Alternative federal budget 2026-27: Racial equity

This is from a larger publication, Alternative federal budget 2026-27: Bridge to independence

Introduction

With news of the Ebola outbreak spreading, Canada took on the unenviable distinction of being the first country in the world to ban immigration from Ebola-affected regions in Africa—specifically the Democratic Republic of the Congo, Uganda, and South Sudan. The government used new powers granted to the immigration minister under Bill C-12—Strengthening Canada’s Immigration System and Borders Act¹ to mass cancel visas and suspend processing of all other immigration documents² (See Immigration chapter). Canada and the U.S. are the only countries to suspend non-citizen entries for people from the specified regions. Meanwhile, Canada’s own assessment at the time acknowledged the risk remained low, consistent with the risk assessment by the World Health Organization.³

This response reflects a lack of principled policy approach and appears opportunistic. Such actions risk being either explicitly discriminatory or may result in disproportionate adverse impacts on Black and racialized populations. A commitment to racial equity and other equity considerations, such as (but not limited to) the current federal anti-racism strategy,⁴ is virtually invisible under this government. Investments in equity measures are done quietly. Progress reports on ongoing commitments—such as the Anti-Racism Framework for the Federal Public Service, including the current anti-racism strategy⁵—are missing or not shared with the public.

Overview

Canada proposed and was successful in having the UN adopt a second International Decade for People of African Descent but has been silent on any progress since the announcement.⁶

This is deeply troubling against a background of ongoing systemic discrimination, rising racism and xenophobia in public discourse, and deepening discrimination at the intersections of citizenship status, religious identity (especially Muslim), gender, and gender identity. Many civil society actors, as well as Black and racialized people in the public service, worked long and hard to gain acknowledgment that racial inequality is deeply rooted in Canadian structures such as the labour market, criminal justice system, education, housing, and health care. These systems exclude Indigenous, Black, and racialized communities from full economic and social participation. It is, therefore, discouraging that the government is now silent on these issues, especially as Canada heads into harsh economic times (see Gender equality chapter).

Investments and misses

While the 2025 budget was silent on the following, this year’s spring update extended support for Canada’s Anti-Racism Strategy to 2027-28 ($33 million per year) and a very small investment ($3 million per year to 2027-28) for the Federal Anti-Racism Secretariat.

The spring update also contained measures that would positively impact Black and racialized people who are disproportionately represented in the affected populations, including support for sheltering asylum claimants ($188 million per year to 2029-30) and funding for the migrant worker support program (for 2026-27). Last year’s budget mentioned the over-representation of Indigenous, Black, and racialized people in low-wage work, poverty, poor health outcomes, housing insecurity, and food insecurity, but did not then go onto dismantle systemic barriers that create economic exclusion—such as removing immigration status criteria from the Canada Child Benefit and residency requirements for Old Age Security; measures that have a disproportionate impact on racialized immigrants. While the budget did include some positive measures, such as making the national school food program permanent, supporting the recognition of foreign credentials and the personal support worker (PSW) tax credit, these are limited in scope and do not dismantle the underlying systemic inequities that create significant disparities.

Immigration system changes impact racialized people

Bill C-12’s changes to the immigration and refugee system, including cuts to refugee health care, will have disproportionately harmful impacts on Black and racialized people, as covered in greater detail in the AFB immigration chapter.

Of the three countries at the centre of the Ebola health emergency—where the government has suspended temporary visas and paused immigration processing—there is an administrative deferral of removals to Sudan and a temporary suspension of removal to the Democratic Republic of Congo. Uganda is not on the moratorium list, despite the cancellation of visas and temporary pause on processing.⁷

The government has failed to go ahead with recommended changes to Employment Insurance to extend eligibility to workers who are currently under-represented among claimants (see Employment Insurance chapter). A class action Charter of Rights and Freedoms challenge was filed on behalf of 75,000 Caribbean and Mexican farmworkers in the Seasonal Agricultural Workers Program, including the systematic exclusion of those workers from Employment Insurance benefits despite being required to pay premiums. The challenge was certified in the Ontario Superior Court of Justice.⁸ As the government itself warns Canadians of harsh economic times ahead, including job loss, we know from history that racialized people will be the first to lose jobs and will take the longest to regain employment and earnings.

