Budget 2026 is called Masters of our destiny. On one front, though, it leaves Canada at the mercy of events: the rising costs of climate change.

This summer showed what that looks like. Severe weather caused $3.7 billion in insured damage, making it the third-worst summer on record. Wildfires destroyed hundreds of homes in British Columbia and reduced Namaygoosisagagun First Nation to ashes. Heavy rain collapsed roads in Quebec's Laurentians.

Disasters like these bring direct costs: household repair bills, rising insurance premiums, and recovery costs paid with tax dollars. But the damage doesn't end when the water recedes or the fire is out. Disrupted supply chains, lost work days, and damaged infrastructure slow the whole economy. Canadian Climate Institute research finds that climate change since 2015 alone costs Canada about $25 billion a year in lost GDP growth, rising toward $80 billion a year by mid-century. That means lower incomes for households and less revenue for governments, just as repair bills climb.

The budget’s answer to those costs is mostly cleanup. It commits about $2.7 billion over five years for emergency management in First Nations communities, largely to pay for emergencies that have already happened and for future disaster recovery. Only about $15 million a year—less than a drop in the bucket—goes to proactive wildfire prevention and fire protection. The budget also offers up to $2.5 billion in financing to build waterbombers.

In other words, Ottawa is budgeting to pay for disasters, not to prevent them.

Canada has a National Adaptation Strategy to avoid climate damage before it happens. The budget doesn't mention it once. What little adaptation funding it contains is small and short-term: $3 million for a single year of flood mapping, and $1 million a year for the national climate change assessment. Several key federal adaptation programs expire in 2027-28 or have already run out of money, and the budget offers no plan to renew them.

That is an expensive omission. Our analysis shows that priority adaptation measures return up to $15 in benefits for every dollar invested. But federal investment in adaptation has been too small to capture those returns, with little evidence that it has made Canadians safer. More than a million homes are still at risk of severe flooding, and most Canadians are not prepared for the harsher and more volatile climate that is coming.

This matters for the government's own agenda. The budget's central promise is to build Canada strong: homes, trade corridors, energy and resource projects, community infrastructure. Climate damage threatens all of it. Washed-out highways, railways, and burned transmission lines disrupt trade and power. Unplanned disaster costs strain the fiscal plan. Homes built in floodplains and wildfire zones become future recovery bills.

To build Canada strong, Ottawa should start with three priorities.

First, make sure federal dollars are used to build out of harm's way. The budget adds $13 billion to Build Canada Homes and commits $51 billion over 10 years to the Build Communities Strong Fund. Nothing in it ensures that this money steers new homes and infrastructure away from high-risk flood and wildfire zones. Unless that changes, Ottawa will pay to build homes, then pay again to rebuild them.

Second, invest in protecting the infrastructure and communities already at risk. Canada can upgrade its aging roads, bridges, and storm sewers to handle a hotter and more unpredictable climate now, or pay billions more each year in repairs later. Provinces, territories, and municipalities own almost all of Canada's public infrastructure. Although those governments are eligible to apply for adaptation project funding through Ottawa's Build Communities Strong Fund,  the fund has no dedicated support for adaptation and those applications must compete with applications for every other infrastructure need—from roads and water systems to recreation centres. Infrastructure adaptation needs dedicated, predictable, long-term federal support.

Third, finish the job on updating and sharing climate risk information. Households, businesses, and investors can only make resilient choices if they understand the threats. Ottawa should work with provinces and territories to deliver up-to-date, accessible flood, wildfire and other hazard maps across the country—and soon. A one-year extension for flood mapping is not a plan.

The government still has room to address these gaps; there are opportunities for adjustment in the Spring Economic Update and in the rules that Ottawa will set for the housing and infrastructure money it is committing. A strong Canada invests in its future prosperity and prepares for the climate it will actually face. It doesn't wait for disaster to arrive, then pay to repair and rebuild, again and again. Being masters of our destiny means building for the future climate—now.

Ryan Ness is director of adaptation at the Canadian Climate Institute.

The views expressed are those of the author(s). National Newswatch Inc. publishes a range of perspectives and does not necessarily endorse the opinions presented.