Social Policy in Ontario

To save Canada, Mark Carney is courting foreign money. He’s risking an ‘investment invasion’

Posted on September 15, 2026 in Governance Debates

Source: TheStar.com — Authors: Armine Yalnizyan

TheStar.com – Opinion
Sept. 14, 2026. Updated Sept. 15, 2026.   By Armine Yalnizyan, Contributor

Prime Minister Mark Carney’s big push for foreign investment comes at a time that sectors like health care are looking very tempting to investors. That comes with significant risk to Canada’s care economy, writes Armine Yalnizyan. 

Prime Minister Mark Carney’s “first-ever” Canada Investment Summit kicks off this week, amid the glamour of the Toronto International Film Festival. Canada is rolling out the red carpet for the world’s biggest investors. It’s great theatre, as high-voltage personalities meet high-stakes gambles.

It takes moxy to hold an investor showcase amidst a trade war with the U.S. Canada needs to strut its stuff, proving why it’s shrewd to invest here now, even as our access to the world’s biggest consumer market shrinks.

The urgency of the moment risks blurring the line between attracting capital and surrendering control. Not all investment is good investment. And nowhere are the risks greater than in the care economy — health care, education and social services.

A tsunami of private equity from the U.S. is about to flood global markets, and Canada has no safeguards to prevent the collision of essential services, public dollars and private interests from worsening existing problems.

Canada taking control of its future, Mark Carney tells new investment gathering

Canada’s “Never 51st” response to Trump’s provocations was about more than resisting American control. It was also about protecting what distinguishes Canada, starting with our care economy. True, years of underinvestment have left these services struggling to recruit and retain workers; but they still offer Canadians far more than most Americans can count on. They remind us who and what we are fighting for, not just what we are fighting against.

So it’s worth asking: who has been invited to this investment summit, and what is on offer?

From what has been made public, Carney’s guest list ballooned from 100 people to 250, featuring the biggest stars of global finance: asset managers, pension funds, sovereign wealth funds and private equity firms. Together the investors gathered on Sept. 15 manage over $100 trillion in assets. Carney is the leading pitch man, with 13 premiers as supporting actors. The prime minister says he is seeking “long-term partners” for “long-term results.” To attract them, he has Canadian taxpayers anteing up $280 billion in hopes of leveraging $1 trillion in public, private and institutional investment over five years. It’s unclear what we get in return: is it a 25 per cent equity stake, or is it simply de-risking private investment, once again privatizing gains and socializing losses?

As Carney likes to say, if you’re not at the table, you’re on the menu. This time, Canada is both host and entrée. The pitchbook features deals in energy, mining, infrastructure and defence; 167 deals on 66 pages worth almost $500 billion. Care is not explicitly mentioned, but the document makes clear the listed opportunities are not exhaustive; and the dynamics drawing investors and politicians toward more deals in care are gathering fast.

The Temptation

Making care as reliable as the roads, water systems and power grids we depend on requires more public investment. Provinces and territories resist spending more. In 2024-25, nearly half (49 per cent) of their combined revenues already went to health care, education and other care services, with Ottawa covering only one dollar in six. Now federal focus is on public investments to leverage private capital for big-ticket physical capital builds, not the ongoing work of building and sustaining the human capital upon which the economy relies.

Whether governments spend more or not, demographics virtually guarantee rising demand. Public funding provides steady revenues. Care offers investors an irresistible combination: reliable growth and reliable revenues.

That’s the temptation: private capital readying to rush when public dollars can pull back, raising risks for you and I. We’ve seen this movie before. It does not end well.

The Risk

Pitchbook, a leading private equity database, notes that 2026 began with a surge in “megadeals” in eldercare. During COVID, long-term care homes accounted for 80 per cent of Canada’s COVID-19 fatalities in the first wave. Six of the companies with the worst pandemic death records in Ontario face a massive class action lawsuit. Three were owned by private equity firms at the time and three were publicly-traded companies. Despite their checkered past, five of the six firms in the class action suit went on to receive three-quarters of all newly issued 30-year contracts to provide care from the Ontario government.

