IYR Explains - Budget 2025

CENTRE FOR INDIGENOUS POLICY AND RESEARCH November 2025

iyr explains : The 2025 Federal Budget

Budget Budget 2025: 2025: At At A A Glance Glance On November 4, 2025, the Liberal government under Prime Minister Mark Carney released its first federal budget.

The timing of the federal budget release has also changed from the usual spring release. For the foreseeable future, the annual federal budget will now be released in the fall, and the economic statement (an update on spending and priorities) will be released in the spring each year.

The government says that the change in timing is to modernize its approach to budgeting, through a new Capital Budgeting Framework. They say this will also improve oversight and transparency in federal spending.

This means the federal government will now be separating operating expenses (like salaries) from long-term investments (like housing or energy projects). This is a change reflected within Budget 2025 itself.

This will also align the timing of the budget with the Main Estimates, or departmental spending plans, which are released in the fall each year.

In Budget 2025, Indigenous programs through Indigenous Services Canada (ISC) and Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC) face a 2% cut in funding, which amounts to $2.3 billion. This follows up on Carney’s commitment to governmentwide reductions in spending, with most other departments facing a 15% cut.

Much of the new commitments allocated specifically to Indigenous communities in Budget 2025 are around infrastructure and economy.

In this IYR Explains, we’re highlighting some of the key commitments made in Budget 2025 that are most impactful to Indigenous youth and their communities. What’s outlined here is not the entirety of Budget 2025 – to see all the commitments made, check out the full budget document here!

When we talk about infrastructure, we mean things like roads, pipelines, homes, clean water, internet, and energy systems. These projects require large financial investments and are constructed on Indigenous lands, impacting land rights.

Large infrastructure projects also bring concerns about meaningful consultation and about how profits from these projects will be equitably distributed to Indigenous communities.

Indigenous Indigenous Communities Communities && Reconciliation Reconciliation Note: This is not an exhaustive list - check out the full budget for more details!

Housing, Infrastructure, and Clean Water Starting in 2026-27: $2.3 billion over three years to renew the First Nations Water and Wastewater Enhanced program to work toward ending drinking water advisories, alongside a commitment to end all long-term drinking water advisories (p. 158) $2.8 billion for urban, rural, and northern Indigenous housing, with commitments to working with First Nation, Inuit, and Métis leadership through Build Canada Homes (p. 159) $1-3 billion increase for the Canada Infrastructure Bank’s target for investments in Indigenous infrastructure for First Nation, Inuit and Métis communities (p. 159) Starting in 2025-26: $1 billion over four years to Transport Canda to create the Arctic Infrastructure Fund, supporting northern transportation projects that advance economic reconciliation, serve local communities, and improve trade and defense access (p. 137).

Starting in 2026-27: An unidentified portion of $6 billion over 10 years from the Direct Delivery Stream for Inuit Nunangat University; the Direct Delivery Stream aims to provide support for regionally specific projects in things like community infrastructure through Infrastructure

Summary of Funding Set Aside for Indigenous Communities: $2.3 billion for First Nations Water and Wastewater Enhanced Program $2.8 billion for urban, rural, and northern Indigenous housing $1-3 billion for Indigenous infrastructure that benefits communities $1 billion for the Arctic Infrastructure Fund $10.1 million for the Federal Initiative on Consultation in relation to the Major Projects Office $213.8 million for the Major Projects Office, which will also support the Indigenous Advisory Council $25.5 million plus $41.7 million for enhancing regulatory processes in the North, including consultation with Indigenous communities

and Communities Canada (p. 102)

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Indigenous Economy Starting in 2025-2026: $10.1 million over three years, for CIRNAC to continue the Federal Initiative on Consultation in relation to the Major Projects Office (p.

81) Starting in 2025-2026: $213.8 million over five years for the Major Projects Office, and this funding will also support the Indigenous Advisory Council (p. 81). $25.5 million over four years (starting in 2025-2026) to CIRNAC and $41.7 million over four years (starting in 2025-2026) to the Canadian Northern Economic Development Agency for enhancing regulatory

The Major Projects Office and the Indigenous Advisory Council are measures funded in Bill C-5, the One Canadian Economy Act. Bill C-5 aims to strengthen trade within Canada, and to fast-track major infrastructure projects such as railway and pipelines.

processes in the North, including consultation with Indigenous governments and organizations (p. 138).

