This presentation was made by Marcia Santiago, Canada, at the 37th Annual Meeting of OECD Senior Budget Officials held in Stockholm on 9-10 June 2016

1. Performance Informed Budgeting
and Spending Reviews in Canada
37th Annual Meeting of OECD Senior Budget Officials
June 9-10, 2016

2. 2
Overview
• Context
o Process and timing of decisions
o Impact on quality of reporting to Parliament
• Performance Informed Budgeting
o Lessons learned from past experience
o A vision for the future
• Spending Reviews that Deliver Results
o Recent spending reviews
o Linking reviews to delivering results

3. 3
Decision Making Process
Existing
Programs
Funding
Pressures
Cabinet
Budget
Treasury
Board
Parliament
• Government spending decisions encompass the existing stock of programs, as well as new funding initiatives.
• Decisions taken by Ministers in Cabinet and Treasury Board are reflected in documents that are scrutinized by
Parliament, supported by the Auditor General and the Parliamentary Budget Officer.
Ministers and
Departments
Committees
House of Commons
• Government Operations
and Estimates
• Public Accounts
Senate
• National Finance
Officers
• Auditor General
• Parliamentary
Budget Officer
BUDGET 2016

4. 4
Parliamentary Approval and Reporting Dates
January to March 26
Main Estimates for the year ahead
(tabling and interim supply)
Federal Budget
Supplementary Estimates (C)
(last Estimates of the current fiscal
year)
September to December 10
Public Accounts
Supplementary Estimates (B)
Economic and Fiscal Update
April 1 to June 23
Supplementary Estimates (A)
Main Estimates
(approval and full supply)
April 1
Beginning of the Fiscal Year
The government starts a new
spending cycle.

5. 5
Anticipated Tabling and Approval Dates
Feb Mar Apr May June July Aug Sept Oct Nov Dec
April 1
Beginning of Fiscal Year 2016-17
2016-17
Mains Estimates
interim
supply bill
2016-17
Supplementary
Estimates (A)
2016-17
Mains Estimates
full
supply bill
2015-16
Supplementary
Estimates (C)
2015-16
Supplementary
Estimates (C)
supply bill
2016-17
Supplementary
Estimates (A)
supply bill
Budget 2016
2016-17
Reports
on Plans
and Priorities
2016-17
Supplementary
Estimates (B)
2016-17
Supplementary
Estimates (B)
supply bill
2015-16
Departmental
Performance
Reports
Government Gouvernement
of Canada du Canada
Prepared by the
Receiver General for Canada
Public Accounts of Canada
2016Volume II
Details of
Expenses and
Revenues
Canada
Government Gouvernement
of Canada du Canada
Prepared by the
Receiver General for Canada
Public Accounts of Canada
2016Volume III
Additional
Information and
Analyses
Canada
Government Gouvernement
of Canada du Canada
Prepared by the
Receiver General for Canada
Public Accounts of Canada
2016Volume I
Summary Report
and Consolidated
FinancialStatements
Canada

6. 6
Impact on Reporting to Parliament
• Misalignment of key spending documents
o Spending plans set out in the Budget are not generally
reflected in Main Estimates.
• Hampers Parliament’s ability to review and approve
spending
o Confusion regarding the government’s spending priorities.
o Undermines transparency in financial reporting.
o Sense of urgency to catch up spending plans and lost
opportunity for greater focus on program performance.

7. 7
• The Canadian Government is committed to evidence-based decision making and
focusing on results
• The Prime Minister of Canada has signalled the importance of achieving results
by establishing a Cabinet Committee on Agenda, Results and Communications.
The Prime Minister also highlighted the need to develop new, simplified forms of
reporting to Parliamentarians and Canadians
• The President of the Treasury Board of Canada was given a mandate to ensure
departments use the best available information, measure the impact of their
programs and improve parliamentary reporting
Focusing on Results

8. 8
Past Experience in Canada
Performance Measurement
• PRAS (1996):
– Focused largely on departmental business lines
– Criticized for not focusing on results and establishing some link between what was being
spent and what departments were seeking to achieve
• MRRS (2005):
– Focused on results but without equal attention to ensuring high quality indicators
– Resulted in an isolated planning regime geared to satisfying reporting requirements,
separate from the reality of departmental management practices
Evaluation
• Coverage:
– Full coverage (1977) – criticized for limiting resources that could be assigned to priority
areas
– Risk-based coverage (2001) – criticized for missing some programs that should be
evaluated, resulting in a return to full coverage (2009).

