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Section III - Supplementary Information

Financial Tables


Table 1: Comparison of Planned to Actual Spending (including Full-time Equivalents)
Table 2: Resources by Program Activity
Table 3: Voted and Statutory Items
Table 4: Services Received Without Charge
Table 5: Sources of Respendable and Non-Respendable Revenue
Table 6: Canadian Pari-Mutuel Agency Revolving Fund (Statement of Operations, Statement of Cash Flows and Projected use of Authority)
Table 7: Resource Requirements by Team
Table 8-A: User Fees Act
Table 8-B: Policy on Service Standards for External Fees
Table 9: Details on Project Spending
Table 10: Status Report on Major Crown Projects
Table 11-A: Summary of Transfer Payments by Program Activity
Table 11-B: Details on Transfer Payment Programs (TPPs)
Table 12: Conditional Grants (Foundations)
Table 13: Horizontal Initiatives
NOTE:

The figures in the following set of tables have been rounded to the nearest millions of dollars. For this reason, figures that cannot be listed in millions of dollars are shown as 0.0. Due to rounding, figures may not add to the totals shown.

For the purposes of these tables, where Program Activities are reported, the Corporate Services Program Activity is not reported separately, rather it has been pro-rated to the other Program Activities.

Main Estimates figures are as reported in the 2006-2007 Main Estimates.

Planned figures are as reported in the 2006-2007 Report on Plans and Priorities (RPP).

Authorities are 2006-2007 Main Estimates plus Supplementary Estimates and Allotment transfers received during the 2006-2007 fiscal year, as well as internal adjustments and transfers. Actual figures represent the actual expenditures incurred during the 2006-2007 fiscal year, as reported in the 2006-2007 Public Accounts. In certain cases, where Authorized amounts are unspent, they can be reprofiled for use in future years.


Table 1: Comparison of Planned to Actual Spending (including FTEs)


  2006-2007
($ millions) 2004-05*
Actual
2005-06*
Actual
Main
Estimates
Planned
Spending
Total
Authorities
Actual
Business Risk Management 2,584.7 2,568.3  1,275.9 2,694.7 2,581.6 2,442.9
Food Safety and Food Quality 57.7 57.8 123.0 122.8 89.1 67.8
Markets and International 119.3 117.1 113.9 113.6 120.1 131.1
Environment 276.9 292.3 352.9 355.9 402.3 382.2
Innovation and Renewal 303.3 335.4 346.9 587.1 696.0 549.4
Rural & Co-operatives Secretariats 15.9 26.3 22.8 23.7 22.8 20.8
National Farm Products Council 2.3 3.6 2.7 2.6 2.9 2.5
Canadian Pari-Mutuel Agency 14.0 15.0 15.2 15.2 17.2 13.2
Total Gross 3,374.1 3,415.7 2,253.4 3,915.7 3,932.1 3,609.9
Less Respendable revenue 30.6 34.1 61.7 61.7 61.7 42.1
Total Net 3,343.4 3,381.7 2,191.7 3,853.9 3.870.4 3.567.7
Less: Non-Respendable revenue 45.4 51.7 N/A 21.8 N/A 74.7
Plus: Cost of services received without charge1 46.5 48.1 N/A 46.2 N/A 57.9
Net cost of Department 3,344.5 3,378.1 N/A 3,878.3 N/A 3,550.9
Full-Time Equivalents (FTE's) 6,216 6,225 N/A 6,257 N/A 6,585

Notes:

1 Cost of services received without charge includes accommodation provided by Public Works and Government Services Canada (PWGSC), the employer's share of employees' insurance premiums and expenditures paid by TBS (excluding revolving funds), Workers' Compensation coverage provided by Social Development Canada, and services provided by the Department of Justice Canada (see Table 4).

FTE's = Full-Time Equivalents - reflect only those FTE's funded through the Department's appropriated resources. In addition to the actual FTE's of 6,585, there were 78 FTE's employed by AAFC for research funded through collaborative agreements with industry partners and 29 FTE's funded from other government departments. Also, 429 FTE's were employed as students.

Main Estimates figures are as reported in the 2006-2007 Main Estimates.

Planned Spending figures are as reported in the 2006-2007 Report on Plans and Priorities (RPP). Included were resources anticipated to be brought into the Department's reference levels through Supplementary Estimates including Budget Announcements of $1,662.3 million.

Total Authorities are 2006-2007 Main Estimates plus Supplementary Estimates and Allotment transfers received during the 2006-2007 fiscal year, as well as adjustments to statutory amounts, internal adjustments and transfers (combined total of $1,678.7 million), as reported in the 2006-2007 Public Accounts.

Actual figures represent the actual expenditures incurred during the 2006-2007 fiscal year, as reported in the 2006-2007 Public Accounts. In certain cases, where Authorized amounts are unspent, they can be reprofiled for use in future years.

The figures in the above table have been rounded to the nearest millions of dollars. For this reason, figures that cannot be listed in millions of dollars are shown as 0.0.

Due to rounding, figures may not add to the totals shown.


Table 2: Resources by Program Activities

($ millions) - 2006-2007


  Budgetary
Program Activity Operating Capital Grants Contributions Total: Gross Budgetary Expenditures Less: Respendable Revenue Total: Net Expenditures
Business Risk Management        
Main Estimates 111.7 4.8 5.0 1,154.4 1,275.9 5.5 1,270.4
Planned Spending 214.2 9.1 531.8 1,939.6 2,694.7 5.5 2,689.2
Authorities 179.1 10.8 529.2 1,862.4 2,581.6 5.5 2,576.1
Actual Spending 127.5 5.3 524.3 1,785.7 2,442.9 4.4 2,438.5
Food Safety and Food Quality        
Main Estimates 48.1 2.0 - 73.0 123.0 1.5 121.5
Planned Spending 47.9 2.0 - 73.0 122.8 1.5 121.3
Authorities 53.1 2.7 - 33.3 89.1 1.5 87.6
Actual Spending 55.1 2.2 - 10.5 67.8 1.0 66.8
Markets and International        
Main Estimates 84.6 3.7 - 25.6 113.9 - 113.9
Planned Spending 84.3 3.7 - 25.6 113.6 - 113.6
Authorities 93.1 5.0 - 22.1 120.1 - 120.1
Actual Spending 104.9 4.1 - 22.1 131.1 0.0 131.1
Environment        
Main Estimates 216.9 10.0 - 126.1 352.9 24.5 328.4
Planned Spending 218.0 10.0 - 128.0 355.9 24.5 331.4
Authorities 244.8 13.4 - 144.2 402.3 24.5 377.8
Actual Spending 270.1 13.1 - 98.9 382.2 17.7 364.4
Innovation and Renewal        
Main Estimates 228.1 8.2 31.3 79.4 346.9 15.0 332.0
Planned Spending 252.8 16.4 198.5 119.4 587.1 15.0 572.2
Authorities 291.5 19.3 235.2 149.9 696.0 15.0 681.1
Actual Spending 241.4 9.4 190.2 108.4 549.4 5.1 544.3
Rural & Co-operatives Secretariats        
Main Estimates 12.9 - - 9.9 22.8 - 22.8
Planned Spending 12.8 - - 10.9 23.7 - 23.7
Authorities 13.7 - - 9.1 22.8 - 22.8
Actual Spending 11.7 - - 9.1 20.8 - 20.8
National Farm Products Council        
Main Estimates 2.5 - 0.2 - 2.7 - 2.7
Planned Spending 2.4 - 0.2 - 2.6 - 2.6
Authorities 2.3 - 0.6 - 2.9 - 2.9
Actual Spending 2.5 - - - 2.5 - 2.5
Canadian Pari-Mutuel Agency        
Main Estimates 15.2 - - - 15.2 15.2 -
Planned Spending 15.2 - - - 15.2 15.2 -
Authorities 17.2 - - - 17.2 15.2 1.9
Actual Spending 13.2 - - - 13.2 14.0 (0.8)
Total Main Estimates 720.0 28.6 36.5 1,468.3 2,253.4 61.7 2,191.7
Total Planned Spending 847.6 41.2 730.5 2,296.4 3,915.7 61.7 3,853.9
Total -  Authorities 894.9 51.2 765.0 2,221.0 3,932.1 61.7 3,870.4
Total Actual Spending 826.4 34.1 714.6 2,034.7 3,609.9 42.1 3,567.7

Notes:

Main Estimates figures are as reported in the 2006-2007 Main Estimates

Planned Spending figures are as reported in the 2006-2007 Report on Plans and Priorities (RPP). Included were resources anticipated to be brought into the Department's reference levels through Supplementary Estimates including Budget Announcements of $1,662.3 million.

Authorities are 2006-2007 Main Estimates plus Supplementary Estimates and Allotment transfers received during the 2006-2007 fiscal year, as well as adjustments to statutory amounts, internal adjustments and transfers (combined total of $1,678.7 million), as reported in the 2006-2007 Public Accounts.

Actual Spending figures represents the actual expenditures incurred during the 2006-2007 fiscal year, as reported in the 2006-2007 Public Accounts. In certain cases, where Authorized amounts are unspent, they can be reprofiled for use in future years.

The figures in the above table have been rounded to the nearest millions of dollars. For this reason, figures that cannot be listed in millions of dollars are shown as 0.0.

Due to rounding, figures may not add to the totals shown.


