Government Business Subsidies Hit $87.7 Billion, Up 142% Since 2019, Fraser Institute Says

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Canada’s use of government support for businesses has expanded dramatically from its pre-pandemic level, according to new Fraser Institute research released on August 11, 2026. Using Statistics Canada public-finance data, the institute calculates that combined federal and provincial business subsidies reached $87.7 billion in 2024, measured in inflation-adjusted 2025 dollars. That represents an increase of roughly 142% from 2019, when comparable spending was about $36.2 billion.

The headline figure captures more than emergency pandemic assistance. Provincial support has climbed over the longer term, while federal spending surged again in 2024 after falling sharply from its pandemic peak. The numbers add another dimension to Canada’s growing debate over industrial policy: whether governments should keep directing billions toward selected businesses and sectors, or shift more of that money toward broader tax and investment policies.

The $87.7 Billion Figure Is for 2024, Not 2026

The most important detail behind the headline is the date. The Fraser Institute released its findings in August 2026, but the $87.7-billion figure refers to 2024, the latest year for which comparable federal and provincial data were available. The researchers use Statistics Canada government-finance tables and adjust historical amounts into 2025 dollars, allowing spending from different years to be compared without inflation distorting the picture. Their measure combines conventional subsidies with capital transfers to businesses at the federal and provincial levels.

That definition matters because it is not a tally of every conceivable way governments assist companies. The measure focuses on specific expenditure categories recorded in Statistics Canada’s government accounts rather than, for example, treating every business tax provision, loan or regulatory advantage as a cash subsidy. The Fraser Institute describes these transfers as “corporate subsidies” or “corporate welfare,” reflecting its policy position. Statistics Canada itself provides the underlying accounting categories without making that ideological characterization. Keeping the distinction clear helps separate the raw fiscal numbers from the debate over whether the spending is justified.

Spending Rose From About $36.2 Billion in 2019 to $87.7 Billion 

The 142% increase becomes clearer when the starting point is reconstructed. In 2019, federal subsidies measured by the study totalled about $7.1 billion, while the provinces collectively spent roughly $29.2 billion, producing a combined inflation-adjusted total of about $36.2 billion. By 2024, the corresponding combined figure had reached approximately $87.7 billion. That is an increase of more than $51 billion in five years, even after adjusting for changes in the price level.

The growth did not begin with COVID-19. Fraser’s figures show combined spending rising from roughly $22.3 billion in 2007 to $25.1 billion in 2015, an increase of 12.8%. It then accelerated: spending in 2019 was 44.2% above its 2015 level. The pandemic subsequently produced extraordinary temporary programs, but the researchers emphasize that subsidy spending also rose in each of 2022, 2023 and 2024. That longer trajectory is central to their argument that Canada has experienced a structural expansion in government support for businesses, rather than simply a one-time emergency response.

Ottawa Accounted for Much of the Latest Jump

Federal spending explains a large share of the dramatic 2024 total. Before the pandemic, the Fraser Institute’s inflation-adjusted federal figures generally remained below $10 billion annually. Federal support was approximately $7.1 billion in 2019, but it exploded to about $96.1 billion in 2020 as governments created emergency programs to keep companies and workers afloat during shutdowns. It remained extraordinarily high at roughly $51 billion in 2021 before dropping to $13.2 billion in 2022 and $16 billion in 2023.

Then came another striking increase. The study calculates federal subsidies and capital transfers at about $44.7 billion in 2024, almost matching the $43 billion spent by all 10 provinces combined. That federal amount was more than six times the comparable 2019 figure. The numbers illustrate why a national total can shift dramatically even when individual provincial programs change more gradually. A business owner watching a new provincial grant or tax incentive may see only one small program, but accumulated across governments, industries and major investment initiatives, those expenditures can become a substantial part of public finances.

The Pandemic Distorts the Trend — and 2025 Adds an Important Caveat

The pandemic years make almost any recent comparison difficult. Federal business-support spending reached levels in 2020 and 2021 that were unlike anything in the preceding period, reflecting emergency economic measures rather than normal industrial policy. That is why the Fraser Institute treats those years cautiously when discussing the longer trend. Even after those exceptional years are put aside, however, the study finds that combined subsidy spending rose after 2022 and reached the $87.7-billion level in 2024.

