Parliamentary Budget Officer

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Parliamentary Budget Officer
Agency overview
Formed 2006
Headquarters Ottawa, Ontario, Canada
Employees 18
Annual budget $2.8 million
(FY 2012)
Agency executives
  • Jean-Denis Fréchette[1], Parliamentary Budget Officer
  • Mostafa Askari, Assistant PBO, Economic and Fiscal Analysis
Website www.pbo-dpb.gc.ca/

The Parliamentary Budget Officer (PBO) provides independent, authoritative and non-partisan financial and economic analysis. In doing so, the PBO supports parliamentarians in carrying out their constitutional roles of scrutinizing the raising and spending of public monies and generally overseeing the government’s activities.

The PBO strives to be responsive to the needs and concerns of parliamentarians who are always welcome to ask questions related to any aspect of its mandate.[2]

History[edit]

Creation of PBO (2006)[edit]

The Parliamentary Budget Officer was established in 2006 as one of the Independent Oversight Offices created as part of then newly elected Stephen Harper's Conservative Party of Canada's Federal Accountability Act.[3] The act was the new government's first piece of legislation.[3]

The powers of the PBO are enshrined in the Parliament of Canada Act (Sections 79.1-79.5).[4] The PBO's mission is said to be "The PBO will support Parliament in exercising its oversight role in the government’s stewardship of public funds by ensuring budget transparency and promoting informed public dialogue with an aim to implement sound economic and fiscal policies in Canada."[5]

Conservative government (2006 to 2015)[edit]

In March 2011, the PBO published a 65-page peer-reviewed report that estimated the cost of buying F-35 fighter jets. The PBO estimated the full cost to be $29.3-billion, including upgrade costs of $3.9-billion, much higher than the $9-billion the Department of National Defence had publicly estimated.[6] The Auditor General later reached a similar conclusion as the PBO.[7] Harper said that he refused “to get into a lengthy debate on numbers.”[8]

In February 2012, the PBO released an analysis of the projected cost, over the next 70 years, of benefits to the elderly. It concluded that those costs would rise for a number of years relative to GDP, then fall back very close to current levels (slightly less than 15 per cent of total federal program spending). This report contradicted the government's statement that Old Age Security was unsustainable.[9]

In June 2012, Foreign Affairs minister John Baird said in Question Period that PBO Kevin Page had overstepped his mandate, after Page sought a legal opinion on whether the PBO is entitled to all financial and economic data from federal departments as long as it's not protected for privacy or confidentiality reasons.[10]

In 2012, Page required 56 departments to detail savings and cost reduction measures they were undertaking, cuts which were required under that year's federal budget.[10] A number of government departments refused to disclose the number of job cuts and how much service in each department would be affected. Some cabinet ministers, such as Minister of Finance Jim Flaherty and Treasury Board President Tony Clement, who refused to disclose their numbers, said in October 2012 that the PBO was exceeding his office's mandate by requesting such information.[10][11] Other MPs defended the PBO, arguing that it is difficult to vote on a budget when details aren't known about how significant cuts will affect government services and programs.[12] The PBO argued that it is his job to inform parliamentarians and the public about what a $5.2-billion cut will do to government.[11] The PBO stated that it was prepared to take the issue to Federal Court to attempt to force the Government to comply.

In March 2013, after departing as PBO, Kevin Page said the Conservative government was sending a "very strong signal" that it's "moving to unwind the office."[13]

During the Canadian federal election in 2015, both the Liberals and New Democratic Party promised to strengthen the PBO.[14][15]

Liberal government (2015 to present)[edit]

The Liberal Party of Canada’s 2015 election platform committed to making the PBO “truly independent of the government” and “accountable only – and directly – to Parliament”. The platform also committed to expand the PBO’s mandate to include “the costing of party election platforms”. These changes were included in the Budget Implementation Act, 2017, No. 1 and came into force in September 2017.

