Standing Committee on Government Operations and Estimates: February 10, 2026
Bill C-15: An act to implement certain provisions of the budget tabled in Parliament on November 4, 2025
Date: February 10, 2026
Location: In person
On this page
General items
1. Opening statement
The Honourable Joël Lightbound,
Minister of Government Transformation, Public Works and Procurement and Quebec Lieutenant
Standing Committee on Government Operations and Estimates (OGGO)
Budget Implementation Act—Bill C-15 and Government Transformation
February 10, 2026
Check against delivery
Length: 610 words
Opening
Before I begin, I would like to acknowledge that we are gathered today on the traditional, unceded territory of the Algonquin Anishinaabe People.
Thank you, Mr. Chair, and members of the committee, for inviting me to speak on Bill C-15, the Budget Implementation Act.
Budget 2025 addresses a time of profound change for Canada as the world undergoes a series of fundamental shifts.
Our plan is to build up, protect, and empower Canada—to make us stronger, more self-sufficient, and more resilient.
To do that, we must rapidly change the way we deliver for Canadians. That is why our Government is focused on working differently and transforming the way we do business.
As a common service provider for the Government, Public Services and Procurement Canada—or PSPC for short—plays an essential role in this effort.
Budget 2025: Proposed investments for Public Services and Procurement Canada
Budget 2025 proposes a number of important investments to support PSPC’s mandate.
This includes measures to support our recently launched Buy Canadian Policy—our plan to protect and prioritize Canadian workers and industries through federal procurement.
It also proposes historic investments in defence, including support for the Defence Investment Agency, recently launched to transform the way we do defence procurement.
Other examples of transformation across government include our work to modernize legacy information technology (IT) systems and adopt artificial intelligence (AI) at scale for the public service, and to reduce operational spending by creating a leaner public service.
Canada Post
Mr. Chair, the main items for PSPC in Bill C-15 relate to proposed amendments to the Canada Post Corporation Act.
Specifically, Bill C-15 includes a proposal to amend the time-consuming process for postage rate increases.
This will reduce the administrative burden by allowing Canada Post to set stamp rates without seeking Governor in Council approval, removing the current cumbersome and time-consuming process.
I also note the proposed amendments reflect one of the recommendations of the Industrial Inquiry Commission, led by William Kaplan.
The proposed amendments will reduce red tape and allow Canada Post to set rates in a timely and responsive manner, while maintaining appropriate guardrails and checks and balances.
The goal here is that rates remain fair and transparent, while also sufficient to cover costs, helping to ensure the future financial sustainability of Canada Post’s operations, to the benefit of all Canadians.
Mr. Chair, I would like to be clear that these amendments are administrative in nature and are not changes in policy direction.
I know that there have been questions and concerns on whether Canada Post will continue to provide materials for the blind at no charge and at discounted rates for libraries. Let me be unequivocal and clear—there is no change in policy direction. Canada Post will continue to provide materials for people who are blind at no cost and libraries at reduced costs.
I would note that Canada has provided free postage for materials used by people who are blind since 1898 as part of its obligations under the Universal Postal Convention, and that will continue. In addition, the library book rate—the discounted rate for libraries to ship materials—has existed since 1939. Neither of these are being changed through the proposed amendments to the Canada Post Corporation Act.
Closing
Mr. Chair, we are in the midst of a total government transformation; we are doing things differently and changing our ways of working. We’re spending less so Canada can invest more.
We know that government itself must become much more productive by rightsizing, cutting red tape and wasteful spending, and adopting AI at scale.
At the same time, we need to make the smart, generational investments to grow the economy and prosperity for Canadians—and with Budget 2025, that’s exactly what we’re doing.
Thank you.
2. Clauses in Bill C-15 specific to Public Services and Procurement Canada and the Portfolio
Summary
The following clauses of Bill C-15 have been referred to the Standing Committee on Government Operations and Estimates. Public Services and Procurement Canada is the lead department for Clauses 195 to 199.
Canada Post: Clauses 195 to 199
- Clause 196 proposes amendments to the Canada Post Corporation Act that would grant the Canada Post Corporation authority to establish postage rates and terms independently, requiring rates to be fair, reasonable, and sufficient to cover costs (with exceptions for bulk mail agreements and experimental services). It also mandates public disclosure of standard rates while allowing confidentiality for negotiated agreements
- Clauses 195 and 197 to 199 repeal various existing provisions of the Canada Post Corporation Act including the definition of "library material", certain paragraphs and subsections from section 19, and sections 21 to 21.2, with implementation to occur on a date set by the Governor in Council
Red Tape Reduction: Clauses 203 to 209
- The clauses establish a two-part framework: Part 1 controls administrative burden from regulations on businesses, while Part 2 creates a new ministerial exemption power allowing entities to be temporarily exempt from certain laws/regulations (up to 6 years total) to test innovations that encourage economic growth, provided the exemption is in the public interest and risks are managed
- Transparency and oversight requirements mandate that ministers must publicly disclose exemption orders and their rationale, and the President of the Treasury Board must prepare annual public reports listing all active exemptions, which are to be tabled in Parliament and referred to the House of Commons Standing Committee on Government Operations and Estimates
Public Service Superannuation Act—Clauses 210 to 216 and 217 to 222
- Clauses 210 to 216 amend the Public Service Superannuation Act (PSSA) to redefine operational service, establish special pension plans for correctional and other operational workers, prescribe additional contribution requirements, and grant regulation-making authority for operational service designations and pension calculations
- Clauses 217 to 220 introduce workforce reduction measures allowing public service contributors aged 50 and over (or 55 and over depending on the provision) with at least 10 years of service to access immediate annual allowances without early retirement penalties, subject to Treasury Board approval within specified timeframes (120 days for approvals, 300 days for cessation of employment)
- Clauses 221 to 222 make related amendments to Income Tax Regulations to exempt certain Public Service Superannuation Act benefits from standard conditions when arising from Treasury Board waivers of early retirement reductions granted before 2028, with provisions coming into force on the later of royal assent or January 15, 2026
- The policy authority rests with the President of the Treasury Board and Treasury Board of Canada Secretariat (TBS), who would be responsible for addressing questions related to legislative amendments and their financial implications; as per typical protocol at this stage in the parliamentary process, questions regarding the legislative amendments should be directed to TBS, while Public Services and Procurement Canada, as the day-to-day administrator of the PSSA, would only respond to questions regarding existing program operations
Building Canada Act: Clause 592
- The public registry of national interest projects must now include information on how a project contributes to clean growth and how it meets Canada’s objectives with respect to climate change
Full bill text
Clauses 195 to 199 regarding Canada Post, Division 2
Canada Post Corporation Act
R.S., c. C-10
Amendments to the Act
195 The definition “library material” in subsection 2(1) of the Canada Post Corporation Act is repealed.
196 The Act is amended by adding the following after section 16:
Postage
16.1 (1) The Corporation may establish rates of postage and the terms and conditions related to the payment of the postage.
Fair and reasonable rates
(2) In establishing rates of postage, the Corporation must have regard to whether they are fair and reasonable and consistent so far as possible with providing a revenue that, together with any revenue from other sources, is sufficient to defray the costs incurred by the Corporation in carrying out its objects under this Act.
Exception: fair and reasonable rates
(3) Despite subsection (2), the Corporation is not required to have regard to whether a rate is fair and reasonable and consistent so far as possible with providing a revenue that, together with any revenue from other sources, is sufficient to defray the costs incurred by the Corporation in carrying out its objects under this Act, for rates that it establishes for a person who has entered into an agreement with the Corporation for
(a) the variation of rates of postage on the mailable matter of that person in consideration of their mailing it in bulk, preparing it in a manner that facilitates its processing or receiving additional services in relation to it; or
(b) the provision of experimental services related to the business of the Corporation for any period not exceeding three years.
