Canadian Heritage’s quarterly financial report for the quarter ended June 30, 2021
On this page
- 1. Introduction
- 2. Highlights of fiscal quarter and fiscal year-to-date (YTD) results
- 3. Risks and uncertainties
- 4. Significant changes in relation to operations, personnel and programs
- 5. Approval by senior officials
- Statement of authorities (unaudited)
- Departmental budgetary expenditures by standard object (unaudited)
1. Introduction
This first quarterly financial report should be read in conjunction with the 2021-22 Main Estimates, approved supply as of June 21, 2021, and the 2021-22 Supplementary Estimates A along with the 2020-21 Main Estimates and Supplementary Estimates A. It has been prepared by management as required by section 65.1 - Quarterly financial reports of the Financial Administration Act and is in the form and manner prescribed by the Treasury Board in accordance with the special purpose financial reporting framework described in the Directive on Accounting Standards: GC4400 Departmental Quarterly Financial Report. The first quarterly report has not been subject to an external audit or review.
The quarterly financial report outlines the results, risks and significant changes in operations, personnel and programs and includes financial information tables for the quarter. The purpose of the quarterly financial information tables is to provide a comparison of in-year departmental spending with authorities granted by Parliament, as well as comparative financial information for the preceding year.
1.1. Authority, mandate and programs
The Department of Canadian Heritage and its Portfolio organizations play a vital role in the cultural, civic and economic life of Canadians. Our policies and programs promote an environment where Canadians can experience dynamic cultural expressions, celebrate our history and heritage and build strong communities. The Department invests in the future by supporting the arts, our official and indigenous languages and our athletes and the sport system.
Further details on the Department of Canadian Heritage’s (PCH) authority, mandate and programs can be found in the 2021-22 Departmental Plan and the 2021-22 Main Estimates.
1.2. Basis of presentation
This first quarterly financial report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Department’s spending authorities granted by Parliament, and those used by the Department consistent with the Main Estimates and Supplementary Estimates A for the 2021-22 fiscal year.
The authority of Parliament is required before money can be spent by the Government. Approvals are given in the form of annually approved limits through appropriation acts, or through legislation in the form of statutory spending authority for specific purposes.
PCH uses the full accrual method of accounting to prepare and present its annual departmental financial statements that are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.
1.3. Canadian Heritage financial structure
PCH has a financial structure composed of voted budgetary authorities that include Vote 1 – Operating expenditures and Vote 5 – Grants and Contributions, and Statutory authorities which are composed of contributions to employee benefits plans, Ministers’ Salary and motor car allowances and Statutory Payments for Lieutenant Governors.
2. Highlights of fiscal quarter and fiscal year-to-date (YTD) results
2.1. Statement of authorities
PCH’s 2021-22 authorities available for use at the end of June 2021 have increased by approximately $98.8 million when compared to the same period in 2020-21. More specifically, the total available for use increased by $452.3 million in Vote 5 - Grants and Contributions, increased by $62.7 million in Vote 1 - Operating expenditures and decreased by $416.2 million in Statutory authorities.
In Budget 2021, the Government of Canada committed $1.9 billion to help support the arts, culture, heritage and sport sectors and reflect Canada’s diversity. On June 28, the Minister of Canadian Heritage presented the key components for the Department:
- The Recovery Fund for Arts, Culture, and Heritage and Sport sectors will leverage existing programs to provide $300 million over two years to organizations that are still struggling due to the pandemic. It will provide organizations and individuals with the financial means to help build organizational resilience and pursue business innovation and transformation. This will also contribute to advancing equity, diversity and inclusion in these sectors, as well as greening activities.
