Finance Committee on May 5th, 2009

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Thank you.

[The Chair, Conservative, James Rajotte]

Merci.

Mr. Wallace, please.

[Mike Wallace, Conservative, Burlington, ON]

Thank you, Mr. Chair.

Thank you for coming this morning. I have a variety of questions and I may actually get more than one slot to ask them.

I'm going to start with Finance first. Some of the questions are a little bit broad in nature. I have my estimates from the three years now that I've been on the committee and I have all three books. There have been some changes. I just want to give you an example. In the main estimates for fiscal equalization payments, since the first time we had it, it has gone from $11 billion or so, in that range, to a little over $16 billion, which is a 42% increase.

Here's my question to you. It's great that I get these estimates, and they are called estimates. It's basically the budget. It's the planned spending, if I understand it correctly. How come I never see any actuals? Where would a member of Parliament actually see the actuals? I'm assuming what we say we're going to pay the provinces we're paying them, so that 42% over the last three years has gone out. There may be line items we might not have, so where do I find those actuals, and why are they not presented in the budget documents?

[Sherry Harrison]

In the fall, the departmental performance report is tabled, which would have information on the actual cost of the prior fiscal year. As well, the Public Accounts of Canada are similarly tabled in the fall and relate to the prior fiscal year expenditures.

[Paul Rochon]

The public accounts will provide you with a reconciliation of amounts that have been requested in the main estimates versus what was actually spent.

[Mike Wallace, Conservative, Burlington, ON]

That goes through Treasury Board. Does it come to these committees directly?

[Paul Rochon]

No, it is tabled in the House of Commons by the President of the Treasury Board .

[Mike Wallace, Conservative, Burlington, ON]

For us to make a change, because I'm just looking for improvements.... You'd be willing to come back to talk about what we actually said we were going to spend and what we are actually spending, and that would happen late in the fall. Is that correct?

[Paul Rochon]

That's correct. It would be once we actually know what we've spent and once the amounts have been audited by the Auditor General.

[Mike Wallace, Conservative, Burlington, ON]

One thing we are always nervous about around here, which is something I hadn't experienced before, is that you get three other chances to come back and ask for more money. The finance department doesn't do it as extensively as some other departments, in my view.

What are we expecting, based on the economic action plan that's been passed, which is not in these documents since these documents were prepared last fall? What are we expecting from the Department of Finance that was in the economic action plan and is not in the main estimates but should be in the supplementary estimates?

[Paul Rochon]

Within the department, we don't think there's anything significant. There may be an odd adjustment related to the extraordinary financing framework to the extent that we need operating expenses.

[Mike Wallace, Conservative, Burlington, ON]

Okay. I have another question for you.

[Paul Rochon]

Government-wide, though, this fiscal year will be somewhat exceptional. First, within the main estimates, there are about 35, as you all know. Treasury Board Secretariat is planning to table an early supplementary estimate to obtain appropriation authority for the full range of budget items that have not already been appropriated or legislated under separate legislation.

[Sherry Harrison]

If I may add, we'll also use the supplementary estimates process, as required, to update the statutory forecast information. Those are the items that have been approved through enabling legislation. So where there's material forecast change from the previous main estimates, we'll update that in supplementary estimates, as well.

[Mike Wallace, Conservative, Burlington, ON]

Okay. I had an opportunity when I first got here to be on the Standing Committee on Government Operations and Estimates, and there was an over and under report. I think the number was $25 million over and under. Then you had to report it. Is that only reported to government operations, or is there a reason we don't see at each committee how each department is doing, plus or minus, on their estimates?

[Sherry Harrison]

The departmental performance report that I referred to, which is tabled in the fall, will provide the estimates funding, which is the mains, plus the various supplementary estimates, or received funding, against the actuals, with a narrative explanation of the changes. As I said, that's tabled for all departments by the President of the Treasury Board late in the fall.

[Mike Wallace, Conservative, Burlington, ON]

From an accountability point of view, I like the estimates meetings. Some aren't as keen on them as I am, but I think we should have you back to talk about the report that comes out and about how much we actually spent.

You were giving an answer on the waterfront revitalization issue.

Just out of interest, if I look at the grants under “Compensation to Canadian agencies or entities established by an Act of Parliament for reduction of debts of debtor countries”, that has varied considerably over the last three years in terms of the amount of money. Can you explain to me why that is?

[Paul Rochon]

I'll let my colleague Jim Haley provide more details. Effectively, these are payments we make intermittently to international organizations. They aren't annual payments.

Jim, I'll leave you to expand on that.

[Jim Haley, General Director, International Trade and Finance Branch, Department of Finance]

That's correct, Paul. These debt forgivenesses are granted under various international agreements, including the HIPC Initiative. Under the HIPC Initiative, a debtor country will enter into an agreement with the IMF to undertake a series of economic reforms. The reforms are essentially policy measures that ensure that when we provide debt relief, the benefit of that debt relief goes to the people. It will essentially create the conditions for strong growth. Depending on where any particular country is in its HIPC program, it may or may not be getting debt relief.

[Mike Wallace, Conservative, Burlington, ON]

How far in advance can you budget for this?

[The Chair, Conservative, James Rajotte]

This is your last question on this.

[Mike Wallace, Conservative, Burlington, ON]

In terms of budgeting, since it varies considerably from year to year, how far in advance do you know how much we are going to be paying?

[Jim Haley]

We essentially take a fairly optimistic approach to this in the sense that we assume that the country will meet all of the HIPC critical points in terms of its performance. If a county doesn't meet that key condition or that key criterion, then it doesn't get the debt relief and so our numbers will change. I should also note that the numbers fluctuate as some countries complete their HIPC process and the debt is written off. For example, last year Iraq completed its HIPC process, so we had a large debt forgiveness last year, but we don't have anything for Iraq this year.

[Mike Wallace, Conservative, Burlington, ON]

I appreciate that. Thank you very much.

[The Chair, Conservative, James Rajotte]

Thank you.

Monsieur Mulcair, s'il vous plaît.