PACC Committee Report

Pursuant to Standing Order 108(3)(e), the Standing Committee on Public Accounts has the honour to present its

TWENTY-FOURTH REPORT

The Standing Committee on Public Accounts has considered Chapter 10 of the December 2002 Report of the Auditor General of Canada (Department of Justice — Costs of Implementing the Canadian Firearms Program) and has agreed to report the following:

INTRODUCTION

Few subjects in recent memory have produced as much controversy and debate in Canada as gun control.

In 1995, the Parliament of Canada passed the Firearms Act (the Act) and associated amendments to the Criminal Code. The Act established the Canadian Firearms Program (the Program) under the principal responsibility of the Department of Justice (the Department). The Program is intended to control acquisition, possession, and ownership of firearms, regulate the availability of certain types of firearms, and to deter the misuse of firearms. The Act and associated amendments provide for:

·       licensing all firearms owners;

·       registering and tracking all firearms and transfers of firearms;

·       controlling the import and export of firearms;

·       strengthening the offence and sentencing provisions of the Criminal Code, including mandatory minimum sentences for certain firearms offences; and

·       prohibiting additional specific firearms.

In 1995, the Department informed Parliament that the Program would cost $119 million to implement. It indicated that revenues of $117 million from fees would reduce the cost to approximately $2 million. By 2000, the Department estimated that by 2004-05 it would spend at least $1 billion on the Program and collect $140 million in fees after refunds.

Due to the importance attached by all Canadians to the safe and lawful use of firearms, and the costs associated with the Canadian Firearms Program, the Committee decided to examine the results of an audit conducted by the Auditor General of Canada that focused on the expenditures and revenues of the Program. Accordingly, the Committee met on 24 February 2003 with the Hon. Martin Cauchon, the Minister of Justice, and Sheila Fraser, the Auditor General of Canada. Mr. Morris Rosenberg, Deputy Minister of Justice and Deputy Attorney General of Canada, and Mr. Bill Baker, Chief Executive Officer, Canadian Firearms Program accompanied Minister Cauchon. Mr. Hugh McRoberts, Assistant Auditor General, and Mr. Alan Gilmore, Principal, Audit Operations Branch, accompanied Mrs. Fraser.

Further meetings were deemed necessary to explore this issue fully. Consequently, the Committee met on 17 March 2003 with the Hon. Lucienne Robillard, the President of Treasury Board, and Mrs. Fraser. Mr. Jim Judd, Secretary of Treasury Board Secretariat, accompanied Mrs. Robillard. Mr. McRoberts and Mr. Gilmore accompanied Mrs. Fraser. On 26 March 2003, the Committee met with two former directors of the Canadian Firearms Centre: Ms Maryantonett Flumian (Associate Deputy Minister and Vice-Chairperson, Deputy Minister’s Office, Department of Human Resources Development) and Mr. Gary Webster (Special Advisor to the Deputy Minister, Department of Justice). Mr. McRoberts, Mr. James Hood (Principal, Audit Operations Branch) and Mr. Andrew Lennox (Principal, Audit Operations Branch) appeared on behalf of the Office of the Auditor General of Canada. The Committee met again with Ms. Flumian and Mr. Webster on 7 May 2003. Mr. Gilmore, Mr. Jean Ste-Marie (Assistant Auditor General) and Mr. Gordon Stock (Director, Audit Operations Branch) represented the Office of the Auditor General of Canada.

OBSERVATIONS AND RECOMMENDATIONS

The Auditor General reached two fundamental conclusions based on her audit: the Department of Justice “did not provide sufficient information to Parliament to allow it to fully scrutinize the Program” and the financial information that the Department did provide was “piecemeal” rather than “complete, systematic, and authoritative.” In a news release issued at the same time as her report, Mrs. Fraser asserted that as a result, “Parliament was in the dark”[1] regarding cost overruns and other problems experienced by the Program.

