Department of Finance Canada Quarterly Financial Report for the quarter ended December 31, 2020 (unaudited)

Table of contents

1. Introduction

2. Highlights of Fiscal Quarter Results

3. Risks and Uncertainties

4. Significant Changes in Relation to Operations, Personnel and Programs

5. Approval by Senior Officials

1. Introduction

This Quarterly Financial Report has been prepared by management as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by the Directive on Accounting Standards, GC 4400 Departmental Quarterly Financial Reports. This Quarterly Financial Report should be read in conjunction with the 2020–21 Main Estimates and Supplementary Estimates of the Department of Finance Canada.

This Quarterly Financial Report has not been subject to an external audit or review.

1.1 Authority, Mandate and Program Activities

The Department of Finance Canada (the Department) helps the Government of Canada develop and implement strong and sustainable economic, fiscal, tax, social, security, international and financial sector policies and programs. It plays an important central agency role, working with other departments to ensure that the Government's agenda is carried out and that ministers are supported with high-quality analysis and advice.

The Department’s responsibilities include the following:

The description of the program activities for the Department can be found in Part II of the Main Estimates and the Departmental Plan.

1.2 Basis of Presentation

This Quarterly Financial Report has been prepared by management using an expenditure basis of accounting, and a special purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities. 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 for both fiscal years (2019–20 and 2020–21) as well as transfers from Treasury Board central votes that are approved by the end of the quarter.

The authority of Parliament is required before monies 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.

The Department uses the accrual method of accounting to prepare and present its annual departmental financial statements that are part of the departmental performance reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.

1.3 Department of Finance Canada – Financial Structure

The Department has three major categories of expenditure authority. These categories are:

2. Highlights of Fiscal Quarter Results

The following section highlights the financial results and provides explanations for the fiscal quarter ended December 31, 2020 as compared to the same period last year.

Highlights of the Fiscal Quarter Results
(thousands of dollars)
2020-21 Authorities as at December 31, 2020 2019-20 Authorities as at December 31, 2019 Variance in Authorities Expenditures during the quarter ended December 31, 2020 Expenditures during the quarter ended December 31, 2019 Variance in Expenditures
Budgetary Authorities
Vote 1 - Program Expenditures
3,426,811 109,566 3,317,245 1,101,858 30,668 1,071,190
Statutory Authorities
Major transfers to other levels of government
93,232,690 73,584,472 19,648,218 19,137,785 18,458,025  679,760
Interest on Unmatured Debt and Interest on Other Liabilities
20,499,000 24,691,000  (4,192,000) 5,007,211 5,238,505 (231,294)
Direct program expenses
568,303 590,410  (22,107) 274,554 310,244  (35,690)
Total Statutory Authorities
114,299,993 98,865,882 15,434,111 24,419,550 24,006,774  412,776
Total Budgetary Authorities 117,726,804 98,975,448   18,751,356 25,521,408 24,037,442 1,483,966
Non-Budgetary Authorities 250,200  51,400     198,800 11,315,348  10,598,964 716,384
Total Authorities 117,977,004 99,026,848   18,950,156  36,836,756   34,636,406   2,200,350

2.1 Statement of Authorities

As per Table 1 – Statement of Authorities (unaudited), the total authorities available for use increased by $18,950.2 million, as compared to the same quarter in 2019–20, from $99,026.8 million to $117,977.0 million.

The following table provides a detailed explanation of the changes in the authorities available for use:

Explanation of changes in authorities available for use
(2020-21 compared to 2019-20)
Budgetary Authorities Change (thousands of dollars)
Vote 1 - Program Expenditures
Parliamentary approval was obtained for measures authorized pursuant to the COVID-19 Emergency Response Act, but not disbursed before the legislative repeal date of September 30, 2020, to ensure funds remain available for additional planned transfers to provinces and territories, such as:
  • Funding for the Safe Return to Class Fund ($1,000,000);
  • Funding for the Province of Alberta to clean up inactive oil and gas wells ($1,000,000);
  • Funding for the Safe Restart Agreement ($700,000); and
  • Funding for the Essential Workers Support Fund ($461,000)
3,161,000
Funding for the 2020 Hibernia Dividend Backed Annuity Agreement Payment. 109,888
Funding for an ex gratia payment to Saskatchewan related to the Fiscal Stabilization program. 18,584
Transfer from the Privy Council Office for an advertising campaign to inform Canadians of the Government of Canada's COVID-19 Economic Response Plan.  12,000
Funding to support Indigenous participation in the Trans Mountain Expansion project.  11,356
Increase in lapsing funds from 2019-20 that contributed to the operating budget carry forward into 2020-21. 2,444
Other departmental adjustments 1,973
Sub-total Vote 1 - Program Expenditures 3,317,245
Statutory Authorities 
Increase in major transfers to other levels of government largely due to measures implemented through the government's COVID-19 Economic Response Plan, legislated growth for the Canada Health Transfer, the Canada Social Transfer, and Equalization, and a decrease in recoveries under the Alternative Payments for Standing Programs.  19,648,218
Decrease in interest on unmatured debt and interest on other liabilities primarily due to the downward revision of forecasted short-term and long-term interest rates by private sector economists. (4,192,000)
Decrease in direct program expenses mostly due to a decrease in the payment to the International Development Association. (22,107)
Sub-total Statutory Authorities 15,434,111
Total Budgetary Authorities 18,751,356
Non-Budgetary Authorities
Increase mainly due to a loan to Alberta’s Orphan Well Association to clean up orphan oil and gas wells. 198,800
Total Non-Budgetary Authorities 198,800
Total Authorities  18,950,156

2.2 Statement of Departmental Budgetary Expenditures by Standard Object

As per Table 2 – Departmental budgetary expenditures by Standard Object (unaudited), the total net budgetary expenditures in the third quarter of 2020–21 increased by $1,484.0 million, as compared to the same quarter in 2019–20.

In total, expenditures related to Transfer payments increased by $1,748.9 million over this period, largely due to financial support provided to Alberta to clean up orphan and inactive oil and gas wells, legislated growth for the Canada Health Transfer, Equalization, and a decrease in recoveries under the Alternative Payments for Standing Programs.

Other budgetary expenditures in the third quarter included:

  • Expenditures related to Public debt charges, which decreased by $231.3 million mainly reflecting a decrease in the average Government of Canada short-term and long-term bond rates;
  • Expenditures related to Other subsidies and payments, which decreased by $42.8 million mostly due to a decrease in the payments to the Canada Infrastructure Bank resulting from reduced funding requirements this quarter, offset by the revaluation of International Monetary Fund related accounts;
  • Expenditures related to Utilities, materials and supplies, which increased by $6.9 million primarily due to an increase in the purchase of domestic coinage as a result of increased demand in the current quarter, as compared to the same quarter in 201920; and
  • Expenditures related to Information, which increased by $3.8 million as a result of increased advertising to inform Canadians and businesses of financial assistance available to support them during the COVID-19 pandemic.

2.3 Non-Budgetary Expenditures

Total net non-budgetary expenditures in the third quarter of 2020–21 increased by $716.4 million, as compared to the same quarter in 2019–20. This is largely due to an increase in the value of loans disbursed to Crown corporations participating in the Crown Borrowing Framework, resulting from an increase in business requirements of the participating entities.

3. Risks and Uncertainties

The Department’s Corporate Risk Profile provides a snapshot of the Department’s key corporate risks. The Department monitors its corporate risks and associated risk responses to identify areas of opportunity and to reflect progress made in implementing mitigation strategies.

The impacts of COVID-19 continue to be felt globally and the Department has played a pivotal role in enabling the government to implement a broad span of support measures as part of the Government of Canada’s economic response. As the pandemic continues to unfold, the Department will monitor departmental risks associated with COVID-19 and ensure mitigation strategies are in place.

4. Significant Changes in Relation to Operations, Personnel and Programs

Effective December 14, 2020, Michael Sabia was appointed Deputy Minister of Finance, replacing Paul Rochon.

5. Approval by Senior Officials

Approved by:

Michael Sabia, Deputy Minister
Ottawa, Canada
February 26, 2021

Darlene Bess, Chief Financial Officer
Ottawa, Canada
February 26, 2021

Department of Finance Canada
Quarterly Financial Report for the quarter ended December 31, 2020
Table 1 – Statement of Authorities (unaudited)
(thousands of dollars)
Fiscal year 2020-2021 Fiscal year 2019-2020
Total available for use for the
year ending
March 31, 2021* 
Used during the
quarter ended December 31, 2020
Year to date used at
quarter-end
Total available for use for the
year ending
March 31, 2020*
Used during the
quarter ended December 31, 2019
Year to date used at
quarter-end
Budgetary Authorities
Voted authorities
Vote 1 - Program expenditures
3,426,811 1,101,858 1,171,446 109,566 30,668 78,637
Total voted authorities
3,426,811 1,101,858 1,171,446 109,566 30,668 78,637
Statutory authorities
Major transfers to other levels of government
Canada Health Transfer (Part V.1 - Federal-Provincial Fiscal Arrangements Act)
41,869,693 10,467,423 31,402,270 40,372,636 10,093,159 30,279,477
Canada Social Transfer (Part V.1 - Federal-Provincial Fiscal Arrangements Act)
15,023,242 3,755,810 11,267,431 14,585,672 3,646,418 10,939,254
Fiscal arrangements
Fiscal Equalization (Part I - Federal-Provincial Fiscal Arrangements Act)
20,572,844 5,143,211 15,429,633 19,837,259 4,959,315 14,877,944
Territorial Financing (Part I.1 - Federal-Provincial Fiscal Arrangements Act)
4,180,225 852,766 3,327,459 3,948,403 805,474 3,142,929
Statutory Subsidies (Constitution Acts, 1867-1982, and Other Statutory Authorities)
42,644 1,237 22,559 42,484 1,237 22,561
Youth Allowances Recovery (Federal-Provincial Fiscal Revision Act, 1964)
(853,724) - (516,669) (932,853) - (466,427)
Other major transfers
Additional Fiscal Equalization Offset Payment to Nova Scotia (Nova Scotia and Newfoundland and Labrador Additional Fiscal Equalization Offset Payments Act)
- - - 8,227 - -
Additional Fiscal Equalization to Nova Scotia (Part I - Federal-Provincial Fiscal Arrangements Act)
- - - (72,587) (22,456) (67,368)
Fiscal Stabilization (Part II - Federal-Provincial Fiscal Arrangements Act)
- - - - 271,733 271,733
Alternative Payments for Standing Programs (Part VI - Federal-Provincial Fiscal Arrangements Act)
(3,937,960) (1,082,662) (3,407,456) (4,204,769) (1,296,855) (3,399,240)
Refund of prior year expenditures
- - - - - (103,000)
Payment under subsection 24(1) of the Financial Administration Act resulting from a remission order issued pursuant to subsection 23(2.1) of that Act
- - - - - 3,067
Payment to the Province of Saskatchewan pursuant to paragraph 60.2(2)b of the Financial Administration Act to clean up orphan and inactive oil and gas wells
400,000 - 400,000 - - -
Payment to the Province of British Columbia pursuant to paragraph 60.2(2)b of the Financial Administration Act to clean up orphan and inactive oil and gas wells
120,000 - 120,000 - - -
Payment to the Government of Newfoundland and Labrador pursuant to paragraph 60.2(2)b) of the Financial Administration Act to support offshore energy sector workers
- - 320,000 - - -
Payments to the COVID-19 Essential Workers Support Fund pursuant to paragraph 60.2(2)b of the Financial Administration Act
2,539,000 - 2,539,000 - - -
Payments to the Safe Restart Agreement pursuant to paragraph 60.2(2)b of the Financial Administration Act
12,276,726 - 12,276,726 - - -
Payments to the Safe Return to Class Fund pursuant to paragraph 60.2(2)b of the Financial Administration Act
1,000,000 - 1,000,000 - - -
Total major transfers to other levels of government 93,232,690 19,137,785 74,180,953 73,584,472 18,458,025 55,500,930
Interest on Unmatured Debt and Interest on Other Liabilities
Interest on Unmatured Debt and Other Public Debt Costs
15,013,000 3,681,956 11,325,866 18,684,000 3,754,373 13,308,602
Interest on Other Liabilities
5,486,000 1,325,255 4,047,955 6,007,000 1,484,132 4,524,256
Total Interest on Unmatured Debt and Interest on Other Liabilities 20,499,000 5,007,211 15,373,821 24,691,000 5,238,505 17,832,858
Direct program expenses
Operating expenses
Purchase of Domestic Coinage
84,000 23,357 66,273 88,000 16,465 66,808
Contributions to Employee Benefit Plans
13,077 3,131 9,392 12,622 3,064 9,191
