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As Canada’s new Minister of Transport, Infrastructure and Communities, and Minister of the Economic Development Agency of Canada for the Regions of Quebec, I am pleased to present Infrastructure Canada’s Report on Plans and Priorities for 2011-12. The report outlines the department’s commitment to continue investing in world-class, modern infrastructure across the country. Through these investments, we are helping to deliver results that matter to Canadians – a stronger economy, cleaner environment, and more prosperous and vibrant communities.
Over the past two years, Infrastructure Canada has played a significant role in stimulating and re-building the Canadian economy. Through the Government of Canada’s Economic Action Plan (EAP), the department worked hard to quickly approve more than 6,300 projects to create and maintain jobs all across Canada while ensuring the country emerged from the recession with more modern infrastructure.
In the coming year, we will focus our efforts on several important fronts. First, the department will continue to work with funding partners to ensure projects are completed in a timely manner and to provide proper stewardship and oversight as we process and pay thousands of claims for EAP projects. The department will manage the effective close-out of the Infrastructure Stimulus Fund and the Building Canada Fund-Communities Component Top-Up. The extension of the construction deadline to October 31, 2011 is expected to allow sufficient time for virtually all the remaining projects to be completed.
At the same time, we will work closely with our partners to continue the implementation of programs under the long-term $33 billion Building Canada Plan. The coming years will see the start of the busiest phase of the Plan, with construction advancing on many large-scale, multi-year infrastructure projects. Our work will also include oversight for the $2 billion per year Gas Tax Fund and the five-year Green Infrastructure Fund.
Our focus on long-term funding for national and local infrastructure priorities will bring lasting benefits to Canadians. Whether it is a new 335 kilometre power transmission line in northern British Columbia, the expansion of Laval University’s physical education and sports facility, or major repairs to a bridge connecting Halifax and Dartmouth, we are making infrastructure improvements happen. These investments are making Canadian towns, cities and communities better places to live, work and raise our families.
I invite you to follow our progress as we move forward in implementing our infrastructure goals, at www.creatingjobs.gc.ca.
The Honourable Denis Lebel, P.C., M.P.
Minister of Transport, Infrastructure and Communities and
Minister of the Economic Development Agency of Canada for the Regions of Quebec
Strong, modern, world-class public infrastructure is a key factor in achieving the Government of Canada’s priorities of a stronger economy, a cleaner environment and more prosperous, safer communities. Infrastructure Canada leads the Government of Canada’s efforts in addressing Canada’s public infrastructure challenges.
Infrastructure Canada is responsible for federal efforts to enhance Canada’s public infrastructure through strategic investments in provincial, territorial and municipal assets, key partnerships, and sound policies. The department exists to help ensure that Canadians benefit from world-class public infrastructure by supporting initiatives from coast to coast to coast.
As shown in Figure 1, federal support for provincial, territorial and municipal core public infrastructure has increased in recent years, and Infrastructure Canada is the key contributor of federal support.
Figure 1: Federal Infrastructure Support for Provincial, Territorial and Municipal Infrastructure
Over the past decade, increased federal investments in infrastructure, together with leveraged investments from our funding partners, have contributed to the ongoing renewal of Canada’s core public infrastructure. As seen in Figure 2, the average age of Canada’s core public infrastructure peaked in 2000 at 17.2 years. Between 2000 and 2009, this average age has fallen to 15.7 years. The unprecedented infrastructure investments made as part of Canada’s Economic Action Plan (EAP) are likely to contribute to a further decline in the average age of Canada’s public infrastructure in the years to come.
Figure 2 – Average Age of Infrastructure
Over the past two years, the department played a leading role in delivering the Government of Canada’s EAP, rolling out an unprecedented amount of infrastructure investment while maintaining an environment of prudent stewardship. Since January 27, 2009 (Budget 2009) alone, Infrastructure Canada has committed close to $10.8 billion towards more than 6,300 infrastructure projects. When combined with contributions from the provinces, territories, municipalities and other funding partners, this means a total of approximately $31 billion committed for infrastructure projects in communities across the country.
