Federal Indigenous spending quadrupled to $40.8B under Trudeau, with ‘negligible’ improvement to communities

In the decade leading up to 2024/25, inflation-adjusted federal Indigenous spending jumped from $10.3 billion to $40.8 billion, growing seven times faster than overall federal spending, according to a new study published by the Fraser Institute.

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The independent think tank found that inflation-adjusted federal Indigenous spending increased by an average of 4.3 per cent per year from 1969/70 to 2014/15. But from 2014/15 to 2024/25, average annual Indigenous spending increased 17.1 per cent, not including the “substantial” spending on lawsuits and court settlement payouts.

Broken down by federal spending per province, federal Indigenous spending ranges from a low of $73 million in PEI to a high of $8.8 billion in Ontario.

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In B.C. in 2024/25, the federal government spent approximately $6.3 billion on program benefits for Indigenous people in the province — an average expenditure of $20,306 per Indigenous person, according to the study.

“Ottawa’s Indigenous spending has skyrocketed in recent years, even more so than general federal spending, which itself has increased substantially,” said Tom Flanagan, co-author of the study and senior fellow at the Fraser Institute.

“Canadians need to understand the magnitude of Ottawa’s Indigenous spending in recent years if they’re ever to properly assess what that additional spending is achieving in terms of results for Indigenous people.”

In former prime minster Justin Trudeau’s first major promise as part of his 2015 election campaign, he said that a Liberal government would invest a total of $2.6 billion in First Nations education.

Meanwhile, previous Fraser Institute research from 2024 found that federal Indigenous spending almost tripled under Trudeau, from $11 billion in 2015 to a projected $32 billion.

And in the spring economic update in April, the Carney government announced $601 million for culturally relevant elementary and secondary education on reserve, and $700 million over six years to support Indigenous communities implementing jurisdiction for child and family services.

However, Statistics Canada’s Community Well-Being index (CWB), which gauges the socio-economic health of Canadian communities, suggests the spending increases have led to little improvement for Indigenous communities.

The Fraser Institute’s analysis found that in 1981, the difference in the index between First Nations communities
and other Canadian communities was 19.5 points. In 2016, the gap was 19.1 points, showing essentially no change after 35 years.

In 2021, the most recent year for which the data is available, that gap had shrunk somewhat to 16.3, but the Fraser Institute study argues that “closer analysis shows that improvement was due to an increase in the Canada Child Benefit, which is a general family support measure not included in Indigenous program spending.”

It adds that the positive impact of these spending increases on First Nations’ reserve communities “has been negligible.”

The Fraser Institute study, published on Tuesday, comes as Canada marks the sixth National Day for Truth and Reconciliation, which honours residential school survivors and their families.

It is not the first report to suggest that the government is failing to improve the lives of First Nations people. In October 2025, an Auditor General follow-up on First Nations programs found that Indigenous Services Canada had made “unsatisfactory progress” in implementing recommendations made in six audits completed from 2015 to 2022.

The report said: “Despite an 84 per cent increase in the department’s spending on programs since the 2019-20 fiscal year, significant challenges remained in improving services and program outcomes for First Nations communities.”

Elsewhere, a 2022 analysis carried out by the Office of the Parliamentary Budget Officer found that while financial resources allocated to providing Indigenous services had “increased significantly” for the 2015/2016 to 2022/2023 period, it hadn’t resulted in an improvement in the ability of the organizations to achieve their goals.

In fact, the document said, “the ability to achieve the targets specified has declined.”

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