Finance Minister François-Philippe Champagne put a stop to job cuts at CRA call centres even as the federal government has called for trims to programming spending across all departments.Spencer Colby/The Canadian Press
Here’s a bit of political performance one doesn’t see every day in Ottawa. Last month, Finance Minister François-Philippe Champagne announced, with a certain fanfare, a 100-day plan to fix the persistent problem of service delays at the Canada Revenue Agency.
The CRA had, until that point, been busy cutting jobs. In a little over a year since May of 2024, it had reduced its workforce by roughly 10 per cent, eliminating more than 8,000 positions, including many at call centres. Then Mr. Champagne swooped in, wagging an index finger.
The agency was told to not only stop the call centre cuts but to start hiring more people to pick up the phone when taxpayers call in for help.
CRA announces call-centre hires, online help for locked accounts to improve service
The Finance Minister also said he wanted new solutions to ease call-centre congestion. And suddenly, magically, the CRA rushed to announce a slew of new initiatives, including a web system to allow people to schedule calls with CRA agents, a longstanding suggestion from the Taxpayers’ Ombudsperson the agency had previously brushed aside.
But the Carney government has also made it clear it still expects the CRA to find ways to save money as it looks to free up room in the federal budget for massive new spending on defence and infrastructure.
Mr. Champagne himself told cabinet ministers in July they must trim program spending by 7.5 per cent in the fiscal year that begins April 1, 2026, rising to 10 per cent and, later, 15 per cent in savings in the following two fiscal years.
Canadians watching the public flogging of the tax agency may feel a tinge of optimistic disbelief. Did the Carney government, essentially, tell the CRA to find better ways to trim spending than just laying off call-centre agents, a.k.a. workers on temporary contracts, who are notoriously easy targets for job cuts in the unionized civil service?
And wouldn’t it be nice if this was the message Prime Minister Mark Carney was sending to all federal departments and agencies: Look for the smart cuts, not just the easy cuts? Figure out how to carve out the fat in the federal bureaucracy without slicing into the muscle that delivers essential services to citizens and businesses?
Hold the applause. The Finance Minister’s newfound urgency to tackle CRA delays is certainly a welcome change. But it also raises the question of why the Carney government had to stop the agency in its tracks instead of giving clear directions from the beginning about the kind of spending reductions it wants to see.
Ask insiders what it takes for a federal or provincial government to force the public bureaucracy to roll back spending and you’ll get remarkably consistent advice. Set clear coordinates to guide the cutting exercise and put someone in charge of cracking the whip, a full-time cuts-czar of sorts with authority to set timelines and push through unpopular decisions.
To be clear, Mr. Carney isn’t promising to balance the budget. But he needs major spending cuts somewhere if he wants to boost military spending and expenditures on things such as new roads and ports, without blowing up the federal deficit.
A recent paper co-authored by Kevin Page, a former parliamentary budget officer, says Ottawa will have to find at least $30-billion in annual savings for the next three fiscal years.
Resizing the federal bureaucracy is a good place to start. Over the past decade, the number of workers in the federal public service has grown at more than twice the rate of the general population, and that’s including years of record immigration.
The Liberals need to show their cost-cutting ambition
Yet, to date Mr. Carney has said very little, at least publicly, about the principles that should guide the spending review he’s asked for or how he plans to ensure that recalcitrant government departments follow through.
In fact, the Liberals have yet to explain what they mean with the program spending reduction targets they have set. The Trudeau-era Liberals would talk about spending reductions when all they were doing was reducing the size of spending increases. Are Messrs. Carney and Champagne asking cabinet ministers to spend less or simply to slow down the growth in spending?
Here’s hoping the Liberals have a detailed and credible master plan for actual cuts in the upcoming federal budget on Nov. 4. Transparency is the government’s best bet to get what it wants from the federal public service and make the case for difficult decisions to Canadians.