Public Health Agency of Canada quarterly financial report - For the quarter ended September 30, 2020

• 1.0 Introduction
• 1.1 Authority, Mandate and Program
  • 1.2 Basis of Presentation
• 2.0 Highlights of Fiscal Quarter Results
  • 2.1 Significant Changes to Authorities
    • Public Health Events of National Concern Payments Act to address the COVID-19 Pandemic
    • Vote 1 – Operating Authorities
    • Vote 5 – Capital Authorities
    • Vote 10 - Grants and Contributions (G&C)
  • 2.2 Significant Changes to Expenditures
    • Public Health Events of National Concern Payments Act to address the COVID-19 Pandemic
    • Vote 1 – Operating Expenditures
    • Vote 5 – Capital Expenditures
    • Vote 10 - Grants and Contributions (G&C)
• 3.0 Risks and Uncertainty
• 4.0 Significant Changes in Relation to Operations, Personnel and Programs
• 5.0 Approval by Senior Officials
• 6.0 Statement of Authorities (unaudited)
• 7.0 Agency Budgetary Expenditures by Standard Object (unaudited)

1.0 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 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.

2.0 Highlights of Fiscal Quarter Results

This section highlights the significant items that contributed to the net increase in resources available for the year, as well as a net increase in actual expenditures for the second quarter of 2020-21, ending September 30, 2020.

The following graph provides a comparison of the net budgetary authorities and expenditures as of September 30, 2019 and September 30, 2020 for the Department's combined Vote 1, Vote 5, Vote 10 and Statutory Authorities.

As of September 30, 2020, the Agency had a total of $20,899.6 million in authorities available for spending compared to $642.3 million on September 30, 2019. The Agency's year-to-date expenditures as of September 30, 2020 were $3,416.5 million compared to $310.6 million on September 30, 2019. Both authorities and expenditures have significantly increased in order to address the COVID-19 pandemic.

2.1 Significant Changes to Authorities

When compared to the second quarter of the previous fiscal year, the authorities available for spending for the year have increased by $20,257.3 million or 3,154 percent, from $642.3 million to $20,899.6 million. This change in authorities is comprised of an increase of $20,261.5 million related to initiatives funded under the Public Health Events of National Concern Payments Act to address the COVID-19 pandemic as well as an increase of $11.2 million in Operating spending authorities (Vote 1), a decrease of $3.6 million in Capital spending authorities (Vote 5), and a decrease of $11.6 million in Grants and contributions spending authorities (Vote 10).

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

The Agency's Authorities increased by $20,261.5 million, mainly due to:

• $1,800 million to acquire protective gear and medical equipment pursuant to the Public Health Events of National Concern Payments Act;
• $200 million to fund the Serosurveillance Consortium pursuant to the Public Health Events of National Concern Payments Act;
• $177 million to fund Canada's initial response to COVID-19 pursuant to the Public Health Events of National Concern Payments Act;
• $74.7 million to fund Canada's enhanced response to COVID-19 pursuant to the Public Health Events of National Concern Payments Act;
• $7.5 million to fund the Kids Help Phone pursuant to the Public Health Events of National Concern Payments Act;
• $9,200 million to fund medical research and vaccine development pursuant to the Public Health Events of National Concern Payments Act;
• $5,549 million to acquire protective gear and medical equipment pursuant to the Public Health Events of National Concern Payments Act;
• $1,319 million to acquire Medical Countermeasures in Canada pursuant to the Public Health Events of National Concern Payments Act;
• $942.4 million to fund the Safe Restart Agreement for federal investments in testing, contact tracing and data management pursuant to the Public Health Events of National Concern Payments Act;
• $508.8 million to fund the border and travel measures and isolation sites pursuant to the Public Health Events of National Concern Payments Act;
• $344.6 million to fund the development of a COVID-19 vaccine pursuant to the Public Health Events of National Concern Payments Act;
• $97.7 million to strengthen pre-clinical and material countermeasures in Canada pursuant to the Public Health Events of National Concern Payments Act;
• $18.8 million to fund additional measures to support Canada's COVID-19 response for Influenza and Pneumococcal Vaccine Procurement pursuant to the Public Health Events of National Concern Payments Act;
• $12.8 million to boost Canada's capacity to manufacture and deploy a future COVID-19 vaccine pursuant to the Public Health Events of National Concern Payments Act;
• $8.8 million to fund a safe restart in Indigenous communities pursuant to the Public Health Events of National Concern Payments Act.

Vote 1 - Operating Authorities

The Agency's Vote 1 increased by $11.2 million or 3 percent, mainly due to:

• Funding to establish capacity for domestic production of personal protective equipment (Supplementary Estimates A);
• Funding for the National Medical Research Strategy (Supplementary Estimates A);
• Change in funding for various new and ongoing programs including the implementation of the National Dementia Strategy and additional funding to respond to the drug overdose crisis in Canada;
• Funding from the Operating Budget Carry Forward.

Offset by:

• 1/12 of the Main Estimates not yet appropriated by Parliament.

Vote 5 - Capital Authorities

The Agency's Vote 5 decreased by $3.6 million or 40 percent, mainly due to:

• Funding from the Capital Budget Carry Forward.

Offset by:

• 3/12 of the Main Estimates not yet appropriated by Parliament.

Vote 10 - Grants and Contributions (G&C)

The Agency's Vote 10 decreased by $11.6 million or 5 percent, mainly due to:

• A decrease in funding due to the sunset of the Centre for Aging and Brain Health Innovation;
• 1/12 of the Main Estimates not yet appropriated by Parliament.

