Government Operations committee  Yes, for the most part. One of the important rationales behind that is that this is not federal infrastructure; it tends to be provincial or municipal.

Government Operations committee  Yes, the funding for the program is being increased. I don't have the numbers right in front of me, but as I recall, it is by about $150 million a year over two years. It is probably worth pointing out that one can claim both the renovation tax credit and make use of this program at the same time, so they are complementary.

Government Operations committee  That program is managed by Canada Health Infoway, which is a federal-provincial organization. My understanding is that effectively, Ontario, in particular, has not had as large a take-up as other provinces, but I understand they are in the process of doing so. Infoway publishes regular reports, annual reports.

Government Operations committee  You're correct, for the most part. Past and current infrastructure programs require some funding, but not entirely. For example, the gas tax transfer is not shared or matched, if you will, and that hasn't been changed at all.

Government Operations committee  I can answer. As to the provinces' budgetary position, they have a lower level of debt than the federal government.

Government Operations committee  I do not have those figures at hand, but I think that if we looked at the municipalities' debt levels, it is not very high, because, you are right, they can only borrow for capital projects. If you take provinces and municipalities together, their debt level is lower than the federal government.

Government Operations committee  With respect to new spending in the 2009 budget, that is correct.

Government Operations committee  Of the 1.9%, 1.5% is federal only and the remainder is a provincial top-up. So 1.5% is federal only, in the first year, and the remainder is an assumed matching from provinces. I point out in that regard that Canada is fairly unique among major industrialized countries in that it's the only country where, effectively, the government sector at the federal level only accounts for half of the total government sector.

Government Operations committee  The Minister of Finance would be involved in a significant way, clearly, in those reports. The budget itself presents a preliminary estimate of the employment impacts based on a modelling approach. We would expect, as the measures are implemented and put into effect, that we would in fact have what I might describe as hard estimates, in the sense of actual estimates of employment and output impacts by measure.

Government Operations committee  We have to understand what is really spent, those are the most important amounts in the two years. For example, the money the workers receive is based on cash accounting, not on accrual accounting.

Government Operations committee  The difference lies in the fact that, in one case, figures are given on a cash accounting basis, that is the amounts that are actually spent during the year. Those amounts are higher. Table 3.7 shows the amounts on an accrual accounting basis. That shows the amortized costs of the infrastructure investments.

Government Operations committee  Essentially, cash accounting shows the real amounts spent in a year. Let us suppose that the government spends $100 million to build a building and construction takes two years. Using cash accounting, the $100 million would be shown as a cost in those two years. In accrual accounting, you have to show the amortized amount.

Public Accounts committee  I think probably the most straightforward or simplest way to express the flexibility would be to think of an average effective interest rate on debt charges, with one proviso of about 5%. So, more or less, with debt reduction in the order of $100 billion, if the debt had been higher by $100 billion currently, the government would be paying about $5 billion more in debt charges.

Public Accounts committee  It is true that over the same period the debt has been reduced, interest rates have come down. To throw out a number to put that in context, in 1996 debt charges represented roughly 30% of revenues; they're down to something like 14%. Now that we're in an era of lower interest rates, it would be natural that the reduction in that ratio would taper off somewhat.

Public Accounts committee  There's no international standard that I'm aware of. In fact, I think it would depend on the country-specific circumstances. Tim O'Neill did a review of the Department of Finance's forecasting practices about two years ago. In that report there was an estimate done for Mr. O'Neill by the University of Toronto that to provide an assurance of staying out of deficit, in each and every year one would need to target a surplus in the order of $6 billion to $10 billion.