3.2 Financial Tables

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

($ thousands)

Program activity	2003‑04 Actual	2004‑05 Actual	2005‑06
			Main Estimates	Planned Spending	Total Authorities	Actual
Policies, Rulemaking, Monitoring and Outreach in support of a safe and secure transportation system	441,129	438,705	441,772	441,501	523,159	485,906
Canadian Air Transport Security Authority	351,415	501,171	438,400	438,400	438,400	428,766
Policies, Programs and Infrastructure in support of a market-based framework	282,081	338,214	311,797	319,706	352,623	333,826
Jacques Cartier and Champlain Bridges Inc.	33,024	32,019	32,188	31,288	32,188	31,288
Marine Atlantic Inc.	41,595	72,907	24,533	24,533	70,233	70,233
VIA Rail Canada Inc.	264,201	191,301	169,001	169,001	169,001	169,001
Policies and Programs in support of sustainable development	21,727	33,876	74,888	74,339	73,156	55,144
Total	1,435,172	1,608,192	1,492,579	1,498,768	1,658,760	1,574,165
Less: Non‑Respendable revenue	(68,100)	(48,017)	-	(31,691)	(76,128)	(76,128)
Plus: Cost of services received without charge	58,040	54,682	-	56,657	59,718	59,718
Total Department Spending	1,425,112	1,614,858	1,492,579	1,523,734	1,642,350	1,557,755
Full Time Equivalents	4,813	4,718	4,786	4,956	4,956	4,873

Due to rounding, columns may not add to total shown.

Table 2: Resources by Program Activity

Program Activity	2005‑06 Budgetary ($ thousands)
	Operating 1			Capital	Grants		Contributions and Other Transfer Payments 2	Total: Gross Budgetary Expenditures	Less: Respendable Revenue	Total: Net Budgetary Expenditures
Policies, Rulemaking, Monitoring and Outreach in support of a safe and secure transportation system
Main Estimates	441,842			38,330	300		60,223	540,695	(98,923)	441,772
Planned Spending	438,561			41,340	300		60,223	540,424	(98,923)	441,501
Total Authorities	489,455			38,503	200		48,173	576,331	(53,172)	523,159
Actual Spending	469,211			36,946	200		33,295	539,652	(53,746)	485,906
Canadian Air Transport Security Authority
Main Estimates	303,532			134,868	-		-	438,400	-	438,400
Planned Spending	303,532			134,868	-		-	438,400	-	438,400
Total Authorities3	438,400			-	-		-	438,400	-	438,400
Actual Spending3	428,766			-	-		-	428,766	-	428,766
Policies, Programs and Infrastructure in support of a market-based framework
Main Estimates	136,563		35,076		24,952		362,070	558,661	(246,864)	311,797
Planned Spending	144,472		35,076		24,952		362,070	566,570	(246,864)	319,706
Total Authorities	209,259		35,035		24,952		397,638	666,884	(314,261)	352,623
Actual Spending	218,815		24,807		24,890		378,989	647,501	(313,675)	333,826
Jacques Cartier and Champlain Bridges Inc.
Main Estimates	28,574		3,614		-		-	32,188	-	32,188
Planned Spending	27,674		3,614		-		-	31,288	-	31,288
Total Authorities3	32,188		-		-		-	32,188	-	32,188
Actual Spending3	31,288		-		-		-	31,288	-	31,288
Marine Atlantic Inc.
Main Estimates	23,503	1,030				-	-	24,533	-	24,533
Planned Spending	23,503	1,030				-	-	24,533	-	24,533
Total Authorities3	70,233	-				-	-	70,233	-	70,233
Actual Spending3	70,233	-				-	-	70,233	-	70,233

Table 2: Resources by Program Activity (continued)

Program Activity	2005‑06 Budgetary ($ thousands)
	Operating 1		Capital		Grants	Contributions and Other Transfer Payments 2		Total: Gross Budgetary Expenditures	Less: Respendable Revenue	Total: Net Budgetary Expenditures
VIA Rail Canada Inc.
Main Estimates	169,001	-		-		-	169,001		-	169,001
Planned Spending	169,001	-		-		-	169,001		-	169,001
Total Authorities3	169,001	-		-		-	169,001		-	169,001
Actual Spending3	169,001	-		-		-	169,001		-	169,001
Policies and Programs in support of sustainable development
Main Estimates	58,093	1,384		-		26,104	85,581		(10,693)	74,888
Planned Spending	57,544	1,384		-		26,104	85,032		(10,693)	74,339
Total Authorities	57,693	1,252		-		14,246	73,191		(35)	73,156
Actual Spending	42,311	4,816		-		8,065	55,192		(47)	55,144
Total
Main Estimates	1,161,108	214,302		25,252		448,397	1,849,059		(356,480)	1,492,579
Planned Spending	1,164,287	217,312		25,252		448,397	1,855,248		(356,480)	1,498,768
Total Authorities	1,466,229	74,790		25,152		460,057	2,026,228		(367,468)	1,658,760
Actual Spending	1,429,625	66,569		25,090		420,349	1,941,633		(367,468)	1,574,165

Due to rounding, columns may not add to total shown.

Notes:

1. Operating includes statutory payments for employee benefit plans, Minister's allowances, previous years' refunds, payments in respect of the St. Lawrence Seaway Agreement, and proceeds from the disposal of surplus Crown assets.

