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

1.0 Introduction

This quarterly financial report for the period ending June 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 for the 2024-25 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 June 30, 2024 and June 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 $1,006.7 million (38.0 percent) lower and expenditures to date are $44.8 million (49.6 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 June 30, 2023 and June 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 $1,640.1 million for fiscal year 2024-25. The year-to-date expenditures of $135.1 million reported at the end of the first quarter of the 2024-25 fiscal year are shown under the “second” column. The “third” column in the graph depicts the 2023-24 authorities which were at $2,646.8 million at the end of June 2023. The 2023-24 year-to-date expenditures of $90.3 million reported at the end of the first quarter of the 2023-24 fiscal year are shown under the “fourth” column.

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

Comparison of funding received through Main Estimates and Supplementary Estimates (A) as of June 30, 2023 and June 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 $1,640.1 million in funding through Main Estimates and Supplementary Estimates "A" for fiscal year 2024-25. The total includes $249.3 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 2023-24 funding received through Main Estimates which was $2,646.8 million. The total for 2023-24 includes $204.5 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 June 30, 2024, the authorities provided to the Department include Main Estimates and Supplementary Estimates (A). The 2023-24 authorities for the same period included the Main Estimates. The Statement of Authorities table presents a net decrease of $1,006.7 million (38.0 percent) compared to those of the same period of the previous year (from $2,646.8 million to $1,640.1 million).   

Operating Expenditures authorities have increased by $44.8M (21.9 percent) (from $204.5 million to $249.3 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 2023-24.

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 2024-25. In 2023-24, 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 due to a fluctuation in funding levels required for 2024-25. In 2023-24, 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 Firearms Compensation Program to complete the collection and destruction of business owned 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 (4.3 percent) in 2024-25 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

First Quarter Expenditures

Compared to the previous year, expenditures used during the quarter ended June 30, 2024 have increased by $44.8 million (49.6 percent) (from $90.3 million to $135.1 million) as reflected in the Departmental Budgetary Expenditures by Standard Object table.

• Operating expenditures have increased by $3.0 million (6.1 percent) primarily attributable to:
  • Personnel expenditures have increased by $5.3 million (11.9 percent), primarily due to additional salary funding received to cover compensation adjustments associated with collective agreements concluded, and terms and conditions of employment updated.
• Transfer payment expenditures have increased by $41.3 million (114.4 percent) primarily attributable to:
  • An increase of $33.0 million due to the timing of payments for the First Nations and Inuit Policing Program;
  • An increase of $5.0 million due to the timing of payments for the Humanitarian Workforce to Respond to COVID-19 and Other Large-Scale Emergencies; and
  • An increase of $3.0 million due to the timing of payments for the Memorial Grant Program for First Responders.

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 Spring 2024 Semi-Annual Accounting exercise, there are currently 76 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 76 events is $5.25 billion, the majority of which is expected to be paid out over the next five years.

DFAA liability has slightly increased by $0.32 billion from $4.93 billion in the third quarter of 2023-24 to $5.25 billion in the first quarter of 2024-25. 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 Flood & Landslides ($577 million);
• Alberta 2013 June Flood ($410 million);
• British Columbia 2020 Flood & Landslides ($408 million);
• Manitoba 2022 Spring Flood ($238 million); and
• British Columbia 2023 Interface Fires ($226 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 Spring 2024 and is reflected in the current Quarterly Financial Report. Furthermore, following the Spring Semi-Annual Accounting exercise, there were 12 natural disaster events for which PS received requests of financial assistance but are still pending approval. Consequently, estimated liabilities for these events are not reflected in this report.

Financial impacts of the unprecedented wildfires in several Canadian provinces in 2023 are significant and are presently being estimated. Consequently, they are not reflected in this report.

4.0 Significant Changes in Relation to Operations, Programs and Personnel

Budget 2024 proposed funding, starting in 2024-25, to Public Safety (PS) to support the creation of a Federal Policing Task Force to establish a new vision of federal policing that will ensure that the RCMP has the resources, organizational structure, funding, and legislative authorities needed to better meet the challenges of a complex and evolving 21st century threat environment. A Treasury Board Submission is currently underway to access this funding.

The Government of Canada decided to provide funding, starting in 2024-25 and ongoing, to PS to establish the Foreign Influence Transparency and Accountability Regime. This Regime would impose disclosure requirements for individuals and entities acting on behalf of a foreign principal and includes a civil sanctions regime administered by an independent Commissioner of Foreign Influence Transparency to ensure compliance. While the office of the Commissioner overseeing the Foreign Influence Transparency and Accountability Act (FITAA) will be housed within Public Safety Canada, the Commissioner has authority to administer and enforce the Act independently from the Minister.

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:

2024-08-28