Module 4

Question 0

What does affordability of services mean?

Answer 0

Affordability refers to whether the government (or economy) is sufficiently well off to afford a particular service. Affordability depends on a nation’s GDP and the relative cost of the service, similar to the household decision model in economics, where relative prices and budget constraint determine the choice set. Since the size of the government is a reflection of the size of the nation’s or province’s economy, the economy can be used as the budget constraint.

Question 1

The following is the financial structure of the Federal Government.
Discuss briefly the roles of each entity.
1. Parliament

Answer 1

1. Parliament

Question 2

List the eight steps in the financial management cycle of the public sector.

Answer 2

1. Goal setting
2. Evaluate alternatives
3. Assessing adequacy of long-term resources
4. Obtaining and allocating organizational resources
5. Establishing standards
6. Managing costs
7. Creating relevant management and financial information
8. Measuring and reporting on performance.

Question 3

Exam questions

- List special features of Government Decisions

Answer 3

1. Public goods are difficult to sell and even where sales may be feasible, non-revenue concern may be as important as the cash collected.
2. Public and private resource constraints differ significantly.
3. Governments characteristically operate as perfect monopolies. No competition exists with regard to the provision of services.
4. Government operate with mixed motives.
5. Budgeting process is a direct result of political processes.

Question 4

What functions can the public sector budget have?

Answer 4

1. The public sector budget provides an opportunity for discussion and input on strategic priorities (primarily through the pre-budget consultation process)
2. Addresses such questions as: what services are required and desired by the public and what options are available for providing them?
3. The budget provides an expenditure control function through cost management.
4. Require relevant management and financial information to ensure compliance with authorized categories and expenditure levels.
5. They promote efficiency when they are used to measure and report on performance.

Question 6

What are the Estimates?

Answer 6

Estimates documents specify spending plans in greater detail.
Main and supplementary estimates are budget documents prepared for a government’s legislative body to support appropriation bills. 정부의 입법부 기관의 세출 예산 법을 지원하기 위해 만들어진 예산 문서 The Main Estimates are the first such documents for a fiscal year and will normally contain the bulk of a government’s spending. 정부의 지출 대부분에 대해 만들어진 첫 예산 문서 Supplementary estimates are prepared later on during the fiscal year to address events that were unforeseen when the initial budget was prepared.

Question 7

Explain the Budget and who prepares for it?

Answer 7

The Budget, prepared by the Minister of Finance, which outlines the government’s revenue projections and spending obligations.

Question 8

Explain public accounts of Canada.

Answer 8

Public accounts of Canada which provide audited financial statements and represent the major accountability report of the Government of Canada.

Question 9

Roles of the Privy Council Office

Answer 9

• an advisory council to the Prime Minister, Cabinet and policy committees of Cabinet
• focus on overall government and prime ministerial priorities and the integrity and functioning of the system
• provide support to Cabinet and its committees and coordinate Cabinet review of Budget Consultation Papers and strategies
• advise the Prime Minister, Cabinet and policy committees of Cabinet on specific proposals in the Budget and Budget Consultation Papers.

Question 10

The Minister of Finance, assisted by the Department of Finance will

Answer 10

• set the fiscal framework
• focus primarily on the economic outlook, macro-economic management, and tax and fiscal policy
• ensure that decisions on the macro-allocation of resources are compatible with the government’s economic and fiscal policies
• prepare the Budget Consultation Papers and the Budget documents, a process which includes updating the economic outlook and fiscal plan and recommending fiscal targets and
• focus on expenditure management at the macro level with the primary emphasis on major statutory expenditures, debt management, the financial policy framework, and guidelines for loan and guarantee programs and Crown corporation borrowings.