Government Operations Committee on Oct. 30th, 2012

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

Can this crosswalk help us, for example, in the case of human resources programs or programs from any other department?

When a program is put in place, it is associated with a budget year. We launch the call for program proposals afterwards. The money is often spent in a subsequent year. We are always wondering whether the money comes from the current year or from the previous year. If what is left of this budget is saved, for example, for the year 2010, the remaining amounts are sometimes spent in 2012.

It is really complicated and difficult to follow. When we talk about a department in particular, this may work. However, when we are dealing with all the departments and we are trying to figure out where the funding for the programs comes from, it gets really complicated. Will this crosswalk going to shed some light for us, as managers?

[Bill Matthews]

Mr. Chair, I think there are three recommendations, maybe even four, that get to that question. These are the ones I would touch on. The response to recommendation 4 talks about showing planned spending in reports on plans and priorities three years backward, but more importantly, three years forward, so there's additional information there. Linked with that is the response to recommendation 5, whereby reports on plans and priorities are supposed to explain any variances that have occurred in the planning so that you'll be able to see if money has indeed moved from one year to the next fiscal year or if there's been a change in profile. The variance analysis would explain that.

Probably the most important of the three is recommendation 7, which is that the first time any new funding appears in an estimates document, it will be linked back to a particular budget so that members or parliamentarians can actually see, when funding shows up for the first time in an estimates document, which budget it came from. I think that's a critical link.

The last one, recommendation 16, which talks about a database that's searchable, would also be helpful to parliamentarians in addressing that recommendation as well.

[Jacques Gourde, Conservative, Lotbinière—Chutes-de-la-Chaudière, QC]

I am going to go back to my colleague Mr. Wallace's question about the tabling of the budget.

The committee was doing its work and might have liked the budget to be tabled a bit sooner. However, in your answer, you said that there were imperatives. You said that it is desirable for the government to still have a lot of flexibility in tabling the budget.

What are those imperatives that need to be kept in mind when tabling the budget?

[Douglas Nevison]

As I mentioned, the objective of the budget is to provide a five-year forward-looking economic and fiscal plan. In a situation like the one we are currently in or have been in for the past few years, in which the global and domestic economic situation is highly uncertain, there's a value to having flexibility to present that five-year plan with the most up-to-date information available.

From that perspective, for example, the last few budgets have tended to be in March. March gives you the advantage that, obviously, it's the last month before the next fiscal year, so it's before the five-year plan begins, but from a data perspective on the economic side, it means we get the fourth quarter of the previous year of national accounts, which tends to come out at the end of February, so we can incorporate the most up-to-date economic data into the forecast and get the private sector forecasters to base their forecast on that information.

On the fiscal side, with a March budget we have access to monthly fiscal data that's published in The Fiscal Monitor right up until January of the year, so for the current year we're in when we're forecasting, we have nine of 12 months in terms of fiscal developments. In that case, the government is in the position to present a well-informed economic and fiscal forecast to set the context for the fiscal plan going forward. I think that's one of the key aspects in terms of flexibility.

[The Chair, NDP, Pat Martin]

I'm afraid that concludes your time, Jacques. Thank you very much. I'm sorry.

Next, we have Lise St-Denis from the Liberal Party for five minutes.

[Lise St-Denis, Liberal, Saint-Maurice—Champlain, QC]

Good morning, everyone.

I am not an expert. I am just visiting. I am replacing Mr. McCallum, which is not easy, given that he is very well-versed in this area. But I am still going to ask you two questions.

In recommendation 16, the committee recommends that the government develop a searchable online database that contains information on departmental spending by type of expense and by program

When does the government intend to present a model to Parliament? What options is the government considering?

[Bill Matthews]

When we get to the point of actually producing a database, it would be all departments, so you would see government-wide information and then specific department-by-department information. This database would be all-encompassing for any department that's included in the estimates.

[Lise St-Denis, Liberal, Saint-Maurice—Champlain, QC]

Through supplementary estimates (A) 2012-2013, the Secretary of the Treasury Board requested funding of $4.6 million to strengthen the security of federal systems against cyber-attacks.

Could you tell me what amount has been requested for this purpose in supplementary estimates (B) 2012-2013 and how is this funding being used?

[Bill Matthews]

That question, Mr. Chairman, is more appropriate for officials who represent Treasury Board Secretariat as a department. I'm sorry, but I can't answer.

[Lise St-Denis, Liberal, Saint-Maurice—Champlain, QC]

You cannot say if that would be realistic.

Okay. So I will stop there.

[Bill Matthews]

Potentially, when you actually see public accounts in the upcoming weeks, you'll have a sense of what was actually spent by department, and that might be a better way to answer that question.

[Lise St-Denis, Liberal, Saint-Maurice—Champlain, QC]

Okay.

