Public Health Agency of Canada Quarterly Financial Report For the quarter ending June 30, 2022

Table of Contents

• 1. Introduction
  • 1.1 Authority, Mandate and Program
  • 1.2 Basis of Presentation
• 2. Highlights of fiscal quarter results
  • 2.1 Significant changes to authorities
  • 2.2 Authorities used analysis
• 3. Risks and Uncertainty
• 4. Significant changes in relation to operations, personnel and programs
• 5. Approval by Senior Officials
• 6. Statement of Authorities (unaudited)
• 7. Agency budgetary expenditures by Standard Object (unaudited)

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:

• contribute to the prevention of disease and injury, and the promotion of health;
• enhance the quality and quantity of surveillance data and expand the knowledge of disease and injury in Canada;
• provide federal leadership and accountability in managing national public health events;
• strengthen intergovernmental collaboration on public health and facilitate national approaches to public health policy and planning; and
• serve as a central point for sharing Canada's expertise with international partners and to translate international knowledge and approaches to inform and support Canada's public health priorities and programs.

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:

• Health Promotion and Chronic Disease Prevention;
• Infectious Disease Prevention and Control; and
• Health Security.

The Agency also delivers a number of grants and contributions related to these programs.

Further information on the mandate, roles, responsibilities and program of the Agency can be found in the 2022-23 Departmental Plan and the 2022-23 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 2022-23 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

The following graph provides a comparison of the Agency's net budgetary authorities and expenditures.

Figure 1 - Text description

The graph above provides a comparison of the net budgetary authorities and expenditures as of June 30, 2022 and June 30, 2021 for the Agency's combined Vote 1, Vote 5, Vote 10 and Statutory Votes. As of June 30, 2022, PHAC had a total of $10,319.5 million in authorities available for spending compared to $13,147.5 million on June 30, 2021. PHAC's year-to-date expenditures as of June 30, 2022 were $883.3 million compared to $1,096.5 million on June 30, 2021.

2.1 Significant changes to authorities

Authorities available (in millions of dollars)	2021-22	2022-23	Variance
Vote 1 – Operating expenditures	12,120	9,281	-2,839
Vote 5 – Capital expenditures	101	24	-77
Vote 10 – Grants and contributions	844	634	-210
Statutory	82	380	298
Total authorities	13,147	10,319	-2,828

The Agency's total authorities available for use decreased from $13,147.5 million to $10,319.5 million compared to the first quarter of 2021-22. This year-to-date reduction of $2,828.0 million is explained by decreases in funding for the following initiatives:

• $1,646.1 million for the procurement of vaccines and deployment operations;
• $1,576.3 million for the procurement of personal protective equipment and medical equipment;
• $969.0 million for border and travel measures and isolation sites;
• $481.5 million for innovative research and procurement of testing technologies related to the pandemic;
• $444.2 million for the Safe Restart Agreement for federal investments in testing, contact tracing and data management;
• $140.0 million for strategic international partnerships for the distribution of vaccines;
• $82.1 million for surge capacity;
• $80.0 million for additional human health resources;
• $75.9 million to strengthen pre-clinical and medical countermeasures in Canada; and
• $95.3 million for various other initiatives.

The decreases are offset by increases in the following initiatives:

• $2,371.9 million for therapeutics;
• $300.0 million for proof of vaccination credentials;
• $40.4 million for mental health support related to COVID-19 including support for distress centers;
• $20.0 million for the Indigenous Early Learning and Child Care program; and
• $31.2 million for various other initiatives.

2.2 Authorities used analysis

Year-to-date expenditures (in millions of dollars)	2021-22	2022-23	Variance
Vote 1 – Operating expenditures	951	707	-243
Vote 5 – Capital expenditures	2	0	-1
Vote 10 – Grants and contributions	128	159	31
Statutory	16	16	0
Total year-to-date expenditures	1,097	883	-213

Total net budgetary expenditures amounted to $883.3 million as of June 30, 2022, as compared to $1,096.5 million in 2021-22. This represents a year-to-date decrease of $213.2 million primarily due to the following events:

• Quarterly spending for Utilities, Materials and Supplies for 2022-23 decreased by $187.3 million compared to the first quarter of 2021-22. This variance is primarily due to reduced spending in 2022-23 related to procurement of vaccines, personal protective equipment, COVID-19 test kits and test supplies. This is offset by an increase in spending for COVID-19 therapeutics in the first quarter of 2022-23.
• Quarterly spending for professional and special services decreased by $36.1 million for 2022-23 compared to the first quarter of 2021-22. This variance is primarily due to reduced spending in 2022-23 related to borders testing, travel and quarantine measures.
• Quarterly spending for information decreased by $27.5 million for 2022-23 compared to the first quarter of 2021-22. This variance is primarily due to timing differences and a reduction in spending for COVID-19 public education campaigns.
• Quarterly spending for transfer payments increased by $30.8 million for 2022-23 compared to the first quarter of 2021-22. The variance is primarily related to increased spending to support activities related to post traumatic stress disorder and trauma due to COVID-19, the immunization partnership fund and the Community Action Program for Children. There is also reduced spending in 2022-23 related to border testing measures.
• Quarterly spending for personnel increased by $9.6 million compared to the same quarter in 2021-22 primarily as a result of the Agency's human resources growth to sustain its pandemic response.

