Thank you for that very kind introduction, Mr. Chairman. Good morning to you.
Honourable members, good morning. I would also like to say good morning to the guests of honour who are here shadowing some members today.
I am joined today by Mark Watters, the chief financial officer of the House of Commons, and by two people who have devoted themselves to the cause of making me look smarter than I am, Suzanne Verville, my chief of staff, and Kori Ghergari, who is with the corporate communications directorate.
This morning I'm delighted to be here to have a chance to discuss with you the role of the Board of Internal Economy. As Clerk of the House, I am Secretary to the Board of Internal Economy. I want to state at the outset that I'm here today as the Clerk and Secretary to the Board, but I don't speak for the current Speaker, Speaker Scheer, or past Speakers, or for the current Board of Internal Economy, or for any board members. I'm basically here in my capacity as somebody who's been Clerk for over eight years. I've been a parliamentary official for over 33 years, so eyes may glaze over and you may think, “She's here to defend the status quo”, which is not actually the case, but you'll find out more as we go along.
I paid a great deal of attention to the terms of the order of reference that you have, and was struck by the fact that in the very first phrase you have the term “full transparency” and you mention the concept of accountability. That seemed to be a good place to start discussing things this morning.
I want to look, in the first instance, at the disclosure measures already in place and to the web presence that we—and when I say “we”, I'll be referring to the House administration and the Board of Internal Economy—have on the Internet.
I think it's important to realize that in the sometimes quite heated discussions of the past weeks and months, there has been a certain amount of confusion when people are talking about what is disclosed or isn't disclosed. It's been my experience over these 33 years that one has to take everything one hears with a grain salt. I think this morning it'll be useful to see exactly how the board has approached this whole question of disclosure, particularly in the 40th and 41st Parliaments.
What I'd like to start with, then, is the Parliament of Canada website, to show you what's available to the public if one were to google the Board of Internal Economy.
If you search for "Board of Internal Economy"…
you are brought right away to the main page of the parliamentary website, parl.gc.ca. The board section is also accessible from the main page of the Parliament of Canada website. There's permanent access under the “House of Commons”. Under the “What's New?” rubric you'll find such things as the newest information that has been posted—statements, media advisories, and so forth. In the package of information you have been given, you will find copies of what I am presenting, together with copies of certain statements that have been issued by the board. All this is available on the web.
The section “About the Board”, starts with introductory comments on the nature of the board, including its legislative foundation in the Parliament of Canada Act and its membership. It's important to note that the board's membership consists of the Speaker, who acts as its chair; two members of the Privy Council, who are appointed to the board by the government; the leader of the opposition and his or her representative; and additional members appointed in numbers so that the total result is an overall equality of government and opposition representatives. Of course, that's not counting the Speaker.
The current actual membership, in terms of individuals, is made up of the government House leader, Minister Van Loan; the chief government whip, Minister Duncan; the Honourable Rob Merrifield;
…the , Mr. Cullen; the whip of the official opposition, Ms. Turmel; and the whip of the Liberal Party, Ms. Foote.
At its meeting of June 3, 2013, the Board of Internal Economy decided to post its minutes on parl.gc.ca retroactively to the start of the 41st Parliament. Board minutes continue to be tabled in the chamber, which is a practice that has been in place since the 34th Parliament.
The board meets about every second week when the House is sitting, and, of course, legendarily, it meets in camera. The meetings are in camera, and the board operates largely by consensus, so the board minutes are not in extenso in respect of the discussion that has gone on but are simply records of decision. The board frequently considers confidential matters, including legal issues, issues related to labour relations, and issues related to security.
The exact timing for the tabling and posting of board minutes will vary because it depends on the scheduling of the board's meetings. Time was, when you had three board meetings—let's call them A, B, and C—you would have meeting A take place and the minutes from meeting A would be approved in meeting B. Then they would come back to meeting C to be approved for tabling. As of yesterday, the board, I am happy to say, agreed to do away with this belt-and-suspenders approach. So there will be approval of the minutes from meeting A at meeting B, and then they will be ready for posting. They don't have to come back to a third meeting, which might well mean another two-week delay.
Depending upon the matters being discussed, however, some minutes are tabled to coincide with the tabling of other information such as the Public Accounts of Canada—or, one thing that everybody is familiar with, the main estimates. The board considered the main estimates yesterday and made certain decisions. Those minutes, though, will not be available until the President of the Treasury Board tables the main estimates in the House in April.
There are some additional features of the minutes. There is a subject index that's available to facilitate access, and there are hyperlinks in the minutes themselves, which will direct the user to useful information on many subjects that are referred to therein.
I'd like now to turn to the bylaws of the board. As you know, the Board of Internal Economy is enshrined in the Parliament of Canada Act, and it is from this statute that the board derives its authority to establish bylaws.
In general, the by-laws established by the Board of Internal Economy form the basis for all decisions on internal economy and governance in the House of Commons as an institution.
These bylaws are the foundation of governance. They form the basis of policies and guidelines regarding the resources that members have access to for carrying out their parliamentary functions, and they grant authority to me, as Clerk, reporting through the Speaker to the board, to execute the directives of the board through the administration of the House.
The four bylaws are the “Members By-law”, which, as you can tell by the title, refers to the members and definitions of such things as parliamentary functions, etc.; the “Committees By-law”, which talks about how committees are funded and how they carry on their work; the “Governance and Administration By-law”, which is basically, for me and the administration, the important bylaw that delegates to us certain authority from the board to act on its behalf in executing its directives. Finally, there are the rules of practice and procedure of the board, which are basically the standing orders that the board has set up for itself in terms of how it is going to proceed. These are legally binding on members and they take precedence over any administrative manual or general policy decision.