Publicly available
(4) The Corporation must make any rates and terms and conditions that it establishes under subsection (1) publicly available as soon as feasible after establishing them.
Exception: publicly available
(5) Despite subsection (4), the Corporation is not required to make publicly available rates and terms and conditions that it establishes for a person who has entered into an agreement with the Corporation for
(a) the variation of rates of postage on the mailable matter of that person in consideration of their mailing it in bulk, preparing it in a manner that facilitates its processing or receiving additional services in relation to it; or
(b) the provision of experimental services related to the business of the Corporation for any period not exceeding three years.
Refund
(6) The Corporation may refund postage.
197 (1) Paragraphs 19(1)(d) to (g.1) of the Act are repealed.
(2) Subsections 19(2) and (3) of the Act are repealed.
198 Sections 21 to 21.2 of the Act are repealed.
Coming into force
Order in council
199 This Division comes into force on a day to be fixed by order of the Governor in Council.
Clauses 203 to 209 regarding Red Tape Reduction
Section 5
Red Tape Reduction Act
2015, c. 12
Amendments to the Act
203 (1) The last paragraph of the preamble to the English version of the Red Tape Reduction Act is replaced by the following:
Whereas the Government of Canada recognizes the importance of being transparent with regard to the implementation of the one-for-one rule;
(2) The preamble to the Act is amended by adding the following after the last paragraph:
And whereas the Government of Canada recognizes the importance of facilitating, in a transparent manner, the design, modification or administration of regulatory regimes to encourage innovation, competitiveness or economic growth while protecting public health and safety and the environment;
204 The heading before section 2 of the Act is replaced by the following:
Part 1
Control of Administrative Burden
Interpretation, Application and Purpose
205 The portion of section 2 of the Act before the first definition is replaced by the following:
Definitions
2 The following definitions apply in this Part.
206 The heading before section 3 and sections 3 and 4 of the Act are replaced by the following:
Application
3 This Part applies to regulations made by or with the approval of the Governor in Council, the Treasury Board or a minister of the Crown.
Purpose
4 The purpose of this Part is to control the administrative burden that regulations impose on businesses.
207 Section 8 of the Act is replaced by the following:
Immunity
8 (1) No action or other proceeding may be brought against His Majesty in right of Canada for anything done or omitted to be done, or for anything purported to be done or omitted to be done, under this Part.
Validity of regulations
(2) No regulation is invalid by reason only of a failure to comply with this Part.
208 Section 11 of the Act and the heading before it are replaced by the following:
Part 2
Exemptions to Encourage Innovation, Competitiveness or Economic Growth
Definition
Definition of “entity”
11 In this Part, “entity” includes an individual, a corporation, a partnership, an unincorporated association or organization and His Majesty in right of Canada or of a province.
Exemptions
Order
12 (1) Subject to subsections (3) and (7), a minister may, by order, for a specified validity period of not more than three years and on any terms that the minister considers appropriate, exempt an entity from the application of
(a) a provision of an Act of Parliament, except the Criminal Code, if the minister is responsible for the Act;
(b) a provision of an instrument made under an Act of Parliament, except an instrument made under the Criminal Code, if
(i) the minister is responsible for the Act, or
(ii) the body that made the instrument is accountable, through the minister, to Parliament for the conduct of its affairs; or
(c) a provision of an Act of Parliament, except the Criminal Code, or a provision of an instrument made under an Act of Parliament, except an instrument made under the Criminal Code, if the minister administers or enforces the provision.
Requests not required to be considered
(2) A minister is not required to consider a request for an exemption.
Conditions
(3) A minister may make an order under subsection (1) only if the minister is of the opinion that
(a) the exemption is in the public interest;
(b) the exemption would enable the testing of, among other things, a product, service, process, procedure or regulatory measure with the aim of facilitating the design, modification or administration of a regulatory regime to encourage innovation, competitiveness or economic growth;
(c) the benefits associated with the exemption outweigh the risks;
(d) sufficient resources exist, and appropriate measures will be taken, to maintain oversight of the testing, manage any risks associated with the exemption and protect public health and safety and the environment; and
(e) a feasible implementation plan has been developed.
Exemption continues in force
(4) For greater certainty, an exemption granted under subsection (1) continues in force until the end of the validity period specified in the order even if the testing referred to in paragraph (3)(b) is completed before the end of that period.
Amendment or extension
(5) Subject to subsection (8), a minister who has made an order under subsection (1) may, by order and on any terms the minister considers appropriate, amend it or extend the validity period of the exemption for a total period not exceeding six years only if the minister is of the opinion that
(a) the conditions set out in paragraphs (3)(a) and (c) are met;
(b) the amended exemption or extension would enable the testing referred to in paragraph (3)(b) to continue or, if such testing is already complete, would facilitate the design, modification or administration of a regulatory regime as a result of that testing;
(c) sufficient resources exist, and appropriate measures will be taken, to maintain oversight of any continuing testing, manage any risks associated with the amended exemption or extension, and protect public health and safety and the environment; and
(d) a feasible implementation plan has been developed that takes into account the amendment or extension.
Revocation or suspension
(6) A minister who has made an order under subsection (1) may, by order, revoke it or suspend its application in whole or in part.
Two or more ministers
(7) If, under subsection (1), two or more ministers may, by order, exempt the same entity from the application of the same provision, the entity may be exempted only if the ministers jointly make an order under that subsection with respect to the entity and provision.
Two or more ministers: amendment, extension, revocation and suspension
(8) The following provisions apply if, in accordance with subsection (7), two or more ministers have jointly made an order:
(a) the order may be amended only if the ministers jointly make an amending order under subsection (5);
(b) the validity period of the exemption may be extended only if the ministers jointly make an extension order under subsection (5); and
(c) the order made under subsection (1) is revoked or its application is suspended, in whole or in part, if one of the ministers makes a revocation or suspension order, as the case may be, under subsection (6).
Statutory Instruments Act
(9) An order made under this section is not a “statutory instrument” within the meaning of the Statutory Instruments Act.
Exemptions under other Acts
13 For greater certainty, the power to make an order under section 12 does not preclude or limit the exercise of a power to exempt under another Act of Parliament and vice versa.
Transparency and Parliamentary Oversight
Accessibility
14 (1) Subject to subsections (2) and (3), a minister must, as soon as feasible after making an order under section 12, make the order and the following information publicly accessible:
(a) a description of the decision-making process and a summary of the reasons for the order; and
(b) a description of the process for providing comments or information to, or requesting information from, the minister in relation to the order.
Exception
(2) The minister may exclude information that, in the minister’s opinion, would be inappropriate to make publicly accessible for reasons that include safety or security considerations or the protection of confidential or personal information.
Two or more ministers: accessibility
(3) If two or more ministers have jointly made an order in accordance with subsection 12(7) or (8), each of them must make publicly accessible the order and the same information under paragraphs (1)(a) and (b), with the same exclusions, if any, under subsection (2).
Report
15 (1) Subject to subsection (2), the President of the Treasury Board must prepare and make public each year a report on the application of section 12 during the 12-month period ending on March 31 of the year in which the report is to be made public. The report must include a list of the orders made under section 12 that were in effect during that period and the names of the ministers who made them.
Exception
(2) The President of the Treasury Board is not required to prepare a report if no orders made under section 12 were in effect during the period referred to in subsection (1).
Tabling
(3) The President of the Treasury Board must cause the report referred to in subsection (1) to be laid before each House of Parliament on any of the first 15 days on which that House is sitting after the day on which the report is made public.
Referral to committee
(4) The report must be referred to the Standing Committee on Government Operations and Estimates of the House of Commons or, if there is not a Standing Committee on Government Operations and Estimates, the appropriate committee of the House of Commons.
