Freeland, Trudeau join list of prime ministers and finance ministers who couldn't get along

Finance ministers and prime ministers in Canada have a long history of struggling to stay on the same page.

Experts say that the roles are often at odds, with prime ministers seeking to roll out programs that satisfy voters and help them get re-elected, and with finance ministers looking for ways to balance the budget and reject funding requests. 

Those competing interests can drive finance ministers and prime ministers into opposing camps. So can competing political ambitions.

The collapse this week of the relationship between Prime Minister Justin Trudeau and former finance minister Chrystia Freeland is just the most recent example of what happens when this relationship breaks down.

CBC News took a look at some of the other notable conflicts between prime ministers and finance ministers that have challenged federal governments in the past.

Walter L. Gordon and Lester B. Pearson

First elected as a Liberal MP in 1962 in the Toronto riding of Davenport, Walter Lockhart Gordon was Lester B. Pearson's minister of finance from 1963 to 1965.

Gordon moved into politics after serving as a partner in an accounting firm and working for the Bank of Canada and the Department of Finance during the Second World War.

His business acumen, his role serving as the de facto president of the Liberal Party and his close friendship with the prime minister gave him Pearson's ear from the start.

But that access began eroding almost immediately when Gordon's first budget was so messy that a number of measures had to be withdrawn or rewritten.

"It was a humiliation for a brand new government," Stephen Azzi, a professor of political management at Carleton University, told CBC News. "It was presented on the 59th day of the government's life and almost immediately they were backpedaling from it."

Gordon's subsequent decision to encourage Pearson to call the 1965 election, arguing that the prime minister needed a majority in the House, left him out of favour and ultimately led to his downfall.

When Pearson only picked up three additional seats in the 1965 vote, falling two short of the majority, Gordon resigned from cabinet — accepting responsibility for advising Pearson to run early and then failing to deliver as campaign chair.

Gordon returned to cabinet from the backbench in 1967 to serve as president of the Privy Council after Pearson promised that he would be tasked with directing the work of cabinet. Azzi said that when that promise did not materialize, Gordon decided in 1968 to step down from cabinet a second time.

John Turner and Pierre Trudeau

First elected in 1962, John Turner held a number of cabinet posts, including justice and consumer affairs, before Pierre Elliott Trudeau made him finance minister in 1972.

While presiding over Canada's finances, Turner introduced tax reductions and pension increases while posting surpluses. But his 1974 budget was defeated in the House as the government joined other developed economies in failing to hold back inflation.

The 1974 federal election saw Trudeau's Liberals return to a majority, but a rift developed between Turner and the prime minister over management of the economy and Turner's leadership ambitions.

Randy Besco, a political science professor at the University of Toronto, said a common reason for disagreements in governments is that the finance minister doesn't want to spend money but everyone else does.

"Some minister in some department wants to have money to spend on some program and the finance minister says no. It happens every year," Besco said. "But if the prime minister wants to do it, they are the finance minister's boss. It's difficult for the finance minister to say no."

Besco said the finance minister must decide to either stay and follow orders or resign.

Feeling that he was unable to convince cabinet or Trudeau to reduce government spending, and seeing no way to become leader of the party, Turner resigned as finance minister in 1975.

Paul Martin and Jean Chrétien

While the management of the economy may have been a significant factor in driving Gordon away from Pearson and, to a lesser degree, Turner away from Trudeau, the rift between former finance minister Paul Martin and former prime minister Jean Chrétien was different.

"With the Liberals … one of the ways that they've tried to bridge the left/right divide within their party is to use the position of finance minister to appoint the runner-up … the leader in waiting," said Christopher Cochrane, a political science professor from the University of Toronto.

Cochrane said that policy often holds for a while, but sometimes leads to a falling-out.

Azzi said that, initially, the partnership worked because there was "no daylight" between Chrétien and Martin on fiscal policy and their rift was purely over their competing leadership ambitions. 

When Chrétien won his third majority, it began to look like there was never going to be a time for Martin to step up to the role of prime minister. That put a strain on the pair's working relationship.

The tension between the two men reached a peak in 2002. Martin left cabinet, to be replaced by John Manley as finance minister. Martin swiftly declared his intention to run for leader of the Liberal Party at the next party convention.

Bill Morneau and Justin Trudeau

Bill Morneau was elected to the House of Commons in the 2015 federal election and served as Prime Minister Justin Trudeau's finance minister until August 2020.

When he announced he was stepping down, Morneau told reporters that he was leaving because it was never his plan to run for more that two election cycles. But it was more complicated than that. 

Morneau had been under pressure to quit ever since it was revealed that he had to repay $41,366 in travel expenses covered for him by WE Charity.

Both Morneau and Trudeau were then being investigated by Ethics Commissioner Mario Dion after the Liberal government gave WE Charity a $43.53-million contract to administer a $900-million student grant program, despite both their families having close ties to the charity.

Morneau said at the time he was not pushed out of government, arguing instead that it was time for a new finance minister to battle the economic realities of the pandemic.

In his 2023 book, Morneau modified his story. He said Trudeau let the news cycle and social media dictate his decisions, leading him to lose sight of fiscal prudence and the goal of securing Canada's long-term prosperity.

"After looking at all the options and variables, we submitted a range of weekly incomes justified by our carefully considered calculations, only to be overruled by the prime minister and PMO, who rejected our recommendations in favour of distributing $2,000 per month or $500 a week because the numbers 'sounded good,'" Morneau wrote in his book about the government's decision to issue the Canada Emergency Response Benefit (CERB) during the pandemic.