Public Health Agency of Canada Quarterly Financial Report - For the quarter ended December 31, 2020

Table of contents

1. Introduction

This quarterly financial report has been prepared by management as required by section 65.1 of the Financial Administration Act, 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 Supplementary Estimates. Please note that this quarterly financial report has not been subject to an external audit or review.

1.1 Authority, Mandate and Program

The Public Health Agency of Canada was created within the federal Health Portfolio in September 2004. The core mandate of the Agency is to deliver on the Government of Canada's commitment to increase its focus on public health in order to help protect and improve the health and safety of all Canadians and to contribute to strengthening public health capacities across Canada.

The Agency has the responsibility to:

The Agency aims to achieve a strategic outcome of protecting Canadians and empowering them to improve their health by providing strategic policy advice and support to the Minister of Health on a range of Core Responsibilities, including:

The Agency also delivers a number of grant and contribution programs related to these programs.

Further information on the mandate, roles, responsibilities and program of the Agency can be found in the 2020-21 Departmental Plan and the 2020-21 Main Estimates.

1.2 Basis of Presentation

This quarterly report has been prepared using an expenditure basis of accounting. The accompanying Statement of Authorities (Section 6.0) includes the Agency's spending authorities granted by Parliament, or received from Treasury Board Central Votes, and those used by the Agency consistent with the Main Estimates and Supplementary Estimates for the 2020-21 fiscal year. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities

The authority of Parliament is required before moneys 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 Agency uses the full 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.

2. Highlights of Fiscal Quarter Results

Both authorities and expenditures have significantly increased in order to address the COVID-19 pandemic. The following graph provides a comparison of the Agency's net budgetary authorities and expenditures.

Comparison of Budgetary Authorities and Expenditures as of December 31, 2019 and December 31, 2020
Figure - Text description

The graph above provides a comparison of the net budgetary authorities and expenditures as of December 31, 2020 and December 31, 2019 for the Agency's combined Vote 1, Vote 5, Vote 10 and Statutory Votes. As of December 31, 2020, PHAC had a total of $14,988.1 million in authorities available for spending compared to $650.3 million on December 31, 2019. PHAC's year-to-date expenditures as of December 31, 2020 were $5,886.2 million compared to $439.0 million on December 31, 2019.

2.1 Significant Changes to Authorities

When compared to the third quarter of 2019-20, the authorities available for spending for the quarter ending December 31st, 2020, have increased by $14,337.8 million or 2,205 percent, from $650.3 million to $14,988.1 million. This increase in Authorities is due to the following:

Statutory Authority - Public Health Events of National Concern Payments Act to address the COVID-19 Pandemic

Increase of $11,034.7 million in Statutory Authority related to the Public Health Events of National Concern Payments Act to address the COVID-19 Pandemic:

Vote 1 - Operating

Increase of $3,179.7 million (900 percent) in Operating spending authorities (Vote 1) mainly due to funding received in response to the COVID-19 pandemic pursuant to the Public Health Events of National Concern Payments Act for the following measures:

Offset by:

These two reprofiles also reduced the total Authorities available for use from the previous quarterly report (second quarter of 2020-21).

Vote 5 - Capital

Increase of $5.6 million (61 percent) in Capital spending authorities (Vote 5) mainly due to funding received in response to the COVID-19 pandemic pursuant to the Public Health Events of National Concern Payments Act for the following measures:

Vote 10 - Grants and Contributions

Increase of $118.1 million (48 percent) in Grants and Contributions spending authorities (Vote 10), mainly due to funding received in response to the COVID-19 pandemic pursuant to the Public Health Events of National Concern Payments Act for the following measures:

Offset by:

2.2 Authorities Used Analysis

In the third quarter of 2020-21, total budgetary expenditures amounted to $2,469.7 million compared to $128.4 million reported in the same quarter of 2019-20, which represents an increase of $2,341.3 million or 1,823 percent.

Authorities used in Vote 1, Operating expenditures, decreased by $85.3 million compared to the same quarter last year representing a variance of approximately 104 percent between the two years. This decrease is mainly due to a timing difference in the reallocation of costs associated with COVID-19.

Authorities used in Vote 5, Capital expenditures, increased by $0.7 million compared to the same quarter last year representing a variance of approximately 51 percent between the two years. This increase is mainly due to the acquisition of laboratory and testing equipment for the National Microbiology Laboratory.

Authorities used in Vote 10, Grants and Contributions expenditures, decreased by $2.9 million compared to the same quarter last year representing a variance of approximately 8 percent between the two years. The decrease is mainly due to the sunset of funding for the Centre for Aging and Brain Health Innovation.

Statutory Authorities used increased by $2,431.4 million in compared to the same quarter last year. The increase is mainly due to Canada's response to the COVID-19 pandemic for the purchase of personal protective equipment, medical and testing supplies pursuant to the Public Health Events of National Concern Payments Act.

