PACC Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Public Accounts

EVIDENCE

CONTENTS

Wednesday, April 9, 2003

¹

1530

The Chair (Mr. John Williams (St. Albert, Canadian Alliance))

Ms. Sheila Fraser (Auditor General of Canada, Office of the Auditor General of Canada)

¹

1535

¹

1540

The Chair

Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance)

Ms. Sheila Fraser

Ms. Val Meredith

Ms. Sheila Fraser

¹

1545

Ms. Val Meredith

Ms. Sheila Fraser

Ms. Val Meredith

Ms. Sheila Fraser

Ms. Val Meredith

Ms. Sheila Fraser

¹

1550

The Chair

Ms. Diane Bourgeois (Terrebonne—Blainville, BQ)

Ms. Sheila Fraser

Ms. Diane Bourgeois

Ms. Sheila Fraser

Ms. Diane Bourgeois

Ms. Sheila Fraser

Ms. Diane Bourgeois

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1555

Ms. Sheila Fraser

Ms. Diane Bourgeois

Ms. Sheila Fraser

Ms. Diane Bourgeois

Ms. Sheila Fraser

Ms. Diane Bourgeois

Ms. Sheila Fraser

º

1600

Ms. Diane Bourgeois

The Chair

Mr. Shawn Murphy (Hillsborough, Lib.)

Ms. Sheila Fraser

Mr. Shawn Murphy

Ms. Sheila Fraser

Mr. Shawn Murphy

Ms. Sheila Fraser

Mr. Shawn Murphy

Ms. Sheila Fraser

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1605

Mr. Shawn Murphy

Ms. Sheila Fraser

Mr. Shawn Murphy

Ms. Sheila Fraser

Mr. Shawn Murphy

Ms. Sheila Fraser

Mr. Shawn Murphy

Ms. Sheila Fraser

Mr. Hugh McRoberts (Assistant Auditor General, Office of the Auditor General of Canada)

Mr. Shawn Murphy

The Chair

Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP)

º

1610

Ms. Sheila Fraser

Ms. Maria Barrados (Assistant Auditor General, Office of the Auditor General of Canada)

Ms. Judy Wasylycia-Leis

Ms. Sheila Fraser

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1615

Ms. Maria Barrados

Ms. Judy Wasylycia-Leis

Ms. Sheila Fraser

The Chair

Mr. Gerald Keddy (South Shore, PC)

º

1620

Ms. Sheila Fraser

Mr. Hugh McRoberts

Mr. Gerald Keddy

Mr. Hugh McRoberts

The Chair

Mr. Hugh McRoberts

Mr. Gerald Keddy

Mr. Hugh McRoberts

Mr. Gerald Keddy

Mr. Hugh McRoberts

Mr. Gerald Keddy

Ms. Sheila Fraser

Mr. Gerald Keddy

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1625

Ms. Sheila Fraser

Mr. Gerald Keddy

Ms. Sheila Fraser

Mr. Gerald Keddy

The Chair

Mr. Gerald Keddy

The Chair

Mr. Gerald Keddy

Ms. Sheila Fraser

The Chair

Mr. Hugh McRoberts

The Chair

Mr. Hugh McRoberts

The Chair

Mr. Hugh McRoberts

The Chair

º

1630

Mr. Hugh McRoberts

The Chair

Ms. Sheila Fraser

The Chair

Ms. Sheila Fraser

The Chair

Ms. Sheila Fraser

The Chair

Ms. Sheila Fraser

The Chair

Ms. Sheila Fraser

The Chair

Ms. Sheila Fraser

The Chair

Ms. Sheila Fraser

The Chair

º

1635

Ms. Beth Phinney (Hamilton Mountain, Lib.)

The Chair

Ms. Beth Phinney

The Chair

Ms. Beth Phinney

The Chair

Ms. Beth Phinney

Ms. Sheila Fraser

Ms. Beth Phinney

Ms. Sheila Fraser

º

1640

The Chair

Mr. John Finlay (Oxford, Lib.)

Ms. Sheila Fraser

Mr. John Finlay

Ms. Sheila Fraser

Mr. John Finlay

The Chair

Ms. Val Meredith

º

1645

Ms. Sheila Fraser

Ms. Val Meredith

Ms. Sheila Fraser

The Chair

Mr. John Finlay

Ms. Sheila Fraser

Mr. John Finlay

The Chair

Mr. Gerald Keddy

Ms. Sheila Fraser

Mr. Gerald Keddy

Ms. Sheila Fraser

Mr. Gerald Keddy

The Chair

Ms. Sheila Fraser

Mr. Gerald Keddy

Ms. Sheila Fraser

Mr. Gerald Keddy

Ms. Sheila Fraser

The Chair

Ms. Judy Wasylycia-Leis

Ms. Sheila Fraser

The Chair

Ms. Sheila Fraser

The Chair

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1650

Mr. Vadim Fotinov (Interpreter, Delegation from Commission on Interaction with the Accounting Chamber, Russian Federation Council, As Individual)

The Chair

Mr. Vadim Fotinov

The Chair

Mr. Vadim Fotinov

The Chair

Mr. Boris Georgivich Preobrazhenskiy (First Deputy Chairman, Commission on Interaction with the Accounting Chamber, Russian Federation Council, As Individual)

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1655

The Chair

Ms. Sheila Fraser

The Chair

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CANADA

Standing Committee on Public Accounts

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NUMBER 025

l

2nd SESSION

l

37th PARLIAMENT

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EVIDENCE

Wednesday, April 9, 2003

[Recorded by Electronic Apparatus]

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[English]

    The Chair (Mr. John Williams (St. Albert, Canadian Alliance)): Good afternoon, ladies and gentlemen.

    The order of the day is, pursuant to Standing Order 108(3)(e), consideration of the April 2003 Report of the Auditor General of Canada.

    Our witnesses today are from the Office of Auditor General of Canada, Ms. Sheila Fraser, the Auditor General of Canada, Mr. Hugh McRoberts, Assistant Auditor General, Mr. Shahid Minto, Assistant Auditor General, and Ms. Maria Barrados, Assistant Auditor General. Of course, you are here on the report you tabled in the House of Commons yesterday, and you are now going to be presenting it to the public accounts committee.

    So without further ado, Ms. Fraser, I turn it over to you.

    Ms. Sheila Fraser (Auditor General of Canada, Office of the Auditor General of Canada): Thank you, Mr. Chair.

    We thank you for the opportunity to meet with the committee today to discuss our report, which, as you mentioned, was tabled yesterday.

    With risk and uncertainty so much a part of our current environment, I am acutely aware of the timeliness of this report and its theme of risk management in the federal government. The challenge of risk management is to strike the right balance between undesirable extremes. We don't want managers trying to avoid risk entirely, because that stifles innovation, but we also don't want them taking irresponsible chances that could jeopardize public safety or public assets.

    These days people are more aware of extraordinary risks such as terrorism or threats to our health, like SARS, but managing risk means more than preparing for the worst, it also means taking advantage of opportunities to improve services or lower costs. The federal government took a very positive step two years ago when it introduced its integrated risk management framework, but so far government departments are still in the early stages of implementing this framework.

