Quarterly Financial Report - Statement outlining results, risks and significant changes in operations, personnel and programs - For the quarter ended June 30, 2024

Introduction

This quarterly 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 Report. This quarterly financial report should be read in conjunction with the Main Estimates and previous Quarterly Financial Reports. For more information on PCO, please visit PCO's website.

This quarterly report has not been subject to an external audit or review but has been shared with the PCO Departmental Audit Committee and it reflects the committee members' comments.

Mandate

PCO supports the development and implementation of the Government of Canada's policy and legislative agendas, coordinates responses to issues facing the Government and the country and supports the effective operation of Cabinet. PCO is led by the Clerk of the Privy Council, who also serves as Secretary to the Cabinet and the Head of the Public Service.

PCO serves Canada and Canadians by providing advice and support to the Prime Minister, portfolio ministers, and Cabinet.

PCO has three main roles:

  1. Provide professional non-partisan advice to the Prime Minister, portfolio ministers, Cabinet and Cabinet committees on matters of national and international importance.
  2. Support the smooth functioning of the Cabinet decision-making process and facilitate the implementation of the Government’s agenda.
  3. Foster a high-performing and accountable Public Service.

Basis of presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes PCO’s spending authorities granted by Parliament and those used by the department, consistent with the 2024-25 Main Estimates and Supplementary Estimates (A). This quarterly report has been prepared using a special purpose financial reporting framework (expenditure basis) designed to meet financial information needs with respect to the use of spending authorities.

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.

PCO uses the full accrual method of accounting to prepare and present its annual departmental financial statements1 that are part of the departmental performance reporting process. The spending authorities voted by Parliament remain on an expenditure basis. 

Highlights of fiscal quarter and fiscal year to date results

This section highlights the significant items that contributed to the net increase or decrease in authorities available for the year and actual expenditures for the quarter ended June 30, 2024.

PCO spent approximately 23% of its authorities available for use at the end of the first quarter of 2024‑25, compared to 23% at the end of the same quarter of 2023-24 (see graph 1 below).

Graph 1: Comparison of total authorities available for use and total net budgetary expenditures as of Q1 2024-25 and 2023-24

Graph  1
Text version - Graph 1
$ Millions
  2024-25 2023-24
Total authorities available for use 243.4 210.9
Q1 expenditures 55.2 48.0
 

Significant changes to authorities

Further to graph 2 below and Annex A, presented at the end of this document, as at June 30, 2024, PCO has authorities available for use of $243.4 million in 2024-25 compared to $210.9 million as of June 30, 2023, for a net increase of $32.4 million or 15%. The net increase in authorities of $32.4 million is mainly explained by funding related to the Public Inquiry into Foreign Interference in Federal Electoral Processes and Democratic Institutions and an increase in funding for compensation adjustments. This is partially offset by the sunset funding for the Public Order Emergency Commission and the reduction of funding announced in Budget 2023. Commissions of Inquiry are independent organizations but are reported under PCO’s financial statements.

Graph 2: Variance in authorities as at June 30, 2024

Graph 2
Text version - Graph 2
$ Millions
  Vote 1 - Operating Statutory Total budgetary authorities
Fiscal year 2024-25 total available for use for the year ended March 31, 2025 221.1 22.3 243.4
Fiscal year 2023-24 total available for use for the year ended March 31, 2024 188.6 22.3 210.9
 

Significant changes to expenditures

Year-to-date net expenditures recorded to the end of the first quarter increased by $7.2 million, or 15%, from the same period of the previous year (from $48.0 million for 2023-24 to $55.2 million for 2024-25). Table 1 below presents budgetary expenditures by standard object.

Table 1

(in thousands of dollars)
Material Variances to Expenditures by Standard Object Fiscal year 2024-25
Expended during the quarter ended June 30, 2024
Fiscal year 2023-24
Expended during the quarter ended June 30, 2023
Variance $ Variance %
Personnel 46,159 40,176 5,983 15%
Transportation and communications 1,712 1,117 595 53%
Information 1,162 1,059 103 10%
Professional and special services 5,726 5,088 638 13%
Rentals 1,950 1,596 354 22%
Repair and maintenance 87 80 7 9%
Utilities, materials and supplies 78 74 4 5%
Acquisition of machinery and equipment 943 808 135 17%
Transfer payments 279 42 237 564%
Other subsidies and payments 300 342 (42) (12%)
Total gross budgetary expenditures 58,397 50,380 8,017 16%
Less revenues netted against expenditures (3,151) (2,330) (821) 35%
Total net budgetary expenditures  * 55,246 48,049 7,197 15%
* Details may not add to totals due to rounding

Personnel

The overall increase of $6.0 million in personnel spending is mainly due to compensation adjustments related to pay rate increases and the establishment of the Public Inquiry into Foreign Interference in Federal Electoral Processes and Democratic Institutions on September 7, 2024.

Transportation and communications

The increase of $0.6 million in transportation and communications relates mainly to travel costs for the Public Inquiry into Foreign Interference in Federal Electoral Processes and Democratic Institutions established on September 7, 2024.

Revenues netted against expenditures

The increase of $0.8 million for revenues netted against expenditures is mainly due to more recoveries in the first quarter of 2024-25 for internal services such as financial management, human resources and information technology services for the Secure Communications for National Leadership initiative provided to other departments, compared to the same period in 2023-24.