Previous Commitments to Indigenous Communities & Reconciliation Budget 2025 also lists some commitments made to Indigenous communities by the previous government. These commitments have already been implemented in the 2025-26 fiscal year and reflect the spending on those commitments since the December 2024 Fall Economic Statement.

These initiatives do not have new funding allocated to them; rather, they are a restatement of already committed funding. Most of these measures have no funding committed to them beyond the 20252026 fiscal year, which ends on March 31, 2026. The items listed below also don’t contain additional details within the budget document.

Previous commitments to Indigenous communities outlined in Budget 2025 (p. 274): $155 million for funding for First Nations Elementary and Secondary Education* $219 million for the continued implementation of An Act Respecting First Nations, Metis, and Inuit Children, Youth and Families $122 million in continued support for the Inuit Child First Initiative* $1.03 billion in continued support for Jordan’s Principle* $111 million for support for Emergency Management Response and Recovery Activities on Reserve* $6 million for support for flood mapping on reserve* $21 million for transferring housing and infrastructure to First Nations Communities* $34 million for renewing urban programming for Indigenous peoples* *Initiatives with no funding currently committed after March 31, 2026

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Previous Commitments to Indigenous Communities & Reconciliation (continued) $60 million for maintaining the Assisted Living Program for First Nations* $1 million for renewing support for the Indigenous Tourism Association of Canada* $6 million for renewing the Indigenous Tourism Fund* $26 million for advancing Indigenous Data Sovereignty* $14 million for redesigning the Additions to Reserve Policy* $8 million for ongoing management of Indigenous Childhood Claims $5 million for renewing the First Nations Negotiation Funding Support* $665 for Non-Insured Health Benefits (NIHB)* $12 million for upholding federal obligations under the Renewed Nunavut Land Claims Agreement Implementation Contract * Initiatives with no funding currently committed after March 31, 2026

In an interview, Indigenous Services Canada Minister Mandy Gull-Masty said that there isn’t an intention to terminate these programs that do not currently have funding allocated beyond this fiscal year. She said that instead, “the government wants to modernize the delivery of the sunsetting programs and align the intended outcomes with community desires, not terminate them.”

General General Spending Spending

Note: This section highlights some general spending outside of funding allocated to Indigenous communities. For more information, read the full budget.

Housing & Affordability $13 billion over five years, starting in 2025-2026, for Build Canada Homes (p. 156). $51.0 billion over 10 years, starting in 2026-27, and $3.0 billion per year ongoing to launch a new Build Communities Strong Fund to be administered by Housing, Infrastructure, and Communities Canada (p.102).

Automatic Federal Benefits will begin in 2026 and reach up to 5.5 million low-income individuals by the 2028 tax year (p. 162). $71 million over five years, starting in 2025-26, to the Canadian Revenue Agency (CRA) to implement new services that will automatically file simple taxes for eligible low-income individuals who don't file their own, making it easier to access benefits they are eligible for (p. 162).

Youth Employment $75 million for three years, starting in in 2026-27, to Employment and Social Development Canda for investment in Union Training and Innovation Program for the next generation of Canadian builders (p. 158). $594.7 million over two years, starting in 2026-27, to Employment and Social Development Canada for the Canada Summer Jobs program (p. 166). $307.9 million over two years, starting in 2026-27, for Youth Employment and Skills Strategy (p. 166-167). $635.2 million over three years, starting in 2026-27, to Employment and Social Development Canada for Student Work Placement Program (p. 167). $40 million over two years, starting in 2026-27, to Employment and Social Development Canada for the creation of a Youth Climate Corps (p. 167). $50 million over five years, starting in 2026-2027, and $8 million ongoing for the development of new digital tools to facilitate job search and applications (p. 133).

Healthcare & Education $5 billion over 3 years, starting in 2026-27, for a Health Infrastructure Fund to strengthen health infrastructure like hospitals, emergency rooms and urgent care centres through the provinces and territories (p. 102) $216.6 million per year, starting in 2029-2030, to Employment and Social Development Canada, Indigenous Services Canada, and CIRNAC to support the National School Food Program on a permanent basis (p. 163)

Gender Equality and 2SLGBTQIIA+ Rights $54.6 million over the next five years to the Department for Women and Gender Equality (WAGE) to support the 2SLGBTQI+ community sector, and $10.9 million will be set aside for the years following (p. 169). $7.5 million over the next five years and $1.5 million ongoing is being allocated through the Department for Women and Gender Equality (WAGE) for security at Pride events (p. 169). $223.4 million over five years and $44.7 million ongoing to the Department for Women and Gender Equality (WAGE) to tackle gender-based violence (p. 169). $382.5 million over five years and $76.5 million ongoing for the advancement of women’s equality in Canada through the Department of Women and Gender Equality (WAGE) (p. 169).

