Appropriation Bill No. 4, 2020-21
Third Reading
December 10, 2020
Moved third reading of Bill C-16, An Act for granting to Her Majesty certain sums of money for the federal public administration for the fiscal year ending March 31, 2021.
She said: Honourable senators, thank you for this opportunity to discuss the 2020-21 Main Estimates.
Canadians and parliamentarians have the right to know how public funds are being spent and the right to hold the government to account for that spending.
That’s why the government is committed to providing meaningful information on the government’s finances and the expected outcomes of its investments.
Before I get into the main points, I would like to sum up the timeline that the budgetary cycle followed this year.
If you recall, on February 27, 2020, the President of the Treasury Board tabled the Main Estimates 2020-21, which provides the information for the total planned budgetary expenditures of $304.6 billion.
In March, the government presented the first interim supply bill, which Parliament passed in order to provide funding for departments to operate from April to June.
Then on April 20, in response to the situation in Parliament caused by the COVID-19 pandemic, the House of Commons adopted a motion to temporarily amend Standing Order 81 of the House of Commons. That made it possible to extend the study of the Main Estimates until December.
In June, a second appropriation bill was tabled and passed by Parliament to cover the activities of federal departments from July to December.
In September, after the prorogation of Parliament and the opening of a new session, the Main Estimates 2020-21 was tabled a second time in the House of Commons.
The objective was to allow Parliament to continue to examine the planned budgetary expenditures for 2020-21 before approving a final appropriation bill for the remainder of the Main Estimates in December.
The Main Estimates document that was retabled on September 30, 2020, is the same as the one tabled on February 27, 2020. By retabling these Main Estimates at the start of the second session of Parliament, the government reaffirmed its commitment to the sound management of public funds in an open and transparent manner.
Honourable senators, as I mentioned, these Main Estimates include the following priorities: creating opportunities for citizens from coast to coast to coast; advancing reconciliation with Indigenous peoples; addressing climate change and protecting our environment; reinforcing our nation’s infrastructure; supporting the men and women of the Canadian Armed Forces; and ensuring Canada continues to play a prominent and constructive role on the international stage.
Through these spending plans, the government is asking Parliament to authorize expenditures from 122 federal organizations to maintain existing programs and services delivered by these departments and agencies for the coming fiscal year.
I would add that these Main Estimates reflect the government’s base spending plans.
Incremental changes to spending plans, including the government’s response to COVID-19, have been and continue to be reported in supplementary estimates throughout the fiscal year.
Details on how departments and agencies plan to use financial allocations, as well as their targets and expected results, are available in the annual departmental plans which were tabled in Parliament on March 10, 2020.
Overall, the Main Estimates detail total planned budgetary expenditures of $304.6 billion. This represents a 1.6% increase in total funding requested over the 2019-20 Main Estimates. Of this total, $125.1 billion relates to budgetary voted expenditures and $179.5 billion to statutory budgetary spending, which I’ll turn to later.
With respect to budgetary voted expenditures, I would first like to point out that the amount of budgetary voted expenditures is slightly lower, by nearly half a billion dollars, than what was presented in the 2019-20 Main Estimates last year.
Among the 122 organizations presenting funding requests, 6 are asking for more than $5 billion in budgetary voted authorities, for a total of $58.5 billion, or approximately 47% of the total budgetary voted expenditures.
This total includes the following amounts: $21.8 billion for the Department of National Defence; $12.7 billion for the Department of Indigenous Services; $7.1 billion for the Department of Foreign Affairs; $6 billion for the Treasury Board Secretariat; $5.7 billion for the Office of Infrastructure of Canada; $5.2 billion for the Department of Veterans Affairs.
Dear colleagues, as Parliament continues to examine the Main Estimates and related documents, it will become clear that the government’s expenditure plan mirrors the priorities expressed by Canadians.
Naturally, this requires that Canada keep moving forward on reconciliation with Indigenous peoples. I am obviously referring to the fundamental importance of guaranteeing the right of Indigenous peoples to have access to the same opportunities and services that non-Indigenous Canadians take for granted.
Closing the unacceptable socio-economic gap separating Indigenous and non-Indigenous peoples in this country is essential to achieving this reconciliation. Our planned spending therefore includes a total of $5.4 billion for Indigenous health and social services. These expenditures are essential to building stronger, healthier communities, and they are even more essential to ending decades of shameful discrimination in the delivery of these vital services to Indigenous peoples.
An additional $2.4 billion will support the exercise of Indigenous peoples’ inherent right to self-determination in the design and delivery of these and other services.
