Budget 2025 Initiates Major Changes for Federal Public Service
Budget 2025 aims to reduce the federal public service workforce by about 16,000 full-time equivalents over three years, representing roughly 4.5% of current staff. This includes up to 1,000 executive positions. By 2028-29, a total reduction of approximately 40,000 workers is expected compared to the peak in 2023-24.
Key Objectives and Workforce Reductions
The government plans to streamline operations with less dependence on external consultants and deploy a Canadian-developed AI tool across federal services. Many federal public servants, especially those in the National Capital Region, will experience significant changes.
Transformational Vision for the Future
"This is a transformational time for the public service to revisit how we work, how we can improve services to Canadians and how we can build for the future," states the budget document.
Early Retirement Incentive Program
Budget 2025 proposes changes to superannuation and tax regulations enabling a voluntary Early Retirement Incentive (ERI) through the Public Service Pension Plan. Employees aged 50 or older, with at least 10 years of service and two years of pensionable employment, will be eligible to apply.
Summary
The 2025 federal budget sets a course for a smaller, more efficient workforce supported by innovation and retention incentives, reflecting a strategic shift in public service management.