ARCHIVED - 6. Our Operational and Financial Planning

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Recent experiences such as the response to Hurricane Katrina and increased support to security issues underscore the importance of CCG’s ability to deliver on public expectations of operational readiness and integrated contingency planning. To accomplish this, CCG employs a variety of planning methods to ensure it is prepared to conduct missions – with vessels in place, fuel on board, highly trained and adaptable crews ready – and strategic planning methods in place to make sure that business and management practices, as well as funds are in place to operate, procure, and maintain the vessels and helicopters needed to satisfy existing and future challenges.

During 2006-2007, CCG developed the concept of Fleet Operational Readiness as the foundation for determining its longer term capacity requirements. This reorientation will enable the CCG to evolve from a narrow short-term approach driven by client requirements and funding to a more holistic long-term approach in which the Agency is positioned as Canada’s “whole of government” civilian maritime solution, ready to operationally respond in times of need. This new approach will ensure the fleet is equipped and available when needed and that it provides safe and secure, efficient, and effective services. The readiness concept, and the development of a corresponding business framework, will make the financial resources required to operate the fleet more transparent to clients, that is, those resources required to ensure an operationally ready fleet versus those resources only needed to deliver services at sea, so that more effective service agreements and practices can be established and formalized.

Each year, clients are required to define their needs that are used to develop the national Fleet Operations Plan, which includes specific vessel schedules and missions, as well as the cost of delivering those services.  The financial basis for the planning of client needs is the National Fleet Costing Model.  CCG’s financial resources are fixed each year at the beginning of the budgetary cycle, while demand for some of its services is often variable and unpredictable, causing in-year adjustments. When unanticipated service demands arise after the annual planning cycle has been completed, efforts expended in other areas are, of necessity, modified accordingly after review of priorities and risks.

Table 9 summarizes the Fleet’s national level budget for 2006-2007.  During this fiscal year, the CCG began its move to activity-based budgeting under the Fleet Operational Readiness concept, ensuring more transparency, making the costs of service clearer to Canadians, and improving accountability.

Table 9: Fleet National Budget, 2006-2007 ($000s)
  SalariesOperations and Maintenance (O&M) FuelSub TotalMinor CapitalTotal
Fleet 141,611 26,071 39,016 206,699 0 206,699
Helicopters  * 14,020 ** 14,020 0 14,020
Sub Total 141,611 40,092 39,016 220,719 0 220,719
Shore 17,321 7,311   24,633 438 25,071
Total 158,933 47,404 39,016 245,533 438 245,791

A transitional CCG methodology was used to allocate the fiscal year 2006-2007 budget utilizing primarily historical expenditure information. During the year, a new Fleet Financial Framework was produced that will guide the development of the Fleet Financial Plan for 2007-2008.  This framework uses the concept of specially controlled and targeted budget allotments for operational and non-operational expenditures, and further introduces standard and non-standard budgetary items. This plan will become a model for introduction CCG-wide.

As a consequence of this change, beginning in 2007-2008, CCG managers and employees will see more clearly defined links between the way funds are appropriated from Parliament, internal planning and budget allocations, and year-end reporting to Parliament. It is also expected that activity-based budgeting will better facilitate operational and financial performance reporting and monitoring.

CCGS Leonard J. Cowley
CCGS Leonard J. Cowley
, Offshore Patrol Vessel

Photo: NL Region

* Helicopters Pilots are Transport Canada employees and not CCG employees.

** Fuel is included in O&M.

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