In August the federal Liberal government announced it would be refocusing government spending and would initially cut $15 billion over five years. This past week Treasury Board President Anita Anand provided the details on $500 million in cuts from this current fiscal years planned $443 billion budget. The Canadian Space Agency was not spared, having to freeze $8,023,000 in planned spending. There’s more to the story than simple cuts, and the governments narrative doesn’t quite match reality.
Put into context, the $500 million budget cut across all affected departments represents around 1/10th of 1% of overall budget for the year. And for the Canadian Space Agency (CSA), a freeze of a little over $8 million from its planned spending of $537.4 million this current fiscal year represents an approximate cut of 1.49%.
According to the government, the freeze will affect spending on professional contractors, travel costs, operations and transfer payments.
What will the government do with the money that it’s freezing at the CSA and other departments? According to the CBC the money “will lapse back to general government revenue at the end of the fiscal year in March.”
The Supplementary Estimates (B)
The announcement of the cuts came as the Treasury Board tabled Supplementary Estimates (B). The government stated that “These Supplementary Estimates present the first update on the Refocusing Government Spending Initiative. As committed in Budget 2023, $500 million in travel and professional services funding has been refocused and removed from the 2023–24 budgets of 68 departments.”
The supplementary estimates contained a surprise for the CSA, an increase in funding, huh!
In the 2023-24 Supplementary Estimates (B) the CSA had a net adjustment of $3,029,519. The additional funding is going to the Quantum Encryption and Science Satellite (QEYSSat) ($2,076,000), the Dextre Deployable Vision System ($791,000) and the Microfluidic Sample Preparation project ($515,000). The total Authorities To Date now stands at $597,542,136 up from $594,512,617.
What the planned spending for the CSA next fiscal year (2024-25) will be is still to be determined. Previous estimates had a large cut to happen. But with the increased funding as outlined earlier this year at budget time, primarily moon related, along with newer announcements, it would appear next years budget won’t see a major drop, and in fact could be close to this years level.
Getting back to freeze. While the Supplementary Estimates (B) show a net increase, how can we reconcile that with an $8 million freeze? The answer lies in a statement the CSA provided to SpaceQ on our question as to how the CSA would handle the freezing of this funding.
The CSA told us that “The Government has made significant investments in Canada’s space program, including deep space exploration and earth observation to support a range of services to Canadians. As part of the Government of Canada’s Refocusing Government Spending Initiative, the Canadian Space Agency is working to find savings and efficiencies. This year, Supplementary Estimates (B) present the first update on the Refocusing Government Spending Initiative. Additional information concerning savings for future years will be included in the Main Estimates, to be tabled in Parliament by March 1, 2024.”
There you have it. We have to wait until the main estimates come out. But does it matter?
Refocused vs Lapsed or Reprofiled Funding
It’s no secret that each year some government departments don’t spend their full budget allocation. This can happen for a variety of reasons including delays in programs. The CSA is no different as shown in the chart below. When the CSA doesn’t fully spend its planned budget some of those funds get reprofiled into the following years budget.
So several questions comes to mind including are the savings the government is after really savings? And yes, the CSA will have a little over $8 million in funds frozen. But how much, if any, of this years planned spending will get reprofiled? How different will the main estimates that will be released next March differ now? We don’t have answers to these questions as yet.
What we do know, is that at the moment based on this years budget increases to certain CSA programs and subsequent Earth observation announcements, it’s unlikely that the CSA will see a serious impact to its budget next year.