Prime Minister Justin Trudeau with Dominic LeBlanc after he was sworn in as Finance Minister at Rideau Hall in Ottawa on December 16, 2024.Patrick Doyle/Reuters
Chrystia Freeland abruptly resigned as finance minister and deputy prime minister, condemning Justin Trudeau’s leadership and his handling of the economy and reigniting calls for the Prime Minister to step down.
Public Safety Minister Dominic LeBlanc, a close friend of Mr. Trudeau, was sworn in as the new Finance Minister in a hastily called ceremony at Rideau Hall Monday. Mr. LeBlanc will also take over from Ms. Freeland as chair of the cabinet committee on Canada-U.S. relations and keep his role as Intergovernmental Affairs Minister.
Ms. Freeland’s exit led to a discussion at cabinet about whether Mr. Trudeau should resign, according to three sources who were briefed on the meeting. Mr. Trudeau called a Liberal caucus meeting later in the day after at least eight Liberal MPs publicly called for him to resign. In that meeting, MPs expressed reservations and concerns, with some repeating their calls to resign, one MP said.
Mr. Trudeau’s message to caucus, the MP said, was that he is not immediately stepping down but that he would reflect on the day’s events. The MP said their takeaway is that the issue of Mr. Trudeau’s future is not closed.
The Globe is not identifying the sources who were not authorized to discuss the internal meetings.
The chaotic day started when Ms. Freeland informed Mr. Trudeau about her resignation just before he was to meet his cabinet on Monday morning. Ms. Freeland was set to deliver the fall fiscal and economic update in the House of Commons in the afternoon, leaving the government scrambling to figure out how to handle the unveiling of its latest economic blueprint. The document, showing a larger deficit than expected for the fiscal year, was tabled in the House by Government House Leader Karina Gould without the traditional speech.
The government missed Ms. Freeland’s deficit target of $40.1-billion, adding more than $20-billion in new spending for a final tally of $61.9-billion for the fiscal year 2023-2024.
Ms. Freeland told Mr. Trudeau in a letter that she was resigning after he informed her on Friday that he no longer wanted her to be his top economic minister. Two sources said Mr. Trudeau spoke to Ms. Freeland in a Zoom call, and offered a cabinet portfolio on Canada-U.S. relations, but without any ministry attached.
That meant she would have no departmental public service staff or statutory authority to deal with the incoming administration of Donald Trump. The sources said she regarded the offer as a demotion.
The Globe is not identifying the sources, who were not authorized to discuss the matter.
“Upon reflection, I have concluded that the only honest and viable path is for me to resign from the Cabinet,” she said in the letter to Mr. Trudeau that she also posted online. “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.”
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Ms. Freeland, who was Canada’s first female federal finance minister, wrote in the letter that she and the Prime Minister have been “at odds” over the past few weeks.
The Globe and Mail reported last week there were rising tensions between Ms. Freeland and Prime Minister Trudeau and his office over spending and efforts to recruit former central banker Mark Carney into the government.
Ms. Freeland said the country faces a “grave challenge,” particularly from U.S. president-elect Donald Trump, who is threatening to impose tariffs of 25 per cent on goods from Canada and Mexico unless firm action is taken to control the borders to stop illicit drugs, such as opioids, from flowing into the United States.
Prime Minister Justin Trudeau speaks to supporters at a Liberal Party fundraiser in Gatineau on Dec. 16, after a chaotic day in Ottawa in which Finance Minister Chrystia Freeland suddenly tendered her resignation from cabinet in a fight over the nation's finances.
The Canadian Press
The government needs to keep spending under control, she said, to be able to effectively deal with the incoming Trump administration, in an apparent swipe at the two-month GST tax holiday on toys, alcohol and food that began Saturday and was seen by her own department as economically unwise.
“We need to take that threat extremely seriously. That means keeping our fiscal powder dry today, so we have the reserves we may need for a coming tariff war,” she wrote. “That means eschewing costly political gimmicks, which we can ill afford and which make Canadians doubt that we recognize the gravity of the moment.”
The president-elect himself weighed in on social media.
“The Great State of Canada is stunned as the Finance Minister resigns, or was fired, from her position by Governor Justin Trudeau,” Trump said on Truth Social, referencing comments he made during a recent dinner with the prime minister in Florida in which he suggested he might make Canada the 51st state.
Trump added that Freeland’s behaviour was “totally toxic” and “not at all conducive to making deals which are good for the very unhappy citizens of Canada.”
“She will not be missed,” he said.
After being sworn in as Ms. Freeland’s replacement, Mr. LeBlanc said his focus will be affordability for hard-pressed Canadians. “We need to be extremely focused on the challenges that the incoming American administration will impose with respect to potential imposition of tariffs,” he said.
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The eight Liberal MPs who called for Mr. Trudeau’s resignation Monday included Ontario MP Helena Jaczek.
“Firing a strong female leader and Minister of Finance, after years of dedicated service, is unacceptable,” she told The Globe. “It is time for Justin Trudeau to resign as Prime Minister.”
Her Ontario Liberal colleagues Francis Drouin, Chad Collins, and Yvan Baker agreed with her, as did P.E.I.’s Sean Casey, Montreal’s Anthony Housefather, B.C.’s Patrick Weiler and New Brunswick’s René Arseneault.
