Consolidated specified purpose accounts

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Consolidated specified purpose accounts are particular categories of revenues and expenses whereby legislation requires that revenues received for purposes specified in the legislation be credited to these accounts and that related payments be charged to the accounts. They are principally used where the activities are similar in nature to departmental activities and the transactions do not represent future liabilities to third parties but in essence constitute Government revenues and expenses.

The transactions of these accounts are reported with revenues and expenses, in order to provide a more comprehensive reporting of the Government's operating results.

Further, enabling legislation requires that the transactions in each of these accounts be accounted for separately. Table 4.6 presents a summary of the balances and transactions of these accounts, in the manner required by legislation. A narrative description is provided for accounts reported in Table 4.6. Such descriptions follow the same presentation order as their respective tables.

The financial statements of the Employment Insurance Operating Account, together with the Independent Auditor's Report thereon, are presented at the end of this section.

Table 4.6
Consolidated specified purpose accounts
(in dollars)

  April 1, 2016 Revenues and other credits Expenses and other debits March 31, 2017
External transactions Internal transactions External transactions Internal transactions
Insurance accounts
Agriculture and Agri-Food
Department of Agriculture and Agri-Food
Crop Reinsurance Fund 572,965,250 1,408,768 574,374,018
Less: Interest-bearing loans 277,514,751 277,514,751
Subtotal 295,450,499 1,408,768 296,859,267
Agricultural Commodities Stabilization Accounts 646,510 646,510
Total 296,097,009 1,408,768 297,505,777
Families, Children and Social Development
Department of Employment and Social Development
Employment Insurance Operating Account, Table 4.7 2,914,928,945 22,190,738,685 412,598,027 20,928,627,105 1,590,283,796 2,999,354,756
Finance
Department of Finance
Investors' Indemnity Account 45,303 45,303
Health
Department of Health
Health Insurance Supplementary Account 28,386 28,386
Natural Resources
Department of Natural Resources Nuclear Liability Account 4,025,440 4,025,440
Canadian Nuclear Safety Commission Nuclear Liability Reinsurance Account 3,819,245 206,195 4,025,440
Transport
Department of Transport
Fund for railway accidents involving designated goods 4,985,333 71,420 650 4,913,263
Ship-Source Oil Pollution Fund 411,288,187 102,255 3,214,795 1,857,100 3,293,255 409,454,882
Total insurance accounts 3,626,207,075 22,201,466,676 415,812,822 20,934,581,065 1,593,577,701 3,715,327,807
Other consolidated specified purpose accounts
Canadian Heritage
National Battlefields Commission
Trust Fund 775,695 35,599 3,548 (negative 9,840) 10,260 814,422
Environment and Climate Change
Department of the Environment
Court award deposits other than Environmental Damages Fund 434,534 38,809 38,563 434,780
Environmental Damages Fund 12,429,508 3,123,076 3,554,585 1,871,895 17,235,274
Parks Canada Agency
New Parks and Historic Sites Account 14,718,260 93,076 745,878 664,316 131,635 14,761,263
Total 27,582,302 3,254,961 4,300,463 2,574,774 131,635 32,431,317
Finance
Department of Finance
Canadian Commercial Bank and Northland Bank Holdback Account 246,223,464 246,223,464
Fisheries, Oceans and the Canadian Coast Guard
Department of Fisheries and Oceans
Supplementary Fines Account Species at Risk Act 35,000 35,000
Supplementary Fish Fines Account 1,612,111 102,800 106,715 1,608,196
Total 1,647,111 102,800 106,715 1,643,196
Indigenous and Northern Affairs
Department of Indian Affairs and Northern Development
Cleanup costs for environmental damage caused by Bowater 2,097,840 2,097,840
Environmental Studies Research Fund 1,109,787 660,714 1,109,787 660,714
Total 3,207,627 660,714 2,097,840 1,109,787 660,714
Natural Resources
Department of Natural Resources
Environmental Studies Research Fund 3,246,813 6,038,625 2,061,157 1,661,484 5,562,797
Public Services and Procurement
Department of Public Works and Government Services
Seized Property Proceeds Account 37,509,911 26,273,799 29,258,603 34,525,107
Transport
Department of Transport
Fines for the transportation of dangerous goods 514,074 514,074
Total other consolidated specified purpose accounts 320,706,997 35,705,784 4,964,725 36,089,249 2,913,166 322,375,091
Endowment principal
Environment and Climate Change
Parks Canada Agency
Mackenzie King Trust Account 225,000 225,000
Health
Canadian Institutes of Health Research
Endowments for Health Research 140,267 65,267 75,000
Innovation, Science and Economic development
National Research Council of Canada
H.L. Holmes Fund 5,069,755 66,904 5,136,659
W.G. Schneider Fund 30,000 396 30,396
Social Sciences and Humanities Research Council
Queen's Fellowship Fund 250,000 250,000
Total 5,349,755 67,300 5,417,055
Total endowment principal 5,715,022 67,300 65,267 5,717,055
Total 3,952,629,094 22,237,239,760 420,777,547 20,970,735,581 1,596,490,867 4,043,419,953

