Report on Plans and Priorities
2013-14 - Section 1

Minister's Message

As Canada's Minister of Transport, Infrastructure and Communities, I am pleased to present Infrastructure Canada's Report on Plans and Priorities for 2013-14. The report outlines our ongoing work with other orders of government to build and improve public infrastructure to support long-term economic growth and sustainability across the nation.

We understand how vital infrastructure investment is to Canadian cities, towns, and communities. World-class public infrastructure from roads and public transit systems, to water works and environmental infrastructure such as waste disposal systems is essential for economic growth and the well-being of Canadians.

That's why this government has made infrastructure funding a priority. From the 2007 Building Canada plan, to the Economic Action Plan, to the development of a future long-term plan for public infrastructure, we have worked and will continue to work effectively with other levels of government to make meaningful and lasting infrastructure investments from coast to coast to coast.

These investments are not only building and revitalizing public infrastructure, they are helping to provide jobs. Since the government launched the Economic Action Plan in 2009, Canada has more than offset the jobs lost during the global economic downturn and has achieved the strongest job growth among G-7 countries over the recovery.

In 2013-14, Infrastructure Canada will build on the momentum of our past accomplishments, and focus our work in several key areas. This includes continuing to advance work on future programs for public infrastructure that will encourage greater private-sector involvement and public-private partnerships. They will be focused on affordability and sustainability over the long term, and will provide the best value for taxpayers.

We will also continue to deliver the Building Canada plan, which is continuing to provide significant funding for provincial, territorial and municipal infrastructure through programs such as the Gas Tax Fund. This fund has been made permanent at an unprecedented $2 billion annually; ensuring municipalities have the stable and predictable funding they need to support their local infrastructure priorities.

In doing all of this, Infrastructure Canada will continue to manage programs effectively and efficiently to ensure ongoing value for taxpayers. As we continue to deliver for communities and for Canadians, I invite you to follow our progress at Infrastructure Canada.

The Honourable Denis Lebel, P.C. , M.P.
Minister of Transport, Infrastructure and Communities and
Minister of the Economic Development Agency of Canada for the Regions of Quebec

Section I: Organizational Overview

1.1 Raison d'être

1.2 Responsibilities

I. Overview

Infrastructure Canada is the main department responsible for federal efforts to enhance Canada's public infrastructure through investments in provincial, territorial and municipal assets, engagement in key partnerships with the provinces, territories, municipalities, and the private sector, and the development and implementation of sound policies. Established in 2002, the Department provides funding support to provincial, territorial and municipal governments to ensure that Canadians benefit from world-class public infrastructure from coast to coast to coast.

The Government of Canada's investments in infrastructure over the past decade have leveraged funding from provinces, territories and municipalities, resulting in a significant overall increase in spending on municipally-owned, core public infrastructure as well as on provincial and territorial assets. Significant progress has been made. The average age of core public infrastructure is declining after years of trending upwards. From its peak of 17.0 years in 2001, the average age of core public infrastructure was down to 14.4 years in 2011.

In 2007, the Government of Canada launched the $33-billion Building Canada plan, the first ever federal long-term plan for infrastructure. Through the Building Canada plan, the Government of Canada is supporting thousands of projects in communities large and small that have given Canadians and communities access to better public infrastructure, provided local economic opportunities, and strengthened the national economy.

Furthermore, on December 15, 2011, Bill C-13 entitled Keeping Canada's Economy and Jobs Growing Act received Royal Assent, legislating the $2-billion annual Gas Tax Fund allocation permanently providing a source of long-term sustainable funding that municipalities can count on for their infrastructure needs now and in the future.

In 2013-14, the Department will continue to work to advance future programming for public infrastructure. At the same time, for the 2013-14 planning period, Infrastructure Canada will continue to oversee billions of dollars' worth of investments in infrastructure projects being delivered through existing programs that support a stronger economy, cleaner environment and prosperous communities.

