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Archived - Supplementary Document to the Department's 2005-06 Report on Plans and Priorities (RPP) Regarding Implementation of the 2004-06 Sustainable Development Strategy (SDS)

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TargetServices - InfoSite (2004-06)

Activities anticipated within the coming year (05-06)


Key Issue 1: Building the Future
Objective 1a: Maintaining a Healthy Fiscal Climate

1a.1: Continue to pursue the Government's Debt Repayment Plan to ensure the federal debt-to-GDP (gross domestic product) ratio remains on a permanent downward track.

The target of keeping the federal debt-to-GDP ratio on a steady downward track continues to be a priority for the Government. According to the fiscal projections in Budget 2005, the federal debt-to-GDP ratio (accumulated deficit) will fall to 38.8 per cent in 2004-05 from 41.1 per cent in 2003-04, and to about 37.0 per cent for 2005-06. The Government has also set an objective of reducing the federal-debt-to-GDP ratio to 25 per cent within the next ten years.

This will be achieved by maintaining a prudent approach to financial management, which includes an annual target of a balanced budget or better, a Contingency Reserve, and economic prudence. The Contingency Reserve, if not needed, is used to reduce the federal debt.

As well, the Expenditure Review Committee (ERC) was established with a mandate to conduct a fundamental review of all programs and expenditures. The government's goal is to identify $12 billion in savings over a five-year time frame. These savings are intended for reinvestment in the priorities of Canadians. Most savings will be detailed in Budget 2005.


Objective 1b: Building a Stronger Society

1b.1: Ensure predictable and growing funding for health and social programs.

The Department will work to ensure that the planned increases in transfer payments resulting from the 10-year Action Plan to Strengthen Health Care agreed to by First Ministers in September 2004 will be implemented, upon passage of legislation.

These transfers and supporting targeted funding measures are designed to accelerate the reform of the health care system in order to ensure its sustainability over the long-term.

1b.2: Improve the transparency and accountability of federal transfer support to the provinces and territories.

As agreed to by First Ministers at the February 2003 First Ministers' Meeting, the Canada Health and Social Transfer (CHST) was restructured into two new block transfers effective April 1, 2004: a Canada Health Transfer (CHT) in support of health; and a Canada Social Transfer (CST) in support of post-secondary education, social assistance and social services, including early childhood development, and early learning and child care services.

Creating distinct transfers for health and other social spending will provide Canadians with greater information on the federal government's long-term contribution to both health care and other social programs. Therefore, this target has been achieved.

1b.3: Ensure fiscal disparities are addressed through the equalization and Territorial Formula Financing programs.

The Department will implement the new Equalization and TFF frameworks as agreed to by First Ministers in October 2004. In addition, the Government will launch a review of both Equalization and TFF by an independent panel of experts. This panel will report back its advice to the Government by the end of 2005. The Government is committed to having any changes in allocation for 2006-07 and future years in place by April 1, 2006. The Department will work to ensure this commitment is met.

1b.4: Ensure the retirement income system remains sustainable and meets seniors' needs.

The Department will provide supporting policy analysis to federal and provincial finance ministers to ensure timely completion of the triennial financial review of the CPP. The CPP legislation requires that ministers make "best efforts" to complete the review by the end of 2005.

The Department will prepare the annual report on the operations of the Canada Pension Plan in consultation with the Department of Social Development.

The Department will also implement the first of two increases in the maximum monthly Old Age Security Guaranteed Income Supplement for single seniors, senior couples and near senior spouses, partners, or survivors of GIS recipients (i.e., recipients of the Allowance and the Allowance for the Survivor benefits) on January 1, 2006 as announced in the 2005 Budget.

As well, the Department will implement the transfer of all CPP assets remaining with the federal government to the CPP Investment Board over a three-year period following the formal accord of provincial governments.


Objective 1c: Implementing Key Federal Environmental Sustainable Development Priorities

1c.1: In the context of planning for future budgets, work with other federal departments and stakeholders to identify ways to address environmental sustainable development priorities.