- The Reopening Fund will provide $200 million over two years through existing programming to help Canada’s festivals, cultural events, outdoor theatre performances, heritage celebrations, local museums, amateur sport events and more. It will support organizations and projects that deliver in-person experiences or events that draw visitors to our communities.
| Items | Vote 1 | Vote 5 | Statutory | Total |
|---|---|---|---|---|
| New funding for Arts, Culture, Heritage and Sport Recovery Fund and Reopening Fund for Events and In-person Experiences (Budget 2021) | 0.0 | 250.0 | 0.0 | 250.0 |
| Increase in the authorities available for use in 2021-22 compared to 2020-21 due to 2020-21 full supply being delayed to December 2020 | 50.8 | 108.7 | 0.0 | 159.5 |
| New funding to support arts and live events workers in response to the pandemic (COVID-19) (horizontal item) (Fall Economic Statement - 2020) | 1.3 | 63.3 | 0.2 | 64.8 |
| Increase in the Indigenous Languages and Cultures Program for the purpose of preserving, promoting and revitalizing indigenous languages (Budget 2019) | 0.0 | 27.5 | 0.0 | 27.5 |
| Net increase in funding to expand Canadian Heritage’s Community Support, Multiculturalism and Anti-Racism Initiatives Program and its Anti-Racism Action Program (Budget 2018, Budget 2019 and Fall Economic Statement - 2020) | 1.8 | 20.6 | 0.7 | 23.1 |
| New funding for Youth Employment and Skills Strategy (horizontal item) (Fall Economic Statement - 2020) | 0.5 | 15.8 | 0.1 | 16.4 |
| Increase for negotiated salary adjustments for various groups | 6.1 | 0.0 | 1.6 | 7.7 |
| Increase in funding to support the modernization and construction of community educational Infrastructures in the provinces and territories for the Official Languages Program (Budget 2017) | 0.0 | 4.0 | 0.0 | 4.0 |
| New funding to support a post census survey of official language minority communities (Budget 2020) | 3.2 | 0.0 | 0.0 | 3.2 |
| Other Adjustments | 0.0 | (0.8) | (0.7) | (1.5) |
| Sunsetting of funding to respond to youth-serving organizations’ increased demand in the Youth Take Charge Program and to expand its reach to a greater number of youths across Canada | 0.0 | (2.5) | 0.0 | (2.5) |
| End of the two-year funding for Expanding Support for Artists and Cultural Events, National Day for Truth and Reconciliation and 50th anniversary of the decriminalization of homosexuality in Canada (Budget 2019) | (1.0) | (34.3) | (0.1) | (35.4) |
| Funding received in 2020-21 only to establish a COVID-19 Emergency Support Fund for Cultural, Heritage and Sport Organizations | 0.0 | 0.0 | (418.0) | (418.0) |
| Grand Total | 62.7 | 452.3 | (416.2) | 98.8 |
2.2. Departmental budgetary expenditures by standard object
Total expenditures during the first quarter of 2021-22 have decreased by $144 million (29%) from $500.9 million to $356.9 million compared to the same quarter of 2020-21.
The Statutory Expenditures for the first quarter of 2021-22 decreased by $163 million, from $169.9 million to $6.9 million. This decrease is mainly due to sunsetting of one-time funding received for the COVID-19 Emergency Support Fund to support Cultural, Heritage and Sport organizations impacted by COVID-19. This large decrease is mainly due to the following programs which made Emergency Support Fund payments in the first quarter of 2020-21:
- $88.8 million – Canada Media Fund;
- $55.5 million – Sport Support Program;
- $7.9 million – Canada Music Fund; and
- $4.6 million – Canada Arts Training Fund.
The Vote 5 – Grants and Contributions for the first quarter of 2021-22 increased by $8.8 million, from $286.7 million to $295.5 million. This 3% increase is mainly due to the net effect of the below items:
- $28.7 million – Canada Music Fund: the increase is caused by new funding to support arts and live events workers in response to the pandemic (Fall Economic Statement – 2020);
- $24 million – Development of Official-Languages Communities Program and Enhancement of Official Languages Program: the increase is mainly caused by the timing of payments which were made earlier in 2021-22 compared to 2020-21;
- $8.2 million – Building Communities through Arts & Heritage: the increase is in part due to timing of payments which were made in the first quarter of 2021-22 compared to 2020-21 and in part caused by less payments being made in the first quarter of 2020-21 as a result of capital projects being put on hold following the COVID-19 pandemic;
- $3.1 million – Canada Cultural Spaces Fund: the increase is caused by more payments being made in 2021-22 compared to 2020-21 as a result of COVID-19 affecting capital construction projects in the form of closures and delays;
- $2.9 million – Community Support, Multiculturalism and Anti-Racism Initiatives Program and Anti-Racism Action Program: the net increase is mainly caused by the timing of payments which were more significant in the first quarter of 2021-22 compared to 2020-21; and
- $2.9 million – Museum Assistance Program: the increase is mainly caused by new funding for Youth Employment and Skills Strategy (Fall Economic Statement – 2020).