Each and every child in this country must have access to quality education. The estimates provide for significant funding to support Indigenous students at all levels, increase access to early learning opportunities and continue to advance Indigenous self-determination in education.
Colleagues, the Main Estimates demonstrate the spending required to maintain the programs that are envied by so many around the world. It supports measures to advance human rights, combat climate change and diversify Canada’s trade and investment opportunities. This includes $4.8 billion for international development, peace and security programming and $1.1 billion to support Canada’s presence abroad.
As well, as we have seen during the COVID-19 pandemic, Canada must be prepared to support its citizens at home and abroad. Therefore, the Main Estimates include $52.5 million to help Canadians when they may be in difficulty in another country. Our planned international spending assistance also targets the empowerment of women and girls around the world.
Colleagues, Canadians also take great pride in our Armed Forces. The Main Estimates, therefore, include plans to invest significant amounts to ensure that these men and women have the equipment and support they need to respond effectively to emergencies at home and to join our allies in protecting global security. These expenditures include investments in major capital projects under the Strong, Secure, Engaged defence policy, such as the Canadian Surface Combatant, fixed-wing search and rescue aircraft replacement and the Armoured Combat Support Vehicle fleet.
For example, the fixed-wing search and rescue aircraft replacement involves the procurement of 16 CC-295 aircraft equipped with advanced technology systems and opening a new training facility in Comox, British Columbia.
The Armoured Combat Support Vehicle project involves the procurement of 360 vehicles, which will be delivered beginning in late 2020. The last vehicles are to be received in 2025. These vehicles will support a range of operations, which include domestic disaster relief and overseas peacekeeping missions.
Colleagues, the government also recognizes the sacrifices made by Canadian veterans and their important contributions to Canada and the world.
The funding plans laid out in these Main Estimates include improved online services and support for veterans and their families, including pain and suffering compensation and income replacement benefits.
The government will keep taking steps to improve the health and well-being of Canada’s veterans and to provide them with the benefits and services they are entitled to.
The government is also working hard to build a stronger, safer Canada in other ways. The Main Estimates lay out a total of $7.9 billion in public infrastructure investments through the Canada Infrastructure Bank and Infrastructure Canada.
That amount includes funds to support the economic, environmental and community infrastructure priorities of other levels of government, such as repairing and upgrading basic municipal infrastructure and carrying out major public transit projects.
The government is committed to ongoing collaboration with all other levels of government and other partners to build the Canada of the 21st century.
By supporting these kinds of projects, we are recognizing that the environment and the economy go hand in hand. Public transit, for example, makes our cities more efficient and more livable and helps reduce emissions. That is why these spending plans include $845.3 million for Environment and Climate Change Canada to take action on clean growth and climate change. An additional $360.4 million will enable the department to carry out its responsibilities with respect to preventing and managing pollution.
Colleagues, I would also draw your attention to the amount of $2.2 billion in the Main Estimates to support Treasury Board operations as the employer of Canada’s professional public service.
As well, there are central votes essential to helping the government address pressing issues and expedite the implementation of programs and services in a responsible manner. These include $750 million for the Treasury Board vote 5, related to government contingencies. This provides for miscellaneous, urgent or unforeseen expenditures that are not otherwise provided for in the authorities approved through departmental votes. Planned Treasury Board related expenditures also include a contribution of $282,000 to the Open Government Partnership.
Canada has been a member of the Open Government Partnership since 2012, and served as its chair in 2018-19. With 78 member countries, this international partnership is the leading global forum for advancing open government: a vibrant network dedicated to making governments more transparent, accountable and participatory.
Honourable senators, we all share a concern over emerging threats to democracy, the spread of disinformation and the need to meet citizens’ rising expectations for access to information held by their governments. We’re all aware of the negative impacts of the rise in so-called “fake” news, hateful speech and privacy violations. The member countries of the Open Government Partnership work to reduce these negative impacts and increase the ways technology can be used to increase accountability and public participation.
Canada, of course, stands with them in defence of democracy worldwide.
Honourable senators, before I conclude, allow me to briefly mention, simply by way of information, the projected statutory spending, which is also set out in detail in the Main Estimates.
The statutory budgetary spending is $179.5 billion, an increase of approximately $5.4 billion compared to the previous Main Estimates.
That amount includes elderly benefits, transfers to the provinces and territories, and public debt charges. It does not include benefits paid out under the Employment Insurance operating account or spending governed by the Income Tax Act, such as the Canada Child Benefit.