Figure 1: Average Age of Core Public Infrastructure

II. Programs

Infrastructure Canada's funding programs address local and regional infrastructure needs, while advancing national priorities. This, in turn, makes Canada's economy stronger, keeps people and goods on the move, and helps to make our water and air cleaner. The Department delivers funding through various mechanisms:¹

1.3 Strategic Outcomes and Program Alignment Architecture

Infrastructure Canada's Program Alignment Architecture structure has two Strategic Outcomes comprised of eight active Programs, as well as Internal Services, as detailed in Figure 2. Section II of this report provides additional detail on each program, including Internal Services, which supports all the programs.

Strategic Outcome 1 provides federal transfers to provincial, territorial and municipal governments for their infrastructure priorities in order to help maintain a high level of quality core public infrastructure across the country. Strategic Outcome 2 provides targeted project-specific investments to address federal/provincial/territorial priorities in large and small communities as well as large strategic investments of national and regional benefit. With the exception of the Gas Tax Fund, all of our programs are cost-shared with our partners, primarily other levels of government. All of our programs result in the construction and enhancement of public infrastructure, while contributing to broad federal government objectives of a competitive economy, a cleaner environment and liveable communities. These program design features are reflected in our performance measurement approach.

Figure 2: Program Alignment Architecture

* There is no planned spending for this Program beyond 2012-13. As such, it is not detailed in Section II of this report.

1.4 Organizational Priorities

Infrastructure Canada's organizational priorities for 2013-14 include the following:

Priority	Type2	Strategic Outcome(s) and/or Program
Negotiate funding agreements with partners to reflect permanent Gas Tax funding ($2 billion annually).	New	Strategic Outcome 1: Provinces, territories and municipalities have federal financial support for their infrastructure priorities.
Description
Why is this a priority? Investment in public infrastructure, including programs under Strategic Outcome 1, is in direct fulfillment of the Department's responsibility to make financial support available for public infrastructure that meets the needs of Canadians for a stronger economy, a cleaner environment and more prosperous communities. New agreements will be required to reflect permanency of the Gas Tax Fund. In total, the Department will enter into at least 13 new agreements, and provinces and territories will subsequently enter into arrangements to flow funding to thousands of municipalities. Given the timelines, it will be important to confirm the design of the program in order to undertake negotiations with partners and finalize agreements for successful implementation in 2014. Plans for meeting the priority: The Department will require Treasury Board approval for the terms and conditions of the permanent Gas Tax Fund allocation, as set out in Bill C-13, and will work with partners to renew agreements allowing municipalities across the country to continue receiving stable, annual funding for infrastructure.

Priority	Type	Strategic Outcome(s) and/or Program
Work with funding partners in the continued implementation of existing programs, while providing prudent stewardship and oversight of these programs.	Ongoing	Strategic Outcome 1: Provinces, territories and municipalities have federal financial support for their infrastructure priorities. Strategic Outcome 2: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment and liveable communities is provided.
Description
Why is this a priority? This management priority will ensure program governance including management control frameworks, documentation, monitoring, reporting tools and internal audit regimes are implemented and working effectively to ensure prudent stewardship of all program expenditures. The sunsetting of programs like the Municipal Rural Infrastructure Fund and Border Infrastructure Fund, require attention for effective close-out. Investment in public infrastructure, as per Programs under Strategic Outcomes 1 and 2, are in direct fulfillment of the Department's responsibility to provide financial support for public infrastructure that meets the needs of Canadians for a stronger economy, a cleaner environment and more prosperous communities. Plans for meeting the priority: The Department will continue to work with provincial, territorial and municipal governments to identify new infrastructure projects, commit remaining funding and advance projects through the approval and funding agreement negotiation process, while ensuring continued prudent stewardship and oversight. The Department will ensure proper file closure for projects under the Building Canada plan and sunsetting programs are completed, including, as necessary, project and program audits and evaluations. The Department will also continue to work with its partners to ensure timely completion of projects.