Insurance accounts

For the following insurance accounts, revenues and other credits from outside parties totalled $22,201 million ($23,167 million in 2016) while expenses and other debits to outside parties totalled $20,935 million ($19,727 million in 2016) and are reported as expenses in the Consolidated Statement of Operations and Accumulated Deficit.

Revenues and other credits of $416 million ($424 million in 2016) and expenses and other debits of $1,594 million ($1,467 million in 2016) internal to the operations of the Government, have been eliminated in order to present transactions with outside parties.

Crop Reinsurance Fund

This Fund, continued in the accounts of Canada pursuant to subsection 13(1) of the Farm Income Protection Act, provides insurance to participating provinces for deficits they might incur in their agriculture insurance funds. The Crop Reinsurance Fund currently operates under the authority of the Farm Income Protection Act.

The revenues of the Fund come from a percentage of total premiums collected by provinces for the purpose of insurance of agricultural production. Both the amount of revenue collected and expenditures from the Crop Reinsurance Fund paid to provinces are subject to the terms of reinsurance agreements. When there are insufficient revenues in the Crop Reinsurance Fund to make payments, the Minister of Finance may authorize an advance of additional funds to cover these obligations. These advances are recovered from future revenues. Currently, the interest rate earned on surpluses in the Crop Reinsurance Fund and the interest rate charged to advances to the Fund have been set by the Department of Finance at zero per cent.

Agricultural Commodities Stabilization Accounts

The purpose of these accounts was to reduce income loss to producers from market risks through stabilizing prices. Premiums were shared equally by the Government of Canada, the governments of participating provinces and participating producers.

These accounts are continued in the accounts of Canada pursuant to subsection 16(2) of the Farm Income Protection Act. Current activities are limited to collection of accounts receivable. The Agricultural Stabilization Act, under which the commodity accounts formerly operated, has been repealed and replaced by the Farm Income Protection Act effective April 1, 1991.

Employment Insurance Operating Account

The Canada Employment Insurance Commission (the Commission), a departmental corporation named in Schedule II to the Financial Administration Act, administers the Employment Insurance Act (the Act). The Commission is co-managed by Commissioners representative of the Government, workers and employers. The objective of the Act is to provide employment insurance benefits, employment programs and services to eligible workers. The financial transactions relating to this objective are reported through the Employment Insurance Operating Account (the Account).

The Account was established in the accounts of Canada by the Act. All amounts received under the Act are deposited in the Consolidated Revenue Fund and credited to the Account. The benefits and the costs of administration of the Act are paid out of the Consolidated Revenue Fund and charged to the Account.

Employee premium rate for each $100 of insurable earnings was $1.88 from January 1, 2016 to December 31, 2016 for employees without a Provincial Parental Insurance Plan and $1.52 for the others. From January 1, 2017 to March 31, 2017, the rate was $1.63 for employees without a Provincial Parental Insurance Plan and $1.27 for the others.

Table 4.7 presents a statement of the transactions in the Employment Insurance Operating Account.