These increases are partially offset by the following decreases:
- $31.3 million – Sport Support Program: the decrease is caused by the timing of payments which were made earlier in the first quarter of 2020-21 compared to 2021-22; and
- $30.1 million – Canada Book Fund: the decrease in this quarter is explained by PCH’s efforts to disburse funds earlier in 2020-21 to the creative sector which was under extreme strain following the COVID-19 pandemic compared to 2021-22.
The Vote 1 – Operating expenditures for the first quarter of 2021-22 have increased by $10.2 million, from $44.3 million to $54.5 million compared to the same quarter of 2020-21. This 23% increase is mainly due to the below items:
- $5.8 million increase in Personnel expenditures is mainly due to the ongoing effect of last year’s ratified collective agreements and of the hiring of more staff given the new funding announced in the Fall Economic Statement – 2020, which resulted in an increase of PCH salary expenditures in comparison to the same quarter of 2020-21;
- $4 million increase in Professional and special services is in part due to Canada’s participation as the Guest of Honour at the 2021 Frankfurt Book Fair and in part due to the timing of payments for legal services which started in the first quarter of 2021-22 compared to the second quarter of 2020-21; and
- $1 million increase in Rentals due in part to new initiatives to support e-mail migration, the Cloud strategies and due to the timing of payments for the license for the integrated financial system - SAP which started in the first quarter of 2021-22 compared to the third quarter of 2020-21.
As noted in the table below, PCH has spent 19% of its authorities in the first quarter of 2021-22, which is lower than last year’s consumption of 28%.
Expenditures compared to annual authorities (in millions of dollars) - text version
| 2021-22 | 2020-21 | |
|---|---|---|
| Total available for use | 1,892 (100%) | 1,794 (100%) |
| Used during the quarter | 357 (19%) | 501 (28%) |
| Year-to-date used | 357 (19%) | 501 (28%) |
3. Risks and uncertainties
In the current context, PCH is exposed to heightened operational risks including people risk management as the Department closely monitors the impact of the COVID-19 crisis. As the situation related to the COVID-19 virus continues to evolve, PCH’s primary concern remains the health of its employees and their families. Canadian Heritage must also contribute to public service-wide efforts to address this situation and maintain federal government services. The Department continues to monitor emerging risks.
4. Significant changes in relation to operations, personnel and programs
Since the Department’s third quarter of 2020-21, there were changes to Canadian Heritage’s senior management personnel.
Hélène Laurendeau retired from her position as Deputy Minister of Canadian Heritage as of April 9, 2021, and Isabelle Mondou was appointed Deputy Minister of Canadian Heritage, effective May 3, 2021.
