SDG N° 12, target 12.c

What we examined: This audit focused on whether the Department of Finance Canada provided advice to support decision making on inefficient tax subsidies for fossil fuels that was based on analysis of all relevant and reliable information.

Why we did this audit: This audit is important because inefficient fossil fuel subsidies encourage wasteful consumption, undermine efforts to address climate change, and discourage investment in clean energy sources. Without providing decision makers with advice based on complete assessments, the Department of Finance Canada cannot ensure that it is providing the support needed by the Minister for Canada to meet its G20 commitment by 2025.

Overall message: We found that the Department of Finance Canada’s assessments to identify inefficient tax subsidies for fossil fuels were incomplete, and that advice it provided to the Minister was not based on all relevant and reliable information.

The Department of Finance Canada conducted an overall assessment of tax expenditures—which reduce taxes payable by certain taxpayers and the amount of revenue that the government would collect—and identified those that provided a specific advantage to the fossil fuel sector as subsidies. At the end of June 2018, the Department had also begun assessing 2 of the 12 benchmark tax measures—general tax measures in the tax system—specific to the fossil fuel sector to identify those that could potentially be fossil fuel subsidies.

The Department of Finance Canada did not clearly define how a tax subsidy for fossil fuels would be inefficient. The Department's assessments focused almost exclusively on fiscal and economic considerations and did not consider the integration of economic, social, and environmental sustainability in subsidizing the fossil fuel sector over the long term.

Qu'avons-nous examiné ? L'audit visait à déterminer si le ministère des Finances Canada avait fourni des conseils pour appuyer la prise de décision au sujet des subventions fiscales inefficaces aux combustibles fossiles en se fondant sur l'analyse de tous les renseignements fiables et pertinents.

Pourquoi avons-nous effectué cet audit ? Cet audit est important parce que les subventions inefficaces aux combustibles fossiles encouragent la surconsommation, portent atteinte à la lutte contre les changements climatiques et font obstacle aux investissements dans les sources d'énergie propre. Faute de fournir aux décideurs des conseils fondés sur une évaluation exhaustive, le ministère des Finances Canada ne peut garantir qu'il offre au Ministre le soutien requis pour que le Canada respecte d'ici 2025 l'engagement qu'il avait pris lors du Sommet du G20.

Message général : Nous avons constaté que les évaluations réalisées par le ministère des Finances Canada pour recenser les subventions fiscales inefficaces aux combustibles fossiles étaient incomplètes, et que les conseils fournis au Ministre n'étaient pas fondés sur tous les renseignements pertinents et fiables.

Le ministère des Finances Canada a effectué une évaluation générale des dépenses fiscales. Ces dernières sont utilisées pour réduire les impôts de certains contribuables et ont pour effet de réduire les recettes fiscales du gouvernement. Le Ministère a recensé les dépenses fiscales qui procuraient un avantage particulier au secteur des combustibles fossiles et qu'il considère comme des subventions. À la fin de juin 2018, le Ministère venait aussi de commencer à évaluer 2 des 12 mesures du régime fiscal de référence (mesures fiscales générales du régime fiscal) qui se rapportent au secteur des combustibles fossiles afin de recenser celles qui pourraient constituer des subventions aux combustibles fossiles.

Le ministère des Finances Canada n'a pas clairement défini comment une subvention fiscale aux combustibles fossiles pourrait être inefficace. Le Ministère a axé ses évaluations presque exclusivement sur des considérations économiques et fiscales et n'a pas pris en compte l'intégration de la durabilité économique, sociale et environnementale dans ses évaluations de l'octroi de subventions au secteur des combustibles fossiles dans une perspective à long terme.

SDG N° 12, target 12.c

The Department of Finance Canada should develop guidance that clearly defines the criteria for determining the inefficiency of tax subsidies for fossil fuels, taking into account relevant and reliable evidence that integrates on an equal basis economic, social, and environmental sustainability over the long term.The Department of Finance Canada should develop guidance that clearly defines the criteria for determining the inefficiency of tax subsidies for fossil fuels, taking into account relevant and reliable evidence that integrates on an equal basis economic, social, and environmental sustainability over the long term.

Le ministère des Finances Canada devrait élaborer des directives définissant clairement les critères qui permettent de déterminer l'inefficacité d’une subvention fiscale aux combustibles fossiles en tenant compte de données probantes fiables et pertinentes qui démontrent l'intégration de la durabilité économique, sociale et environnementale sur une base égale et dans une perspective à long terme.

