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Jean-Denis Fréchette, Parliamentary Budget Officer, is seen in Ottawa on Sept. 20, 2013.

Dave Chan/The Globe and Mail

The Parliamentary Budget Officer is warning that Liberal government changes to the watchdog office will undermine its independence and place it in an awkward position at election time.

In a detailed written analysis of the government's new legislation affecting the PBO, Parliamentary Budget Officer Jean-Denis Fréchette lays out a long list of strong objections to the planned changes.

As part of its omnibus budget bill, C-44, the Liberal government has included a wide range of changes to the PBO's powers and mandate that it says are aimed at making the office more independent.

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The PBO, which has been in place since 2008, is regularly used by opposition MPs as a way of getting an independent second opinion on cost estimates provided by cabinet ministers and government departments. These reports can sometimes prove politically embarrassing to the sitting government.

While the PBO supports the fact that the legislation would make it an independent officer of Parliament, rather than its current status as a division of the Parliamentary library, Mr. Fréchette has outlined numerous specific changes that he says would actually hurt the office's ability to inform MPs and the Canadian public about government spending.

In a report released Wednesday, Mr. Fréchette warns the budget bill "contains elements that will undermine the independence and non-partisanship of the PBO and that will undercut the PBO's ability to support Parliament."

Specifically, Mr. Frechette said the bill gives the Speakers of the House and the Senate too much control over the PBO by requiring them to approve a yearly work plan that the PBO must stick with.

"Should Canada enter into a recession, be struck by a natural disaster or deploy its armed forces abroad, the PBO will be unable to provide the Senate and the House of Commons with the timely analysis of the economic and financial consequences they need to hold the government to account, unless the Speakers grant their approval expeditiously, thus increasing their responsibilities," the report states.

Another major point of concern is the government's intention to give the PBO new powers to work with federal departments to cost and analyze the cost of political campaign promises at the request of political parties in the run-up to a federal election.

"Its implementation risks seriously undermining the PBO's perceived independence and non-partisanship," Mr. Fréchette warns. "In effect, this complex provision makes the PBO part of the political parties' policy development process and will turn PBO into a research bureau for all the political parties represented in the House of Commons in the pre-election period."

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The PBO is expressing concern that this work could be viewed as an election expense by the Chief Electoral Officer. The process also raises questions about the role of cabinet ministers and departments in approving this analysis and how and when the PBO's findings would be disclosed.

Other main points of concern expressed in Wednesday's report include ending the PBO's power to launch a study on specific government spending at the request of an MP or Senator, and restrictions on the PBO's power to access information from federal departments. In the event of a dispute, the PBO warns the office would have no avenue for appealing to the Federal Court for a decision.

"If the PBO does not have access to an effective [dispute resolution] remedy, a department or Crown corporation can refuse to comply with an information request without facing any consequences," the report states. "The PBO may not be able to provide comprehensive analysis of government documents or matters of particular significance related to the nation's finances or economy."

The legislation has not yet been studied by committee, where MPs will have an opportunity to hear from witnesses and consider amendments.

In a statement, Government House Leader Bardish Chagger defended the legislative changes and said the government's intent is to strengthen the PBO.

"Our government welcomes suggestions on how to improve the bill and we are open to amendments to ensure we accomplish the objective of an effective and independent PBO," she said in an emailed comment provided by her office.

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