Quarterly Financial Report for the quarter ended June 30, 2022

Table of contents

1. Introduction

This Quarterly Financial Report should be read in conjunction with the Main Estimates for fiscal year 2022-23 as well as the Supplementary Estimates (A) for fiscal year 2022- 23. It has been prepared by management as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by the Treasury Board Policy on Financial Management.

This report has not been subject to an external audit or review.

1.1 Authority, Mandate and Departmental Results

Crown-Indigenous Relations and Northern Affairs Canada (CIRNAC) continues to renew the nation-to-nation, Inuit-Crown, government-to-government relationship between Canada and First Nations, Inuit and Métis; modernize Government of Canada structures to enable Indigenous Peoples to build capacity and support their vision of self-determination; and lead the Government of Canada's work in the North.

The responsibility for CIRNAC is shared between the Minister of Crown-Indigenous Relations and the Minister of Northern Affairs.

Further details on CIRNAC's authority, mandate and departmental results can be found in Part II of the Main Estimates and the Departmental Plan.

1.2 Basis of Presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying statement of authorities (Table1) includes the Department's spending authorities granted by Parliament, and those used by the Department consistent with the Main Estimates and Supplementary Estimates for the 2022–23 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 money 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 Department uses the full accrual accounting method to prepare and present its annual departmental financial statements that are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.

1.3 General Descriptions

The following descriptions are referred to throughout the report:

  • Authority: Approvals from Parliament to spend up to a specific amount.
  • Operating (Vote 1 and Statutory):
    • Vote 1: Amount approved for the fiscal year for the Department to spend on operating expenditures.
    • Statutory: Amount approved through an existing Act of Parliament.
  • Capital (Vote 5): Amount approved for the fiscal year for the Department to spend on capital purchases or for the construction of assets.
  • Grants and Contributions (G&C's) (Vote 10 and Statutory):
    • Vote 10: Amount approved for the fiscal year for the Department as Grants and Contributions (G&C's) transfer payments to recipients.
    • Statutory: Amount approved through an existing Act of Parliament.
  • Debt Forgiveness (Vote 25): The forgiveness, as referred to in section 24.1 of the Financial Administration Act, of a debt due to Her Majesty in right of Canada.
  • Standard Object (SO): Classification or coding of transactions to permit the reporting of information about the nature of transactions in the Estimates and Public Accounts.

2. Highlights of fiscal quarter and fiscal year-to-date (YTD) results

2.1 Authorities available for use

This section highlights the financial results for the quarter and fiscal year-to date ended June 30, 2022, and provides an explanation of variances in authorities available for use compared to the same period in the prior year.

CIRNAC's total budgetary authorities available for use at the end of the first quarter in 2022-23 is $7,295.2 million which is comprised of the Department's 2022-23 Main Estimates of $5,807.6 million and the Supplementary Estimates (A) of $1,487.6 million.

2.1.1 Highlights of changes in authorities available for use (2022-23 compared to 2021-22)

CIRNAC's total budgetary authorities available for use of $7,295.2 million at the end of the first quarter in 2022-23 is $1,600.8 million (28%) higher than the same period in 2021-22, and can be attributed to the following:

  • An increase of $2,833.2 million in Grants and Contributions funding, which is mainly attributable to the following:
    • Land claim settlement with the Siksika Nation ($1,300 million);
    • Specific Claims Settlement Fund ($752.5 million);
    • Indigenous Infrastructure Project and Housing ($427.0 million);
    • Implementing Canada's contribution to the National Action Plan: the Federal Pathway – Canada's Response to Missing and Murdered Indigenous Women and Girls National Inquiry's Final Report "Reclaiming Power and Place" ($96.5 million).

Partially offset by:

  • A decrease of $1,234.2 million in the Operating budget, mainly attributable to a $1,375 million decrease in funding for the Federal Indian Day Schools Settlement Agreement (McLean).

2.2 Authorities used and actual expenditures

CIRNAC's year to date expenditures for the quarter ended June 30, 2022, was $2,550.8 million compared to $1,442.2 million last year for the same period. This represents an increase of $1,108.6 million (77%). This is illustrated in the graph below.

Comparison of Net First Quarter Authorities to Date Expended as of June 30, 2022, and June 30, 2021 (in thousands of dollars)
Text alternative for: Comparison of Net First Quarter Authorities to Date Expended as of June 30, 2022, and June 30, 2021 (in thousands of dollars)
Fiscal Year Operating1 Capital Grants and contributions2 Total
FY 2022-23 236,207 0 2,314,547 2,550,754
FY 2021-22 523,068 54 919,043 1,442,165
Variance -286,861 -54 1,395,504 1,108,589
1The Operating authorities used include both voted authorities (vote 1) and statutory authorities related to operating expenditures.
2The Grants and Contributions authorities used includes both voted authorities (vote 10) and statutory authorities related to transfer payments.

The variance in spending can be mainly attributed to the land claim settlement with the Siksika Nation (+$1,300 million) in 2022-23.

See Table 1: Statement of Authorities and Table 2: Departmental Budgetary Expenditures by Standard Object for additional details.

3. Risks and Uncertainties

The Department has in place risk management processes to identify, assess and address strategic and operational risks, including financial risks. Risk mitigation activities are in place or in development to protect the Department from exposure to these risks and the associated financial impacts. Internal controls are in place, and subject to ongoing monitoring, to effectively manage financial risks.

