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While industry groups are rallying to preserve the current Canada Music Fund model, release guru believes it’s time for something deeper than renewal — it’s time for reform. The intermediary system built around FACTOR and Musicaction does not work for most artists or emerging music companies. It concentrates power, slows progress, and filters public money through layers of bureaucracy before it ever reaches the people creating the culture.

With the federal government moving the 2026 budget up to November 4, 2025, decisions about the future of Canadian music funding are happening now — not next spring. This moment is critical. Instead of fighting to extend a broken system, we’re calling on leaders to rebuild it from the ground up: a direct, transparent, human-centred model that funds artists, not gatekeepers.

An Open Letter — To:

The Right Honourable Mark Carney, Prime Minister of Canada
The Honourable Steven Guilbeault, Minister of Canadian Identity and Culture
The Honourable François-Philippe Champagne, Minister of Finance and National Revenue

RE: Rebuild Canadian music funding — replace gatekeeping with direct, human-centred support

Dear Ministers Carney, Guilbeault, and Champagne,

I am writing to urge you to take necessary, deliberate, and decisive action — not to extend the current intermediary-centric funding model — but to modernize it with a direct, human-based approach that restores trust, cuts waste, and grows Canadian cultural IP where it originates: with artists and the small teams that support them.

Over the last cycle, the Department’s own evaluation of the Canada Music Fund found persistent administrative burden and data-transparency gaps in delivery via FACTOR and Musicaction — issues that particularly affect emerging and self-managed artists. Modernization in 2020 did not resolve these pain points.

This is about confidence and competition. On June 12, 2024, FACTOR suffered a one-time fraudulent wire of $9,772,875.33, later confirmed publicly. Canadians deserve clarity on what failed and what has been fixed — and artists deserve a model that doesn’t ask them to carry the cost of governance breakdowns.

The current architecture is exclusionary in effect

In FY 2024–25, FACTOR ran a single national JSR: Album intake; 20 of 370 applications were approved — a ~5.4% success rate. That is not a functioning on-ramp for new artists — it is a bottleneck.  (Source: FACTOR email to applicants, Dec 12, 2024.)

At the same time, FACTOR’s Company Envelope programs reimburse up to 50% of eligible expenses with annual caps up to $600,000 per company ($800,000 for affiliated companies) — a design that halves incumbents’ marginal costs across multiple projects. Taken together, this produces anti-competitive effects: a 5% success “competitive” program for newcomers with limited funding scope alongside a 50% broad-stroked cost relief for incumbents.

Budget 2025 will be tabled on November 4, 2025 — the first under Canada’s new fall budget cycle. Meanwhile, expected contributions from online streamers remain under judicial review, creating uncertainty about near-term inflows. A clearer, fairer architecture should be in place before any new money arrives.

What to do now — high-impact changes with low friction

1) Launch a Direct Artist Minimum Income (DAMI) pilot — delivered via CRA rails.

Provide a taxable, eligibility-based income floor that buys time to develop IP and audiences — paid monthly, audited through existing CRA infrastructure. 

Illustrative costing: $10M supports ~500 artists at $20,000 each; 2,000 artists × $18,000 ≈ $36M; 5,000 ≈ $90M.

Fund using a portion of the existing top-up plus a targeted Budget 2025 allocation, and evaluate quarterly. Ireland’s Basic Income for the Arts — €325/week — reports strong results and is moving toward permanence; Canada can adapt that model.

2) Seed new Canadian-owned companies and collectives — milestone-based, not envelope-based.

Replace large, flexible envelopes with open, milestone tranches for SMEs and collectives building catalogues, exportable IP, and fanbases. Pay against verifiable progress — releases shipped, shows booked, audience growth, rights administered — rather than long narratives and legacy catalogue revenues.

3) Enforce ethical competition across all public support.

Open access and transparent rules; decision and payment SLAs (e.g., decisions ≤ 10 business days; disbursement ≤ 5 days); overhead discipline; open data on awards within 30 days; a live conflict-of-interest register with recusal logs. 

When intermediary expertise is valuable, buy it as a service — procured or contribution-based agreements with SLA-style performance clauses and audit rights — rather than as a gate.

4) Deliver locally — regional hubs, not gatekeepers.

Stand up regional hubs co-designed with provinces/territories and Francophone partners — a Trade Commissioner Service for music — to provide hands-on advisory and small scale co-funding directly to artists and SMEs.

5) Plan for stability — a 5-year support arc.

Commit to a five-year framework: 

Years 1–2 — DAMI income floor + micro-supports for cost-of-living and early market entry. 

Years 3–5 — milestone-based SME tranches; intermediary services under performance-based agreements; open reporting. Grandfather existing multi-year commitments and migrate new intakes to the re-architected model.

Why this matters

Get money closer to creators and the economy responds. New, first-of-its-kind data show Canada’s live music ecosystem generated $10.92B GDP, ~101,600 jobs, and $3.73B in taxes in 2023 — with room to grow under a fairer, more transparent system.

In short: Use Budget 2025 to pivot from gatekeeping to a direct, human-centred model of ethical competition — pilot DAMI, seed new companies and collectives with milestone funding, cut red tape, and publish open data. This is a measured, fiscally responsible modernization that will strengthen Canada’s global relevance — and finally align public investment with the people who create the IP.

Sincerely,

Nich Davies

CEO | hhmusic x release guru
e.  [email protected]
⚲  Benalto, Alberta CANADA

Selected references

• Evaluation of the Canada Music Fund (2018–19 to 2022–23) — Summary: https://www.canada.ca/en/canadian-heritage/corporate/publications/evaluations/canada-music-fund-2018-2023/summary.html

• FACTOR — Response to the Scotiabank Cybertheft (Nov 26, 2024): https://www.factor.ca/factors-response-to-the-scotiabank-cybertheft-the-facts/

• FACTOR — Company Envelope: Top-Tier (up to 50%; caps up to $600k / $800k): https://www.factor.ca/programs/company-envelope-top-tier/

• Finance Canada — Modernizing Canada’s Budgeting Approach (Budget 2025 on Nov 4, 2025): https://www.canada.ca/en/department-finance/news/2025/10/modernizing-canadas-budgeting-approach.html

• CRTC — Online streaming services required to contribute 5% (Order under appeal): https://www.canada.ca/en/radio-television-telecommunications/news/2024/06/crtc-requires-online-streaming-services-to-contribute-to-canadas-broadcasting-system.html

• Federal Court stay reference (summary): https://web.crtc.gc.ca/eng/acrtc/prx/2025idiz.htm

• Canadian Live Music Association — “Here and Now” economic impact (2023: $10.92B GDP; ~101,600 jobs): https://www.canadianlivemusic.ca/news/hearandnowpr

• Trade Commissioner Service — SME support model (analogy for regional hubs): https://www.tradecommissioner.gc.ca/en.html