2. Contributions and Other Transfer Payments include Statutory Payments for Victoria Bridge (Montreal) and the Northumberland Strait Crossing subsidy.

3. Total Authorities and Actual Spending under each Crown corporation: Represents the payment by Transport Canada of the money appropriated to the Crown corporation. It does not differentiate between the operating and capital expenditure made by the Crown corporation.

Table 3: Voted and Statutory Items

Vote or Statutory Item	Truncated Vote or Statutory Wording	2005-06 ($ thousands)
		Main Estimates	Planned Spending	Total Authorities	Total Actual
1	Operating expenditures	197,377	201,456	291,871	267,934
5	Capital expenditures	74,790	77,800	74,790	66,569
10	Grants and Contributions	417,299	417,299	429,626	389,856
15	Payments to Jacques Cartier and Champlain Bridges Inc.	32,188	31,288	32,188	31,288
20	Payments to Marine Atlantic Inc.	24,533	24,533	70,233	70,233
25	Payments to VIA Rail Inc.	169,001	169,001	169,001	169,001
30	Payments to the Canadian Air Transport Security Authority	438,400	438,400	438,400	428,766
(S)	Minister of Transport Canada - Salary and motor car allowance	70	70	77	77
(S)	Contributions to employee benefit plans	64,671	64,671	65,328	65,328
(S)	Payments to Canadian National Railway Company in respect of the termination of the collection of tolls on the Victoria Bridge, Montreal and for the rehabilitation work on the roadway portion of the Bridge	3,300	3,300	2,793	2,793
(S)	Payments in respect of the St. Lawrence Seaway agreements	17,900	17,900	29,330	29,330
(S)	Northumberland Strait Crossing subsidy payment	53,050	53,050	52,790	52,790
(S)	Spending of proceeds from the disposal of surplus Crown assets	-	-	2,133	-
(S)	Refunds of amounts credited to revenues in previous years	-	-	200	200
	Total	1,492,579	1,498,768	1,658,760	1,574,165

Due to rounding, columns may not add to total shown.

(S): Statutory

Table 4: Services Received Without Charge

	2005-06 ($ thousands)
Accommodation provided by Public Works and Government Services Canada (PWGSC)	23,693
Contributions covering employer's share of employees' insurance premiums and expenditures paid by Treasury Board Secretariat (excluding revolving funds). Employer's contribution to employees' insured benefits plans and associated expenditures paid by TBS.	28,879
Worker's compensation coverage provided by Human Resources and Skills Development Canada	4,247
Salary and associated expenditures of legal services provided by Justice Canada	2,899
Total Services Received Without Charge	59,718

Due to rounding, columns may not add to total shown.

Table 5: Sources of Respendable and Non-Respendable Revenue

($ thousands)

Respendable Revenue 1	Actual 2003‑04	Actual 2004‑05	2005‑06
			Main Estimates	Planned Revenue	Total Authorities	Actual
Policies, Rulemaking, Monitoring and Outreach in support of a safe and secure transportation system
Canadian aviation regulation fees	7,962	7,861	8,817	8,817	8,817	8,415
Aircraft maintenance and flying services	29,366	30,710	25,260	25,260	30,060	30,144
Marine safety regulation fees	9,371	8,259	7,394	7,394	8,394	8,437
Inspections and certifications	3,709	3,491	1,027	1,027	4,527	4,610
Research and development	-	448	-	-	-	-
Airports - lease 2	-	-	50,000	50,000	-	-
Miscellaneous	2,084	2,206	6,425	6,425	1,374	2,140
Sub-total	52,492	52,975	98,923	98,923	53,172	53,746
Policies, Programs and Infrastructure in support of a market-based framework
Air services forecasts revenues	225	253	160	160	160	235
Public port revenues	12,417	12,882	8,440	8,440	10,128	11,328
Airport operations revenues	11,700	11,341	9,985	9,985	9,985	10,497
Airports - lease and chattel payments 2	214,441	241,862	221,092	221,092	291,092	288,697
Research and development	3,870	3,566	1,884	1,884	1,884	2,554
Miscellaneous	772	635	5,303	5,303	1,013	364
Sub-total	243,425	270,539	246,864	246,864	314,262	313,675
Policies and Programs in support of sustainable transportation
Airports - lease 2	-	-	10,000	10,000	-	-
Miscellaneous	32	82	693	693	34	47
Sub-total	32	82	10,693	10,693	34	47
Total Respendable Revenue	295,950	323,596	356,480	356,480	367,468	367,468

Table 5: Sources of Respendable and Non-Respendable Revenue (continued)

($ thousands)

Non-Respendable Revenue	Actual 2003‑04	Actual 2004‑05	2005‑06
			Main Estimates	Planned Revenue	Total Authorities	Actual
Hopper car rentals	18,664	17,386	-	15,000	17,701	17,701
Canada Port Authority stipends	10,716	10,844	-	11,721	11,698	11,698
Non-navigational assets - St. Lawrence Seaway	-	-	-	4,900	10,385	10,385
Research and development - Royalty revenue	-	-	-	70	61	61
Return on investments	22,958	205	-	-	5,882	5,882
Refunds of previous year's expenditures	1,999	1,851	-	-	16,225	16,225
Adjustments to previous year's payables	1,729	4,862	-	-	6,794	6,794
Privileges, licences and permits	4,925	8,616	-	-	37	37
Fines	974	1,329	-	-	893	893
Proceeds from sales	548	1,243	-	-	-	-
Proceeds from disposal of surplus Crown assets	2,760	1,170	-	-	963	963
Proceeds from divestiture sale of real property	-	-	-	-	5,059	5,059
Interest revenue from divested airports	-	-	-	-	20	20
Old Port of Montreal	2,404	-	-	-	-	-
Miscellaneous	423	509	-	-	410	410
Total Non-Respendable Revenue	68,100	48,017	-	31,691	76,128	76,128

Due to rounding, columns may not add to total shown.

