lovince of lih Columbia ANNUAL REPORT 1981 Ministry of Finance For the year ended December 31,1981 Honourable Hugh A. Curtis, Minister British Columbia Cataloguing in Publication Data British Columbia. Ministry of Finance. Annual report. — 1980- ISSN 0229-0626 1. British Columbia. Ministry of Finance. HJ13.B72 354.711'062'068 Copies of this document may be obtained from: Information Services ffi Ministry of Finance F'arliament Buildings Victoria, British Columbia V8V 1X4 The Honourable Henry R Bell-Irving, D.S.O., O.B.E., E.D., Lieutenant Governor of the Province of British Columbia MAY IT PLEASE YOUR HONOUR: I have the honour, Sir, to submit the Annual Report of the Ministry of Finance for the year ended tfecember 31, 1981. Hugh A. Curtis Minister of Finance The Honourable Hugh A. Curtis Minister of Finance Parliament Buildings Victoria, British Columbia Sir: I have the honour to submit for your consideration the Annual Report of the Ministry of Finance for the year ended December 31, 1981. L. I. Bell Deputy Minister of Finance IliSTRY OF FINANCE flERS lister HONOURABLE H. A. CURTIS iuty Minister's Office L 1. BELL Deputy Minister R. A. MESSENT Executive Coordinator rmation Services C. L. TEMPLE Director nomics and Policy D. I EMERSON Assistant Deputy Minister A. EASTWOOD Executive Director, Financial Policy and Analysis D. M. HYNDMAN Acting Director, Short Term Planning and Analysis J. G. YOUNG Acting Director, Financial Analysis R J. ADAMS Director, Tax and Fiscal Policy L. A. BLAIN Director, Economics and Statistics D. E. ALLEN Director, Social Policy and Federal-Provincial Relations J. BAINBRIDGE Special Advisor, Social Services usury Board Staff K. 0. SADDLEMYER Deputy Secretary C. S. HUTCHINGS Assistant Deputy Secretary, Budget Policy and Administration M. H. LEENDERS Director, Administrative Policy E. 1 MUNRO Assistant Deputy Secretary, Services to Government D. M. ANHOLT Assistant Deputy Secretary, Social and Health Services 1 Revenue Office of the Comptroller General 11 D. J. SANDELL Assistant Deputy Secretary, Education and Training Services W. D. MITCHELL Assistant Deputy Secretary, Justice and Regulatory Services I G.HALKETT Assistant Deputy Secretary, Natural Resource and Economic Development W. H. BELL Senior Advisor, Personnel Resources K. M. LIGHTBODY Assistant Deputy Minister A. B. CARVER Acting Director, Income Taxation C. E. HOLDER Acting Surveyor of Taxes, Real Property Taxati E. J. TURNER Executive Director, Consumer Taxation N. MOGENSEN Director, Revenue Administration and Collectio D. R. ALEXANDER Comptroller General D. B. MARSON Deputy Comptroller General R. L. RUTHERFORD Executive Director, Financial Policy Implementation D. M. HENDERSON Director, Professional Support R. C. CORBEIL Acting Executive Director, Financial Policy I Development M. A. PETRIE Executive Director, Financial Analysis and« Reporting J. R. COATES Administrative Coordinator FG. HEPBURN Executive Director, Internal Audit rsury and ciinistration u.hasing Commission 'nincial Capital "omission W. E. EVANS Director, Financial Disbursement Operations G. L. TOMALTY Director, Establishment Control A. C. PICKERING Director, Central Accounting A. R. HORNER Director, Government Payroll and Personnel H. G. FERGUSON ^Assistant Deputy Minister R M. O'NEILL (resigned November 30,1981) Director of Investments A. D. THOM Investment Officer, Long Term Investment R. W. VIPOND Investment Officer, Short Term Investment D. G. PEARCE Acting Director, Cash Management T E. SUMNER Acting Director, Central Borrowing K. E. LITTLER Director, Securities and Administration K. PROWSE Special Assignment C. C. BARMAN Acting Controller, Management Services R W.WILKINSON Director, Data Processing G. I BRODIE Director, Government Agencies T F CUTHBERT Director, Personnel and Payroll A. W. CHARLTON Chairman K. PLANT Administrator G. L. GILES Chief Executive Officer INTRODUCTION The Annual Report of the Ministry of Financ ai intended as a review of the ministry's activiW during the calendar year 1981. It is not intende|l be a financial statement but rather it is a repor jja the functions and achievements of the various cm sions within the ministry. Quarterly Reports on the finances of the ProviiU are published separately throughout the fiscal y fill A detailed look at the Province's finances itfcH provided in the Budget, the Public Accounts, }\ Estimates, and the Financial and Econoin Review. This Annual Report reflects a numberfl organizational changes that have taken pi;; within the ministry as a result, in part, of the pJ sage of the Financial Administration Act in 19,1 There are five divisions in the ministry, e;i| headed by an Assistant Deputy Minister report; to the Deputy Minister who in turn reports to i Minister of Finance. The five divisions are: • Economics and Policy • Treasury Board Staff • Revenue • Office of the Comptroller General • Treasury and Administration Operating outside the divisional structure but < porting on administrative matters to the Depn Minister are: • Purchasing Commission • Provincial Capital Commission Both the Purchasing Commission and the Prov cial Capital Commission are responsible to | legislature of British Columbia through the Minis of Finance. The Executive Coordinator for the ministry and t Director of Information Services also report direc to the Deputy Minister. aw UTY MINISTER'S ESAGE If the year 1980 can be described as one of examination, then 1981 can quite rightly be looked upon as one of accomplishment. Reorganization of the ministry is complete, and a system for measuring the effectiveness and efficiency of all ministry branches was instituted. In addition, the long and complex process of documenting procedures and policies was initiated. This activity has provided the basis for launching an active program to increase efficiency and effectiveness through the examination of existing procedures. Lengthy negotiations with the federal government on the Established Programs Financing Act were concluded. Further important work remains with respect to the Tax Collection Agreement. The Financial Administration Act was proclaimed and implementation of administrative policies and procedures governing financial operations throughout government commenced. This task will take at least three years. A new accounting policy was developed, which will see a significant improvement in the format of the Public Accounts. Major reforms were undertaken to automate the budget process and simplify the Estimates. Further simplification and refinement is required for Treasury Board directives and the budget process. A major challenge in the future will be the integration of both the capital and operating budgets. Revenue Division commenced work on a very complex, but important task of compiling all fees and licence charges throughout government. It is anticipated that this task will take two to three years to complete. An education program to improve tax compliance was initiated. Investment management continued to obtain real returns significantly above inflation. In addition, improvements to our banking procedures and cash management reduced costs and increased revenues. The Government Agency system continued to increase its level of service despite constraints on manpower resources. As well as serving the internal requirements of the ministry, the Data Processing Branch continued to keypunch and transmit to British Columbia Systems Corporation on the request of 18 ministries. The ministry was well served by its support staff in Personnel and the Controller's Office. All these tasks and many more required a significant degree of dedication and sacrifice by a highly skilled and motivated staff. 1 ECONOMICS AND POLICY DIVISION Social Policy and Federal-Provincial Relations Branch Economics and Statistics Branch As a strategic policy and planning unit, the £. nomics and Policy Division advised the govs: ment on fiscal, financial and economic matters iji provided a framework for the government's eval. tion of policies and priorities throughout 1981. Early in the year, the division was reorganizecfl meet increased government needs for medii. term fiscal planning, and analyses and forecast! f financial and economic affairs. The division's major policy objectives in 1981 we: • to contribute to the maintenance of a sou fiscal position for the Province through tp{ sis and advice; • to recommend timely implementation of & nomic policies appropriate to emerging!) tional and international conditions; • to improve the provincial fiscal position duri renegotiation of the Federal-Provincial Fis Arrangements and Established Programs nanclng Act, 1977; • to review the provincial tax system with t aim of ensuring the equitable distribution tax burden; • to assist in the development of policy on i proved financial planning and financial trols in the Financial Administration Act, a • to assist in preparation of the 1982 Provinc Budget Speech and to produce the assp ated Background Papers. In 1981, the Social Policy and Federal-Provmc Relations Branch helped develop and coordinE British Columbia's position on the renegotiate the Federal-Provincial Fiscal Arrangements a Established Programs Financing Act, 1977. Tl branch prepared the brief presented to the Parli mentary Task Force on Fiscal Arrangement June 1981 and carried out a major study of federal-provincial fiscal programs. The branch also completed fiscal analyses of social program and policy proposals made to cal net during 1981. The Economics and Statistics Branch provided i economic context to fiscal planning for tl Province through periodic medium-term econorr and fiscal forecasts and through the monitorii and analysis of the British Columbia and intern incial Policy and to lysis Branch fa and Fiscal 'ccy Branch tional economies. The branch played a major role in coordinating the fiscal and economic review of cabinet submissions, and was responsible for preparation of the 1981 Financial and Economic Review. A major initiative of the branch in 1981 was development of a new computer hardware and software system for the division. An econometric model for forecasting major Province revenues was put in place, as were systems for accessing data bases on Canadian and foreign economies. The Financial Policy