Implementation of the Policy on Transfer Payments Learning Strategy Stratégie d’apprentissage pour la mise en oeuvre de la Politique sur les paiements de transfert Pierre Laflamme – TBS/OCG Hélène Maurais – CSPS

Introduction Purpose: Highlight key changes within the new Policy on Transfer Payments and Directive Highlight the training and development challenges Presentation: 1.Context 2.Main changes – Policy and Directive 3.Implementation and transition 4.Learning and development

3 1. Context  Review of the 2000 Policy and Audit reports (OAG)  Treasury Board Policy Renewal - all policies to be renewed  Federal Accountability Action Plan  Blue Ribbon Panel on Gs&Cs management  5 year review of ongoing Gs&Cs program  Streamlining the web of rules - Commitment to reduce the number of policies and rules by at least 50%  Public Service Renewal and its challenges  New policy supports enhanced accountability, risk management and excellence in the management of the public service

1. Context  Blue Ribbon Panel Report on G&C Reform  Includes clear recommendations related to training of all relevant public servants involved in transfer payments, including program managers and officers, comptrollers, financial advisors, audit and evaluation personnel as well as senior managers responsible for the administration of transfer payments programs

2. Policy on Transfer Payments Main changes - from 2000 to 2008 Objective: “To ensure sound management of, control over and accountability for transfer payments” (Policy 2000) “The objective of the Policy is to ensure that transfer payment programs are managed with integrity, transparency and accountability in a manner that is sensitive to risks; are citizen-focused; and are designed and delivered to address government priorities in achieving results for Canadians” ( Policy 2008)

2. Policy - Expected Results  Treasury Board Secretariat and departments will adopt a more risk tolerant approach to managing transfer payments, focusing oversight efforts where they are most needed;  Administrative practices will be streamlined to allow recipients to better focus transfer payment funding on the achievement of results, as opposed to compliance with non-value added administrative requirements;  The role of applicants and recipients in furthering the objectives of government and achieving results for Canadians will be respected through increased external engagement during program design and establishment of reasonable and practical departmental service standard targets;  Transfer payment programs will become increasingly harmonized within and across departments, and administrative practices will become more standardized.

2. Main changes - new Policy 2000 Policy Suite2008 Policy Suite 1  One policy and one guide  Blended roles and responsibilities  One policy, one directive and one guide  Clear roles and responsibilities at all levels 2  Most authorities centralized at TB  Ministers authorized to make minor amendments to T&Cs only  Increased authorities for ministers: a) All ministers authorized to approve continuation of T&C “as is” following an evaluation or review of relevance and effectiveness b) Upon request from a minister, and with adequate departmental performance record, TB may authorize a minister to approve amendments to T&Cs  TB keep the right to call any Minister at any time  Departments to consult with TBS prior to their Minister exercising authority to amend T&Cs 3  Prescriptive detailed requirements  Flexible, principles-based  New risk based approach taking into account the nature of the activity funded, the scale of funding and track record of the recipient

2. Main changes - new Policy (ctd) 2000 Policy Suite2008 Policy Suite 4  Focus mainly on departmental accountabilities  No explicit reference to engagement of recipients and service standards  Requirement for risk approach(6.5.7)  Requirement to engage recipients (6.5.8)  Requirement for service standards (6.5.9) 5  No explicit requirements for horizontal coordination  Requirements to harmonize programs and standardize administration  Leadership responsibilities for TB Secretariat 6  “One size fits all” approach  Needed to manage exemptions through TB  Specific requirements for Aboriginal groups, Foreign recipients and Other orders of government 7  Inconsistent selection and use of instruments  Clarified definitions and selection criteria (Grants – unconditional; Contributions – no longer limited to one basis of payment - eligible expenditure reimbursement) 8  Official languages - Chapter Grants and Contributions limited in scope and application to voluntary sector and Financial Administration Act schedule I departments  Official languages must be systematically considered in program design and funding agreements  Applies to all Financial Administration Act departments and may apply to any recipient

