To ensure that appropriate financial and operational
management controls are applied to the decision process in
spending public money and that they contribute to the
effectiveness of program delivery and to the accountability of
the authority process.
It is government policy to entrust its ministers and deputy
heads with the responsibility to delegate financial and
operational authority to managers in order to enable them to
administer programs under their jurisdiction.
This policy applies to all organizations considered to be
departments within the meaning of section 2 of the Financial
Administration Act (FAA).
1. Ministers and deputy heads must formally delegate and
communicate financial authorities in writing and establish an
appropriate division of responsibilities in order to ensure that
controls are applied in spending public money. Whether the
minister or the deputy head or both must so delegate will depend
on the statute requiring the delegation.
2. Departments must establish policies and procedures that
will ensure an adequate level of control over delegated
authorities and that persons with delegated authorities are well
informed of their responsibilities in this regard.
3. No person shall be permitted to exercise authorities unless
the minister or the deputy minister have formally delegated these
authorities and the officer to whom the incumbent of the position
reports has formally designated the person.
4. The process must ensure that the signatures of persons
authorized to exercise authorities can be authenticated before or
after the processing of the transaction.
5. Authorities must be delegated to positions identified by
title, not to individuals identified by name.
6. Persons properly designated to exercise authorities shall
not delegate these authorities.
1. Departments must review and update all delegated
authorities, including electronic delegation matrixes, specimen
signature documents and validation and authentication processes
in use in departments and in offices of the Department of Public
Works and Government Services at least annually.
2. Ministers and deputy heads must carry out control measures
periodically to prevent the improper use of the authorities they
have delegated to their subordinates.
3. In assigning responsibility to individuals involved in the
expenditure process, a deputy head must ensure that the following
functions are kept separate:
- procurement;
- certification of the receipt of goods and the provision of
services;
- determination of entitlement, verification of accounts, and
preparation of requisitions for payment or settlement; and
- certification of requisitions for payment or settlement
pursuant to section 33 of the Financial Administration
Act.
Should the process or other circumstances not allow such
separations of duties, alternate control measures must be
implemented (e.g. acquisition cards and other governmental credit
cards).
4. Though appointment of a new minister does not automatically
nullify existing delegations of authorities, departments must
prepare a new document of delegation as quickly as possible for
the new minister's approval.
5. Departments spending authority must be delegated to
responsibility centre managers in relation to their budgetary
responsibility in order to ensure they have adequate authority
and full responsibility for their decisions.
6. Departments must delegate payment authority to positions
classified as "financial officer" who can independently verify
how other officers exercise spending authority.
7. Departments must establish adequate controls to ensure that
a specimen signature document is prepared as soon as a new
employee is appointed to a position with delegated authorities.
This document and delegation documents must be available in all
locations where the signatures will have to be recognized and
honoured. This document must be cancelled and withdrawn as soon
as the incumbent gives up the duties of the position, and
withdrawn and replaced when departmental reorganizations or
policy changes modify any of the information it contains.
Note: For computerized signature systems, please refer to the
"Electronic Authorization and Authentication policy".
Departments will conduct internal audits of their compliance
with this policy. The Treasury Board Secretariat will monitor the
effectiveness of this policy by reviewing departmental internal
audit reports.
Legislation
Financial Administration Act (R.S.C., 1985, Chapter
F-11), sections 32, 33 and 34;
Treasury Board Publications
Contracting policy, «Contracting» volume of the Treasury
Board Manual;
Chapter 2-2, "Electronic Authorization and Authentication"
"Comptrollership" volume, Treasury Board Manual.
Other Publications
Receiver General Directive 1993 " Submitting specimen
signatures to Government Services Canada".
Cancellation
This chapter cancels chapter 3-1 of the "Financial Management"
volume dated March 1, 1994; and
This chapter replaces sections 9.1 related to Delegation of
Authorities, 9.2 and Appendices 9A and B of the "Guide on
Financial Administration", consolidated revision April 1991.
Enquiries concerning this policy should be directed to your
departmental headquarters. Departmental headquarters should
contact:
Comptroller Sector
Program Branch
Treasury Board Secretariat
Ottawa, Ontario
K1A OR5
Telephone: (613) 957-7233
Facsimile: (613) 952-9613
1. Delegation to positions
Delegation should be to general categories of positions
wherever feasible. Depending on operational requirements,
departments may delegate financial authority to generic levels of
management and to organizational positions shown on a table of
equivalent positions.
2. Granting and communicating authorities
Departments are encouraged to use their own financial
administration manual to communicate authorities either on paper
or electronically. The manual would
- facilitate the distribution of delegation and their
amendments;
- provide easy reference to authorities delegated to specific
positions.
Whenever possible, a delegation document should be in chart
form to make it easier to explain and understand the relationship
between different delegated authorities.
3. Specimen signature and delegation documents
Delegation documents should be standardized to make it easier
to administer the departmental system of authorizations and
wherever departmental authorities must be honoured.
When deputy head changes, it is unnecessary to have the
delegation documents signed again since the minister is the only
person empower by the Financial Administration Act to
delegate authorities and authorize an other person to exercise it
on his or her behalf.
4. Restrictions
In most cases, delegated authorities to positions may be
restricted by geographical location, organizational unit,
operational activity, and dollar amounts commensurate with the
duties and responsibilities of positions.
Since the minister or deputy head grants authorities to
categories of positions that are subject only to general
restrictions, it is recommended that additional controls or
dollar limits below the maximum amounts be set in certain cases,
for example; for small establishments, when employees are only
partially trained, for special projects and for limited
budgets.
