Budget 2025: Federal Public Service Job Cuts and Spending Review
Approximately 16,000 federal public servants are expected to lose their jobs over the next four years due to the Liberal government’s spending review. The budget released on Tuesday outlines departmental plans to save a combined $13 billion annually by 2028-29.
Early Retirement Incentive Program
In preparation for these reductions, Ottawa is introducing an early retirement incentive aimed at employees aged 50 or older with over 10 years of service. This program allows eligible employees to retire early without penalties.
Public Service Workforce Reduction
The federal public service will undergo a major overhaul, including a reduction of 40,000 full-time positions by 2028-29. Nearly half of these cuts will result from the government’s internal savings initiatives.
“We are modernizing government operations to deliver better results for Canadians and reduce costs,” states the budget. “To meet the moment, we must reinvent government to be fit for the 21st century. This means recalibrating activities and fiscal room towards our core mandates — spending less on the day-to-day running of government.”
Projected Workforce and Cost Trends
Despite these planned cuts, the Parliamentary Budget Officer notes that staff costs are projected to rise by $7 billion by 2029-30 without these spending reductions. The federal workforce has grown steadily since the Liberals took office in 2015, reaching nearly 369,000 full-time positions in 2023-24.
Summary
The federal government is tackling rising costs with a significant reduction in public service jobs and a restructuring aimed at modernizing operations and prioritizing core functions.
Would you like me to provide a more detailed breakdown of the budget measures?