The Role of Central AgenciesPresentation to the Financial Management InstituteJune 11, 2015National Arts Centre, Panorama Room

Heather Sheehy, Director of Operations, Machinery of Government, Privy Council Office

Government of Canada Gouvernement du CanadaPrivy Council Office Bureau du Conseil privé

Presentation Roadmap

• The Westminster System of Government

• Role of Central Agencies

• Privy Council Office

• Department of Finance and Treasury Board Secretariat

• Parting thoughts

• Discussion

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The Westminster System: Key Elements• The Prime Minister is the first Minister and the architect of

government, including defining Ministers’ roles and the Cabinet decision-making system

• Ministers are collectively and individually responsible to Parliament

• Deputy Ministers are the Minister’s principal source of support in fulfilling his or her responsibilities and in respecting his or her accountability to Parliament

• Public servants provide non-partisan policy advice to Ministers and conduct departmental operations through the exercise of the Minister’s legal authorities

• Exempt staff provide the Minister with advice that is politically engaged, but play no role in departmental operations and do not exercise any of the Minister’s powers, duties and functions

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Central Agencies• In the exercise of their authority, the Prime Minister and

the Cabinet are supported by both line departments and central agencies

• Central agencies play a key role in the successful formulation and implementation of governmental policies and programs by overseeing interdepartmental mechanisms of information-sharing, consultation and coordination

• Typically, people refer to three central agencies: the Privy Council Office (PCO), the Department of Finance and the Treasury Board Secretariat (TBS)

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Why is coordination necessary?

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Government is complicated

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Pressures Impact

• Government is complicated• It’s crowded with ideas• There are a lot of decision makers to manage• The speed of decision making is accelerating

Roles at a glance

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Finance

Supports the Minister of Finance

• Develops government’s macro-economic policy and fiscal framework

• Analyzes the economic and fiscal impacts of policy initiatives‒ Allocation of funds from

fiscal framework for new initiatives

• Prepares annual Budget • Government-wide financial

reporting

TBS

Supports Treasury Board and its President

• Responsible for the estimates and expenditure management system‒ Reviews submissions from

Ministers for funding‒ Reviews existing programs‒ Provides financial and

performance information to Parliament

• Manages government-wide financial, administrative and HR policies

• Employer for core public service• Supports the consideration of

regulations

PCO

Supports PM, Ministers in PM’s portfolio, and Cabinet

• Coordinates government priorities and policy agenda

• Supports cabinet-decision-making system:‒ ensures that departmental

submissions meet information needs of Cabinet and are coordinated with other departments and overall policy agenda

• Responsible for overall intergovernmental relations

• Advises the PM on the machinery of government

• Supports Governor in Council Appointments

• Maintains unity in Cabinet and provides direction to Ministers

• Has unique powers:

appointment and mandate of Ministers

appointment of senior officials

management of Cabinet

leadership on the direction of policy / finance

Supported by the Prime Minister’s Office:

• Comprised of exempt staff

Political strategy and tactics

Political dimensions of policy initiatives, problems, etc.

PM’s agenda and travel

Communications / national political liaison

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Prime MinisterClerk of the Privy Council andSecretary to the Cabinet• As Deputy to the Prime Minister

provides advice and staff support

• As Secretary to the Cabinet supports all Ministers collectively and individually

• Head of the Public Service

• Comprised of public servants (est. 835 FTEs in 15/16)

• Coordinates, not duplicates, work of departments

• Small, flat organization to facilitate information sharing and fast decisions

• Moves people in and out

Supported by the Privy Council:

“The Prime Minister’s Office is partisan, politically oriented, yet operationally sensitive. The Privy Council Office is non-partisan, operationally-oriented, yet politically sensitive.” Gordon Robertson, Clerk of the Privy Council and Secretary to the Cabinet, 1971.

