Bill Morneau made it official tonight: during a time when the Canadian economy faces the most challenging months of arguably any government in history, he will not be continuing as Finance Minister. Morneau will not run again as Member of Parliament for Toronto Centre, resigning his seat immediately and leaving it vacant for a yet-to-be-announced by-election. He also announced that he will put his name forward as the next Secretary General of the Organization for Economic Co-operation and Development (OECD).
Morneau’s exit was probably inevitable given the exchange of quotes about the Finance Minister’s interactions with the Prime Minister’s Office that surfaced in reports over the past week. It was clear that a rift between the two offices was developing over the last few months, as fiscal stimulus measures were announced and rolled out at record speed.
If accounts that have surfaced in the media can be taken at face value, this was all about policy. That is, counting all the accounts where “reliable sources” (read Prime Minister’s Office) were involved.
It was reported that the Finance Minister wanted the Canada Emergency Response Benefit (CERB) to be capped at $2,000, and that there would be a one year rather than a two-year EI premium freeze. We are told that, during the most heated discussions as the government was reeling from the economic impact of the pandemic, Morneau pushed for a 10 per cent wage subsidy rather than the significantly higher ceilings called for by the Prime Minister’s Office.
However, when decisions like these are made on a quiet night in August, it is never simply about policy. There was the disclosure on the day of Morneau’s appearance at Finance Committee during the meetings focused on the WE scandal, when the Finance Minister let everyone know that there was a $41,000 expense from a WE junket that he failed to report. It was abundantly clear to anyone close to government that talks surrounding his fitness for his role rapidly multiplied in the highest places in Ottawa.
The pace of this growing divide was accelerated beyond repair when Mark Carney, the former Governor of the Bank of Canada and the Bank of England, was tapped as an “informal adviser” for the post-COVID recovery period. Arguably a wisely timed diversion from the WE scandal for this government; it was also an announcement that reportedly blindsided Morneau. It also implicitly affirmed that his were not the safest hands to steer the Canadian economy, nor that he even had the best read on the compass points. Despite attestations that he had the full confidence of the Prime Minister, it became a question of not if but when Trudeau’s government would announce a new Finance Minister.
Who that will be is still an open question. The conjecture of whom within Cabinet will fill Morneau’s shoes has already begun. Navdeep Bains, François-Philippe Champagne, Jean-Yves Duclos and, of course, Chrystia Freeland have already been named as possibilities.
The larger question of how significant a Cabinet shuffle this government will announce in the days ahead has yet to be answered.