The Canadian government’s expenditure on external professional and special services in the fiscal year 2024-25 surpassed $19 billion, marking a notable rise of nearly $2 billion compared to the previous year and an increase of approximately $8.5 billion since 2020, as per official government data. This upsurge in spending primarily stems from increased investments in engineering and architectural services for initiatives like shipbuilding, health services to aid refugee claimants, and specialized training for air force pilots and aircrew personnel, as reported by the Treasury Board of Canada Secretariat.
Government records reveal that a total of $23.1 billion was allocated towards professional and special services for the fiscal year ending on March 31, with approximately $19.5 billion channeled to external entities. Notably, the Department of National Defence (DND) contributed $6.9 billion for internal and external professional services in 2024-25, while Immigration, Refugees and Citizenship Canada (IRCC) expended $1.7 billion.
Over the years, the Liberal government has faced criticism regarding its extensive reliance on external consulting services, with public service unions advocating for more government-led initiatives. Former Prime Minister Justin Trudeau, in his 2015 election agenda, pledged to curtail the government’s utilization of external consultants. However, between 2015-16 and 2024-25, expenditures on external services surged from around $8.3 billion to roughly $19.5 billion.
Criticism was particularly directed at the Liberal government concerning the expenses associated with the ArriveCan app project, launched in April 2020 to monitor health and contact details of individuals entering Canada amidst the COVID-19 pandemic. Auditor General Karen Hogan’s report highlighted inadequate record-keeping and heavy reliance on external contractors, leading to a substantial increase in project costs to nearly $60 million, far exceeding the initial contract value of $2.35 million.
In the budget released recently, Prime Minister Mark Carney, who assumed office in March, underscored the commitment to reducing government spending by notably decreasing reliance on external consultants. The government aims to slash expenses on management and consulting services by 20% within three years to enhance efficiency, accountability, and capacity within the public service. Meanwhile, the Public Service Alliance of Canada (PSAC) continues its efforts to safeguard public service jobs and restrict external contracting, emphasizing the importance of utilizing internal resources where feasible.