The Department will continue to participate in discussions with stakeholders and other federal departments at the earliest possible stages of budget planning. For instance, the Department will continue to meet with environmental non-governmental organizations, such as the Green Budget Coalition.

Departmental officials will also work closely with other departments in implementing previous budget measures, such as the $1 billion announced in Budget 2005 for an innovative Clean Fund to further stimulate cost-effective action to reduce greenhouse gas emissions.

1c.2: Work with other government departments to evaluate federal horizontal management of water policy.

Building upon key water priorities that were identified last year by relevant federal departments and agencies, Departmental officials will participate in ongoing policy discussions on federal management of water policy.


Key Issue 2: Integrating the Economy and the Environment
Objective 2a: Evaluating the Potential for and Developing Practical Uses of Economic Instruments

2a.1: Participate in further work in cooperation with other federal departments, other governments and stakeholders on the design of a system of covenants with the large industrial emitters sector to achieve reductions in their greenhouse gas emission intensities to help further Canada's climate change objectives under the Kyoto Protocol. Additionally, the Department will participate in work on potential mechanisms to facilitate a domestic and international permit-trading system.

Finance officials will participate in inter-departmental consultations relating to the development of a regulatory framework for large final emitters. Finance officials will also participate in interdepartmental discussions on mechanisms to facilitate emissions trading and other forms of market-based compliance options.

2a.2: Continue to participate in the Steering Committee and as observers at working group levels with the National Round Table on the Environment and the Economy on its Ecological Fiscal Reform program over 2003-2005.

Officials from the Economic Development and Corporate Finance (EDCF) Branch have participated in the NRTEE's Expert Advisory Group, a steering committee for the Ecological Fiscal Reform (EFR) program, and have acted as observers on various EFR working groups, including the most recent research program related to EFR and energy. The EFR and energy research program is nearing completion, and NRTEE will incorporate future EFR research into its other research programs. The Department will continue to participate in NRTEE Steering Committees as appropriate.

As announced in Budget 2005, the Government has asked NRTEE to develop options for a revenue neutral vehicle 'feebate' and to consult and make recommendations to the Government for the next federal budget. The Department will work with NRTEE and other parties and provide advice to the Minister on the follow-up to NRTEE's recommendations.

2a.3: Continue to undertake analysis and research concerning the economic and fiscal implications of population aging. Research and analysis on the economic and fiscal implications of aging is ongoing. Several research projects on aging will either be started and/or completed over this period. Subject topics to be explored include, among other things, the relationship between the age distribution of the population and productivity and the impact of public and private pensions on work incentive. Research output will be shared with other government stakeholders working on population aging and likely to be presented in academic forums.

2a.4: Continue to keep abreast of the emerging literature related to population aging and its economic and fiscal impacts; develop and employ analytical tools (such as computable general equilibrium models, microsimulation models and econometric methods) to examine impacts associated with population aging and provide analysis of current and proposed policies.

Ongoing efforts are made to keep abreast of the emerging literature related to population aging. Officials from the Economic and Fiscal Policy Branch will develop and employ analytical tools (such as computable general equilibrium (CGE) models, simulation models and econometric techniques) for the purposes of examining the impacts associated with population aging. Research output will be shared with other government stakeholders working on population aging and is likely to be presented in academic forums.

2a.5: Continue to evaluate research concerning environment-related tax measures. Assess the potential of proposals received from stakeholders for using the tax system to assist the Government in meeting its environmental objectives, with specific emphasis on the relative effectiveness of tax measures compared to other instruments that may be available within the context of the Government's other fiscal and policy objectives.

The Department will continue to evaluate research and proposals concerning potential environment-related tax measures. This is consistent with the Government's commitment in Budget 2005 to actively consider opportunities to use the tax system to support environmental objectives, in areas where it would be an appropriate instrument. The publication of the "Framework for Evaluation of Environmental Tax Proposals" in Annex 4 to the 2005 Budget Plan fulfils the Department's commitment in the 2004-06 Sustainable Development Strategy to make public such a framework. This document will facilitate dialogue by setting out general policy considerations that may be taken into account in the assessment of potential tax measures aimed at furthering environmental goals.

