The Politics of Money: An IFSD Podcast

Welcome to the Politics of Money, the official podcast of the Institute of Fiscal Studies
and Democracy at the University of Ottawa.

Today we have Kevin Page and Mostafa Eskari, talking about the new appointment of, or
rather the nomination of the new candidate for Parliamentary Budget Officer.

Kevin?

Yeah, thanks Sahir.

Interesting day.

It's a time where we can reflect.

And who better to reflect with than Sahir and Mostafa, who helped set up the original PBO
in 2008.

There's a bit of deja vu for me, because it does feel like this is a really important
time, an important appointment.

What do you think, Mostafa?

No, absolutely.

It is an important time because of the significant changes that are happening globally and
definitely for Canada.

Certainly, they need independent assessment and analysis that the Parliamentarians can use
when they are debating some of these issues.

So, Sahir, when we started out in 2008, obviously, Mostafa, you were there.

You might have had a few more people, but I mean, it's not the same office it was in 2008.

A lot's changed.

Yeah, I think we were working out of a Starbucks at the Sun Life building, so it was a
little different.

We were

building while we were trying to produce reports.

I think what maybe was similar in the environments is every time you get an appointment or
a nomination of a new Parliamentary Budget Officer, there's an almost, there's a reflex as

to from Parliamentarians, do we trust this person?

And are they gonna be competent and the like?

And I think this is no different.

I think we came out, if you remember our first committee hearings,

you know, even our friends in the public service were like, wow, you two just came out of
the Privy Council office.

That's like the worst place to show up to Parliament from.

And so, you know, I think the distrust we learned is a little bit natural and it's
probably up to the character and personality of the nominee to kind of uh overcome that.

I Kevin, I don't think it was different for the three of us.

So, ahead, Mostafa I think also the fact that PBO has changed significantly in terms of
the size.

And we started with four or five people and now they have over 40 people.

It's a different organization.

How to manage it, how to make sure that people are motivated to do the work and all those
kind of management HR issues are actually quite important now.

Yeah.

So do we feel collectively that PBO is at a place now to meet the moment, right?

The moment being

well, to quote the prime minister, a rupture in terms of our international order, in terms
of very weak economy, dealing with a massive trade shock from the United States.

Looking ahead, dealing with this incredible changes in technology.

A day doesn't go by where we don't hear something about AI and what it's going to do to
the labor market.

Is the PBO now, with the bigger size PBO, the stronger legislation, thanks to Prime
Minister Trudeau,

and the appointment of Annette Ryan.

Do you think it's ready to meet the moment?

Yeah, I think it is for a couple of reasons.

You talk about the scale.

I think that

matters. The OECD just completed a report saying that this is a solid organization, a
leader among its

peers. I think the challenge for any Parliamentary Budget Officer is kind of recognizing
the context in which they're

operating in. And this is a

We had a particular environment that was difficult, a lot of distrust to overcome on, I
would say, in all kinds of corners.

But I think on the other hand, you've got a candidate that is pretty seasoned,

right? Annette Ryan has run large organizations, she's built analytical teams, she's
worked at the centre of Government and budget

Making. I don't think there is a training course for how to be a Parliamentary Budget

Officer. I think you can just try to find

that have the qualifications and have a sense of sufficient independence to do the work.

My guess is for, and that's probably your last job, right?

This'll be the one that you know ends our public service career at the end of it, and
maybe that's a healthy thing too.

Yeah, I think I would say there are two aspects for the PBO.

We need it or we really right now, at this moment, we need it.

There's an issue of the staff and the technical side of the office, that you need people
that are competent, people with the right background, and all that.

Then the other side of it is the leadership of the organization.

And I don't know, Ryan has never worked with her, but from her background and what she has
done in the past, when I look at the CV, obviously she has all the qualifications that you

need for being in charge of that organization.

How she is going to behave, How she is going to approach this, that is something that we
have to see over next few months or a year and see how she's going to actually act in that

position, which is an extremely difficult position from many respects.