Notes:

1. For consistency with amounts published in the Public Accounts (Details of Respendable Amounts), the respendable revenue categories include a share of departmental administration's respendable revenue.

2. All actual airport lease revenue are recorded against the program activity Policies, Programs and Infrastructure in support of a market-based framework although an adjustment was made to the planned revenue to allocate some of the vote netted airport lease revenue to other program activities

Table 6: Resource Requirements by Branch/Sector level

($ thousands)

Organization 1	Policies, Rulemaking, Monitoring and Outreach in support of a safe and secure transportation system	Policies, Programs and Infrastructure in support of a market-based framework	Policies and Programs in support of sustainable development	Crown corporations2	Total
Assistant Deputy Minister, Safety and Security
Planned Spending	284,185	-	-	-	284,185
Actual Spending	285,852	-	53	-	285,905
Assistant Deputy Minister, Policy
Planned Spending	-	208,858	274	-	209,132
Actual Spending	-	215,123	-	-	215,123
Assistant Deputy Minister, Programs 3
Planned Spending	-	42,300	64,180	-	106,480
Actual Spending	255	(47,974)	20,757	-	(26,961)
Regional Director General, Atlantic
Planned Spending	26,842	8,081	2,216	-	37,139
Actual Spending	34,663	57,207	4,432	-	96,302
Regional Director General, Quebec
Planned Spending	30,827	26,724	1,524	-	59,075
Actual Spending	41,033	42,597	6,669	-	90,299
Regional Director General, Ontario
Planned Spending	36,615	10,034	662	-	47,311
Actual Spending	43,149	21,466	4,446	-	69,061
Regional Director General, Prairie and Northern Region
Planned Spending	32,592	14,602	4,628	-	51,822
Actual Spending	41,423	27,770	6,039	-	75,232
Regional Director General, Pacific
Planned Spending	30,440	9,107	855	-	40,402
Actual Spending	39,532	17,638	12,748	-	69,917
Total
Planned Spending	441,501	319,706	74,339	663,222	1,498,768
Actual Spending	485,906	333,826	55,144	699,288	1,574,165

Due to rounding, columns may not add to totals shown.

Notes:

1. The expenditures by organization presented under each program activity include a portion of departmental administration expenditures.

2. The Crown corporations presented in Transport Canada's Program Activity Architecture are the Canadian Air Transport Security Authority, Jacques Cartier and Champlain Bridges Inc., Marine Atlantic Inc. and VIA Rail Canada Inc. See Table 1 for their respective financial resources.

3. The sector "Assistant Deputy Minister - Programs" includes all the Vote Netted Revenue recorded under the Program Activity "Policies, Programs and Infrastructure in support of a market based framework". The planned Vote Netted Revenue is higher than expenses for that sector therefore the amount is presented in brackets.

Table 10: Alternative Service Delivery

In 2006‑2007, Transport Canada will be renewing the existing initiative for the following program.

1. Motor Vehicle Test Centre (renewing)

Further information on this alternative service delivery initiative can be found at http://www.tbs-sct.gc.ca/est-pre/estime.asp.

Table 11: Horizontal Initiatives

In 2005‑06, Transport Canada was involved in the following horizontal initiatives as either the lead or as a partner:

1. Marine Security Horizontal Initiative (lead)
2. Canada Strategic Infrastructure Fund (partner)
3. Border Infrastructure Fund (partner)

Note:

Road Safety Vision 2010 was listed in the Report on Plans and Priorities 2005‑2006 as a horizontal initiative. Based on criteria identified in the Guide to the Preparation of Part III of the 2005‑06 Estimates from the Treasury Board Secretariat, it was determined that Road Safety Vision 2010 is not an horizontal initiative as there is no formal funding agreement. Consequently, no information is available from other parties and this initiative will not be listed as a horizontal initiative in the future.

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

10. (a) National Airport System assets (cont'd)

The National Airport System assets recorded above consist of the land, buildings, work and infrastructures of the remaining 23 Canadian airports.

Transport Canada has leased all of these airports under long-term operating agreements with Canadian Airport Authorities (22) and a municipal government (1). These agreements are in accordance with the federal National Airports Policy, the Public Accountability Principles for Canadian Airport Authorities and the Fundamental Principles for the Creation and Operations of Canadian Airport Authorities, which, in part, entails the transfer of the management, operations and maintenance of certain airports in Canada to Canadian Airport Authorities.

Transport Canada has the right to terminate the operating agreements and assume the responsibility for the management, operation and maintenance of the airport if the leased airports are not operated in accordance with the terms of the respective operating agreements and the Policies and Principles referred to above.