Where there is a requirement for an official certification or
attestation such as a travel claim or a delegation of authority
document, an original signature, not a facsimile produced by a
signing machine, is required, unless a statute or regulation
specifically provides for the use of a machine for this purpose
(e.g. Receiver General cheques, Government of Canada securities).
The use of a facsimile produced by a signing machine should be
reserved for routine correspondence and other documents not
requiring the exercise of ministerial discretion and authority or
requiring certification or attestation.
5. Power to Act for Ministers
For a number of years now, the courts have acknowledged that a
minister is not expected to personally exercise all authorities
conferred on that minister and that, in certain circumstances,
departmental officials may act for their minister in exercising
his or her statutory powers. This authority to act for a minister
has now been formally codified and is reflected in subsection
24(2) of the Interpretation Act and more specifically in
paragraph (d) thereof (see Chapter 6-2). That section
emphasizes that in order to act for a minister, a person
must:
- be a public servant employed in the department or
organization for which the minister is responsible; and,
- serve in a capacity within the department such that the
person can reasonably be expected to exercise the power of the
minister.
The first point limits those persons who may act for a
minister. The person must be a public servant; private
contractors and ministerial staff would not be included. Also,
the public servant must serve in the department over which the
minister presides; thereby excluding a minister of state without
a ministry.
The second point measures the exercising of a ministerial
power against such factors as position and job description,
hierarchical relationships, and geographical location in order to
assess whether the person could reasonably be expected to
exercise that power within the department.
Restrictions
This power to act for a minister under subsection 24(2)
applies only on a case-by-case basis and does not authorize a
continuing delegation of authority. Such continuing authority can
only be given by a formal delegation from the minister where a
statute so provides. Likewise this subsection does not apply to
any power to designate officials which has been expressly
conferred on ministers by statute; for instance the power of a
minister to designate authorized signing officers under sections
33 and 34 of the Financial Administration Act. Only the
minister him- or herself may delegate this authority.
6. Financial authorities
(a) Delegating spending and payment authority to the same
person
Persons who are delegated authority to make decisions may be
delegated either spending or payment authority, but usually not
both. However, in small establishments, this distinction is not
always possible, especially when an officer is assigned
responsibilities as an alternate for another officer or when a
financial officer administers a budget. In such circumstances, it
may be necessary to delegate both types of authority to a single
officer. Whenever this is done, the officer will never exercise
both types of authority on the same payment.
(b) Spending authority
Spending authority consists of four elements: expenditure
initiation, commitment control, contracting and confirmation of
contract performance and price.
When the minister delegates spending authority to officers
such as purchasing agents to enter into contracts and to
personnel officers to hire staff, they exercise the authority on
behalf of the responsibility centre managers.
To make it easier, responsibility centre managers may also
designate subordinates other than officers exercising payment
authority to exercise limited spending authority on their behalf
(e.g. use of acquisition cards and other governmental credit
cards).
1) Expenditure initiation
The authority to initiate an expenditure is exercised when
decisions are made to obtain goods or services that will result
in the eventual expenditure of funds, such as the decision to
hire staff, to order supplies or services, to authorize travel or
relocation or to enter into some other arrangement for program
purposes. The objective of this authority is to give operational
managers the primary responsibility for initiating expenditures
charged to their budgets.
2) Commitment authority
Commitment authority should be delegated to managers with
spending authority or to officers who have been delegated payment
authority or to subordinates the manager has designated,
depending on how the department can best meet its obligation to
maintain records of undischarged commitments.
If commitments are recorded centrally, it is normal to assign
this responsibility to the organizational units that have also
been delegated payment authority under section 33.
This authority may be delegated to officers who also have the
authority to initiate expenditure, to their administrative
support staff, and to any other central service according to
departmental needs. Even if the officer who has authority to
initiate expenditures originates commitment documentation,
central staff may record commitments in conformance with section
32 of the FAA if this is more effective and economical.
3) Contracting authority
In some major contractual agreements, departments may find it
advantageous to delegate contracting authority, as a further
subdivision of spending authority, to a purchasing agent.
However, such authority must be exercised only when the manager
responsible for the budget authorizes it. In other situations,
managers who have budgetary responsibility will also have
contracting authority.
The Department of Supply and Services Act gives the
Minister of Public Works and Government Services the exclusive
authority to procure goods. No other minister may contract for
goods unless this minister has received procurement delegation
from the Minister of Public Works and Government Services.
The minister of a department has the legal authority to enter
into a contract to the limit of the department's approved budget
and may delegate that authority to various levels in the
department. All departments have been granted standard
procurement delegation for local purchases; some departments have
received special delegations for specific goods.
The legal authority to enter into a contract is given in
section 7.3 and 41(1) of the Financial Administration Act.
Please refer to Treasury Board Contracts Directive in Appendix C
of the Contracting volume of the Treasury Board Manual for
details on the delegation of contracting authority.
4) Authority to confirm contract performance and price granted
to officers
When the authority to confirm price and performance is granted
to officers, they exercise this authority on behalf of the
minister and in support of the manager who has budgetary
responsibility unless the officers are managing their own
budgets.
(c) Payment authority
When recommending positions to the minister for the delegation
of payment authority, all financial officers in a location, not
just to those involved directly in the payment process should be
considered.
To allow the Department of Public Works and Government
Services to verify if payment authority has been respected,
limits on authority to requisition payments or charges against an
appropriation may be expressed as a maximum dollar amount for
each position. An exception to this rule is permissible when the
incumbent of a single position is granted authority to sign for
"pay input" and other payment requisitions. Two different limits
may be shown in this case.
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