Financial Consumer Agency of Canada

www.fcac-acfc.gc.ca

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Business Plan 2011 - 14

Section I: Agency Overview

Introduction

This section provides an overview of FCAC's role and responsibilities, strategic outcomes and program activities. It highlights the financial and human resources dedicated to the Agency's program activities and sub-program activities, as well as the contribution of the Agency's strategic priorities to its program activities and program sub-activities.

Summary information

Raison d'être

The Financial Consumer Agency of Canada (FCAC) was established to consolidate and strengthen oversight of consumer protection measures in the federally regulated financial sector, and to expand consumer education and financial literacy activities so that Canadians have the appropriate information and financial skills they need to make informed financial decisions and actively participate in and strengthen the financial sector.

Vision

To empower Canadian financial consumers and promote responsible financial market conduct.

Responsibilities

FCAC is an independent federal government agency established under the Financial Consumer Agency of Canada Act (FCAC Act). It fulfills the roles listed below. In 2010–11, the Government of Canada expanded the Agency's mandate to include the items in italics

1. Supervise financial institutions to determine whether they are in compliance with
   
   
   1. the consumer provisions applicable to them, and
      
      
   2. the terms and conditions or undertakings with respect to the protection of customers of financial institutions that the Minister imposes or requires, as the case may be, under an Act listed in Schedule 1 and the directions that the Minister imposes under this Act;
   
   
   
2. Promote the adoption by financial institutions of policies and procedures designed to implement
   
   
   1. provisions, terms and conditions, undertakings or direction referred to in paragraph a,
      
      
   2. voluntary codes of conduct that are designed to protect the interests of the customers of financial institutions, that are adopted by financial institutions and that are publicly available, and
      
      
   3. any public commitments made by financial institutions that are designed to protect the interests of their customers;
      
      
3. Monitor the implementation of voluntary codes of conduct that are designed to protect the interests of customers of financial institutions, that have been adopted by financial institutions and that are publicly available and to monitor any public commitments made by financial institutions that are designed to protect the interests of their customers;
   
   
4. Promote consumer awareness about the obligations of financial institutions under consumer provisions applicable to them and about all matters connected with the protection of consumers of financial products and services;
   
   
5. Foster, in co-operation with any department, agency, or agent corporation of the Government of Canada or of a province, financial institutions and consumer and other organizations, an understanding of financial services and issues relating to financial services;
   
   
6. Monitor and evaluate trends and emerging issues that may have an impact on consumers of financial products and services;
   
   
7. Supervise payment card network operators to determine whether they are in compliance with the provisions of the Payment Card Networks Act and its regulations;
   
   
8. Promote the adoption by payment card network operators of policies and procedures designed to implement the provisions of the Payment Card Networks Act and its regulations;
   
   
9. Monitor the implementation of voluntary codes of conduct that have been adopted by payment card network operators and that are publicly available, and to monitor any public commitments made by them regarding their commercial practices in relation to payment card networks;
   
   
10. Promote public awareness about the obligations of payment card network operators under a voluntary code of conduct or under the Payment Card Networks Act.
    
    

FCAC supervises and monitors institutions that are federally regulated. These institutions include all banks and federally regulated, incorporated or registered insurance, trust and loan companies, retail associations, as well as payment card network operators.

As of March 31, 2012, FCAC regulated 380 FRFEs. By category, there were 77 banks (domestic and foreign), 67 trust and loan companies, 229 insurance companies (life and property and casualty, domestic and foreign), 1 retail association and 6 payment card network operators. Through the Minister of Finance, FCAC reports to Parliament on the Agency's activities and the legislative framework for consumer protection.

Values

Strategic outcomes and Program Activity Architecture (PAA)

Planning Summary

Financial resources ($ millions)

Human resources full-time equivalents (FTEs)

For financial and human resource details, please refer to the Expenditure Profile section.

Staffing strategies

The Agency has both a regulatory and an educational role. It supervises the market conduct of federally regulated financial entities. It also fosters a better understanding among Canadians of financial entities' obligations to them, of the financial products and services they need, as well as of basic financial skills.

It is important for FCAC staff to have a wide range of experience and knowledge, reflecting the diversity of financial services. When recruiting staff, FCAC tries to find candidates who have experience in and knowledge of retail financial services. Having this profile of individuals on the staff enhances the Agency's credibility with financial institutions and consumers.

To maintain its talent pool, FCAC makes use of internal and external advertised processes, Interchange Canada, and deployments.

Nationwide external advertised processes are and will continue to be the primary mechanism to attract and develop the highly specialized skills required to carry out FCAC's mandate. When required, pools of qualified candidates are established in order to facilitate timely appointments. Non-advertised staffing activities are used only for short-term positions unless candidates can be taken from existing pools.

FCAC will continue to respect priority entitlements and ensure appropriate consideration of the core and guiding values of the Public Service Employment Act throughout all aspects of its staffing activities.