There is also a major piece of newer data worth highlighting. The study’s table includes a 2025 federal figure of about $12.1 billion, because federal information is available one year further than comparable provincial data. That is roughly 73% below the federal 2024 level. It means the $87.7-billion national total should not automatically be interpreted as evidence that spending remained at that level in 2025 or 2026. A complete 2025 national comparison cannot yet be made from the study because equivalent provincial figures are not included. The unusually large federal reversal is therefore an important qualification to any claim that subsidies are simply continuing upward without interruption.

Ontario Leads in Dollars, While the Per-Capita Picture Looks Different

Among provinces, Ontario recorded by far the largest dollar amount in 2024 at approximately $19.9 billion, according to the Fraser calculations. Quebec followed at about $10.7 billion, while British Columbia was near $4.2 billion and Alberta roughly $3.7 billion. Saskatchewan spent about $2.3 billion. Ontario’s total is partly a reflection of its much larger population and economy, but the institute also finds a particularly large long-term increase there: comparing three-year averages for 2007–2009 with 2022–2024, Ontario’s provincial subsidy spending rose by a factor of about 8.35, the largest increase among the provinces.

Per-capita figures tell a different story. In 2024, provincial business subsidies were calculated at approximately $1,860 per Saskatchewan resident and $1,642 per Prince Edward Island resident, compared with about $1,232 in Ontario, $1,191 in Quebec, $746 in Alberta and $739 in British Columbia. These figures are provincial spending only; federal support is recorded separately at roughly $1,083 per Canadian in 2024. The contrast shows why absolute totals and per-person measures can lead to very different impressions of which governments rely most heavily on business support.

The Long-Run Total Reaches Nearly $787.3 Billion

Looking beyond individual years produces an even larger number. From 2007 through 2024, the Fraser Institute calculates that provincial governments provided about $474.4 billion in inflation-adjusted business subsidies and capital transfers. The federal government added approximately $312.9 billion, bringing the combined amount to roughly $787.3 billion over the 18-year period. That total should be understood as cumulative spending across many governments and years, not as money committed at one moment or to one industry.

The study also finds that the increase survives adjustments for population growth. Using three-year averages to reduce the impact of volatile individual years, every province spent more per person in the 2022–2024 period than during 2007–2009. Quebec recorded the smallest proportional increase under that comparison, at roughly 1.45 times its earlier level, while Ontario recorded the largest. Those patterns strengthen Fraser’s case that the change is broader than a few headline-grabbing corporate deals. At the same time, they do not establish whether individual programs succeeded or failed; the accounting data show what governments spent, not what would have happened to employment, investment or productivity without the support.

Fraser Wants Subsidies Replaced With Broad Business Tax Relief

The Fraser Institute argues that governments should eliminate corporate subsidies and use the savings for broad-based business tax reductions instead. To illustrate the scale, its researchers compare subsidies with corporate income-tax collections. In 2024, federal subsidies represented about 50.6% of federal corporate income-tax revenue under their calculation. Ontario’s ratio was about 85.8%, Quebec’s 91%, and Saskatchewan’s unusually high 213%. Across the federal government and 10 provinces, the institute calculates that the average subsidy-to-corporate-tax ratio during 2020–2024 was 81.2%.

That comparison is an illustration rather than a ready-made tax plan. The researchers explicitly describe their exercise as static: it does not model how companies, investment or government revenue would change after subsidies and tax rates were altered. The broader economic literature is also less categorical than the institute’s conclusion. Research summarized by the OECD and IMF finds that industrial support can sometimes address genuine market failures, promote investment or strengthen strategically important and green industries, but results depend heavily on design, targeting and evaluation. Other academic work finds localized employment benefits from some carefully structured incentives while finding little evidence of broad economic gains from many firm-specific deals. The central policy question, therefore, is not simply whether subsidies exist, but whether each dollar produces benefits large enough to justify its cost.

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