Table 3: Voted and Statutory Items

($ millions) - 2005-2006


Vote or
Statutary item
Truncated Vote or Statutory Wording Main Estimates Planned Spending Total Authorities Actual
1 Operating Expenditures 583.9 705.6 754.1 708.2
5 Capital Expenditures 28.6 41.2 51.2 34.1
10 Grants and Contributions 448.9 913.9 832.8 596.7
13b To write-off the projected net drawdown authority used by the Canadian Pari-Mutual Agency Revolving Fund of up to $1,400,000 effective March 31, 2007 - - 0.0 -
15 Pursuant to Section 29 of the Financial Administration Act, to authorize the Minister of Agriculture and Agri-Food, on behalf of Her Majesty in right of Canada, in accordance with terms and conditions approved by the Minister of Finance, to guarantee payments of an amount not exceeding, at any one time, in aggregate the sum of $1,700,000,000 payable in respect of cash advances provided by producer organizations, the Canadian Wheat Board and other lenders under the Spring credit advance program. 0.0 0.0 0.0 -
15a Pursuant to section 29 of the Financial Administration Act, to authorize the Minister of Agriculture and Agri-Food, on behalf of Her Majesty in right of Canada, in accordance with terms and conditions approved by the Minister of Finance, to guarantee payments of an amount not exceeding, at any one time, in aggregate the sum of $1,500,000,000 payable in respect of cash advances provided by producer organizations, the Canadian Wheat Board and other lenders under the Spring credit advance program and $1,500,000,000 payable in respect of cash advances provided by producer organizations, the Canadian Wheat Board and other lenders under the Enhanced spring credit advance program - - 0.0 -
20 Pursuant to Section 29 of the Financial Administration Act, to authorize the Minister of Agriculture and Agri-Food, on behalf of Her Majesty in right of Canada, in accordance with terms and conditions approved by the Minister of Finance, to guarantee payments of amounts not exceeding, at any time in aggregate, the sum of $140,000,000 payable in respect of line of credit agreements to be entered into by the Farm Credit Corporation for the purpose of the Renewed (2003) national biomass ethanol program. 0.0 0.0 0.0 -
(S) Grants to agencies established under the Farm Products Agencies Act 0.2 0.2 0.6 -
(S) Grants in support of the Grain and oilseed payment program - - (0.1) (0.1)
(S) Grant Payments for the Golden nematode disaster program - - 1.0 1.0
(S) Class grant payments for the Transitional industry support payment - - (2.6) (2.6)
(S) Class grant payments for the Farm income payment - - (2.8) (2.8)
(S) Canadian cattlemen's association legacy fund 5.0 5.0 4.9 4.9
(S) Grant Payments for the Canadian agricultural income stabilization program inventory transition initiative - 481.0 431.0 431.0
(S) Contributions in support of business risk management programs under the agricultural policy framework - Canadian agricultural income stabilization program 570.0 617.4 933.3 933.3
(S) Contributions in support of business risk management programs under the agricultural policy framework - Production insurance 407.0 407.0 343.1 343.1
(S) Payments in connection with the Agricultural Marketing Programs Act 65.5 91.5 10.6 10.6
(S) Action Plan - Agriculture Disaster Assistance - 110.8 - -
(S) Contributions in support of business risk management programs under the agricultural policy framework - Agriculture policy initiatives 4.2 4.2 1.7 1.7
(S) Loan guarantees under the Farm Improvement and Marketing Cooperatives Loans Act 4.0 4.0 0.0 0.0
(S) Contributions payments for the Canadian agricultural income stabilization program inventory transition initiative - 392.0 442.0 442.0
(S) Contributions for agricultural risk management Spring credit advance program business risk management -   (1.7) (1.7)
(S) Class contribution payments for Repositioning of the canadian beef and cattle industry -   (0.0) (0.0)
(S) Class contribution payments for the Transitional industry support program -   (1.6) (1.6)
(S) Class contribution payments for the Farm income payment -   (1.3) (1.3)
(S) Contributions in support of business risk management programs under the agricultural policy framework Province-based programs -   (1.9) (1.9)
(S) Bovine spongiform encephalopathy recovery program -   (2.3) (2.3)
(S) Contributions to a transition to future risk management programming -   (0.6) (0.6)
(S) Contributions to employee benefit plans 74.3 80.2 74.0 74.0
(S) Minister of Agriculture and Agri-Food - Salary and motor car allowance 0.1 0.1 0.1 0.1
(S) Refunds of amounts credited to revenues in previous years - - 0.1 0.1
(S) Spending of proceeds from the disposal of surplus Crown assets - - 2.9 2.7
(S) Collection agency fees - - 0.0 0.0
(S) Canadian Pari-Mutual Agency Revolving Fund - - 1.9 (0.8)
TOTAL DEPARTMENT 2,191.7 3,853.9 3,870.4 3,567.7

Notes:
(S) denotes a Statutory Item

Main Estimates figures are as reported in the 2006-2007 Main Estimates

Planned Spending figures are as reported in the 2006-2007 Report on Plans and Priorities (RPP). Included were resources anticipated to be brought into the Department's reference levels through Supplementary Estimates including Budget Announcements of $1,662.3 million.

Total Authorities are 2006-2007 Main Estimates plus Supplementary Estimates and Allotment transfers received during the 2006-2007 fiscal year, as well as adjustments to statutory amounts, internal adjustments and transfers (combined total of $1,678.7 million), as reported in the 2006-2007 Public Accounts.

Actual figures represent the actual expenditures incurred during the 2006-2007 fiscal year, as reported in the 2006-2007 Public Accounts. In certain cases, where Authorized amounts are unspent, they can be reprofiled for use in future years.

The figures in the above table have been rounded to the nearest millions of dollars. For this reason, figures that cannot be listed in millions of dollars are shown as 0.0.

Due to rounding, figures may not add to the totals shown.


Table 4: Services Received Without Charge


($ millions) 2006 - 2007
Accommodation provided by Public Works and Government Services Canada (PWGSC) 19.7
Contributions covering employers' share of employees' insurance premiums and expenditures paid by the Treasury Board of Canada Secretariat (TBS) (excluding revolving funds) 34.9
Worker's compensation coverage provided by Human Resources and Skills Development Canada (HRSDC) 1.7
Salary and associated expenditures of legal services provided by The Department of Justice Canada 1.6
Total 2006-2007 Services Received Without Charge 57.9

The figures in the above table have been rounded to the nearest millions of dollars. For this reason, figures that cannot be listed in millions of dollars are shown as 0.0.

Due to rounding, figures may not add to the totals shown.


Table 5: Sources of Respendable and Non-Respendable Revenue


Respendable Revenue
($ millions) 2004-2005 2005-2006 2006-2007
  Actual Actual Estimates Main Spending Planned Authorities Total Actual
Business Risk Management
Collaborative research agreements and research services - - - - - 0.0
Canadian Agricultural Income Stabilization (CAIS) – Admin. fees 1.7 4.7 5.5 5.5 5.5 4.4
Total – Business Risk Management 1.7 4.7 5.5 5.5 5.5 4.4
Food Safety and Food Quality
Collaborative research agreements and research services - 0.0 1.5 1.5 1.5 1.0
Total – Food Safety and Food Quality - 0.0 1.5 1.5 1.5 1.0
Markets and International
Collaborative research agreements and research services - - - - - 0.0
Total – Markets and International - - - - - 0.0
Environment
Collaborative research agreements and research services     5.5 5.5 5.5 0.7
Community Pastures 14.9 12.9 19.0 19.0 19.0 17.0
Total – Environment 14.9 12.9 24.5 24.5 24.5 17.7
Innovation and Renewal
Collaborative research agreements and research services - 2.6 15.0 15.0 15.0 5.1
Total – Innovation and Renewal - 2.6 15.0 15.0 15.0 5.1
Canadian Pari-Mutuel Agency
Canadian Pari-Mutuel Agency Revolving Fund 14.0 13.8 15.2 15.2 15.2 14.0
Total – Canadian Pari-Mutuel Agency 14.0 13.8 15.2 15.2 15.2 14.0
Total Respendable Revenue 30.6 34.1 61.7 61.7 61.7 42.1

 


Non-Respendable Revenue
($ millions) 2004-2005 2005-2006 2006-2007
  Actual Actual Estimates Main Spending Planned Authorities Total Actual
Business Risk Management
Refund of Previous Years' Expenditures 21.6 3.7 N/A 5.0 N/A 0.9
Service and Service Fees 0.9 1.0 N/A 0.1 N/A 0.9
Privileges. Licences and Permits 0.2 0.4 N/A 0.3 N/A 0.5
Return on Investments 0.7 1.4 N/A 0.5 N/A 1.5
Proceeds from Sales of Crown Assets 0.0 0.6 N/A 0.0 N/A 0.3
Other non-tax revenues 0.9 29.1 N/A 0.6 N/A 47.9
Total Business Risk Management 24.4 36.2 N/A 6.5 N/A 52.0
Food Safety and Food Quality
Refund of Previous Years' Expenditures 0.0 0.1 N/A 0.1 N/A 0.0
Service and Service Fees 0.3 0.3 N/A 0.3 N/A 0.0
Privileges. Licences and Permits 0.3 0.3 N/A 0.3 N/A 0.3
Return on Investments3 0.4 0.5 N/A 0.2 N/A 0.6
Proceeds from Sales of Crown Assets 0.2 0.2 N/A 0.1 N/A 0.1
Other non-tax revenues 0.6 0.0 N/A 0.2 N/A 0.7
Total Food Safety and Food Quality 1.8 1.3 N/A 1.2 N/A 1.7
Markets and International
Refund of Previous Years' Expenditures 0.2 0.3 N/A 0.2 N/A 0.0
Service and Service Fees 0.0 0.0 N/A 0.1 N/A 0.0
Privileges, Licences and Permits 0.2 0.2 N/A 0.2 N/A 0.2
Return on Investments3 0.6 0.8 N/A 0.4 N/A 1.1
Proceeds from Sales of Crown Assets 0.0 0.0 N/A 0.0 N/A 0.0
Other non-tax revenues 1.2 0.0 N/A 0.4 N/A 0.9
Total Markets and International 2.3 1.4 N/A 1.3 N/A 2.3
Environment
Refund of Previous Years' Expenditures - 0.3 N/A 0.3 N/A 0.2
Service and Service Fees 0.4 (0.0) N/A 0.3 N/A 0.0
Privileges, Licences and Permits 0.5 0.5 N/A 1.0 N/A 0.9
Return on Investments3 1.5 2.0 N/A 1.0 N/A 3.0
Proceeds from Sales of Crown Assets 0.6 0.6 N/A 0.5 N/A 0.5
Other non-tax revenues 2.4 0.1 N/A 1.3 N/A 2.2
Total Environment 5.5 3.4 N/A 4.5 N/A 6.9
Innovation and Renewal
Refund of Previous Years' Expenditures 0.2 0.4 N/A 0.2 N/A 0.1
Service and Service Fees 0.0 0.0 N/A 0.2 N/A 0.0
Privileges, Licences and Permits 0.6 0.6 N/A 4.5 N/A 5.1
Return on Investments3 1.6 2.3 N/A 0.9 N/A 2.6
Proceeds from Sales of Crown Assets 6.0 6.1 N/A 1.5 N/A 1.8
Other non-tax revenues 2.8 0.1 N/A 1.0 N/A 2.0
Total Innovation and Renewal 11.3 9.4 N/A 8.3 N/A 11.7
Rural and Co-operatives Secretariats
Refund of Previous Years' Expenditures 0.0 0.0 N/A 0.0 N/A 0.0
Service and Service Fees - 0.0 N/A - N/A -
Privileges, Licences and Permits - - N/A - N/A -
Return on Investments3 - - N/A - N/A -
Proceeds from Sales of Crown Assets - - N/A - N/A -
Other non-tax revenues 0.1 0.0 N/A 0.0 N/A 0.1
Total Rural and Co-operatives Secretariats 0.1 0.0 N/A 0.0 N/A 0.1
National Farm Products Council
Refund of Previous Years' Expenditures - - N/A - N/A 0.0
Service and Service Fees - - N/A - N/A -
Privileges, Licences and Permits - - N/A - N/A -
Return on Investments - - N/A - N/A -
Proceeds from Sales of Crown Assets - - N/A - N/A -
Other non-tax revenues - - N/A - N/A 0.0
Total National Farm Products Council - - N/A - N/A 0.0
Total Non-Respendable Revenue 45.4 51.7 N/A 21.8 N/A 74.7

Notes:
Respendable revenues are generated by the Community Pastures Program, collaborative research agreements and research services, administration fees related to the Canadian Agricultural Income Stabilization (CAIS) program, and the Canadian Pari-Mutuel Agency Revolving Fund. In accordance with Treasury Board policy, the Department can generate and spend up to 125 percent of its vote-netted revenue authority. Respendable revenues have increased mainly due to revenue collected under the Community Pastures Program and the collaborative research agreements and research services.