As a micro agency dealing directly with the public, FCAC has a workload that varies according to the issues, initiatives and media attention received. Senior managers set priorities to balance workload surges. To respond to unpredictable demands, the Agency hires and may continue to hire casual employees and students from time to time.

If workload demands that were expected to be temporary remain high for longer periods, further action may be warranted. Depending on the urgency, managers may avail themselves of interchange from other organizations or recruit through normal staffing processes, including external and internal appointment processes.

FCAC must strike a balance between external staffing and the need to enhance the experience and contribute to the development of current staff members. When appropriate, the Agency provides developmental or acting assignments for staff, which can last up to a year. This approach helps the Agency become more resilient in dealing with unexpected absences.

Planning summary tables

Benefits for Canadians:

The compliance supervision and enforcement program seeks to strengthen compliance by federally regulated financial entities with the federal provisions applicable to them and subject to FCAC's supervision. The program also seeks to promote FRFEs' adherence to the various codes of conduct and public commitments put in place by the industry to further protect their customers.

In enforcing the relevant consumer provisions and monitoring adherence to codes and commitments, consumers and merchants benefit from the regulatory framework put in place by the government to ensure that they receive all of the pertinent information to which they are entitled. This puts them in a better position to make informed financial decisions, and helps ensure that proscribed business practices of FRFEs do not manifest themselves in the marketplace. This, in turn, helps consumers and merchants enjoy the social and economic benefits of participating in a fair and secure Canadian financial marketplace.

Benefits for Canadians:

The consumer information and development of financial skills program seeks to enhance consumers' knowledge of the federally regulated financial entities' obligations toward them, as well as consumers' understanding of financial products and services, and related issues. The program also seeks to enhance the financial skills of select audiences.

Consumers make better financial decisions if they are aware of and understand their rights and responsibilities with regard to financial products and services, and if they have the skills and confidence to make sound decisions. Informed consumers are also better able to actively participate in the financial marketplace and thus strengthen competition. This, in turn, helps consumers enjoy the social and economic benefits of participating in a fair and secure Canadian financial marketplace.

Contribution of strategic priorities to strategic outcomes and programs

Risk analysis related to FCAC programs and sub-programs

FCAC has in place a corporate risk profile, which is updated regularly and identifies and assesses the key risks facing the Agency. Several risk mitigating strategies have been introduced and progress with respect to their implementation is reported to the Agency's Audit Committee. The following table lists some of the key risks applicable to FCAC's programs and sub-programs.

FCAC will continue to monitor and implement its risk mitigating strategies. It will consider all pertinent risks, and incorporate them into its strategic planning and business planning process.

Expenditure profile

The above table shows a six-year spending trend that includes one year of forecasted expenditures for 2012-13 and outlines planned spending for fiscal year 2013–14.

2009-10

The increase in spending when compared to the previous fiscal year is due to higher human resources costs as a result of hiring additional staff for marketing and communications activities; the filling of vacancies; and planned increases in employee compensation and performance-related pay. In addition, professional costs increased by $852K for marketing and communications activities and campaigns undertaken to meet the Agency's Business Plan goals and objectives.

2010-11

As a result of the expansion of FCAC's mandate, resource levels were increased to handle additional workloads. This, together with cost of hiring and merit adjustments, amounts to an increase of $984K. In addition, two key IT initiatives were undertaken (Web renewal and IM/IT strategy & Implementation Roadmap), the cost of which, however, was partially offset by a reduction in other operating expenses.

2011-12

The timing of staffing actions and procurement processes related to IT activities caused the Agency to under spend its budget by $860K.

2012-13 (forecast)

IT activities initially planned for 2011-12 were commenced in 2012-13, and will continue in 2013-14. As a result, costs associated with these activities were deferred from 2011-12 and caused 2011-12 actual expenses to be under budget by $860K (see above). The variance between the amounts presented as 2012-13 forecast and 2011-12 actual is mainly due to three key elements: expenses initially planned for 2011-2012 are being incurred in 2012-2013; increased human resource levels required to execute the new mandate; and, the full impact of staff hired in 2011-12.

2013-14 (planned)

The Agency continues its IT activities which now include a Web Content Management Solution component to comply with the Treasury Board Secretariat directives on accessibility standards for government websites (formerly Common Look & Feel 2.0). This project, along with increases in the cost of service memoranda the Agency has in force with other federal organizations, translates into an increase in previously planned expenses for 2013-2014. FCAC was able to manage these increases by reducing discretionary spending in its planned budget for 2013-14 for a net increase of $750K.

It is important to note that the actual, forecasted and planned spending for fiscal years 2011-12, 2012-13 and 2013-14, excluding costs related to the expanded mandate and maternity/paternity costs, presented in the updated spending profile totals $35.07 million, while the initial forecasted and planned budget for the three years amounted to $35.16 million. It is only as a result of timing of some initiatives that the costs have shifted and spilled over from one fiscal year to another. Despite this, however, there was no overall expenditure increase for the three-year period in question.

Date Modified:

2013-05-15