[Translation]

    In Chapter 1, we looked at what six departments have done to date—and all six are missing crucial elements in their strategies to implement the framework. None of the departments we audited had a fully developed risk profile that set out their risk tolerances, that is the levels of risk they are prepared to accept.

    When the framework is fully in place, it will go a long way toward taking the guesswork out of managing risk. it will also foster a culture that encourages innovation, contributes to the efficient management of resources and improves decision-making in the public service, goals that all Canadians support.

    If the government wants to keep this initiative from stalling, senior managers of departments will need to demonstrate greater commitment and leadership. The Treasury Board Secretariat must also monitor this initiative more actively, provide more practical guidance and play a more energetic role of coordination across departments.

    Many of the most important risks the government has to manage stem from its role in assuring public security and protecting the environment. This report looks at how well federal departments have managed a variety of environmental, strategic, operational and financial risks.

[English]

    Chapter 5 looks at Citizenship and Immigration Canada's control and enforcement activities. Every year 100 million people present themselves at Canada's ports of entry. Determining who is a legitimate traveller and who should not be admitted to the country is an enormous challenge, but a vital one. A comprehensive risk assessment of Canada's ports of entry by Citizenship and Immigration would help identify the greatest risks, so that it could then focus more attention on them. However, the department has not done this, and several years have passed since the last time it assessed the effectiveness of its border controls.

    It is also the department's job to enforce the removal of people who should not remain in the country. However, our audit found that high workloads, insufficient resources, and inadequate information systems hinder CIC's ability to enforce removal orders. As a result, the gap between the number of removals that have been ordered and the number of departures that have been confirmed has grown by 36,000 in the past six years. Care should be taken when interpreting this figure. It does not necessarily mean all these people are still in Canada illegally. CIC cannot know how many are still here, because Canada does not have exit controls. Some may have left voluntarily without informing the department. The figure does indicate that the department is falling behind in its enforcement efforts. The growing backlog in removals undermines the system used to admit people to this country.

    On the positive side, the department has taken steps to prevent inadmissible travellers from entering the country in the first place. In the past three years its immigration control officers have worked with airlines overseas to stop some 20,000 people with fraudulent travel documents boarding flights to Canada. This is a good example of allocating resources according to risk. While I am encouraged by this initiative, Citizenship and Immigration still needs to determine how effective its controls are at ports of entry. After we completed our audit, the department signed a long overdue agreement with the Canada Customs and Revenue Agency, whose officers are the first point of contact for travellers coming into the country. This is an important step towards strengthening border controls.

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[Translation]

    Correctional Service Canada is a another department that must manage risks effectively to protect public safety.

    In Chapter 4, we note that the Service has done a great deal to improve how women offenders are incarcerated and rehabilitated, but our audit found two important gaps. Correctional Service needs to test the reliability of the tools it uses to assess offender security levels and their needs for rehabilitation programs.

    It also needs to provide women offenders with timely programs tailored to their particular needs while they are incarcerated. These programs help them to prepare for their release and to rebuild their lives, reducing crime and the social costs it entails.

    The Department of National Defence uses about 18,000 square kilometres of land to train Canadian soldiers and soldiers from other countries. If military training is to be realistic, it will have an impact on the environment. We understand that.

    When we looked at how the Department currently manages the environmental risks that its training activities entail, we concluded that it can and must do much more to manage the resulting environmental damage.

    To ensure that its training activities are environmentally sustainable, National Defence must develop mitigation and restoration plans, address how and when to use stressed or overused areas, and to identify which type of training to conduct in certain areas. Furthermore, it absolutely must abide by federal legislation that protects the environment.

    Risks cannot be managed well without good information.

    In Chapter 2, we found that managers still rely too much on their own informal records and still focus too narrowly on the short-term issue of how much cash they have left to spend in the current fiscal year. Instead, they should be using the new financial systems that the government has invested in, which provide a more complete picture. More guidance from the Treasury Board Secretariat is needed to ensure that high-quality financial information is prepared consistently throughout government. It has been two years since the government put in place the new financial systems for its Financial Information Strategy. It is now time to follow through with a concerted effort, led by the Treasury Board Secretariat and senior management, to begin reaping the benefits of this significant investment.

[English]

    There is also a need for better information, according to our analysis of federal support to first nations for on-reserve housing. Federal funding totalled about $3.8 billion over the last decade, yet many first nations are facing a housing crisis. Unless action is taken quickly, the already unacceptable housing conditions are only going to get worse, with population growth on reserves that is twice the Canadian average. Indian and Northern Affairs Canada, Canada Mortgage and Housing Corporation, and first nations have not agreed on their respective roles and responsibilities for addressing the housing shortage on reserves. Programs and funding mechanisms are complex. They need to be streamlined, with clear assignment of responsibility for results. The government also needs to clearly articulate to Parliament the expected results and costs of housing programs. At present Parliament does not receive complete information about the housing situation on reserves or the difference federal assistance is making.

    In addition to the above audits, this report includes a study on Canada's strategy to combat money laundering and terrorist financing. Not only must Canada's strategy enforce the law, it must also try to achieve other important objectives, such as protecting personal information, controlling costs, and supporting international efforts. This study sets the stage for a future audit of the federal government's strategy to combat money laundering. In November 2004 we will address the issue of how well those challenges are being managed. Striking a balance among multiple goals is a difficult challenge, and in 2004 members of Parliament will review the legislation that underpins the strategy to combat money laundering and terrorist financing.

    Mr. Chair, that concludes our opening statement. We thank you and look forward to hearings on these chapters. We would be pleased to answer any questions the committee might have.

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    The Chair: Thank you very much, Ms. Fraser.

    Before we begin, I would just say that I have called a steering committee meeting at 5 o'clock, so this meeting will wrap up at 5 o'clock.

    I've also become aware that we have a delegation from the Accounting Chamber of the Russian Federation in the room, so at 10 minutes to 5 I will ask them to come forward and perhaps say a few words.

    I should also mention that Mr. Mayfield, who, of course, has been the lead spokesman on behalf of the Alliance, has some health problems, so we expect that he will be not with us until the summer break.

    These are the announcements. Now we'll go into our normal round.

    Ms. Meredith, eight minutes.

    Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Thank you, Mr. Chair, and thank you, Madam Fraser and your colleagues, for again bringing to Parliament's attention some issues in the accounting and functions of government.

    The whole audit was based on risk management, and you made a couple of comments about various departments having programs in place for several years, but basically not using the programs, not following through, not making the most of them. Did you get the feeling in your audit process that this is because they haven't bought in to the new risk management processes, or is it just that they don't recognize the importance of them?

    Ms. Sheila Fraser: Many departments have risk management practices in place for specific programs or specific areas. The initiative we are addressing in this audit is a management program that integrates all those various practices in different programs, whereby the department assesses risk for the whole department. It is a relatively new initiative, two years old. It is, I would add, new not only in the federal government sector, but even in the private sector and other public institutions. So this is a relatively new concept organizations are bringing in, and I think, like any change in management practice, it takes a while to bring it into operation.

    We did note in the audit that there needs to be more senior involvement and commitment if this thing is to succeed, because the whole determination of risks and then how to deal with them really is something senior managers should take responsibility for.