Bail reform and over-incarceration

Following the passage of Bill C-12, bail provisions have been changed, with further changes pending from Bill C-2. Indigenous and Black people are disproportionately represented in the carceral system and will feel the greatest impacts.⁹ They are also more likely to be low-income and have fewer financial and non-financial supports. Further, the Auditor General’s report on Correctional Services documents how racialized people are over-incarcerated and treated differently within correctional facilities.¹⁰

Enforcement of drug laws and biased policing practices disproportionately incarcerate Black, Indigenous and racialized people. Justice Canada found that between 2007-08 and 2016-17, drug offences were the majority of all mandatory minimum offences for which people were admitted into a federal institution, and Indigenous, Black, and racialized people are overrepresented in these numbers.¹¹ Canada’s Black Justice Strategy recommends the removal of criminal penalties and criminal records for drug convictions to address the overrepresentation of Indigenous, Black and racialized people in carceral institutions.¹² These concrete recommendations are yet to be realized.

Community-based supports for people facing criminal charges are insufficient, particularly in Indigenous and Black communities outside large urban centres. There is urgent need for bail reform, an end to the over-incarceration of Indigenous and Black people, and community-based supports for those facing criminal charges.

Need for anti-racism legislation

We still do not have federal anti-racism legislation (Ontario remains the only province with anti-racism legislation).¹³ We need it to provide a legislative foundation for the Federal Anti-Racism Secretariat. While the secretariat is tasked with combatting systemic racism and racial discrimination, it does not have the legislative power or tools to effectively carry out that mandate. The secretariat was moved in late 2024 from the Department of Canadian Heritage to Employment and Social Development Canada, under the junior Minister of Diversity, Inclusion and Persons with Disabilities. The secretariat leads the implementation of the national anti-racism strategy and has its own budget, but it does not report independently to parliament.

Legislation is necessary to support a whole-of-government approach, including making the commitment to racial equity explicit in GBA+ budgeting and dismantling systemic racism.

The government’s previous commitment to ongoing funding to Statistics Canada for disaggregated data collection is a significant win.¹⁴ Disaggregated data has helped identify racial inequalities and document trends in areas such as income inequality, rates of criminal incarceration and immigration detention, health outcomes, environmental racism, equitable representation in federal public service jobs, and investment in services. This must be strengthened by mandating the collection of disaggregated data across all government activities to ensure all Canadians are included and benefit equitably.

Racism and discrimination

Indigenous, Black and racialized people continue to face systemic discrimination, racism and hate, poorer life chances and are more likely to face criminalization.

Black people experience the highest rate of violence and hate in Canada, with no dedicated funding stream to address it. Recent data shows anti-Indigenous hate is now the highest, followed by anti-Black hate. Statistics Canada acknowledges these crimes are significantly under-reported, meaning actual rates are higher than data suggests.

As police-reported crimes are often the only yardstick to plan budgets, government investment typically overlooks and excludes Indigenous, Black and racialized people. Racialized communities are facing higher incidents of racism and discrimination, with certain communities facing higher levels of racist attacks linked with religious identity—particularly Muslims—and at the intersections of race and gender. The government has been framing issues as “hate” rather than “racism”, which leaves a gap in how systemic discrimination is addressed and resourced.

Racial disparities are also evident in Canada’s response to international humanitarian crises, both in international aid as well as immigration and refugee measures, and they must be addressed through an independent inquiry (see Immigration chapter).

Time-limited funding for key strategies

Funding for the Black Justice Strategy and the The Mental Health of Black Canadians Fund is only until 2027, despite clear evidence of the need for ongoing funding for both.

The government committed funding until 2026 to advance equity and racial justice, to comprehensively root out the barriers to equal opportunity that marginalized communities continue to face, and to establish a trilateral Racial Equity and Inclusion Expert Network from a tripartite agreement between Canada, the United States, and Mexico.¹⁵ This funding led to the creation of the Canadian Network for Equity and Racial Justice (CNERJ), which has brought together Indigenous knowledge keepers, grassroots organizers, policy experts, labour, the private sector, academic researchers, and engaged young people from across Canada, Mexico, and the United States. CNERJ contributes directly to national efforts to advance equity and racial justice, and in the present climate, provides guidance on how to pursue economic stability and growth rooted in fairness while including all Canadians, particularly those challenged by barriers to equity. Ongoing funding is needed to continue this important initiative.

