This page has been archived.
Information identified as archived is provided for reference, research or recordkeeping purposes. It is not subject to the Government of Canada Web Standards and has not been altered or updated since it was archived. Please contact us to request a format other than those available.
This quarterly report 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. This quarterly report should be read in conjunction with the Main Estimates and Supplementary Estimates A as well as Canada's Economic Action Plan 2012 (Budget 2012).
A summary description of the Canada Border Services Agency (CBSA) program activities can be found in Part II of the Main Estimates.
This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities include the CBSA's spending authorities granted by Parliament and those used by the department, consistent with the Main Estimates and Supplementary Estimates A for the 2013-2014 fiscal year.
The authority of Parliament is required before monies 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.
As part of the Parliamentary business of supply, the Main Estimates must be tabled in Parliament on or before March 1 preceding the new fiscal year. Budget 2012 was tabled in Parliament on March 29, after the tabling of the Main Estimates on February 28, 2012. As a result the measures announced in the Budget 2012 could not be reflected in the 2012-2013 Main Estimates.
In fiscal year 2012-2013, frozen allotments were established by Treasury Board authority in departmental votes to prohibit the spending of funds already identified as savings measures in Budget 2012. In 2013-2014, the changes to departmental authorities were reflected in the 2013-2014 Main Estimates tabled in Parliament.
Additional funding was sought by the CBSA through the 2012-2013 Supplementary Estimates B. The department received this additional authority net of the planned savings or other amounts transferred by Treasury Board authority to a frozen allotment.
The CBSA uses the full accrual method of accounting to prepare and present its annual departmental financial statements that are part of the departmental performance reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.
The quarterly financial report has not been subjected to an external audit or review.
The CBSA has a financial structure composed mainly of voted budgetary authorities that include Vote 10 – Operating Expenditures and Vote 15 – Capital Expenditures, while the statutory authorities consist of contributions to the employee benefit plan, Court Awards - Crown Liability Act, Refunds of amounts credited to revenues in previous years, Collection agency fees and Spending of proceeds from the disposal of surplus Crown assets.
In addition the Agency also has a small special revenue respending authority for Net Voting. Only the revenues associated with costs incurred within net-voted activities are applied towards these costs. The revenues which are not associated with costs incurred are recorded as non-tax revenue. In the Agency's case Net Voting is appropriate as some of our programs are partially funded through User Fees (e.g. Nexus)
The CBSA also operates on the basis of a two-year appropriation, whereby any surplus amount reported at the end of a fiscal year is carried forward and is available to be used the following year. However, any portion of the unspent funds not spent at the end of the two years is lost. This process differs from that of other government departments as they can only claim five percent of their operating vote and twenty percent of their capital vote through the carry forward process each year.
This section highlights the significant items that contributed to the net increase or decrease in resources available for the year and actual expenditures for the quarter ended June 30, 2013.
Graph 1:
For the period ending June 30, 2013, the authorities provided to the CBSA are comprised of the Main Estimates only, while authorities at the same time last year consisted of both the Main Estimates and Supplementary Estimates (A). The Agency is experiencing an overall decrease in funding from the same time last year.
As at June 30, 2013, the Statement of Authorities (Table 1) reflects total authorities available of $1,680.2 million, compared to $1,795.0 million at the same quarter last year. The result is a net decrease of $114.8 million or 6.8% in authorities.
The Agency has $1,680.2 million of total available funding, with $20.5 million currently frozen and only eligible for spending once the appropriate Treasury Board conditions are met. Therefore, the total funding available to spend is $1,659.7 million.
The Agency has also experienced an increase of $2.4 million in its Vote Netted Revenues (VNR) from $9.7 million in quarter one of 2012-2013 to $12.1 million at the same time this year. This is mainly the result of an increase in volumes related to User Fee items. Increases in revenues are caused by incremental program costs for VNR eligible items and are related to program growth. Therefore, there is no impact to the overall Agency funding since the increased revenues offset increased program expenditures in Vote 10 Operating Expenditures.
The quarter one Departmental Budgetary Expenditures by Standard Object (Table 2) indicates a decrease in expenditures of $4.7 million or 1.3%, $362.4 million in 2012-2013 compared to $357.7 million in 2013-2014.
The decrease of $4.7 million in acquisition of land, building and works was a result of fewer infrastructure projects this year.
The CBSA is facing a rapidly changing and complex environment that expects to see an increase in the number of people and goods coming across the border over the next 10 years. While the U.S. will continue to be Canada's most important partner, Canada is diversifying its trading partners and is actively negotiating investment and free trade agreements with other countries. The increase in countries participating in international trade and travel introduced new challenges in protecting Canadians and the supply chain from potential security threats. In considering these factors the CBSA has embarked on business transformation initiatives that will allow the organization to be even more efficient and effective in the way it does business add more agile in dealing with challenges and containing costs.
