Public Safety Canada Quarterly Financial Report for the quarter ended September 30, 2024

1.0 Introduction

This quarterly financial report for the period ending September 30, 2024 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.

This 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 2024-25 Departmental Plan and the 2024-25 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 and Supplementary Estimates (A) for the 2024 to 2025 fiscal year. This 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 September 30, 2024 and September 30, 2023 for the Department’s combined:

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

The net budgetary authorities are $1,003.5 million (37.8 percent) lower and expenditures to date are $34.0 million (11.4 percent) higher compared to the same period of previous year. These variances are primarily attributable to a decrease in funding for the Disaster Financial Assistance Arrangements (DFAA) program based on forecasts from provinces and territories.

Comparison of Budgetary Authorities and Quarterly Expenditures as of September 30, 2023 and September 30, 2024 (in thousands of dollars)

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Starting from the left hand side, the “first” column in the graph indicates that the Department authorities are at $1,648.0 million for fiscal year 2024 to 2025. The year-to-date expenditures of $331.8 million reported at the end of the second quarter of the 2024 to 2025 fiscal year are shown under the “second” column. The expenditures of $196.7 million for the period ended September 30, 2024 (i.e. second quarter) are presented under the “third” column. The “fourth” column in the graph depicts the authorities for fiscal year 2023 to 2024 which were at $2,651.5 million at the end of September 2023. The year-to-date expenditures of $297.8 million reported at the end of the second quarter of the 2023 to 2024 fiscal year are shown under the “fifth” column. The Departments’ actual expenditures incurred in the second quarter of fiscal year 2023 to 2024 were $207.8 million and are shown under the “sixth” column of the graph.

The following graph provides a comparison between the total of Vote 1, Vote 5 and Statutory funding as of September 30, 2024 and September 30, 2023.

Comparison of funding received through Main Estimates and Supplementary Estimates (A) as of September 30, 2023 and September 30, 2024 (in thousands of dollars)

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Starting from the left hand side, the “first” column in the graph indicates that the Department received $1,648.0 million in funding through Main Estimates and Supplementary Estimates "A" for fiscal year 2024 to 2025. The total includes $257.2 million in Vote 1, $1,367.3 million in Vote 5 and $23.5 million in Statutory funding. The "second" column in the graph depicts the funding received in fiscal year 2023 to 2024 through Main Estimates which was $2,651.5 million. The total for 2023 to 2024 fiscal year includes $209.2 million in Vote 1, $2,421.8 million in Vote 5 and $ 20.5 million in Statutory funding.

2.1 Significant Changes to Authorities

For the period ending September 30, 2024, the authorities provided to the Department include Main Estimates, Supplementary Estimates (A) and TB Central Vote transfers. The 2023 to 2024 fiscal year authorities for the same period included the Main Estimates and TB Central Vote transfers. The Statement of Authorities table presents a net decrease of $1,003.5 million (37.8 percent) compared to those of the same period of the previous year (from $2,651.5 million to $1,648.0 million). 

Operating Expenditures authorities have increased by $48.0 million (23.0 percent) (from $209.2 million to $257.2 million), which is primarily attributable to:

• An increase of $23.2 million in funding for the Assault Style Firearms Compensation Program (ASFCP) which is primarily attributable to:
• An increase of $20.1 million in funding to complete the collection and destruction of business owned assault style firearms and to establish a compensation program;
• An increase of $10.7 million in new funding to deliver to businesses and set up implementation for individuals; and
• Offset by a decrease of $7.6 million due to the expiry of the funding to support the design and development of the Assault Style Firearms Compensation Program. 
• An increase of $12.4 million in new funding to enhance natural disaster resilience; and 
• An increase of $12.3 million in funding for compensation adjustments following signatures of new collective bargaining agreements in fiscal year 2023 to 2024.

These increases are primarily offset by the following decrease:

• A decrease of $9.0 million in capital funding required for the relocation and accommodations for the Government Operations Center (GOC) (Budget 2016).

Grants and Contributions (G&C) authorities have decreased by $1,054.5 million (43.5 percent) (from $2,421.8 million to $1,367.3 million), which is primarily attributable to:

• A decrease of $1,174.9 million related to the Disaster Financial Assistance Arrangements (DFAA) program. This is due to a decrease of $100.0 million in funding levels to support the 2021 natural disasters in British-Columbia, as well as a decrease of $1,074.9 million in funding levels required for fiscal year 2024 to 2025. In fiscal year 2023 to 2024, due to shifts in forecasted requests for payments, a significant portion of funding was not spent and is anticipated to be fully transferred for use in future fiscal years to support provincial and territorial disaster response and recovery efforts; and
• A decrease of $21.6 million related to the Memorial Grant Program for First Responders due to a fluctuation in funding levels required for fiscal year 2024 to 2025. In 2023 to 2024 fiscal year, the program received additional funding to eliminate the backlog of applications and to accommodate growth in the program, however a large portion of the funding was not spent and is anticipated to be fully transferred for use in future fiscal years.