Table 4.7
Transactions in the Employment Insurance Operating Account
(in millions of dollars)

  2016–2017 2015–2016
Revenues
Premiums
Employers and employeesLink to footnote 1 22,537 23,491
Penalties and interest revenue 66 95
Subtotal 22,603 23,586
Expenses
Benefits 18,644 17,480
Transfers to the provinces—Part II 2,067 1,939
Administration costs 1,585 1,462
Administration cost transferred to provinces 191 191
Bad debts 32 121
Subtotal 22,519 21,193
Net change 84 2,393
Balance at beginning of year 2,915 522
Balance at end of year 2,999 2,915

Investors' Indemnity Account

Section 57 of the Financial Administration Act provides for this account, and for the crediting thereto of the sum of $25,000, such further amounts as are appropriated by Parliament for the purposes of this section, and any recoveries of the losses referred to in section 58 of the Act. This sum was increased to $50,000 by Treasury Board Submission No. 817667 dated December 12, 1991.

Section 58 of the Act states that the Minister may, in accordance with and subject to regulations, pay out of the account, any losses sustained by subscribers for securities who have paid all or part of the purchase price for those securities but have not received the security or repayment of the amount so paid, and losses sustained by any person in the redemption of securities.

Health Insurance Supplementary Account

This account was established pursuant to Vote L16b, Appropriation Act No. 2, 1973, to record payments in respect of persons who, through no fault of their own, have lost or been unable to obtain coverage for the insured health services under the Canada Health Act, and in accordance with the Federal-Provincial Agreement on Eligibility and Portability. Contributions are made by all provinces to the account in proportion to population and are matched by the Federal Government.

Nuclear Liability Account—Department of Natural Resources

This account is a continuation of the Nuclear Liability Reinsurance Account under the previous Nuclear Liability Act. It is established pursuant to sub-section 32(1) of the Nuclear Liability and Compensation Act, to record indemnity fees paid by operators and to provide for payment of any claims arising under the indemnity agreements entered into between the Government and nuclear installation operators.

Nuclear Liability Reinsurance Account

This account was established pursuant to sections 16 and 17 of the Nuclear Liability Act (NLA), to record premiums and to provide for payment of claims arising from accidents at an insured facility. On January 1, 2017, the Nuclear Liability and Compensation Act (NLCA) came into effect and replaced the NLA. The NLCA is administered by the Department of Natural Resources (NRCan); therefore, the liability accumulated under the NLA has been transferred from the Canadian Nuclear Safety Commission to NRCan.

Fund for railway accidents involving designated goods

This account was established pursuant to the Safe and Accountable Rail Act to establish a compensation fund to cover the losses, damages, costs and expenses resulting from a railway accident involving crude oil or other designated goods that exceed the minimum liability insurance coverage. This account is financed by a levy on shipments of crude oil by rail.

Ship-Source Oil Pollution Fund

This account was established pursuant to subsection 2001, c.6 of the Marine Liability Act (previously the Canada Shipping Act), to record levy tonnage payments for oil carried by ships in Canadian waters. Maritime pollution claims, the fee of the Fund Administrator, and related oil pollution control expenses, are to be financed out of the Fund.

Other consolidated specified purpose accounts

For the following other consolidated specified purpose accounts, revenues and other credits from outside parties of $36 million ($40 million in 2016) are reported while expenses and other debits to outside parties of $36 million ($19 million in 2016) are reported in the Consolidated Statement of Operations and Accumulated Deficit.

Revenues and other credits of $5 million ($3 million in 2016), and expenses and other debits of $3 million ($4 million in 2016) internal to the operations of the Government, have been eliminated in order to present transactions with outside parties.

Trust Fund

This account was established at the creation of the National Battlefields Commission for the purpose of acquiring various properties for the development of the park. The funds are received by way of private contributions, from municipal corporations, provincial governments and others, and deposited for the purposes of the Commission, as prescribed for in its incorporation Act. Following the land acquisitions of the Commission, funds remained in the account and increased over a period of years as a result of interest earned, while the Commission was listed in Schedule C of the Financial Administration Act, prior to September 1, 1984.

Court Award Deposits—Other than Environmental Damages Fund

This account was established for the management of court orders/awards or other financial compensation to the Department of Environment that are not under the legal authority of the Environmental Damages Fund.

Environmental Damages Fund

This account was established for the management of court orders/awards or other financial compensation to the Department of Environment for damages to the environment.

New Parks and Historic Sites Account

This account was established pursuant to the Parks Canada Agency Act to record payments to be used to acquire lands or property required to establish any national park, national historic site or other protected heritage area that has not yet attained full operation status, and to make any related contributions.

