Quarterly Financial Report for the quarter ended December 31, 2021
Statement outlining results, risks and significant changes in operations, personnel and programs
Table of contents
1. Introduction
This quarterly financial report should be read in conjunction with the Main Estimates for fiscal year 2021-22. It has been prepared by management as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by the Treasury Board. For the purposes of both the Main and Supplementary Estimates, the Department is referred to as the Department of Indigenous Services Canada.
The quarterly financial report has not been subject to an external audit or review.
1.1 Authority, Mandate and Departmental Results
Indigenous Services Canada (ISC) works collaboratively with partners to improve quality of life and access to high-quality services for Indigenous Peoples. Its vision is to support First Nations, Inuit and Métis to design, manage and deliver services to their communities.
The Minister of Indigenous Services is responsible for this organization.
Further details on ISC's authority, mandate and department results can be found in Part II of the Main Estimates and the Departmental Plan.
1.2 Basis of presentation
This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the Department's spending authorities granted by Parliament, and those used by the Department consistent with the Main Estimates for the 2021-22 fiscal year. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities.
The authority of Parliament is required before money can be spent by the government. Approvals are given in the form of annually approved limits through appropriation acts, or through legislation in the form of statutory spending authority for specific purposes.
The Department uses the full accrual method of accounting to prepare and present its annual departmental financial statements that are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.
2. Highlights of the fiscal quarter and the fiscal year-to-date (YTD) results
This section:
- Highlights the financial results for the quarter and fiscal year-to date ended December 31, 2021.
- Provides explanations of variances compared with the same period of the previous year that exceed materiality thresholds of:
- $5 million for Vote 1, Program Expenditures and Vote 5, Capital Expenditures
- $25 million for Vote 10, Grants and Contributions and Statutory votes.
As of the third quarter, the Department has total budgetary authorities of $21.1 billion provided in the Main Estimates and Supplementary Estimates (A) and (B) for fiscal year 2021-22, as well as budget adjustments approved by Treasury Board up to Q3 of 2021-22.
Budgetary authority | Authorities available for the year ending | Expenditures as at Q3 | Year-to-date Expenditures | ||||||
---|---|---|---|---|---|---|---|---|---|
March 31, 2022 | March 31, 2021 | Variance | 2021-22 (December 31, 2021) | 2020-21 (December 31, 2020) | Variance | Q3 2021-22 (April 1 to December 31, 2021) | Q3 2020-21 (April 1 to December 31, 2020) | Variance | |
Vote 1: Operating Expenditures | 3,842,954 | 2,272,652 | 1,570,302 | 606,178 | 489,965 | 116,213 | 1,639,253 | 1,291,795 | 347,458 |
Vote 5: Capital Expenditures | 38,734 | 8,466 | 30,268 | 871 | 1,373 | (502) | 2,471 | 2,143 | 328 |
Vote 10: Grants and Contributions | 17,010,736 | 12,212,014 | 4,798,722 | 3,533,393 | 2,595,640 | 937,753 | 9,998,625 | 8,411,317 | 1,587,308 |
Statutory Authorities | 166,755 | 1,848,748 | (1,681,993) | 37,649 | 456,495 | (418,846) | 90,384 | 1,726,282 | (1,635,898) |
Total | 21,059,179 | 16,341,880 | 4,717,298 | 4,178,091 | 3,543,473 | 634,618 | 11,730,733 | 11,431,537 | 299,196 |
2.1 Statement of voted and statutory authorities
As per the highlights of the fiscal quarter and the year-to-date results table, total budgetary authorities available for use increased by $4.7 billion from the previous year:
Vote 1 Operating expenditures
Operating authority have increased by $1.6 billion in the third quarter of 2021-22 compared to the same period of the previous year, mainly due to the following:
- $1,251 million First Nations Child and Family Services;
- $116 million Clinical and Client Care;
- $110 million Supplementary Health Benefits;
- $38 million Communicable Disease Control and Management;
- $24 million Internal Services;
- $9 million Mental Wellness;
- $7 million Other Community Infrastructure and Activities;
- $5 million Environmental Public Health.
Offset by a funding decrease for the following program:
- $10 million Child First Initiative - Jordan Principle.
