Thank you. I'd be happy to.
I would like to thank the honourable members of the committee for the opportunity to speak with you about strategic reviews.
Perhaps I could start briefly with the framework within which we're working. The expenditure management framework is a framework for developing and implementing the government's spending plans in support of its priorities. This framework was put in place in the budget of 2007.
In it we emphasized three key elements: managing for results, where departments are expected to manage their programs to achieve results and evaluate program performance against these results; up-front discipline for new spending proposals that must clearly define objectives and expected results and determine how they relate to existing programs and the priorities of government; and strategic reviews, the ongoing assessment of each department's spending to ensure that all programs are effective, efficient, and provide value for money. Strategic reviews are a key element in what we've called EMS renewal.
I'd like to emphasize that strategic reviews are not a cuts exercise. They are an ongoing process to allow ministers to take a hard look at what works and what doesn't. They are about looking for opportunities to improve how departments and agencies do business so they can provide the best programs and services to Canadians. In that sense, they're about good government.
In terms of the process, strategic reviews are owned by ministers. Ministers, supported by deputy heads, are responsible for conducting the review of their organizations in accordance with the terms of reference approved by Treasury Board.
A key requirement is that review organizations systematically assess 100% of their direct program spending to ensure that programs are aligned to government priorities, achieve intended results, and are efficiently delivered.
This comprehensive evaluation is based on facts and groups together the analysis of both the financial and non-financial performance of each program. It is based on the department's Program Activity Architecture and on the information and analysis with respect to evaluations, audits and evaluations done under the Management Accountability Framework.
In undertaking the reviews, departments and agencies examine their program spending with a view to seeking opportunities to better focus their programs and services, streamline operations, and transform the way they do business to achieve results for Canadians.
As part of the review process, departments are required to identify the lowest-priority and lowest-performing 5% of programs whose funding could be reallocated to other priorities within the department or to meet other government priorities. As well, as part of the review departments identify opportunities for reinvestment.
Once reviews have been completed, ministers present the results of the reviews to the Treasury Board for its consideration. The Treasury Board assesses the reports and recommendations for changes to programs and funding levels developed by individual ministers. In turn, the President of the Treasury Board, on behalf of Treasury Board ministers, reports its recommendations on proposals developed by ministers to the priorities and planning committee of cabinet as input into budget planning. Reallocations and reinvestments announced in the budget are those approved by cabinet.
The first two rounds of strategic reviews undertaken in 2007 covered approximately $43 billion of direct program spending.
The first round of strategic reviews in 2007 identified re-allocations or savings ramping up to about $385 million per year. The results were presented in the 2008 budget.
The second round of strategic reviews was undertaken in 2008 and identified savings ramping up to about $585 million. The results were presented in the 2009 budget.
These savings were reallocated to higher-priority areas, either through reinvestments in the departments that undertook strategic reviews or through investments in priority areas in other organizations.
In closing, I'd like to thank you for the opportunity to provide an overview.