and Analysis Branch monitored the fiscal position of the government during 1981. Through its short-term planning and analysis section it also provided advice on methods of meeting budgetary objectives. The branch's financial analysis section analysed the capital investment of the Province and its Crown corporations. The branch also prepared the government's Quarterly Financial Reports, and played a substantial role in the drafting of the Financial Administration Act. The Tax and Fiscal Policy Branch was responsible for the evaluation of all proposals concerning taxation policy, fiscal policy and provincial-municipal fiscal relations. The branch collaborated with the Ministry of Education to prepare the 1981 School Taxation Report—Report of the Committee to Examine the Effects of Rapid Rises in Home Owner Real Estate Values on School Taxation. The branch contributed to the federal-provincial fiscal arrangements negotiations with a review of the Province's Income Tax Collection Agreement with the Government of Canada. The revenue measures contained in the 7982 Provincial Budget were developed by the Tax and Fiscal Policy Branch which also prepared the biannual fiscal framework, an internal document used for budget planning purposes. The efficiency and effectiveness of the Economics and Policy Division were measured beginning in May 1981, chiefly according to timeliness and accuracy of the division's various outputs. From May to December 1981, the division completed 591 assignments of which 6 per cent were recorded as overdue and .2 per cent as unsatisfactory. Over the same period, 2 per cent of the major routine outputs for which the division was responsible (e.g., economic and fiscal forecasts, financial and eco- 1 nomic reports, fiscal planning documents) vi/i recorded as unsatisfactory. Comparison wiffll staff and budget required by Alber Saskatchewan and Ontario for similar fungll were also taken into consideration. The resafsfl the comparison for 1981-82 are shown below;! COMPARISON OF DIVISION TO FUNCTION J COUNTERPARTS IN OTHER PROVINCfel 1981-82 Division or Functional Counter Budget as of ProaB Budget .0216 I Province British Columbia.. Saskatchewan Ontario Alberta Number of Staff 451 35 127 28 .0546 .0286 .0165 1 Including 27 permanent and 18 auxiliary positions.! Treasury Board Staff, throughout 1981, continued in its role of providing support to the Treasury Board. The principal objectives of the Treasury Board Staff Division throughout the year have been: • to monitor and improve administrative efficiency in government, • to advise on and implement expenditure restraint as necessary, and • to provide advice and information to assist Treasury Board in establishing government spending priorities. In addition, Treasury Board Staff was responsible for: • coordinating and administering the resource allocation program throughout government, • preparation of the annual estimates of expenditure, and • formulating Treasury Board's decisions affecting government ministries and communicating them in the form of policy directives, procedures and guidelines. During 1981, Treasury Board Staff provided the following major services: • extension of zero-base budgeting principles to all ministries. During the 1982/83 budget process, the Ministries of Health, Education, Human Resources, Intergovernmental Relations, and Transportation and Highways adopted zero-base budgeting principles, bringing to 19 the number of ministries now following the zero-base budgeting system. • preparation of an integrated Budget and Administrative Policy Manual tor use by all ministries. This is the first such government manual prepared in Canada to combine budget and administrative policy and procedures. Treasury Board Staff also advised on the management of government resources, and on government organizational structures in a corporate context under the Financial Administration Act. The public service hiring freeze and accompanying restraints on consulting contracts and on staff travel were implemented in August 1981 by the Chairman of Treasury Board following preparatory studies by Treasury Board Staff. CO < o J Q ^ CC cc < o O co £ >- cc D Q UJ < s UJ p cc (0 f- UJ V) s-O p O Q. (0 5 Q-DC < CO "O c o 5 £ 0) CO a (0 CO 0) O) o> 3 (0 E ■o < 10 ilget and Administrative [icy Branch A Treasury Board directive to all government ministries concerning user fees and licences was issued in June 1981, prepared by Treasury Board Staff. A study of the fee and licence structure of the provincial government by the Finance Ministry's Revenue Administration Branch continues. The Budget and Administrative Policy Branch of Treasury Board Staff undertook several projects to improve the resource allocation process in government during 1981. These included: • development of a detailed budget timetable and introduction of a computerized budget preparation system used by government ministries in preparation of the 1982/83 Provincial Budget. This Interactive Estimates System has produced marked improvement in the quality and speed of budget preparation and review. • creation of a monthly budget monitoring and reporting process, introduced in 1981, applicable to all ministries, and to be further developed in 1982. • development of a new structure for the Province's estimates of expenditure, with the aim of improving disclosure to the public and increasing the ministries' flexibility and accountability. Publication of the 1982/83 Estimates will reflect the revised structure. • development of a computerized, multi-year forecasting system to estimate the longer- term funding requirements of all government ministries. • development and introduction of risk management service to safeguard the assets of government. The service received approval from Treasury Board late in 1981 for implementation in 1982. Administration of the government-wide Suggestion Awards Program which began operation January 1, 1981, is carried out by the Budget and Administrative Policy Branch. Government employees at all levels are invited to submit suggestions which would streamline government procedures, lower costs or otherwise increase the efficiency of government operations. Awards take the form of cash and certificates. In November 1981 the Minister of 11 1 Policy Field Branches 12 Finance announced an increase in the maxim! award that can be made under the Suggefl Awards Program from $500 to $10,000, based i the cost-saving value of a suggestion to the gc ernment. A total of 339 suggestions were receivi in 1981 and reviewed by the inter-ministr9§ judication committee. Eight suggestions have i suited in cash awards, totalling $2,550, while thn merit certificates were issued under the progra The five Policy Field Branches of Treasury Boa Staff provided advice and analysis to Trealsii Board at the time of budget presentations ar when requested, on ministry submissions for | terations or additions to resource allocafjo throughout the year. The branches are: • Services to Government • Social and Health Services • Education and Training Services • Justice and Regulatory Services • Natural Resources and Economic Development. In each branch, analysts from Treasury Board St are assigned responsibility for individual minim As well, the Policy Field Branches provided tech cal advice, and advice on policy interpretation all ministries on issues related to resource alloc tion in general and on budget preparation particular. Major initiatives of the branches included:H • development and implementation of thej phase of a Capital Budgeting Program fort four major capital spending ministK Health; Education; Universities, Science a Communications; and Attorney General • major independent analyses of governrru program thrusts and resources requngg effect government initiatives including a ft year operational plan for the Ministry of F ests, and the examination of financing optic for B.C. Place, North East coal developme the B.C. Ferry Corporation and the Min3y Municipal Affairs Revenue-Sharing Fund study of public schools and post-second; education for the Ministry of Education n r carried out to provide control and flexibility in managing manpower resources. • development in 1981 of a business case methodology for the 1982/83 budget year to identify the total costs and benefits associated with specific new systems projects. The branches also analysed the financial implications of federal-provincial agreements and their impact on government services, with specific reference to the provisions of the Financial Administration Act. These agreements included the Canada Assistance Plan involving the provincial Human Resources Ministry, and the Canada-British Columbia Industrial Development Sub-Agreement'm- volving the provincial Ministry of Industry and Small Business Development. The Policy Field Branches also analysed the financial impact of public sector wage negotiations in cooperation with the Government Employee Relations Bureau. The efficiency and effectiveness of the division is measured by adherence to the approved budget timetable, the general satisfaction of Treasury Board and the cabinet, and production of the Estimates of Revenue and Expenditure (the Blue Book) before budget day. In 1981 Treasury Board Staff was able to meet these guidelines. During the year 70.3 per cent of the 1,573 Treasury Board submissions received from ministries were dealt with within 10 working days of receipt; 15.7 per cent within 20 working days, and 15 per cent within 50 working days. By year end 1,476 submissions had been vetted; 97 remained for consideration and forwarding to Treasury Board, at that time. The estimated average cost of processing a Treasury Board submission is $300. This is comparable with several other Canadian governments: Processing Cost per Submission Federal Government $550 Alberta„ 300 Manitoba 200-250 British Columbia 300 13 REVENUE DIVISION Consumer Taxation Branch 14 1\ During 1981, the four branches of the Revent Division administered the taxation statutes that a I the responsibility of the Minister of Finance. Tf statutes include those covering property taxation rural areas of the province, taxation of consffij goods, and taxation of personal and corpora) income. The specific aims of the Revenue Division