Canada’s EAP has helped see Canada through the worst global recession since the 1930s and continues to contribute to a solid economic recovery. In fact, Canada’s labour market is performing better than its Group of Seven (G-7) peers, with Canada posting the strongest employment growth among G-7 countries since June 2009. In addition, Canada’s economy experienced the smallest decline among the G-7 countries and has now more than fully recouped all of the loss in output experienced during the recession.
Also noteworthy is the fact that Infrastructure Canada’s stimulus funding marks the first time that the department has systematically provided significant funding for infrastructure rehabilitation. Rehabilitation and maintenance are important elements in the lifecycle of most public infrastructure. Just like proper maintenance of homes and vehicles, these types of investment help to extend the useful lives of these assets and in some cases can also increase capacity and improve safety.
In 2011-12, the department will continue to ensure prudent and sound financial management as it begins the intensive close-out process of completed EAP projects. While the EAP deadline has been extended to October 31, 2011, the majority of construction is expected to be completed by the original deadline of March 31, 2011. This is a responsible approach that will allow the completion of any remaining projects across the country that need more time. The extension will only apply to projects that were submitted prior to the announcement of the extension and that have incurred eligible costs before March 31, 2011. Details on extension conditions have been communicated to our partners and to project proponents. The department will work with partners to ensure that projects are completed, and claims for eligible expenses are processed quickly and efficiently. The department will also continue to focus significant efforts on the implementation of its long-term programs under the Building Canada Plan.
Infrastructure Canada delivers a broad range of infrastructure programs, providing flexible and effective funding support for public infrastructure projects together with provincial, territorial, municipal, not-for-profit and private sector infrastructure partners. The department’s funding activities are broadly grouped as follows:
|BUILDING CANADA PLAN|
|Provincial-Territorial Infrastructure Base Fund (PT Base Fund)||$2.3 Billion||The PT Base Fund provides a total of $175 million in funding per jurisdiction. In addition, over $26 million in per capita funding under the Building Canada Fund for the three territories is managed under this fund. The PT Base Fund is for infrastructure priorities identified in each jurisdiction’s capital plans. It was most particularly designed to contribute towards the restoration of fiscal balance, particularly for smaller jurisdictions. Under the Economic Action Plan, jurisdictions could choose to accelerate all funds by March 31, 2011 (2007-08 to 2013-14).|
|Gas Tax Fund (GTF)||$2 Billion annually||Through provincial and other agreements, GTF provides municipalities with predictable, long-term funding coupled with local decision-making enabling municipalities to build and rehabilitate public infrastructure that achieves environmental outcomes. The GTF was launched in 2005-06, and extended in Budget 2007 as part of the Building Canada Plan. In Budget 2008 the government announced that it intends to make this program permanent at $2 billion per year.|
|Building Canada Fund-Communities Component (BCF-CC)||$1 Billion||The BCF-CC provides funding that focuses exclusively on infrastructure pressures facing smaller communities, targeting project investments in communities with populations of less than 100,000. The fund leverages additional contributions from other partners by limiting the maximum federal share for funded projects to one-third, with matching contributions from both the provincial and municipal level (2008-09 to 2016-17).|
|Building Canada Fund-Major Infrastructure Component (BCF-MIC)||$6.7 Billion||The BCF-MIC targets larger infrastructure projects of national or regional significance. At least two-thirds of the funding is targeted to national priorities: water, wastewater, public transit, the core national highway system and green energy. By providing federal funding on a cost-shared basis, the BCF-MIC leverages additional contributions from other partners to promote increased investment in large infrastructure projects (2008-09 to 2016-17).|
|ECONOMIC ACTION PLAN|
|Green Infrastructure Fund (GIF)||$1 Billion||The GIF provides funding over five years for infrastructure projects that promote cleaner air, reduced greenhouse gas emissions, and cleaner water. The GIF provides up to 50% of eligible project costs to promote increased investment in infrastructure in support of a more sustainable economy (2009-10 to 2013-14).|