Offset by:

• An increase in funding for the National Dementia Strategy;
• An increase in funding for the Dementia Community Investment;
• A change in funding for the Indigenous Early Learning and Child Care Transformation Initiative;
• Funding to address the public health aspects of challenges faced by black Canadians;
• Funding to respond to the drug overdose crisis in Canada;
• Funding to support the Métis Nation in gathering health data and developing a strategy.

2.2 Significant Changes to Expenditures

The second quarter expenditures increased by $1,367.4 million or 994 percent, in 2020-21, compared to 2019-20, from $137.5 million to $1,504.9 million.

This overall increase in spending is mainly due to:

• An increase of $1,272.6 million in spending under the Public Health Events of National Concern Payments Act to address the COVID-19 pandemic;
• An increase of $114.8 million or 113% in Vote 1 - Operating expenditures;
• A decrease of $6.4 million or 293% in Vote 5 - Capital expenditures; and
• A decrease of $13.3 million or 55% in Vote 10 - Grants and contributions expenditures

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

The Agency's expenditures in the second quarter of 2020-21 increased by $1,272.6 million mainly due to Canada's response to the COVID-19 pandemic including for the purchase of personal protective equipment, medical and testing supplies which was funded pursuant to the Public Health Events of National Concern Payments Act to address the COVID-19 pandemic.

Vote 1 - Operating Expenditures

The Agency's Vote 1 second quarter 2020-21 expenditures increased by $114.8 million over the same quarter in 2019-20 mainly due to costs associated with the COVID-19 response.

Vote 5 - Capital Expenditures

The Agency's Vote 5 second quarter 2020-21 expenditures decreased by $6.4 million over the same quarter in 2019-20 mainly due to Expenditures related to COVID-19 measures previously charged against Vote 5 that have been corrected and charged against the Public Health Events of National Concern Payments Act.

Vote 10 - Grants and Contributions (G&C)

The Agency's Vote 10 second quarter 2020-21 expenditures decreased by $13.3 million over the same quarter in 2019-20 mainly due to the sunset of funding for the Centre for Aging and Brain Health Innovation.

3.0 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 current COVID-19 pandemic.

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.

4.0 Significant Changes in Relation to Operations, Personnel and Programs

There have been significant changes in relation to operations, personnel and programs during the first quarter of 2020-21 due to the Public Health Events of National Concern Payments Act COVID-19 pandemic, which has required the Public Health Agency of Canada to scale up its response capacities.

5.0 Approval by Senior Officials

Approved by:

6.0 Statement of Authorities (unaudited)

Public Health Agency of Canada
For the quarter ended September 30, 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 *	Used during the quarter ended September 30, 2020	Year to date used at quarter-end	Total available for use for the year ended March 31, 2020Footnote *	Used during the quarter ended September 30, 2019	Year to date used at quarter-end
Vote 1 - Operating expenditures	356,173	216,072	268,842	344,940	101,213	165,544
Vote 5 - Capital expenditures	5,521	-4,231	292	9,157	2,190	2,743
Vote 10 - Grants and contributions	233,252	10,987	117,191	244,860	24,312	125,146
(S) Contributions to employee benefit plans	29,765	7,383	14,766	29,886	7,412	14,823
(S) Spending of proceeds from the disposal of surplus Crown assets	1	0	0	79	0	0
(S) Refunds of amounts credited to revenues in previous years	0	0	0	1	1	1
(S) Spending of revenues pursuant to section 4.2 of the Department of Health Act	13,413	2,121	2,121	13,413	2,420	2,420
(S) Payments related to Public Health Events of National Concern and income support	20,261,478	1,272,553	3,013,268	0	0	0
Total authorities	20,899,603	1,504,885	3,416,480	642,336	137,548	310,677
Footnote 1 Includes only authorities available for use and granted by Parliament at quarter end. Return to footnote * referrer

7.0 Agency Budgetary Expenditures by Standard Object (unaudited)

Public Health Agency of Canada
For the quarter ended September 30, 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 September 30, 2020	Year to date used at quarter-end	Planned expenditures for the year ending March 31, 2020	Expended during the quarter ended September 30, 2019	Year to date used at quarter-end
Expenditures:
Personnel	257,900	73,190	125,860	245,175	54,304	103,431
Transportation and communications	196,815	6,524	21,695	7,254	1,693	3,287
Information	149,798	11,652	62,157	16,007	1,752	12,763
Professional and special services	460,099	67,313	75,695	76,998	44,560	47,493
Rentals	13,946	19,393	36,864	2,114	1,175	2,077
Repair and maintenance	5,679	834	1,854	2,878	1,444	2,063
Utilities, materials and supplies	19,331,747	1,053,223	2,708,832	24,142	3,739	8,770
Acquisition of lands, buildings and works	68,600	0	0	0	135	189
Acquisition of machinery and equipment	51,341	238,133	243,246	12,666	2,875	3,625
Transfer payments	360,705	31,080	137,284	244,860	24,313	125,146
Other subsidies and payments	3,569	3,684	3,324	10,764	1,752	2,168
Total gross budgetary expenditures	20,900,199	1,505,026	3,416,811	642,858	137,742	311,012
Less revenues netted against expenditures:
Other Fees and Charges	0	0	0	0	0	0
Rights and Privileges	0	0	0	0	0	0
Services Non-Regulatory	596	141	331	522	194	335
Services Regulatory	0	0	0	0	0	0
Total Revenues netted against expenditures	596	141	331	522	194	335
Total net budgetary expenditures	20,899,603	1,504,885	3,416,480	642,336	137,548	310,677