    Ms. Val Meredith: But my question was, did you get the feeling in your audit that those senior managers, the people who are responsible for making these changes work, have bought into it, or are they still showing some reluctance to do the necessary planning, the necessary identification?

    Ms. Sheila Fraser: The implementation of the process is, at best, very slow. As we noted, of the six departments we audited only two had action plans, and even with those two, they weren't complete. We saw in many of the departments as well that the senior officials weren't sufficiently involved, and that is why we're encouraging more active monitoring by the Treasury Board Secretariat and a call to senior managers to become involved, to make sure it is a success.

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    Ms. Val Meredith: Again, I'm going to go back to my question. Is it that they don't see the need for it? Is it that they feel it's a waste of their time? Have the senior management in the six departments you've looked at bought into it? Do they accept that this is the way to move forward, that they'll have to give it their attention? Are they going to commit themselves to identifying the risks, what degree of risk they're going to be prepared to take, and how they're going to assess whether or not it's been successful?

    Ms. Sheila Fraser: Unfortunately, I can't answer your question with the kind of precision you would like, because we haven't done enough of a survey of managers to find out how they feel towards the strategy. We are just looking at where they are in the implementation. The motivation as to why they haven't progressed further we haven't got into.

    Ms. Val Meredith: That's what concerned me. Two years have gone by, and yet they're at the early stages of implementing it. Two years have gone by, and they haven't identified risk. It's not as if this is a six-month program. This program has been in front of them for two years, and yet there doesn't seem to be a buy-in. You mentioned in one of the chapters that the Treasury Board has to have a more hands-on approach, to do more training, to be more proactive. So is it really the Treasury Board that has to go back to all government departments and insist on a buy-in and do something progressive to get the departments moving on this?

    Ms. Sheila Fraser: I think it might be interesting for the committee to invite the Treasury Board and perhaps, if you think it appropriate, some departments to discuss why this hasn't progressed further. One thing I would say is that there are a lot of initiatives under way in government to change management and to change management practices, and one quick question is whether there aren't a lot of competing demands such that people may have some difficulty trying to move them all forward. But I think that's really a question that should be brought up with the Treasury Board Secretariat.

    Ms. Val Meredith: I looked specifically at some of the chapters, and the one on Citizenship and Immigration raises an issue that has been a concern of Canadians for a very long time. You've got a system now the government is putting in place to help them deal with this concern of Canadians, and yet there still seems to be a reluctance in taking hold of the help that's being provided to them to deal with this risk management they have to contend with. Again, I'm concerned that the management level in all these departments, whether it's Indian Affairs or Citizenship and Immigration, don't accept the advantage to them in getting into some kind of organized program identifying the risk and making educated decisions as to how much of that risk they're going to assume and how they're going to monitor whether or not the programs they put in place actually work. I'm confounded that they don't see this as a positive thing they should be supporting 100% to make their job easier.

    One of the chapters talks in general terms about managing the quality of financial information. I agree with your premise that you can't make a good decision if you don't have good quality information coming in. It's a sharing of information from department to department, so that you've got a communication vehicle across various departments. Is this because we don't have integrated information systems, but each department has its own collection of information, its own system? I'm thinking of the RCMP, CCRA, Citizenship and Immigration. There isn't an integrated system for collecting and receiving information. Do you see that as a direction we should be going in?

    Ms. Sheila Fraser: The audit we did here on the quality of information looked at information generally within the financial systems in departments. Those systems are not integrated. The government has actually spent a significant amount of money to put individual financial information systems within each department, so now they are very much specific to a department, they do not share information across government. They then download data into a central system to do the public accounts. Because it is relatively new, two years since the financial information strategy and these new systems were introduced, there is still great reluctance on the part of managers to start using the new systems. I think there are various reasons. A lot of it is on-line, so there may be some discomfort with using information on-line. There is probably a certain security in using information we know is reliable. There have been problems, noted in the audit, in not updating information quickly enough, for instance, the HR information. So I think there are a lot of management change issues that have to be dealt with.

    We didn't get into integrating. We were talking about integrating human resource management information and financial information within a department. In this particular audit we haven't talked about a cross-government system, but there has been a conscious decision to put accounting systems into each department one by one, not an integrated system across government.

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    The Chair: Thank you very much, Miss Meredith.

[Translation]

    You have eight minutes, Ms. Bourgeois.

    Ms. Diane Bourgeois (Terrebonne—Blainville, BQ): Thank you, Mr. Chairman.

    Good morning, Ms. Fraser. I've given most of your report a thorough read through. I was particularly interested in the living conditions of offenders housed in Correctional Service Canada facilities, as well as in their reintegration into society. My questions will therefore focus on these areas.

    First of all, where did you get the information on which the report is based? Did you actually visit institutions, or did you merely meet with Correctional Service officials?

    Ms. Sheila Fraser: Mr. Chairman, we indeed meet with officials at the head offices of the Correctional Service, but the team also toured a number of institutions. I personally visited the healing lodge in Saskatchewan last fall.

    Ms. Diane Bourgeois: Your report mentions a healing lodge for aboriginal women. Unfortunately, no data is provided, just the name of the lodge. You did not focus a great on this facility for aboriginal women. Are the living conditions of aboriginal women different from those of offenders in other Correctional Service facilities?

    Ms. Sheila Fraser: I thought we had talked about it. A healing centre was built in Saskatchewan for aboriginal women, although I don't believe it is restricted to aboriginal women, unless my team tells me otherwise. Many native practices and traditions are used to help women turn their lives around. I believe the lodge houses between 20 and 30 women. Residents gather in traditional circles. Some community elders also visit the lodge. The focus is on helping women through a traditional native approach.

    Ms. Diane Bourgeois: Do women living at this lodge have access to more services than women in other institutions?

    Ms. Sheila Fraser: The services are somewhat different, because the emphasis in on native traditions, on the elders and on aboriginal culture. However, generally speaking, the services are fairly similar to those available to women at other facilities.

    Ms. Diane Bourgeois: You state in the report that the costs of supervising women offenders in the community are not reported separately. You also note that Correctional Service has made attempts to collect that information, but has been hampered by the lack of gender-specific coding in its financial information system. Yet, $10 million has been allocated to Status of Women Canada for the purpose of conducting gender analyses. Is it possible Status of Women Canada has not done this gender analysis or that Correctional Service has not requested one?

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    Ms. Sheila Fraser: Mr. Chairman, the problem lies in the fact that when the Correctional Service records expenditures, it does not distinguish between services for male offenders, and those for women offenders. What's needed is gender-specific coding. For example, all community services are grouped under the same accounting code. That needs to change. I doubt CSC could do a more comprehensive analysis given that the basic accounting information is not gender-specific.

    Ms. Diane Bourgeois: If the risk management approach used is not based on a gender analysis, then clearly, no accounting method will be adequate in terms of recording expenditures. That goes without saying. Is there no initial reference to gender analysis? My question is important, since the Government of Canada has earmarked $10 million for gender analysis. Theoretically, this approach should be adopted by all departments. Have you not looked into this?

    Ms. Sheila Fraser: Unfortunately, I don't have that information. However, if ever a meeting is held to discuss the matter, yours would be a good question to put to departmental officials.