|Infrastructure Stimulus Fund (ISF)||$4 Billion||The ISF is intended to accelerate and increase the number of provincial, territorial, municipal and some not-for-profit infrastructure projects. It focuses on the rehabilitation of existing assets and new infrastructure that are construction-ready and can be substantially completed by October 31, 2011. By providing up to 50% federal funding to projects, the ISF leverages funding from other partners, generating a much greater overall effect through infrastructure spending to the Canadian economy (2008-09 to 2011-12).|
|Building Canada Fund-Communities Component Top-Up (BCF-CC Top-Up)||$500 Million||The BCF-CC Top-Up provides additional funding in the amount of $500 million (added to the Building Canada Fund-Communities Component) to fund additional two-year infrastructure projects in communities with populations of less than 100,000 (2008-09 to 2011-12).|
|Canada Strategic Infrastructure Fund (CSIF)||$4.9 Billion*||The CSIF provides funding for projects in areas that are vital to sustaining economic growth and enhancing the quality of life of Canadians. The fund leverages additional contributions from other partners by providing up to 50% funding for eligible projects (2003-04 to 2012-13).|
|Municipal Rural Infrastructure Fund (MRIF)||$1.2 Billion||The MRIF provides funding for small-scale municipal infrastructure projects designed to promote and improve quality of life in both urban and rural communities. For most projects, the MRIF provides up to one-third federal funding for eligible projects (2003-04 to 2013-14).|
|Border Infrastructure Fund (BIF)||$675 Million*||The BIF provides funding for investments in physical infrastructure, transportation system infrastructure and improved analytical capacity at surface border crossings. The fund provides up to 50% federal funding (2003-04 to 2013-14).|
* Reflects the amount of funding for projects administered under the program’s terms and conditions.
Throughout this document, project spotlights are provided to showcase some of the many projects across the country that receive funding from Infrastructure Canada. For more information on these projects or any Infrastructure Canada Economic Action Plan project please visit us on line at www.creatingjobs.gc.ca.
PROJECT SPOTLIGHT: Improved Commuter Services in British Columbia
Project location: Vancouver, British Columbia
On March 20, 2009, Canada, the province of British Columbia, and TransLink jointly announced $280 million for transit projects. The funding supports the SkyTrain light rail system and West Coast Express commuter rail system in the lower Mainland, as well as transit facility upgrades in Surrey, Kelowna, Kamloops, and Vernon.
New SkyTrain rail cars will be purchased, rails replaced, and fibre-optic cameras installed. The West Coast Express commuter rail service between Vancouver and Mission will benefit from the purchase of seven additional rail cars, along with upgrades to certain stations to accommodate longer trains and provide enhanced passenger access.
The projects include improving pedestrian circulation and access for people with disabilities, lengthening platforms and enhancing bus connections and cycling accommodation at the Main Street and Scott Road SkyTrain light rail stations.
This work will go a long way in upgrading commuter rail service to meet the growing demand for urban public transit in metro Vancouver.
Federal contribution: $88,300,000 under the Building Canada Fund-Major Infrastructure Component.
III. Federal Delivery Partners
Infrastructure Canada is the lead federal department responsible for infrastructure policy development and program delivery. In some instances, the department collaborates with other federal departments and agencies to promote efficient delivery of its programs. These departments and agencies share their knowledge of local needs and priorities. Infrastructure Canada’s Federal Delivery Partners are:
Under the Federal Sustainable Development Strategy (FSDS) the Government of Canada is taking a major step forward by including environmental sustainability and strategic environmental assessment as an integral part of its decision-making processes. The FSDS identifies four themes for action:
Although Infrastructure Canada is not one of the 26 departments required to table a Departmental Sustainable Development Strategy (DSDS) or to report on its contribution to the FSDS, Infrastructure Canada does play, and will continue to play, a key role in enabling federal partners, other levels of government, as well as small and large Canadian communities in moving towards a more sustainable future.