Here are a few of the significant changes to the 2019-20 statutory budgetary spending: increased major transfer payments, as outlined in the Economic and Fiscal Update 2019, including elderly benefits, fiscal equalization and the Canada Health Transfer; the implementation of climate action incentive payments; a decrease related to the one-time top-up transfer to the federal Gas Tax Fund in 2019-20; and lastly, a decrease in interest on unmatured debt.
Furthermore, statutory non-budgetary spending of $3 billion is planned for loans, investments and advances. That is an increase of approximately $750 million compared to the previous year, and it reflects the increase in incentives for rental housing construction and the First-Time Home Buyer Incentive.
Colleagues, the investments in these Main Estimates reflect the values of Canadians — humane and progressive values that we all cherish. By debating and adopting these estimates, we continue our contribution to Canada’s open and prosperous democracy. Thank you. Meegwetch.
Thank you, Senator Gagné, for your comments on Bill C-16.
Honourable senators, Bill C-16 is the final instalment of the Main Estimates funding for government departments and agencies for this fiscal year.
The Main Estimates, which were tabled in March, sets out $125 billion in voted expenditures.
Departments and agencies have already received about nine twelfths of their Main Estimates funding in two previous supply bills. This is the final instalment of Main Estimates funding in the amount of $26 billion. The amount provided to each entity varies from $263,000 for the Northern Pipeline Agency to $5.4 billion for the Department of National Defence.
In addition to the remaining Main Estimates funding provided by Bill C-16, additional funding is also provided to some departments and agencies through Supplementary Estimates (B) as authorized by Bill C-17, which we just discussed a few moments ago. Supplementary Estimates (B) is requesting $21 billion.
Both bills, Bill C-16 and Bill C-17, are now before us this evening in this chamber.
This year, the Senate Finance Committee studied the Main Estimates and Supplementary Estimates (B) together, so the report tabled by Senator Mockler on Tuesday provides information on our study of both the Main Estimates and the Supplementary Estimates (B).
Our Finance Committee report is very detailed, and I thank Senator Mockler, Senator Forest and Senator Pate for their speeches yesterday. I will not repeat what is in the report but will focus on the challenges of reviewing the government’s spending plans.
In previous years, I have discussed the challenges and difficulties of linking new spending initiatives, such as budget initiatives, to the Main Estimates and the supplementary estimates documents. To address some of these issues, the government had initiated an estimates reform project in recent years but has now cancelled or discontinued the project. Pilot projects were implemented in two fiscal years, and there were some noticeable improvements for those two years. However, the problem of tracking new spending initiatives, including the COVID-19 initiatives, remains.
In addition, difficulties in obtaining information on individual departmental programs persist. For example, I have often spoken on the capital spending program of the Department of National Defence and how it is impossible to track their capital spending in the estimates and supplementary estimates to their spending plan in their Strong, Secure, Engaged defence policy.
This year, new challenges — or perhaps I should say problems — arose with tracking COVID-19 spending of the government. Honourable colleagues will recall that I previously indicated on numerous occasions that the government has failed to provide parliamentarians with the financial information they need to provide parliamentary oversight. Information that is provided is often dated, disjointed and provided in various locations, and information is often simply not provided. The problem has persisted to a greater degree since the COVID-19 programs have been implemented.
I have made numerous requests for information.
For example, on October 29, in this chamber, I asked Senator Gold why the government was refusing to provide current financial information to parliamentarians and Canadians in general. I specifically referenced the COVID-19 biweekly reports which the government ceased providing in early August.
On November 12, the Minister of Finance appeared before the National Finance Committee to discuss Bill C-9. At that time, I indicated to her that there was no requirement within that bill to publicly provide any financial or program information on the two programs, which were the subject of the bill, specifically, the wage subsidy program and the rent subsidy program.
I also told her that the biweekly COVID reports, which had provided some information on the COVID-19 programs, were discontinued on August 6 and that program and financial information were very much lacking. In fact, I told her that the lack of program and financial information is the biggest issue I have.
The President of the Treasury Board also appeared before the National Finance Committee on December 1 to discuss the Main Estimates and Supplementary Estimates (B). At that time, I asked him why he had not provided us with all the financial information we need as parliamentarians to do our jobs.
The estimates documents, which were the subject of those discussions, do not provide estimates of all government spending, and in order to track expenditures and match them up with the estimates or vice versa, we have to research The Fiscal Monitor, ministerial remarks, websites of Crown corporations, proceedings of committees of the House of Commons, reports of the Parliamentary Budget Officer and so on. Neither the Minister of Finance nor the Treasury Board President satisfactorily responded to my questions.
