Quarterly Financial Report for the quarter ended June 30, 2024

Statement outlining results, risks and significant changes in operations, personnel and programs

Table of contents

  1. Introduction
  2. Highlights of fiscal quarter and fiscal year-to-date results
  3. Risks and uncertainties
  4. Significant changes in relation to operations, personnel and programs
  5. Approval by senior officials
  6. Appendix A

1. Introduction

This quarterly financial report should be read in conjunction with the Main Estimates for fiscal year 2024–25. 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 Department of Indigenous Services Canada (DISC) was first established by Order–in-Council (P.C. 2017-79) on November 30, 2017. The Budget Implementation Act (BIA) of 2019 established Indigenous Services Canada (ISC) with the enactment of the Department of Indigenous Services Act (DISA).

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 2024–25 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:

As of the first quarter, the Department has total budgetary authorities of $23.2 billion for 2024–25. Indigenous Services Canada (ISC) is composed of the following sectors: Regional Operations (RO), the Education and Social Development Program and Partnerships (ESDPP), Lands and Economic Development (LED), First Nations Child and Family Services (FNCFS), First Nations and Inuit Health Branch (FNIHB) and Internal Services.

Highlights of the fiscal quarter and the year-to-date results (Unaudited)
(In thousands dollars)
Budgetary Authority Authorities available for the year ending Expenditures as at Q1 Year-to-date expenditures
March 31, 2025 March 31, 2024 Variance 2024–25 (June 30, 2024) 2023–24 (June 30, 2023) Variance Q1 2024–25 (April 1 to June 30, 2024) Q1 2023–24 (April 1 to June 30, 2023) Variance
Vote 1: Operating Expenditures 2,793,600 26,985,452 (24,191,852) 663,439 570,623 92,816 663,439 570,623 92,816
Vote 5: Capital Expenditures 6,386 6,263 123 326 602 (276) 326 602 (276)
Vote 10: Grants and Contributions 20,292,736 17,339,700 2,953,036 7,356,146 4,683,338 2,672,808 7,356,146 4,683,338 2,672,808
Statutory Authorities 148,874 151,853 (2,979) 30,466 32,965 (2,499) 30,466 32,965 (2,499)
Total 23,241,596 44,483,268 (21,241,672) 8,050,376 5,287,528 2,762,848 8,050,376 5,287,528 2,762,848

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 decreased by $21.2 billion from the previous year:

  • Vote 1 authorities decreased by $24.2 billion
  • Vote 5 authorities increased by $0.1 million
  • Vote 10 authorities increased by $2.9 billion
  • Statutory authorities decreased by $3 million

Vote 1 Operating expenditures

Operating authority has decreased by $24.2 billion in the first quarter of 2024–25 compared to the same period of the previous year, mainly due to the following:

  • $24 billion for Child and Family Services;
  • $392 million for Supplementary Health Benefits;
  • $134 million for Community and the Environment.

Offset by a funding increase for the following program:

  • $152 million for Jordan's Principle & Inuit Child First Initiative.

Vote 10 Grants and Contributions

Grants and Contributions authority has increased by $2.9 billion in the first quarter of 2024–25 compared to the same period of the previous year, mainly due to the following:

  • $1.1 billion for Child and Family Services;
  • $739 million for Community Infrastructure;
  • $694 million for Jordan's Principle and the Inuit Child Initiative;
  • $251 million for Health System Support;
  • $120 million for Medical Travel Costs in Nunavut and North-Western Territories.

Offset by a funding decrease for the following programs as part of the Supplementary Estimates (A):

  • $48 million for Indian Residential Schools Resolution.

2.2 Expenditures analysis by standard object

Departmental Budgetary Expenditures were $8 billion for the quarter ended June 30, 2024.