Budget 2010 Cost Containment Measures have required the CBSA to finance, on a permanent basis, the costs of wage increases resulting from current and future collective agreements negotiated between 2010–2011 and 2012–2013. The ongoing impact of the Budget 2010 Cost Containment Measure has resulted in the realignment of internal funding to offset this new increased Agency pressure.
In recognition of this tightening fiscal environment, the CBSA has taken a more rigorous approach to the management of revenues, expenditures, projects and forecasting and commitment monitoring. These steps began in mid-fiscal year 2009–2010 to address the rapidly changing economic climate. The Agency has introduced more comprehensive monthly analyses of trends and forecasts of full-time equivalents and salary and non-salary expenditures to ensure affordability and sustainability. These measures, along with other budgetary restrictions, have been put in place to mitigate the impact of the operating freeze.
In addition, the CBSA is also in the process of maturing the integrated horizontal program management tables to oversee its business. This is in addition to the organizational view currently in place. There has also been greater attention and focus given to adopting stronger controls and processes surrounding project reporting and monitoring.
The Agency is ensuring that integration exists between the investment plan and business plans, and that risk and complexities are considered when new business initiatives are proposed within the context of these plans.
In 2012 the Agency undertook an update to its 2011 Enterprise Risk Profile (ERP). The aim of the 2012 ERP Status Update was to provide information on changes to the Agency's risk environment, thereby allowing senior management an opportunity to determine if the Agency is still responding appropriately to the risks identified in 2011.
Based on the results of the 2012 ERP Status, four of the 14 ERP risks currently being mitigated had slightly increased (IT Systems, Human Resources, Management of Border Programs, and Organizational Responsiveness), while effective implementation of mitigation activities had reduced the Agency's exposure to two of its risks (Information Management and Targeting). The remaining ERP risks remained at approximately the same level of severity as when they were assessed in 2011.
The increases in risk exposure for the four ERP risks identified above were not significant in nature, and were largely due to external challenges beyond the CBSA's immediate control. These external factors include the implementation of the Deficit Reduction Action Plan (DRAP) and the implementation of the Beyond the Border Action Plan.
There have been changes in senior level personnel, most notably the appointment of new Vice Presidents for Corporate Affairs and Information Science and Technology Branches.
New requirements for the reporting of financial information have been placed on departments as a result of the approval in 2010-2011 of the Policy on Financial Resource Management, Information and Reporting, amendment of the Treasury Board Accounting Standard (TBAS) 1.3, the new Directive on the Management of Travel, Hospitality and Conferences and the Parliamentary Budget Officer requests.
These policies/directives now require departments to produce auditable financial statements, comprehensive Future-Oriented Financial Statements and Quarterly Financial Reports, a comparative annual report on travel, hospitality and conference expenditures and reports on Supplementary Estimates by Program Activity to the Parliamentary Budget Officer. These reports have resulted in more requirements being placed on existing departmental personnel to retrieve, consolidate and produce these documents.
This section provides an overview of the savings measures announced in Budget 2012 that are being implemented in order to refocus government and programs: make it easier for Canadians and business to deal with their government; and, modernize and reduce the back office.
The CBSA will achieve Budget 2012 savings of $143.4 million by fiscal year 2014-2015 through efficiency measures by restructuring, modernizing programs and transforming business practices in select areas. With these changes the CBSA will focus on supporting management excellence and accountability across government. In the first year of implementation, the CBSA generated $31.3 million in savings. Those savings increase to $72.8 million in 2013-2014 and will result in ongoing saving of $143.4 million by 2014-2015.
As a result of Budget 2012, the CBSA is implementing its plan to:
Supplementary data on Budget 2012 savings by program activity is included in Annex A below.
The CBSA achieved its target for 2012-2013 and is on track to fully achieve its savings for 2013 2014, 2014-2015 and ongoing. The CBSA is actively managing the implementation of all initiatives through regular and sustained monitoring, ensuring that the delivery is proceeding on time, on plan, and on budget.
The initiatives under Budget 2012 will further enable the CBSA to focus and align resources to its key priorities and core mandate; meeting current and future security and service requirements to serve Canadians and provide them with a modern, dynamic border.
Impacts of Budget 2012 have been included to date for quarter one and budgets and expenditures have been reduced accordingly.
Planned Savings | |||
---|---|---|---|
Program Activity | 2012-13 | 2013-14 | 2014-15 & ongoing |
(in thousands of dollars) | |||
Risk Assessment | 5,452 | 10,168 | 11,209 |
Admissibility Determination | 7,254 | 20,469 | 30,494 |
Criminal Investigations | 15 | 73 | 118 |
Immigration Enforcement | 103 | 1,152 | 3,432 |
Secure and Trusted Partnerships | 158 | 327 | 7,706 |
Revenue and Trade Management | 1,753 | 3,994 | 9,816 |
Recourse | 129 | 302 | 609 |
Internal Services | 16,415 | 36,295 | 80,024 |
Total for CBSA | 31,279 | 72,780 | 143,408 |
On December 7, 2011, Prime Minister Stephen Harper and U.S. President Barack Obama announced a Canada–U.S. Action Plan in support of last February's Declaration of a Shared Vision for Perimeter Security and Economic Competitiveness (Perimeter Vision). The CBSA will play an instrumental role in implementing the Action Plan; there are ten initiatives that the Agency will lead, another nine in which the Agency plays a key supporting role and nine in which the Agency has an interest.
