Evidence of meeting #51 for Public Accounts in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was budget.
A recording is available from Parliament.
Liberal
The Vice-Chair Liberal Jean Yip
Thank you.
For the final round, we have Mr. Stevenson for five minutes.
October 26th, 2026 / 4:30 p.m.
Conservative
William Stevenson Conservative Yellowhead, AB
Thank you.
In your discussions here about timeliness and lining things up, maybe you can clarify this. When we look at this, next week we're supposed to have the budget that says 2026-27. If that's really the budget, in November 2026, we're already more than halfway through. To me, your budgeting should be for the future that you're going to be lining up, so that when you have your budget for the end of the year....
Can you square that circle for me as to how this is going to improve our transparency? We've already spent eight months of it by the time we get through this, or seven and a half months, anyway.
President Emeritus, C.D. Howe Institute, As an Individual
If I may, Nick, I'll jump in on this one.
I appreciate the opportunity to clarify something that we perhaps weren't clear about. In fact, what we are saying is that, de facto, the fall budget that we're about to receive is the budget that's for the upcoming fiscal year, not the one that we're already in.
If it's treated as the budget for the fiscal year we are already in, I completely agree with what you've said about the problem that creates. We are already most of the way through the fiscal year. The commitments have been made, and it is much too late to be presenting a budget for the 2026-27 fiscal year when you're this late in 2026.
I'll just recap and say that we are treating the budget that's going to happen in November as the budget for the upcoming fiscal year that will begin on April 1 of next year. That's a good fiscal accountability cycle. It is inappropriate to call it a budget for the current fiscal year. That ought to have happened much before now.
Conservative
William Stevenson Conservative Yellowhead, AB
Thank you. That does help the clarity.
Can you comment on one other thing that I tend to get a lot of questions about from my constituents? They'll say that we had a budget in November, yet in January, March or June following that budget, we have billions of unaccounted-for budget amounts and announcements that come out. They'll say they're going to spend another few billion on this and a few billion on that, yet they're not actually in the budget. Then they have to be accounted for when they do spend the money in future programs.
Can you explain to us at the committee how that really affects our transparency and the clarity of the actual financial numbers?
President Emeritus, C.D. Howe Institute, As an Individual
It's a great concern. I alluded to it very quickly earlier.
In my mind, the federal government's projections for spending and borrowing in successive budgets and in economic or fiscal updates have not proved to be very reliable. This cycle of making announcements in between times is a problem. I would argue that, in fact, the habit of making fiscal updates, mini budgets with important tax changes and so on, is equally a problem.
In the U.K. recently, the government has been floating the idea—we'll see how well they stick to it—of ensuring that the annual budget is the budget that is the key fiscal document in which all major tax changes and program changes occur.
I think that would be a very good thing to do. It would make Parliament's oversight role easier. I think it would also insulate us from temptations to make these ad hoc announcements, which, on the whole, have tended to be unhelpful to the bottom line. It would be much better to have the whole thing wrapped up in an annual budget cycle that Parliament could consider properly and have fewer announcements of major spending programs and major tax changes that are done by announcements, press releases and so on.
Conservative
William Stevenson Conservative Yellowhead, AB
I agree that it would be good, theoretically, but how do we, as the opposition or even the rest of the government, come up with a structure that actually enforces following those kinds of rules, so that they don't completely change what the numbers will actually be with these ad hoc announcements?
Research Officer, C.D. Howe Institute
If I can jump in here, I'll bring this back to the point on the main estimates. One of the advantages of simultaneously presenting the main estimates and the budget and having them reconcile with each other is that there is no outside information. Right from there, any additional announcement would automatically be in supplementary estimates.
Having such a grey zone between those two dates can muddy the waters even more for somebody wanting to track those down. Just on the main estimates side, that would be one suggestion.
Liberal
Liberal
Daniel Gobeil Liberal Chicoutimi—Le Fjord, QC
Thank you both for your remarks.
You talk a lot about reporting timelines. Since I'm a new member of the committee, can you tell me what the difference is between the way the federal government and the provinces work when it comes to public accounts and deadlines? You're comparing the different timelines. Could you explain to me a little bit about the difference between the two levels of government when it comes to this work?
President Emeritus, C.D. Howe Institute, As an Individual
The point I made earlier was that the federal government is a more complex organization in many ways, but it also has greater resources, so I'm not clear why the federal government could not produce some of its documents faster.
On the link with provincial finances, I have two related points. One is that we want the federal government to present its budget in a timely way because the transfer payments it makes to other levels of government are very important in their budgeting processes. In a situation such as happened repeatedly over the past decade, where a province would produce its budget ahead of its fiscal year, ahead of April 1, but the federal government would produce its budget after April 1, you had situations where the province might find it was counting on revenues that were going to be different from what the federal government reveals it would have.
The other point is something we touched on, that faster production of the numbers means faster gathering of the data. The federal government's estimates, for example, of tax revenue that it shares with the provinces that it has tax-sharing agreements with, are other important things where the faster gathering of information could assist other levels of government.