Coordinating Amendments
2018, c. 12
209 (1) In subsections (2) and (3), “other Act” means the Budget Implementation Act, 2018, No. 1.
(2) If section 206 of this Act comes into force before section 259 of the other Act, then that section 259 is repealed.
(3) If section 206 of this Act comes into force on the same day as section 259 of the other Act, then that section 259 is deemed to have come into force before that section 206.
Clauses 210 to 216 and 217 to 222 regarding Public Service Superannuation Act
Division 6
Public Service Superannuation Act (operational service)
R.S., c. P-36
Amendments to the Act
210 The heading before section 24.1 and sections 24.1 and 24.2 of the Public Service Superannuation Act are replaced by the following:
Operational Service
Definition of “operational service”
24.1 (1) In sections 24.2 to 24.6, “operational service” means, subject to any order made under subsection (2), service of a kind designated in the regulations that is carried out in any institutions or other premises that are designated in the regulations in respect of that kind of service. It also includes any periods of time spent away from that service that are specified in the regulations.
Ministerial order
(2) The Minister may, by order, narrow the scope of a kind of service that is designated in the regulations.
Special pension plan
24.2 (1) Any person referred to in subsection (2) who was required by subsection 5(1.1) or (1.2), as it read on December 31, 2012, to contribute to the Superannuation Account or the Public Service Pension Fund or who is required by subsection 5(2) to contribute to the Public Service Pension Fund is entitled, at their option on ceasing to be employed in the public service, in respect of the operational service that is pensionable service to their credit—subject to the election they may make under subsection (3)—to an immediate annuity or annual allowance calculated in the manner prescribed by the regulations, in the circumstances and subject to the terms and conditions prescribed by those regulations, in lieu of any benefit to which that person is otherwise entitled under subsection 13(1) or 13.001(1) in respect of that service.
Persons to whom subsection (1) applies
(2) Subsection (1) applies to
(a) any person employed in operational service—within the meaning of that expression on the day before the day on which this subsection comes into force—by the Correctional Service of Canada on or after March 18, 1994; and
(b) any person, other than a person referred to in paragraph (a), employed in any kind of operational service on or after the date prescribed by the regulations for that kind of service.
Election—operational service
(3) Any person referred to in subsection (2) may, subject to the regulations, elect not to count pensionable service to their credit as operational service for the purposes of subsection (1).
Amendment or revocation
(4) Any person who makes an election under subsection (3) may, subject to the regulations, amend or revoke the election.
Non-application of section 8
(5) Section 8 does not apply in respect of an election made under subsection (3).
211 Subsection 24.4(1) of the Act is replaced by the following:
Additional amount to be contributed
24.4 (1) Subject to subsections (2) and 5(6), any person referred to in subsection 24.2(2) who is required by subsection 5(2) to contribute to the Public Service Pension Fund is, except in the circumstances described in subsection 5(3) or prescribed by the regulations, required to contribute to the Public Service Pension Fund by reservation from salary or otherwise, in addition to any other amount required under this Act, any percentage of their salary that is determined by the Treasury Board on the recommendation of the Minister, which recommendation is to be based on actuarial advice.
212 Section 24.6 of the Act is replaced by the following:
Adjustment of annuity or annual allowance
24.6 If a person who was employed in operational service and who is receiving an annual allowance payable under subsection 24.2(1) is subsequently re-employed in the public service, the amount of any annuity or annual allowance to which the person may become entitled under this Part on again ceasing to be employed in the public service shall be adjusted in accordance with regulations made under paragraph 42(1)(x.1) to take into account the amount of any annual allowance that the person has received.
213 (1) Paragraphs 42.1(1)(m) to (q) of the Act are replaced by the following:
(m) for the purposes of the definition “operational service” in subsection 24.1(1), designating the kind of service and the institutions or other premises in which that kind of service is carried out and specifying the periods of time spent away from operational service that are to be included within the meaning of that definition;
(n) prescribing the terms and conditions subject to which a person who ceases to be employed in “operational service,” as defined in subsection 24.1(1), but continues to be employed in the public service may elect to be deemed to be employed in operational service while the person continues to be so employed;
(o) respecting the determination of the effective date on which a person shall be deemed to have become or to have ceased to be employed in “operational service,” as defined in subsection 24.1(1);
(p) prescribing, for the purposes of sections 24.2 and 24.3 and any regulations made under this subsection, the terms and conditions subject to which any service before, on or after the coming into force of those sections may be counted as “operational service,” as defined in subsection 24.1(1), that is pensionable service;
(q) prescribing the circumstances in which and the terms and conditions subject to which a person is entitled, at the person’s option, to an immediate annuity or annual allowance under subsection 24.2(1), prescribing the manner of calculating or adjusting that immediate annuity or annual allowance and prescribing the circumstances in which the person is deemed to have exercised the option in favour of either an immediate annuity or annual allowance;
(r) prescribing the date on which paragraph 24.2(2)(b) applies to a person employed in service of a given kind;
(r.1) prescribing the circumstances in which and the terms and conditions subject to which an election may be made under subsection 24.2(3), the period within which it may be made and the manner of making it;
(r.2) prescribing the circumstances in which and the terms and conditions subject to which a person may amend or revoke an election under subsection 24.2(4), the period within which it may be amended or revoked and the manner of amending or revoking it;
(r.3) prescribing the circumstances in which a person is not required to make a contribution under subsection 24.4(1);
(2) Paragraph 42.1(1)(t) of the Act is replaced by the following:
(t) requiring the Minister to credit additional amounts to the Superannuation Account, or to pay additional amounts into the Public Service Pension Fund, in respect of “operational service,” as defined in subsection 24.1(1), that is pensionable service to the credit of a person referred to in subsection 24.2(2) and prescribing the manner and circumstances in which those amounts are to be credited or paid;
214 (1) The portion of the definition “recipient” in section 64 of the Act before paragraph (a) is replaced by the following:
“recipient” means a person who is in receipt of a pension, but does not include a person who is in receipt of an immediate annuity or annual allowance under section 16 or subsection 24.2(1) unless
(2) The portion of paragraph (c) of the definition “recipient” in section 64 of the Act before subparagraph (i) is replaced by the following:
(c) that immediate annuity or annual allowance is based on a number of years of “operational service,” as defined in section 15 or subsection 24.1(1), as the case may be, that is pensionable service and that pensionable service consists of not less than
215 Subsection 69(4) of the Act is replaced by the following:
Deemed retirement year
(4) For the purposes of subsection (3), when that subsection is applied in determining under subsection (2) the supplementary benefit payable to a person in respect of a pension payable under subsection 17(2) or 24.2(1), the person is deemed to have ceased to be employed at the time they ceased to be employed in “operational service,” as defined in section 15 or subsection 24.1(1), as the case may be.
Coming into force
Order in council
216 This Division comes into force on a day to be fixed by order of the Governor in Council.
Division 7
Public Service Superannuation Act (workforce reduction)
R.S., c. P-36
Amendments to the Act
217 (1) Subparagraph 13(1)(c)(ii) of the Public Service Superannuation Act is amended by striking out “or” at the end of clause (C) and by adding the following after that clause:
(C.1) subject to subsection (1.1), if at the time the contributor exercises their option under this clause a workforce reduction initiative is in effect, and if at the time they cease to be so employed they have reached 50 years of age and have been employed in the public service for a period of or for periods totalling at least 10 years, an annual allowance, payable immediately on their so ceasing to be employed, equal to the amount of the deferred annuity referred to in clause (A), or
(2) Section 13 of the Act is amended by adding the following after subsection (1):
Limitation on entitlement to annual allowance
(1.1) A contributor is not entitled to an annual allowance under clause (1)(c)(ii)(C.1) unless the Treasury Board approves their entitlement to it based on the criteria that it establishes and the contributor ceases to be employed in the public service during the period that begins on the day on which this subsection comes into force and ends on the 300th day after that day.
