Evidence of meeting #42 for Government Operations and Estimates in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was estimates.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Peter Dobell  Founding Director, The Parliamentary Centre, As an Individual
  • Martin Ulrich  Independant Consultant, As an Individual
  • Peter DeVries  Consultant, Budgetary Affairs, 3D Policy, As an Individual

4:30 p.m.

Conservative

Scott Armstrong Cumberland—Colchester—Musquodoboit Valley, NS

Just really quickly, do you have any other ideas of how we can depoliticize the estimates and supply system that we currently have?

4:30 p.m.

Founding Director, The Parliamentary Centre, As an Individual

Peter Dobell

Not anymore than I've already suggested....

4:30 p.m.

Conservative

Scott Armstrong Cumberland—Colchester—Musquodoboit Valley, NS

Okay. Thank you very much.

Thank you Mr. Chair.

May 2nd, 2012 / 4:30 p.m.

NDP

Pat Martin Winnipeg Centre, MB

Thank you Scott.

That concludes one full round and that pretty much wraps up our hour. I want to thank both of our guests, Mr. Peter Dobell and Mr. Martin Ulrich, for sharing their views with us. The papers that you have published will be of use to this committee and form part of the body of research that we're doing.

Let me also say you made reference a couple of times to what John Williams had done in his years here in terms of scrutiny and oversight. Later today will be the founding of the Canadian chapter of the global organization of parliamentarians against corruption, CANPAC. Even though it started here, it's a lot more robust elsewhere in the world currently, and we're trying to reconstitute it here in this country. So it's at 6 p.m. today in room 340-S of Centre Block. All current and former MPs and Senators are welcome. I think it would be a very worthwhile thing for all of us on this committee to belong to. It has such an overlapping interest of making robust oversight and scrutiny part of parliamentary democracy.

Thank you so much for your time, gentlemen. It's a great pleasure to have you here. We will certainly benefit from what you've shared with us today. Thank you.

4:30 p.m.

Founding Director, The Parliamentary Centre, As an Individual

Peter Dobell

What we're looking for is your report, having a good report.

4:30 p.m.

NDP

The Chair Pat Martin

That sounds like a challenge and we will try to rise to it.

We will suspend the meeting briefly while we change our witnesses.

The meeting is hereby suspended.

4:35 p.m.

NDP

The Chair Pat Martin

Ladies and gentlemen, we will reconvene the meeting and welcome as our next guest and witness Mr. Peter DeVries, an expert in public management issues with a long and storied history with the Department of Finance. He has a great deal of experience in these matters. We welcome you here, Mr. DeVries. You have five or ten minutes or as long as you see fit to give us a presentation and then we'll look forward to questions.

The floor is yours.

4:35 p.m.

Peter DeVries Consultant, Budgetary Affairs, 3D Policy, As an Individual

Thank you Mr. Chairman.

I don't propose to go through my opening remarks, per se, but instead will summarize them and hopefully within the next five minutes.

At one time, when I was working at the Department of Finance back in the early 1980s, the estimates were a fundamental input in setting the expenditure framework contained in the budget. Officials from the Department of Finance and from the Treasury Board Secretariat would spend weeks compiling the individual expenditure forecasts for the departments and agencies, and then roll them up into an envelope-type of system, which then would form the basis of the direct program spending that was contained in the budget.

However, the budget and the audited financial statements, which sort of relay how well the budget did, evolved over time. All activities controlled by the government are included, cash accounting was replaced by accrual accounting, and the expense figures and revenues are presented now on a gross basis, rather than a net basis.

The estimates, however, have remained relatively static. Today, the estimates are largely irrelevant for budget planning. I believe that the budget should be the anchor for the estimates. The estimates should be put on the same basis as the budget and the audited financial statements, and they should be tabled after the budget.

Under the current supply processes, and with the fiscal year beginning on April 1, this would require that the budget be tabled no later than the middle of February.

Until recently, this was the practice, primarily based on a discussion paper that was released by the department in 1984. At that time we had the budget, we had a borrowing authority bill, we had projections of expenditures to the provinces, and we had the estimates. The budget sort of formed the basis for those three types of information, the estimates, the borrowing authority bill, and the transfers to the provinces.

Of course today, we don't have a borrowing authority bill anymore, so that reduces some of the importance of that linkage.

Tabling the budget before the estimates would mean that the estimates would be more in line with the budget. Reports on plans and priorities should be tabled with the estimates, incorporating the impact of the initiatives proposed in the budget. If that's impossible to do, there should at least be a full reconciliation of those things that were included in the budget but not included in the estimates.

