Mr. Speaker, I rise on a point of order with regard to the payment by the Canada Customs and Revenue Agency of ex gratia payments for the heating fuel rebates, and specifically the ongoing payments that are being made under a program that we all thought had been brought to a conclusion.
As you are aware, Mr. Speaker, the Government of Canada paid out over $1.4 billion in heating fuel rebates that the government said were urgently needed in January of 2001. To obtain the spending authority to make such payments, a Governor General's special warrant was granted because Parliament had been dissolved for the general election of November 2000 and had not yet been recalled. Unfortunately, payments are still being made even though that spending authority under the special warrant lapsed at the end of the 2000-01 fiscal year pursuant to section 30(2) of the Financial Administration Act.
I believe, Mr. Speaker, that you will find from the evidence I provide today that the Government of Canada does not have the authority to continue providing heating fuel rebates since its authority has lapsed. As Marleau and Montpetit state at page 697:
No tax may be imposed, or money spent, without the consent of Parliament.
Marleau and Montpetit also state at page 704:
--appropriations are always made with a time limit; the spending authorization provided under an appropriation act expires at the end of the fiscal year to which the Act applies.
Bill C-20 of the first session of the 37th Parliament states that it was “An Act for granting to Her Majesty certain sums of money for the public service of Canada for the financial year ending March 31, 2001”.
Section 3 of the act deals with the confirmation of the payments for special warrants for the fiscal year ending March 31, 2001, and states:
The payment from and out of the Consolidated Revenue Fund of the sum of $3,509,910,912 for the purposes set out in the schedules to the special warrants signed by the Governor General pursuant to section 30 of the Financial Administration Act and orders of the Governor in Council of December 13, 2000...January 9, 2001...and January 23, 2001...and published in No. 52 of Volume 134, and Nos. 4 and 6 of Volume 135 of Part I of the Canada Gazette dated December 23, 2000, January 27, 2001 and February 10, 2001, respectively, is hereby confirmed.
I draw your attention, Mr. Speaker, to the point that these warrants are for the fiscal year ended March 31, 2001 and Bill C-20 was for the fiscal year ended March 31, 2001. However the spending under this program continues.
Beauchesne's sixth edition makes a number of references to the expiration of spending authority, specifically citations 933 and 934. I made reference to these citations and citation 968 on June 8, 1999 at page 16053 of the Debates when I raised a point of order regarding the title of a supply bill and its reference to two fiscal years.
As you are aware, Mr. Speaker, while the government has the authority to make ex gratia payments, Parliament has to appropriate the funds for them. During Parliament's dissolution when there is no opportunity for appropriation for a payment that is urgently needed for the public good, Parliament has authorized the use of the Governor General's special warrants which must be confirmed in a supply bill placed before Parliament, which was in this Bill C-20 that I referred to earlier.
A brief history of the situation regarding the heating fuel rebate payments under the Governor General's special warrants is on pages 9 to 13 of chapter 13 of the 2001 report of the Auditor General of Canada, and I quote selectively. It states:
In the October 2000 Economic Statement, the government announced that it wanted to provide some relief for increased heating expenses. It proposed that those eligible to receive the January 2001 payment of the goods and services tax credit would also receive the relief for heating expenses. The amount of the relief would be $125 for individuals or $250 for families. The total estimated cost was $1.345 billion. On 19 October 2000, the House of Commons approved a Notice of Ways and Means motion that included the government's proposal.
It goes on to state:
On 22 October 2000, Parliament was dissolved for the general election. Legislation to authorize the payments had not been introduced before Parliament was dissolved...
On 12 December 2000, the Governor in Council approved an order-in-council to authorize payments for increased heating expenses. The recipients of the payments would be those eligible to receive the January 2001 payment of the goods and services tax credit...
On 9 January 2001, the Governor in Council directed that a special warrant be prepared to authorize the payment of $1.294 billion for relief for heating expenses. On 23 January 2001, the Governor in Council directed that another special warrant be prepared to authorize the payment of a further $227 million for the same purpose...
On 31 January 2001, the Canada Customs and Revenue Agency started mailing cheques to about 8.6 million recipients. The total cost of the relief for the year ended 31 March 2001 was $1.459 billion. The payments were charged to the Canada Customs and Revenue Agency's operating expenditures vote and are included in Other Transfer Payments in the Public Accounts of Canada...
It goes on to state, “The special warrants were reported to Parliament on 12 February 2001 in a document entitled “Statement on Governor General's Special Warrants”.
That is the end of the selective quotes from the Auditor General's report.
On page 30 of that statement on Governor General's special warrants, there is an amount under vote 1 for Canada Customs and Revenue Agency of $1,706,171,342 of which $1,521,819,000 was available to the government under the heating fuel rebate program. According to the Public Accounts of Canada at year ended March 31, 2001, the government had spent $1.459 billion, leaving a balance of $62,819,000 authorized but unspent.
