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Appropriation Act No. 2, 2026-27

Full Title:
An Act for granting to His Majesty certain sums of money for the federal public administration for the fiscal year ending March 31, 2027

Summary#

Bill C-32 is the federal government’s second main spending law for the 2026–27 fiscal year. It authorizes up to $144.03 billion to be paid from the Consolidated Revenue Fund (the federal government’s main account) for departments and agencies, as set out in the Main Estimates. The goal is to fund federal programs and operations through March 31, 2027.

Key points:

  • Authorizes up to $144,032,017,964 in voted spending not already approved in the first interim appropriation.
  • Sets detailed dollar limits (“votes”) for each organization in Schedule 1; amounts take effect April 1, 2026.
  • Provides central Treasury Board funds, including contingencies ($1.0B), carry‑forwards, public service insurance ($5.04B), and other government‑wide items ($11.79B total).
  • Gives the Canada Revenue Agency $4.85B (Schedule 2) that can be used and charged to 2026–27 or 2027–28, and spent up to March 31, 2028.
  • Authorizes specified payments, loans, and guarantees to international financial institutions and in support of Ukraine within set limits.
  • Unused amounts generally lapse at year‑end (with limited exceptions noted for Schedule 2 items and accounting adjustments).

What it means for you#

  • General public and taxpayers

    • Day‑to‑day federal services (such as border services, passports/immigration processing, public health work, benefits delivery, and policing) have funding authority to continue in 2026–27.
    • The bill does not change tax rates or create new benefits on its own. It funds programs already set out in the Main Estimates.

  • Indigenous communities

    • Large funding authorities for Indigenous Services Canada (about $23.9B) and Crown‑Indigenous Relations and Northern Affairs (about $11.9B) allow continued delivery of services, programs, and agreements. The bill does not list project‑level details.

  • Patients and health partners

    • Health Canada and the Public Health Agency of Canada receive operating and contribution funds to keep regulatory, public health, and funding programs running. Specific program amounts are not detailed in this act.

  • Workers, seniors, students, and families using federal programs

    • Employment and Social Development Canada (about $13.6B in voted funds) is authorized to keep delivering grants and contributions tied to employment and social programs. The act does not specify changes to eligibility or benefit levels.

  • Veterans

    • Veterans Affairs (about $8.1B) is funded for ongoing services, benefits, and supports.

  • Homebuilders, housing providers, and communities

    • Housing, Infrastructure and Communities (about $8.0B) and CMHC reimbursements (about $6.13B) are authorized, supporting housing and infrastructure initiatives contained in the Main Estimates.

  • Businesses, researchers, artists, and non‑profits

    • Funding continues for research councils, the National Research Council, arts and culture bodies (e.g., CBC/Radio‑Canada, Canada Council for the Arts), tourism, and regional development agencies. The bill does not identify individual grants.

  • Travellers and transport users

    • Transport Canada, CATSA (airport security), VIA Rail, and major bridge/transport authorities receive funding to maintain operations and projects.

  • Defence and security

    • National Defence (about $48.37B) and public safety agencies (e.g., RCMP, CSIS, CSE) are funded to continue operations, capital projects, and grants/contributions specified in the Estimates.

  • If you work with or for the federal government

    • Departments have authority to spend on operations, salaries, and capital as listed. Treasury Board central votes cover pay requirements, insurance, and carry‑forwards.

Note: The act sets spending ceilings and purposes but does not provide program‑by‑program details or change eligibility rules.

Expenses#

Estimated public cost: up to $144.03 billion in voted spending for 2026–27 under this act, plus $4.85 billion for the Canada Revenue Agency that can be used through March 31, 2028.

  • Largest department/agency totals in Schedule 1 include:
    • National Defence: about $48.37B
    • Indigenous Services: about $23.93B
    • Employment and Social Development: about $13.62B
    • Crown‑Indigenous Relations and Northern Affairs: about $11.86B
    • Health (Health Canada + Public Health Agency of Canada): about $10.43B + $1.46B respectively
    • Housing, Infrastructure and Communities: about $7.96B
    • Canada Mortgage and Housing Corporation reimbursements: about $6.13B
    • Public Works and Government Services: about $5.70B
    • RCMP: about $5.51B
  • Treasury Board Secretariat government‑wide votes total about $11.79B, including:
    • Government contingencies ($1.0B), operating and capital carry‑forwards ($3.0B and $0.75B), public service insurance ($5.04B), paylist requirements ($0.6B), and defence/security initiatives ($1.0B).
  • Canada Revenue Agency (Schedule 2): about $4.85B (operating and capital), available to be charged to 2026–27 or 2027–28 and spendable until March 31, 2028.
  • International financial items (within set limits):
    • Direct payments to the International Development Association (up to $304.04M CAD in 2026–27).
    • Loans to the International Development Association (up to $916.07M USD in 2026–27).
    • Guarantees for EBRD loans to Naftogaz (up to €200M over 2026–27 to 2030–31).
    • Guarantees for IBRD loans to the Government of Ukraine (up to $1.0B USD over 2026–27 to 2051–52).
  • National Defence may enter total commitments of up to about $129.09B for Votes 1, 5, and 10, with an estimated $76.14B due in future years (beyond 2026–27).
  • Many organizations are allowed to spend certain revenues they collect to offset related costs. This authority does not itself set new fees.

Proponents' View#

  • The bill appears intended to give the legal authority needed to keep federal programs, services, and operations running through 2026–27.
  • It aligns funding with the Main Estimates, which lay out planned spending by department and purpose.
  • Central Treasury Board votes could be seen as providing flexibility to handle urgent or unforeseen needs, payroll pressures, and project carry‑forwards without service disruptions.
  • Significant funding authorities focus on areas of public interest, such as defence and security, Indigenous services, health, housing/infrastructure, veterans’ services, and research and culture.
  • Multi‑year use of CRA funds and defined timelines for charging expenditures could help manage large projects and system changes more efficiently.
  • Specified payments, loans, and guarantees to international institutions and in support of Ukraine may be viewed as supporting global development, stability, and allied commitments within capped limits.

Opponents' View#

  • One concern is that the bill is very large and high‑level; it authorizes big sums without program‑level detail in the act itself, making it harder for the public to see specific outcomes.
  • Central Treasury Board votes for contingencies, carry‑forwards, and defence/security allow funds to supplement other appropriations, which may reduce prior, line‑by‑line scrutiny of some reallocations.
  • Schedule 2 funds (CRA) can be spent across two fiscal years and up to March 31, 2028; while practical, this may dilute single‑year spending discipline.
  • The act allows post‑year‑end accounting adjustments (non‑cash) and sets order‑of‑payment rules for Schedule 2, which may complicate transparency for non‑experts.
  • Loan and guarantee authorities (e.g., for Ukraine‑related items) create potential future liabilities; the immediate fiscal impact may be limited, but the risk is not zero.
  • It is unclear from the act which communities, projects, or clients will receive how much funding; details depend on the Main Estimates and departmental plans, not this statute.