Health Canada Quarterly Financial Report - For the quarter ended September 30, 2025

Table of contents

• Introduction
• Basis of presentation
• Highlights of fiscal quarter and fiscal year-to-date results
• Risks and uncertainties
• Significant changes in relation to operations, personnel and programs
• Statement of authorities (unaudited)
• Departmental budgetary expenditures by standard object (unaudited)

Introduction

Health Canada is the federal department responsible for helping Canadians maintain and improve their health. In keeping with the Department's commitment to making this country's population among the healthiest in the world as measured by longevity, lifestyle and effective use of the public health care system, its main responsibilities are as a regulator, a service provider, a catalyst for innovation, a funder, and an information provider. Health Canada administers the Canada Health Act which embodies national principles to ensure a universal and equitable publicly funded health care system. A summary of Health Canada's programs may be found in Part II of the Main Estimates.

This quarterly financial report has been prepared by management as required by section 65.1 of the Financial Administration Act in the form and manner prescribed by the Treasury Board, and should be read in conjunction with the Main Estimates and Supplementary Estimates (A).

This quarterly report has not been subject to an external audit or review.

Basis of presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of authorities includes the Department's spending authorities granted by Parliament, and those used by the Department consistent with the Main Estimates and Supplementary Estimates for the 2025-26 fiscal year. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities.

The authority of Parliament is required before money can be spent by the Government. Approvals are given in the form of annually approved limits through appropriation acts, or through legislation in the form of statutory spending authority for specific purposes.

The Department uses the full accrual method of accounting to prepare and present its annual departmental financial statements that are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.

Highlights of fiscal quarter and fiscal year-to-date results

This quarterly financial report reflects the results of the current fiscal period in comparison to the authorities provided in the Main Estimates and Supplementary Estimates (A) for fiscal year 2025-26, as well as budget adjustments approved by Treasury Board up to September 30, 2025.

A. Significant changes to authorities

The following graph provides a comparison of net budgetary authorities available for spending at the end of each quarter of the current and previous fiscal years.

Figure 1 – Text description

Bar chart showing a comparison of net budgetary authorities as at June 30 and September 30 of fiscal years 2024-25 and 2025-26 in millions of dollars.

2024-25 Authorities available as at June 30 = 9,028;

2024-25 Authorities available as at September 30 = 9,087;

2025-26 Authorities available as at June 30 = 10,647;

2025-26 Authorities available as at September 30 = 10,702.

The following table provides a comparison of total authorities available by vote at the end of the second quarter of the current and previous fiscal years.

Authorities available for spending in fiscal year 2025-26 were $10,702 million at the end of the second quarter as compared with $9,087 million at the end of the second quarter of 2024-25, representing a net increase of $1,615 million, or 18%. This variance is primarily attributable to increases in funding related to the following:

• $1,216.2 million for the Canadian Dental Care Plan;
• $100.9 million in statutory authority for payments to provinces and territories under section 6 of the Pharmacare Act;
• $74.9 million for the Emergency Treatment Fund;
• $61.7 million for protecting Canadians and the environment from harmful chemicals;
• $53.1 million to support Youth Mental Health;
• $50.0 million for the Oral Health Access Fund;
• $23.7 million to support internationally educated health professionals to transition to the Canadian Workforce;
• $22.4 million in statutory authority for payments to provinces and territories pursuant to section 103 of the Patent Act;
• $20.5 million for the Diabetes Devices and Supplies Fund;
• $19.0 million for technical adjustments funded by Treasury Board of Canada Secretariat Central Votes;
• $17.0 million for Canada's Border Plan;
• $15.3 million to strengthen the capacity and transparency of the pesticide review process;
• $13.2 million for Canada Brain Research Fund; and
• $10.0 million to support access to sexual and reproductive health care information and services.

These increases in authorities are partially offset by decreases in funding related to the following:

• $85.0 million in statutory authority for payments pursuant to the Dental Benefit Act for the interim Canada Dental Benefit;
• $19.5 million for the Opioid Crisis and Substance Use and Addictions Program; and
• $15.5 million for Canada Health Infoway.

