Natural Resources Minister Joe Oliver, a former Bay Street investment banker, will become the federal government's new finance minister after Jim Flaherty announced his resignation from cabinet, sources said.
With the loss of the long-serving Mr. Flaherty, Prime Minister Stephen Harper wants to send calming signals to financial markets, and Mr. Oliver's experience qualifies him. Mr. Oliver moved directly to the Conservative front bench from Bay Street when he first won his seat in the north Toronto riding of Eglinton-Lawrence in May, 2011. The 73-year-old MP has signalled his intention to run again in 2015, but has no leadership ambitions and has shown himself to be a good soldier.
In his three years in cabinet, Mr. Oliver became one of the Conservative government's most well-traveled ministers, zig-zagging the globe preaching the virtues of Canada's energy sector as opposition to it, and the oil sands in particular, surged. With energy projects such as the Keystone XL pipeline hanging in the balance, Mr. Oliver became a familiar face, an unabashed champion of the energy sector.
He is said to work tirelessly and shoots often from the hip, but Mr. Oliver is by and large a reliable Conservative figure who stumps the party line, even when partisan barbs raise eyebrows – such as referring, in writing, to "environmental and other radical groups" that oppose the energy sector.
Armed with a master of business administration from Harvard University, the bilingual Montreal native spent years working as an investment banker with Merrill Lynch brokerage before taking the reins as executive director of the Ontario Securities Commission. He then served as chief executive of the Investment Dealers Association of Canada, a lobby group and self-regulating body for the securities industry.
The change of the guard in the finance portfolio will trigger a minor cabinet shuffle, sources said.
Mr. Oliver is the oldest member of Mr. Harper's cabinet – he will be 74 in May and had heart surgery last year, although he has resumed his hectic pace and plans to seek re-election.
Mr. Harper was forced to replace the only finance minister he has ever had after Mr. Flaherty announced his resignation on Tuesday. Though Mr. Flaherty's future had been the subject of speculation for months, his resignation came as a surprise.
Since coming to office in 2006, Mr. Flaherty and Mr. Harper crafted budgets that set the overall tone for a government message that has been almost exclusively focused on economic themes.
Their original economic plans were derailed by the deep recession of late 2008. It forced the two men to approve major stimulus spending, leading to at least six straight years of deficits. But the government's underlying fiscal restraint has won it plaudits from global observers such as the International Monetary Fund.
The billions Ottawa spent on temporary stimulus spending masked the fact that year by year through longer-term spending cuts, the size of the federal government will have shrunk to its smallest size in more than 50 years.
The next finance minister faces a slow-growing economy, but with an expected surplus. For the first time since the recession, the Conservatives will have money to spend in their next budget, as Mr. Flaherty's 2014 budget forecasts cumulative surpluses of at least $33-billion over the coming four years.
Mr. Oliver will also need to take on the opposition NDP and Liberals, two parties that are honing their economic messages with calls for a more interventionist federal government aimed at helping the middle class and boosting infrastructure spending.
Mr. Flaherty made the decision to resign official on Monday during a private meeting with Mr. Harper. The news was made public Tuesday afternoon via written statements from Mr. Flaherty and Mr. Harper.
"In my time as Finance Minister, I am proud of the work I have done to help manage the deepest economic challenge to face Canada since the depression of the 1930s and ensure Canada emerged stronger and as a recognized economic leader on the international stage," said Mr. Flaherty, 64, in a statement.
Mr. Flaherty's future has been the subject of speculation for months. He has been battling a painful skin condition and often appeared to be in discomfort. But in his statement, Mr. Flaherty said the decision was not related to his health.
Mr. Flaherty did not immediately resign as an MP, but indicated he is planning a return to the private sector.