Parliamentarians would then have a much more comprehensive picture on proposed spending by department for the upcoming year. Based on current reports, detailed information on the impact of the spending cuts proposed in budget 2012 will not be fully available until some time in 2013, and the reports on plans and priorities, which normally should have been tabled shortly after the estimates are now not expected until some time in May, and will not incorporate these changes.

One has to ask themselves, what is the use of the reports on plans and priorities, especially in this round?

There should also, as I mentioned, be a detailed reconciliation between the budget and the estimates. They will never be on the same basis. There will always be some differences, but there should be a full reconciliation of that difference. The last time there was a reconciliation between the budget and the estimates was in budget 2007, whereby the expenditure numbers, the expense numbers in the budget, were fully reconciled to the expenditure numbers in the main estimates.

We haven't seen that since.

If the estimates are to remain as is, then I believe they should be tabled much earlier in the process, say, for example, November. There is no reason why not, if they're not going to be tabled, or they're not going to be based on the budget estimates, and they're not going to be consistent with the budget accounting on a conceptual basis.

In that time, that would give parliamentarians much more time to assess the estimates and get them passed before April 1.

The estimates, in my view, then should only contain voted expenditures. Statutory expenditures should not be included. They're not being voted on. They're good for information purposes, but at the end of the day parliamentarians do not spend a lot of time on statutory programs unless there are proposed changes to those statutory programs, as we saw in budget 2012.

Statutory programs need a basis to be included anywhere. They need an economic context and unless you're tabling with the budget, I see no reason why these estimates should contain statutory spending.

With respect to the Parliamentary Budget Office, I believe it should be made an agent of Parliament, as it was originally promised, with increased resources and much more access to information.

Now, last week the PBO published a report entitled “Budget and Expenditure Reporting to Parliament: Strengthening Transparency and Oversight in an Era of Fiscal Consolidation”. I would recommend that this committee seriously consider the recommendations in that report.

I think it does go a long way to help focus what type of information should be obtained and how that information could be used.

That concludes my opening remarks. I would be pleased to answer questions the committee may have.

Thank you, Mr. Chairman.

4:40 p.m.

NDP

The Chair Pat Martin

You've packed a great deal of information into a very short presentation, Mr. DeVries. Thank you very much.

4:40 p.m.

Consultant, Budgetary Affairs, 3D Policy, As an Individual

Peter DeVries

I wasn't going to read through all that.

4:40 p.m.

NDP

The Chair Pat Martin

That's very helpful, thank you.

We're going to begin with the official opposition, the New Democratic Party, Linda Duncan. You have five minutes, Linda.

4:40 p.m.

NDP

Linda Duncan Edmonton—Strathcona, AB

Thank you very much, Mr. Chair.

Welcome to the committee. I was trying to speed-read your presentation. You did a very good job of speed presenting. It was a fabulous presentation, and a good number of your recommendations seem to be in keeping with those of all the other experts who have come before us, including the PBO.

What mechanism would you recommend be in place to require the government to be fully disclosing the information to the PBO and in a timely fashion?

4:40 p.m.

Consultant, Budgetary Affairs, 3D Policy, As an Individual

Peter DeVries

I think that if the PBO were made an agent of Parliament, then the rules with respect to the passing on of information should be the same as the other agents of Parliament, such as the OAG. If the rules and regulations with regard to the Office of the Auditor General are sufficient, and I believe they do go a long way, then those should be the same types of rules that the PBO should have.

4:45 p.m.

NDP

Linda Duncan Edmonton—Strathcona, AB

These are good points.

I'm trying to remember the PBO's report. As I recall, one of the things he pointed out was that Treasury Board already gets access, has all the detailed information online, I think it's from the estimates. He recommended there doesn't seem to be any reason why that information can't be made available to members of Parliament. I wonder if you could comment on that.

4:45 p.m.

Consultant, Budgetary Affairs, 3D Policy, As an Individual

Peter DeVries

It is true, all the information is online. Departments submit their detailed information as to what they are proposing to spend to Treasury Board for review and approval as the first stage of the estimates process. That usually starts in the spring of each year for the next fiscal year. All that is now passed through using computers, so it is there. As I said, even back in 1984, we used to go through detailed printouts. All that information was online. So there's no reason why, subject to some confidentiality requirements that may be considered too sensitive at a particular point, that the PBO or this committee shouldn't be allowed access.