy Highlights

Mark Carney outlined a range of issues in his victory speech at the Liberal convention this weekend, particularly highlighting the Trump/United States dynamic, taking on the Conservatives in the upcoming election, and the need to invest in Canada: 

• United States: Carney accused President Trump of trying to weaken the Canadian economy. He commended the work done by Prime Minister Trudeau and his government to instate retaliatory tariffs and economic supports for those impacted, implying he would continue this level of response to any ongoing tariff war.  

• Conservative Party of Canada (CPC): Carney also drew parallels between President Trump and Conservative leader Pierre Poilievre, calling out the leader for his lack of experience outside of politics and his refusal to get security clearance.  

• Investing in the Canadian economy: It is clear that Carney’s plan will be keenly focused on investing in Canada’s own economy and growing our ability to deliver within our own borders. He indicated a clear intention to work with the provinces and territories and focus on fostering one Canadian economy, as opposed to the divided, piecemeal economy that’s built up throughout the 13 jurisdictions.  

• Health: Carney highlighted the importance of a publicly funded health care system while comparing Canada to the United States. He also made clear that he will continue to fight for dental care and pharmacare for those who need it. 

Status of Liberal Nominations

Mark Carney will need to strike a balance between creating a cabinet with incumbents who are likely to win their ridings, and a turnover of Ministers in safe Liberal ridings to renew the Liberal cabinet. He may also choose to retain Ministers of key files related to ongoing tariff negotiations with U.S. President Donald Trump. 

• Christya Freeland has not confirmed since the leadership race concluded whether she will run in the upcoming election. Early in the leadership race, her campaign team assured potential voters that she would run again even if she did not come out on top, but it is unclear if that will hold true after such a significant loss.

• Karina Gould, who stepped down from her role as Liberal House leader to take a run at the party’s top job, said she plans to run again in the next federal election. She placed third in the leadership race, with 3.2% of the vote. 

• Frank Baylis, chairman of a medical technology company and former MP, came in last place of the leadership race with 3%  of the vote. He has indicated that he is happy to support Carney in whatever capacity he thinks is best. 

• Marci Ien, Minister for Women and Gender Equality and Youth, announced that she will not run in the next election, freeing up the Toronto Centre riding which she has represented since 2020. 

See here for a list of MPs not running in the next election. 

Santis Insights

• Dramatic polling reversal: Recent polling has made clear that the CPC may not walk into victory as easily as they may have two months ago. While CPC is still leading on many metrics, there has been a notable trend towards increased support for the Liberal Party of Canada (LPC) , especially on the metric of who best should lead Canada against Trump’s economic threats. It will soon be established if this polling trend will continue.  

• Economic credibility: While the CPC is traditionally considered to be the favourite on matters related to the economy, having Carney, an economist and former Governor of the Bank of Canada, as the leader of the LPC presents a challenge for the CPC to overcome.  

• CPC focus on Trudeau & the Carbon Tax: The change in leadership is also pushing the CPC to rethink their strategy on key wedge issues and attack ads. After spending significant time and resources on anti-Trudeau and anti-carbon pricing messaging, a new leader with a new stance on the future of carbon pricing has meant that the CPC has to adjust their focus – something that has so far proven difficult. Currently, the CPC has invested in new advertisements to establish Mark Carney as being associated with both Justin Trudeau and the carbon tax.  

• What issues will stick with the population? Political parties will seek to define themselves before the opposition does that for them. There are two dynamics that will be important to monitor (1) what attacks and issues will stick with the Canadian population based on the respective narratives coming from both the CPC and LPC, and (2) if there is a turning point that attack ads become a liability for the political party launching them. 

With Mark Carney taking over as leader of the LPC, all eyes will be on both the shift in policy priorities of the Party and on the CPC as they rework their strategy to try and reverse recent polling trends. 

Prime Minister Justin Trudeau’s Resignation and Parliamentary Updates

On January 8, 2025,  the Prime Minister officially announced his long-awaited intention to resign as Liberal Party leader as soon as the party chooses a new leader. He will also be stepping down from his role as Member of Parliament following the election. 

Prime Minister Trudeau cited internal battles as the reason for his decision, referring to the increased pressure from MPs within the party calling on his resignation, and the recent resignation of former Minister of Finance Chrystia Freeland. There have been considerable changes in the Party over the past few months, as prominent ministers have resigned, and many MPs announced their intention to not run again. 

Governor General Mary Simon granted the Prime Minister’s request to prorogue Parliament until March 24, 2025. During prorogation, the Prime Minister retains his role as head of government and the Liberal Party, and cabinet ministers and civil servants, continue to operate as usual. However, parliamentary committees are suspended, and any legislation in progress will have to be reintroduced once Parliament resumes. Confidence votes can not be introduced until the session reconvenes.

Liberal Party Leadership 

The party will announce the new leader on March 9 and is set to hold a minimum of two leadership debates — one in English, and one in French. The dates are yet to be determined. 

