Evidence of meeting #139 for Government Operations and Estimates in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was budget.
A video is available from Parliament.
Chief Financial Officer, Financial Management Directorate, Corporate Services Branch, Department of Finance
Unfortunately, I am not part of that process, so I cannot speak to that.
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
All right, so we can't get answers that we would want about the process.
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
I can, Mr. Blaikie, and as we see—
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Well, how soon would you know that cabinet has approved things that they haven't shared with you?
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
I am part of the process by which the budget is finalized, so I know when cabinet is making those decisions, and I also sit at the Treasury Board table where I see departments bring forward their items for approval.
As we have seen in years past, there can be a considerable time lag between the budget decision and TB approval, and in some cases this can stretch out over years. We have seen in previous supplementary estimates budget items from budget 2015 and budget 2016. It really does vary according to the initiative under consideration and whether there are detailed discussions and negotiations required with other parties, be they provincial governments, NGOs, contracting, etc.
There is no simple answer to that question.
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Treasury Board is not an inherent part of the pre-budget process, in other words.
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
I would argue that they are. We work with Finance to do a challenge function on the departmental requests to determine that the costings are reasonable and that the program gap to be filled is something—
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Why is it not possible to have Treasury Board submissions for new budget initiatives done prior to the release of the budget or, at the very least, the release of the main estimates?
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
In fact, it is. What we saw in the document tabled on April 16 are allocations proposed by Treasury Board for items that, in fact, have already been—
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Yes, for $221 million over $7 billion, so it's a considerably small percentage, I think it's fair to say, by just about any measure.
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
The president has cited other jurisdictions, Australia and Ontario in particular—
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Yes, indeed, where that work is done, and, in effect, the promise made in the debate about extending the deadline for the tabling of the main estimates was that more items would go through Treasury Board. I was hoping we might get a bit of a different take, frankly, from the Department of Finance, because we have heard from you often on this. I see that's not in the cards, and there are some other questions I want to ask.
At what point would departments have been notified that funding was being proposed for their department in the new central vote as opposed to an ask for them to submit through the regular approval process? Was there a memo circulated to departments letting them know about the new central vote?
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
Not to my knowledge. There was a conference call and a subsequent email, to which I believe you've requested access under an access to information request—
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
If I'm not mistaken, it was the day after the budget.
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
What was revealed to departments then was that some of the funding for their new budget initiative or—
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
We explain in a fair bit of detail how the central vote would work, what it would look like, and how departments would access funding for the budget initiatives if the item was included in the central vote.
For the items that had already been approved, no further action was required by departments, so everything that we're talking about today is items that have already been approved by Treasury Board, and that money will be allocated upon release of supply.
For everything else—in response to Mr. McCauley's question—these are items that are under development by departments, so they are actively working now on Treasury Board submissions that define the program terms and conditions, how many FTEs are required, what results they hope to achieve, the indicators they will use, the partners they are working with, and the contracts that will be required. All of this is happening in real time, and we have updated the allocations from the vote—
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Under the former process, that is work that would have been done before estimates or a particular approval came to committee for approval by parliamentarians.
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
Correct. In the former process, Parliament would have seen the results of those approvals in subsequent supplementary estimates—
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
So it's new that parliamentarians don't necessarily have the benefit of that work when they're asking departments questions about whether funding is justified or not.
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
Respectfully, I would argue to the contrary that what we're seeing now in the main estimates is a complete list of all of the items, and right now we have in the vote—
NDP
Daniel Blaikie NDP Elmwood—Transcona, MB
Yes, but just on the point of program development through Treasury Board submission—
Conservative
The Chair Conservative Tom Lukiwski
I know we have the Treasury Board officials here for the full two hours, but unfortunately, we'll have to get back to that. I appreciate, Mr. Pagan, that you want to further expand on your answer but we'll have to do that in a subsequent question.
Monsieur Drouin, for seven minutes, please.
Liberal
Francis Drouin Liberal Glengarry—Prescott—Russell, ON
Thank you, Mr. Chair.
I want to thank everyone for being here. I think this is probably the most witnesses I've seen in one sitting.
Mr. Pagan, I want to go back to how we got here. I know that this committee and my predecessors, including Mr. Pat Martin and his committee in 2012, went through the reasons that we needed to align the main estimates. You touched a little bit on the budget implementation vote, the famous vote 40. Other jurisdictions in Canada do this, and I think Ontario is one of them. Is that right? To your understanding, is the process they go through very similar to what we're going through right now?
Assistant Secretary, Expenditure Management Sector, Treasury Board Secretariat
For the benefit of the committee, I'll remind you of the president's agenda related to estimates reform. He wanted to fix the timing of the processes so that we properly sequenced the documents—a budget and then the estimates. That would also support a reconciliation between the two documents. That was pillar two of his agenda. The third was the idea that we might look at alternate bases of parliamentary control. Instead of votes by inputs, look at purpose-based votes. The fourth was better reporting, primarily through reformatted table documents and such online tools as TBS InfoBase.
In response to your question about how we got here, the report from this committee in 2012 identified many of these issues. The president's agenda responded to that. We fixed the timing. With the estimates now after the budget, we are able to bring all of the budget items into the estimates by department, by initiative, and by amount. That's a very important point. In the past, we would have included a budget item in the supplementary estimates, we would have named the department, we would have named the initiative, and we would have had the amount. We would have tagged that as budget 2015, budget 2016, or whatever.
The amount of information that is provided in the budget implementation vote is completely consistent with the type of information that we previously would have provided in a supplementary estimates document. Instead of waiting to see when that will come, and how the estimates will align with the budget, we believe we have added to the transparency of the process by listing every single item that's in the budget to the same level of detail that would otherwise have been appearing sometime down the road in the supplementary estimates process. There's no waiting. There's no gap between the budget and the estimates. We're identifying what we believe are the maximum authorities required by departments to implement the budget initiatives.
With respect to Mr. McCauley's question about the difference between the allocated and the amounts withheld, there's nothing nefarious here. We've spoken to this point. It speaks to the fact that the budget item is all in. It identifies the full cost of the initiative, whereas the estimates only seek the cash required to implement the initiative. The difference is the amounts covered through other authorities. We have employee benefit plan costs. The EBP costs are withheld because there's a statutory basis for those payments. Likewise, when the department comes forward with their initiative, they are charged accommodation costs so that we can make this cost-neutral for PSPC to provide accommodations and real estate space for departments.
So the amounts withheld reflect the other authorities required to implement the budget initiatives. What we are seeking is the cash, but we're reporting the full cost of the initiative. Again, we believe this enhances the transparency of the process for parliamentarians.