2. Main Changes - Directive 2000 Policy 2008 Directive Core design elements:  No requirements for core design elements: Core design elements:  When designing or redesigning a program, departments are now required to assess and document upfront Duration of Terms and Conditions (Ts&Cs):  Durations of T&C to be approved by TB and limited to 5 years Duration of Terms and Conditions (Ts&Cs):  No specific duration required in T&C unless otherwise decided by legal/policy authorities RMAF and RBAF:  T&Cs to include RMAF/RBAF Performance Measurement in Ts&Cs:  RMAF/RBAF no longer a requirement of PTP  Requires a performance measurement strategy  Leveraging on MRSS and the Evaluation policy

BeforeAfter Funding agreements : Reporting, monitoring and auditing: Cash management:  Prescriptive funding agreement provisions  Risk based management is expected Funding agreements: Reporting, monitoring and auditing: Cash management:  Allows for use of single funding and/or multi-year funding agreements where deemed appropriate  Reporting, monitoring, cash management and auditing now to be “proportionate to the risk level taking into account the risks specific to the program, the value of funding in relation to the administration costs, and the risk profile of the recipient” Specific group of recipients:  Led to many exemptions Up-front multi-year funding:  Was called “conditional grant” Specific groups of recipients:  More principle /risk-based requirements tailored to specific groups of recipients Up-front multi-year funding:  Formalizes current practice 2. Main changes - directive

2. Risk Management - Program Design  Assessment of risk, leads to decisions on:  Program design  Types of recipients  Types of projects, activities to be funded  Type of instrument to use (grant, contribution)  Basis of funding  Administrative requirements

2. Risk Management - Funding Agreement  Defined risk assessment factors, specific to a program, leads to decisions on:  Selection of recipients  Choice of funding instrument  Extent of monitoring  Cash management  Extent of reporting  Recipient auditing

3. Implementation & transition  Transitional considerations  Guidance / guidelines for departments - key topics:  Clause by clause  Approach for Ministerial increased authorities  Summary of 3 year plan - linked to RPP  Performance measurement in Ts&Cs  Official Language requirements in Ts&Cs  Communication and supporting activities and tools

4. Learning Strategy  Led by the CSPS in collaboration with OCG, the Center of Expertise (COE) and departments:  OCG for training on new policy instruments  COE for cultural change  Departments on specifics of their G&C programs and internal practices  Target population  G&C Program managers and officers  Financial advisors  TBS analysts  Auditors and evaluators  Senior managers  employees to be trained in NCR and in the regions

Key Learning Objectives Provide participants with :  Appreciation of the new requirements for managing transfer payments  Understanding of the cultural change needed to begin to adapt departmental practices  New skills in :  Risk management  Establishing service standards  Engaging recipients

Learning Strategy Phased-in approach :  Phase  Introduction to 2008 Policy – New course F405  Revise existing courses in Finance Curriculum  Service standards - New course T177  Phase 2 –  New learning products on special subject matters:  Risk management  Recipient engagement

G & C Learning Strategy – An Overview Support the development of technical, managerial and leadership competencies among all key partners involved in the design and management of G and C’s programs, with the target outcome of facilitating the implementation of the new PTP requirements. Other Learning Activities New Classroom Courses Revised Courses Spring Introduction – F415 Fall Risk Management (April 2009) 3. Recipient Engagement (April 2009) 4. Service Standards – T177 ( Fall 2008) F405 – Managing G & C - Jan 2009 F007 – Introduction to Financial Management F708 – Preparing TB Submissions F712 – Advanced Planning the Federal Government G243 – Managing Public Funds ADT Courses – G124, G110, G126, G127 Armchair Discussions Information Sessions Awareness Sessions Departmental Activities Recommendation # 28 Campus direct on-line courses (free)

Grants and Contributions Classroom Training  F415 - Introduction to the 2008 Policy on Transfer Payments  2 days course  30 offerings in the NCR  400 seats  Offerings are being scheduled in Regions  F405 - Managing Grants and Contributions  Under review to integrate new Policy requirements  Pilot in December  Revised version to be delivered starting in January

Other Key Related Training New:  T177 – Service Standards and Client Satisfaction Measurement Under Development – New FI Curriculum  Financial Management Control Framework (F111)  Financial Management Lifecycle (F112)

Key Advisory Role for FI’s  Choice of funding instrument (grant or contribution)  Basis of funding  Extent of monitoring  Cash management  Extent of reporting  Year-end recognition of funding against authority  Need for recipient audit ?