Government Operations Committee on Feb. 12th, 2026

[The Chair, Conservative, Kelly McCauley]

Welcome to meeting number 27 of the House of Commons Standing Committee on Government Operations and Estimates.

We welcome back the President of the Treasury Board and his associates for our continuing discussion on various subsets of Bill C-15.

President Ali, I understand you have an opening statement for us. The floor is yours for five minutes, sir.

[Shafqat Ali, Liberal, President of the Treasury Board]

Good morning, everyone.

Thank you for inviting me.

I want to begin by acknowledging the heartbreaking tragedy in Tumbler Ridge. As the parent of three children, I can only imagine the shock and sorrow being felt by affected families and the community. The country shares their sadness and grieves with them.

As for the business of today, I'm pleased to be here with officials from TBS to discuss the budget implementation act, specifically divisions 5 to 7.

An effective regulatory system maintains appropriate controls. It also keeps pace with innovation. To this end, budget 2025 proposes to expand the use of and increase the transparency of regulatory sandboxes.

Regulatory sandboxes have been in use in certain departments since 2019. They help the government figure out the best way to regulate new innovations before putting permanent rules in place. This means products and services can be introduced more quickly into the marketplace using the most appropriate regulatory approach.

The proposed expansion of sandboxes would extend their use across government. However, they could only be used for a specific, time-limited purpose, where there is a clearly defined benefit to the country and Canadians. They would also need to follow a rigorous and transparent process.

First, advance notice of the proposed sandbox would be publicly reported in a department's forward regulatory plan. Once approved, sandboxes would be publicly reported by the responsible department and in an annual report to this committee. At all times, safeguards to protect Canadians' health, safety and environment would be maintained.

The budget implementation act also includes proposals to help us spend less on government operations so we can invest more in areas that matter most to Canadians. As members know, we are reducing the size of the public service by approximately 16,000 FTEs. This is difficult but responsible work.

To help reduce the impact on employees, budget 2025 proposes a voluntary early retirement incentive. This program would enable employees to retire early without financial penalties. After the review of Bill C-15, and because of the challenges we all face together as Canadians, we must work together and stand up for the workers who built this country and ensure that they have the respectful retirement they have earned.

Budget 2025 also proposes important changes to the Public Service Superannuation Act to extend early retirement benefits to firefighters, CBSA officers, Parliamentary Protective Service officers and others in similar roles. They would be able to receive their pension after 25 years without financial penalties. This recognizes the demanding nature of the day-to-day duties of these employees.

These proposals are collectively aimed at helping government operate more efficiently and effectively, a goal that I know is important to this committee.

Thank you, Mr. Chair.

My officials and I would now be pleased to answer your questions.

[The Chair, Conservative, Kelly McCauley]

Thank you, sir.

We'll start six-minute rounds with Ms. Kusie.

Ms. Kusie, welcome back to OGGO. It's wonderful to have you here.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you. It's a pleasure to be here, Mr. Chair.

Minister, your budget unveiled a plan to eliminate 40,000 jobs in the federal public service by 2028-29. Since then, 68,000 public servants have received the notice that they may be eligible to apply for the early retirement incentive as a mechanism to eliminate these jobs. Does the Treasury Board have an estimate of how many of those 68,000 public servants will apply for the early retirement incentive?

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

Thank you for your question, and I welcome my critic. I'm looking forward to having that coffee; our teams are working on scheduling that.

Your question is on workforce adjustments. We have sent 68,000 letters to the people who may qualify for that program. There are certain options. We don't know how many will come forward. That program will roll out after the budget implementation act gets royal assent.

At this point, per the bargaining agreement, we have sent those letters to them, and we'll have more to say when we have clarity on that.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you for that response.

As you're not aware of the number, how are departments organizing their job losses and restructuring if you don't have an estimate of how many public servants will voluntarily retire? That's a pretty important number for workforce adjustment planning.

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

We have sent the letters, and we know how many qualify, but we don't know how many will be eligible, because not everyone who has been sent a letter will be considered for that program. There are certain criteria. There are skills. It's nerdy.

Because more technicality gets involved, I'll ask my deputy to give you—

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

That's fine, Minister. Thank you so much.

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

It is for your benefit and that of the Canadians who are watching. I think it's a very important question.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Minister, I don't have a lot of time, and you're not providing me with a lot of information. I'm going to move on.

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

Okay.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

In December, you announced that the public service pension fund had an unpermitted surplus of $900 million and that you were moving this money into the general revenues of the government. Where will that money be spent?

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

Can you repeat your question, please?

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

In December, you announced that the public service pension fund had an unpermitted surplus of $900 million and that you were moving this money into the general revenues of the government. You've seen this before. I'm sure you were briefed when you received this position. Where will this particular allotment be spent, President?

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

In that pension fund, if we have any surplus on certain.... There's a threshold. If it's over that threshold, the money moves into trust funds.

I could ask my deputy to clarify a bit more for your benefit and that of the Canadians who are watching at home.

[Bill Matthews, Secretary of the Treasury Board of Canada, Treasury Board Secretariat]

The money has indeed been brought back in. It's been invested, but there have been no decisions taken yet in terms of how that money will be spent.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you. I'm going to move on.

In 2023, Minister Anand announced that departments would be ordered to find savings of $15 billion. However, the details were scant. Unsurprisingly, the 2024 and 2025 public accounts of Canada indicate that those savings have yet to be achieved.

On Monday, I asked your department whether proposed savings announced in the comprehensive expenditure review would be realized or whether they would be dealt a fate similar to the 2023 ill-hearted attempt at savings. A senior official actually stated, “I don't think you will be able to see a decrease as compared to what was announced in the budget”. Do you agree with that statement, President?

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

What I can tell you is that the comprehensive expenditure review will achieve savings of $9 billion in 2026-27, $10 billion in 2027-28 and $13 billion in 2028-29.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

These are all projections. As I indicated, your government failed on the 2023 objectives. I just received on Monday from a senior official a lack of confidence that these numbers will also be achieved.

A hundred days ago exactly, the government unveiled the initial details of the CER, the comprehensive expenditure review, in the budget, yet here we are today with your own department stating that your own spending reductions will not be met despite the continuous forecasts you're putting forward. This isn't just me doubting your savings. It's your own senior officials, which should be very concerning for you.

How do you expect Canadians to believe that your government will actually lower spending as you've promised if your own Treasury Board officials don't?

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

I don't know where that is coming from to you, but what I know is that proposals we received from 102 organizations—

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

It's your comptroller general. You should probably have a conversation with her.

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

I'm sorry. Can I respond to that question?

[The Chair, Conservative, Kelly McCauley]

Give a brief response, please.

[Shafqat Ali, Liberal, Brampton—Chinguacousy Park, ON]

We received proposals for the comprehensive expenditure review from 102 organizations. Other than DND, CBSA, CSIS and the RCMP, all organizations have put forward this plan. I believe those are the organizations that are delivering services to Canadians. They're responsible and they have put forward this plan. I'm confident that we will achieve our—

[The Chair, Conservative, Kelly McCauley]

Thank you.