First

Session, 45th General Assembly

Elizabeth II, 2004

BILL 39

AN ACT TO ENHANCE THE

TRANSPARENCY AND

ACCOUNTABILITY OF THE GOVERNMENT AND GOVERNMENT ENTITIES TO THE PEOPLE OF THE

PROVINCE

Received and Read the First Time ...................................................................................................

Second Reading .................................................................................................................................

Committee ....................................................................................

December

14, 2004 Amendment

Third Reading .....................................................................................................................................

Royal Assent ......................................................................................................................................

HONOURABLE

LOYOLA SULLIVAN

Minister

of Finance and President of Treasury Board

Ordered

to be printed by the Honourable House of Assembly

EXPLANATORY NOTE

This Bill would provide for the

greater transparency and accountability of the government and government bodies

to the citizens of the province.

A BILL

AN ACT TO ENHANCE THE TRANSPARENCY AND

ACCOUNTABILITY OF THE GOVERNMENT AND GOVERNMENT ENTITIES TO THE PEOPLE OF THE

PROVINCE

Analysis

Short title

Definitions

This Act takes precedence

Categorization of government entities

Strategic plans

Business plans

Activity plans

Period covered by plan

Annual reports

Use of Corporations Act

Power to borrow and incur debt

Three year forecasts and semi-annual updates

Three year forecasts for government and

economy

Accrual accounting information

Financial information report

Non-compliance statement

Preparation of plans and reports

Government entity shall provide

information

Audits and information to the

comptroller general

Powers of minister re: remediation

Performance contracts

Regulations

Transition

Commencement

Be it enacted by the Lieutenant-Governor and

House of Assembly in Legislative Session convened, as follows:

Short title

1. This

Act may be cited as the Transparency and Accountability

Act .

Definitions

2. In

this Act

(a) "activity plan" means a 3 year plan

prepared by a category 3 government entity;

(b) "annual report" means the report

prepared annually by a government entity;

(c) "business plan" means a 3 year plan

prepared by a category 2 government entity;

(d) "chairperson" means the head of the

governing body of a public body;

(e) "chief executive officer" means the

person responsible for the day to day operation of a public body;

( f) "comptroller general" means the

Comptroller General of Finance appointed under the Financial Administration Act ;

(g) "department" means a department of

the government created under the Executive

Council Act and includes a branch of the executive government of the

province;

(h) "fiscal year" means the fiscal year

of a government entity;

(i) "governing body" means the persons who

exercise authority over or have direction and control of a public body;

(j) "government entity" means a

department or a public body;

(k) "minister" means the minister

appointed under the Executive Council Act

to preside over a department;

(l) "public body" means

(

i) a corporation, the ownership of which or a

majority of the shares of which is vested in the Crown,

(ii) a corporation, commission or body, the

majority of the members of which, or a majority of the members of the board of

directors of which, are appointed by

an Act, the Lieutenant-Governor in Council

or a minister,

(iii) a school board elected under the Schools Act, 1997,

(iv) a corporation, commission or other body that

the Lieutenant-Governor in Council may, by regulation, designate as a public body,

but does not include

(

v) a court established under the Judicature Act , or

(vi) the Provincial Court of Newfoundland and Labrador ;

(m) "responsible minister" means the

minister responsible for a government entity;

(n) "strategic direction" means the

articulation of a desired physical, social or economic outcome that would

normally require action or involvement of more than one government entity; and

(o) "strategic plan" means a 3 year plan

prepared by a category 1 government entity.

This Act takes precedence

3. Where

there is a conflict between this Act and another Act, this Act takes

precedence.

Categorization of

government entities

(1) The

Lieutenant-Governor in Council shall establish criteria for the categorization

of government entities as either category 1, 2 or 3 government entities.

(2) The Lieutenant-Governor in Council shall,

using the criteria established under subsection (1), categorize all government entities

as either category 1, 2 or 3 government entities.

(3) Notwithstanding the category into which a government

entity has been placed, the Lieutenant-Governor in Council may order the application

of a provision of this Act applicable to an entity in another category to the

entity, either in substitution for the requirement to which it would otherwise

be subject, or in addition to that requirement.

