Justin Trudeau announced his intention to resign as Prime Minister and leader of the Liberal Party following the election of a new Liberal Leader. Trudeau also announced that he will be proroguing Parliament until March 24th with the new leader announced on March 9th. The Prime Minister had been facing pressure from Liberal MPS to resign after the resignation of Finance Minister and Deputy Prime Minister Chrystia Freeland in December.

Proroguing Government Explained

  • Prorogation means that a session of Parliament is terminated.
  • All legislation before the House of Commons dies – any Bills that have not received Royal Assent must be reintroduced as if they had never existed.
  • All parliamentary committees also cease to function after prorogation.
  • The result is that all parliamentary business stops, and no opposition party will be able to trigger an election through use of a no-confidence motion.
  • The purpose is to “reset” a minority government that had reached a standstill and grant time for the Liberal Party to select a new leader.

No Confidence Motion

  • In a parliamentary system, the Prime Minister and the Cabinet must answer to the House of Commons for their actions.
  • A government’s mandate requires the continued support (or confidence) of a majority in the legislature.
  • A vote or motion of confidence provides the opportunity for elected officials to decide if the Prime Minister and/or Cabinet Ministers are fit to continue in their offices.
  • Losing a confidence motion usually results in the resignation of a Prime Minister or a snap election.
  • Confidence motions can take the form of explicit motions of confidence or no-confidence or key pieces of legislation such as the budget.
  • It is likely that the government will face a no-confidence vote when it returns on March 24th. The Interim Supply motion provides one such opportunity.

Interim Supply

  • The interim supply is a funding measure that allows the Canadian government to continue its operations until a main budget is approved by Parliament.
  • To finance government activities, a financing bill must be passed throughout the fiscal year, which runs from April 1 to March 31.
  • Since the house has not yet enacted a significant financing package, a resolution to keep the government open must be carried since it cannot operate without one.
  • The incoming Prime Minister would need to pass an interim supply by March 31 in the House of Commons to keep parliament running.
  • The interim supply motion also provides opposition parties with the opportunity for a no-confidence vote.

US/CAN Relations:

  • US/CAN relations will likely be stalled as the leadership election plays out with incoming President Trump being the main topic of the election campaign.
  • Previously Trump has made a pledge of a 25% tariff on Canadian goods citing the border as the defining reason.
  • Despite the Trudeau government plans to help “secure the border” the incoming Trump administration may still implement the tariff.
  • President Trump has celebrated the resignation of Trudeau continuing his “51st state” statement. He has previously criticized former Deputy Prime Minister and perspective Liberal front runner Chrystia Freeland citing her as “toxic” and “[that] she will not be missed.”

Liberal Leadership Process

  • The selection of a new leader will be on March 9th
  • Contenders have to declare their candidacy by Jan. 23
  • There is a $350,000 entry fee to participate in the race
  • To take part in selection process, you must be: registered as a Liberal member by Jan. 27; at least 14 years old; not be a member of any other federal political party in Canada; a Canadian citizen, permanent resident or have status under the Indian Act.
  • Electoral districts are allocated 100 points and voters can rank their preferred candidates.
  • The district points are calculated based on a ratio of the number of first choice votes and the total number of ballots cast.
  • The first candidate to earn more than 50% of the points will be selected as the new Liberal Leader.
  • The prorogation period will last for eleven weeks, which is likely not enough time for a leadership contest under these rules.
  • The party is reported to be considering how the race could be sped up.

Prospective Liberal Leaders:

No one has declared an intention to run at present, but the following individuals are considered to be likely candidates:

Mark Carney (Former Governor of the Bank of Canada and England)

  • Mark Carney, a former Governor of the Bank of Canada, has had a notable economic and financial career including roles at Goldman Sachs and as UN Special Envoy on Climate Action and Finance. Carney has long been speculated as a potential figure in Canadian politics, with recent discussions linking him to Chrystia Freeland’s resignation as finance minister in December. He is currently the chair of a Liberal party task force on economic growth.

Chrystia Freeland (Former Deputy Prime Minister and Minister of Finance)

  • Chrystia Freeland has served in notable positions in Trudeau’s cabinet serving as Deputy Prime Minister, Minister of Finance, Minister of Foreign Affairs, and Minister of International Trade. A Rhodes Scholar with a background in journalism and global economic policy, Freeland played a key role in renegotiating NAFTA (USMCA) and leading Canada’s COVID-19 economic response, before resigning in December amid a “demotion” and speculation about Mark Carney’s political involvement.

Christy Clark (Former Premier of British Columbia)

  • Christy Clark, former Premier of British Columbia (2011–2017), known for her focus on economic growth and job creation, led the province to several balanced budgets and strong economic performance during her tenure, before stepping down following a narrow electoral defeat in 2017.

François-Philippe Champagne (Minister of Innovation, Science and Industry)

  • François-Philippe Champagne has previously served as Minister of Foreign Affairs and Minister of International Trade and was instrumental in negotiating trade agreements. Before entering politics, Champagne had a successful international career in law and business, working with multinational corporations in Europe and North America.

Anita Anand (Minister of Transportation and President of the Treasury)

  • Anita Anand has previously served as Minister of Defense and Minister of Public Services and Procurement; she played a central role in securing Canada’s COVID-19 vaccine supply. Before entering politics, Anand had a distinguished career as a law professor specializing in corporate governance and investor rights.