Departmental Budgetary Expenditures were $2.8 billion higher than the same quarter in 2023–24. As per the Departmental Budgetary Expenditures by Standard Object tables, the increase for the quarter is mainly due to the changes listed below:

The following table provides a detailed explanation of these changes by standard object (Unaudited)
(In thousands dollars)
Standard Object Changes to Standard Object expenditures Variance between 2024–25 Q1 and 2023–24 Q1 expenditures Variance between 2024–25 year-to-date and 2023–24 year-to-date expenditures
Expenditures:
1-Personnel There are increases in Primary Health, Jordan's Principle, Indigenous Governance and Capacity Child and Family Services and Community Economic Development expenditures in order to deliver department programs. 22,395 22,395
2-Transportation and communications 4,809 4,809
3-Information 17 17
4-Professional and special services The increase is mainly due to the high number of requests for Jordan's Principle and Inuit Child First Initiative this fiscal year over last fiscal year and also to the timing difference of payments for Financial Services. 35,972 35,972
5-Rentals (520) (520)
6-Purchased repair and maintenance 250 250
7-Utilities, materials and supplies The increase is mainly due to an expansion in drugs listed as part of product listing agreements; as well as pharmacy growth in distinct claimants accessing the pharmacy benefit; also in medical equipment expenditures through the Non-Insured health Benefits Program and the associated increase in claims volume. 20,691 20,691
8-Acquisition of land, buildings and works 0 0
9-Acquisition of machinery and equipment 1,924 1,924
10-Transfer payments Transfer payment expendituresTable note 1 2,671,668 2,671,668
11-Public debt charges 0 0
12-Other subsidies and payments 5,178 5,178
Total gross budgetary expenditures 2,762,384 2,762,384
Less Revenues netted against expenditures
Services and Benefits to Individuals 441 441
Total Revenues netted against expenditures 441 441
Total net budgetary expenditures 2,762,848 2,762,848
Table note 1

The net increase of $2.7 billion in transfer payment expenditures is mainly due to the following:

  • $1.7 billion increase primarily due to the targeted investment for the Northern Grid connection project, as well as agreements being completed and disbursed to recipient at a faster rate than the previous year;
  • $387 million increase for Child and Family Services program mainly due to the continued implementation of the Agreement in Principle (AIP) Immediate Measures, an increased number of requests for reimbursement received for Capital and Post-Majority Support Services, as well as the coming into force of seven coordination agreements for First Nations;
  • $198 million increase for the high number of requests for Jordan's Principle and Inuit Child First Initiative this fiscal year over last fiscal year;
  • $138 million increase for Emergency Management Assistance program due to anticipation of a potentially worse wildfire season over last year;
  • $130 million increase for Urban Programming for Indigenous Peoples (UPIP) program expenditures due to funding flowed for infrastructure at the beginning of the fiscal year to communities for the Indigenous Communities Infrastructure fund as well as the Urban, Rural and Northern Housing project;
  • $121 million increase for Elementary and Secondary Education program expenditures provided to communities in order to ensure on reserve continued provincial comparability;
  • $52 million increase for Post-Secondary Education program expenditures due to the timing difference of payments this year compared to the same period last year. The gap is temporary and will be adjusted in the other quarters.

Offset by decreases for:

  • $43 million due to the expansion of the Aboriginal Entrepreneurship Program, to support Indigenous Women Entrepreneurs and for the Métis Capital Corporations for the Start-up and Expansion of Métis Small and Medium-sized Enterprises;
  • $37 million for Mental Wellness due to the timing difference of payments this year compared to the same period last year.

Return to table note 1 referrer

3. Risks and uncertainties

For 2024–25, the Department's key risks and the proposed efforts to mitigate them are described in the 2024–25 Corporate Risk Profile (CRP). Among these risks, a rapidly increasing and evolving Indigenous population, an overburdened health care system, a lack of predictable and sustainable funding, and more, continue to have significant impact on the department's ability to achieve its results.

The evolving fiscal landscape along with the complexities of discretionary funding, has created difficulties in consistently supporting the essential services that are mandated or legally required, particularly those driven by demand. This situation has introduced key risks prompting various efforts to address and mitigate the uncertainties associated with securing predictable and sustainable funding for the delivery of several of ISC's core services.

The Department delivers its programs and services mainly through transfer payments to Indigenous recipients. Recipients continue to face a range of challenges including population growth, unforeseen cost increases, growing demand for services, labor shortages, and other external factors. These challenges may impact the recipients' abilities to deliver projects or spend as planned, particularly in smaller communities lacking resources to address the loss. Mitigation strategies to address these challenges, such as initiatives to harmonize transfer payment programs terms and conditions, are ongoing.