Canadian Commercial Bank and Northland Bank Holdback Account

This account was established to record the amount held from the recovery of monies received from the winding up of Canadian Commercial Bank and Northland Bank.

During the fiscal year, no claims have been received for potential payments from the holdback.

Supplementary Fines Account—Species at Risk Act

The account was established to record the deposit of funds received from persons declared guilty of offences under the Species at Risk Act, under paragraph 105(h) of the Act.

Supplementary Fish Fines Account

The account was established to record the deposit of funds received from persons declared guilty of offences under the Fisheries Act, under paragraph 79(2)(f) of the Act.

Cleanup costs for environmental damage caused by Bowater

This account was established pursuant to a decision of the Commercial Division of the Superior Court in the Province of Quebec. The balance in the account is to be used to finance the remediation of environmental damage caused by Bowater Canadian Forest Products Inc. relative to a land lease issued by the Department of Indian Affairs and Northern Development. As of fiscal year 2016–2017, the cleanup was completed and the outstanding balance in this consolidated specified purpose account has been transferred to the Indian band funds revenue accounts in Table 6.30 of Section 6 of this volume.

Environmental Studies Research Fund—Department of Indian Affairs and Northern Development

This account was established pursuant to subsection 76(1) of the Canada Petroleum Resources Act. The purpose of the Fund is to finance environmental and social studies pertaining to the manner in which, and the terms and conditions under which, exploration development and production activities on frontier lands, authorized under this Act or any other act of Parliament, should be conducted.

Environmental Studies Research Fund—Department of Natural Resources

This account was established pursuant to subsection 76(1) of the Canada Petroleum Resources Act. The purpose of the Fund is to finance environmental and social studies pertaining to the manner in which, and the terms and conditions under which, exploration development and production activities on frontier lands, authorized under this Act or any other act of Parliament, should be conducted.

Seized Property Proceeds Account

This account was established, pursuant to section 13 of the Seized Property Management Act, to record the net proceeds received from the disposition of seized and forfeited properties to Her Majesty or fines imposed and also funds received from the government of foreign states pursuant to agreements for the purpose of the Act. The Act also provides that the following be charged to the Account: operating expenses incurred in carrying out the purpose of the Act, amounts paid as a result of claims and repayments of advances from the Minister of Finance, interest on drawdown from Seized Property Working Capital Account and distribution of the proceeds to the relevant jurisdictions and the Consolidated Revenue Fund.

Fines for the transportation of dangerous goods

This account was established, pursuant to the Transportation of Dangerous Goods Act, 1992 and related regulations, to record fines levied by courts.

Endowment principal

For the following endowment principal accounts, revenues and other credits from outside parties of $67,000 ($64,000 in 2016) are reported while expenses and other debits to outside parties of $65,000 (nil in 2016) are reported in the Consolidated Statement of Operations and Accumulated Deficit.

Mackenzie King Trust Account

The late The Right Hon W L Mackenzie King bequeathed Laurier House, Ottawa, and the sum of $225,000, to the Government of Canada. The amount of $225,000 was credited to the account and earns interest, in accordance with the terms of section 3 of the Laurier House Act. The interest is to be used to assist in the maintenance of the Laurier House, which is to be preserved as a place of historic interest, and also to provide accommodation for study and research.

Endowments for health research

This account was established by section 29 of the Canadian Institutes of Health Research Act to record various endowments received from donors for the purpose of health research. The interest received is used for the payment of research grants.

H.L. Holmes Fund

This account was established, pursuant to paragraph 5(1)(f) of the National Research Council Act, to record the residue of the estate of H.L. Holmes. Up to two thirds of the yearly net income from the fund shall be used to finance the H.L. Holmes Award on an annual basis. These awards will provide the opportunity to post-doctoral students to study at world famous graduate schools or research institutes under outstanding research persons.

W.G. Schneider Fund

This account was established pursuant to paragraph 5(1)(f) of the National Research Council Act, to record the residue of the estate of W.G. Schneider. The yearly net income from the fund shall be used to finance the Schneider Medal. This award recognizes employees who have made outstanding contributions to the National Research Council of Canada.

Queen's Fellowship Fund

This fund is an endowment of $250,000 that was established by Vote 45a, Appropriation Act No. 5, 1973–74. The interest earned is used for the payment of fellowships to graduate students in certain fields of Canadian studies.

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