11. Accounts payable and accrued liabilities

	2006	2005
	(In thousands of dollars)
Payables to third parties	$ 566,566	$ 310,431
Payables to other government departments	69,041	48,673
Accrued salaries	15,589	23,682
Other accounts payable and accrued liabilities	38,609	42,679
Total Accounts Payable and Accrued Liabilities	$ 689,805	$ 425,465

12. Employee Benefits

1. 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/Québec Pension Plans benefits and they are indexed to inflation.
   
   Both the employees and the department contribute to the cost of the Plan. The 2005‑06 expense amounts to $58,770,000 ($55,664,000 in 2004‑05), which represents approximately 2.6 times 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.
   
2. 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:

	2006	2005
	(In thousands of dollars)
Accrued benefit obligation, beginning of year	$ 64,705	$ 60,792
Expense for the year	14,435	9,230
Benefits paid during the year	(5,424)	(5,317)
Accrued benefit obligation, end of year	$ 73,716	$ 64,705

13. Lease obligations for tangible capital assets

Under the Northumberland Strait Crossing Act, the Government of Canada entered into a long-term capital lease arrangement in 1992 and is obligated to pay an annual subsidy of $41,900,000 (1992 dollars) to the Strait Crossing Finance Inc., a wholly owned corporation of the Province of New Brunswick, for the construction of the Confederation Bridge. The annual payments made by Transport Canada are due on April 1^st and will be used to retire $661,000,000 of 4.5 percent real rate bonds issued in October 1993 by Strait Crossing Finance Inc. to finance the construction of the bridge. Annual payments made by Transport Canada began in 1997 and will continue until 2033. At such time, the ownership of the bridge will be transferred to the Government of Canada.

On April 1, 2005 an annual payment in the amount of $52,790,000 was made. This payment represents payment of principal in the amount of $13,480,721 and interest expense of $39,309,279.

The department has recorded a capital lease obligation of $682,660,000 as of March 31, 2006 based on the present value for the future subsidy payments using an interest rate of 6.1605%.

Future minimum annual lease payments are as follows:

Maturing year	2006	2005
	(In thousands of dollars)
2005‑2006	-	52,790
2006‑2007	54,265	51,776
2007‑2008	52,558	52,558
2008‑2009	53,352	53,352
2009‑2010	54,158	54,158
2010‑2011	54,976	54,976
2011‑2012 and thereafter	1,379,736	1,379,736
Total future minimum lease payments	1,649,045	1,699,346
Less: imputed interest	966,385	1,003,205
Balance of obligations under leased tangible capital assets	$ 682,660	$ 696,141

14. Contingent liabilities

1. Contaminated sites
   
   Liabilities are accrued to record the estimated costs related to the management and remediation of contaminated sites where Transport Canada is obligated or likely to be obligated to incur such costs. The department has identified approximately 571 sites (556 sites in 2005) where such action is possible and for which a liability of $149,670,000 ($164,802,000 in 2005) has been recorded. The department has estimated additional clean-up costs of $154,427,000 ($154,629,000 in 2005) that are not accrued, as these are not considered likely to be incurred at this time. Transport Canada'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.
2. Claims and litigation
   
   Claims have been made against Transport Canada in the normal course of operations. Legal proceedings for claims totalling approximately $37,500,000 ($33,424,000 in 2005) were still pending at March 31, 2006. 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 recorded in the financial statements.
   
   Transport Canada is named as a defendant in a claim for $330,000,000 filed by the Mohawks of Akwesasne. The action was first initiated in 1976 for unlawful expropriation and breach of fiduciary duty regarding the expropriation of land in the 1950's for the construction of the Saint Lawrence Seaway and of the Seaway International Bridge. The outcome of this claim is not determinable at this time. No accrual for this contingency has been made in the financial statements.

15. Restricted equity of Canada

The department includes in its revenues and expenses certain transactions that legislation requires be earmarked for expenses relating to a specified purposes. The department has two such accounts:

1. The Ship-source Oil Pollution Fund (Fund) was established pursuant to section 702 of the Canada Shipping Act, to record levy tonnage payments for oil carried by ships in Canadian waters. Maritime pollution claims, the fee of the Fund Administrator, and related oil pollution control expenses, are financed out of the Fund.

	2006	2005
	(In thousands of dollars)
Restricted Ship-source Oil Pollution:
Balance - April 1, 2005	$ 339,109	$ 330,734
Revenues	12,316	12,912
Expenses	(582)	(4,537)
Balance - March 31, 2006	$ 350,843	$ 339,109

2. The Fines for Transport of Dangerous Goods account was established pursuant to the Transportation of Dangerous Goods Act, 1992 and related regulations to record fines levied by courts.