Systemic anti-Black racism

In December 2023, the Senate Standing Committee on Human Rights re-affirmed the March 2023 findings of the Treasury Board of Canada Secretariat that discrimination and systemic anti-Black racism occurred at the Canadian Human Rights Commission. Black federal public service employees and Black and racialized complainants to the commission were impacted by anti-Black racism and racism. The committee made 11 recommendations to combat anti-Black racism and bring about systemic change, including by appointing a Black Equity Commissioner. They include the recommendation to remove the term ‘visible minority’ from the act. The federal Employment Equity Act covers the workforce under federal jurisdiction and the expanded scope of the Federal Contractors Program; this represents a small number of all workplaces and workers in Canada, yet the act and its full implementation have the potential to lead and exert a positive influence over other jurisdictions. The act was reviewed and final report submitted to the government, containing comprehensive recommendations to move Canada closer to dismantling systemic anti-Black racism and racism and establish substantive equality. However, implementation is at a standstill.

Actions

The AFB will create an Anti-Racism Act that will name and address all forms of systemic racism and hate. This will give a legislative foundation to an independent Anti-Racism Secretariat that reports directly to parliament and has its own budget.

The AFB will create a National Action Plan with metrics to accompany the national Anti-Racism Strategy. The plan will have concrete strategies with actionable goals, measurable targets, timetables, and resource allocations for each strategy. It will be used to fund community-based efforts across Canada to address all forms of racism and hate.

The AFB will include an intentional racial equity framework in the Gender-based Analysis Plus budget, federal poverty reduction efforts, the National Housing Strategy, and the Canada-wide Early Learning and Child Care Plan.

The AFB will mandate a racial equity framework for all reviews—including funding programs by federal government departments—and specific action plans on eliminating racial disparities and inequalities in Indigenous, Black, and racialized communities in the targeted areas.

The AFB will mandate intersectional data collection and include a clause on racial equity, with disaggregated data collection in health and the future funding transfers to provinces and territories. Disaggregated and intersectional data will also be collected across all relevant Sustainable Development Goals.

The AFB will collect data and report on the percentage and dollar values of federal funding to racialized-led and -focused organizations and federal contracts to racialized-owned businesses.

The AFB will collect data and report on the diversity of senior management and boards within the federal government and in federally regulated organizations.

The AFB will implement the recommended federal Employment Equity Act reform, including elimination of the term ‘visible minorities’, and strengthen the implementation of the Employment Equity Act across all positions to address the under-representation of Indigenous, Black, and other racialized federal employees—particularly in executive and management positions.

The AFB will attach employment equity measures (via community benefits agreements) to all federal investment and recovery programs to ensure racialized and other under-represented groups have equitable access to new jobs and economic opportunities created.

The AFB will address all forms of oppression within the federal public service in consultation and collaboration with Indigenous, Black, and racialized employees, and make anti-oppression, anti-racism, and anti-discrimination training mandatory for all public service employees and managers.

The AFB will act on and report on the progress of the recommendations made by the United Nations Working Group of Experts on People of African Descent mission to Canada.

The AFB will provide ongoing funding for the Canadian Network on Equity and Racial Justice to continue the work already begun to establish the trilateral Racial Equity and Inclusion Expert Network.

The AFB will implement recommendations in Canada’s Black Justice Strategy, including the removal of criminal penalties for drug possession and criminal records suspension for drug possession-related offences.

The Monitor

Our Schools/Our Selves

Alternative federal budget 2026-27: Racial equity

Introduction

Overview

Investments and misses

Immigration system changes impact racialized people

Bail reform and over-incarceration

Need for anti-racism legislation

Racism and discrimination

Time-limited funding for key strategies

Systemic anti-Black racism

Actions

About the author

Alternative Federal Budget Working Group

Alternative federal budget 2026-27: Health care

Alternative federal budget 2026-27: First Nations

Alternative federal budget 2026: Racial equity

Budget fédéral alternatif 2026 : Équité raciale

Alternative Federal Budget 2020

Budget fédéral alternatif 2020

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