Treasury Board of Canada Secretariat’s Quarterly Financial Report for the Quarter Ended September 30, 2021
Statement outlining results, risks and significant changes in operations, personnel and programs
Table of contents
1. Introduction
In this section
This quarterly report has been prepared by management as required by section 65.1 of the Financial Administration Act and in the manner prescribed by the Treasury Board. The report should be read in conjunction with the Main Estimates and the Supplementary Estimates (A), as well as Budget Plan 2018, Budget Plan 2019 and Budget Plan 2021.
The report has been reviewed by the Departmental Audit Committee.
1.1 Basis of presentation
This report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Treasury Board of Canada Secretariat’s (TBS’s) spending authorities granted by Parliament and those used by TBS, consistent with the Main Estimates and the Supplementary Estimates (A) for the fiscal year ending March 31, 2022. This 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 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.
TBS uses the full accrual method of accounting to prepare and present its annual departmental financial statements, which are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.
1.2 Raison d’être
TBS is the central agency that acts as the administrative arm of the Treasury Board, a committee of Cabinet. TBS supports the Treasury Board in the following principal roles:
Spending oversight
Review spending proposals and authorities; review existing and proposed government programs for efficiency, effectiveness and relevance; provide information to Parliament and Canadians on government spending.
Administrative leadership
Lead government wide initiatives; develop policies and set the strategic direction for government administration related to service delivery, access to government information, and the management of assets, finances, information and technology.
Regulatory oversight
Develop and oversee policies to promote good regulatory practices; review proposed regulations to ensure they adhere to the requirements of government policy; and advance regulatory cooperation across jurisdictions.
Employer
Develop policies and set the strategic direction for people management in the public service; manage total compensation (including pensions and benefits) and labour relations; undertake initiatives to improve performance in support of recruitment and retention.
1.3 TBS’s financial structure
TBS manages both departmental and Treasury Board central votes. Its departmental operating expenditures and revenues are managed under Vote 1, Program Expenditures.
This quarterly report highlights the financial results of:
- Vote 1, Program Expenditures, related to the delivery of TBS’s mandate
- Vote 20, Public Service Insurance, related to the employer’s share of group benefit coverage to employees of the core public service under the various plans listed below
- Statutory authorities that cover any residual amounts between the government’s contributions to the various plans and the distribution of these costs to departments
TBS manages seven different central votes:
- Vote 5, Government Contingencies, supplements other appropriations to provide federal departments and agencies with temporary advances for urgent or unforeseen departmental expenditures between parliamentary supply periods.
- Vote 10, Government‑Wide Initiatives, supplements other appropriations to support the implementation of strategic management initiatives across the federal public service.
- Vote 15, Compensation Adjustments, supplements other appropriations to provide funding for adjustments made to terms and conditions of service or employment of the federal public administration as a result of collective bargaining.
- Vote 20, Public Service Insurance, provides the employer’s share of group benefit plan coverage costs as part of the Treasury Board’s role as the employer of the core public administration. These plans include the Public Service Health Care Plan, Public Service Dental Care Plan, Pensioners’ Dental Services Plan, Disability Insurance Plan, provincial payroll taxes (British Columbia, Manitoba, Newfoundland and Labrador, Ontario and Quebec), and the Public Service Management Insurance Plan.
- Vote 25, Operating Budget Carry Forward, supplements other appropriations for the carry forward of unused operating funds from the previous fiscal year, up to 5% of the gross operating budget in an organization’s Main Estimates.
- Vote 30, Paylist Requirements, supplements other appropriations to meet legal requirements for the government as employer for items such as parental benefits and severance payments.
- Vote 35, Capital Budget Carry Forward, supplements other appropriations for the carry forward of unused capital funds from the previous fiscal year, up to 20% of an organization’s capital vote.
The funding in these votes is approved by Parliament. With the exception of Vote 20, funding in central votes is transferred from TBS to individual departments and agencies once specified criteria are met. Like any other department, TBS also receives its own share of appropriations transferred from these votes to its own Vote 1. Any unused balance from these central votes is returned to the fiscal framework at the end of the year and is reported as TBS’s lapse.
