Analysis of trends in spending and human resources

Actual expenditures

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CRA Spending Trend (dollars)Footnote 1
  Actual spendingFootnote 2
Planned spending
  2015-16 2016-17 2017-18 2018-19 2019-20 2020-21
Statutory 1,034,149,642 936,635,156 941,296,937 916,610,222 913,826,933 911,597,459
Voted 3,112,837,652
3,453,312,607 3,766,470,408 3,288,115,538 3,304,601,598 3,265,420,851
Total
4,146,987,294
4,389,947,763 4,707,767,345 4,204,725,760 4,218,428,531 4,177,018,310

Over the period 2015-16 to 2020-21, the CRA's voted expenditures/appropriations show an increase primarily as a result of funding received to implement and administer various measures announced in the federal budgets, transfers from Public Services and Procurement Canada for accommodation and real property services, as well as wage settlements. Actual spending in the 2017-18 fiscal year includes a significant increase associated with the cash out of severance benefits for employees represented by the Public Service Alliance of Canada (PSAC) bargaining unit. The 2016-17 and 2017-18 fiscal years also reflect higher spending as a result of retroactive payments associated with collective bargaining increases for employees represented by the PSAC and Professional Institute of the Public Service of Canada (PIPSC) bargaining units, including amounts set aside in anticipation of wage settlements for the period under the operating budget freeze.

The above increases have been partially offset by planned decreases in funding for the upgrade of the individual income tax processing system and the administration of the Softwood Lumber Agreement, as well as other miscellaneous items such as decreases in Government advertising programs and the transfer of CRA training programs to the Canada School of Public Service.

Over the period 2015-16 to 2020-21, the CRA's statutory authorities show a decrease, primarily due to a reduction in disbursements to the provinces following the expiration of the Softwood Lumber Agreement and changes in employee benefit plan rates. These decreases have been partially offset by increases for children's special allowance payments.

Budgetary performance summary for Core Responsibilities and Internal Services (dollars)Footnote 3
Core Responsibilities and Internal Services (Departmental Results Framework) 2017-18
Main Estimates
2017-18
Planned spending
2018-19
Planned spending
2019-20
Planned spending
2017-18
Total authorities available for useFootnote 4
2017-18
Actual spendingFootnote 5 (authorities used)
2016-17
Actual spendingFootnote 6 (authorities used)
2015-16
Actual spendingFootnote 6 (authorities used)
TaxFootnote 7 2,737,078,407 2,737,078,407 
2,793,270,920 2,819,226,312 3,169,626,064 3,145,344,608  2,919,596,085 2,778,029,782
BenefitsFootnote 8 487,819,400
487,819,400 482,609,132 474,246,261 488,482,549 479,298,608 475,216,775 449,400,252
Taxpayers' Ombudsman 3,183,760
3,183,760 3,132,365 3,141,688  3,325,836 3,210,404 2,894,786 2,047,159
Subtotal 3,228,081,567
3,228,081,567 3,279,012,417 3,296,614,261 3,661,434,449 3,627,853,620 3,397,707,646 3,229,477,193
Internal Services 934,818,007
934,818,007 925,713,343 921,814,270 1,184,377,971 1,079,913,725 992,240,117 917,510,101
Total 4,162,899,574
4,162,899,574 4,204,725,760 4,218,428,531 4,845,812,420 4,707,767,345 4,389,947,763 4,146,987,294
Less: Respendable Non-Tax Revenue under Section 60 of the Canada Revenue Agency Act (165,720,262)
(165,720,262) (159,856,226) (153,747,478) (166,387,494) (166,387,494)
(163,733,679) (169,032,577)
Plus: Cost of services received without charge N/A
466,944,402 449,900,714 451,711,382 N/A 598,489,629 512,443,686 463,246,580
Net cost N/A 4,464,123,714 4,494,770,248 4,516,392,435 N/A 5,139,869,480 4,738,657,770 4,441,201,297

Over the planning period (from $4.205 billion in 2018-19 to $4.218 billion in 2019-20), the CRA's appropriations increased, primarily as a result of funding received to implement and administer various measures announced in the federal budgets as well as for adjustments to accommodation and real property services. These increases have been partially offset by planned decreases in funding for the upgrade of the individual income tax processing system.

