While Budget 2025 does not include a strategy to systemically support programs and services that non-profits and charities provide – or the Canadians working at these organizations – “it could have been worse,” says economist Armine Yalnizyan, the Atkinson Fellow on the Future of Workers.
Prime Minister Mark Carney’s first national budget promises to spend less to invest more in a strong Canada. Presented by Finance Minister François-Philippe Champagne on November 4, Budget 2025 proposed capital investment increases on trade, transportation, housing, energy, and money transfers to provinces and territories. Despite these investments, Budget 2025 does not include a strategy to systemically support programs and services that non-profits and charities provide – or the Canadians working at these organizations. The Philanthropist Journal spoke to economist Armine Yalnizyan, the Atkinson Fellow on the Future of Workers, about how the budget may affect Canadians and the non-profit sector.
Budget 2025 has four objectives: harnessing Canada’s resources to help businesses thrive, building projects that align with Canada’s national interest, unifying the economy to support Canadian careers, and diversifying Canada’s trade partners amidst ongoing US trade barriers.
Yalnizyan says it is the most business-forward budget she has seen since the 1980s, a time marked by recession, where the federal government attempted to combat rising inflation and interest rates. The government’s investments include clean-energy technologies, defence and security businesses, innovation in artificial intelligence, and more. Budget 2025 emphasizes creating high-paying careers within these industries but does not explicitly include the charitable sector. “If we can get a focus on non-profit human services instead of for-profit human services as a way to meet the market niche, the excess demand, [the] undersupplied need for human care – that should be the focus of all levels of government,” Yalnizyan says. “And to do that, you would have to have better living wages, better pensions, higher levels of staffing, more staff competencies. It’s a whole human resource strategy to not only have enough people, but attract more people, and then retain them once you’ve attracted them.”
The care economy is the economic powerhouse of our economy.
Armine Yalnizyan
Canada’s non-profit sector employs 2.7 million people and accounts for 8.2% of Canada’s gross domestic product. “The care economy is the economic powerhouse of our economy,” Yalnizyan says.
Education and housing support, long-term care, arts and culture programs, and mental health care are some examples of the health and social assistance Canadians get from charities and non-profits. Twenty percent of Canadians accessed charitable services to meet their essential needs in 2023, and the number is growing amidst an overworked and underfunded sector.
Breaking down the numbers
According to Budget 2025, the federal government will fund social programs for more than 23.4 million Canadians, including the Canada Child Benefit, the National School Food Program, the Canada Disability Benefit, the Old Age Security program, student loans and grants, $10-a-day childcare, the Canada Workers Benefit, and the Canadian Dental Care Plan.
The budget does not increase funding to the $1-billion, five-year National School Food Program, but it does propose introducing legislation to provide $216.6 million per year for a permanent food program, starting in 2029/2030. The current interaction provides meals to 400,000 children, but in 2024, 2.5 million children lived in food-insecure households.
The fact that they didn’t add funding to [the National School Food Program] is very disappointing. The fact that they didn’t add funding to childcare is very disappointing.
Armine Yalnizyan
“The fact that they didn’t add funding to [the National School Food Program] is very disappointing,” Yalnizyan says. “The fact that they didn’t add funding to childcare is very disappointing, because the issue is not just $10 a day; it is how many parents in licensed care get anything approaching $10 a day.” She uses Ontario as an example, where childcare programs enrolled in the Canada-Wide Early Learning and Child Care (CWELCC) system can cost Ontario families up to $22 per day, and non-CWELCC programs can reach $50 to $70 per day. “There’s no plan on getting us to $10 a day by the end of next year, which was the original plan,” she says. “It’s not just what the feds will do, but how they will react to what the provinces do or don’t do in the things that are firmly in their jurisdiction – and they have not seen a penny cut in terms of transfers.”
Transfers for provinces, territories, and municipalities are federal funds that each government receives to support public services. In 2025/2026, provincial, territorial, and municipal governments are expected to receive a $110.8 billion transfer in total, which will increase to $126.3 billion in 2029/2030. “It’ll impact both the non-profit sector as well as the public sector,” Yalnizyan says. “The amount of money is not the issue. It’s ‘How is that money used?’ and ‘Will the federal government make any kind of penalties for [provinces] breaking their own word?’”
In Alberta (a signatory of the $3.8-billion Canada-wide deal to make childcare more affordable), a childcare owner complained about the provincial government’s grants arriving late to the point that she incurred debt after lowering her childcare fees, while others were told there were not enough grants to subsidize their childcare centres shortly before they were set to open.
In 2022, approximately 6,077 out of the 11,820 childcare centres in Canada were operated by non-profits. Nearly 1.2 million children were enrolled in childcare programs, which, at a minimum of $10 a day, means Canadians are spending at least $12 million per day on childcare.
What’s the magic number?