3. Risks and Uncertainty

The dominant financial risks faced by the Agency relate to the nature of its mandate and the need to respond to events such as the COVID-19 pandemic. In order to address financial risks and uncertainties, the Government of Canada has provided significant temporary funding to support the Agency's response to the COVID-19 pandemic. As the Agency navigates through the uncertainty associated with the 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:

Dr. Harpreet S. Kochhar,
President
Public Health Agency of Canada
Ottawa, Canada
Date:

Jaime Caceres,
Acting, Chief Financial Officer
Public Health Agency of Canada
Ottawa, Canada
Date:

6. Statement of Authorities (unaudited)

	Fiscal year 2022-2023			Fiscal year 2021-2022
(in thousands of dollars)	Total available for use for the year ending March 31, 2023Footnote 1	Used during the quarter ended June 30, 2022	Year to date used at quarter-end	Total available for use for the year ended March 31, 2022Footnote 2	Used during the quarter ended June 30, 2021	Year to date used at quarter-end
Vote 1 - Operating expenditures	9,281,009	707,470	707,470	12,119,974	950,609	950,609
Vote 5 - Capital expenditures	24,150	479	479	101,100	1,509	1,509
Vote 10 - Grants and contributions	634,303	158,853	158,853	844,334	128,043	128,043
Statutory Authorities
Statutory - Contributions to employee benefit plans - Program	65,933	16,483	16,483	68,639	16,362	16,362
Statutory - Spending of amounts equivalent to proceeds from disposal of surplus moveable Crown assets	662	0	0	38	4	4
Statutory - Spending of revenues pursuant to section 4.2 of the Department of Health Act	13,413	0	0	13,413	0	0
Statutory- Payments in connection with Economic and Fiscal Update Implementation Act, 2021	300,000	0	0	0	0	0
Total authorities	10,319,470	883,285	883,285	13,147,498	1,096,527	1,096,527
Footnotes Footnote 1 Includes only authorities available for use and granted by Parliament at quarter end. Return to footnote 1 referrer Footnote 2 Amounts in this column include frozen and reprofile funding that was originally excluded in the Quarterly Financial Report ending June 30, 2021. Return to footnote 2 referrer

7. Agency budgetary expenditures by Standard Object (unaudited)

	Fiscal year 2022-2023			Fiscal year 2021-2022
(in thousands of dollars)	Planned expenditures for the year ending March 31, 2023 Footnote 1	Expended during the quarter ended June 30, 2022	Year to date used at quarter-end	Planned expenditures for the year ending March 31, 2022 Footnote 2	Expended during the quarter ended June 30, 2021	Year to date used at quarter-end
Expenditures:
Personnel	514,693	92,961	92,961	530,800	83,319	83,319
Transportation and communications	35,004	2,416	2,416	67,443	3,508	3,508
Information	20,786	5,969	5,969	48,907	33,472	33,472
Professional and special services	681,974	66,338	66,338	1,288,223	102,449	102,449
Rentals	2,607	14,541	14,541	36,673	13,138	13,138
Purchased repair and maintenance	2,623	573	573	4,313	1,008	1,008
Utilities, materials and supplies	8,093,317	530,198	530,198	9,776,944	717,502	717,502
Acquisition of lands, buildings and works	0	12	12	68,984	0	0
Acquisition of machinery and equipment	32,761	1,057	1,057	477,802	2,831	2,831
Transfer payments	934,303	158,853	158,853	844,334	128,043	128,043
Other subsidies and payments	2,052	10,633	10,633	3,725	11,443	11,443
Total gross budgetary expenditures	10,320,120	883,551	883,551	13,148,148	1,096,713	1,096,713
Less revenues netted against expenditures:
Services of a Non-Regulatory Nature	650	266	266	650	186	186
Total Revenues netted against expenditures	650	266	266	650	186	186
Total net budgetary expenditures	10,319,470	883,285	883,285	13,147,498	1,096,527	1,096,527
Footnotes Footnote 1 Includes only authorities available for use and granted by Parliament at quarter end. Return to footnote 1 referrer Footnote 2 Amounts in this column include frozen and reprofile funding that was originally excluded in the Quarterly Financial Report ending June 30, 2021. Return to footnote 2 referrer