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Results: 1 - 22 of 22
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2015-04-29 15:32
Thank you.
Mr. Chair, I'm pleased to present our Spring 2015 Reports, which were tabled in the House of Commons yesterday.
I'm accompanied by Nancy Cheng, assistant auditor general; Joe Martire and Frank Barrett, principals; and André Côté, director.
We have presented seven audits that we completed since last fall. Some of the audits included in our Spring Reports were led by assistant auditors general Ronnie Campbell and Wendy Loschiuk, both of whom retired this past month. I want to take this opportunity to thank them for their contribution to the office. I would also like to acknowledge the contribution to the performance audit practice of Neil Maxwell, assistant auditor general, who will retire in June.
As you will see, some of the audits that we are talking about today highlight government activities that are not delivering their intended results for Canadians, and where there's a risk that the underlying issues could get worse if they're not addressed quickly.
First, let's look at our audit of antimicrobial resistance. Data shows that some drug-resistant infections are on the rise in Canada. Already, in hospitals alone about 18,000 Canadians contract resistant infections every year. We found that Health Canada and the Public Health Agency of Canada have not done enough to help contain the proliferation of drug-resistant organisms. Health Canada has not taken some important steps to protect the effectiveness of antimicrobials used for treating serious infections in humans.
Though the department requires a prescription for the human use of these drugs, prescriptions are not always required for their use in food animals. The imprudent use of antimicrobials in food animals can lead to the spread of drug-resistant organisms through the food chain. Health Canada is aware that there are gaps in the regulations that make it possible for farmers to import unlicensed antimicrobial drugs and active pharmaceutical ingredients for use in their own animals, but the department has not acted to strengthen the control over their importation.
We also found that the Public Health Agency of Canada is not collecting all of the surveillance information needed to understand the scope of antimicrobial resistance in Canada. In 1997, the federal government first articulated the need for a pan-Canadian strategy to address antimicrobial resistance. This was reiterated in 2009 and the agency acknowledged that stronger leadership was needed. However, there was no provincial or territorial consensus on what the Public Health Agency of Canada's role should be. There is currently no national strategy in place and in our view it will likely be many years before there is one.
Continuing on the topic of health, we also looked at what Health Canada has done to support first nations' access to health services in remote communities.
Health Canada has an objective of providing first nations individuals living in remote communities with access to health services that is comparable to that provided to other provincial residents living in similar locations. We found that the department has not achieved this objective.
In most cases, access to health care in these communities is initially provided through nurses deployed in nursing stations. We found deficiencies in the way nursing staff and stations are managed. For example, only one of 45 nurses included in our sample has completed all of Health Canada's mandatory training courses.
We also found that Health Canada had not addressed 26 of 30 health and safety or building code deficiencies present in the eight nursing stations we examined. Deficiencies ranged from malfunctioning heating and cooling systems to unsafe stairways, ramps, and doors. Health specialists cancelled visits to one community because they could not stay in the residence intended for their use due to issues with the septic system dating back more than two years.
In another audit we focused on whether the Canada Border Services Agency has managed its information technology investments to ensure its projects meet their objectives. The agency's current portfolio is made up of 30 information technology projects, with a budget of more than $1 billion.
In December 2013, the Canada Border Services Agency put in place a portfolio approach to strengthen the management of its information technology investments. We found this approach was comprehensive; however, a review of five projects against the new framework showed it was not being fully applied. For example, the information provided to senior committees tasked with overseeing the information technology project portfolio did not contain accurate financial information, project status information, or timelines. As a result, the agency faces significant challenges in managing these projects, sometimes resulting in duplication of effort or projects being delivered late.
Let's turn to our audit of tax-based expenditures. The total of tax-based expenditures accounts for billions of dollars annually. These expenditures are similar to direct program spending, we found that less information is provided to Parliament about tax-based expenditures than about direct program spending.
We found that Finance Canada does a good job of analyzing new tax measures and of monitoring existing ones. However, Finance Canada does not systematically evaluate tax-based expenditures to ensure that they continue to achieve the intended results.
We believe that Parliament needs comprehensive and consolidated information about tax-based expenditures to understand not only total government spending, but also what money spent through the tax system is accomplishing.
In our audit focusing on how the Correctional Service of Canada prepares non-aboriginal male offenders for safe re-entry into the community, we found that offenders are seeing more of their sentences in custody and spending less time under supervision in the community.
In 2013-14, about 1,500 offenders were released directly into the community from medium or maximum security penitentiaries without the full benefit of a gradual re-entry into society. Eighty per cent of offenders were incarcerated beyond the time that they first became eligible for parole even though many were considered to be at low risk to reoffend. We also found that in many cases offenders were not receiving correctional and rehabilitation programs prior to becoming eligible for release. Many offenders were not assigned to these programs while in custody, despite having histories of criminal associations or substance abuse.