[The Chair, NDP, Pat Martin]

Thank you.

We will go to Kelly Block for the Conservatives.

You have five minutes, please, Kelly.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you very much, Mr. Chair.

Again, thank you to our witnesses for being here.

As I read the responses we received, I think I would characterize them as fair and consistent, given the various rationales regarding the jurisdictions of the various committees that provide oversight to some of these areas, and I think they would support many of our own observations as we were formulating the recommendations that we would include in this report. There were some assumptions that we were grappling with, and I think they've been confirmed for us in your responses.

I'm going to ask questions regarding two different recommendations. The first would be recommendation number 2. I know we've talked a little bit about this in terms of the crosswalk that we are going to be provided with.

I also read in there that the government agrees to include information on planned spending by program activity as well as by vote in applicable estimates.

Further along there's a commitment to conducting public consultations, or consultations. I'm wondering if you would be willing to talk a little bit about what kind of consultations with the public and stakeholders the government will undertake.

[Bill Matthews]

There are two parts to that question, Mr. Chair.

On the first part, this notion of the crosswalk has come up twice. I think there's maybe some confusion, because when the committee was first doing its study there was discussion about a crosswalk between estimates and the budget. There was no recommendation by the committee to actually build that crosswalk.

The crosswalk being referred to in recommendation 2 is around the appropriation structure currently in the program activity model. We're talking about the ability to actually understand what a new model might look like versus the old model.

I do want to be clear that there was no recommendation by the committee to build a crosswalk between the budget and the main estimates. I think that has come up in a couple of questions so far. I hopefully have added clarity on that front.

In regard to your second question, about the types of public consultations, we haven't quite determined that yet. The thought was that if we're fundamentally changing the way Parliament votes money, maybe there's a need to have some public consultations, but we haven't quite wrapped our minds around what that might look like.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Okay.

My second question would be in regard to recommendation number 12. That recommendation is for departments and agencies to include tax expenditures currently included in the Department of Finance's tax expenditures and evaluations.

I know that in your response you agree in principle with this recommendation and support the objective of facilitating access for members of Parliament to information on tax expenditures, but I want to give you an opportunity to expand on the tax expenditures and evaluations report and why you don't think it would work to incorporate it the way we had recommended.

[Frank Des Rosiers, General Director (Analysis), Tax Policy Branch, Department of Finance]

Thanks so much. Thanks for the question.

It's true that the government agrees in principle with that particular recommendation, very much in the spirit that you and other committee members have flagged the desire to have a broader picture of government activities.

The reservation that we've expressed is around the notion of ministerial accountability. At the end of the day the tax system, and tax expenditures in particular, are the responsibility of the Minister of Finance and of the Department of Finance. We think it would be problematic to include the actual tax expenditures in the DPRs and RPPs of individual departments, as those departments and ministers don't have the expertise, know-how, and responsibility to deal with those particular tax expenditures, whereas the Department of Finance does.

That's the gist of our response.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Okay.

[The Chair, NDP, Pat Martin]

You have one more minute if you'd like it, Kelly.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Given that explanation, if we were asking for the tax expenditures to be included more by way of report than in terms of asking the minister to account for them, would that still prove to be difficult, given the fact this is the Minister of Finance's responsibility?

[Frank Des Rosiers]

That's right, and this is the reason that we have suggested to introduce this link in every single departmental RPP so that they can actually have access to that broad picture of what's happening in terms of tax expenditures across government.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you.

[The Chair, NDP, Pat Martin]

Thank you, Kelly.

That concludes our first round, but I would ask the witnesses to flesh out an answer to questions put by both sides about the deadline, if not the fixed date, of February 1. The position of the government's response was that it did not support a fixed date, as it was called, because it would restrict the government's flexibility in responding to global and domestic imperatives.

Just what global and domestic imperatives would prevent the government from having a fixed budget date, and to what extent are other countries that have a fixed budget date limited in their ability to respond to domestic or international imperatives? What do you mean?

[Douglas Nevison]

From a policy perspective, for countries or provinces that have fixed dates, there's the opportunity to use economic statements and other vehicles if developments were to occur. For example, the global recession in 2008-09 was obviously an occasion when the government did make the decision to pull the budget forward—quite a bit forward—to January 27, 2009, which was the earliest tabling date in a number of years.

There are options there, but again the flexibility I'm talking about is often informational in terms of providing Canadians with the best information possible on the context for the government's five-year economic and fiscal plan. I think it's that type of flexibility as well. There is also, as I mentioned, the flexibility to respond if, for example, a global economic shock were to happen.

[The Chair, NDP, Pat Martin]

Exactly. That would be with an economic update or a fiscal update. The goal here is for Canadians to understand what the proposed spending is and what the proposed spending seeks to achieve, and that's done by examination of parliamentarians.