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Public Services and Procurement Canada
Quarterly Financial Report for the quarter ended June 30, 2025

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1. Introduction

This Quarterly Financial Report (QFR) should be read in conjunction with the 2025 to 2026 Estimates (Main Estimates). It has been prepared by management as required under 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. It has not been subject to an external audit or review.

1.1 Mandate, mission and vision

Public Works and Government Services Canada (PWGSC) was established effective June 20, 1996, under the Department of Public Works and Government Services Act. As of November 4, 2015, PWGSC started operating as Public Services and Procurement Canada (PSPC). PSPC plays an important role in the daily operations of the Government of Canada. It supports federal departments and agencies in the achievement of their mandated objectives as their central purchasing agent, real property manager, linguistic authority, treasurer, accountant, pay and pension administrator, and common service provider. PSPC’s mission is to deliver high-quality, central programs and services that ensure sound stewardship on behalf of Canadians and meet the program needs of federal institutions. Its vision is to excel in government operations.

Further details on the department's authority, mandate and core responsibilities can be found in the 2025 to 2026 Estimates (Main Estimates - Part II) and the Public Services and Procurement Canada’s 2025 to 2026 Departmental Plan for the fiscal year ending March 31, 2026.

1.2 Basis of presentation

This quarterly report has been prepared by management using an expenditure basis of accounting and a special-purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities. The accompanying Table 3: Statement of authorities (unaudited) includes the department's spending authorities granted by Parliament, and those used by the department and are consistent with the Main Estimates and Supplementary Estimates for the current fiscal year.

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.

When Parliament is dissolved for the purposes of a general election, section 30 of the Financial Administration Act authorizes, under certain conditions, the preparation of a special warrant to be signed by the Governor General authorizing payments to be made out of the Consolidated Revenue Fund. Special warrants are deemed to be an appropriation for the fiscal year in which they are issued.

Special warrants issued during the first quarter of the current fiscal year were included in the total appropriations in the 2025 to 2026 Main Estimates.

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

1.3 Public Services and Procurement Canada's financial structure

PSPC provides services to many government departments, agencies and Crown corporations through a variety of funding mechanisms. This includes budgetary authorities that are comprised of voted and statutory authorities, as well as non-budgetary authorities. The voted budgetary authorities include operating expenditures, vote-netted revenues and capital expenditures, while the statutory authorities are mainly composed of revolving funds, employee benefit plans and payments in lieu of taxes (PILT). The non-budgetary authorities consist primarily of the Seized property working capital account. The description can be found in subsection 1.3.4, Seized property account.

PSPC's complex financial structure may result in significant fluctuations in authorities on a quarterly basis, which are due to timing differences that are resolved by year-end. These are summarized in the next 4 subsections:

1.3.1 Cost-recovery basis

For the most part, PSPC delivers its services on a cost-recovery basis, generating revenues via revolving fund (the funds) organizations and programs within the operating vote. These organizations and programs are mainly designed to provide services to other government organizations and are expected to recover the cost of their operations through revenues. However, the costs incurred by the funds are usually disbursed prior to invoicing the client, which generally occurs upon completion of a project or after services are rendered, and thus revenues may be collected in a subsequent quarter.

1.3.2 Project management

PSPC manages a variety of real property projects that progress through phases from planning to funding and from procurement to construction. Historical trends have shown that expenditures against these projects are not incurred evenly throughout the year; thus, quarter-to-quarter fluctuations are normal. Such projects include:

1.3.3 Payments in lieu of taxes

PILT issued by PSPC are funded through a statutory vote and paid on behalf of other participating federal departments. Payments are subsequently recovered from the participating departments and are recorded as statutory grants in the Public Accounts of Canada. Timing fluctuations can occur between the payments and the recoveries from the other departments.

1.3.4 Seized property account

PSPC also manages seized property for the Government of Canada pursuant to the Seized Property Management Act. The financial management of this activity is undertaken through the non-budgetary Seized property working capital account. Charged to this account are expenditures and advances made to maintain and manage any seized or restrained property. PSPC recovers its costs from this account once the property owner loses the right to the property and it is disposed of.

