All hell broke loose this week.
#Budget2024 dropped, weighing in at over 400 pages and containing more than $53 billion in net new spending, including several new commitments impacting Canadian tech. Because we love you, BetaKit has produced a 2,500-word budget overview, with an executive summary and the major commitments broken out by section. Some of those commitments, like open banking (or consumer-driven banking as the government calls it), have already received dedicated follow-up stories.
But it seems as though those commitments were entirely overshadowed by the government’s proposed changes to the capital gains tax, which prompted an immediate and loud response.
“The reality is this government cannot execute.”
So please enjoy this emergency podcast recording, featuring Council of Canadian Innovators (CCI) president Ben Bergen and CMD Capital partner Matt Roberts—recorded immediately following an impromptu meeting between Finance Minister Freeland, CCI, and several Canadian tech leaders.
Fresh off the meeting, Bergen does not mince words, calling the budget a “comms strategy that wasn’t thought out.” Striking words from a man who has previously worked for Minister Freeland!
The general consensus from the emergency pod crew is that whatever the quality of work put in, this is very much an election budget, but it’s still unclear to me whether or not the fight Finance currently finds itself in with Canadian tech leaders was something unexpected or, perhaps, planned.
The electioneering radiating from #Budget2024 undermines any detailed evaluation of the innovation policy contained within—from open banking to VCCI—because “a lot of these things are not going to come to fruition if there is an election, if there is change,” Bergen noted.
The trust battery, already low, seems to have drained, and not just due to the growing prospects of another election. Details and execution are two places where this government consistently falters, and if the bloom wasn’t off the rose of the feds’ recent $2.4 billion AI commitment due to the capital gains announcement, it would have been due to the important details on that commitment missing from the budget.
Again, I’m taken back to the question of whether or not the tension and mistrust dripping from every recent #CDNtech LinkedIn post is a reflection of mediocrity or malice on the government’s part. Perhaps it is just realpolitik: pay close attention to the story Bergen tells at the end of the podcast about a meeting with government officials and Canada’s AI leaders just days before the funding announcement, effectively trotting them out as a public sign that the funding commitment had been thoroughly vetted and approved by those leaders.
I might have attributed the checklist consultation approach to a pre-budget crunch were it not for Roberts confirming similar experiences with this government, sometimes only to allow them to prep talking points against his recommendations.
So after allowing Canadian tech leaders to privately voice their concerns, should anyone in attendance be surprised that Minister Freeland publicly doubled down on the tax changes at a press conference right after the meeting?
Let’s dig in.
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The BetaKit Podcast is presented by Osler, Hoskin and Harcourt LLP.
Osler, the leading law firm for startups, high-growth companies and investors in Canada, has released its third annual study of 486 anonymized Canadian venture capital and growth equity financings.
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The BetaKit Podcast is hosted by Douglas Soltys & Rob Kenedi. Produced & edited by Kattie Laur.
