OTTAWA -- The federal government held on to more than $11 billion it was expected to spend in 2010-11, according to its financial statements.
This is money that Parliament had approved and earmarked to benefit Canadians through green infrastructure, defence, salaries and a slew of programs.
Ottawa has been leaving increasing amounts of money on the table -- $6.2 billion in 2008-09, $9.4 billion the following year, and more than $11.2 billion in 2010-11, audited statements show.
Almost half of this year’s lapse came from two departments: Infrastructure Canada, which stalled on getting nearly $3 billion out the door, and National Defence, which lapsed almost $2.5 billion.
In an interview, Finance Minister Jim Flaherty noted that National Defence has had trouble using its budget as expected.
“We have a very large program going on to rebuild our Canadian armed forces, and they’ve found -- repeatedly, actually -- that they can’t get as much done in a given year as they perhaps thought they were going to,” he said.
Going forward, National Defence intends to "improve its performance on inventory and capital asset management," the department's spokeswoman said.
Managing a $20 billion budget is a "complex and challenging process," a National Defence spokeswoman wrote in an email, noting that the defence budget has grown by almost $8 billion since 2006. "Due to the complexity of some of our projects and long lead times for some equipment, it is not always possible to spend allocated funds in a given fiscal year."
In a report leaked earlier this year, retired Lt.-Gen. Andrew Leslie was critical of under-spending at Defence, where the lapse has ballooned to $2.5 billion from $673 million in three years.
Leslie said managerial incoherence and aversion to taking risks, coupled with a “cumbersome and even confusing” interdepartmental process went “a long way in explaining a disturbing and increasing trend” of hundreds of millions of dollars being approved but not spent.
The government allows departments to carry some cash over from year to year, but that option is “limited because we don’t want to create that expectation that if you don’t use the money that’s allocated, you get to use it next year,” Flaherty said.
Infrastructure Canada, however, is one example of a federal agency that chronically spends less than it says, yet consistently gets more money to stuff in its purse – to prospectively spend on roads, highways and bridges, for example.
In 2008-09, Parliament approved $3.3 billion, and Infrastructure left $1.1 billion behind; the next year, the agency asked Parliament to approve $4.8 billion, and sat on $1.3 billion; last year, Parliament approved $7.3 billion, and $3 billion didn’t make it out the door.
In a quarterly report released last June, the deputy head and chief financial officer at Infrastructure said the department will be taking steps to "minimize the size of future contribution lapses and improve" spending forecasting over the long-term. The department has raised the issue with provinces and territories, asking that claims be submitted as quickly as possible.
Still, funding lapses will never be totally eliminated at the department due to the complex nature of infrastructure projects, the report read.
Origin
Source: Global News
This is money that Parliament had approved and earmarked to benefit Canadians through green infrastructure, defence, salaries and a slew of programs.
Ottawa has been leaving increasing amounts of money on the table -- $6.2 billion in 2008-09, $9.4 billion the following year, and more than $11.2 billion in 2010-11, audited statements show.
Almost half of this year’s lapse came from two departments: Infrastructure Canada, which stalled on getting nearly $3 billion out the door, and National Defence, which lapsed almost $2.5 billion.
In an interview, Finance Minister Jim Flaherty noted that National Defence has had trouble using its budget as expected.
“We have a very large program going on to rebuild our Canadian armed forces, and they’ve found -- repeatedly, actually -- that they can’t get as much done in a given year as they perhaps thought they were going to,” he said.
Going forward, National Defence intends to "improve its performance on inventory and capital asset management," the department's spokeswoman said.
Managing a $20 billion budget is a "complex and challenging process," a National Defence spokeswoman wrote in an email, noting that the defence budget has grown by almost $8 billion since 2006. "Due to the complexity of some of our projects and long lead times for some equipment, it is not always possible to spend allocated funds in a given fiscal year."
In a report leaked earlier this year, retired Lt.-Gen. Andrew Leslie was critical of under-spending at Defence, where the lapse has ballooned to $2.5 billion from $673 million in three years.
Leslie said managerial incoherence and aversion to taking risks, coupled with a “cumbersome and even confusing” interdepartmental process went “a long way in explaining a disturbing and increasing trend” of hundreds of millions of dollars being approved but not spent.
The Green Infrastructure fund provides a good illustration of funds getting backlogged despite Canadians being told they would get it. The fund was announced in the 2009 budget as an initiative that would support projects such as sustainable energy.
It was supposed to push $200 million out the door every year for five years. In two years though, it has spent $50 million.
By the end of this year, the program is expected to use $104 million, not the $600 million planned, according to the government’s books.
In an email, a spokeswoman for Infrastructure said it is “normal for there to be smaller expenditures in the early years” of larger-scale projects. She didn’t respond to a follow-up, however, asking why the forecasting doesn’t reflect that.
Another reason infrastructure spending can get backlogged is because Ottawa usually refunds costs after provinces have incurred them. Sometimes the provinces don’t claim their expenses before the end of the fiscal year, the spokeswoman said.
Some of the lapsed Infrastructure funding is stimulus funding that was supposed to be contained to 2009-10 and 2010-11, but is being carried over to this year.
At the beginning of a new year, Ottawa hands some unspent money back to the departments, giving them another shot at funding the programs they were expected to.
The rest of the money is dumped into the government’s general bank account.
It was supposed to push $200 million out the door every year for five years. In two years though, it has spent $50 million.
By the end of this year, the program is expected to use $104 million, not the $600 million planned, according to the government’s books.
In an email, a spokeswoman for Infrastructure said it is “normal for there to be smaller expenditures in the early years” of larger-scale projects. She didn’t respond to a follow-up, however, asking why the forecasting doesn’t reflect that.
Another reason infrastructure spending can get backlogged is because Ottawa usually refunds costs after provinces have incurred them. Sometimes the provinces don’t claim their expenses before the end of the fiscal year, the spokeswoman said.
Some of the lapsed Infrastructure funding is stimulus funding that was supposed to be contained to 2009-10 and 2010-11, but is being carried over to this year.
At the beginning of a new year, Ottawa hands some unspent money back to the departments, giving them another shot at funding the programs they were expected to.
The rest of the money is dumped into the government’s general bank account.
The government allows departments to carry some cash over from year to year, but that option is “limited because we don’t want to create that expectation that if you don’t use the money that’s allocated, you get to use it next year,” Flaherty said.
Infrastructure Canada, however, is one example of a federal agency that chronically spends less than it says, yet consistently gets more money to stuff in its purse – to prospectively spend on roads, highways and bridges, for example.
In 2008-09, Parliament approved $3.3 billion, and Infrastructure left $1.1 billion behind; the next year, the agency asked Parliament to approve $4.8 billion, and sat on $1.3 billion; last year, Parliament approved $7.3 billion, and $3 billion didn’t make it out the door.
In a quarterly report released last June, the deputy head and chief financial officer at Infrastructure said the department will be taking steps to "minimize the size of future contribution lapses and improve" spending forecasting over the long-term. The department has raised the issue with provinces and territories, asking that claims be submitted as quickly as possible.
Still, funding lapses will never be totally eliminated at the department due to the complex nature of infrastructure projects, the report read.
Origin
Source: Global News
No comments:
Post a Comment