SDG N° 12, target 12.c

What we examined: This audit focused on whether Environment and Climate Change Canada provided advice to support decision making on inefficient non-tax subsidies for fossil fuels that was based on analysis of all relevant and reliable information.

Why we did this audit: This audit is important because inefficient fossil fuel subsidies encourage wasteful consumption, undermine efforts to address climate change, and discourage investment in clean energy sources. Without providing decision makers with advice that is based on complete assessments, Environment and Climate Change Canada cannot ensure that it is providing the support needed by ministers for Canada to meet its G20 commitment by 2025.

Overall message: We found that Environment and Climate Change Canada’s work to identify inefficient non-tax subsidies for fossil fuels was incomplete and not rigorous. In our view, this is partially because the Department used unclear definitions.

To identify non-tax subsidies for the fossil fuel sector, Environment and Climate Change Canada considered 23 of approximately 200 government organizations and identified 36 ongoing potential non-tax subsidies that supported the consumption or production of fossil fuels. We found that the Department missed some potential subsidies that in our opinion it should have considered. Of the 36 potential non-tax subsidies identified, it determined that 4 were subsidies for the fossil fuel sector.

Once Environment and Climate Change Canada identified non-tax subsidies for the fossil fuel sector, it assessed whether these were inefficient. We found that the Department identified no inefficient non-tax subsidies. However, it had not defined "inefficient" to guide its determinations.

We also found that in its assessments, the Department did not consider the economic, social, and environmental sustainability of subsidizing the fossil fuel sector. The Department informed us that its assessments were only preliminary.

Qu'avons-nous examiné ? L'audit visait à déterminer si Environnement et Changement climatique Canada avait fourni des conseils pour appuyer la prise de décision au sujet des subventions non fiscales inefficaces aux combustibles fossiles en se fondant sur l'analyse de tous les renseignements fiables et pertinents.

Pourquoi avons-nous effectué cet audit ? Cet audit est important parce que les subventions inefficaces aux combustibles fossiles favorisent la surconsommation, portent atteinte à la lutte contre le changement climatique et font obstacle à l'investissement dans des sources d'énergie propre. Faute de fournir aux décideurs des conseils fondés sur des évaluations exhaustives, Environnement et Changement climatique Canada ne peut garantir qu'il offre le soutien dont les ministres ont besoin pour que le Canada respecte d'ici 2025 l'engagement qu'il avait pris lors du Sommet du G20.

Message général : Nous avons constaté que les travaux d'Environnement et Changement climatique Canada pour recenser les subventions non fiscales inefficaces en ce qui a trait aux combustibles fossiles étaient incomplets et manquaient de rigueur. À notre avis, cela s'explique en partie par le fait que les définitions que le Ministère a utilisées n'étaient pas claires.

Pour recenser les subventions non fiscales au secteur des combustibles fossiles, Environnement et Changement climatique Canada a examiné 23 des quelque 200 organisations du gouvernement afin de recenser 36 subventions non fiscales courantes susceptibles d'appuyer la consommation ou la production de combustibles fossiles. Nous avons constaté que le Ministère avait omis d'éventuelles subventions qu'il aurait dû, à notre avis, examiner. Il a déterminé que 4 des 36 éventuelles subventions non fiscales recensées étaient des subventions au secteur des combustibles fossiles.

Après avoir recensé les subventions non fiscales au secteur des combustibles fossiles, Environnement et Changement climatique Canada les a évaluées pour déterminer si elles étaient inefficaces. Nous avons constaté que le Ministère n'avait recensé aucune subvention non fiscale inefficace. Cependant, il n'avait pas défini le terme « inefficace » afin d'orienter ses conclusions.

Nous avons également constaté que le Ministère n'avait pas pris en compte, dans ses évaluations, la durabilité économique, sociale et environnementale des subventions octroyées au secteur des combustibles fossiles. Le Ministère nous a informés que ses évaluations n'étaient que préliminaires.