	2006	2005
	(In thousands of dollars)
Restricted - Fines for Transport of Dangerous Goods:
Balance - April 1, 2005	$ 611	$ 614
Revenues	44	21
Expenses	(56)	(24)
Balance - March 31, 2006	$ 599	$ 611
Restricted equity of Canada	$ 351,442	$ 339,720

16. Contractual obligations

The nature of Transport Canada's activities results in some large multi-year contracts and obligations whereby the department will be committed to make some future payments when the services/goods are rendered. Significant contractual obligations that can be reasonably estimated are as follows:

(In thousands of dollars)	2006 -2007	2007 -2008	2008 -2009	2009 -2010	2010 -2011	There-after	Total
Transfer payments	$300,745	$110,548	$74,639	$73,176	$37,379	$63,575	$660,062
Tangible capital assets	5,752	523	139	-	-	-	6,414
Other goods and services	10,014	4,222	2,013	1,617	-	-	17,866
Software maintenance agreements	2,127	1,176	644	195	-	-	4,142
Building retrofits	200	-	-	-	-	-	200
Other	976	-	-	-	-	-	976
Total	$319,814	$116,469	$77,435	$74,988	$37,379	$63,575	$689,660

17. Related party transactions:

Transport Canada 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, Transport Canada received services, which were obtained without charge from other Government departments as presented below.

Services provided without charge:

During the year the department received without charge from other departments, accommodation, the employer's contribution to the health and dental insurance plans, worker's compensation, and legal services.

These services without charge have been recognized in the department's Statement of Operations as follows:

	2006	2005
	(In thousands of dollars)
Accommodation provided by Public Works and Government Services Canada	$ 23,693	$ 22,194
Contributions covering employer's share of employees' insurance premiums and costs paid by Treasury Board Secretariat	28,879	25,069
Worker's compensation cost provided by Human Resources and Skills Development Canada	4,247	4,055
Legal services provided by Department of Justice	2,899	3,364
Total	$ 59,718	$ 54,682

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.

Table 13: Response to Parliamentary Committees, Audits and Evaluations for FY 2005‑2006

Response to Parliamentary Committees

Nil

Response to the Auditor General including to the Commissioner of the Environment and Sustainable Development (CESD)