Non-respendable revenues include such items as refunds of previous years’ expenditures, proceeds from the sales of Crown Assets, privileges, licenses and permits. Non-respendable revenues are higher this year mainly due to refunds of previous years’ expenditures.

The figures in the above tables have been rounded to the nearest millions of dollars. For this reason, figures that cannot be listed in millions of dollars are shown as 0.0.

Due to rounding, figures may not add to the totals shown.


Canadian Pari-Mutuel Agency Revolving Fund


Statement of Operations
  2004-2005 2005-2006 2006-2007
($ millions) Actual Actual Main Estimates Planned Spending Authorized Actual
Respendable Revenue 14.1 13.9 15.2 15.2 15.2 13.8
Expenses        
Operating:            
Salaries and employee benefits 5.0 5.9 5.0 5.0 5.0 5.6
Depreciation 0.2 0.2 0.1 0.1 0.1 0.2
Administrative and support services 8.1 8.7 9.7 9.7 9.7 8.1
Utilities, materials and supplies 0.3 0.2 0.4 0.4 0.4 0.2
Total Operating 13.6 15.0 15.2 15.2 15.2 14.0
Surplus (Deficit) 0.5 (1.1) - - - (0.3)
Statement of Cash Flows
  2004-2005 2005-2006 2006-2007
($ millions) Actual Actual Main Estimates Planned Spending Authorized Actual
Surplus (Deficit) 0.5 (1.1) - - - (0.3)
Add non-cash items:            
Depreciation/amortisation 0.2 0.2 0.1 0.1 0.1 0.2
Other (0.5) (0.1) - - - 0.9
Investing activities:            
Acquisition of depreciable assets (0.1) (0.1) (0.1) (0.1) (0.1) (0.0)
Cash surplus (requirement) 0.1 (1.2) - - - (0.8)
Projected Use of Authority
  2004-2005 2005-2006 2006-2007
($ millions) Actual Actual Main Estimates Planned Spending Authorized Actual
Authority1 2.0 2.0 2.0 2.0 2.0 2.0
Drawdown:            
Balance as at April 1 1.0 1.1 1.1 1.1 (0.1) (0.1)
Projected Surplus (Drawdown) 0.1 (1.2) - - - 0.8
Total Drawdown 1.1 (0.1) 1.1 1.1 (0.1) 0.7
Projected Balance at March 31 3.1 1.9 3.1 3.1 1.9 2.7
Notes:

1 $2 million is the maximum amount that may be drawn down from the Consolidated Revenue Fund (CRF) at any time.

The figures in the above tables have been rounded to the nearest millions of dollars. For this reason, figures that cannot be listed in millions of dollars are shown as 0.0.

Due to rounding, figures may not add to the totals shown.


Table 7: Resource Requirements by Team*


($ millions) 2006-2007
Program Activity / Team Business Risk Management Food Safety and Food Quality Markets and International Environment Innovation and Renewal Rural and Co-operatives Secretariats National Farm Products Council Canadian Pari-Mutuel Agency Total
Business Risk Management Team
Planned Spending 11.7 - - - - - - - 11.7
Actual Spending 18.9 - - - - - - - 18.9
Food Safety and Quality Team
Planned Spending - 28.2 - - - - - - 28.2
Actual Spending - 28.6 - - - - - - 28.6
Environment Team
Planned Spending - - - 99.7 - - - - 99.7
Actual Spending - - - 132.6 - - - - 132.6
Innovation and Renewal Team
Planned Spending - - - - 200.3 - - - 200.3
Actual Spending - - - - 188.9 - - - 188.9
Markets and Trade Team
Planned Spending - - 50.6 - - - - - 50.6
Actual Spending 0.0 - 52.7 - - - - - 52.8
Program Delivery Team1
Planned Spending 2,581.3 75.0 27.3 139.2 296.6 - - - 3,119.4
Actual Spending 2,333.5 12.8 24.0 114.4 262.4 - - - 2,747.0
Enabling Teams2
Planned Spending 92.4 16.6 32.8 85.0 68.9 - - - 295.7
Actual Spending 82.6 23.8 48.7 105.8 89.5 - - - 350.3
Corporate Offices3
Planned Spending 3.7 1.5 2.8 7.5 6.4 23.7 2.6 - 48.3
Actual Spending 5.5 1.2 4.2 11.0 9.4 20.8 2.5 - 55.5
Canadian Pari-Mutuel Agency
Planned Spending - - - - - - - - -
Actual Spending - - - - - - - (0.8) (0.8)
Total Planned Spending 2,689.2 121.3 113.6 331.4 572.2 23.7 2.6 - 3,853.9
Total Actual Spending 2,438.5 66.8 131.1 364.4 544.3 20.8 2.5 (0.8) 3,567.7
Notes:

* The authorities (Planned Spending) are granted to the Department, and are notionally allocated to Teams. These authorities, which are managed at the departmental level, have not been exceeded.

1 Program Delivery Team resources are significantly higher than those of the other Teams as they include the majority of the Department's resources for Grants and Contributions.

2 Enabling Teams include Assets Management, Communications and Consultations, Finance, Human Resources, Information Systems and Policy.

3 Corporate Offices include Executive Offices, Rural and Co-operatives secretariats, National Farm Products Council, Legal Services, Audit and Evaluation, ADM Offices, Values and Ethics, Financial Management & Accountability Project, and Strategic Management.

Planned spending figures are as reported in the 2006-2007 Report on Plans and Priorities (RPP). Included were resources anticipated to be brought into the Department's reference levels through Supplementary Estimates including Budget Announcements of $1,662.3 million.

Actual Spending figures represent the actual expenditures incurred during the 2006-2007 fiscal year, as reported in the 2006-2007 Public Accounts by Program Activity. In certain cases, where Authorized amounts are unspent, they can be reprofiled for use in future years.

The figures in the above table have been rounded to the nearest millions of dollars. For this reason, figures that cannot be listed in millions of dollars are shown as 0.0.

Due to rounding, figures may not add to the totals shown.


Table 8-A: User Fees Act(1)


A.         2006-07   Planning Year
User Fee Fee Type Fee Setting Authority (B) Date Last Modified Forecast Revenue ($000) Actual Revenue ($000) Full Cost ($000) Performance Standard Performance Results Fiscal Year Forecast Revenue ($000) Estimated Full Cost ($000)
Farm Improvement and Marketing Cooperatives Loans Act(FIMCLA) Registration Fees R FIMCLA Regulations May 31, 1999 545.0 577.0 51.0 Program loan loss percentage less than 2%. Loan losses as a percentage of registered loans is 0.66%. 2007-08

495.0 1,343.0
2008-09 n/a n/a
2009-10 n/a n/a
Fees charged for the processing of access requests filed under The Access to Information Act (ATIA)(2) O Access to Information Act 1992 1.5 2.3 840.0 Response provided within 30 days following receipt of request; the response time may be extended pursuant to section 9 of the ATIA, Notice of extension to be sent within 30 days after receipt of request. The Access to Information Act provides fuller details:
http://lois.justice.gc.ca/en/A-1/index.html
Statutory deadlines met 95.7% of the time 2007-08

2.5 961.0
2008-09 2.5 961.0
2009-10 2.5 961.0
2006-2007 Sub-total (R) Regulatory Service 545.0 577.0 51.0          
Sub-total (O) Other Products and Service 1.5 2.3 840.0          
Total 546.1 579.3 891.0          
2007-2008 Sub-total (R) Regulatory Service             495.0 1,343.0
Sub-total (O) Other Products and Service             2.5 961.0
Total             497.5 2,304.0
2008-2009 Sub-total (R) Regulatory Service             n/a n/a
Sub-total (O) Other Products and Service             2.5 961.0
Total             2.5 961.0
2009-2010 Sub-total (R) Regulatory Service             n/a n/a
Sub-total (O) Other Products and Service             2.5 961.0
Total             2.5 961.0
B. Date Last Modified: N/A

C. Other Information:
(1) The DPR instructions advised that this table be used only for revenues under the User Fee Act. The preliminary advice from our legal counsel indicated that only the FIMCLA program as well as the fees charged under ATIP are subject to the User Fee Act.
(2) It is the Department’s practice to waive fees where the total owing per request amounts to less than $25.

Notes:
According to prevailing legal opinion, where the corresponding fee introduction or most recent modification occurred prior to March 31, 2004 the:

  • Performance standard, if provided, may not have received Parliamentary review;
  • Performance standard, if provided, may not respect all establishment requirements under the UFA (e.g. international comparison; independent complaint address)
  • Performance result, if provided, is not legally subject to UFA section 5.1 regarding fee reduction for failed performance

Table 8-B: Policy on Service Standards for External Fees

Agriculture and Agri-Food Canada charges the following external fees on a non-contractual basis:

  1. Farm Improvement and Marketing Cooperatives Loans Act (FIMCLA)
  2. Access to Information Act (ATIA)
  3. Canadian Agricultural Income Stabilization program (CAIS)

Supplementary information on Service Standards for External Fees can be found at: http://www.tbs-sct.gc.ca/rma/dpr3/06-07/index_e.asp

Table 9: Details on Project Spending 1

The following projects have or are expected to exceed the Department's delegated project approval level of $5 million:

  1. Skyline Campus
  2. Enhancements to the delivery systems for the Business Risk Management Programs under the Agricultural Policy Framework
  3. Duncairn Dam (Water Control Structures)
  4. National Land and Water Information Service (NLWIS)
  5. Junction Dam Rehabilitation
  6. St. Boniface General Hospital
  7. Dairy Research Facility
  8. Greenhouse and Growth Chamber Facility

For further information on the above-mentioned projects see http://www.tbs-sct.gc.ca/est-pre/estime.asp

Table 10. Status Report on Major Crown Projects for Agriculture and Agri-Food Canada

Agriculture and Agri-Food Canada was the lead department and managed the following Major Crown project:

National Land and Water Information Service (NLWIS)

For further information on the above-mentioned Major Crown project see http://www.tbs-sct.gc.ca/est-pre/estime.asp

