Federal government spent more than $800M on AI technology over three years

Canada’s federal government disclosed spending over $831 million on artificial intelligence technology from January 2023 to March 2026, according to data compiled by The Canadian Press. The total includes two high-profile contracts: a $350 million agreement with Dayforce to replace the troubled Phoenix pay system and a $240 million investment in AI company Cohere. Other expenditures ranged from small ChatGPT subscriptions to multimillion-dollar deals with firms like Microsoft, Sailpoint Technologies, and Ecopia Incorporated. Public Services and Procurement Canada and Innovation Canada were the top spenders, followed by National Defence ($83.7 million) and the Canada Revenue Agency ($29.9 million). The Canada Revenue Agency allocated $17.5 million to Sailpoint for machine learning-based analytics to detect high-risk users, while National Defence spent $6.3 million on Ecopia’s satellite imagery mapping software. Veterans Affairs Canada directed nearly all its $25.1 million toward an AI tool processing veterans’ medical records to generate claim summaries. The government emphasized the spending reflects diverse categories, including AI-enabled tools, digital modernization projects, and support for Canadian AI firms. However, Conservative MP Jagsharan Singh Mahal noted not all departments complied with his request for full disclosure, suggesting the actual total may exceed $831 million. Intelligence agencies CSE and CSIS declined to share details, citing national security and mandate restrictions. Smaller but targeted AI projects were also reported, such as Fisheries and Oceans Canada’s $1.27 million investment in AI.Fish for fishery management, including ghost-gear detection. National Defence led in contract volume with 104 agreements, while the National Research Council Canada and Innovation Canada followed with 61 and 38 contracts, respectively. The spending highlights Canada’s expanding reliance on AI across public services, defense, and administrative functions.