Budget 2003

Making government more accountable to Canadians

February 18, 2003
Ottawa, Ontario

Canadians want to know how their tax dollars are being spent and they want to know that tax dollars are being spent wisely.

We are determined to improve the way we manage tax dollars by reviewing government programs to ensure they meet the needs of Canadians and shifting funding from lower to higher-priority areas.

Budget 2003 commits the government to improving the relevance, timeliness and clarity of the information it provides to Parliament. It also puts in place several measures to make government more accountable to Canadians

Reviewing and Reallocating Government Spending

We will launch an ongoing review of non-statutory government programs to determine if programs are still relevant, effective, and affordable.

We will examine government programs and question whether it is necessary for the federal government to operate them, or whether they should be transferred to other levels of government or to the private or voluntary sector.

We will examine department and agency management practices to ensure they are appropriate and of sufficient quality.

Budget 2003 commits federal departments and agencies to identify a total of $1 billion in savings from their budgets by eliminating or scaling back lower priority activities or by improving the way programs are currently developed. These savings will fund close to 15 per cent of the cost of the new initiatives in Budget 2003 over the next two years.

Increased transparency

We are introducing full accrual accounting, as recommended by the Auditor General of Canada and the Canadian Institute of Chartered Accountants. Full accrual accounting improves the Government’s ability to manage its liabilities and assets:

1. Tax revenues will be accounted for in the fiscal year to which they relate rather than when they are received;
2. Full accrual accounting recognizes the depreciation of the Government’s physical assets and will lead to more informed decision making about whether to buy, lease or sell buildings and equipment;
3. There will be a more complete recording of the Government’s liabilities, such as the potential cost of environmental clean-ups.

In addition to lowering the Employment Insurance employee premium rate to $1.98 in 2004 from $2.10 currently, we will also consult with Canadians on a new permanent process for setting EI rates for 2005. The new system will be transparent, based on independent expert advice, and will generate premium revenues that are in line with expected program costs.

We are improving the accountability and governance arrangements of arm’s-length foundations such as the Canadian Foundation for Innovation and Genome Canada.

Budget 2003 will boost investor confidence with an investment of up to $30 million per year to create a co-ordinated national program to strengthen enforcement against serious securities and corporate fraud offences, as well as to support the redesign of Canada’s regulatory environment.

As agreed by the Prime Minister and provincial premiers in the recent Health Accord, our health care system will be more accountable through the creation of a Health Council that will report regularly to Canadians.

Federal support to the provinces will also be more transparent and accountable with the creation of two new transfers: the Canada Health Transfer in support of health and the Canada Social Transfer for post-secondary education, social assistance and social services, including early childhood development.