Actual human resources

Human resources summary for Core Responsibilities and Internal Services (full-time equivalents)
Core Responsibilities and Internal Services (Departmental Results Framework) 2015-16
Actual FTEsFootnote 9
2016-17
Actual FTEsFootnote 9
2017-18 2018-19
Planned FTEs
2019-20
Planned FTEs
Planned FTEs Actual FTEs
Tax
28,981 29,529 30,104 30,399 30,691 30,882
Benefits
1,287 1,299 1,592 1,253 1,506 1,474
Taxpayers' Ombudsman
21 25 31 25 31 31
Subtotal 30,289 30,853 31,727 31,677 32,228 32,387
Internal Services 7,688 7,875 7,665 8,088 7,707 7,606
Total 37,977
38,728 39,392 39,765 39,935 39,993

The increase in actual FTEs in 2017-18 is largely attributable to new funding received to implement and administer measures announced in the 2017 Federal Budget, as well as growth in funding for measures announced in the 2016 Federal Budget.

Over the planning period (from 39,935 in 2018-19 to 39,993 in 2019-20) the increase in FTEs is primarily the result of funding received for various measures announced in the federal budgets partially offset by reductions in planned investment projects.

Expenditures by vote

For information on the CRA's organizational voted and statutory expenditures, consult the Public Accounts of Canada 2017-2018xxiii.

Government of Canada spending and activities

Information on the alignment of the CRA's spending with the Government of Canada's spending and activities is available in the GC InfoBasexix.

Financial statements

The CRA's financial statements for the year ended March 31, 2018, as well as the Auditor General of Canada's opinion on them, are available on canada.caxxiv.

Financial statements highlights – Agency Activities

Condensed Statement of Operations (unaudited) for the year ended March 31, 2018 (dollars)
Financial information 2017-18
Planned results
2017-18
Actual results
2016-17
Actual results
Difference
(2017-18 Actual results minus 2017-18 Planned results)
Difference
(2017-18 Actual results minus 2016-17 Actual results)
Total expenses
4,810,433,000 4,915,827,517 4,918,113,681 105,394,517 (2,286,164)
Total revenues
508,203,000 519,251,687 533,965,158 11,048,687 (14,713,471)
Net cost of operations before government funding and transfers
4,302,230,000 4,396,575,830 4,384,148,523 94,345,830 12,427,307

The CRA's 2017-18 net cost of operations before government funding and transfers amounted to $4,396.5 million, an increase of $12.4 million from the $4,384.1 million net cost of operations before government funding and transfers in 2016-17.

Personnel expenses (salaries, other allowances and benefits) represent 74% of total expenses and are the CRA's primary costs. The remaining 26% of expenses are comprised of other costs such as information technology (IT) and accommodation expenses.

Personnel costs have decreased by $21.4 million in 2017-18. Although salary expenses have slightly increased ($26.1 million), other allowances and benefits have decreased ($47.5 million). This decrease is mainly explained by the termination of the accumulation of accrued severance benefits for the employees under the Public Service Alliance of Canada (PSAC) collective agreement. 

Non-personnel expenses have increased by $19.1 million in 2017-18. This net variance mainly results from an increase in IT services provided by Shared Services Canada (SSC) ($78.5 million) mostly due to the implementation of a costing methodology by SSC to refine its assessment of the cost of services provided without charge to other government departments (OGD). This increase was offset in part by a decrease in accommodation costs as a result of a reduction in the number of fit‑up projects ($34.3 million) and a decrease in the cost of legal services provided without charge by Justice Canada ($10.8 million) due to a change in the scope of the costing methodology to calculate the amount of services provided without charge to OGD.

