The federal government is expected to table its next budget on November 4, against the backdrop of a comprehensive expenditure review proposing the deepest cuts to the federal public service in generations.
These reductions – expected to be announced or deepened in this budget – come on top of hiring freezes, delayed replacements, and program slowdowns already underway across departments. Framed as “discipline” and “efficiency,” the cuts risk hollowing out the very systems Canadians rely on: from food safety to emergency response to digital security.
Here are five red flags to watch for in Budget 2025 – and why they matter for Canada’s future.
1. “Efficiency” language that hides real cuts
When governments talk about “program reviews,” “attrition,” or “streamlining,” they want Canadians to picture cutting red tape – not fewer food inspections, slower responses to wildfires, or weaker disease monitoring.
The truth is, when government cuts go too deep, it’s not inefficiency that’s eliminated – it’s the people and services that Canadians rely on, often without realizing it.
Reducing the size of the public service workforce won’t magically create operational efficiencies, just like replacing the Phoenix pay system with different software didn't magically fix the government’s inability to pay its employees correctly or on time.
Public service professionals know where the issues are – poor planning, outdated systems, costly outsourcing, and layers of management that make it hard to get anything done – and are ready to be part of the solution.
2. Artificial Intelligence as a “quick fix” with long-term consequences
We all want the government to innovate. But when “AI-driven efficiency” becomes code for replacing people instead of enhancing services and jobs, Canadians lose out: broken systems, wasted money, and public harm.
Automating decisions about benefits, inspections, or compliance without proper oversight risks errors and inequities. Responsible AI means publicly built, transparent AI systems guided by professionals, not privatized tools developed by multinational vendors with no accountability.
If the government wants to make technology work for Canadians, it must invest in public capacity to design, test, and govern these tools. It cannot use AI as a “quick fix” cover to justify cuts that damage the quality of public services Canadians rely on.
3. An increase in costly outsourcing
While the government speaks about efficiency and discipline, it has become overly dependent on wasteful and unnecessary outsourcing. Outsourcing on professional services is projected to hit a record $26 billion this fiscal year – the highest on record. That’s money flowing to private consultants instead of building the in-house capacity Canadians actually need.
This unchecked growth carries a big cost, exposing taxpayers to runaway budgets and minimal accountability. The Parliamentary Budget Officer has shown that contractors cost 22–25.7% more compared to equivalent in-house professionals. This practice is unacceptable for a government that’s trying to find savings and reduce inefficiency while cutting full-time public sector jobs. If the federal government wants real savings, reducing outsourcing is the place to start.
4. Neglecting science and evidence
From tracking wildfires to testing clean water, public scientists are essential to keeping Canadians safe. But after years of under-investment, many departments are already stretched to the breaking point.
Any further cuts could jeopardize Canada’s readiness for health emergencies, environmental monitoring, and food safety. Persistent issues – like political interference, inadequate staffing, and barriers to open communication – remain unaddressed in many departments.
Protecting science means stable funding, modern labs, and freedom to share research findings — not another round of restrictions or silence.
For more, see our latest report on the state of federal science and why renewed investment is critical to Canada’s resilience.
5. Forgetting the bigger picture
As economist Jim Stanford of the Centre for Future Work reminds us, this is “not an ordinary federal budget.” This is the moment to defend what keeps Canada strong and independent – not dismantle it.
Public servants are Canada’s first line of defence against risk – tracking wildfires, ensuring safe food and medicine, securing our digital systems, and keeping the economy steady when crisis hits. Investing in them means investing in a safer, more self-reliant Canada.
What Canadians actually need
- Strengthen the public service without deep cuts
- Rein in wasteful outsourcing and rebuild internal expertise
- Adopt AI responsibly
- Reinvest in evidence-based decision making and scientific integrity
- Focus on long-term problem solving, not band-aid solutions
Public servants are part of the solution: they know where improvements can be made. What they need is support to do their jobs, not slogans about doing “more with less.”
Cutting won’t build resilience. Strengthening public services will.