Question Period Note: Disaster Financial Assistance Arrangements Modernization

• The Disaster Financial Assistance Arrangements program (DFAA) provides financial assistance when response and recovery costs exceed what individual provinces and territories could reasonably be expected to bear on their own.
• The Government of Canada publicly announced the modernized DFAA program on January 29, 2025, with the program coming into effect on April 1, 2025.

• For over 50 years, the Disaster Financial Assistance Arrangements program has played a critical role in supporting the costs of large-scale disasters caused by natural hazards in Canada.

• Public Safety Canada launched a modernized Disaster Financial Assistance Arrangements program on April 1, 2025.

• The modernized program is the culmination of over four years of extensive collaboration. Public Safety Canada continues to work closely with provinces and territories to ensure a smooth transition to the new Disaster Financial Assistance Arrangements.

• Our modernized Disaster Financial Assistance Arrangements prioritizes greater resilience and reduced disaster risks to Canadians. It empowers provinces and territories to develop tailored solutions, increased flexible funding and expanded post-disaster supports.

• This initiative will help to reduce the long term costs and impacts of disasters on all Canadians.

General— Disaster Financial Assistance Arrangements (DFAA) program
• Effective January 1, 2025, provinces or territories can request federal assistance when eligible expenditures surpass $3.84 per capita (based on the provincial or territorial population).
• The program outlines eligible costs for cost-sharing, including response, repairing essential personal property, restoring resilient public infrastructure, relief and recovery supports, and strategic mitigation.
• To ensure that assistance is provided in a consistent and equitable manner, the federal share is calculated using a set cost-sharing formula that ranges from 70-90% for provinces, and 80-100% for territories.

Program Modernization
• The most recent review of the DFAA took place from 2020-2023 and was the most comprehensive evaluation and review of the DFAA in its history.
• A Minister-appointed expert advisory panel on the DFAA published its final report Building Forward Together: Toward a more resilient Canada in April 2023.
• In Budget 2023, the government announced its intention to modernize the DFAA based on the review, with an emphasis on incentivizing mitigation and risk reduction.
• Public Safety Canada (PS) worked closely with provinces and territories (PTs) on modernizing the program. Engagement with PTs took place from spring 2023 to spring 2024.
Key Changes to the Modernized Program
• The new program prioritizes funding for improving recovery outcomes, increasing resilience to disasters, and reducing future risk. Key changes to the program include:
o A shift to an objectives-based approach where the program deploys a logical framework of 5 funding streams;
o Flexibility for PTs to design projects and/or assistance programs in their jurisdiction;
o Multiple avenues for PTs to access significant amounts of mitigation, risk reduction, and resilience funding that is more flexible and strategic;
o More opportunities to support people post-disaster.
• PS has launched a new centralized IM/IT solution that support PTs in program implementation and eliminate the old program’s paper-based system.
• PS is continuing to deliver training to PTs on the modernized program, and having now met with all jurisdictions except Nunavut. Open invitations to PTs for bilateral meetings, customized workshops and/or training sessions remain available.

Canadian Centre of Recovery Excellence
• The policy direction from Cabinet in 2022 called for the creation of a Canadian Centre of Recovery Excellence at Public Safety Canada to provide guidance and support to communities on how to incorporate risk reduction and resilience measures into disaster recovery so communities are safer and more resilient to future disasters.
• This Centre is a key resource for PTs in realizing the benefits of the modernized DFAA program by providing resources on effective recovery practices.