The department’s policies and core funding activities support thousands of projects across the country that contribute to a cleaner environment in areas such as drinking water, wastewater and stormwater management, clean energy, public transit, brownfield redevelopment and capacity-building for community sustainability planning. These infrastructure investments directly support two of the FSDS themes – Maintaining Water Quality and Availability, and Addressing Climate Change and Air Quality.
Infrastructure Canada is also moving forward with a number of green corporate initiatives which support the fourth theme: Shrinking the Environmental Footprint – Beginning with Government. First, the department has consolidated most of its operations by relocating from seven different locations to Ottawa’s first building that meets the Canada Green Building Council’s Leadership in Energy and Environmental Design (LEED) Gold certificate. Additionally, Infrastructure Canada is moving forward with the implementation of its recent Greening Action Plan, which includes aspects related to green procurement, waste and energy reduction, and environmental practices, awareness and promotion. More details on Infrastructure Canada’s green procurement initiatives can be found in the Supplementary Information Tables on Greening Government Operations, accessible through Treasury Board Secretariat’s website: /est-pre/index-eng.asp.
Section II of this report provides additional information, by program activity, about Infrastructure Canada’s contributions towards the FSDS.
Infrastructure Canada’s Program Activity Architecture (PAA) structure provides a framework for all departmental activities. It organizes resource allocation (both human and financial) against activities and expected outcomes and provides a meaningful way to link activities to broader Government of Canada outcomes.
Infrastructure Canada’s PAA structure has the following three strategic outcomes and 11 active program activities as detailed in Figure 3:
|1) Provinces, territories and municipalities have federal financial support for their infrastructure priorities: Provides federal transfers to provincial, territorial and municipal governments for their infrastructure priorities in order to help maintain a high level of quality core public infrastructure across the country.|
|2) Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment and liveable communities is provided: Provides targeted project-specific investments to address federal/provincial priorities in both large and small communities as well as large strategic investments of national and regional benefit.|
|3) Construction-ready infrastructure projects are provided with federal funding support: Provides timely, temporary and targeted funding to construction-ready projects to support short-term economic stimulus under the Economic Action Plan.|
Infrastructure Canada’s Strategic Outcomes group the department’s flexible and innovative suite of programs into three major activity areas. They speak to long-term infrastructure investments, which include stable and predictable funding programs, such as the Gas Tax Fund, as well as strategic and targeted programs, such as the Building Canada Fund. They also speak to short-term, timely and targeted programs such as the significant funding being provided under the Economic Action Plan.
Section II of this report discusses in detail the program activities, as well as the Internal Services program activity.
Figure 3: Program Activity Architecture
Note: Activities associated with internal services, such as IMIT or corporate finance, are discussed in detail in Section II of this report, and are not reflected in this chart. The above figure contains only the department’s active program activities. Of note, the program activities for National Trail Coalition and the G8 Legacy Fund, which do not have funding for 2011-12 and beyond, are no longer shown, but are still program activities in the department’s Program Activity Architecture structure.
BCF-CC: Building Canada Fund-Communities Component
BCF-CC Top-Up: Building Canada Fund-Communities Component Top-Up
BCF-MIC: Building Canada Fund-Major Infrastructure Component
BIF: Border Infrastructure Fund
CSIF: Canada Strategic Infrastructure Fund
EAR: Economic Analysis and Research
GIF: Green Infrastructure Fund
GTF: Gas Tax Fund
ISF: Infrastructure Stimulus Fund
MRIF: Municipal Rural Infrastructure Fund
PT Base Fund: Provincial-Territorial Infrastructure Base Fund
The last two years have been a time of considerable activity, investment and success for Infrastructure Canada. Moving forward, the department’s priorities are two-fold. First, the department will prudently manage the close-out of its Economic Action Plan (EAP) programs. At the same time, the department will continue the implementation of its long-term infrastructure programs.
