ARCHIVED – National Energy Board – 2017–18 Departmental Results Report – Analysis of trends in spending and human resources

Actual expenditures

Departmental spending trend graph

Fiscal years 2015–16 to 2017–18 reflect the department’s actual expenditures as reported in the Public Accounts. Fiscal years 2018–19 to 2020–21 represent planned spending.

The overall trend in the graph above illustrates a decrease in spending from 2015–16 to 2020–21 with an increase for 2016–17 and 2017–18. The spending in 2016–17 reflects enhanced safety and oversight activity, including enhanced engagement, announced in Budget 2015. The spending in 2017–18 primarily reflects the increased cost of the collective agreement and retro payments and Budget 2017 Pipeline Safety Lifecycle Oversight.

From 2018–19 to 2019–20, overall departmental spending is planned to increase by $100,000 which is attributed to a transfer for fiscal years 2017–18 through 2018–19 from the National Energy Board to the Department of Natural Resources to support a contribution for research on promoting a safety culture in regulatory bodies. From 2019–20 to 2020–21, overall departmental spending is planned to decrease by $19.0M which is attributed to the expiration of temporary (sunsetting) funding. This includes a:

• Decrease of $13.3M in funding related to Budget 2015 Energy Transportation Infrastructure;
• Decrease of $5.3M in funding related to Budget 2017 Pipeline Safety Lifecycle Oversight;
• Decrease of $0.6M in funding related to Budget 2017 Communication and Access to Information Capacity.

The NEB is funded through Parliamentary appropriations. The Government of Canada currently recovers approximately 97% of the appropriation from the industry the Board regulates. All collections from cost recovery invoices are deposited to the account the Receiver General for Canada and credited to the Consolidate Revenue Fund.

Pipeline and power line companies regulated by the NEB (authorized under the NEB Act) are subject to cost recovery. Applications before the Board for new facilities are not subject to cost recovery until the facility is placed into service, unless the company does not have any prior facilities regulated by the Board in which case a one-time levy is assessed following the authorization of construction.

Cost recovery is carried out on a calendar year basis.

Budgetary performance summary for Core Responsibilities and Internal Services (dollars)

Core Responsibilities and Internal Services	2017–18 Main Estimates	2017–18 Planned spending	2018–19 Planned spending	2019–20 Planned spending	2017–18 Total authorities available for use	2017–18 Actual spending (authorities used)	2016–17 Actual spending (authorities used)	2015–16 Actual spending (authorities used)
Energy RegulationTable Note a	0	0	0	0	0	0	40,961,325	45,842,289
Energy Adjudication	28,225,875	28,333,982	20,000,175	20,000,175	31,553,311	24,293,849	0	0
Safety and Environment Oversight	22,559,815	22,807,608	26,151,718	26,151,718	31,877,647	23,004,346	0	0
Energy Information	5,365,717	7,289,921	4,931,394	4,931,394	8,311,633	10,444,458	6,125,216	7,190,780
Engagement	3,727,165	2,528,944	6,462,601	6,462,601	4,640,405	4,898,235	0	0
Subtotal	59,878,572	60,960,455	57,545,888	57,545,888	76,382,996	62,640,888	47,086,541	53,033,069
Internal Services	19,961,413	18,879,531	19,946,812	20,046,812	22,187,323	31,192,102	37,530,277	29,363,499
Total	79,839,985	79,839,986	77,492,700	77,592,700	98,570,319	93,832,990	84,616,818	82,396,568

Variance between 2017–18 Planned Spending and 2017–18 Actual Spending

The NEB’s Actual Spending for fiscal year 2017–18 was $14.0M higher than the Planned Spending. The increase is primarily due to the following:

• an increase of $6.6M for the wage increase in the collective agreement and retro payments;
• an Operating Budget Carry Forward of $3.8M;
• an increase of $7.3M in Supplementary Estimates primarily for Pipeline Safety Lifecycle Oversight (Budget 2017);
• a decrease of $2.9M in participant funding for the Energy East hearings.

Variance between 2016–17 Actual Spending and 2015–16 Actual Spending

The NEB’s Actual Spending for 2016–17 was $2.2M higher than the prior fiscal year primarily due to increased spending on activities supported by temporary funding announced for safety and enhanced public engagement activities.