The bylaws date back to 1993. From 1993 to 2010, they were revised from time to time on a case-by-case basis. But in 2010 the Board of Internal Economy agreed with a recommendation to proceed with a comprehensive review of the bylaws, a project to update and consolidate them. The revised bylaws were approved by the board on November 21 and December 5, 2011, and they came into force on April 1, 2012. The revised bylaws were posted on the Parliament of Canada website on April 2, 2012.
The document that gets, I suppose, the most attention with regard to disclosure and web presence are the Member's Expenditures Reports. But I also want to point out, because this is not necessarily all that well known, that the audited finance statements for the House of Commons and two administrative planning documents are also available online.
The board believes strongly that an annual external audit of the financial statements is a key component of sound management practices. Once again, the audit for 2011-12 of the House of Commons' financial statements has resulted in an unqualified audit opinion. The auditor is of the opinion that financial statements present fairly the financial position and the results of operations of the House. The auditor's work included gathering evidence about the amounts and disclosures made in the financial statement and assessing the risks of error, fraud, or misstatement.
The auditor also evaluated the appropriateness of the accounting policies that have been selected, as well as the estimates made by management. The audited financial statements for fiscal year 2012-13 and the Report to Canadians 2013 will be posted online a little bit later when the board has had a chance to consider it. The board approved the report yesterday at its meeting and we expect that the financial statements audit will be forthcoming.
There is a section
…which consists of a FAQ section, which was given considerable thought. Another section covers the media, allowing the Board of Internal Economy to issue media advisories and statements from time to time, especially on the website.
So media advisories and statements that are issued by the board are also available online, as well as the FAQs—frequently asked questions—on various subjects.
The Board of Internal Economy designated two spokespersons to interact with the media. These spokespersons work closely with Heather Bradley, the communications director for the president's office. The two spokespersons are the NDP whip, Nycole Turmel, and the Chief Government Whip, the hon. John Duncan.
Minister Duncan and Madam Turmel are the spokespeople for the board and, again, there you'll see the balance that is kept in terms of the approach of the board in its communications. The board speaks with one voice. These spokespeople respond to questions related to the board--if there are any asked during Question Period, for example--and they also respond to inquiries from the media, working, as I said a little earlier, with the Speaker's director of communications, Heather Bradley.
Now let's come to the whole question of the members' expenditure report, which has been the subject of a great deal of public discussion and discussion in the House in the past little while. The “Members' By-law” provides that the Speaker of the House of Commons, on behalf of the Board of Internal Economy, ensures the publication of the members' expenditure reports on the Parliament of Canada website. These have been posted online since 2001-02 and you'll see on the slide that you have PDF versions from 2001-02 to 2008-09. I'd like to call up the 2001-02 report and, for those of you who may be frustrated with the degree of disclosure that we now have, you could perhaps console yourselves that we have come a very long way. The 2001 report, which I remember as being the subject of great controversy at the time, is pretty thin gruel when you look at it now. There are a number of headings. There isn't very much explanation. There are two pages of explanation at the beginning of these. None of this, of course, is interactive; you can't select groups of people, or regions, or any of that kind of thing.
Starting in 2009-10, the board agreed to a recommendation for extensive improvements to the reporting format of the individual member's reports, displaying the data in easier to understand columns and rows and providing for a more detailed explanation of each aspect of the report. Improvements have continuously been made with each tabling of the report.
It wouldn't be a committee meeting if I didn't tell you that, unfortunately, we have a little technical glitch. For reasons I can't figure out, the computer that lets us see the French version can't connect to the Internet. So there may be some inconsistency between what we will see in English and what we will on the other computer, while we try to access the Internet. I'm sorry. We practised this yesterday, but unfortunately it was in another room. We will do better next time. Here we go.
I'll tell you some time about my James Thurber parallel to me and technology, so you'll understand that I come from a long way off.
Back to the MERs, the members' expenditure reports, and looking at the summary report of members' expenditure report as well as the reports by individual members, we'll call up 2012-13. You'll see at the beginning of this there's a very extensive discussion of the entitlements—the allowances and services—under different rubrics so that users can understand better what members are entitled to, because, of course, this is a finite set of entitlements. It's not a case of members being able to go back to the board to ask for something more after the fiscal year starts if they find that they have been a grasshopper rather than an ant in terms of managing the resources that are given to them.
You will see a comprehensive introduction on the resources provided to members and you see, of course, the individual reports and the summary of reports. There is a report-generating tool that allows the user to select a single member or a group of members by name, by province or territory, by constituency, or by party and to group them together for presumably comparative purposes. There is also a rollover feature that allows the user to read the description of the category of expenses from the online report.
The board decided in November 2011 to further the detail of disclosure by displaying each type of traveller's expense on a separate line. There are four types of travellers that are permitted to use the resources: the member himself or herself; the designated traveller, the person designated by the member, who is usually a spouse or partner, though sometimes a parent or a sibling; a dependant; and, of course, an employee. Along with displaying each type of traveller's expenses they also display the number of regular, special, and U.S.A. points that are used. One regular point is basically one return journey between Ottawa and the constituency: a half point to go and a half point to come back. There are 25 points out of the total of 64 that are allocated as special. They allow the member to travel from the constituency to any other place in Canada. Four of those can be used for travel to the United States, but only to Washington, D.C., or New York because of the presence of the United Nations.
