Government Operations Committee on Oct. 30th, 2012

[The Chair, NDP, Pat Martin]

I call the meeting to order.

Good morning, ladies and gentlemen. I'm happy to welcome you to the 60th meeting of the Standing Committee on Government Operations and Estimates.

Today we've invited representatives from the Treasury Board Secretariat and the Department of Finance. We are going to try to understand the government's response to our seventh report, which was entitled “Strengthening Parliamentary Scrutiny of Estimates and Supply”.

We have, from Treasury Board Secretariat, Ms. Sally Thornton, the executive director, expenditure operations and estimates; Mr. Bill Matthews, the assistant secretary, expenditure management sector; and Mr. Kenneth Wheat, the senior director of estimates, expenditure management sector. Welcome.

Representing the Department of Finance, we have Mr. Douglas Nevison, economic and fiscal policy branch; Mr. Frank Des Rosiers, general director of analysis, tax policy branch; and Mr. Brian Pagan, director, fiscal policy, director's office. Welcome.

I understand that there will be a lead from each of the departments. We have until about 10:30 with you as witnesses today. If you could, please give us an opening statement and leave lots of room for questions.

Go ahead, Mr. Matthews.

[Bill Matthews, Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat]

Thank you, Mr. Chair.

As you mentioned already, I am here with a few colleagues to answer any questions related to the government response to the recommendations in the committee's seventh report.

As you know, the report contains 16 recommendations. Of the 16 recommendations, some are directed to standing committees of the House of Commons. Others are directed at TBS and finance. Between the two departments, the 16 recommendations that apply to us are recommendations 1, 2, 4, 5, 6, 7, and 16. The balance of the recommendations apply to standing committees.

We're happy to offer commentary, but the actual focus of the government response is on the recommendations directed at either TBS or finance. Between the two departments, we will do our best to respond to your questions. I'll leave it at that, and we'll get straight to the questions.

Thank you.

[The Chair, NDP, Pat Martin]

Thank you very much, Mr. Matthews. That is probably a good idea.

Who would like to speak for the Department of Finance?

[Douglas Nevison, General Director, Economic and Fiscal Policy Branch, Department of Finance]

Thank you, Mr. Chair. I think in the spirit of your request that we leave as much time as possible for questions, we'll leave it with Bill's opening remarks.

[The Chair, NDP, Pat Martin]

Very good. Thank you, Mr. Nevison.

Having said that, then, we probably will go directly into questions. The clerk has an order of precedence, I suppose. Normally we begin with the official opposition. I believe that Mr. Denis Blanchette will be first.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Thank you, Mr. Chair.

My thanks to our guests for joining us this morning.

When we looked at all your answers, we were surprised. Let me remind you what our objective was; we wanted to make the estimates easier to understand, especially for those who pass them, meaning the members of Parliament. If you want to have some fun, go see the MPs in any committee trying to read the estimates. They are quite confused. I personally am not convinced that your answers will make them more comprehensible, even if they will deal a bit more with programs.

Could each of you tell me what concrete actions will be taken to make the estimates a lot clearer, as the committee wishes? As of today, what are your departments going to do?

[Bill Matthews]

Thank you, Mr. Chair.

I think perhaps the best approach is to take it recommendation by recommendation, because it's hard to generalize what actions we will take. I will quickly run through the recommendations and the government response. I will turn to my colleagues from the Department of Finance for comments on a few of them.

The first recommendation related to the long-standing question of whether to adopt accrual appropriations. The recommendation from the committee was that the government complete its study and get back to the committee by March 31. We indicated in the response that the government would do just that. There will be a response back to the committee by March 31 on what the government feels is the most appropriate model for appropriations accrual or cash-based. That commitment hasn't changed.

The second recommendation is the most challenging one, I think. It's on the vote structure in terms of how information is presented to Parliament. The question is how to best present the vote information to Parliament in appropriation acts. The fundamental question is whether to have the current structure of capital operating grants and contributions or a program- and activity-based model.

What the government has committed to do on that front, because this would be a significant effort to undertake and we wanted to ensure that members really had a sense of what they were getting, is to actually pursue a mock-up of what a vote structure would look like on that front and present it to committee. It would be unfortunate to undertake significant work and significant investment, only to find out at the end of the day that it's not what parliamentarians had in mind, so there is a commitment to come back with mock-ups. We will do that fairly shortly and have that discussion.