The Liberal Party approved of the following six contenders for the next leader, including: 

• Mark Carney (Former governor of the Bank of Canada) 

• Chrystia Freeland (MP and former Minister of Finance) 

• Karina Gould (MP and former Leader of the Government in the House of Commons) 

• Jaime Battiste (MP) 

• Frank Baylis (Former MP)

• Ruby Dhalla (Former MP)

As of January 27, the two frontrunners of the leadership race are Mark Carney and Chrystia Freeland. Carney's campaign has been gaining traction, securing the support of prominent cabinet ministers. He has been endorsed by 57 Liberal MPs, including 18 cabinet ministers, compared to Freeland’s 25 supporters in caucus, including five ministers, and 2 MPs supporting Gould.

Following the deadline to sign up for the leadership role, MP Chandra Arya shared he was informed by the Liberal Party that he would not be permitted to take part in the leadership race, sparking controversy over the lack of explanation for the decision. 

Election Preparedness

As of January 28, each party has the following number of candidates, none of which are near the full slate of 343 candidates. 

• Conservative: 225

• Liberal: 135

• NDP: 106 

• Green: 75 

• Bloc Québécois: 2 

As each political party eagerly prepares for an election, the issues of affordability and preparing for US President Trump’s tariff threat are top of mind. The Conservative Party, under leader Pierre Poilievre, has been gaining strong momentum, particularly on issues of affordability, and preparing for US President Trump’s tariff threat. 

Jagmeet Singh, leader of the NDP initially promised that his caucus will vote the Liberal government down as soon as Parliament resumes. However, on January 28, 2025, Singh indicated he is open to working with the Liberal government to pass relief measures for workers if U.S. President Donald Trump moves ahead with tariffs on Canadian goods. Although his commitment to voting the government down still stands, he is willing to collaborate with the Liberal Party to pass a solution for the impending crisis.  

In recent weeks, polls have indicated the possibility that the Bloc Quebecois can become the official opposition party, as several polling projections have shown the Liberals trailing the Bloc in overall seat count. Yves-François Blanchet indicated he does not support the NDP’s recent openness to work with the Liberal Party, and remains eager to call the election. 

Outstanding Legislation

As the prorogation period continues, the Liberal government’s dental and pharmacare programs face uncertainty. Currently, two-thirds of Canadians set to be covered under the new national dental insurance program are still not eligible. The government has also only signed a deal with PEI to pay for contraceptive and diabetes medications under the pharmacare program. 

Federal Health Minister Mark Holland said that nothing is guaranteed, but he remains confident in implementing these programs. His office says the government is looking forward to signing agreements soon. The NDP declared they will not give the Liberal Party more time to implement the programs, whereas the Conservative Party have not indicated whether they would keep, change or cancel the programs if they win the next election.

What’s Next? 

Once a new Liberal Party leader is elected he or she has the option to dissolve Parliament and send Canada immediately into a federal election campaign.  If the leader elects not to dissolve Parliament, it will reconvene March 24th, and the government must deliver a Speech from the Throne to outline its agenda, followed by a confidence vote.  The other confidence vote will come by the end of March when Parliament must pass the main estimates, the funds required for the operation of the federal government.

Unless one of the Opposition parties re-considers its position to vote non-confidence in the government, the Liberal government will fall on one of those confidence votes but it is equally probable that the new Liberal leader will choose to call an immediate election once selected on March 9th.

In a historical moment, on January 6, 2025, Prime Minister Justin Trudeau announced that he will resign as Liberal Party leader and Prime Minister of Canada pending the selection of a new leader by the party.

He has asked Governor General Mary Simon to prorogue Parliament until March 24 in order for the Liberal Party to hold a leadership convention where a new leader can be chosen. The Governor General has granted his request.

What to Expect Next

• The Prime Minister will meet with the national Liberal caucus on Wednesday for a lengthy meeting to discuss how the government will function over the coming months.

• The National Director of the Liberal Party has stated he will be meeting with the entire Board of Directors this week to determine the path forward.

• In addition to the rules for the leadership contest, the Board has the power to appoint an interim party leader, but they are unlikely to do so given that the Prime Minister has said he is prepared to remain as interim leader until a new party leader is elected.

• Liberal Members of Parliament will also reportedly be briefed this week on the party’s rules that govern leadership races, and the caucus’ role in leadership issues.

• Leadership candidates, some of whom have already been organizing for a leadership race, will kick their campaigns into high gear and we expect public declarations of interest to be shared as early as this week.  Front runners are widely thought to be Mark Carney, Minister Champagne, Cristy Clark, Chrystia Freeland, Minister Joly and Minister LeBlanc.

• It is important to note that if a current Cabinet Minister declares their intention to run for leader, they must step down as Cabinet Minister, which would then necessitate another cabinet shuffle.

What Does This Mean for Existing Health Files?

While there are a number of health-focused bills that will need to be reintroduced following the resumption of Parliament, the business of government continues - this transition is not quite the caretaker mode that governments find themselves in prior to a general election.

This means that the government can proceed with policy implementation for items where there is existing funding approval from Parliament, and Cabinet will continue to meet in order to move forward the functions of government (including their regulatory powers).

It is unlikely, though, that net-new policy will be announced in the coming weeks until a new Prime Minister is in place, however, the government will need to be in a position to respond to emerging issues - such as the Canada/US relationship - as well as any priorities of provincial and territorial governments.

Opposition Reaction

In a video posted on social media, Mr. Polievre reiterated many of the criticisms of the government, its policies and the Liberal record. He restated the Conservative demand for a “carbon tax” election now. At the time of this memo, no other media statements have been made by the Conservative Party.

The NDP has reiterated that the party will not support the Liberal government, even if a new Leader is elected, and called on Canadians to support the NDP in the next election. This likely means that Canada will have a general election following confidence votes once Parliament resumes business on March 24th. However, it will take some time to bring down the government there are a number of steps that need to be taken first - including the selection of a speaker and a speech from the throne.

The Bloc Quebecois did not take umbrage with prorogation, citing the need for a Prime Minister who can lead through the first two months of the Trump administration, but asked for an election to be called as soon as possible so that an election takes place by early spring at the latest.

Background Information

Choosing the Next Liberal Leader 

The National Board of Directors of the Liberal Party will be responsible for establishing the rules of the leadership race, and the date of the vote. In this case, the timeline for a leadership race is tighter than  usual, so the process is likely to be slightly different than in years past.  Importantly, the Liberal Party will set out the date by which prospective candidates must declare their intention to run. 

The Prime Minister’s Role Until a New Leader Is Chosen

Mr. Trudeau will remain Canada’s Prime Minister until the next Liberal leader is selected, and will be guiding the government through a critical period, particularly in light of the new Trump administration.  The inauguration of Donald Trump as the 47th president of the United States is scheduled to take place on Monday, January 20, 2025.

Negotiations with the new Trump administration will be a top priority for the government, although it remains to be seen how much of the direct negotiations the Prime Minister will participate in, in light of today’s announcement and the tone of President-elect Trump’s, and his team’s, recent communications on Canada.

What Does Prorogation Entail?

Prorogation in Canada refers to the formal suspension of a parliamentary session by the Governor General, acting on the advice of the Prime Minister. When Parliament is prorogued, the legislative agenda is paused, and all bills and business that have not been passed or completed are terminated, though they can often be reintroduced in the next session. Additionally, parliamentary committees cease to function, and any ongoing committee work stops until committees are reconstituted after Parliament reconvenes. During prorogation, Members of Parliament and Senators do not meet, and no parliamentary sittings occur until a new session begins.

The Prime Minister’s Remarks

In an address to Canadians in front of Rideau Cottage, the Prime Minister thanked his family and friends for their support but said after much reflection, he had decided to step aside as Liberal Party leader and as Prime Minister once a new Liberal leader is selected.

Overall, the Prime Minister framed his decision as one that is best for both the country and for democracy. Saying that although he is “a fighter”, a phrase he used several times, the Prime Minister  does not feel he can lead while having to fight internal battles and he hopes his resignation will “turn down the temperature” politically.

Regarding his decision to prorogue Parliament instead of dissolving it and calling an election, he reasoned that Parliament is in a state of dysfunction and has been paralyzed for months and that prorogation is the best option to restore a more functioning government. He emphasized that the Liberal Party represents an optimistic and ambitious vision for Canadians contrasting it with the Conservatives under Pierre Poilievere who he feels is dividing Canadians. More candidly, the Liberal Party of Canada is able to benefit from being in government - with the ability for the Prime Minister to request prorogation - which gives the Liberal Party time to conduct a leadership contest in advance of the set-election date of October 20, 2025. This would then provide the Liberals, they hope, a fighting chance in the next election under a new leader.

The Prime Minister took the opportunity to highlight what he felt were successes under his leadership, in particular for the middle class - also the Conservative's weakest policy issues according to polls - including climate change and Indigenous reconciliation as well as supporting the war in Ukraine and the pandemic.

Other highlights of his remarks include:

• There will now be a “robust, nationwide leadership race” for the next leader of the Liberal party thereby allowing Canadians a “real choice” in the next election. This leadership race would likely need to be completed before March 24, 2025, when Parliament resumes.

• When asked about Minister Freeland’s resignation and the impact of that on his decision, the Prime Minister praised the partnership between the two and said he wished she had agreed to stay on as Deputy Prime Minister and take on the important challenge of negotiating with the next American administration, but would not comment further on their private discussions.

• His biggest regret is that the electoral reforms the party proposed (ranked ballots) did not move ahead as it may have prevented some of the polarization we see today in Canadian politics as he did not feel he could change their electoral system unilaterally without full support from all other parties. 

• When asked about Pierre Poilievre, he responded by saying, "Pierre Poilievre’s vision for Canadians is not the right one." He criticized Poilievre for failing to support investments in a greener and more inclusive economy and for backing away from core Canadian values. He also stated that Poilievre’s focus is on dividing the country rather than uniting it.