Following the enhancement in Budget 2005 of incentives for investment in efficient and renewable energy generation through accelerated capital cost allowance (Class 43.1), the Department will continue to review other equipment for potential inclusion in this measure.

As announced in Budget 2005, the Government has asked NRTEE to develop options for a revenue neutral vehicle 'feebate' and to consult and make recommendations to the Government for the next federal budget. The Department will work with NRTEE and other parties and provide advice to the Minister on the follow-up to NRTEE's recommendations. The Department will also monitor the take-up under the capital region transit authorities' Transit Pass Program to help the Government identify the most cost-effective way of encouraging public transit use.


Objective 2b: Increasing the Knowledge Base Through Integrated Decision Making

2b.1: Continue to maintain awareness of the departmental process for implementing the 1999 Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals (Strategic Environmental Assessment).

As part of annual SEA awareness-raising activities, which have been in place for over 2 years, the Department will:

  • request that CEAA provide a briefing on SEA to the Department's Sustainable Development Working Group (SDWG), which would also open to all officers;

  • after the briefing by CEAA, give a subsequent presentation to officials on the SEA process tailored to the specific role and activities of the Department; and,

  • make a report to the Departmental Coordinating Committee on the state of SEA implementation within the Department.

As well, the Government of Canada response to the 2004 report of the Commissioner of the Environment and Sustainable Development committed to ensuring that appropriate management systems are put in place by December 2005. In light of this, the Department will examine its current system to determine if any potential areas of improvement exist.

2b.2: Conduct research and analysis on environmental and natural resource issues.

Research will continue to be targeted towards upcoming environmental and natural resource policy concerns. This research will be made available within the department through, for example, seminar-style presentations.


Key Issue 3: Integrating Sustainable Development in the Global Economy
Objective 3a: Participating in Negotiating International Environmental Agreements

3a.1: Support initiatives to enhance the understanding of linkages between Multilateral Environmental Agreements and trade rules.

Finance officials will continue to participate in the development of the Canadian position for Canada's participation in the work of the Committee on Trade and Environment (CTE) of the World Trade Organization (WTO).

3a.2: Collaborate with other government departments on Canada's ongoing approach to international negotiations and activities on climate change, focusing primarily on economic and fiscal issues under negotiation.

The Eleventh Conference of Parties to the United Nations Framework Convention on Climate Change will be hosted by Canada in December 2005. This meeting will mark the launch of discussions on the framework for addressing climate change after the Kyoto Protocol's first commitment period of 2008-12. In addition, the UK, as chair of the G-8, has indicated that climate change is a key priority for consideration. Finance officials will assist with the development and analysis of considerations for Canada's approach to discussions in both these venues, focusing primarily on the analysis of economic and fiscal matters.


Objective 3b: Integrating the Environment Into Future Negotiations on Trade and Investment Agreements

3b.1: In conjunction with the Department of Foreign Affairs and International Trade (DFAIT), examine trade and environment linkages in the context of the World Trade Organization and trade negotiations.

Finance officials will continue to participate in the Environmental Assessment of Trade Negotiations Steering Committee chaired by Foreign Affairs Canada.

3b.2: With DFAIT and Industry Canada, strive to promote free trade in the environmental sector and continue to review specific requests to remove tariffs unilaterally where they are identified as a significant disincentive to the acquisition of environmental technology products. The Department continues to actively support the reduction or elimination of tariff and non-tariff barriers on environmental goods and services in the WTO Doha round.

Objective 3c: Involving International Financial Institutions

3c.1: Work with other donor governments during the 14th replenishment of the World Bank/International Development Association's (IDA14) financing for the world's poorest countries to ensure that sustainable development issues remain high priorities (the replenishment negotiations are expected to begin in early 2004, with the three-year replenishment period to become effective in July 2005).