[Denis Blanchette, NDP, Louis-Hébert, QC]

You are talking about a mock-up of a vote structure. We are later going to introduce a motion on pensions. We are planning to study the pension model. You will soon have to manage two pension groups. You will need to make changes in your books to deal with that.

I would like to know what kind of transformation, or rather efforts, you will need to make. In terms of the vote structure, you said that you will need to make efforts, that you were going to show us a mock-up, and so on. What are the efforts all about?

[Bill Matthews]

What you would see if the proposed idea is followed through is a structure based on the current program's activities. Each department has programs and activities. The proposed idea would be to present a potential option for voting funding by information along the program activity lines. That's what we've put on the table.

Recommendation 4 is for information on reports on plans and priorities three years forward, and three years backwards for expenditures. The government has agreed to accept that recommendation.

Recommendation 5 is for variance analysis being included in the reports on plans and priorities. The government has agreed with that recommendation.

Recommendation 6 relates to the budget and the notion of a fixed budget date. I'll turn to my colleagues from finance for a quick comment on recommendation 6.

[Douglas Nevison]

Sure.

As you know, the government did not support the recommendation to have a fixed date for the budget. It does support the objective that you mentioned in terms of trying to improve the understanding of the main estimates. I think that through other vehicles, such as committee appearances and our own documentation, we'll continue to make strides to help improve the understanding of how the budget and the main estimates are linked.

Thank you.

[Bill Matthews]

Recommendation 7—

[Denis Blanchette, NDP, Louis-Hébert, QC]

I understand that you did not necessarily want to have a fixed date, but I would like you to tell me a bit more about the link between the budget and the departmental reports on plans and priorities. In our study, we noticed that the longer the period between the publication of the figures and the publication of the departmental reports on plans and priorities, the less relevant the exercise was.

I would like the delay to be shorter or non-existent, so that this important exercise is once again useful for departments.

[The Chair, NDP, Pat Martin]

Give a very brief answer, please. You're well over time.

[Bill Matthews]

If I may offer a quick comment, recommendation 7 actually gets to that comment. It does speak to new funding in estimates appearing for the first time, and there's a commitment to cross-reference that to the appropriate budget.

Maybe I'll cut it off there, Mr. Chair.

[The Chair, NDP, Pat Martin]

Yes. Maybe we can get back to that in future questioning.

Next, for the Conservatives, we have Mike Wallace.

[Mike Wallace, Conservative, Burlington, ON]

Thank you, Mr. Chair.

I thank our guests for coming.

I know that you had valuable input for us during the study we did during the spring. We appreciate your coming back to discuss some of the recommendations and the response from the government.

I'm going to focus a little bit on what I find is the important one. That's dealing with the program review over the gross numbers, or however you want to call it, in terms of the votes that you have now. When you came to see us, you talked about a crosswalk or a bridge of sorts for that. Are you still planning on being able to provide that? Is that what you're calling the mock-up, or is the mock-up in addition to that?

[Bill Matthews]

In the mock-up that we would present, we would take the estimates from last year for two departments and present them on alternative basis, which would be a program activity basis, and have that discussion. The crosswalk on how you get to budget is a separate item.

Recommendation 16 also gets to that issue, because it talks about a database that would be queryable. That might be something that would help, but the actual crosswalk to budget largely depends on timing.

Is there anything you want to add on that?

[Douglas Nevison]

As I think we mentioned the last time, it's something we could look at in terms of trying to improve that link between the two. It wasn't part of the official recommendations, but as I said, there's ongoing work between us to try to bring the two documents closer together so that people can work from one to the other and have a better understanding of how they work together.

[Mike Wallace, Conservative, Burlington, ON]

You're saying that for our understanding, we'll use last year's numbers and we'll look at the estimates process we had last year for a couple of departments, and then you're going to provide us with what it could look like if it were in the program format. When do you expect that to happen?

[Bill Matthews]

It's a fairly substantial amount of work on our part, but we would like to have that presented to you for discussion before the House rises for Christmas.

[Mike Wallace, Conservative, Burlington, ON]

You want it back at this committee before Christmas?

[Bill Matthews]

Ideally, yes.

[Mike Wallace, Conservative, Burlington, ON]

We don't have you on the schedule, so we'll have to squeeze you in.

[Bill Matthews]

We have to do some work on our end as well.

[Mike Wallace, Conservative, Burlington, ON]

Okay.

Who is picking the departments?