    Ms. Diane Bourgeois: Ms. Fraser, in 1990, the Task Force on Federally Sentenced Women issued Creating Choices. This report found that the needs of women offenders differed sharply from those of male offenders and that the correctional system must bear this in mind at the time of sentencing. Correctional Service Canada concurred with the report's recommendations in 1990.

    Justice Arbour more or less reached the same conclusions in 1996, namely that women offenders should have programs and services specifically designed for them and again, Correctional Service agreed.

    Today, in 2003, you are recommending the same thing. In 2002, the CSC ombudsman made the exact same recommendation.

    Do you suppose that one day, CSC will see to it that women offenders have acceptable living conditions and conditions conducive to social reintegration? What are your views on the subject, if I can ask?

    Ms. Sheila Fraser: That's a question that I think should be put to departmental officials. However, I must say that considerable progress has been made as a result of the closure of the Prison for Women in Kingston and the opening of regional facilities. In my view, this was a major step forward, representing a significant investment and considerable effort on the part of the CSC. The CSC concurs with our recommendations and acknowledges that it must do even more. It has started to set up programs specifically designed for women, but as our audit demonstrated, there is still considerable room for improvement.

    Ms. Diane Bourgeois: The report states that improved risk management instruments will lead to a drop in the crime rate and to lower social costs. Is the report implying the Correctional Service Canada does not know how to manage risk?

    Ms. Sheila Fraser: The instrument currently used must be further tested to ensure its validity and also, its dependability. Those using the instrument must be able to assess a given woman in the same manner. This assessment is critical because it determines the type of program that the offender must enrol in during and after her incarceration. For the sake of rehabilitation, it is very important for the basic instrument to be valid. There is still work to do on this score.

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    Ms. Diane Bourgeois: Thank you, Mr. Chairman.

[English]

    The Chair: Merci beaucoup, Madame Bourgeois.

    Mr. Murphy, eight minutes.

    Mr. Shawn Murphy (Hillsborough, Lib.): Thank you very much, Mr. Chairman.

    First, I've read the report on money laundering. Are there any statistics available on how much money is laundered in Canada, how much money is seized by the police? Were there ever any convictions under the act that was enacted several years ago?

    Ms. Sheila Fraser: I know there are no reliable estimates of the amount of money laundered in Canada. I presume we would be able to get information on convictions, if there are any. I'm told there haven't been any.

    Mr. Shawn Murphy: There are no convictions, no estimates. It's a very difficult subject to get into. There'd be no limit on the amount of money you could spend looking for money laundering activities. Of course, you're going to run up against the Charter of Rights, as they are with the lawyers' files right now.

    I've read your report, and I'm troubled. Is there anything specific the government should recommend?

    Ms. Sheila Fraser: This report, I should reiterate, is just a study. It's basically describing the legislation that's in place and some of the challenges the strategy has to consider. One of those, of course, is how you evaluate your results. We will be looking, when we go back to audit in 2004, at how the department and government measure their performance and what tools they use to evaluate performance. I think that's one of the challenges as well in this area, how you measure performance and how you measure progress.

    Mr. Shawn Murphy: This is my difficulty. If you have no knowledge of the amount of money that is laundered, if there are no convictions, it's a very difficult subject to get into. We could always recommend spending more money, but if you doubled it, I believe you could be back here in two years saying you still don't know, nothing has changed.

    Ms. Sheila Fraser: That will obviously be one of the questions we will be looking at, how they measure their performance.

    Mr. Shawn Murphy: I want to change the topic now, Ms. Fraser. On the immigration issue, I agree with you that the numbers are very startling, especially when you consider the people who follow the correct procedures to get into Canada. Again, we're up against policy. It seems to me the Government of Canada has adopted a policy of allowing every person who has a foot in Canada to have the benefit of the Charter of Rights and Freedoms. They don't detain that many. I know there are a hundred million visitors a year, there are a lot of people moving in and out of the country, and when you have these policy considerations, it shouldn't surprise anyone that we do have 36,000 missing immigrants over the last five years. Although I find the statistics alarming, and it would be great to correct it, personally, I think people should be detained automatically if they don't have accurate papers. If you have the policy there, I'm surprised the number is not greater.

    Ms. Sheila Fraser: We don't know what the real number is of illegal immigrants. The 36,000 is a comparison of two numbers, people against whom there has been a removal order, people who have exhausted all the appeal processes and have been ordered to leave the country, and the number of confirmed departures. The number of people illegally in the country I think we can all assume is greater than that. What really concerned us in that chapter was to see the trend going up. Realistically, we know that number can never go to zero, and with risk management, you maybe wouldn't want it to go to zero. But the trend line is going up.

    We looked at three large offices, and there's a backlog of 11,000 investigations. When you look at the Immigration and Refugee Board, where you have some 50,000 cases, there's a huge backlog in the system, and the department has to put more effort into the control and enforcement activities, and it needs much better information. They don't have adequate information systems to give them a portrait nationally of what is happening. I think they have agreed with us that action needs to be taken on this.

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    Mr. Shawn Murphy: This would require a lot more funding, I assume.

    Ms. Sheila Fraser: It would likely involve more funding for that activity. Would it require more funding within the department? I can't answer that, but I think more priority has to be given to control and enforcement activities.

    Mr. Shawn Murphy: I know they have a real problem in the United States also, Great Britain, France. From the best practices point of view internationally, how do we rank?

    Ms. Sheila Fraser: I've heard reports that the U.S. has some 300,000 illegal immigrants. I don't know how valid those numbers are or what they would be in any other countries. The issue, of course, is that the department itself should set targets for what they think are reasonable numbers. Do they prioritize the cases, so that the people who we really don't want in the country aren't here? Do they know what those cases are? That is one of the issues we're raising. Nationally, they don't have that information.

    Mr. Shawn Murphy: To change the topic again, we're to deal with the report on women in federal institutions. Has there been any international comparison as to best practices here?

    Ms. Sheila Fraser: We have not done any per se. Correctional Services, I think, have looked at systems elsewhere, but we did not do that in our audit.

    Mr. Shawn Murphy: According to my very rough estimate, it's costing the taxpayers anywhere between $70,000 and $75,000 a year to keep a female inmate incarcerated. Does that compare to male inmates? Is there an international comparison? Is there any comment from the Auditor General's office on that?

    Ms. Sheila Fraser: I think we did have some information on the report concerning the costs.

    Mr. Hugh McRoberts (Assistant Auditor General, Office of the Auditor General of Canada): We have some overall cost information, but we didn't do a comparison of male versus female costs, partly because some of the stuff isn't coded on a gender-specific basis, which we've already discussed. As well, there's the way in which you break out the capital costs, very simply because of the relatively small number of female offenders. The decision to place those female offenders in regional institutions means many of the economies of scale that are available for capital and overheads in taking care of male offenders are simply not available to the same degree in taking care of female offenders.

    Mr. Shawn Murphy: Thank you very much.

    The Chair: Thank you very much, Mr. Murphy.

    Ms. Wasylycia-Leis, eight minutes.

    Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Thank you, Mr. Chairperson.

    I'd also like to thank Ms. Fraser and all the members of the Auditor General's staff for being here today and for the excellent seven chapters you released yesterday.