Although the action plan has been announced, details of all of the individual initiatives have not yet been tabled in Parliament. As such, not all of the Perimeter Vision initiatives have been included in the current Investment Plan to respect Budget confidentiality. As initiatives are approved, they will be incorporated into the CBSA Investment Plan process.
Approved by:
Ottawa, Canada
Date: August 29, 2013
Fiscal Year 2013–2014 | Fiscal Year 2012–2013 | ||||||
---|---|---|---|---|---|---|---|
(in thousands of dollars) | Total available for use for the year ending March 31, 2014* | Used during the quarter ended June 30, 2013 | Year-to-date used at quarter end | Total available for use for the year ending March 31, 2013*,*** | Used during the quarter ended June 30, 2012 | Year-to-date used at quarter end | |
Vote 10 – Net Operating Expenditures | 1,396,653 | 308,361 | 308,361 | 1,495,283 | 309,011 | 309,011 | |
Vote 15 – Capital Expenditures | 104,335 | 4,346 | 4,346 | 118,177 | 7,806 | 7,806 | |
Statutory Authority - Contributions to employee benefit plans | 179,164 | 44,791 | 44,791 | 181,491 | 45,373 | 45,373 | |
Statutory Authority - Court Awards - Crown Liability Act | 0 | 0 | 0 | 0 | 50 | 50 | |
Statutory Authority - Refunds of amounts credited to revenues in previous years | 0 | 15 | 15 | 0 | 27 | 28 | |
Statutory Authority - Spending of proceeds from the disposal of surplus Crown assets | 0 | 145 | 145 | 0 | 84 | 84 | |
Total budgetary authorities | 1,680,153 | 357,658 | 357,658 | 1,794,950 | 362,351 | 362,351 | |
Non-budgetary authorities | 0 | 0 | 0 | 0 | 0 | 0 | |
Total Authorities | 1,680,153 | 357,658 | 357,658 | 1,794,950 | 362,351 | 362,351 |
* Includes only Authorities available for use and granted by Parliament at quarter end.
*** Total available for use does not reflect measures announced in Budget 2012.
Fiscal Year 2013–2014 | Fiscal Year 2012–2013 | ||||||
---|---|---|---|---|---|---|---|
(in thousands of dollars) | Planned expenditures for the year ending March 31, 2014 | Expended during the quarter ended June 30, 2013 | Year-to-date used at quarter end | Planned expenditures for the year ending March 31, 2013* | Expended during the quarter ended June 30, 2012 | Year-to-date used at quarter end | |
Expenditures | |||||||
Personnel | 1,208,843 | 301,010 | 301,010 | 1,221,887 | 301,175 | 301,175 | |
Transportation and communications | 61,147 | 7,770 | 7,770 | 66,144 | 9,580 | 9,580 | |
Information | 1,293 | 476 | 476 | 1,620 | 204 | 204 | |
Professional and special services | 267,230 | 39,456 | 39,456 | 324,977 | 35,900 | 35,900 | |
Rentals | 8,759 | 1,728 | 1,728 | 9,039 | 2,324 | 2,324 | |
Repair and maintenance | 24,275 | 4,449 | 4,449 | 24,595 | 3,802 | 3,802 | |
Utilities, materials and supplies | 20,163 | 2,211 | 2,211 | 20,224 | 3,645 | 3,645 | |
Acquisition of land, buildings and works | 31,727 | 337 | 337 | 62,413 | 5,927 | 5,927 | |
Acquisition of machinery and equipment | 60,713 | 2,474 | 2,474 | 46,215 | 1,422 | 1,422 | |
Transfer payments | 0 | 0 | 0 | 0 | 0 | 0 | |
Other subsidies and payments | 8,132 | -542 | -542 | 27,546 | 426 | 426 | |
Total gross budgetary expenditures | 1,692,283 | 359,396 | 359,396 | 1,804,660 | 364,405 | 364,405 | |
Less revenues netted against expenditures | |||||||
Sales of Services | 12,130 | 1,726 | 1,726 | 9,710 | 2,081 | 2,081 | |
Other Revenue | 0 | -15 | -15 | 0 | -27 | -27 | |
Total revenues netted against expenditures | 12,130 | 1,711 | 1,711 | 9,710 | 2,054 | 2,054 | |
Total net budgetary expenditures | 1,680,153 | 357,658 | 357,658 | 1,794,950 | 362,351 | 362,351 |
* Planned expenditures do not reflect measures announced in Budget 2012.