Departmental Sustainable Development Strategy 2020 to 2023

ISSN 2563-5956

Section 1: Introduction to the Departmental Sustainable Development Strategy

The 2019 to 2022 Federal Sustainable Development Strategy (FSDS) presents the Government of Canada’s sustainable development goals and targets, as required by the Federal Sustainable Development Act. In keeping with the purpose of this Act to provide the legal framework for developing and implementing a Federal Sustainable Development Strategy that will make environmental decision-making more transparent and accountable to Parliament, the Department of Finance Canada supports the goals laid out in the FSDS through the activities described in this Departmental Sustainable Development Strategy (DSDS).

Section 2: Sustainable Development Vision and Context in the Department of Finance Canada

Overall, the Department is committed to a more prosperous, stable, inclusive and sustainable economic future, based on the Department’s vision of sustainable development that aligns with its plan to keep the economy growing in a way that benefits more people today and in the future, contributing to a better quality of life for all Canadians. By providing analysis and advice, and through the development and implementation of policies, the Department engages in an approach to sustainable development that:

The Department is the Government’s primary source of analysis and advice on the broad economic and financial affairs of Canada. In addition to preparing the federal budget, the Department plays an important role in developing and implementing government policy in areas that fall within the Department’s mandate, including tax and tariff legislation, major federal transfers to provinces and territories, legislative and regulatory frameworks for the financial sector, and representing Canada within international financial institutions. As a policy-oriented department, the Department has limited direct involvement in delivering programs and services to Canadians, which is why the Minister of Finance is not responsible for any FSDS goal.

In its central agency capacity, the Department provides analysis and advice on the economic merit and fiscal implications of policy and program proposals developed by other government departments. Departmental officials serve as members of broader interdepartmental teams that review options for, and the implications of, proposals that are presented to Cabinet.

The Department focuses its attention and resources on contributing to a strong economy and sound public finances for Canadians by continuing to prioritize four priority areas: sound fiscal management; strong, inclusive and sustainable economic growth; a sound social policy framework, and effective international engagement. The Department will remain focused on ensuring Canada’s economy grows in a sustainable and inclusive manner, providing all Canadians with opportunities to contribute to and benefit from this growth. The Department will continue to incorporate environmental considerations into our analysis and advice, including by conducting Strategic Environmental Assessments as per the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals. 

Detailed information on how the Department of Finance will use its resources to contribute to a strong economy and sound public finances for Canadians is available in the current

Departmental Plan. The Minister of Finance is not responsible for leading any FSDS goal but is a key contributor to the following FSDS goals:

FSDS Goal: Greening Government – All departments and agencies contribute to this goal. The Department of Finance will continue its efforts to transition to low-carbon, climate resilient, and green operations in support of the goals and targets identified within the Federal Sustainable Development Strategy. The Department is committed to implementing green principles and practices in its operations in accordance with the Greening Government Strategy led by the Centre of Greening Government at the Treasury Board Secretariat. The Department’s actions promote innovation and sustainable practices through both the education and mobilization of its workforce, encouraging environmentally sustainable choices that reduce waste and energy consumption. The Department is committed to the ongoing modernization of its internal practices by leveraging technology to further reduce the Department’s reliance on travel and paper-based processes, which have been accelerated by the COVID-19 context. As per the Policy on Green Procurement, environmental considerations will continue to be integrated in procurement management processes and controls. To reduce the Department’s GHG emissions, executive vehicles will be replaced at the end of their life-cycle with zero-emissions vehicles or hybrids.

FSDS Goal: Effective Action on Climate Change – The Ministers of Environment and Climate Change and Transport lead on this goal. Pricing carbon pollution across the country is a central component of the Pan-Canadian Framework on Clean Growth and Climate Change. In October 2016, the Government published federal requirements to ensure that carbon pricing applies to a broad set of emission sources throughout Canada with increasing stringency over time. The Government also committed to implement a federal carbon pollution pricing system that would apply in a province or territory that requests it, and in provinces and territories that do not meet the federal stringency requirements. The Greenhouse Gas Pollution Pricing Act received Royal Assent on June 21, 2018, and provides the legislative framework for the federal system that is composed of a regulatory charge on fossil fuels (the "fuel charge") and an output-based pricing system for large industrial facilities. The Department is responsible for the policy underpinning the fuel charge, which is administered by the Canada Revenue Agency and currently applies in Ontario, Manitoba, Saskatchewan, Alberta, Yukon and Nunavut. The Department is also responsible for calculating Climate Action Incentive payment amounts to be specified by the Minister of Finance that, as administered by the Canada Revenue Agency, return the bulk of the direct proceeds from the fuel charge to individuals and families in Ontario, Manitoba, Saskatchewan and Alberta.