Priority	Type	Strategic Outcome(s) and/or Program
Renew the Shared Information Management System for Infrastructure in preparation for future infrastructure programs.	New	Strategic Outcome 1: Provinces, territories and municipalities have federal financial support for their infrastructure priorities. Strategic Outcome 2: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment and liveable communities is provided.
Description
Why is this a priority? The Shared Information Management System for Infrastructure is an important system used to support Infrastructure Canada program delivery. In the future, the Shared Information Management System for Infrastructure must become more adaptable, offer greater efficiency in program management, provide increased data quality, be technologically sustainable, and cost effective. The Government of Canada's information technology modernization strategy also calls for greater consolidation and standardization of federal information technology solutions. In addition, in support of the legislated mandate of Shared Services Canada for information technology hosting, the Department must successfully transfer the Shared Information Management System for Infrastructure hosting to Shared Services Canada and establish a new applications services model, ideally before new infrastructure programs are implemented. Plans for meeting the priority: The Department will conclude the Enterprise Data Warehouse Re-engineering project, which will increase sustainability and improve program reporting. This project is expected to deliver operational cost savings. The Department will work closely with Shared Services Canada to ensure the timely transfer of Shared Information Management System for Infrastructure to Shared Services Canada servers, and will enhance its internal capacity to deliver application services.

Priority	Type	Strategic Outcome(s) and/or Program
Work to develop future programming for public infrastructure that extends beyond the expiry of the Building Canada plan.	Previously committed to	Strategic Outcome 1: Provinces, territories and municipalities have federal financial support for their infrastructure priorities. Strategic Outcome 2: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment and liveable communities is provided.
Description
Why is this a priority? In Budget 2011, and reiterated in Budget 2012, the Government of Canada committed to work with provinces, territories, Canada's municipal sector and stakeholders to develop a future long-term plan for public infrastructure that extends beyond the expiry of the Building Canada plan in 2014. Infrastructure Canada has the lead federal responsibility for this commitment. The development of a future long-term plan may have significant impacts on all current and future Infrastructure Canada programs and may therefore impact Strategic Outcomes 1 and 2. Plans for meeting the priority: Building on discussions with its partners and stakeholders during 2012, the Department is working to advance future programming for public infrastructure. New programs will help leverage new investments in infrastructure that promote growth and prosperity, while respecting taxpayers' ability to pay.

Priority	Type	Strategic Outcome(s) and/or Program
Pursue operational efficiencies in the effective delivery of the Department's mandate – prudent management, stewardship and implementation of its current suite of programs.	Previously committed to	Strategic Outcome 1: Provinces, territories and municipalities have federal financial support for their infrastructure priorities. Strategic Outcome 2: Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment and liveable communities is provided.
Description
Why is this a priority? Maximizing operational efficiencies will ensure ongoing value for Canadians. Budget 2012 confirms the government's efforts to look for ideas on how to better administer and deliver its government programs and services. Plans for meeting the priority: Infrastructure Canada will continue to focus on prudent stewardship in the implementation of its existing programs, pursuing further cost efficiencies while working to stabilize the operational foundation of the Department. Infrastructure Canada will continue to systematically review direct program spending and operating costs to find efficiencies and reallocate funds in support of the government's overarching strategic review objective of management excellence and fiscal responsibility. As a result of the 2010 Strategic Review, the Department has identified savings opportunities to improve efficiency and the delivery of programs and services. Savings identified through the review totaled $124.5 million, comprised of administrative efficiencies, and a portion of unallocated program funding over a three-year period, concluding in 2013-14.

1.5 Risk Analysis

1.5.1 Risk Management Approach

Infrastructure Canada systematically manages a variety of risks as it advances its strategic outcomes. As new environmental risk factors emerge and risk responses are implemented, the Department continues to apply a comprehensive approach to actively identify, assess and manage risks at the strategic, operational, program and project levels. This approach includes conducting regular environmental scans to identify internal and external risk factors, direct participation of the Department's executives in identifying and assessing key risks, and the development of adequate risk responses to achieve departmental priorities and advance strategic outcomes. This information is then captured in the Department's Corporate Risk Profile and semi-annual update reports. Finally, risk management is fully integrated into Infrastructure Canada's decision-making processes, and the lessons learned from these regular risk update exercises are embedded into the Department's culture at all working levels, enhancing program efficiency as well as stewardship.