    I'd like to focus on the one I think is the most important in respect of public policy, the one on housing in first nations communities. I think your report is very important in exposing what we think to be the case, but it has certainly helped understanding of what many would consider to be Canada's shame. The fact that we have first nations people living in third world conditions has been talked about, but you've helped to document it and shed some light on the depth of the problem. When we raised issues from some of the material in your report yesterday in the House and again today, we got some puzzling answers from the minister, and I just wanted to ask about a couple of those answers.

    On the one hand, he is suggesting that the government has actually done a great service in the area of first nations housing and increased the budget significantly. Mr. Nault used the figure of a 70% increase in reserve units since 1991. That seems to fly in the face of the data you presented us with yesterday. Could you give us some understanding of what he means by the 70% and what we're really talking about? I'm looking at paragraph 19, and then 92, where you actually talk about a straight line of base funding and an actual decline in housing units since 1996. What are the real facts here?

º  (1610)  

    Ms. Sheila Fraser: I will start, and then I'll ask Ms. Barrados to supplement it.

    As we note in the report, the base funding for housing has remained stable since the early nineties, I believe. The absolute amount of money has not increased, so the number of houses being built is decreasing, because of costs going up and the stable funding. I think there have been additional funds given year by year, and perhaps Ms. Barrados can elaborate on that.

    Ms. Maria Barrados (Assistant Auditor General, Office of the Auditor General of Canada): I'll try.

    The core funding, as the Auditor General has said, has stayed the same, but that means there has been money going into this every year. So when you see an increase in the number of houses over a ten-year period, this is the result of money flowing in every year. It's the base you're using in saying how much growth there has been. From 1996 what we're seeing is that the rate is declining. So our concern is the ability to meet the requirements with a population growing and the decline in the number of houses actually being built.

    In addition to core funding, there are other kinds of funding, and that has fluctuated. You've got emergency funding, which we talk about in the chapter; we were concerned with how that was allocated. There was also the additional amount of money that was given when the new policy was announced, and that was greater than they had originally intended. But that was funding that was spent over the five-year period, and as a community signed on, they were given a one-time contribution.

    Ms. Judy Wasylycia-Leis: I appreciate the clarification. So what's really important for us to remember is that on a year-to-year basis, there's a shortfall in houses based on population, and that means families going without housing and having to bunk in with other families or live in temporary situations, and there's such a huge problem with decrepit housing and renovations.

    The other thing the minister said that came as a surprise to me and others is basically that the government has offloaded responsibility to first nations communities for housing. The minister, in fact, said, “If the member is suggesting it is the responsibility of the Government of Canada to produce a house for every single first nation family, I do not think so. Our role is to deliver policies that allow first nations to have their own housing based on their own abilities.” He also said in another answer, to Mr. Williams, that the amount of $137 million a year is transferred to first nations that have the responsibility for housing. That struck me as a shift in government policy, and I'm wondering if you can give us any insight. Has there been a formal internal policy decision or a legislative change that has allowed the government to say it's just a matter of giving money to first nations communities to do whatever they want with the housing, no matter what standards and no matter what capacity they have, so there's no more obligation on the part of either Indian and Northern Affairs or CMHC to monitor, work with them, apply standards, ensure funding is adequate, and so on?

    Ms. Sheila Fraser: In our report we note that in the 1996 policy one of the objectives of the government was to introduce more flexibility. It was to improve program flexibility, as mentioned in 6.26, and encourage more use of non-government resources. But we also note in the audit that there's not a clear statement of expected results for the funding that is being put in, and we note that there should be a much clearer statement of the roles and responsibilities of various parties involved, DIAND, CMHC, and first nations.

    I don't know, Maria, if you want to add anything more to that.

º  (1615)  

    Ms. Maria Barrados: The dollar amount you're referring to, the $137 million, is that core funding. That's the base funding that has been there, and there's other funding that has come in.

    The big issue with responsibility is something that really does have to be worked out, because there is a lack of clarity as to who is to do what, and some of this is on the part of the first nations. There are some first nations who feel that they should be contributing some of their resources to housing, and we carry an example in the report, there are others who do not, who feel it's an entitlement and a right, and there's a debate about that. There's also lack of clarity as between what DIAND does and what CMHC does. So there's a lot that needs to be worked out here.

    Ms. Judy Wasylycia-Leis: It would seem, Mr. Chair, this would be an important area for us to explore as a committee and to call witnesses on from the government, so we can get a better understanding of who's doing what.

    You touch in your report on the fact that poor housing means poor health, and there was a very recent Health Canada report that said exactly that, pointing to the spread of tuberculosis in overcrowded conditions, severe health problems and diseases associated with lack of running water in homes and inadequate sewage systems, sometimes 20 times higher than the national average. These are all related to housing, and that doesn't even include the things you've mentioned in your report, like mould contamination. Given the urgency, what do you think would be the most important initiative government could undertake at this point?

    Ms. Sheila Fraser: I think clarification of roles and responsibilities and goals, what results are expected to be achieved and over what period of time, more clarity about what the federal government is trying to do with the funds it is putting into this program.

    The Chair: Thank you very much, Miss Wasylycia-Leis.

    Mr. Keddy eight minutes.

    Mr. Gerald Keddy (South Shore, PC): Thank you Mr. Chair, and welcome to our visiting delegation from Russia.

    It's always interesting when the Auditor General has an opportunity to come to this committee. Several issues have been asked about already that I'd like to flush out a bit more. With respect to my colleague Ms. Wasylycia-Leis, although every chapter is important, I'm not sure it's the job of this committee to look at the impact on aboriginal housing, but it may be the decision of the committee.

    The first thing I'd like to touch on is your statement that between February 1995 and May 1997 there were over 50 contracts to clear timber at Camp Gagetown. The supposed reason for this was to increase their manoeuvre areas. Somehow or other, bartering was used--which I would like a little more explanation on, but I'll finish my question--under the Treasury Board's non-monetary guidelines. I'd like a clear explanation of that. The value of the contracts is where I'm headed, because it was $4 million, yet Canadian Forestry Services said the value of the timber was, I believe, $6.7 million. That's almost double. There's a huge discrepancy there that somehow or another slipped through the cracks. So I guess there are a few things we need to know. Who got the contracts? How was the bartering system used? I've worked in the forest industry all my life, and I've seen very few contracts that didn't cut off 10% to 20% more timber than was estimated to be on the piece of property, and most foresters would agree with that. So I'm quite shocked that you can have that large a discrepancy. Maybe we could get an answer on that issue first.

º  (1620)  

    Ms. Sheila Fraser: I'll ask Mr. McRoberts to respond to that question.

    Mr. Hugh McRoberts: With the process of bartering, essentially, you clear the land, you keep the timber.

    Mr. Gerald Keddy: Not a bad deal, if it's good timber.

    Mr. Hugh McRoberts: It's an acceptable practice. However, what is supposed to happen--

    The Chair: You said that was an acceptable practice?

    Mr. Hugh McRoberts: It can be an acceptable practice. However, you are supposed to first determine the value of the timber and only allow the contractor to keep timber that is approximately equal in value to the value of the work being done. That, of course, is precisely what did not happen in this case. The contracts were let without consulting the Forestry Service and, it would appear, with little idea on the part of those landing the contracts of what the value of the material they were, in a sense, bartering away was.

