Toronto-Quebec City high-speed rail: why the budget officer's building estimate is higher than Alto's

Parliamentary Budget Officer Annette Ryan estimates construction of a dedicated Toronto-to-Quebec City high-speed line at $75 billion to $113 billion.

That range covers civil works and related capital for new track only. It does not include operating the service, maintaining the line or buying the trains.

Alto, the federal Crown corporation responsible for the project, estimates construction at $60 billion to $90 billion. Alto says its range is preliminary and will be refined and updated next year. The Globe and Mail Both ranges cover building only. The PBO says whether ticket revenue will cover operating costs will be addressed in a future report.

The PBO analysis builds its estimate from per-kilometre construction costs on high-speed lines in other countries. It is titled "Canada's Eastern Corridor High-Speed Rail: A Cost Analysis using Global Data" and was published Oct. 1, 2026, in response to a request from the Standing Senate Committee on National Finance. The $75-billion to $113-billion range covers the baseline Alto Eastern Corridor route and excludes a potential Kingston amendment. It assumes planning and regulatory approvals proceed much as they have on past European projects. PBO

Projects in the United Kingdom and the United States cost much more per kilometre, the PBO notes, likely reflecting land acquisition, permitting, litigation, design changes and project-management problems. It notes Ottawa has adopted recent federal legislation meant to limit that kind of cost growth in Canada. The main estimate uses European unit costs. The British and American experience shows how high the bill could go.

The two estimates also use different lengths. Alto describes the project as 1,000 kilometres. The PBO analysis uses 850 kilometres. The final route is not set. The government has not decided whether the Peterborough, Ont., to Ottawa segment will run north through the Canadian Shield, with its hard rock and thin soils, or south near Kingston. The PBO flags a planned 15-kilometre tunnel under Mount Royal linking Laval and downtown Montreal as carrying a high risk of overruns.

Alto expects ridership of 24 million passengers a year by 2055 and up to 43 million by 2084. That calls for sustained growth from the current base. Alto says Via Rail ridership declined from 8 million a year in the 1980s to about 4.4 million in 2025.

A 2023 internal report estimated operating and maintaining the line at $62.6 billion to $67 billion over 40 years, on top of construction. The same report put the full 40-year price tag, including construction, operations and trains, at about $150 billion, against $105 billion in projected revenue over 40 years. Those figures predate the current PBO and Alto construction ranges and will be tested in the PBO's forthcoming paper on operations.

For the initial Ottawa-Montreal segment, the PBO estimates construction would add about $1.8 billion to real GDP, adjusted for inflation, in 2029 and $2.0 billion in 2033 a year, and raise employment from about 4,300 to 9,000 jobs during construction. An international consortium won a C$3.9-billion contract for the Quebec City-to-Toronto network, according to reporting in February 2025. Reuters In the 2024-25 Main Estimates, the spending plan tabled in Parliament, Transport Canada listed about $122 million in planned spending authority for High Speed Rail. Alto lists potential benefits as travel time savings, lower transportation costs, reduced congestion and improved road safety.

The broader context here is fiscal exposure and staging for Ottawa and the provinces. A corridor project of this scale touches federal procurement, environmental assessment, Quebec and Ontario land use and transit integration, and municipal access in Toronto, Ottawa and Montreal. Building Ottawa-Montreal first limits near-term spending while keeping the Toronto-Quebec City commitment. It also concentrates early tunnelling and Shield-geology risk in the segments where unit costs are least firm.

In my view, the three numbers to watch are Alto's refined capital range next year, the PBO operating-cost and farebox paper, and the Peterborough-Ottawa alignment decision. Together they will determine whether the project can proceed as a phased intercity program within existing fiscal frameworks or needs a revised funding and risk-sharing structure with private partners and the two central provinces.