2021–22 Estimates

Highlights of these Estimates

Federal departments, agencies and Crown corporations provide programs and services for Canadians. In order for federal government organizations to operate, Parliament must give these organizations authority to spend. While spending is often announced in a federal budget, spending authority is actually granted through legislation passed by Parliament. These Main Estimates present financial requirements for the 2021–22 fiscal year.

Due to the need to table Main Estimates on or by March 1, emerging priorities and items announced in Budget 2021 will be included in future Estimates documents.

Voted Expenditures

These Estimates support the government’s request to Parliament for authority to spend through annual appropriations:

• $141.9 billion for budgetary expenditures – operating and capital expenditures; transfer payments to other levels of government, organizations or individuals; and payments to Crown corporations; and
• $180.7 million for non-budgetary expenditures – net outlays and receipts related to loans, investments and advances.

These amounts include spending for initiatives announced in prior federal budgets and other funding decisions. Departmental Plans provide details on how these financial resources will be used to achieve planned results.

Of the 123 organizations in these Estimates, six are seeking more than $5.0 billion in voted budgetary expenditures:

• Department of National Defence ($22.8 billion);
• Department of Indigenous Services ($13.4 billion);
• Public Health Agency of Canada ($8.7 billion);
• Treasury Board Secretariat ($7.0 billion);
• Department of Foreign Affairs, Trade and Development ($6.3 billion); and
• Department of Veterans Affairs ($6.2 billion).

Statutory Expenditures

Forecasts of statutory spending, including expenditures pursuant to the proposed Economic Statement Implementation Act, 2020 (Bill C-14), are included in these Estimates to provide additional information on departmentsʼ total estimated expenditures. Of these forecasts, $200.3 billion is for budgetary expenditures, including the cost of servicing the public debt. This amount does not include benefits paid from the Employment Insurance Operating Account or expenditures legislated through the Income Tax Act (such as the Canada Child Benefit). Net non-budgetary expenditures of $4.3 billion are forecasted for loans, investments and advances.

Significant changes in statutory spending from the 2020–21 Main Estimates include:

• new payments to individuals under the Canada Recovery Benefits Act;
• increases in major transfer payments (as published in the Fall Economic Statement 2020), most notably elderly benefits and the Canada Health Transfer;
• an increase in Climate Action Incentive Payments; and
• a decrease in interest on unmatured debt.

Changes in non-budgetary planned expenditures reflect an increase in low cost loans for the construction of sustainable rental apartment projects and for the construction, repair and revitalization of affordable housing.

Additional information on statutory authorities for COVID-19 related expenditures is presented on page I-5 and online.

General Information

Part I of this document, the Government Expenditure Plan, gives an overview of spending requirements for 2021–22, comparisons to previous fiscal years, a summary of legislation authorizing COVID-19 related expenditures and a comparison of these Estimates to the Fall Economic Statement 2020.

Part II of this document, the Main Estimates, provides information on estimated spending by each federal organization requesting authority to spend through a 2021–22 appropriation bill. Forecasts of statutory spending are included for information purposes.

Part III of the Estimates consists of Departmental Plans and Departmental Results Reports. It is anticipated that the Departmental Plans, which show an organization’s priorities and expected results for the next three years, will be tabled shortly after these Estimates.

For these Main Estimates, the President of the Treasury Board tables this document in Parliament. In addition to the tabled document, the following information is available online:

• Budgetary expenditures by standard objects;
• Details on COVID-19 expenditures;
• Expenditures by purpose (core responsibility); and
• Statutory forecasts.

The following terminology is used throughout this document:

• 2019–20 Expenditures refer to the actual expenditures published in the Public Accounts of Canada 2020 (Volume II);
• 2020–21 Estimates to date include the aggregate of the requirements reported in the Main Estimates and Supplementary Estimates (A), (B) and (C) of that fiscal year;
• Budgetary expenditures include the cost of servicing the public debt; operating and capital expenditures; transfer payments to other levels of government, organizations or individuals; and payments to Crown corporations;
• Non-budgetary expenditures – or loans, investments and advances – are outlays that represent changes in the composition of the Government’s financial assets. Negative figures indicate that recoveries exceed expenditures;
• Supplementary Estimates present information on additional spending requirements which were either not sufficiently developed in time for inclusion in the Main Estimates, or have subsequently been refined to account for developments in particular programs and services;
• Voted describes appropriations or expenditures for which parliamentary authority is sought through an appropriation bill;
• Statutory describes appropriations or expenditures which are authorized by Parliament through legislation other than an appropriation act; forecasts are provided for Parliament’s information.