    Mr. Gerald Keddy: So there's an additional $2.7 million worth of timber that should have had stumpage paid on it, because that was over and above the barter.

    Mr. Hugh McRoberts: Presumably, yes.

    Mr. Gerald Keddy: It would be expected.

    Do we know who these contracts went to?

    Mr. Hugh McRoberts: We do not. That would be a good question to ask the department. We really weren't looking into the individual contracts, we were looking at the overall situation.

    Mr. Gerald Keddy: I appreciate that.

    Part of the audit is on the environment, and we have the lead weights and batteries deposited in Nanoose Bay, but I want to back up to this same contract in Gagetown and a similar one in Aldershot, where there were clear violations with the Department of Fisheries and Oceans. In the particular one in Gagetown in the salmon streams, which are highly protected and highly policed fresh water streams, there's an obvious abrogation of the rules. They simply looked the other way. I'm wondering if you're aware that in the Yukon, under the Yukon Placer Mining Act, they have completely shut down the industry, 280-some family businesses that have been in the placer mining business forever, because of fresh water rules from DFO. If there's anything we should learn from the Auditor General's report it is that there should be an even-handed approach and a clear application of the rules. Whether or not it's a government department involved is immaterial to that. I just wonder if you were aware of the Yukon situation.

    Ms. Sheila Fraser: No, I wasn't aware of the Yukon situation, but we agree with you, Mr. Keddy. We would expect government departments to respect laws that are applicable to everyone else. I think one question the committee may want to pursue, if ever there's a hearing, is that Fisheries and Oceans Canada seems to have taken a very much more collaborative approach to dealing with the department. We don't know why that is the case.

    Mr. Gerald Keddy: I want to ask a couple of questions on some other chapters.

    To go back to Ms. Wasylycia-Leis' line of questioning, when you were looking at first nations housing, did you also check into the flagrant issue that many first nations aren't registered? For instance, they're not registered on the voters list. One reserve may say there are 60 inhabitants, when actually there are 70, 80, or 90 inhabitants. We had this discussion the other evening. Because we may have an under-reporting of actual population, it may be 20% worse than we actually realize it is. So as bad as it is now, it actually could be worse. Were you aware of that?

º  (1625)  

    Ms. Sheila Fraser: No. We used plans and identification of housing needs that were prepared by the first nations themselves. They've been asked to identify shortages, needs, and all the rest of it, so we would have used those documents, rather than a basis of population, in doing this work.

    Mr. Gerald Keddy: So you should have pretty good data.

    Ms. Sheila Fraser: I would hope so.

    Mr. Gerald Keddy: Thank you.

    With Mr. Murphy's question on money laundering, I certainly understand that it's a very difficult process to prevent. I thought the whole point of attempting to prevent was to actually put an end to this practice. I don't think you can put a cash deposit in any bank in the country today over $10,000 without some paperwork as to where the dollars came from.

    The Chair: We wouldn't know, Mr. Keddy.

    Mr. Gerald Keddy: Well, obviously you don't deal in cash. Many people still do, many industries still do.

    It would seem to me that we've made a recognition of the fact that we must take the step behind money laundering, to organized crime and the places where they actually get their money to attempt to launder. So should we be looking more at combatting organized crime? I immediately think about the biker gangs in Quebec. The provincial police in Quebec had a very successful attempt at putting those biker gangs out of business with the Wolverines. They lost funding for that.

    The Chair: Do you have a question here, Mr. Keddy? You're over nine minutes already. I'll cut you off.

    Mr. Gerald Keddy: Sorry, Mr. Chair.

    Have we looked at the successes?

    Ms. Sheila Fraser: As I mentioned earlier, this really is a study, so it sets out the issue and what has been done so far and establishes the criteria we will use to audit. One of those will, of course, be a question on how the government evaluates the effectiveness of this. It is important to remember that this was all part of an international initiative, and it was very important that Canada be a partner in that initiative. There was legislation very early in the process, and just recently Canada created FINTRAC to trace information. The mandatory reporting is also fairly recent, and that was because Canada had to conform to international standards.

    As to whether the money should be going into this initiative or into other security initiatives, that is really a question of policy and one on which I can't comment.

    The Chair: With the timber situation down there at Gagetown, I noticed, Mr. McRoberts, that you gave a somewhat tentative approval of the process, because it seems to be approved by the Treasury Board policy and accounted for in non-monetary transactions. Does the Treasury Board policy envisage transactions of millions of dollars?

    Mr. Hugh McRoberts: I can't answer that right now, Mr. Chairman, I'm sorry.

    The Chair: Since it's a barter, you cut the timber and you keep what you cut. How did they arrive at a value of $4 million for the contract and $6.7 million for the trees? I presume it was just supposed to be a swap, work for trees.

    Mr. Hugh McRoberts: The value of the contracts was established by the department. The value of the trees, as we indicate in the chapter, was established by the Canadian Forestry Service after the fact.

    The Chair: Oh, after the fact.

    Mr. Hugh McRoberts: Yes.

    The Chair: They said the trees were worth $6.7 million after the fact. What was the $4 million? You said the contract was $4 million.

º  (1630)  

    Mr. Hugh McRoberts: We didn't go into the details of how that number had been arrived at.

    The Chair: They seem to have cut trees wherever they wanted to cut trees, and I presume they took the best of trees and left the scrub trees, because they cut in areas where they were not supposed to and left the ones they weren't supposed to cut. It seems kind of rough that we rely on these people to defend the country and they can't even defend the trees on their own particular patch of training ground.

    Ms. Sheila Fraser: That is a question for the department, Mr. Chair.

    The Chair: Certainly.

    On the immigration situation, you pointed out serious deficiencies: 36,000 people who should be out of the country are likely still in the country. A study in 1992 showed serious failings on the part of the department, and yet nothing really has been done so far. It will soon be two years since we had the wake-up call with September 11. Wouldn't you think the department would have realized its need to ensure that Canadians are well protected and should have acted before now on a 10-year-old study?

    Ms. Sheila Fraser: Mr. Chair, as you have indicated, one of the issues we've raised is that there hasn't been a study of the effectiveness of the inspection lines at ports of entry by either Immigration or Canada Customs. The most recent studies we found date to the early 1990s, and the results of those studies were not very good. In fact, there was a recommendation then that there should be periodic evaluations, for which we have seen no evidence. Two departments have recently signed a memorandum of understanding on rules and responsibilities, which has been a long-standing issue. That was signed in early March. In that agreement, we understand, there are provisions for evaluations and performance standards, and I hope the department and agency will conduct an evaluation shortly. That might be something to ask them, when they're going to do that.

    The Chair: Did you do a study on the number of people who arrive at ports that do not have an immigration officer on staff and are given an appointment to show up somewhere else where there is an immigration officer, how many actually keep that appointment and how many don't?

    Ms. Sheila Fraser: No, we did not look at that in this audit.

    The Chair: Do you feel that's a concern?

    Ms. Sheila Fraser: Again, I can't answer that, because we don't have the information, and I don't know if the department has the information either, to assess if that system is working or not.