We all know that.

We have been there.

Yeah, so for me, I think Annette Ryan is a great choice.

And we all collectively know that the Prime Minister's Office started the recruiting
exercise months ago, that it was led by a very senior retired official from Department of

Finance who went out, tried to a big, a good pool of candidates.

They did that.

They got down to a couple of significant names.

They chose Annette Ryan.

so for me, to have somebody like Annette Ryan who's worked in all three central agencies,
finance, treasury, the privy council office that's been involved in the Budget process, ah

somebody that has degrees in mathematics and economics, that's just like from a credential
perspective, it's fantastic.

Also somebody that really did research at Industry Canada, looking at that connection
between

the private sector and the public sector is terrific.

know, Sahir and I also had an opportunity to work with Annette side-by-side for a few
years when we were at the Privy Council Office providing a daily economic and fiscal

analysis to the Prime Minister, to Cabinet, and to the Clerk of the Prairie View Council
Office.

And I think we saw there that a very strategic, very smart person, um a great
communicator,

Somebody really with an independent voice.

I just think when, you in the days and weeks ahead when, you know, she gets in front of
committees and she gets in front of the media, I think they're just going to soak it up.

And because she has this charm, she has grace, she has this sort of background, her family
comes from Newfoundland, P.E.I., she has real character.

So I think we got, we absolutely have the right candidate.

We all know that the PBO is in a highly political situation around it.

Everybody talks about politics, there are political issues,

but at the same time, PBO is an independent non-partisan organization.

Keeping that balance and making sure that you're not going to get involved in the politics
of is extremely important.

Well, remember the advice we got from the Congressional Budget Office friends, which was
that every report, well, half the people will love it and half the people will hate it.

The problem is it'll be different half each time.

Yes, absolutely.

And so never get comfortable.

So when we were building the office in 2008,

Canada was still in the midst of this engagement in Afghanistan.

By the time we got to the fall of 2008, there was a sense that we were entering a
financial crisis.

Mr.

Khan puts out a report on the costing of Afghanistan in a report that I think shocked a
lot of people.

And for many reasons, just the fact that, you know,

a Library of Parliament would put out a report through the Parliamentary Budget Office,
that kind of costing.

And then shortly after that, Mostafa Dr.

Askari puts out a report basically telling Parliament and Canadians that we're headed for
a recession.

Obviously, PBO got out of the gates and wanted to be very relevant.

And now what do you think, like in terms of Annette Ryan and PBO as we entered, here we
are in 2026,

we have an ongoing war in the Middle East.

We have concerns of very weak growth and higher inflation, higher oil prices.

What do you think are some of those critical issues that she, Annette Ryan is a new PBO
appointee and the PBO are going to face in 2026?

Well, I think the government's agenda is going to be one.

I think it inherited a kind of a tough set of books, spending 16 % of GDP.

Broadly sustainable, but kind of pushing the edge and then having to embark on an
aggressive agenda to protect Canada's sovereignty.

That's a tough set of cards for the government.

And when you're in the PBO, I think that the risk is you can't just stand back and well,
it's all needed and let's be supportive.

I think you have to help Parliament actually understand whether there's a plan, whether
it's

sustainable. Is there sufficient disclosure for them to

Budget Bills, appropriations.

All those things, the money that makes this stuff work.

We talk about the politics of money.

Well, all this money has to be appropriated by Parliament no matter what and there's a
level of scrutiny that's required.

That being said, I think also for the PBO, there probably has to be some important chalk
lines that are established.

Certainly costing the measures, making sure that Parliament understands what the fiscal
impacts are going to be of these measures and then overall, are they

I think the risk is getting involved in the policy and politics of the individual
measures, which was always something, Kevin, you kept us away from.

We were always stuck with politics of Parliament, but you always want us to stay far away
from the policy measures and the political opinion and stick to things that were fiscal

and economic.

That helped, know, Parliamentarians could lead the political debate, the policy debate.

We would just provide support on

on the money part.