9. 9
We Can Do Better
WHERE WE ARE
Solutions
WHERE WE NEED TO GO
We do a lot of reporting that is
not widely read
Weak performance information and
unclear contribution to government
priorities
Departments organize their programs in
ways that don’t always focus on the results
that matter to Canadians
Evaluations stretched thin to achieve
comprehensive coverage every five years,
limiting resources to cover riskier
programming
Telling Canadians a clear and compelling
story of the difference departments are
making in their lives
Working collaboratively to help
departments improve their results focus
Adopting simpler and more flexible
structures focused on more meaningful
outcomes and indicators
Providing ministers with a clear
understanding of what the department is
focused on and how it’s doing

10. SIMPLIFY MEASUREMENT FOCUS EVALUATION CLARIFY REPORTING
Focus departmental reporting on
what matters to Canadians, and
provide a clear and simple way of
communicating what departments
do, what they are trying to
achieve, and how they will assess
success.
Implementing clear responsibility
and accountability for performance
measurement, and encouraging
centres of expertise to drive high-
quality measurement and
indicators
Improving evaluations to allow for
more flexibility in evaluation
planning and to improve the impact
of evaluation on learning and
delivery and results
10
A Vision for the Future
TO IMPROVE THE GOVERNMENT’S RESULTS CULTURE

11.  More accountability for results
 Clearer purpose and messages from departments to Parliament
and Canadians about what they seek to achieve
 More flexibility for departments to manage programs so that
better results are achieved
 Performance measurement and evaluation can be used to inform
decisions, as well as program and policy learning and
improvement
 Improved reporting tools so departments can be more transparent
on the difference they are making for Canadians
11
Benefits

12. • Data will need to be carefully managed to allow for trend analysis
• Changes will need to accommodate the wide diversity of
departments in size, focus, and operations
• Timelines for any changes will need to be long enough to allow
departments to adjust
• Driving the change will require capacity for performance
measurement and evaluation
• Achieving the benefits will require engagement and close
collaboration between central agencies and departments
Considerations
12

13. 13
Reviewing Spending
Priority Reviews Departmental Submissions
Treasury Board periodically and cyclically
reviews the existing departmental spending
to determine performance, alignment with
government priorities, and value for money.
Reviews also identify savings for
reallocation to higher priorities and more
effective and efficient ways to deliver
programs within a department.
Based on Budget decisions, Treasury Board
assesses requests for new funding through
submissions prepared by departments.
Submissions for new spending confirm that
initiatives are aligned with government
priorities as well as designed, implemented
and delivered to realize their intended
results, while achieving value for money.
New fiscal space is limited.
It is precisely for this reason that spending
review – properly defined as the review of
baseline expenditure … is now one of the
top budgeting reform agenda items in
OECD countries.
- OECD, 2015

14. 14
Recent Spending Reviews
• Reviewed key expenditures and identified opportunities for privatisation and transfers
of programs to provinces.
• Resulted in a net reduction of over 10% in program spending.
• Led to a significant revision of the missions of departments and programs.
Program Review assessed all spending to find savings 1994-97
• Conducted on a four-year cycle, roughly ¼ of government organizations each year.
• Assessed whether each program was aligned with government priorities and core
federal roles, was effective and efficient, and provided value for money.
• Reviewed 98% of direct program spending and achieved $2.8 billion in ongoing savings.
• Discontinued following announcement of Strategic and Operating Review across
government.
Strategic Reviews assessed all programs to support reallocation 2007-11
• Was a one-time review of most federal organizations covering about $75 billion of
direct program spending.
• Focused on reducing operating costs – organizations were encouraged to examine full
range of options, including more fundamental ways to re-engineer their business
models.
• Achieved $5.2 billion in ongoing savings in support of a balanced Budget.
Strategic and Operating Review emphasized fiscal restraint 2011-12
Political leadership
is key
Successful
implementation
requires monitoring
Systematic approach to
reviews works
Minimize burden on
departments
Performance
information quality
needs improvement
Incremental changes
create incremental
savings; substantial,
sustainable savings
require transformation
Lessons learned

15. 15
Characteristics of Successful Reviews
Review and ensure program effectiveness
• Assess program implementation and make informed decisions based on
results
Align existing spending with priorities and mandate
• Scale back spending on ineffective, low priority programs
• Reinvest savings to meet priorities
Lead improvements in service delivery
• Drive innovation to deliver services more effectively
Focus time and effort in support of new policy on results
• Embed a results orientation in public service culture
• Create a window for engagement on results