The Auditor General made one recommendation. “Using a meaningful activity-based reporting framework,” she wrote, the Department

[…] should annually provide Parliament in its departmental performance report complete, accurate, and up-to-date financial and management information on the following:

·       the full costs to develop, implement and enforce the Canadian Firearms Program;

·       all revenues collected and refunds made;

·       forecast costs and revenues to the point at which the Department expects the Program to become fully operational, including details on outsourcing major components of the Canadian Firearms Registration System and moving certain headquarters functions to Edmonton; and

·       complete explanations for changes in costs and revenues, and changes to the overall Program.[2]

The Department agreed to all elements of this recommendation. Neither it nor Treasury Board Secretariat contested, in their response included in the chapter, any of the observations or findings contained in the final version of audit report. Both the Minister and President of Treasury Board thanked the Auditor General for her report, and the Hon. Lucienne Robillard called Mrs. Fraser’s recommendations “firm, fair, and constructive.”

The Committee fully endorses the Auditor General’s recommendation and welcomes the commitment made by the Department to act on it. Now that responsibility for the Program has shifted to the Department of the Solicitor General, so has responsibility for implementing the recommendation.

On the afternoon of Friday 21 February 2003, Minister Cauchon presented a plan of action in the House of Commons designed to restructure the Program and reduce its costs. The plan was drawn up in response to recommendations from several reviews, including the Auditor General’s. It will be implemented over the period of one year and includes four actions:

First, reducing costs and improving management, by streamlining headquarter functions, consolidating processing sites, establishing national work performance measurements, and limiting computer system changes to projects that do improve the efficiency of the program.

Second, improving service to the public, by extending free Internet registration and making it more easily accessible and reliable; ensuring clients can easily access 1‑800 telephone information services; processing properly completed registration applications within 30 days of receipt; and implementing a targeted outreach program to help firearm owners fulfill licensing and registration requirements.

Third, holding consultations in spring 2003 to seek input from stakeholders, including parliamentarians and the public, on how to improve the design and delivery of the gun control program, and creating a program advisory committee.

Fourth, strengthening accountability and transparency, by reporting to Parliament full program costs across government, and tabling an annual report to Parliament that provides full financial and performance information on the gun control program.[3]

The Department of Justice provided additional detail in a backgrounder released in February 2003.[4] The backgrounder indicates that the action plan was largely based on the findings of a review of the Program by Mr. Raymond Hession.[5] The last segment of the plan, however, addresses accountability and transparency, which are the principal subjects of the Auditor General’s recommendation. The backgrounder explains that:

The Government will strengthen accountability for the gun control program by making the following improvements:

·       Beginning in 2003-04, the Department of Justice, in cooperation with its federal partners in the gun control program, will report to Parliament full costs of the program across government. The Office of the Auditor General will be consulted in this process.

·       An annual report will be provided to Parliamentbeginning in 2003-04 that provides full financial and performance information on the gun control program. This is consistent with a recommendation of the Auditor General, and furthers efforts made by the Department beginning in January 2002 to report more information, including projected costing, in its Report on Plans and Priorities.

·       A position of Comptroller will be staffedover the next few weeks. The Comptroller will be responsible for risk analysis, data integrity, ensuring resources are spent according to the program’s financial plan, and reporting on results.

·       An annual audit and evaluationplan will review all major components of the program over time, operating on a three-year cycle with the first report on results in 2005.[6]

Further details of the plan were revealed in the Report on Plans and Priorities for 2003 of the Department of Justice. There, the Department indicates that the full federal costs of the Program will be reported in the departmental Performance Report for the period ending 31 March 2003.[7] A proposal by the Canadian Firearms Centre to disclose the Program’s total past and projected expenditures and revenues over the next three years in chart form is included in the report.

An initial review suggests that this action plan, if implemented successfully, should fulfill the Auditor General’s recommendation. However, for greater certainty and precision, the Committee recommends:

RECOMMENDATION 1

That the Department of the Solicitor General prepare, in cooperation with its federal partners in the gun control program, a special report to be filed with the Clerk of the House of Commons no later than 31 December 2003 that provides the full costs of the Canadian Firearms Program across government together with data on the revenues collected and refunds made on a retroactive basis using an activity-based framework in accordance with the government’s regulatory policy.

