Memorandum to Cabinet and Treasury Board Submission – Why

they are Major Tools for Government

Presented by: Samantha Tattersall

Executive Director, Economic SectorTreasury Board Secretariat

May 2014

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To provide an understanding of the decision making process in the Federal Government:

• The Role of Memorandum to Cabinet and TB Submissions, – including differences between them

• The new TB Submission template and guidance:

Key considerations while drafting

The process to get to a TB Meeting

Tips for Success

Overview

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Three of the key approvals typically needed to put in place a new initiative/program:• Funding approval:

Typically happens through the Budget process (unless there is an “off Budget decision”)

Finance Canada leads the process - new advisory role for TBS

• Policy approval: Memorandum to Cabinet PCO leads the process but both Finance and TBS involved

• Program approval: Treasury Board Submission Treasury Board Secretariat leads the process

Decision making process

Cabinet Approval (MC)

Treasury Board Approval (TB Submission)

Parliamentary Approval (Actual $$

Flow to Organization)

Minister seeks Cabinet approval of a policy or new initiative through an MC which explains the new initiative and proposes options.

If approved, Minister now has policy authority, but Minister still cannot proceed – Minister needs program approval as well ( e.g. “terms and conditions”)

MC’s approve an idea

Once Minister has policy authority AND a source of funds, Minister seeks program authority from TB through a TB Submission. In this Submission, Minister provides concrete details on program objectives, outcomes, detailed delivery model, outcomes, value for money, and all applicable TB policies.TB Submissions are far more detailed than MCs

TB Subs approve detailed program parameters.

Once approved by TB, organization has authority to proceed, but the funding cannot flow to an organization until Parliament grants its approval of the Estimates by passing the related Appropriation Bill (i.e., Main Estimates and Supplementary Estimates). Many departments `’risk manage`’ this process.

Parliament approves expenditure authority.

How a Federal Organization Gets Funding for

a New Initiative

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Cabinet ApprovalMemorandum to Cabinet (MC)

As the MC occurs earlier in the overall process, the level of information included in an MC is sometimes of a more general nature with a focus on the policy rationale

(`why do we need this’?)

Detailed information about the delivery of a new initiative is provided later to Treasury Board through a TB Submission when the organization has a business case

that outlines program design and an implementation plan (‘how are we going to do this?’).

• The MC’s main purpose is to seek approval of a new initiative. Often referred to as “policy approval”, Cabinet approval generally gives a government organization permission to continue to explore the possibility of implementing a “new idea”.

• MCs can be written for several different reasons, including when: A federal organization proposes a new program or policy that is consistent with the

government’s priorities, such as initiatives that stem from the Speech from the Throne;

An organization requires additional funds in order to meet legislative or regulatory requirements;

New issues arise that demand action by an organization on behalf of the government; or;

The Prime Minister or a Minister wishes to bring forward a new policy or to respond to a past Cabinet commitment outside of the Budget.

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Treasury Board ApprovalTB Submission

• The TB Submission’s main purpose is to seek program authority from Treasury Board ministers to carry out a new initiative which has already received Cabinet approval and a source of funds

• TB Submissions can also be written for different reasons, including when an organization requires:

authority to carry out a project or initiative, the costs of which would exceed a minister's delegated authority;

authority to make grants or contributions, or approval of amendments to terms and conditions of grant and contribution programs;

recommendations of approval of orders in council with resource or management implications; authority to enter into a contract above or outside a federal organization's or minister's authority; or an exemption from a Treasury Board policy.

A Submission is an official document submitted by a sponsoring minister on behalf of a federal organization seeking approval or authority from the

Treasury Board for an initiative that the organization would not otherwise be able to undertake or that is outside its delegated authorities.

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MCs and TB Submissions inform Government decision-making by

different means

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Memorandum to Cabinet TB Submission

Purpose To seek approval of a policy or new initiativeTo seek approval of elements for a program's design, delivery and implementation

Focus Policy rationale, with a clear outline of policy objectives; proposal for implementation

Detailed program design and implementation plan; detailed costing; results measurement and accountability frameworks; opportunities for reallocation.

