Public Safety Canada Quarterly Financial Report for the quarter ended December 31, 2022

1.0 Introduction

This quarterly financial report for the period ending December 31, 2022 has been prepared by management as required by section 65.1 of the Financial Administration Act, in the form and manner prescribed by Treasury Board.  The report should be read in conjunction with the Main Estimates, Supplementary Estimates (A) and Supplementary Estimates (B).

This quarterly financial report has not been subject to an external audit or review.  However, it has been reviewed by the Departmental Audit Committee prior to approval by the Deputy Minister.

Information on the mandate, roles, responsibilities and programs of Public Safety Canada can be found in the 2022-23 Departmental Plan and the 2022-23 Main Estimates.

1.1 Basis of Presentation

This quarterly report has been prepared using an expenditure basis of accounting. The accompanying Statement of Authorities table includes the Department’s spending authorities granted by Parliament, or received from Treasury Board Central Votes, and those used by the Department consistent with the Main Estimates, the Supplementary Estimates (A) and the Supplementary Estimates (B) for the 2022‑23 fiscal year. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet the information needs concerning the use of spending authorities.

The authority of Parliament is required before funds 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.

Public Safety Canada 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, as do the expenditures presented in this report.

2.0 Highlights of Fiscal Quarter and Fiscal Year-to-Date (YTD) Results

The following graph provides a comparison of the net budgetary authorities and expenditures as of December 31, 2022 and December 31, 2021 for the Department’s combined:

• Vote 1: Operating Expenditures;
• Vote 5 and Statutory: Grants and Contributions;
• Statutory Votes:
• Employee Benefit Plans; and
• Minister’s Salary and Car Allowance. 

2.1 Significant Changes to Authorities

For the period ending December 31, 2022, the authorities provided to the Department include Main Estimates, Supplementary Estimates (A), Supplementary Estimates (B) and TB Central Vote transfers. The 2021-22 authorities for the same period included the Main Estimates, Supplementary Estimates (A), Supplementary Estimates (B) and TB Central Vote transfers. The Statement of Authorities table presents a net increase of $2,039.0 million (159.4 percent) compared to those of the same period of the previous year (from $1,278.9 million to $3,317.9 million).    

Operating Expenditures authorities have increased by $47.6 million (23.0 percent) (from $206.9 million to $254.5 million), which is primarily attributable to:

• An increase of $21.0 million in additional funding for the First Nations and Inuit Policing Program;
• An increase of $10.5 million in new funding to support the design and development of a firearms compensation program for prohibited assault style firearms (formerly known as buyback);
• An increase of $6.1 million for the relocation and accommodations of the Government Operations Center;
• An increase of $5.0 million in new funding for Government advertising programs, primarily related to firearms and emergency management awareness campaigns; and
• An increase of $3.6 million in new funding to enhance Canada’s Firearm Control Framework.

Grants and Contributions (G&C) authorities have increased by $1,989.0 million (188.7 percent) (from $1,054.0 million to $3,043.0 million), which is primarily attributable to:

• An increase of $1,977.9 million for new funding related to the Disaster Financial Assistance Arrangements (DFAA) program based on forecasts from provinces and territories for expected disbursements under the DFAA for 2022-23, the most significant of these being support for the 2021 natural disasters in British Columbia;
• An increase of $43.8 million in new funding for the Building Safer Communities Fund;
• An increase of $31.8 million in funding levels for the First Nation and Inuit policing facilities program;
• An increase of $14.3 million in additional funding for the Initiative to Take Action Against Gun and Gang program;
• An increase of $8.0 million to support the matching of donations raised by the Canadian Red Cross in response to the 2021 British Columbia flood and wildfire events; and
• An increase of $6.1 million in new funding for the Biology Casework Analysis Contribution Program.

These increases are primarily offset by the following decreases:

• A decrease of $35.0 million for the funding to support the Canadian Red Cross’s urgent relief efforts related to COVID-19, floods and wildfires;
• A decrease of $35.0 million in funding for the Safe Restart Agreement for federal investments in testing, contact tracing and data management (COVID-19);
• A decrease of $20.0 million for the National Disaster Mitigation Program; and
• A decrease of $6.8 million for the Supporting a Humanitarian Workforce to Respond to COVID-19 and Other Large-Scale Emergencies contribution program.

Budgetary Statutory authorities have increased by $2.4 million (13.2 percent) in 2022-23, primarily attributable to the Employee Benefits Plan associated with new salary funding received in Main Estimates and Supplementary Estimates (B).

