To date there have been no cases of porcine epidemic diarrhea, known as PED, in Saskatchewan.
But confirmed cases of the highly contagious virus have been found in Ontario, Manitoba, Quebec and Prince Edward Island.
The government money is to be used to help pay for a PED strategy for Saskatchewan, including containment and a plan on what to do if it is discovered in the province.
Since the virus was detected in the U.S. last May it has killed millions of baby pigs in more than 20 states.
Saskatchewan currently has 119 active producers raising 91,900 sows that produce about 2.2 million market hogs.
Federal Agriculture Minister Gerry Ritz said vigilance is the key to reducing the effect of the disease on Canadian agriculture and the economy.
"This investment will help the Saskatchewan pork industry take proactive measures to stay in front of this disease,” Ritz said Thursday in a release.
The virus is unique to pigs and is not a threat to people.
The government money is being matched by Sask Pork, which represents producers.
Saskatchewan Agriculture Minister Lyle Stewart said the province has made PED a notifiable disease, which means producers must report it if it shows up on a farm.
Stewart said the province already funds programs to help producers keep their farms free of diseases, including some veterinary services.
The government is also spending money to bolster surveillance at high-risk sites including assembly yards, abattoirs, renderers and truck facilities.
Last week Manitoba's veterinary office reported that more pigs in the province have tested positive for PED, but the animals were in transit, not on a farm.