Full allocation for PBO in federal budget

Here is the word from this week's Hill Times:

After a dramatic year of struggling with the House and Senate Speakers and the Parliamentary Librarian, Canada's Parliamentary budget officer will receive the full planned $2.8-million budget he was promised, according to the 2010-2011 main estimates.

"We are very pleased that our budget is back to the original planned level," budget officer Kevin Page told The Hill Times in an email. "This will allow us to do a better job at carrying out our legislative mandate."

It's not a complete victory, though:

Mr. Young's [the Parliamentary Librarian] office said the PBO's $2.8-million funding would be maintained throughout the 2010-2011 fiscal year. Mr. Page said that "given recent history ... there should be a separate line for the PBO" under the Library of Parliament's funding.

Moreover, if you look back to the original three demands of the 'open letter', you'll note that adequate funding only satisfies one of the three demands. The other two outstanding complaints--public reporting and independence--seem to have settled down for the moment, but are not completely resolved.

But, let's call this a victory. Thank you to all of the economists and other interested citizens who supported this initiative. Collectively, I think we helped to do some good here.

I'll keep this blog up, both as an archive of the initiative and also as insurance against any future political pressure on the PBO.

So, go now in peace. We may have dispersed, but we will be watching.

Can the private sector do it?

There was some interesting back and forth through the fall about whether the private sector could fulfill the role of the PBO. I argued no.

But, in the UK, it strikes me that many aspects of what the PBO does in Canada are currently covered very well by something called the Institute for Fiscal Studies. The IFS doesn't do macro forecasting, but they do look at the budget balance on a monthly basis. They also do extensive evaluations of the annual budget, and of particular policies. The IFS is a registered charity, with very diverse funding sources.

We have lots of thinktanks in Canada, and some really interesting and well-done work comes out of them now and again. But, I think even people from our leading thinktanks would agree that none in Canada reaches the combination of academic and policy credibility that has been accumulated by the IFS. Some might come close on particular items, but not with the scale or depth of the IFS.

So, why don't we have an IFS in Canada?

In my view, an important aspect is geography. In London, you have the business, academic, and political centres of the country all accessible by a short tube ride. (Even Oxford and Cambridge are only an hour by express train.) Someone could hold office hours with students in the morning, attend a workshop over lunch at the IFS, then give a presentation to government or business officials in the afternoon--and then be home for dinner. Hard to do in Canada.

By the way, when I visited the IFS for a couple of days in the Fall I heard that the Canadian PBOfficer had been in London the previous week. The Conservatives have proposed a similar institution for the UK should they win the next election expected this year, and people in the UK are interested to hear the Canadian experience. It will be interesting to watch what happens in the UK.

(Speaking of elections in the UK, wouldn't it be cool to announce results with all candidates together in person like they do in the UK? Love those big party ribbons they wear. It would be so fun to watch the daggers emanating from the eyes of the losing candidates.)

So, to sum up, the IFS experience suggests that it might be possible for the private sector to perform many of the roles now allocated to the PBO. However, we might have to geographically shmoosh Ottawa, Toronto, and Montreal together in order to get the required convergence of factors. Moreover, the PBO is clearly doing things now that were not being provided by the private sector pre-PBO, so I don't know why we would expect the Canadian private sector to suddenly change what they do in the absence of the PBO.

An upside to not being independent?

This week, we learned that the Parliamentary Budget Officer will continue to report even though Parliament has been prorogued. In the Globe, it was reported that this is possible for the PBO because it lacks independence.

The fact that Mr. Page is able to release such reports is due to the unique structure of his office. The Parliamentary Budget Office operates as a division of the Library of Parliament. Mr. Page has expressed concern about this arrangement, arguing that he should be an independent Officer of Parliament. There are currently eight such officers – including the Auditor-General, the Privacy Commissioner and the Conflict of Interest and Ethics Commissioner.

This is a cute quirk, but it doesn't change my mind that on balance there is more to be gained from independence than being a vassal of the Library of Parliament.

Is the cheque in the mail?

In this week's Hill Times, we learn that the funding for 2010-11 hasn't been completely locked down yet. Things looked promising last week. Is no news good news?

Two weeks ago, Mr. Young [the Parliamentary Librarian] told the committee that he will recommend the Speakers ask for the $2.8-million budget for the PBO. The committee agreed. There was no talk about staffing and Mr. Young refused to answer The Hill Times' questions on that.

"It is essential that the PBO be allowed to hire within our planned budget," Mr. Page wrote to The Hill Times in an email.

"We have many projects underway for Parliamentarians that are being driven by the efforts of staff under secondment—infrastructure, budget implementation impacts, costing of sentencing reform, estimating potential output and structural budget balances, long-term economic and fiscal projections. All these projects for Parliamentarians and more are under risk if staffing is not secured," stated Mr. Page.

