The Canadian government has allocated over $19 billion towards external professional and special services for the fiscal year 2024-25, marking an increase of nearly $2 billion compared to the previous year and approximately $8.5 billion since 2020, as per official government reports.
This surge in expenditure is primarily attributed to the augmented investment in engineering and architectural services for initiatives such as shipbuilding, health services to aid refugee claimants, and specialized air force pilot and aircrew personnel training, as disclosed by the Treasury Board of Canada Secretariat.
Government records indicate that a total of $23.1 billion was disbursed on professional and special services for the fiscal year ending on March 31, with approximately $19.5 billion directed to external entities. Notably, the Department of National Defence (DND) contributed $6.9 billion towards internal and external professional and special services in 2024-25, while Immigration, Refugees and Citizenship Canada (IRCC) allocated $1.7 billion for similar purposes.
Over the years, the Liberal government has faced criticism for its substantial spending on external consulting services, with public service unions advocating for the work to be conducted by government employees. Former Prime Minister Justin Trudeau had pledged in his 2015 election platform to diminish the government’s reliance on external consultants. However, between 2015-16 and 2024-25, the government’s expenditure on external services surged from around $8.3 billion to approximately $19.5 billion.
Criticism was particularly directed towards the ArriveCan app project by the Liberal government, which launched in April 2020 to monitor health and contact information of individuals entering Canada amid the COVID-19 pandemic. Auditor General Karen Hogan’s report highlighted poor record-keeping and dependence on external contractors, resulting in the project’s costs escalating to nearly $60 million from an initial contract value of $2.35 million.
In the fiscal year 2019-20, the government’s public accounts reveal an expenditure of $11 billion on external professional and special services. The Public Service Alliance of Canada (PSAC) disclosed in 2023 that it had negotiated contractual provisions to safeguard public service jobs and curtail external contracting. Moreover, the government had committed to a consultative process on the challenges associated with outsourcing in the federal public service.
Following his inauguration as Prime Minister in March, Mark Carney vowed during the spring election campaign to trim government expenditures by notably reducing reliance on external consultants while enhancing the public service’s capability to recruit expertise internally. The recent budget announcement by the federal government aims to slash expenses on management and consulting services by 20% within three years to minimize wasteful spending and empower the public service to assume more responsibilities and enhance accountability.
As negotiations proceed for contracts concerning numerous PSAC members, the alliance emphasizes its ongoing efforts to combat the outsourcing of government services when capable members can perform the tasks.