In addition to pricing carbon pollution, the Department of Finance Canada contributes to a low-carbon economy by providing tax incentives to adopt lower-emitting vehicles. These measures complement carbon pricing and zero-emission vehicle sales targets, which can lead to additional reductions in greenhouse gases and air pollutants.

FSDS Goal: Clean Energy – The Minister of Natural Resources leads on this goal. The Department of Finance Canada contributes to a more sustainable energy sector by providing tax incentives to adopt clean technologies. These measures complement carbon pricing and can lead to additional reductions in greenhouse gas emissions and air pollutants.

Section 3: Commitments for the Department of Finance

Greening Government: The Government of Canada will transition to low-carbon, climate resilient, and green operations

Responsible Minister: All ministers

This goal captures commitments from the Greening Government Strategy, as well as reporting requirements under the Policy on Green Procurement.
Greening Government Communities FSDS target(s) FSDS contributing action(s) Corresponding departmental action(s) Contribution by each departmental action to the FSDS goal and target Starting point(s) Performance indicator(s) Target(s) Program(s) in which the departmental actions will occur

Reduce GHG emissions from federal government facilities and fleets by 40% below 2005 levels by 2030 (with an aspiration to achieve this target by 2025) and 80% below 2005 levels by 2050 (with an aspiration to be carbon neutral)

*This target only applies to organizations that own real property. As a tenant organization, Finance Canada is only responsible for reporting on its fleet vehicles.

Fleet management will be optimized
  • Ensure that all new executive vehicle purchases will be ZEVs (zero emission vehicles) or hybrids
  • Driver training such as anti-idling will be provided

FSDS: Reducing GHG emissions from federal fleets
SDG: Target 13.2

Starting Point: The executive fleet currently consists of 3 vehicles, 2 of which are ZEVs or hybrids.

Performance Indicator: All new executive vehicle purchases will be ZEV's or hybrids.

Target: 100% of executive fleet comprised of ZEV's or hybrids.

Internal Services
Divert at least 75% (by weight) of non-hazardous operational waste from landfills by 2030 Other The department will work with Public Services and Procurement Canada (PSPC) and Treasury Board Secretariat at 90 Elgin to promote waste reduction by:
  • Promoting the use of recycling and composting programs currently in place at 90 Elgin
  • Promote awareness on proper use of recycling systems emphasizing minimizing contamination
  • Continue to explore and implement additional departmental recycling to expand on the existing programs such as coffee pod and office supply recycling

FSDS: Diverting waste from landfill reduces landfill gas and transport hauling emissions. Material recovery via recycling reduces emissions for the extraction and production of virgin materials.

SDG: Target 13.2

Starting Point: The waste diversion rate for Department of Finance floors is 66.3%.

Performance Indicator: The Department will use the results of annual 90 Elgin waste audits to assess progress on waste reduction.

Target: Ongoing improvement in annual diversion rate.

Internal Services
Divert at least 75% (by weight) of plastic waste from landfills by 2030 Other The department will promote reduction of single-use plastics in operations, events and meetings by:
  • Holding information sessions and ongoing promotion to inform employees on the importance of reducing the use of single-use plastics

FSDS: Diverting waste from landfill reduces landfill gas and transport waste hauling emissions. Material recovery via recycling reduces emissions for the extraction and production of virgin materials.

SDG: Target 13.2

Starting Point: Plastic waste represents approximately 5.7% of waste generated annually on floors occupied by the department.

Performance Indicator: The department will use the results of annual 90 Elgin waste audits to assess further progress on the reduction of plastic waste.

Target: Ongoing reduction in volume of single use plastic waste generated annually.

