Public Health Agency of Canada Quarterly Financial Report - For the quarter ended June 30, 2019

Table of contents

• 1.0 Introduction
  • 1.1 Authority, Mandate and Program
  • 1.2 Basis of Presentation
• 2.0 Highlights of Fiscal Quarter Results
  • 2.1 Significant Changes to Authorities
    • Vote 1 – Operating Expenditures
    • Vote 5 – Capital Expenditures
    • Vote 10 - Grants and Contributions (G&C)
  • 2.2 Significant Changes to Expenditures
    • Vote 1 – Operating Expenditures
    • Vote 10 - Grants and Contributions (G&C)
• 3.0 Risks and Uncertainty
• 4.0 Significant Changes in Relation to Operations, Personnel and Programs
• 5.0 Approval by Senior Officials
• 6.0 Statement of Authorities (unaudited)
• 7.0 Agency Budgetary Expenditures by Standard Object (unaudited)

1.0 Introduction

This quarterly financial report has been prepared by management as required by section 65.1 of the Financial Administration Act, in the form and manner prescribed by the Directive on Accounting Standards, GC 4400 Departmental Quarterly Financial Report. This quarterly financial report should be read in conjunction with the Main Estimates and Supplementary Estimates.  Please note that this quarterly financial report has not been subject to an external audit or review.

1.1 Authority, Mandate and Program

The Public Health Agency of Canada was created within the federal Health Portfolio in September 2004.  The core mandate of the Agency is to deliver on the Government of Canada's commitment to increase its focus on public health in order to help protect and improve the health and safety of all Canadians and to contribute to strengthening public health capacities across Canada. 

The Agency has the responsibility to:

• contribute to the prevention of disease and injury, and the promotion of health;
• enhance the quality and quantity of surveillance data and expand the knowledge of disease and injury in Canada;
• provide federal leadership and accountability in managing national public health events;
• strengthen intergovernmental collaboration on public health and facilitate national approaches to public health policy and planning; and
• serve as a central point for sharing Canada's expertise with international partners and to translate international knowledge and approaches to inform and support Canada's public health priorities and programs.

The Agency aims to achieve a strategic outcome of protecting Canadians and empowering them to improve their health by providing strategic policy advice and support to the Minister of Health on a range of Core Responsibilities, including:

• Health Promotion and Chronic Disease Prevention;
• Infectious Disease Prevention and Control; and
• Health Security.

The Agency also delivers a number of grant and contribution programs related to these programs.

Further information on the mandate, roles, responsibilities and program of the Agency can be found in the 2019-20 Departmental Plans and the 2019-20 Main Estimates.

1.2 Basis of Presentation

This quarterly report has been prepared using an expenditure basis of accounting. The accompanying Statement of Authorities (Section 6.0) includes the Agency's spending authorities granted by Parliament, or received from Treasury Board Central Votes, and those used by the Agency consistent with the Main Estimates and Supplementary Estimates for the 2019-20 fiscal year. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet financial information needs with respect to 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.

The Agency 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. 

2.0 Highlights of Fiscal Quarter Results

This section highlights the significant items that contributed to the net decrease in resources available for the year, as well as a net increase in actual expenditures for the first quarter of 2019-20, ending June 30, 2019.

The following graph provides a comparison of the net budgetary authorities and expenditures as of June 30, 2018 and June 30, 2019 for the Department's combined Vote 1, Vote 5, Vote 10 and Statutory Votes. 

Text description

The graph above provides a comparison of the net budgetary authorities and expenditures as of June 30, 2019 and June 30, 2018 for the Agency's combined Vote 1, Vote 5, Vote 10 and Statutory Votes. June 30, 2019, PHAC had a total of $625.6 million in authorities available for spending compared to $663.4 million on June 30, 2018. PHAC's expenditures as at June 30, 2019 were $173.1 million compared to $133.6 million on June 30, 2018.

As at June 30, 2019, the Agency had a total of $625.6 million in authorities available for spending compared to $663.4 million on June 30, 2018.  The Agency's expenditures as at June 30, 2019 were $173.1 million compared to $133.6 million on June 30, 2018.  Both authorities and expenditures fluctuate as the year progresses to reflect additional funding received throughout the fiscal year.

2.1 Significant Changes to Authorities

When compared to the first quarter of the previous fiscal year, the authorities available for spending for the year have decreased by $37.8 million or 6 percent, from $663.4 million to $625.6 million.  This change in authorities is comprised of an increase in Vote 1 – Operating Expenditures ($2.8 million), an increase in Vote 5 – Capital ($1.9 million) and a decrease in Vote 10 - Grants and Contributions ($43.3 million) as well as an increase in Budgetary Statutory Authorities ($0.8 million).

Vote 1 – Operating Expenditures

The Agency's Vote 1 increased by $2.8 million or 1 percent, mainly due to:

• Funding for Addressing the Opioids Crisis;
• Funding and Contract Authority for Backup Pandemic Influenza Vaccine Supply;

Offset by:

• A vote transfer from Operating to Capital for investments in science informatics and scientific equipment; and
• A change in funding for the MCM- Smallpox and Anthrax Preparedness.

Vote 5 – Capital Expenditures

The Agency's Vote 5 increased by $1.9 million or 32 percent, mainly due to:

• A vote transfer from Operating to Capital for investments in science informatics and scientific equipment.

Vote 10 - Grants and Contributions (G&C)

The Agency's Vote 10 decreased by $43.3 million or 15 percent, mainly due to:

• A decrease due to the sunset of funding for Implementation of the Healthy Seniors Pilot Project in New Brunswick.