The fluctuations in authorities available for spending are most notable in the following standard objects: Transfer payments; Professional and special services; Personnel; Other subsidies and payments; and Repair and maintenance.

B. Significant changes in year-to-date expenditures

The following graph provides a comparison of net budgetary authorities available for spending and year-to-date expenditures by quarter for the current and previous fiscal years.

Figure 2: Text description

Bar chart showing a comparison of net budgetary authorities and year-to-date expenditures for the quarters ended June 30 and September 30 of fiscal years 2024-25 and 2025-26 in millions of dollars.

2024-25 Net budgetary authorities = 9,087;

2024-25 Year-to-date expenditures to June 30 = 2,938;

2024-25 Year-to-date expenditures to September 30 = 3,866;

2025-26 Net budgetary authorities = 10,702;

2025-26 Year-to-date expenditures to June 30 = 3,632;

2025-26 Year-to-date expenditures to September 30 = 5,329.

The following table provides a comparison of year-to-date spending by vote at the end of the second quarter of the current and previous fiscal years.

At the end of the second quarter of 2025-26, total budgetary expenditures were $5,329 million compared with $3,866 million reported for the same period of 2024-25, representing an increase of $1,463 million, or 38%.

Year-to-date net operating expenditures have increased by $1,290 million or 115% when compared to the second quarter of 2024-25. The increase is a result of the following significant and offsetting factors:

• Expenditures in relation to the Canadian Dental Care Plan (CDCP) including:
  • $1,331.5 million increase in benefit payments to Sun Life Assurance Company of Canada, due to an increase in the number of Canadians accessing this new program; and
  • $7.9 million decrease in Professional and special services, primarily related to program administration support, program design and claims processing services provided by Employment and Social Development Canada, Sun Life Assurance Company of Canada and Canada Revenue Agency; and
• $10.4 million increase in revenues, which results in a decrease in net operating expenditures. This variance largely reflects a fluctuation in timing of invoicing and collection of revenue and an increase in revenues of a regulatory nature following annual fee increases in accordance with Section 4(1) of the Fees in Respect of Drugs and Medical Devices Order.

There was an increase in Vote 10 – Grants and contributions year-to-date expenditures of $215 million or 8%, primarily a result of several offsetting factors including timing of payments made to recipients and changes in amount of funding available. Significant variances from the prior year are as follows:

• $202.1 million increase for contributions to provinces and territories for the National Strategy for Drugs for Rare Diseases Program; and
• $11.2 million in contributions for Emergency Treatment Fund; partially offset by
• $14.7 million decrease in contributions to Canada Health Infoway.

Statutory year-to-date expenditures have decreased by $41 million or 21% from $195 million in 2024-25 to $154 million in 2025-26, primarily as a result of the following factors:

• $85.0 million decrease in statutory spending for payments to recipients and advance payments to Canada Revenue Agency through an administrative arrangement to provide payments to recipients pursuant to the Dental Benefit Act under the interim Canada Dental Benefit, which ended on June 30, 2024; and
• $17.5 million decrease in statutory spending for costs incurred by Health Canada on behalf of the Public Health Agency of Canada under the Shared Services Partnership agreement, due to a change in timing and amount in allocation of expenditures pursuant to section 4.2 of the Department of Health Act; partially offset by
• $29.7 million increase for payments to provinces under section 6 of the Pharmacare Act;
• $19.1 million increase for payments to provinces pursuant to section 103 of the Patent Act; and
• $12.5 million increase in statutory spending for employee benefit plan costs is due to an increase in the rate used for the calculation of the employee benefit plan for 2025-26 and an increase in estimated salary expenditures including annual salary and step increases.

C. Quarterly variances

The following graph presents a comparison of quarterly spending by quarter and by fiscal year.

Figure 3: Text description

Bar chart showing a comparison of quarterly expenditures for the quarters ended June 30 and September 30 of fiscal years 2024-25 and 2025-26 in millions of dollars.

