Government Operations Committee on June 20th, 2017

[Mostafa Askari]

One thing you can consider, and I don't know how difficult that is, is to integrate the cabinet process with the TB submission process. These two processes are completely separate now. Departments go through the MC process to get their programs approved by cabinet, and once that is done and the budget is tabled, then the TB processes start. Obviously they can't align the two, if that's the case.

In jurisdictions that don't have this problem, such as Australia or Ontario, those two processes are all the same. You go through one process to get it approved by cabinet and Treasury Board at the same time. Everything is done at the same time.

So theoretically that is possible to do. I don't know how difficult that is practically. That's something that officials from the two departments should be able to help you with.

[The Chair, Conservative, Tom Lukiwski]

Thank you very much.

The floor is yours, Mr. Ayoub

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

Thank you, Mr. Chair.

Thank you for joining us, gentlemen.

We are talking of harmonizations, but, actually, parliamentarians need clear documents in order to base themselves on relevant information so that they are able to vote. I have familiarized myself with the document that was sent to us. It is called “Following the Dollar—Tracking Budget 2016 Spending and Tax Measures”. It is an interesting document. It really shows us the differences, the difficulties and the challenges, as you mentioned previously. Following the money comes with a number of difficulties and they are structural ones. What you are telling us is not new.

There are in place plans, a test and a pilot project that help us to follow the expenditures with faster and more rigorous study. A budget sets a course, but it sometimes varies in a year and, at that point, we have to react. That is the time when we as parliamentarians have to make decisions.

Is this initiative, of following each expenditure and providing statistics, currently improving communications between your organizations, parliamentarians, the Minister of Finance and the ministers in the Treasury Board?

[Jean-Denis Fréchette]

Thank you for the question.

We hope that it will improve things. A document like this is interesting for anyone involved in the areas of finance and accounting. We do hope that it will improve understanding for parliamentarians. Do not forget that we do not work for the departments, we work for parliamentarians. This document is a good example of something that can help parliamentarians to better grasp the difficulties that they have to resolve when they are looking at the budget process.

As Mr. Askari mentioned, it is not just a question of examining the budget process from the figures that you see in the main estimates or the budget. It is also important to clarify all the steps. It starts somewhere, meaning that an amount that appears in the main estimates has first been argued over in cabinet, then in the Department of Finance and the Treasury Board, not to mention in the approval stage.

In fact, we can see that amounts mentioned in the federal budget do not necessarily appear in the main estimates. They may only appear in the supplementary estimates. We have given the committee some examples. It gives you an overview of the difficulty for the Treasury Board and the time that approving some budgets can take. Infrastructure programs are good examples of programs that can require a lot of time.

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

It is also said that moving to an appropriation structure that is focused on objectives, as opposed to departmental expenditures, should in fact allow the process to be accelerated and be better understood before moving on. Do you agree with that hypothesis?

[Jean-Denis Fréchette]

I agree in part. Ideally, the approval process should be program by program, as the government previously asked. It is easier, for example, to examine one program and the corresponding amount, then another, and so on. High-level expenditures, such as statutory spending, budgetary spending or other kinds such as salaries, will now be based on the same objectives. That will certainly give you information of another kind, but there is still a large grey area where you will not have all the details of all the programs.

The argument is that you are going to go from 300 or 240 votes to 1,200. That argument is still valid. I reread this committee's 2012 report and the response to its members at that time used exactly the same argument. The officials said that it would not possible to have an approval process program by program, because that would require too many votes.

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

Yes, there certainly would be a large number of votes.

Perhaps, one day, it will be possible for us to vote electronically; it would be easier and quicker.

There is a pilot project at Transport Canada. If you are aware of the project, could you tell us a little more about it? Could it be extended to other departments?

[Jean-Denis Fréchette]

Mr. Jacques could probably give you more details about the Transport Canada project.

[Jason Jacques]

Alex.