Internal Services
Actions supporting the Goal: Greening Government

Departments will use environmental criteria to reduce the environmental impact and ensure best value in government procurement decisions

  • Integrate environmental considerations into procurement management processes and controls
  • Use Supply Arrangements and Standing Offers that include environmental criteria whenever possible:
  • Ensure key officials include contribution to and support for the Policy on Green Procurement objectives in their performance evaluations.

FSDS: Incorporating environmental considerations into purchasing decisions motivates suppliers to reduce the environmental impact of the goods and services they deliver, and their supply chains.

SDG: Target 12.7

Starting Point:

  • When contracting, all procurement processes incorporate electronic bid solicitation, used scanning technology to issue contracts, promoted electronic invoicing.
  • The Department uses common-use procurement instruments that include environmental criteria whenever possible to procure IT hardware (i.e., desktops, computers, laptops and tablets).
  • The Department will purchase copy paper, commercial printing and/or envelopes containing a minimum 30% recycled content and certified to a recognized environmental standard to reduce the environmental impact of its production.The Director of Corporate Administrative Services, the Team Leader of Procurement and Material Management, and the Manager of Facilities all have individual performance objectives supporting green procurement and sustainable operations activities.

Performance Indicators:

  • Annual review of contracting records will provide the necessary detail to support progress on environmental contracting commitments.
  • Performance commitments of key officials.

Targets

  • Maintain paperless processes for all contracting activities.
  • Target is 90% of IT hardware procurements (i.e. laptops, tablets, desktops, and towers) to use common-use procurement instruments.
  • Target is that 90% of copy paper, commercial printing and/or envelopes meet established environmental criteria.
  • All key officials in Corporate Administrative Services include performance commitments that support green procurement or sustainable operations.

Internal Services

Actions supporting the Goal: Greening Government

Support for green procurement will be strengthened, including guidance, tools and training for public service employees

  • Continue to ensure that decisions makers, material management and specialists in procurement have the necessary training and awareness to support green procurement.

FSDS: Incorporating environmental considerations into purchasing decisions motivates suppliers to reduce the environmental impact of the goods and services they deliver, and their supply chains.

SDG: Target 12.7

Starting Point: 100% of current specialists in procurement and materiel management have completed training on green procurement.

Performance Indicator: Certificate of completion from CSPS.

Target: Maintain 100% completion rate.

Internal Services

Effective Action on Climate Change: A low-carbon economy contributes to limiting global average temperature rise to well below two degrees Celsius and supports efforts to limit the increase to 1.5 degrees Celsius

Responsible Minister: Ministers of Environment and Climate Change and Transport; supported by a whole-of-government approach to implementation

Effective Action on Climate Change FSDS target(s) FSDS contributing action(s) Corresponding departmental action(s) Contribution by each departmental action to the FSDS goal and target Starting point(s) Performance indicator(s) Target(s) Program(s) in which the departmental actions will occur
By 2030, reduce Canada's total GHG emissions by 30%, relative to 2005 emission levels Support businesses and Canadians in taking action to reduce greenhouse gas emissions Oversee the fuel charge component of the federal carbon pollution pricing system that applies in provinces and territories upon request, and in provinces and territories that do not have in place a carbon pricing system that meets the federal stringency requirements.

FSDS: The federal carbon pollution pricing system ensures that carbon pricing is implemented in all provinces and territories that do not have in place a carbon pricing system that meets the federal stringency requirements and thus encourages the use of clean technologies, which can reduce the amount of GHG emissions emitted.

SDG: Target 7.2, 12.2 and 13.2

Starting point: The Government released for consultation draft legislative proposals related to the federal carbon pricing system in January 2018.

Performance indicator: Carbon pricing applies broadly across Canada, in accordance with the federal stringency requirements, as assessed by Environment and Climate Change Canada.

Target: The Greenhouse Gas Pollution Pricing Act is maintained and Fuel Charge Regulations are implemented.

1.1: Economic and Fiscal Policy Framework

Zero-emission vehicles will represent 10% of new light-duty vehicle sales by 2025, 30% by 2030 and 100% by 2040

Support businesses and Canadians in taking action to reduce greenhouse gas emissions

Allow businesses to immediately expense investments in eligible zero-emission vehicles.