Limitation on approval
(1.2) The Treasury Board is not authorized to approve entitlement to an annual allowance referred to in clause (1)(c)(ii)(C.1) after the 120th day after the day on which this subsection comes into force.
218 (1) Subparagraph 13.001(1)(c)(ii) of the Act is amended by striking out “or” at the end of clause (C) and by adding the following after that clause:
(C.1) subject to subsection (1.1), if at the time the contributor exercises their option under this clause a workforce reduction initiative is in effect, and if at the time they cease to be so employed they have reached 55 years of age and have been employed in the public service for a period of or for periods totalling at least 10 years, an annual allowance, payable immediately on their so ceasing to be employed, equal to the amount of the deferred annuity referred to in clause (A), or
(2) Section 13.001 of the Act is amended by adding the following after subsection (1):
Limitation on entitlement to annual allowance
(1.1) A contributor is not entitled to an annual allowance under clause (1)(c)(ii)(C.1) unless the Treasury Board approves their entitlement to it based on the criteria that it establishes and the contributor ceases to be employed in the public service during the period that begins on the day on which this subsection comes into force and ends on the 300th day after that day.
Limitation on approval
(1.2) The Treasury Board is not authorized to approve entitlement to an annual allowance referred to in clause (1)(c)(ii)(C.1) after the 120th day after the day on which this subsection comes into force.
219 The Act is amended by adding the following after section 44.2:
Payment—waiver of reductions
44.21 Despite subsection 43(1) of this Act and section 21 of the Special Retirement Arrangements Act, the amount of the reduction provided for by clause 13(1)(c)(ii)(C) or 13.001(1)(c)(ii)(C) that, under either of those clauses, is waived by the Treasury Board during the period that begins on the day on which this section comes into force and ends on the 300th day after that day, is to be charged to the Public Service Pension Fund and paid out of the assets of the Public Sector Pension Investment Board.
Payment—difference in amounts
44.22 Despite subsection 43(1) of this Act and section 21 of the Special Retirement Arrangements Act, the difference between the amount of the annual allowance that is payable to a contributor under clause 13(1)(c)(ii)(C.1) or 13.001(1)(c)(ii)(C.1)—and the amount of the annual allowance that would have been payable to them had they exercised an option under clause 13(1)(c)(ii)(B), (C) or (D) or 13.001(1)(c)(ii)(B), (C) or (D) and ceased to be employed in the public service at the same time as they in fact ceased to be so employed—is to be charged to the Public Service Pension Fund and paid out of the assets of the Public Sector Pension Investment Board.
220 The Act is amended by adding the following after section 46:
Transitional provisions
Definition of “transitional period”
46.01 (1) In this section, “transitional period” means the period that begins on the day on which clauses 13(1)(c)(ii)(C.1) and 13.001(1)(c)(ii)(C.1) come into force and ends on the 120th day after that day.
Application
(2) This section applies to a contributor who, during the transitional period, exercised an option under clause 13(1)(c)(ii)(C.1) or 13.001(1)(c)(ii)(C.1) but remained employed in the public service.
Continuation—power to approve
(3) Despite subsections 13(1.2) and 13.001(1.2), during the period that begins on the first day after the day on which the transitional period ends and ends on the 179th day after that first day, the Treasury Board is authorized, in respect of contributors to whom this section applies, to approve, based on the criteria established by the Treasury Board, their entitlement to an annual allowance referred to in clause 13(1)(c)(ii)(C.1) or 13.001(1)(c)(ii)(C.1).
C.R.C., c. 945
Related amendment to the Income Tax Regulations
221 Subsection 8503(13) of the Income Tax Regulations is amended by striking out “and” at the end of paragraph (a), by adding “and” at the end of paragraph (b) and by adding the following after paragraph (b):
(c) the conditions in section 8303, paragraph (3)(c) and section 8504 do not apply in respect of benefits provided to a member under the pension plan established by the Public Service Superannuation Act if the benefits arise as a result of a waiver granted by the Treasury Board, before 2028, of any early retirement reductions in respect of the member that would otherwise apply under that Act or under the Retirement Compensation Arrangements Regulations, No. 1.
Coming into force
January 15, 2026 or royal assent
222 (1) Sections 217 to 219 and 221 come into force on the later of the day on which this Act receives royal assent and January 15, 2026.
121st day after the coming into force of section 217
(2) Section 220 comes into force on the 121st day after the day on which section 217 comes into force.
Clause 592 regarding Building Canada Act
Division 40
Building Canada Act
2025, c. 2, s. 4
592 Paragraph 5.1(2)(b) of the Building Canada Act is replaced by the following:
(b) the extent to which the project is expected to meet the outcomes set out in paragraphs 5(6)(a) to (e);
3. Public Services and Procurement Canada's Contribution to Budget 2025 Savings Plan
Issue
Budget 2025 focuses on: building a stronger Canadian economy; shifting from reliance to resilience; empowering Canadians; protecting Canada’s sovereignty and security; and creating a more efficient and effective Government.
Key facts
- Budget 2025 identifies $13 billion in annual savings by 2028–2029 across more than 100 federal organizations through the Comprehensive Expenditure Review
- Public Services and Procurement Canada’s contribution represents $642.3 million over 4 years, starting in 2026–2027, and $190.2 million ongoing
Key messages
- We are committed to responsible fiscal management and delivering value for Canadians. To meet the up to 15% in savings targets over three years, Public Services and Procurement Canada will focus on the government's priorities while demonstrating accountability for our decisions and a commitment to results
- The department is making changes to update how it works, move more services online, and save money
- It is also re-engineering internal processes to reduce administrative requirements and de-layer management. This includes better managing project delivery and reducing spending on professional services and travel, as well as focusing on core mandates
Background
The Comprehensive Expenditure Review is a government-wide initiative to ensure fiscal sustainability while maintaining essential services for Canadians. At Public Services and Procurement Canada, achieving these savings will involve multiple measures including:
- Strategic realignments to reduce ongoing costs to operate programs and efficiently deliver services as a common service provider for the government
- Reducing ongoing costs for its Real Property Revolving Fund by focusing on core mandates and reducing duplicative functions
- Winding down activities of the Canada General Standards Board, as this optional service will be better served via alternative organizations given that there are 15 other accredited standards development organizations operating in Canada
- Reducing funding to pilot and innovation projects for Laboratories Canada
- Advancing digital delivery of procurement-related documents and implementing Artificial Intelligence chatbots and self-service tools
4. Procurement of official languages interpretation services
Issue
The Translation Bureau’s interpretation services are essential to the functioning of the House of Commons, the Senate and their respective committees.