April 2005 Auditor General's Report Chapter 2 - National Security in Canada - The 2001 Anti-Terrorism Initiative: Air Transportation Security, Marine Security, and Emergency Preparedness http://www.oag-bvg.gc.ca/domino/reports.nsf/html/20050402ce.html. This audit included a number of federal government departments and agencies, including Transport Canada. With respect to Transport Canada, the audit focused on assessing whether: Transport Canada's oversight of the air transport security system is adequate; Transport Canada and the Canadian Air Transport Security Authority (CATSA) have adequately managed those elements of Explosives Detection Systems acquisition and implementation for which they are responsible; and the International Ship and Port Facility Security Code was implemented according to the government's plan. With respect to air transportation security, the Auditor General made the following recommendations (Transport Canada's response to each recommendation is also found below): 2.29 Recommendation: Transport Canada should complete a formal analysis of threats and risks to the entire air transport system and use the results as a basis for deploying resources and focussing enforcement efforts. Transport Canada's response: Transport Canada recognizes the importance of risk management, which has been an essential foundation of its aviation security program since its inception in the 1970s. More recently, the department has initiated a comprehensive Transportation Security Strategy, which will examine risk in all modes and activities within each mode. The strategy will include a formal threat-and-risk-analysis instrument that could be used in risk management decision making for regulatory, legislative, and enforcement activities (spring 2006). In the interim, Transport Canada will continue to rely on its inspectors and existing analytical capacity to address emerging security needs. 2.50 Recommendation: Transport Canada should put in place system-wide performance measures that specify what it considers to be satisfactory performance by the Canadian Air Transport Security Authority (CATSA). Transport Canada's response: Transport Canada has developed a comprehensive enforcement program, including monitoring and inspection, to ensure compliance with the rules. With respect to CATSA, Transport Canada has taken, and will continue to take, an incremental approach to enforcement. While Transport Canada does not consider monetary penalties to be necessarily the best compliance tool, it can take appropriate enforcement action, drawing if necessary on the range of legislative and administrative mechanisms available, including holding directors and officers accountable. In addition, Transport Canada is now developing system-wide qualitative and quantitative measures of performance by screeners and equipment, which will be reviewed on a regular basis. Measures will be finalized by early 2006. No audit recommendations were made with respect to Transport Canada's role in marine security. November 2005 Auditor General's Report Chapter 8 - Other Audit Observations Audit: Transport Canada - The Quebec Bridge http://www.oag-bvg.gc.ca/domino/reports.nsf/html/20051108ce.html The audit objective was to determine whether, at the time of the Quebec Bridge transfer in 1993 and the 1997 funding agreement, Transport Canada had applied management principles that protected the interests of Canadian taxpayers and ensured the long-term viability of this essential infrastructure. The audit concluded that the restoration work on this regional transportation infrastructure is only partially completed. Major issues remain regarding the financing of the rest of the restoration work in the years to come. While no recommendations were directed at Transport Canada, the department provided comments. Transport Canada's position is that Canadian National (CN) is responsible for the long-term viability of the Quebec Bridge as per the 1993 agreement. The department intends to ensure that CN fully complies with the requirements of the 1993 agreement as well as the requirements of the 1997 tripartite agreement pertaining to the restoration program for the Quebec Bridge. For the past fifteen years, Transport Canada's policy has been to divest itself of the operations of the transportation system. In the case of the Quebec Bridge and other Canadian Government Railway (CGR) lands, the Government transferred the lands to CN, a Crown Corporation, which had been entrusted the lands for management and operation since 1923. The full value of CN, including the CGR lands, was realized by Canadian taxpayers through the privatization of CN in 1995. 2005 Status Report of the Auditor General Chapter 2 - Transport Canada - Overseeing the National Airports System  http://www.oag-bvg.gc.ca/domino/reports.nsf/html/20050202ce.html . The objective of this follow-up audit was to evaluate the extent to which Transport Canada implemented the recommendations of the Auditor General's 2000 audit of Airport Transfers - National Airports System (NAS). The Auditor General made the following recommendations (Transport Canada's response is also found below): 2.55 Recommendation: Canada should clarify how it will continue overseeing the long-term viability of the NAS once the data from the Airports Rent Policy Review becomes obsolete. In particular, it should determine what data to collect; who will collect it, how often, and how it will be collected; and how the results will be used. Transport Canada's response: To determine if policies and frameworks are working as intended and to provide early warning indicators of potential financial trouble at an airport, the department intends to build upon the work it did assessing the long-term viability of the leased NAS airports for the Rent Policy Review. To facilitate this, the existing forecast model would be updated, on an ongoing basis, with current financial and traffic data. 2.56 Recommendation: Transport Canada should develop a comprehensive strategy for responding in the event that an airport authority encounters serious financial difficulty. In particular, the strategy should state who in the department would assume primary responsibility, when the department would intervene and the methods it would use, and the legal limits of the intervention. Transport Canada's response: Transport Canada concurs. As noted in the department's discussion paper, serious financial difficulty can arise from a variety of underlying causes, which may accordingly require different skill sets (finance and accounting, policy, operations, etc.). The department will develop a variety of case scenarios to ensure it can: assign primary responsibility in any foreseeable case; marshal the necessary information for decision makers to decide whether to intervene, and if so, how; and identify the legal and financial authorities the department has or would have to obtain for such a case. 2.65 Recommendation: Transport Canada should: develop a framework identifying the airports whose performance it wants to measure; what it needs to measure; what data it needs to collect, who will collect it, how it will be collected, and how often; how it will use the results; and how it will report on the performance; have the framework approved by departmental executives; and start, as soon as possible, collecting data, measuring the airports' performance, and reporting on the results. Transport Canada's response: Transport Canada recognizes the importance of developing and implementing a performance-monitoring framework. This was reflected in early drafts of a proposed legislative framework for airports (2003). To ensure that airport business dynamics and data availability are taken into consideration, this project would be developed in consultation with the relevant airports to identify and prioritize appropriate performance measures. The department will enhance its data gathering capabilities, as well as determine the best approach to report the results. 2005 Report of the Commissioner of the Environment and Sustainable Development Chapter 3 - Canadian Biodiversity Strategy: A Follow-Up Audit http://www.oag-bvg.gc.ca/domino/reports.nsf/html/c20050903ce.html The objective of this follow-up audit was to determine the progress by the federal government in implementing selected aspects o the Canadian Biodiversity Strategy. This audit included a number of federal government departments and agencies. No audit recommendations were directed at Transport Canada. Chapter 7 - Sustainable Development Strategies http://www.oag-bvg.gc.ca/domino/reports.nsf/html/c20050907ce.html In this audit, the Commissioner of the Environment and Sustainable Development focused on four key areas: government-wide direction, the quality of the 2004 Sustainable Development Strategies, implementation of Strategy commitments, and action on international commitments. No audit recommendations were directed at Transport Canada. Chapter 8 - Environmental Petitions http://www.oag-bvg.gc.ca/domino/reports.nsf/html/c20050908ce.html The objective of this audit was to inform Parliament and Canadians on the use of the petitions process and the Commissioner's monitoring of commitments and statements made in response to specific petitions. This audit included a number of federal government departments and agencies. No audit recommendations were directed at Transport Canada.

External Audits (note: these refer to other external audits conducted by the Public Service Commission or the Office of the Commissioner of the Official Languages or the Official Languages Branch of the Public Service Human Resources Management Agency).

Nil

Internal Audits or Evaluations

Internal audits approved by Transport Canada's Audit and Review Committee in 2005‑06: Audit of the Transportation Association of Canada Contribution Program Final Audit Report - Cabin Security Enhancement Contribution Program Financial Audit of the Operation and Maintenance of the Blainville Motor Vehicle Test Centre Review of Priority Cheque Printing Facility Review of CN Alternate Use Agreements - Phase IV - 2000 - 2003 Crop Years Study of the Quality of Information for Resource Decision-Making - Phase 1 More information is available at http://www.tc.gc.ca/corporate-services/audit/menu.htm. Internal evaluations completed by Departmental Evaluation Services in 2005‑06: Grant to British Columbia Ferries Contribution to the Canadian Wheat Board for leasing of hopper cars Evaluation of Ridley Terminals - September 2005 Grade Crossing Improvement Program Combined evaluation of contributions to the Canadian Red Cross and the Canadian Safe Boating Council Outaouais Roads Agreement Contribution Sustainable Transportation Fund (MOST) More information is available at http://www.tc.gc.ca/programevaluation/reports/menu.htm.

