Federal Bureaucracy Expands Rapidly While Efficiency Questions Loom
If a larger government automatically translated to improved governance, Canada's federal administration would undoubtedly be a champion for enhancing citizen welfare. However, the reality is far more complex, as recent data reveals a substantial expansion in the public sector that has significantly outpaced both demographic and economic growth.
Substantial Growth in Public Service Numbers and Costs
From 2015 to 2025, the federal bureaucracy experienced a dramatic increase of almost 40%. The number of employees surged from 257,034 to 357,965, representing an addition of over 100,000 positions. During this same period, the federal payroll ballooned by 80%, escalating from $39.6 billion in 2015 to $71.4 billion in the 2024-25 fiscal year.
The cost per full-time equivalent position has also risen sharply. In 2023-24, this figure stood at $136,345, climbing to $143,271 by 2024-25. The Parliamentary Budget Officer highlighted this as marking a second consecutive year of historically high growth in spending per employee.
Outsourcing and Consultant Expenditures Also Spike
In addition to the growing internal workforce, the government significantly increased its reliance on external consultants. By 2023, annual spending on outside help reached $21.4 billion, a staggering 106% increase from the $10.4 billion spent when the Trudeau administration took office in 2015. This rise occurred despite earlier commitments to reduce consultant usage.
The expansion and associated costs of the federal civil service have far exceeded key national indicators. Between 2015 and 2024, Canada's population grew by 15%, the economy experienced an 18.5% real growth rate, total employment increased by 15.5%, and public sector employment across all government levels rose by 25.5%.
Expert Analysis Questions the Growth Rationale
Peter Nicholson, a former senior federal public servant and business executive, authored a policy paper questioning the size of the federal public service. He argued that there is no inherent reason for civil service growth to match or exceed population increases. Ideally, investments in information technology, improved work processes, and management training should enhance productivity, potentially allowing public service growth to remain below population growth.
By 2024, the ratio of federal public servants per 1,000 population reached 9.0, the highest level in at least four decades. Some attribute portions of the increase to new federal initiatives like dental care and pharmacare, as well as pandemic-related hiring in 2020. However, the bureaucracy continued to expand annually after the pandemic, rising from 300,450 positions in 2020 to 367,772 in 2024, before a slight reduction to 357,965 in early 2025.
Political Responses and Future Projections
During his Liberal leadership campaign, Mark Carney pointed to the federal government's 9% annual operational spending growth under the previous administration as a factor contributing to economic weakness prior to U.S. tariff impositions. The most recent federal budget outlined plans to reduce the public service by 40,000 positions by 2028-29, aiming to bring numbers down to approximately 330,000 through layoffs, attrition, and early retirements.
This proposed reduction would return the public service to a size slightly below its 2022 level, which was already two years into the pandemic. Public sector unions have predictably criticized the plan, warning it could undermine public services, though the scale of the cut is not considered draconian by some analysts.
The ongoing debate highlights a critical tension between government expansion and the pursuit of efficiency, with data suggesting that bigger government has not necessarily equated to better outcomes for Canadians.
