Backgrounder
In November 2004, the Government approved a new approach to Government
advertising, which built on the Government's ongoing efforts to strengthen
advertising management and incorporated changes to the Communications Policy
of the Government of Canada.
The government's new approach to advertising is guided by the principles of
value for money, transparency, and accountability. The three main objectives are
to:
- lower the cost and strengthen the management of advertising;
- improve planning and decision-making to achieve strategic communication objectives; and
- ensure transparency of advertising activities.
Lowering Costs and Strengthening Management
On March 15, 2004, the Minister of Public Works and Government
Services announced a moratorium on new Government of Canada advertising to allow
time to address more fully the concerns raised by the Auditor General in her November 2003 report, including the implementation of new measures to strengthen the
management of government advertising from planning, to procurement to evaluation.
As part of these efforts, the Government announced a reduction over 2002-03 in advertising spending
to achieve a 15% reduction in its media placement
expenditures. To implement this decision:
- advertising budgets in departments and agencies were frozen at 2004-05 levels at $86.9 million, and then reduced by $12.45 million; and
- the balance of $74.4 million per year was set aside in the fiscal framework
for 2004-05 and each year thereafter.
This reduction in media placement spending will be in effect until the end of 2006-2007.
In fiscal year 2004-05, the Government of Canada is projecting to spend approximately $59 million on advertising compared to $111 million in 2002-03,
and $77 million in 2003-04.
Improving Planning and Decision-Making
Since 2002, the Government has emphasized a number of key principles in its management of advertising, including the need to:
- provide factual information to Canadians on programs and services;
- target key audiences and demographic groups with relevant and practical
information, including regional tailoring of approved advertising
initiatives;
- offer a choice of access channels; and
- build initiatives based on research and evaluate them using standard industry practices.
As part of its efforts to strengthen advertising announced in March 2004, the
Government also announced that it would establish a government-wide priority
setting mechanism to plan and fund core advertising initiatives. This process
affects all government institutions under schedules I, I.I and II of the Financial
Administration Act (FAA).
Annual Planning Cycle
A key element of the new approach to advertising includes more rigorous
planning and management on an annual cycle.
Under the new cycle:
- departments and agencies must prepare advertising proposals reflecting the objectives outlined by government, and through a peer review and vetting process,
recommendations are submitted to a committee of Cabinet for discussion (Note:
this discussion is limited to the merit and design of campaigns, and is
completely distinct from the procurement process described below);
- for those advertising initiatives which are then approved, departments and
agencies prepare a Treasury Board submission to obtain Treasury Board approval for the
allocation of funds;
- following Treasury Board approval, funds are allocated to departments to
be managed by them and the allocations are posted to the Treasury Board of Canada
Secretariat web site; and
- Public Works and Government Services Canada administers contracting and procurement for approved initiatives, administers the Advertising Management
Information System (AdMIS), and develops and issues an annual report.
Federal institutions are encouraged to pool their knowledge and efforts to develop joint advertising initiatives on shared themes and geared to common
audiences.
For more information on roles and responsibilities, see http://www.tbs-sct.gc.ca/pubs_pol/sipubs/comm/adv-pub/rr-rr_e.asp.
A New Approach to Advertising Procurement
Building on industry consultations and other changes already made in response to the Auditor General's observations on advertising contracting in her
November 2003 report (tabled in Parliament on February 10, 2004), the government introduced a three-tier procurement approach. On May 21, 2004,
through a national competitive process and a more clearly defined scope of work, the
Government selected Cossette Communication Inc. of Toronto as its new Agency of
Record - the Agency responsible for purchasing all paid media space on behalf of the Government of Canada. The contract is for three years, with two one-year
extension options.
The government also launched a full, open bidding process to select new
creative agencies. Under the oversight of a fairness monitor, the government
awarded standing offers and supply arrangements to 16 advertising agencies
across Canada. These agencies are responsible for creative planning and
production and for planning the media buys. As of this year, creative agencies
are paid on an hourly basis as opposed to the former commissions-based
remuneration.
Finally, for any advertising campaign of a value greater than $750,000 in
creative work (exclusive of media space purchases), the government will issue a competitive request for proposals on
MERX—the government's electronic tendering system.
AdMIS, the new Advertising Management Information System developed to help
government advertising managers in their day to day work and to facilitate
information sharing and learning, will help to document all campaign
transactions, including a project's authorization number, contracts, actual
costs, scope of work, media plans and reports.
Ensuring Transparency
Enhanced transparency measures are an important element in the government's
new approach to ensure that Parliamentarians and Canadians are well informed of
government advertising activities. The following measures are in place:
- all approved advertising initiatives are now posted on the Treasury Board of Canada Secretariat web site;
- all advertising-related contracts are posted on Contracts Canada, Public Works and Government Services Canada (PWGSC) web site for contract-related
information and all departments and agencies must also post all contracts over $10,000 on their own
respective web site;
- the advertising annual report prepared and released publicly by PWGSC provides an overview of the government's advertising management
practices,
outlines the Government of Canada advertising initiatives and provides an overview of the results achieved. The annual
report also lists all expenditures
by federal institutions, as well as expenditures by media type; and
- all advertising research undertaken by the Government of Canada in the
preparation of possible campaigns is published on the PWGSC web site and is also available publicly in the annual
report on the public opinion research.
For more information on contracting, please see PWGSC's web site at: www.contractscanada.gc.ca
For funding allocations approved by Treasury Board, see http://www.tbs-sct.gc.ca/pubs_pol/sipubs/comm/adv-pub/index_e.asp.
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