3. Risks and Uncertainty

The dominant financial risks faced by the Agency relate to the need to respond to events such as the COVID-19 pandemic. In order to manage these financial risks and uncertainties, the Government of Canada has introduced legislation including the Public Health Events of National Concern Payments Act to ensure mechanisms are in place to address the funding needs associated with the COVID-19 pandemic response or any other public health event of national concern. Additionally, as the Agency navigates through the uncertainty associated with the new COVID-19 operational reality, financial management practices and strategies are in place to assess, monitor and mitigate to the extent possible the impacts of these risks.

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

There continues to be significant changes in relation to operations, personnel and programs as the Agency plays its important role in the fight against the COVID-19 pandemic. This role has required the Agency to rapidly scale up and sustain its operational response capacities and to take on new priorities and work. In light of an extremely dynamic environment during the pandemic, the Agency will continue to strategically assess and tailor its COVID-19 response to best meet the needs of Canadians.

5. Approval by Senior Officials

Approved by:

Iain Stewart, President
Public Health Agency of Canada
Ottawa, Canada
Date:
Martin Krumins, Chief Financial Officer
Public Health Agency of Canada
Ottawa, Canada
Date:

6. Statement of Authorities (unaudited)

Public Health Agency of Canada
For the quarter ended December 31, 2020

Statement of authorities (unaudited)
(in thousands of dollars) Fiscal year 2020-2021 Fiscal year 2019-2020
Total available for use for the year ending March 31, 2021Footnote 1 Used during the quarter ended December 31, 2020Footnote 2 Year to date used at quarter-end Total available for use for the year ended March 31, 2021Footnote 1 Used during the quarter ended December 31, 2019 Year to date used at quarter-end
Vote 1 - Operating expenditures 3,533,147 -3,536 265,306 353,429 81,789 247,333
Vote 5 - Capital expenditures 14,707 1,935 2,227 9,157 1,279 4,022
Vote 10 - Grants and contributions 362,366 32,498 149,689 244,260 35,391 160,537
Statutory Authorities
Statutory - Contributions to employee benefit plans 29,766 7,383 22,149 29,912 7,412 22,235
Statutory - Spending of proceeds from the disposal of surplus Crown assets 1 0 0 90 0 0
Statutory - Refunds of amounts credited to revenues in previous years 0 0 0 9 8 9
Statutory - Spending of revenues pursuant to section 4.2 of the Department of Health Act 13,413 0 2,121 13,413 2,532 4,952
Statutory - Payments related to Public Health Events of National Concern and Income support 11,034,719 2,431,382 5,444,650 0 0 0
Total Statutory Authorities 11,077,899 2,438,765 5,468,920 43,424 9,952 27,196
Total Authorities 14,988,119 2,469,662 5,886,142 650,270 128,411 439,088
Footnote 1

Note 1: Includes only authorities available for use and granted by Parliament at quarter end.

Return to footnote 1 referrer

Footnote 2

Note 2: The negative balance ($-3,536) is explained by a reallocation of expenditures ($86M) during Q3 From Vote 1 - Operating expenditures to Statutory Payments related to Public Health Events of National Concern and Income Support. These expenditures were originally recorded during Q2.

Return to footnote 2 referrer

7. Agency Budgetary Expenditures by Standard Object (unaudited)

Public Health Agency of Canada
For the quarter ended December 31, 2020

Table 1: Departmental budgetary expenditures by Standard Object (unaudited)
(in 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 273,820 74,343 200,203 253,789 68,642 172,073
Transportation and communications 758,356 24,905 46,600 7,236 2,213 5,500
Information 1,250,289 1,283 63,440 15,872 1,419 14,182
Professional and special services 5,709,128 41,637 117,332 77,380 6,726 54,219
Rentals 191,488 16,244 53,108 2,095 564 2,641
Repair and maintenance 192,456 620 2,474 2,872 660 2,723
Utilities, materials and supplies 6,113,616 2,210,758 4,919,590 23,977 10,519 19,289
Acquisition of lands, buildings and works 0 6 6 0 -12 177
Acquisition of machinery and equipment 52,149 10,270 253,516 12,666 2,055 5,680
Transfer payments 443,574 37,732 175,016 244,260 35,391 160,537
Other subsidies and payments 3,893 52,068 55,392 10,773 401 2,569
Total gross budgetary expenditures 14,988,769 2,469,866 5,886,677 650,920 128,578 439,590
Less revenues netted against expenditures:
Services Non-Regulatory 650 204 535 650 167 502
Total Revenues netted against expenditures 650 204 535 650 167 502
Total net budgetary expenditures 14,988,119 2,469,662 5,886,142 650,270 128,411 439,088

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