There's also a further change in the 2012-13 report that presents secondary residence expenses separately from members' accommodation and per diem expenses.
As I mentioned earlier with regard to the format, we started off in 2000 and 2001 with PDFs with a print feature that automatically included the expanded explanation. We now have the expanded explanation for each column and expenditure category, and the XML format we have for the 2012-13 reporting period allows the analysis of report data in spreadsheet software.
On October 23, 2013 the Board of Internal Economy issued a statement on measures it was going to take in order to improve this reporting further. Where you had both contracts for services and full-time employees listed as one total, under the employees' category the enhanced disclosure format will now break that down into contracts and employees' services. There will be employees' salaries and service contracts.
Similarly, members' accommodation expenses will be separate from per diem expenses. Currently members' accommodation expenses and per diems are in the same line.
Similarly, we will subdivide the hospitality category into events. Those are usually the summer barbecues, the winter skating parties—those kinds of things—protocol gifts, and meetings.
The special point disclosure is also going to feature more information because the regular points, as I said earlier, are basically simply travel between the constituency and Ottawa. Special points are different. They are travel to another destination. So, the details of the use of all special travel points will be disclosed. You will have the information about who the traveller is, the destination, the dates of departure and return, the reason for the travel, and the total transportation cost. As I said earlier, there are 25 special points available. A maximum of four are for travel in the United States. The others are for travel within Canada.
I should say in talking about this disclosure that I hope the committee won't mind if I sound a bit of a cautionary note about trying to make too close a parallel between disclosure of members' expenses for travel and disclosure of ministerial expenses for travel. I sometimes worry—in fact, I worry a lot—that such a parallel can lead to false conclusions. A minister's office, naturally enough, looks at travel and logically sees that concept as so many separate trips. You have a separate trip. You're going somewhere with x number of people accompanying the minister. The minister is going for a particular reason: depart and return. There will be accommodation in hotels. There will be transportation. It makes a nice little package.
Here at the House, we don't tend to think of members going on trips; we think of them as travelling, which is basically travelling between the constituency and Ottawa. When they go to the constituency, they're going home, so there's no accommodation there. When they come back here, it's to accommodation they've set up in Ottawa, usually apartments. It's not usually hotels, as they tend to be very expensive over the long run. So that becomes a false kind of parallel.
The other thing is that members who are in Ottawa at the House are given per diems because they're in travel status. So the parallel is not infallible. It is true, though, that members can be accompanied by their designated traveller or dependants or employees. That information is disclosed in the MERs.
The good news today—I don't want to steal the board's thunder, but I checked with them yesterday, and they told me that I can tell you—is that there are two more documents that will be available. They are actually public documents that will be posted in the near future. The Members' Allowances and Services manual has been a public document for a long time. It was available, for instance, for the media to consult in the library, and there was the director of communications in the Speaker's office with her long-suffering cut-and-paste of bits of information that she would send in answer to questions. But this will be posted on the web, as will the public registry of designated travellers. That will be available.
I thank you for bearing with me. Many of you may well be attuned to what has been on the web and what's available as disclosure. I thought it would be useful to do that, because I've been troubled by some of the discussion I've seen that seemed to me not particularly well informed in terms of what is already available.
Now I'd like to turn to the question of governance. From my point of view, it is in the governance structure that you see the notion of accountability embedded.
You can see the schematic here that shows the Canadian parliamentary system.
For our discussion today, we'll talk about the House of Commons as a legislative body, of the 308 members of Parliament and of the House of Commons administration. I'll focus on these three aspects in a minute.
If we define the House as the democratic institution at the heart of the Canadian parliamentary system, then we come up with certain realities. It is independent. Its independence is guaranteed by the law of parliamentary privilege.
It is made up of 308 members, soon to be 338 members. It is the House of Commons as a collectivity that is the institution.
These members are independent of each other and of the House itself. Certainly most of them will belong to a caucus. The caucus will have its own internal ways of operating and supporting its members. But for our purposes in the administration, each member is considered to be an individual who has been elected by Canadians to support, to represent, his or her constituents. Therefore we bring to that member, as an individual, the full support for the work they do in their parliamentary functions.
The House of Commons is independent of government. In order to have that principle mean something, it is, of course, self-regulating. Here again we note that the Government of Canada laws, acts, and policies—for instance, the Financial Administration Act or the guidelines of the Treasury Board—do not apply to the House.
That also is something that, if it is taken out of context, can lead to misunderstandings. This is not to suggest that this is the wild west and that anarchy rules. The point is that it's the Board of Internal Economy, finding its legislative authority in the Parliament of Canada Act, that basically drafts the framework within which the work of the House of Commons is carried out.
We have, for example, the Financial Administration Act. It doesn't apply to us, but we conform to the usual stewardship and, as I mentioned earlier about the accounting or auditing of the financial statements, the appropriate principles for a stewardship of public resources.
Similarly, the House of Commons develops and applies its own policies and procedures to support effective stewardship of public resources. For example, the Canada Labour Code, part III, has not been promulgated to apply to the House of Commons, and yet we have made a point of having our human resources directorate developing, in consultation with the unions, health and safety policies that are as robust, if not more, than the provisions in the code itself.
Ultimately, the House of Commons is accountable to the people of Canada because, of course, the general election that everybody has to submit to now on a fixed calendar is where that accountability...where the chickens come home to roost.
