OECD review of the Canadian Parliamentary Budget Office

3. Assessment against OECD Principles for Independent Fiscal Institutions

This section reviews the PBO’s alignment with OECD Principles, identifying the areas of strength as well as areas where targeted actions could help bring closer alignment.

Overall, the PBO demonstrates strong adherence to the OECD Principles for IFIs (OECD, 2014[3]) in many areas. Its mandate is clearly defined in legislation, covering budget analysis, fiscal projections, and costing of election proposals, with autonomy to set its own work programme and clear links to the budget process. The institution enjoys broad national ownership, with cross-party support for its enabling legislation and a design tailored to Canada’s context. Resources are adequate and protected, allowing the PBO to control staffing and budget planning. Accountability to Parliament is robust, with annual reports and work plans tabled and a well-established role in supporting legislative scrutiny. Transparency is also a strength: reports are published under the PBO’s name, and released promptly, reinforcing openness and credibility.

Nonetheless, there are areas where the institutional framework and operational practices could be strengthened to be closer aligned with the OECD Principles. Key opportunities for improvement are around leadership appointments, communications, and access to information.

The following table provides a comprehensive assessment of the PBO’s alignment with the OECD Principles (Table 2).

Table 2. Alignment of the Canadian PBO with OECD Principles for IFIs

3.1. Leadership appointments

Canada’s Parliamentary Budget Officer is appointed for an initial seven-year term, renewable for one or more terms up to seven years, to a maximum of 14 years, by the Governor-in-Council after consultation with party leaders and approval by Parliament. Interim appointments can be made for up to six months without parliamentary approval. The legislation does not limit the number of consecutive interim terms.

This framework broadly aligns with OECD Principle 2.2 on merit-based, non-partisan selection. However, recent experiences have highlighted real and potential weaknesses in the process, particularly around leadership continuity and independence, which risk weakening the PBO.

Several concerns have emerged:

1. The possibility of reappointment may create incentives for incumbents to temper criticism or avoid contentious analysis to secure a second term, which could compromise independence;

2. Delays in appointing a new leader and use of interim arrangements can weaken the institution’s leadership and stability; and

3. Interim appointments made solely by the Governor in Council, without parliamentary oversight, also open the door for partisanship. The absence of clear limits for consecutive interim appointments could also be exploited, further undermining institutional independence and stability.

To strengthen independence and continuity, the OECD recommends moving to a single, non-renewable term to eliminate incentives for reappointment, and establishing clear timelines for permanent appointments to avoid reliance on interim arrangements. Where interim appointments are unavoidable, parliamentary involvement – such as requiring secondary approval by a committee – would reinforce transparency, legitimacy and public confidence.

In addition, legislation should set clear criteria and limits for interim appointments, including restrictions on consecutive terms, to prevent prolonged temporary leadership. Another option is to designate a standing interim leader within the PBO, as in Ontario’s Financial Accountability Officer model, which ensures a streamlined and impartial transition until a permanent appointment is made (see Box 5). These changes would align the process more closely with OECD Principles and safeguard the PBO’s credibility as a non-partisan fiscal watchdog.

Box 5. Interim leadership arrangements for the Financial Accountability Officer of Ontario

The Financial Accountability Officer of Ontario (FAO) is appointed by the Assembly for a five-year term, renewable once for an additional five years. To ensure continuity and stability, the enabling legislation establishes a structured process for interim leadership:

Continuity after term expiry

The FAO may continue in office beyond the expiry of their term until either a temporary FAO is appointed, or a permanent successor is named by the Assembly (the legislature of Ontario).

Designation process of temporary appointment

The FAO must designate in writing to the Speaker an employee of the FAO’s office to assume the powers and duties of the FAO if the FAO is absent or the office becomes vacant. This designated individual exercises the full powers and duties of the FAO. The most recent example of this coming into practice was in 2023 when the term of the FAO expired, and the designated employee assumed their powers and duties.

If no designation exists, the person designated is no longer able to act, or the FAO has been removed or suspended, then the Assembly may appoint a temporary officer by order. Unless unanimously waived, the appointee must be selected by unanimous agreement of a panel composed of one member from each recognised party, chaired by the Speaker (non-voting).

In the case that the Assembly is not in session, the Board of Internal Economy may appoint a temporary FAO.

Duration of temporary appointment

A temporary FAO serves until the original FAO resumes duties, the suspension is revoked, another temporary FAO is appointed, or a permanent FAO is appointed.

3.2. Communications

The Canadian PBO has established a strong public profile and is widely recognised as a trusted voice in fiscal debate. This visibility reflects OECD Principle 8.1, which emphasises the importance of effective communication with media, civil society and other stakeholders to foster informed constituencies and strengthen accountability. From its inception, the PBO adopted an outward-facing approach, with leaders engaging actively with the media to promote transparency and fiscal literacy. However, these practices remain largely personality-driven rather than embedded institutionally. The absence of a formally documented communications strategy and limited dedicated in-house resources means the approach depends heavily on the style and priorities of individual Parliamentary Budget Officers.

Beyond leaders’ appearances in the media, the Office has cultivated a reputation for transparency through several practices including issuing press releases and hosting press conferences to support interpretation of PBO reports and databases and allowing staff to speak to journalists off the record. This open approach is viewed as essential for maintaining strong media relationships.