Key facts
- In 2024–2025, the Translation Bureau provided 20,528 hours of official languages interpretation to Parliament, representing $21.8 million in spending
- The Translation Bureau uses suppliers for approximately 40% of the demand for interpretation in official languages in Parliament
- Public Services and Procurement Canada’s new request for standing offer took place from October 24 to November 24, 2025, for potential suppliers who were already accredited by the Translation Bureau
- The second planned solicitation period, held between December 24, 2025 and January 16, 2026, aimed to accommodate the 10 interpreters who passed the accreditation exam in November 2025
- If needed, the Translation Bureau could also use ad hoc contracts to meet Parliament's needs
Key messages
- In fall 2025 and early January 2026, Public Services and Procurement Canada issued a request for a standing offer for official languages interpretation services for Parliament and other high-profile events
- The purpose of the request for a standing offer was to provide greater flexibility, reduce the administrative burden, and lower costs while better aligning with industry standards
- Since January 2026, 34 new standing offers have been issued for a total of 36 interpreters
- The Translation Bureau remains fully committed to providing quality interpretation services tailored to the needs of our clients, budgetary realities and the expectations of Canadians
If pressed on the accreditation process:
- The November 2025 exam applied the same rigorous assessment criteria as in previous years
- To uphold transparency and support continuous improvement, the Translation Bureau invited two independent experts (one internal and one external) to provide an external perspective on the evaluations
- Final decisions regarding accreditation are made solely by the Translation Bureau
- Seven (7) private-sector candidates and three (3) Translation Bureau interpreters successfully passed the November 2025 accreditation exam (out of a total of 60 candidates)
If pressed on the Office of the Procurement Ombud reports
- Public Services and Procurement Canada takes its responsibilities in administering interpretation service contracts very seriously, and acknowledges the findings raised by the Procurement Ombud
- The department is currently assessing the next steps in response to the recommendations made by the Procurement Ombud
If pressed on the impact of choosing the lowest bidder on the quality of interpretation:
- Interpretation quality is ensured not by the price offered, but through a rigorous mandatory supplier accreditation process, additional requirements, and ongoing (quality) performance monitoring
Background
The Translation Bureau relies on suppliers for about 40% of its official languages interpretation needs in Parliament and 80% for assignments outside Parliament.
To replace contracts expiring on December 31, 2025, Public Services and Procurement Canada (PSPC) launched a Request for Information at the end of June 2025, which closed on August 8, 2025. In designing the new procurement tool, a request for standing offer, input from nearly 50 suppliers was taken into account.
The request for standing offer was published on October 24, 2025, with an initial closing date of November 24, 2025, for suppliers already accredited by the Translation Bureau. A second closing date of January 16, 2026, has been set to allow candidates who successfully passed the most recent accreditation exam to submit their bids. The accreditation exam seeks to guarantee that interpreters have the expertise required to respond to Parliament’s demands. Of the 60 candidates who sat the exam, 54 were external candidates and 6 were employees of the Translation Bureau. A total of 10 candidates successfully passed the exam.
Between June and August 2025, 4 Canadian suppliers filed written complaints with the Office of the Procurement Ombud (OPO) about the administration of their respective PSPC-awarded contracts for “parliamentary interpretation and conference services.” OPO addressed each complaint in a separate report.
The OPO concluded that the work had not been assigned by the department in compliance with the terms of the contract.
To strengthen oversight, PSPC has already implemented corrective measures, including the centralization of the work assignment function under a single authority. Additional measures will also be implemented, including enhanced training, clearer internal directives, and improved recordkeeping practices.
5. Buy Canadian
Issue
On December 16, 2025, the Government of Canada announced the coming into force of core elements of the Buy Canadian Policy to strengthen domestic industries and ensure federal procurement spending benefits Canadian businesses.
Key facts
- In fiscal year 2024–2025, Public Services and Procurement Canada, as Canada’s central purchasing agent, awarded $55.6 billion in contracts for goods, services and construction. Of this, approximately $50.9 billion (91%) was awarded to suppliers operating in Canada
- Between April and December 2025, Public Services and Procurement Canada, as a common service provider, awarded 1,078 contracts and amendments for approximately $2.3 billion to suppliers located outside of Canada. Of this amount, 376 contracts and amendments were awarded for defence purposes representing 88% ($2.0 billion) of the total value
Key messages
- Effective December 16, 2025, the government rolled out the core elements of Buy Canadian and new procurement rules that apply across all federal institutions
- The new policies help create strong Canadian supply chains by prioritizing Canadian suppliers and Canadian-made goods and services whenever possible in major federal acquisitions
- These measures support key Canadian sectors, including steel, aluminum and wood products, and help Canadian industries become more self-sufficient and resilient to changes in the global economy
Background
On September 5, 2025, the Prime Minister announced an expanded Buy Canadian Policy that introduces a suite of new measures to prioritize Canadian suppliers, materials, and innovation across federal procurement and funding programs.
On November 4, 2025, the Prime Minister outlined nearly $186 million in new funding from Budget 2025 to fully implement the Buy Canadian Policy and ensure it delivers lasting results for Canadian businesses and workers.
On December 16, 2025, the Minister of Government Transformation, Public Works and Procurement and Quebec Lieutenant, announced the coming into force of core elements of the Buy Canadian Policy, which fundamentally change how the federal government purchases goods and services.
Public Services and Procurement Canada developed the Buy Canadian Procurement Policy Framework that encompasses a number of new measures.
Policies under the framework that have come into force, effective December 16, 2025, include:
- The Policy on Prioritizing Canadian Suppliers and Canadian Content in Strategic Federal Procurement that gives priority to Canadian businesses and Canadian content for major federal procurements. This applies immediately to large, strategic procurements valued at $25 million and over, and will expand to contracts valued at $5 million and above by spring 2026; and
- The Policy on Prioritizing Canadian Materials in Federal Procurement that requires suppliers working on defence and construction contracts valued at $25 million and over to use Canadian steel, wood products and aluminum where these inputs are necessary. The Policy will have the required flexibility to introduce additional materials as required
Measures that are expected by spring 2026 include:
- Full implementation of the Policy on Reciprocal Procurement to further restrict eligibility for non-defence procurements to Canadian goods and services or those from our trusted trade partners. These new measures build on the Interim Reciprocal Procurement Policy that launched in July 2025, which limited the federal non-defence procurement market to suppliers located in Canada and from our trading partners; and
- Launch of a Small and Medium Business Procurement Program that will create specific streams of procurement for small and medium businesses and will also help them navigate the federal procurement system more easily
Canada Post
6. Canada Post financial stability
Issue
Canada Post is facing existential financial challenges driven by lower revenues resulting from the decline in letter mail volumes and the increasingly competitive parcel market. To address these challenges, Canada Post has submitted its comprehensive transformation plan to return the corporation to financial self-sustainability to the Minister.
Key facts
- On September 25, 2025, the Minister of Government Transformation, Public Works and Procurement and Quebec Lieutenant instructed Canada Post to provide, within 45 days, a comprehensive transformation plan to not only implement the recommendations of the Industrial Inquiry Commission but also to propose additional measures to restore the corporation to financial solvency, including reducing its management and overhead costs
- In November 2025, Canada Post reported a $541 million loss before tax in the third quarter, its worst recorded quarterly result, indicating that the $1.034 billion in repayable funding provided in 2025 would run out earlier than expected and that it will require additional funds in 2026 and beyond to continue operations
- On January 28, 2026, Canada Post and the Canadian Union of Postal workers announced they had finalized tentative collective agreements
Key messages
- As our government reviews its balance sheet so we can spend less and invest more, we have asked Canada Post to do the same
- Canada Post is effectively insolvent, and repeated bailouts are not a long-term solution. This situation is unsustainable and transformation is required to ensure the survival of Canada Post and protect the services Canadians rely on
- I received Canada Post’s comprehensive transformation plan in November 2025, and I am reviewing it carefully
- The Government of Canada has removed long-standing barriers to postal reform, and now Canada Post must take decisive action to deliver the services Canadians need in a way that is financially sustainable
If pressed on the labour situation:
- The government is pleased that a tentative agreement has been reached between Canada Post and the Canadian Union of Postal Workers and looks forward to its ratification by postal workers
If pressed on the need for additional funding:
- The government will ensure Canada Post has the necessary liquidity to continue operating and delivering services to Canadians while it transforms
Background
Over the last 20 years, the amount of mail Canadians receive has declined by 70%, while the number of addresses has increased by more than three million. This has resulted in lower revenues and higher costs for Canada Post. Canada Post’s legislated mandate requires it to be financially self-sustaining, but it has reported over $5.5 billion in operating losses since 2018, including more than $1 billion in the first three quarters of 2025 alone. These pressures have been compounded by the uncertainty caused by the 2-year long labour negotiations and various strike actions by the Canadian Union of Postal Workers in 2024 and 2025.