I won't talk very much about the House as a legislative body because that's really not germane to our discussion this morning, except to say, of course, that the governing authority there is the House. The House sets the Standing Orders that define how deliberations will unfold.
The Speaker, elected by secret ballot of all members, is the presiding officer and makes decisions on points of order and questions of privilege, and your own committee of procedure and House affairs has the standing mandate to look at the Standing Orders and, of course, to look at such questions as these which go to the very heart of the administration of the House.
The legal framework for the House as a legislative body encompasses the law and custom of Parliament, of course, including the applicable provisions of the Constitution and the law of parliamentary privilege. And, then, of course, there's the Parliament of Canada Act itself, which is understood to be a constitutional statute, covers the operations of Parliament, the privileges and powers of the House of Commons and the Senate, as well as the Library of Parliament, and the administration of both Houses and of the Library.
It is in dealing with the House as a legislative body that the Speaker and the Clerk bear responsibility for procedural matters. I'll be returning to this briefly later in the presentation.
The governance that interests us this morning, I think, is the governance structure for the 308 members who constitute the House of Commons as a legislative body and a collectivity, and their work, the carrying out of their parliamentary functions in their constituencies and committees or associations, in caucus, and of course in their offices, and the administration of the House, which is basically the bureaucracy that supports members in their parliamentary functions.
As I mentioned earlier, the Parliament of Canada Act is the statute from which emanates the board's authority for this governance. It establishes bylaws, and the bylaws regulate the use of parliamentary resources that are made available to members.
The decisions of the Board of Internal Economy are final, and the Members' Allowances and Services manual is where those policies are gathered together, that is, the policies approved by the board to be executed by me as the head of the administration and the people I work with.
In your information package we have included an overview of the history of the board.
The board's research section prepared this overview for us. I'll spare you the summary of the entire history, but I would like to mention a few dates and point out that the concept of internal economy goes back to 1868.
There, in 1868, there was An Act respecting the internal economy of the House of Commons. The internal economy was put in the hands of the Speaker and four commissioners, all of whom were privy councillors who were members of the House.
In 1886 that act was integrated into a new act, which was called an Act Respecting the House of Commons, and it had a section on internal economy. Basically, that remained unchanged for 86 years.
In the 1960s and 1970s there were various studies of the organization of the House of Commons. In 1964-65 there was a Special Committee on Procedure and Organization. In the 1970s there was a lot of concern and debate about this whole idea that the membership of the board was limited to ministers and that the members had no say. In 1974 the Standing Committee on Privileges and Elections also did a study relating to that.
In 1979, in November, the Report of the Auditor General, which had been undertaken at the request of the then Speaker, revealed that there were significant vulnerabilities, and not to say significant “vacancies”, shall we say, in the whole administrative structure of the House and in the way the stewardship of public resources was being handled.
That led to a flurry of changes, which brought in a bureaucracy that was similar to and based largely on how the public service was organized at the time. There was, for a brief time, someone called an “administrator”, who was ostensibly in charge of the administration of the House. That led to the confusion, you can imagine, in which there was a Clerk and an administrator and a Sergeant-at-Arms, who were like co-deputy ministers. They did not get along nearly as well as the Trinity. I can tell you that from being the actual chief of staff to the Clerk at the time.
In 1984, the Special Committee on Reform of the House of Commons was created. That was chaired by the veteran MP James McGrath, and it became known as the McGrath committee. Really, it undertook an ambitious series of studies of both procedural principles governing the House and of the principles underpinning the management of the House and its committees. It tabled three reports, all of which elicited government responses but none of which was adopted.
At the same time, I think it's important to note that the McGrath committee was really the intellectual cornerstone for the development of the House into the institution that we know today. For instance, it's there that you will find the roots of the way in which the Speaker is now elected by secret ballot without domination by the parties and so forth, the notion of private members' business—all kinds of ideas. It was a tremendously creative exercise, and it really can be regarded as the touchstone for where we find ourselves today.
In 1985, Parliament adopted the Parliament of Canada Act, which consolidated three acts: the House of Commons Act, the Senate Act, and the Library of Parliament Act. It replaced commissioners by a Board of Internal Economy chaired by the Speaker with, as members, the Deputy Speaker; two privy councillors; the leader of the opposition or his or her nominee; and two members of the opposition, at least one of whom comes from the official opposition. That change was made specifically to give a voice to all members and to give an equality of voices in the representation to the government and the opposition.
In 1986, Parliament passed the Parliamentary Employment and Staff Relations Act, whereby it created the Board of Internal Economy as the employer of record for some...well, now we're about 1,800, if we count part-time staff. The board is the employer of record for those staff people in the House of Commons who report through the services to me. It sets the terms and conditions for the unrepresented employees as well as the negotiating mandate that we take to collective bargaining with the unions.
In 1989, another special committee was created, this time chaired by Deputy Speaker Marcel Danis.
This committee also looked into how the Board of Internal Economy was set up.
In 1991, Bill gave the Board of Internal Economy the authority to control how MPs spend their budgets and use parliamentary resources.
It's important to realize that it was the 1991 amendments to the Parliament of Canada Act that gave to the Board of Internal Economy the authority to establish bylaws that would govern the spending of MPs' budgets by MPs and their use of parliamentary resources. For instance, in the case of travel, the money comes from a central fund of the House of Commons.
It was also that bill that provided that the Clerk of the House of Commons become the secretary to the Board of Internal Economy.
