Prime Minister Mark Carney’s proposed Canada Strong Fund will add an estimated $750 million a year in federal debt interest costs once fully rolled out, according to finance department figures.Blacklock's Reporter says the estimate was provided in a finance department response to the House of Commons government operations committee and comes after critics argued the $25-billion fund is not a true savings account.“Based on the projected interest rates, interest costs are estimated to be $750 million annually once the $25 billion is fully deployed,” the department wrote.Officials warned the final cost could rise.“This estimate is subject to change with future interest rate projections and as details of how the fund will be operationalized are refined over the coming months,” the finance department said.Carney announced the fund April 27, describing it as a national savings and spending vehicle intended to build wealth for Canadians.“Here’s how it works,” Carney told reporters. “A sovereign wealth fund is essentially a national savings and investment account. It’s designed to grow wealth for future generations of Canadians.”“Many countries that are blessed with natural resources like Norway have sovereign wealth funds,” Carney said. “Canada hasn’t had one until now. The new Canada Strong Fund will give all Canadians a direct stake in building Canada strong.”The proposal has been compared with Alberta’s Heritage Savings Trust Fund, launched in 1976 and now worth $32 billion from surplus oil revenues. It also follows the Alaska Permanent Fund, a US$89-billion oil surplus savings account that pays residents an annual dividend. Alaskans received US$1,000 last year..“This will be a Government of Canada fund but more importantly, this will be a people’s fund,” Carney said. “It will be your fund.”Critics questioned how Ottawa can create a sovereign wealth fund when the federal government has no surplus cash to put into it. Parliament has not balanced a budget since 2007.“It’s not really a sovereign wealth fund,” Conservative MP Melissa Lantsman told reporters April 27.“In order to have a sovereign wealth fund you’ve got to run a surplus. You’ve got to have wealth in the system to put in that fund. It’s actually a debt fund that’s going to be paid for by Canadians against their will, and frankly there’s a whole lot of things you can do with $25 billion, like cut taxes.”Finance Minister François-Philippe Champagne did not mention the projected interest charges during a recent Commons discussion on the main estimates for the 2026 budget.“The sovereign wealth fund is a unique opportunity to build collective wealth,” Champagne said.“I think it is a great initiative,” Champagne said. “It is typical of Canada to want to build. That is why we want to build Canada strong.”
