Public Accounts Committee on May 1st, 2008

[Kevin Page]

Thank you for the question, Mr. Williams, and for your expression of goodwill in terms of my having that opportunity to work with you.

In terms of looking ahead at those two sorts of milestones and the role the Parliamentary Budget Officer will play in regard to those milestones, we would like as much as possible to be anticipatory in terms of looking at numbers going in so that we would have an opportunity to brief you as to what are the issues around the economic trends, what they mean fiscally, and how they may impact the fiscal planning frameworks, particularly in terms of risk and what they may mean in the broad range of possible economic outcomes that exist right now. As we read the papers, today and yesterday, and releases from Statistics Canada about a weaker economy, particularly in the first quarter, we need to have an opportunity to brief you in advance of those fiscal planning milestones.

[John Williams, Conservative, Edmonton—St. Albert, AB]

Yes, but my question was more that you're going to be relying, I presume, on the Department of Finance for the bulk of your information. Am I correct on that?

[Kevin Page]

The Department of Finance, as you know, sir, actually in terms of forecasting and establishing a fiscal framework, takes an average of 20 private sector economic forecasts. We will have access to that information, so we'll be able to look at those ranges. The Department of Finance takes a numerical average. We'll be able to look at the lows and highs even around those averages and provide rules of thumb as to what it means for the fiscal situation. But we will have access to Department of Finance information in that context.

[John Williams, Conservative, Edmonton—St. Albert, AB]

What I'm trying to figure out here in my mind is where the confirmation of the department's numbers will be, because this is the whole rationale for having a Parliamentary Budget Office: independent confirmation that we have faith in departments' budgets. If they're just taking, across the board, an average of 20 independent private sector analyses and you use the same, you're going to arrive at the same number. So where is the independent verification?

[Kevin Page]

What we will try to do, sir, is to ensure that people understand the range of assumptions that are underlying those economic forecasts and what they mean in fiscal planning terms. I don't think anybody has, as you know, sir, a perfect crystal ball, whether you look at errors of private sector forecasts over the past 10 years or the Department of Finance. It's kind of a mixed bag in terms of there being some positives and negatives in terms of different economic and fiscal variables. Partly because of the way we've managed the fiscal framework, there have been some significant surpluses.

[John Williams, Conservative, Edmonton—St. Albert, AB]

Yes, but we're not talking about retrospective analysis; we're talking about the prospective rationale.

A few years ago, we had a government that was bringing down four or five different projections in a year, which caused the motivation for the position to be created. Now that you're here filling this position, we are looking for credibility in the projections by the Department of Finance. Are you going to be doing that?

The question I'm concerned about is, given the stature of your position, if you ever were to disagree with the Department of Finance....

I think, for example, this week, Jeff Rubin from the CIBC brought that big “D” word—the deficit—back onto the table as a potential. If you were to say the same thing, I can imagine banner headlines across the nation saying, “The Parliamentary Budget Officer says we're back into deficits again”. How would you handle this dichotomy or disagreement with the Department of Finance, or do you ever intend to disagree with them?

[Kevin Page]

I think, sir, there are probably even officials in the Department of Finance who disagree with other officials in the Department of Finance over forecasts.

[John Williams, Conservative, Edmonton—St. Albert, AB]

But they will not have the stature that you have as the Parliamentary Budget Officer and the podium from which you would speak.

[Kevin Page]

Sir, I think the credibility of the Parliamentary Budget Officer will come from our ability to provide comprehension of what is involved in those economic forecasts and how it implicates the fiscal framework. The more we bring anything to the table, in terms of a better understanding of the risk and the ranges that would meet your fiscal framework, the more it will add credibility.

I think, sir, as you say, if I were to put another number out—a budget balance kind of number versus the Department of Finance's—it would become a major issue right away. But if I put out the ranges that are out there, I think we're all better informed to understand, in that kind of planning context, what it would really mean from the standpoint of a planning purpose. I think the credibility comes from better comprehension, as opposed to, “Here is my number; this is the Department of Finance's number.”

