OBOT’s 2025 Federal Pre-Budget Submission

As the trusted voice of Ottawa’s business community, the Ottawa Board of Trade is proud to present our 2025 Federal Pre-Budget Submission: a pivotal call to action at a defining time for our city and its future. Ottawa’s businesses are the engines of local growth, and our members’ perspectives shape every recommendation we bring forward to government. With the National Capital Region at the heart of Canada’s identity and global image, this pre-budget cycle is a crucial opportunity to champion bold investments that will stabilize, diversify, and celebrate our region. Through unwavering advocacy, we urge federal leaders to recognize Ottawa’s unique needs and commit to revitalizing our economy, enhancing our institutions, and ensuring Ottawa remains a vibrant, world-leading capital worthy of every Canadian. We invite you to read our full submission below.

Recommendations

Recommendation 1: That the federal government commit to stabilizing and revitalizing the National Capital Region by acting as a responsible landlord and anchor employer, with a clear, transparent workforce strategy, a time-bound plan to repurpose or divest surplus office space into mixed-use development, and a commitment to properly maintain and invest in the federal properties it retains.

Recommendation 2: That the federal government invest in diversifying the National Capital Region’s economy by formally making the region as Canada’s Defence Innovation Hub, aligning procurement policies to act as a first customer for Canadian solutions, and providing targeted investment to accelerate related research, commercialization, and enabling infrastructure.

Recommendation 3: That the federal government provide dedicated bicentennial funding to celebrate the National Capital Region’s 200th anniversary in 2026, revitalizing national cultural assets and public spaces to strengthen civic pride, tourism, and Canada’s global image.

Recommendation 4: That the federal government launch a National Productivity Strategy to unlock private sector growth, raise Canada’s GDP per capita, and strengthen long-term prosperity. This strategy should modernize the tax system to encourage investment and innovation, expand access to capital for domestic startups and scale-ups, accelerate SME adoption of digital and AI tools, boost export readiness through programs like the Trade Accelerator Program, and reduce regulatory barriers and administrative burdens through smarter, technology-enabled government service delivery.

A National Capital Region Worthy of a G7 Nation

The National Capital Region is far more than just a city. It is home to Parliament, the Supreme Court, Canada’s national institutions, diplomatic missions, and the landmarks that symbolize our democracy and shared history. It belongs to every Canadian, serving as a living reflection of who we are, what we value, and what we stand for.

Yet today, the National Capital Region’s downtown core is struggling. Quiet streets, dark storefronts, and underused federal towers are stark reminders of a government presence that has shifted dramatically without a clearly communicated plan for a responsible transition. More than 150,000 people living in the National Capital Region are employed by the federal public service. As further public service cuts loom —by some estimates, up to 24,000 jobs in the National Capital Region cut by 2028 —the consequences are immense. These include stalled investment due to uncertainty, a weakened economy, further business closures and possibly, talent flight to new markets with impacts to the region’s tax base.

At a time when Canada is working to assert itself globally as a strong and trusted middle power, our National Capital Region must reflect this ambition. It should stand proudly alongside other great capitals like Washington, Canberra, and Paris, where national governments have long understood that a vibrant capital city is vital to projecting national confidence, building identity, and driving economic strength.

Canada’s own history shows the way. In the 1890s, Prime Minister Sir Wilfrid Laurier spoke of shaping Ottawa into the “Washington of the North,” proving that a national capital could be consciously created as a symbol of Canada’s rising confidence and ambition. Prime Minister William Lyon Mackenzie King carried this vision forward through the Greber Plan, which modernized Ottawa’s design and preserved its parklands for generations. Prime Ministers Diefenbaker and Lester B. Pearson strengthened the capital’s cultural fabric with Centennial investments, including the National Library and Archives and the National Arts Centre.

This legacy should guide us now. The Ottawa Board of Trade urges today’s federal leaders to honour this tradition by taking responsibility for the National Capital Region, which has been through a significant amount of transformation, and act boldly, beginning with four critical areas.

Recommendation 1: Be a Responsible Federal Actor

The federal government must demonstrate clear leadership and accountability in the National Capital Region. As its largest employer and landlord, the government’s workforce and real estate decisions directly shape the region’s economic health, housing supply, and downtown vitality.