RECOMMENDATION 2

That in those instances in which retroactive data on costs, revenues, and refunds are not available, the Department of the Solicitor General provide a full explanation in the special report.

RECOMMENDATION 3

That the Department of the Solicitor General include, in its special report, forecasts of costs and revenues to the point at which the Department expects the Program to become fully operational, including details on outsourcing major components of the Canadian Firearms Registration System and moving certain headquarters functions to Edmonton

RECOMMENDATION 4

That the Department of the Solicitor General include, in the special report, complete explanations for changes in costs and revenues, and changes to the overall program.

The Committee also notes that another aspect of the government’s larger plan is to hold consultations on how to improve the design and delivery of the Program. The Committee urges all interested parties to participate and recommends:

RECOMMENDATION 5

That the Government of Canada issue a timetable for consultations with parliamentarians, stakeholders, and the public on improving the design and delivery of the Canadian Firearms Program.

RECOMMENDATION 6

That the Government of Canada include, in the consultation timetable, a target completion date.

RECOMMENDATION 7

That upon the completion of consultations, the Government of Canada table a report containing the resulting findings, conclusions, and recommendations in the House of Commons.

Several other matters were raised by the audit that were not directly addressed by the Auditor General’s recommendation. The Committee believes that these matters, in particular those which involve clarification of roles and responsibilities for the Program as a whole and the use of Supplementary Estimates, require further attention.

In 1996, when the Department of Justice established the Canadian Firearms Centre, the Department and the Treasury Board designated the Centre as the single point of responsibility and accountability to implement the Program. This designation was emphasized in the Project Charter drawn up by the Department in 1997. According to the Charter, the Centre

[…] in its lead role, must provide centralized management and coordination for the Canadian Firearm Program as a whole. In this central management role, the Canadian Firearms Centre must

·       facilitate and support management efforts of the partners;

·       establish, to the extent practical, standard management practices and procedures; and

·       be responsible for representing the overall program to external agencies such as the Treasury Board.

The decision to assign the lead responsibility for the overall Program to the Canadian Firearms Centre made good sense given that several entities were, and continue to be, involved in its delivery. Most participants incur costs and bear responsibility to varying degrees for the outcomes produced by the Program. One department (initially the Department of Justice and now the Department of the Solicitor General) holds the principal responsibility. The Registrar in the Royal Canadian Mounted Police is responsible for registering firearms and establishing and maintaining the Canadian Firearms Registry. Correctional Service Canada and the National Parole Board must administer the sentences of offenders serving mandatory and longer sentences as a result of the new firearms legislation.

Making the Centre the single point of responsibility and accountability was also in keeping with efforts to develop a horizontal approach to policy development and service delivery.[8] Designating a single point of responsibility represented a solution to the fragmented authority, accountability, and performance reporting that poses a challenge to the horizontal model. Despite these advantages, the Auditor General found that the concept was never implemented. As a result, the Centre only reported its costs and expenditures and not the full costs of the Program as a whole to the government.

The Committee sought an explanation from its witnesses. Minister Cauchon stated that because the Department of Justice has no statutory authority over many areas of responsibility where the impacts of the Program are felt, “reporting those costs through a single source would have been unusual.” Unusual but not impossible; the Minister announced that the costs across government will now be reported as part of the government’s action plan to stabilize the Program.

Had this concept of a single point of accountability been implemented from the outset, as intended, some of the problems revealed by the audit might have been avoided. The Program has now been transferred to the Department of the Solicitor General and the government is committed to reporting the full costs of the Program to Parliament; the logical next step would be to formally designate the Centre, now part of the Department of the Solicitor General, as the single point of accountability. The Committee therefore recommends:

RECOMMENDATION 8

That the Government of Canada implement the 1997 Project Charter, making the Canadian Firearms Centre at the Department of the Solicitor General of Canada the single point of responsibility and accountability for the Canadian Firearms Program.