As you will agree however, Mr. Speaker, there was no authority for the government to carry that amount forward to a subsequent year, and that is the point which I am arguing.
In Marleau and Montpetit at page 747 there is a short dissertation on the use of Governor General's special warrants. I know, Mr. Speaker, of your particular interest in the use of Governor General's special warrants. On page 747 of Marleau and Montpetit, it summarizes section 30(1) of the Financial Administration Act, and states:
In a very special circumstance, the Financial Administration Act allows the Governor in Council... to issue a Special Warrant...provided that the following conditions are met:
Parliament is dissolved;
A Minister has reported that an expenditure is urgently required for the public good; and
The President of the Treasury Board has reported that there is no appropriation for the payment.
In short, all three principles must be present for a special warrant to be issued.
Therefore, I was very interested when I received a letter as chair of the Standing Committee on Public Accounts from Mr. Richard Neville, the Deputy Comptroller General of Canada, dated April 23, 2003, which states, among other things:
I am seeking the endorsement of the Public Accounts Committee for the following waivers to the publication of details related to ex gratia payments.
He goes on to say:
As the heating fuel rebate was based on the eligibility for the GST tax credit, additional payments will be made as periodic re-assessments for GST tax credit eligibility occur.
However that authority has long since expired for these payments.
Mr. Neville appeared as a witness before the Standing Committee on Public Accounts on May 12 to formally ask for a publication waiver in the Public Accounts of Canada for the fiscal year 2002-03 for a variety of items, including the heating fuel rebate. At the meeting of the Standing Committee on Public Accounts, Mr. Neville stated that for the fiscal year 2002-03, the amount paid out for heating fuel rebates totalled $13,086,165 and he indicated that the government would be paying out additional rebates for the fiscal year 2003-04.
I therefore went back to the previous year to see if there had been a request to the public accounts committee from Mr. Neville on this issue, requesting a publication waiver for heating fuel rebates. Mr. Neville in a letter dated May 14, 2002 to the public accounts committee stated:
We seek your continued support for the publication waiver of names associated with the residual payments of these two programs over the life of the programs.
He was referring to the heating fuel rebate and to a special benefit program for the merchant navy veterans.
I had no idea that when we were talking about what I thought were a few residual payments, we were talking about 277,000 claims for a total of $42.2 million in the fiscal year 2000-01, all paid out without authority. This is scandalous.
I mentioned earlier that there was an amount of $62.8 million that had been confirmed under Bill C-20 but unspent, but the authority to spend that money lapsed on March 31, 2001. The heating fuel rebate program is not a statutory program. There is no legislation which states that the payments for the heating fuel rebate must continue ad infinitum because the warrant was issued since the government had determined there was an emergency and Parliament was not sitting. There has been ample opportunity for the government to make a new request for supply and the emergency has long since passed.
Treasury Board seemed to believe that the passage of a special warrant allows the government to pay money year after year for a program that was supposed to be a one time occurrence and urgently required for the public good.
Moneys appropriated by Parliament may be only spent in the year in which they are appropriated. Speaker Parent in his ruling of June 8, 1999 at pages 16065-6 of Hansard clearly stated:
The House is quite aware of the concept of the fiscal year which runs from April to March, and the concept of the yearly appropriation bill which must be based on the estimates for a fiscal year and which must be adopted by parliament to cover the government's expenses for that fiscal year. We are very familiar with these notions of fiscal year and annual appropriations, which are the cornerstones of our parliamentary financial process.
Indeed, Speaker Parent took exception to the title of the appropriations act in Bill C-86 which referred to two fiscal years. He qualified the reference as “not needed” and “misleading”. This is also referenced in Marleau and Montpetit at page 741, footnote 268.
Mr. Speaker, I therefore ask that you reduce Canada Customs and Revenue Agency's vote 1 by $55,296,790 in the main estimates for the fiscal year ending March 31, 2004 to reflect the situation, unless the government apologizes for this affront to the House and rectifies the situation.
The House and its Speaker have expressed dismay several times in the past when it has been determined that the House has not been properly informed. This situation is another blatant attempt by the government to bypass Parliament, ignore Parliament's express rule that (a) money cannot be spent without Parliament's approval, and (b) money is granted for only one year.
In order to maintain the dignity of the House, I ask that you rule in favour of my point of order and reduce the Canada Customs and Revenue Agency's vote by $55,296,790, reflecting that $42,210,625 spent without authority in 2000-01 and the $13,086,165 spent in 2001-02.
In addition to this, Mr. Neville advised the Standing Committee on Public Accounts that he anticipated additional payments during this fiscal year ending March 31, 2004. I therefore ask that you order the government to cease all further payments under the heating fuel rebate program until the proper parliamentary authority has been sought and given.