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Arts & Culture $48 million over three years, starting in 2026-26 to Canadian Heritage for the Canada Music Fund to support Canadian artists (p. 171). $26.1 million over three years, starting in 2026-27 to the National Film Board to produce and share Canadian content (p. 171). $38.4 million over three years, starting in 2026-27 to Canadian Heritage for the Special Measures for Journalism component of the Canada Periodical Fund for small community news outlets to continue producing content (p. 171). $6 million over three years, starting in 2026-27 for the Canada Council for the Arts to support artists and art organizations (p. 171). $116.3 million over two years, starting in 2025-26, to renew the Canada Strong Pass for the holiday season (December 12 – January 15) and through Summer 2026, which reduces costs for Via rail travel for youth, and free entry to National Parks and Museums (p. 173).

Community Community Responses Responses Assembly of First Nations (AFN)

The AFN called Budget 2025 “a missed opportunity” to support First Nations and Canada’s shared prosperity. While the budget includes some Indigenous-related announcements, AFN National Chief Cindy Woodhouse Nepinak said it lacks clear commitments to First Nations in closing the infrastructure gap. This gap, she explains, could add over $635 billion to the economy and add 330, 000 jobs. Chief Woodhouse Nepinak also noted the major absence of new funding for First Nations youth, education, and essential services, urging that any federal spending cuts not come at the expense of vital community programs.

“The 2025 federal budget is a missed opportunity for First Nations and Canada.

Our people and governments are key to Canada moving forward on its ambitious economic agenda but this budget lacks a strategic vision to build our economies.

We’ll continue to push the government to work with us a on a plan to uphold First Nations rights, honour the Prime Minister’s commitments to First Nations, and support long-term prosperity for all.”

- AFN National Chief Cindy Woodhouse Nepinak (via Facebook)

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Métis National Council (MNC) On November 5, the MNC issued a statement expressing disappointment with the fact that Budget

“To advance true economic reconciliation and shared

2025 lacked Métis-specific funding such as dedicated

prosperity, Canada must ensure

funding for Métis governments and distinctions-based

initiatives announced in Budget

allocations in areas such as housing, wellness, or climate leadership. The MNC acknowledged some opportunities for collaboration (e.g., with trade, housing, innovation) but urged Canada to uphold its obligations under the Canada-Métis Nation Accord.

2025 include distinctions-based allocations that empower Métis Governments to lead solutions and drive growth for their citizens”

They stress that future initiatives must include clear distinctions-based funding for Métis selfdetermination and economic prosperity.

- MNC President Victoria Pruden (via MNC)

National Association of Friendship Centres (NAFC) NAFC released a statement, expressing concern about Budget 2025. They say that the federal budget missed an opportunity to address the needs of urban Indigenous peoples by not mentioning Friendship Centres within it. They point out that Friendship Centres are the largest Indigenous service delivery network in the country, and that support for millions of Indigenous people and jobs for those who work at Friendship Centres are at risk of disappearing. They note that the current funding for Friendship Centres sunsets in March 2026 with the end of the fiscal year.

“Urban Indigenous people have been left out of this budget and, we fear, are being left behind by this government.”

- NAFC Board President Pam Glode-Desrochers (via NAFC)

Inuit Tapiriit Kanatami (ITK) In a statement, ITK said they welcome the support for Inuit Nunangat University, and the funding for the Arctic Infrastructure Fund. ITK is concerned that the government has not allocated additional funding beyond March 31, 2026, for the Inuit Child First Initiative, and

“Inuit-Crown partnership is not symbolic — it is a practical requirement for effective governance in the Arctic. We look forward to working with the

that no renewed funding is allocated for eliminating tuberculosis in Inuit communities, after the government

government to turn today’s

committed to eliminating the disease by 2030. In fact,

announcements into

they warned that ongoing inequities in Inuit access to health care and supports could have legal ramifications, given Canada’s obligations to ensure equitable care. ITK notes that the federal budgets since 2015 have been

measurable outcomes for Inuit families and communities.”

- ITK President Natan Obed (via ITK)

progressive in respecting Inuit rights, and that this budget is a “notable departure from this shared path.”