Several federal departments and agencies will continue to participate in the delivery of the Canadian Firearms Program. As such, the Program will still posses all of the characteristics of a horizontal initiative. In an earlier report, the Auditor General has observed that “the more ambitious the objectives of the horizontal initiative, the greater is the need for clarity of partners’ roles and responsibilities in managing, coordinating, and reporting.”[9] The Committee believes that it is imperative to formally clarify the roles and responsibilities of the federal partners in the Program and therefore recommends:

RECOMMENDATION 9

That all federal participants in the delivery of the Canadian Firearms Program clearly set out their roles and responsibilities in a formal accountability framework signed by senior officials, and include this framework in the first report on the full costs of the Program.

The use of Supplementary Estimates to obtain Parliament’s approval for funding for the Program is of particular concern. Between 1995-96 and 2001-02, the Department of Justice obtained about 30% of $750 million in funds for the Program through the Main Estimates; the bulk of the funding, 70% of it, was sought and granted through Supplementary Estimates. This is highly unusual both across government and within the Department itself, which relies on the Main Estimates to cover 90% of the funding requirements of its other programs.

Witnesses offered several explanations for this unusual pattern of funding requests. Mr. Rosenberg stated that the Program was very complex and underwent frequent changes, many of which occurred “off cycle with the government’s Main Estimate process.” Changes, he indicated, “had a major impact on the planning and costing assumptions for the program and that required the use of Supplementary Estimates.” He added that constant change from the outset of the Program made officials “reluctant to include spending forecasts for the program in the Main Estimates.” Minister Cauchon also made reference to constant changes in the Program that occurred off cycle, but added that the Department “used Supplementary Estimates more than (it) should have done.”

Both the Minister and Deputy Minister added that requesting funding in this way had the advantage of providing more precise information on the intended use of the money than is allowed for in the Main Estimates. The President of Treasury Board, the Deputy Comptroller General, and the Secretary of Treasury Board Secretariat also made similar points during their appearance before the Committee.

Although the Auditor General informed Parliament in her report that the Supplementary Estimates were “inappropriately used,” this conclusion is supported more by instinct than by the formal rules surrounding the use of Supplementary Estimates. As the Auditor General herself observed, “the amounts (for the Program) were all voted. There was nothing that we could see that was illegal in the funding of the project.”

There is nothing in the rules to prevent a department from using the Supplementary Estimates to obtain the majority of funding for one of its programs. The House of Commons’ Glossary of Parliamentary Procedure defines Supplementary Estimates as “ An expenditure plan introduced to provide funds to the Government to meet new or increased costs.”[10] The most recent and authoritative work on procedure in the House indicates that

Should the amounts voted under the Main Estimates prove insufficient, or should new funding or a reallocation of funds between Votes or programs be required during a fiscal year, the government may ask Parliament to approve additional expenditures set out in the Supplementary Estimates.[11]

The actions of the Department do not appear to be out of keeping with these descriptions of the Supplementary Estimates. However, while there is no parliamentary convention or rule that prevents departments from using Supplementary Estimates as the principal means of funding programs, there is a case to be made that there ought to be.

The Main Estimates are the means through which government presents the major part of its funding needs that require annual parliamentary approval. Accordingly, these Estimates receive — as is well-known — considerable scrutiny and attention from the media, the private and public sectors, Canadians, and from Parliament. In contrast — and equally well-known among those familiar with the parliamentary Supply process — tabling of the Supplementary Estimates is a relatively minor event that attracts little interest outside of Parliament and the bureaucracy. These estimates are typically used, and are seen as, housekeeping measures to deal with contingencies that were unforeseen at the time the Main Estimates were drawn up.

The issue is complex and of sufficient importance to warrant closer examination. The Committee was therefore pleased to learn that the Auditor General is planning to do an audit of the entire expenditure management system that will include the Supplementary Estimates. The Committee recommends:

RECOMMENDATION 10

That the Office of the Auditor General of Canada proceed with its plans to conduct an audit of the Government of Canada’s expenditure management system that includes an examination of the Supplementary Estimates process.

The issue of the Supplementary Estimates leads to questions about the role of Treasury Board Secretariat. The Secretariat was closely involved with the Program in at least three ways: review of the Estimates and Supplementary Estimates of the Department of Justice; co-chairing a Firearms Control Project Interdepartmental Committee; and, establishing the framework for the Department’s performance reporting to Parliament.