OPINION:  Iris Gorfinkel: Same doctor, different price tag: How universal health care is under attack

Steward Health Care is a U.S. cautionary tale. Private equity investors turned six non-profit hospitals into a chain of 31 for-profit hospitals, using leveraged buyouts, sale-leasebacks and complex corporate structures. The deals saddled the hospitals with unsustainable debt and rent payments, while investors paid themselves US$1.3 billion in fees. Steward collapsed in 2024 with more than US$9 billion in liabilities. Workers went unpaid. So did suppliers. Five hospitals closed permanently and two temporarily, straining capacity at nearby hospitals. The surviving hospitals were bought by another private equity firm. Value may be “created,” but workers, patients and communities may pay a high price for it.

Canada does not (yet) permit private for-profit hospitals, but there are troubling developments. Alberta recently approved dual practice payment systems, allowing physicians to choose, patient-by-patient, whether to bill the public plan or patients directly for medically necessary care. The province also now permits those with cash or duplicative private insurance coverage to self-refer for diagnostic imaging without a physician’s referral, jumping the public queue. Rising demand for user-pay services puts the for-profitization of health care on fast-forward, creating an expanding market for investors.

Meanwhile a tidal wave of capital from the U.S. is about to be unleashed.

Larry Fink chairs BlackRock, the world’s largest asset manager, and is a marquee guest at the Investment Summit. In his April 2025 annual letter, he called for the “democratization” of private equity and other alternative investments by extending these bespoke investment opportunities to everyday Americans, through their retirement savings.

Within months, President Trump started dismantling rules dating back to 1974 that had largely kept 401(k) retirement savings — cousin of Canadian RRSPs — out of private equity and other private-market investments due to their high fees, risks and illiquidity.

Regulatory hurdles remain, but asset managers are already eyeing the $14 trillion in individual retirement savings plans, and preparing their pitch to retail investors with little experience of private markets. The promise of superior returns will crank up pressure for deals that extract value rather than create it.

Wanted: Guardrails

We still have runway and plenty of options, but no time to waste. We need swift action.

In my prebudget submission to the federal government, I propose a cost-free regulatory change that extends the scope and duration of the temporary foreign buyer ban on residential housing, in effect until Jan. 1, 2027. Currently this rule only covers family homes with up to three residential units in big cities. It could be expanded to include all multi-residential facilities, including retirement homes, group homes, and facilities that provide long-term care.

As I’ve documented in a forthcoming report, dozens of U.S. states have introduced safeguards for private investments in care, particularly health care. These range from greater public disclosure to more reviews and limited approvals of mergers and acquisitions, to bans of sale-leasebacks, to an outright moratorium on investment for some period. Another regulatory approach leans heavily on conditional funding, requiring certain staffing and workforce conditions in enterprises receiving public funding for services.

Canada isn’t starting from scratch. For example, the 2021 Canada-wide Early Learning and Child Care agreements prohibited growth in the for-profit share of the market. Some agreements also included wage floors and grids to improve recruitment and retention. Enforcement has relaxed but could easily be re-established. The model could also be extended to federal transfers for health care, home care, long-term care, mental health care and other care services. Public money should advance public goals and deliver better outcomes, not private profits.

The aim is simple: build Canadian assets, don’t just buy them. Assets aren’t only physical. They include the human capital that drives the economy. The terms we negotiate determine whether public or private interests prevail. But terms mean little without enforcement.

The details determine whether the deal creates value for Canadians or extracts it.

The investment invasion coming to Canada may have a polished look, but keep your eye on the price-tag. Whether it wears Prada or a $10,000 suit, the devil is always in the details.

Armine Yalnizyan is an economist and the Atkinson Fellow on the Future of Workers. Find her other columns for the Toronto Star here or follow her at armineyalnizyan@bluesky.com

https://www.thestar.com/opinion/contributors/to-save-canada-mark-carney-is-courting-foreign-money-he-s-risking-an-investment-invasion/article_61d8a9ed-6436-4da0-b5f9-46d0f091cfe4.html

Tags: economy, Health, ideology

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