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GUEST OPINION: Review of the government’s estimates is a waste of time

Finance Minister Darlene Compton leaves the legislature in Charlottetown on June 17, 2020, after delivering her budget address.
Finance Minister Darlene Compton leaves the legislature in Charlottetown on June 17 after delivering her budget address. - SaltWire file

Martin Ruben
Guest opinion

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Have you been watching the recent activity in the legislative assembly? Well, if you haven’t, the legislative assembly has been reviewing the estimates document produced by the government to obtain authority to spend public money.

In simple terms, the estimates represents the government’s detailed spending plan for the fiscal year that started on April 1, 2020. It shows how much will be spent on each program and service down to how much is going to be spent on maintaining the offices of public officials and the gas it takes to drive government vehicles around the Island. The review of the estimates follows the budget address presented in the legislative assembly by the minister of finance which outlines the government’s spending plan in very broad terms. The process followed to introduce the budget and the estimates is the same process that has been used by successive governments in past years.

The estimates document is several hundred pages long and contains thousands of numbers that would provide excellent reading for anyone who is having trouble sleeping at night. But to be serious, the numbers are important because they represent the authority for government managers, from deputy ministers and their senior managers along with individuals with government credit cards to spend money on what the government believes is in the public interest. The individual amounts in the estimates are accumulated to what are called appropriations that are voted on by the members of the legislative assembly. The estimates represent the planning phase of the government’s expenditure management framework. At the end of the process, the government prepares the public accounts that describe how public funds were spent. This article does not address my concerns with the government’s accountability for its spending, only for how it sets out its plans.

I believe there are a couple of documents missing (along with all the consultation and work that goes along with their preparation) that preclude the proper review of the estimates by the members of the legislative assembly. The first document that is missing is a strategic plan. While the budget address provides a general description of current year’s spending plans of government, it provides very little in the way of what the government is trying to accomplish (its objectives) in the longer term (three to five years), what it is doing to achieve those objectives and the expected results. While the budget address may indicate, for example, that the government is spending more money this year on education to increase the opportunity for those completing school to attend post-secondary school, the speech itself can only discuss these matters in a very cursory manner and without the kind of supporting narrative to fully understand how it plans to impact intended results over the longer term and what this means for those impacted by the initiatives.

By their nature, budget addresses are the annual plans for the government of the day (the elected folks) to tell the public what they are going to do to fulfill their election promises and to deal with the issues that arise from time to time — like a pandemic. They are not designed to provide an in-depth understanding of what government is trying to accomplish with the expenditure of public funds and how its change in approach will impact results through government expenditures.

The second key document that is missing is an operational plan. The P.E.I. government does not have a way to demonstrate how the programs and services it delivers support the results it is trying to achieve. Most governments around the world, including at the federal, state/provincial and municipal levels, plan, manage and report on the use of public funds by demonstrating how the functions within government ensure that money is being spent with due regard to value for money. The term value for money refers to the concept of knowing that public monies are spent with due regard to economy (resources are acquired at the lowest possible cost), efficiency (activities are carried out and outputs produced using the least amount of resources) and effectiveness (the activities of government lead to optimal outcomes). So, when asking questions in the legislative assembly, the members only know how government is planning to spend its resources, but have no clue about what will be accomplished and what results the government expects to achieve through its spending plan.

Martin Ruben runs a consulting business in Victoria-by-the-Sea and has a background in public sector governance. This is the first of a two-part opinion piece. In Part 2, which will appear online and in print July 8, he will continue the discussion and say what readers can do with this information.

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