Table 11-A: Summary of Transfer Payments by Program Activity for Agriculture and Agri-Food Canada


($ millions) 2004-2005 2005-2006 2006-2007
Actual Spending Actual Spending Planned Spending Total Authorities Actual Spending Variance between
Actual and Planned
Grants
Business Risk Management 829.9 693.7 531.8 529.2 524.3 7.5
Environment
0.0 - - - - -
Innovation and Renewal
28.3 34.0 198.5 235.2 190.2 8.3
National Farm Products Council - - 0.2 0.6 - 0.2
Total Statutory Grants 829.9 693.7 486.2 431.9 431.3 54.9
Total Voted Grants 28.3 34.0 244.3 333.1 283.3 (39.0)
Total Grants 858.2 727.7 730.5 765.0 714.6 15.9
         
Contributions
Business Risk Management 1,638.9 1,760.1 1,939.6 1,862.4 1,785.7 153.8
Food Safety and Food Quality 4.5 6.1 73.0 33.3 10.5 62.4
Environment 37.5 53.1 128.0 144.2 98.9 29.0
Innovation and Renewal 49.8 68.3 119.4 149.9 108.4 11.0
Markets and International 26.7 24.2 25.6 22.1 22.1 3.6
Rural and Co-operatives 3.8 8.6 10.9 9.1 9.1 1.8
Total Statutory Contributions 1,572.7 1,657.1 1,626.8 1,721.3 1,721.3 (94.5)
Total Voted Contributions 188.4 263.2 669.6 499.7 313.4 356.1
Total Contributions 1,761.1 1,920.2 2,296.4 2,221.0 2,034.7 261.6
         
Total Statutory Grants & Contributions 2,402.6 2,350.8 2,113.0 2,153.2 2,152.6 (39.6)
Total Voted Grants & Contributions 216.7 297.2 913.9 832.8 596.7 317.2
Total Grants & Contributions 2,619.3 2,647.9 3,026.9 2,986.0 2,749.3 277.6
Notes:
Planned figures are as reported in the 2006-2007 Report on Plans and Priorities (RPP). Included were Transfer Payment resources anticipated to be brought into the Department's reference levels through Supplementary Estimates including Budget Announcements of $1522.1 million.

Total Authorities are 2006-2007 Main Estimates plus Supplementary Estimates and Allotment transfers received during the 2006-2007 fiscal year, as well as adjustments to statutory amounts, internal adjustments and transfers (combined total Transfer Payment funding of $1481.2 million), as reported in the 2006-2007 Public Accounts

Actual spending figures represent the actual expenditures incurred during the 2006-2007 fiscal year, as reported in the 2006-2007 Public Accounts. In certain cases, where Authorized amounts are unspent, they can be reprofiled for use in future years.

Variance between Planned and Actual of $277.6 million is mainly due to funding requested for reprofiling to future years under the following programs: contributions under the Agricultural Policy Framework, the Canadian Farm Families Options Program, New Opportunities for Agriculture Initiatives and the Agricultural Bioproducts Innovation Program. As well as funding earmarked in the government fiscal plan for Agricultural Disasters that was not required in the 2006-07 fiscal year.


Table 11-B: Details on Transfer Payment Programs

Agriculture and Agri-Food Canada managed the following transfer payment programs in excess of $5 million:

  1. Canadian Agricultural Income Stabilization (CAIS)
  2. Canadian Agricultural Income Stabilization Inventory Transition Initiative (CITI)
  3. Production Insurance
  4. Cover Crop Protection
  5. BSE/Cull Cow/ Specified Risk Materials
  6. Spring Credit Advance Program (SCAP)/Enhanced Spring Credit Advance Program(ESCAP)
  7. Payments in connection with the Agricultural Marketing Programs Act (AMPA)
  8. Contributions for Agriculture and Agri-Food Sector Assistance - Environment
  9. Contributions for Agriculture and Agri-Food Sector Assistance - Food Safety and Food Quality
  10. Canadian Farm Families Options
  11. Advancing Canadian Agriculture and Agri-Food (ACAAF)
  12. Contributions for Agriculture and Agri-Food Sector Assistance - Science and Innovation
  13. Contributions for Agriculture and Agri-Food Sector Assistance - Renewal
  14. Prairie Grain Roads
  15. Contributions in Support to Rural Canada and Development in the Area of Co-operatives Framework
  16. Contributions for Agriculture and Agri-Food Sector Assistance - International (Canadian Agriculture and Food International)
  17. Plum Pox Eradication

Further information on these transfer payment programs can be found at http://www.tbs-sct.gc.ca/est-pre/estime.asp .

Table 12: Conditional Grant (Foundation)

Agriculture and Agri-Food Canada managed the following transfer payment (conditional grant) program in excess of $5 million:

Canadian Agri-Food Policy Institute (CAPI)

Further information on this Conditional Grant can be found at http://www.tbs-sct.gc.ca/est-pre/estime.asp .

Table 13: Horizontal Initiatives

Agriculture and Agri-Food Canada is involved in the following horizontal initiatives:

  1. AAFC-Department of Foreign Affairs and International Trade (DFAIT) MOU on Agri-Food Specialists Positions Abroad
  2. Bovine Spongiform Encephalopathy (BSE) Recovery Program (federal/provincial agreement)
  3. Canadian Agricultural Income Stabilization program (CAIS)
  4. Canadian Agricultural Skills Service (CASS)
  5. Co-operatives Secretariat
  6. Farm Business Services
  7. MOU with Canadian Food Inspection Agency (CFIA) on Food Safety and Quality
  8. MOU with Environment Canada (EC) on the National Agri-Environmental Standards Initiative (NAESI)
  9. MOU with Health Canada (HC) on Food Safety and Quality and Environment
  10. Production Insurance
  11. Rural Development

Further information on these horizontal initiatives can be found at http://www.tbs.-sct.gc.ca/rma/eppi-ibdrp/hrdb-rhbd/pforil_e.asp


Financial Statements (Unaudited)

For the year ended March 31, 2007

Statement of Management Responsibility

Responsibility for the integrity and objectivity of the accompanying financial statements for the year ended March 31, 2007 and all information contained in these statements rests with departmental management.  These financial statements have been prepared by management in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.

Management is responsible for the integrity and objectivity of the information in these financial statements.  Some of the information in the financial statements is based on management's best estimates and judgment and gives due consideration to materiality.  To fulfil its accounting and reporting responsibilities, management maintains a set of accounts that provides a centralized record of the department's financial transactions.  Financial information submitted to the Public Accounts of Canada and included in the department's Departmental Performance Report is consistent with these financial statements.

Management maintains a system of financial management and internal control designed to provide reasonable assurance that financial information is reliable, that assets are safeguarded and that transactions are in accordance with the Financial Administration Act, are executed in accordance with prescribed regulations, within Parliamentary authorities, and are properly recorded to maintain accountability of Government funds.  Management also seeks to ensure the objectivity and integrity of data in its financial statements by careful selection, training and development of qualified staff, by organizational arrangements that provide appropriate divisions of responsibility, and by communication programs aimed at ensuring that regulations, policies, standards and managerial authorities are understood throughout the department. 

The departmental Audit and Evaluation committee oversees and approves the planning and reporting of audits, evaluations and reviews of departmental policies, organizations, programs and practices.

The financial statements of the department have not been audited.


Yaprak Baltacioglu, Deputy Head
Ottawa, Canada
August 08, 2007
  Pierre Corriveau, Acting Senior Financial Officer


Agriculture and Agri-Food Canada
Statement of Operations (Unaudited)
For the year ended March 31
(in thousands of dollars)
  2007   2006
Expenses (Note 4)
Business risk management $ 2,840,160 $ 2,551,565
Innovation and renewal   565,673   353,809
Environment   397,012   300,786
Markets and international   137,313   120,167
Foodsafety and food quality   70,622   59,805
Rural and cooperatives secretariat   20,865   27,587
Canadian Pari-Mutual Agency   14,043   15,178
National Farm Products Council   2,571   3,849
    4,048,259   3,432,746


Revenues (Note 5)
Business risk management   86,092   114,026
Innovation and renewal   16,285   12,393
Environment   24,122   16,556
Markets and international   2,144   1,390
Food safety and food quality   2,481   1,438
Rural and cooperatives secretariat   -   266
Canadian Pari-Mutual Agency   13,753   13,936
National Farm Products Council   -   51
    144,877   160,056
Net cost of operations $ 3,903,382  $ 3,272,690

The accompanying notes form an integral part of these financial statements.


AGRICULTURE AND AGRI-FOOD CANADA
Statement of Financial Position (Unaudited)
As at March 31
(in thousands of dollars)
    2007   2006
Assets
Financial assets
Cash $ 657 $ 6,620
Accounts receivable (Note 6)   124,468   87,968
Loans and advances (Note 7)   580,627   654,067
Investment in a Crown corporation (Note 8)   1,208,333   1,208,333
    1,914,085   1,956,988
Non-financial assets
Prepaid expenses and inventory   2,579   3,770
Tangible capital assets (Note 9)   348,069   340,802
    350,648   344,572
  $ 2,264,733 $ 2,301,560
Liabilities and Equity of Canada
Liabilities
Accounts payable and accrued liabilities (Note 10) $ 2,848,583 $ 2,403,583
Accrued salaries and vacation   52,483   45,305
Deferred revenue (Note 11)   11,912   17,266
Employee future benefits (Note 12)   96,878   92,316
Other liabilities (Note 13)   495,186   705,987
    3,505,042   3,264,457
Equity of Canada (Note 17)   (1,240,309)   (962,897)
  $ 2,264,733 $ 2,301,560

Contingencies (Note 14)
Contractual obligations (Note 15)

The accompanying notes form an integral part of these financial statements.


AGRICULTURE AND AGRI-FOOD CANADA
Statement of Equity of Canada (Unaudited)
For the year ended At As at March 31, 2007
(in thousands of dollars)
    2007   2006
Equity of Canada, beginning of year $ (962,897) $ (2,208,197)
Net cost of operations   (3,903,382)   (3,272,690)
Current year appropriations used (Note 3)   3,567,722   3,381,692
Revenue not available for spending   (26,544)   (20,738)
Refunds of previous years expenditures   (521)   (58,279)
Change in net position in the Consolidated Revenue Fund (Note 3)   27,408   1,167,225
Services received without charge (Note 16)   57,905   48,090
Equity of Canada, end of year (Note 17) $ (1,240,309) $ (962,897)

The accompanying notes form an integral part of these financial statements.


