Thank you.
I believe that you all have a copy of my short deck, which I will go through.
Please turn to page 2, which is basically the table of contents. The goal of the presentation today is to provide you with the various views of the 2010-11 main estimates and the various breakdowns. Also, I will provide some explanation on the variance we see between the 2009-10 main estimates and our 2010-11 main estimates.
What you see here, basically, is a high-level picture of our 2010-11 main estimates compared with the 2009-10 main estimates. As you can see, our main estimates for 2010-11 are close to $2 billion--$1.967 billion--compared to our main estimates for 2009-10, which were approximately $1.6 billion.
This view, as you can see, is broken down into what we call votes, which are basically our major buckets of money or types of expenditures. Vote 1 is operating expenditures, which includes our personnel salary expenditures. Then there are capital expenditures and our grants and contribution expenses.
You can also note that we have an increase of $326 million. As I said, I will provide a little bit more detail on that later in the presentation. As you will also note, over 90% of this increase is basically tagged to vote 1, which is operating expenses, and to major capital expenses.
Page 4 provides a different view of our main estimates. What you see here is basically the $1.967 billion divided and spread out over program activities. Note here that our vote 1 operating expenditures are actually split between the personnel perspective, meaning our salary costs, and other operating expenditures. I'd like to make the point that basically, if you take a look at it, 58% of our operating expenses are dedicated mainly to salary costs. If you add the statutory portion--our employee benefits plan--of $127 million, what we come out with is 70% of our real, true operational costs being dedicated to personnel expenses.
As for the increase of $326 million, you can see that close to 80% of this increase is tagged to Canadian Coast Guard program activity and small craft harbours program activity. I have in the annex a further breakdown of that $326 million increase.
I thought it would be important to touch on the budget 2009 money we received for our economic action plan projects. It was important, because we received a considerable amount of money last year--close to $450 million--through budget 2009 for this purpose. And $217 million, which is part of our main estimates this year, is one of the reasons for the variance of $326 million.
I'd like to make the point that when I say the increase was $326 million, it's not necessarily an increase to our budget from 2009-10 to 2010-11. This is the variance between what we call the 2009-10 main estimates and the 2010-11 main estimates. For example, last year, of the money earmarked for us as part of budget 2009, we actually got and spent over $200 million of it as part of our 2009-10 fiscal year, but due to timing issues, it did not appear in our 2009-10 main estimates.
The budget comes in basically in the spring and the main estimates are already tabled by that time. Through the supplementary estimates process--through supplementary estimates (A), (B), and (C)--we then access the funding for that particular year. We also include, as part of the annual reference level in the process, the amount of money for the incoming year, which then makes it to our main estimates.
What I am telling you is that our total budget last year, including what was accessed through supplementary estimates and the total spent, was in the neighbourhood of $2 billion. We're still projecting approximately $2 billion in spending for this fiscal year. Again, we have some money tagged in budget 2010. This money is not showing, obviously, in the 2010-11 main estimates you're seeing here; we will access these funds as part of the supplementary estimates process.
Also, as you know, in budget 2010 there was a restraint measure, with a freeze on operational funding. These funds will be clawed back by Treasury Board, so to speak, through the supplementary estimates process. They do form part of our main estimates, but will be returned to the centre as part of the supplementaries process.
So again here, as part of that $217 million that makes up the $326 million increase compared to last year's main estimates, we have close to $100 million that is dedicated to the second year of the small craft harbours infrastructure repair and maintenance program. It will go towards that.
The Canadian Coast Guard will actually receive $175 million for both years: $90 million went to year one and $85 million is tagged for year two. It's the portion dedicated to vessel procurement, life extensions, and refits.
We have close to $25 million for federal laboratories and $8.6 million for the contaminated sites action plan.
We also got money for the Pangnirtung harbour construction of which money has already been accessed for 2009-10 and used for that construction. Part of the money that's earmarked in our 2010-11 is $1.8 million at this time, but we still have a little money to be accessed through 2010-11 through the supplementaries process for the completion of that construction project.
Basically, that's a little detail on the economic action plan funding that we received.
If we flip to page six, I'm not going to dwell on this page, as it's basically the same information that you saw in a different format on page four. The pie chart shows the breakdown of our main estimates, again by program activity. You will note that the larger part of our program spending obviously goes to Canadian Coast Guard program activity, fisheries and aquaculture management program activity, and science activities.
