OTTAWA, Oct. 6 (Xinhua) -- The Canadian federal government announced Monday a major overhaul of its national budgeting process, introducing a new Capital Budgeting Framework to spur capital investment and address the country's growing investment gap with the United States.
The Department of Finance Canada stated in a news release that the reform is designed to make capital investment a national priority amid concerns that Canada's business investment levels have stagnated since 2015, while U.S. investment has steadily increased.
"Without a step-change in capital investment, Canada risks falling further behind," the ministry said, with data showing significantly lower Canadian investment in forward-looking, productivity-enhancing areas like intellectual property, advanced technologies and modern manufacturing compared to the United States.
According to the release, the Capital Budgeting Framework will distinguish day-to-day operational spending from expenditures aimed at stimulating public and private sector "capital investment," which is defined broadly as any government expense or tax expenditure that contributes to capital formation.
The government will also transition to a fall budgeting cycle, starting with the release of Budget 2025 on Nov. 4, which will be followed by an economic and fiscal update in the spring, said the release. ■