The most recent update to the Corporate Risk Profile occurred in the summer of 2012 and reflects announcements in Budget 2012 including the potential impact of a future long-term plan for public infrastructure. Risk categories are derived from the Infrastructure Canada Risk Taxonomy and ranking is based on the likelihood of the risk and impact including potential consequences and existing risk responses.

1.5.2 Departmental Risks

The new Corporate Risk Profile lists six departmental risks that represent a significant change from the eight risks presented in the 2011 risk profile. This is attributed to the close-out of the Economic Action Plan infrastructure investment programs while continuing to deliver major programs such as the Building Canada Fund. For 2013-14, the following are the three highest ranked risks to the achievement of the Department's strategic outcomes:

i) The absence of an approved multi-year operating budget may impact Infrastructure Canada's capacity to fully deliver on its mandate.

As a key risk response, and recognizing that public infrastructure is an ongoing priority for the Government of Canada, Infrastructure Canada will continue to work with Central Agencies towards a resolution of this challenge.

ii) Infrastructure Canada may be unable to quickly and efficiently address information management and information technology challenges for new programs over the planning period.

Risk responses will include the fostering of a strong relationship with Shared Services Canada and the implementation of the Electronic Data Warehouse Re-engineering project.

iii) Infrastructure Canada may not be able to accurately plan for and maintain the right mix of skills in the right positions to address its uncertain mid- to long-term strategic needs.

The Department's risk responses will be addressed through the update and implementation of the Integrated Business and Human Resources Plan to support future programming for public infrastructure and the continued implementation of the existing suite of contribution programs such as the Building Canada Fund.

1.5.3 Risk Tolerance

Senior executives at Infrastructure Canada considered their tolerance level for each risk. In undertaking this activity, risk tolerance was defined as the willingness of the organization to accept or reject a given level of residual risk (exposure). It recognizes that clarity on risk tolerance at all levels of the organization is necessary to support informed risk taking and to foster risk-smart approaches to decision-making.

For 2013-14, all six key departmental risks were designated as "tolerable". This conclusion was derived from the fact that existing and additional risk responses were deemed adequate to manage the risks. It also recognized that, in some cases, the potential occurrence of the risk rests primarily outside the Department's control.

1.6 Planning Summary

Infrastructure Canada has supported thousands of provincial, territorial and municipal infrastructure projects under our programs, including the Building Canada plan, the Green Infrastructure Fund and sunsetting programs.

The Department will continue to make significant investments in 2013-14, with forecast spending of $3.9 billion towards construction of public infrastructure across the country. In 2013-14 and beyond, Infrastructure Canada will continue to work with funding partners to implement existing programs, ensure timely completion of projects and provide stewardship and oversight as we process and pay thousands of claims for projects. While delivering on this program mandate, and on the organizational priorities outlined in Section 1.4, the Department will ensure ongoing value for Canadians – pursuing further cost efficiencies by looking for ways to better administer and deliver programs. The Building Canada plan and sunsetting programs will continue to deliver results for communities well beyond 2014.

From coast to coast to coast, the Gas Tax Fund plays an important role in advancing infrastructure renewal. In 2013-14, Infrastructure Canada will continue to make available $2 billion annually through the Gas Tax Fund, providing municipalities with predictable funding to support environmentally sustainable municipal infrastructure that will contribute to desired outcomes of cleaner air, cleaner water and reduced greenhouse gas emissions. Through legislation passed in December 2011, the federal government has made this a permanent annual investment of $2 billion per year beyond 2014 to provide greater certainty for local infrastructure planning. As current agreements for this funding conclude in 2014, Infrastructure Canada will work with provinces and territories to renew agreements to allow municipalities across the country to receive stable, annual funding for their long-term infrastructure priorities.

