Kevin Page and the Afghanistan audit

By Aaron Wherry - Friday, February 1, 2013 at 12:31 PM - 0 Comments

One of the concerns raised by Philip Cross was the Parliamentary Budget Officer’s decision in the fall of 2008 to release, during that year’s election, an analysis of the costs of the war in Afghanistan. This has also come up in the comment thread under Paul’s column.

First, the context. Parliament was dissolved on September 7, 2008. Two days later, the Ottawa Citizen reported that the Parliamentary Budget Officer, who had been planning to release an analysis of the mission that fall (at the request of NDP MP Paul Dewar), would not do so.

After six years of sending troops to Afghanistan, Canadians will go to the polls Oct. 14 not knowing how much the war has cost them. That’s because parliamentary budget officer Kevin Page, Canada’s newest spending watchdog, has decided not to release a preliminary report into the first full costing of the war since Canada sent soldiers to Afghanistan six years ago in the middle of an election campaign … Mr. Page had hoped to release a preliminary estimate when Parliament returned in September, but the election shelved those plans. There’s nothing to stop Mr. Page from releasing the study, other than concerns of interfering in the election and getting drawn into politics.

A week later, Global National pursued the question. Here is how that report began.

KEVIN NEWMAN: Well, the prime minister sought to re-assure Canadians today that Canada’s economy is on more sound footing. Banks are secure and the government claims its finances are in the black. But tonight in a “Global National” exclusive, we raise an important question that is getting almost no coverage in this campaign, how much…

JAMIE ORCHARD (Reporter): In the entire Afghanistan debate, right now, and what will be spent before the mission runs out in 2011. This small team of number crunchers has the answer to that question. They work for Canada’s first parliamentary budget officer, a new office created by the Tories to help tell Canadians what things cost. Their first job – tallying up the complete and true cost of the Afghan mission, and they’re almost ready, but the question – should it be released during an election campaign?

KEVIN PAGE (Parliamentary Budget Officer): At the minimum it would take an all-party agreement and probably we’d be setting a precedent for, in a kind of Canadian context for, you know, putting this report out.

In short order, the Liberal, NDP and Bloc leaders declared that the report should be made public. A day later, the Prime Minister added his agreement.

“We’re always willing to give content for any information that’s public. We put out detailed estimates every year of, of government expenditures so, of course, we’re willing to give our consent.”

Mr. Page then agreed that the report would be released as soon as it was ready and it was publicly released on October 9.

Mr. Page’s mandate was subsequently the subject of some gnashing of teeth. I can’t find the original source of the quote, but Cross says a former parliamentary librarian said the release of the report called into question the non-partisan status of the Parliamentary Budget Officer.

For the sake of exploring this particular moment in this history of the Parliamentary Budget Officer, I asked Kevin Page about it: Do you regret releasing the Afghanistan report during the 2008 election?

He wrote back with the following, which I reprint in its entirety. Continue…

The meaning of Kevin Page

By Aaron Wherry - Friday, February 1, 2013 at 8:00 AM - 0 Comments

Philip Cross argues that Kevin Page’s term was bad for the institution of a Parliamentary Budget Officer.

Having worked 36 years at Statistics Canada, an agency that prides itself on its independence, I have followed attentively the debates about the meaning of independence. The problem with Kevin Page and the PBO was that, to burnish their reputation for independence at their fledgling agency, they fell into the trap of reflexively taking the opposite side from the government on every issue. Page even alluded to this in an interview with Maclean’s, arguing that opposing the government’s projections was justified because “The executive is well taken care of. The question is how you close the gap for other parliamentarians.”

This is not demonstrating independence; this is a slavish devotion to an opposing position. Being independent means evaluating every situation on its merits, not the automatic gainsaying of any position the government takes, to paraphrase John Cleese. Page’s mandate was to help improve budget projections, not bolster the research capacity of the opposition.

Paul’s column from this week’s print edition acts as a good (if inadvertent) rebuttal (Paul’s column went to press a day before Cross’ column was published). But I think Cross’ assessment raises some particular questions that might be considered.

Cross is offended by Mr. Page’s comments to this magazine two years ago, specifically Mr. Page’s suggestion that his allegiance was to “other parliamentarians” as opposed to “the executive.” But to my reading, Mr. Page’s assessment isn’t terribly far from what the Conservative promised in 2006. For years, the Conservatives wrote then, the Liberal government had been underestimating the federal budget surplus. “Governments,” the Conservatives declared, “cannot be held to account if Parliament does not know the accurate state of public finances.” What to do about this? “A Conservative government will: Create an independent Parliamentary Budget Authority to provide objective analysis directly to Parliament about the state of the nation’s finances and trends in the national economy.”

So the Parliamentary Budget Officer would report to Parliament. And it was established because Parliament needs an objective  analysis of public finances. Because Government can’t be held to account unless Parliament has accurate information.

Parliament, of course, exists to hold the government to account. And it is useful to remember here that, in the present case, Parliament includes dozens of Conservative MPs who are not part of the executive.

When the office was created, its mandate was written into the Parliament of Canada Act (Section 79.2). That mandate expands on whom the Parliamentary Budget Officer is meant to assist. The Office of the Parliamentary Budget Officer fairly summarizes that mandate as follows (emphasis mine).

The mandate of the Parliamentary Budget Officer is to provide independent analysis to Parliament on the state of the nation’s finances, the government’s estimates and trends in the Canadian economy; and upon request from a committee or parliamentarian, to estimate the financial cost of any proposal for matters over which Parliament has jurisdiction.

