Report on Plans and Priorities 2016–17: Supplementary Information Tables

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Departmental Sustainable Development Strategy

1. Overview of the Federal Government's Approach to Sustainable Development

The Federal Sustainable Development Strategy (FSDS) 2013–16 presents the Government of Canada's sustainable development activities, as required by the Federal Sustainable Development Act. In keeping with the objectives of the Act to make environmental decision making more transparent and accountable to Parliament, the Department of Finance Canada (the Department) supports the implementation of the FSDS through the activities listed in this supplementary information table.

This Departmental Sustainable Development Strategy (DSDS) presents the planned contributions and expected results for Theme I – Addressing Climate Change and Air Quality, Theme III – Protecting Nature and Canadians, and Theme IV – Shrinking the Environmental Footprint – Beginning with Government.

2. Themes I to III: Department- and Agency-Led Targets

The Department is not responsible for leading a target for Themes I to III of the FSDS 2013–16.

3. Themes I to III: Implementation Strategies

A. Linkage of the Department's Implementation Strategies to the Program Alignment Architecture

The Department provides effective economic leadership through its clear focus on one strategic outcome: a strong economy and sound public finances for Canadians. All programs relate to this strategic outcome. The following implementation strategies related to goals and targets under Themes I and III of the FSDS 2013–16 are all elements of Sub-Program 1.1.1: Taxation (part of Program 1.1: Economic and Fiscal Policy Framework) of the Department’s Program Alignment Architecture.

B. The Department's Implementation Strategies

The following implementation strategies are related to FSDS Theme I – Addressing Climate Change and Air Quality.

Goal 1: Climate Change

In order to mitigate the effects of climate change, reduce greenhouse gas emission levels and adapt to unavoidable impacts.

Target 1.1: Climate Change Mitigation

Relative to 2005 emission levels, reduce Canada's total greenhouse (GHG) gas emissions by 17% by 2020.

Goal 2: Air Pollution

Minimize the threats to air quality so that the air Canadians breathe is clean and supports healthy ecosystems.

Target 2.1: Outdoor Air Pollutants

Improve outdoor air quality by ensuring compliance with new or amended regulated emission limits by 2020 and thus reducing emissions of air pollutants in support of Air Quality Management System objectives.

1. Accelerated capital cost allowance for clean energy generation equipment

Encourage businesses, through the accelerated capital cost allowance for clean energy generation equipment, to invest in specified equipment that can contribute to a reduction in harmful emissions and diversification of the energy supply.

An accelerated CCA for income tax purposes is provided under CCA Class 43.2 (50% per year on a declining balance basis) for businesses that invest in clean energy generation and conservation equipment. Class 43.2 includes specified equipment that generates or conserves energy by using a renewable energy source (e.g., wind, solar and small hydro), using fuels from waste (e.g., landfill gas, wood waste and manure) or by making efficient use of fossil fuels (e.g., high-efficiency cogeneration systems).

The provision of an accelerated CCA is an explicit exception to the general practice of setting CCA rates based on the useful life of assets. Accelerated CCA provides a financial benefit by deferring taxation. This incentive for investment is premised on the environmental benefits of low-emission or no emission energy generation equipment and its ability to displace consumption of fossil fuels.

  • Relationship between the implementation strategies and the FSDS targets
    To the extent that Class 43.2 encourages incremental investment in clean energy generation and energy conservation equipment, it has an indirect positive impact on the environment. It could contribute to a reduction in greenhouse gas emissions, pursuant to Target 1.1: Climate Change Mitigation, and to a reduction in air pollutants, pursuant to Target 2.1: Outdoor Air Pollutants.
  • Outline of the non-financial performance information
    Providing a modest financial incentive for investment in clean energy generation and energy conservation equipment provides an incentive for businesses to invest in such equipment.
2. Green Levy

Impose a Green Levy on certain fuel-inefficient passenger vehicles available in Canada.

