OTTAWA — The federal government is planning to cut more than 12,000 full-time equivalent positions over the next three years as part of a major spending review aimed at reducing costs and improving efficiency across departments.
The planned reductions, outlined in departmental reports for the 2026–27 fiscal year, are part of the government’s broader effort to save billions in public spending. These job cuts will come from multiple departments, with some of the largest reductions expected at Public Services and Procurement Canada (1,793 positions), Statistics Canada (900 jobs) and Health Canada (942 jobs).
Officials say departments were instructed to identify savings through program reductions, operational efficiencies and restructuring. While some departments provided detailed plans, others offered only general commitments to “streamline” services or “modernize” operations, leaving uncertainty about the full impact on public services.
Several agencies have already identified specific measures. The Canadian Space Agency plans to cancel its LEAP Lunar Rover Mission, while the Canada Revenue Agency is shutting down units tied to programs no longer aligned with government priorities, including those related to the digital services tax. The Canadian Food Inspection Agency is reducing non-core research and consolidating lab services, while Environment and Climate Change Canada is scaling back the Low Carbon Economy Fund.
The Department of National Defence and the Canadian Armed Forces are also planning to retire aging equipment fleets and dispose of surplus properties to reduce costs. Meanwhile, Library and Archives Canada will cut back access-to-information functions and eliminate certain heritage funding programs.
Across government, departments such as Shared Services Canada and the Department of Justice are also looking to increase the use of artificial intelligence to improve efficiency and service delivery.
Experts say the current plans provide only a broad outline of what’s to come. Former Institute on Governance CEO David McLaughlin noted that while there is some transparency, the real impact on services and communities will only become clear through parliamentary review and committee hearings.
Opposition critics have raised concerns about the lack of detailed plans. Conservative MP Stephanie Kusie said the reports do not clearly explain how departments will achieve the cuts, calling the approach unclear and worrying from a transparency standpoint.
Labour groups have also voiced strong opposition. The Public Service Alliance of Canada warned that the cuts could weaken essential programs and services relied upon by Canadians, arguing the move is not about efficiency but a reduction in public sector capacity.
The government maintains that departments were directed to focus on eliminating underperforming or overlapping programs, though the full effects of the cuts on services, regions and workers remain uncertain and are expected to become clearer in the months ahead.