One of the Secretariat’s responsibilities is to review departmental submissions prior to recommending them to Treasury Board for inclusion in the Estimates and tabling in Parliament. Over a six-year period, the Department of Justice obtained 70% of its funding for the Firearms Program through the Supplementary Estimates, a procedure that all agree was unusual. Nevertheless, this approach received the Secretariat’s approval.

In 1997 a Firearms Control Project Interdepartmental Committee was created, co‑chaired (with the Department of Justice) by the then-Deputy Secretary of Treasury Board Secretariat, Alex Himmelfarb. The Committee was expected to meet monthly, or even more frequently, to address issues and concerns. The Secretariat was therefore in a position to gain a thorough knowledge of the challenges confronting the Program.

Lastly, as part of its ongoing activities, the Secretariat is responsible for the Estimates documents, which include reports on plans and priorities, and departmental performance reports. These latter two documents came into existence as a result of a Treasury Board Secretariat initiative — Improved Reporting to Parliament or IRPP — and it was the Secretariat that established and promulgated the fundamental goals, framework, and concepts supporting their use. While the Secretariat does not exercise control over the detailed contents, it does monitor the documents and provides guidance on their preparation.

In 2000, Treasury Board Secretariat released Results for Canadians: A Management Framework for the Government of Canada setting out a modern management agenda for the public service. The document informs departments and agencies that:

The foundation of results-based management is accurate and timely performance information. Departments and agencies need to implement an information regime that measures, evaluates and reports on key aspects of programs and their performance in core areas; holds managers accountable for achieving results; and ensures unbiased analysis, showing both good and bad performance.[12]

Yet few hints of the problems being encountered by the Program appeared in any of the Department’s performance reports. The only exception, in departmental performance reports to Parliament between 1996-97 and 2001-02, is found in the report for the period ended 31 March 2000. Here one discovers that:

During 1999-2000, the opting-out of key provinces and territories, and their challenge to the constitutionality of the legislation in the Supreme Court seriously impaired the basic design model for the program making the original planning assumptions invalid; and overly complicated forms were prone to high error rates leading to significant backlogs and delays in the processing of applications and the issuance of licences.[13]

There was no linkage made, however, between these setbacks to the Program and the costs incurred as a result. This stands in contrast with Treasury Board Secretariat’s description of its business line that “leads the reporting of results to Parliament, ” the comptrollership business line, that it “collaborates with departments and agencies to integrate financial and non-financial performance information.”[14]

Other opportunities were available to the Secretariat to convey to Parliament the challenges being faced by the Program and the resulting cost overruns. Officials from the Secretariat appeared regularly before the Senate Committee on National Finance to discuss Supplementary Estimates.

In 1997, Richard Neville appeared before the Committee, in his capacity as Assistant Secretary, Expenditure Management Sector, to discuss Supplementary Estimates (B) for 1997-98. Mr. Neville was asked about a request for additional funding for the Program. He explained that the Program was being developed in phases and advised the Committee that as the Program’s “needs become more clearly identified, it [the Department] will be returning to Parliament with specific requests, either as part of the Main Estimates or as future Supplementary Estimates.”[15] He added that he was “familiar with the project, having been involved in the Treasury Board submission at the time.”

When Mr. Neville was asked why it had not been known several months previously that development of a software system would increase from $9 million to $21 million, he replied the Committee was “seeing the cost of the system developing. It is very normal.”[16]

In 1999, in an appearance before the same Senate Committee Mr. Neville testified that the total planned spending on the Program had risen to $309.7 million. He attributed the increased costs to provincial withdrawals from the Program, changes made to the legislation and “a number of issues with technology as well.”[17]

Mr. Neville was back before the Committee in 2002, testifying that the cumulative gross expenditures incurred by the Program since 1995 amounted to $688.3 million at the end of 2001-02. He added that other costs would bring total federal gross expenditures to $810.8 million by the end of 2002-03.[18] Asked if Treasury Board Secretariat was concerned about the growth of spending on the Program, Mr. Neville replied that the Secretariat was “extremely concerned about this file.”[19] The following month, the Auditor General submitted her December 2002 report to the House of Commons.