The Green Levy applies to passenger vehicles with a weighted (55% city and 45% highway) fuel consumption rating of 13 litres or more per 100 kilometres and is imposed at rates ranging from $1,000 to $4,000 per vehicle. The Green Levy is payable by manufacturers or importers of new vehicles delivered after March 19, 2007, and by importers of used vehicles, if the used vehicle was originally put into service (in any jurisdiction) after March 19, 2007. The Canada Revenue Agency and the Canada Border Services Agency are responsible for the administration of the Green Levy, working with manufacturers and importers of vehicles to facilitate its application.

  • Relationship between the implementation strategies and the FSDS targets
    The Green Levy aims to encourage clean, sustainable transportation choices by Canadians by discouraging the purchase of certain fuel-inefficient vehicles. This measure may be contributing to a reduction in greenhouse gas emissions, pursuant to Target 1.1: Climate Change Mitigation, and to a reduction in air pollutants, pursuant to Target 2.1: Outdoor Air Pollutants.
  • Outline of the non-financial performance information
    The Green Levy aims to discourage the purchase of certain fuel–inefficient vehicles and to promote the development and deployment of cleaner transportation technologies.

The following implementation strategy is related to FSDS Theme III – Protecting Nature and Canadians:

Goal 4: Conserving and Restoring Ecosystems, Wildlife and Habitat, and Protecting Canadians

Resilient ecosystems with healthy wildlife populations, so Canadians can enjoy benefits from natural spaces, resources and ecological services for generations to come.

Target 4.3: Terrestrial Ecosystems and Habitat Stewardship

Contribute to the proposed national target so that by 2020, at least 17% of terrestrial areas and inland water are conserved through networks of protected areas and other effective area-based conservation measures.

3. Ecological Gifts Program

Maintain the incentives for the protection of Canada’s ecologically sensitive land, including habitat used by species at risk, through ongoing tax assistance for donations of ecologically sensitive land under the Ecological Gifts Program.

Under the Ecological Gifts Program, Canadian landowners may donate ecologically sensitive land, or easements, covenants and servitudes on such land, to conservation charities to ensure its preservation in perpetuity. Under this program, donors may benefit from the charitable donations tax credit (for individuals) or the charitable donations deduction (for corporations) on the full value of the gifts of ecologically sensitive land. Donors are eligible for a special 10-year carry-forward of this credit or deduction. In addition, capital gains that have accrued on the donated land are eligible for a complete exemption from capital gains tax. 

To protect the public interest, Environment and Climate Change Canada is responsible for certifying:

  • The eligibility of recipient charitable organizations;
  • The ecological sensitivity of the donation; and
  • The fair market value of the donation.

In addition, to ensure the perpetual protection of the land that is the subject of the gift, the Income Tax Act imposes special tax liabilities for recipients of ecologically sensitive land if there are any changes in use without the prior authorization of Environment and Climate Change Canada.

  • Relationship between the implementation strategy and the FSDS targets
    The Ecological Gifts Program is intended to help Canada’s landowners and conservation groups in their habitat conservation and protection efforts. In particular, donations of ecologically sensitive land can contribute to the protection of non-park protected habitat, including habitat used by species at risk, pursuant to Target 4.3: Terrestrial Ecosystems and Habitat Stewardship.
  • Outline of the non-financial performance information
    Although the decision to donate ecologically sensitive land is generally motivated by non–financial factors, the significant income tax benefits provided through the Ecological Gifts Program provide an incentive to further encourage donations of ecologically sensitive land.

4. Theme IV: Targets and Implementation Strategies

Goal 7: Waste and Asset Management

Target 7.2: Green Procurement

As of April 1, 2014, the Government of Canada will continue to take action to embed environmental considerations into public procurement, in accordance with the federal Policy on Green Procurement.

Performance Measurement
Expected result

Environmentally responsible acquisition, use and disposal of goods and services.

Performance indicator
Targeted performance level

Departmental approach to further the implementation of the Policy on Green Procurement in place as of April 1, 2014.