durir the year included: • collecting taxes in an efficient, effective ar equitable manner; • enhancing compliance with taxation statute • improving audit and inspection performanc within the branch, and • improving tax collection and administratic through development *of more effectk systems, procedures and organizatic structures. It was also the division's goal in 1981 to reduce tf amount of litigation and the number of public cor plaints centered on provincial tax levies and increase compliance with taxation statutes ar regulations through taxpayer education. A major step towards these goals was the estal lishment of the Revenue Administration Branci part of a general reorganization of the division; Total revenues collected by the division in 196 were $4,006,749,710, up 25% over 1980 collei tions of $3,189,851,764. See Table on page 2 The activities of the Consumer Taxation Brant included the registration of taxpayers and the auc and inspection of taxpayers' records under the fc lowing seven statues: • Social Service Tax Act • Hotel Room Tax Act • Tobacco Tax Act • Gasoline Tax Act • Gasoline (Coloured) Tax Act • Motive Fuel Use Tax Act • Horse Racing Tax Act Revenue collected under these statutes in 1981 rose significantly overthat collected in the previous I Percentage 1980* 1981 Increase $1,020,814,637 $1,478,876,918 44.9% * Revenue collected in 1980 included $774,343 collected under the Fuel Oil Tax Act which was repealed in March 1980. All heating fuels were taxed at VzQ per gallon under this Act. Now only heating fuels used for commercial purposes are taxed under the Social Service Tax Act. The branch's success in ensuring compliance with the seven taxation statutes during 1981 was measured by the administrative cost of collections, the length of time required to process new vendor registrations and to recognize delinquent accounts, and by the proportion of vendor accounts overdue. The responsibility for the collection of seriously delinquent tax revenues under the seven consumer tax statutes shifted in early 1981 to the newly created Revenue Administration Branch. The cost of administering the taxing statutes was held to less than $.41 per $100 collected throughout 1981, which compares favourably to costs of collection in other provincial jurisdictions. The interruption of federal postal service in 1981 interfered with the prompt registration of new vendors and with the early recognition of delinquent accounts. The efficiency of the Consumer Taxation Branch in carrying out its audit function during 1981 was measured by the amount of revenue raised by each of the branch's 60 auditors and by the relation of the audit payroll to the total amount of revenue recovered. The amount raised by each addition is as follows: Recovery per Auditor 1980 $219,588 1981 $266,715 Per Cent Increase 21.5% Audit payroll was to be no more than 12 per cent of total recoveries resulting from the audit efforts of the branch during 1981. Ratio of Audit payroll to audit related revenue recovery 1978 11 per cent 1979 10.7 per cent 1980 11.6 per cent 1981 10.02 per cent 15 The effectiveness of the Consumer Taxat Branch in carrying out the audit function duij 1981 was hindered by difficulty in recruiting ai| staff. Ideally, each large vendor should be audi) once every 10 years to check for compliance un the taxation statutes; a total of 2,800 audits she) be performed each year at current staff levelS] 95 per cent of completed audits should be forjjil assessed within 10 days of completion. In 1981 > number of audits completed both in total and i auditor were the highest ever, as was the totaBJ of taxes assessed as a result of this effort. S table on page 18. A total of 68,052 tax collectors were registered; the Consumer Taxation Branch at the end of 19 up 5 per cent from the 1980 level of 63,8401 tered collectors. Of the 1981 total, 63,853 » registered under the Social Service Tax Act u per cent from 1980. There are 13 Consumer Tax Field Offic throughout the province, as well as the one in \ toria. Both auditors and inspectors are locatec each of these offices. (See map on page 17). NSUMER TAXATION BRANCH OFFICES % -Hjl • Dawson Creek Prince Rupert • 9 Prince George \ *: • Williams Lake 0 Kamloops • Vernon Campbell River* Penticton Vancouver 9 9 Nanaimo* * • Nelson ChilliwacK^ @ Cranbrook Victoria 0 17 Real Property Taxation Branch CONSUMER TAXATION BRANCH—AUDITS lncre.8 £ Total audits completed 1981 1978 2,573 °veM98° 1979 2,368 1980 2,721 1981 2,944 8.2% Average number of audits per auditor 1978 47 1979 47 1980 48.2 1981 49.2 2.1% Total taxes assessed as a result of audits ] 1978 $11,019,224 1979 11,101,827 1980 12,400,162 1981 15,944,219 28.6% Taxes assessed per audit 1978 $4,282 1979 4,688 1980 4,557 1981 5,416 18.8% The Real Property Taxation Branch collected i\ administered taxes and special levies on taxa* real property lying outside incorporated mun- palities in British Columbia. In 1981 as in 1980, t; rural area made up more than 98 per cent oh land area of the province as well as 20 per centoli net taxable values and approximately 20 per ol of its population. The 1981 rural taxation roll contained 285,000; accounts, covering net taxable values' $2,569,000,000 under the Taxation (Rural At) Act and $3,476,000,000 under the School Act(v. table page 20). The branch administers the Taxation (Rural Art Actthe Land Tax Deferment Act and, in rural are. the Home Owner Grant Act. The branch also lev; taxes on rural properties under the follow I statutes: 18 • School Act • Municipal Act • Hospital District Act • Assessment Authority Act • Municipal Finance Authority Act • Local Services Act • Library Act • Esquimalt and Nanaimo Railway Belt Tax Act • University Endowment Lands Administration Act • Agriculture Land Development Act • Grasshopper Control Act • Mobile Home Tax Act • Farm Distress Assistance Act • Highway Scenic Improvement Act • Riverbank Protection Act • Weed Control Act • Islands Trust Act. The Land Tax Deferment Program enables certain owners including seniors and some disabled property owners to defer, or delay, payment of taxes on their homes until the property is either sold or passed on. The deferred taxes carry a compound interest of eight per cent per annum. In 1981, there was a significant increase in the tax deferrals under this act, resulting from significant increases in market value assessments of property. No. of Cumulative Year Property Taxes Full Tax Deferment Partial Tax Deferment Total- Property Taxes Agreements Agreements Deferred 1974$ 460,000 610 1072 $ 388,000 1975 481,000 515 456 755,000 1976 452,000 600 240 1,042,000 1977 447,000 659 168 1,425,000 1978 656,000 885 129 2,027,000 1979 646,000 981 94 2,526,000 1980 792,000 1073 79 3,202,000 1981 2,235,000 1985 64 5,511,000 19 REAL PROPERTY TAXATION BRANCH Year Number of Rural Tax Accounts 1977 256,000 1978 266,000 1979 272,000 1980 278,000 1981 285,000 Total Rural Property Taxes Collected (in Millions) 1977 20.7 1978 19.1 1979 21.8 1980 25.4 1981 29.2 Net Taxable Value, Taxation (Rural Area) Act (in Millions) 1,587 1,589 1,847 2,175 2,569 Local NelT^r Value School, (in Millio 2,211 2,mi 2,7011 2,94! 3,47f Total School Government cE Taxes Collected (in Millions) 101.0 120.5 133.6 153.1 197.3 Taxes Collected* (in Millions) 21.5 24.7 27.1 32.2 38.9 Taxes Collect 1.5 1.7 1.8 2.0 2.5 *This includes Improvement District, Regional District, HospitattBis Library District and similar levies. Home Owner Grants in Rural AreCT 1981 1980 Applications 86,352 80,489 75,412 72,408 .... 69,620 Total Grants $33,900,000 33,000,000 29,800,000 23,200,000 21,500,000 Increas 10.3°/ 11.1°/ 1979 12§°/ 1978 10.8°/ 1977 11.2°/ The branch's success in carrying out tax collecti in rural areas was measured by the administrati cost for each tax account. In 1981, the costw $3.12 per account, below the target cost figure $3.24 per account and comparable to the coa incurred by the municipalities of Surrey aj Saanich. In administration of the Home Owr Grant to rural area property owners, the bran was deemed efficient when the cost for each a proved application was $1.30 or less. Cost f approved application in 1981 was held to $1.2 The efficiency measure for the branch's rolel administering the Land Tax Deferment Progra was a cost of $11 or less per tax deferment i count. The branch's servicing cost per accognt 1981 was $10.94. In each of the branch's three functions—real property tax collection, Home Owner Grant administration and the Land Tax Deferment Program—the branch's effectiveness was measured by adherence to the annual work cycle, which was sucessfully met throughout 1981. The Income Taxation Branch was responsible for administration of the following statutes in 1981: • Corporation Capital Tax Act • Mining Tax Act • Logging Tax Act • Insurance Premium Tax Act • Income Tax Act. Under the Tax Collection Agreement between the provincial and federal governments, the federal government collects personal and corporate income taxes on British Columbia's behalf. The Income Taxation Branch has statutory responsibility for the British Columbia Income Tax Act and assists Revenue Canada in the compliance and informational aspects of the taxing statute. The branch is also responsible under the provincial Fire Services Act for collection of tax from insurance companies which sell fire insurance. As well, during 1981, the Income Taxation Branch continued the administration of certain provincial legislation which has been repealed, but for which tax revenue for the period prior to repeal is still being collected. These statutes are: Date of Repeal January 24, 1977 January 24, 1977 March 11, 1980 Succession Duty Act Gift Tax Act Probate Fee Act British Columbia Payment to Canada of Federal Income Tax on Behalf of Natural Gas Producer Act December 31, 1976 A tax roll totalling 15,925 individuals and corporations was maintained by the Income Taxation Branch, made up as follows: 14,150 Corporation Capital Tax 1,100 Logging Tax 125 Mining Tax 550 Insurance Premium Tax. 21 Three of the branch's 15 audit positions remai j vacant throughout 1981, as a result of confflj difficulties in recruiting qualified audit staff. The branch was responsible for registration of p ical parties and their signing authorities under Income Tax Act, and for auditing political dorialj claimed under this legislation. Seven politicM ties were registered by the branch in 1981.H Liberal Party in British Columbia British Columbia Social Credit Party New Democratic Party of British ColuU Progressive Conservative Party of Brill Columbia Western Canada Concept Western National Party Taxpayers and Voters Party of Britisl Columbia. During 1981, the branch collected a to $149,609,000 of revenue, up only 4 per cent fn the amount collected in 1980 of $144,250,349. T marginal increase is accounted for by the four pealed statutes listed earlier and by factors affe ing the forestry and mining sectors of the provinc economy. 