POLITICS

Budget watchdog cautions MPs of $5.4B sought in new spending

11/18/2013 01:05 EST | Updated 01/25/2014 04:01 EST
The amount of money the federal government is seeking in new spending from Parliament may require more detailed scrutiny by MPs, says Canada's budget watchdog.

Treasury Board president Tony Clement is now seeking, through the latest supplementary estimates tabled on Nov. 7, an additional $5.4 billion in spending from Parliament.

But parliamentary budget officer Jean-Denis Frechette is telling MPs it is unclear whether all of the $5.4 billion is actually needed given the fact that government has been unable to spend approximately $10 billion it sought from Parliament each year for the last three years.

"Parliamentarians may wish to seek clarification regarding why this level of unspent money remains so high, what measures will be undertaken by departments and agencies to ensure that spending directed by Parliament occurs, and whether all of the $5.4 billion sought in these supplementary estimates is actually required," a report by Frechette concludes.

The additional $5.4 billion in spending sought from Parliament would bring the amount of money Ottawa is authorized to spend in 2013-14 to approximately $259.9 billion, 0.3 per cent higher than what Ottawa was allowed to spend last year.

The government is seeking an additional $5.4 billion for transfer payments and subsidies to third parties, increases in the operating budgets of certain departments and agencies, as well as new spending measures announced in the March budget, according to the PBO report.

Last month, Ottawa reported the deficit in the year 2012-13 was about $7 billion less than it calculated, with the majority of the savings due to cost cutting.

Finance Minister Jim Flaherty's latest economic update said the federal government is on track to balance the budget by 2014-15 with a projected $3.7 billion surplus in 2015-16.

The government announced in the last throne speech that it will reintroduce an operating freeze on departmental spending for two years beginning in March 2014.

The operating budget freeze is expected to generate savings of approximately $500 million in 2014-15 and $1.1 billion in 2015-16.