Vote 5 Capital expenditures
Capital authority have increased by $30 million in the third quarter of 2021-22 compared to the same period of the previous year, mainly due to the following:
- $16 million Clinical and Client Care;
- $15 million Communicable Disease Control and Management.
Vote 10 Grants and Contributions
Grants and Contributions authority have increased by $4.8 billion in the third quarter of 2021-22 compared to the same period of the previous year, mainly due to the following:
- $865 million First Nations Child and Family Services;
- $536 million Communicable Disease Control and Management;
- $530 million Education;
- $513 million Emergency Management Assistance;
- $488 million Water and Wastewater;
- $437 million Economic Development Capacity and Readiness;
- $346 million Other Community Infrastructure and Activities;
- $340 million Urban Programming for Indigenous Peoples;
- $325 million Income Assistance;
- $120 million Mental Wellness;
- $119 million Education Facilities.
- $94 million Home and Community Care;
- $93 million Health Facilities;
- $74 million Indigenous Governance and Capacity;
- $61 million Assisted Living;
- $52 million Supplementary Health Benefits
- $30 million BC Tripartite Health Governance;
Offset by a funding decrease for the following programs:
- $227 million Indigenous Entrepreneurship And Business Development;
- $132 million Child First Initiative - Jordan Principle; Footnote 1
Statutory Authorities
Statutory Authority (Operating and Grants & Contributions) have decreased by $1,7 billion in the third quarter of 2021-22 compared to the same period of the previous year, mainly due to funding pursuant to the Public Health Events of National Concern Payment Act which was received in statutory funding until September 30, 2020. After this date, this funding has been received under the regular Grants and Contribution funding. The net decrease relates to the following:
- $610 million Indigenous Community;
- $281 million First Nations and Inuit communities;
- $263 million Income Assistance;
- $237 million Safe Restart in Indigenous communities;
- $90 million Expanded Youth Employment and Job Skills;
- $83 million Indigenous Mental Wellness;
- $75 million Urban & Regional Indigenous organization;
- $75 million Mitigation Measures for Indigenous Businesses;
- $30 million First Nations Infrastructure.
Offset by a funding increase of $61 million for Canada Community - Building Fund.
2.2 Expenditures analysis by standard object
Departmental Budgetary Expenditures were $4.2 billion for the quarter ended December 31, 2021.
Departmental Budgetary Expenditures were $635 million lower than the same quarter in 2020-21. As per the Departmental Budgetary Expenditures by Standard Object tables, the decrease for the quarter is mainly due to the changes listed below:
Standard Object | Changes to Standard Object expenditures | Variance between 2021-22 Q3 and 2020-21 Q3 Expenditures (October 1 to December 31, 2021) (1) | Variance between 2021-22 year-to-date and 2020-21 Expenditures (April 1 to December 31, 2021) |
---|---|---|---|
Expenditures | |||
1-Personnel | The increase is mainly due to collective agreement renewals. Additional expenses related to the Clinical and Client Care Transportation Program as well as Communities Infrastructure and Activities Program. | 11,522 | 57,581 |
2-Transportation and communications | The increase is mainly due to the lifting of medical travel restrictions for Non-Insured Health Benefits due to COVID-19 Lockdowns in fiscal year 2020-21 and the increase of the number of paid pre-travel self-isolations that are required before every assignment for Health and Human Resources Program. | 30,283 | 66,295 |
3-Information | 276 | 614 | |
4-Professional and special services | The increase is mainly due to costs incurred from mandatory self-isolation of all personnel and contracted services before accessing communities in respect to pandemic safety measures. The increase is also attributable to Non-Insured Health Benefits Program expenses for Dental and Vision benefits, and to Jordan's Principle individual requests that have been steadily increasing year over year. | 22,124 | 129,888 |
5-Rentals | 1,049 | 4,454 | |
6-Purchased repair and maintenance | 22 | (220) | |