2. Highlights of fiscal quarter and fiscal year-to-date results

2.1 Significant changes to authorities

As presented in Table 3: Statement of authorities (unaudited), year-to-date PSPC authorities available for use increased by $2,478.1 million as compared to the same quarter of the previous year ($7,263.2 million in the current fiscal year compared to $4,785.1 million in the previous fiscal year). The items responsible for the overall increase are outlined in Table 1: Year-over-year variances in authorities available for use, followed by a description for each variance.

Table 1: Year-over-year variances in authorities available for use (in millions of dollars)
Initiatives Operating Capital Budgetary statutory authorities Total variance
Planning and Investment in PSPC’s Assets Portfolio 61.8 1,878.7 2.4 1,942.9
Next Generation Human Resources and Pay Initiative 234.8 0 12.1 246.9
Office Portfolio Reduction Plan 102.0 0 0 102.0
Price and Volume Protection 72.4 0 0 72.4
Card acceptance and Postage 37.8 0 0 37.8
Accommodation and real property services for the Canada Revenue Agency 36.1 0 0 36.1
G7 Summit 27.7 0 0 27.7
Translation Bureau’s linguistic services to Parliament 9.7 0 0 9.7
Other 2.9 0 (0.3) 2.6
Cumulative variance in authorities available for use 585.2 1,878.7 14.2 2,478.1

Groupings can change between quarters due to materiality of initiatives.

Amounts may not balance with other public documents due to rounding.

Planning and investment in Public Services and Procurement Canada’s Assets Portfolio: increase of $1,942.9 million

The increase reflects the department’s current funding approval to deliver on its long-term capital funding plan, and to align PSPC’s authorities with its planned expenditures per the Investment Plan (a detailed 5-year plan for investments derived from the PSPC’s Asset Long-Term Strategy and Plans) to deliver major projects and enable the implementation of critical infrastructure projects.

Next Generation Human Resources and Pay Initiative: increase of $246.9 million

Funding is to finalize building and testing the new integrated Human Resources (HR) and pay solution and begin carrying out change management activities with departments and agencies.

Office Portfolio Reduction Plan: increase of $102.0 million

Budget 2024 announced funding for PSPC to reduce its office portfolio by 50%. This funding, which is expected to be recovered through substantial short and long-term cost savings, will help to accelerate the ending of leases and disposal of underused federal properties. To advance work on the Office Portfolio Reduction Plan (OPRP), PSPC sought access to Vote 1 funding for building decommissioning, moves, due diligence for disposals, and workplace optimization in retained assets.

Price and Volume Protection: increase of $72.4 million

The increase is a result of funding received for the protection from inflation and price variations relating to space requirements for real property elements over which PSPC has very little or no control such as rent, utilities, and payments in lieu of taxes.

Card acceptance and Postage: increase of $37.8 million

Federal departments and agencies that accept debit or credit card payments for goods and services incur transaction fees. Postage fees are also incurred for mailing cheques. Both types of fees are paid centrally by the Receiver General. As treasurer, PSPC manages these fees on behalf of federal departments and agencies. The increase in funding was mainly due to estimated revenues to be collected by departments and agencies using payment cards and a projected increase in the fees charged by the card brands.

Accommodation and real property services for the Canada Revenue Agency: increase of $36.1 million

The increase is for PSPC’s provision of accommodation and real property services to the Canada Revenue Agency (CRA). Adjustments are required every year to reflect changes in costs and in the amount of space occupied.

G7 Summit: increase of $27.7 million

Canada hosted the G7 Summit in 2025. PSPC supported other government departments for the planning, organization and delivery of the event. PSPC provided accommodation, special events management, procurement, and interpretation services.

Translation Bureau’s linguistic services to Parliament: increase of $9.7 million

Funding will support interpretation services in a hybrid Parliament context, primarily covering increased costs and demand for interpreters (freelancers). It will also support ongoing studies that examine the long-term effects of sound exposure on interpreters.

Other: increase of $2.6 million

The increase is the result of funding variances in miscellaneous projects and activities.

