Title of Presentation in Verdana Bold Canada’s Federal Government: how it works Douglas Nevison, Assistant Secretary Liaison Secretariat for Macroeconomic Policy Privy Council Office June 11, 2015

22 1. Scope of Federal Government

3 Our system of government Source: Forsey, 1980

4 The federal government is responsible for: Defence, foreign relations; Sea coast, navigation, shipping; Regulation of trade and commerce; Aboriginal affairs; Employment Insurance; Currency, coinage, and interest rates. There is shared jurisdiction over immigration and agriculture. Legal foundation of federal jurisdiction Provincial governments have jurisdiction over: Education, health, municipalities; Property and civil rights, marriage and divorce; Non-renewable natural resources, forestry, and electrical energy.

5 Government 101: what we do Source: TBS

66 Forces of change: Increasingly networked and interconnected world; Constant drive to maximize results with the resources used; Technological advances; Non-stop media cycle; Citizens’ rising expectations for better and faster services tailored to their needs. Operating context

77 2. Government in Numbers

88 Key Financials (at end ): $272 BN revenues. $277 BN expenditures. Balanced budget projected for consecutive unqualified or “clean” audits. $1,001 BN total liabilities (unmatured debt, pensions, benefits). $389 BN total assets (financial assets, capital assets). $612 BN federal debt (accumulated deficit). Finances and people Federal Public Service employment (depts +agencies): 257,138 in 2014, or 0.73% of 35.4M population; vs. 250,822 in 1983, or 0.99% of 25.3M population. Sources: Public Accounts of Canada 2014; Annual Report to PM on Public Service 2015.

99 How your money is spent $277 billion in Source: Department of Finance.

10 Where the money comes from $272 billion in Source: Department of Finance.

11 Government is smaller today Significant reduction in the relative size of government: Federal spending has averaged 14% of GDP since Government revenues as a proportion of GDP are lowest in more than 50 years. Source: Department of Finance, Fiscal Reference Tables, October 2014.

12 Lowest net debt to GDP ratio in the G-7 Total Government Net Debt to GDP, 2015 Sources: IMF, Fiscal Monitor April 2015.

13 3. Priorities and Challenges

14 Priorities: major imperatives Current federal government priorities are: Economic: creating jobs and economic growth; balancing the budget; Social: prosperous families; strong and secure communities; International: fostering trade; defending Canada; Government Affairs: modernizing government. The Clerk’s 2015 report to the Prime Minister on the Public Service has three areas of focus: Reinvigorating recruitment efforts; Healthy, supportive, respectful work environment; Reinforce policy community to provide world-class advice to the Government.

15 Budget 2015: signature items Economic: $1.4 BN projected surplus in and balanced budget legislation; Tax support for manufacturing investment; Supporting major public transit projects; Reducing taxes for small businesses. Building on previous announcements: Tax relief and enhanced benefits for Canadian families; Taking action for veterans; Renewing federal infrastructure. Social/Communities: Extending Compassionate Care Benefits; Increasing the Tax-Free Savings Account annual contribution limit. International: Increasing National Defence funding; Countering terrorism.

16 Policy challenges Ageing demographics. Productivity gap. Labour force participation: e.g, Aboriginals, recent immigrants, less-skilled workers, young workers, people with disabilities. Protecting the environment. Counter-terrorism.

17 4. Addressing Policy Challenges

18 A continuous process IDENTIFICATON OF CHALLENGES COMMUNICATION OF PRIORITIES POLICY ANALYSIS & DEVELOPMENT CABINET SCRUTINY AND APPROVAL IMPLEMENTATION MONITORING AND EVALUATION Identification of policy challenges: Medium-Term Planning exercise; Platform commitments. Communication of policy priorities: Speech from the Throne; PM’s mandate letters to Ministers. Policy analysis and development in departments Including consultations.

19 A continuous process IDENTIFICATION OF CHALLENGES COMMUNICATION OF PRIORITIES POLICY ANALYSIS & DEVELOPMENT CABINET SCRUTINY AND APPROVAL IMPLEMENTATION MONITORING AND EVALUATION Minister presents case for Cabinet scrutiny and approval: Assessment at policy committee, followed by P&P ratification; Funding approval through budget process, Treasury Board submission. Departments implement new policy or program. Monitoring and evaluation of performance: Program and policy reviews; Departmental Performance Reports.

20 Federal election year Role of the Public Service : Remain professional and non-partisan; Serve the government of the day to the best of our ability; Serve as caretakers of the democratic system in the peaceful transition of mandates following an election; Continue to provide services to Canadians during the campaign period.

21 The big picture “Public servants deliver programs and services that are essential to the safety, security and well-being of Canadians and to the competitiveness of the economy. We have to keep pace with increasing volumes and complexity, as well as rising service demands, while working with constrained resources towards operational excellence.” - Janice Charette Clerk of the Privy Council and Secretary to the Cabinet “As our world continues to evolve, our focus continues to be, and must remain, excellence in delivering quality programs and services to Canadians and evidence-based advice to government””