:
I call the meeting to order. Pursuant to Standing Order 108, the Standing Committee on Human Resources, Social Development and the Status of Persons with Disabilities is meeting to follow-up the Auditor General's 2002 status report, chapter 1, “The Integrity of the Social Insurance Number”.
Before we start, I would like to take the time to acknowledge the presence of a delegation from the Audit Board of the Republic of Indonesia, led by its vice-chairman, Mr. Abdullah Zaini. Welcome.
Some hon. members: Hear, hear!
The Chair: The Office of the Auditor General is hosting a three-day visit of the delegation, for it to learn about the role and the work of the office and its relationships with key stakeholders.
We welcome all of you and are most certain that your visit will fulfill all of your expectations, as you are surely in very good hands.
Today we are receiving the Auditor General in follow-up to the letter she sent us on May 12, 2006, concerning the 2002 study on the integrity of the social insurance number. The Auditor General will make a brief presentation, and then she will be available to answer members' questions. It should take approximately 30 minutes, then Ms. Fraser will have to leave because of another commitment. The officials of the department will provide us with a briefing regarding work accomplished since the AG's study was released, and will also provide us with information on upcoming projects in regard to these issues.
Without further comments, I would like Ms. Fraser to give her presentation.
We thank you for this opportunity to meet your committee and to discuss our most recent audit on the integrity of the social insurance number.
I'm accompanied today by Nancy Cheng, the assistant auditor general in charge of this portfolio, and Sylvain Ricard, the audit principal for the portfolio.
We have been monitoring the management of the social insurance number for several years. However, our most recent audit work was reported in 2002. Our comments today are therefore based on observations from four years ago. Since then there have been major changes in the organization of the department that is mainly responsible for managing the social insurance number, Human Resources and Social Development Canada.
[Translation]
We initially audited the management of the SIN in 1998 and observed serious weaknesses in the process for issuing SINs and in maintaining the Social Insurance Register. We followed up in 2000 and found that the department had taken several measures to improve the management of the SIN and was planning more. When we looked again at progress in 2002, we concluded that the Department had not done enough to safeguard and strengthen the integrity of the SIN.
This Committee and the Public Accounts Committee undertook studies of the management of the SIN after the tabling of our report, and made additional recommendations.
In 2002, we made observations and recommendations in four areas: the role and use of the Social Insurance Number; the process for issuing SINs, the integrity of the Social Insurance Register; and the conduct of investigations of SIN-related fraud.
We observed that the Department was not limiting its uses of the SIN to those authorized by government policy. Under government policy, programs can only use the SIN if they are authorized to do so by legislation or with approval by Treasury Board. We reported that three programs in HRSDC were using SINs without authorization.
[English]
While these specific cases were clearly not consistent with policy, we also observed that government policies on the use of the social insurance number had not been updated since 1989 and were not entirely clear on how the number should be used. In that regard, we observed that it was unclear whether HRDC was using the social insurance number as simply a number to manage a client's file or also as a means to establish their identity. Properly identifying clients is a fundamental control of any government program. We reported that the Treasury Board Secretariat was undertaking a review of government policies related to the social insurance number.
With regard to the issuance of social insurance numbers, we found that the department's policies and practices did not meet the intent of the Employment Insurance Act and regulations. We found that the documents the department required before issuing social insurance numbers were not sufficient to prove both identity and citizenship; that staff lacked adequate tools and training to confirm that the documents presented were authentic; and that the 900-series social insurance numbers, intended for temporary use, had not expired.
We also reported that there was still a difference of five million, at that time, between the Canadian population according to Statistics Canada and the number of usable social insurance numbers listed in the social insurance register. While there could be valid reasons for a difference, we observed that HRSDC needed to explain the variances fully. As well, there were still more than eight million usable social insurance numbers in the register that had never been supported by proof of identity documents, because they had been issued before 1976. We recommended that the department set goals on how complete and reliable the information in the register should be, and to take steps to meet them.
Finally, we observed that the department had not done a comprehensive risk assessment to manage investigations of possible fraud related to social insurance numbers.
Each year we request updated information from all government departments on action and responses to our recommendations. This information is used to assess our performance and is reported in a summary form in our departmental performance report. Through this process, we have received updates on progress since 2002 by the department on how it has been addressing our recommendations on the social insurance number. We do not audit this information, but we do assess its plausibility based on other publicly available information and our ongoing knowledge of the department.
[Translation]
Information provided through this process indicates that actions remain incomplete on certain recommendations from the 2002 audit, including: obtaining authorization to use the SIN for all departmental programs that are currently using it; setting goals for the completeness and reliability of the Social Insurance Register; and implementing a means to check the validity of identity and citizenship documents with the issuing authorities.
I emphasize that these updates are not audited information. During the parliamentary committee hearings that followed the tabling of the 2002 report, we committed to conduct a further follow-up audit of the management of the SIN at a future date. We are currently planning that audit, and expect to report it next year. At the same time, we will be in a position to provide a more complete assessment of progress in responding to our 2002 recommendations. We welcome the Committee's views on any issues that may be of particular interest to it and that we should consider when we conduct this audit work.
Mr. Chairman, that concludes my opening statement. We would be pleased to answer your Committee's questions regarding our previous work or any other matter relating to our role, mandate and audit work.
Thank you.
:
I think you've raised a very good point. In that passport audit, we raised a number of issues about the process, and especially over security concerns, as the passport office wasn't paying enough attention to security issues, given the events of the past few years. I recall that we raised a question about the process they had with members of Parliament, but we certainly never recommended they stop doing this.
Our major concern was with the way the passports were being sent. If I recall correctly, they would put them on buses and send them out. We asked, is this really the best way of delivering these documents; is there not a more secure way of doing it?
Now, if they've completely eliminated that, it was the passport office's decision; we never made a comment in that area. I agree with you that there's a balance that has to be made between the security of the process and the delivery of service to Canadians.
We are actually in the process now of doing a follow-up to that passport audit. The department did come forward with an elaborate, very good action plan to address the weaknesses we had identified, and the public accounts committee had asked us to go back and do a follow-up fairly quickly. So I believe that is under way, and we can certainly look at the issue of service and how to address that.
With the social insurance numbers, again the concern is with the documents used in issuing those numbers and with the integrity of the registry. We recommended that the federal government explore ways of collaborating with the provinces in the vital statistics records, so when someone died, for example, the federal government would be advised of that and the social insurance number could be cancelled, so there'd be better use of other information that's already available.
:
Thank you very much, Mr. Chairman.
First I'd like to introduce my colleagues at the table. Hy Braiter is senior ADM, service delivery, responsible for integrity for the last year. Onno Kremers is director general of integrity.
We appreciate this opportunity to speak to you today about the integrity of the social insurance number. We believe the committee's invitation is timely, given the progress we have made on the recommendations of the Auditor General's 2002 report, and the 2003 report of this committee, on the management of the social insurance number program.
Overall, our objective is to establish a world-class system to manage the social insurance number. Such a system must have accountability built in throughout the process, be rigorous, contain accurate information, and ensure that Canadians can easily and securely get access to their benefits.
[Translation]
Responsibility for the management of the SIN is now with Service Canada, which is committed to improving the delivery of programs and services to Canadians. Service Canada is working with a growing number of federal departments, provinces and territories to move the one-stop service approach forward. Progress we have made with SIN is at the forefront of this approach. At the same time, we are committed to maintaining the integrity and confidentiality of Canadians' information.
[English]
We are accountable to our clients and to all Canadian taxpayers for our results. In fact, being accountable and reporting to Canadians annually on our performance is enshrined in our Service Canada charter. We believe that the progress we have made since 2003 is very significant in enhancing the integrity of the SIN process and the register itself.
To ensure accountability and transparency, we have initiated a review by an independent audit firm of the integrity of the SIN and the social insurance register. As well, this review will validate that both the SIN and the SIR are well positioned to fulfill their role as a foundation for the integrity of Service Canada's programs and services. We expect the results during the course of this summer and would welcome the opportunity to share these with the committee. We are working closely with the Auditor General on this review as part of their audit of the program.
Similarly, we recognize that we need to regularly report on our progress. This is what we have done through our annual reporting to Parliament using regular departmental reports on plans and priorities, and performance reports. In addition, we submitted a progress report to this committee in 2003, and annual updates to the Auditor General in 2003, 2004, and 2005.
We take the management of the SIN seriously and have made significant progress to ensure rigour in the entire SIN process: rigour in issuing a social insurance number to the right individual, rigour in monitoring the use of that number, and rigour in ensuring the highest level of integrity in the social insurance register.
We issue more than one million social insurance numbers a year. In keeping with Service Canada's commitments, we have re-engineered the entire process for issuing a social insurance number from end to end, introducing rigorous controls while improving the service to the client. We call the new service SIN Rapid Access.
Our improved SIN application service requires that all our front-line staff have training and certification in identity management. The process requires a face-to-face rigorous review of the applicant's identity and documentation before staff can take an application. Our new SIN Rapid Access process also supports staff with tools they need to make decisions and referrals on high-risk clients to our investigators. Furthermore, automation of the process reduces errors in data capture.
Clients can now apply and receive a SIN in person in one visit, versus a wait of three to six weeks. This makes a big difference to people entering the workforce or receiving other benefits. The service is currently operating in 193 of Service Canada's centres in every region of the country and will be fully operational in all Service Canada centres this fall.
We have also tightened our proof of identity processes that provide assurance that we have the right client. We now accept only original birth certificates and original immigration documents. Gone are the multiple documents we used to accept, such as baptismal certificates.
[Translation]
Underpinning the new SIN issuance process is a robust SIN/SIR quality assurance system which consists of rigorous controls that guide each step of issuing new SINs. This is yet another move to ensure our processes are robust so we know the information in the SIR is accurate.
[English]
More significantly, we are encouraging more rigorous and consistent use of the SIN through a SIN code of practice. It will provide guidance to all SIN users to safeguard the security and privacy of the SIN, and it will provide practical guidance and tools to assist in doing this. The code is designed for all SIN users: individuals, employers, the private sector, SIN partners, and Service Canada employees. We are currently undertaking a broad engagement strategy on the code with various consumer, employer, private sector, and government stakeholder groups. Following this, we hope to officially launch the code this fall.
As part of this process, we would welcome the committee's views. If you'd like, we can table a copy of the draft code with you.
Mr. Chairman, having accurate information in the social insurance registry is a critical requirement to Service Canada's objective to bring this important register up to world-class levels. To this end, we have reduced the variance between the number of living SIN holders and the size of the Canadian population to about 700,000 today. We have certified the accuracy of millions of SIR records by flagging them as deceased, dormant, or unusable; for instance, by eliminating those 900-series SINs that have expired. The 900-series belongs to people who are neither Canadian citizens nor permanent residents; for example, temporary workers or foreign students.
There are legitimate reasons why the number of SINs issued exceeds the total Canadian population. For example, there are Canadians who are living, studying, or working abroad, or foreign workers who have legitimate SINs but are no longer residing in Canada and are still eligible for CPP benefits. Also, there are Canadian pensioners who have decided to live abroad.
Our automated linkages with other government departments, such as Citizenship and Immigration Canada and the Canada Revenue Agency, and with provinces and territories for historical and ongoing, timely birth/death data will continue to enhance the accuracy of the SIR.
As recommended by this committee and the Auditor General, we have successfully negotiated agreements with New Brunswick, Ontario, and British Columbia so that we can validate documents automatically and electronically at their source. This means that when we receive an application for a SIN, we can automatically validate with the issuing province that this is a legitimate birth certificate, thus increasing the accuracy of the SIR.
These agreements currently cover approximately 54% of Canada's population. We are actively pursuing agreements with the remaining provinces and territories and hope to have most of these in place over the course of the next year. As you know, we already have secure links with Citizenship and Immigration so we can accurately identify 100% of permanent and temporary residents.
[Translation]
Finally, we are currently undertaking a benchmarking exercise to define levels of accuracy and completeness and set key performance indicators for the SIR using best practices from around the world, including those of the U.S. Social Security Administration. The results of this exercise will assist us in further improving the accuracy of the SIR.
[English]
In closing, the progress we have made in improving the integrity of the SIN program enables the service transformation that is at the heart of Service Canada: enhancing the accessibility of services to Canadians. We envisage issuing SINs to Canadians when they need them so that they can receive the easy-to-access services they are entitled to—when a newborn arrives in the family, when a newcomer arrives in the country, and when a young person needs one for work. At the same time, when someone dies, we will automatically deactivate the SIN and proactively provide survivors' benefits.
Just to give one example of how this is unfolding, through our links with vital events agencies, we are piloting an initiative in eight hospitals in Ontario that will offer a SIN at the same time as a birth is registered. Today, a parent cannot get a SIN, or a passport for that matter, without a birth certificate. Without a SIN, a parent cannot apply for a Canada learning bond or an educational savings grant. The SIN at birth offers parents the opportunity to combine three separate processes--birth registration, birth certificate application, and application for a SIN--all in one electronic process. We expect to roll out this service in all hospitals in Ontario early this fall, and in British Columbia too. In short, this is a fundamental shift in the way service is provided to Canadians, while enhancing the integrity of the process.
Thank you. We will be happy to address your questions or comments on what we've been doing to protect the integrity of the SIN and to provide better service to Canadians.
:
Thank you, Mr. Chairman.
I wish to point out that perhaps we can use the last round of questioning to recover the seven minutes we didn't get at the start. While you think about this, I'll use the five minutes allotted to me. You can let us know what you decide later.
If I go by your statement on page 7, I'd have to say there are no problems and no need to be concerned any more. In fact, you state the following:
And as you know, we already have secure links with Citizenship and Immigration Canada so we can accurately identify 100% of permanent and temporary residents.
If that's true, then there's no need for us to be concerned any more. However, this morning the AG told us that while some progress has been made, there are still 700,00 people who have a SIN, but whose entitlement to one has not been verified.
Getting back to the uses made of the SIN, you correctly stated that responsibility for the management of the SIN is now with Human Resources and Social Development. However, unless I'm mistaken, the policy governing the use of the SIN is still set by Treasury Board. So then, the department manages the SIN, while TB issues policy directives respecting the use of this identifier.
There continues to be a link between the use of the SIN and income programs. Therefore, the Department of Revenue is involved in this. For instance, each time a person takes out a loan or wants to deduct money from his taxes, the level of income always comes into play. Often, we're a long way off from the SIN's original intended use. Even video stores sometimes asks customers for their SIN. This only proves that there really are no safeguards in place.
Now that you have responsibility for the management of the SIN, have you talked to Treasury Board about bringing in safeguards and ensuring that the SIN is not used for other purposes? That's my first question for you.
Secondly, still with a view to making the system more secure, this committee, acting on an observation by the AG, issued 14 recommendations in 2002. In early 2003, the government announced that it planned to implement these recommendations, take appropriate action and report back to the AG and to the committee on progress made in implementing these measures.
Were these reports in fact produced? How often? Did the government report back to the committee on the progress made in implementing the measures you mentioned?
I'd appreciate an answer to these two questions. If I have any time remaining, or two additional minutes, I'll get back to you with another question.
:
Well, the first thing we did, of course, was clean up the data. We've linked with the provinces, as you've heard, and we're getting death information and historical information. For example, from Ontario we got at least five years' worth of historical data.
As we make agreements with each province, we're going to go back and match computer-wise to the database to flag any deaths we didn't know about. We've gone through the system and matched it against all other systems that use the SIN number. If we see that there's been no activity in five years, for example, if there's been no tax deduced, no premiums of any kind paid, no benefits claimed by that person, if that person just hasn't shown up in five years on any of these valid usages, we mark the SIN as dormant. Should that person ever show up for benefits, he or she would be called in and interrogated to make sure they proved their identity.
We're linking with Citizenship, as you've heard, to make sure our files are clean. We're matching the information on birthdays and so on from CRA files, so as you file your income tax we'll see if it's compatible with our registry.
We have brought the incidence down from five million to 700,000.
We've just hired an independent firm to go through and look at the quality of the data again and set standards of quality for different kinds of errors. Some errors are more important than others. Some errors are identity issues. Other errors may be a flip of the birth date--day, month, year; month, day, year.
As you've heard, up until 1976 you didn't have to prove anything to get a social insurance number. That's the history of it. It was just an account number. Decisions were taken back then--and the decisions are still valid--not to call these people in, not to bother these more senior people to start proving their identity all over again. But we look at it when they come to apply for benefits. We validate them again when they come for CPP; we still ask for documentation.
So we've cleaned up that methodology.
The really important thing we've done is implement a brand new state-of-the-art system that allows people to get a SIN number in 15 minutes. It puts them in front of an individual who's well trained on identity and documents. We link our files with all the provincial files so that when a person comes in with a birth certificate from Ontario, we not only know that this is how it should look--we put it under the scope of special equipment to make sure it's a valid document--but we also link in technologically with the province to see if it actually matches what the province has for this individual. And should it not match, we don't just say, you can't get a SIN; we go back to the province and we start an investigation. So we're helping the province to clean up as well.
I think we're pretty good. Our agents at the front desks in all our offices will have online access to that central index file to double check. When you're in front of us, they can double check the information you may have given us 30, 40, or 50 years ago to see if it all still matches the documents you're showing us.
So we're working on it, and it's really coming along. We hope the Auditor General will validate that.
I'd like to take this time to thank Mr. Nixon and his team for coming in to talk to us today and to hear the update. I'm sure we'll all be watching this next year when the Auditor General comes back to let us know about the progress.
Thank you once again for taking time out of your schedules to come and meet with us today.
Before we close, I want to say that before we met with the witnesses Mr. Martin had talked about passing the travel itinerary. I do want some clarification. Perhaps you would like to have a look at the dates in terms of where we're at, just before we close.
You have the dates in front of you. Perhaps you would like to turn to the page on the following cities and times.
As you can appreciate, we're in Ottawa from September 18 to October 6, when we return, so that doesn't take a whole lot to understand. We're going to be having the meetings in Ottawa.
In terms of eastern Canada, I have talked to our whip's office. He is obviously working with the opposition whips. He has no issue with our travelling on the 9th to the 12th, which is not a break week. I believe it's the week before the break week. There's not an issue there as long as agreements can reached with the opposition whips. There would probably be six of us--I would think three from the government, three from the opposition--as we move out to talk to people, as long as there's an agreement that this is not an issue, for travel. The 9th to the 12th is not an issue with our whip's office at this point in time.
I understand there may be some concerns with the break week of November 13 to 15. If it is the will of the committee, once again we will need to go back and talk to our respective whips' offices if we were to travel on a non-break week. Certainly, people are busy enough as it is on their own break weeks. Maybe we should be looking at trying to put that back to a time when it would be acceptable to all parties in terms of the ability to travel out west.
I throw that to the will of the committee in terms of where we're at.
Mr. Brown.