Risks and uncertainties

The principal financial risks to PCO lie in the need to reallocate departmental resources to deal with issues that may emerge unexpectedly given the increasing horizontality, complexity and scope of the work done at PCO. As part of its coordinating role, PCO must be able to address emerging issues on short notice, and either manage the necessary expenditures within its own spending authorities, or cash manage until increased spending authorities are approved.

PCO has identified other key risks that could have an impact on the achievement of its mandate and its financial situation. These risks revolve around areas such as threats to security (cybersecurity/insider/physical), information management, increasing horizontality, complexity and scope of work, and the recruitment and retention of employees.

The department will continue to effectively manage its existing and emerging risks through cooperation, engagement and sharing of expertise and best practices with other federal departments and agencies, provincial and territorial governments, as well as community partners, the private sector, international counterparts, and its Department Audit Committee.

Significant changes in relation to operations, personnel and programs

In April 2024, Paul Halucha, Deputy Secretary to the Cabinet (Clean Growth), was concurrently appointed Deputy Minister of Public Lands and Housing.

There have not been any significant changes in relation to operations and programs during the quarter.

Approval by senior officials:

John Hannaford
Clerk of the Privy Council and
Secretary to the Cabinet

Matthew Shea
Assistant Secretary to the Cabinet
Ministerial Services and Corporate Affairs
and Chief Financial Officer

Ottawa, Canada
Thursday August 29, 2024

Annexes A & B

Annex A

Privy Council Office
Quarterly Financial Report
For the quarter ended June 30, 2024
Statement of authorities (unaudited) (note 2)

(in thousands of dollars)
Expenditures/Authorities Fiscal year 2024-2025 Fiscal year 2023-2024
Total available for use for the year ending
March 31, 2025 (note 1)
Used during the quarter ended
June 30, 2024
Year-to-date used at quarter–end Total available for use for the year ending
March 31, 2024 (note 1)
Used during the quarter ended
June 30, 2023
Year-to-date used at quarter–end
Vote 1 - Net operating expenditures 221,058 49,648 49,648 188,648 42,453 42,453
Budgetary statutory authorities  
Contributions to employee benefits plans 21,891 5,473 5,473 21,906 5,477 5,477
Prime Minister - Salary and motor car allowance 205 51 51 194 49 49
Leader of the Government in the House of Commons - Salary and motor car allowance 99 49 49 95 24 24
President of the King's Privy Council for Canada and the Minister of Emergency Preparedness - Salary and motor car allowance - - - 95 24 24
President of the King's Privy Council for Canada and Minister of Emergency Preparedness and Minister responsible for the Pacific Economic Development Agency of Canada - Salary and motor car allowance 99 25 25 - - -
Minister of Intergovernmental Affairs, Infrastructure and Communities - Salary and motor car allowance - - - - 24 24
Total budgetary authorities 243,351 55,246 55,246 210,937 48,049 48,049
Total authorities 243,351 55,246 55,246 210,937 48,049 48,049
Note 1: Includes authorities available for use and granted by Parliament at quarter-end for each respective fiscal year (Including Frozen Allotments).
Note 2: Details may not add to totals due to rounding.

Annex B

Privy Council Office
Quarterly Financial Report
For the quarter ended June 30, 2024
Departmental budgetary expenditures by Standard Object (unaudited) (note 2)

(in thousands of dollars)
Departmental budgetary expenditures Fiscal year 2024-2025 Fiscal year 2023-2024
Planned expenditures for the year ending
March 31, 2025 (note 1)
Expended during the quarter ended
June 30, 2024
Year-to-date used at quarter–end Planned expenditures for the year ending
March 31, 2024 (note 1)
Expended during the quarter ended
June 30, 2023
Year-to-date used at quarter–end
Budgetary expenditures  
Personnel 180,924 46,159 46,159 166,409 40,176 40,176
Transportation and communications 5,285 1,712 1,712 4,997 1,117 1,117
Information 5,217 1,162 1,162 4,133 1,059 1,059
Professional and special services 41,195 5,726 5,726 23,687 5,088 5,088
Rentals 5,721 1,950 1,950 6,104 1,596 1,596
Repair and maintenance 1,787 87 87 2,029 80 80
Utilities, materials and supplies 569 78 78 444 74 74
Acquisition of machinery and equipment 8,997 943 943 11,637 808 808
Transfer payments 2,248 279 279 - 42 42
Other subsidies and payments 34 300 300 - 342 342
Total gross budgetary expenditures 251,979 58,397 58,397 219,440 50,380 50,380
Less revenues netted against expenditures
   Revenues (note 3)
(8,628) (3,151) (3,151) (8,502) (2,330) (2,330)
Total revenues netted against expenditures (8,628) (3,151) (3,151) (8,502) (2,330) (2,330)
Total net budgetary expenditures 243,351 55,246 55,246 210,937 48,049 48,049
Note 1: Includes authorities available for use and granted by Parliament at quarter-end for each respective fiscal year (Including Frozen Allotments).
Note 2: Details may not add to totals due to rounding.
Note 3: PCO's revenues are sourced from the provision of intelligence analysis training and the provision of internal support services to other departments.

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