COVID-19 continued to have a disruptive effect on the Department in terms of its workforce, its work environment and its way of doing business. At the same time, the pandemic also allowed the Department to rethink and redesign departmental approaches based on the many lessons learned during the pandemic. Many of the risks that arose due to the pandemic were – and continue to be -- managed by CIRNAC's Workplace of the Future Strategy. The Department continues to monitor the impacts of COVID-19 on departmental spending.

In addition, the Department continues to monitor the risk that there are insufficient controls and coordination in place in the management of common funding agreements between CIRNAC and the Department of Indigenous Services Canada. To mitigate any risks pertaining to common funding agreements with the Department of Indigenous Services Canada, budget and expenditure trends are monitored closely on a regular basis including formal reviews that are presented to and discussed by senior management.

4. Significant changes in relation to Operations, Personnel and Programs

During this quarter, there were no significant changes in personnel, operations or programs.

5. Approval by Senior Officials

Approved, as required by the Treasury Board Policy on Financial Management:

____________________________
Darlene Bess, FCPA, FCA
Chief Finances, Results and Delivery Officer, Crown-Indigenous Relations and Northern Affairs

Date: _______________
City: Gatineau (Canada)

_________________________
Daniel Quan-Watson
Deputy Minister, Crown-Indigenous Relations and Northern Affairs

Date: _______________
City: Gatineau (Canada)

Table 1: Statement of Authorities (unaudited) for the quarter ended June 30, 2022 (in thousands of dollars)
  Fiscal year 2022-23 Fiscal year 2021-22
Total available for use for the year ending March 31, 2023 * Used during the quarter ended June 30, 2022 Year to date used at quarter-end Total available for use for the year ending March 31, 2022* Used during the quarter ended June 30, 2021 Year to date used at quarter-end
Vote 1 - Operating expenditures 1,266,118 229,935 229,935 2,500,389 515,709 515,709
Vote 5 - Capital expenditures 328 0 0 1,821 54 54
Vote 10 - Grants and contributions 5,994,858 2,309,346 2,309,346 3,161,609 913,979 913,979
Vote 25 - Debt Forgiveness 0 0 0 515 0 0
S - Budgetary statutory authorities - Operating Expenditures:
Contributions to employee benefit plans 27,742 6,226 6,226 23,960 5,761 5,761
Minister of Crown-Indigenous Relations – Salary and motor car allowance 93 23 23 91 22 22
Minister of Northern Affairs – Salary and motor car allowance 93 23 23 91 23 23
Payments to comprehensive claim beneficiaries in compensation for resource royalties 1,866 0 0 1,866 0 0
Grassy Narrows and Islington Bands Mercury Disability Board 15 0 0 15 0 0
Other 0 0 0 0 1,553 1,553
S - Budgetary statutory authorities - Transfer Payments:
Grants to Aboriginal organizations designated to receive claim settlement payments pursuant to Comprehensive Land Claim Settlement Acts 4,126 5,201 5,201 4,126 5,064 5,064
Total Budgetary Authorities 7,295,239 2,550,754 2,550,754 5,694,482 1,442,165 1,442,165
Non-Budgetary Authorities:
Loans to native claimants 25,903 0 0 25,903 334 334
Total Non-Budgetary Authorities 25,903 0 0 25,903 334 334
Total Authorities 7,321,142 2,550,754 2,550,754 5,720,385 1,442,499 1,442,499
*Including only Authorities available for use and granted by Parliament at quarter-end. Note: Due to rounding, figures may not add to totals shown.
Table 2: Departmental budgetary expenditures by Standard Object (unaudited) for the quarter ended June 30, 2022 (in thousands of dollars)
  Fiscal year 2022-23 Fiscal year 2021-22
Planned expenditures for the year ending March 31, 2022 Expended during the quarter ended September 30, 2021 Year to date used at quarter-end Planned expenditures for the year ending March 31, 2021 Expended during the quarter ended September 30, 2020 Year to date used at quarter-end
1. Personnel 204,471 56,815 56,815 183,230 54,157 54,157
2. Transportation and communications 4,128 309 309 3,880 124 124
3. Information 6,036 9 9 5,426 520 520
4. Professional and special services 412,263 10,849 10,849 326,898 12,354 12,354
5. Rentals 9,270 214 214 4,386 63 63
6. Purchased repair and maintenance 2,287 19 19 1,282 19 19
7. Utilities, materials and supplies 1,658 53 53 1,523 63 63
8. Acquisition of land, buildings and works 204 0 0 268 0 0
9. Acquisition of machinery and equipment 124 71 71 1,553 87 87
10. Transfer payments 5,998,984 2,314,547 2,314,547 3,165,735 919,043 919,043
11. Public debt charges 0 0 0 0 0 0
12. Other subsidies and payments 688,881 167,868 167,868 2,033,368 455,735 455,735
Total gross budgetary expenditures 7,328,306 2,550,754 2,550,754 5,727,548 1,442,165 1,442,165
Less: Revenues netted against expenditures
Internal Services (33,067) 0 0 (33,067) 0
Total Revenues netted against expenditures (33,067) 0 0 (33,067) 0 0
Total net budgetary expenditures 7,295,239 2,550,754 2,550,754 5,694,482 1,442,165 1,442,165
Note: Due to rounding, figures may not add to totals shown.

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