Variance between 2017–18 Actual Spending and 2016–17 Actual Spending

The NEB’s Actual Spending for fiscal year 2017–18 was $9.2M higher than the prior fiscal year due, in large part, to the wage increase in the collective agreement and retro payments, and the Pipeline Safety Lifecycle Oversight (Budget 2017).

Actual human resources

Human resources summary for Programs and Internal Services (full time equivalents)

Core Responsibilities and Internal Services	2015–16 Actual	2016–17 Actual	2017–18 Planned	2017–18 Actual	2018–19 Planned	2019–20 Planned
Energy RegulationTable Note a	251.5	276.7	0	0	0	0
Energy Adjudication	0	0	121.2	125.7	118.3	118.3
Safety and Environment Oversight	0	0	141.2	124.5	143.2	143.2
Energy Information	48.1	37.3	41.4	55.5	36.9	36.9
Engagement	0	0	15.5	24.0	23.0	23.0
Subtotal	299.6	314.0	319.3	329.7	321.4	321.4
Internal Services	157.9	160.5	133.6	151.6	143.1	143.1
Total	457.5	474.5	452.9	481.3	464.5	464.5

Expenditures by vote

For information on the NEB’s organizational voted and statutory expenditures, consult the Public Accounts of Canada 2017–2018.

Government of Canada spending and activities

Information on the alignment of the NEB’s spending with the Government of Canada’s spending and activities is available in the GC InfoBase.

Financial statements

The NEB’s financial statements for the year ended March 31, 2018, are available on the NEB website^{Footnote 1}.

Financial statements highlights

The National Energy Board operates on a full accrual accounting basis according to Treasury Board’s policy for reporting based on generally accepted accounting principles (GAAP). The tables below provide highlights from the NEB’s Statement of Operations and Statement of Financial Position, as presented in its 2017–18 financial statements. As such, differences do exist between these tables and those presented in other sections of the Departmental Results Report, which are prepared on the modified cash basis of accounting.

Condensed Statement of Operations for the year ended March 31, 2018 (dollars)

Financial information	2017–18 Planned results	2017–18 Actual results	2016–17 Actual results	Difference (2017–18 Actual results minus 2017–18 Planned results)	Difference 2017–18 Actual results minus 2016–17 Actual results)
Total expenses	96,328,839	107,121,711	97,987,071	10,792,872	9,134,640
Total revenues	–	–	–	–	–
Net cost of operations before government funding and transfers	96,328,839	107,121,711	97,987,071	10,792,872	9,134,640

Difference between 2017–18 actual and 2017–18 planned

The department's actual net cost of operations before Government funding and transfer in 2017–18 was $10.79M more than the planned results for the same fiscal year. The net increase is primarily due to an increase of $5.2M related to retroactive payments as a result of collective agreement renewal, an increase of $1.9M related to Employee Benefit Plan, an increase of $6.3M related to Budget 2017, along with a decrease of $2.9M related to Participation Funding Program from Budget 2016.

Difference between 2017–18 actual and 2016–17 actual

The department's actual net cost of operations before Government funding and transfer in 2017–18 was $9.1M more than the previous year. The increase is primarily due to an increase of $1.8M in Participate Funding Program (related to Energy East); an increase of $3.9M in retroactive payments as a result of collective agreement renewal, an increase of $1.0M related to severance and leave allowance provision; an increase of $1.5M in professional services mainly related to data visualization, applications and a business process review; and, an increase of $0.7M amortization mainly related to IT hardware and software.

Condensed Statement of Financial Position as at March 31, 2018 (dollars)

Financial Information	2017–18	2016–17	Difference (2017–18 minus 2016–17)
Total net liabilities	34,687,036	34,259,052	427,984
Total net financial assets	24,924,941	22,656,539	2,268,402
Departmental net debt	9,762,095	11,602,513	(1,840,418)
Total non-financial assets	20,733,080	22,793,552	(2,060,472)
Departmental net financial position	10,970,985	11,191,039	(220,054)

Total net financial assets has an increase of $2.3M compared to 2016–17. The increases are mainly attributed to $3.9M related to retroactive payment accrual and a $1M inter-government transaction due to year end employee benefit plan payable set up; these increases were offset by a decrease of $2.0M related to billing adjustment and a decrease of $0.5M mainly related to OGD accounts payable. Total non-financial assets have a decrease of $2.1M compared to 2016–17, primarily due to net decrease of leasehold improvement.