It was then that the bylaws of the board were drafted. These were approved at the end of March 1993 and were tabled in the House for the first time on April 19, 1993.
In 1997, you may remember, there was a proliferation of opposition parties in the House, and in order to deal with the composition of the board—to accommodate this larger number of opposition parties—Bill C-79, An Act to Amend the Parliament of Canada Act, addressed that composition, adopting a formula that would allow for the future configuration of parties but maintain the very important principle of the equality of government and opposition representation.
If you're especially interested in the history of the board, there is that brief history prepared by the Table Research Branch in your briefing material. There's also a very useful article that I found, which was written by two of the Library of Parliament analysts who have extensive experience in the House. I believe James Robertson was once the analyst for this committee, and James Robertson and Margaret Young contributed this article to the Canadian Parliamentary Review, the winter issue, in 1991-92. I think it provides a helpful explanation of the circumstances surrounding the board's creation.
I realize this kind of history may seem tedious, but we get to the place where we are because of certain circumstances and because of certain influences, and it's important, I think, to realize that there's been a tremendous amount of thought that went into the creation of the board and the ameliorations that we've seen over time.
It's the board—and it's been discussed in this respect in the newspapers and in the media—that provides members and House officers with their entitlements, allowances, and services to support their parliamentary functions. This is all detailed in the Members' Allowances and Services manual.
The basic principle that underlies the approach of the administration and informs my work as Clerk of the House is that each individual MP is directly accountable for the use of parliamentary resources that support the work in their offices as they carry out the parliamentary functions entrusted to them on their election. From that individual accountability of each MP flow the independence and the flexibility enjoyed by each MP to manage the budget allowances and services provided to the MP in those functions.
Thus, you will see that the “Members By-law”, as the name suggests, lists and goes through extensive definitions and establishes the framework within which members are to operate. It gives an enormous amount of independence to individual members, because the fundamental principle here is that it's up to the member to judge how he or she will represent his or her constituency. That freedom is required so that the members can set their priorities and decide what assistance they will require to achieve them.
As I said earlier, each political party determines how it will support its caucus members, but from our point of view, we look at each individual MP as an independent entity.
Each MP is the employer of record for each person hired on staff or on contract, because it's the individual MP who sets the terms and conditions of employment for staff and then decides on deliverables and the value of the contract that they may sign. It's the individual MP who decides where the staff will work, whether in the constituency or on the Hill, and what their responsibilities will be. The individual MP decides how many constituency offices he or she will need to lease, where the offices will be located, and how they'll be staffed. And it's the individual MP who decides how to shape the relationship with the constituency and how he or she will communicate with citizens.
Generally speaking, these fundamental decisions determine how the MP will decide to allocate his budget. Once staff has been hired and office space has been leased, a significant portion of the member's office budget, the famous MOB, has already been committed. The MOB is allocated to each member each fiscal year, and the member is personally liable for any and all expenses incurred above those allocations.
The expenditures are processed by Finance Services—and Mark will be telling you a bit more about that in a little while—and are captured in the member's expenditure report, so that every dollar that is spent within members' budgets is reported on. These expenditures are then further captured in the Public Accounts of Canada.
But along with this central role of being responsible for the resources that are given to members, the board has a wider role. It examines and approves the annual estimates of the House, that is to say, the main estimates and the supplementary estimates. It approves and controls the budget expenditures of committees of the House and of International and Interparliamentary Affairs. The committee envelope is given to the Liaison Committee, which then distributes it as requests come to it from the standing and standing joint committees.
Similarly, the Joint Interparliamentary Council, which is chaired by the chair of the Senate internal economy committee and the Deputy Speaker of the House, is the council that is set up to deal with the envelope of money that is given to interparliamentary associations.
As I said earlier, the board is the employer of record of the staff of the House of Commons, and in being that employer of record, it conforms with the terms of the Parliamentary Employment and Staff Relations Act. It approves salary scales for non-unionized employees. It authorizes us to negotiate the renewal of collective agreements with unionized employees, and it ratifies those agreements after those negotiations are done.
We currently have about 1,800 employees, including those who are not represented, and the unions. There are seven bargaining units of which four have bargaining agents.
The board also, of course, governs the security of the House of Commons precinct. In security and other matters, for example, the long-term vision and plan for the renovation of the parliamentary precinct, the board partners with its counterpart in the Senate for the management and security of the precinct.
I have been talking about the framework for the 308 members. I'll just say a few words about the framework for the administration. You've noted the “Members' By-law”, which governs the allowances and services available to each member. The “Governance and Administration By-law” delegates to the Speaker and the Clerk the authority to oversee the administration, and it in turn is responsible for executing the directives of the board on various issues.
In the governance structure in the organigram that you see before you, the Board of Internal Economy is at the very top in deciding on budget and policy. Those policies are then left to the Speaker who operates something like a minister in a government department, and I operate as the equivalent of his deputy minister in the House of Commons. Two people in my office report directly to me. One is the director of internal audit, and the other is Suzanne Verville, who is my chief of staff and the director of corporate communications.
On the last line there, there are the six senior officials who are the heads of services. They report to me on their different responsibilities and we sit together as the Clerk's Management Group. I preside over meetings of those six people. You have the Deputy Clerk, who is in charge of procedural activities. The Sergeant-at-Arms is in charge of security and the physical plant of the building, and in so being he's obviously working with Public Works and Government Services on the renovations. There is the Law Clerk and Parliamentary Counsel, who provides advice on legal issues as well as running the legislative services that draft private members bills and amendments to government bills. Then you have the three senior people who one would find in any organization: the chief information officer, who is responsible for the network of the campus and for all of our technology; the chief financial officer, Mark Watters, who is with me today; and the chief human resources officer, Pierre Parent, who is the person in charge of staffing and all of the related human resources policies.