Resource details

General funding information, with total amount of resources by year which includes implementation costs (cash and accrual basis)

Specific funding details and a clear rationale for what resources will be spent each year, including specific FTEs

Target audience Policy Committees, Cabinet ministers (presented by sponsoring Minister(s))

Treasury Board Ministers (presented by TBS Program Sector Assistant Secretary)

Key federal organizations involved

Organization(s) sponsoring the MC, PCO, Finance, TBS and other interested federal organizations

Organization(s) sponsoring the submission (in the case of a Crown corporation, the corporation itself and the portfolio department) and TBS

Recommendation/Approval

Ministerial Recommendation (MR) approved, approved-in-principle, postponed or not approved by policy committee. Approval must be ratified by Cabinet or Priorities and Planning

TBS prepares recommendations, TB makes the final decision to approve, approve with conditions or defer (can differ from TBS recommendations)

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Crosswalk Between Cabinet Documents

Memorandum to Cabinet Treasury Board Submission Ministerial Recommendations Title and SynopsisIssue Authorities Sought from the Treasury BoardRecommendations BackgroundRationale RationaleProposed Approach and Options Expected OutcomesConsiderations Risks and Risk Responses Due Diligence Cost and Source of Funds

Costing Due Diligence and Validation Contact

Annexes AppendicesAnnex X to the MR: Implementation Plan Appendix A: Financial appendicesAnnex Y to the MR: Strategic Communications Plan

Appendix B: Existing Statutory and Policy Authorities

Annex Z to the MR: Parliamentary Plan Appendix C: Program Alignment and Performance MeasurementAppendix D: Audit and EvaluationAppendix E: Government-Wide Policy Consideration (Environmental concerns, Gender-Based Analysis, Official Languages)

The MC and TB Submission templates include the following information:

• Title and Synopsis• Authority Sought from TB• Background• Rationale• Design, Delivery and

Implementation*• Expected Outcomes *• Risk(s) and Risk Responses *• Cost, Funding Requirements and

Source of Funds *• Costing Due Diligence and

Validation* • Contact

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Information is presented in a way that tells a more coherent, easy to follow story about proposals contained in a submission

* New headers or sections

New Treasury Board Template- Modernizing to Meet Government Priorities -

New Treasury Board Template- Modernizing to Meet Government Priorities -

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Old Form New Form Section Title Section Title Location on New Form Subject Title and Synopsis Body of Submission Authority Existing Statutory and Policy Authorities Appendices Proposal Authorities Sought from the Treasury Board Body of Submission Cost and Source of Funds Cost and Source of Funds Body of Submission Official Languages Mandatory Appendices (OL, GBA and

Environmental Concerns) Appendices

Audit and Evaluation Audit and Evaluation Appendices Appendices Remarks Background*

Body of Submission

Rationale* Expected Outcomes* Risks and Risk Responses* Costing Due Diligence and Validation* Program Alignment and Performance Measurement Appendices*

Appendices

Departmental Contact Contact Body of Submission

* New Section

Key Considerations for Drafting TB Submissions

• The new TB Submission template helps provide a clearer and more coherent story to explain the proposed initiative to Ministers

• New series of practical questions that each organization should take into consideration when drafting TB Submissions

• The questions are reflective of current TB Minister interests, and can change over time as priorities change

• Key Consideration Guidance is aligned per section of new template:

Authorities Sought From the Treasury Board Background Rationale Expected Outcomes Risks and Risk Responses Cost and Source of Funds Costing Due Diligence and Validation

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12http://www.tbs-sct.gc.ca/tbs-pct/dgw-ddir/tps-opp-eng.asp

Key Considerations Excerpt : Background

• What is the context for your proposal?

• How is the proposal linked to your organization’s mandate?

• What is the history of the proposal or program? How long has it existed? What has its budget been historically?

• Have there been any previous Cabinet or Treasury Board decisions related to the proposal?

• Have there been any relevant public announcements related to the proposal?

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Key Considerations Excerpt : Rationale

• Why is the proposed course of action needed? What problem is being solved by the authorities that are being sought? How does the proposal support or link to government priorities? Is this a legitimate and necessary role for the federal government?