7-Utilities, materials and supplies | The increase is mainly due to lifting of COVID-19 restrictions for drugs and medical supplies for Non-Insured Health Benefits program. | 19,843 | 24,693 |
8-Acquisition of land, buildings and works | 104 | (11) | |
9-Acquisition of machinery and equipment | 108 | (729) | |
10-Transfer payments | Transfer payment expenditures* | 525,018 | (6,065) |
11-Public debt charges | - | - | |
12-Other subsidies and payments | 24,524 | 23,434 | |
Total gross budgetary expenditures | 634,873 | 299,934 | |
Less Revenues netted against expenditures | |||
Services and Benefits to Individuals | (255) | (738) | |
Total Revenues netted against expenditures | (255) | (738) | |
Total net budgetary expenditures | 634,618 | 299,196 | |
*The net increase of $525 million in transfer payment expenditures is mainly due to the following: $736 million increase due to the following:
Offset by a net decrease of $257 million due to the sun setting of the Statutory funding for the following programs:
|
3. Risks and uncertainties
The Department has developed a Corporate Risk Profile which includes the top risks that the Department may encounter. However, risks are not static. As such, the Department continues to proactively and systematically manage and respond to risk through rigorous monitoring, review and challenge functions. ISC has embraced an enterprise approach to risk management as a way to identify risks across programs, sectors and regions which may impede the achievement of its objectives and to develop coordinated response measures to ensure the continuity of its operations. Information concerning risk is continuously being collected and shared widely across the Department to gain a holistic picture of the challenges and opportunities it faces and to facilitate the development of synergistic strategies that offer the best treatment of risk at the lowest cost.
The Department's internal and external risk environment has significantly changed since the pandemic. It has created the need for additional financial flexibility within the Department to ensure the ability to allocate funds to the most pressing issues, while continuing to deliver services and other programs that are essential to addressing underlying social, economic and health issues in communities. In order to do this, the Department is exploring new ways to ensure the systems used for financial management are robust and remain relevant by renewing the budget management framework and strengthening budget forecasting, planning and cash management activities.
With respect to Grants and Contributions, the Department continues to undertake risk assessments on new, existing, and reformed programs as well as a general assessment of each recipient to identify areas of risk. The conduct of recipient and project audits, under the terms of their funding agreements, provides a further opportunity to ensure that funding recipients have appropriate management, financial and administrative controls in place.
The Department has undertaken a risk management approach to planning for different initiatives, such as the eventual and gradual increase in occupancy of ISC's worksites, which takes into account operational requirements as well as health and safety of employees, communities and partners.
Implementing these changes has, however, exposed the Department to new risks and opportunities related to its workplace, workforce and work.
The Department will continue to monitor its risk exposure and take action as needed to mitigate the risk of not achieving anticipated results and to responsibly manage public resources. Achievement of ISC's mandate and delivery of programs remains reliant on timely access to required authorities and appropriate levels of funding.
4. Significant changes in relation to Operations, Personnel and Programs
Significant changes in relation to Operations, Personnel and Programs during the third quarter of fiscal year 2020-21 include:
- No appointment at ADM level or up during the third quarter of fiscal year 2021-22;
- Departure of Gail Mitchell, Assistant Deputy Minister, Strategic Policy and Partnership, effective December 17, 2021;
- Negotiation and Implementation of Final Settlements on Individual Compensation and Long-Term Reform relating to First Nations Child and Family Services.