I said earlier that the Speaker and I have two distinct areas of responsibility. There is the parliamentary role and function, which is basically the part of the job that comes with a uniform, so I'm wearing it today because we'll be in the House this afternoon for question period. Then there is the administration role and function that we play, and that's, of course, of more interest to you here this morning. The Speaker is the chair of the Board of Internal Economy and I am its secretary. He oversees the administration, which I am directing, and he appears before this committee to defend the estimates. You have from time to time gotten into discussions with him on the study of main estimates and supplementary estimates.
So it's the same thing, the same division of labour for me. Time was when the Clerk of the House really spent much more time on procedural matters, but really most of my time now—I'd say 85%—is on administrative matters. I am very well supported by the six heads of service who are the experts in those various fields, but I do think it's particularly useful to have the Clerk as the secretary to the board and as the person responsible for administration overall, because I think the needs of a legislative assembly are different from the needs you might find in another public sector formation—an agency, a crown corporation, or a department—and certainly vastly different from the needs you would find in a corporate situation.
So as part of the Clerk's Management Group, I report directly to the Speaker and have regular meetings with him on various issues. The group, that is to say, the meeting of the six people, the heads of service on that bottom line of the organigram, is chaired by me. The chief of staff, Suzanne Verville, and the director of audit, Jennifer Wall, attend those meetings as observers. We make recommendations to the Speaker and the board regarding the administration of the House.
It's the CMG, Clerk's Management Group, that is responsible for setting strategic directions, priorities, and expected results for the House of Commons administration, for ensuring that we have the financial, material, and human resources necessary to carry out our mandate, which is to support members in their parliamentary functions, as well as to support the legislative body that is the House. It sets the direction for the development of policies for our own internal regulation. Of course, we ensure appropriate monitoring so that there is compliance with the approved policies and directives.
I should say, for example, that the performance audit of the Auditor General, which was done some two years ago—it took so long I sometimes forget, taking two years to do instead of one—looked at the structures and the systems that we had in place for ensuring compliance with the directives of the Board of Internal Economy. They were content with what they saw. They did make a few recommendations, which we have happily taken on board and acted upon. Basically, for us, it was a very helpful exercise.
When I mentioned earlier that the CMG, Clerk's Management Group, sets the administration's strategic objectives, maybe it's useful to just mention to you the following. Because members are elected in general elections on a regular basis—and in the Commonwealth, for instance, Canada has one of the higher turnovers of members in each election—it's inevitable that the job, the responsibility for carrying the institutional memory, rests more with the administration than it would in other circumstances. I know it is common for people to have a very long career at the House—not just to spend a certain amount of time at the House. So I feel, as the Clerk, and I know my predecessors felt the same, that we have a culture that has a very special responsibility for safeguarding the institution, the independence of the institution, and for ensuring that we are not only applying the highest standards of public sector governance, as we say in that fourth objective, in this parliamentary context, but that we're ready to respond to changing needs, because each Parliament is different.
The composition of this parliament, for example, which is more diverse and far younger than most of the previous parliaments, means we have to be ready to deal with the various challenges that come up there. We like to pride ourselves on the fact that we do that. We are very flexible and prepared to change, as I say, to respond to needs.
We also feel responsible for enhancing ongoing services, for instance, communication with citizens, communications with constituents. Now that people are using websites and other kinds of approaches, we are always looking very carefully at what tools we make available to members.
Finally, we want to promote greater understanding and support for the advancement of legislative institutions. In that respect, we are often asked by other jurisdictions to come to visit on studies. The U.K. people have come to look at how we are set up. We have a lot of visitors from the Commonwealth, and right now there's a study program that's in train for senior parliamentary officials
…from French-speaking countries who are there not only to share their experiences of governance in their legislative institutions, but also to learn how we meet the challenges. One of the most impressive things that emerged from these exchanges and studies is how similar the challenges an administration faces are, be it the Walloon parliament of Belgium, in Kenya, Senegal, Nunavut, British Columbia, Quebec or here, at the federal level in Canada. The context is particular because of the geography and culture, but the challenges are essentially the same. We're fascinated by that.
That is how I see the role of the Board of Internal Economy.
I'll turn things over to my colleague and friend, Mark G. Watters…
who is the chief financial officer. Then I'll come back for one final kick at the can and we'll be happy to take questions.
I should say that Mark is a career public servant, and I think of him as “my” but it really is “our” renaissance finance guy. He has extensive experience and came to us
…from the Department of Citizenship and Immigration two years ago.
He previously worked with a government agency, the Canada Council, and with
…the Public Service Alliance of Canada.
As well, he worked with the Office of the Auditor General. He really has a phenomenal breadth of experience. He's going to be addressing other aspects of your study.
Thank you very much, Mr. Chair.
I do have a statement that I will go through. We have copies that are available both in French and in English for members of the committee to consume, either during or afterwards.
Thank you very much for allowing me this opportunity today. I would like to share with the committee the results of our work in examining the governance structures of other jurisdictions and, in the first instance, our findings in provinces and territories in Canada.
I'd like to highlight three provinces where the regimes either are the most different or are thought to be the most different, starting with the Province of Manitoba.
