VII Business planning and the expenditure management
This section provides a brief overview of the objectives and requirements of business planning and the expenditure management system, and an overview of the Budget and Estimates cycle.
1. Business Planning
Departments and agencies must prepare and submit Business Plans to the Treasury Board for approval. These plans serve as strategic working documents of benefit to Ministers, Deputy Ministers, and the Government as a whole, inform planning and future priorities, and set the framework for measuring results and performance. Business Plans provide insight and information to the Treasury Board Secretariat. In turn, the Treasury Board Secretariat can provide advice to the Treasury Board and inform Cabinet to assist it in its decision-making.
A principal objective of the Business Plans is to create a strategic framework within which financial and non-financial performance information can be considered outside of the public sphere. Such integration will provide a better capacity in departments and agencies to manage resources and planning. It will also strengthen the portfolio cohesion and afford better horizontal issue management and analysis. For the government as a whole, integration of financial and non-financial information in the Business Plans will support the linkage of results to expenditures and then to policy development.
In general terms, Business Plans should demonstrate the department or agencys progress to date against past plans or commitments, with an assessment of that progress, including information on the major inhibitors or other influences on programs. The Business Plans should discuss the relevant elements of change in the environment including new policy approvals, external circumstances and other factors that influence results commitments. As the principal communication between the responsible Minister and the Treasury Board, the Business Plan should outline the Ministers intended results, the strategy for achieving them and the measurement thereof. The Business Plan provides an important opportunity to discuss what the department/agency needs from the Treasury Board by way of, for example, technical help and expertise, standards, authorities, policy changes, human resource strategies and authorities, and resources.
2. Citizen/Client-Centred Service Delivery
The government has adopted a citizen-centred service improvement strategy that will focus on the needs of citizens rather than bureaucratic needs. This involves developing service improvements plans for each department and agency, horizontal integration of service across federal departments and agencies and clustering services from all levels of government for the benefit of citizens.
Departments and agencies should develop service improvement plans, based on citizen/client priorities, that set out specific initiatives and results to be achieved, including consideration of service quality initiatives, alternative means of program delivery, regulatory efficiency measures and other management reforms that can advance the governments agenda.
In reporting documents, the departmental or agency head should report on steps being taken:
- to improve the quality of services delivered and to measure citizen/client expectations and satisfaction with the services delivered;
- to track over time improvements in citizen/client level of satisfaction and the progress made;
- to use information technology to improve service levels, accessibility and efficiency;
- where appropriate, to take advantage of alternative service delivery options and single window approaches to service delivery, including partnerships with other departments and levels of government or between the public private community sectors; and
- to establish and implement service standards, including progress made and objectives for future developments.
The government has issued a compelling challenge to departments and agencies to provide leadership on how services are delivered to Canadians and to innovate in service delivery.
3. The Expenditure Management System of the Government of Canada
The objective of the Expenditure Management System is to help the Government make responsible spending decisions by delivering the programs and services Canadians need in a way that they can afford and by meeting the required fiscal targets.
The Expenditure Management System requires the ongoing review of programs and spending to reduce expenditures and identify opportunities for reallocation to higher priority programs. It provides for parliamentary and public input into the Budget and expenditure planning process. It enhances accountability through a focus on performance and better public information. It also introduces better long-term strategic planning and the adjustment of programs and services to available resources through the implementation of departmental Business Plans.
4. Parliamentary Authority on Government Expenditures
The right of Parliament to control public money is set out in Canadas Constitution and is based on two concepts: first, that all duties and revenues received "shall form one Consolidated Revenue Fund (CRF)", and second, that the balance in the CRF "shall be appropriated by the Parliament of Canada". The effect of these two constitutional measures is to provide the Parliament of Canada with the indisputable right to require the Government to deposit all public moneys into the CRF, and before making a payment out of the Fund, to obtain parliamentary authority.
This authority, which is sought by the Government in the form of an Appropriation Bill, defines the amounts and purposes for which public money can be lawfully spent by the Government, including the right to access public funds through the business of supply.
5. The Budget and the Estimates
The Budget outlines the Governments total spending plans for the year. Under current practice, the Minister of Finance presents the annual Budget just prior to the tabling of the Main Estimates, on or before March 1. The purpose of the Estimates, which are tabled by the President of the Treasury Board, is to provide detailed information in support of the Governments Appropriation Bill.
The Estimates include:
- Part I: the Government Expenditure Plan, which provides an overview of federal spending. It describes the relationship of the Estimates to the Expenditure Plans (as set out in the Budget), summarizes key elements of the Main Estimates, and highlights the major year-over-year changes by department, agency and Crown corporation.
- Part II: the Main Estimates, which directly support the Appropriation Act. It lists in detail the resources that individual departments and agencies require for the upcoming fiscal year to deliver the programs for which they are responsible. This document identifies the spending authorities (votes) and the amounts to be included in subsequent appropriation bills that Parliament will be asked to approve to enable the government to proceed with its spending plans.
- The Reports on Plans and Priorities*, one for each department and agency of government, provide additional detail on each department and its programs, primarily in terms of more strategically-oriented planning and results information with a focus on outcomes.
- The Departmental Performance Reports* provide a focus on results-based accountability by reporting on accomplishments achieved against the performance expectations and results commitments as set out in the spring Report on Plans and Priorities and elsewhere. The reports provide the latest performance evidence on departmental effectiveness to guide future planning.
In the Estimates, the Government seeks Parliaments approval for mature and well developed spending proposals. As circumstances change and new priorities develop however, new spending requirements arise during the fiscal year. Accordingly, funds are provided for such contingencies in the fiscal framework established by the Minister of Finance in his Budget. As these needs arise, they are reviewed and approved by Treasury Board Ministers and advanced to Parliament for approval in the form of a Supplementary Estimate.
Supplementary Estimates are used to present to Parliament details about the changes required to departmental spending plans. These changes range from requests for additional authorities to increased funding for spending items, which were either, unforeseen or insufficiently developed at the time Main Estimates were prepared. The first Regular Supplementary Estimates are tabled in the House in November and referred to standing committees. Final Supplementary Estimates are tabled in the House in March and referred to standing committees.
6. Parliamentary Review of Expenditures
In the fall, several documents dealing with the fiscal year ending the previous March 31 are tabled in the House and referred to various committees of the House.
These documents include:
- Public Accounts which are tabled with the Public Accounts Committee;
- Accounting for Results which provides an overview of results-based management, performance and accountability issues;
- Departmental Performance Reports which are tabled with the various
- Standing Committees; and
- the Auditor Generals Report which is also tabled with the Public Accounts Committee.
* The Reports on Plans and Priorities and the Department Performance Reports are the integral part of the government's framework for performance measuring and reporting to Parliament which is discussed in the next section of this Guide
Contact for further information:
- Deputy Comptroller General Treasury Board Secretariat
Tel.: (613) 957-7820
- Assistant Secretary
Service and Innovation Sector
Treasury Board Secretariat
Tel.: (613) 957-0125
Treasury Board policies, publications, reports and Estimates documents are available on the TBS website.
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