Chrystia Freeland resigned from Trudeau's cabinet on Monday, hours before she was set to release the fall economic statement.Adrian Wyld/The Canadian Press
Chrystia Freeland announced Monday that she was resigning as finance minister in a letter written to Prime Minister Justin Trudeau and posted to social media.
The move, just hours before she was set to deliver the fall economic statement in the House of Commons, sent shockwaves across Ottawa and Canada’s political landscape, especially given her sharp criticism of Mr. Trudeau’s leadership and his handling of the country’s economy.
Here’s what to know about the resignation so far.
Why did Ms. Freeland resign?
Ms. Freeland said she resigned after Mr. Trudeau informed her on Friday that he no longer wanted her to be his top economic minister. She said the Prime Minister offered her another cabinet post but did not say what it was. According to a source, Mr. Trudeau offered her a standalone Canada-U.S. relations portfolio, which Ms. Freeland considered a demotion and declined.
The Prime Minister also told her that she would be replaced by Mark Carney, the former governor of the Bank of Canada and the Bank of England, sources later told The Globe and Mail.
“Upon reflection, I have concluded that the only honest and viable path is for me to resign from the Cabinet,” she said in a letter to the Prime Minister that she posted on X.
“To be effective, a minister must speak on behalf of the Prime Minister and with his full confidence. In making your decision, you made clear that I no longer credibly enjoy that confidence and possess the authority that comes with it.”
Why has there been tension with the PMO?
In the resignation letter, Ms. Freeland wrote that she and the Prime Minister have been “at odds” over the past few weeks.
The Globe reported last week, citing 10 sources, that tensions had risen between Ms. Freeland and the PMO over increased spending, such as the two-month GST holiday on toys, alcohol and food, and a promised $250 rebate for working people earning $150,000 or less. The two measures would cost $6.28-billion combined.
Mr. Trudeau declined to defend Ms. Freeland in the wake of the reports, raising speculation he was looking to remove her. It appears Mr. Trudeau’s renewed efforts to recruit Mr. Carney to cabinet also contributed to the tensions.
How is Mr. Carney involved?
In September, Mr. Trudeau appointed Mr. Carney to chair the Leader’s Task Force on Economic Growth for the Liberal Party. He also serves as the UN Special Envoy on Climate Action and Finance.
The Globe reported last summer that the PMO was trying to recruit Mr. Carney to cabinet. Mr. Trudeau had told Ms. Freeland that Mr. Carney would replace her in their Zoom meeting on Friday, sources later told The Globe, despite those close to Mr. Carney having said he was unlikely to accept the offer.
When Ms. Freeland stepped down, all eyes turned to whether Mr. Carney would take her portfolio. But it was Public Safety Minister Dominic LeBlanc who was subsequently sworn in as Finance Minister. It was initially unclear between Monday and Wednesday whether Mr. Carney had accepted Mr. Trudeau’s offer before the Prime Minister told Freeland she would be replaced or at any point after.
But Mr. LeBlanc said in a Brunswick News interview published Wednesday that talks with Mr. Carney had broken off and he would not join the Liberal cabinet. Mr. LeBlanc also said Mr. Trudeau had given him assurances that he would remain in his new role.
Justin Trudeau and Chrystia Freeland pose for a picture holding the 2024-25 budget, on Parliament Hill in April.Patrick Doyle/Reuters
Who is the new Finance Minister?
Mr. LeBlanc, who has been Public Safety Minister at the forefront of issues involving the Canada-U.S. border and the incoming administration of U.S. president-elect Donald Trump, was sworn in as Finance Minister at Rideau Hall on Monday afternoon.
A long-time friend of Mr. Trudeau, he has held cabinet responsibilities for intergovernmental affairs and fisheries since the Liberals took power in 2015. The Liberal government stalwart was also at the table with Mr. Trudeau for his recent dinner with Mr. Trump at the president-elect’s residence in Florida.
However, many business leaders have raised concerns that the Harvard-educated lawyer and long-time public servant doesn’t have the financial chops or ties to helm the portfolio.
Was the fall economic statement still released, and what did it say?
Ms. Freeland’s sudden resignation left the government scrambling to figure out how to handle the unveiling of its fall economic statement, pushing back the media embargo period from 10 a.m. to 1:45 p.m. ET, as copies remained under a black sheet.
But after all the uncertainty, government House Leader Karina Gould stepped in to table the fiscal update Monday in the House of Commons shortly after 4 p.m., the same timing expected before Ms. Freeland resigned.