    The Chair: Two or three years ago we looked at one of your reports dealing with the refugee process. It was brought to our attention at that time that approximately 20,000 people get off the plane or the ship or whatever with no documentation whatsoever, yet we all know you can't get on a plane without documentation. You point out in this report that through the immigration officers screening people getting onto the plane, they were able to identify, over a three-year period, approximately 20,000 people who had no documents, false documents, fraudulent documents, or documents that didn't meet the requirements and were denied access to the plane. I was actually astounded to find in your report that with 15% of the people who have no documentation, Canada Customs can't even identify which plane they arrived on, perhaps less than an hour before. So if you can't identify which plane they arrived on, how on earth are we able to determine if they're a security risk and what should be done with them?

    Ms. Sheila Fraser: You're right, Mr. Chair. In the report we mention that there is a difficulty in the larger airports identifying on which airline some of these people arrive, because there is a provision that the airlines can be charged for their removal costs.

    As to how they identify security, I think that is something that should be taken up with Customs or Immigration.

    The Chair: Do Air Canada have to pay a fee if they bring people to this country who shouldn't have been brought here?

    Ms. Sheila Fraser: There is provision that they can be charged for the removal.

    The Chair: I know there's a provision, but you say it's from zero to $3,400 per person, according to a carrier's record. My question was, do you know if Air Canada are paying, or are they exempted? What's their rating?

    Ms. Sheila Fraser: They get billed and they pay.

    The Chair: I can appreciate some members' concerns about ensuring that genuine refugees do come to this country and that they are able, if they can get to this country, to be treated appropriately. I fully agree with that. At the same time, I think the system can be and has been abused, and in this day and age we have a concern about that, because we now realize that it's not just good people who travel the world.

    Yes, Madam Phinney.

º  (1635)  

    Ms. Beth Phinney (Hamilton Mountain, Lib.): Mr. Chair, could I ask that at least each member of the committee gets their questions in before the chair asks his questions? You've had I don't know how many questions now.

    The Chair: Okay. I'm just coming up to my eight minutes.

    Ms. Beth Phinney: But you don't get eight minutes, that's the joy of being a chair.

    The Chair: I just realized that you and Mr. Finlay are down for questions as well, so--

    Ms. Beth Phinney: I wasn't meaning any individuals, I just meant in general.

    The Chair: I normally do come last, and perhaps I did jump ahead of the queue there. So why don't I just move on to you, Ms. Phinney, because you are next on the list?

    Ms. Beth Phinney: Thank you, Mr. Chairman.

    Thank you for being here today and for your good reports, as usual. I'm not going to ask you any questions, because I prefer to ask them when the department people are here to counter the answers you give and to give their opinions, but I have a general question I've often wondered about.

    We often say, the Treasury Board should look after this, the Treasury Board should look after that. I'm just wondering if you people, or others, ever check a department as a whole to see if they are able to do the work they're asked to do? I don't mean to decide on the programming or the political part of it. In this case I'm talking about the Treasury Board, because you've said in here the Treasury Board has to be more actively involved in the senior management of government departments for risk management and has to give more guidance to ensure high quality financial information. It's always the Treasury Board that should be checking this and checking that. Do they have the capacity? Do they have enough money and enough staff to do all these things? Do you ever look at the whole department and say, they can't do this job.

    Ms. Sheila Fraser: It's interesting that you ask that question. We will have an audit on the role of the Treasury Board, which we'll be reporting next year. I think it's important to recall that the Treasury Board Secretariat sees itself as the management board of government, and that is why it is responsible for many of the policies and much of the direction of management in government. That is why many of our recommendations go back to them, to make sure the policies and guidelines they have introduced are in fact being respected. I would agree with you that they have a lot of initiatives under way currently. We do not have a mandate to evaluate effectiveness. We would look to them to see how they are doing it.

    As a personal comment, I think they probably are under-resourced, because they do have an enormous number of initiatives on the go. I think it is a good question to be asked whether they do have enough resources.

    Our budget, of course, has to go through the Minister of Finance, but budgets of all departments, including that of the Auditor General, have to go through Treasury Board Secretariat. So it's not money that's coming from their budget, but they have a veto. We have to negotiate our budgets with them. That is one of the issues we raised here in committee. We think that is not the best system and could put the department and us in a situation of conflict of interest, which could undermine the independence of the office.

    Ms. Beth Phinney: I don't think it's just the Treasury Board either, as many departments complain that they don't have the people and resources to fix whatever it is or to do it properly. It seems that a lot of the departments need more money.

    Ms. Sheila Fraser: I think there are some areas where more resources are probably needed. I think there are, though, initiatives that can be carried on without a lot of money. With a little better management and perhaps a little more attention to certain issues, there can be reallocation of funds within departments, and that's what the managers are there to do.

º  (1640)  

    The Chair: Thank you.

    Mr. Finlay.

    Mr. John Finlay (Oxford, Lib.): Thank you, Mr. Chairman.

    Welcome. It's been a very interesting afternoon. I'll try to be rather brief. Ms. Phinney sort of started the ball rolling.

    I think you strike the right balance when you say you don't want managers trying to avoid risk entirely, because that stifles innovation. I completely agree. If you look over your shoulder every time before you dot an i or cross a t or spend $50, you're going to be in real trouble. I think that's what tends to happen when we have bad reports, the famous boondoggles of some years. Yet we don't want them taking chances to jeopardize public assets.

    Risk management, it seems to me, is a very good idea. I'd just like you to expand a little bit on what it is that doesn't seem to be getting through to departments. An integrated risk management framework has been developed, which means there will be certain objectives, certain tests, and so on. I may be wrong, but I thought you said that of six departments you had done two stood out either as having done a pretty good job or not--I can't remember what you said--but none of them had set out the level of risk they're prepared to accept. It seems to me that's pretty basic to management.

    Ms. Sheila Fraser: Yes, only two departments out of the six had action plans; even those ones weren't complete, but at least they had started to do the work they should be doing.

    One of the big issues, as you say, is defining the risk tolerance and how you manage to that. That is, I think, crucial. I think the environment in which departments work sometimes doesn't make it easy for them to do that, but it is critical that it be done and that the Canadian public be informed and be involved in some of the discussions. When we talk, for instance, about food safety, we talk about how there should be more discussion with the Canadian public about the tolerances for risk. So that's a very important step in this whole discussion of risk management.

    Mr. John Finlay: Thank you.

    Other people have raised this issue about immigration control officers and how 20,000 people with fraudulent travel documents have been prevented from boarding flights to Canada. This a good example of allocating resources according to risk. Do you mean improper documentation on airlines is where we get the greatest pressure?

    Ms. Sheila Fraser: What we were trying to say is that this is a positive step, to stop the people before they actually arrive in Canada. Once they get into Canada, they are covered by the charter provisions, and it becomes a very difficult and expensive process to get them out. So it is good if you can stop them before they actually board the plane to come here. This is an new initiative and one we think has been very positive.

    Mr. John Finlay: Thank you very much.

    Thank you, Mr. Chairman.

    The Chair: Thank you very much, Mr. Finlay.

