Federal public service could shrink by almost 60,000 jobs, report predicts

A new report by the Canadian Centre for Policy Alternatives says the federal public service could shed almost 60,000 jobs over the next four years as Ottawa looks to cut costs.

Earlier this month, Finance Minister François-Philippe Champagne sent letters to multiple ministers asking them to cut program spending at their departments by 7.5% next spring, 10% the year after and 15% in 2028-29.

The report, written by senior economist with the Canadian Centre for Policy Alternatives David Macdonald, says the federal public service could lose up to 57,000 employees by 2028.

The report predicts that tens of thousands of jobs will be cut at the Canada Revenue Agency, Employment and Social Development and Immigration, Refugees and Citizenship Canada — three federal bodies that already have seen a drop in employees in recent months.

The report says the cities of Ottawa and Gatineau will likely “bear the brunt” of the cuts because almost half of the job losses will be in the National Capital Region.

The report predicts service impacts will be felt across the country and the cuts will mean longer wait times, more errors and “fewer people to fix those errors.”

The report says the government is asking departments to find savings to help cover major military spending increases and tax cuts. It says the Department of Defence, the RCMP, the Canada Border Services Agency, the Supreme Court and the Parliamentary Budget Office are “protected departments” and need to plan for a smaller 2% cut.

The Canadian Press has reached out to the Treasury Board of Canada Secretariat for confirmation of those departments’ protected status but has not yet received a response.

The report suggests ministers have some flexibility in choosing where the cuts will land.

“For instance, a department may propose to cut fewer than 15% of their staff, but that means other budget items will have to be cut by more than 15% to make up the difference,” it says.

In an earlier report, Macdonald said there could also be cuts to things like transfers to First Nations governments, supports for veterans and newcomers, international aid and research.

Prime Minister Mark Carney campaigned in the spring election on a promise to “cap” but not cut public service employment. He also promised to launch a “comprehensive review” of government spending to increase productivity.

In an email, Macdonald said Carney’s campaign promise not to cut the public service “never made sense.”

He said operational expenditures are already “capped” at about $130 billion a year and that “it always had to be cuts.”

“In the campaign, they were targeting staffing (and) other operational spending,” Macdonald said in the email.

“But this expanded substantially to include departmental transfers in July, probably to pay for the massive new defence spending that happened just weeks after the election (and weren’t in the platform or certainly not that quickly).”

Macdonald said the government likely will offer buyouts to older employees to encourage more retirements. He also said cuts will likely involve “the end of all term and casual employment.”

“These are going to tend to be younger workers who aren’t yet indeterminate,” he said. “Then it will be indeterminates that will go through workforce adjustment that may end in layoffs.”

Nathan Prier, president of the Canadian Association of Professional Employees, said the union is very concerned by what it calls the “broken promise” not to cut the federal public service.

He said departments are now being told to find savings that could amount to a “drastic reduction in the quality of public services that Canadians rely on …”

“Canadians were hoping with their choice last election that as a country we’d stand up to threats from (U.S. President Donald Trump), make strategic investments in our economy and diversify our trading partners, and to do that we need a strong federal public service,” Prier said.

The Carney government’s cuts follow previous cuts introduced in Budget 2023 under the “refocusing government spending” initiative. The report said those cuts are already affecting staffing levels and that their “savings” will hit their peak impact in 2026-27.

The federal public service shrunk by almost 10,000 people last year, with the number of public servants employed by the federal government falling from 367,772 to 357,965.