• What is the relevant policy and expenditure context? Is this a new initiative, or the renewal of an existing program? What were

the previous results achieved? Was the proposed course of action developed as a result of a gap analysis? What comparative benchmarks have been used to gauge the

reasonableness of this proposal?

• How does the proposal align with your organization’s existing programs and program activity architecture (PAA)? Has your organization demonstrated a clear gap in its suite of programs and

policies or in the relevant PAA s of other government organizations, for horizontal activities?

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Key Considerations Excerpt : Expected Outcomes

• What are the expected outcomes?

• How will you measure success?

• Do your outcomes align with your organizational mandate?

• Are your delivery strategies aligned with your policy objectives?

• What are your plans for audit and evaluation?

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Key Considerations Excerpt : Risks and Risk Responses

• How complex is your proposal?

• Does your organization have the capacity to deliver the initiative?

• Does the history of the issue indicate any risks?

• What are the financial risks?

• How will your organization respond to and monitor risks?

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Key Considerations Excerpt : Cost and Source of Funds

• Has your organization considered every aspect of each proposal’s cost and source of funds?

Have you examined cheaper delivery alternatives?

Have you explored cost-recovery options?

Is there a risk of costs exceeding estimates that could lead to unfunded costs and program integrity concerns in the future?

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Key Considerations Excerpt : Costing Due Diligence and

Validation• How do costs align with the government’s priority to reduce spending?

Is this proposal related to previous DRAP or SR decisions? Does it recreate previously cut or reduced programs?

What efforts were made to keep costs down? Is it affordable in the current fiscal context?

• How are costs contained? Are the requested financial resources adequate to deliver the program? Is there sufficient rationale for ongoing resources? What efforts has your organization made to minimize operating costs?

• Has your organization demonstrated due diligence? Is the methodology that was used to prepare the cost estimates in line with

the TB Guide to Costing? Are there comparable national or international initiatives?

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Key players in the process of Drafting a TB Submission

• In your client department: Program area(s) originating the submission Departmental corporate / finance group Other key branches in in your department (legal, audit, evaluation etc) Deputy Minister Minister

• At Treasury Board Secretariat: Program Sector analyst assigned to client department – primary point

of entry Policy centre analyst(s) – experts in subject areas Assistant Secretaries who will present to Treasury Board

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TB Submission Approval Process:90% lies below the surface

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Draft submission

TBS AnalystDepartment

The Tip of the Iceberg

Comments

New Service Standards - within 5 working days of receiving a draft TB submission, the Secretariat will assess the overall quality. Within 10 working days of confirming that the due diligence review will proceed, the Secretariat will provide substantive comments on the draft TB submission.

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TB Submission Process

Policy Areas

TBS Analyst

Draft submission Draft submission

Department(through Corporate Services – Finance)

Analyst shares comments with Dept.

Précis drafted by analyst

Final draft of submissionSubmitted to TBS

Revised Drafts

New Draft Prepared

Analyst ReviewsDraft

The collaboration between departments and TBS will continue until the TBS analyst has ensured that all issues involving the submission are addressed. This step will determine the length of time required to approve the submission.

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Final Signed Submission due to

TBS

Secretary Reviews Submissions and Précis

with other Assistant Secretaries and the

Secretary of TB

TB Submission Process

Final Precis

Assistant Secretary Reviews Submission and

Précis with Analyst

President’sBriefing

3.5 wks priorto TB

2 wks priorto TB

1.5 wks priorto TB

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What happens at the Meeting ?

• TBS officials brief TB Ministers

• Ministers have four options for decisions:Approve as proposedApprove with conditionsNot approveDefer decision

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Tips for Success• Engage early and regularly with TBS:

Regular meetings forge a strong working relationship Engagement helps identify issues early on so we can work towards

solutions Ongoing communications during the process is essential for

effective management of departmental business

• A long submission is not necessarily a good submission – always ask, what is the storyline?

• Remember the audience (TB Ministers) Don’t focus on technical details (or use language that is overly

technical), be strategic about what information to include Anticipate what questions TB Ministers may have

• Expect the process to take approximately 3 months (if not more) & plan accordingly

• Your TBS analyst will both challenge and defend your case; help us, help you – by providing information in a timely way 25

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Questions

Samantha.tattersall@tbs-sct.gc.ca