Canada 7th in foreign aid spending, but a fifth goes to refugees inside the country

Canada ranks seventh among the world's richest countries for foreign aid spending, but a significant portion of this aid stays within its borders. According to a recent report by the Organization for Economic Co-operation and Development (OECD), 19% of Canada’s foreign aid in 2023, amounting to $1.5 billion, was used to support refugees and Ukrainians in Canada.

Elise Legault, Canada director of the anti-poverty group One Campaign, noted that this statistic might surprise many Canadians. "Most Canadians would not think that counts, because when we think of foreign aid we think of something happening in other countries, not costs that we have here," she said.

The aid helps refugees and asylum seekers during their initial year in Canada, including Ukrainians who fled the Russian invasion on emergency visas. This domestic spending on refugees aligns with an average of 13.8% among OECD countries, with the United States spending 9.7% and the United Kingdom 28% of their aid budgets domestically.

Despite this significant domestic spending, Legault reassures that it hasn't cut into Canada's core foreign-aid budget, unlike the practices in countries like the U.K. and Sweden. University of Ottawa professor Christina Clark-Kazak explains that whether aid helps refugees abroad or in Canada, it still supports non-Canadians, thus fitting within the broader definition of foreign aid.

Canada’s foreign aid spending reflects a response to global crises, such as resettling 40,000 Afghans and providing healthcare and shelter for asylum claimants. The remaining funds focus on international crises like the conflict in Sudan, hunger in Haiti, and Ukraine, which received 21.4% of the aid, mostly in loans.

The aid sector protested a 15% cut in the 2023 budget for foreign aid outside Canada, arguing it contradicted the Liberals' promise to increase aid annually. The government countered that spending had merely returned to pre-COVID-19 levels.

Despite being the seventh-largest donor in raw dollars, Canada's aid spending is less impressive when compared to its economy size. Last year, it reached 0.38% of GDP, the highest since 1995 but still far from the 0.7% target set by former prime minister Lester Pearson.

Clark-Kazak stresses that aid should not be seen as a zero-sum game, as supporting refugees in Canada helps integrate them into society, benefiting the economy. Both experts urge the government to improve transparency about aid spending, as current reporting is inconsistent and fragmented, making it hard to track pledges and expenditures.

"Transparency is really important from the government, especially in an issue like foreign aid," said Legault. "Canadians have the right to know how much we plan to spend, how much we have spent, and on what."