AGRICULTURE AND AGRI-FOOD CANADA
Statement of Cash Flow (Unaudited)
For the year ended March 31, 2007
(in thousands of dollars)
    2007   2006
Operating activities
Net cost of operations $ 3,903,382 $ 3,272,690
Non-cash items :
Amortization of tangible capital assets   (37,509)   (36,849)
(Loss) Gain on disposal and non-cash changes in tangible capital assets   (257)   (280)
Services received without charge   (57,905)   (48,090)
Variances in Statement of Financial Position:
Increase (decrease) in accounts receivable   36,500   44,910
Increase (decrease) in loans and advances   (73,440)   29,983
Increase (decrease) in prepaid expenses and inventory   (1,191)   1,396
Decrease (increase) in liabilities   (240,585)   1,156,196
Cash used by operating activities   3,528,995   4,419,956
Capital investment activities
Acquisition of tangible capital assets   45,145   29,644
Proceeds from disposal of tangible capital assets   (112)   (245)
Cash used by capital investment activities   45,033   29,399
Investing activities
Increase (decrease)in investment in a Crown corporation   -   15,000
Cash used by investing activities   -   15,000
Financing activities
Net cash provided by Government of Canada   (3,568,065)   (4,469,900)
Net cash used   5,963   (5,545)
Cash, beginning of year   6,620   1,075
Cash, end of year $ 657 $ 6,620

The accompanying notes form an integral part of these statements.

1. Authority and objectives

The Department of Agriculture and Agri-Food Act of 1994 establishes the Department of Agriculture and Agri-Food as a Department of the Government of Canada. Under the Act, the Minister is responsible for agriculture, products derived from agriculture and research related to agriculture and products derived from agriculture including the operation of experimental farm stations, unless they have been assigned by law to another department, board or agency.

The Department's objective is to promote and support, in a sustainable manner, a growing, competitive, market-oriented agriculture and agri-food industry with principle emphasis on eight program activities:

Business risk management

Enhancing the producer's capacity to manage risk, and increasing the sector's viability and profitability.

Innovation and renewal

Equipping the sector with new business and management skills, bioproducts, knowledge-based production systems and strategies to capture opportunities and manage change.

Environment

Achieving environmental sustainability of the sector and progress in the areas of soil, water, air and biodiversity.

Markets and international

Expanding international opportunities for the Canadian agri-food sector.

Food safety and food quality

Minimizing the risk and impact of food-borne hazards on human health, increasing consumer confidence and improving the sector's ability to meet or exceed market requirements for food products.

Rural and cooperatives secretariat

Leads an integrated, government-wide approach, called the Canadian Rural Partnership, through which the government aims to co-ordinate its economic, social, environmental and cultural policies towards the goal of economic and social renewal of rural Canada.

Facilitating relations between cooperatives and federal departments and agencies with legislation or policies affecting cooperatives. As well, the Secretariat provides advice across government on policies affecting cooperatives, coordinates the implementation of such policies, and acts as a centre of expertise on cooperatives within the federal government.

Canadian Pari-Mutuel Agency

To regulate and supervise pari-mutuel betting for the protection of the betting public on a full cost recovery basis, in the most effective and efficient manner possible.

National Farm Products Council

To advise the Minister of Agriculture and Agri-Food on all matters relating to the agencies established under the Farm Products Agencies Act, with a view to maintaining and promoting an efficient and competitive agriculture industry:

  • to review the operations of the marketing agencies to ensure they meet their objectives as set out in legislation
  • to work with the agencies in promoting more effective marketing of farm products in inter-provincial and export trade
  • to work with promotion research agencies in connection with primary production research and promotion activities relating to farm products.

2. Summary of significant accounting policies

The financial statements have been prepared in accordance with Treasury Board accounting policies which are consistent with Canadian generally accepted accounting principles for the public sector.

Significant accounting policies are as follows:

  1. Parliamentary appropriations - The Department is financed by the Government of Canada through Parliamentary appropriations. Appropriations provided to the department do not parallel financial reporting according to generally accepted accounting principles since appropriations are primarily based on cash flow requirements. Consequently, items recognized in the statement of operations and the statement of financial position are not necessarily the same as those provided through appropriations from Parliament. Note 3 provides a high-level reconciliation between the bases of reporting.
  2. Consolidation - The accounting entity comprises of the department of Agriculture and Agri-Food, the National Farm Products Council, and the Canadian Pari-Mutual Agency. The accounts of these sub-entities have been consolidated with those of the department and all inter-organizational balances and transactions have been eliminated.  The investment in the Farm Credit Corporation has been recorded at cost and is not consolidated. The financial statements do not include the accounts of the Canadian Food Inspection Agency, the Canadian Wheat Board, the Canadian Grain Commission, the Canadian Dairy Commission and Farm Credit Canada because they are not under the control of Agriculture and Agri-Food Canada and therefore, are not consolidated.
  3. Net Cash Provided by Government - The department operates within the Consolidated Revenue Fund (CRF), which is administered by the Receiver General for Canada. All cash received by the department is deposited to the CRF and all cash disbursements made by the department are paid from the CRF. The net cash provided by Government is the difference between all cash receipts and all cash disbursements including transactions between departments of the federal government.
  4. Change in net position in the Consolidated Revenue Fund is the difference between the net cash provided by Government and appropriations used in a year, excluding the amount of non respendable revenue recorded by the department. It results from timing differences between when a transaction affects appropriations and when it is processed through the CRF.
  5. Revenues:
    1. Revenues from regulatory fees are recognized in the accounts based on the services provided in the year.
    2. Funds received from external parties for specified purposes are recorded upon receipt as deferred revenues. These revenues are recognized in the period in which the related expenses are incurred.
    3. Other revenues are accounted for in the period in which the underlying transaction or event occurred that gave rise to the revenues.
    4. Revenues that have been received but not yet earned are recorded as deferred revenue.
    5. Dividends are recorded as income in the period when they are received.
    6. Refunds prior year expenses are recorded in the period when they are received.
    7. Interest revenue is recognized when earned. Interest revenue ceases to be accrued when the collectibility of either principal or interest is not reasonably collectable
  6. Expenses - Expenses are recorded on the accrual basis:
    1. Grants are recognized in the year in which the conditions for payment are met. In the case of grants which do not form part of an existing program, the expense is recognized when the Government announces a decision to make a non-recurring transfer, provided the enabling legislation or authorization for payment receives parliamentary approval prior to the completion of the financial statements
    2. Contributions are recognized in the year in which the recipient has met the eligibility criteria or fulfilled the terms of a contractual agreement.
    3. Vacation pay and compensatory leave are expensed as the benefits accrue to employees under their respective terms of employment.
    4. Services received without charge from other government departments for accommodation, employer's contribution to the health and dental insurance plans, legal services, and provincial workers compensation plan contributions are recorded as operating expenses at their estimated cost. A corresponding amount is credited directly to the Equity of Canada.
  7. Employee future benefits
    1. Pension benefits - The department's eligible employees participate in the Public Service Pension Plan, a multiemployer plan administered by the Government of Canada. Both the employees and the department contribute to the cost of the Plan. The department's contributions are expensed during the year in which the services are rendered and represent the total pension obligation of the department. The department is not required under present legislation to make contributions with respect to any actuarial deficiencies of the Public Service Pension Plan.
    2. Severance benefits - Eligible employees are entitled to severance benefits, as provided for under labor contracts and conditions of employment. The cost of these benefits is accrued as employees render the services necessary to earn them. These costs are calculated using information derived from the results of the actuarially-determined liability for employee severance benefits for the Government as a whole. Employee severance benefits on cessation of employment represent obligations of the department that are normally funded through parliamentary appropriations when the benefits are paid.
    3. Other future benefit plans - The federal government sponsors a variety of other future benefit plans from which employees and former employees can benefit during or after employment or upon retirement. The Public Service Health Care Plan and the Pensioners' Dental Service Plan represent the two major future benefit plans available to the department's employees.

      The department does not pay for these programs as they fall under the federal government's financial responsibilities, but the department records its share of the annual benefits paid under these programs as a service received without charge from other government departments. No amount is recorded in the department's financial statements with regard to the actuarial liability of these programs at year end nor in the annual increase of such liabilities.

  8. Accounts Receivable - Accounts receivable are stated at amounts expected to be ultimately realized; a provision an allowance is made for receivables where recovery is considered uncertain.
  9. Loans and advances - Loans and advances are recorded at amounts expected to be ultimately realized; an allowance is made where recovery is considered uncertain.
  10. Repayable contributions - Repayable contributions are contributions where the recipient is expected to repay the amount advanced. Depending on their nature, they are classified as either unconditionally repayable or conditionally repayable and are accounted for accordingly.
    The department has conditionally repayable contributions. Conditionally repayable contributions are contributions that, all or part of which become repayable, if conditions specified in the contribution agreement come into effect. Accordingly, they are not recorded on the Statement of Financial Position until such time as the conditions specified in the agreement are satisfied at which time they are then recorded as a receivable and a reduction in transfer payment expenses. An estimated allowance for un-collectibility is recorded where appropriate.
  11. Contingent liabilities - Contingent liabilities are potential liabilities which may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability is accrued and an expense recorded. If the likelihood is not determinable or an amount cannot be reasonably estimated, the contingency is disclosed in the notes to the financial statements.
  12. Loan and Price Guarantees - An allowance on loans or price guarantees is recorded in the accounts when it is likely that a payment will be made to honor a guarantee and where the amount of the anticipated loss can be reasonably estimated. The amount of the allowance for losses is determined based on historical loss experience and economic conditions adversely affecting the capacity of borrowers to reimburse the loan.  The allowance is reviewed on a regular basis and the variations are recorded in the statement of operations.
  13. Environmental liabilities - Environmental liabilities reflect the estimated costs related to the management and remediation of environmentally contaminated sites. Based on management's best estimates, a liability is accrued and an expense recorded when the contamination occurs or when the department becomes aware of the contamination and is obligated, or is likely to be obligated to incur such costs. If the likelihood of the department's obligation to incur these costs is not determinable, or if an amount cannot be reasonably estimated, the costs are disclosed as contingent liabilities in the notes to the financial statements.
  14. Tangible capital assets and leasehold improvements - Tangible capital assets and leasehold improvements having an initial cost of $10,000 or more are recorded at historical cost or management's estimated historical cost less accumulated amortization. Amortization is provided on a straight-line basis over the estimated useful life of the asset as follows:
    Asset class Amortization period
    Buildings 20 to 30 years
    Works and infrastructure 15 to 40 years
    Machinery and equipment 3 to 20 years
    Vehicles 3 to 10 years
    Assets under construction Once in service, in accordance with asset type
    Leasehold improvements Lesser of the remaining term of the lease or useful life of the improvement

    Software and leasehold improvements costs have been performed capitalized prospectively as of since April 1, 2001. Any costs incurred prior to this date previously have been expensed.