Infrastructure Canada will also continue to lead the Government of Canada's efforts to address the public infrastructure needs of the country. Building on a history of successful and collaborative projects, Infrastructure Canada is committed to working with partners and stakeholders to improve public infrastructure across the country. In 2013-14, the Department will continue to work to advance future programming for public infrastructure for Canada. Any new programs will aim to ensure affordability and sustainability over the long term, and provide lasting benefits to Canadians, while respecting taxpayers' ability to pay.

1.6.1 Financial and Human Resources

Infrastructure Canada's financial and human resources information over the planning period are summarized in the two tables that follow.

Financial Resources (in $ thousands)

Total Budgetary Expenditures (Main Estimates 2013-14)	Planned Spending 2013-14	Planned Spending 2014-153	Planned Spending 2015-163
3,924,706	3,924,706	3,136,440	3,014,212

Human Resources (Full-Time Equivalents–FTE)

2013-14	2014-154	2015-164
331	TBD	TBD

Infrastructure Canada's full-time equivalents are managed flexibly. Employees are readily reallocated as needed during the year to reflect specific requirements of funding programs, operational requirements and other government priorities. Operating funding is also allocated to the administration of individual programs on a similar basis.

Infrastructure Canada does not have a regular and ongoing level of A-Base funding for departmental operational costs (e.g. salaries, operations and maintenance). Up to the end of 2012-13, the Department's entire operating budget has been sourced from its programs' funding envelopes, with annual funding for operational requirements fluctuating in response to the actual oversight and management necessary for active programs. For 2013-14, an operating budget was approved based on a source of funds provided through Budget 2012. Infrastructure Canada will continue to work with the Treasury Board Secretariat and Finance Canada to confirm operating funding for 2014-15 and future years.

1.6.2 Program by Strategic Outcome and Planned Spending

The planning summary table below identifies the planned spending and strategic outcomes for each departmental program, as well as the alignment of these Programs to the Government of Canada outcomes.

Planning Summary Tables (in $ thousands)⁵

Strategic Outcome 1	Program	Actual Spending 2010-11	Actual Spending 2011-12	Forecast Spending 2012-13	Planned Spending			Alignment to Government of Canada Outcomes
					2013-14	2014-15	2015-16
Provinces, territories and municipalities have federal financial support for their infrastructure priorities.	Provincial-Territorial Infrastructure Base Fund	437,548	188,695	348,141	265,490	0	0	Strong Economic Growth
	Gas Tax Fund	1,752,697	2,206,246	2,098,236	1,976,236	2,000,070	2,000,071	Strong Economic Growth
Sub-Total:		2,190,245	2,394,942	2,446,377	2,241,726	2,000,070	2,000,071

Strategic Outcome 2	Program	Actual Spending 2010-11	Actual Spending 2011-12	Forecast Spending 2012-13	Planned Spending			Alignment to Government of Canada Outcomes
					2013-14	2014-15	2015-16
Funding for quality, cost-effective public infrastructure that meets the needs of Canadians in a competitive economy, a cleaner environment and liveable communities is provided.	Building Canada Fund-Communities Component	225,825	213,884	218,608	188,734	115,418	213,005	Strong Economic Growth
	Building Canada Fund-Major Infrastructure Component	407,499	759,828	1,130,814	942,955	612,324	547,498	Strong Economic Growth
	Green Infrastructure Fund	35,430	30,274	160,970	125,030	89,646	81,249	Clean and Healthy Environment
	Green Infrastructure Fund	336,451	188,382	379,458	289,102	266,089	170,408	Strong Economic Growth
	Municipal Rural Infrastructure Fund	146,646	88,043	57,644	78,763	0	0	Strong Economic Growth
	Border Infrastructure Fund	67,881	35,042	23,354	22,965	51,032	0	Strong Economic Growth
	Economic Analysis and Research6	1,750	3,143	0	0	0	0	Innovative and Knowledge-Based Economy
Sub-Total:		1,221,482	1,318,595	1,970,848	1,647,549	1,134,509	1,012,160