With more than 4,600 projects representing approximately $4.5 billion in federal contributions finishing by October 31, 2011, the department will continue to focus considerable effort during the planning year on the successful implementation and winding down of EAP programs. It should be noted that whether projects finish construction by the original March 31, 2011 deadline or take advantage of the extension, the end of the construction phase does not signal the end of program delivery. Once project construction is complete, and eligible costs are no longer being incurred, the final accounting and claims process begins. This process requires the exercise of final oversight and due diligence and is integral to ensuring the sound management of federal funding. Details on the program close-out process can be found below.
While the EAP launched significant new infrastructure programs, it was also accompanied by swift action to accelerate the roll-out of the seven year, $33 billion Building Canada Plan launched in 2007. This was done by making changes to the federal legislative and regulatory framework, as well as through administrative actions, which streamlined project review processes and environmental approvals, all the while protecting the environment.
The 2011-12 planning period will see Infrastructure Canada, together with provincial, territorial and municipal partners continue the successful implementation of programs which support stable, strategic and targeted infrastructure investments geared towards long-term growth and prosperity. For example, many larger strategic projects under the Building Canada Fund-Major Infrastructure Component (BCF-MIC) will continue through planning and construction phases beyond the October 31, 2011 deadline. The department will continue to focus efforts on committing remaining BCF-MIC funding -- new projects will be announced and funded.
Additionally, for 2011-12, the PT Base Fund will continue to provide funding to provinces and territories for their infrastructure priorities, such as roads, highways and water treatment. In total, nearly $350 million is scheduled to be disbursed to provinces in 2011-12.
The Green Infrastructure Fund (GIF) will also see considerable activity during 2011-12. Although the fund was announced in Budget 2009, GIF operates under significantly different parameters than other EAP programs announced at the same time. Projects funded under GIF are large-scale projects that will be completed over a longer timeline than the two-year EAP projects. In many ways GIF is similar to BCF-MIC, and 2011-12 will see GIF projects moving forward through planning and construction phases. Again, in support of long-term stable funding, the department will continue its oversight of the ongoing Gas Tax Fund, as well as begin the policy work on future infrastructure programming, subject to the availability of budgetary resources.
Typical Claims Process:
With more than 4,600 stimulus projects finishing by October 31, 2011, Infrastructure Canada will be heavily focused on performing financial oversight and due diligence of each project file prior to paying all claims. The sheer volume of these simultaneous requests for payments will keep Infrastructure Canada very busy during this planning period. Below is a glimpse of a typical claim process for a municipal project being funded under a provincial or territorial agreement.
It is important to note that, for contribution programs, Infrastructure Canada is not responsible for the management of infrastructure projects. Specifically, under Strategic Outcomes 2 and 3, Infrastructure Canada reimburses eligible expense claims submitted by the recipients – the project managers. As such, the department’s spending lags behind the actual rate of construction. In many cases, recipients choose to submit claims only when all construction is completed. Upon receiving completed claims, the department pays in 30 days.
Infrastructure Canada’s financial and human resources information over the planned period are summarized in Table 1 and Table 2.
The planned spending for 2011-12 in Table 1 does not include funding for the Infrastructure Stimulus Fund and the Building Canada Fund-Communities Component Top-Up, which are the two programs extended until October 31, 2011 under Canada’s Economic Action Plan. Funding for these two programs will be transferred from 2010-11 to 2011-12. This funding transfer will be requested through 2011-12 Supplementary Estimates, reducing the Forecast Spending for 2010-11 and increasing the Planned Spending for 2011-12. Should program close-out require FTEs and planned spending in 2012-13 or beyond, these requirements will be addressed through future Estimates processes.