Completed December 2015

Number and percentage of procurement and/or materiel management specialists who completed the Canada School of Public Service Green Procurement course (C215) or equivalent, in fiscal year 2016–17.

6

100%

Number and percentage of managers and functional heads of procurement and materiel whose performance evaluation includes support and contribution toward green procurement, in fiscal year 2016–17.

2

100%
Departmental green procurement target

By March 31, 2017, 90% of purchases of audiovisual equipment will include criteria to reduce the environmental impact associated with the production, acquisition, and use and/or disposal of the equipment.

Performance indicator
Targeted performance level

Dollar value of audiovisual equipment purchases that meet the target objective relative to the total dollar value of all audiovisual equipment purchased

90%

Departmental green procurement target

By March 31, 2017, 90% of IT hardware purchases will include criteria to reduce the environmental impact associated with the production, acquisition, use and/or disposal of the equipment.

Performance indicator
Targeted performance level

Dollar value of IT hardware purchases that meet the target objective relative to the total dollar value of all purchases of IT hardware.

90%

Departmental green procurement target

By March 31, 2017, 95% of copy paper, commercial printing, and/or envelope purchases will contain a minimum of 30% recycled content and be certified to a recognized environmental standard to reduce the environmental impact of its production.

Performance indicator
Targeted performance level

Dollar value of copy paper, commercial printing and/or envelope purchases that meet the target objective relative to the total value of all copy paper, commercial printing, and/or envelope purchases.

90%


Implementation strategy element or best practice
Targeted performance level

7.2.1.5. Leverage common-use procurement instruments where available and feasible.

Seeking to reach “Achieved” status.

Best Practice
7.2.3. Train acquisition cardholders on green procurement.

Seeking to reach “Achieved” status.

Best Practice
7.2.4. Increase awareness of the Policy on Green Procurement among managers.

Seeking to reach “Achieved” status.

Target 7.3: Sustainable Workplace Operations

As of April 1, 2015, the Government of Canada will update and adopt policies and practices to improve the sustainability of its workplace operations.

Performance Measurement
Expected result

Departmental workplace operations have a reduced environmental impact.

Performance indicator
Targeted performance level

Approach to maintain or improve the sustainability of the departmental workplace in place as of March 31, 2015.

Completed March 31, 2015


Implementation strategy element or best practice
Targeted performance level

7.3.1.1. Engage employees in greening government operations practices.

Seeking to reach “Achieved” status.

7.3.1.3. Maintain or improve existing approaches to sustainable workplace practices (printer ratios, paper usage, and green meetings).

Seeking to reach “Achieved” status.

7.3.1.5. Select and operate IT and office equipment in a manner that reduces energy consumption and material usage.

Seeking to reach “Achieved” status.

7.3.1.6. Dispose of e-waste in an environmentally sound and secure manner.

Seeking to reach “Achieved” status.

5. Additional Departmental Sustainable Development Activities and Initiatives

The Department’s vision for sustainable development—"economic and fiscal policy frameworks and decisions that promote equity and enhance the economic, social and environmental well-being of current and future generations"—is consistent with its mandate to foster a strong economy. The Department's most important contribution to sustainable development lies in the development of advice and policies that ensure fiscal sustainability, that contribute to a high standard of living for future generations, and that help build strong social foundations. Through its work relating to tax policy and financial sector policy as well as in its central agency role, the Department can contribute to efforts to integrate sustainable development considerations into policy making. In addition, the Department can set an example for other organizations through a commitment to sustainable development in its operations.

The Department has established several goals, supplementary to those included in the FSDS, that focus on key areas where it can contribute to sustainable development. The Department has focused on making specific commitments in areas relating to its core mandate where it is the lead federal department or has a distinct role in areas where other departments lead the policy development. Each goal is accompanied by a set of objectives and commitments that the Department has made toward meeting those objectives.