Nevertheless, reliance on the Parliamentary Budget Officer as the primary spokesperson creates several risks. It limits the development of an institutional voice that can endure leadership transitions, leaving continuity vulnerable when priorities shift. Concentrating media responsibilities on one individual also places operational pressure on the Parliamentary Budget Officer. In addition, commentary by the Parliamentary Budget Officer may be perceived as opinion, raising reputational concerns and the risk of politicisation. While annual reports highlight the importance of public outreach, the lack of codified processes, such as guidelines for media engagement or protocols for managing errors, means that these practices expose the Office to reputational risks. These gaps could undermine credibility and weaken the PBO’s ability to maintain influence over time.

To embed a sustainable communications culture, the PBO should adopt a formal communications strategy that prioritises engagement with Parliament while maintaining proactive outreach to the media and public to strengthen fiscal literacy (see Box 6). This strategy should include measures to integrate communications expertise early in report development, improve accessibility of outputs, and provide clear guidelines for media engagement and authorised key messages for reports. It should also detail its policy for correcting the public record in the case of missteps or errors, to protect credibility and maintain trust. Training for staff, beginning at onboarding and continuing periodically, would help ensure consistency and confidence in interactions. A more distributed approach, where senior analysts engage more publicly with media, could also reinforce institutional credibility and reduce operational pressure on the Parliamentary Budget Officer, while safeguarding the PBO’s influence as a trusted source of fiscal analysis.

Box 6. The strategic approach of the Netherlands CPB to communications

The Netherlands CPB’s communications strategy sets out how the organisation can build a bridge between its economic analysis and policy decision-making. It is anchored in three interrelated goals that form a cascade: reputation enables impact, and impact drives knowledge sharing:

1. Safeguard and strengthen reputation and identity: Reputation and trust are essential for CPB’s work to be valued. While policymakers are the primary audience, maintaining credibility with media and the public is critical; without it, research risks being overlooked and advice loses influence.

2. Enhance the impact of research and advice: Analyses must reach the right audiences at the right time to inform policy decisions.

3. Promote knowledge sharing: Openness about gaps and active engagement with external stakeholders enhance reliability and foster development.

To deliver on these goals, the strategy incorporates several key elements:

• Transparency: CPB maintains trust by being clear about its choices, intended audiences, limitations, and vulnerabilities.

• Thematic Focus: The strategy concentrates on a small number of priority themes for one to two years, ensuring coherence and relevance while maintaining flexibility to address cross-sectoral issues. It also requires continuity and careful choices about which topics to address, through which medium, with what goal, and with which message.

• Audience-Centric Approach: It identifies each of the IFI’s core audiences and explicitly outlines how each should be reached.

• Adaptability: The strategy includes a component to ensure responsiveness to emerging trends in communications.

Taken together, these goals and elements help guide the CPB on decisions on allocating communication capacity and resources to ensure its work is serving its mandate.

Transitioning from a leadership‑driven approach to an institutional communications culture requires dedicated capacity. Currently, the PBO has only one staff member focused exclusively on communications, added as part of the 2017 expansion, with contract expertise added as needed. By contrast, the UK Office for Budget Responsibility (OBR) has grown its communications team as its mandate expanded: with similar overall staffing, the OBR employs three communications specialists. Strengthening the PBO’s communications resources would enable it to design and implement a formal strategy more effectively, enhance digital engagement, and ensure stability and continuity through leadership transitions.

3.3. Access to information

OECD Principle 6.1 underscores the importance of ensuring IFIs have full and timely access to relevant information, to address the inherent asymmetry of information between government and IFIs. While the Canadian PBO has made progress in securing data for its analysis, significant limitations remain that prevent full alignment with these principles. Current legislative frameworks impose notable restrictions, particularly under the Income Tax Act, which prohibits the Canada Revenue Agency from sharing tax microdata with the PBO. As a result, the PBO can only access aggregated or anonymised datasets, limiting its ability to provide comprehensive and timely analysis.

These restrictions have tangible consequences. For example, the PBO’s long-standing effort to produce a complete estimate of Canada’s tax gap was hindered by the lack of individual tax data, resulting in an analysis focused only on corporate data and leaving parliamentarians without a full picture of the issue (PBO, 2019[4]). While legislative proposals such as Bill S-217 aim to address this gap, current constraints continue to impede analytical precision and timeliness. In practice, the PBO relies on Statistics Canada for data to support microsimulation models and tax studies, but this workaround introduces delays and higher costs, as datasets are rarely up to date and may not cover new programmes. To reduce information asymmetries and strengthen the PBO’s capacity to serve parliamentarians effectively, stakeholders were broadly supportive of legislative amendments to secure access to tax microdata and clarify rights under the Access to Information Act, the Income Tax Act, and other tax statutes.

Outside tax data, relationships with departments are generally positive, but without MoUs beyond election periods, access often relies on informal arrangements. Standing MoUs with key departments would clarify expectations and operationalise access rights, a common OECD IFI practice (see Figure 3). An example is provided by the OBR in the United Kingdom, which uses MoUs to define required data (OECD, 2021[5]).

Together, these measures would enhance analytical quality, improve timeliness, and align the PBO more closely with OECD Principles.

Figure 3. A majority of OECD IFIs have MoU in place to support access to information

Note: The data includes 35 national IFIs in OECD countries. The data includes two IFIs for Austria, Finland, Greece and Ireland, where there is both a Fiscal Council and a Parliamentary Budget Office.

Source: OECD IFI Database 2021