Question Period Note: Responsible Government Spending (Government- wide & TBS-specific)

What has the government done to reduce spending as committed to in the 2023 and 2024 Budgets?

• The Government is making sure that spending is being carefully managed and focussed on our most pressing priorities.
• This work began in 2023-2024 with departments cutting spending on travel and professional services by $500 million.
• In 2024-2025, $2.3 billion was reallocated to priority areas, and this year (2025-26) that amount increases to $3.5 billion.
• We will continue to review our spending to make sure we are being efficient, effective and focussed on meeting the challenges and opportunities Canada faces.
If Pressed on TBS Savings:

• $9.6 million was reallocated from TBS’ budget in 2024-25. That amount will rise to $12.1 million in 2025-26 and then to
$15.5 million in 2026-27 and future years.

Budget 2023 proposed two measures to refocus government spending:

• Reduce spending on professional services, travel and operations
• Phase in a roughly 3 per cent reduction of eligible spending by departments and agencies by 2026-27. Comparable reductions were applied to Crown Corporations.

The 2023 Fall Economic Statements announced plans to extend and expand the Budget 2023 measures, with departments and agencies generating additional savings of $345.6 million in 2025-26, and $691 million ongoing. Combined with the $15.4 billion in refocused spending outlined in Budget 2023, implementation of these measures would save $4.8 billion per year in 2026-27 and ongoing and return the public service closer to its pre-pandemic growth track.
Information on the first phase of the refocusing results has been reported through the 2024-25 Estimates documents:
• $500 million for 2023–24 (shown in Supplementary Estimates (B), 2023–24) based on travel and professional services spending;
• $10.5 billion over 3 fiscal years (2024-25 to 2026-27) shown in Main Estimates 2024-25; and
Additional information was included in Departmental Plans.
Budget 2024 announced the implementation of Phase 2 of the Refocusing Government Spending (RGS) initiative.
RGS2 would have achieved the remaining savings of $4.2 billion over four years, starting in 2025-26 and $1.3 billion ongoing toward the overall refocusing government spending target. This covers the $1.8 billion shortfall from RGS1 and the RGS2 target announced in the FES 2023. However, RGS2 was suspended because of the prorogation of Parliament. Whether and how the government pursues those RGS2 targets remains to be determined.

Planned reallocations through the estimates (millions)
• Phase 1: Total spending refocused to date
o 2023-24: 500
o 2024-25: 2,251
o 2025-26: 2,800
o 2026-27: 3,610
o 2027-28: 3,613
o 5-year total: 12,774
o Ongoing: 3,498
• Phase 1: Additional reallocations through Responsible Government Spending
o 2023-24: -
o 2024-25: -
o 2025-26: 315
o 2026-27: 521
o 2027-28: 478
o 5-year total: 1,728
o Ongoing: 593
• Phase 2: Responsible Government Spending announced in the 2023 Fall Economic Statement
o 2023-24: -
o 2024-25: -
o 2025-26: 346
o 2026-27: 691
o 2027-28: 691
o 5-year total: 1, 728
o Ongoing: 691
• Total Planned Reallocation through the Estimates
o 2023-24: 500
o 2024-25: 2,251
o 2025-26: 3,460
o 2026-27: 4,822
o 2027-28: 4,782
o 5-year total: 15,815
o Ongoing: 4,782

Refocusing Government Spending - TBS Reallocations
Reallocations from the Secretariat’s budget resulting from RGS1 are as follows: 2023-24: $2,977,000
2024–25: $9,585,000
2025–26: $12,082,000
2026–27 and after: $15,500,000
TBS will achieve this by doing the following:
• reduce spending on operations
• reduce spending on professional services
• reduce spending on transfer payments
• reduce spending on travel
To deliver on the Refocusing Government Spending exercise announced in Budget 2023, TBS used a focused approach to meet its departmental expenditure targets through 2026–27 in the broad categories of professional and special services, operations, travel and transfer payments. The targets will be achieved by leveraging in-house resources to undertake work previously completed by external contractors and applying administrative efficiencies resulting from the hybrid work model and an increased emphasis on digital tools. By taking a leadership role in meeting the government-wide 50% footprint reduction target, TBS will also achieve operational savings through the consolidation of its office space. TBS planned no personnel reductions beyond normal attrition associated with the spending reviews and identified approaches to decrease reliance on professional services while minimizing the impact on service levels.
Additionally, the government has updated the value of the Low-carbon Fuel Procurement Program to $134.9 million over 8 years.

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