In March 2017, the PBO said that the budget only showed $5.5 billion of the planned $8 billion that was allocated to new infrastructure spending under Justin Trudeau's Liberal Party of Canada's budget.[16] The Liberals disputed some of the findings, with a Treasury Board spokesperson saying that the problems arose from confusion surrounding the budget process.[16]

Organisation[edit]

The Officer is an officer of the Senate and the House of Commons, who reports to the Speakers of both chambers. The PBO is appointed to hold office during good behaviour for a once renewable term of not more than seven years. The PBO is organized into two divisions: Economic and Fiscal Analysis, and Expenditure and Revenue Analysis. Each division is led by an Assistant Parliamentary Budget Officer. Both divisions support the PBO’s role to inform parliamentarians and improve budget transparency.[5]

The Economic and Fiscal Analysis Division[edit]

The Economic and Fiscal Analysis Division provides economic and fiscal analysis, outlook and risk assessments. This analysis relies heavily on the use of econometric and statistical models and includes broader research on macroeconomic and fiscal policy.[5]

The Expenditure and Revenue Analysis Division[edit]

The Expenditure and Revenue Analysis Division analyzes program costs and estimates, assesses budgetary systems and provides cost estimates on Parliamentary proposals. This work often involves financial analysis and ‘due-diligence’, assessing business cases and developing cost methodologies.[5]

Operating model[edit]

The PBO’s basic operating model was developed through extensive stakeholder consultations.[5]

  • Independence: The PBO’s advice is independent, objective and non-partisan.[5]
  • Open and Transparent Publishing Model: The PBO’s analysis is openly reported to committees and parliamentarians and is freely accessible to all on its public website.[5]
  • Collaboration and Partnering: The PBO works with academics, think tanks, consulting firms and external experts to provide authoritative analysis. Peer review is also used when appropriate to ensure the quality and credibility of the analysis.[5]
  • Setting Priorities Based on Materiality and Contribution Potential: The PBO maintains an independent research plan, while simultaneously responding to incoming requests from parliamentarians and committees.
Given resource limitations, research priorities are set using two core principles:[5]
  • materiality: the issue can reasonably be expected to have a substantive impact on the government’s finances, estimates or the Canadian economy and;
  • contribution potential: the issue has the potential to increase budget transparency and/or promote informed parliamentary and public dialogue towards implementing sound budget policy and financial management

Access to information[edit]

The PBO has developed an information protocol. This process relies on the legislated provisions of the Parliament of Canada Act to provide the PBO with free and timely access to information from departments and agencies, while simultaneously providing them with clarity, predictability and transparency for all PBO information requests.[5]

The Parliament of Canada Act states that, "the Parliamentary Budget Officer is entitled, by request made to the deputy head of a department... to free and timely access to any financial or economic data in the possession of the department that are required for the performance of his or her mandate."[4]

Relation to Library of Parliament and the Office of the Auditor General[edit]

The PBO, the Parliamentary Information and Research Service (PIRS) of the Library of Parliament and the Office of the Auditor General of Canada provide distinct, but complementary services to support Parliament.[5]

The PIRS provides research and analytical support through responses to individual MP requests on a confidential basis, working with committees to draft reports and conducting occasional research projects. The PBO, on the other hand, provides independent economic, fiscal and financial analysis to Parliament and parliamentarians. The PBO also provides these types of reports to relevant committees upon request.[5]

The Office of the Auditor General of Canada takes a retrospective view of the public accounts and plays an assurance role. This is distinct from the PBO’s work, which is largely prospective in nature and in a decision support role for Parliament.[5]

Independence[edit]

Peggy Nash introduced a private member's bill that would make the Parliamentary Budget Office independent from the Library of Parliament, as the Office of the Auditor General of Canada is.[17]

Parliamentary Budget Officers[edit]

The Governor in Council appoints the Parliamentary Budget Officer to hold office for a renewable term of not more than five years. The Governor in Council selects the Parliamentary Budget Officer from a list of three names submitted in confidence by a committee formed and chaired by the Parliamentary Librarian.

Name Begin Date End Date
Kevin Page March 25, 2008 March 22, 2013
Sonia L'Heureux March 25, 2013 September 2, 2013
Jean-Denis Fréchette September 3, 2013[18] Present

Further reading[edit]

See also[edit]

References[edit]

External links[edit]