Treasury Board of Canada Secretariat Quarterly Financial Report for the Quarter Ended September 30, 2024

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, 2025. 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:

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, 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:
  • 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)
  • Public Service Management Insurance Plan
• 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 6 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 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. 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 (program expenditures). Unused central vote funding is returned to the Consolidated Revenue Fund.

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.

2.1 Statement of voted and statutory authorities

Total budgetary authorities available for use increased by $459.5 million (12.2%) from the previous fiscal year:

• Vote 1 authorities increased by $28.4 million
• Vote 20 authorities increased by $431.5 million
• Statutory authorities decreased by $0.4 million

The following table provides a detailed explanation of these changes.

2.2 Statement of departmental budgetary expenditures by standard object

For the year-to-date ended September 30, 2024, budgetary expenditures have increased by $330 million (16.8%) when compared to the same period in the previous year:

• Vote 1 expenditures decreased by $7.2 million
• Vote 20 expenditures increased by $159.4 million
• Statutory payments increased by $177.8 million

For the fiscal quarter ended September 30, 2024, budgetary expenditures have increased by $122.9 million (10.5%) when compared to the same period in the previous year:

• Vote 1 expenditures decreased by $35.2 million
• Vote 20 expenditures increased by $70.2 million
• Statutory payments increased by $87.9 million

The following table provides a detailed explanation of these changes by vote and by standard object.

Financial management

There is a financial risk associated with the department’s ability to secure adequate funding to achieve its expected results. This risk arises due to the multitude of competing departmental and enterprise priorities and the current financial climate, characterized by spending reductions. Regular financial forecasting exercises and strong governance will guide resource prioritization and evaluate the need for reallocation of additional funding to support critical initiatives.  

Organizational transformation and change management

There exists a financial risk associated with TBS’s capacity to execute change initiatives, as success relies on the collaboration, support and funding from other government departments. To address the risk, TBS will continue to foster community involvement, draw upon established best practices, focus on cross-training skilled employees to maximize flexibility and use existing policies and governance to make sound decisions on prioritizing, planning and implementing change initiatives.

Professional services

There exists a possibility that TBS does not achieve value for money in its contracted professional services. Given increased visibility, the government recently updated contract management policies. It is imperative to ensure that new measures are fully implemented to yield optimal value where all contracts are efficiently administered, transparent and adhere to all procurement policies and guidelines. To mitigate, it is essential to maintain comprehensive and robust documentation throughout the procurement life cycle, practice stringent oversight and appropriate governance, and ensure alignment of deliverables with procurement requirements. Furthermore, TBS will continue with its development tools and checklists, and enhanced training on roles and responsibilities around procurement.

Information technology

There is a financial risk associated with information technology system management, including existing technical debt and encompassing maintenance, upgrades, replacements as well as cybersecurity protection. To mitigate the risk, TBS will continue to employ robust tools and processes to address critical IT issues, as well as swiftly identify and counteract potential cyber threats. Additionally, the department will leverage existing financial planning processes and governance structures to prioritize critical information technology needs, including long-term investments for IT system updates.

4.1 Operations and programs

There were no changes to operations or programs in the second quarter.

4.2 Personnel

Luc Gagnon was appointed Chief Technology Officer, effective July 4, 2024.

Rod Greenough was appointed Assistant Deputy Minister, Office of the Comptroller General, effective July 19, 2024.