On March 28, 2023, the Government of Canada released its 2023 federal budget: A Made-in-Canada Plan: Strong Middle Class, Affordable Economy, Healthy Future. With a complex landscape of policy challenges including inflation and rising costs of living, a lack of housing affordability and availability, a green transition of Canada’s economy, and ongoing recovery from the COVID-19 pandemic, this budget seeks to address those issues and more Canadian realities.

Want to learn more? CMC is here to support you:

In 2022-2023, ahead of this week’s budget, Co-operatives and Mutuals Canada provided budget submissions, met with federal policymakers, and liaised with like-minded organizations to strengthen the policy voice of the co-operative sector. With the release of our recent Economic Impact Report of Co-operatives and Mutuals in Canada, CMC is proud of the vital role that co-operatives and mutuals play in creating economic opportunity – with tens of billions of dollars in economic impact and nearly 600,000 direct and indirect jobs.

About Budget 2023

The 2023 Budget proposes a package of $43 billion in new spending over 6 years, focused on three primary areas: healthcare and dental care, general affordability, and support for Canada’s clean economy and its growth. This investment comes with a deficit projection of $43 billion for 2022-2023 and higher deficits projected for the next five years. As detailed by industry/sector or thematic area, federal budget commitments that may affect co-operatives and mutuals include:

Agriculture and Food Security

Dairy R&D

Canada has committed to establish a Dairy Innovation and Investment Fund – expected to benefit agricultural co-operatives primarily in Ontario and Quebec. $333 million, invested over ten years starting in 2023-2024, will help invest in research and development for new product usages for certain dairy processing by-products. Co-ops are explicitly mentioned as expected beneficiaries; therefore, CMC anticipates that dairy co-ops will be eligible to apply.

Interest Relief for Agricultural Producers

$13 million will be provided to Agriculture and Agri-Food Canada to “increase the interest-free limit for loans under the Advance Payments Program (APP) from $250,000 to $350,000 for the 2023 program year”. Agricultural production co-operatives are eligible to apply for the existing APP under current criteria and are expected to benefit from this increased limit to ensure they have access to sufficient cash flow.

Diversifying Away from Russian Fertilizers

Agriculture co-operatives will benefit from $34.1 million over three years for the On-Farm Climate Action Fund to alleviate impacts on Eastern Canada farms that rely on imported fertilizer that has experienced exceptionally high prices due to the Russian invasion of Ukraine. The Fund will “help optimize the use and reduce the need for fertilizer” by agriculture organizations.

Local Food Infrastructure Fund

Budget 2023 invests $10 million to boost the Local Food Infrastructure Fund, supporting “community-led efforts” to address food insecurity and investing in infrastructure required to produce, store, and deliver locally-sourced food.

Diversity, Inclusion, and Community-Building

Budget 2023 announces a range of funding initiatives to support diverse and inclusive communities, which may benefit non-profit co-operatives providing community services or other co-operatives engaging in community-building work, including:

  • $108 million for Regional Development Agencies to disburse for the development of local projects and events to recover Canada’s tourism sector from COVID-19 effects,
  • $117 million to provide “increased support for the non-profit organizations” that serve official language minority communities, particularly those who train bilingual nurses, personal support care workers, and promote French language research,
  • $208 million to expand the Enabling Fund for Official Language Minority Communities to support local official language minority community organizations that deliver employment assistance services,
  • $25.4 million to support Canada’s Anti-Racism Strategy,
  • $25 million for the Supporting Black Canadian Communities Initiative to continue empowering Black-led and Black-serving community organizations,
  • $160 million for the Women’s Program, funding women-serving organizations, particularly those that serve marginalized and racialized communities,
  • $10 million to invest in capacity building and community work by disability organizations,
  • $14 million for Building Communities Through Arts and Heritage to support festivals, events, and projects that support those aims.

Employee Ownership and Worker Co-operatives

Following a commitment in Budget 2022 to explore the tax framework required for Employee Ownership Trusts (EOT), Budget 2023 commits to make tax changes to allow for EOTs to be created as a solution for succession planning within small and medium enterprises (SMEs). Generational renewal is a key concern as SMEs are owned by an aging population and communities may experience job losses without a plan for succession to new owners that will otherwise cause the closure of SMEs.

EOTs, allowing owners to sell their business to worker-owners, are considered another viable policy option alongside worker co-operatives. Essential to us is that worker co-ops remain – in the view of Canadian governments – a viable, appealing, and robust option as SMEs consider converting themselves to a co-operative model, and that government facilitates the success of that option with a policy environment open to worker co-ops and other related types of co-ops.