These decreases are primarily offset by the following increases:

• An increase of $80.1 million in new funding for the renewal of the Initiative to Take Action Against Gun and Gang Violence;
• An increase of $35.0 million to extend the Supporting a Humanitarian Workforce to Respond to COVID-19 and Other Large-Scale Emergencies contribution program;
• An increase of $13.7 million in new funding for the Assault Style Firearms Compensation Program to advance the collection and destruction of business owned banned assault style firearms and to establish a compensation program; and
• An increase of $12.1 million in funding levels for the First Nations and Inuit Policing Program.

Budgetary Statutory authorities have increased by $3.0 million (14.3 percent) in fiscal year 2024 to 2025 primarily attributable to the Employee Benefits Plan associated with new salary funding received in the Main Estimates and Supplementary Estimates (A).

2.2 Significant Variances from Previous Year Expenditures

Year-to-Date Expenditures

For the period ending, September 30, 2024, the Departmental Budgetary Expenditures by Standard Object table presents an increase of $34.0 million (11.4 percent) in Public Safety’s year-to-date (YTD) expenditures compared to the previous year (from $297.8 million to $331.8 million). This increase is primarily attributable to:

• An increase of $35.5 million in support of payments for the Initiative to Take Action Against Gun and Gang Violence;
• An increase of $21.4 million in support of payments for the First Nations and Inuit Policing Program;
• An increase of $9.0 million in support of payments for the Humanitarian Workforce to respond to COVID-19 and Other Large-Scale Emergencies; and
• An increase of $7.2 million for personnel expenditures primarily due to additional salary funding received to cover compensation adjustments associated with concluded collective agreements, and updated terms and conditions of employment.

These increases are primarily offset by the following decrease:

• A decrease of $32.9 million due to a decrease in advanced payment requirements related to natural disasters for the Disaster Financial Assistance Arrangements (DFAA) program. The program is currently projecting a surplus as a result of forecasts from provinces and territories (PTs). The forecast is based on the Spring 2024 Semi-Annual Accounting exercise and includes Orders in Council (OiC) that are pending approval, which may vary due to accurate estimates not yet available from PTs. Additionally, a PT may unexpectedly change their payment request (either timing or amount).

Second Quarter Expenditures

Compared to the previous year, expenditures used during the quarter ended September 30, 2024 have decreased by $10.8 million (5.2 percent) (from $207.6 million to $196.7 million) as reflected in the Departmental Budgetary Expenditures by Standard Object table.

• Operating expenditures have increased by $1.6 million (2.6 percent) primarily attributable to:
  • Other operating expenditures have increased by $3.1 million, primarily attributable to an increase in spending for information technology consultants and professional management consultants;
  • Personnel expenditures have increased by $1.8 million, primarily attributable to an increase in staffing requirements to support advancement of the department’s agenda; and
  • Offset by a decrease of $3.4 million in repair and maintenance expenditures, primarily attributable to the timing of payments for the relocation and accommodations for the Government Operations Center (GOC) (Budget 2016).
• Transfer payment expenditures have decreased by $13.8 million (9.4 percent) primarily attributable to:
  • A decrease of $32.9 million due to the timing of payments for the Disaster Financial Assistance Arrangements (DFAA) program; and
  • A decrease of $11.6 million due to the timing of payments for the First Nations and Inuit Policing Program.
    
    
  Primarily offset by the following increase:
  
  
  • An increase of $35.5 million due to the timing of payments for the Initiative to Take Action Against Gun and Gang Violence.  

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.

Following the Fall 2024 Semi-Annual Accounting exercise, there were 87 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 87 events is estimated at $5.55 billion, the majority of which is expected to be paid out over the next five years.

DFAA liability has slightly increased by $0.31 billion from $5.25 billion in the first quarter of 2024 to 2025 fiscal year to $5.55 billion in the second quarter of 2024 to 2025 fiscal year. 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 ($1.5 billion);
• British Columbia 2021 Wildfires ($475 million);
• British Columbia 2020 Flood & Landslides ($411 million);
• Alberta 2013 June Flood ($410 million);
• British Columbia 2021 Flood & Landslides ($324 million); and
• Manitoba 2022 Spring Flood ($252 million).

Updates to the DFAA liability as a result of changes to the estimates of the existing natural disasters, are completed and approved twice a year with the last update having been conducted in Fall 2024 and is reflected in the current Quarterly Financial Report. Furthermore, following the Fall Semi-Annual Accounting exercise, there were 3 natural disaster events (Northwest Territories 2024 Interface Fires, Nova Scotia 2024 July Rainstorm and New Brunswick 2024 February Rainstorm) for which PS received requests of financial assistance but are still pending OiC approval. Consequently, estimated liabilities for these events are not reflected in this report.

4.0 Significant Changes in Relation to Operations, Programs and Personnel

On October 15, 2024, the Prime Minister appointed Tricia Geddes as Deputy Minister of Public Safety, effective October 31, 2024.

On November 22, 2024, the Prime Minister announced the following additional appointments:

• Jeffery Hutchinson becomes the Associate Deputy Minister of Public Safety (Emergency Management), effective December 9, 2024.
• Daniel Mills becomes the Associate Deputy Minister of Public Safety, effective December 2, 2024.

5.0 Approval by Senior Officials

Approved as required by the TBS Policy on Financial Management:

6.0 Statement of Authorities (unaudited)

7.0 Departmental budgetary expenditures by Standard Object (unaudited)

Date modified:

2024-12-02