Infrastructure Canada has no ongoing base level of funding for administration and operating costs. Its operating requirements are funded from specific infrastructure programs as related administrative costs are confirmed on an annual basis. As a result, the department has not yet confirmed its operating budget requirements or approved FTE levels for 2012-13 and future years.
The department’s FTEs are managed in a holistic fashion and resource levels reported against individual programs are based on best available estimates. FTEs may be re-allocated on an as-needed basis during the year to reflect specific requirements of funding programs and other government priorities. Furthermore, many operational resources are not limited to one specific program and may be re-allocated during the year to meet operational priorities. A similarly estimated and proportional amount of operating funding is also allocated to the administration of individual programs. This flexibility allowed the department to adjust quickly to successfully implement and manage new programs arising from the Government of Canada's Economic Action Plan.
Table 3 summarizes the planned spending and strategic outcomes for each departmental program activity. Table 3 also outlines how Infrastructure Canada’s planned outcomes are linked to and support the Government of Canada’s outcome1 areas relating to overall government spending.
Table 3: Program Activities by Strategic Outcomes
|Total funds transferred by the federal government to provinces, territories and municipalities for their infrastructure priorities.||Flow 100% of all planned spending under Strategic Outcome 1 in
|Program Activity||Forecast Spending
|Planned Spending||Alignment to Government of Canada Outcomes1|
|Provincial-Territorial Infrastructure Base Fund||665,585||347,375||154,462||135,040||Strong Economic Growth|
|Gas Tax Fund||2,106,180||1,975,952||1,974,546||1,974,540||Strong Economic Growth|
|Total funding provided to partners for targeted and strategic public infrastructure projects.||
Flow 100% of all planned spending under Strategic Outcome 2 in FY2011-12.
|Partner contributions expressed as percentage of federal funding committed.||100%|
|Program Activity||Forecast Spending
Alignment to Government of Canada Outcomes
|Building Canada Fund-Communities Component||329,889||323,391||275,729||142,653||Strong Economic Growth|
|Building Canada Fund-Major Infrastructure Component||1,120,824||1,270,430||1,319,386||1,002,714||Strong Economic Growth|
|Green Infrastructure Fund||370,316||431,084||159,843||174,852||Clean and Healthy Environment|
|Canada Strategic Infrastructure Fund2||690,187||378,791||233,555||100,336||Strong Economic Growth|
|Municipal Rural Infrastructure Fund3||307,412||47,226||39,300||See Footnote 3||Strong Economic Growth|
|Border Infrastructure Fund||69,364||51,738||68,451||26,035||Strong Economic Growth|
|Economic Analysis and Research||11,767||10,817||4,607||4,600||Innovative and Knowledge-Based Economy|
|Total amount of eligible costs incurred for construction-ready public infrastructure projects.||95% of eligible costs incurred by October 31, 2011.|
|Percentage of projects under the Economic Action Plan that are substantially completed by the end of program, out of total number of projects approved.||
95% of approved EAP projects are substantially completed.
|Funding leveraged from partners, as a percentage of federal funding, for construction-ready public. infrastructure projects.||100% over the life of EAP programs (2009-10 to 2011-12).|
|Program Activity||Forecast Spending
Alignment to Government of Canada Outcomes
|Infrastructure Stimulus Fund6||3,309,429||2,400||See Footnote 6||See Footnote 6||Strong Economic Growth|
|Building Canada Fund-Communities Component Top-Up6||470,755||See Footnote 6||See Footnote 6||See Footnote 6||Strong Economic Growth|
|Support for the G8 Summit (2010)7||9,531||See Footnote 7||See Footnote 7||See Footnote 7||Strong Economic Growth|
|Total Planned Spending for Strategic Outcomes 1, 2 and 3:||9,510,195||4,881,172||4,231,130||3,561,977|
Given the overall direction of the department for 2011-12, Infrastructure Canada has established two operational priorities and two management priorities.