(4) The following provisions do not apply to the

Memorial University of Newfoundland:

(

a) subparagraph 5(2)(a)(i);

(b) subsections 5(3), (9), (10) and (11) but the

strategic plan of the university may be amended by the Board of Regents and in

that case a copy of the amendments shall be provided to the minister

responsible for the university;

(

c) subparagraph 6(2)(a)(i);

(d) subsections 6(3), (9), (10) and (11) but the

business plan of the university may be amended by the Board of Regents and in

that case a copy of the amendments shall be provided to the minister

responsible for the university;

(e) paragraph 7(2)(a);

(f) subsections 7(3), (9), (10) and (11) but the

activity plan of the university may be amended by the Board of Regents and in

that case a copy of the amendments shall be provided to the minister

responsible for the university; and

(g) subsections 20(2) and (3).

Strategic plans

(1) Each

category 1 government entity shall, every 3 years, prepare a strategic plan for

the government entity.

(2) A strategic plan shall

(

a) set out the goals and objectives to be met

during the period covered by the plan taking into account

(

i) the strategic direction of the government in

the area of the government entity's mandate as communicated to the government entity

by the responsible minister,

(ii) the government entity's mandate as set out in

the Act or other instrument creating it, and

(iii) the financial resources of the government

entity;

(

b) identify objective performance measures

specific to the goals and objectives set out in the plan;

(

c) set out the fiscal years covered by the plan;

and

(

d) contain the other information required by the

Lieutenant-Governor in Council.

(3) A strategic plan shall be submitted to the

responsible minister who shall approve it upon being satisfied the plan is in

keeping with

(

a) the strategic direction of the government in

the area of the government entity's mandate as communicated to it by the

minister;

(

b) the mandate of the government entity; and

(

c) the financial resources of the government

entity.

(4) A strategic plan shall include a statement

that the responsible minister, where the plan relates to a department, or the governing

body of the public body, where the plan relates to a public body, is accountable

for the preparation of the plan and for achieving the specific goals and objectives

of the plan.

(5) A strategic plan shall be signed by the

responsible minister, where the plan relates to a department, and by the

chairperson of the public body, where the plan relates to a public body.

(6) A strategic plan shall be submitted to the

responsible minister by the date set by the minister.

(7) A strategic plan shall be made public by the

responsible minister not later than 3 months after the beginning of the first

fiscal year of the period covered by the plan by

(

a) presenting the plan to the House of Assembly;

and

(

b) other effective methods, including electronically.

(8) Where the House of Assembly is not in session

at the time a plan is required to be presented under subsection (7),

section

19.1 of the House of Assembly Act

applies as if the plan were a report of an officer of the House of Assembly.

(9) A strategic plan may, subject to the approval

of the responsible minister, be amended.

(10) Subsection (3) applies to amendments made

under subsection (9).

(11) The amendments shall be made public within one

month of their approval by the minister in the manner provided for in subsections

(7) and (8).

Business plans

(1) Each

category 2 government entity shall, every 3 years, prepare a business plan for

the government entity.

(2) A business plan shall

(

a) set out the goals and objectives to be met

during the period covered by the plan taking into account

(

i) the strategic direction of the government in

the area of the government entity's mandate as communicated to the government entity

by the responsible minister,

(ii) the government entity's mandate as set out in

the Act or other instrument creating it, and

(iii) the financial resources of the government entity;

(

b) identify objective performance measures

specific to the goals and objectives set out in the plan;

(

c) set out the fiscal years covered by the plan;

and

(

d) contain the other information required by the Lieutenant-Governor

in Council.

(3) A business plan shall be submitted to the

responsible minister who shall approve it upon being satisfied the plan is in

keeping with

(

a) the strategic direction of the government in

the area of the government entity's mandate as communicated to it by the

minister;

(

b) the mandate of the government entity; and

(

c) the financial resources of the government

entity.

(4) A business plan shall include a statement that

the responsible minister, where the plan relates to a department, or the governing

body of the public body, where the plan relates to a public body, is accountable

for the preparation of the plan and for achieving the specific goals and objectives

of the plan.

(5) A business plan shall be signed by the responsible

minister, where the plan relates to a department, and by the chairperson of the

government entity that prepared it, where the plan relates to a public body.

(6) A business plan shall be submitted to the

responsible minister by the date set by the minister.