The IDA14 negotiations are near completion. The Department will work with other donors to ensure that IDA14's operating strategy acknowledges the importance of sustainable development.

3c.2: Undertake consultations in 2004 with interested Canadian non-governmental organizations to exchange views on how best to support sustainable development within the IDA14 negotiations and within the international financial institutions more broadly.

The Department has met its target of undertaking consultations with interested Canadian NGOs in regard to the IDA14 negotiations. It will continue to consult with NGOs in 2005-06 on supporting sustainable development at the international financial institutions, particularly as the institutions prepare for the Millennium Review Summit and as the World Bank Group implements its response to the Extractive Industries Review.

3c.3: Work with the Executive Boards of the World Bank and European Bank for Reconstruction and Development to support operations that promote sustainable development.

The Department will continue to work with the Executive Boards of the World Bank and the European Bank for Reconstruction and Development to support operations that promote sustainable development.


Objective 3d: Increasing knowledge and understanding of the relationship between financial services and international environmental practices

3d.1: Participate in upcoming events such as the annual UNEP Finance Initiative Global Roundtable and other corporate social responsibility events.

The Department will continue to attend conferences and events that increase our knowledge of international environmental practices as they relate to the financial sector. Examples may include the 2005 Corporate Social Responsibility Conference in May 2005 organized by the Conference Board of Canada, and the Globe 2006, organized by the Globe Foundation of Canada that will be held in March 2006.


Objective 3e: Maintaining a dialogue with federal financial institutions on sustainable development and corporate social responsibility with a view to continually improving the annual Public Accountability Statements 

3e.1: Maintain open dialogue with representatives of financial institutions on Public Accountability Statements.

The Department will continue to monitor Canadian financial institutions reporting in the Public Accountability Statements, particularly with regards to corporate social responsibility issues, with a view to continuing the open dialogue initiated in recent years, and to support financial institutions in their SD reporting activities.


Objective 3f: Informing and educating others interested in sustainable development on the merits of the Public Accountability Statements

3f.1: Participate in various interdepartmental and external events.

The Department will provide input on sustainable development/corporate social responsibility initiatives pertaining to financial institutions led by other federal departments.


Key Issue 4: Greening Operations

Objective 4a: Enhancing awareness of the environmental impacts of our operations and encouraging employee and management adoption of best practices

4a.1: Increase the proportion of employees participating in the ongoing promotion of SD principles in the workplace to 20 per cent by 2006.[1]

The Green Citizenship Network (a group of environmentally conscious employees of the Department of Finance, the Treasury Board Secretariat, the Public Service Human Resource Management Agency and the Public Service Commission) will develop a business case to green departmental operations and present it to senior management for approval.

The Department will continue to identify new opportunities for developing best practices and new green policies for procurement, facilities and fleet management.

The Department will continue to promote Earth Day and Environment Week with a variety of interactive displays and events, as well as promote other government-wide awareness initiatives such as the One Tonne Challenge.

4a.2: Increase the number of requests for materials on greening initiatives, policies and achievements by 30 per cent by 2006.[2]

The Department will continue to develop online resources and promote the use of greening materials posted on the InfoSite.

A green office awareness module will be developed and incorporated into the orientation session for new employees.


Objective 4b: Developing tools and guides and maintaining existing programs to support the implementation of best practices

4b.1: Develop a tracking system to determine the baseline and benchmarks for the recommendation of environmentally preferred products and services by 2006.

The Department will begin collecting green procurement data to establish a baseline for the procurement of environmentally preferred products and services.

4b.2: Develop and implement a strategy to reduce resource consumption by 2005. A Strategy to reduce resource consumption will be drafted and presented to senior management for approval.

1 From a 12-per-cent baseline of employees who participated in a Finance-endorsed event in 2003. [Return]

2 From a baseline of 1,300 requests for information on the Greening the Office intranet site in 2002-03. [Return]