5. Approval by senior officials
Approved, as required by the Treasury Board Policy on Financial Management:
Original signed by
Christiane Fox
Deputy Minister, ISC
Date:
City: Gatineau (Canada)
Original signed by
Philippe Thompson
Chief Finances, Results and Delivery Officer
Date:
City: Gatineau (Canada)
6. Appendix
Fiscal Year 2021-22 | Fiscal Year 2020-21 | |||||
---|---|---|---|---|---|---|
Total available for use for the year ending March 31, 2022 | Used during the quarter ended December 31, 2021 | Year to date used at quarter ended December 31, 2021 | Total available for use for the year ending March 31, 2021 | Used during the quarter ended December 31, 2020 | Year to date used at quarter ended December 31, 2020 | |
Vote 1: Operating expenditures | 3,842,954 | 606,178 | 1,639,253 | 2,272,652 | 489,965 | 1,291,795 |
Vote 5: Capital expenditures | 38,734 | 871 | 2,471 | 8,466 | 1,373 | 2,143 |
Vote 10: Grants and Contributions | 17,010,736 | 3,533,393 | 9,998,625 | 12,212,014 | 2,595,640 | 8,411,317 |
S- Statutory Authorities: Operating expenditures | ||||||
Contributions to employee benefit plan | 101,847 | 21,369 | 64,106 | 81,767 | 20,184 | 60,550 |
Court awards – Crown Liability and Proceedings Act | 244 | 585 | 231 | 231 | ||
Minister of Indigenous Services Canada – Salary and motor car allowance | 91 | 23 | 68 | 89 | 22 | 67 |
Liabilities in respect of loan guarantees made of Indian for Housing and Economic Development | 2000 | 2,000 | ||||
Payments related to Public Health Events of National Concern and income support | 0 | 7,455 | 45,448 | |||
Other | 170 | 801 | 26 | 1,789 | ||
S- Statutory Authorities: Transfer Payments | ||||||
Canada Community-Building Fund - Financing municipal infrastructure (1) | 60,718 | 15,770 | 24,393 | 8,507 | 12,537 | |
Contributions in connection with First Nations Infrastructure | 29,684 | |||||
Indian Annuities Treaty payments | 2,100 | 73 | 431 | 2,100 | 149 | 216 |
Payments related to Public Health Events of National Concern and income support | 1,733,108 | 419,921 | 1,605,444 | |||
Subtotal Statutory Authorities | 166,755 | 37,649 | 90,384 | 1,848,748 | 456,495 | 1,726,282 |
Total Authorities | 21,059,179 | 4,178,091 | 11,730,733 | 16,341,880 | 3,543,473 | 11,431,537 |
(1) Name change from "Gas Tax Fund - Financing municipal infrastructure" to "Canada Community-Building Fund - Financing municipal infrastructure" following the Budget Implementation Act, 2021, No.1. |
Expenditures | Fiscal Year 2021-22 | Fiscal Year 2020-21 | ||||
---|---|---|---|---|---|---|
Planned expenditures for the year ending March 31, 2022 | Expended during the quarter ending December 31, 2021 | Year to date used at quarter ended December 31, 2021 | Planned expenditures for the year ending March 31, 2021 | Expended during the quarter ending December 31, 2020 | Year to date used at quarter ended December 31, 2020 | |
1-Personnel | 760,900 | 169,305 | 507,387 | 661,770 | 157,783 | 449,806 |
2-Transportation and communications | 485,479 | 101,137 | 238,116 | 464,715 | 70,854 | 171,821 |
3-Information | 4,149 | 708 | 1,539 | 4,065 | 432 | 925 |
4-Professional and special services | 849,506 | 167,022 | 425,580 | 781,863 | 144,898 | 295,692 |
5-Rentals | 22,380 | 4,299 | 12,452 | 23,249 | 3,250 | 7,998 |
6-Purchased repair and maintenance | 7,441 | 629 | 1,475 | 5,817 | 607 | 1,695 |
7-Utilities, materials and supplies | 709,353 | 139,060 | 443,087 | 694,147 | 119,217 | 418,394 |
8-Acquisition of land, buildings and works | 0 | 175 | 253 | 2,896 | 71 | 264 |
9-Acquisition of machinery and equipment | 38,734 | 11,735 | 30,937 | 12,627 | 11,627 | 31,666 |
10-Transfer payments | 17,073,553 | 3,549,236 | 10,023,449 | 13,919,090 | 3,024,218 | 10,029,514 |
11-Public debt charges | 0 | |||||
12-Other subsidies and payments | 1,202,000 | 35,943 | 50,099 | 2,000 | 11,419 | 26,665 |
Total gross budgetary expenditures | 21,153,495 | 4,179,249 | 11,734,374 | 16,572,239 | 3,544,376 | 11,434,440 |
Less Revenues netted against expenditures | ||||||
Services and Benefits to Individuals | (94,316) | (1,158) | (3,641) | (230,359) | (903) | (2,903) |
Total Revenues netted against expenditures | (94,316) | (1,158) | (3,641) | (230,359) | (903) | (2,903) |
Total net budgetary Expenditures | 21,059,179 | 4,178,091 | 11,730,733 | 16,341,880 | 3,543,473 | 11,431,537 |