If Pressed
Q1- Why was the Disaster Financial Assistance Arrangements review undertaken?
• Since 1970, the Disaster Financial Assistance Arrangements (DFAA) has paid out more than $9.6 billion, with over 60% of these costs paid out in the last 10 years. The average disaster costs in Canada have also risen more than 1,250% since the creation of the program.
• In light of this rising frequency and severity of disasters in Canada, in 2021 the Minister of Emergency Preparedness was asked to undertake a comprehensive review of the DFAA and bring forward program amendments.
• The Minister also stood up an expert Advisory Panel in early 2022 to provide recommendations on how the DFAA could remain a relevant, effective and sustainable instrument for recovery, risk reduction, and resilience in the context of rising impacts of disasters.
Q2- How were provinces and territories engaged in the modernization process?
• Provincial and territorial (PT) partners have been actively engaged throughout the DFAA modernization process, contributing to policy development, program design, and multiple rounds of feedback. In 2023, the Canadian Council of Emergency Management Organizations recognized this engagement as an excellent model of collaborative consultation. The modernized program addresses 35 of 36 PT recommendations for the DFAA from 2021. Recent endorsements from Manitoba and the Northwest Territories further highlight the positive reception of these efforts.
Q3- If pressed on overall funding levels in the modernized Disaster Financial Assistance Arrangements?
• The modernized DFAA has a net increase in federal funding of approximately 3-5% per year.
• The previous program had a cost sharing range of 50-90%, with an average of 82%. The new program has a cost sharing range of 70-100%.
• The net increase in overall funding comes from the program’s significant increased funding for building back better, risk reduction, and strategic mitigation. Jurisdictions that choose not to build back better or mitigate their highest risks will leave federal funding on the table that is intended to increase the resiliency for the whole of society and, over time, to reduce the costs and impacts of future disasters for all levels of government.
• Estimates show that with full uptake of mitigation and resilience funding following a disaster, a subsequent disaster could be expected to cost 65% less.
Q4- If pressed on consulting provinces and territories on cost-sharing levels:
• Starting in spring 2023, multiple Federal, Provincial and Territorial (FPT) meetings and two Ministerial meetings (June 2023, Jan 2024) were briefed on the “New program format based on expense type (with highest cost sharing for reducing risk and supporting vulnerable people)”; no issues were raised.
• In fall 2023, PTs were given the draft program streams, which noted reconstruction would get “medium” cost-share, while response would get “higher”, supporting people and communities would get “highest”, and mitigation would be “variable”; clearly indicating a minimum of 3 different cost-share levels across the program. PTs did not raise issue with this approach during the feedback period, nor during the subsequent FPT Minister’s meeting in February 2024.
• Public Safety Canada (PS) provided the final cost-share percentages of the new program with PTs when it released the new Terms and Conditions in April 2024.
Q5- If pressed on wildfire coverage under the Disaster Financial Assistance Arrangements:
• The modernized DFAA covers costs for wildfires which directly threaten communities, also known as wildland urban interface fires.
• Under the modernized program, response costs; repairing, restoring and rebuilding uninsurable infrastructure (private dwellings/businesses are generally insured for fire damage); improvements to damaged infrastructure or new community or region-wide mitigation projects; and recovery supports like legal, financial, or mental health counselling can be cost shared under the DFAA to improve the resilience of communities that have suffered a disaster.
• With this new program, mitigation funding is available for any eligible disaster type under the DFAA. Therefore, a PT that suffers a disaster stemming from a natural hazard, such as a wildfire, and is eligible for DFAA funding, can use the DFAA to increase the resilience of the affected communities.
Q6 - Recent active events (One “question on” for each event)
• There are currently 89 active events under the DFAA, the most recent request for financial assistance coming from Newfoundland and Labrador.
• The province submitted a request for the storm surge in January 2025, and our government is working closely with provincial officials to promptly provide assistance to support the affected coastal communities.
• The Government of Canada is committed to working with provinces, territories and whole-of-society partners to prevent, respond to and recover from disasters.

Q7 – Jasper Recovery
• On September 19, 2024, the Province of Alberta requested financial assistance through the DFAA for costs incurred as a result of the 2024 fire disaster in Jasper.
• The estimated federal share is up to $57 million.
• In February 2025, Public Safety Canada provided the province an advance payment of $19.6 million to assist with early relief efforts and cover a portion of eligible wildfire response costs incurred.
• The Government of Canada and the Government of Alberta agreed to match donations from individual Canadians and corporations to the Canadian Red Cross (CRC) for the wildfire disaster relief and recovery efforts in the province. The CRC confirmed that $12.6 million in eligible donations were collected during the matching period, for a total of $38 million raised.