Quarterly Financial Report for the quarter ended December 31, 2022

Statement outlining results, risks and significant changes in operations, personnel and program

A) Introduction

Statistics Canada's mandate

Statistics Canada ("the agency") is a member of the Innovation, Science and Industry portfolio.

Statistics Canada's role is to ensure that Canadians have access to a trusted source of statistics on Canada that meets their highest priority needs.

The agency's mandate derives primarily from the Statistics Act. The Act requires that the agency collects, compiles, analyzes and publishes statistical information on the economic, social, and general conditions of the country and its people. It also requires that Statistics Canada conduct the census of population and the census of agriculture every fifth year and protects the confidentiality of the information with which it is entrusted.

Statistics Canada also has a mandate to co-ordinate and lead the national statistical system. The agency is considered a leader, among statistical agencies around the world, in co–ordinating statistical activities to reduce duplication and reporting burden.

More information on Statistics Canada's mandate, roles, responsibilities and programs can be found in the 2022-2023 Main Estimates and in the Statistics Canada 2022-2023 Departmental Plan.

The Quarterly Financial Report:

• should be read in conjunction with the 2022-2023 Main Estimates;
• has been prepared by management, as required by Section 65.1 of the Financial Administration Act, and in the form and manner prescribed by Treasury Board of Canada Secretariat;
• has not been subject to an external audit or review.

Statistics Canada has the authority to collect and spend revenue from other federal government departments and agencies, as well as from external clients, for statistical services and products.

Basis of presentation

This quarterly report has been prepared by management using an expenditure basis of accounting. The accompanying Statement of Authorities includes the agency's spending authorities granted by Parliament and those used by the agency consistent with the Main Estimates for the 2022-2023 fiscal year. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities.

The authority of Parliament is required before moneys can be spent by the Government. Approvals are given in the form of annually approved limits through appropriation acts or through legislation in the form of statutory spending authority for specific purposes.

The agency uses the full accrual method of accounting to prepare and present its annual departmental financial statements that are part of the departmental results reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.

B) Highlights of fiscal quarter and fiscal year-to-date results

This section highlights the significant items that contributed to the net decrease in resources available for the year, as well as actual expenditures for the quarter ended December 31.

Chart 1 outlines the gross budgetary authorities, which represent the resources available for use for the year as of December 31.

Significant changes to authorities

Total authorities available for 2022-23 have decreased by $211.4 million, or 20.8%, from the previous year, from $1,015.4 million to $804 million (Chart 1). The net decrease is mostly the result of the following:

• A decrease of $319.6 million for the 2021 Census of Population and Census of Agriculture programs due to the cyclical nature of funding winding down in 2022–2023;
• An increase of $36.8 million for the Disaggregated Data Action Plan;
• An increase of $1.9 million for collective bargaining;
• An increase of $31 million for various initiatives including Census of Environment, Quality of Life Framework for Canada, Supporting Access to Sexual and Reproductive Health Care Information and Services and Workload Migration Project.

In addition to the appropriations allocated to the agency through the Main Estimates, Statistics Canada also has vote net authority within Vote 1, which entitles the agency to spend revenues collected from other federal government departments, agencies, and external clients to provide statistical services. The vote netting authority increased by $30 million, or 25%, compared to the third quarters of fiscal years 2021-2022 and 2022-2023, from $120 million to $150 million.

Significant changes to expenditures

Year-to-date net expenditures recorded to the end of the third quarter decreased by $176.4 million, or 24.2% from the previous year, from $728 million to $551.6 million (see Table A: Variation in Departmental Expenditures by Standard Object).

Statistics Canada spent approximately 84.4% of its authorities by the end of the third quarter, compared with 81.3% in the same quarter of 2021-2022.

Table A: Variation in Departmental Expenditures by Standard Object (unaudited) This table displays the variance of departmental expenditures by standard object between fiscal 2021-2022 and 2022-2023. The variance is calculated for year to date expenditures as at the end of the third quarter. The row headers provide information by standard object. The column headers provide information in thousands of dollars and percentage variance for the year to date variation.

Departmental Expenditures Variation by Standard Object:	Q3 year-to-date variation between fiscal year 2021-2022 and 2022-2023
	$'000	%
(01) Personnel	-241	0.0
(02) Transportation and communications	-47,380	-80.6
(03) Information	-16,790	-76.4
(04) Professional and special services	-119,555	-81.6
(05) Rentals	-4,496	-21.9
(06) Repair and maintenance	-612	-57.5
(07) Utilities, materials and supplies	-244	-32.1
(08) Acquisition of land, buildings and works	270	1,227.3
(09) Acquisition of machinery and equipment	-7	-0.1
(10) Transfer payments	-	N/A
(12) Other subsidies and payments	712	85.8
Total gross budgetary expenditures	-188,343	-23.9
Less revenues netted against expenditures:
Revenues	-11,927	-19.6
Total net budgetary expenditures	-176,416	-24.2
Note: Explanations are provided for variances of more than $1 million.

Transportation and communications: The decrease is mainly due to postage costs for the mailing of Census questionnaires and related materials and travel expenditures for enumerators for the 2021 Census collection which occurred last fiscal year.

Information: The decrease is mainly due to printing and advertising costs for the 2021 Census which occurred last fiscal.

Professional and special services: The decrease is mainly due to the remuneration of Statistics Act employees hired to conduct the 2021 Census.

Rentals: The overall decrease is mainly due to the building space rentals related to the census operations as they are winding down in 2022-2023.

Revenues: The decrease is mainly due to a timing difference in invoicing compared to last year.

