Canada’s 2026 federal budget has been released, with a focus on healthcare spending.
The Canada Health Transfer (CHT) is getting $57.4 billion in 2026-27, up $2.7 billion from the previous year. That’s a 5% increase, as expected. However, this guaranteed growth is slated to drop to a minimum of 3% after 2027-28 — a number that premiers were hoping Ottawa would reconsider in this year’s budget. That didn’t happen.
Mental Health, Addictions, and Home Care Funding
The budget includes a $1.2 billion one-year extension for mental health, addiction services, and home and community care funding, running until March 31, 2028. The $100-million Emergency Treatment Fund will also be renewed for two years, starting in 2027-28.
While these investments are welcome, health ministers had hoped for longer-term funding commitments. The budget proposes $11.2 billion over the next four years towards helping people move from homelessness to stable housing, build community mental health and addictions facilities, and support homelessness prevention programs. This includes $2 billion for a new Health Infrastructure Fund to build community mental health and addiction facilities, $1.8 billion for an Integrated Supports Fund connecting housing, healthcare, and social services, and $3.6 billion for supportive and transitional housing, aiming to put Canada on a path to end homelessness in 10 years.
Indigenous Health and Infrastructure
A significant portion of the budget is dedicated to Indigenous health and infrastructure. This includes $32 billion over 10 years for First Nations infrastructure, $4.6 billion for clean drinking water in First Nations communities, and $2.9 billion over three years for Non-Insured Health Benefits. Additionally, $290 million over four years will support public health workers and initiatives, and $6 billion over six years will be allocated for Jordan’s Principle, ensuring First Nations children can access the health and social services they need.
The Manitoba Métis Federation has expressed disappointment over the lack of Métis funding, with only $806 million allocated over five years for child welfare law implementation. The budget also supports public health workers, Jordan’s Principle, and Inuit children’s programs, including $575 million over five years for a program supporting Inuit children.
Women’s Health, Research, and Debt Concerns
The National Women’s Health Research Initiative receives $14.9 million over four years, addressing gaps in women’s health research. The budget also invests $10 million over two years for the Praxis Spinal Cord Institute to support research into new treatments for spinal cord injuries. The Canada Groceries and Essentials Benefit will see a one-time 50% increase for the 2026-27 benefit year, offering up to $339 for single individuals and $679 for couples with two children. Additionally, Nutrition North Canada will receive $620.3 million over four years, $118.1 million in 2031-32, and an ongoing $117 million to help lower the cost of imported food to remote northern communities.
Despite increased healthcare spending, Canada is projected to spend more on federal debt servicing than on the Canada Health Transfer. In 2026-27, debt servicing will cost $60.2 billion, compared to $57.4 billion for the CHT. By 2030-31, debt charges are expected to reach $85.5 billion.
Finance Minister Francois-Philippe Champagne says Canada’s debt remains “manageable by historical standards.”