1981 revenue was, however, 10.5 [ cent higher than the expected revenue total $135,400,000. The branch's success in 1981 in ensuring co pliance with the taxation statutes for whicHit responsible was measured by the admini'sllti cost within the branch, by the proportion of active tax roll filing tax returns voluntarily, and the margin of planned revenue within which acti revenue fell. The compliance cost was held $.005 per dollar of revenue generated, well witi the guideline of $.27 per dollar generated. T Income Taxation Branch was considered effecti in ensuring compliance if 70 percent or more of f active tax roll filed tax returns voluntarily, and actual compliance revenue from those filing volu tarily came within 10 per cent of what was | pected. In 1981, 76.3 per cent of the branch's t roll filed voluntarily, and compliance revenue $1,133,000 was 14.7 per cent higher than thee pected $965,000. The efficiency of the Income Taxation Branch carrying out its audit function in 1981 wi measured by the audit cost, intended to be 15 p tnr cent or less of total audit recovery. In fact, the branch's total audit cost throughout the year of $579,000 was 6.24 per cent of the $9,274,695 total audit recovery. Difficulty in obtaining audit staff in 1981 caused the branch to fall short of its target of 8,500 audits; 7,964 audits were completed by the branch's 12 auditors throughout the year. Audit revenue in 1981 totalled $9,274,695 or 7 per cent higher than the planned audit revenue figure of $8,750,000. Branch costs of $585,000 were .39 per cent of branch revenue of $149,609,000 for the year, well within the target of .75 per cent or less. Further, while the actual branch cost figure was 6.6 per cent higher than the planned cost figure for 1981 of $552,000, it was within the 10 per cent target set for branch effectiveness. /enue ninistration nch The Revenue Administration Branch was established in 1981 to provide administrative, tax accounting and collection services for the three preceding sections of the Revenue Division. The new branch assumed general administrative, tax record-keeping and collection functions from the Consumer Tax Branch early in the year; similar functions for the two remaining branches will be assumed in 1982. The Revenue Administration Branch recruited staff during the summer and fall of 1981 in preparation for full operation in 1982. The branch is scheduled to assume revenue-collecting functions for all assessed and seriously overdue taxes for the Real Property Taxation Branch in early 1982, and for the Income Taxation Branch in the fall of 1982. The new branch provides a higher profile in the field of tax collection and is expected to reinforce compliance with the provincial tax statutes. When fully in operation in 1982, the Revenue Administration Branch will be responsible for receiving more than one million tax returns annually. Special initiatives taken by the Revenue Administration Branch in 1981 included: • a study of all fees and licences levied by the provincial government. More than 1,400 individual fees and licences were listed in an inventory by the end of 1981. The branch's involvement in the project will continue in 1982. The aim is re-evaluation of government- 23 imposed fees and licences in terms of i 1981 Treasury Board directive which e* lished the objective of basic cost recovffll the provision of many of these serviceM • planning and development of a collecti system for all taxation statutes for whidffil ministry's Revenue Division is responslbl The system was implemented in 1981 on t following consumer taxation statutes: I —Social Service Tax Act —Hotel Room Tax Act —Tobacco Tax Act —Gasoline Tax Act —Gasoline (Coloured) Tax Act —Motive Fuel Use Tax Act —Horse Racing Tax Act. • development of a collection system for tl Income Taxation Branch was begun and 5| continue in 1982. • a continuing project to design systen capabilities for provincial income taxation ai property taxation records was undertake The Revenue Administration Branch was succes ful in fulfilling the functions of collections and a ministration (mostly relating to the Consumer Tax tion Branch) set for it in 1981. These functions vJ be expanded to include the areas of provinc income taxation and real property taxation in 196] with specific efficiency and effectiveness me sures set for the branch's operation. REVENUE BY STATUTE—REVENUE DIVISION Statute 3dal Service tax Act lei Room Tax Act bjcco Tax Act Jidline Tax Act Sne (Coloured) Tax Act * ve Fuel Use Tax Act „,...;. I(3e Racing Tax Act I1 Oil Tax Act1 nme Tax Act (Federal)— ^onal Income Tax2 Borate Income Tax2 cging Tax Act ling Tax Act ooration Capital Tax Act urance Premium Tax Act ii Services Tax Act 'riate Fee Act1 ii Tax Act1 IfSssion Duty Act1 Wmh (Rural'Area) Act ool Act ©^Services I^roperty Taxes and Fees I Calendar 1980 Revenue $701 pJaPPPl 14,725,936 71,027,089 161,459,747 33,725,154 27,857,140 9,269,589 774,343 1,287,000,000 526,000,000 58,039,393 18,460,981 52,000,000 15,763,926 1,758,943 417,065 10,394 2,336,425 23,100,000 151,300,000 32,000,000 850,000 Total $3,189,851,764 rlepealed. i Province of British Columbia Estimates. Calendar 1981 Revenue $1,037,505,422 22,012,363 95,709,817 216,948,579 67,180,581 35,378,266 4,141,890 1,578,000,000 532,000,000 21,450,000 15,750,000 80,400,000 28,850,000 2,725,000 57,252 6,540 434,000 29,300,000 197,400,000 39,000,000 2,500,000 $4,006,749,710 Percentage Increase Over 1980 47.8 49.5 34.8 34.4 99.2 27.0 (55.3) (100.0) 22.6 1.1 37.0 (14.7) 54.6 83.0 54.9 (86.3) (37.1) (81.4) 26.8 30.5 21.9 194.1 25.6 25 OFFICE OF THE COMPTROLLER GENERAL Deputy Comptroller General T The Office of the Comptroller General verified gc ernment expenditures, and maintained centra!i counting, reporting and payment systems for tl government. This division also provided an intfr audit function for the independent review cm efficiency and effectiveness of financial coJSi systems in the government. The Response to t 1980 Report of the Auditor General and the tv volume Public Accounts 1979-80 were publish and the three volume Public Accounts 1980-i were prepared by the Office of the Comptroll General. The objectives of this division in 1981 inclffi • advising Treasury Board on government a counting and financial administration poM • enhancing public understanding of tt Province's financial operations and poMJc through government financial reports ifflp ing the Public Accounts; • increasing the effectiveness of the goven ment's internal audit function; and • ensuring timely payments to governmentsu| pliers and employees. During 1981, the Deputy Comptroller Generl completed his duties as a member of the task ford appointed by the Minister of Finance to review tl Financial Administration Act. Prior to its passage the legislature in June 1981, he coordinated tl activities of various ministry and inter-mirWt working groups associated with the developmel of the act. Under his direction, regulations required by the a were developed and presented to Treasury Boaj and subsequently approved by cabinet in Noveij ber 1981. A comprehensive set of governme financial administration policies required by the a was developed and prepared for publication intl Treasury Board Financial Administration Polk Manual. Staff of the Deputy Comptroller General also • assisted ministries in implementing new pc icies for financial signing authorities, • evaluated and incorporated necessary final cial controls in 17 developing financial terns throughout government, and • prepared the government's official response! the 1980 Report of the Auditor Genera^ 26 Throughout 1981, the Deputy Comptroller General maintained communication with other ministries on financial policy, systems, controls and other related matters through regular meetings of the council of ministry executive financial officers and the council of ministry senior financial officers. The Financial Administration Act and the Financial Administration Policy Manual were developed during the year and approved on schedule. The policy development operation did not formally exist before 1981 so cost comparisons are not possible. In 1981, 64 policy implementation projects were established of which 60 were completed on schedule. This resulted in an effectiveness rate of 93.8 per cent, exceeding the branch's target of 90 per cent. The cost per policy implementation project declined from a starting average of $1,530 to $1,275 at the end of the year. This represented a 16.7 per cent improvement in efficiency. During the year, the branch addressed itself to 87 outstanding recommendations made by the Auditor General in her 1980 report. At December 31, 1981, 31 of the issues had been satisfactorily resolved and a further 50 had progressed toward a satisfactory resolution. This resulted in an actual 93.1 per cent effectiveness rate, exceeding the branch's target of 80 per cent. The cost per response to the recommendations declined from an opening monthly average of $70 to $66 at year end. This represented an improvement of 5.7 per cent in efficiency. The 1980/81 Public Accounts, which included consolidated financial statements and information under both the old cash basis and the new modified accrual basis of accounting, were prepared and transmitted to Treasury Board and the Auditor General by the September 30 statutory deadline. Adjusted for inflation, the Public Accounts, which included additional schedules and financial information not previously published, were produced at approximately the same cost as the year before. In 1981, monthly statements were