Budget 2025 hints at airport privatization, CAC welcomes investments

The Canadian government is once again weighing the possibility of privatizing airports, reviving a concept examined and then abandoned nearly ten years ago.

A brief reference in Tuesday’s budget — the first under Prime Minister Mark Carney — signals a willingness to reconsider the ownership model of the country’s multibillion-dollar airports as the government looks to spur private investment in major infrastructure.

“The government will also consider options for the privatization of airports,” the budget document said, after outlining ways the government plans to “unlock more of the economic potential of Canada’s airports and consider new ways to attract private sector investment.”

The first phase will involve working out lease renewals with the various not-for-profit airport authorities nationwide, expanding opportunities for economic development on airport property, and reviewing how airport ground-lease rents are currently calculated.

In Tuesday’s budget, Ottawa outlined plans to invest in airport infrastructure.

Starting in 2026–27, the government will allocate $55.2 million over four years — along with a permanent $15.7 million annually — to Transport Canada for safety-related upgrades and infrastructure projects at local and regional airports.

The investment, delivered through the Airports Capital Assistance Program and incorporating $72.5 million in remaining amortization, will also support a key initiative to lengthen the runway at the Transport Canada–owned Îles-de-la-Madeleine Airport.

This year's budget proposes billions in new expenditures that could push Canada’s deficit up to C$78.3 billion (£42.6 billion), the second-largest in the country’s history.

"Airports are at the heart of Canada's growth story"

In a statement issued yesterday, the Canadian Airports Council (CAC) welcomed the proposals outlined in the budget.

"Airports are at the heart of Canada's growth story," said Monette Pasher, president of the CAC. "We are pleased to see the federal government's recognition of airports' role in trade diversification and economic resilience.”

“Investments in trade and infrastructure will help strengthen our competitiveness and create opportunities across every region of the country."

The CAC notes that in the early 1990s, Canada's airports were privatized to local control, divested from direct federal operation and placed under the management of local airport authorities as non-share capital corporations.

“This model has allowed airports to operate as a business and reinvest billions into infrastructure, positioning them as key trade and transportation hubs,” the CAC said.

The council is now interested to learn more on government's intent to consider options for airport privatization.

"There are many ways to work with pension funds and equity partners, and any options government considers must have affordability for Canadians as the top priority," stated Pasher.

Don’t forget regional & northern airports

While travel demand has returned to pre-pandemic levels at major hubs, many regional and northern airports have not fully recovered, leaving communities and businesses “vulnerable to reduced air service,” the CAC said.

“These airports are vital for regional connectivity, medical access, and safe transportation in remote regions, reinforcing Canada's presence and sovereignty in the North,” the association noted.

CAC applauds Ottawa’s increased support of $55 million for the Airports Capital Assistance Program (ACAP), which is the only dedicated federal funding source for essential infrastructure at small and regional airports.

“With ACAP funding largely unchanged for 25 years, this boost is critical to ensure safety, reliability, and long-term sustainability at regional airports,” the CAC said.

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