Goal 1: Fiscal Sustainability and a High Standard of Living for Future Generations
Objectives Targets Planned Activities and
Implementation Plan
Linkage to Program Alignment Architecture
1a: Promote fiscal sustainability. 1a.1 Keep the federal debt-to-GDP ratio on a downward path. Modest deficits over the next three years to help grow the economy and a return to a balanced budget in 2019–20 will help ensure that the federal debt-to-GDP ratio remains on a downward path during these years and beyond.

The Department will continue to publish updated long-term fiscal analyses for the federal government on an annual basis.
Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.2: Economic and Fiscal Policy, Planning and Forecasting
1b: Monitor long-run economic and fiscal issues and prospects. 1b.1 Understand the long-run economic and fiscal implications of ongoing domestic and global developments. The Department will continue ongoing research and analysis concerning the long-run economic and fiscal implications of ongoing domestic and global developments. Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.2: Economic and Fiscal Policy, Planning and Forecasting
1b.2 Show leadership in discussions on the global economy and promote sustainable growth around the world. The Department will continue to support Canada in the co-chairing of the Working Group on the G20 Framework for Strong, Sustainable and Balanced Growth—an international leadership role it has shared with India since 2009.

The Department will help Canada contribute to global financial and economic stability, and establish the foundation for jobs and growth both in Canada and abroad.
Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.6: International Trade and Finance
1c: Develop and support policies and measures that promote the long-run sustainability of Canada’s economy. 1c.1 Provide analysis and advice to the Minister in support of a tax system that raises revenues in an economically efficient, fair and simple manner that is conducive to economic growth and improved standards of living. The Department will continue to advise the government on ways of maintaining internationally competitive statutory and effective corporate tax rates while improving the neutrality and efficiency of the business tax system. Continued incremental actions to improve the integrity, fairness and simplicity of the tax system will contribute to these objectives on an ongoing basis. Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.1: Taxation
1c.2 Support financial stability and maintain the safety and soundness of the financial system. The Department will promote a stable, efficient and competitive financial sector and strengthen the resolution regime for domestic systematically important banks; continue its review of the deposit insurance framework; and advance the effectiveness of Canada’s Anti-Money Laundering and Anti-Terrorist Financing Regime as well as the effectiveness of global efforts.

The Department will continue to work with participating provinces and territories to establish a cooperative capital markets regulatory system.
Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.5: Financial Sector Policy
Goal 2: Strong Social Foundations
Objectives Targets Planned Activities and
Implementation Plan
Linkage to Program Alignment Architecture
2a: Ensure stable and predictable funding for health and social programs. 2a.1 Provide timely and accurate payment of Canada Health Transfer (CHT) and Canada Social Transfer (CST) amounts. The Department will continue to focus on providing timely and accurate payments of renewed CHT and CST amounts to provinces and territories.

Communications activities will continue to focus on improving overall understanding of the programs.
Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.4: Federal-Provincial Relations and Social Policy
2b: Reduce fiscal disparities through Equalization and Territorial Formula Financing programs. 2b.1 Address fiscal disparities with timely and accurate payment of Equalization and Territorial Formula Financing (TFF) transfer amounts. The Department will continue to focus on providing timely, accurate payments of Equalization amounts to Equalization-receiving provinces and TFF amounts to territories.

Communications activities will continue to focus on improving overall understanding of the programs.
Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.4: Federal-Provincial Relations and Social Policy
2c: Ensure the sustainability of the retirement income system. 2c.1 Work with provinces and territories on a possible enhancement to the Canada Pension Plan (CPP). Federal-Provincial-Territorial Ministers of Finance are joint stewards of the CPP. The Department will work with provinces and territories on a possible enhancement to the CPP. Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.4: Federal-Provincial Relations and Social Policy
2c.2 Continue to work with provinces and territories to identify ways to help Canadians save more effectively for retirement. The Department will continue to assess the benefits of implementing a Target Benefit Pension Plan option and to support the implementation of a national financial literacy strategy.

