Federal union warns government ‘widening the net’ to reduce spending

A federal public sector union is warning the Liberal government’s plans to reduce government spending will cut public service jobs, saying “you can’t find billions in cuts without slashing the important services people depend on.”

The Public Service Alliance of Canada says the government held a briefing with unions on Thursday to discuss the ‘Refocusing Government Spending Initiative.”  PSAC says, “without prior consultation, the government unilaterally announced their plans to cut costs across the federal public service.”

“We’ve seen this horror movie before –– and it always ends badly for families across the country,” Sharon DeSousa, PSAC national president, said in a statement.

“Make no mistake – everyday people always pay the price when public services are cut.”

Federal departments received letters on Oct. 31 from Treasury Board President Anita Anand asking staff to “carefully review” spending to identify operations that could be streamlined or business processes that could be reengineered to provide “better value for money,” according to the minister’s office.

The 2023 federal budget included a plan to find $15.4 billion in public sector spending reductions over five years, and the 2023 fall fiscal update included a pledge to “extend and expand” efforts to refocus government spending by $345.6 million in 2025-26, and $691 million a year from 2026-27 onward. In April, the government announced plans to reduce 5,000 public service jobs through attrition over four years.

The Treasury Board of Canada Secretariat would not provide savings targets for each department to CTV News Ottawa, but said savings would “only be drawn from operating budgets and through natural attrition, to the greatest extent possible.” 

In a media release titled “Canada’s public services at risk,” PSAC says the government is “widening the net, looking to cut term and casual employees, and opening the door for departments to slash permanent employees through Workforce Adjustment.”

“Federal departments have been assigned specific budget reduction targets in salary line items. PSAC is insisting that unions must be consulted while these targets are reviewed,” the union said in a statement.

“These targets, protected under Cabinet privilege, will remain confidential until they are made public in June 2025.”

According to the Treasury Board of Canada Secretariat, there are 376,772 federal public service workers, up from 357,247 in 2023. A total of 282,152 employees work in the core public administration.

“Workers and families are waiting in limbo. People who benefit from critical programs won’t know if the services they depend on will be cut,” DeSousa said. “Public service workers won’t know if they’ll have jobs by next summer – if they can renew their mortgage, start a family or pay their student loans.”

PSAC is calling on the federal government to find savings on contracting out public services and through “the massive savings remote work offers for Canada’s public service.”

The Professional Institute of the Public Service of Canada is also raising concerns about the government’s spending review, saying there has been a “lack of consultation” and an “apparent lack of preparation” by the Treasury Board Secretariat.

“We expect genuine engagement with our members and consultation at the departmental level,”  Jennifer Carr, PIPSC president, said in a statement.

“Without this, we risk seeing the same type of blanket cuts we saw during the Harper era—which had a detrimental impact on the programs and services Canadians rely on.”

PIPSC says the federal government’s promise that any spending reductions will not affect services “rings hollow when we consider the reality of attrition.”

“Every position left unfilled represents real work not being done and real services not being delivered to Canadians,” Carr said. “Every vacant position means fewer people doing the same amount of work—or more. Burnout among our members is an inevitable outcome of this approach.”

As of September, all federal employees in the core public service are required to be in the office a minimum of three days a week, while executives must be in the office four days a week.

A spokesperson for Anand says the second phase of refocusing government spending plan directed departments to identify operating cost savings totalling $4.2 billion from 2025-26 to 2028-29, and $1.3 billion ongoing.

“These savings are expected to be drawn from operating budgets and through natural attrition to the greatest extent possible,” Myah Tomasi, press secretary for the Office of the President of the Treasury Board, said in a statement to CTV News Ottawa. “This must be done without impacting programs and services that benefit Canadians and in a way that continues to support a diverse public service workforce.”

Federal departments received letters on Oct. 31 outlining the directions to find savings. Tomasi says the minister has been “very clear with all departments” to focus on finding savings without layoffs.

“In the letters sent to her colleagues, Minister Anand specifically reiterated that they must carefully review their organization’s spending to identify operations that could be streamlined, or business processes that could be reengineered, including by leveraging artificial intelligence technologies, to provide better value for money,” Tomasi said.

“Additionally, in developing proposals, they must keep in mind the importance of not negatively impacting the delivery of benefits to Canadians and supporting regional representation and a diverse public service workforce.”

The Treasury Board of Canada Secretariat says the federal government is looking to reduce spending without impacting programs and services.

“Savings will only be drawn from operating budgets and through natural attrition, to the greatest extent possible, without impacting programs and services that benefit Canadians and in a way that continues to support regional representation and a diverse public service workforce,” said a statement Friday afternoon.

“Organizations are in the process of developing proposals to meet their specific savings targets and approved savings amounts will be presented in the 2025-26 Main Estimates and departmental plans. To respect cabinet confidence and the integrity of the process, we are not providing departmental savings targets.”

With files from CTV News Ottawa’s Ted Raymond