2.2 Significant changes to year-to-date net expenditures

As presented in Table 4: Departmental budgetary expenditures by standard object (unaudited), year-to-date total net budgetary expenditures have increased by $4.2 million as compared to the same quarter of the previous year ($1,620.6 million in the current fiscal year compared to $1,616.4 million in the previous fiscal year).

Table 2: Year-over-year variances in net budgetary expenditures (presented by standard object) (in millions of dollars)
Standard object June 30, 2025 year-to-date used at quarter end June 30, 2024 year-to-date used at quarter end Year-over-year variance
Personnel 548.4 514.7 33.7
Transportation and communications 17.9 16.7 1.2
Information 1.9 2.9 (1.0)
Professional and special services 399.9 376.0 23.9
Rentals 366.6 339.4 27.2
Repair and maintenance 189.0 220.5 (31.5)
Utilities, materials and supplies 17.3 7.9 9.4
Acquisition of land, buildings and works 118.0 141.4 (23.4)
Acquisition of machinery and equipment 9.0 22.2 (13.2)
Transfer payments 436.7 427.5 9.2
Public debt charges 21.3 24.0 (2.7)
Other subsidies and payments 59.1 58.4 0.7
Revenues netted against expenditures (564.5) (535.2) (29.3)
Total net budgetary expenditures 1,620.6 1,616.4 4.2

Comparative figures have been reclassified to conform to the current year's presentation.

Amounts may not balance with other public documents due to rounding.

The year-over-year net increase of $4.2 million is mainly attributable to:

3. Risks and uncertainties

PSPC integrates risk management principles and practices into business planning, decision-making and organizational processes to identify threats and minimize negative impacts, and maximize opportunities across its diverse range of services and operations. Risk management at PSPC is carried out in accordance with the Treasury Board of Canada Secretariat's Framework for the Management of Risk, Risk and Compliance Process, and PSPC's Integrated Risk Management Framework.

The key risks identified as having a potential financial impact on PSPC's operations are:

3.1 Funding mechanism

PSPC may be unable to achieve its departmental investment objectives and targets, due to the variety of funding mechanisms employed by the department and the need to have better tools to effectively implement the OnePSPC concept, which may impede on-going relationships with clients and the efficiency and effectiveness of the department’s programs and services. To mitigate this risk, PSPC is taking the following measures, among others:

3.2 Global supply

PSPC’s service delivery may encounter challenges due to the impact of disruptions to trading relationships, the increasing price of commodities, increasing uncertainties in supply chains, and the security of those supply chains caused by geopolitical tensions, which could impact stakeholder trust and our clients’ ability to achieve their policy and program objectives, and the public’s trust in the Government of Canada. To mitigate this risk, PSPC is taking the following measures, among others:

3.3 Effective delivery

PSPC may encounter delays to achieving full stabilization of pay administration for the Government of Canada (including pay processing and transfer of information to the pension administrator) as a result of the sustained increase in HR and pay events for public servants while facing capacity constraints which could further impede efforts to increase stakeholder trust and lessen liabilities to the Government of Canada. To mitigate this risk, PSPC is taking the following measures, among others:

3.4 Compromised assets

The integrity, safety and accessibility of PSPC real property and infrastructure assets could be compromised by climate change, natural disasters, infrastructure deterioration and original design deficiencies, as well as human related actions which may impede the continuity of government operations and the wellbeing of Canadians. To mitigate this risk, PSPC is taking the following measures, among others:

3.5 Supply and delivery

The effective and efficient delivery of major PSPC initiatives may be impeded due to the nature of large-scale and complex work (project scale, complexities, partner dependencies, evolving security requirements) along with current global events (inflation, supply delays and industry capacity limitations) which may affect the department’s credibility with stakeholders. To mitigate this risk, PSPC is taking the following measures, among others:

4. Significant changes to operations, personnel and programs

This section highlights significant changes in operations, personnel, and programs during the first quarter of the current fiscal year:

5. Approval by senior officials

Approved by:

Arianne Reza
Deputy Minister
Gatineau, Canada
August 20, 2025

Michael Hammond, CPA
Chief Financial Officer and
Assistant Deputy Minister
Gatineau, Canada
August 19, 2025

6. Appendix

Table 3: Statement of authorities (unaudited)—For the quarter ended June 30, 2025 (in thousands of dollars)
Breakdown by authorities Total available for use for the year ending March 31, 2026 table 3 note 1, table 3 note 2 Used during the quarter ended June 30, 2025 for fiscal year ending March 31, 2026 Year-to-date used at quarter end for fiscal year ending March 31, 2026 Total available for use for the year ending March 31, 2025 table 3 note 1, table 3 note 2 Used during the quarter ended June 30, 2024 for fiscal year ending March 31, 2025 Year-to-date used at quarter end for fiscal year ending March 31, 2025
Vote 1: Gross operating expenditures 5,181,956 1,001,985 1,001,985 4,554,846 1,013,162 1,013,162
Vote 1: Vote-netted revenues (1,447,120) (295,546) (295,546) (1,405,199) (257,838) (257,838)
Vote 1: Net operating expenditures 3,734,836 706,439 706,439 3,149,647 755,324 755,324
Vote 5: Capital expenditures 3,313,865 282,443 282,443 1,435,135 256,318 256,318
Real Property Services Revolving Fund: Gross expenditures 2,687,023 371,779 371,779 2,451,434 380,510 380,510
Real Property Services Revolving Fund: Revenues (2,686,323) (236,875) (236,875) (2,430,634) (244,761) (244,761)
Real Property Services Revolving Fund: Net expenditures 700 134,904 134,904 20,800 135,749 135,749
Translation Bureau Revolving Fund: Gross expenditures 172,705 30,702 30,702 183,945 36,588 36,588
Translation Bureau Revolving Fund: Revenues (166,894) (26,625) (26,625) (178,870) (30,878) (30,878)
Translation Bureau Revolving Fund: Net expenditures 5,811 4,077 4,077 5,075 5,710 5,710
Optional Services Revolving Fund: Gross expenditures 32,062 9,194 9,194 15,104 (5,989) (5,989)
Optional Services Revolving Fund: Revenues (33,226) (5,408) (5,408) (15,208) (1,727) (1,727)
Optional Services Revolving Fund: Net expenditures (1,164) 3,786 3,786 (104) (7,716) (7,716)
Total of all revolving funds: Gross expenditures 2,891,790 411,675 411,675 2,650,483 411,109 411,109
Total of all revolving funds: Revenues (2,886,443) (268,908) (268,908) (2,624,712) (277,366) (277,366)
Total revolving fund net expenditures 5,347 142,767 142,767 25,771 133,743 133,743
Other budgetary statutory authorities: Contributions to employee benefit plans 208,751 52,188 52,188 173,581 43,395 43,395
Other budgetary statutory authorities: Minister of Public Services and Procurement—Salary and motor car allowance 102 25 25 99 25 25
Other budgetary statutory authorities: Refunds of amounts credited to revenues in previous years 0 0 0 0 0 0
Other budgetary statutory authorities: Spending of proceeds from the disposal of surplus Crown assets 367 0 0 876 0 0
Other budgetary statutory authorities: Collection agency fees 0 0 0 0 0 0
Other budgetary statutory authorities: Payment in lieu of taxes to municipalities and other taxing authoritiestable 3 note 2 0 436,732 436,732 0 427,626 427,626
Total other budgetary statutory authorities 209,220 488,945 488,945 174,556 471,046 471,046
Total budgetary authorities 7,263,268 1,620,594 1,620,594 4,785,109 1,616,431 1,616,431
Non-budgetary authorities 0 0 0 0 0 0
Total authorities 7,263,268table 3 note 3 1,620,594 1,620,594 4,785,109table 3 note 3 1,616,431 1,616,431

Table 3 Notes

Table 3 Note 1

Includes only authorities available for use and approved by Parliament at quarter-end. Amounts may not balance with other public documents due to rounding.