While non-profits acknowledge some benefits of Budget 2025, they are pushing for more than just isolated social programs. So, what amount of money is enough to give the sector what it needs to build sustainably? “There isn’t a magic number,” Yalnizyan says. “Are you better off when you have more money in your pocket or when you don’t need as much money because you get more services? We haven’t answered that question yet.”
Notably absent from Budget 2025 was a proposal for universal basic income (UBI), which advocates have identified as a means to reduce poverty and economic insecurity. Yalnizyan has written about burying the idea of UBI, exploring how it may not guarantee everyone’s needs. She uses the example of a monthly $2,000 income failing to guarantee access to childcare. “You’ve got more money in your pocket, but you don’t have more services. It costs you less to provide services,” she says.
Are you better off when you have more money in your pocket or when you don’t need as much money because you get more services?
Armine Yalnizyan
Yalnizyan also says that finding a suitable amount of money to allocate to the non-profit sector depends on the population’s demographic. “The majority of seniors are not over 85 yet, but we’ll be there in about 10 or 15 years. We have runway, but we’re not doing anything about it,” she says. “So will we need more money? Yes, we will need more money. Is it just in the form of incomes, in terms of elderly benefits? No, we’re going to have to spend so much more on services for people that are too old to care for themselves. They’re going to need home care. They’re going to need more diagnostic care. They’re going to need more acute care.”
More than half of Canada’s non-profits serve the general public, and 35% of them serve seniors specifically. Senior living can cost $3,075 per month for private retirement homes, $4,500 per month for private assisted-living costs, and $7,908 and $9,034 per month for semi-private and private nursing home rooms, respectively. The average income for senior Canadians in 2024 was $2,800 per month after taxes.
Yalnizyan says the funding Canada needs depends on how willing the federal government is to promote the health, education, and well-being of the working-age population, since they will be paying most of the taxes to fund the whole system. “How much social consensus can you get to pay for a world that we want?” she asks.
Building consensus within the non-profit sector
With the release of the budget, national and provincial non-profits and networks are advocating for the sector’s needs. Imagine Canada published a statement about the contributions and shortcomings of Budget 2025. The BC Non-Profit Network published recommendations for the federal government to improve Budget 2026. According to their statements, organizations need multi-year funding with embedded inflation increases in the government agreements, a non-profit labour force strategy, investments in non-profit data to have better policy and funding decisions, and less administrative work so staff have more time to deliver services.
But not all organizations participate in advocacy. According to October research findings on policy engagement from the Charity Insights Canada Project (CICP), 55% of charity respondents engage in advocacy in some capacity. CICP’s survey says 25% regularly connect with government officials to discuss grants or contracts, 23% respond to information requests, and 17% meet with government officials to discuss their charity’s work. Moreover, 57% of respondents have never presented to a parliamentary committee, and 50% have not released research reports to policymakers.
Yalnizyan says lack of capacity and inefficient data strategy prevent charities from doing more. She says that while organizations and networks are trying to talk to the federal government, they are not making a case to their peers and “organizing down” to create better strategies. “It’s really difficult to do this . . . It’s not very strategic how data is being collected, how it’s being used, how it is lifted up to some kind of macro story, and how it is disseminated back out to the people,” she says. “There are enough people in the sector that they could be making more noise, but right now they are not making a lot of noise because they’re overwhelmed by the demand.”
CICP’s findings reveal that 31% of respondents did not engage in advocacy or lobbying in 2024 or 2025, while 7% of respondents’ advocacy resources decreased over the year and 8% could not increase their resources.
If we lose the sector [or] capacity in this sector, we’re cooked.
Armine Yalnizyan
“I don’t think there are enough allies to the movement of non-profit workers in the form of academics or journalists or fellow travellers in the unions that are using their power, leaning into their power, to tell the story of how important the sector is – to be able to say, ‘If we lose the sector [or] capacity in this sector, we’re cooked,’” Yalnizyan says.
Additionally, the sector’s employees continue to be underpaid, with women making 18% less as non-profit employees than the average Canadian, and men making 3% less.
“The non-profit sector is often the para-public sector. It’s not as organized, it’s not as well paid, but it’s doing the things in the community that need doing, often with volunteer labour,” Yalnizyan says. “It’s not sufficiently strategic about how it is going to get up the nose of [the] government, when the nose of the government is very much sniffing out where the next business investment is going to be.”
Despite this, when asked if there is anything that makes Yalnizyan hopeful about Budget 2025, she says, “It could have been worse. We were prepped for a bigger deficit. We were prepped for deeper cuts.”
Budget 2025’s $78-billion deficit is surpassed only by the 1993/1994 deficit of $42 billion – which, after accounting for inflation, equals $81 billion in 2025.
“The other thing that makes me hopeful about the budget is this is not a one-and-done budget,” Yalnizyan says. “We’re constantly going to be recalibrating the federal government’s response to this economic war that has been waged on us by Trump and the various actions that the provinces are taking or failing to take to deal with other issues.”