  15. Measurement uncertainty - The preparation of these financial statements in accordance with Treasury Board accounting policies, which are consistent with Canadian generally accepted accounting principles for the public sector, requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses reported in the financial statements. At the time of preparation of these statements, management believes the estimates and assumptions to be reasonable. The most significant items where estimates are used are: contingent liabilities, allowance for loan guarantees, environmental liabilities, the liability for employee severance benefits and the useful life of tangible capital assets. Actual results could significantly differ from those estimated. Management's estimates are reviewed periodically and, as adjustments become necessary, they are recorded in the financial statements in the year they become known.

3. Parliamentary appropriations

The Department receives most of its funding through annual Parliamentary appropriations. Items recognized in the Statement of Operations and the Statement of Financial Position in one year may be funded through Parliamentary appropriations in prior, current or future years. Accordingly, the Department has different net results of operations for the year on a government funding basis than on an accrual accounting basis. The differences are reconciled in the following tables:

(a) Reconciliation of net cost of operations to current year appropriations used


    2007   2006
Net cost of operations $ 3,903,382 $ 3,272,690
Adjustments for items affecting net cost of operations but not affecting appropriations
Add (less):
Services received without charge   (57,905)   (48,090)
Crop Re-insurance Fund revenues   65,943   82,731
Refunds of previous years expenditures   521   58,279
Reversal of opening accrued liabilities   47,414   26,183
Revenue not available for spending   26,544   20,738
Cost of Production Benefit program accrual   (400,000)   -
Amortization of tangible capital assets   (37,509)   (36,849)
Expenses related to loan guarantees   (13,691)   (11,992)
Reversal of expenditures related to the Department of Justice   (1,900)   (1,669)
Other   (9,031)   (11,369)
  $ 3,523,768 $ 3,350,652
Adjustments for items not affecting net cost of operations but affecting appropriations
Add :
Acquisitions of tangible capital assets   45,145   29,644
Prepaid expenses and inventory purchased   (1,191)   1,396
Current year appropriations used $ 3,567,722 $ 3,381,692

(b) Appropriations provided and used


    2007   2006
Vote 1-Operating expenditures $ 754,091 $ 653,494
Vote 5-Capital expenditures   51,211   31,194
Vote 10-Transfer payments   832,761   377,677
Statutory amounts   2,232,296   2,433,573
Less:
Appropriations available for future years   3,563   2,693
Lapsed appropriations   299,074   111,553
Current year appropriations used $ 3,567,722 $ 3,381,692

(c) Reconciliation of net cash provided by Government to current year appropriations used


  2007   2006  
Net cash provided by Government $ 3,568,065 $ 4,469,900
Revenue not available for spending   26,544   20,738
Refunds of previous years expenditures   521   58,279
Change in net position in the Consolidated Revenue Fund:
Variation in accounts receivable   (36,500)   (44,910)
Variation in loans and advances   73,440   (29,983)
Variation in an investment in a Crown corporation   -   (15,000)
Variation in accounts payable and accrued liabilities   445,000   (667,252)
Variation in deferred revenue   (5,354)   (2,486)
Variation in other liabilities   (210,801)   (490,089)
Other adjustments1   (293,193)   82,495
    (27,408)   (1,167,225)
Current year appropriations used $ 3,567,722 $ 3,381,692

1Other adjustments reflect the cumulative difference between the changes in assets and liabilities which do not have an impact on either net cash provided by Government or Appropriations Used.

4. Expenses


    2007   2006
Grants and contributions $ 3,066,992 $ 2,544,353
Operating expenses
Salaries and employee benefits   577,484   553,678
Professional and other services   127,216   108,665
Materials and supplies   63,366   48,073
Allowance for loan guarantees   53,210   36,158
Amortization of tangible capital assets   37,509   36,849
Travel   26,721   26,248
Electricity and other public services   18,779   18,642
Repairs and maintenance   16,065   15,529
Accommodation and other   60,917   38,980
    981,267   882,822
Other expenses
Crop Re-insurance Fund   -   5,571
Total expenses $ 4,048,259 $ 3,432,746

5. Revenues


    2007   2006
Crop Re-insurance Fund $ 65,943 $ 88,302
Sale of goods and services   50,082   44,234
Joint projects and cost sharing agreements   10,771   16,908
Dividends and interest - Crown corporations   8,722   7,018
Interest   5,871   2,966
Gain on disposal of assets   2,761   419
Other   727   209
Total revenues  $ 144,877 $ 160,056

6. Accounts receivable


    2007   2006
Receivables from other departments and agencies $ 34,347 $ 29,785
Receivables from external parties   102,621   65,442
    136,968   95,227
Less: Allowance for doubtful accounts on external receivables   (12,500)   (7,259)
Net receivables $ 124,468 $ 87,968

Accounts Receivable from external parties are a result of program overpayments, payments under advance and loan guarantee programs and trade receivables.

7. Loans and advances (Net of allowances)


    2007   2006
Loans resulting from loan guarantee programs $ 115,887 $ 115,976
Less: Allowance   (79,754)   (78,762)
    36,133   37,214
Advances to Crop Re-insurance Fund   498,475   526,095
Loans to Canadian Dairy Commission   45,957   90,696
Loans for construction of exhibition buildings   62   62
Net loans and advances $ 580,627 $ 654,067

Loans resulting from loan guarantee programs

The department's loan receivables are the result of the exercise of loan guarantees by the initial lender under the terms of various loan guarantee programs. These loans are in default with the initial lender and due immediately to the department. Interest rates on these loans vary according to the initial terms of the loans and applicable government regulations. An allowance for doubtful accounts is recorded to reflect the loans at their net realizable value.

Crop Re-insurance Fund

The fund provides funds to participating provincial governments for costs they incur in operating various crop insurance programs. Payments are made only when indemnities exceed accumulated premium reserves due to severe crop losses. The department has advanced $498,475,000 to the fund as at March 31st, 2007 ($526,095,000 in 2006) and owes the equivalent amount to the department of Finance. In fiscal year 2007, the advance was reduced by 27,620,000 (27,620,000 in 2006). The advance to the fund is non-interest bearing and 10% of the principal is repayable annually when the Crop Re-insurance fund account balance exceeds $100,000,000.

Canadian Dairy Commission

The Canadian Dairy Commission is a Crown corporation created in 1966 through the Canadian Dairy Commission Act to provide efficient producers of milk and cream with the opportunity to obtain a fair return for their labour and investment, and to provide consumers of dairy products with a continuous and adequate supply of dairy products of high quality.

The department provides loans to the Canadian Dairy Commission to finance its dealings in dairy products. The total amount authorized to be outstanding at any time is $120,000,000. The loans bear interest that is specified by the department of Finance for Crown corporations range from 3.02% to 4.57% in 2007 (2.58% to 3.91% in 2006). Individual loans are repayable within one year from the date the loan is advanced.

8. Investment in a Crown corporation


    2007   2006
Farm Credit Canada $ 1,208,333 $ 1,208,333
  $ 1,208,333 $ 1,208,333

Farm Credit Canada

Farm Credit Canada exists under the Farm Credit Canada Act, to assist Canadian farmers to establish and develop sound farm enterprises through the use of long term credit. The Government of Canada wholly owns the Corporation.

9. Tangible capital assets


  Cost
    Opening
Balance
  Acquisitions
and adjustments
  Disposals
and write-offs
  Closing
Balance
Land $ 13,017 $ (245) $ - $ 12,772
Buildings   523,853   15,309   661   538,501
Works and infrastructure   34,200   1,944   -   36,144
Machinery and equipment   175,694   17,921   1,399   192,216
Vehicles   49,174   5,929   1,481   53,622
Assets under construction   24,942   2,813   279   27,476
Leasehold improvements   2,563   2,993   -   5,556
  $ 823,443 $ 46,664 $ 3,820 $ 866,287


  Accumulated Amortization
    Opening
Balance
  Amortization   Disposals
and write-offs
  Closing
Balance
Land $ - $ - $ - $ -
Buildings   302,750   21,192   428   323,514
Works and infrastructure   16,753   944   -   17,697
Machinery and equipment   129,926   12,271   1,310   140,887
Vehicles   31,927   3,302   1,321   33,908
Assets under construction   -   -   -   -
Leasehold improvements   1,285   927   -   2,212
  $ 482,641 $ 38,636 $ 3,059 $ 518,218


    Net book value 2007   Net book value 2006
Land $ 12,772 $ 13,017
Buildings   214,987   221,103
Works and infrastructure   18,447   17,447
Machinery and equipment   51,329   45,768
Vehicles   19,714   17,247
Assets under construction   27,476   24,942
Leasehold improvements   3,344   1,278
  $ 348,069 $ 340,802

 

10. Accounts payable and accrued liabilities


    2007   2006
         
Accounts payable and accrued liabilities external to government $ 2,337,899 $ 1,867,064
Due to department of Finance for Crop Re-insurance Fund   498,475   526,095
Due to other departments and agencies   10,429   9,844
Environmental Liabilities   1,780   580
Balance - end of year $ 2,848,583 $ 2,403,583

11. Deferred Revenue

Deferred revenue represents the balance at year-end of unearned revenue stemming mainly from joint collaborative agreements and cost-sharing agreements. Revenue is recognized each year in the amount of the actual costs incurred. Details of the transactions to this account are as follows:


    2007   2006
Balance - beginning of year $ 17,266 $ 19,752
Funds received   5,417   14,422
Revenue recognized   (10,771)   (16,908)
Balance - end of year $ 11,912 $ 17,266

12. Employee future benefits

(a)Pension benefits - The department's employees participate in the Public Service Pension Plan, which is sponsored and administered by the Government of Canada. Pension benefits accrue up to a maximum period of 35 years at a rate of 2 percent per year of pensionable service, times the average of the best five consecutive years of earnings. The benefits are integrated with Canada/Qubec Pension Plans benefits and they are indexed to inflation.

Both the employees and the department contribute to the cost of the Plan. The 2007 expense amounts to $54,980,000 ($57,048,000 in 2006), which represents approximately 2.2 times in 2007 (2.6 times in 2006) the contributions by employees.

The department's responsibility with regard to the Plan is limited to its contributions. Actuarial surpluses or deficiencies are recognized in the financial statements of the Government of Canada, as the Plan's sponsor.

(b) Severance benefits - The department provides severance benefits to its employees based on eligibility, years of service and final salary. These severance benefits are not pre-funded. Benefits will be paid from future appropriations. Information about the severance benefits, measured as at March 31, is as follows:


    2007   2006
Accrued benefit obligation, beginning of year $ 92,316 $ 78,049
Expense for the year   10,633   20,817
Benefits paid during the year   (6,071)   (6,550)
Accrued benefit obligation, end of year $ 96,878 $ 92,316

13. Other liabilities

The department holds funds in trust from the Net Income Stabilization Account program (NISA), from the Canadian Agriculture Income Stabilization program (CAIS) as well as security deposits.