The Department will continue to work with provinces to implement a multilateral agreement to streamline the supervision of Pooled Registered Pension Plans.
Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.4: Federal-Provincial Relations and Social Policy

Sub-Program 1.1.5: Financial Sector Policy
Goal 3: Integrating Sustainable Development Considerations into Policy Making
Objectives Targets Planned Activities and
Implementation Plan
Linkage to Program Alignment Architecture
3a: Evaluate the potential for the use of economic instruments as a policy tool for addressing environmental issues. 3a.1 Evaluate potential changes to the tax system that could contribute to the government’s environmental objectives, including tax proposals received from stakeholders. The Department will continue to evaluate tax proposals concerning environmental measures, including consideration of the relative effectiveness of tax measures compared with other instruments that may be available within the context of the government’s other fiscal and policy objectives. “A Framework for Evaluation of Environmental Tax Proposals,” published in Budget 2005, sets out general policy considerations that may be taken into account in the assessment of potential tax measures aimed at furthering the government’s environmental objectives.

The Department will continue to review, as appropriate, the accelerated capital cost allowance for clean energy generation equipment to ensure inclusion of appropriate technologies that have the potential to contribute to energy efficiency, diversification of the energy supply, and a reduction in emissions of greenhouse gases and air pollutants.
Program 1.1: Economic and Fiscal Policy Framework

Sub-Program 1.1.1: Taxation
3b: Increased knowledge and awareness of environmental and broader sustainable development issues within the Department. 3b.1 Organize at least one speaker annually on an issue related to sustainable development. To increase knowledge and awareness of sustainable development issues, the Department will organize at least one session with an external speaker on a sustainable development topic. Program 1.1: Economic and Fiscal Policy Framework
Sub-Program

1.1.3: Economic Development Policy
3b.2 Conduct research and analysis on environmental and natural resource issues. To increase awareness and understanding of current environmental and natural resource issues within the Department, research and analysis will continue to be conducted on an ongoing basis. Program 1.1: Economic and Fiscal Policy Framework
Sub-Program

1.1.3: Economic Development Policy
3c: Effective implementation of the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals. 3c.1 Organize an information session for Department of Finance Canada employees on Strategic Environmental Assessment (SEA). The Department will hold at least one  information or training session on SEA to ensure that all employees are aware of the rationale for, and benefits of, conducting SEAs; the Department’s procedures on SEAs; and the resources available to assist them in completing SEAs. Program 1.1: Economic and Fiscal Policy Framework
Sub-Program

1.1.3: Economic Development Policy
3d: Support implementation of Canada's international financing commitment under the Copenhagen Accord. 3d.1 Deliver $350 million in climate change-related financing through the International Finance Corporation. The Department will work with relevant organizations and departments to manage this initiative in support of Canada's international climate change efforts.

The Department will report on this initiative through existing Government of Canada reporting on Official Development Assistance, International Climate Change efforts, and the operations of the Bretton Woods and Related Agreements Act.
Program 1.1: Economic and Fiscal Policy Framework
Sub-Program

1.1.6: International Trade and Finance

6. Sustainable Development Management System

The Department of Finance Canada is the Government of Canada's primary source of analysis and advice on the broad economic and financial affairs of Canada. In addition to preparing the budget, the Department plays an important role in the development and implementation of government policy. As a central agency, the Department provides analysis and advice on the economic merit and fiscal implications of policy and program proposals developed by other government departments. For example, departmental officials serve as members of a broader team of federal officials that review options for, and the implications of, proposals that are presented to Cabinet. Policy development also takes place within the Department on those issues and areas of responsibility that fall within the Department's own mandate, including tax and tariff legislation, major federal transfers to provinces and territories, the legislative and regulatory framework for the financial sector, and Canada’s representation within international financial institutions.

As a policy-oriented department, the Department has limited direct involvement in delivering programs and services to Canadians. Nevertheless, the Department has a clear role to play in contributing to the government's sustainable development efforts. Sustainable development requires the long-term sustainability of the economy, social programs, the environment and natural resources. This requirement is consistent with the basic principle of sustainability as set out in the Federal Sustainable Development Act. Although the Department's mandate is most evidently linked to the economic and social pillars of sustainable development, the Department continuously strives to recognize the implications of its analysis and advice on all aspects of sustainable development and to take into account the linkages between economic, social and environmental sustainability. In some cases, economic, social and environmental goals can be advanced together. In other cases, trade-offs are needed, but with informed decision making and choices that reflect careful deliberation.