Yeah, so and Mostafa just to set you up a little bit more,

like you came out in the fall of 2008, right after the election of that, you know, of
Prime Minister Harper, and you came out with report basically saying we're headed for

recession and deficit and the government wasn't there.

They didn't talk about anything of the nature of that nature in the 2008 election
platform.

Do you think there's a possibility that PBO

could have a big impact on the planning outlook at this time?

Of course.

I think there are two aspects of PBO.

We all know that.

It's the economic issues and the projection where the economy is going, especially in the
current context where there's huge uncertainty as to what is going to happen next month,

next two months, next year.

And we don't know.

I mean, the global economy could be in a recession because of what is happening right now
in the war in the Middle East.

So that's extremely important.

Now, projections and forecasts are forecast.

There are always errors, then when people have to accept that.

But that provides a planning environment for the Parliament to discuss these things, which
also affects the fiscal situation, which again is the other side of this, whether this is

going to affect the fiscal, whether it's going to affect the government's revenues, that
will cause more deficit, and that could affect the sustainability of the fiscal situation.

So all those things together I think are extremely important for the new Parliamentary
Budget Officer to consider.

It's going to be an extremely difficult job for the next year or so.

But it is what it is and it is really needed.

So Mostafa, can I maybe ask you just this issue of also with all this complexity
separating what's under the control of the government versus where the Canada is just

subject to all those global

forces geopolitical, economic.

That's going to be important because I think one of the issues that I think we learn very
slowly is that forecast and estimates without context actually can, know, Kevin, you

always said we should bring light, not heat.

That sounds like a nuance, but it's kind of really important maybe to help
Parliamentarians.

And how does the PBO do that, Mostafa.

I think it's one thing, one advice if I can give to Annette Ryan is that when you go to
committee and

Parliamentarians ask you questions.

Most of the time when they ask you question, we know that there is a narrative there that
they're trying to put out there, which is their view of what is happening.

And if I think one of the jobs that's the way I did it when I was in front of the
committee, if I sense that somebody is putting words into my mouth by providing that

narrative, I would challenge that.

right at the committee.

It's not that you're not going to fact check them, but you want to make sure that they do
not put you in a situation where you think what they're saying is right.

You're just providing further clarification of it.

You have to provide that kind of a challenge to Parliamentarians.

Because their job hardly is also political narrative.

They want to put a message out there that this is the way that they are thinking about
that topic.

So it's absolutely important for the Parliamentary Budget Officer to provide that kind of
assessment, that kind of clarification of the issues that, as you were suggesting, there

are issues that are not under control of the government.

Highly technical issues in terms of inflation, other things that government does not have
a full control over those kind of things.

So part of the job of the Parliamentary Budget Officer is also to educate those people and
the public on some of those issues.

Okay, so just if we can close on this, because we got a very good OECD review of the PBO
of Canada.

You think about where we were in 2008, this is a dream scenario.

To say a few decades later, the OECD would be comparing Canada with...

the Congressional Budget Office and the Great Office in the Netherlands, like two long
standing, terrific offices.

So obviously PBO has come a long way, but PBO is also headed to this sort of difficult
time, not just the PBO, but Canada.

And I just want like, if you guys could just share some thoughts on after that good
report, like obviously the office needs to be strengthened.

Some ideas in terms of how we can strengthen the office so we will meet the moment,

of next year to two years?

I think one big difference when we started was, Kevin, you spent a lot of time recruiting.

I mean, the first thing you did was take people out of the three central agencies who had
done this work before.

And I can't count how many times you were at Starbucks downstairs interviewing a future
candidate and you were always looking for the continuity in the office.

And I think that would be number one for

for Annette Ryan, the nominee, is to be continually building.

I think your example of the CBO is a good one because in spite of it being kind of the
dean of Budget offices, its future has never been 100 % assured.

There are folks in Congress that have tried to shut it down, cut their Budget.

So all that volatility that we faced in Canada initially, I think the new PBO has to
assume that some of that's going to always continue.

