Minister of Communications Authority to Prescribe Fees Order — 2
e Main Estimates plus sector overhead plus services provided without charge by other government departments less formula indirect overhead recoveries from the Department of National Defence. Overhead costs are to be applied as a percentage on direct labour which consists of the basic annual salaries/wages plus shift premium and fringe benefits. As overhead costs for the next fiscal year will be known at the time of preparing the Operating Budgets and New Year Main Estimates, the overhead rate will be calculated at this time by the Comptroller’s Branch. The total overhead costs derived from the Operating Budgets will be divided by the total direct labour cost as defined above to arrive at the percentage to be applied. For fee schedule purposes then, this overhead rate will be applied to the direct labour cost associated with any one service. Interest on the Undepreciated Capital Cost — The interest rate to be used is the current long term borrowing rate as established by the Government Finance — Loans, Investments and Guarantees Section, Economic Programs and Finance Branch, Department of Finance. This rate is to be applied to the undepreciated capital cost of the equipment in question, i.e., annual interest expense = capital cost less accumulated depreciation times the long term borrowing rate. Maintenance — Maintenance costs on equipment include the labour costs of the individuals employed for the express purpose of maintaining the equipment. The amount of yearly maintenance labour to be charged against a given piece of equipment should be pro-rated based on the expected time spent during a one year period. The other two cost components of equipment maintenance are materials and direct expense. Material cost would be such items as the cost of replacement parts for a piece of equipment while an example of direct expense is maintenance contracts. Both these cost components should be estimated for a one-year period. Money Paid to Canada for Special Purpose — Includes all money that is paid to a public officer under or pursuant to a contract, and is to be disbursed for a purpose specified in or pursuant to such a contract (FAA.2). Private Sector — All parties and organizations other than those included in the definition of the Government of Canada as an accounting entity. The Private Sector therefore includes those Crown corporations listed respectively in Schedules C and D of the Financial Administration Act , those Crown corporations not subject to the Financial Administration Act , all individuals, corporations, universities, provincial governments, municipal governments, foreign governments, international organizations, etc. Space — Where certain pieces of equipment occupy a large area, an appropriate portion of the building cost in which it is housed must be allocated to it. Where the buildings are owned by the Department, the yearly expense would be the annual carrying cost which will be calculated annually by the Comptroller’s Branch as follows: Capital cost of the building × Capital Recovery Factor = annual carrying cost. The capital recovery factor is used to calculate what the equivalent of a present sum of money would be expressed in terms of equal annual installments over a specific number of years. The formula is: R = P [((i) (1 + i) n ) / (1 + i) n - (1))] where R = annual installment P = present sum of money i = interest rate n = number of years. The interest rate to be used will be the current long term borrowing rate as established by the Department of Finance. The number of years will be the estimated useful life of the building. This annual cost will be divided by the square feet of the building multiplied by the square feet the equipment occupies.