In summary, as the central agency that was closely involved in the Canadian Firearms Program, Treasury Board Secretariat was aware of problems and the resulting cost escalations. As the President of Treasury Board acknowledged, Treasury Board Secretariat “was involved in an interdepartmental committee. Thus, up-to-date information was available throughout all those years. And so, we were kept informed about the program.” Yet very little, if any, of this information found its way into the Department’s performance reports drawn up under the Secretariat’s guidance, and very little of it reached Parliament except, as the Auditor General claims, in a “piecemeal” fashion.

While it may seem illogical that Treasury Board Secretariat should establish the terms for departmental performance reporting to Parliament but not ensure that these terms are met, it is not unusual. In her report for 2001, the Commissioner of the Environment and Sustainable Development (located in the Office of the Auditor General of Canada) found that only 7 of 28 departments had complied with Treasury Board Secretariat’s guidelines for reporting on the performance of their sustainable development strategies.

Commissioner of the Environment and Sustainable Development Gélinas reported that she “had found no evidence to suggest that any agency had been holding departments to account for their lack of compliance,” with performance reporting guidelines. “If guidance is developed and issued,” she argued, “there is also a responsibility to monitor adherence to the guidance, and to question non-adherence.”[20]

The Commissioner’s observations apply equally to the manner in which the performance of the Canadian Firearms Program was reported to Parliament. The Department of Justice was quite clearly not held to account for its inadequate reporting on the Program’s performance by the central agency that would have known most about it. Better coordination and quality control must be exercised over the performance information that is reported to Parliament. As the President of Treasury Board told the Committee, Treasury Board Secretariat “will have to become much more active in overseeing the quality of those reports.” She added that “the situation has also sent a strong message to the Treasury Board Secretariat, which has to be much more proactive in overseeing information quality.” The Committee concurs wholeheartedly with Mrs. Robillard and accordingly recommends:

RECOMMENDATION 11

That Treasury Board Secretariat begin immediately to monitor departmental performance reports actively and work with departments and agencies to ensure adherence to its guidance, paying particular attention to the need to present balanced, complete, accurate reports, and to integrate financial with non-financial performance information.

RECOMMENDATION 12

That in its monitoring activity, Treasury Board Secretariat devote particular attention to performance reporting on horizontal issues, areas of high risk and programs and activities involving significant levels of expenditure.

RECOMMENDATION 13

That Treasury Board Secretariat begin to provide information on its monitoring of performance reports and its review and approval of departmental and agency spending proposals. This information should reference: the human and financial resources devoted by the Secretariat to these activities; the number of reports monitored and corrective interventions made; and, the number funding requests reviewed, amounts involved, changes requested, and final approvals given.

There is one other matter, arising from the hearing between the Committee and its witnesses, that is disquieting. This involves a disagreement between officials from the Office of the Auditor General and the other witnesses concerning the status of the Program as a major Crown project.

Major Crown project status is based on cost — over $100 million — and the presence of high risk. This status imposes higher levels of management rigour and scrutiny coupled with enhanced reporting requirements. The Auditor General indicates that Treasury Board policies require departments, at a minimum, to annually report the following types of information to Parliament with regard to their major Crown projects:

·       description of the program,

·       leading and participating departments and agencies,

·       total expenditures to date and planned expenditures for future years to the completion of the project,

·       prime and major sub-contractors,

·       major milestones, and

·       progress reports and explanations of variances.

The Auditor General reported that the Program had been “designated as a major Crown project but that many of the reporting requirements had not been fulfilled.” This observation — along with two other references to the Program’s status as a major Crown project — survived the vetting process which all audit reports by the Auditor General undergo with subject departments prior to final release.

Yet during the first meeting with witnesses, the Deputy Minister of Justice stated that although Treasury Board Secretariat “exercised more direct control” over the implementation of the Program, he did not believe that Treasury Board “ever designated the Program as a major Crown project.” At a subsequent meeting, the Auditor General reiterated that the Program held this status. Minister Robillard in turn testified that she had been “unable to identify any Treasury Board decision designating the initiative as a major Crown project,” but added that

There is, however, general agreement that the project was to be managed in the manner of a major Crown project, which is to say managed in a rigorous manner.