If I had to guess (from a position entirely out of the loop and three time zones away), I'd say that all is well. The last we heard the 2.8 million is going through and I don't see anything here that tells me differently. This article seems like more of a 'we haven't forgot about this' story from the Hill Times--which I think is useful. We haven't forgotten about it here, either.

Does the PBO offend Canada's system of responsible government?

The other day I had lunch with UBC Historian Michel Ducharme. I asked him about the argument (previously discussed here and here) that the PBO is contrary to our system of parliamentary government, or that it undermines responsible government.

I have not found those arguments persuasive, but I wanted to talk to someone who can speak from expertise. He kindly gave me a quick remedial course in parliamentary government. The thoughts below are mine--so don't blame Michel if you disagree.

The Canadian system of responsible government has at its core a close connection between the executive power (exercised by ministers through the crown) and the legislative branch (parliament). This connection comes from ministers being members of parliament, either in the House of Commons or the Senate. Ministers must command the support of the majority in the House of Commons. If they do not, they must resign. In this way, ministers (and the executive power they hold) are responsible to the people through the House of Commons. Because of this connection, there cannot be conflict between the executive and legislative branches.

Contrast this with the United States. The Treasury Secretary wants to get a budget passed. The Treasury Secretary is part of the executive, but has no role in the legislature. If the budget isn't passed by the legislature, then there is conflict. For example, the government shuts down like it did in 1995. In Canada's system, this is impossible because the same people control both the executive and legislative branches. In Canada, if a minister cannot be supported by Parliament, s/he is no longer the minister.

This is the essence of responsible government--the minister is responsible to parliament, not to a president or sovereign.

Now, on to the PBO. Does the PBO interfere with this connection of responsibility between minister and parliament?

No. The PBO provides information to all parliamentarians. This information is used by parliamentarians to help decide if they should continue to support the minister. In this way, the PBO is a tool. The PBO no more disrupts the responsibility of the minister to parliament than does a computer or a pencil. Computers and pencils help parliamentarians do a better job in deciding whether to support the minister. So does the PBO.

If, as a counterfactual, the PBO were required to sign off on the budget, then there would be a problem. In this situation, either the minister would now be responsible to the PBO (which usurps the responsibility of ministers to parliament) or the PBO would become a de facto member of the executive (which cannot be, since responsible government requires the executive to be members of parliament). Either way, this would violate important features of responsible government.

However, so long as the role of the PBO is merely informational (as it is now), then all the PBO does is to allow Parliamentarians to do a better job in their role of holding the executive to account.

So, let's review. The PBO is indeed a change to how our democracy works. But we have always evolved, so that's ok. Moreover, not only does the PBO not offend parliamentary responsibility of ministers, but by providing better information to parliament it actually enhances the notion of parliamentary responsibility that lies at the core of the Canadian system.

Budget for 2010 looking good

Good news to report from Ottawa. According to the Hill Times (subscription), it looks like the PBO will get the requested $2.8 million to run the office. (Not the Office, the office!)

A year after a nasty public fight erupted over Parliamentary Budget Officer Kevin Page's budget, Parliamentary Librarian William Young will ask the House for the PBO's requested $2.8-million annual budget in the 2010 main estimates, say MPs.

During a closed-door meeting last Thursday at the Joint Library of Parliament Committee, Mr. Young told MPs and Senators that he would recommend to the House and Senate Speakers that the Parliamentary Budget Office get the $1-million budget increase he wants in the next fiscal year, Parliamentarians told Civil Circles.

"We had a little push and pull, give and take, but at the end of the day, the meeting was constructive," said NDP MP David Christopherson (Hamilton Centre, Ont.). "We had a meeting of the minds. We had agreement on what will go forward and hopefully, at the very least, the fiscal concern around the PBO's ability to do the job as it needs to be done has been addressed and anything that surfaces between now and next year's go around remains to be seen."

So, that sounds good. How does that measure up against the demands of the 130+ economists who signed the open letter in the summer?

We call on Parliamentarians of every party to pursue the following actions in support of the Office of the Parliamentary Budget Officer:

• Ensure adequate funding to carry out its mandate
• Independence by making the PBO a full Officer of Parliament
• Public reporting of all analysis.

I'd call that one out of three. The first demand seems to be satisfied. The second, not yet. For the third, the communications of the PBO seem to be constrained by the Parliamentary Librarian, as far as I can see. But I'm happy to be corrected if I'm wrong on that.

Big decision on the PBO this week

This week, the Joint Committee on the Library of Parliament will meet on Thursday. It will be in camera, which, in a fun linguistic twist means nearly the opposite of on camera.

The Committee will discuss the Estimates for 2010-2011. Will the PBO get the $2.8 million? The Hill Times tells us it will be 'rocky'.

Kevin Page has told us he'd rather shut down the shop than run it on a shoestring.

The Government side does not have a majority on the Committee. We have seen statements of late by all Opposition parties in support of the PBO. Who will carry the day?