Table 14: Sustainable Development Strategies (SDS)

Department: Transport Canada
Points to address	Departmental Input
1. What are the key goals, objectives, and/or long-term targets of the SDS?	TC has seven strategic challenges: Encourage Canadians to make more sustainable transportation choices Enhance innovation and skills development Increase system efficiency and optimize modal choices Enhance efficiency of vehicles, fuels, and fuelling infrastructure Improve performance of carriers and operators Improve decision-making by governments and the transportation sector Improve management of Transport Canada operations and lands.
2. How do your key goals, objectives and/or long-term targets help achieve your department's/agencies' strategic outcomes?	Transport Canada's seven strategic challenges reflect the key results that the department intends to influence. Within these seven challenges there are 32 commitments and 173 targets where the department will focus its efforts for the 2004‑2006 period. This is in direct support of the department's strategic outcomes to: Ensure high standards for a safe and secure transportation system; Contribute to Canada's economic growth and social development; and, Protect the physical environment The strategy also addresses key federal priorities such as climate change, clean air, clean water, and contaminated sites.
3. What were your targets for the reporting period?	The strategy identifies a total of 173 targets, which are reported on an annual basis.
4. What is your progress to date?	For the 2005‑06 fiscal year, over 90% of the targets for the 2004‑2006 SDS were reported to be either complete or on-track. A detailed SDS Progress Report is compiled each year and posted online at http://www.tc.gc.ca/programs/ Environment/SD/menu.htm
5. What adjustments have you made, if any?	No adjustment in 2005‑06. Minor adjustments to how performance measures are reported in commitment 2.1 (Intelligent Transportation Systems (ITS) Research and Development and ITS Deployment and Integration Plan) were made in 2004‑05 in order to gain more of an accurate status as to the progress of the targets. These adjustments are noted within the SDS Progress Report.

Table 15: Procurement and Contracting

Department/Agency: Transport Canada
Points to address:	Organization's Input:
1. Role played by procurement and contracting in delivering programs	The department uses procurement and contracting to obtain expertise in support of existing ongoing programs in areas such as informatics, auditing and language training. In addition, the department contracts for the specialized services of experts to undertake a variety of ad hoc studies and projects. This expertise is not available in-house and includes the services of consultants in the fields of finance, policy, environmental issues, science and technology, and so on. Services obtained under contract are often instrumental in ensuring that the department meets its operational requirements.
2. Overview of how the Department manages its contracting function.	The department operates in a decentralized environment with designated departmental procurement specialists in Headquarters (HQ), and the Regions who have full contracting authority. Low dollar value procurement authority has been delegated to Responsibility Centre Managers throughout the department so that they can meet most of their acquisition needs quickly and with minimal administrative burden. A few organizations in HQ also have specific limited contracting authority for specialized requirements such as the purchase of aircraft parts, vehicles and parts for testing purposes, informatics professional services and management consulting services. In addition, Transport Canada uses the services of PWGSC to procure goods exceeding $5,000 that are not available under a standing offer, and certain types of services (e.g., audio-visual production). Most Responsibility Centre Managers have use of a departmental acquisition card for purchases up to $5,000. Contracts are created using the department's automated contracting system, which is based on Oracle software. Transport Canada uses MERX, the federal government's electronic tendering system to advertise most procurement opportunities exceeding $25,000. A Contract Review Committee has been established in Headquarters and in each Region to review and challenge certain types of contracting situations such as proposed sole source contracts exceeding $25,000, unauthorized contracting actions, and some amendments. The regional Contract Review Committees are limited to reviewing contracts that do not exceed $10,000. The HQ Committee must review all the rest.
3. Progress and new initiatives enabling effective and efficient procurement practices.	Materiel and Contracting Services, part of the Administrative Services Branch, has developed a number of instruments to assist managers with their contracting requirements. These include A Guide to Procurement and Materiel Management that takes the managers through the entire contracting process from the planning stage to contract management, and Materiel and Contracting Services Bulletins on specific contracting issues. These are posted on the branch's Intranet website. In addition, the department has developed a number of training courses for managers on contracting in Transport Canada, developing terms of reference, managing contracts and evaluating bids. Materiel and Contracting Services has also developed a new procedures manual for contracting specialists in headquarters. The manual is available to contracting specialists in the regions who may wish to adapt it to reflect their own processes. Transport Canada has exceeded its targets for contracting with Aboriginal suppliers pursuant to the Procurement Strategy for Aboriginal Business for the past few years.

Table 16: Service Improvement

A survey was completed at the end of 2004 05 to measure the satisfaction of the general public, stakeholders within Transport Canada (TC), and others, with the TC external website. In response, TC launched many initiatives. The study revealed that nearly 60% of all citizen concerns relate to information/access to rules and regulations of some sort. Prevalent issues were: acts, regulations, and standards; emergencies and health and safety regulations; licensing and registration of land, air, and marine vehicles.

Building on these evaluations and through continued introduction of on-line methods of interacting with the department, TC worked throughout 2005‑06 on enhancing its citizen-focused services and its relationships with customers and suppliers, pursuant to the objectives originally set out in the Government On-line (GOL) initiative. Other client satisfaction surveys will be conducted in the future to measure how service has improved, but no firm date has been set at this time.