The President of Treasury Board described the Secretariat’s clearance of the Auditor General’s Report containing references to the Program as a “major Crown project” as “an oversight.” Both Mrs. Fraser and Minister Robillard asserted that major Crown project status was beside the point; the major concern was the quality of the information reported to Parliament. Later on, Mrs. Fraser characterized the issue as “minor” and “very technical.”

At first glance, the disagreement appears to involve semantics. In her report, the Auditor General uses the word “designate.” In turn, the Deputy Minister of Justice denied that the Program had been “designated” a major Crown project. But terms must be used with precision in this context. The words “designate,” and “designated” do not appear in Treasury Board policy on major Crown projects. Instead, the policy states that “A project is deemed to be a major Crown project when its estimated cost will exceed $100 million and the Treasury Board (TB) would assess the project as high risk.”[21] There is an important difference between the terms “designated” and “deemed” with the former meaning “specified” and the latter commonly meaning “considered to be” or “judged to be.” Thus while saying that the Program was never “designated” as a major Crown project may be correct, it does not necessarily mean — in terms of the way the policy is framed — that it was not a major Crown project. The Committee believes that this is an important matter and recommends:

RECOMMENDATION 14

That Treasury Board ensure that its policy on major Crown projects is clear and that it be consistently applied to all projects that meet its criteria.

In response to a request by the Committee, Mrs. Fraser sent a letter to the Committee dated 26 February 2003 in which she outlined six documents that she had used in determining that the Canadian Firearms Program was a major Crown project. In her letter, she wrote that a “review of government documents related to the Canadian Firearms Program clearly indicated that the Program was a major Crown project.”[22] A second letter, again in response to a Committee request, dated 15 May 2003, listed an additional four documents said to contain references to the Program’s status as a major Crown project. In light of this, continued insistence that the Program was not a major Crown project raises the possibility that some witnesses either lacked basic information relating to their responsibilities or may have been less than entirely forthright in their testimony.

Given the latter possibility, the Committee wishes to emphasize that the effectiveness of external audit in parliamentary systems relies a good deal upon mutual trust among the parties involved. The Auditor General must be confident that departments and agencies will provide assistance and full and open access to all relevant documents, as legislation requires. Departments and agencies must be able to trust that the Auditor General will be unbiased, fair, and balanced in conducting her audits and presenting her findings. For its part, the Public Accounts Committee must have confidence in the professionalism and probity of the witnesses that come before it. Departments and agencies, in turn, must trust the Committee to take their testimony into account before reaching conclusions. This is the relationship that exists now. It has been built over generations, but it could be easily undone. If any of its elements become eroded, then the process cannot function in ways that will produce solutions that are credible and constructive, and government that is more effective, economical, and efficient.

The Committee asks that the parties involved in this audit and others involved in future audits, think very carefully about this relationship and the consequences that would surely follow should it break down.

CONCLUSION

Government and Parliament share the desire to see results-based management with a citizen focus adopted in all departments and agencies. Making this change requires enhanced transparency and accountability surrounding delivery of programs and services. The results of this audit demonstrate that these conditions have yet to be fully achieved. It is vital, therefore, that lessons be drawn from this experience that will contribute to the improvement of communications between the administrative component of government and Parliament.

In particular, those responsible for the administration and delivery of complex and controversial programs must meet, and if possible exceed, formal requirements when it comes to reporting performance and cost to Parliament. Given the scrutiny that such programs attract, it is inevitable that any lack of diligence in such matters will come to light eventually. When this happens, the policy that the program was meant to deliver risks being discredited.

Plans to act on the recommendations of the Auditor General show that some of these lessons have been learned and are being applied. Positive response to the recommendations made by this committee will strengthen that impression.

Pursuant to Standing Order 109, the Committee requests that the government table a comprehensive response to this report.

A copy of the relevant Minutes of Proceedings (Meeting Nos. 16, 19, 22, 28 and 44) is tabled.

Respectfully submitted,

JOHN WILLIAMS, M.P.
Chair