Colleges and universities are expected to push back at the cuts to international-student numbers that have declined by about 60 per cent compared to 2024 when Ottawa capped study-permit applications.Isabella Falsetti/The Globe and Mail
The federal government announced a dramatic cut in the number of temporary residents – particularly international students – it plans to admit to Canada in the next three years, while stabilizing the number of permanent residents to 380,000 a year for three years, down from 395,000 in 2025.
In its immigration-levels plan, released as part of Tuesday’s budget, the government has slashed the number of temporary residents Canada will admit to 385,000 next year from 673,650 in 2025. It cuts temporary-resident numbers further to 370,000 a year in 2027 and 2028.
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In a move that may draw backlash from colleges and universities, Ottawa will halve the number of international students who can come here. It has slashed its previous target of admitting 305,900 foreign students each year from 2025 to 2027, and now plans to reduce numbers to 155,000 in 2026, and drop them further to 150,000 in each of 2027 and 2028.
The squeezing of admissions reflects waning public support for immigration, including for temporary residents, whose proportion of Canada’s population more than doubled from 3.3 per cent in 2018 to 7.5 per cent by 2024.
The government’s budget document said this “unprecedented rate of growth” has “put pressure on housing supply, the health care system, and schools” and is “no longer sustainable.”
Prime Minister Mark Carney has said he wants to restore immigration rates to “sustainable levels” while attracting “the best talent in the world to help build our economy.”
The budget includes measures to poach talented workers from abroad, including the United States. There is a plan for a swift pathway to Canada for holders of U.S. H-1B visas, meant for high-skilled jobs that U.S. tech companies find hard to fill.
Ottawa is also set to launch an initiative to recruit more than 1,000 top international researchers to Canada, with the budget injecting up to $1.7-billion into a suite of recruitment measures.
Finance Minister François-Philippe Champagne told reporters that Canada wants to attract “the best and the brightest.”
Ottawa is aiming to keep new permanent residents at less than 1 per cent of the population beyond 2027, while reducing the number of temporary residents to less than 5 per cent of the population by the end of 2027.
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Colleges and universities are expected to balk at the deeper cuts to international-student numbers, which have fallen by about 60 per cent compared with 2024, when Ottawa capped study-permit applications.
Higher education institutions have warned that reducing the numbers of foreign students, who pay high tuition fees, hits their finances hard and leads to cuts in academic programs.
Some employers have argued that they need temporary workers to fill vacancies, particularly in remote areas. The budget says the full immigration-levels plan, to be published shortly by Immigration Minister Lena Diab, will address sectors hit by tariffs “and the unique needs of rural and remote communities.”
The budget announced a plan to allow 33,000 work-permit holders to settle permanently in Canada in 2026 and 2027, saying they have established strong roots in their communities, pay tax and help build the economy.
This year’s immigration-levels plan also launches a one-time initiative to allow refugees to gain permanent residence over the next two years, saying “the vast majority of these people cannot return to the country of their origin.” The program will cost a total of $120-million over four years to process applications.
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Ottawa is making changes to health supports that asylum claimants and refugees are entitled to, including free vision care and pharmaceuticals. It plans to introduce a “modest co-payment” system so refugees and asylum claimants share some of the cost with the government.
Ottawa allocated $598-million in the 2025-26 fiscal year to pay for health care for asylum claimants and refugees, with another $411-million allocated to pay for it in 2026-27.
Conservative immigration critic Michelle Rempel Garner has criticized the scale of benefits available to asylum seekers through the Interim Federal Health Program. She has said many Canadians do not qualify for such government-funded health supports, including for counselling, speech therapy, home care and physiotherapy.
As part of wider reductions to the cost of the public service, Immigration, Refugees and Citizenship Canada will seek to cut expenditures by 15 per cent over three years. Some of this will come from savings to the federal Interim Housing Assistance Program, which helps provinces and municipalities shoulder the cost of housing asylum claimants, owing to a decline in their numbers.
Ottawa has earmarked hundreds of millions of dollars in legal aid for asylum seekers, with $189-million allocated for lawyers in 2025-26; $187-million in 2026-27; and $103-million in 2027-28.