In Manitoba, there are 57 members in the provincial legislature. In this area, a commissioner is appointed within six months following a general election. The mandate of the commissioner is to decide on the appropriate salaries, allowances, and retirement benefits for members of the Legislative Assembly of Manitoba and to make regulations for implementation and decide on the disclosure regime.
The Speaker is responsible for approving member expense claims and does so through the staff of what is called the Members' Allowances Office, the staff function, the MAO. Members may appeal any decision made by the MAO directly to the commissioner, whose decision is final.
Again within six months following an election, the director of the MAO prepares a compliance report, which describes any administrative or interpretative issues that have arisen in the administration of allowances and also verifies whether the amounts paid were in compliance with the Legislative Assembly Act and regulations. The report is then audited by the provincial Auditor General, who expresses an opinion, and both the report and the opinion are tabled by the Speaker in the Assembly and posted on the Web.
Moving to Nova Scotia, where 51 members make up the assembly, a body that is also called a commission has replaced the legislature's Internal Economy Board. The commission, however, is no more independent than the current governance of the House of Commons. Membership in the commission is similar to that of the Board of Internal Economy of the House.
Under this regime, the clerk administers members' expenses and members appeal decisions to the commission—essentially to the board. All members' expenses are disclosed. Twice yearly, individual member expense statements are publicly disclosed. On a monthly basis, data regarding member purchases is extracted from the financial system and posted on the legislature's website. It's really a dump from the financial system that's simply put on the website, so it's fairly difficult to comprehend.
In Newfoundland and Labrador, with 48 members part of that legislature, the governance body is also called a commission, the House of Assembly Management Commission. This commission is chaired by the Speaker, and the clerk is responsible for member expense administration.
The makeup of the commission is similar to that of the Board of Internal Economy, with representation from elected parties. Once every general assembly, an independent committee is established to inquire and report on salaries, allowances, severance payments, and pensions paid to members. All member expenses are disclosed. Again, similar to Nova Scotia, twice yearly an individual member expense statement is prepared, which summarizes expenses by category.
Mr. Chair, it's important to also appreciate the environment in which these three legislatures operate. The average number of sitting days for these is 63, 54, and 47 respectively. The House of Commons sits for 27 weeks, or 135 days, making the difference I believe significant. In addition, in terms of travel, our parliamentarians' travel is quite extensive and on the national scene. In 2012-13, members collectively used almost 12,300 points. This represents 12,300 round trips and the expense claims that go with those trips. The volume that the House of Commons deals with is impressive.
In terms of other provincial and territorial jurisdictions, all other jurisdictions have the equivalent of the House of Commons Board of Internal Economy. Most jurisdictions have some form of public reporting, and the frequency of reporting varies.
I wanted to highlight those three that were the most different or thought to be the most different.
In terms of other Westminster-style parliaments, the Clerk and I travelled to London to review the model adopted by the U.K. As members may be aware, the model in the U.K. is quite different and boasts an independent arm's-length agency for members' expenses. The reforms were adopted following the leak of an unredacted copy of an expense report for all parliamentarians. Journalists had begun to point out a large number of alleged abuses of allowances and expenses. There was, as you can imagine, significant political fallout, and the reforms were adopted. I'd like to summarize those for you this morning.
In the U.K., the model that's been adopted is that an independent body has been created to oversee and regulate members' expenses. The Independent Parliamentary Standards Authority, IPSA, as it's called, was created in 2009. The agency was created to address the member expense scandal. At the time, the House of Commons did not have a very rigorous finance function, and existing rules were not being enforced. There were internal proposals to increase transparency and compliance, but these could not be put in place in time once the political storm had been unleashed.
IPSA's main role is to regulate the expense system, which it does by determining the rules governing members' expenses, and to administer and pay members' expenses and their salaries. IPSA is governed by a board of five, one of whom is the chair. The appointments are ratified by the House of Commons. Candidates are selected for recommendation based on the principles of merit and fair and open competition. They are appointed for specific terms. Three of the four members must meet specific eligibility conditions. The agency has a chief executive officer and a professional staff.
Within the agency there is also a compliance officer role. In the original legislation it was defined as the commissioner for parliamentary investigations, but was subsequently amended to compliance officer. The compliance officer is appointed in a manner similar to the board of IPSA, and IPSA must provide resources to the compliance officer for the carrying out of the mandate.
The role of the compliance officer is to conduct investigations if the officer has reason to believe that a member may have been paid an amount that should not have been allowed under the allowance scheme. There are strict processes to follow regarding how investigations are conducted, as well as limitations on how investigations are launched.
The Speaker of the House has a committee for IPSA. The members of this committee are the Speaker; the leader of the House; the chair of the standards and privilege committee; five members who are not ministers, all appointed by the House; and three laypersons who are appointed by resolution of the House. The laypersons must also meet strict conditions prior to being appointed.
The role of the Speaker's committee for IPSA is twofold. It considers IPSA's appropriation and agrees on the Speaker's recommendation to the House for the appointment of the IPSA chair and board members. The Speaker still maintains other committees for the functioning of the administration of the House.
Implementing this model was quite difficult. It was done in great haste due to the environment. Members were generally dissatisfied with the new agency, saying that the service was poor and they were not better served. In fact, at the time of the election in 2010, members were out of pocket for a significant period of time as IPSA struggled to get off the ground.
