WASHINGTON, Jan 28 (Reuters) - President Donald Trump's White House has directed a halt to all federal grants and loans, effective Tuesday. This broad move could impact various programs, including those related to education, healthcare, housing assistance, disaster relief, and other initiatives that rely on billions in federal funding. In a memo issued Monday, the acting director of the Office of Management and Budget, which oversees federal finances, announced the freeze while the administration reviews these grants and loans. The review aims to ensure alignment with the priorities set by President Trump, including the executive orders he signed last week to eliminate diversity, equity, and inclusion programs.
The OMB memo said Tuesday's freeze included any money intended "for foreign aid" and for "nongovernmental organizations," among other categories.
The White House said the pause would not impact Social Security or Medicare payments or "assistance provided directly to individuals." That would presumably spare disability payments and the SNAP food program for the poor, though it was not clear whether health care programs for veterans and low-income people would be affected.
Trump, who took office on January 20, has swiftly ordered a halt to nearly all domestic and foreign aid. This follows his decision last week to freeze U.S. assistance abroad. The U.S. is the world’s largest donor of aid, contributing $72 billion in 2023. As part of the aid suspension, the administration began taking steps on Tuesday to stop the supply of lifesaving drugs for HIV, malaria, and tuberculosis, along with medical supplies for newborns in countries receiving support from the U.S. Agency for International Development.
The OMB memo is the latest directive in the Trump administration's campaign to dramatically reshape the federal government, the nation's largest employer.
In a blizzard of executive actions, the new president has shuttered all diversity programs, imposed a hiring freeze, sent national security officials home and sought to strip away job protections from thousands of civil servants.
The spending freeze ordered by OMB takes effect at 5 p.m. ET (2200 GMT) on Tuesday. Agencies have until Feb. 10 to submit detailed information on any programs subject to the suspension.
The federal government provides money to a broad swath of nonprofits, many of which reacted with dismay.
"From pausing research on cures for childhood cancer to halting food assistance, safety from domestic violence, and closing suicide hotlines, the impact of even a short pause in funding could be devastating and cost lives," Diane Yentel, president & CEO of the National Council of Nonprofits, said in a statement.
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