(7) A business plan shall be made public by the

responsible minister not later than 3 months after the beginning of the first

fiscal year of the period covered by the plan by

(

a) presenting the plan to the House of Assembly;

and

(

b) other effective methods, including

electronically.

(8) Where the House of Assembly is not in session

at the time a plan is required to be presented under subsection (7),

section

19.1 of the House of Assembly Act

applies as if the plan were a report of an officer of the House of Assembly.

(9) A business plan may, subject to the approval

of the responsible minister, be amended.

(10) Subsection (3) applies to amendments made

under subsection (9).

(11) The amendments shall be made public within one

month of their approval by the minister in the manner provided for in subsections

(7) and (8).

Activity plans

(1) Each

category 3 government entity shall, every 3 years, prepare an activity plan for

the government entity.

(2) An activity plan shall take into account

(

a) the strategic direction of the government in

the area of the government entity's mandate as communicated to the government entity

by the responsible minister;

(

b) the government entity's mandate as set out in

the Act or other instrument creating it;

(

c) the financial resources of the government

entity; and

(

d) the fiscal years covered by the plan.

(3) An activity plan shall be submitted to the

responsible minister who shall approve it upon being satisfied the plan is in

keeping with

(

a) the strategic direction of the government in

the area of the government entity's mandate as communicated to it by the

minister;

(

b) the mandate of the government entity; and

(

c) the financial resources of the government

entity.

(4) An activity plan shall include a statement

that the responsible minister, where the plan relates to a department, or the governing

body of the public body, where the plan relates to a public body, is accountable

for the preparation of the plan and the achievement of its objectives.

(5) An activity plan shall be signed by the

responsible minister, where the plan relates to a department, and by the

chairperson of the government entity to which it relates, where the plan

relates to a public body.

(6) An activity plan shall be submitted to the

responsible minister by the date set by the minister.

(7) An activity plan shall be made public by the

responsible minister not later than 3 months after the beginning of the first

fiscal year of the period covered by the plan by

(

a) presenting the plan to the House of Assembly;

and

(

b) other effective methods, including

electronically.

(8) Where the House of Assembly is not in session

at the time a plan is required to be presented under subsection (7),

section

19.1 of the House of Assembly Act

applies as if the plan were a report of an officer of the House of Assembly.

(9) An activity plan may, subject to the approval

of the responsible minister, be amended.

(10) Subsection (3) applies to amendments made

under subsection (9).

(11) The amendments shall be made public within one

month of their approval by the minister in the manner provided for in subsections

(7) and (8).

Period covered by

plan

8. The

Lieutenant-Governor in Council may approve a longer or shorter period for a

plan required under

section 5, 6 or 7.

Annual reports

(1) A

government entity shall each year prepare and submit to the responsible minister

an annual report on its preceding fiscal year.

(2) Not later than the date set by the

Lieutenant-Governor in Council, the responsible minister shall, every year,

make public the annual report on the preceding fiscal year for each government entity

for which he or she is the responsible minister.

(3) The annual report of a category 1 or category

2 government entity made public under subsection (2) shall compare actual

results for the applicable fiscal year of its strategic plan or business plan

with the projected results of that plan for the fiscal year.

(4) Where an annual report referred to in

subsection (3) discloses a variance between the actual and projected results of

the government entity for the applicable fiscal year of the government entity's

plan, the report shall provide an explanation of the variance.

(5) An annual report relating to the activity plan

of a category 3 government entity shall present information on the activities

of the entity carried out during the preceding fiscal year in compliance with

its mandate.

(6) The annual report of a government entity shall

include the audited financial statement of the entity, where the entity is

required to prepare one, and a comparison of it with the amount voted by the

House of Assembly related to the entity.

(7) An annual report required by this

section

shall be presented to the responsible minister not later than the date set by

the Lieutenant-Governor in Council.

(8) A responsible minister may require the government

entity submitting a report to provide additional information and the information

shall be provided within the time set by the minister.

(9) An annual report made under this

section shall

(

a) where the report is that of a department, be

signed by the responsible minister and include a statement that the minister is

accountable for the actual results reported; and

(

b) where the report is that of a public body, be

signed by the chairperson of the body and include a statement that the governing

body is accountable for the actual results reported.