2.2 Significant Variances from Previous Year Expenditures

Year-to-Date Expenditures

For the period ending December 31, 2022, the Departmental Budgetary Expenditures by Standard Object table presents a net increase of $904.4 million (231.1 percent) in Public Safety’s year-to-date (YTD) expenditures compared to the previous year (from $391.3 million to $1,295.7 million). This increase is primarily attributable to:

• An increase of $875.2 million due to an increase in advanced payment requirements related to natural disasters for the Disaster Financial Assistance Arrangements (DFAA) program;
• An increase of $38.0 million in support of payments for the Humanitarian Workforce to Respond to COVID-19 and Other Large-Scale Emergencies;
• An increase of $14.3 million in personnel expenditures primarily attributable to an increase in salary funding received to support the department’s initiatives;
• An increase of $6.8 million in support of payments for the Building Safer Communities Fund; and
• An increase of $6.5 million in support of payments for the First Nations Policing Program.

These increases primarily offset by the following decrease:

• A decrease of $36.2 million for payments in support of the Canadian Red Cross’s urgent relief efforts related to COVID-19, floods and wildfires.

Third Quarter Expenditures

Compared to the previous year, expenditures used during the quarter ended December 31, 2022 have decreased by $7.6 million (5.8 percent) (from $130.5 million to $123.0 million) as reflected in the Departmental Budgetary Expenditures by Standard Object table.

• Operating expenditures have increased by $11.3 million (26.2 percent) primarily attributable to:
  • Personnel expenditures have increased by $4.9 million, primarily attributable to an increase in salary funding received to support the department’s initiatives;
  • Other operating expenditures have increased by $6.4 million, primarily in support of the relocation and accommodations for the Government Operations Center;
• Transfer payments expenditures have decreased by $18.5 million (21.2 percent) primarily attributable to:
  • A decrease of $9.7 million due to the timing of payments related to natural disasters for the Disaster Financial Assistance Arrangements (DFAA) program;
  • A decrease of $8.6 million due to the timing of payments for the Gun and Gang Violence Action Fund;
  • A decrease of $3.5 million due to the timing of payments for the Biology Casework Analysis Contribution Program;
  • A decrease of $2.9 million due to the timing of payments for the First Nations Policing Program; and
  • A decrease of $2.7 million due to the timing of payments for the Memorial Grant Program for First Responders.

Primarily offset by the following increase:

• An increase of $10.6 million in support of payments for the Humanitarian Workforce to Respond to COVID-19 and Other Large-Scale Emergencies.

3.0 Risks and Uncertainty

Disaster Financial Assistance Arrangements

The Disaster Financial Assistance Arrangements (DFAA) contribution program presents a greater level of uncertainty than other PS grants and contributions programs given that it represents a significant portion of the PS budget and that it is subject to unforeseen events. The DFAA contribution program was established in 1970 to provide a consistent and equitable mechanism for federal sharing of provincial and territorial costs for natural disaster response and recovery where such costs would place an undue burden on a provincial or territorial economy.

There are currently 66 active natural disasters for which Orders in Council (OiC) have been approved, authorizing the provision of federal financial assistance under the DFAA, and for which final payments have not yet been made. Public Safety’s total outstanding share of liability under the DFAA with regards to these 66 events is $4.70 billion, the majority of which is expected to be paid out over the next five years.

DFAA liability has decreased by $1.65 billion from $6.35 billion in the second quarter of 2022-23 to $4.70 billion in the third quarter of 2022-23. Variations in the DFAA liability are mainly attributable to:

• Changes for newly approved OiCs, which authorize funding related to recent natural disasters for which provinces and territories require federal sharing of costs;
• Changes in the estimates of the existing natural disasters; and,
• Changes for payments issued under the existing obligation.

The following are the most significant events within Public Safety Canada’s DFAA liability:

• British Columbia 2021 November Storm ($1.6 billion);
• British Columbia 2021 Flood & Landslides ($608 million);
• Alberta 2013 June Flood ($502 million);
• Manitoba 2011 Spring Flood ($318 million);
• Quebec 2019 Spring Flood ($217 million); and
• British Columbia 2021 Wildfires ($146 million).

Updates to the DFAA liability related to changes in estimates for existing natural disasters are completed and approved twice a year. The most recent update was conducted in Fall 2022 and is reflected in this Quarterly Financial Report.

4.0 Significant Changes in Relation to Operations, Programs and Personnel

On October 17th 2022, Shawn Tupper was appointed as Deputy Minister of Public Safety Canada.

On October 28th, 2022, Dominic Rochon was appointed Associate Deputy Minister at Transport Canada. In the interim, Sébastien Aubertin-Giguère is Acting Senior Assistant Deputy Minister of the National and Cyber Security Branch.

5.0 Approval by Senior Officials

Approved as required by the Policy on Financial Resource Management, Information and Reporting:

6.0 Statement of Authorities (unaudited)

7.0 Departmental budgetary expenditures by Standard Object (unaudited)

Date modified:

2023-03-01