STAFF REPORT

February 14, 2000

To: Board of Health

From: Dr. Sheela V. Basrur

Subject: Public Health 2000 Operating Budget Submission and Proposed Reductions

Purpose:

This report identifies adjustments to the Public Health 2000 Operating Plan and Budget that was approved by the Board of Health on October 17, 1999. These adjustments include one recommended reduction proposed by Toronto Public Health in response to the Chief Administrative Officer's request as well as reduction options negotiated between Public Health and Finance to achieve the CAO's target budget. Financial information related to the Children and Youth Action Committee Action Plan and Animal Services are dealt with in separate reports.

Financial Implications and Impact Statement:

The total 2000 Public Health Operating Plan and Budget, approved by the Board of Health on October 17, 1999 after technical amendments, was $124.1 million (gross); $56.6 million (net). The CAO's target budget for Public Health is $118,801.4 (gross) and $53,327.8 (net) which is $321,600 less than the net budget approved in 1999.

A variety of reduction options were being considered by the Corporate Senior Management Team and at this time, the CAO's 2000 Operating budget has not been finalized.

The CAO's target budget represents a 6.2% reduction to the 1999 approved base budget (gross), and reduces the Toronto Public Health Operating Budget approved by the Board of Health by $5.4 million (gross) and $3.4 million (net). The proposed reductions to the Toronto Public Health Operating Budget under consideration as of this date are presented in Attachment 1. Technical adjustment to the original Public Health 2000 Operating Budget Submission are presented in Attachment 2.

The Chief Financial Officer and Treasurer has reviewed this report and concurs with the financial impact statement.

Recommendations:

It is recommended that:

(1) The Board of Health approve the revised costs for provincially mandated and local program enhancements as follows (in thousands):

(a) Control of infectious Diseases - $293.5 (gross), $146.8 (net)

(b) Racoon Rabies - $91 (gross), $45.5 (net)

(c) Child Nutrition - $65.0 (gross) $32.5 (net)

(d) Emergency Response - $49.0 (gross), $24.5 (net)

(e) Dental Treatment -$1.6 million (gross/net)

(2) The required enhancement to achieve compliance with new Provincial requirements for the Personal Service Settings component of the Control of Infectious Disease / Infection Control program be phased in over two years (i.e. 2000 and 2001). The budgetary adjustment is as follows:

(a) Original submission - $903.6 (gross) / 4451.8 (net), 11.5 FTE's (six months)

(b) The agreed adjustment - $ 293.5 (gross) / $146.8 (net), 3FTE's (four months) for the year 2000

(3) That the required Information Technology resources totalling $980.8 thousand (gross) in 2000 and $1.3 million in 2001, be financed from within the $13.2 million budget for Public Health corporate charges, and that these monies be in addition to the $2.5 million currently provided to Public Health by Corporate Information and Technology.

(4) This report be forwarded to the Policy and Finance Committee for consideration, and the Budget Advisory Committee secretary for the budget process pending file, in accordance with the Financial Control Protocols adopted by the City.

Background:

Following the Board of Health's approval of the Public Health 2000 Operating Plan and Budget, the Chief Administrative Officer directed all City Departments, Agencies, Boards, and Commissions to propose budget reductions equalling 5% of the 1999 approved base budget. The CAO also required that all budgets be "flat-lined", thereby prohibiting any financial increases to 1999 approved base budgets and requiring that the cost of all service expansions and enhancements be accommodated by corresponding budget reductions.

At its December 9, 1999, meeting, the Budget Advisory Committee approved the reestablishment of the Public Health Research Education and Development program (PHRED) in principle, but no funding was approved. Instead, the committee recommended that a formal request be made to the Province to provide 100% funding for this program. Also at this meeting the Budget Advisory Committee recommended that Public Health's capital budget request for information technology resources be referred to Corporate Information and Technology so that required equipment can be provided from existing inventories. Funding for information technology requested in the original budget submission to the Board of Health was not approved. This includes the request for 9 additional FTE's to support Public Health's information technology systems, applications and users. However, there was a commitment that these resources would be provided through negotiations with Corporate Information and Technology.

Comments:

Prior to the October 17, 1999 report to the Board of Health in which Public Health presented its proposed 2000 Operating Plan and Budget, Public Health made every effort and explored all viable operational strategies to redistribute internal resources, minimize the need for additional funding, and find internal efficiencies. Service expansions and enhancements included in the Public Health 2000 Operating Plan and Budget included only those increases required to fund the annualized impact of pre-approved harmonization projects, Council requested initiatives, compliance with new mandatory guidelines and closer compliance with existing guidelines where inadequate resources were prohibiting full compliance.

The year 2000 Public Health Operating Budget includes $13.2 million in corporate charges. On the recommendation of Corporate Finance staff, the Commissioner of Community and Neighbourhood Services and the Medical Officer of Health have requested that relevant City departments and Division Heads specify the services and clarify the amounts for which Public Health was charged in 1999. This clarification will enable a more accurate allocation within corporate charges. The Medical Officer of Health has received verbal confirmation that the Corporate Information and Technology component of the total 1999 Corporate Charges was $2.5 million. Therefore, Public Health's information technology requirements of $980.8 (gross) in 2000, and $1.3 million (gross) in 2001, should be financed from corporate charges and be in addition to the $2.5 million currently provided to Public Health by Corporate Information Technology.

Budget discussions regarding required reductions have continued since the presentation of the Public Health 2000 Operating Budget to the Board of Health in October 1999. The Corporate Senior Management Team is discussing further reductions to all city department budgets including Public Health. All these potential cuts will be consolidated in the CAO's proposed budget and is not yet available.

The Public Health 2000 Operating Budget was presented to the Chief Administrative Officer on January 22, 2000. At this time, the CAO requested additional reductions to Public Health's Planning and Policy and Support Services units, in the amount of $500 thousand (gross) and $250 thousand (net). These and further reductions are being discussed by the Corporate Senior Management Team.

Conclusions:

This report outlines the adjustments to the Public Health 2000 Operating Plan and Budget Submission approved by the Board of Health on October 17. 1999. To accurately identify the full impact of these reductions, the resulting budget total of $120.6 million (gross) and $54.6 million (net) must be compared to the original approved totals of $124.1 million (gross) and $56.6 million (net).

It is important to note that any agreed upon reductions to the Public Health Budget are dependent upon additional support for information technology resources. These resources are integral to all components of Public Health services and essential for the ongoing operations of Toronto Public Health. They were identified as a priority in the October 17, 1999 Board of Health Report.

Budget reductions and cuts to Public Health infrastructure will result in serious and detrimental impacts on the health of Toronto's population. The specific nature of these impacts will be the subject of a verbal presentation from the Medical Officer of Health and Board of Health at its meeting in February 21, 2000, once the CAO's reduction options are made public.

Contact:

Mary Graham

Director, Support Services

Toronto Public Health

Tel: (416) 392-7467

Fax: (416) 392-0713

E-mail: mgraham@toronto.ca

Dr. Sheela V. Basrur

Medical Officer of Health