(10) An annual report shall be made public by the

responsible minister by

(

a) presenting the report to the House of

Assembly; and

(

b) other effective methods, including

electronically.

(11) Where another Act requires a report to be

presented to the House of Assembly respecting the activities of a government entity

for a fiscal year, the report under this

section satisfies that requirement

subject to any additional reporting requirements established by the other Acts.

(12) Where the Act establishing a public body

requires it to prepare and make public an annual report on its activities in

the preceding year, the public body may make the report, other than a report

required under this section, public as provided for in that Act.

(13) Section 19.1 of the House of Assembly Act applies to an annual report under this

section as if the report were a report of an officer of the House of Assembly.

Use of Corporations

Act

(1) A

corporation shall not be incorporated under the Corporations Act to carry on a public purpose on behalf of the

Crown without the prior approval of the Lieutenant-Governor in Council.

(2) In giving an approval under subsection (1),

the Lieutenant-Governor in Council may determine the purpose, powers,

governance structure, and authority to borrow and incur debt of the

corporation.

(3) The minister responsible for a corporation

incorporated under the Corporations Act

to carry on a public purpose on behalf of the Crown shall prepare a statement

containing information respecting

(

a) the purpose for its incorporation;

(

b) its objects and powers;

(

c) its governance structure;

(

d) its authority to borrow money and incur debt;

and

(

e) the date of its incorporation

and shall make the statement public not

later than 4 weeks after the date of incorporation by

(

f) presenting the statement to the House of

Assembly; and

(

g) other effective methods, including

electronically.

(4) Section 19.1 of the House of Assembly Act applies to a statement prepared in accordance

with subsection (3) as if the statement were a report of an officer of the

House of Assembly.

Power to borrow

and incur debt

(1) Where

the Act, or the articles of incorporation establishing a public body, authorizes

the public body to borrow money for the purpose of carrying on its day to day

operations, the public body shall annually submit an estimate of the borrowing

requirement for the fiscal year to the responsible minister who shall obtain

approval in writing from the Minister of Finance before granting approval

himself or herself.

(2) Notwithstanding the Act, or the articles of

incorporation establishing a public body, the public body shall not borrow

money, or otherwise incur debt, for the purpose of acquiring real property for

the use of the public body, or for the purpose of erecting, repairing, adding

to, furnishing or equipping a building for the use of the public body, without

the prior approval, in writing, of its responsible minister and the Minister of

Finance.

(3) Subsection (2) does not apply to an amount

borrowed for minor repairs or minor acquisitions of furniture or equipment where

the amount is included in the amount approved under subsection (1).

(4) Subsections (1) and (2) do not apply to a

public body that is required by the Act by which it is established to obtain

the approval of the Lieutenant-Governor in Council before borrowing money or

otherwise incurring debt.

(5) Where

(

a) the Minister of Finance gives approval to a

public body to borrow money or otherwise incur debt under subsection (2); or

(

b) the Lieutenant-Governor in Council gives an

approval to a public body to borrow money or otherwise incur debt,

the Minister of Finance shall give notice

of the approval to the House of Assembly within 12 sitting days of the approval

having been given.

(6) Where the House of Assembly is not in session

at the time the Minister of Finance is required to give a notice in accordance

with subsection (5),

section 19.1 of the House

of Assembly Act applies to the notice as if the notice were a report of an

officer of the House of Assembly.

(7) For the purpose of this section, incurring

debt does not include normal trade payables.

Three year

forecasts and semi-annual updates

12. On

the day the budget is presented, the Minister of Finance shall publish a 3 year

fiscal forecast and shall, semi-annually, report on the economic and fiscal

position of the province.

Three year

forecasts for government and economy

13. On

the day the budget is presented and at other times when directed to do so by

the Lieutenant-Governor in Council, the Minister of Finance shall publish a 3

year forecast respecting the impact of policy decisions of the government and

significant economic developments on the fiscal performance of the government

and the performance of the province's economy.

Accrual

accounting information

(1) Notwithstanding the Financial

Administration Act or another Act, all government entities shall prepare

their annual budgets using accrual accounting and cash-based information.

(2) A public body shall provide the responsible

minister with the budget preparation information respecting the public body requested

by the minister and within the time requested.