Liberal
Daniel Gobeil Liberal Chicoutimi—Le Fjord, QC
Thank you.
You talked about transfers to the provinces, but a number of my colleagues have talked about the government's favourable position in terms of the current economic snapshot and the importance of making profitable investments. You talked about airports, ports and all the projects that can generate revenue for the government.
When it comes to these types of cost-effective projects, how important is it for the territories and provinces to work together on planning?
President Emeritus, C.D. Howe Institute, As an Individual
The high yield from good investments in infrastructure is one that is largely indirect to the governments. They don't necessarily yield revenue directly, but if they are supporting more vibrant international trade, stronger internal trade and projects that would otherwise not have gone ahead, then the economy grows, people's incomes grow and government revenue benefits from that. It's very much to be wished for.
The concern I have—and I'll be very quick, because I might not be addressing your question directly—is that if the federal government does come under fiscal pressure, which can sometimes result from the fact that these transfer payments are flowing rather generously, the transfer payments to other levels of government have historically been a vulnerability when the federal government retrenches.
One of the reasons I would like to see them on a more sustainable fiscal track right now is that it means provinces can count on the supports they're getting, for health care particularly, into the more distant future in a way that they cannot if the federal government gets into fiscal trouble.
Liberal
Daniel Gobeil Liberal Chicoutimi—Le Fjord, QC
I'd like to ask you one last question.
We're talking about investments, but we know all the economic instability currently affecting the various traditional partners. Are periods of instability like the one we're experiencing right now not, in fact, a good time for the government to invest in economic infrastructure to generate additional revenue? I would like you to tell us about the opportunity in front of us at this time.
President Emeritus, C.D. Howe Institute, As an Individual
I'll be quick, because the list is potentially very long. In addition to the comments that we have been making about infrastructure that supports external trade, I will emphasize that there is a lot of opportunity for us to support ourselves in Canada by liberalizing internal trade.
It's a tough file, because many of the things that need doing are small-looking regulatory differences. It's not very exciting to address them. In fact, it can be very tedious to address them, and every barrier has its own justifications and vested interests. Some of the estimates of how big a boost to GDP we can get by knocking down internal trade barriers are probably a little ambitious, but there's a lot to be done there. Of course, we're not dependent on anyone other than ourselves to reap some of those benefits, so that's a good investment.
Liberal
Jean Yip Liberal Scarborough—Agincourt, ON
Thank you.
Mr. Blanchette‑Joncas, you have the floor for two and a half minutes.
Bloc
Maxime Blanchette-Joncas Bloc Rimouski-Neigette—Mitis—Matapédia—Les Basques, QC
Thank you.
Mr. Robson, in his analysis of Public Accounts of Canada 2025, the Parliamentary Budget Officer excluded the investment category, which represented $94 billion. Over six fiscal years, that's about 30% of the money. Therefore, according to his definition of the operating budget, the government's accounts remain in deficit. I'm trying to see if there was an attempt to doctor the budget presentation a bit to give the government a positive image of returning to a balanced operating budget.
In your opinion, is that the case?
President Emeritus, C.D. Howe Institute, As an Individual
It is hard to look into someone else's mind, but I do not agree with some of the overlays that we are now having with respect to capital spending.
At the risk of repetition, I'll say that the way the public accounting standards currently followed in Canada handle capital makes all kinds of sense. The federal government has adhered to it over the years. The Auditor General has given a clean opinion on the federal government's public accounts for those reasons. I think it makes a lot of sense to just continue to use that framework, because it's the one that, as my colleague emphasized already, is most consciously directed to figuring out what the government's capacity is to deliver services. Is it improving, or is it not improving? To have a separate budget for capital that adds and subtracts things that the public accounts already integrate so well seems to me to be a distraction.
Bloc
Maxime Blanchette-Joncas Bloc Rimouski-Neigette—Mitis—Matapédia—Les Basques, QC
Mr. Robson, in your opinion, what indicators should parliamentarians prioritize to judge whether public finances are improving?
President Emeritus, C.D. Howe Institute, As an Individual
Certainly, if the Auditor General did not give a clean opinion, that would be a red flag. Happily, that has not currently been the case, and I hope it continues not to be the case.
One of the things I think the public accounts committee can do—and it's one of the reasons I favour timelier publication—is look at what the differences are between the budget projections and the bottom line on the public accounts, and also, relatedly, whether the government's accumulated deficit rose or fell by the same amount that you would expect when you see the bottom line. There are two potential gaps there. The projections could be wrong, or there could be restatements that happen at the end of the fiscal year, but they both amount to the same thing. They are gaps. They are wedges between what parliamentarians can control ahead of time and what the actual result is. I think that's very good work for the public accounts committee to do, to look at those two gaps.
Liberal
Jean Yip Liberal Scarborough—Agincourt, ON
Thank you.
Thank you to our witnesses for their testimony and participation in relation to the study of the Public Accounts of Canada 2024 and the Public Accounts of Canada 2025.
We will now suspend the meeting to go in camera for the consideration of draft reports.
[Proceedings continue in camera]