Return to table 3 note 1 referrer

Table 3 Note 2

Consistent with the presentation in the Main Estimates, "Total available for use for the year", for both fiscal years ending March 31, 2026 and March 31, 2025, under "PILT", is presented net of planned PILT made to municipalities and the equivalent planned recoveries from other government departments. A description of PILT is provided in section 1.3 Public Services and Procurement Canada's financial structure of this report.

Return to table 3 note 2 referrer

Table 3 Note 3

The total available for use for the year ending March 31, 2026 experienced a net increase of $2,478.1 million as compared to the previous fiscal year.

Return to table 3 note 3 referrer
Table 4: Departmental budgetary expenditures by standard object (unaudited)—For the quarter ended June 30, 2025 (in thousands of dollars)
Breakdown by standard object Planned expenditures for the year ending March 31, 2026table 4 note 1, table 4 note 2 Expended during the quarter ended June 30, 2025 for fiscal year ending March 31, 2026 Year-to-date used at quarter end for fiscal year ending March 31, 2026 Planned expenditures for the year ending March 31, 2025table 4 note 1, table 4 note 2 Expended during the quarter ended June 30, 2024 for fiscal year ending March 31, 2025 Year-to-date used at quarter end for fiscal year ending March 31, 2025
Expenditures: Personnel 2,187,301 548,377 548,377 2,033,292 514,714 514,714
Expenditures: Transportation and communications 114,085 17,880 17,880 69,009 16,691 16,691
Expenditures: Information 27,463 1,908 1,908 33,901 2,882 2,882
Expenditures: Professional and special services 3,630,910 399,898 399,898 2,110,043 375,954 375,954
Expenditures: Rentals 1,417,271 366,645 366,645 1,335,047 339,395 339,395
Expenditures: Repair and maintenance 1,719,769 189,014 189,014 1,495,814 220,531 220,531
Expenditures: Utilities, materials and supplies 163,377 17,309 17,309 174,851 7,874 7,874
Expenditures: Acquisition of land, buildings and works 1,573,468 117,953 117,953 888,071 141,423 141,423
Expenditures: Acquisition of machinery and equipment 160,307 9,014 9,014 138,497 22,193 22,193
Expenditures: Transfer paymentstable 4 note 2 0 436,724 436,724 0 427,543 427,543
Expenditures: Public debt charges 119,275 21,266 21,266 119,630 23,991 23,991
Expenditures: Other subsidies and payments 483,605 59,060 59,060 416,865 58,444 58,444
Total gross budgetary expenditures 11,596,831 2,185,048 2,185,048 8,815,020 2,151,635 2,151,635
Less revenues netted against expenditures: Revolving funds revenues (2,886,443) (268,908) (268,908) (2,624,712) (277,366) (277,366)
Less revenues netted against expenditures: Vote-netted revenues (1,447,120) (295,546) (295,546) (1,405,199) (257,838) (257,838)
Total revenues netted against expenditures (4,333,563) (564,454) (564,454) (4,029,911) (535,204) (535,204)
Total net budgetary expenditures 7,263,268 1,620,594 1,620,594table 4 note 3 4,785,109 1,616,431 1,616,431table 4 note 3

Table 4 Notes

Table 4 Note 1

Includes only authorities available for use and approved by Parliament at quarter-end. Amounts may not balance with other public documents due to rounding.

Return to table 4 note 1 referrer

Table 4 Note 2

Consistent with the presentation in the Main Estimates, "Planned expenditures for the year" for both fiscal years ending March 31, 2026 and March 31, 2025, under "Transfer payments", are presented net of planned PILT made to municipalities and the equivalent planned recoveries from other government departments. A description of PILT is provided in section 1.3 Public Services and Procurement Canada's financial structure of this report.

Return to table 4 note 2 referrer

Table 4 Note 3

The year-to-date used at quarter ended June 30, 2025 experienced a net increase of $4.2 million as compared to the same quarter of the previous fiscal year.

Return to table 4 note 3 referrer

© His Majesty the King in Right of Canada, as represented by the Minister of Public Services and Procurement Canada, 2025

ISSN 2819-2117

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