Transcript
Transcript: The Impact of Government's Financial Cycle on Your Day-to-Day Work
Narrator: Controlling public spending is a key element of responsible government. The government's Expenditures Management System operates on a cycle at both the parliamentary and departmental level. This video is an overview of the government budget cycle and explains how decisions made by the government and the budget have an effect on your responsibilities.
The cycle begins at the start of a new session of Parliament with the Speech from the Throne, which identifies the government's priorities.
In the planning stage, during the fall preceding the new fiscal year, your organization must confirm its budget estimate for the years to come by validating the Annual Reference Level Update.
The next phase is budgeting, whereby the Minister of Finance presents the annual Federal Budget and announces new program initiatives with respect to spending and revenues.
The Main Estimates present, in detail, the resources required by each organization to fulfill its mandate and cover its priorities for the coming fiscal year. They must be tabled each year, by March 1st.
These spending proposals are then analyzed by parliamentary committees before being adopted. Given that committees don't have sufficient time between March 1st and the start of the new fiscal year to complete their analyses, Parliament is asked to approve the first Appropriation Act known as Interim Supply. This Act provides the initial funding required by organizations to kick off the year while waiting for committee reports, which must be tabled no later than May 31st.
By the end of June, Parliament approves the second Appropriation Act known as Full Supply, based on the Main Estimates as well as committee recommendations.
From the moment that Full Supply has been approved, starting budgets are officialized for each department. It's possible for Parliament to grant additional spending powers during the year, through the adoption of appropriation acts for Supplementary Estimates. Departmental budgets are then adjusted accordingly.
The cycle ends with accountability reporting at the end of the year.
Narrator: While the government cycle of Expenditures Management is unfolding at the government-wide level, planning takes place concurrently within your department.
Typically, it begins with a strategic planning session with senior department officials outlining priorities for the year to come.
Once priorities are established, senior officials and managers must prepare operational plans. Usually, this occurs in the fall for the following year. Managers must also specify their needs, both in terms of financial requirements and full-time equivalents.
The sum of these requirements is compared with the Main Estimates proposed to Parliament. If the requested funding exceeds available financial resources, negotiations begin to achieve an acceptable budget.
Budgets are then formalized into departmental financial systems, and business plans are reflected in the performance agreements of managers and employees.