Composition of Estimates

The majority of expenditures in the 2021–22 Main Estimates are transfer payments – payments made to other levels of government, other organizations and individuals. Transfer payments make up approximately 64% of expenditures or $219.0 billion. Operating and capital expenditures account for approximately 30% of expenditures or $102.4 billion, while public debt charges are approximately 6% of expenditures or $20.9 billion.

Comparison of the Fall Economic Statement and Estimates

The following reconciliation is for the purpose of providing greater clarity on the relationship between the figures presented in the Fall Economic Statement 2020 and the 2021–22 Estimates; and to allow for a more effective comparison and study of how the Estimates cash requirements are derived from the accrual-based budget plan.

Items not included in the Estimates

The Fall Economic Statement forecast covers the complete scope of the Government’s fiscal framework, including revenues, program and tax expenditures, statutory expenditures such as Employment Insurance benefits, and provision for future obligations such as public service pensions. The scope of the Estimates is narrower than the Fall Economic Statement forecast. The main purpose of the Estimates is to support Parliament’s consideration of the appropriation bills, which are the legal instruments for authorizing certain payments.

The Estimates are therefore focused on the government’s cash needs which require parliamentary appropriations and exclude certain items reported in the Fall Economic Statement. Costs related to the Canada Emergency Wage Subsidy, Children’s benefits and Employment Insurance benefits are the largest components of the items excluded from the Estimates.

The Canada Emergency Wage Subsidy and the Canada Child Benefit are legislated through the Income Tax Act and are considered expenditures for government financial reporting purposes. Parliament does not authorize annual spending for these items or for any other tax expenditure or refundable tax credit.

Most Employment Insurance costs are paid directly out of the Employment Insurance Operating Account, rather than a departmental appropriation, and are therefore not specifically included in the Estimates.

Netted revenues

Certain expenditures are funded through departmental revenues. Accrual expenses in the budget are on a ‘gross’ basis, meaning the revenues are included in the accrual-based revenue forecast, while they are netted against expenditures in the Estimates.

Accrual and other adjustments

The Fall Economic Statement is presented on a full accrual basis whereas the Estimates are presented on a modified cash basis. The accrual basis of accounting recognizes income when it is earned and expenses when they are incurred, whereas cash accounting recognizes them when the cash or its equivalent has been paid. As a result, certain items will be reported differently between the two publications. This category also includes costs related to consolidated Crown corporations that are funded from their own revenues, as well as a number of other adjustments necessary to forecast expenses on a fully consolidated basis.

Structure of these Estimates

The basic structural units of the Estimates are the votes. The following types of votes appear in the Estimates:

A program expenditures vote is used when there is no requirement for either a separate “capital expenditures” vote or a “grants and contributions” vote because neither equals or exceeds $5 million. In this case, all expenditures are charged to a single vote.

An operating expenditures vote is used when there is also a requirement for either a “capital expenditures” vote or a “grants and contributions” vote or both – that is, when expenditures of either type equal or exceed $5 million. Otherwise, the expenditures are included in the “program expenditures” vote.

A capital expenditures vote is used when the aggregate of capital expenditures equals or exceeds $5 million. Capital expenditures are those made for the acquisition or development of items that are classified as tangible capital assets as defined by government accounting policies, for example: for the acquisition of real property, infrastructure, machinery or equipment, or for purposes of constructing or developing assets, where an organization expects to draw upon its own labour and materials, or employs professional services or other services or goods. Expenditure items in a capital expenditures vote are for items that generally exceed $10,000, although an organization may select a reduced threshold to be applied to different capital classes.

Grants and contributions are payments made for the purpose of furthering program objectives but for which no goods or services are received. A grants and contributions vote is used when grants and/or contributions expenditures equal or exceed $5 million. It should be noted that the inclusion of a grant, contribution or other transfer payment item in the Estimates imposes no requirement to make a payment, nor does it give a prospective recipient any right to the funds. It should also be noted that in the vote wording, the meaning of the word “contributions” is considered to include “other transfer payments”.

A non-budgetary vote, identified by the letter “L” preceding the vote number, provides authority for spending in the form of loans or advances to, and investments in, Crown corporations; and loans or advances for specific purposes to other governments, international organizations or persons or corporations in the private sector.

The government must also establish separate votes for each distinct legal entity and to make payments to Crown corporations. Where this is the case, a separate vote structure is established for each. A legal entity for these purposes is defined as a unit of government operating under an act of Parliament and responsible directly to a Minister.

To support the Treasury Board in performing its statutory responsibilities for managing the government’s financial, human and materiel resources, a number of special votes are required. These votes are described under Treasury Board Secretariat in the Proposed Schedules to the Appropriation Bill.

Changes in 2021–22 Main Estimates