The federal budget for the year 2023 proposes a comprehensive spending cut of 3 percent for all departments and agencies, a "belt-tightening step" after years of massive growth in the federal public service.

This proposal is one of many liberals who say it will save more than $15 billion in government spending over the next five years.

The government also said that the 3 percent spending cut will be implemented in phases by 2026-27, adding that the plan will save $7 billion over four years.

Finance Minister Chrystia Freeland said the spending cuts will not involve layoffs or reductions in public service staff.

Freeland added that the savings are "the right thing to do" and the government aims to strike a balance between investing in Canadians and continuing to "be a fiscally responsible government."

The budget document, titled "A Made-in-Canada Plan," also states that spending cuts will not affect services.

The budget document says: "Cuts will not affect direct benefits and service delivery to Canadians; direct transfers to other government orders and Indigenous communities; and the Canadian Armed Forces."

In addition to the overall cut, the government also proposes reducing spending on consulting, travel, and other professional services by 15 percent of planned spending in 2023-24, which will save $7.1 billion over the next four years.

Government programs to be reviewed:

The budget also announced a "new review of the effectiveness of government programs," and its first focus will be on skills training and youth programming.

In this regard, the budget said: "The first review will study skills training and youth programs, to determine if improvements can be made to help more Canadians develop skills and gain the practical experience they need to get successful jobs, through the 2024 budget."

The President of the Treasury Board, Mona Fortier, whose department oversees public service management, will lead these reviews.

More funds for the Phoenix pay system:

The budget will allocate $52 million "to improve government payroll management" for the next fiscal year.

This funding is designated for the troubled Phoenix pay system, which continues to face problems years after its implementation, costing the government hundreds of millions of dollars and causing payroll nightmares for tens of thousands of public employees.

Funds for diverse and inclusive public services:

The budget also promises a new mental health fund of $45.9 million for Black government employees.

Also, $45.9 million will be distributed over three years, and new dedicated funding for career development programs, including preparing Black public service leaders for executive positions.

The government proposes $6.9 million over two years to enhance the "Reform Engagement Program," which would empower employees who have experienced harassment and discrimination, and "drive cultural change in the public service."

Funding will also go towards reviewing complaint handling processes for harassment, violence, and discrimination.