It's always part of

an office that's a little bit disruptive to political narrative, right?

And so having a thick skin I think is really important.

But I think to also assume that every Parliamentary Budget Officer is a builder.

They've got to stamp the institution in their own image.

Forget about what any of us did before.

The context is different.

The scale is different.

But also one thing that continues is making sure you have really good people to do the
work.

And, you know, I think you

in some ways you kind of keep your head down about the politics and policy and you just
try to provide the best reports.

I mean, you made the comment about, you know, those two reports and us wanting to have an
impact.

I think I would disagree a little bit in that I think we were just scared enough all the
time to just make really good reports, the best ones we could.

then kind of let the chips fall where they may afterwards.

And I think that became a part of our culture.

And I think it was probably the best part of our culture was that all people really cared
about was producing

reports.

You know, I think the OECD review gives a little bit of guidance as well that, you know,
we did a lot of peer review on things that we thought we didn't understand.

On the costing.

And we were, I guess, a little scared all the time.

And maybe that was healthy.

Maybe encourage the nominee to think about that.

Mostafa, like you were, you literally for PBO built an independent capacity to do the
economic and fiscal outlooks,

to do fiscal sustainability.

And my recollection was there was some real substance of your reports.

They were thick reports for the most part.

They were executive summaries, and you would go in front of committee and explain the
outlook and the risks, et cetera.

When you look at the template that's at PBO right now, are you happy with that template?

No, think there is an issue.

There are two aspects to that.

One of them is PBO is getting a lot more requests these days than we did when we were
there.

And part of it is because of the legislation that they need, the legislation that they
have to do it.

And part of it is maybe they have chosen to do that.

Some of the reports really, it's not their

job. They shouldn't be doing

that. The Library of Parliament can provide those kind of uh

assessment. So that's one part of

it. The other part is they have moved in that direction of smaller reports with less

And I think this is a major issue, as what Sahir was saying, instead of peer review, and
then what the OECD review also suggested was that there are certain issues that require a

lot more analysis and a lot more details, and even a peer review for those reports.

I mean, a Parliamentary Budget Officer has to understand the political dynamics of the
situation.

If they are putting out a report there that they know is going to be heavily used by the
politicians and it becomes a very important report, then they have to be really careful

about what they're going to put out there.

And peer review is one part of that.

Also provide enough analysis that you can actually cover all the grounds around that topic
to make sure that if Parliamentarians are debating that, it's not going to be one-sided,

because of the way that report has been drafted.

Well, I will close by saying, if somebody would have said when we were building that
office, and literally building the office around a Starbucks in downtown Ottawa, and that

we would be here today in 2026 with the nomination of a great person to lead the PBO with
an OECD review that puts us up there, literally on the podium, so to speak, of legislative

Budget Offices,

in the country, we'd be feeling pretty good.

Just consider that when we started, within six months, we thought we were going to be
closed down by the government.

And now the PBO has become a major institution.

It's probably the only independent institution in Canada that has the capacity to do all
this work that they are doing on the technical side,

We don't have any other think tank that they have that kind of a technical capacity to
provide that kind of reports in Canada.

And that by itself, I think for us, it's a good thing to see after all this.

I think we should also maybe think back that we have three prime ministers that we
probably have to all.

applaud to do something incredibly against their political instinct.

Prime Minister Harper for creating an office to begin with.

That really goes against any political instinct.

Prime Minister Trudeau for fixing the legislation significantly.

It might be a few rough edges.

And then I think Prime Minister Carney for not putting in somebody who isn't qualified,
for not putting in an administrator.

And that says something about

them as their character, which which I, you know, I think is really good.

But it probably also points to Mostafa's observation that the PBO is now important enough
that people want to improve it, that want to put the right nominees to serve Parliament

because it matters.

And maybe that's kind of, you know, for us, you know, a little bit of that legacy.

Every PBO and deputy PBO probably has an important contribution to make, but kind of glad
we're here.

Yeah.

Thanks for listening for Politics and Money.

Thank you.