Expenditures incurred against statutory authorities mainly reflect the government’s obligation to pay the employer’s share of the Public Service Pension Plan, the Canada Pension Plan and the Québec Pension Plan, Employment Insurance premiums and public service death benefits. TBS recovers from other government departments and agencies their share of the employer contributions under the Public Service Superannuation Act, and is subsequently charged by Public Services and Procurement Canada for actual expenditures in the same statutory vote. Adjustments are made at year‑end to individual departments’ statutory votes (including those of TBS) for the difference between periodic recoveries and actual expenditures. At year-end, the net effect on TBS’s financial statements will be zero.
Transfer amounts from all central votes mentioned above will be included in the financial reports of the individual recipient departments.
2. Highlights of fiscal quarter and fiscal year to date results
In this section
This section:
- highlights the financial results for the quarter and fiscal year-to-date ended September 30, 2021
- provides explanations of variances compared with the same period last year that exceed materiality thresholds of:
- $1 million for Vote 1, Program Expenditures, and Statutory authorities
- $10 million for Vote 20, Public Service Insurance
| 2021–22 Budgetary authorities to March 31, 2022 |
2020–21 Budgetary authorities to March 31, 2021 |
Variance in budgetary authorities |
Year-to-date expenditures as at Q2 2021–22 (September 30, 2021) |
Year-to-date expenditures as at Q2 2020–21 (September 30, 2020) |
Variance between 2021–22 year-to-date and 2020–21 year-to-date expenditures |
Q2 Expenditures 2021–22 |
Q2 Expenditures 2020–21 |
Variance between 2021–22 Q2 and 2020–21 Q2 expenditures |
|
|---|---|---|---|---|---|---|---|---|---|
| Vote 1: Program Expenditures | 303,477 | 209,816 | 93,661 | 142,738 | 140,636 | 2,102 | 71,821 | 69,376 | 2,445 |
| Vote 20: Public Service Insurance | 3,048,120 | 2,386,081 | 662,039 | 1,300,008 | 1,332,850 | -32,842 | 655,977 | 833,672 | -177,695 |
| Statutory authorities | 35,327 | 31,088 | 4,239 | -249,690 | -191,681 | -58,009 | -162,080 | -168,271 | 6,191 |
| Total | 3,386,924 | 2,626,985 | 759,939 | 1,193,056 | 1,281,805 | -88,749 | 565,718 | 734,777 | -169,059 |
2.1 Statement of voted and statutory authorities
The COVID‑19 pandemic had a significant effect on TBS’s budgetary authorities’ schedules in 2020–21. A typical supply schedule has returned in 2021–22, which explains the significant variances in authorities between the two fiscal years. In Q2 2020–21, the Main Estimates had not been approved by Parliament; they are typically granted by the end of June. TBS eventually received full supply of the 2020–21 Main Estimates in December 2020.
Total budgetary authorities available for use increased by $759.9 million (28.9%) from the previous fiscal year:
- Vote 1 authorities increased by $93.7 million
- Vote 20 authorities increased by $662.0 million
- Statutory authorities increased by $4.2 million
The following table provides a detailed explanation of these changes.