While Supplementary Estimates (B), and Supplementary Estimates (A) before them, include many COVID-19-related expenditures, it is not a complete accounting of these expenditures. I would like to summarize some of the problems encountered.
The Department of Employment and Social Development is requesting $28 billion for the Canada Emergency Response Benefit, or CERB, as we call it, in Supplementary Estimates (B). This is in addition to the $60 billion approved in Supplementary Estimates (A), for a total estimated cost of $88 billion.
However, CERB was transitioned to the EI program in September. The most recent Fiscal Monitor provided by the Department of Finance for September has now split the cost of the CERB program so that payments to individuals eligible for EI previously reported as CERB have now been reclassified as Employment Insurance benefits. While Supplementary Estimates (A) and (B) enable us to track the estimated cost of the CERB program, as well as program information such as the number of applicants, et cetera, this information is no longer being disclosed as of September 30.
Another example occurred last month when we passed Bill C-9, which authorized two COVID-19 programs: The Canada Emergency Wage Subsidy, and the Canada Emergency Rent Subsidy. The costs of these programs do not show up in the supplementary estimates because they are considered tax expenditures. High-level information on the wage subsidy program is disclosed in The Fiscal Monitor and on the Canada Revenue Agency website, but there is no information on the rent subsidy program in either The Fiscal Monitor or on the Canada Revenue Agency website.
A third example is the Canada Emergency Commercial Rent Assistance program, which was administered by the Canada Mortgage and Housing Corporation. It was announced in April and was initially estimated to cost $3 billion, but as of July, only $367 million of the $3 billion had been allocated. The last COVID-19 biweekly report in August indicated $644 million had been allocated to businesses, and then I saw nothing until I saw a press release on November 2, which stated that $2 billion had been paid to assist 138,000 businesses. However, there was no program or financial information available on an ongoing basis. This lack of information was raised with CMHC officials when they testified on Bill C-9. They indicated that they had met their reporting obligations by daily reporting to the Department of Finance and the Privy Council Office and weekly reporting to the provinces and territories. There is no consideration for giving information to parliamentarians.
Since the Canada Emergency Rent Subsidy program will now be administered by the Canada Revenue Agency, their officials assured us at committee that they would be providing information similar to the wage subsidy program. However, this information has yet to appear on their website.
Honourable senators, given the lack of information being provided by government, many parliamentarians are turning to the Parliamentary Budget Officer for information. Last month, the Parliamentary Budget Officer released a report on Supplementary Estimates (B). In that report, he concludes that:
. . . the amount of information that is publicly available to track this spending is lacking, thus making it more challenging for parliamentarians to perform their critical role in overseeing Government spending and holding it to account.
He further concludes that:
. . . there is currently no public document published by the Government which provides a complete list of all measures announced to date, or updated cost estimates. There is also no consistency to which organizations publicly report on the implementation of these measures.
In addition, the supplementary estimates that we studied at the Finance Committee do not include all the planned spending, since the document only provides details of organizations which make payments from the Consolidated Revenue Fund.
Some of the measures not included in Supplementary Estimates (B) are the Canada Emergency Wage Subsidy, the Business Credit Availability Program, the Canada Emergency Business Account, the enhanced benefits provided through the Employment Insurance Operating Account and the new benefits enacted in October 2020 through the Canada Recovery Benefits Act.
In his report on Supplementary Estimates (B), the Parliamentary Budget Officer makes an interesting observation. He discloses that:
While not all COVID spending is made public, federal departments and agencies are required to update the Government’s Central Financial Management and Reporting System with actual spending data on a monthly basis.
In other words, the information that I’m looking for as a parliamentarian is available. The government just isn’t providing it.
In addition to the direct COVID-19 spending reflected in Supplementary Estimates (A) and now Supplementary Estimates (B), the government has also provided liquidity support measures to targeted populations, many of which are delivered through Crown corporations.
These measures would include loans, guarantees and deferred tax payments and are generally repayable. However, they do impact the government’s exposure to risk because government is the sole shareholder of each of these corporations. Any gains or losses in these Crown corporation programs could affect the federal government’s bottom line. There are currently five Crown corporations providing liquidity support: The Bank of Canada, Farm Credit Canada, Export Development Canada, Business Development Bank of Canada and Canada Mortgage and Housing Corporation.
The Bank of Canada has put in place a number of COVID-19 programs for the federal government, the provinces, financial institutions and corporations, primarily to provide liquidity. However, the Bank of Canada is unique in that it publicly reports on a weekly basis the status of its liquidity supports. So the weekly growth in the Bank of Canada’s balance sheet as a result of their COVID-19 programs is easily accessible on their website, and officials are available to answer inquiries.