FSDS: Immediate expensing makes business investments in zero-emission vehicles less expensive by providing a tax incentive.

SDG: Target 13.2

Starting point: Budget 2019 introduced immediate expensing for new on-road zero-emission vehicles. Effective March 2, 2020, the Government has proposed to extend this incentive to include used on-road zero-emission vehicles as well as a variety of other new and used zero-emission automotive equipment and vehicles.

Performance indicator: Performance will be evaluated on the basis of the year-over-year change in new business investment in zero-emission vehicles and automotive equipment (Classes 54, 55 and 56) relative to the previous year. The first base year of data will be for 2019. Data for 2020, which will be needed for this comparison, will not be available until 2022.

1.1: Economic and Fiscal Policy Framework

Clean Energy: All Canadians have access to affordable, reliable and sustainable energy

Responsible Minister: Minister of Natural Resources

Clean Energy FSDS target(s) FSDS contributing action(s) Corresponding departmental action(s) Contribution by each departmental action to the FSDS goal and target Starting point(s) Performance indicator(s) Target(s) Program(s) in which the departmental actions will occur
By 2030, 90% and in the long term, 100% of Canada's electricity is generated from renewable and non-emitting sources Support voluntary action to reduce greenhouse gas and air pollutant emissions through clean energy generation and consumption Provide an incentive for investment in clean energy equipment available through the accelerated capital cost allowance for clean energy and energy conservation equipment (Class 43.1/43.2). Equipment that qualifies for Class 43.1 or 43.2 currently receives immediate expensing treatment.

FSDS: The accelerated capital cost allowance and immediate expensing for clean energy equipment makes investments in clean energy generation equipment less expensive by providing a tax incentive.

SDG: Targets 7.2 and 7.3

Starting point: In 20181, $2.5 billion was invested in Class 43.1/43.2 equipment.

Performance indicator: Performance will be evaluated on the basis of the year-over-year change in new investment in Class 43.1/43.2 equipment relative to 2018.

1.1: Economic and Fiscal Policy Framework

1 The fiscal period of a business may overlap more than one calendar year; when this is the case, the value of the investment is allocated to the calendar year in which the business' fiscal period ends.

Section 4: Integrating sustainable development

Economic analysis and considerations are the foundation of the Department's work. The Department uses Gender-Based Analysis Plus (GBA+) and Strategic Environmental Assessment (SEA) to analyse and develop policy and fiscal advice that takes into consideration social and environmental impacts. A GBA+ and an SEA are conducted for policies, plans and program proposals submitted by the Department to Cabinet or the Minister of Finance for decision.

The Department requires a GBA+ for all funding proposals and incorporates this analysis in the advice it provides to the Minister of Finance for funding decision- making. The GBA+ template for the Budget 2020 process asked departments to identify linkages to relevant Sustainable Development Goals (SDG). The Government also publicly reports on GBA+ impacts of proposals announced in budgets.

As per the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, an SEA for a policy, plan or program proposal includes an analysis of the impacts of the given proposal on the environment, including on relevant FSDS goals and targets. For policy, plan or program proposals developed by the Department, and submitted to Cabinet or the Minister of Finance, a preliminary scan is conducted to determine whether the proposal is likely to cause important environmental effects, including impacts on FSDS goals and targets. If the scan concludes that such effects are likely, then a full SEA is conducted to analyze the scope and nature of the proposal's environmental effects and determine possible measures to reduce negative environmental effects and increase positive environmental effects. During the 2019-20 reporting cycle, the Department considered the environmental effects of 152 proposals, including 12 that were subject to a full SEA. The Department will continue to ensure that its SEA process includes consideration of FSDS goals and targets as well as the impacts of proposals on the Government's 2030 and 2050 climate mitigation commitments.

Departments and agencies that are developing a proposal seeking funding are required to complete an SEA that respects the standards established by the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals. The Department of Finance Canada in turn strives to ensure that the environmental considerations identified through an SEA support the Minister of Finance's decision-making on funding.

Public statements on the results of the Department of Finance Canada's assessments are made public when an initiative has undergone a full SEA (see here). The purpose of the public statement is to demonstrate that the environmental effects, including the impacts on achieving the FSDS goals and targets, of the approved policy, plan or program have been considered during proposal development and decision-making.

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