completed on average by the fifth working day of each month. Average costs for producing them was the same as for the previous year. 27 Pay and Personnel Accounting Branch The Pay and Personnel Accounting Branch v responsible for the payment and control of persi nel costs to government in 1981. Throughout the year, this branch: • maintained employee records of more th 60,000 persons employed by the prowc government in 1981; • managed the provincial government payn valued at an average of $80 million moltl (see chart); • paid on average 45,000 provincial govei ment employees per month, and • processed 80,000 pay-related and tra\ vouchers per month, including, on aveta 15,000 employee travel expense vou« Major improvements were introduced to redu processing costs in the handling of 21,000 Ca^a Savings Bonds, valued at more than $7 rSc Improvements were also made to the handling provincial government employee absencajii sickness cost records the value of which totall< more than $210 million in 1981. The Pay and Personnel Accounting Brani developed a system to permit ministries on-lii access to personnel management data during tl year. By the end of 1981, six ministries—Enviro ment, Health, Attorney General, Transportatk and Highways, Provincial Secretary, and F nance—had adopted this system which providi more timely dissemination of personnel manag ment information. The branch also began an extensive review of tl provincial government payroll systems to mal them more responsive to the needs of manag ment and to the requirements of labour agre ments and government personnel manageme policies. In 1981 payroll processing and personnel manag ment edits were cleared and the systems balanct by established cut-off dates. Unit processing cos were not maintained during the year. However, tf total operating cost for both functions was appro imately $930,000 in the fiscal year 1980/81, whk was approximately 15 per cent lower than tl 1979/80 cost of $1.1 million. 28 Government Payroll as a Proportion of Total Government Expenditure JAN-DEC 1981 1981 Government Employee Payroll (monthlyaverage S80million) Smillions 89 88 87 86 85 84 83 8? 81 80 79 78 77 76 75 74 73 7? 71 70 Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec 29 Vouchers Received in 1981 in 000's 65 60 55 50 45 _§j I_, 40. 35. 30 Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec 30 i icial Disbursement Hffions Branch Pay and personnel accounting systems integration and maintenance were effective if existing systems were planned, specified, implemented and tested, and met stated system release dates. They were efficient if operating cost savings, improved functions, and reporting or information requirements were within the systems release budget. Four systems releases were planned, specified, implemented and tested in 1981 by the stated system release dates. In addition to the improvements that were made in payroll processing and the personnel management systems, policy changes relating to unemployment insurance and Canada Savings Bond employee deductions resulted in savings to government of approximately $100,000 in 1981. Systems releases were developed within budget. The Financial Disbursement Operations Branch was responsible for: • processing all non-personnel disbursements, and • issuing all government cheques, as well as documentation and control of all transactions processed through the government's central accounting system, and the pre-audit of all non-personnel payment vouchers. In 1981, the branch: • processed 580,000 payment vouchers valued at more than $6.5 billion. • rejected 13,000 incomplete or inaccurate vouchers valued at $171.1 million. The percentage of vouchers rejected dropped from an average of 2.3 per cent at the beginning of 1981, to an average of 1.6 per cent by year end, indicating an improvement in voucher processing by ministries. • issued more than three million cheques. • processed receipts for a total transaction value of more than $26 billion, including $19.5 billion in investment transactions and interest earnings. The branch's pre-audit operation was considered effective if the average time from receipt of vouchers to the submission for processing was five working days. The operation was efficient if the unit cost of documents verified was lower than for the previous year. 31 32 Percentage of Vouchers in Error in 1981 % ? =; A r-tn L m ^ ?.o ^ 1.5 1.0 0.5 | 0 Jan Feb Mar Apr May June July Aug Sept Oct Processing Cost per Voucher in 1981 in $ 2.-55 Nov Dec 2.50 9.45 2.40 2.35 2.30 2.25 2.20 2.15 2.10 2.05 2.00 1.95 1.90 1 85 1.80 1 75 1.70 I 1.65 ■ 1.60 1 5.=. Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec rnal Audit Branch i ral Accounting sen While the average processing time during 1981 did not meet the standard, indications for the first quarter of 1982 show an average processing time of five days. Since unit processing costs were not maintained in 1980, a target of $2.04 per voucher was established in 1981. At the end of the year, the unit cost was $1.98 per voucher. The Internal Audit Branch conducted appraisals during 1981 of government financial controls and management systems. The branch also audited major financial systems "under development" and audited and certified more than 1,400 claims, valued at more than $270 million, made by British Columbia under federal- provincial cost-sharing agreements. During 1981, the branch conducted throughout government: • 35 regular audits, • 8 special audits, and • 4 systems development audits. A major initiative of the branch was the development of internal audit policies and of a five-year internal audit master plan covering the fiscal years 1982-83 to 1986-87. The plan provides a coordinated and comprehensive approach to the internal audit of government operations. It also ensures that each audit unit is reviewed at least once every five years. During 1981, the operations of the Vancouver office of the Internal Audit Branch were consolidated with those of the Victoria office as an economy measure. Generally, audits were completed on time and in accordance with an established plan. The audit reports took an average 28 working days to prepare after completion of the audit. The productive hourly cost in 1980 was $38.90, while in 1981 the average cost rose to $41.63. This small increase in cost per productive hour of $2.73, or 7 per cent, was due to the significant temporary reduction in staff resulting from the Vancouver office closure in June. The Central Accounting Branch maintains the general ledger of the Province of British Columbia, including a central record of revenue, expenditures, assets, liabilities and trusts. 33 Suitors' Fund Estate Administration.. The branch also maintains the records and , proves payments related to funds held in trust the government. These include funds paid tc court pending the outcome of a suit, estates whi there is no next of kin or named trustee, and fur held on behalf of infants or those unable to ham: their own affairs. Trust funds maintained by Cental Accounting gn from $119.4 million at the beginning of the year, $161 million at year end. The breakdown follow January 1 December 1981 1981 ($ million) 39.6 59.4 . 79.8 1TJL6 119.4 161.0 Central Accounting verifies all expenditures ps through Government Agents on behalf of tl Comptroller General. By means of auditing ai reconciling, the branch also controls revenue fro courts, the Government Agents and other relati bank transfers. In 1981 Central Accounting set out to improve i performance in a number of areas. The branc worked to improve revenue classification and n porting, and tightened accounts receivable contr by arranging for a number of ministries to age the receivables. By redesigning systems, Central Accounting al; eliminated or condensed approximately 25 pi cent of financial management and control repor for responsibility centre managers. To speed i report distribution the branch arranged to trgKr the information electronically to printing centre around the province. The branch also made significant progress in er suring that all collections and expenditures ( monies held in trust by the government were ident tied, classified and reported. In 1981, there was, on average, no significantback log at the month end cut-off in either the gener; ledger or Government Agent verification operatior Since 1980 costs were maintained on a differer basis from those of the subsequent year, a $1 pe unit transaction benchmark was set for 1981. Th> average cost of processing documents during th year was $.95, while the unit cost of verifying docu ments averaged $.62. In the trust fund operation, funds were disbursed within four working days on average in 1981. Since unit costs per client serviced were not maintained in the previous year, a target of $1 per client was established for 1981. The average unit cost for the year was $.77. 