Salgo: Trump may fire government officials, but in Canada it’s not so easy

By Karl Salgo, Associate and Executive Advisor

Published in the Ottawa Citizen on September 9, 2025

Legislation has created arms-length agencies and commissions for a reason. And in Canada, politicians mostly understand they shouldn’t interfere.

Chair of the U.S. Federal Reserve Jerome Powell speaks with Lisa Cook, member of the Board of Governors of the Federal Reserve, during a meeting on June 25, 2025. US Federal Reserve Governor Lisa Cook filed a lawsuit on Aug. 28, 2025, to challenge Donald Trump’s move to fire her. Photo by SAUL LOEB /AFP via Getty Images

It’s no secret that the U.S. president would like to fire the chair of the U.S. Federal Reserve, but, facing opposition from pretty much everyone, he appears to be settling for one of the Reserve’s governors. This isn’t the first supposedly independent official to get the axe for angering the president: The commissioner of the U.S. Bureau of Labor Statistics was sacked a few weeks ago, and the list goes on.

To the president’s supporters, it’s a no-brainer that the head of the executive arm of government gets to tell everyone else in the executive what to say and do, and to sack them if they won’t obey. But that isn’t quite how it’s supposed to work. In both the United States and Canada, certain government jobs are meant to be done without direction from politicians.

And that’s mostly for the best.

Canadian prime ministers have often felt the way their U.S. counterpart does about appointed officials. Still, no prime minister has fired a governor of the Bank of Canada, as Pierre Poilievre threatened to do when running for the Conservative leadership, although several have probably wanted to and one actually tried.

In the early 1960s, there was a notorious public row between bank governor James Coyne and then-prime minister John Diefenbaker. The prime minister tried to force Coyne out via legislation, but Parliament didn’t cooperate. Coyne did eventually resign, but in the end it was a win for the Bank of Canada because legislation was later passed to put its independence on even firmer footing.

There have been other public conflicts between ministers and their officials — ranging from a former chief statistician of Canada to a former chief electoral officer. Neither ministers nor their appointees emerged from these conflicts unscathed.

Such struggles sometimes happen because, even though the Canadian and U.S. systems are different, in both countries certain appointed officials who are not part of the career public service are supposed to work free from political interference.

James Coyne was the second Governor of the Bank of Canada, from 1955 to 1961. Photo by Milne Studios Ltd. /Bank of Canada Archives

In Canada, most of these officials hold senior positions in “arm’s-length” organizations such as agencies, boards, commissions and, in some cases, Crown corporations. Under legislation, they often make decisions or issue reports without ministerial direction or approval. And many of these officials have strict job security to make sure they’re not fired for doing so.
Although I think there are too many arms’-length organizations, most exist for good reasons. Sometimes it’s for operational effectiveness, such as letting airports and commercial Crown corporations run more like a business. The people in charge get a fair amount of operational independence, but they don’t typically get much job security. In legal terms, they serve “at pleasure.” In other cases, the goal is to protect the integrity of the job — for example, the work of Agents of Parliament such as the Chief Electoral Officer, the Parliamentary Budget Officer, and the Auditor General. Such officials usually have fixed terms, sometimes long ones, and it’s very difficult to remove them.

Ministers are seldom happy about what Auditors General have to say but they can’t fire them for criticizing the government. Indeed, Agents of Parliament have the most secure tenure of any Canadian official. Similar but less ironclad job security is also given to ombudspersons, who are often critical of their own departments, as well as adjudicators on administrative tribunals who make court-like decisions.

Parliament also puts some regulatory and even operational decisions at arm’s-length from politicians, typically in highly specialized fields where ministerial interventions could be unhelpful. You don’t want ministers determining safety standards at nuclear power plants or undercutting our currency for short-term economic goals. And personally, I’m glad my pension fund isn’t directed by people who see lots of great investment opportunities in their own ridings.

Is this arrangement a good one? Yes, provided that appropriate guardrails are in place.

Appointed officials exercise their discretion within strict statutory limits, and ministers still retain a range of authorities just in case they go rogue. Depending on the circumstances and type of organization, ministers can set general rules, alter specific regulatory or quasi-judicial decisions, or issue binding directions. The threshold for such actions is usually high, especially for organization-specific directives, but they can include general requirements like banning expensive travel.

Beyond that, officials can always be removed “for cause” — that is, due to misconduct or incompetence — either by cabinet or the responsible minister. However, “cause” is not an endlessly pliable legal concept; aside from criminal acts such as fraud it usually means the official isn’t following applicable legislation.

For instance, following a dispute about the meaning of nuclear safety, a former minister of Natural Resources fired the head of the Canadian Nuclear Safety Commission from her presidential role back in 2008, where she didn’t have job security, but left her on the commission, where removal would have required cause.

Even if they don’t care about political fallout, governments that simply attach the label of “cause” to actions they disagree with may find themselves at the losing end of a lawsuit. And so they should.