Question Period Note: Cost of Departmental Dissolution

The dissolution of Indigenous and Northern Affairs Canada was the right thing to do.
The dissolution was completed with the coming into force the Department of Crown-Indigenous Relations and Northern Affairs Act and the Department of Indigenous Services Act on July 15th, 2019.
These two new departments allows us to break from the colonial past and to better serve the distinct needs of First Nations, Inuit and Métis while accelerating a move towards self-determination.
There has not been any significant additional increases in the administrative costs of either department as a result of the creation of the departments.

From Transition book: Impact of the Dissolution of Indigenous and Nothern Affairs Canada:

Subsequent to the announcement of the dissolution of Indigenous and Northern Affairs Canada and the establishment of Crown-Indigenous Relations and Northern Affairs Canada and Indigenous Services Canada, units supporting the specific mandates of the new departments were transferred between them.
As part of the establishment of both departments, a shared service model was established where some corporate level activities are shared between them, including Human Resources and Communications functions.

From DM's Enabling Leg Briefing book: Costs related to the creation of the two departments:

As was stipulated in the Budget, the departments were provided with additional funding of $117 million over a period of three years with an ongoing component of $19 million. From the additional funding, $59.7 million was attributed to the set-up and transition costs to create separate departments and the integration of the First Nations and Inuit Health Branch from Health Canada into ISC. Factoring this additional funding, the internal services costs for CIRNAC and ISC will still be smaller as a percentage of overall funding in comparison to the equivalent percentage for Indigenous and Northern Affairs Canada, at the time of the machinery of government announcement.

As such, the administrative cost for both departments’ internal services (such as management and oversight (Minister and Deputy Ministers’ offices), finance, procurement and material management, accommodations, security, human resources, information management, information technology, audit and evaluation and real property services) have seen a decrease in this area compared to the overall departmental budgets.

On the date of the establishment of the two new departments:
• There were approximately 2700 FTEs in CIRNAC
• There were approximately 4950 FTEs (2260 from INAC and 2690 from HC) in ISC

By November 2019

Employee Headcount by Department – November 2019

CIRNAC: 1378 (NCR), 581 (Region), 1959 (Total)
ISC: 2377 (NCR), 3979 (Region), 6356 (Total)

If pressed

A shared service model was developed when we established both departments, which has ensured that costs have not significantly increased for these corporate services.
The overall increased spending through Budget 2019 is being invested to close the unacceptable socio-economic gaps that exists and to advance reconciliation with Indigenous Peoples in Canada.
Further, the increase in the number of FTEs since the announcement of the creation of the departments is mostly due to new investments in programs and direct services, not to increases to internal services.