Line-by-Line Audit Recommends Transformation in Expenditure Management

Ernst & Young LLP (EY) was engaged by the Treasury Board Secretariat (TBS) of the Government of Ontario to conduct a line-by-line audit of Ontario Government expenditures and expenditure growth across all ministries over a fifteen year period from fiscal year 2002/03 to fiscal year 2017/18. EY recently completed the review and submitted its report to TBS.  The title of this report “Managing Transformation: A Modernization Action Plan for Ontario” suggests the general direction of their findings.  The Government’s objective is to achieve a 4% efficiency improvement.   

Among the reports summary findings are the following:

  • Per capita spending has increased by  32% over the period
  • Increases in expenditures have outpaced population growth
  • Total provincial debt increased by 87%
  • Interest on the debt is Ontario’s 4thlargest expenditure, higher than the total operating expenditure of the total Ontario Public Service (OPS)
  • There was no real change (increase/decrease) in the OPS operating expenditures over the period
  • Real growth in Transfer Payments including to the Broader Public Sector (BPS) over the period accounts for 99.8% of the real growth in total operating expenditures
  • 90% of total operating expenditures are spent through Transfer Payment agreements
  • Significant efficiencies can be implemented that will not compromise outcomes and can in fact improve results
  • The Province must develop a better framework for public expenditure management 
  • Strong leadership will be required at the centre to strengthen coordination across the Government and its BPS partners
  • There must be a renewed focus on efficiencies across government ministries and the BPS 
  • A Modernization Action Plan should be developed to define how this will all work

For the full report, click on  https://files.ontario.ca/ey_report_2018_en.pdf