Economic growth is an important aim of sustainable development because it contributes to a high quality of life for Canadians, provides the fiscal capacity for governments to address environmental and social issues, and ensures that the Canadian economy remains strong in the face of long-term challenges, such as an aging population, the need to improve productivity, and globalization. For example, an aging population will bring future economic and fiscal challenges and put downward pressure on growth in living standards. By taking action now to ensure long-run fiscal sustainability and by identifying effective policies that encourage investment in the drivers of economic growth, such as human capital, physical capital and innovation, the government can help ensure a high standard of living for future generations. The Department addresses this challenge through responsible fiscal management, economic policy advice, sound framework policies, such as those related to taxation and the financial sector, and ongoing analysis of Canada's current and long-run economic and fiscal position.

The Department believes that safe, healthy and caring communities that provide all citizens with equal access to opportunities are vital to the creation of a strong, competitive, vibrant and sustainable economy and society. Sustainability in social policy is achieved by working with partners in other departments to identify policies that support investments in people and their communities; working in cooperation and collaboration with other levels of government, which often have the primary responsibility for these policy areas, to ensure policy consistency and, where appropriate, stable and predictable funding; and developing specific policies that support this goal, such as tax and financial sector policies.

Management and Accountability

The Department's Sustainable Development Champion in the Economic Development and Corporate Finance Branch is responsible for coordinating activities and reporting on departmental contributions to the FSDS and sustainable development more broadly.

The Resources, Energy and Environment Section of the Economic Development and Corporate Finance Branch, under the general direction of the Department's Sustainable Development Champion, coordinates departmental sustainable development management, policy and activities. The main coordination vehicle is the Sustainable Development Working Group (SDWG), which is made up of officials from all branches and is chaired by the Chief of the Resources, Energy and Environment Section. The SDWG is responsible for coordinating the implementation of commitments related to sustainable development within the various branches of the Department, and contributes to reporting on plans and progress related to these commitments.

FSDS Reporting

The Sustainable Development Office of Environment and Climate Change Canada is responsible for preparing government-wide FSDS Progress Reports at least once every three years. The first report was completed in April 2011 and tabled in Parliament in June 2011; a second report was tabled in February 2013. These reports offer an opportunity to assess progress in implementing the FSDS, to re-evaluate FSDS goals and targets, and to benefit from lessons learned. The Department contributes to government-wide progress reporting through its participation in the FSDS Assistant Deputy Ministers Committee and the Director Generals Committee, which are co-chaired by Environment and Climate Change Canada and by Public Services and Procurement Canada.

The Department evaluates its own contribution to sustainable development, including activities and initiatives supplementary to those captured in the FSDS, as part of the annual Report on Plans and Priorities and Departmental Performance Report processes.

7. Strategic Environmental Assessment

The Department of Finance Canada will continue to implement the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals, consistent with the revised guidelines released by the Canadian Environmental Assessment Agency in October 2010. The Department will continue to make available public statements of environmental effects relating to new departmental measures and policies on its Strategic Environmental Assessment (SEA) Public Statement website, and to ensure that these statements reflect the impact of the measures and policies on the achievement of FSDS goals and targets. The Department tracks the number of preliminary scans and full SEAs it completes and commits to report this information each year in its Departmental Performance Report.

The Department will continue to ensure that its decision-making process includes consideration of the FSDS goals and targets through the SEA process. An SEA for policy, plan or program proposals includes an analysis of the impacts of the given proposal on the environment, including on the FSDS goals and targets. The results of Department’s detailed assessment are made public when an initiative is announced. The purpose of the public statement is to demonstrate that the environmental effects, including the impacts on achieving FSDS goals and targets, of the approved policy, plan or program have been appropriately considered during proposal development and decision making.

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