OTTAWA – Prime Minister Mark Carney should “take a page from the Chrétien government’s 1994 program review” and cut tens of thousands of bureaucrat jobs, argued the Montreal Economic Institute (MEI) in a new paper published on Thursday.
The economic think tank found that a program review like the one from 30 years ago would result in the elimination of about 64,000 federal government jobs. This would lead to a return to the pre-Justin Trudeau government per capita size of the bureaucracy and a permanent reduction in public spending of nearly $10 billion a year by 2029, MEI experts say.
“The size of the Canadian public service once again requires attention. Despite the government belatedly acknowledging the need to restrain the growth of the federal bureaucracy, more decisive action is required,” said Conrad Eder, the associate Researcher at the MEI that produced the viewpoint.
During the federal election, Liberal Leader Mark Carney promised to cap the size of the federal workforce and to “not cut public service employment.”
“As part of our review of spending we will ensure that the size of the federal public service meets the needs of Canadians,” reads the Liberal platform.
The Liberals also promised to launch a “comprehensive review of government spending” focused on productivity. The review, it was said, would focus on “clear targets by departments and Crown Corporations with an iterative process that deploys best approaches across the public sector.”
For instance, the government wants to amalgamate service delivery, consolidate grants and contributions that serve similar purposes and reduce reliance on external consultants.
Following this review, Ottawa wants to put in place a permanent process to “link spending and outcomes across departments and continuous improvement in spending control.”
“Prime minister Carney’s promises to review federal spending give us cause for optimism, but the lack of details surrounding how it will be conducted brings us caution,” wrote Renaud Brossard, vice president of communications at the MEI, in an email exchange with National Post.
In 2023, then
prime minister Justin Trudeau gave a mandate to his then President of the Treasury Board
Anita Anand to find $15 billion in savings across the government by 2028, and then $4 billion annually after that.
Yet, from 2015 to 2025, the number of federal public servants increased by more than 110,000, a 43 per cent increase according to the MEI. There are 367,772 federal employees, or nine per 1,000 residents, compared to 7.2 when Trudeau took office.
By comparison, the United Kingdom has 7.4 federal employees per 1,000 residents and Germany 6.2 employees per 1,000 residents.
Last year, the MEI noted that federal personnel costs were on track to exceed $70 billion, compared to $40 billion in 2016-2017, the first fiscal year of Trudeau’s first mandate. According to the MEI, this represents one in seven dollars spent by the government.
The MEI maintains that a large portion of this spending is financed by large deficits. In 2024, the federal government posted a deficit of $61.9 billion, far exceeding its promise to keep it below $40.1 billion.
“Given the size of our deficit and the speed at which the bureaucracy has grown over the last decade, a federal spending review needs to be just as ambitious as the one undertaken under the Chrétien government in the 1990s,” Brossard said.
The 1994 program review has become an example of good fiscal practice in Canadian economic circles. When Jean Chrétien was elected prime minister in 1993, Canada was grappling with persistent deficits, an unsustainable national debt and a ballooning public service.
Chrétien then asked his finance minister Paul Martin to put “the house in order”.
The program review evaluated federal programs based on public need and fiscal capacity. The government then restructured programs and eliminated jobs in the public service. In fact, the size of the bureaucracy shrunk by over 42,000 employees, or 17.4 per cent, at the time they were done in 1999.
“Chrétien’s reforms worked because they were targeted and pragmatic,” explained Brossard. “His government proved that it is possible to provide essential services while tackling overspending.”
National Post
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