The NISA program was established by section 15 of the Farm Income Protection Act and the Federal/Provincial/Territorial Agreement to help producers improve long term income stability. Participants deposit funds into an account held at a participating financial institutions and receive matching contributions from the federal and provincial/territorial governments. The NISA account balance represents the federal and provincial/territorial contributions to the program. Deposits to the fund funds ended in 2002 when the program was replaced by the CAIS program. NISA participants must withdraw funds at a minimum annual rate of 20% of the remaining balance and over a maximum of five years beginning April 1, 2004 and ending March 31, 2009.

The CAIS program helps producers protect their farming operations against drops in income. Program payments are shared 60% federally and 40% provincially/territorially. The provincial/territorial share of the contributions and interest paid on the contributions are held in a specified purpose account until the producers draw down their funds.

NISA, CAIS and security deposit account activity during the year was as follows:


    2007   2006
Opening balance $ 705,987 $ 1,196,076
Deposits   396,637   347,501
Withdrawals   (607,438)   (837,590)
Ending balance $ 495,186 $ 705,987

14. Contingencies

(a) Contaminated sites

Liabilities are accrued to record the estimated costs related to the management and remediation of contaminated sites where the department is obligated or likely to be obligated to incur such costs. In 2007, the department has identified approximately 82 sites (2 sites in 2006) where such action is possible and for which a liability of $1,779,574 ($580,000 in 2006) has been recorded. The department has estimated additional clean-up costs of $2,233,505 in 2007 ($2,953,000 in 2006) that are not accrued, as these are not considered likely to be incurred at this time. The department's ongoing efforts to assess contaminated sites may result in additional environmental liabilities related to newly identified sites, or changes in the assessments or intended use of existing sites. These liabilities will be accrued by the department in the year in which they become known.

(b) Claims and litigation

Claims have been made against the department in the normal course of operations. Legal proceedings for claims totaling approximately $19,000,000 in 2007 ($25,000,000 in 2006) were still pending on March 31, 2007. Some of these potential liabilities may become actual liabilities when one or more future events occur or fail to occur. To the extent that the future event is likely to occur or fail to occur, and a reasonable estimate of the loss can be made, an estimated liability is accrued and an expense is recorded in the financial statements.

(c) Loans or price guarantees


    Outstanding guarantees Allowance as
at March 31
  Authorized Limit 2007 2006 2007 2006
Loans according to the Advance Payments Program under the Agricultural Marketing Programs Act $5,000,000 $276,386 $684,673 $18,947 $15,784
Loans to farmers under the Farm Improvement Loans Act and Farm Improvement and Marketing Cooperatives Loans Act 3,000,000 140,785 216,537 1,408 2,165
Price guarantee agreements with marketing agencies pursuant to the Price Pooling Program under the Agricultural Marketing Programs Act No limit 27,249 29,563 Nil Nil
Loans under the Spring Credit Advance Program 1,500,000 748 2,892 Nil Nil
Loans under the Enhanced Spring Credit Advance Program 1,500,000 604,432 Nil 7,979 Nil
  $11,000,000 $1,049,600 $933,665 $28,334 $17,949

The allowance for losses is the amount recorded for estimated losses on outstanding loan guarantees. No allowance has been recorded for the Spring Credit Advance Program and the Price Pooling Program of the Agricultural Marketing Programs Act as no costs are likely to occur.

Under the Advance Payments Program of Agricultural Marketing Programs Act and Spring Credit Advance Program, the department guarantees the repayment of advances made by producer organizations to farmers in the spring and in the fall, respectively, creating a more stable business environment. In 2006, the Spring Credit Advance Program and the Advance Payment Program have been merged into a single program which is the new Advance Payment Program. The maximum cash advance of the new Advance Payment Program is $400,000. The loans have now a repayment term of no more than 18 months.

Under the Price Pooling Program of the Agricultural Marketing Programs Act, the department provides a price guarantee that protects marketing agencies and producers against unanticipated declines in the market price of their products.

Under the Farm Improvement Loans Act and Farm Improvement and Marketing Co-operatives Loans Act, the department guarantees loans by financial institutions to farmers for improvement and development of farms, and the processing, distribution or marketing of farm products. This program guarantees 95 percent of the value of loans provided to farms and co-operatives by financial institutions. For individual applicants, including corporations, the maximum amount for a Farm Improvement and Marketing Co-operatives Loans Act loan is $250,000. The loans are repayable in full within fifteen years.

Under the Enhanced Spring Credit Advance Program of the Agricultural Marketing Programs Act, the department helps producers manage the cash crunch of planting a spring crop by providing loan guarantees that facilitate access to short-term credit. The maximum principal guarantee per individual producer or farm unit cannot exceed $100,000. The loans are repayable on or before September 30th of the crop year.

(d) Conditionally Repayable Contributions

Under the Ruminant Slaughter Loan Loss Reserve Program, conditionally repayable contributions are provided to capital providers as loans are disbursed to the slaughter house. In 2007, $10,067,000 ($14,853,000 in 2006) has been paid. The maximum authorized limit for this program is $41,000,000. The funds contributed and accumulated interest are repayable within 10 years and no later than December 31, 2017, net of the amounts used to cover a portion of the loan defaults. The amounts repayable cannot be currently estimated. The contributions bear interest rates either at the cost of capital of the lender or at the Government of Canada 90-day bond rate, as per initial agreements with the lender.

(e) Contingent Recoveries

CAIS is a federal and provincial/territorial cost shared program at the rates of 60 percent and 40 percent, respectively. Four provinces (Alberta, Ontario, Quebec and PEI) deliver the program in their province. Some participants of the CAIS program in the four provinces have been overpaid and the provinces have established outstanding accounts receivable. The federal government is entitled to 60 percent of the collection when the overpayments are recovered. The department has estimated the contingent recoverable amount as $26,500,000. Contingent recoveries are not recorded in the financial statements.

15. Contractual obligations

The nature of the Department's activities can result in some large multi-year contracts and obligations whereby the Department will be obligated to make future payments. Significant contractual obligations that can be reasonably estimated are summarized as follows:


    2008   2009   2010   2011   2012
and thereafter
  Total
Transfer payments $ 10,000 $ 10,000 $ 10,000 $ 10,000 $ 4,991 $ 44,991
  $ 10,000 $ 10,000 $ 10,000 $ 10,000 $ 4,991 $ 44,991

16. Related party transactions

The department is related as a result of common ownership to all Government of Canada departments, agencies, and Crown corporations. The department enters into transactions with these entities in the normal course of business and on normal trade terms. Also, during the year, the department received services which were obtained without charge from other Government departments.

Services received without charge

During the year the department received without charge from other departments, accommodation, employer's contribution to the health and dental insurance plans, legal fees and provincial workers compensation plan contributions. These services without charge have been recognized in the department's Statement of Operations as follows:


    2007   2006
Employer's contribution to the health and dental insurance plans $ 34,925 $ 31,727
Accommodation   19,666   13,140
Provincial workers compensation plan contributions   1,731   1,843
Legal services   1,583   1,380
  $ 57,905 $ 48,090

The Government has structured some of its administrative activities for efficiency and cost-effectiveness purposes so that one department performs these on behalf of all without charge.  The costs of these services, which include payroll and cheque issuance services provided by Public Works and Government Services Canada, are not included as an expense in the department's Statement of Operations. 

17. Equity of Canada

The Department operates two programs which under legislation require that the revenues be earmarked to offset the expenses of the program.


    2007   2006
Restricted equity
Crop Re-insurance Fund $ (472,878) $ (406,935)
Agricultural Commodities Stabilization Accounts   647   658
    (472,231)   (406,277)
Unrestricted equity   (768,078)   (556,620)
Equity of Canada $ (1,240,309) $ (962,897)

(a) Crop Re-insurance Fund: Under the Farm Income Protection Act, this program provides insurance to participating provinces for costs they incur in operating various crop insurance schemes. The fund records receipts and disbursements under the terms of reinsurance agreements. When there is insufficient revenues to meet payments, the Minister of Finance may authorize an advance of additional funds to cover these obligations (Note 7).

(b) Agricultural Commodities Stabilization Accounts: 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. 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. Current activities are limited to collection of accounts receivable.

The department includes in its revenues and expenses transactions for the Crop Re-insurance Fund and for the Agricultural Commodities Stabilization Account. The Farm Income Protection Act and the Agricultural Stabilization Act requires that the net balances in these accounts be segregated from the Consolidated Revenue Fund.


  Crop Re-insurance Fund Agricultural Commodities
Stabilization Account
Opening balance, April 1, 2006 $ (406,935) $ 658
Revenues   (65,943)   (11)
Expenses       -
Ending balance, March 31, 2007 $ (472,878) $ 647

18. Comparative information

Comparative figures have been reclassified to conform to the current year's presentation



AAFC's Horizontal Initiatives

The objective of reporting on horizontal initiatives is to provide Parliament, the public and government with an overall picture of public spending and results achieved by departments working together.

A horizontal initiative is an initiative in which partners, from two or more organizations, have agreed under a formal funding agreement (e.g. Memorandum to Cabinet, Treasury Board Submission, federal-provincial agreement) to work toward the achievement of shared outcomes.

Horizontal initiatives reported here are led by AAFC and have been either allocated federal funds that exceed $100 million (counting all federal partners) for the duration of the program or allocated less than $100 million but are still considered key for the achievement of government priorities or have a high public profile.

Followin gis a summary list of horizontal initiatives for 2006-07. More complete information on each initiative, including expenditures by our federal partners, is available on Treasury Board's Horizontal Results Database Horizontal Results Database

Horizontal Initiative Information for 2006-07

  1. Production Insurance
  2. Canadian Agricultural Income Stabilization program
  3. Bovine Spongiform Encephalopathy (BSE) Recovery Program (federal/provincial agreement)
  4. Farm Business Services
  5. Canadian Agricultural Skills Service
  6. MOU with Health Canada (HC) on Food Safety and Quality and Environment
  7. MOU with Canadian Food Inspection Agency on Food Safety and Quality
  8. AAFC– Department of Foreign Affairs and International Trade MOU on Agri-Food Specialists
  9. MOU with Environment Canada on the National
    Agri-Environmental Standards Initiative
  10. Rural Development
  11. Co-operatives Secretariat

Key Government-wide Themes

Sustainable Development Strategy (SDS) Sustainable Development Strategy (SDS)

Sustainable development integrates environmental, economic, and social considerations in ways that allow today's needs to be met without compromising the ability of future generations to meet their own needs. In the context of Canadian agriculture and agri-food production, sustainable development means producing, processing, and distributing agricultural products in a manner that supports or enhances the high quality of life we enjoy in Canada, both today and into the future.