The fall economic statement showed a $61.9-billion deficit for the last fiscal year ending March 31, surpassing Ms. Freeland’s self-imposed deficit pledge by more than $20-billion. It also did not include funding for the $250 cheques that were at the centre of tensions between her and Mr. Trudeau.
What else was mentioned in the resignation letter?
Ms. Freeland said in her resignation letter that the country faces a “grave challenge” with the incoming Trump administration and its threat of 25-per-cent tariffs.
“We need to take that threat extremely seriously. That means keeping our fiscal powder dry, so we have the reserves we may need for a coming tariff war. That means eschewing costly political gimmicks, which we can ill afford and which make Canadians doubt that we recognize the gravity of the moment.”
Ms. Freeland also said that the government should build Canadian allies to confront Mr. Trump’s America First economic agenda and work co-operatively with premiers and territorial leaders.
Prime Minister Justin Trudeau has lost a number of cabinet ministers in recent months.DARRYL DYCK/The Canadian Press
Which other ministers have resigned recently, and will Mr. Trudeau shuffle cabinet?
Ms. Freeland isn’t the only minister to have departed Mr. Trudeau’s cabinet in recent months, or even on Monday. A cabinet shuffle is expected Friday to fill eight posts vacated or filled by ministers who have previously said they won’t run again.
Housing Minister Sean Fraser announced the same day as Ms. Freeland that he was resigning from cabinet. He also doesn’t plan to run in the next election, saying he made the decision earlier in this fall so that he could spend more time with his young family.
Randy Boissonnault stepped down as minister of employment, workforce development and official languages on Nov. 20 amid controversy over his business ties and his confusing statements about his Indigenous heritage, for which he apologized. The MP for Edmonton-Centre remains in the Liberal caucus while he focuses on “clearing these allegations,” Mr. Trudeau said at the time.
In September, then-transport minister and Trudeau’s Quebec lieutenant Pablo Rodriguez resigned from his cabinet post and left the Liberal caucus to sit as an independent to seek the leadership of the Quebec Liberal party. Prior to that in July, then-labour minister Seamus O’Regan stepped down from cabinet for “family reasons” but remains a Liberal MP for St. John’s South-Mount Pearl.
Also in September, The Globe reported that four more Liberal cabinet ministers had told Mr. Trudeau they would not seek re-election in the next election: Dan Vandal, Northern Affairs Minister; Carla Qualtrough, the Sport Minister; Filomena Tassi, the Minister for the Federal Economic Development Agency for Southern Ontario, and Marie-Claude Bibeau, the National Revenue Minister.
This is by far the largest exodus of ministers for Mr. Trudeau in his more than nine years as Prime Minister, though not the first. In February, 2019, veterans affairs minister Jody Wilson-Raybould stepped down from cabinet over pressures from him and his office in the SNC-Lavalin affair when she was justice minister. Then-health minister Jane Philpott also resigned over the scandal less than one month later.
Ms. Freeland is also the second finance minister in a row to resign. Her predecessor, Bill Morneau, stepped down in August, 2020 also amid reports of tension with the PMO, though he said at the time he had never intended to run in the next election in order to put his name forward as the next secretary-general of the Organization for Economic Co-operation and Development.
What has been the reaction from the opposition parties?
Conservative Leader Pierre Poilievre held a news conference Monday, saying the Prime Minister has lost control and urging the NDP to join the other opposition parties to defeat the minority Liberal government. He also reposted Ms. Freeland’s resignation letter on X without adding his own commentary.
“The minister of finance resigned in the middle of an economic crisis and one-fifth of his caucus has lost confidence in him. That shows Justin Trudeau has lost control but he is hanging onto power,” he said. “Everything is spiraling out of control.”
Conservative Leader Pierre Poilievre says the Prime Minister has lost control and urged the NDP to join the other opposition parties to defeat the minority Liberal government.Patrick Doyle/Reuters
NDP Leader Jagmeet Singh, who has propped up the Trudeau government, put out a statement saying Liberal infighting is coming at the expense of dealing with the country’s economic challenges.
Mr. Singh later called on Mr. Trudeau to resign but did not say his party would withdraw confidence in the Liberal government, which would force an election.
Despite repeated questioning from reporters on Monday about the NDP’s position, Mr. Singh would only say “all options are on the table.”
At least 13 Liberal MPs also called for Mr. Trudeau to step down since Monday. Patrick Weiler, MP for West Vancouver-Sunshine Coast whom months ago was among several MPs who questioned Mr. Trudeau’s leadership of the party, said on Monday that “today’s developments only reinforce this call.”
He wrote in a statement posted on X that “it is clear the Prime Minister has lost the confidence of many members of caucus and increasingly much of the country.”