| Changes to voted and statutory authorities (2021–22 compared with 2020–21) | $ thousands |
|---|---|
| Vote 1: Program Expenditures | |
| Funding increases attributable to the reduced supply in 2020–21, which represents nine twelfths of the Main Estimates | 63,541 |
| Funding for Phoenix stabilization and HR-to-Pay initiatives (Budget 2021) | 18,989 |
| Funding for the Canadian Digital Service to provide critical digital products and services (COVID-19) | 12,332 |
| Funding to support the implementation of proactive pay equity in the federal public service (Budget 2019) | 5,496 |
| Funding to foster a diverse and inclusive public service | 5,319 |
| Compensation adjustments to fund salary increases to meet obligations under new collective agreements | 4,373 |
| Reprofile of the Centralized Enabling Workplace Fund | 2,231 |
| Other miscellaneous increases (for example, funding for the Centre for Regulatory Innovation (2018 Fall Economic Statement), transfers from various organizations to support the Government of Canada Financial and Materiel Management Solution Project, transfer from Transport Canada for the pilot of new assessment tools related to the Project Management Strategy, reprofile of funding for the Greening Government Fund and Workload Migration and Cloud Enablement) | 1,850 |
| Net decrease in the Operating Budget Carry Forward | -7,585 |
| Internal reallocation of resources from program expenditures to public service insurance to better align program administration costs | -3,019 |
| Sunset of funding to establish the Office of Public Service Accessibility | -3,009 |
| Other miscellaneous decreases (for example, sunsetting of funding for an Online Regulatory Consultation System, Employee Wellness Support Program, and Program and Administrative Services (PA) Group Modernization) | -2,537 |
| Transfer of funding to various organizations for innovative approaches to reduce greenhouse gas emissions in government operations | -2,193 |
| Sunset of funding to support the Regulatory and Skills Reviews (Budget 2018) | -2,127 |
| Subtotal Vote 1 | 93,661 |
| Vote 20: Public Service Insurance | |
| Funding for the public service insurance plans and programs | 794,463 |
| Funding increases attributable to the reduced supply in 2020–21, which represents eleven twelfths of the Main Estimates | 180,935 |
| Funding for the Disability Insurance Plan | 77,900 |
| Other miscellaneous increases | 4,541 |
| Decrease associated with one-time funding in 2020-21 for the Disability Insurance Plan | -395,800 |
| Subtotal Vote 20 | 662,039 |
| Statutory authorities | |
| A net increase in TBS's share of contributions to employee benefit plans compared to last year as a result of new funding, primarily for the Canadian Digital Service to provide critical digital products and services (COVID-19), funding to foster a diverse and inclusive public service, and funding for Phoenix stabilization and HR-to-Pay initiatives (Budget 2021) | 4,239 |
| Subtotal statutory authorities | 4,239 |
| Total authorities | 759,939 |
2.2 Statement of departmental budgetary expenditures by standard object
The year-to-date budgetary expenditures, as at September 30, 2021, have decreased by $88.7 million (6.9%) compared to the same period in the previous year:
- Vote 1 expenditures increased by $2.1 million
- Vote 20 expenditures decreased by $32.8 million
- Statutory payments decreased by $58.0 million
For the fiscal quarter ended September 30, 2021, budgetary expenditures have decreased by $169.1 million (23%) compared to the same period in the previous year:
- Vote 1 expenditures increased by $2.4 million
- Vote 20 expenditures decreased by $177.7 million
- Statutory payments increased by $6.2 million
The following table provides a detailed explanation of these changes by vote and by standard object.
| Standard object | Changes to voted and statutory expenditures | Variance between 2021–22 year-to-date and 2020–21 year-to-date expenditures (April 1 to September 30) | Variance between 2021–22 Q2 and 2020–21 Q2 expenditures (July 1 to September 30) |
|---|---|---|---|
| Vote 1: Program Expenditures ($ thousands) | |||
| 1 Personnel | The increase in salary expenditures is due to:
The increase is partially offset due to a decrease in salary expenditures as a result of an internal reallocation of resources from program expenditures to public service insurance to better align program administration costs, the closure of the Centre for Wellness, Inclusion and Diversity (CWInD) and the sunsetting of the Employee Wellness Support Program (EWSP) initiative. |
6,266 | 223 |
| 4 Professional and special services | The decrease in expenditures is largely due to the:
The decrease is partially offset by an increase in the cost of consultants for Shared Services Canada infrastructure as well as SAP Release 2. |
-4,006 | -3,354 |
| 5 Rentals | The increase in expenditures is primarily due to the timing of payments for software and licences, as well as the cost of maintenance and support for Business Intelligence: Enterprise Information Intelligence Software Solution (EIISS) licences paid to Public Services and Procurement Canada (PSPC) this year. | 2,276 | 1,102 |
| 12 Other Subsidies and Payments | The decrease in year-to-date expenditures is mainly due to the timing and/or increase of cost recovery from other government organizations for the:
This decrease is offset by lower cost recoveries compared to the previous year for the GCfm project. The increase in Q2 expenditures is due to the timing of cost recovery for the GC Tools Project, which was recovered in Q1 of this year. |
-2,311 | 3,259 |
| Other | Miscellaneous expenditures | -123 | 1,215 |
| Subtotal Vote 1 | 2,102 | 2,445 | |
| Vote 20: Public Service Insurance | |||
| 1 Personnel | The increase in year-to-date expenditures is mainly due to:
This increase is offset by a decrease in the Disability Insurance (DI) Plan as a result of the top-up payment made to the Plan in July 2020. The decrease in the Q2 expenditures is due to the decrease in the Disability Insurance (DI) Plan as a result of the top-up payment made to the Plan in July 2020. The decrease is offset by:
|
8,687 | -166,229 |
| Vote-netted revenue | The increase in vote-netted revenues is mainly attributable to the following:
|
-49,465 | -15,228 |
| Other | Miscellaneous expenditures | 7,936 | 3,762 |
| Subtotal Vote 20 | -32,842 | -177,695 | |
| Statutory expenditures | |||
| 1 Personnel | The change in statutory expenditures is mainly attributable to the following:
|
-58,009 | 6,191 |
| Subtotal statutory expenditures | -58,009 | 6,191 | |
| Total expenditures | -88,749 | -169,059 | |
3. Risks and uncertainties
TBS must provide leadership across the federal government to fulfill its digital, administrative and employer roles. As a result, the department is expected to deliver on a number of complex, emerging and government-wide initiatives within short time frames and with constrained financial resources.