In December 2024, William Kaplan was appointed to lead an Industrial Inquiry Commission to examine Canada Post’s financial challenges in the context of the collective bargaining dispute. The Industrial Inquiry Commission report, submitted on May 15, 2025, outlined structural and financial challenges faced by Canada Post and made recommendations.
On September 25, 2025, the Government announced it was accepting the recommendations of the Industrial Inquiry Commission and instructed Canada Post to develop a comprehensive transformation plan, given that additional measures would be necessary to return the Corporation to financial solvency.
On November 7, 2025, Canada Post submitted its comprehensive transformation plan to the Minister of Government Transformation, Public Works and Procurement and Quebec Lieutenant. The plan lays out an implementation strategy for conversions to community mailboxes, modernizing its network of post offices (following the lifting of the rural moratorium, while ensuring the maintenance of service to rural, remote, and Indigenous communities), amending service standards for letter mail and reducing its management and overhead costs.
On January 28, 2026, after more than two years of negotiations, Canada Post and the Canadian Union of Postal workers announced they had finalized tentative agreements that would expire on January 31, 2029. Language is set to be finalized soon, and ratification is expected shortly thereafter. This will put an end to a two-year period of labour uncertainty that has deeply damaged Canada Post’s bottom line. While the agreements are subject to ratification by union membership, no strike or lockout actions will take place during this process, meaning Canadians can look toward to an extended period of labour peace—until January 31, 2029—that will enable Canada Post to begin its transformation.
As part of Budget 2025, the Government is also proposing amendments to the Canada Post Corporation Act to deregulate the stamp rate-setting process and enable Canada Post to set stamp rates, without the approval of the Governor in Council, in line with recommendation number 7 of the Industrial Inquiry Commission.
7. Canada Post Transformation
Issue
The Government has instructed Canada Post to take steps to transform its operations and work toward becoming financially self-sustaining.
Key facts
- Canada Post’s legislated mandate requires it to be financially self-sustaining, but it has reported over $5 billion in operating losses since 2018
- In November 2025, Canada Post reported a $541 million dollar loss before tax in the third quarter, marking its largest quarterly loss in history
Key messages
- Canadians deserve serious action to begin transforming Canada Post in response to the scale and urgency of its financial challenges. Inaction is not an option
- As such, I have instructed Canada Post to operationalize changes to letter delivery standards, proceed with community mailbox conversions, and to right‑size and transform the retail post office network, while protecting access in rural, remote and underserved areas
- This marks the first step in a multi-year transformation that will set Canada Post on a better and more sustainable financial path
- In November, Canada Post submitted its transformation plan to me, and I am carefully reviewing the Plan
If pressed on the updates to letter delivery standards:
- To reflect worldwide decline in mail volumes and improve efficiency, Canada Post will update letter mail delivery standards and transition toward a more flexible, volume-based delivery approach
If pressed on community mailbox conversion:
- Increasing centralized delivery, which already serves 72% of Canadians, will save over $350 million annually, once fully implemented
- Canada Post will consult with affected communities and enhance its delivery accommodation program, which includes door-to-door delivery for Canadians with accessibility challenges
If pressed on ending the rural moratorium:
- The government knows that the post office is often a lifeline for rural and remote communities, but it is time to modernize the 1994 moratorium
- I have instructed Canada Post to return to me with a plan that will protect access in rural and remote communities and underserved areas before any post office closure occurs
If pressed on the regulated stamp rate-setting process:
- As part of Budget 2025, the Government proposed amendments to the Canada Post Corporation Act to modernize and streamline the regulated stamp rate-setting process by enabling Canada Post to adjust postage without Governor in Council approval
Background
In May 2025, William Kaplan was appointed to lead an Industrial Inquiry Commission (IIC) to examine Canada Post’s financial challenges in the context of the collective-bargaining dispute, with special attention to the underlying causes of the dispute.
The IIC’s report, submitted on May 15, 2025, outlined structural and financial challenges faced by Canada Post and made recommendations for both the Government and for collective bargaining, to return Canada Post to some degree of financial sustainability so it can continue, but in a manner that reflects 2025 realities.
On September 25, 2025, the Government announced it was accepting the recommendations of the IIC and instructed Canada Post to develop a comprehensive transformation plan, given that additional measures would be necessary to return the Corporation to financial solvency.
On November 7, 2025, Canada Post submitted its comprehensive transformation plan to the Minister of Government Transformation, Public Works and Procurement and Québec Lieutenant. The plan lays out an implementation strategy for conversions to community mailboxes, modernizing its network of post offices (following the lifting of the rural moratorium, while ensuring the maintenance of service to rural, remote, and Indigenous communities), amending service standards for letter mail and reducing its management and overhead costs.
On January 28, 2026, Canada Post and the Canadian Union of Postal Workers, announced they had finalized tentative agreements covering both bargaining units, to be ratified by members in early 2026. This will put an end to a two-year period of labour uncertainty that has deeply damaged Canada Post’s bottom line. While the agreements are subject to ratification by union membership, no strike or lockout actions will take place during this process, meaning Canadians can look toward to an extended period of service reliability—until January 31, 2029—that will enable Canada Post to begin its transformation.
8. Canada Post: Budget 2025 Implementation Act
Summary
In Budget 2025, the Government announced its intention to amend the Canada Post Corporation Act to modernize the stamp rate setting process to allow Canada Post to more expediently update stamp rates.
Key messages
- The proposed amendments to the Canada Post Corporation Act are a response to recommendations from the Industrial Inquiry Commission to streamline Canada Post operations and reduce the red tape associated with the approval process for postage rate changes
- Deregulating stamp rates is part of the transformation of Canada Post. It will streamline the process for changing stamp rates, which will help ensure the corporation can meet evolving needs of Canadians in a more financially sustainable manner
- Canada Post will still be required to ensure rates are fair, reasonable, publicly available, and sufficient to cover its costs, as outlined in the Canada Post Corporation Act
- The proposed amendments are administrative in nature and are not changes in policy direction or services to persons with disabilities or libraries
- Removing the regulatory provisions relating to material for the use of the blind and library materials was made to ensure consistency and clarity by establishing a single, deregulated rate setting process, thereby reducing red tape
If pressed on commitments to free postage for materials for the blind or reduced postage rates for libraries:
- Canada Post will continue to deliver materials free of postage through its Literature for the Blind program, as well as provide reduced rates for library materials
- The government’s commitment to free and discounted services will continue to be reinforced through Ministerial oversight
- Annual Ministerial letters of expectations to Canada Post’s Board of Directors will notably continue to provide policy direction to guide its strategic decisions, including on stamp rates and, more importantly, on the continuation of free postage for materials for the blind and reduced postage for libraries
- Canada Post will also include any proposed stamp rate increase in its corporate plan, which must be submitted on an annual basis for recommendation by me as the Minister and for approval by Treasury Board of Canada
If pressed on the history of postal services to the blind or libraries:
- Canada has provided free postage for materials used by people who are blind since 1898 to meet its obligations under the Universal Postal Convention. That Convention has acted as a safeguard both before the Canada Post Corporation Act existed, and will continue to do so after the amendments through the Budget Implementation Act
- Similarly, the library book rate has existed since 1939, long before amendments concerning library materials were made to the Canada Post Corporation Act in 2013
If pressed on appropriations to Canada Post:
- The deregulation of the postage rate setting process will not impact the annual funding provided to Canada Post for providing these programs. The funding will continue to be provided through the main estimates
- In 2024–2025, $22.2 million was provided to Canada Post to offset costs associated with delivering public policy programs for the government:
- Parliamentary mail sent to households and materials for the use of the blind are mailed free of charge
- Parliamentarians’ neighbourhood mail and library materials are mailed at a discounted rate
Red tape reduction
9. Red tape reduction measures
Issue
In response to the red tape review process led by the President of the Treasury Board, Public Services and Procurement Canada and the National Capital Commission reviewed their regulations to reduce administrative burden, modernize processes and eliminate outdated regulations.