The Ottawa Board of Trade does not ask for a forced return to work, or to the past, but clarity and action are essential to stability and investment. A clear, modern workforce strategy must be matched with a transparent, time-bound plan to repurpose or divest surplus office space into vibrant mixed-use developments that bring more residents, workers, and visitors into the core.

At the same time, the federal government must properly maintain and invest in the buildings it chooses to keep. Too many federal properties today are deteriorating due to chronic underinvestment, while taxpayers continue to cover rising operating costs. Responsible stewardship means ensuring that public assets are safe, modern, energy-efficient, and ready to support the National Capital Region’s long-term prosperity.

When the federal government sets a strong example as a responsible anchor institution and good neighbour, private investment will follow, strengthening the entire region.

Recommendation 2: Diversify the National Capital Region’s Economy

The National Capital Region must reduce its overreliance on the public sector. As Canada’s fourth largest city and Ontario’s second largest, the region deserves a resilient, future-focused economy. With its depth of talent, leading research institutions, and strong base of defence and security firms, the National Capital Region is well positioned to become Canada’s leading Defence Innovation Hub.

Other countries have shown how deliberate federal leadership can build robust clusters that strengthen national security and local prosperity. From Northern Virginia’s defence corridor around Washington to Toulouse’s aerospace sector, these regions thrive because their governments provide clear support, aligned procurement, and strategic investment.

By formally designating the National Capital Region as Canada’s Defence Innovation Hub, aligning procurement to act as a first customer for innovative Canadian firms, and investing in the infrastructure and talent needed for cutting-edge research and development, the government can help secure Canada’s economic future and meet urgent security needs.

Critical to this, a modern, innovation-focused procurement framework is essential. When the federal government helps Canadian companies prove solutions, grow, and compete globally, it creates high-value jobs at home and strengthens the region’s resilience.

Recommendation 3: Invest in the National Capital’s Bicentennial

In 2026, the National Capital Region will mark its 200th anniversary, a milestone that should celebrate our shared history and strengthen Canadian identity. This is a unique opportunity to reinvest in the cultural and civic assets that define Canada’s capital.

Dedicated bicentennial funding should upgrade museums, heritage sites, ceremonial corridors, and public programming. This investment will boost tourism, create jobs, and renew the National Capital Region as a source of pride for Canadians and a symbol of Canada’s confidence on the world stage, building on the legacy of Laurier, Mackenzie King, Diefenbaker and Pearson, who all believed in a strong capital for every generation.

Recommendation 4: Launch a National Competitiveness and Productivity Strategy

Canada’s GDP per capita has slipped to the bottom of the G7, and our business investment per worker remains well below that of our global peers. Tackling this challenge must be a national priority. The National Capital Region can and should be a leader in reversing this trend by attracting capital, talent, and innovation.

To unlock Canada’s full economic potential, the federal government should launch a clear National Productivity Strategy that includes:

• A comprehensive review and modernization of Canada’s tax system to reward investment in machinery, equipment, intellectual property, and research and development.
• Strengthening programs like the Venture Capital Catalyst Initiative to expand access to early-stage and growth capital for Canadian companies.
• Renewed funding for proven export-readiness supports such as the Trade Accelerator Program to help SMEs reach new global markets.
• Measures that encourage pension funds and financial institutions to increase domestic investment in Canadian startups and scale-ups through co-investment models, tax incentives, and flexible regulatory tools.
• A modern regulatory framework that helps Canadian businesses, especially SMEs, adopt new digital and AI tools to drive productivity.
• Deployment of AI and smart digital systems within federal departments to reduce red tape, automate routine tasks, and deliver faster, more effective services to businesses and citizens.

Conclusion

A strong, resilient, and vibrant National Capital Region is not a luxury; it is a national necessity. It must reflect Canada’s unity, ambition, and global standing as a G7 nation and trusted middle power.

By acting as a responsible landlord and employer, investing in economic diversification anchored by a world-class Defence Innovation Hub, celebrating the National Capital Region’s bicentennial and creating a framework that helps Canadian businesses grow and thrive, the federal government can ensure Canada’s capital remains modern, resilient, and worthy of the country it represents.

The Ottawa Board of Trade and our members stand ready to work with Parliamentarians, public servants, and all Canadians to deliver the National Capital Region our country deserves, now and for generations to come.