Financial information

report

15. Notwithstanding

the Financial Administration Act or

another Act, all government entities shall report required financial

information in a manner consistent with generally accepted accounting

principles.

Non-compliance

statement

16. Where

a plan or report required to be made public under this Act

(

a) is not made public within the required time;

(

b) does not include all the required information;

(

c) does not present the information in the

required manner,

then, at the time the plan or report is

required to be made public, the responsible minister shall make public a

written statement giving the reasons for the non-compliance.

Preparation of

plans and reports

(1) In

preparing a plan or report under this Act, a government entity shall present

the information in a form and language that is as precise and as readily

understandable as practicable.

(2) To the extent reasonably possible,

(

a) where this Act requires information to be made

public respecting planning and respecting the reporting of results in relation

to the same matter, the information shall be presented in a readily comparable

manner; and

(

b) the information contained in a plan or report

under this Act for one government entity shall be readily comparable to the

information contained in the reports or plans of all other government entities belonging

to the same category.

Government entity

shall provide information

(1) A

minister may require a public body for which he or she is the responsible

minister to provide the information for the purpose of this Act he or she requests

and within the time he or she may require.

(2) Where a public body is required to provide

information under subsection (1), the public body shall provide the information

to the responsible minister

(

a) by the date required by the minister; or

(

b) where no date is established, as soon as

reasonably practicable.

(3) Where a public body does not provide the

information required under subsection (1) in accordance with this section, a

person authorized in writing by the responsible minister may examine the books,

records of accounts, documents and other records of the public body for the

purpose of obtaining the information.

(4) Where an examination is authorized under

subsection (3), the public body and the officers and employees of it shall take

all necessary steps to

(

a) make available the facilities and records of

the public body; and

(

b) assist in the conduct of the examination.

(5) A person shall not hinder or obstruct a person

conducting an examination under subsection (3).

Audits and information

to the comptroller general

(1) The

chairperson of a public body shall ensure that the public body engages an

auditor on a timely basis and that the audit of the public body is completed in

a timely manner.

(2) A public body shall provide the comptroller

general with a copy of the public body's audited financial statements, together

with information related to the audited financial statements the comptroller

general may request, within the time required by the comptroller general.

(3) A government entity shall, where requested to

do so by the comptroller general, provide him or her with interim financial

statements and related information within the time required by the comptroller

general.

(4) Where directed to do so by the President of the

Treasury Board, a public body shall permit the comptroller general to review

the books of account and other financial records of the public body.

(5) The comptroller general shall include, where

appropriate, and in accordance with generally accepted accounting principles, the

audited financial statements of a public body with the Public Accounts required

to be prepared by

section 59 of the Financial

Administration Act .

Powers of

minister re: remediation

(1) Where, following a review of a public body's annual report, the minister

responsible for the public body believes the public body is failing to meet the

objectives set out in its plan, the minister may make recommendations to the

public body that, in the minister's opinion, will ensure the public body's

activities are more consistent with the objectives of its plan.

(2) Where a public body does not give effect to a

recommendation of the responsible minister and does not provide reasons for not

doing so that satisfy the minister, the minister may report concerning the

matter to the Lieutenant-Governor in Council.

(3) Where the Lieutenant-Governor in Council

receives a report of a responsible minister under subsection (2), the

Lieutenant-Governor in Council may direct the public body to carry out a

recommendation of the minister and the public body shall carry out the recommendation.

Performance contracts

(1) The

responsible minister of a department shall enter into a performance contract

with the deputy minister of that department and the chairperson of the

governing body of a public body shall enter into a performance contract with the

chief executive officer of the public body.

(2) The Lieutenant-Governor in Council shall

determine the matters to be included in a contract between a deputy minister of

a department and the minister responsible for the department.

Regulations

22. The

Lieutenant-Governor in Council may make regulations to give effect to the

purpose of this Act.

Transition

23. The

Lieutenant-Governor in Council may establish different time periods within

which a public body shall comply fully with the requirements of this Act

respecting the preparation of its plans but all public bodies shall comply

fully by April

1, 2008 .

Commencement

24. This Act or a section, subsection or paragraph

of this Act comes into force on a day to be proclaimed by the

Lieutenant-Governor in Council.

Earl G. Tucker, Queen's Printer