The department is continually looking for opportunities to improve financial management and project management practices, as well as to mitigate financial risks, including those related to financial forecasting and planning. Doing so will ensure that resources are available to deliver on priority initiatives and that TBS-led government-wide projects are delivered within scope, schedule and budget while achieving their objectives.
To ensure delivery of these initiatives, employee wellness is prioritized in the department. The pandemic’s impact on physical and mental health could result in short-term absenteeism. The department will continue assessing the impact of the COVID‑19 pandemic on its employees, the future of the workplace and the eventual return to the workplace. Such assessment includes continued action on workload management, work-life balance and increasing resilience, as well as raising awareness of products and tools to support the well-being of employees. These actions will allow the department to attract, develop and retain a diverse and high‑performing workforce.
Furthermore, having the right tools and information technology (IT) systems are an important part of operations. Levels of service could be impacted due to outages or cybersecurity incidents, which could have an impact on the organization’s ability to deliver its objectives. To mitigate these risks, TBS has modernized departmental IT systems and moved from an on-premise to a cloud-based environment. In addition, TBS is implementing new collaboration tools to facilitate the shift to a more mobile workforce because of the COVID‑19 pandemic.
TBS will continue to closely monitor its environment and operations to reallocate resources to key priorities and to ensure that resources are being managed effectively to deliver results.
4. Significant changes in relation to operations, personnel and programs
This section highlights significant changes in operations, personnel and programs of TBS during the second quarter of the fiscal year.
Catherine Luelo was appointed as Chief Information Officer of Canada, effective July 26, 2021.
On August 5, 2021, the Secretary of the Treasury Board announced the departure of Glenn Purves, Assistant Secretary, Expenditure Management Sector.
Annie Boudreau was appointed as the Assistant Secretary of the Expenditure Management Sector, effective September 7, 2021.
5. Approval by senior officials
Approved by:
_____________________________
Peter Wallace, Secretary
Approved by:
_____________________________
Karen Cahill, Chief Financial Officer
Ottawa, Canada
Date: November 18, 2021
6. Appendix
| Fiscal year 2021-2022 | Fiscal year 2020-2021 | |||||
|---|---|---|---|---|---|---|
| Total available for use for the year ending | Used during the quarter ended | Year to date used at quarter-end | Total available for use for the year ending | Used during the quarter ended | Year to date used at quarter-endtable 4 note ** | |
| Vote 1 – Program Expenditures | 303,477,302 | 71,821,380 | 142,738,435 | 209,816,419 | 69,376,820 | 140,636,403 |
| Vote 20 – Public Service Insurance | 3,048,119,626 | 655,977,016 | 1,300,008,011 | 2,386,081,081 | 833,671,794 | 1,332,849,556 |
| Statutory Authorities | ||||||
A111 – President of the Treasury Board - Salary and motor car allowance |
92,500 | 23,175 | 46,350 | 91,300 | 22,800 | 45,600 |
A140 – Contributions to employee benefit plans |
35,234,836 | 7,913,119 | 15,826,238 | 30,996,532 | 7,308,408 | 14,616,816 |