In terms of Mr. Rubin's comments about the possibility of a deficit, I think if you were to look at the range of private sector forecasts now and looked at the lower range in the economic forecast versus the higher range, taking the lower range on the economy, we probably could be looking at some small budgetary deficits; on the higher range, we would have obviously some budgetary surpluses.

Putting that kind of information out and showing what it means for fiscal planning is what we would like to do.

[The Chair, Liberal, Shawn Murphy]

Thank you, Mr. Williams.

Thank you, Mr. Page.

Mr. Marston, you have six minutes.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Thank you, Mr. Chair.

On behalf of our party, the NDP, I want to welcome you to this new and important position. We've waited for a while for a sense of accountability around budgets.

Mr. Young, in your remarks you referred to holding the government accountable. It strikes me that the delay in getting this office up and running and your position staffed up was regrettable, because we've had some budgetary cycles pass without the accountability you've talked about.

Not to be provocative, but there's an issue that is percolating around the House of Commons these days with regard to the government expecting parliamentary officers to vet communications plans and press releases through the PCO.

First of all, would you see that applying to you? Of course, that leads to a serious question. When you do produce a final report, will it be your report or would it be the Prime Minister's?

[William R. Young]

I think I should take this question.

Parliamentary institutions, including the Library of Parliament, are not subject to the same reporting relationships as government departments or agencies. We are the legislative branch of government; we work for and with you, and we're not subject to having to report in the same way as the departments and agencies of government. So, in effect, we are independent.

The issue with regard to the officers of Parliament, you'll have to raise with them. Their situation may be different from ours.

Nothing we do is vetted by government departments. I report, through the authority of the Parliament of Canada Act, to the Speakers of the House of Commons and the Senate. They are advised by a standing joint committee of both Houses on the Library of Parliament with regard to my operations. I'll be appearing before them in two weeks' time on my estimates.

Essentially, our policies reflect, we hope, the best practices that can be found or put in place, but they're applied through the parliamentary lens only to our operations.

Obviously, my appointment and those of the Clerk of the House and the Clerk of the Senate are Governor in Council appointments, and as such, the Privy Council Office has determined that we must be subject to the performance management program that applies to other Governor in Council appointments.

I will say, however, that the Parliamentary Budget Officer has one level of independence even higher than that, since his is a GCQ appointment, like those of members of quasi-judicial tribunals, and therefore his performance pay is built into his base salary, unlike those of either the Parliamentary Librarian or the Clerk of the House of the Clerk of the Senate.

I hope that answers your question.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

It comes close enough.

[Kevin Page]

Sir, if I may speak to whether this would be my report or the Prime Minister's report, the Parliamentary Budget Officer will be releasing reports, and they will be reports of the Parliamentary Budget Officer.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

That's reassuring to hear.

Am I out of time, Mr. Chair?

[The Chair, Liberal, Shawn Murphy]

You have about three minutes left, Mr. Marston.

[Wayne Marston, NDP, Hamilton East—Stoney Creek, ON]

Mr. Williams raised the concern, too, about the podium position that you would have. In light of the other conversation we just went through regarding the suggestion—and I want to be clear, the suggestion—of the potential of government interference, I'm reassured to hear that you see this office as independent.

I'm not suggesting at this point that these things have happened, by any means, but I think we're guardians, particularly in this Parliament, of the independence of an office such as yours. I'm pleased to hear the sense you're projecting that you'll stand firm in that view.

I won't have any actual question.

[The Chair, Liberal, Shawn Murphy]

Thank you very much.

Monsieur Bélanger, you have six minutes.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Thank you, Mr. Chair.

Mr. Page, can we take it for granted that yourself and your office will always be able to provide services to Parliamentarians in both official languages?

[Kevin Page]

Yes.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

Is that what you are going to do?

[Kevin Page]

That is what I intend to do.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

You are an officer of Parliament but not an agent of Parliament in the same sense as an Auditor General or an Elections Commissioner, for example. You are an officer but not an agent of Parliament.

[William R. Young]

I am an officer of the Library of Parliament.

[Mauril Bélanger, Liberal, Ottawa—Vanier, ON]

So, you do not have the status of an agent of Parliament.