R-2.2.0.1 - Act to reduce the debt and establish the Generations Fund

Updated to 12 June 2010

This document has official status.

chapter R-2.2.0.1

Act to reduce the debt and establish the Generations Fund

1. For the 2025-2026 fiscal year, the debt representing the accumulated deficits must not exceed 17% of Québec’s gross domestic product, and the gross debt must not exceed 45% of gross domestic product.

2006, c. 24, s. 1; 2010, c. 20, s. 52.

1.1. The debt representing the accumulated deficits is the accumulated deficits figuring in the Government’s financial statements plus the balance of the stabilization reserve fund established under the Balanced Budget Act (chapter E-12.00001).

2010, c. 20, s. 52.

1.2. The gross debt is the sum of the following assets and liabilities:

(1)  the balance of the Generations Fund;

(2)  debts before deferral of exchange gains or losses; and

(3)  liabilities with regard to pension plans and other future employee benefits.

The gross debt for a fiscal year does not include loans contracted by the Minister of Finance for the following fiscal year, nor the portion of advances made to the financing fund established under the Act respecting the Ministère des Finances (chapter M-24.01) and used to fund bodies not subject to the first paragraph of section 89 of the Financial Administration Act (chapter A-6.001) and government enterprises listed in Schedule 3 to that Act.

2010, c. 20, s. 52.

2. A Generations Fund is established at the Ministère des Finances.

The Fund is dedicated exclusively to repaying the gross debt.

2006, c. 24, s. 2; 2010, c. 20, s. 53.

3. The Generations Fund is made up of

(1)  the sums derived from the lease of hydraulic power under section 3 of the Watercourses Act (chapter R-13) and the sums derived from the development of hydraulic power under sections 68 to 70 of that Act and the development of water power under section 32 of the Hydro-Québec Act (chapter H-5);

(2)  sums representing a part of Hydro-Québec’s earnings on the sale of electricity outside Québec as a result of increased generating capacity, subject to section 15.2 of the Hydro-Québec Act;

Not in force

(3)  sums derived from fees or charges for water withdrawal, except sums paid into the Green Fund under paragraph 5 of section 15.4 of the Act respecting the Ministère du Développement durable, de l’Environnement et des Parcs (chapter M-30.001);

(4)  sums derived from the sale of government assets, rights or securities;

(5)  the sums deposited under section 41.1 of the Public Curator Act (chapter C-81);

(5.1)  the sums paid into it under sections 4 and 4.1;

(6)  the gifts, legacies and other contributions received by the Minister that the Minister pays into the Fund to reduce the gross debt; and

(7)  the income generated by the investment of the sums making up the Fund.

Water-power royalties from Hydro-Québec are payable out of production revenue.

The Government establishes, under the conditions it determines and on the recommendation of the Minister, the part of the sums or revenue under subparagraphs 2 to 4 of the first paragraph that must be paid into the Fund.

An order establishing the sums referred to in subparagraph 2 of the first paragraph must be made on the recommendation of the Minister, in consultation with Hydro-Québec.

2006, c. 24, s. 3; 2009, c. 38, s. 23; 2010, c. 20, s. 54.

4. Despite section 5 of the Financial Administration Act (chapter A-6.001), the Government may, under the conditions it determines and on the recommendation of the Minister, order that a part, which it establishes, of any sums it collects or receives and over which Parliament has the power of appropriation, is to be paid directly into the Fund.

2006, c. 24, s. 4.

4.1. Subject to section 6 of the Balanced Budget Act (chapter E-12.00001), the Government may, on the conditions it determines and on the recommendation of the Minister, use the stabilization reserve fund established by that Act to pay sums into the Fund. The sums are taken out of the consolidated revenue fund.

2009, c. 38, s. 24.

5. The Minister is responsible for the administration of the Fund. The sums making up the Fund are credited to the Minister, who must deposit them with the Caisse de dépôt et placement du Québec.

The expenditures relating to the Fund are charged to the Fund.

The Minister keeps the Fund’s books and records the financial commitments chargeable to it.

2006, c. 24, s. 5.

6. The Caisse de dépôt et placement du Québec manages the sums derived from the Fund in accordance with the investment policy the Minister determines in collaboration with the Caisse. The policy is designed to achieve optimal return on the sums making up the Fund while contributing to Québec’s economic development.

2006, c. 24, s. 6.

7. The Minister may take any sum making up the Fund to repay the gross debt.

2006, c. 24, s. 7; 2010, c. 20, s. 55.

8. Sections 26, 27 and 89 of the Financial Administration Act (chapter A-6.001) apply to the Fund, with the necessary modifications.

2006, c. 24, s. 8.

9. Despite any provision to the contrary, the Minister must, in the event of a deficiency in the consolidated revenue fund, pay out of the Generations Fund the sums required for the execution of a judgment against the State that has become res judicata.

2006, c. 24, s. 9.

10. The fiscal year of the Fund ends on 31 March.

2006, c. 24, s. 10.

11. The Minister must report to the National Assembly, in the Budget Speech, on the evolution of both the debt representing the accumulated deficits and the gross debt, on the sums making up the Fund and on any sums used to repay the gross debt.

2006, c. 24, s. 11; 2010, c. 20, s. 56.

AMENDING PROVISIONS

12. (Amendment integrated into c. A-6.001, s. 86).

2006, c. 24, s. 12.

13. (Amendment integrated into c. C-81, s. 41.1).

2006, c. 24, s. 13.

14. (Amendment integrated into c. E-12.00001, s. 2).

2006, c. 24, s. 14.

15. (Amendment integrated into c. H-5, s. 16).

2006, c. 24, s. 15.

16. (Amendment integrated into c. H-5, s. 32).

2006, c. 24, s. 16.

17. (Amendment integrated into c. R-13, s. 3).

2006, c. 24, s. 17.

18. (Amendment integrated into c. R-13, s. 68).

2006, c. 24, s. 18.

19. (Amendment integrated into c. R-13, s. 69.2).

2006, c. 24, s. 19.

20. (Amendment integrated into c. R-13, s. 69.3).

2006, c. 24, s. 20.

21. (Amendment integrated into c. R-13, s. 70).

2006, c. 24, s. 21.

TRANSITIONAL PROVISIONS

22. For the calendar year 2007, half the charges payable by the holders of hydraulic power, except Hydro-Québec, under section 68 of the Watercourses Act (chapter R-13) as amended by section 18 of chapter 24 of the Statutes of 2006, or under any order or contract under section 3 of the Watercourses Act, is paid into the Generations Fund. The other half of the charges is paid into the Consolidated Revenue Fund.

The charges on hydraulic power payable by Hydro-Québec for that year are halved and are paid into the Generations Fund.

2006, c. 24, s. 22.

FINAL PROVISIONS

23. The Minister of Finance is responsible for the administration of this Act.

2006, c. 24, s. 23.

24. (Omitted).

2006, c. 24, s. 24.

REPEAL SCHEDULE

In accordance with section 9 of the Act respecting the consolidation of the statutes and regulations (chapter R-3), chapter 24 of the statutes of 2006, in force on 1 January 2007, is repealed, except section 24, effective from the coming into force of chapter R-2.2.0.1 of the Revised Statutes.