Offset by:

• An increase in funding for Taking Action to Prevent and Address Gender-based Violence, Harassment and Discrimination;
• An increase in funding for ParticipACTION - Funding to Increase Physical Activity Among Canadians;
• An increase in funding for Indigenous Early Learning and Child Care Transformation Initiative (IELCC);
• An increase in funding to Support for Canadians Affected by Autism Spectrum Disorder;
• An increase in funding for Supporting Canada's Official Languages; and
• An increase in Funding for Building a Pan-Canadian Suicide Prevention.

2.2 Significant Changes to Expenditures

The first quarter expenditures increased by $39.5 million, or 30 percent, in 2019-20, compared to 2018-19, from $133.6 million to $173.1 million. 

This overall increase in spending is mainly due to a:

• 18% increase in Vote 1 – Operating Expenditures of $10.0 million (from $54.3 million to $64.3 million); and
• 40% increase in Vote 10 - Grants and Contributions of $29.0 million (from $71.8 million to $100.8 million).

Vote 1 – Operating Expenditures

The Agency's Vote 1 first quarter 2019-20 expenditures increased by $10.0 million over the same quarter in 2018-19 mainly due mainly due to timing issues on installment payments to Health Canada through the Shared Services Partnership Agreement.

Vote 10 - Grants and Contributions (G&C)

The Agency's Vote 10 first quarter 2019-20 expenditures increased by $29.0 million over the same quarter in 2018-19 mainly due to the timing of contribution payments in the first quarter.

3.0 Risks and Uncertainty

The dominant financial risks faced by the Agency relate to the nature of its mandate and the need to respond to unforeseeable events such as an influenza pandemic. Significant surge capacity would need to be activated in these instances.

To manage this financial risk, the Agency continues to strengthen its preparation and responsiveness to public health emergencies and public health capacity. In an emergency situation, the Agency would first consider internal re-allocation of resources in order to address unforeseeable events. The federal government also has systems and processes in place for departments to access funds, should an emergency arise.

4.0 Significant Changes in Relation to Operations, Personnel and Programs

There have been no significant changes in relation to operations, personnel and programs during this quarter.

5.0 Approval by Senior Officials

Approved by:

Tina Namiesniowski, President
Public Health Agency of Canada
Ottawa, Canada
Date:

Carlo Beaudoin, Chief Financial Officer
Public Health Agency of Canada    
Ottawa, Canada
Date:

6.0 Statement of Authorities (unaudited)

Public Health Agency of Canada
For the quarter ended June 30, 2019

Statement of Authorities (unaudited)

(in thousands of dollars)	Fiscal year 2019-2020			Fiscal year 2018-2019
	Total available for use for the year ending March 31, 20206.0 Table Footnote *	Used during the quarter ended June 30, 2019	Year to date used at quarter-end	Total available for use for the year ended March 31, 20196.0 Table Footnote *	Used during the quarter ended June 30, 2018	Year to date used at quarter-end
Vote   1 - Operating expenditures	330,937	64,331	64,331	328,106	54,324	54,324
Vote   5 - Capital expenditures	7,753	553	553	5,863	122	122
Vote 10 - Grants and contributions	243,538	100,834	100,834	286,843	71,846	71,846
(S) Contributions to employee benefit plans	29,885	7,411	7,411	29,072	7,268	7,268
(S) Spending of proceeds from the disposal of surplus Crown assets	62	0	0	74	31	31
(S) Spending of revenues pursuant to section 4.2 of the Department of Health Act	13,413	0	0	13,413	0	0
Total authorities	625,588	173,129	173,129	663,371	133,591	133,591
6.0 Table Footnote * Includes only authorities available for use and granted by Parliament at quarter end. Return to 6.0 table footnote * referrer

7.0 Agency Budgetary Expenditures by Standard Object (unaudited)

Table 1: Departmental budgetary expenditures by Standard Object (unaudited)

(in thousands of dollars)	Fiscal year 2019-20			Fiscal year 2018-2019
	Planned expenditures for the year ending March 31, 2020	Expended during the quarter ended June 30, 2019	Year to date used at quarter-end	Planned expenditures for the year ending March 31, 2019	Expended during the quarter ended June 30, 2018	Year to date used at quarter-end
Expenditures:
Personnel	232,667	49,127	49,127	228,463	45,967	45,967
Transportation and communications	7,172	1,594	1,594	6,758	1,281	1,281
Information	15,855	11,011	11,011	15,015	270	270
Professional and special services	76,249	2,933	2,933	87,431	2,886	2,886
Rentals	2,094	902	902	2,520	1,061	1,061
Repair and maintenance	2,850	619	619	2,833	867	867
Utilities, materials and supplies	23,661	5,031	5,031	20,030	8,291	8,291
Acquisition of lands, buildings and works	0	54	54	0	16	16
Acquisition of machinery and equipment	11,262	750	750	11,733	625	625
Transfer payments	243,538	100,833	100,833	286,843	71,846	71,846
Other subsidies and payments	10,764	416	416	2,269	603	603
Total gross budgetary expenditures	626,112	173,270	173,270	663,895	133,713	133,713
Less revenues netted against expenditures:
Services Non-Regulatory	524	141	141	524	122	122
Total Revenues netted against expenditures	524	141	141	524	122	122
Total net budgetary expenditures	625,588	173,129	173,129	663,371	133,591	133,591