Evidence of meeting #78 for Finance in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was debt.
A recording is available from Parliament.
Senior Associate Deputy Minister, Department of Finance
We constantly evaluate the effectiveness of the coinage program. I would note for the committee's benefit that we still earn substantial seigniorage from the coinage program as a whole. There are no plans to eliminate the penny at this time.
Conservative
Mike Wallace Conservative Burlington, ON
No plans. Okay. Your position, as the finance department, is not a policy issue in that area, is that correct? Or is...?
If I as an individual member wanted to push the government to say maybe we should be reviewing the role of the penny in this country, would I do it through the Department of Finance? Or where is that policy decision going to be made? The Mint makes them--
Senior Associate Deputy Minister, Department of Finance
Yes, ultimately the Mint, I believe.
Senior Associate Deputy Minister, Department of Finance
Yes.
Oh, pardon me, it is the Department of Finance. We contract with the Mint.
Conservative
Senior Associate Deputy Minister, Department of Finance
We do not decide. The minister and the government decide.
Conservative
Mike Wallace Conservative Burlington, ON
On page 17, under “Tax Policy”, it shows 244 employees in 2007-08. It goes up by four and then goes down by one.
What are you doing there that's making that change? Are we adding something there or taking something away? I don't know how you're figuring these things out.
Senior Associate Deputy Minister, Department of Finance
If I may--this will get me in trouble--that's a rounding error, if you will. I mean, it's a steady-state number of employees, more vacancies in one year, and fewer projected for going forward. The right number is running at about 248. There is no substantial change in either the responsibilities or the level of effort within the tax policy branch as projected for next year.
Conservative
Senior Associate Deputy Minister, Department of Finance
No, no, they're precise. They're precise numbers.
Senior Associate Deputy Minister, Department of Finance
Yes. All I meant was that sometimes there is a shortfall in terms of vacancies. We are not growing the FTEs in the department, as you noted earlier.
Conservative
The Chair Conservative Brian Pallister
Yes, it is, Mr. Wallace. But those were good questions, considering your arrival time here.
We'll move now to our two final questioners. We'll begin with Madam Wasylycia-Leis.
NDP
Judy Wasylycia-Leis NDP Winnipeg North, MB
Thank you, Mr. Chairperson.
I would first like to ask how you as a department are going to address your inadequacies on fiscal forecasting. That still seems to be an ongoing problem. We've had this discussion many times at our committee.
Given the last budget, the last fiscal year, and the one we're in...or the last two years, we're about $22 billion out, according to my information. This has resulted, at least in this last fiscal year, in $9 billion going against the debt without discussion, without dialogue, without seeking input on priorities, as the government said they would do when they were in opposition.
What are you doing to address this problem?
Senior Associate Deputy Minister, Department of Finance
We have Paul Rochon, as the acting deputy minister of fiscal policy, to answer that.
Paul Rochon General Director, Economic and Fiscal Policy Branch, Department of Finance
I'll begin with the $9.2 billion surplus projected for the year that just ended, 2006-07. That's up from the fall update, but from a number that was $8 billion in the fall update. Now, the fall update number didn't include the full extent of the budget numbers, so if you added those in, that $8 billion in the fall update would have increased to something like $14 billion. That's outlined in the budget.
NDP
Judy Wasylycia-Leis NDP Winnipeg North, MB
About a year ago you were at $3.6 billion. In the update it went up to $8 billion, and we ended up with $14 billion. So quite a--
General Director, Economic and Fiscal Policy Branch, Department of Finance
That's correct. That reflects a couple of things. First of all, there is a rapid growth in personal income tax collections, which are growing roughly twice as fast as the underlying tax base. That is something we have been looking at and discussing for some time. We have made some adjustment in our assumptions going forward. The point I'd make is that this is not something that's unique to the federal government in Canada. Other countries around the world have experienced the same phenomenon.
As you know, we had a fairly lengthy report by Mr. O'Neill, who appeared before the committee. He made a number of recommendations. We continue to have dialogues with the private sector. We try to explain the risks, to the extent possible. But you have to understand that you are dealing with combined revenues and expenses of about $400 billion, so a small error on either side translates into a fairly significant change to the bottom line.
Fundamentally, what we're dealing with is how you manage that risk. Our approach is to try to be upfront and as transparent as possible on the nature of those risks.