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Archived - Chapter 2
Accountability Framework

Introduction

The Government is implementing the Economic Action Plan in a manner that is responsive and responsible—appropriately balancing speed of implementation with effective stewardship of taxpayer dollars.

To expedite the implementation of measures in the Plan, the Government has streamlined and accelerated policy development and the process to obtain funding authorities required from Parliament to make payments.

The Government is moving ahead with a number of oversight measures to ensure that spending is effective and meets a high standard of accountability. These measures will be managed by departments and agencies, in consultation with the Treasury Board and its Secretariat, the Office of the Comptroller General as well as the Office of the Auditor General.

Early Budget and Streamlined Policy Approval Process

Canada's Economic Action Plan was tabled at the end of January, the earliest federal budget in history. To develop and implement the Economic Action Plan on an expedited basis, the Government carried out extensive public consultations in a highly compressed timeframe. The Government consulted the provinces and territories, private sector economists, academics, business leaders and thousands of Canadians who participated in online consultations. The Minister of Finance also sought advice from his Economic Advisory Council and Members of Parliament from all parties. Canada's Economic Action Plan is a reflection of this extensive effort.

The policy proposals in the Action Plan are being approved by Cabinet on an expedited timeframe. This approval process includes the establishment of terms and conditions by the Treasury Board for a wide variety of spending programs.

The Canada Revenue Agency is administering most of the tax reductions proposed in the Economic Action Plan, based on Parliament's approval-in-principle of the Action Plan and in accordance with the associated Notices of Ways and Means Motions. Most Canadians will begin to see benefits from personal income tax relief, for measures effective January 1, 2009, after the Canada Revenue Agency adjusts its Payroll Deductions Tables on April 1. Royal Assent to the Budget Implementation Act, 2009 (the implementing legislation for most of the tax proposals in the Economic Action Plan) will provide a basis for ongoing administration of these tax measures.

To expedite the funding of measures in the Economic Action Plan, the Government is using a number of channels:

A. The Budget Implementation Act, 2009 was introduced in the House of Commons on February 6, 2009. The Act includes $7.6 billion in spending authority for a range of budget measures (Table 2.1), many of which would normally be funded through the annual appropriations process but were included in the Act this year in order to facilitate their rapid Parliamentary approval. The Act also includes $2.4 billion in tax reduction measures.

B. A further $3.5 billion in tax reduction measures not included in the Budget Implementation Act, 2009 are being administered by the Canada Revenue Agency in accordance with the Notice of Ways and Means Motion tabled in Parliament with the Budget.

C. About $5.5 billion of 2009–10 spending measures proposed in the Economic Action Plan are not included in the Budget Implementation Act, 2009. For monies to flow under these programs, the necessary funding authorities would need to be obtained from Parliament through the appropriations process. The Government is using two approaches to ensure that departments have access to this funding on a timely basis:

• First, the Government has asked Parliament to approve in the Main Estimates an appropriation of $3 billion as of April 1, 2009 for budget implementation. This would enable Treasury Board Ministers to allocate up to $3 billion in funding directly to departments for immediate cash requirements related to budget measures in advance of the typical Parliamentary supply period (normally in December). In order to access these funds, departments will need to demonstrate that they have sound program management frameworks with appropriate oversight and approval processes in place. The new Vote is an exceptional and time-limited measure, allowing for allocations up to June 30, 2009. Amounts not allocated from the Vote by June 30, 2009 will lapse. To ensure full transparency, all allocations will be reported to Parliament in the Supplementary Estimates.
• The Government will table Supplementary Estimates on May 12, 2009 in order to bring forward the majority of the remaining 2009–10 spending measures for Parliament's approval at the earliest possible opportunity. Royal Assent to the Appropriation Act for these Supplementary Estimates is anticipated for mid-June.

D. The Government has also taken the necessary steps to proceed with loans to support the automotive sector and to support municipalities with housing-related infrastructure. With respect to the latter, Canada Mortgage and Housing Corporation will be in a position to process applications from municipalities in April.

As set out in Table 2.1, the above steps will result in over $20 billion being made available for departments and agencies to implement the Economic Action Plan as of April 1, 2009. This represents close to 90 per cent of funding set out in the Plan for 2009–10. Almost all of the remaining funding will be secured by June, should Parliament approve the special Supplementary Estimates. Normally, funding would not be secured until December.

Together, these measures will allow departments to have funding in place many months earlier than the historical pattern, for which funding was received after approval of the Supplementary Estimates in December.

As shown in Table 2.2, the Government will have obtained Parliamentary approval for the Economic Action Plan by a minimum of 6 months ahead of the normal approval timeframe. For some measures, the approval process has been expedited by over one year.

Oversight and Accountability

All spending under the Economic Action Plan will be subject to oversight and control to ensure that resources are used efficiently and effectively, in compliance with authorities, and that expected results are achieved.

Departmental authorities will be streamlined with increased authorities to spend approved by the Treasury Board based on evidence of strong risk management in departments.

Spending will be subject to requirements set out in the Financial Administration Act and will be subject to review by the internal audit function within departments and by the Office of the Auditor General.

The Financial Administration Act imposes specific responsibilities on departments for prudent management of resources and requirements that govern payments made from the Consolidated Revenue Fund, including the requirement to maintain adequate financial records and to ensure that payments:

• do not exceed funds appropriated for the purpose by Parliament;
• are requisitioned by a Minister or authorized officer in a form prescribed by Treasury Board; and
• are made only after the departmental officer responsible certifies that performance conditions were met if the payments are for goods or services received, or that the recipient is entitled to the payment if it is a grant or contribution.

The internal audit function within departments provides an additional element of internal control. Operating independently of line management, internal audit provides an objective assessment of practices and activities and contributes to accountability and transparency. Internal audit provides deputy heads with assurance as to the design and operation of the governance, risk management and control processes in their organizations.

At year-end, all spending is subject to reporting, and audit by the Office of the Auditor General, through the Public Accounts of Canada tabled annually in Parliament, as well as various other accountability reports, including Departmental Performance Reports.

The Government initiated a dialogue with the Auditor General in the early phases of this implementation plan, with an aim to ensuring that the Plan is consistent with full accountability and good governance. The Government will maintain this dialogue throughout the duration of the Economic Action Plan.

Transparency and reporting are critical tools in ensuring that spending is both responsive and responsible. The Government will report regularly to Parliament on the overall implementation of the Economic Action Plan. Individual Ministers will provide separate updates to Canadians on actions in their areas of responsibility as required.

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