Strategic Outcome 3 (Historic)	Actual Spending 2010-11	Actual Spending 2011-12	Forecast Spending 2012-13	Planned Spending			Alignment to Government of Canada Outcomes
				2013-14	2014-15	2015-16
Construction-ready infrastructure projects are provided with federal funding support7 (Includes timely, targeted and temporary stimulus programs under the 2009 Economic Action Plan, which were implemented between 2009 to 2011).	2,790,799	771,049	0	0	0	0	Strong Economic Growth
Sub-Total:	2,790,799	771,049	0	0	0	0

Planning Summary Table for Internal Services (in $ thousands)

Program	Actual Spending 2010-11	Actual Spending 2011-12	Forecast Spending 2012-13	Planned Spending
				2013-148	2014-158	2015-168
Internal Services9	49,26510	55,52510	35,43010	35,43110	1,861	1,981
Sub-Total:	49,265	55,525	35,430	35,431	1,861	1,981

Planning Summary Total (in $ thousands)

Strategic Outcomes, Programs and Internal Services	Actual Spending 2010-11	Actual Spending 2011-12	Forecast Spending 2012-13	Planned Spending
				2013-14	2014-15	2015-16
Total	6,251,791	4,540,110	4,452,655	3,924,706	3,136,440	3,014,212

1.7 Expenditure Profile

1.7.1 Spending Trends

In 2013-14, Infrastructure Canada has planned spending of $3.9 billion on infrastructure investments under its programs to meet the expected program results and contribute to its strategic outcomes.

Figure 3: Departmental Spending Trend

1.7.2 Variations in Program Spending Trends

In 2011-12, significant effort was dedicated to the scheduled closing out of two timely, targeted and temporary programs the Department was responsible for under the Economic Action Plan (EAP): the Infrastructure Stimulus Fund (ISF) and the Building Canada Fund-Communities Component Top-Up (BCF-CC Top-Up). At the same time, the Department continued to implement programs under the Building Canada plan.

Since 2009-10, the Department's spending continued to increase, peaking in 2010-11 with the implementation of the ISF and the BCF-CC Top-Up. From 2010-11 to 2013-14, the level of spending declines as the programs under the EAP were completed in 2011-12 (with the exception of the Green Infrastructure Fund, which extends beyond 2013). Beyond 2013-14, the Department will continue to flow funding towards the implementation of its existing programs under the Building Canada plan as well as the Green Infrastructure Fund. In addition, this graph does not include spending for future infrastructure programming as financial details are not yet available.

1.8 Estimates by Vote

For information on our organizational votes and/or statutory expenditures, please see the 2013-14 Main Estimates publication. An electronic version of the Main Estimates is available at: 2013-14 Main Estimates.

1.9 Contribution to the Federal Sustainable Development Strategy

The Federal Sustainable Development Strategy outlines the Government of Canada's commitment to improve the transparency of environmental decision-making. The strategy outlines key strategic environmental goals and targets, and ensures that they are considered in decision-making.

Although Infrastructure Canada is not one of the 27 departments required to table a Departmental Sustainable Development Strategy or to report on its contribution to the Federal Sustainable Development Strategy, it continues to play an important role in helping create a more sustainable future.

The Department's broad range of infrastructure programs supports thousands of projects across Canada that contribute to a cleaner environment in areas such as drinking water, wastewater, clean energy, public transit and brownfield redevelopment. Many of these infrastructure investments directly support two of the Federal Sustainable Development Strategy Themes:

1. Maintaining Water Quality and Availability.
2. Addressing Climate Change and Air Quality.

Beyond providing funding through federal infrastructure funding programs, Infrastructure Canada's measures support the Federal Sustainable Development Strategy's Theme 4, Shrinking the Environmental Footprint – Beginning with Government. The Department continues to implement its recent Greening Action Plan, which includes measures in green procurement, waste and energy reduction and awareness and promotion. More details on our green procurement initiatives can be found in the Supplementary Information Tables on Greening Government Operations, on Infrastructure Canada's website at: Infrastructure Canada Publications.