5. Approval by senior officials
Approved by:
Original signed
Isabelle Mondou, Deputy Minister
Gatineau, Canada
Date: August 17, 2021
Original signed
Eric Doiron, Chief Financial Officer
Gatineau, Canada
Date: August 17, 2021
Statement of authorities (unaudited)
| Authorities | Total available for use for the year ending March 31, 2022Footnote 1 | Used during the quarter ended June 30, 2021 | Year to date used at quarter-end 2021-22 | Total available for use for the year ending March 31, 2021Footnote 1 | Used during the quarter ended June 30, 2020 | Year to date used at quarter-end 2020-21 |
|---|---|---|---|---|---|---|
| Vote 1 - Operating expenditures | 215,173 | 54,510 | 54,510 | 152,423 | 44,335 | 44,335 |
| Vote 5 - Grants and contributions | 1,648,339 | 295,539 | 295,539 | 1,196,067 | 286,678 | 286,678 |
| Statutory - Contributions to employee benefit plans | 26,787 | 6,424 | 6,424 | 25,000 | 6,250 | 6,250 |
| Statutory - Minister of Canadian Heritage - Salary and motor car allowance | 91 | 23 | 23 | 89 | 23 | 23 |
| Statutory - Minister of State (Minister of Diversity and Inclusion and Youth) - Motor car allowance | 2 | 0 | 0 | 2 | 0 | 0 |
| Statutory - Salaries of the Lieutenant Governors | 1,196 | 404 | 404 | 1,196 | 380 | 380 |
| Statutory - Payments under the Lieutenant Governors Superannuation Act (R.S.C., 1985, c. L-8) | 637 | 0 | 0 | 637 | 0 | 0 |
| Statutory - Supplementary Retirement Benefits - Former Lieutenant Governors | 182 | 0 | 0 | 182 | 0 | 0 |
| Statutory - COVID-19 Emergency Support Fund - Support for Cultural, Heritage and Sport Organizations | 0 | 0 | 0 | 418,000 | 163,222 | 163,222 |
| Spending of Crown Asset Proceeds | 31 | 0 | 0 | 6 | 0 | 0 |
| Total Budgetary authorities | 1,892,438 | 356,900 | 356,900 | 1,793,602 | 500,888 | 500,888 |
| Total authorities | 1,892,438 | 356,900 | 356,900 | 1,793,602 | 500,888 | 500,888 |
Departmental budgetary expenditures by standard object (unaudited)
| Expenditures | Total available for use for the year ending March 31, 2022Footnote 1 | Used during the quarter ended June 30, 2021 | Year to date used at quarter-end 2021-22 | Total available for use for the year ending March 31, 2021Footnote 1 | Used during the quarter ended June 30, 2020 | Year to date used at quarter-end 2020-21 |
|---|---|---|---|---|---|---|
| Personnel | 205,740 | 51,986 | 51,986 | 152,975 | 46,217 | 46,217 |
| Transportation and communications | 2,512 | 54 | 54 | 3,699 | 240 | 240 |
| Information | 2,753 | 324 | 324 | 1,887 | 215 | 215 |
| Professional and special services | 24,497 | 6,990 | 6,990 | 16,964 | 2,987 | 2,987 |
| Rentals | 4,338 | 1,617 | 1,617 | 3,237 | 581 | 581 |
| Repair and maintenance | 1,316 | 132 | 132 | 978 | 99 | 99 |
| Utilities, materials and supplies | 3,090 | 160 | 160 | 2,193 | 127 | 127 |
| Acquisition of machinery and equipment | 6,484 | 254 | 254 | 1,737 | 212 | 212 |
| Transfer payments | 1,649,158 | 295,539 | 295,539 | 1,614,886 | 449,900 | 449,900 |
| Other subsidies and payments | 1,208 | 948 | 948 | 1,070 | 905 | 905 |
| Total gross budgetary expenditures | 1,901,096 | 358,004 | 358,004 | 1,799,626 | 501,483 | 501,483 |
| Expenditures | Total available for use for the year ending March 31, 2022Footnote 1 | Used during the quarter ended June 30, 2021 | Year to date used at quarter-end 2021-22 | Total available for use for the year ending March 31, 2021Footnote 1 | Used during the quarter ended June 30, 2020 | Year to date used at quarter-end 2020-21 |
|---|---|---|---|---|---|---|
| Revenue credited to the Vote | -8,658 | -1,104 | -1,104 | -6,024 | -595 | -595 |
| Total Revenues netted against expenditures | -8,658 | -1,104 | -1,104 | -6,024 | -595 | -595 |
| Total net budgetary expenditures | 1,892,438 | 356,900 | 356,900 | 1,793.602 | 500,888 | 500,888 |