A key driver in improving AAFC's understanding and practice of sustainable development in recent years has been the APF. The APF has been integrative by nature, guiding AAFC's efforts to support the economic viability of the agriculture and agri-food sector while enhancing its environmental performance and benefits to society. The APF established principles for taking sustainable action in five priority areas - food safety and quality, business risk management, environment, science and innovation, and renewal. Integrative initiatives exist in each of the five priority areas of the APF, as well as areas such as markets and international.

Having reliable and objective information on how well agriculture and agri-food systems are performing is important in evaluating sustainability in the sector. AAFC is continuing to develop agri-environmental indicators (AEIs) to measure key environmental conditions or risks resulting from agriculture. Through programs such as the Environmental Farm Planning Program, National Farm Stewardship Program and Greencover Canada, AAFC is continuing to work with its partners to accelerate the adoption of improved land-use and management practices to further increase the environmental performance of the sector and reduce risks. The department is also continuing the development of economic-environmental modelling and agri-environmental valuation as tools for better integrating these indicators into policy development and assessing the impact of changes in agricultural policies and programs on future environmental and economic outcomes of the sector.

AAFC's third sustainable development strategy (SDS III), Sustainable Agriculture: Our Path Forward, which was released in February 2004, identified a number of deliverables for each of the five elements of the APF. Logic models were used to clearly link the department's strategic outcomes, departmental program activities, end outcomes, targets, immediate/intermediate outcomes, deliverables and activities. The department's achievements for each element of the APF in relation to the deliverables set out in SDS III are outlined in Appendix B of AAFC';s fourth sustainable development strategy (SDS IV) Making Progress Together, which was tabled in December 2006.

The theme of SDS IV, covering the period from 2007 to 2009, is the enhanced integration of the three pillars of sustainable development - environmental, economic and social. This strategy highlights the ongoing implementation of the Agricultural Policy Framework towards sustainable agriculture in Canada. Much of the work will involve collaboration with other federal departments, provincial and territorial governments, and other stakeholders as the next generation of Canadian Agriculture and Agri-Food policy is developed.

SDS III and SDS IV, covering the periods from 2004-2006 and 2007-2009 respectively, can be viewed at: http://www.agr.gc.ca/sds-sdd/sds-sdd_e.phtml.

Greening AAFC's Operations

In addition to promoting sustainable economic, social and environmental development in the agriculture and agri-food sector, AAFC is determined to set a good example in its own operations by the design and implementation of programs which reduce our reliance on natural resources (our ecological footprint) and limit damage to the environment.

SDS III included a large number of commitments and although not all targets were met, significant progress was made in all areas. In areas where targets were not met, work will continue until complete, unless circumstances dictate a change in direction or approach. During the three-year period covered under SDS III (2004-2006), our environmental scan identified new issues that needed managing. This necessitated a change in focus for instance to a higher emphasis on water quality assurance and added an emphasis on management of Species at Risk issues on research properties, building on the extensive work already undertaken on community pastures in the prairies.

AAFC's fourth sustainable development strategy, Making Progress Together was tabled in Parliament in December 2006. It addresses recommendations of the Office of the Commissioner of the Environment for Strategies to include fewer, more meaningful and more measureable commitments. An internal risk assessment identified seven high priority areas: contaminated sites management, halocarbon management, species at risk, water quality management, green procurement, building energy efficiency and green fleet. Specific targets were developed for each of these areas. At the same time, we are committed to continuing work towards meeting the commitments of SDS III where this work has not already been completed.

A complete report on progress against SDS III targets, lessons learned and direction for 2007-09 can be found in SDS IV: Making Progress Together , Chapter 5 and Annex.

Audits and Evaluations

Office of the Auditor General (OAG)

In 2006, the OAG tabled two reports in the House of Commons - one in May, the other in November.

The May report included one chapter which implicated Agriculture and Agri-Food Canada (AAFC) - Chapter 1, Managing Government: Financial Information. The Auditor General observed AAFC had made satisfactory progress on addressing a previous recommendation on security controls in computer information system that was related to internal financial controls.

The November report included 12 chapters, two of which refer to AAFC. Chapter 2, The Expenditure Management System (EMS) in Departments stated departments needed to build up capacity for reallocation requests from the centre of government. AAFC was credited for establishing a baseline for tracking expenditures to source funds at the start of fiscal year 2006-07.

Chapter 3, Large Information Technology Projects, was an examination of the guidance offered by Treasury Board (TB) policies. Seven large information technology projects from across government were used to determine if selected key processes and best practices were followed. In this report, AAFC was credited for its decision to discontinue the Agconnex Project and redirect resources to smaller, low risk projects.

Both reports can be found in detail on the Auditor General's website:

OAG 2006 Annual Monitoring Exercise

2001 - A Legacy Worth Protecting: Charting a Sustainable Course in the Great Lakes and St. Lawrence River basin
2002 - The Legacy of Federal Contaminated Sites
2003 - Managing The Safety and the Accessibility of Pesticides
2004 - Assessing the Environmental Impact of Policies, Plans, and Programs
2005 - Environmental Impact of Hog Farming - CESD

Commissioner of the Environment and Sustainable Development (CESD)

In September 2006, the CESD tabled a report in the House of Commons. The report included five chapters, three of which implicated AAFC. Chapter 2, Adapting to the Impacts of Climate Change, found AAFC had not yet developed its own strategy to adapt to climate change. Chapter 4 examined Sustainable Development Strategies. In this chapter, AAFC received an unsatisfactory rating regarding a commitment made in 2001. In Chapter 5, Environmental petitions, AAFC is mentioned as having responded to three petitions.

The CESD report can be found on the Auditor General's website.

Internal Audit and Evaluations

Audit/Evaluation URL
Audit of Transitional Industry Support Program (TISP) Payments Component 2 http://www.agr.gc.ca/info/audit-exam/index_e.php?page=tisp_pati
Audit of Non-Executive Staffing without Competition http://www.agr.gc.ca/info/audit-exam/index_e.php?page=non_ex
Audit of Management Practices - Extra Duty Pay http://www.agr.gc.ca/info/audit-exam/index_e.php?page=ex_dut
Review of IST Acquisition Card Practices http://www.agr.gc.ca/info/audit-exam/index_e.php?page=ist_esi
Audit of Management of Fed/Provincial Agreements for the delivery of BSE (1) Initiated in FY 2006-2007 and will be completed in FY 2007-2008.
Audit of Management and Environmental Programs (EFP/NFSP/Greencover)(1) The name has been changed to Management Control Framework - Environmental Programs and was initiated in FY 2006-2007 and will be completed in FY 2007-2008.
Evaluation of Prairie Grain Roads (1) http://www.agr.gc.ca/info/audit-exam/index_e.php?page=pgrp_prtgp
Evaluation of Production Insurance (1) Initiated in FY 2006-2007 and will be completed in FY 2007-2008.
Evaluation of AAFC Response to BSE (1) Initiated in FY 2006-2007 and will be completed in FY 2007-2008.

(1) Identified in the 2006-2007 Report on Plans and Priorities to be completed in FY 2006-2007.

Parliamentary Committee Reports

Report of the Standing Committee on Agriculture and Agri-Food (April 2006-March 2007)

On December 5, 2006, the Standing Committee on Agriculture and Agri-food tabled their 5th report entitled Report on the Review of the Canada Grain Act and the Canadian Grain Commission Conducted by COMPAS Inc. This report was prepared following a series of meetings with Canadian agricultural stakeholders that were held in the fall of 2006.

This report was prepared after the Minister of Agriculture asked the Standing Committee on Agriculture and Agri-Food “to study the review and its 102 recommendations.” It offered an overview of the strong and general support for CGC reform focusing on the CGC mandate, governance, inspection activities, the government funding, liability of the CGC, kernal visual distinguishability (KVD), and research and development. The full report is available at: http://cmte.parl.gc.ca/cmte/CommitteePublication.aspx?COM=10464&Lang=1&SourceId=185696.

The Government of Canada studied the recommendations carefully and the Minister tabled a response to the report in April 2007. The response is available at: http://www.agr.gc.ca/index_e.php?s1=info&s2=consult&s3=cgc-ccg&page=summ-res-07

Reports of the Standing Senate Committee on Agriculture and Forestry

Agriculture and Agri-Food Policy in Canada: Putting Farmers First

In June 2006, the Standing Senate Committee on Agriculture and Forestry tabled an interim report titled Agriculture and Agri-Food Policy in Canada: Putting Farmers First. This report was prepared following a series of meetings with Canadian agricultural stakeholders that were held in the spring of 2006.

The report offered a brief overview of the ever-growing farm income crisis and decreasing commodity prices, and also highlighted some of the government's commitments to agriculture that were contained in Budget 2006.

The report contained two recommendations to the Government, stressing that there is a viable future in farming in Canada if appropriate programs and policies are implemented. The full report of the committee can be found here: http://www.parl.gc.ca/39/1/parlbus/commbus/senate/com-e/agri-e/rep-e/repintjun06-e.htm.

The Minister of Agriculture and Agri-Food responded to the Committee's report by letter in September 2006. In his response, the minister provided an update on government actions since his appearance before the Committee (June 12, 2006), with details following the 2006 annual federal-provincial-territorial ministers meeting. He noted that the Government of Canada is committed to working with provincial and territorial counterparts and the agriculture and agri-food sector to ensure business risk management programming provides producers with tools they require to effectively manage their operations.

Recognizing that the Agricultural Policy Framework will be coming to an end in 2008, the minister highlighted efforts made by the department to lay the groundwork for an extensive consultation process to be held with all involved stakeholders as the next generation of policy is being developed.

Understanding Freefall: The Challenge of the Rural Poor

In December 2006, the Committee tabled an interim report titled Understanding Freefall: The Challenge of the Rural Poor. This interim report represented the culmination of the Committee's meetings held in the fall of 2006 under its order of reference to examine and report on rural poverty in Canada.

The Committee heard from a number of government officials, academics, and community groups, and as such its examination of policy options to assist the rural poor was wide-ranging, extending beyond strictly agricultural issues to the broader rural economy and services available to rural residents. The report discussed potential directions for rural economic development and income policies, as well as issues such as access to education, transportation, tourism, and immigration.

No recommendations to the Government were made in the interim report, and no response from the Minister of Agriculture and Agri-Food was issued. The Committee has continued to meet in Ottawa with rural stakeholders and has also traveled extensively across Canada to consult directly with stakeholders. A final report on rural poverty in Canada is scheduled to be tabled in December 2007.

The full interim report on rural poverty is available at the following website: http://www.parl.gc.ca/39/1/parlbus/commbus/senate/com-e/agri-e/rep-e/repintdec06-e.pdf.

Statutory Annual Reports

The information included in Sections 2 and 3 of this DPR meets the Statutory Annual Reporting requirements for the department for 2006-07.