    Ms. Meredith has indicated that she has a point of clarification. I would like to bring our Russian guests forward, but if anybody has something they would like to ask, we'll just ask these questions, and then we'll invite the guests to come forward.

    Ms. Val Meredith: Ms. Fraser, with these 36,000 people, you've made it the gap between removal orders issued and confirmed removals. Is this the number of people who come as refugee claimants and are given an appointment down the road, without having gone through a process?

º  (1645)  

    Ms. Sheila Fraser: We excluded from those numbers people who were in the process of a refugee claim. So these are people who have completed that process and have been ordered to leave the country.

    Ms. Val Meredith: So it doesn't properly reflect the number of people who have come to our border, claimed refugee status, and are somewhere out there we don't know of?

    Ms. Sheila Fraser: If they have not completed the process, they would not be included in these numbers.

    The Chair: Mr. Finlay, do you have a question?

    Mr. John Finlay: You say “managers still rely too much on their own informal records” and the cash they have left. They want to spend it before the end of the year--by March can you find a use for this kind of money, because it's still in the budget and I'm not going to give it back? “Instead, they should be using the new financial systems that the government has invested in...”. Is part of that the accrual accounting system we're trying to get people to use?

    Ms. Sheila Fraser: Yes, very much. The government has invested some $600 million in new systems, and we're saying, while it's important for people to track their appropriations and the use of those funds, they should also be tracking the costs of programs and other indicators of financial information.

    Mr. John Finlay: Thank you.

    The Chair: Mr. Keddy, you have a point of clarification?

    Mr. Gerald Keddy: On the 36,000 individuals who are here illegally, do we know how many of those files are actually ministerial files?

    Ms. Sheila Fraser: If a ministerial permit has been given, the removal order would no longer be in effect.

    Mr. Gerald Keddy: No, how many of those does the minister have a file on? There's a discrepancy in the number of files. There are 36,000 people here illegally. All of them don't have a file. There are no accurate numbers. These files, do they belong to the minister's office? Do we know?

    Ms. Sheila Fraser: I'm not sure. The 36,000 is just a comparison between removal orders that have been issued--

    Mr. Gerald Keddy: But does the minister have a file on each of those individuals?

    The Chair: Removal orders issued equal how many?

    Ms. Sheila Fraser: Roughly 14,000 a year, and then there are 8,000 confirmed departures. So we're saying there's a difference of 6,000 per year. That has now increased to 36,000.

    Mr. Gerald Keddy: So we should have a file on each individual with the minister or the department.

    Ms. Sheila Fraser: In the department, certainly. The minister wouldn't have all these files, I presume.

    Mr. Gerald Keddy: I understand that. I meant the department.

    Ms. Sheila Fraser: What we looked at as well was the number of cases where there has been an immigration warrant issued through the police system. There are 30,000 files there. So again there is a difference in the numbers, which goes back to my point about the information systems not being adequate.

    The Chair: Ms. Wasylycia-Leis, a brief clarification question.

    Ms. Judy Wasylycia-Leis: On the environment and the question of ammunition being fired, I was struck by the piece you did on Shilo, because it hits close to home. Does the Department of Defence now require foreign militaries who want to train in Canada and fire live ammunition to disclose what the make-up of the ammunition is before approval is given?

    Ms. Sheila Fraser: I'm afraid I don't have the answer to that.

    The Chair: I don't think that was a point of clarification.

    Ms. Sheila Fraser: We can perhaps provide that information to the committee.

    The Chair: Okay, ladies and gentlemen, I'm going to bring this part of the meeting to a close and invite members from the Accounting Chamber from Russia to come forward. Ms. Fraser, you can maybe stay, because these are your counterparts, after all.

    Let me first of all introduce Vadim Fotinov, the interpreter with the delegation. Vadim, would you like to introduce our guests?

º  (1650)  

    Mr. Vadim Fotinov (Interpreter, Delegation from Commission on Interaction with the Accounting Chamber, Russian Federation Council, As Individual): The delegation from the Federation Council are the deputy chair of the Commission on Interaction with the Accounting Chamber of the Russian Federation, which is the counterpart of the Office of the Auditor General, Mr. Preobrazhenskiy, and Mr. Malyshev, deputy chief of staff.

    The Chair: If I recall, there are 12 auditors in the Accounting Chamber who make up the committee of auditors general, much more like the European system, where they have a court of auditors, unlike our Canadian system, where we have only one Auditor General.

    Mr. Vadim Fotinov: For further clarification, they are not from the Accounting Chamber, but from the Federation Council Commission on Interaction with the Accounting Chamber.

    The Chair: Okay, my apologies.

    Today we have had a briefing from our Auditor General on a report she tabled yesterday. The committee has been quite informal and friendly today. Normally, the Auditor General sits there with a department trying to defend itself right beside her. She presents the evidence that's included in her report, and the department responds to the problems that have been identified in the report. So sometimes the discussion gets a little more animated.

    We have government members on this side. There are four parties in opposition, and they are represented on this side. The Public Accounts Committee is the only committee in the House of Commons that has an opposition member as the chair. I represent the second largest party in the House.

    If you have any questions you would like to ask, we'll be glad to hear them.

    Mr. Vadim Fotinov: Mr. Preobrazhenskiy would like to say a few words.

    The Chair: Please.

    Mr. Boris Georgivich Preobrazhenskiy (First Deputy Chairman, Commission on Interaction with the Accounting Chamber, Russian Federation Council, As Individual): Mr. Chair, ladies and gentlemen, I would like to express, on behalf of our delegation, gratitude for this opportunity to attend this very important session of the committee, because it is really a milestone event in your work when the Auditor General comes to present the annual report, particularly within the context of value-for-money auditing and effective spending of public funds. We believe coming here to Canada to find out more about Canadian best practices in Parliamentary control of value-for-money auditing will not only help to develop the parliamentary oversight function of the Federal Assembly of the Russian Federation, but will also improve value-for-money auditing practices in Russia. We think the Canada-Russia parliamentary program is a very important instrument, and we hope it will be continued.

    Thank you very much.

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    The Chair: On behalf of the committee, I welcome you to the Parliament of Canada. We do hope the exchange of information and ideas between your Parliament and ours is beneficial to us both. Value for money and good accounting practices are very much in the forefront of the work of this committee and the work of the Auditor General.

    One of the reports she tabled yesterday deals with a base issue regarding money laundering, which is one of the great scourges of the world. We, as parliamentarians, are concerned about ensuring that not only do we provide value for money to our taxpayers and to our citizens, but we also can play a role on the international stage in leading on issues such as trying to control money laundering.

    I know you have a hectic schedule during your visit to Canada, but we wish you well. We hope you can take back many good ideas from Ottawa and from Canada.

    Do you wish to say any words at all, Ms. Fraser?

    Ms. Sheila Fraser: Thank you, Mr. Chair.

    We have had several opportunities to work with the Russian Chamber. They have visited several times and are adopting much of our methodology. In fact, the Deputy Auditor General will be coming in May to visit us again, and I'm hoping to go to Moscow in the fall. We have a very good relationship with the Russian Court of Accounts.

    The Chair: Thank you once again. We're glad not only that you have come here, but that you brought the spring weather with you.

    The meeting is adjourned.