The federal government is leaving investment dollars on the table—but it can fix that in the budget

Likewise, the many 2025 federal pre-budget submissions from the social finance community reinforce the vision and possibility of this moment. SVX, Definity Foundation, Raven Indigenous Outcomes Funds, Rally Assets, Relèven, Catalyst Community Finance, Impact Guarantee, the Table for Impact Investment Practitioners, Philanthropic Foundations of Canada, Employee Ownership Canada and our own at Social Capital Partners, amongst many others, have highlighted some of these proposals.

These investments are no longer curiosities or pilots to explore, and the finance and community leaders driving these changes don’t want pats on the head. The ideas are scalable and transformative, and the leaders are ready to step up to support Canadians and the economy at this moment. They must be an essential part of the federal government’s strategy to confront the rupture in the global economic and security system through which we are living. 

Philanthropic leaders are ready to step up in a transformational way. Private capital is increasingly interested—but needs some more enabling support from government. 

I understand that the government’s first priority is mobilization of private pools of capital for big national infrastructure and resource projects. But the government needs to apply the same logic and focus that they’re deploying for big energy projects to mobilizing capital to invest in local Canadian businesses, social purpose organizations and community infrastructure. 

The vast majority of the Canadian economy does not strive to export goods or services. Most businesses serve their local communities and are not directly exposed to trade or tariffs. Of course, the government must help those sectors and workers who are being hit by Trump, but we can also strengthen those sectors that are vital to our economic resilience in the face of attacks on our export sectors. Holders of capital want to invest in local businesses, affordable housing and community infrastructure. Catalyzing these kinds of investments will drive sustainable and inclusive economic growth and help real people. These investments act as economic stabilizers in communities impacted by tariffs. They create hope and opportunity for young people. 

At a time when governments are being careful with every dollar of public expenditure, the social finance community is rising to the challenge and putting forth proposals that highlight how the magic of finance can be used to deliver social and economic benefit for very little risk or investment on the part of government. The government knows this is true for large private investments in natural resource and infrastructure projects. I hope they have internalized that the logic applies—and the people and capital exist—for community and local investment as well. 

And that is the main takeaway I have from reading the Budget submissions and hundreds of conversations over the past year: despite the growing maturity, size and track record of success within the social finance community, we still need better social and community financing infrastructure and more enabling policy and legislative signals. This would allow good social finance investments to properly scale and deliver the kind of outsized impact that is needed at this time. 

What would this look like in practice? I believe the government should be signaling its intent to consult on:  

• the accreditation and capitalization of community finance institutions,  

• the formalization of loan guarantee facilities and co-financing approaches to de-risk projects, and  

• legislative and tax changes that will incent and require more philanthropic and private capital—including pension fund capital—to invest at home and in local communities. 

Whether focused on housing, climate, food systems, poverty reduction, succession planning or local economic development, organizations are leading transformative work that is directing capital in ways that serve communities and long-term economic resilience rather than short-term profit. Social finance, impact investors and transformational philanthropy organizations are looking to the federal government to create the conditions for increased investment. 

The federal government has already demonstrated creativity in using financing in more ambitious ways. The Business Acquisition Loan for Indigenous Communities is one recent example. And earlier this month, the Prime Minister announced that “low-cost capital” will be available to businesses that have relied most heavily on trade with the U.S. 

Many more opportunities exist, but they are constrained by fragmented financing and outdated regulatory frameworks. It is time for the federal government to step up and make it easier to invest in local businesses and Canadian community economies. 

I hope the federal government sees what is happening on the ground in Canada, in communities and with asset holders—and acts accordingly. Building the right policy and financing architecture to support community investment will catalyze more investment, make a material contribution to economic growth, deliver real public value and improve our economic resilience and sovereignty.  

There really is no reason not to get moving on this agenda.