The Canadian Worker Co-op Federation (CWCF) and CMC have long advocated for worker co-op conversions as a succession planning strategy. CMC and CWCF intend to engage with the government on the next steps of EOT implementation to ensure that worker co-ops receive comparable treatment by government and are not disadvantaged. The budget commits to solicit “stakeholder feedback on how best to enhance employee rights and participation in the governance” of EOTs, which suggests upcoming opportunities for those of us in the co-operative movement, working with the leadership of CWCF and CMC, to have our say.  

As noted in the GBA+ (Gender-Based Analysis) review of this proposal, the Government of Canada notes that they would require EOTs to “ensure a broad subset of employees, including part-time employees, are included as beneficiaries … these latter employees are more likely to be younger, women, and have lower incomes” in order to benefit from any tax changes. This consideration provides a further favourable opportunity to engage with government as worker co-ops can provide a highly democratic option to share ownership with diverse worker-owners who are involved in creating inclusive economic growth.

Energy and Environment

Budget 2023 commits to a wide range of climate-related initiatives, particularly tax incentives like a 15% refundable tax credit for eligible investments in clean electricity, $500 million for the Strategic Innovation Fund (SIF) to support the development and application of clean technologies, and $1.5 billion of existing funds from the SIF towards projects in clean tech. Co-operatives operating in renewable energy or green technologies may be eligible pending further program information and criteria.

Financial Services and Credit Unions

Implementing the Tax-Free First Home Savings Account

As of April 1, 2023, financial institutions, including credit unions and caisses populaires, can offer a non-taxable home savings account to allow first-time home buyers the opportunity to save $40,000 towards their first down payment. This was a commitment in Budget 2022 and will be implemented this April. Withdrawal of their down payment remains tax-free and can also be paired with the First-Time Home Buyers’ Tax Credit for an extra $1,500 in tax relief.

Protecting Canadians with Existing Mortgages

Federally regulated financial institutions will be required to provide relief measures to Canadians who hold existing mortgages with those institutions in ways that are fair and equitable, including extended amortizations, adjusted payment schedules, lump-sum payments, and temporary mortgage amortization extensions. While many Canadian credit unions and caisses populaires are regulated provincially, this affects co-operative stakeholders who are regulated federally – who also provide mortgage products – including (but not limited to) Coast Capital Savings, Concentra, Alterna, and UNI Financial Cooperation.


Budget 2023 includes several commitments to enhancing housing supports and development of new projects, with housing co-operatives expected to play a continued role as Canada seeks to alleviate our housing crunch and unaffordability issues. The prior year’s federal budget committed to double the number of new homes built in Canada by 2032, with the support of stakeholders including housing co-ops and their sectoral conveners.

Budget 2023 newly explores topics including the growing concern around “financialization” of housing in Canada, a positive indication for co-ops that provide non-profit housing solutions that suggests they will continue to have support from government decision-makers.

More details remain unannounced on most initiatives – as details will become known in the coming months during the implementation stage and as government consults on the exact language around policy design.

We expect CMC and our members, including the Co-operative Housing Federation of Canada, will engage with government to ensure co-ops have full access to funding opportunities as with all areas of government support.

Those potential opportunities include funds like:

  • An additional $4 billion, over seven years, starting in 2024-25, to implement a co-developed Urban, Rural, and Northern Indigenous Housing Strategy focused on providing housing options in partnership with Indigenous communities;
  • Reallocated funding from the National Housing Co-Investment Fund’s “repair stream” to its “new construction stream” to accelerate the building of new units.

Insurance & Healthcare

Canadian mutuals providing insurance products, and healthcare co-ops delivering healthcare services, may be affected by the following Budget 2023 measures:

Dental Coverage

The Government of Canada will provide $13 billion over five years, starting in 2023-2024, for the Canadian Dental Care Plan – providing coverage for uninsured Canadians with lower family incomes and no co-pays for the lowest-income families. Budget 2023 commits to launch this plan in late 2023 with administration by Health Canada and support from a “third-party benefits administrator” not yet identified in the budget; it is to be announced if that administrator has been selected or if insurers will be invited to bid on the opportunity.

Reproductive Healthcare Services

Budget 2023 will provide $36 million over three years for a renewal of the Sexual and Reproductive Health Fund – supporting “community-based organizations” that enable access to abortion and other sexual and reproductive health services for vulnerable populations. Eligibility criteria is not yet known or announced but may include co-operative healthcare providers such as community health centre co-ops.

Home Flooding Coverage

$31.7 million in funding over three years will be provided to Public Safety Canada and the Canadian Mortgage and Housing Corporation to create a new “low-cost flood insurance program” for households that cannot access adequate insurance from other home insurance product providers, by “offering reinsurance through a federal Crown corporation and a separate insurance subsidy program”.


We look forward to continued advocacy on behalf of Canadian co-operatives and mutuals. If you have questions, are assessing the impact of a new budget commitment on your organization, or want to connect further, please contact:

Diamond Isinger
Director of Advocacy, Co-operatives and Mutuals Canada