Summary

On November 4th, 2025, the federal government tabled the 2025 budget. With the election of a new Prime Minister and a direct promise to meet with the nonprofit sector, Budget 2025 offered a rare window for change. 

The nonprofit sector generates $226 billion in economic activity, representing 8.2% of Canada’s GDP, and employs more than 2.7 million people, more than construction, manufacturing or retail trade. Without investment in infrastructure for the sector, Canada risks weakening the very foundation upon which its social programs rely. 

On Nov. 5th, Imagine Canada released a statement reacting to the federal budget. Over the next five years, the government will be investing $280 billion in the following categories: defence and security, housing and infrastructure, and productivity and competitiveness. 

To help the sector better understand the commitments in the budget, we have outlined those of key relevance.

Arts and culture

• $21 million over three years to Canadian Heritage for the Building Communities through Arts and Heritage Program
• $46.5 million over three years to the Canada Arts Presentation Fund 
• $20 million over four years to support Canada Day celebrations
• $4 million over four years to support National Acadian Day
• $9 million over three years to support the Biosphère in Montréal 
• $48 million over three years to Canadian Heritage for the Canada Music Fund 
• $127.5 million over three years to support Canada’s audio-visual content creators 
• $26.1 million over three years to the National Film Board 
• $38.4 million over three years for the Special Measures for Journalism component of the Canada Periodical Fund 
• $6 million over three years to support professional artists and arts organisations.

Housing, Infrastructure and Community

• $51.0 billion over 10 years, starting in 2026-27, and $3.0 billion per year ongoing in new and existing funding for the Build Communities Strong Fund. This initiative will support a wide range of infrastructure projects and help our local communities build Canada strong.
• $2.8 billion is being allocated to urban, rural and northern Indigenous housing, which the federal government will deliver through partnerships with Indigenous partners.

Small and Medium Business Procurement Program

• $79.9 million over five years, starting in 2026-27 to support the new Small and Medium Business Procurement Program. 

National School Food Program

• Introduce legislation and provide $216.6 million per year, starting in 2029-30 to make the National School Food Program permanent

Youth 

• $594.7 million over two years, starting in 2026-27 for Canada Summer Jobs to support around 100,000 summer jobs in summer 2026. 
• $307.9 million over two years, starting in 2026-27 for the horizontal Youth Employment and Skills Strategy. 
• $635.2 million over three years, starting in 2026-27 for the Student Work Placement Program
• $40 million over two years, starting in 2026-27 to create a Youth Climate Corps 

Women and Gender Equality Canada

• $382.5 million over five years  ($76.5M ongoing) to revitalize and stabilize efforts to advance women’s equality in Canada 
• $54.6 million over five years ($10.9M ongoing) to support the 2SLGBTQI+ community sector. Including $7.5 million over five years for Pride Security
• $223.4 million over five years ($44.7M ongoing) to strengthen federal action on gender-based violence

Canada Disability Benefit

• $115.7 million over four years ($10.1M ongoing) including administrative costs, for a one-time supplemental Canada Disability Benefit payment of $150 in respect of each Disability Tax Credit certification, or re-certification, giving rise to a Canada Disability Benefit entitlement.
• Introduce legislation to exempt the Canada Disability Benefit from being treated as income under the Income Tax Act. 

Automatic Federal Benefits for Low-Income Individuals

• Amend the Income Tax Act to allow the CRA to file a tax return on behalf of certain eligible individuals with lower incomes in simple tax situations who do not owe tax and do not file themselves

Financial Crimes Agency

• Introduce legislation to establish a new Financial Crimes Agency to be Canada’s lead enforcement agency against financial crimes. 

Research and development 

• Boosting productivity and innovation through the Productivity Super-Deduction, enhanced Scientific Research and Experimental Development (SR&ED) Tax Incentives, and $925.6 million for sovereign public AI infrastructure. Dedicated funding for life sciences and emerging technology via the Strategic Innovation Fund and the Venture and Growth Capital Catalyst Initiative can help turn Canadian innovation into commercial success.
• $97-million Foreign Credential Recognition Action Fund to tackle workforce shortages in the health and construction sectors.

Artificial Intelligence 

• $925.6 million over five years for large-scale AI infrastructure to support public and private research
• $25 million over six years ($4.5M ongoing) for Statistics Canada’s AI and Technology Measurement Program

Comprehensive Expenditure Review

The Comprehensive Expenditure Review (CER) has raised concerns across the nonprofit sector, as cuts could affect programs, funding, and services that organizations and communities depend on. Anticipated impacts include slower service delivery, deeper cuts to social programs, and reduced grants and contributions. The Budget reiterates that the main goal of the CER is to rein in government spending with a projected savings of $13 billion annually by 2028–29, contributing to $60 billion in total savings and revenues over five years. The government also plans to reduce the public service workforce from 368,000 to 330,000 by 2028–29, a decline of about 40,000 positions (10%). Notable departmental savings targets include a 2% reduction for Women and Gender Equality Canada (WAGE), Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC) and Indigenous Services Canada (ISC). Within the sector, there is concern that some programs are sunsetting. Imagine Canada will continue to work with the government to understand the impact to the sector. 

What’s Next

Canada currently has a minority government, which means it does not hold a majority of seats in the House of Commons. To remain in power it needs another party to vote in favor of the budget or to have three members of parliament cross the floor to join the Liberals to pass the budget. On November 18, the government's Budget bill (Bill C-15) passed first reading with 170-168 votes due to a single vote from the Green Party and four abstentions (two from the New Democratic Party and Conservatives). Second reading of Bill C-15 is currently in progress. We will continue to monitor the progress of the bill as the House of Commons prepares to adjourn for the winter.