ISC is dedicated to responsible stewardship of public funds. This commitment is evident through initiatives such as the development of an Integrated Risk Management Framework, and an annual CRP and Risk Register, enhancing risk data collection, analysis, and monitoring, fostering regular risk discussions at governance committees, reviewing the Budget Management Framework, improving planning and cash management practices, and intensifying efforts in fraud prevention and detection.

The Department will continue to monitor risk and take action as needed to mitigate the risk of not achieving objectives 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

5. Approval by senior officials

Approved, as required by the Treasury Board Policy on Financial Management:

Original signed by

__________________________
Gina Wilson
Deputy Minister, ISC
City: Gatineau (Canada)

Original signed by

__________________________
Philippe Thompson
Chief Finances, Results and Delivery Officer
City: Gatineau (Canada)

6. Appendix A

Statement of Authorities (Unaudited)
(In thousands dollars)
Statement of Authorities (Unaudited) Fiscal Year 2024–25 Fiscal Year 2023–24
Total available for use for the year ending March 31, 2025 Used during the quarter ended June 30, 2024 Year to date used at quarter-end Total available for use for the year ending March 31, 2024 Used during the quarter ended June 30, 2023 Year to date used at quarter-end
Vote 1: Operating expenditures 2,793,600 663,439 663,439 26,985,452 570,623 570,623
Vote 5: Capital expenditures 6,386 326 326 6,263 602 602
Vote 10: Grants and Contributions 20,292,736 7,356,146 7,356,146 17,339,700 4,683,338 4,683,338
S- Statutory Authorities: Operating expenditures
Contributions to employee benefit plan 112,833 26,785 26,785 115,275 27,921 27,921
Court awards–Crown Liability and Proceedings Act 0 0 0 0 240 240
Minister of Indigenous Services Canada – Salary and motor car allowance 99 25 25 95 24 24
Liabilities in respect of loan guarantees made of Indian for Housing and Economic Development 2,000 0 0 2,000 0 0
Other 0 45 45 0 29 29
S- Statutory Authorities: Transfer Payments
Canada Community – Building Fund – Financial municipal infrastructure 31,842 0 0 32,383 12 12
Indian Annuities Treaty payments 2,100 3,611 3,611 2,100 4,739 4,739
Subtotal Statutory Authorities 148,874 30,466 30,466 151,853 32,965 32,965
Total Authorities 23,241,596 8,050,376 8,050,376 44,483,268 5,287,528 5,287,528
Departmental budgetary expenditures by standard object (Unaudited)
(In thousands dollars)
Expenditures Fiscal Year 2024–25 Fiscal Year 2023–24
Planned expenditures for the year ending March 31, 2025 Expended during the quarter ending June 30, 2024 Year to date used at quarter ended June 30, 2024 Planned expenditures for the year ending March 31, 2024 Expended during the quarter ending June 30, 2023 Year to date used at quarter ended June 30, 2023
1-Personnel 910,593 185,203 185,203 863,437 162,808 162,808
2-Transportation and communications 404,111 98,637 98,637 392,308 93,828 93,828
3-Information 6,492 1,243 1,243 10,620 1,226 1,226
4-Professional and special services 985,179 185,864 185,864 1,903,755 149,892 149,892
5-Rentals 15,914 2,708 2,708 18,917 3,228 3,228
6-Purchased repair and maintenance 6,179 593 593 5,930 343 343
7-Utilities, materials and supplies 625,832 193,745 193,745 608,564 173,054 173,054
8-Acquisition of land, buildings and works 0 0 0 0 0 0
9-Acquisition of machinery and equipment 6,386 13,383 13,383 6,263 11,459 11,459
10-Transfer payments 20,326,679 7,359,757 7,359,757 17,374,183 4,688,089 4,688,089
11-Public debt charges 0 0 0 0 0 0
12-Other subsidies and payments 2,000 9,917 9,917 23,347,644 4,716 4,716
Total gross budgetary expenditures 23,289,364 8,051,050 8,051,050 44,531,621 5,288,643 5,288,643
Less Revenues netted against expenditures
Services and Benefits to Individuals (47,768) (674) (674) (48,353) (1,115) (1,115)
Total Revenues netted against expenditures (47,768) (674) (674) (48,353) (1,115) (1,115)
Total net budgetary Expenditures 23,241,596 8,050,376 8,050,376 44,483,268 5,287,528 5,287,528

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