Key facts
- Public Services and Procurement Canada operates under 20 acts and 27 regulations
- In total, through consolidation, comprehensive reviews, and targeted amendments, the department will immediately move to reduce red tape related to 14 of its regulations
Key messages
- To enhance agility, improve clarity, and reflect evolving technologies and practices, Public Services and Procurement Canada is consolidating and revising its regulatory framework by developing new Harmonized Procurement Regulations and updating other operational regulations, such as the Translation Bureau and Controlled Goods Regulations
- Moving forward, all the organizations in my portfolio will continue to seek ways to eliminate red tape in their programs, policies, processes and service delivery
Background
On July 9, 2025, the President of the Treasury Board called on all Ministers with regulatory responsibilities to undertake a 60-day review of their regulatory portfolios to reduce red tape and support a stronger, more inclusive Canadian economy.
Ministers were asked to publish progress reports outlining immediate actions taken, as well as short, medium, and long-term plans to streamline regulations.
For Public Services and Procurement Canada, the list of actions outlined in the progress report include:
- Develop Harmonized Procurement regulations
- Update of the Controlled Goods Regulations
- Review of Translation Bureau Regulations
- Amend the Government Property Traffic Regulations
- Amend the Public Works Nuisances Regulations
- Amend the Seized Property Disposition Regulations
- Amend the Canada Gazette Publication Order, 2014
- Repeal the Selkirk Marine Railway Dry Dock and the Canadian Vickers Dry Dock Regulations
For the National Capital Commission, the list of actions outlined in the progress report include:
- Develop leaner processes for the Federal Land Use, Design and Transaction Approval and Environmental Impact Assessment
- Modernizing the National Capital Act
10. Continuous improvement of the procurement of professional services
Issue
When external resources are used by departments, Public Services and Procurement Canada works to ensure that contracts are structured consistently with value in mind.
Key facts
- Over the last three fiscal years (2022–2023 to 2024–2025), Public Services and Procurement Canada, as a common service provider, has awarded an average of 3,070 contracts and amendments annually for Professional Services, with a total value of approximately $2.8 billion
- Between April 1 to November 1, 2025, Public Services and Procurement Canada, as a common service provider, has awarded 1,298 contracts and amendments for professional services, with a total value of approximately $1.2 billion
Key messages
- Public Services and Procurement Canada is continuously improving and modernizing its procurement practices and instruments for professional services
- The decision to hire public servants or to pursue professional services contracts is made by departments and agencies based on factors such as the availability of specialized expertise in-house, unexpected fluctuations in workload, time-limited projects, and shortages in certain employment groups
- In July 2025, Public Services and Procurement Canada implemented measures to shift professional services procurement toward outcome-based contracting, to limit the value and duration of time-based professional services contracts, and to introduce a new Vendor Performance Management program
Background
Parliamentary inquiries, audits of the Office of the Auditor General and reviews of the Office of the Procurement Ombud on federal government spending on professional services contracts have generated negative media attention and have raised concerns about taxpayer dollars that are spent on professional services.
The Treasury Board Directive on the Management of Procurement requires that business owners carefully consider and document alternative approaches before initiating a procurement for professional services. The Manager’s guide: key considerations when procuring professional services was published in October 2023 to support managers in fulfilling their responsibilities.
Public Services and Procurement Canada (PSPC) is currently developing a streamlined and simplified suite of mandatory methods of supply for the procurement of professional services. While work and consultations are underway, measures were introduced to strengthen contract management practices and ensure better value for money.
In July 2025, PSPC introduced ten strengthened measures to reinforce stewardship, accountability, and value for money in the procurement of professional services across the federal government. These measures respond directly to findings from parliamentary reviews, audits by the Office of the Auditor General, and reports from the Office of the Procurement Ombud.
Collectively, the measures are designed to ensure that professional services contracts are appropriately scoped, competitively awarded, and actively managed, with clearer expectations and stronger controls throughout the contract lifecycle. They limit the size, duration, and growth of task-based contracts; require greater scrutiny of pricing and amendments; strengthen invoice verification and performance oversight; and introduce additional senior-level approvals and reporting where risks are higher. At the same time, they support a gradual transition toward outcomes-based contracting.
These measures ensure that when external resources are used, decisions are well-documented, defensible, and demonstrably aligned with value for money.
On September 2, 2025, PSPC implemented a new Vendor Performance Management framework to assess vendor performance and use past performance information in awarding contracts. This new framework complements the existing Vendor Performance and Corrective Measures (VPCM) policy that triggers suspension or other corrective measures when a contract is terminated for default. PSPC is currently working on implementing this framework for professional services supply arrangements.
11. Office of Supplier Integrity and Compliance
Issue
The Office of Supplier Integrity and Compliance supports the Government’s ability to identify suppliers of concern and take appropriate action to mitigate the risk they pose.
Key facts
- Since launching on May 31, 2024, and as of January 13, 2026, the Office of Supplier Integrity and Compliance has provisionally suspended six suppliers, suspended four suppliers, and declared 12 suppliers to be ineligible
Key messages
- The Office of Supplier Integrity and Compliance is part of a broader framework of tools that improves the Government’s ability to respond to emerging risks, and protect the integrity of the federal procurement and real property systems
- It administers the Government of Canada’s suspension and debarment program for procurement and real property transactions
- Since its launch, the Office has taken action against various bad actors and continues to step up efforts to identify and respond to suppliers of concern
Background
The Office of Supplier Integrity and Compliance (OSIC), launched in May 2024, replaced the Government of Canada’s Integrity Regime that had been in place since 2015 as a government-wide, policy-based debarment system. It is designed to mitigate the risk of conducting business with suppliers of concern by excluding them from being awarded contracts, as opposed to being punitive which is the role of the criminal justice system.
OSIC plays a significant role in safeguarding the federal procurement and real property systems, which encompasses approximately $20 billion annually for contracts, real property agreements, the management of Crown-owned properties, and rental payments on lease contracts across Canada.
Under the updated Ineligibility and Suspension Policy (the Policy), changes have been introduced to enable OSIC to mitigate risks posed by suppliers of concern. Triggers for suspension or debarment have been expanded to include a wider range of procurement integrity-related issues such as:
- offences under the Criminal Code, the Financial Administration Act and Corruption of Foreign Public Officials Act, the Canada Elections Act
- civil judgments and similar offences that occur in other jurisdictions
- misconduct related to human trafficking, forced labour, environmental violations, and labour code
- wrongdoing in the absence of charges or convictions, including in cases where a supplier has debarred by another jurisdiction or an international organization and/or cases involving a founded breach of the Code of Conduct for Procurement
The updated Policy accords flexibility for OSIC to determine appropriate periods of ineligibility, up to a maximum of 10 years, based on an assessment of aggravating and mitigating factors.
OSIC actively monitors current events for allegations of supplier misconduct through research, information sharing, and data analytics. OSIC exercises due diligence and procedural fairness when assessing suppliers and applies administrative safeguards to allow for independent decision making while taking action when the Policy is triggered.
12. Government Transformation through deployment of Artificial Intelligence
Issue
The Government is pursuing enhanced productivity through the large-scale deployment of artificial intelligence (AI). Greater effectiveness and efficiency in government processes will also lead to improvements in service delivery for Canadians.