A145 – Unallocated employer contributions made under the Public Service Superannuation Act and other retirement acts and the Employment Insurance Act (EI) |
- | -170,016,250 | -265,563,066 | - | -175,602,369 | -206,343,666 |
A681 – Payments under the Public Service Pension Adjustment Act |
- | 13 | 26 | - | 13 | 22 |
A683 – Payments for the pay equity settlement pursuant to section 30 of the Crown Liability and Proceedings Act |
- | - | - | - | - | - |
| Total Statutory Authorities | 35,327,336 | -162,079,943 | -249,690,452 | 31,087,832 | -168,271,148 | -191,681,229 |
| Total authorities | 3,386,924,264 | 565,718,453 | 1,193,055,994 | 2,626,985,332 | 734,777,465 | 1,281,804,731 |
Table 4 Note
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| Fiscal year 2021-2022 | Fiscal year 2020-2021 | |||||
|---|---|---|---|---|---|---|
| Planned expenditures for the year ending | Expended during the quarter ended | Year to date used at quarter-end | Planned expenditures for the year ending | Expended during the quarter ended | Year to date used at quarter-end | |
| Expenditures | ||||||
1 Personnel |
4,114,223,183 | 724,449,593 | 1,551,013,896 | 3,255,047,103 | 884,264,231 | 1,594,070,213 |
2 Transportation and communications |
3,144,896 | 16,948 | 29,030 | 2,735,126 | 84,140 | 164,100 |
3 Information |
505,456 | 134,793 | 368,480 | 316,569 | 156,032 | 243,893 |
4 Professional and special services |
82,360,001 | 27,875,321 | 48,531,481 | 54,154,847 | 28,087,936 | 44,551,823 |
5 Rentals |
3,965,692 | 2,037,034 | 3,414,271 | 2,479,988 | 934,829 | 1,138,346 |
6 Repair and maintenance |
2,273,381 | 89,154 | 124,102 | 1,971,993 | 139,613 | 152,456 |
7 Utilities, materials and supplies |
2,155,188 | 23,071 | 36,831 | 1,173,787 | 68,969 | 98,845 |
9 Acquisition of machinery and equipment |
6,288,515 | 1,290,451 | 2,904,716 | 4,742,585 | 389,553 | 3,425,413 |
10 Transfer payments |
981,690 | 35,006 | 535,019 | 819,601 | 1,323 | 501,332 |
12 Other subsidies and payments |
1,115,231 | -2,178,069 | -6,395,597 | -1,479,177 | -7,126,214 | -5,424,299 |
Total gross budgetary expenditures |
4,217,013,233 | 753,773,302 | 1,600,562,229 | 3,321,962,423 | 907,000,411 | 1,638,922,121 |
| Less revenues netted against expenditures | ||||||
Vote-Netted Revenues (VNR) - Centrally managed items |
-811,957,101 | -186,214,128 | -405,665,514 | -684,210,815 | -169,919,013 | -354,813,458 |
Vote-Netted Revenues (VNR) - Program expenditures |
-18,131,868 | -1,840,721 | -1,840,721 | -10,766,276 | -2,303,932 | -2,303,932 |
Total Revenues netted against expenditures |
-830,088,969 | -188,054,849 | -407,506,235 | -694,977,091 | -172,222,946 | -357,117,390 |
| Total net budgetary expenditures | 3,386,924,264 | 565,718,453 | 1,193,055,994 | 2,626,985,332 | 734,777,465 | 1,281,804,731 |
| Government-wide expenses included abovetable 5 note * | ||||||
1 Personnel |
3,851,759,767 | 655,262,383 | 1,410,696,528 | 3,098,864,395 | 816,822,888 | 1,462,923,791 |
3 Information |
- | - | - | - | 2,444 | 2,444 |
4 Professional and special services |
2,283,125 | 14,198,368 | 23,942,234 | 2,057,000 | 11,161,795 | 16,124,297 |
7 Utilities, materials and supplies |
- | - | - | - | - | - |
10 Transfer payments |
500,000 | 1,336 | 301,349 | 458,333 | 1,323 | 301,332 |
12 Other subsidies and payments |
- | 1,689,827 | 3,307,499 | - | - | 1,967,505 |
Total |
3,854,542,892 | 671,151,914 | 1,438,247,610 | 3,101,379,728 | 827,988,450 | 1,481,319,369 |
Table 5 Note
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