SDG N° 12, target 12.c

• Environment and Climate Change Canada should develop guidance that clearly defines the non-tax measures that are potential subsidies to be reviewed.
• Environment and Climate Change Canada should conduct a complete and rigorous assessment of potential non-tax subsidies for fossil fuels.
• Environment and Climate Change Canada should develop guidance that clearly defines the criteria for determining the inefficiency of non-tax subsidies for fossil fuels, taking into account relevant and reliable evidence that integrates on an equal basis economic, social, and environmental sustainability over the long term.

• Environnement et Changement climatique Canada devrait formuler des lignes directrices qui définissent clairement les mesures non fiscales qui constituent d'éventuelles subventions à examiner.
• Environnement et Changement climatique Canada devrait effectuer une évaluation complète et rigoureuse des éventuelles subventions non fiscales aux combustibles fossiles.
• Environnement et Changement climatique Canada devrait élaborer des directives définissant clairement les critères qui permettent de déterminer l'inefficacité d'une subvention non fiscale aux combustibles fossiles, en tenant compte de données probantes fiables et pertinentes qui démontrent l'intégration de la durabilité économique, sociale et environnementale sur une base égale et dans une perspective à long terme.

The mining industry is directly or indirectly linked to several SDG goals. These include for example goals N° 7, 8, 9, 12, 13 and 15.

The economic, social, and ecological sustainability of mining is debated in Finland, in the EU and around the world. In the report Perspectives on sustainable mining in Finland this topic is approached from the following perspectives: the connection between sustainable mining and central government finances, objectives and implementation of Finland’s mining policy, increasing the added value of battery minerals and battery industry, circular economy solutions for mining operations, local acceptance of mining operations (social licence to operate, SLO), and the management of environmental risks arising from abandoned and closed mines.

Even though mining is a commercial activity, it is connected with the state and central government finances in many ways. Environmental protection and ecologically sustainable mining have also been major themes in Government Programmes in the 2010s. The Finnish Mineral Strategy published in 2010 and the Sustainable Extractive Industries Action Plan presented in 2013 are the two key strategies guiding Finland’s mining and mineral policy. The Sustainable Mining Network and the mining responsibility system created by it were established on the basis of the recommendations set out in the Sustainable Extractive Industries Action Plan. Mining sector actors have been mostly satisfied with the networked activities and the responsibility system. On the other hand, it seems that the 2010 Mineral Strategy and the Sustainable Extractive Industries Action Plan of 2013 do not otherwise necessarily guide the activities anymore. In fact, the question arises whether these strategies should be updated or overhauled. National and various EU-level strategies could also be coordinated with each other more effectively.

Finland presented its national battery strategy in early 2021. Batteries play a key role in the achievement of climate targets. Finland has also worked to improve the added value of battery minerals and battery industry. The key strategic objective of the state-owned Finnish Minerals Group is to develop an electric car battery value chain in Finland.

Circular economy solutions for the mining sector can be used to implement circular economy policy objectives. However, most of the circular economy solutions are still on a trial basis. The problem is to make these solutions more widely and systematically available.

In order to be commercially successful, a mining company must gain the acceptance of the local community (social licence to operate, SLO).  Gaining local acceptance is not always a straightforward matter. There may be major differences between operating practices of mining companies and they sometimes fail to receive the social licence to operate.

In the past, many Finnish mines were abandoned and closed using methods that do not meet today’s environmental and safety standards. In Finland, the state of closed and abandoned extractive waste sites has been examined in the KAJAK projects since the 2010s. A number of projects to reform the environmental liability legislation applicable to mining operations are also under way.

This is not an audit report. Instead, it is a landscape review that examines sustainable mining from many different perspectives. The report therefore does not present audit recommendations. However, the last subsection of each chapter of the report discusses opportunities for development.

Written material was used as sources and a large number of interviews with mining and mineral industry experts were carried out. Mining companies and experts also provided the NAOF with valuable information in writing. Written material was used as sources and a large number of interviews with mining and mineral industry experts were carried out. Mining companies and experts also provided the NAOF with valuable information in writing. Written material was used as sources and a large number of interviews with mining and mineral industry experts were carried out. Mining companies and experts also provided the NAOF with valuable information in writing.

