Newcomer agencies in Waterloo Region brace for service cuts after federal funding reduction

How are immigrant support services in Waterloo Region dealing with federal funding cuts? CTV’s Spencer Turcotte reports.

Organizations that help newcomers settle in Waterloo Region say they are being asked to do more with less after another round of federal funding cuts to settlement services.

At the Kitchener-Waterloo Multicultural Centre, services range from translation and employment support to English language learning and referrals to community programs — supports staff say are critical for newcomers during their first years in Canada.

“Orientation, referrals to services, employment supports,” said Lucia Harrison, CEO of the Kitchener-Waterloo Multicultural Centre, describing the range of services offered.

But Harrison said the centre is now preparing for significant changes after federal funding reductions for newcomer services were announced for the second year in a row.

“We will see further cuts right up until the end of 2028,” she said.

Immigration, Refugees and Citizenship Canada (IRCC) said the reductions are tied to the federal government’s broader spending review and a shift in immigration targets.

In a statement to CTV News, IRCC said it plans to invest approximately $935.7 million in settlement services outside Quebec in 2026-27 — a decrease of about $98.1 million from previously planned spending.

The department said the 2026-2028 Immigration Levels Plan focuses on “a return to sustainable immigration and a shift to more economic immigrants, who tend to use settlement services less intensively.”

IRCC also said limiting how long economic immigrants can access services is intended to encourage earlier use and ensure support remains available for those who need it most.

Despite reduced immigration targets, local agencies say demand for services will remain high in the near term.

“People see us in their first, second, third, fourth year here,” Harrison said, adding the organization expects waitlists to continue even with fewer staff.

The centre has already reduced staffing due to earlier funding changes.

“We lost four positions last year. This year, we’ve had to lay off three people. There was another position that had recently been vacated that we’re not going to fill,” Harrison said. “So that’s eight positions over two years.”

Changes to eligibility rules are also coming. Immigrants selected based on their ability to contribute to the economy will now have a six-year window after becoming permanent residents to access settlement services. That window is expected to shrink to five years beginning next year.

Reception House Waterloo Region said the funding cuts are already creating gaps in services.

“Settlement services are not optional, they’re essential infrastructure,” said Babur Mawladin, CEO of Reception House Waterloo Region. “When the funding is reduced, newcomers face longer wait times, fewer supports or delayed access to housing, employment, health navigation.”

Mawladin said limited access to early support can lead to more serious challenges later.

“That’s not only difficult for newcomers, but also far more expensive for the government and communities,” he said.

In a separate statement, YMCA of Three Rivers said recent funding reductions linked to the federal government’s Comprehensive Expenditure Review are already forcing operational changes.

The organization said language training and employment workshops have been paused and staff positions reduced, directly affecting the availability of services.

“Settlement services are critical to helping newcomers attain employment, stability and a sense of belonging,” the statement reads. “Reductions to these programs risk increasing vulnerability, delaying workforce participation, and limiting newcomers’ ability to fully integrate into their communities.”

Agencies said the cuts could also impact newcomers’ sense of belonging, as reduced support may slow integration into Canadian communities.

They are now urging decision-makers to restore stable funding to maintain services and help newcomers succeed.