PCO: Prime Minister’s Department • Supports the Prime Minister as Head of Government

Priority setting (e.g., assists with the writing of the Speech from the Throne; developing the federal Budget)

Policy development (e.g., foreign affairs, defence, national security and intergovernmental affairs, as well as other priorities)

Coordination of ministerial mandates

Government organization

National security

Senior appointments

Supports other ministers within the PM’s portfolio (e.g., the Leader of the Government in the House and the Minister of Intergovernmental Affairs)

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PCO: Cabinet Secretariat

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Priorities and Planning

Government Administration

Treasury Board (statutory)

Operations

Foreign Affairs and

Security

Economic Prosperity

Social Affairs

Machinery of Government

• Manages the flow of business to ensure that the decision-making process functions according to the standards set by the Prime Minister• Keeps track of departmental

initiatives• Ensures proper consultation• Plays a challenge function to ensure

that MCs are consistent with the government’s overall policy direction

• Specifically, with respect to Cabinet and Cabinet committee meetings, PCO provides for: Agendas Briefings to Chairs Committee minutes Cabinet decisions

PCO: Machinery of Government• Protects the Prime Minister’s prerogative for the machinery of

government• Provides advice and support to the Prime Minister, Clerk, PCO

Secretariats and departments on:• How government decisions are made. For example:

• the design of collective Cabinet decision-making process

• What organizational support is needed for Ministers to discharge their mandates. For example, decisions about:• the design of organizations, including their structure, mandate, powers, duties and

functions, and place within ministerial portfolios; and• whether existing organizations can be used to implement a policy decision or

whether changes are required to that organization or a new organization is necessary

• Who is responsible for implementing decisions. For example: • determining which minister should do what; and• the types of mandates, powers, duties and functions they need to implement

government decisions

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PCO: Supporting the Clerk’s role as head of the Public Service

• Provides strategic policy advice and analysis to the Clerk on whole-of-government initiatives for improving government efficiency and effectiveness, and for maintaining a strong, dynamic and relevant Public Service.

• Provides advice and support to the Deputy Minister Board of Management and Public Service Renewal and supports the Prime Minister’s Advisory Committee on the Public Service.

• Examples:

Clerk’s Annual Report to the Prime Minister

The public service management agenda (e.g., Blueprint 2020)

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Department of Finance• One of the original departments of the Government of Canada. Established by

statute under the Financial Administration Act and has authorities under numerous other Acts

• Supports the Minister in the management of the Consolidated Revenue Fund

• Supports the Minister of Finance in development the government’s macro-economic policy, including tax policy and tax expenditures, as well as the overall fiscal framework, and for analyzing the economic and fiscal impact of proposals by any Minister.

• Develops the annual budget. The budget is the government’s fiscal plan. It outlines projected revenues, changes in taxation and new spending plans.

• Manages federal borrowing on financial markets

• Administers major transfers of federal funds to the provinces and territories

• Develops regulatory policy for the country’s financial sector

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Treasury Board • A committee of Cabinet established by Financial Administration Act

and composed of the President of the Treasury Board, the Minister of Finance and four other ministers appointed by the Prime Minister

• In contrast to the Department of Finance which is responsible for establishing general policy on government revenues and expenditures, the Treasury Board oversees the management of the government’s expenditures and has responsibilities for government administration, as outlined in the Financial Administration Act and other Acts

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Treasury Board Secretariat • Assists the Treasury Board in fulfilling its duties

• Is headed by the Secretary of the Treasury Board, who is the equivalent of a deputy minister

• Sets administrative policies and monitors management performance

• Oversees expenditure management and performance information (e.g., Reports on Plans and Priorities and Departmental Performance Reports)

• Acts as the principal employer of the public service• Superannuation – pension• Labour relations• Collective bargaining

• The Secretariat also includes the Office of the Comptroller General of Canada, which is responsible for providing government-wide direction and assistance on financial management and internal audit

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Some Parting Thoughts…• The central agencies play a key role in decision-making processes

and administration

• They work to ensure policy coordination, good administrative practices, and prudent fiscal management

• Their influence and authority is often due to their proximity to the Prime Minister and Cabinet or control over the purse strings rather than the statutory authority

• Must balance a centralization of control and authority with sufficient flexibility and autonomy to allow line departments to effectively manage issues

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