35 Tl TREASURY AND ADMINISTRATION Treasury Branch 36 Treasury and Administration manages the Conm dated Revenue Fund and trustee funds, whiojl 1981 totalled $8 billion, and provides adminiil tive and technical services to the Ministfflfo Finance, other government ministries, Crown coi porations and the public. There are five branches! the division: • Treasury Branch • Controller's Office • Personnel and Payroll • Systems and Data Processing • Government Agencies Treasury Branch manages the Province's majc financial assets and liabilities and is also responsi ble for non-budgetary financial activities. TR include banking and cash management, Crowi corporation capital funding, investment operations and securities and administration. The branch responsible as fiscal agent for the managemen and arrangement of Crown corporation borrow ings, for the administration and financial aspects c advances and guaranteed loans, and for the de velopment of a broad range of government IjBi cial arrangements. The Treasury Branch undertook a far-reaching ex amination of its operations during 1981 am brought about changes to reflect more effectivi delivery of service. This was necessitated by significantly increased demand for banking are money market activities on the part of the Crowi corporations, and in recognition of the need fo more efficient operations generally. The Banking and Cash Management Section o the branch performs banking, cash flow forecas and accounting duties. In 1981 the section con ducted a cash management study which resultei in cash savings and an improved cash manage ment program. The section also designed and be gan work on a cash management monitorinaffs tern. All revenue accounts were included in ai accelerated transfer program which improved uti lization of provincial funds. In 1981, banking operations were efficienjpi effective since all deposits were made on time will zero-error performance. The section maintajm-i more than 800 bank accounts and accepted ai average 3,500 deposits per month from all g(ffin ment ministries. r All reports for the cash flow forecasting operation were timely and accurate and bank account credit balances averaged 1.7 per cent during the year. The Capital Funding Section assisted in accessing the public capital markets for British Columbia Hydro and Power Authority bond issues totalling $1.3 billion. Of these bonds, $250 million were floated in the Canadian market, $950 million in the American, and $100 million (payable in U.S. dollars) in the European market. The section helped arrange the Province's first bond issue in the United States private placement market on behalf of five Crown corporations. The issue totalled $53.3 million. Capital Funding also arranged short-term financing for a number of Crown corporations through provincial trusteed accounts totalling $488,500,000 in 1981. The section coordinated Canada Pension Plan financing for hospitals; schools; colleges and universities, and other Crown corporations totalling $340,798,000. As well, the section coordinated the preparation of documentation for all borrowing, including prospectus preparation for three public issues and one private placement. In 1981, reports and issue documentation for public, short-term and Canada Pension Plan borrowing operations were timely and accurate. The cost ratio to amount borrowed for this section was 1.7 to 3.8 times lower than for three other provincial borrowers. Treasury Branch's Investment Operations Section is sub-divided into short- and long-term investment management groups. Short-term investments as of December 31,1981 were approximately 35 per cent of total investments, up from 10 per cent at December 1980. In 1981, the short-term investment group managed $3 billion, up from $2 billion in 1980, and consisting of sinking funds, pension funds, consolidated revenue funds and special purpose funds. These funds were re-invested approximately four times throughout the year for a total volume of $12 billion invested. Active management of all portfolios increased dramatically in 1981. Not only were terms varied, but switches were made involving differences in yield spreads and marketability of investments. There were 8,200 transactions in the 37 year with an average size per transactidSi $1,500,000. Short-term investments were effective if they di not adversely affect the market and efficient if the were an average of five basis points above th market. In 1981, investment operations metbot these criteria. The group's short-term market pe formance was 34 basis points (.34 per cent) abov the market average during the year. In 1981, the long-term investment group manage $4.2 billion consisting of sinking funds, pensio funds and special purpose funds. There were 38 transactions of which the average size wa $187,000. At December 31, 1981, long-ternfir. vestments made up approximately 65 per cent c the total investment pool, down from 90 per cent ii December 1980. Investments for the B.C. Sefpc Districts Capital Financing Authority sinking fund! were realigned to provide a better match to thi issue due dates. Activity in the Canadian are American public bond markets was continueaii 1981, in order to maintain liquidity for outstandin; B.C. debt issues and to meet sinking fund require ments. Finally, the group executed extenavt trades in long-term securities where the term tt maturity of the purchased bond was either reduce* or remained unchanged. In all cases an increase ir yield to maturity was obtained. To be efficient, the long-term investment group hac to achieve an average yield on purchases of 3 pei cent above the inflation rate; execute trades with e shortening of term and a 25 basis points (.2a|ei cent) improvement in yield; and maintain theyielc spread between British Columbia Hydro and On tario Hydro. Efficiency was achieved in 1981 wttna 3.10 per cent real return on purchases, a shorten ing of term and an average improvement in yiel&ol 37 basis points, and a reduction in the yield splgd between Ontario Hydro and British Columbia Hydro of 4 basis points (.04 per cent) over the year. The Securities and Administration Section en hanced the existing accounting and inventory system and developed a computer program for debt servicing of the Capital Financing Authorities^ 1981, these debt servicing payments totalled more than $230 million. Total securities held in safekeeping by the section were in excess of $12.5 billion. Securities also assumed control of shares and as- IIBer's Office sets of companies in voluntary liquidation, which in 1981 totalled approximately $2 million. During the year the section maintained a 59 per cent saving over commercial rates for the same services, and carried out its activities in a timely and accurate fashion. In 1981, the Treasury Branch had responsibilities under the following acts: Financial Administration Act Pension (Public Service) Act Pension (Municipal) Act Pension (Teachers) Act Hydro and Power Authority Act Pension (College) Act B.C. Railway Act B.C. Railway Finance Act Funds Control Act Special Funds Act Resource Investment Corporation Act Hospital District Finance Act School Districts Capital Financing Act Municipal Act Greater Vancouver Regional Water and Sewer District Act Educational Institutions Capital Finance Act. During 1981 the Controller's Office continued to assist the ministry with advice and information on the budget process. The office also provided facilities and office services management. Two new sections were added to the Controller's Office during the year to provide procedures and forms management, and word processing services. The office also coordinated the development of an efficiency and effectiveness reporting system across all divisions and branches of the ministry to ensure that operations continually responded to measurable objectives. As well, the office administered the Transmission Line (Underground) Act which provided grants to municipalities and public utilities for underground installation of power, telephone and other transmission lines. In 1981, five projects were funded for a total of $362,400. The Facilities and Office Services Section was responsible for ministry space occupancy. In 1981, the section arranged for new premises for Revenue Division's 180 staff members, for 39 members of Treasury Board Staff, and for the 47 members of Internal Audit. The section also assisted in relocating one Government Agency office, and upgrading 39 II three others. In 1981, this section producec* work on time and within budget. The cost per. ployee per month was $4.29. The Procedures and Forms Section began opi. tion in September 1981. The section providec. search, editorial and production assistance fo | ministry policy and procedures manuals. Irj1:| these included the Financial AdministratiorWt Manual and Digest, the Budget and Admini§m\ Policy Manual, and the Central Services Polm, Procedures Manual. The section also managei forms generated in the ministry, which in n numbered approximately 500. This section produced timely and accurate m uals and forms recommendations in 1981. f scribed turnaround times were met and anr savings from forms redesign were document Redesign proposals made by the section are pected to save the ministry more than $7O,O0( 1982. The Office Automation Centre was another sect which began operation in 1981. It was develop mid-year to provide the ministry with advara word processing capability. The centre facilita routine document file applications and correspi dence production while allowing clients to avoid need for overtime and added staff. In 1981, the Automation Centre met its implems tation plan targets, achieved less than oneerroi 10 pages 75 per cent of the time, and produc documents up to five pages long in one day, 75 f cent of the time. The cost per page was apprc imately 50 per cent below the $3.50 bencfm* figure established for the operation. The Budget and Expenditure Control Secti provided advice and information on the zero-ba budgeting process, and coordinated preparation the ministry's 1982/83 budget estimates. These tion also accounted for all 1981/82 Ministry of nance expenditures. Efficiency and effectiveness measures were put place to monitor the vouchering and budget! aspects of the section. In 1981, the error rate for the section was lessth: two per cent and the staff cost per voucher w $4.63 at the end of the year. Effectiveness in budgeting was measured by adherence to the budget cycle schedule. Efficiency was achieved if a staff cost of $71 per person per month was met or bettered. In 1981, the section met the budget cycle schedule and had a staff cost of $39. The Transmission Line (Underground) Act and the Capital Commission Act were administered by the Controller's Office in 1981, while the Municipal Aid Actwas a shared responsibility with the Ministry of Municipal Affairs. inel and Branch During 1981 the Personnel and Payroll Branch continued to provide the ministry with organizational analysis, job position analysis, staffing services, labour relations representation and formalized ministry training and development programs. On April 1, as a result of the ministry reorganization, Personnel became responsible for the ministry payroll services. The branch recruited 474 employees for regular positions and 448 auxiliaries for variable terms in 1981. Vacancies and positions during the year resulted from: Promotions 136 Resignations 171 New Positions 65 Transfers to other ministries 46 Retirements 20 Other Reasons 36 At December 31 the Ministry of Finance had 1,282 employees of whom 60 per cent were female and 40 per cent male. The number of handicapped persons employed by the ministry was increased from 27 to 32. The branch also completed 250 classification and job analysis studies related to the ministry reorganization and established a training centre in October. At year end the training centre was delivering on-going multi-media programs to ministry employees and had organized two three- day management training courses and two one- day supervisory techniques programs. Personnel and Payroll also resolved 17 grievances without recourse to arbitration in 1981. An orientation brochure for new employees was distributed and 26 ministry employees received 25-or 35-year service awards. 