Indigenous programs face more than $2 billion in budget cuts, but are being spared the worst of government spending reductions proposed by Ottawa in Mark Carney’s first budget as prime minister.
The Liberal minority government’s 2025 spending plan, tabled Tuesday afternoon in the House of Commons, would cut budgets by two per cent in both Indigenous Services Canada and Crown-Indigenous Relations and Northern Affairs Canada, resulting in a total cut of nearly $2.3 billion by spring 2030.
That’s much less than initially suggested in July.when ISC warned internally of “difficult decisions” ahead, heading for a reduction of up to 15 per cent over three years.
Meanwhile, in new money, Ottawa is pledging $2.3 billion over three years for First Nations drinking water, and $10.1 million over three years for Indigenous consultation on major projects being fast-tracked through the regulatory process.
But new money for Indigenous-specific programs mostly stops there. While Finance Minister François-Philippe Champagne promised “generational investment” before releasing the budget, the actual plan is much more discreet when it comes to indigenous issues.
“The government remains committed to reconciliation. Crown-Indigenous Relations and Northern Affairs Canada and Indigenous Services Canada offer important programs that are legally or constitutionally required,” the document reads.
“The government will review how these organizations can implement these programs more efficiently, with a savings target of two per cent.”
Champagne suggested to reporters Tuesday that the Liberals are trying to strike a balance.
“We’ve been able to deliver savings while protecting what’s important to the Canadian people,” he said.
While the cuts are not as big as they could have been, the Liberals are still not offering the kind of major cash injection Indigenous leaders were hoping for to close an estimated $425 billion infrastructure gap in their communities.
The budget also suggests Carney’s Liberals are building to some extent on the Trudeau government’s previous spending promises as money continues to flow out.
The budget, for example, indicates that “it is being confirmed” that there are 2.8 billion dollars available of the 4.3 billion dollars initially promised in 2022 for urban, rural and northern indigenous housing, meaning that program has not been cut.
While it doesn’t include any money attached, a chapter on “promoting Indigenous tax jurisdiction” promises to reach fuel, alcohol, cannabis, tobacco and vaping tax deals with interested Indigenous governments.
Concern about expiring programs
In other policy areas, some Indigenous advocates worried that expired programs would not be renewed, and so far this budget offers little comfort.
A spokesperson for the Ontario Federation of Indigenous Friendship Centers said the ISC told the group to expect cuts when Urban Programming for Indigenous Peoples expires in March 2026.
“We are very concerned about that because the program provides core operating funding and therefore could mean the risk that friendship centers will not receive support to keep their doors open,” CEO Sean Longboat said in an interview before the budget was released.
Urban programming for Indigenous peoples received a $34 million supplement this fiscal year, according to the budget. Specific Indigenous programs that will suffer budget cuts have not been identified.
Indigenous peoples are also eligible for cash through initiatives promoted elsewhere, such as an Arctic Infrastructure Fund that will receive $1 billion over four years for major transportation projects with dual-use civil and military applications, including airports, seaports and highways.
To reduce bureaucracy and “speed up regulatory processes in northern Canada,” the budget promises $25.5 million over four years for CIRNAC and $41.7 million over four years for the Canada Northern Economic Development Agency.
Indigenous groups would also be eligible for a new Building Strong Communities Fund, which promises $51 billion over 10 years. Inuit University Nunangat and the Lac La Ronge Indian Band’s Kitsaki Hall in Saskatchewan were mentioned among the initial projects Ottawa is supporting.
The Liberal minority needs three votes from the main opposition parties for the budget to be approved in the House of Commons and, if they do not get that support, winter elections could be held.
