In his inaugural budget, Prime Minister Mark Carney has unveiled plans to invest over $1 billion in the next five years to enhance Canada’s artificial intelligence and quantum computing landscapes and integrate AI technology more extensively within federal government activities.
The 2025 budget, presented by Finance Minister François-Philippe Champagne, outlines a commitment to allocate $925.6 million over the next five years towards establishing a significant “sovereign” public AI infrastructure. Of this amount, $800 million originates from funds earmarked in the previous federal budget, which had pledged a total of $2 billion to bolster domestic AI compute capabilities and construct public supercomputing infrastructure.
This financial injection aims to enhance AI compute availability, facilitate access to sovereign AI compute capacity for both public and private research endeavors, and position Canada as a globally competitive player within a secure and sovereign environment. Since assuming office, Carney has advocated for Canada to embrace AI technology and create a sovereign Canadian cloud to safeguard sensitive data within the country’s jurisdiction, subject to Canadian laws.
Regarding quantum computing, the federal government is proposing a $334.3 million investment over five years across various government departments and agencies to anchor quantum technology firms in Canada and facilitate the adoption of this technology in defense-related sectors and industries. This funding is anticipated to be channeled through the Defence Industrial Strategy, which is not anticipated for release until later this year at the earliest.
Quantum computing, known for its ability to complete tasks at significantly faster speeds than traditional computing methods, remains predominantly experimental in nature.
The budget also includes several smaller AI initiatives, such as AI Minister Evan Solomon collaborating with industry players to identify promising AI infrastructure projects and establish memoranda of understanding with these projects. Additionally, the government has already engaged in at least one memorandum of understanding with a Canadian-based AI company, Cohere, to explore avenues for deploying AI technology to enhance public services and bolster Canada’s commercial AI capabilities.
Carney’s administration is open to exploring the provision of new AI incentives and supports. The budget outlines plans for Canada to develop a new AI strategy by the year’s end, though the specific timing for its presentation remains unspecified.
Furthermore, the 2025 budget details various strategies for embedding AI technology within federal government operations to enhance productivity and service delivery. Notably, Ottawa will establish an Office of Digital Transformation tasked with proactively identifying, implementing, and scaling technology solutions throughout the federal government. This initiative is envisioned as a significant opportunity for domestic innovators to contribute to the government’s technological evolution.
Shared Services Canada, in collaboration with the Department of National Defence and the Communications Security Establishment, is set to develop a made-in-Canada AI tool for deployment across federal agencies. The budget highlights partnerships with leading Canadian AI firms to develop this internal tool.
Moreover, different departments and agencies have identified opportunities to leverage AI technology to achieve cost savings by streamlining workflows, reducing manual efforts, and optimizing service delivery. For instance, the Department of Justice plans to integrate AI, advanced analytics, and automation tools to streamline tasks, while Transport Canada aims to utilize AI and automation to decrease costs associated with repetitive tasks.
Lastly, the budget proposes allocating $25 million over six years, commencing this year, to Statistics Canada for the implementation of the Artificial Intelligence and Technology Measurement Program (TechStat). This initiative aims to leverage data to assess the utilization of AI by organizations and comprehend the technology’s societal impact in Canada.