Table 4: Contribution of Priorities to Strategic Outcome
|Operational Priorities||Type8||Links to Strategic Outcome(s)||Description|
|1. Ensure proper financial oversight and appropriate program close-out for programs falling under the Economic Action Plan (EAP).||Previously Committed||Strategic Outcome 3||Continue to collaborate with federal, provincial and territorial partners to ensure proper oversight in the management and close-out of over 4,600 projects that are providing short-term economic stimulus while contributing to long-term infrastructure improvements.|
|2. Efficient and effective stewardship of the longer term infrastructure programs and projects.||Ongoing||Strategic Outcome 1, 2||Ensure program governance including management control frameworks, documentation, monitoring, reporting tools and internal audit regimes are implemented and working effectively to ensure sound stewardship of all program expenditures.|
|Management Priorities||Type||Links to Strategic Outcome(s)||Description|
|1. Implement the results of Infrastructure Canada’s Strategic Review.||New||Strategic Outcome 1, 2||Following the 2011 Federal Budget, the department will implement the results of Infrastructure Canada’s Strategic Review process in order to better meet the needs of Canadians.|
|2. Support Public Service Renewal and improve People Management.||Ongoing||Strategic Outcome 1, 2||In 2009-10 Infrastructure Canada developed and implemented a vision for people management, and revised the Integrated Business and Human Resources Plan (IBHRP) to transform this vision into action planning, and to develop measurable indicators. In 2011-12, the People Management Committee will continue to monitor the implementation of the plan via monthly meetings and quarterly statistics. The department will continue to improve on its recruitment and retention targets and continue to make progress in addressing the priorities set out in the Public Service Renewal Action Plan.|
Infrastructure Canada manages a variety of risks as it strives to realize its strategic outcomes. The department applies a comprehensive approach to actively identify, assess and manage risks at four distinct levels: strategic, operations, program and project. The department conducts regular environmental scans to identify internal and external risk factors which are used to define critical risks. Once any risks are identified, they are analyzed to determine probability and potential impact, and risk responses are developed. This information is then captured in the department’s Corporate Risk Profile and semi-annual update Report on Risk Responses and Re-Assessment of Critical Risk Placements. The department also performs specific risk analyses for its large programs, such as the Infrastructure Stimulus Fund and the Building Canada-Major Infrastructure Component.
In response to unprecedented challenges faced by the Canadian economy, Infrastructure Canada quickly and effectively launched and implemented $5.5 billion in infrastructure investments under the Economic Action Plan (EAP), while maintaining an environment of prudent stewardship that Canadians expect from their government. With the winding down of the programs under the EAP, Infrastructure Canada will devote significant effort during 2011-12 to ensure proper financial and program oversight for the intensive close-out process for thousands of EAP projects.
The last update to the risk profile occurred in the fall of 2010. This pre-dated the announcement of the extension of the EAP programs to October 31, 2011. Early in 2011-12, the department will review and update its key critical risks in the context of the EAP extension and the impact this will have on the department.
The fall 2010 re-assessment concluded that previously identified risk factors were either trending downwards or remained unchanged in terms of overall risk to the department. However, in light of the EAP program extension, the following three risks have been identified as the most critical to the achievement of the department’s strategic outcomes:
i) Flexibility of information management technology
To ensure a smooth close-out of the EAP program and continued delivery of ongoing programs, information management and information technology (IT) systems will need modifications and upgrades. The ability of departments to upgrade and maintain legacy systems and applications is a government-wide challenge that makes it difficult to provide IT solutions that are usable, flexible and effective. Infrastructure Canada is faced with some obsolete systems and applications where the absence of supplier support and maintenance may result in increased system downtime and restrict the department’s ability to implement new capacity or functionality.
Risk responses include:
ii) Provision of all EAP funds within established timeframes
With the allocation of EAP funds completed, the risk perspective has shifted from the prompt selection and approval of projects to the need for timely completion of projects and processing of eligible claims.
