OTTAWA — Statistics Canada, already reeling from the long-form census debacle, is chopping at least five surveys after being ordered to find $7 million in savings.

The beleaguered agency plans to drop a pair of environmental surveys, a health report and two sets of business statistics, along with other measures to meet budgetary demands from the Conservative government.

"If we keep going down this path ... we are at serious risk of eroding the quality of our statistics to unacceptable levels," Munir Sheikh, then chief statistician, warned in a May 31 letter to Treasury Board weeks before he quit his post over the long-form census controversy.

"Our collections systems are becoming outdated, we have less than optimal levels of automation of our processes and we suffer from a lack of proper documentation that can be risky."

The dropped surveys, as well as cuts in the amount of analysis conducted by the world-renowned agency, have already trimmed more than $1 million, but the bulk of the savings will come in the following two years.

Sheikh said the agency for too long has dealt with budgetary pressures by carrying out work more efficiently rather than eliminating work altogether.

"Eliminating less important programs, we have not been successful at all," he wrote to Michelle d'Auray, secretary of the Treasury Board. "This is because every time such an item is identified, we come under pressure to reverse our decision."

The letter, along with other documents outlining the StatsCan budget crunch, were obtained by The Canadian Press under the Access to Information Act.

The agency's money woes deepened last week when Treasury Board President Stockwell Day announced a government-wide deal with the Public Service Alliance of Canada for wage increases of 5.3 per cent over the next three years.

The deal with several of PSAC's bargaining units still must be ratified. But all departments and agencies -- including StatsCan -- have been told to find room within existing budgets to pay for wage increases rather than expect additional funds.

The agency also bargains directly with 1,750 interviewers it employs. The deal with this PSAC unit expires in December next year and one background document from StatsCan says "we hope to negotiate wage rate increases of 0%."

Agency spokesman Peter Frayne, however, denied there was any such negotiating strategy.

Chopping the five surveys is expected to trim some $4 million, while cutting the amount of analysis is worth another $1.5 million. Frayne cautioned that if outside funds become available, the work might be revived.

"At this point, no alternative sources of funding have been confirmed that would offset any of the proposed analytical or survey program reductions, although this remains a possibility," he said in an email.

The ditched surveys are: the Industrial Pollutant Release Survey, and the Quarterly Energy Use and Greenhouse Gas Emissions Survey, both pilot projects; the National Population Health Survey; the Survey of the Suppliers of Business Financing; and the Survey on Financing of Small and Medium-Sized Enterprises.

Sheikh's letter said the two environmental surveys lack support from Environment Canada, and the rest are covered to a certain extent by other data.

Matthew Bramley of the Pembina Institute said he was not yet aware of the pilot environmental surveys, but said the agency might have been trying to respond to criticisms that a similar Environment Canada survey contained unreliable data.

The agency was dealt a blow this year when cabinet decided to dump the mandatory long-form census scheduled for next year, replacing it with a voluntary survey. Tony Clement, the minister responsible for Statistics Canada, said the long-form was an unnecessary invasion of privacy and that many ordinary Canadians object to it -- though no clear evidence for the claim has yet been produced.

The census is StatsCan's most important project, and Sheikh chafed at erroneous claims by Clement that the agency viewed the survey as nearly equivalent to the mandatory census.

"I want to take this opportunity to comment on a technical statistical issue which has become the subject of media discussion ... the question of whether a voluntary survey can become a substitute for a mandatory census," Sheikh wrote in his resignation letter July 21. "It can not."

Statistics Canada was originally given $630 million to carry out the May 2011 census, including the mandatory short and long forms. After cancellation of the mandatory long-form census, that budget was split -- $550 million for the short-form and $80 million for the voluntary National Household Survey, which a broad range of critics say will produce unreliable data, and under-represent the poor and marginal.

To alleviate those concerns, Industry Canada officials said StatsCan would receive an additional $30 million for helping to improve the response rate. But the agency says it has not received any extra money.

"The government has not approved additional funding at this time," Frayne said.

Officials at Industry Canada were not immediately available for comment.

Statistics Canada's 2010-2011 budget, not including the special census fund and money from selling its data, is $407 million. The agency earns about $100 million each year from sales.