IPSA had a significant credibility issue to overcome due to its poor response to members in a post-election period. The election unfortunately happened to be timed at the same time as the coming into force of the legislation and the creation of the agency. The compliance function is now, some three years later, just getting off the ground, post-enactment of the legislation.
It's clear that with the creation of this new agency the pendulum had swung to an extreme position. Some three years later, the middle ground is being found. A rigorous arm's-length relationship was forced with a strict independence mentality, which no doubt caused relationship issues to arise.
Today we note the existence of an informal liaison group between the House and IPSA that meets on a regular basis, is jointly chaired, and whose objective is to discuss and consult on potential changes to the allowance scheme, which is under the exclusive jurisdiction of IPSA, and to improve relations with members.
This is a large group, and from the House perspective it is quite diverse and representative of members according to geography, gender, age, family status, and other criteria.
Mr. Chair, I'll now address the issue of independence, transparency and accountability.
First, I would like to say that independence doesn't necessarily lead to transparency and accountability. It only leads to independence.
The House has made significant advances on transparency and accountability with respect to spending.
As the clerk mentioned earlier, I would like to remind the committee of the following initiatives: public disclosure of minutes of the Board of Internal Economy meetings, an annual audit of our financial statements, posting our financial results in the Public Accounts of Canada, posting the administrative by-laws of the House on the website, posting the Report to Canadians on the website, posting the Strategic Objectives on the website, annual publication of the members' expenditures reports with increased disclosure in recent years, a transition toward enhanced quarterly reporting on members' expenditures in the coming fiscal years, beginning April 1, 2014, the planned posting of the Members' Allowances and Services Manual on the website and the planned posting of the Public Registry of Designated Travellers on the website.
We could adopt the following measures to continue improving transparency and accountability through increased disclosure.
First, we could prepare and publish a quarterly financial report, possibly using the same format as the Public Accounts of Canada. The report would present credits for each program activity and line of income, like we do when the Main Estimates and Supplementary Estimates are presented here in committee.
Then, we have the modification of our program activity architecture in order to establish an improved report at a much more detailed activity level. Our activities are currently summarized in two categories: House of Commons members and officers, and House administration.
We could also look into a more detailed presentation of activities. We could even examine the members' annual expenditures reports before they are posted on the website.
Mr. Chair, the House has a robust finance function in place, says the CFO of the organization—
Some hon. members: Oh, oh!
Mr. Mark G. Watters: —you would hope.
Finance Services provides policy advice to the board, makes payments of members' claims after verifying compliance with policy and regulation, provides support and advice to members through training and communication initiatives directed towards members and their employees, provides access to financial tools, tracks all member expenses of public funds, and regularly discloses these according to the format that's approved by the board.
We have put in place a rigorous pre and post-payment verification process. The U.K. through IPSA is only now attempting to put in place such a regime.
If we review the following measures of performance indicators for the House finance function, we can appreciate the conditions under which this model is applied at the House: over 70,000 member payments on average in the fiscal year; 20,000 calls and e-mails received by Finance Services in a year; and 4,365 regret letters sent to members advising them of a modification to an amount claimed—some of you will be familiar with those letters and you probably typically don't like to receive them. But this is where we've made an adjustment to claims, and we advise you. We conveniently call them “regret letters”, rather than something else.
Only seven requests for exemption were made to the board in the fiscal year, and there were 11 situations raised with the Speaker that were dealt with directly without having to involve the Board of Internal Economy. Finally, 21 staff members were involved in the adjudication of member expense claims.
Despite complaints made by members of the requirements or services provided by Finance Services, members are generally supportive of the regime currently in place at the House. There have been numerous public comments made by members about the robustness of Finance Services at the House. In the most recent Office of the Auditor General report on the audit of the House administration, the AG indicated that the administration had in place appropriate policies and control systems to govern the proper expenditure of funds in accordance with the bylaws, policies, and directives of the board. The AG found no instances of significant non-compliance.
Our external auditors, KPMG, once again have issued a clean opinion on the financial statements prepared by the House administration. Further, they did not find any areas that needed to be addressed through a management letter as a result of their audit. That's probably as good as it gets in terms of audit-speak. In our view, the House can claim that it is transparent and accountable for the resources that are expended.
Mr. Chair, now turning to the independence issue, while the board is not an arm's-length agency, we have made significant inroads on the independence front as an institution. In terms of human resources, the finance function that is contained within the administration of the House is functioning well and is supported in its role by the Board of Internal Economy.
A high number of staff have professional designations and adhere to strong codes of ethics as a result of their memberships in these professional bodies.
Salaries for members are determined independently; they are not decided upon by the Board of Internal Economy. A formula contained in the Parliament of Canada Act, which ties increases to those achieved through collective bargaining in the private sector, assures this. Pension entitlements for members are debated in the House and administered by the Treasury Board with the assistance of the Chief Actuary of Canada.
If there were a desire to add an additional layer of independence in decision-making, external expertise could be added to the existing structure, as is often the case on corporate boards and audit committees. External advisers or independent directors supplement the existing structures to provide additional perspective on issues. The committee may wish to explore these models, which, in our view, could achieve the objective of independence while continuing to leverage the investments that have been made in the existing regime, which in our view is robust and sufficient.
Of course, such a model would avoid the duplication of committees that we find in the U.K.—you'll recall the Speaker's committee on IPSA, the Speaker's administration committees, and the informal House-IPSA liaison committee—and could be pursued without incurring significant additional cost and delays.
Mr. Chair, thank you for your patience. I would now like to return the podium to the Clerk for final comments.