41 Tl Systems and Data Processing Branch In 1981 ministry employee recruitment increai 15.6 per cent for regular positions and 16 per ct for auxiliary over 1980 figures. Recruitment co averaged $110 per capita during the year."! recruitment operation was considered effe<§vf 95 per cent of positions were encumbered witfiiri days of being advertised. In 1981 Personnel u Payroll was able to meet this requirement: ']> training centre provided 84 employees rnVrmt- tional training in the three months of its existefL 1981. The Payroll section, with only two fulltirtSe. ployees, met all payroll deadlines while map;, ing an error rate of less than one-half of one cent. In 1981 Personnel and Payroll had responsSlJ under the following acts: • Public Service Act • Public Service Labour Relations Act 1 • Workers Compensation Act • Maturity Protection Act • Human Rights Code • Ombudsman Act • Labour Code • Employment Standards Act • Financial Administration Act • Unemployment Insurance Act • Income Taxation Act • Public Service Superannuation Act. The Systems and Data Processing Branch is i sponsible for coordinating the development of re computer systems for the ministry as well as tl operational management of all ministry productii systems in the financial area. This includes i sponsibility for system coordination betwei BCSC and users, data control of all input and oi put of the system, and remote job entry for outside ministries, several Crown corporations ai the Ministry of Finance. During 1981, developmental and operational a plications within the Ministry of Finance in#df the following systems: General Accounts Bank Reconciliation Estimates 42 Revenue Taxation Corporation Capital Tax Motor Fuel Use Tax Government Agents Cash Registers Real Property Tax Levy Real Property Tax Accounts Receivable Public Service Payroll Miscellaneous Pay Leave Management Securities Investment Securities Authorities Billing Securities Sinking Fund Analysis Securities Liabilities Supplies Trust Accounts Corporation Capital Tax Investment Payments Transmission Line (Underground) Act System VM/CBS Timesharing Applications and Management Systems In addition some aspects of the GAIN and Social Assistance programs were produced for the Ministry of Human Resources. In 1981 the Systems Management Section of the branch acted as the intermediary between service users and B.C. Systems Corporation design and programming staff. The section monitored hardware and systems costs for new and existing projects thus keeping branch expenditures well within budget. By using various software packages, Systems Management was able to respond effectively to an increased demand for ad hoc reports in 1981. The section also coordinated developmental projects including the automation of Consumer Taxation's accounts receivable system, the enhancement of Real Property Taxation's levy system, the Securities Authorities billing system and completion of phase one of the Government Agents cash register project. During the year Systems Management performed a feasibility and functional analysis for a cash management system, installation of which was on time and within budget. The section also began a feasibility study for an integrated cash flow forecasting system. Finally, Systems Management provided the branch director with monthly expenditure reports for development and production systems, assisted the Purchasing Commission with word processing file management and gave advice on Administration's IBM 5520 system in the Automation Centre. 43 <i_ 1 The Data Control Section scheduled and prepM production jobs for presentation to the Cotjnpji Operations Section. The section managed qu control, bursting, decollating and distributionoe printed output. By eliminating the use of punc( cards in favour of computer terminals and cedures libraries, the section reduced the §m\ of errors in job submissions by 80 per cent in 1 The Computer Operations Section mainBI computer interface system with BCSC's rn frame computer 24 hours a day, five days aw< This interface system processed 2,000 jobs month during the year, with 20 million lines of pi ing per month on average. The Finance Data Entry Section keyed iiiffisil lion records per month for virtually all branchia the ministry, for the B.C. Ferry Corporation, an) the Ministries of Education and Human Resouis The Central Services Data Section acted as a i vice bureau for key entry and work from almon government ministries and some Crown corps tions. The section also provided a back-up sei> to the Finance Data Entry section. An averati 2.5 million records a month were keyed in for • B.C. Buildings Corporation • B.C. Systems Corporation • Liquor Distribution Branch • Ministry of Agriculture and Food • Ministry of Attorney General • Ministry of Consumer and Corporate Ad • Ministry of Economic Development™ • Ministry of Education • Ministry of Energy, Mines and Petroli Resources • Ministry of Environment • Ministry of Forests • Ministry of Health • Ministry of Human Resources • Ministry of Labour • Ministry of Lands, Parks and Housing • Ministry of Municipal Affairs • Ministry of Transportation and Highway; • Ministry of the Provincial Secretary and j ernment Services The Administration Section performed a number of duties in 1981. The section ensured that TBS 100 forms were kept up to date; processed invoices and cheque vouchers; handled staff requisitions; maintained the branch policy and procedure manuals, and processed mail for the entire branch. The data entry function of the branch was considered effective if it met predetermined work schedules, which it did in 1981. It was also efficient since the 1981 cost per thousand strokes per capita was less than the 1980 average of $.00081. The branch's production operations were considered effective if more lines were printed in-house than for the previous year. In 1981, the branch was able to meet this target. Lines printed in-house amounted to 87.2 per cent of total lines, an increase of 7.2 per cent from 1980. Production operations were efficient when the cost per 1,000 lines printed in-house per capita was less than that for the previous year and lower than the cost to print at BCSC (after in-house operation and equipment costs are deducted). In 1981, the branch was able to achieve both these targets with an in-house cost of $.00039. inent is The Government Agencies Branch provides a broad range of government services to citizens throughout British Columbia. Statutory functions performed by the branch include those of water recorder; provincial collector; gold commissioner; marriage commissioner; registrar of births, deaths and marriages; official administrator; registrar of voters, and issuer of Autoplan Insurance and motor vehicle licences. During 1981, the Government Agents collected $281,000,000 in revenue for the Province, and accepted payment of certain accounts, such as provincial medical insurance premiums. In 1981, the branch had a total staff of 396 with offices in 62 British Columbia communities plus the Victoria headquarters. The organization of the branch was revamped during the year with the creation of a deputy directorship and eight regional directorships. All agencies in the province report to one of the eight regional Government Agents who in turn report to the director in Victoria. 45 GOVERNMENT AGENCIES Chetwynd Mackenzie • Fort St. John ® Dawson Creek ■fJ'-Eiince Rupert (5) Queen Charlotte City t #Smitl Terrace # • ^LaaaaaM Bella Coola • • Quesnel • Valemoun • Williams Lake 100 Mile House • Clinton *«u „aa __^J • Golden Ashcrott m Ullooet * ® Kamloops • Revelstoke • Salmon Arrr | Regional Headquarters Port rffirdy* , lnvtrm, Merritt ®Vernon . Nakusp Campbell River. Powell River • #Kelowna ftBlo |r> Courtenay. Sechelt. Squamish . ^ , PoAerni. Nanaimo.Vancouver . *C ,, m v^c 46 Office operations were improved during the year with the introduction of automated accounting system cash registers to 24 Government Agencies. Targeted completion of the automation plan is set for December 1982. Agency offices at Stewart, Atlin and Fort Nelson were upgraded, with renovations planned for a number of other agency offices over the next few years. One new agency office was opened in May 1981 at Cassiar. Another, at lljjj.ooet, moved to new quarters in December. A new agency logo, and standardized decor, which will be adapted to all future agency renovations, were introduced in the Lillooet office. As the representatives of all government ministries in the field, agency staff members continued to provide a broad range of services to the public in 1981. The staff also acted as government appointed observers at 471 strike votes throughout the province and coordinated the movement of mail for all ministries during the federal post office labour dispute. As well, Government Agencies staff assisted the Ministry of Intergovernmental Relations in coordinating travel arrangements and providing transportation for three cabinet tours. General revenue transactions were considered effective if transaction volume increased from the previous year and if there was an error factor of 2.5 per cent or less. This operation was efficient if staff costs were $3.17 per transaction or less. In 1981, the Government Agencies Branch met these criteria. The agencies processed 1,822,500 revenue generating transactions during the year, a 6.7 per cent increase over the 1,708,571 processed in 1980. Due principally to reduced forest revenues the dollar value of these transactions fell 45.3 per cent in 1981 from the previous year. Autoplan transactions were considered effective if transaction