Mr. Baker, Mr. Weiler and Mr. Collins said they were among the MPs who supported the secret letter in October to have Mr. Trudeau resign. The Prime Minister resisted those demands and insisted at the time he would stay on as Liberal Leader.
Prime Minister Justin Trudeau arrives on Parliament Hill on Monday.DAVE CHAN/AFP/Getty Images
On Monday, Mr. Baker told The Globe he does not believe Mr. Trudeau would survive a secret ballot vote on his leadership, if such a vote were held.
On the way out of the caucus meeting, many MPs declined to say whether they still have confidence in the Prime Minister. The government’s chief whip and Ontario MP, Ruby Sahota, said Mr. Trudeau will stay on.
However, she would not say whether he still enjoys the confidence of cabinet or caucus as a whole, only saying “he has my confidence.” Ms. Sahota said discussions are continuing in caucus as to his future, adding that talks are “open in our caucus.”
The clearest divide amongst MPs was articulated by Ontario caucus chair James Maloney and MP Chad Collins, who represents a Hamilton riding.
Mr. Maloney told reporters he believes Mr. Trudeau should remain leader in part because “he’s still got the confidence of the caucus.”
“When we come out of these meetings, we’re united, we’re on the same team, and we support the Prime Minister.”
However, Mr. Collins rejected that conclusion. “I can say we’re not united,” he told reporters after caucus. “There’s still a number of our members who feel we need a change in leadership. I’m one of those.”
Reaction to Chrystia Freeland’s resignation from Trudeau’s cabinet from across political landscape
He declined to say how many Liberal MPs are in that camp but said they fear what Conservative Leader Pierre Poilievre would mean for the country and believe “the only path forward for us is to choose a new leader and to present a new plan to Canadians with a different vision.”
The Globe also reported last week that talks were back on between Mr. Carney, the former governor for the Bank of Canada and Bank of England, and the Prime Minister’s Office, after an unsuccessful attempt to bring him into government in the summer. Two sources close to Mr. Carney strongly suggested this weekend that he would not accept the offer from the Prime Minister to join the government.
The Globe is not identifying the sources who were not authorized to discuss the matter.
Mr. Poilievre held a news conference Monday, saying Mr. Trudeau has lost control and urging the NDP to join the other opposition parties to defeat the minority Liberal government.
“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 spiralling out of control.”
NDP Leader Jagmeet Singh called on Mr. Trudeau to resign, but did not say his party would withdraw confidence in the Liberal government, which is what would be needed to force an election.
Despite repeated questioning, Mr. Singh would only say “all options are on the table.” He then walked away from the scrum as reporters sought more clarity on the NDP’s position.
Mr. Trudeau went into his previously scheduled cabinet meeting just before Ms. Freeland made her resignation public. Many ministers declined to comment on their way into cabinet.
Housing Minister Sean Fraser, who announced his own resignation from cabinet on Monday, was caught off guard by Ms. Freeland’s resignation from cabinet.
“I found her to be professional, supportive of me as a member of Parliament, and I consider her a friend, and that friendship will continue long after my time in politics,” he told reporters.
Mr. Fraser said he was leaving cabinet to spend more time with his family and won’t run again in his Nova Scotia riding. He said he made the decision earlier this fall.
Treasury Board President Anita Anand was visibly upset when she heard about Ms. Freeland’s resignation. “This news has hit me really hard, and I’ll reserve further comment until I have time to process it,” she said.
Natural Resources Minister Jonathan Wilkinson declined to answer questions on whether he still has confidence in the Prime Minister.
“Today was a bad day with respect to the Minister of Finance,” Mr. Wilkinson said. He described her as a “very competent person and a close personal friend.”
Asked if the Prime Minister should resign, Mr. Wilkinson said: “I’m not saying that.”
Ms. Freeland said in her resignation letter 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.
“It is this conviction which has driven my strenuous efforts this fall to manage our spending in ways that will give us the flexibility we will need to meet the serious challenges presented by the United States,” Ms. Freeland wrote.
Ms. Freeland will continue to sit in the Liberal caucus as a backbench MP, and will run again in her Toronto riding of University-Rosedale in the next election.
“Inevitably our time in government will come to an end. But how we deal with the threat our country currently faces will define for us for a generation, and perhaps longer.”
Following The Globe’s reporting last week, Mr. Trudeau declined to come to Ms. Freeland’s defence despite relentless questioning from the opposition. Still, at an evening speech last Tuesday to promote women’s involvement in politics, Mr. Trudeau took credit for appointing Ms. Freeland. He noted she is Canada’s first female finance minister. Three days later, he told her he no longer wanted her to serve in that role.
At a Liberal fundraising event on Monday evening, Mr. Trudeau acknowledged the day’s turmoil.
“It’s obviously been an eventful day. It’s not been an easy day,” he told hundreds of supporters at the Canadian Museum of History in Gatineau.
Mr. Trudeau did not get more specific about Ms. Freeland’s exit.
Vancouver condo developer Bob Rennie, a party member, said it was an understatement for Mr. Trudeau to say it had been a challenging day. He called the day’s events a wake-up call for the Liberal Party, but declined to say if Mr. Trudeau should resign.
With a report from Ian Bailey and The Canadian Press