The policy requires assistant directors to ensure that the administrative requirements imposed on recipients are proportionate to the level of risk associated with the payment of a particular transfer. The directive goes further with regard to transfers to Aboriginal beneficiaries. In this regard, department heads must ensure that there is a focused and sustainable leadership role in reducing administrative requirements. This requirement recognizes that, given the wide range of programs offered to Aboriginal people by many departments, administrative requirements under multiple funding agreements can become a significant burden for Aboriginal people and efforts are needed to reduce this burden. The Transfer Directive requires that a financing agreement be concluded with each recipient before a payment is made; this includes any payment as a payment or advance. An exception is granted to a contribution to an international organization that can be made without a funding agreement if it is due and requested by an international organization, provided it complies with the agreed terms and conditions. There are about 5,000 not-for-profit organizations that currently have agreements with several provincial departments, but each is administered separately. The number of transfer contracts could be immediately reduced by 14 per cent – without cuts to services or jobs – simply by framework contracts. Optimized, results-based agreements can reduce administrative costs for both public and non-profit organizations. In Canada, the federal government makes payments to less prosperous Canadian provinces to offset the provinces` “fiscal capacity” – their ability to generate tax revenues. The program began in 1972.  In 2016-17, six provinces will receive $17.9 billion in federal compensation.
 Until 2009/2010, Ontario was the only province that had never received compensation; In 2009-10, Ontario received $347 million, while Newfoundland, which has received payments since the program`s inception, is now a so-called “Have” province and is now a net contributor and receives no payments. Compensatory payments include non-prosperous provinces that make direct payments to poor provinces, since the money comes from the federal treasury. For example, a prosperous Quebec citizen, a province known as “don`t,” pays more taxes in the federal system and funds more compensation than a poorer alberta citizen who pays less federal taxes, a province known as “having.” As Alberta`s population and prosperity increase, Albertans as a whole are net contributors to compensation, while the New Brunswick government, the citizens, are net recipients of offset payments. Department heads ensure that all amounts repaid by beneficiaries or recovered by beneficiaries are recognized as debts that accrue to the Crown and that appropriate measures are taken to recover. Funding agreements should provide that interest on outstanding repayments is collected in accordance with the Interest and Administrative Costs Regulations. [i] However, reasonable non-historical instalments that a beneficiary holds at the end of a fiscal year as part of the duration of a multi-year financing contract cannot be considered refundable on that date.