On page seven, we're giving you a slightly different view. It's another pie chart of our budget, broken down by organizational structure in the department, basically the different sectors that we have, including the coast guard. There's additional information here. On the previous page, you saw by program activity that 18% of our budget is dedicated to what we call internal services. On this page, you can actually see the breakdown of that 18% and what the internal services are made of.
It basically shows the sectors for chief financial officer, HR, strategic policy, communications, executive direction, and legal services. A large part of the internal services are actually the real property services, which are included in the 21.4% that you see under infrastructure and information management. Also included in that is the IM-IT spent.
As we move to page eight, I promise you that this is the last pie chart you're going to see today. This pie chart actually gives you a breakdown, again, of our main estimates. It gives you the regional perspective and shows how the money is disbursed throughout Canada. The important point to make here is that, as you can see, as part of our main estimates process, a large part of the money is earmarked for what we call national programs.
Through our budget allocation process, as we're actually going through right now, this money is distributed throughout the regions, excluding the national capital region. The larger part of that national program money included there is real property activities. We have the aboriginal contribution programs that are also included in that. So through a process where there's an analysis of the projected investments on the capital front, for example, based on our investment planning and long-term capital plans, we then distribute this money. As I said, it's part of the initial budget allocations of the department. The money is then distributed to the regions.
I'd like to finish off now. Again, I'm not going to through all the details. I have two sets of annexes. Annex A gives a complete listing of what makes up the $326 million variance. I'd again like to point out this is a variance, not necessarily a budget increase.
I'm not going to go through all of them. I basically went through the major ones, which are linked to the economic action plan funding that we received in the second year. On other important items that make up the $326 million are adjustments to our compensation resulting from collective agreements.
We then have $32.5 million, as you can see, related to what we call the re-profile of funding for the midshore vessels project. This is not new money coming in. This is departments adjusting their spending pattern for money we already received. It is in our budget and in previous budgets.
For example, if you receive $100 million over five years and the initial earmarked amount of that funding is $20 million a year for the next five years, as you deliver that project you can adjust your spending pattern, depending on the environment--for example, how construction is going.
Through what we call the annual reference level update process, we can tweak how we spend this money. If we come to the conclusion in year two that we're going to spend $10 million instead of $20 million, and $30 million in year three, we adjust that spending. That creates a variance in the main estimates. So this is not new money, exactly; the budget envelope for this money remains the same. It's just distributed differently based on our spending pattern, which can change over the year.
Another important point to make is that in part of the $326 million is one of our contribution programs, the lobster sustainability program, at $14.9 million. Again, that program was initiated in fiscal year 2009-10, so we accessed the first year of funding through the supplementary estimates process in the last fiscal year. That is why it did not show up in the 2009-10 main estimates. The second-year funding earmarked for that now shows up in the 2010-11 main estimates.
I'm not going to go through everything. If you have questions on any of the other items that created the variance, I'd be more than happy to answer them.
As you can see on page 11, obviously the $326 million is a net amount, so there have been increases and decreases. This shows a list of the main ones. Some of the money we got has been re-profiled in delivering certain of these projects.
If you take a look, you'll see the key items. The $8.4 million at the bottom is basically a re-profiling of the money we received to implement an automatic identification system. That's a marine traffic monitoring system. There's $7.1 million related to the construction of St. Andrews biological station.
Again, money was simply re-profiled from year to year, and spending was advanced in 2009-10 rather than 2010-11. We have $4 million that was sunsetting in one of our programs, the invasive alien species strategy, and that money for budget 2010 was reintroduced to DFO. That $4 million was sunsetting, so it created a variance. That money is still not part of our 2010-11 budget. Because it was part of budget 2010, we're going to re-access this money through the supplementary estimates process through the course of the year.
I'd like to finish off with page 12. It gives you a quick view of the transfer payments for grants and contributions. The changes in funding that you see from 2009-10 to 2010-11 are mainly due to timing issues and not necessarily to changes in our actual authorities for these programs through increases or decreases.
The only one that could be considered a modification to our authorities in the last couple of years is the $14 million for the Atlantic lobster sustainability measure, which I talked about in the overall modifications. That makes up most of the variance, to bring our total programs to $129 million.
That concludes my presentation. Thank you very much.
