We are currently moving our web services and information to Canada.ca.

The Treasury Board of Canada Secretariat website will remain available until this move is complete.

Frequently Asked Questions - New Policy on Transfer Payments

Q1:      Why is there a new Policy on Transfer Payments?

A:  A review of the 2000 Policy on Transfer Payments began in 2004.  In 2006, as part of the Government of Canada's Federal Accountability Action Plan, an Independent Blue Ribbon Panel (BRP) reviewed the administration of federal grant and contribution programs.  Responding to the BRP, the government announced a comprehensive action plan to reform the administration of grants and contributions.  The new Policy is a core element of the plan.

The new Policy also supports Treasury Board Secretariat's policy renewal initiatives to ensure that Treasury Board policies clarify roles and responsibilities in support of strengthened accountability.

This policy applies to departments as defined in section 2 of the Financial Administration Act, unless excluded by specific acts, regulations or Order in Council.

 Q2:      What is the objective of the new Policy on Transfer Payments?

 A:  The objective of the new Policy is to ensure that transfer payment programs are managed with integrity, transparency and accountability in a manner that is sensitive to risks; are citizen- and recipient-focused; and are designed and delivered to address government priorities in achieving results for Canadians.

In pursuit of this objective, the Policy focuses on ensuring that:

  • Roles, responsibilities and accountabilities for the management of transfer payment programs are clearly defined and understood by all departments;
  • Transfer payment programs are designed, delivered and managed in a manner that takes account of risk and clearly demonstrates value for money;
  • Administrative requirements on applicants and recipients are proportionate to the level of risks specific to the program, the materiality of funding, and to the risk profile of applicants and recipients;
  • There are cost-effective oversight and control systems, at both departmental and government-wide levels;
  • Transfer payment programs are accessible, understandable and useable by applicants and recipients;
  • Applicants and recipients are engaged in support of innovation, continuous improvement and the establishment of fair, transparent and positive relations with them; and,
  • Collaboration exists within and among departments to harmonize transfer payment programs and standardize their administration, when appropriate.

Q3:      What are the key changes in the new Policy on Transfer Payments?

 A:  Some of the key changes in the new Policy include:

  • Clarified roles and responsibilities for Treasury Board, ministers, the Secretary of the Treasury Board, and deputy heads.
  • Emphasis on a risk based approach to monitoring and recipient reporting;
  • A requirement to engage recipients, when appropriate.
  • The requirement to establish departmental service standards.
  • Requirements to pursue harmonization of transfer payment programs and standardization of administrative practices.
  • A leadership and support role for the Secretary of the Treasury Board to promote and facilitate collaboration among departments.
  • Increased authority for ministers to approve continuation of terms and conditions following a review of the relevance and effectiveness of a transfer payment program.
  • Ministers will be able, under certain conditions, to seek delegation from Treasury Board to approve the amendments of terms and conditions for some or all existing departmental transfer payment programs.

Q4:      How does the new Policy address the Report of the Independent Blue Ribbon Panel (BRP) on Grant and Contribution Programs?

 A:  The new Policy is a core element of a broader Government of Canada Action Plan as a follow-up to the BRP.  The Policy directly addresses the BRP recommendations by requiring that departments:

  • Tailor administrative requirements on recipients to risks thereby, reducing the administrative burden (reporting, monitoring and audit requirements) on recipients;
  • Engage applicants and recipients in the design of transfer programs, when appropriate;
  • Establish departmental service standards;
  • Focus on the standardization of administrative processes; and
  • Harmonize programs with similar objectives or which serve the same recipients.

Q5:      What impact will the replacement of Chapter 1-4 - Grants and Contributions of the Official Languages policy suite have?

 A:  The Policy on Transfer Payments expands the scope of coverage, beyond the scope of Chapter 1-4 – Grants and Contributions, to apply to departments as defined in section 2 of the Financial Administration Act (unless excluded by specific acts, regulations or Orders in Council), currently including more than 100 federal institutions.  As well, it addresses the official languages requirements by requiring deputy heads to ensure that "…when transfer payment programs support activities that benefit members of both official language communities, that their design and delivery respect the obligations of the Government of Canada set out in Part VII of the Official Languages Act and that services and benefits are made available in both official languages in compliance with the Official Languages Act".

As such, the new policy will have a positive impact on: communications and services to the public; the vitality of official language minority communities; and, the promotion of English and French languages in Canadian society.  There are no direct or anticipated impacts on language of work within the federal government.

 Q6:      What impact will the new Policy on Transfer Payments have on departments, applicants and recipients?

A:  The new Policy will impact departments by:

  • Requiring a culture change to move towards adopting a risk-based approach to management of transfer payment programs; the need to engage applicants and recipients in the design of transfer payment programs; and the establishment of service standards
  • Requiring departments to address standardization of their administrative processes for transfer payments;
  • Requiring departments to look at the potential for harmonization of transfer payment programs and collaborate with other departments in doing so;
  • Reducing the number of submissions to Treasury Board given the option for ministers to exercise increased authority for terms and conditions;

It will positively impact applicants and recipients by:

  • Reducing the administrative burden imposed on them, including reporting and audit requirements;
  • Creating opportunities to be engaged in the design or re-design of a program in support of innovation, continuous improvement and the establishment of fair, transparent and positive relations;
  • Ensuring reasonable and practical departmental service standards are in place;
  • Making transfer payment programs increasingly harmonized within and across departments; and
  • Making transfer payment programs more accessible, understandable and useable for them.

 Q7:      What documents will support the new Policy on Transfer Payments?

A:  The new Policy will be supported by a Directive on Transfer Payments, and a Guide on Transfer Payments

The Directive will provide more detailed, mandatory requirements on the design, delivery and management of transfer payment programs.  The Guide on Transfer Payments will provide explanation, non-mandatory guidance, good practices and advice on the Policy and Directive.

Q8:      What is the timeframe for the implementation of the new Policy on Transfer Payments?

 A:  The new Policy takes effect October 1, 2008.

There will be gradual implementation for the Policy's new requirements related to risk management, applicant and recipient engagement, and departmental service standards.

These will apply to all new and renewed programs approved after March 31, 2010, providing time for departments to build the capacity needed to meet these specific policy requirements.

 Q9:      Will the Directive on Transfer Payments be available at the same time as the new Policy?

A:  The directive is being finalized in consultation with departments, and it is anticipated that it will be completed over the Summer.  The directive will take effect on October 1, 2008. 

 Q10:    What impact will the new Policy on Transfer Payments have on existing transfer payment programs and their terms and conditions?

A:  Existing terms and conditions remain in effect until they expire or are otherwise terminated.

 Q11:  What impact will the new Policy on Transfer Payments have on existing funding agreements?

A:  Existing funding agreements remain in effect until their expiry.  However, an existing funding agreement may be amended by the department, with the concurrence of the recipient, to reflect the requirements of the new Policy.

 Q12:  Will training be available to departments to support implementation of the new Policy on Transfer Payments?

 A.  The Treasury Board Secretariat is working with the Canada School of the Public Service on updating training materials for federal employees delivering transfer payment programs.  In addition, a Centre of Expertise will be established in Treasury Board Secretariat to promote best practices and facilitate the implementation of the new Policy.

Q13:  Will this training be available for recipient organizations so that they have the same level of information?

A:  Departments and recipients will have access to the Guide on Transfer Payments on the TBS web site, as well as frequently asked questions.  In addition, departments may consider providing information sessions for applicants and recipients.  Engagement of recipients in the design of transfer payment programs will also be an opportunity to share knowledge.

Date modified: