'Worst cuts to the public service in modern history' could be on the horizon, says report

Ottawa Citizen

30-06-2025

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Prime Minister Mark Carney's promise to balance his government's operating budget could lead to the 'worst spending cuts in modern history,' says a new report by a left-leaning think tank.
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The Canadian Centre for Policy Alternatives report analyzed Carney's campaign pledge to balance the operating budget through a promised $13 billion in 'productivity' savings.
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In the report, economist David Macdonald found that if Carney follows through with these promises, cuts could amount to around 24 per cent across the federal public service.
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'These are deep service cuts. I mean, this is you calling CRA and nobody picks up the phone, you're trying to get a passport and there's no one there to renew it,' Macdonald said in an interview.
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The report echoed comments from Parliamentary Budget Officer Yves Giroux, who recently told the Ottawa Citizen that Carney's plans could require 'severe cuts to the public service, significant cuts.'
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During the federal election, Carney also promised that he would cap, but not cut the size of the public service. Observers question whether that will be possible with the rest of Carney's fiscal promises.
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In his analysis, Macdonald excluded the Department of National Defence, as the government's new defence spending commitments 'likely exempts this department from cuts, even though it makes up 28 per cent of operational spending.'
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Macdonald's analysis found that if realized, Carney's promises would amount to cuts worse than former prime minister Stephen Harper's Deficit Reduction Action Plan and would 'rival' the cuts conducted of Paul Martin and Jean Chrétien's program reviews in the 1990s.
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In 2012, Harper's Deficit Reduction Action Plan, or DRAP, saw around a 10 per cent reduction in the size of the public service. The program reviews of Chrétien and Martin saw a reduction of around 20 per cent.
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The report pointed to a line item in the Liberal platform that would save $28 billion over three years due to 'savings from increased government productivity.'
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In his analysis, Macdonald said the spending cut needed to balance the $89-billion operating budget (excluding DND) would amount to a $13-billion spending cut.