[Alex Smith, Financial Analyst, Office of the Parliamentary Budget Officer, Library of Parliament]

As the member had mentioned, there is a pilot program where the grants and contributions of votes of Transport Canada have been divided into subject-type votes. It's a good question whether or not that pilot project will be expanded. The government started this and put it in place for one fiscal year. It has given no indication of whether or not it will be expanded to other departments, and, if so, when. That would be a great question to ask the Treasury Board Secretariat. It does at least move in the direction of program-type votes that this committee had recommended in 2012.

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

How long would it take for the project to follow...? Is it a year?

[Alex Smith]

They've had it in place for a year. When members asked the Treasury Board officials how it was going, they said it was going fine. They just haven't made any commitment to expand it, to do anything more with it.

How long it would take to expand it across the government to other departments would depend on the departmental accounting systems a little bit. They could at least expand it to a few more, to five or six departments, and see how it works and what the kinks are. However, there's no plan in place to do so at this time.

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

Okay. Thank you.

I have one final question.

Does this policy run the risk of compromising the government's ability to reassign funds to meet unforeseen needs? If so, would you be in agreement with authorizing departments to reassign part of one appropriation to another, without the need for additional parliamentary approval, as is done in Quebec? Is that a possibility? Could we come up with a recommendation to that effect?

[Jean-Denis Fréchette]

First, the Parliamentary Budget Officer does not make recommendations. You mentioned a different approach. In Quebec, credits are approved by a parliamentary committee, immediately and very soon after the budget, and some transfers are, indeed, authorized. Based on my current understanding of what is going to happen, there will still be an opportunity for departments to transfer some funds within those targets.

In terms of the programs, and you also referred to risks, unforeseen events, emergencies, and so on, I would say that this is a follow-up. In principle, there may be additional budgets, which is why supplementary estimates continue to exist.

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

Thank you.

[The Chair, Conservative, Tom Lukiwski]

Thank you.

We'll now go to five-minute rounds, starting with Mr. McCauley.

[Kelly McCauley, Conservative, Edmonton West, AB]

Gentlemen, it's a pleasure to have you here.

Mr. Askari, you talked about how we'll be losing the supplementary (A)s, basically. The next supplements will not get tabled until November, I think. Do you see a risk of six or seven months of lost oversight from when the supplementary (A)s disappear, from when we can actually view them?

[Mostafa Askari]

I'm not sure if you lose oversight, because you haven't approved anything yet. If the measures are not proposed in the supplementary estimates, you haven't authorized the spending, so the government cannot go ahead and spend on those programs. What it means is that it delays the start of the various programs, because the government has to wait until November to get them approved by Parliament before it can start spending money on those programs. The problem is that, again, the main estimates are tabled in April, but the main estimates essentially are based on the budget measures from the previous year. So you don't really see anything of the new measures until November.

That's actually the problem that exists right now. They are trying to fix this by changing the date, but we don't really see how changing the date by six weeks will resolve that problem. The government had an opportunity over the past two years to include more of those measures in the supplementary (A)s. Last year it went up to about 70% of the measures, and then this year it went back down to close to 40%. Obviously there is an issue there. There is some problem with the processes that are being used, so they can't include those things. I don't really see how that is going to resolve the problem.

[Kelly McCauley, Conservative, Edmonton West, AB]

We've heard repeatedly—it was in your report that came out in November and then in the supplementary (A)s report—that the issue is that we need reforms to the spending process, etc. Will moving the tabling of the supplementary (A)s to April 16 have any value if we don't have these reforms done?

[Mostafa Askari]

That's what we have been saying in our evaluation of this.

[Kelly McCauley, Conservative, Edmonton West, AB]

[Inaudible—Editor] value in moving the tabling date to April 16 if we don't have the reforms to go with it that will get the spending items in the main estimates, or even in the supplementary (A)s.

[Mostafa Askari]

That's correct. If there is a detailed plan to—

[Kelly McCauley, Conservative, Edmonton West, AB]

[Inaudible—Editor] a detailed plan. All we're doing is moving the date.

[Mostafa Askari]

That's right.

[Kelly McCauley, Conservative, Edmonton West, AB]

Should we even bother moving the date, then, at this point? Can you offer an opinion?