Carney’s government says it is cutting spending on foreign aid to a level in line with Canada’s aid allocations before the pandemic, without specifying the size of this year’s aid budget.
Tuesday’s budget forecasts cuts of $2.7 billion over four years, affecting things like global health projects. Ottawa is also withdrawing some support for a world-renowned aid research center.
“There will be reductions in development funding for global health programming, where Canada’s contribution has grown disproportionately relative to other similar economies,” the budget document says.
It’s unclear where the aid cuts will land. The budget talks about “leveraging innovative tools, while focusing support on the countries that need it most” and restructuring existing agreements with specific countries.
The budget also says Canada will cut funding “to some international financial institutions” while finding ways that “Canada’s contributions can be further leveraged.”
Canada spent $6 billion on aid in the last reported fiscal year ending in March 2024, along with $2.6 billion in international financial assistance such as loans to Ukraine. Total spending on all aid-related dossiers, including support for refugees in Canada and development grants, amounted to $12.3 billion in the last reported fiscal year.
Ottawa increased its humanitarian and development spending during the pandemic, in part to restore stalled progress in the fight against major diseases like AIDS and tuberculosis as governments focused their attention on COVID-19.
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Developing countries are still grappling with a debt crisis fueled by high interest rates that soared as richer governments spent heavily during the pandemic. They also face an increase in the number and intensity of natural disasters due to climate change.
Under the banner of “trade finance,” the government is redirecting $138 million in current funding to Global Affairs Canada (mostly from an allocation Ottawa taps into to make funding announcements at global summits) to rebuild Ukraine’s critical infrastructure.
The government says rebuilding Ukraine could boost Canadian industry “in almost every sector, from engineering and energy to agri-food, health care and technology.”
The International Development Research Center will see deeper and deeper cuts, starting with $11.4 million in the fiscal year starting in April and rising to $23.5 million annually at the end of five years.
Parliament has allocated $159.4 million to IDRC for the current fiscal year.
The cuts come just days after Randeep Sarai, secretary of state for international development, suggested the institution would have sufficient funding.
At the House of Commons foreign affairs committee on October 28, Liberal MP Rob Oliphant, parliamentary secretary to Foreign Minister Anita Anand, questioned Sarai about IDRC funding in this budget.
Oliphant called IDRC “a preeminent, world-class institution, providing research so we can put our help in the best possible places.”
He said the agency’s research leads to projects that prevent costly humanitarian crises. Sarai agreed.
“I call it our secret weapon. I think IDRC is one of Canada’s best investments,” Sarai said. He gave the example of the agency that helped create “climate-resilient potatoes in the Philippines,” helping the rural poor feed their children and send them to school.
“I think it will continue to have the necessary support. It is one of the most important institutes in Canada,” Sarai testified.
Prime Minister Mark Carney heads to the G20 summit in Johannesburg later this month. The South African government is expected to boost aid spending and loans to address what it called this week an “inequality emergency” that is disrupting democracy and destabilizing economies.
© 2025 The Canadian Press
