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Commentary Parliament needs its own vision for reforming fiscal scrutiny

Kevin Page is president and chief executive officer of the Institute of Fiscal Studies and Democracy at the University of Ottawa, senior fellow at Massey College and former parliamentary budget officer of Canada.

Political analysts were shocked this fall when Republican presidential nominee Donald Trump said the U.S. election is rigged. They feared that he was undermining the legitimacy of his country's electoral system. It is seldom good to call into question an institution that underpins our democracy, if it is working.

Canada has its own issues with seemingly rigged systems that favour government over Parliament. Parliament's fundamental role is to hold the government to account, namely by scrutinizing and authorizing the raising and spending of public money.

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While this may surprise some, the power of the purse actually rests with Parliament, not government. No money gets spent (or cut) unless Parliament approves it. Parliamentarians are struggling to do this job – we asked them, in a 2015 survey by the Institute of Fiscal Studies and Democracy.

Fully 91 per cent of parliamentarians said they found it at least moderately challenging to perform their fiscal scrutiny function, with 51 per cent indicating that it is extremely difficult or virtually impossible for them to perform their role effectively.

They said the estimates and the public accounts garner only 12 per cent and 6 per cent respectively, of their scrutiny time over the course of a session. Opposition parties are even more challenged, with 86 per cent citing a lack of information as a problem (compared with 6 per cent of members of the governing party). The results suggest that the system is broken.

Can it be fixed? Yes. But there are two considerations: One, the challenge to structural change within the executive branch (i.e. the public service); and two, that a truly sustainable solution should emerge from Parliament itself.

In October, Treasury Board President Scott Brison released a discussion paper on the government's vision to reform the estimates system. He is picking up the baton dropped by so many predecessors and should be commended for it.

The recommendations for change in the discussion paper seem to have come from a public servant's perspective. Here is what we can comfortably do, they say, to support estimates reform in the spirit of the 2012 operations and estimates committee report and the 2015 Liberal election platform.

The report does not start from the perspective of the financial-control responsibilities of Parliament.

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There is a big difference between theory and practice in Parliament. MPs rarely get the information they need before they vote on spending. It is very difficult for them to follow proposals on spending from a budget document (a high-level fiscal plan) to the estimates (votes on departmental spending) to the public accounts (how money was spent). There are disconnects of timing, accounting and information.

With great respect to Mr. Brison – who is well placed to understand the failings, given his time in opposition – the specific proposals in the report do not go far to strengthen Parliament's financial control. The strategy in the discussion paper is to improve information to parliamentarians on the margin, not to fix systemic problems.

On budget and estimates alignment, the report suggests that MPs should consider a delay in the tabling of main estimates until well after the start of the fiscal year.

How does that improve financial control? Bureaucrats are effectively saying Parliament would review requested spending after the start of the fiscal year on April 1, with budgets tabled in late winter. If you start from the perspective of financial control, Parliament should see the fiscal plan, departmental plans and requested authorities (voted and statutory) before April 1.

It is too difficult, the bureaucrats say, to present plans (budget) and requested authorities (estimates) on a consistent accounting framework. For a $300-billion annual spend, would it be too much to ask what our budget looks like when broken down by departments and agencies? Would it not be easier to vote on something that is consistent (accrual)?

If additional liabilities accrue, would it not be consistent to return it to Parliament for approval? From the perspective of financial control, Parliament should see a high-level fiscal plan (budget) supported by consistent departmental plans.

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They also say they are not ready to go to a vote structure based on program activities. Why? A parliamentary committee asked for it in 2012. We changed the chart of accounts more than 10 years ago to track spending by programs (linked to outcomes). The executive approves programs. MPs understand programs. Public servants collect performance information on programs, not the current vote structure in Parliament (operations, capital, etc.).

Are bureaucrats concerned about losing the flexibility to move money around that would help minimize lapsed authorities? Shame. That is a financial-control issue that belongs with Parliament. (Recall the transfer of funds from border infrastructure to city beautification, such as the "gazebo" issue, around the G20-G8 meetings in Canada under the previous government.)

Again, I applaud Mr. Brison's efforts to release the discussion paper. He has provided a government vision and approach to reform. Given the fiscal expansion of the current government to pay for better public services and infrastructure, real accountability on the public purse is essential.

Now it is time for Parliament to provide its vision for and approach to estimates reform. It is Parliament that must hold the government to account. We need to see its proverbial red lines.

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