The following initiatives are examples of services made available in 2005‑06:

• Electronic Collection of Air Transportation Statistics (GTEC Distinction Award 2005 Gold Medal Winner)
  
  Electronic Collection of Air Transportation Statistics (ECATS) is Transport Canada's air‑transportation data-collection and dissemination software application. A joint government and industry initiative, ECATS enables air carriers serving Canada to submit essential air‑transportation data to TC via two web interfaces, reducing data-reporting costs for airlines, enhancing the timeliness and availability of air-transportation statistics for departmental decision-making, and improving dissemination of air transportation statistics to approved users of the data.
  
• 
  Transact (GTEC Distinction Award 2005 Bronze Medal Winner)
  
  Transact is Transport Canada's secure finance portal through which external clients can access the department's online storefront and e-billing website. The corporate storefront features a broad variety of multimedia products, including printed materials, videos, CDs and DVDs. It includes an online application for small commercial vessel licenses by integrating with an existing vessel database system. Over time, the storefront will continue to evolve to include a wide range of goods and services. Potential candidates include the sale of forms, examinations, inspection/certification services and registrations.
• Through Transact, Transport Canada clients also have online access to their customer account to review transaction details, print information and pay bills by credit card. Functionality is also in place to provide electronic notification of invoices and statements. This functionality is available to both private sector and government clients. Changes have been made to allow government departments and agencies to pay for goods and services on the storefront using the inter-departmental settlement process. Government clients can also use the e-billing website to view account activity, print transactions and export information to assist with reconciliation and analysis activities.
  
• 
  Continuing Airworthiness Web Information System
  
• 
  The Continuing Airworthiness Web Information System (CAWIS) is a web-based interface designed to help monitor the airworthiness of Canadian aircraft and enhance the safety of air travel in Canada. To accomplish these objectives, CAWIS enables aircraft owners and operators to submit required airworthiness data to TC via the Internet. The system also provides the department's aviation authorities with a direct, high-speed channel through which to disseminate crucial safety and other advisory information to aircraft owners and operators in Canada, and aviation authorities around the world.
  
• 
  iProcurement
  
  
• With iProcurement, Transport Canada has introduced a web-based approach to purchasing goods and services from reliable suppliers via online catalogues. This application is the first step by TC to develop a range of web-based service-delivery tools under the Business Intelligence and Resource Management Project strategy. It allows small, medium and large sized enterprises throughout Canada with an opportunity to supply goods and services to TC through an electronic mechanism.
  
• 
  Marine Safety Regulations Query System
  
  
• The Marine Safety Regulations Query System (RQS) is a web-based application that enables users to search all marine acts and regulations any time, anywhere. The system's process of guided navigation simplifies and enhances searches, making it possible for vessel owners and operators, marine-safety inspectors and the general public to locate precise information within the voluminous amount of regulation that governs marine traffic. The system was also of valuable assistance to policy makers as they performed essential regulatory development while preparing for the implementation of the renewed Canada Shipping Act in 2006.
  
• 
  Urban Transportation Showcase Program
  
• 
  The Urban Transportation Showcase Program (UTSP) is a Transport Canada initiative that aims to reduce greenhouse-gas emissions through implementation of showcase demonstrations in eight municipalities across Canada, and through dissemination of information about these demonstrations. Results of these sustainable-transportation demonstrations have been disseminated through the program's national, web-based Information Network. In addition to serving as a forum for municipal officials, transportation practitioners and other professionals to share information and lessons learned about the showcase demonstrations, the UTSP Information Network has profiled a wealth of innovative new strategies to help Canadians reduce GHG emissions produced by urban transportation.

In an effort to look for cost savings, increased productivity, consistency and a reduction in "reinventing the wheel" by all departments acting in isolation, the department has and continues to participate in horizontal initiatives. From an internal efficiencies standpoint, in April 2005, TC's Management Executive Committee endorsed the TC IM/IT Investment Plan 2005‑06 which positions key departmental IM/IT investments within this changing government landscape. In their endorsement of this plan, TC's Management Executive Committee directed the implementation of several IM/IT efficiencies in order to reallocate resulting savings to higher departmental priorities, and to implement a departmental performance framework which would allow for on-going monitoring of approved IM/IT investments as well as measure the results of these investments. As result of this work, the department attained savings/cost avoidance in the identified efficiency areas amounting to approximately $1.4 million, which was reallocated to address other departmental pressures. In addition, the IM/IT performance framework has ensured that its investments in IM/IT projects are sound.

Work continued in 2005‑06 with projects such as the Civil Aviation Issues Reporting System (CAIRS). CAIRS is a mechanism that provides external stakeholders, such as individuals, pilots, unions and the aviation industry at large) with a means to raise issues with TC in an effort to improve service delivery to all clients in the aviation field. Transport Canada Civil Aviation employees may also use CAIRS to raise issues (such as concerns, complaints, compliments and suggestions for improvement) and identify operational hazards to management. The main component for tracking and responding to these issues is a web-based application.

A solid foundation on which to build a reporting culture within the department, CAIRS seeks to address issues quickly and at the lowest possible level before resorting to more formal redress processes. While assuring users of complete privacy, CAIRS does not prevent stakeholders or employees from using any other established redress mechanisms or reporting systems. CAIRS is also in compliance with the User Fee Act, which stipulates that a regulating authority that receives a complaint on a proposed user fee must try to resolve the complaint prior to going to the next level.

Table 17: Travel Policies

Transport Canada follows and uses Treasury Board Secretariat Travel policies parameters.