Risk responses include:
iii) Adaptability of Human Resources Capacity and Capability
The 2009 Corporate Risk Profile identified human resources challenges as the most significant risk to the department’s ability to deliver on its mandate. The department has addressed the capacity issue related to this risk by implementing effective risk responses outlined in the Integrated Business and Human Resources Plan (IBHRP) to process the influx of EAP-related project applications. It is also developing business models and risk assessment tools to facilitate execution of staffing functions. The new challenge facing the department is the need to rapidly adapt the capability of staff from providing front-end services and support (e.g., project review and assessment, communications support) to providing back-end services and support for EAP program close-out (e.g., monitoring, processing of claims).
Risk responses include:
As previously stated, in 2011-12, significant effort will be dedicated to the close-out of the Infrastructure Stimulus Fund and the Building Canada Fund-Communities Component Top-Up. At the same time, the department will continue to focus on the implementation of its long-term programs under the Building Canada Plan.
Figure 4 presents the department's actual and planned spending profile from 2007-08 to 2013-14. Also as indicated, spending related to Canada's Economic Action Plan started in 2009-10, and is planned to continue through 2011-12; except for the Green Infrastructure Fund which is planned to continue until 2013-14. As such, in 2011-12, departmental spending is expected to peak and decrease as stimulus programs wind down.
Figure 4: Departmental Spending Trend and the Economic Action Plan (EAP)
In 2011-12, Infrastructure Canada expects to spend approximately $4.9 billion on infrastructure investments. Statutory funding authority for a portion of the programs under the Economic Action Plan was provided in the Budget Implementation Act 2009. These programs are: The Infrastructure Stimulus Fund, the accelerated funding under the Provincial-Territorial Infrastructure Base Fund, the Green Infrastructure Fund and the Building Canada Fund-Communities Component Top-Up.
Through a suite of transfer payment programs, the department supports quality, cost-effective public infrastructure investments across Canada. Program design recognizes the provincial, territorial and municipal responsibility for a majority of public infrastructure and Infrastructure Canada's participation as a funding partner. The department is not responsible for the management of infrastructure projects, but rather for the reimbursement of eligible expenses submitted by recipient project managers for contributions programs. In the case of other transfer payment programs, the department provides stable base funding to provinces, territories and municipalities under the terms of signed agreements.
As such, it is important to note that the department’s cash flow lags behind the actual rate of construction of projects. Work begins upon project approval: contracts are put in place, plans drawn up, materials are ordered and construction starts. While the department commits funds upon project approval, federal funding does not flow to recipients until they have submitted claims for actual costs incurred. In many cases, recipients wait until completion of the project before submitting a claim. Upon receiving completed claims, the department pays in 30 days. The department continually works with its partners to ensure that forecasts are as accurate as possible, and to re-profile Infrastructure Canada’s funding to meet the needs of its partners.
Table 5: Voted and Statutory Items Listed in Main Estimates (in $ thousands)
|Truncated Vote or Statutory Wording||
|(S)||Contributions to Employee Benefit Plans||5,157||5,038|
In 2011-12, Infrastructure Canada expects to spend approximately $4.9 billion on infrastructure investments under Economic Action Plan, Building Canada Plan and legacy programs to meet the expected results of its program activities and to contribute to its strategic outcomes. This amount represents a decrease of over $3 billion from the previous year’s Main Estimates. Note: as a result of the deadline extension to October 31, 2011, funding for 2011-12 for the programs under the Economic Action Plan will be transferred from 2010-11 to 2011-12. This funding transfer will be requested through 2011-12 Supplementary Estimates, reducing the Forecast Spending for 2010-11 and increasing the Planned Spending for 2011-12
Estimates by Vote are presented in the 2011-12 Main Estimates which are available here: http://www.tbs-sct.gc.ca/est-pre/2011-2012/me-bpd/info/ info-eng.asp..