Key facts
- As a common service organization, Public Services and Procurement Canada provides a suite of back-office services that support operational efficiency and organizational transformation across the Government of Canada
Key messages
- The government is embarking on an ambitious whole-of-government transformation to build a more agile and productive public service, breaking down organizational silos and implementing horizontal reforms to modernize business processes and technology
- Administrative systems are ideal for transformational, government-wide approaches as they bring together components common to all departments
- For example, Public Services and Procurement Canada is advancing GCtranslate, an enterprise-grade, AI-powered language self-service tool designed to improve translation efficiency while safeguarding Canada’s linguistic identity
Background
Public Services and Procurement Canada and Shared Services Canada leverage their legislative powers to deliver innovative services that make government more efficient and cost-effective. These initiatives support modernization, encourage the responsible use of artificial intelligence and help reduce expenditures, allowing Canadians to invest more in the economy.
Infrastructure
13. Build Canada Homes
Issue
Public Services and Procurement Canada is collaborating with Housing, Infrastructure and Communities Canada and the Canada Lands Company to develop a stable, predictable federal land pipeline for Build Canada Homes.
Key facts
- In September 2025, the Government launched Build Canada Homes, a new federal agency that will build affordable housing at scale. Build Canada Homes’ mission is to build and finance more affordable homes, while catalysing a new housing industry
- In August 2024, Public Services and Procurement Canada launched the Canada Public Land Bank which currently lists 88 properties available for housing development
- These properties have the potential for approximately 42,500 housing units on a total of 463 hectares of land across Canada
Key messages
- Budget 2025 reorients how the Government delivers infrastructure funding to support needs across the country by shifting toward a long-term, investment-driven approach that integrates housing and infrastructure planning
- By leveraging public lands, deploying flexible financial tools, and acting as a catalyst for modern methods of construction, Build Canada Homes is driving a more productive and innovative homebuilding sector
- As one of the largest federal custodians of real property, Public Services and Procurement Canada is leveraging its surplus and underutilized public lands to support government priorities, such as affordable housing
- Public Services and Procurement Canada is taking action to accelerate federal property disposal to enable the creation of new homes where Canadians need them most
Background
Budget 2024 aimed to unlock 250,000 units by leveraging surplus and underutilized public lands across the country by 2031.
Public Services and Procurement Canada has facilitated the disposal of federal lands by launching the Canada Public Land Bank website, the Government of Canada's official online inventory of surplus and underutilized federal properties. There are currently 88 properties listed, representing the potential for approximately 42,500 housing units on a total of 463 hectares of land across Canada.
14. Optimizing the office portfolio
Issue
Public Services and Procurement Canada will continue to provide sufficient, functional office space to accommodate federal public service employees while it optimizes the space under its responsibility and reduces operating costs.
Key facts
- Public Services and Procurement Canada’s office portfolio reduction plan is currently projected to achieve a reduction of 33% in floor area, with associated operations and maintenance savings of $2.45 billion over 10 years and an additional $514 million in annual recurring savings
- Over 50% of Public Services and Procurement Canada’s office portfolio is within the National Capital Region, with the remaining distributed across all other regions of Canada
- Budget 2024 proposed to provide Public Services and Procurement Canada with $1.1 billion over 10 years to reduce the office portfolio by 50% to convert underused federal offices into homes or community facilities
Key messages
- Reducing the size of our office portfolio by 50% will allow Public Services and Procurement Canada to reduce operating costs, lower greenhouse gas emissions and dispose of surplus properties for housing and other community needs
- The Government of Canada’s shift to a hybrid work environment, combined with the government-wide plan to apply unassigned seating as the default, permits a more effective use of space
- Public Services and Procurement Canada continues to work with other departments and agencies to provide sufficient, functional office space ensuring the delivery of their respective mandates and services continues with no impact to Canadians
Background
Public Services and Procurement Canada (PSPC) continuously reviews its use of public funds to provide efficient work environments for federal public servants. The funding announced in Budget 2024 will enable PSPC to plan and undertake strategic workplace enhancements, support the transition to unassigned workstations, and facilitate decommissioning of certain workplaces and client moves into existing or new office space.
PSPC is responsible for making decisions about quality, quantity, and location of space, while also providing accommodation solutions that respond to federal public service employee requirements and ensure best value for money. We have already identified ways to optimize our leased and owned space, including by using shareable spaces and co-locating federal departments and agencies, and accelerating the disposal of surplus assets.
PSPC is currently working with federal departments and agencies to establish their long-term accommodation requirements. The ongoing reduction of the real property portfolio, which began during the pandemic, will continue over a period of 10 years.
The growth in the number of federal employees and the updated Directive on Prescribed Presence in the Workplace (3 to 4 days per week in-office presence) has brought projected space savings down to approximately 33% over the ten-year period, with associated operations and maintenance savings of approximately $2.45 billion over this period.
PSPC works with Shared Services Canada to ensure that office spaces are equipped with the necessary tools for employees, including internet connectivity.
15. Status of the Long Term Vision and Plan for the Parliamentary Precinct
Issue
Public Services and Procurement Canada is implementing a multi-decade strategy to restore and modernize Canada’s Parliamentary Precinct.
Key facts
- $5.9 billion has been invested in the Parliamentary Precinct, which has created approximately 89,000 jobs (person-years of employment) since 2001
- All modernization efforts in the Precinct are guided by a multi-decade strategy known as the Long Term Vision and Plan
- The Centre Block, Parliament Welcome Centre, Block 2 redevelopment and Campus Tunnels are key projects in progress
Key messages
- The modernization of the Parliamentary Precinct is a nation-building effort to safeguard Canada’s democratic institutions
- These investments will transform the precinct into a modern, secure and integrated Parliamentary campus, capable of supporting a 21st century parliamentary democracy for decades to come
- This work is driving economic growth across the country, creating thousands of skilled jobs and showcasing Canadian products and innovation
Background
An extensive update of the Long Term Vision and Plan (LTVP) was completed and endorsed by Parliament in 2025. The updated plan sets out a renewed vision, guiding principles, and frameworks to support the creation of a modern, integrated and secure campus that is welcoming to all.
Buy Canadian Policy: Centre Block
The Centre Block Rehabilitation Program is being built by Canadians for Canadians. Approximately 95% of the companies that have worked on the project are Canadian-owned, with involvement from over 400 companies across seven provinces. 65% of the steel to date is Canadian and this number is expected to increase as the program progresses. Many other aspects of the project are also being sourced from Canada, including stone and wood products, drywall, and copper for the Centre Block Roof.
Major Long Term Vision and Plan Projects
Centre Block and Parliament Welcome Centre
Design is now complete and over 800 workers are on site daily to advance construction activities including the structural rebuild, roof removal, exterior masonry, and the rehabilitation of heritage assets. The targeted completion date remains the 2030–2031 timeframe.
Block 2 redevelopment
The redevelopment of Block 2 (the city block directly facing Parliament Hill) will transform outdated and deteriorated heritage buildings into modern, accessible, and sustainable facilities for Parliament. It will also enable key buildings, such as Confederation, to be emptied and rehabilitated. The estimated completion date is targeted for the early 2030s to align with the completion of Centre Block. 90% schematic design was completed in December 2025. Current construction activities are focussed on investigations, demolition, abatement, and heritage façade protection.
Tunnels
The parliamentary campus tunnel project is a secure tunnel system that will significantly improve security in the Parliamentary Precinct by establishing a secure underground connection between key parliamentary buildings located north and south of Wellington Street. Procurement is underway for architecture and engineering services to support the design process.
Wellington Street
Negotiations with the City of Ottawa to acquire Wellington Street have not resulted in agreement on fair compensation. Acquiring Wellington Street is a key enabler for enhancing the security of the Parliamentary Precinct Campus, which will see over 50% of parliamentarians with offices on the south side of Wellington Street by 2032. This acquisition would also provide the opportunity to significantly enhance the visitor experience.