This article originally appeared in the Globe and Mail.
By Donald J. Savoie, July 22, 2025
The federal government recently announced an “ambitious” plan to cut spending: 7.5 per cent in year one, 10 per cent in year two and 15 per cent in year three, but only on selected activities. The onus is on departments and agencies to come forward with suggested cuts. Nothing new here. Pierre Trudeau, Jean Chrétien, Stephen Harper and Justin Trudeau all tried this approach. Some were successful, notably Mr. Chrétien and his 1994-1996 program review, and others were not, including Justin Trudeau and his 2023 plan to cut spending.
Prime ministers revert to cuts from above because they see it as the most promising way to reduce spending. Ministers and departments are not in the habit of offering cuts on their own. They are there to ask for more resources, not fewer. Cuts from above only work, however, when prime ministers do not allow end-runs by ministers and departments to plead their case directly before them. Mr. Chrétien never tolerated it, which explains in large part his success in the 1994-1996 review.
The approach is also not without problems. Regional and local officers delivering programs and services usually bear the brunt of the cuts, as departments try to squeeze spending down to the required percentage point. This explains why the percentage of federal public servants working in the National Capital Region went from 26 per cent in the 1970s to 43 per cent today. It is easier for senior departmental officials, virtually all of them in the NCR, to cut someone in far away Moose Jaw, Sask., than someone that they may meet going up in the elevator in downtown Ottawa. The real estate market in the NCR is also more important to them than the ones in say, Corner Brook, N.L., or Winnipeg.
The Ottawa-based bureaucracy is loaded with policy and program evaluation units. One would think that they are always at the ready to identify which programs are failing and those that are long past their best-by date. Program evaluation units, found in all government departments and most agencies, have been missing in action, unwilling or unable to report that programs fail to deliver what they promise, for fear of casting the government in a negative light.
The units report to the government, not Parliament, as they deal with access to information legislation and other transparency requirements. No minister wants to stand before the House of Commons or the media to explain why departmental programs are missing the mark or should be eliminated. Whatever the reason, the units are still kept busy turning a crank not attached to anything.
Instead of announcing reduction targets from above that generate countless meetings with the objective of identifying possible cuts that stand to cause minimal damage to departments, the Cabinet could go with a different approach, one that would have a longer lasting impact. The government could, for example, eliminate two management layers. There are, at the moment, anywhere between six and nine management layers in the federal government, which are costly, slow down decision making and, all too often, generate non-productive work. The Treasury Board could also eliminate 90 per cent of “associate” positions attached to senior management jobs, which have mushroomed in recent years, in part to get around wage freezes or to award promotions that would not otherwise exist.
The federal government is home to hundreds of organizations and programs. Rather than try to shave a 7.5-, 10- or 15-per-cent cut to existing spending with uncertain success, Cabinet should review all organizations and all programs to see which ones no longer meet expectations or could be eliminated with limited impact on Canadians.
Government organizations and programs are the product of political decisions and it is incumbent on Cabinet to decide whether they should continue. The exercise would enable Cabinet ministers to ask pointed questions about government programs and operations. Decisions to establish and eliminate organizations and programs belong to politicians, and not to anyone else. If the goal is to restructure the expenditure budget, this is where they need to look.
The Carney government has unveiled new spending commitments to strengthen the national economy, soften the blow of U.S. tariffs and boost defence spending. Mr. Carney’s planned cuts will not generate the required savings to support the various new spending commitments. The government can increase taxes, such as the HST, or it can take a close look at its organizations and programs and decide which ones still square with its policy agenda. This calls for a genuine political review of programs, not a process of trying to shave spending on selected activities which, history shows, only offers temporary savings.
Donald J. Savoie is the author of Speaking Truth To Canadians About Their Public Service and a distinguished fellow at the Macdonald-Laurier Institute.