C) Significant changes to operations, personnel and programs

In 2022–2023, Statistics Canada will continue processing and analysing Census data, and disseminating the remaining major 2021 Census data releases. Six data releases took place in 2022-23 for the Census of Population (April, July, August, September, October and November 2022). There are seven major 'themed' (2021 Census dissemination planning, Release plans) release dates for the dissemination of data from the 2021 Census of Population. The Census of Agriculture took place in May of 2021. This contrasts with last year, when Statistics Canada focused on data collection and processing activities of the 2021 Census program.

The agency is managing other changes in operations and program activities with financial implications including:

• Continued effort and collaboration to provide data and insights related to the impact of the pandemic on the society and economy;
• New initiatives announced in the Budget 2021 are ramping up and activities related to those initiatives are on track;
• Increase in revenues due to cyclical programs and restoring paused programs post pandemic.
• Transition of the agency's IT infrastructure and applications to the Cloud

D) Risks and uncertainties

Statistics Canada will address the issues and corresponding uncertainties raised in this Quarterly Financial Report by implementing corresponding risk mitigation measures captured in the 2022-23 Corporate Risk Profile and at the program level.

Statistics Canada continues to pursue and invest in modernizing business processes and tools to maintain its relevance and maximize the value it provides to Canadians. To address uncertainties, the agency is implementing the Census of Environment, the Quality of Life Framework for Canada and the Disaggregated Data Action Plan initiatives to meet the evolving needs of users and remain relevant as an agency.

Statistics Canada requires a skilled workforce to achieve its objectives; however, it is difficult to compete with other organizations in the data ecosystem and the current labour market situation. To address uncertainties, Statistics Canada proactively recruits from universities and colleges across Canada promoting a strong workplace culture, a healthy work-life balance and put forward the Equity, Diversity and Inclusion Action Plan. In addition, the Integrated Business and Human Resources plan targets attracting talented employees with an increased focus on diversity, inclusion and official languages.

Statistics Canada is collaborating with federal partners to access IT services and support to realise its modernization objectives and transition its infrastructure and applications to the Cloud. To address uncertainties, the agency is working closely with its federal partners, while adhering to the agency's notable financial planning management practices and integrated strategic planning framework. Statistics Canada invested in aging IT infrastructure and transitioned to the Cloud. The financial risk related to the cloud cost have materialized as the actual costs of operating on the cloud are higher than estimated. The action plan to contain and optimize cloud operations is essential as we move into 2023-24.

Approval by senior officials

Approved by:

Anil Arora
Chief Statistician
Ottawa, Ontario
February 22, 2023

Kathleen Mitchell
Acting Chief Financial Officer
Ottawa, Ontario
February 8, 2023

Appendix

Statement of Authorities (unaudited)This table displays the departmental authorities for fiscal years 2021-2022 and 2022-2023. The row headers provide information by type of authority, Vote 105 – Net operating expenditures, Statutory authority and Total Budgetary authorities. The column headers provide information in thousands of dollars for Total available for use for the year ending March 31; used during the quarter ended December 31; and year to date used at quarter-end of both fiscal years.

	Fiscal year 2022-2023			Fiscal year 2021–2022
	Total available for use for the year ending March 31, 2023Table note *	Used during the quarter ended December 31, 2022	Year-to-date used at quarter-end	Total available for use for the year ending March 31, 2022Table note *	Used during the quarter ended December 31, 2021	Year-to-date used at quarter-end
	in thousands of dollars
Vote 1 — Net operating expenditures	565,503	146,983	491,638	808,940	146,904	667,199
Statutory authority — Contribution to employee benefit plans	88,455	19,992	59,976	86,434	20,277	60,831
Total budgetary authorities	653,958	166,975	551,614	895,374	167,181	728,030
Table note * Includes only Authorities available for use and granted by Parliament at quarter-end. Return to the first table note * referrer

Departmental budgetary expenditures by Standard Object (unaudited)This table displays the departmental expenditures by standard object for fiscal years 2021-2022 and 2022-2023. The row headers provide information by standard object for expenditures and revenues. The column headers provide information in thousands of dollars for planned expenditures for the year ending March 31; expended during the quarter ended December 31; and year to date used at quarter-end of both fiscal years.

	Fiscal year 2022-2023			Fiscal year 2021–2022
	Planned expenditures for the year ending March 31, 2023	Expended during the quarter ended December 31, 2022	Year-to-date used at quarter-end	Planned expenditures for the year ending March 31, 2022	Expended during the quarter ended December 31, 2021	Year-to-date used at quarter-end
	in thousands of dollars
Expenditures:
(01) Personnel	665,875	178,497	533,055	678,110	169,408	533,296
(02) Transportation and communications	17,089	4,071	11,391	72,692	5,352	58,771
(03) Information	13,136	1,776	5,194	27,901	5,939	21,984
(04) Professional and special services	64,093	7,643	26,992	205,167	8,443	146,547
(05) Rentals	25,824	1,031	15,987	18,503	2,442	20,483
(06) Repair and maintenance	690	188	453	779	242	1,065
(07) Utilities, materials and supplies	2,804	138	515	1,924	162	759
(08) Acquisition of land, buildings and works	807	292	292	756	22	22
(09) Acquisition of machinery and equipment	10,116	2,787	5,094	9,485	2,399	5,101
(10) Transfer payments	-	-	-	-	-	-
(12) Other subsidies and payments	3,524	252	1,542	57	262	830
Total gross budgetary expenditures	803,958	196,675	600,515	1,015,374	194,671	788,858
Less revenues netted against expenditures:
Revenues	150,000	29,700	48,901	120,000	27,490	60,828
Total revenues netted against expenditures	150,000	29,700	48,901	120,000	27,490	60,828
Total net budgetary expenditures	653,958	166,975	551,614	895,374	167,181	728,030