Government Operations committee  Thank you, Mr. Chair, for having invited us today to talk about the government's response to the committee's report dealing with strengthening parliamentary review of the estimates. To help me today, I am accompanied by two colleagues: Mr. George Samiotis and Mr. Derek Armstrong.

Government Operations committee  They would code right now. Every transaction does have to get attached to a program. The key thing is, if you go back to capital, if they're coding against capital, it's very clear that it's capital. A building is a building. There's a control check to make sure they're not exceeding their spend total when they actually plan that purchase.

Government Operations committee  That's one of the key questions. We've had discussions with our Department of Finance colleagues, and internally there's still some value in tracking capital and operating. That's one of the questions departments asked: do they still have to report capital? Finance is interested in knowing what the capital spend will be.

Government Operations committee  It's a difficult one. I'll let Sally give her views. This is pure speculation on my part. Right now we have controls by capital, operating, grants and contributions, and we provide information by program. Effectively we'd largely be flipping it, so we would be doing controls by strategic outcome program-type structure but still tracking information on capital, operating, and Gs and Cs.

Government Operations committee  Legislatively there's nothing required. What is required is a decision from the government to go ahead and start implementation. We've been given instructions to work with departments to see if we can drive down the costs. That will likely feed into a discussion about the timeframe or if this should be done.

Government Operations committee  The question of today is at what level should Parliament vote money. We have put strategic outcome out there as the proposed model. It is true that departmental information in RPPs already includes information on strategic outcomes. The advantage to moving to a new model is that you can more easily tie the money you're voting on under strategic outcomes to RPPs.

Government Operations committee  The work to standardize the financial systems is ongoing. They are not going to be reprogramming systems next month. There's a lot of detailed design work to do before that starts to happen. What would be critical, if there is a decision made to change the structure of the votes, is that the decision be arrived at before they start the work to redesign the financial systems.

Government Operations committee  There are a couple of points on that front. It's not just the estimates that would change. We're changing the whole reporting framework for the Government of Canada. It's the estimates, the public accounts—because actuals have to go with the estimates—as well as the format of the quarterly financial reports that would change.

Government Operations committee  I wouldn't say it's voluntary because Treasury Board, as an organization, has the authority to issue policy and it's up to the departments to comply with that policy. All I'll say in the narrative is it's early days still, but we've noticed substantial improvement in the content as we've moved to standardize RPPs as well as what's in the estimates.

Government Operations committee  I'll give you a couple of examples. The benefit for Canada is the same as for some other countries in that it's simple and it's understandable. I need cash to buy a new vehicle or a new building. Everyone knows what that means. When you're dealing with accrual, if you are talking about buildings, you are dealing with concepts of depreciation.

Government Operations committee  The work in terms of moving to a potentially common financial system is right now outside the scope of Shared Services Canada. They're very much focused, if I recall correctly, on data centres, e-mail, and servers. I may have it wrong, but that's my recollection. On the question of moving to a common financial system, that work is being done in two places.

Government Operations committee  You could. They key thing is if you're changing the way Parliament controls, that changes the way departments manage. If we went to strategic outcome, we would have departments reprogram their financial systems and their supporting business processes. To change it and push it one level down would again be a form of a systems change, probably not as drastic, but I'm speculating here.

Government Operations committee  I'll get Sally to add some context around my answer, but we do work with departments to establish standards in terms of what goes into an RPP, DPR, as well as the content that goes into estimates and the quarterly financial statements. There are standards from a government perspective.

Government Operations committee  I think if you improve the narrative to explain why there are changes in program spending planned versus actual, you achieve the same thing. A change to program vote would not solve the issue we bumped into around the $3.1 billion.

Government Operations committee  I can give you an example. Think about Infrastructure Canada. They're constantly reprofiling money because they're difficult to realize. The economic action plan put additional money into existing programs. At the end of the year, the department was unable to spend part of that program money.