Non-tax revenues decreased by $14.7 million in 2017-18, which is mostly attributable to greater revenues in 2016-2017 resulting from the invoicing of the retroactive salary payments applicable to the administration of the Canada Pension Plan and the Employment Insurance Act.

Condensed Statement of Financial Position (unaudited) as of March 31, 2018 (dollars)
Financial information
2017-18 2016-17  Difference
(2017-18 minus 2016-17)
Total net liabilities
1,283,659,460 1,479,204,021 (195,544,561)
Total net financial assets
523,417,713 329,741,215 193,676,498
Departmental net debt
760,240,746 1,149,462,806 (389,222,060)
Total non‑financial assets
425,846,275 411,843,222 14,003,053
CRA net financial position
334,395,472 737,619,584 (403,224,112)

Liabilities have decreased by $195.5 million in 2017-18. This was mainly attributable to a significant decrease in employee severance benefit liability since settlement payments were issued in 2017-18 to the employees under the PSAC collective agreement who opted to cash out the full or partial value of their accumulated benefits following the plan curtailment in 2016-2017. This decrease was offset in part by an increase in the provision for salary increases payable in relation to newly signed and/or expired collective agreements.

The increase in financial assets is correlated to specific increases in liabilities, as an account receivable is created for liabilities that are not settled at year-end, but for which appropriations were used. This account receivable, the due from the Consolidated Revenue Fund (CRF), represents the net amount of cash that the CRA is entitled to draw from the CRF that is administered by the Receiver General for Canada without using further appropriations to discharge its liabilities. The vast majority of the $193.7 million increase in financial assets in 2017-18 is due to the increase in accrued salaries.

Financial statement highlights – Administered Activities

Condensed statement of administered revenues and pension contributions and statement of administered expenses and recoveries (unaudited) for the year ended March 31, 2018 (in millions of dollars)
Financial information 2017-18 2016-17 Difference
Total administered revenues and pension contributions
430,331 402,368 27,963
Total net administered expenses and recoveries (35,096) (32,506) (2,590)
Revenues paid or payable directly to a province
(390)
(300) (90)
Change in administered assets and liabilities
(5,596) (1,463)
(4,133)
Net cash deposited in the Consolidated Revenue Fund of the Government of Canada
389,249 368,099 21,150

The CRA administers revenues for the Government of Canada, provincial and territorial governments and First Nations as well as pension contributions and other revenues for the Canada Pension Plan. The total administered revenues amounted to $430,331 million in 2017-18, an increase of $27,963 million or 6.9% from 2016-17. The increase is mainly due to sustained economic growth.

The CRA administers expenses for the Government of Canada, provincial and territorial governments as well as the doubtful accounts expense for the Canada Pension Plan. The CRA also administers recoveries for the Government of Canada relating to the Old age security and Employment insurance benefits. The total net administered expenses and recoveries amounted to $35,096 million in 2017-18, an increase of $2,590 million or 8% from 2016-17. The increase reflects higher Canada child benefit program payments, which replaced the child tax benefit and the universal child care benefit programs in July 2016. It also reflects a higher doubtful accounts expense, which rose by $530 million.

Condensed statement of administered assets and liabilities (unaudited) as at March 31, 2018 (in millions of dollars)
Financial information 2017–18 2016–17 Difference
Total administered assets
128,475 116,135 12,340
Administered liabilities
62,604 55,860 6,744
Net amount due to the Consolidated Revenue Fund 65,871 60,275 5,596
Total liabilities
128,475 116,135 12,340

Total administered assets amounted to $128,475 million as at March 31, 2018, an increase of $12,340 million or 10.6% in 2016-17. The increase is generally in line with the growth in revenues as a result of a strong economy.

Administered liabilities amounted to $62,604 million as at March 31, 2018, an increase of $6,744 million or 12.1% in 2016-17. The increase reflects higher amounts payable to corporations as well as higher GST/HST refund claims.

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