Treasury Board of Canada Secretariat's Quarterly Financial Report for the Quarter Ended December 31, 2015

1.1 Basis of Presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Secretariat’s spending authorities granted by Parliament and those used by the department, consistent with the Main Estimates and the Supplementary Estimates (A) and (B) for the 2015-16 fiscal year. The quarterly 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 monies 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.

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

1.2 Secretariat Financial Structure

The Secretariat manages both departmental and government-wide expenditures. Its departmental operating revenues and expenditures are managed under Vote 1, Program Expenditures.

Government-wide expenditures are managed via seven different votes:

• Vote 5, Government Contingencies which serves to supplement other appropriations to provide the Government with sufficient flexibility to meet miscellaneous, urgent or unforeseen departmental expenditures between Parliamentary supply periods.
• Vote 10, Government-Wide Initiatives which supplements other appropriations in support of the implementation of strategic management initiatives in the Public Service of Canada.
• Vote 15, Compensation Adjustments which supplements the appropriations of other government departments and agencies that may need to be partially or fully augmented as a result of adjustments made to terms and conditions of service or employment of the federal public service, including members of the Royal Canadian Mounted Police and the Canadian Forces, Governor in Council appointees and Crown corporations as defined in section 83 of the Financial Administration Act;
• Vote 20, Public Service Insurance, which covers revenues and expenses related to Treasury Board’s role as the employer of the core public administration. This includes revenues and expenses for the Public Service Health Care Plan (PSHCP), Public Service Dental Care Plan (PSDCP), Pensioners’ Dental Services Plan (PDSP), Disability Insurance, Provincial Payroll Taxes (Manitoba, Newfoundland, Ontario and Quebec), Public Service Management Insurance Plan (PSMIP) and other programs;
• Vote 25, Operating Budget Carry Forward which supplements other appropriations for the carry forward of unused operating funds from the previous fiscal year;
• Vote 30, Paylist Requirements which covers paylist requirements for departments and agencies related to legal requirements for the government as employer for items such as parental benefits and severance payments; and
• Vote 33, Capital Budget Carry Forward which supplements other appropriations for the carry forward of unused capital funds from the previous fiscal year. This vote was created in 2011-12. 

The funding within these votes is approved by Parliament. With the exception of Vote 20, the funding within government-wide expenditure votes is eventually transferred from the Secretariat to other government departments and agencies once specified criteria are met. The Secretariat does not directly receive revenue or incur expenses related to Votes 5, 10, 15, 25, 30, 33 unless the Secretariat meets the specified criteria.

Expenditures incurred against Statutory Authorities mainly reflect the employer’s share of Public Service Pension Plans, the Canada/Quebec Pension Plans, Employment Insurance premiums and Public Service Death Benefits. These expenditures are also initially charged to the Statutory Vote of the Secretariat but are attributed throughout the fiscal year to the statutory vote contributions to employee benefit plans of each department and agency, including the Secretariat. 

As a result, this Quarterly Financial Report will highlight the financial results of Vote 1 – Program Expenditures, Vote 20 – Public Service Insurance and Statutory Authorities and expenditures directly related to the Secretariat.

Statement of Voted and Statutory Authorities

Total budgetary authorities available for use decreased in 2015-16 from those in 2014-15 by $65.0M (2.1%). This is the result of a decrease in Vote 1 authorities of $55.2M and a decrease in Vote 20 authorities of $9.9M, offset by an increase in spending authority to make statutory payments of $0.2M.

The change in spending authority by Vote 1, Vote 20 and Statutory Votes is summarized below:

The only key change in Vote 1 TBS Program Authorities since Q2 is primarily due to an increase in funding received for the payout of an out-of-court settlement under the White class action lawsuit to respond to new eligible claimants. All other changes noted in the above table were previously reported in the Secretariat’s Quarterly Financial Report for the period ended September 30, 2015.

Statement of Departmental Budgetary Expenditures by Standard Object

At the end of Q3, budgetary expenditures had decreased by $77.3M (4.7%) as compared to the same period last year. The change in expenditures by standard object is summarized below:

For the quarter ended December 31, 2015