Minister of Finance - Salary and motor car allowance
89 (3) 34 88 22 66
Minister of Middle Class Prosperity and Associate Minister of Finance – Motor car allowance
2 - 1 - - -
Payments for government advertising programs pursuant to the Public Health Events of National Concern Payments Act
10,000 - 10,000 - - -
Transfer payments
Payment to the International Development Association (Bretton Woods and Related Agreements Act)
423,240 - - 441,620 - -
Debt payments on behalf of poor countries to International Organizations pursuant to section 18(1) of the Economic Recovery Act
37,895 - - 48,080 - -
Establishment of a Canadian Securities Regulation Regime and Canadian Regulatory Authority (Budget Implementation Act, 2009)
- - 40,331 - - -
Other
Losses on Foreign Exchange
- 228,247 519,577 - 2,576 24,286
Payment of Liabilities Previously Recorded as Revenue
- 822 12,173 - 917 3,086
Payment to the Canada Infrastructure Bank (Canada Infrastructure Bank Act)
- 15,000 32,185 - 287,200 524,838
Payment under subsection 12(2) of the Canadian Commercial Corporation Act to the Canadian Commercial Corporation
- 4,000 4,000 - - 2,500
Total direct program expenses
568,303 274,554 693,966 590,410 310,244 630,775
Total statutory authorities
114,299,993 24,419,550 90,248,740 98,865,882 24,006,774 73,964,563
Total budgetary authorities 117,726,804 25,521,408 91,420,186 98,975,448 24,037,442 74,043,200
Non-budgetary authorities
Purchase of initial shares pursuant to the Asian Infrastructure Investment Bank Agreement Act
50,200 - - 51,400 - -
Payment to Alberta’s Orphan Well Association pursuant to paragraph 60.2(2)b of the Financial Administration Act to clean up orphan oil and gas wells
200,000 - 200,000 - - -
Advances to Crown corporations (Gross)
- 11,207,348 33,681,523 - 10,525,476 33,044,207
Advances pursuant to section 13(1) of the Financial Consumer Agency of Canada Act (Gross)
- 8,000 11,000 - 3,000 11,000
Payments under Bretton Woods and Related Agreements Act- International Organizations (Gross)
- - 798,469 - 70,488 90,729
Purchase shares of the Canada Enterprise Emergency Funding Corporation pursuant to paragraph 60.2(2)(a)(i) of the Financial Administration Act
- 100,000 200,000 - - -
Total non-budgetary authorities 250,200 11,315,348 34,890,992 51,400 10,598,964 33,145,936
Total authorities 117,977,004 36,836,756 126,311,178 99,026,848 34,636,406 107,189,136
* Includes only Authorities available for use and granted by Parliament at quarter-end
Department of Finance Canada
Quarterly Financial Report for the quarter ended December 31, 2020
Table 2 - Departmental budgetary expenditures by Standard Object (unaudited)
(thousands of dollars)
  Fiscal year 2020-2021 Fiscal year 2019-2020
Planned expenditures for the year
ending
March 31, 2021
Expended during the
quarter ended
December 31, 2020
Year to date
used at
quarter-end
Planned expenditures for the year
ending
March 31, 2020
Expended during the
quarter ended
December 31, 2019
Year to date
used at
quarter-end
Expenditures:
Personnel
102,498 27,790 78,228 98,132 28,850 74,327
Transportation and communications
3,774 104 238 2,747 512 1,783
Information
23,775 3,825 14,466 1,889 75 726
Professional and special services
14,820 3,796 8,056 14,027 3,481 7,323
Rentals
1,926 203 756 1,885 214 836
Repair and maintenance
440 19 45 322 37 157
Utilities, materials and supplies
84,321 23,389 66,361 88,395 16,521 66,955
Acquisition of land, buildings and works
- 47 47 - - -
Acquisition of machinery and equipment
3,042 88 670 1,893 420 482
Transfer payments
96,974,748 20,206,891 75,290,390 74,075,307 18,458,025 55,502,030
Public debt charges
20,499,000 5,007,211 15,373,821 24,691,000 5,238,505 17,832,858
Other subsidies and payments
18,610 248,045 587,108 1 290,802 555,723
Total gross budgetary expenditures 117,726,954 25,521,408 91,420,186 98,975,598 24,037,442 74,043,200
Less Revenues netted against expenditures 150 - - 150 - -
Total net budgetary expenditures 117,726,804 25,521,408 91,420,186 98,975,448 24,037,442 74,043,200
Report a problem or mistake on this page
Please select all that apply:

Thank you for your help!

You will not receive a reply. For enquiries, contact us.

Date modified: