Budget 2025 Recognizes Local Infrastructure as Critical to Canada’s Economy, Long-Term Plan at Scale Still Needed
December 10, 2025
Budget 2025 recognizes the importance of local infrastructure in meeting Canada’s housing, trade diversification and economic goals. But without a sustained, long-term plan at scale, the federal government’s ambition won’t match the scale or urgency of the challenge.
“Budget 2025 acknowledges that municipal infrastructure is essential to Canada’s productivity and trade,” said Rebecca Bligh, President of the Federation of Canadian Municipalities (FCM). “New and reprofiled investments will help communities move faster on some things now, but a long-term plan at scale to fund the infrastructure that makes national housing and economic goals achievable is still needed.”
Budget 2025 includes a mix of some new and largely reprofiled investments. Of the $51 billion announced for the Build Communities Strong Fund, a significant portion reflects existing commitments which communities had already incorporated into their long-term plans. While this will provide some early momentum for communities, without a sustained infrastructure plan at scale, Canada’s ability to meet the moment to achieve ambitious goals like building 500,000 homes annually is at risk.
It will also be critical to ensure that the available dollars outlined today are deployed efficiently and reach communities without delay. As local governments assess the full scope of the budget, FCM remains focused on ensuring communities have the tools they need to deliver results. That means reliable municipal infrastructure funding to move goods, keep Canada competitive and connect people to work and services. It also means supporting the most vulnerable—people who rely on shelters, public transit, food banks, addiction services, and community centres to get through each day.
FCM welcomes several measures that signal progress for communities across the country. These include:
- With new dollars moving through federal-provincial/territorial mechanisms, leveraging proven channels such as the Canada Community-Building Fund, over a long-term plan at scale, will be critical to meeting national goals.
- $6 billion for municipal infrastructure over 10 years through the Direct Delivery Stream under the Build Communities Strong Fund.
- $12.2 billion for infrastructure, including housing-enabling infrastructure, that’s to be cost-matched by the provinces and territories and linked to reducing development charges where applicable. This approach responds to FCM’s advocacy to take a longer-term, province-by-province approach to development charges.
- A new $1 billion over four years for an Arctic infrastructure fund.
- $5 billion over seven years for a trade diversification corridors fund, which municipalities will be eligible for.
FCM is ready to work with the federal government to ensure municipalities can deliver on shared priorities—from housing affordability to climate resilience and economic growth.
Across Canada, shovel-ready projects like Winnipeg’s North End Sewage Treatment Plant, Brighton’s major wastewater system upgrade to support over 3,000 new homes in Ontario and Montcalm’s plan to develop 52 residential lots in the Manitoba community are waiting on federal investment to move forward. The projects are ready, the ambition is clear, what’s needed is sustained municipal infrastructure investment at scale to unlock delivery. Municipalities are ready to build now.
The Federation of Canadian Municipalities is the national voice of municipal governments, with over 2,000 members representing more than 90 per cent of the Canadian population.
Related Story
Government of Canada Releases Budget 2025: Canada Strong
Canada faces a rapidly changing and increasingly uncertain world. The rules-based international order and the trading system that powered Canada’s prosperity for decades are being reshaped – hurting companies, displacing workers, causing major disruption and upheaval for Canadians.
In the face of global uncertainty, Canada’s new government is focused on what we can control. Budget 2025: Canada Strong is our plan to transform our economy from one that is reliant on a single trade partner, to one that is stronger, more self-sufficient, and more resilient to global shocks. Our plan builds on Canada’s strengths – world-class industries, skilled and talented workers, diverse trade partnerships, and a strong domestic market where Canadians can be our own best customers. We are creating an economy by Canadians, for Canadians.