Native Women’s Association of Canada (NWAC) In a statement, NWAC voiced disappointment in Budget 2025. President Josie Nepinak noted that the budget does not mention MMWIG2S+ and echoed concerns from other Indigenous organizations about a lack of regard for the needs of Indigenous communities in the budget. They called for the government to address the MMWIG2S+ crisis with urgency, and shared concerns about the lack of current funding for critical initiatives beyond the 2025-26 fiscal year.

“Most important, this ‘generational budget’ fails to meet the needs of current and future generations of Indigenous people. Instead, it leaves the future of critical Indigenous programs, such as Jordan’s Principle and the Inuit Child First Benefit, uncertain. The clock is ticking. These essential supports are set to sunset in the coming months, and this budget offers no assurance of their continuation.”

- NWAC President Josie Nepinak (via Facebook)

IYR’s IYR’s Impressions Impressions Indigenous Youth Roots welcomes the reaffirmation of the federal government’s commitment to Section 35 rights, the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), and Free, Prior and Informed Consent (FPIC) outlined within Budget 2025 (p. 83). Unfortunately, outside of the money allocated to creating an Indigenous Advisory Council (which will be focused on infrastructure projects), there are no other funds in Budget 2025 that support that commitment to meaningfully and comprehensively implementing UNDRIP. IYR also welcomes the Government of Canada’s ongoing commitment to ending long-term drinking water advisories in Indigenous communities, and the commitment of funding to support women and 2SLGBTQIIA+ folks, and to combatting gender-based violence.

While some new investments are allocated specifically for Indigenous communities in Budget 2025, there is minimal new financial commitments for Indigenous communities outside of measures related to economic development through Indigenous community participation in large-scale infrastructure projects.

IYR also echoes the concern of other advocates regarding the sunsetting of Urban Programming for Indigenous Peoples (UPIP) funding, which funds Friendship Centres across the country in delivering crucial services. Indigenous youth rely on places like Friendship Centres to access everything from mental health counselling, to healthcare, to cultural programs.

Further to this, Budget 2025 does not contain new commitments with measurable impacts directly for Indigenous youth.

IYR advocates for Indigenous youth priorities and voices to shape policymaking and supports Indigenous communities and organizations that serve and represent them voicing their needs.

IYR will continue monitoring and sharing relevant information on the implementation of the measures outlined within Budget 2025, and how they impact Indigenous youth and their communities.

Stay tuned to IYR’s social media for follow-ups related to Budget 2025 as we keep an eye on how these commitments will play out!

Sources Sources & & Further Further Reading Reading Budget 2025 – Full Document (November 4, 2025) APTN, Federal Budget: $2.3B for clean water, and $1B for Arctic infrastructure (November 4, 2025) CBC, Indigenous programs face $2.3B in cuts, some new money in Carney’s 1st budget (November 4, 2025) Government of Canada, Government Expenditure Plan and Main Estimates (May 27, 2025) Office of the Parliamentary Budget Officer, The Government’s New Approach to Budgeting (October 7, 2025) APTN News, Indigenous Leaders Say Budget Misses Historic Opportunity To Address Socioeconomic Gaps (November 5, 2025) Native Women’s Association of Canada, Statement Federal Budget 2025 Canada Strong (November 6, 2025) CBC News, Indigenous Leaders Decry Budget’s Lack of Money for Key Reconciliation Programs (November 5, 2025) Inuit Tapiriit Kanatami, ITK Receives New Government’s First Budget with Cautious Optimism (November 4, 2025) National Association of Friendship Centres, Budget 2025 Risks Reconciliation: Friendship Centres Concerned About Impacts to Urban Indigenous (November 4, 2025) Métis National Council, Métis National Council Statement on Budget 2025 (November 5, 2025) Assembly of First Nations, AFN National Chief Cindy Woodhouse Nepinak Statement on Budget 2025, (November 5, 2025) Government of Canada, 2024 Fall Economic Statement (December 16, 2024) Parliament of Canada, Bill C-5 An Act to enact the Free Trade and Labour Mobility in Canada Act and the Building Canada Act (June 26, 2025) Government of Canada, Government Expenditure Plan and Main Estimates (Parts I and II) (July 27, 2025) Office of the Parliamentary Budget Officer, The Government’s New Budgeting Approach – PBO’s Initial Assessment (October 7, 2025)

For more information, to let us know your thoughts, or to suggest a topic for the IYR Explains series, please contact: Tija Hauta Research Manager, Centre for Indigenous Policy and Research tija@indigenousyouthroots.ca