Cost of federal IT project explodes to up to $6.6 billion

OTTAWA — The federal government says it could end up spending up to $6.6 billion to update the systems it uses to deliver benefits to Canadians — more than three times what was budgeted at the project’s launch.

The initiative involves migrating Old Age Security, the Canada Pension Plan and Employment Insurance benefit programs to a cloud-based platform.

The modernization project is led by Employment and Social Development Canada and the government initially set aside $1.75 billion for the work in 2017.

A document shared by the department says the spending cap has been updated over time because of the rise in cybersecurity threats, greater understanding of the complexity of the work required and an expansion of the project.

As of December 2025, the document says actual spending on the project amounted to $1.8 billion.

While the program’s original timeline called for completion by 2030, the document says the projected completion date range is now 2030—31.

This report by The Canadian Press was first published March 19, 2026.

Catherine Morrison, The Canadian Press