2024-25 Expenditures for the quarter ended June 30 = 2,938;

2024-25 Expenditures for the quarter ended September 30 = 928;

2025-26 Expenditures for the quarter ended June 30 = 3,632;

2025-26 Expenditures for the quarter ended September 30 = 1,696.

Expenditures in the second quarter of fiscal year 2025-26 were $1,696 million compared with $928 million for the second quarter of 2024-25, representing an increase of $768 million or 83% in quarterly spending.

$763.2 million of the increase in quarterly spending is primarily due to benefit payments and advance payments to Sun Life Assurance Company of Canada, which have increased as the number of Canadian accessing this new program has grown since the program began.

In addition, there were a number of offsetting year-over-year fluctuations in quarterly spending due to timing of expenditures for grants and contributions to the provinces and territories for the National Strategy for Drugs for Rare Diseases Program, for improving working conditions for personal support workers, for the Territorial Health Investment Fund, to the Canadian Institute for Health Information, and to the Canadian Partnership Against Cancer.

Risks and uncertainties

Health Canada operates in a complex and dynamic environment, where several factors can impact on its efforts to deliver results for Canadians. These include health workforce shortages, the availability and affordability of health services, substance use-related harms and the overdose crisis, global supply chain disruptions, misinformation and disinformation, and the impacts of climate change, which often lie beyond the Department's sole control. Addressing these complex issues requires close collaboration with federal partners, provincial and territorial (P/Ts) governments, Indigenous organizations, non-governmental stakeholders, industry, and international regulators.

Health Canada works to foster sustainable health care systems, with the goal of ensuring that Canadians have access to appropriate and effective health care. However, these systems face significant challenges related to sustainability, access to services, and service delivery. Although health care delivery is primarily under P/T jurisdiction, with funding administered via the Canada Health Transfer, the Department plays an important role in supporting P/Ts in their health care and health system priorities. This includes upholding the Canada Health Act, advancing the Government's Working Together to Improve Health Care for Canadians Plan, which provides funding to support P/Ts on shared priorities, and improving access to oral health care services for Canadians.

The Department also works with domestic and international partners to assess, manage, and communicate the health and safety risks and benefits associated with health and consumer products, food, chemicals, pesticides, environmental factors, tobacco and vaping products, cannabis and controlled substances. Addressing the need for increased access to health products, the overdose crisis, global supply chain disruptions, and emerging health and environmental risks requires ongoing regulatory development. Health Canada continuously modernizes its regulatory approaches, strengthens partnerships, and supports innovative initiatives to respond to health risks more effectively and efficiently, and with greater agility.

Health Canada's priorities remain focused on ensuring that government investments and the regulatory framework protect the health and safety of Canadians. There are both corporate- and program-level risks associated with the rapid delivery of government commitments, programs, and services. As per its Risk Management Policy, the Department applies a consistent approach to risk management and maintains a comprehensive, up-to-date Corporate Risk Profile to support risk-based decision-making.

Health Canada manages risks and uncertainty through effective engagement across the organization with agile and sound governance structures, as well as long-term planning. The executive-level committee on Finance, Investment Projects and Transformation recommends overall direction for financial management and control, and ensures alignment of investments with departmental strategies and transformation initiatives.

Significant changes in relation to operations, personnel and programs

In August 2025, Mr. Matt Jones was appointed Assistant Deputy Minister for the Pest Management Regulatory Agency, while continuing to serve as Assistant Deputy Minister of the Healthy Environments and Consumer Safety Branch.

In August 2025, Mr. Eric Costen departed from his position as Associate Deputy Minister.

There have been no other significant changes in relation to operations, personnel and programs during this quarter.

Approved by:

Original signed by Greg Orencsak
Greg Orencsak
Deputy Minister
Ottawa, Canada
Date: November 21, 2025

Original signed by Ryan Higgs
Ryan Higgs
Acting Assistant Deputy Minister and Chief Financial Officer
Ottawa, Canada
Date: November 14, 2025

Statement of authorities (unaudited)

Departmental budgetary expenditures by standard object (unaudited)