Last week, Canadians went to the polls and elected Canada’s 44th Parliament which, after a tightly contested thirty-six-day election, looks a lot like Canada’s 43rd Parliament. The message from voters is clear: no party deserved to be rewarded with any more power than they had six weeks ago.

Business leaders that were hoping the campaign would feature a robust debate about how to address the short and long-term challenges facing the Canadian economy were left wanting by a divisive campaign that was heavy on attack-ads and light on long-term vision. We were left with no sense of any party’s plans to position Canada for a more sustainable and prosperous future.

Although the campaign is behind us, don’t expect a break from the politicking. Despite what the leaders say, in another minority parliament the next federal election will not be far from their minds if they see an advantage in it.

What does this status-quo result mean? How will a re-elected Liberal minority government implement their campaign commitments? Who are the economic winners and losers with this result? How can you and your executive leadership teams anticipate and influence government decisions? To examine these issues H+K’s National Corporate Advisory Lead, Jason MacDonald moderated a discussion with special guest Hon. John Baird, H+K’s Lead, Content + Digital Lindsay Finneran-Gingras and H+K’s Vice-President, Public Affairs + Advocacy John Delacourt.

Here’s what we heard:

1. Expect a mixed bag for business

On one hand, since they will need opposition support in parliament, we can expect a re-elected Liberal government to continue to govern from the left. On the other hand, after losing the popular vote for a second straight election and failing to achieve a majority government, the government could seek to re-engage with the business community to try and broaden their appeal. Some measures from the Liberal platform, including the proposal to increase corporate taxes on financial services are outright bad for businesses, and their customers. Others, such as a new investment tax credits to support the development of clean technology will benefit companies making these types of investments.

2. Beware of structural changes to the Canadian economy

Most economic policy decisions in the last eighteen months have centered around managing the short-term impacts of COVID-19. As Canada emerges from the pandemic, the government will be forced to confront structural changes occurring in the economy. This includes how to handle the pandemic-driven hollowing out of Canada’s urban centres where most government MPs are from and managing Canada’s clean energy transition in the Western provinces where the Liberal government has little representation.

3. Affordability concerns won’t end with the campaign

MPs will continue to hear concerns about the rising cost of living from their constituents and you can expect government decision making to be filtered through this lens for the foreseeable future. Affordability is a real and emotional issue for Canadians and businesses will need to tap into this emotion – not just the facts and figures – when communicating on affordability issues with the government.

4. It’s time to refocus on the United States

Canada’s closest friend hasn’t been very friendly lately. Between the rejection of Keystone XL, stronger Buy American policies and the continued land border closure, Canada has been out of sight and out of mind for President Biden. The government should re-establish to the same spirit of collaboration with business that helped Canada effectively stand up for its interests during the NAFTA / CUSMA (also known as USMCA) negotiations.

5. The tap needs to be turned off, eventually

Although Canada’s deficit has increased faster than any other developed economy during the pandemic, our rising debt-load was hardly discussed during an election where all major parties proposed significant new spending. With the threat of rising interest rates, whether it wants to or not, at some point the government will need to reduce the deficit through a combination of faster economic growth, reduced spending, and increased revenue through new taxes.

6. Minority means more opportunity to advance your issues

Under majority governments, power is concentrated within the Cabinet and public service. With another minority, more power continues to reside with backbench MPs and parliamentary committees along with political influencers such as the provincial premiers. Many of the 286 re-elected MPs will get new roles and responsibilities and 52 newly elected MPs may have little or no exposure to your issues. In this environment, your business and supporters need to be prepared to tell a compelling story to these different audiences through your direct and grassroots advocacy.

At H+K, our experts in policy, communications, advocacy and public affairs are on top of the latest developments in government – and, more crucially, we are always looking around the corner to see what’s next for your business.