Information on the COVID-19 programs of the other four Crown corporations had been provided in the biweekly COVID-19 reports. However, as noted previously, the government ceased providing this information as of August 6. As a result, financial and program information on the COVID-19 programs of these Crown corporations is lacking.
In October, the Parliamentary Budget Officer released a report on Crown corporations’ COVID-19 liquidity support, indicating that the increases in liquidity supports by those four Crown corporations have provoked questions from several parliamentarians regarding the budgetary risks associated with these financial commitments.
In his report, the Parliamentary Budget Officer indicated that the liquidity supports for the Crown corporations — and I’m not referring to the Bank of Canada here but the other four Crown corporations — represent extraordinarily large expansions of their financial operations in the billions of dollars. He concluded that the public reporting on the probable or potential budgetary costs of these liquidity supports has been lacking.
He also said that the government, within its economic and fiscal snapshot in July — the current fiscal update came after this report — included estimates for the net profits or losses expected on these liquidity measures but they were combined with other activities, so there was only a net amount.
He went on to say that, upon request, Finance Canada provided him with the five-year profile for aggregate gains and losses for enterprise Crown corporations on a confidential basis. In other words, additional information is available but, again, it will not be provided to parliamentarians.
Honourable senators, last weekend, I read an article about a CBC investigation — and I have read several since then — on the billions of dollars that the federal government handed out during the first eight months of the pandemic and the lack of details surrounding the programs. The article indicated that CBC had compiled the figures from federal government websites, corporate financial reports, the Office of the Parliamentary Budget Officer, and through access-to-information requests. Yes, I can confirm that the CBC did not get all their information from the Government of Canada, because the government quite simply has refused to disclose it.
Kevin Page, our former Parliamentary Budget Officer and now head of the University of Ottawa’s Institute of Fiscal Studies and Democracy, says that the numbers disclosed in November’s fiscal update are estimated numbers and not the actual monies that are going out the door.
Honourable colleagues, I have been requesting program and financial information on the COVID-19 programs for several months. CBC’s investigation included a search of corporate reports filed by 2,000 corporations. I have made several conclusions based on those reports.
The CBC article also cited costs associated with PPE-related expenditures and cites costs per type of equipment. It is a sad state of affairs when parliamentarians have to resort to CBC to obtain information on COVID-19 spending.
CBC related an interesting exercise in their article with which I can relate. For example, in seeking information on the “one-time, tax-free payment for seniors,” CBC said they had to follow a maze of websites of the Office of the Parliamentary Budget Officer, spreadsheets and legislative costing notices that provided three different totals for the program, ranging from $2 billion to $2.5 billion. That is the sort of exercise I do when I’m trying to track expenditures.
That experience is consistent with my experiences when information has to be gleaned from the website of the Office of the Parliamentary Budget Officer, the departmental website, Crown corporation websites, ministerial briefing notes and other sources deemed reliable.
Even former Parliamentary Budget Officer Kevin Page, who worked within government for many years, says he can hardly make sense of the recent 223-page fall economic update. He said, “It’s impossible to read. I have done this for years and I can’t even follow the money.” He wonders if someone in government is actually trying to obscure the data. “I hope it’s not deliberate,” he said.
In closing, I refer my honourable colleagues to the Finance Committee report on Bill C-9, which was adopted last month, and our report on Main Estimates and Supplementary Estimates (B), adopted by the Senate yesterday.
The Finance Committee, in reporting on Bill C-9, recommended that the government reinstate the publication of the biweekly COVID-19 report and publish timely, monthly updates on all of its COVID-19 programs. The Finance Committee also recommended that the government identify indicators to assess the performance of its financial support programs, providing timely and meaningful data on actual results.
The Finance Committee report on Main Estimates and Supplementary Estimates (B), which was approved yesterday, further recommends that the federal government provide clear and consistent monthly reports on the costs and performance of all its COVID-19 programs.
Honourable senators, it is time for the federal government to implement the recommendations of the Standing Senate Committee on National Finance. Parliamentarians and Canadians should not have to seek this information from sources outside government.
In closing, I refer colleagues to the Finance Committee report on Bill C-9 and our report on Main Estimates, adopted by the Senate yesterday.
Honourable senators, the government should stop talking about transparency of spending and start being transparent about its spending. Thank you very much.
Are senators ready for the question?
Is it your pleasure, honourable senators, to adopt the motion?
Some Hon. Senators: Agreed.
An Hon. Senator: On division.
(Motion agreed to and bill read third time and passed, on division.)