Deutsch — Nachhaltigkeit: soziale, umweltbezogene und innovative Aspekte bei der Vergabe

1. Die Bundesregierung hat im Jahr 2010 das „Maßnahmenprogramm Nachhaltigkeit“ beschlossen. Es richtet sich an alle Behörden und Einrichtungen der unmittelbaren Bundesverwaltung und gibt für elf Bereiche konkrete Maßnahmen vor.
2. Das Maßnahmenprogramm ist Teil der Deutschen Nachhaltigkeitsstrategie. Es fordert u. a. eine weitere Ausrichtung der öffentlichen Beschaffung am Leitprinzip einer nachhaltigen Entwicklung im Rahmen der geltenden rechtlichen Bestimmungen und unter Beachtung des vergaberechtlichen Wirtschaftlichkeitsgrundsatzes.
3. Das reformierte Vergaberecht lässt die Einbeziehung von sozialen, umweltbezogenen und innovativen Aspekten im gesamten Vergabeverfahren zu.

Der Bundesrechnungshof hat geprüft, ob und wie das Beschaffungsamt des Bundesministeriums des Innern diese  Aspekte unter Beachtung der Nachhaltigkeitsstrategie der Bundesregierung wirtschaftlich umsetzt.

English — Sustainability: social, environmental and innovative aspects in procurement

1. In 2010, the federal government adopted the “action programme on sustainability”. It covers all government departments and institutions and sets forth actions for eleven areas.
2. The action programme is part of Germany’s national sustainable development strategy. It requires, for example, for public procurement to comply with the guiding principle of sustainable development within the limits set by legal provisions and the value-for-money principle.  
3. The revised procurement law makes it possible to consider social, environmental, and innovative aspects throughout the entire procurement procedure.

We examined the procurement agency's mission performance within the Federal Ministry of the Interior, Building and Community is in line with the national sustainable development strategy and the value-for-money principle.

Deutsch — Nachhaltigkeit: soziale, umweltbezogene und innovative Aspekte bei der Vergabe

1. Das Beschaffungsamt muss die Berücksichtigung von Nachhaltigkeitsaspekten sicherstellen. Es sollte seine Dienstanweisung für Beschaffungen um entsprechende Vorgaben, auch solche für die Recherche zu Nachhaltigkeistsaspekten, ergänzen.
2. Es muss sein Personal regelmäßig zum Thema "Nachhaltigkeit" schulen.
3. Das Beschaffungsamt muss auch Nachhaltigkeitsaspekte, die sich nicht unmittelbar finanziell auswirken, im Vergabeverfahren angemessen berücksichtigen und gegenüber dem Preis gewichten.
4. Nachhaltigkeitsaspekte müssen ebenfalls in der Wirtschaftlichkeitsuntersuchung berücksichtigt werden.

English — Sustainability: social, environmental and innovative aspects in procurement

1. The procurement agency needs to ensure that sustainability aspects are taken into account. To this effect, it should update its procurement instructions and add applicable requirements, including those to enabling information search on sustainability aspects.
2. The procurement agency needs to train staff members at regular intervals on “sustainability”.
3. The procurement agency also needs to adequately weigh sustainability aspects having no direct financial impact in the awarding procedure against the cost.
4. Capital expenditure appraisals also needs to cover sustainability aspects.

Deutsch — Nachhaltigkeit: soziale, umweltbezogene und innovative Aspekte bei der Vergabe

1. Analyse relevanter Unterlagen und Berichte (Nachhaltigkeitsstrategie des Bundes, "Maßnahmenprogramm Nachhaltigkeit", Monitoringberichte, veröffentlichte Aussagen der geprüften Stelle)
2. Informationsgespräch mit der Kompetenzstelle für nachhaltige Beschaffung (zentrale Anlaufstelle für alle Bundesressorts, Bundesländer, Kommunen und sonstige öffentliche Beschaffungsstellen bei Fragen zur nachhaltigen öffentlichen Beschaffung)
3. Prüfung der angeforderten hausinternen Regelungen/Handlungsanweisungen
4. Bei den örtlichen Erhebungen Interviews und Auswertung von Akten sowie Dateien.

English — Sustainability: social, environmental and innovative aspects in procurement

1. Analysis of relevant documents and reports (National Sustainable Development Strategy; “sustainability action programme”; monitoring reports; statements published by the audited body)
2. Discussion held with the Competence Center for Sustainable Procurement (central point of contact: It offers advice on sustainable public procurement for federal, state and local government procurement offices and other public agencies)
3. Review of the required internal rules/instructions
4. During field work: interviews, and analysis of paper-bound and electronic documents.