volume increased over the previous year and if the error factor was 4 per cent or less. In 1981, the agencies processed 427,500 ICBC transactions for a total value of $44,460,000. The number of transactions increased 6.1 per cent in 1981. The production of cheque vouchers and local cheques was effective if an error-free rate of 98 per cent was maintained, and efficient if staff costs per 47 1 local cheque produced were $5.75 or less.JM the branch met these criteria. Non-revenue customer transactions were em\ if individuals were served within 15 minuteaSI cent of the time. In 1981, Government Ager met this requirement. They handled 520,000 tr actions of this type which was a 10.6 per increase over the 470,000 of the year before. The Government Agencies Branch had ad istrative responsibility for the BusinessW® Act. However, in providing the diverse services are its responsibility, the Government Agen also administered sections of the acts of all t ministries. MATION Ies During 1981, the Information Services Branch provided information to the public and the news media concerning the Ministry of Finance and the financial and economic affairs of the government. The branch also prepared and distributed 68 news releases. Information Services was responsible for coordinating responses to questions posed to the Minister of Finance by members of the legislative assembly. The branch prepared, produced and distributed all major Ministry of Finance'publications as well as editing and producing several ministry manuals. At the request of the Deputy Minister and Assistant Deputy Ministers the branch designed, prepared and produced the Real Property Tax brochure, the Purchasing Commission Audio Visual brochure and an Orientation Package for new employees. During 1981 the branch produced and distributed six editions of the ministry newsletter, The Treasury. Management News, a newsletter aimed at all managers in the government was introduced by Information Services in 1981 and two issues were published and distributed by the branch. The efficiency and effectiveness of the branch was measured in terms of timeliness and accuracy. This means that publications and news releases prepared by Information Services had to be accurate both in content and style and had to meet the deadlines set by the Minister of Finance. During 1981 these requirements were met in the case of all major publications and news releases. There were 648 enquiries answered by Information Services in 1981. The efficiency and effectiveness measures of the branch stated that these queries be responded to within four hours. With few exceptions, Information Services was able to supply accurate information within the deadline. 49 u_ 1 EXECUTIVE COORDINATOR The Executive Coordinator maintained liaison the Ministry of Attorney General for pro|§| legal services to the Finance Ministry thrclt 1981. Responsibility for the preparation of H amended legislation put forward by the Fin; Ministry rested with the Executive CootHM who also undertook special projects at the® of the Deputy Minister. In 1981, these incJB establishment and coordination of a timemol the 1982 Provincial Budget, and the estaiHB of a systems review committee to coorqB existing and proposed data processing sysl within the ministry. This committee was chaire the Executive Coordinator. 50 IASING SSION The Purchasing Commission is an agency of the legislature attached to the Ministry of Finance. It purchases and disposes of supplies for government, maintains stock control and operates supply depots and warehouses. The total value of purchase orders placed in 1981 was $322 million, a 29 per cent increase from $250 million in 1980. This increase was partly due to expanding programs and service in government, and partly due to rising prices of the goods purchased by the commission. The number of purchase orders placed in 1981 increased by only 11 per cent, from 52,354 to 55,483, largely due to continued efforts to consolidate orders. The downturn in the Canadian economy and subsequent initiative of restraint imposed by government caused the commission to focus its policy objectives and processes on maximizing the provincial government's purchasing power. To this end several studies and projects were undertaken in 1981: • a lease management study, critically examining leasing practices throughout government and recommending future policy in this area, • a bulk purchasing study directed at consolidating government purchase requirements wherever possible, and • preparation of product standardization specifications for office furnishings and government vehicles. In keeping with new financial control requirements, the following internal projects were undertaken in 1981: • preparation of a new commitment accounting system, • application of a new budget preparation system involving all commission supervisors, and • revision of the policy and procedures manual of the Purchasing Commission. The commission also made progress in a number of other areas during the year. Its warehouse operation moved to new premises at 3285 Oak Street, Victoria, in March, allowing storage of more than 700 product lines. During 1981 the warehouse operation processed government supplies valued at more than $1.4 million. 51 u_ 1 The audio visual loan and repair service filled equipment loan requests for government minisl in 1981. The system has effected consioS savings—more than $40,000 in 1981—oven mates for rental of comparable equipment. Rep to more than 215 units of audio visual equipn were also carried out during the year, sa\ $18,850 in repair charges at equivalent out costs. The commission's surplus disposal service i cated furniture and equipment no longer nee by a ministry, to meet the requirements of o government ministries. In 1981, more than 2, surplus items of furniture and equipment were r cated through this service. When there is no further demand within govl ment for surplus items, they are disposed ol public sales, conducted according to the requ ments of the Purchasing Commission Act. Sail surplus equipment in 1981 totailed $3,981,9221 this, $1,376,137 was credited to individual gov! ment ministries, and $1,410,884 was returtiej Crown corporations. A further $19,518 was c ited to Social Service Tax as a result of sur| sales. The remaining proceeds of $1,175,385\| deposited to the government's Consolidated R\ nue Fund. A supply of basic office furniture is maintajnei the Purchasing Commission for short-term loar 2 to 12 months to government ministries. In 1 this service saved $153,776 over the eOTi cost of outside rentals. The purchasing operation of the commissMti efficient when the processing cost per pup order was $33.75 or less. It was effective Whet per cent of purchase orders were placed withii days of receipt. The business machine operation was effic when cost per hour for servicing did not exc $24.00. It was effective when 90 per cent of re calls were responded to within 1.5 daysM In 1981, the commission met all of the above gets in more than 90 per cent of the cases in wl a full staff complement was available. Ey of finance NATIONS British Columbia Budget, March 1981 Background Papers to the 1981 Budget Financial and Economic Review Interim Statements for the Ten Months Ended January 31, 1981 Estimates of Revenue and Expenditure, Fiscal Year Ending March 31, 1982 Public Accounts 1979-80 (Vol. 1 and 2) Quarterly Financial Reports, Fiscal Year 1981-82 Ministry of Finance Annual Report 1980 Thirty-eighth Annual Report of the Purchasing Commission, January 1 to December 31, 1980 Response to the 1980 Report of the Auditor General Report of the Task Force on the Financial Administration Act Real Property Taxation in Rural Areas of British Columbia Financial Administration Policy Manual and Digest Budget and Administrative Policy Manual 53 legislation administered by the ministry of finance Assessment Act Assessment Authority Act Auditor General Act Bonding Act British Columbia Electric Company LimiWi Acquisition Act British Columbia Railway Finance Act Business Licence Act Capital Commission Act Corporation Capital Tax Act Deficit Repayment Act Educational Institution Capital Finance Act Esquimalt & Nanaimo Railway Belt Tax Act Financial Administration Act Financial Information Act Funds Control Act Gasoline (Coloured) Tax Act Gasoline Tax Act Horse Racing Tax Act Hospital District Finance Act Hotel Room Tax Act Income Tax Act Inflation Control Act Inscribed Stock Act Insurance Premium Tax Act Land Tax Deferment Act Law Stamp Act Loan Authorization Cancellation Act Logging Tax Act Mining Tax Act Motive Fuel Use Tax Act Municipal Aid Act Pacific North Coast Native Cooperative Act Petroleum Sales Act Power Development Act Probate Fee Act Public Service Bonding Act Purchasing Commission Act Social Service Tax Act Special Funds Act, 1980 Supply Act—annual System Act Taxation (Rural Area) Act Tobacco Tax Act Toll Removal Act, 1964 Transmission Line (Underground) Act Unclaimed Money Act 54 m i 55
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ANNUAL REPORT 1981 Ministry of Finance For the year ended December 31, 1981 British Columbia. Legislative Assembly [1983]
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Title | ANNUAL REPORT 1981 Ministry of Finance For the year ended December 31, 1981 |
Creator |
British Columbia. Legislative Assembly |
Publisher | Victoria, BC : Government Printer |
Date Issued | [1983] |
Genre |
Legislative proceedings |
Type |
Text |
FileFormat | application/pdf |
Language | English |
Identifier | J110.L5 S7 1982_V01_14_001_055 |
Collection |
Sessional Papers of the Province of British Columbia |
Source | Original Format: Legislative Assembly of British Columbia. Library. Sessional Papers of the Province of British Columbia |
Date Available | 2018-09-19 |
Provider | Vancouver : University of British Columbia Library |
Rights | Images provided for research and reference use only. For permission to publish, copy or otherwise distribute these images please contact the Legislative Library of British Columbia |
CatalogueRecord | http://resolve.library.ubc.ca/cgi-bin/catsearch?bid=1198198 |
DOI | 10.14288/1.0372125 |
AggregatedSourceRepository | CONTENTdm |
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