So when Cross writes that “Page’s mandate was to help improve budget projections, not bolster the research capacity of the opposition,” he ignores the actual, legislated mandate. But he also, carelessly I think, conflates an allegiance to Parliament and parliamentarians with an allegiance to “the opposition.”

Here, for the sake of comparison, is how the Office of the Auditor General describes its mandate.

The Office of the Auditor General of Canada audits federal government operations and provides Parliament with independent information, advice, and assurance regarding the federal government’s stewardship of public funds. 

So the Auditor General scrutinizes the Government in the service of Parliament. Just recently, for instance, he issued a report that was highly critical of the Harper government’s handling of the F-35 procurement. But no one is suggesting the Auditor General corrupted his office in the process of thus serving Parliament.

The Conservatives have seemed to stress the phrase “non-partisan” when describing Mr. Page’s hypothetical successor. Cross doesn’t accuse Mr. Page of being a partisan, but he does worry that the Parliamentary Budget Officer “risks earning a reputation for partisanship.” Fair enough. But it seems to me that something needs to be made very clear here: there is a difference between being a partisan and wanting the government to be held accountable. If there is evidence that Mr. Page is a partisan—that he has an overriding and defining allegiance to a political party or even merely an overriding and defining opposition to the Conservative party—his detractors might present it. But being critical of the government does not mean someone is a partisan.

The squabbles over his mandate and reporting authority were likely inevitable given the office’s newness and prominence and the awkwardness of placing the office within the Library of Parliament. You could argue that Mr. Page has not been sufficiently demure these last five years, especially in comparison to comparable officers of Parliament. (Although you’re then objecting to style more than substance.) You might disagree, on legal grounds, with his decision to fight the government’s refusal to disclose information about its spending cuts. (Although there are lots of reasons to believe the way the government reports its spending to Parliament is broken.) You might disagree with Mr. Page’s conclusions. (As Paul writes, that’s to be expected.) But if the worst that can be said about Kevin Page is that he too enthusiastically embraced an allegiance to Parliament, he strikes me as a pretty heroic villain.

Is a rate hike worth the risk?

By Erica Alini - Monday, October 22, 2012 at 3:43 PM - 0 Comments

(Sean Kilpatrick/CP)

What’s there to see in tomorrow’s interest rate announcement by Bank of Canada Governor Mark Carney? More than one might think.

Although the BOC is sure to keep the target for the overnight interest rate at one per cent, where it’s been since September 2010, everyone will be scouring the governor’s prepared remarks looking for something that sounds somewhat like this: “Some modest withdrawal of the present considerable monetary policy stimulus may become appropriate.”

That’s a quote from Carney dating back to April 2012. It represented a clear signal to the markets that the Bank was feeling relatively good about Canada’s growth prospects and might hike rates sooner rather than later. Some version of that warning to investors has appeared in every major BOC statement since, but that hawkish tone was nowhere to be found in the governor’s most recent speech, on Oct. 15.

Instead, the governor said the Bank would give ample notice when the moment would come to think about raising interest rates again: “If we were to lean against emerging imbalances in household debt, we would clearly declare we are doing so and indicate how long we expect it would take for inflation to return to the 2 per cent target.” Given last week’s weak inflation numbers, though, it’s anyone’s guess whether tomorrow’s announcement will contain such a reference.

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Canada’s unofficial (and unelected) opposition

By John Geddes - Monday, February 13, 2012 at 10:00 AM - 0 Comments

Photo by Blair Gable

For a particular set of policy wonks—generally identifiable by the telltale pallor and redness around the eyes that come from too many hours scouring spreadsheets—the recent news that Philip Cross is leaving Statistics Canada was big. The 36-year stalwart of the federal number-crunching agency, most recently its chief economist, has long been a prized source of analysis on questions from the depth of recessions to the problems of productivity. But Cross’s exit, prompted in part by his frustration with the Conservative government’s controversial 2010 decision to cancel the long version of the Canadian census, fits a pattern that has political implications beyond arcane economic debates. He is only the latest in a string of top former public servants to join what amounts to an extra-parliamentary unofficial opposition.

In policy disputes over deficit financing or defence procurement, the government’s stance on the Middle East, or its response to an aging population, the most cogent criticism increasingly comes from independent-minded lapsed bureaucrats. Unlike university professors or think-tank researchers, former mandarins bring insider intelligence on how federal policy is really made. The civil servant colleagues they leave behind keep them up to speed on new developments. All of that can make their critiques more intriguing to the media and, for beleaguered politicians, harder to dismiss. In past eras, retirement often cut them off from timely information sources and avenues for disseminating their views. No longer. “We now have the Internet and blogging and tweeting,” says Scott Clark, a former deputy minister of finance. “All that stuff allows people to do it so easily.”

By “it,” Clark means the kind of probing analysis that he and another top former finance official, Peter DeVries, produce for their website, 3D Policy. As two of the most seasoned budget-makers in Ottawa before they left the public service a few years ago, their typically unsupportive appraisal of Stephen Harper’s approach to taxing and spending resonates in official circles. Last month, for instance, they posted a detailed deconstruction of the Prime Minister’s claim that Old Age Security was “unsustainable.” Not according to Clark and DeVries. They pointed to the government’s own projections showing that restraint already imposed on big spending items like defence and health would allow OAS to go untouched without threatening federal finances. Cross has plans for his own online newsletter, to be called Inside the Numbers.

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