Let's turn our attention to our audit focusing on the recurring reports that are required of federal organizations by the Treasury Board of Canada Secretariat, the Public Service Commission, or legislation. We found that, for the most part, reporting intended to support accountability, and transparency was serving its intended purposes. However, in our view, the efficiency and value of government reporting should be improved.
We also found that some Treasury Board of Canada Secretariat reporting requirements applied equally to all organizations, regardless of their size or mandate. For example, the Canadian Polar Commission—a small organization with 11 staff members—was required to prepare 25 annual or quarterly reports.
We also found that about half of departmental security plans, which were due by June 2012, had not been finalized at the time of our audit.
Our audit of the Office of the Ombudsman for the Department of National Defence and the Canadian Forces covered the period of February 2009 to August 2014, coinciding with the terms of two different ombudsmen. We found that, during the tenure of the first of these two ombudsmen, the office had in place inadequate controls for managing finances, contracts and human resources in compliance with government rules and policies.
In addition, existing controls were often overridden by management.
We also found that the first of the two ombudsmen and some senior managers did not respect the Values and Ethics Code. This resulted in grievances, complaints and high levels of sick leave and turnover. These issues, combined with a lack of standard procedures contributed to delays in processing investigations. After 2012, the workplace environment stabilized, and efforts to close long-standing files were successful.
National Defence's monitoring was insufficient to ensure that government rules and policies were being followed in the ombudsman's office, and the department did not fully address employee complaints about workplace issues filed from 2009 to 2013.
Since the ombudsman's office investigations are carried out independently from National Defence, but the office staff and budget reside with the department, the organizational relationship with National Defence is a complex one that needs to be better defined to ensure adequate monitoring in all areas.
In 2014, our office performed special examinations of the Canada Lands Company Limited and the Royal Canadian Mint. Though we did not identify any significant deficiencies, we did note some areas of concern relating to the Royal Canadian Mint's contracting practices and management of travel and hospitality expenses.
Of the seven audits we have reported on, some highlight government activities that are not delivering their intended results for Canadians, and there is a risk that the results could get worse. The national strategy to address antimicrobial resistance is one example. Almost 20 years after the government identified antimicrobial resistance to be a public health priority, there is still no national strategy in place.
Our audit of the Correctional Service of Canada is another example where it is evident that fewer offenders are getting the benefit of a full gradual release back into society.
We're concerned that the issues we're seeing today may be the symptoms of bigger problems in the future if they're not resolved quickly. It's important for departments to focus on addressing these issues promptly to avoid bigger problems, which will cost more to fix down the road in time, money, and effort.
Mr. Chair, that concludes my opening statement.
We will be happy to answer any questions you may have.
Thank you.
View Ted Falk Profile
CPC (MB)
View Ted Falk Profile
2015-04-29 16:35
Okay, very good.
From the Royal Canadian Mint aspect of that special examination, it says in paragraph 2 that there are “many elements of a good governance framework that meets the expectations of best practices in board stewardship, shareholder relations, and communications with the public”, all of those things. Yet one of the notes in the report is that you're a little concerned about the issue of travel and hospitality.
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2015-04-29 16:35
Yes, and again, in terms of their overall framework for governance, we found they had many of those things in place. But we did have concerns about the way they were managing some of the travel and hospitality activities.
I can ask Ms. Cheng to give you a bit more information in terms of that corporate governance, since she was involved in that special examination.
Nancy Cheng
View Nancy Cheng Profile
Nancy Cheng
2015-04-29 16:36
Thank you, Mr. Chair.
In terms of the governance front, it is important that they have strong leadership, that they provide the oversight and that they challenge the corporation in terms of its strategic thinking.
In terms of the special examination, at the time we had talked to all the board members to get an understanding as to the kind of information they received, and they asked for the information that they needed to actually exercise their oversight duty. In the course of looking at the Mint, you can see there are challenges with respect to management's positions.
In addition to that, one of the strategic areas they were considering has to do with foreign business. The Mint is actually very profitable and has—
View Scott Brison Profile
Lib. (NS)
We understand that the fiscal impact of this measure on the federal government is neutral. Is there a monetary impact on the Mint, or an impact on the Mint itself as an operation?
Elisha Ram
View Elisha Ram Profile
Elisha Ram
2014-11-05 16:40
If the proposal goes forward, the Mint will not be able to charge a profit on domestic coinage or on other goods and services that it sells to the government. So, yes, the Mint's net profit from those business lines will decline; however, it will continue to be able to make a profit on its other business lines.
Elisha Ram
View Elisha Ram Profile
Elisha Ram
2014-11-05 16:40
In the sense that it will have less profit overall than it has had in the past, yes.
Elisha Ram
View Elisha Ram Profile
Elisha Ram
2014-11-05 16:40
It's difficult to quantify, because the Mint produces different amounts of coin in any given year, and the value of the numismatic business lines changes over time, so it's something that we will have to negotiate with the Mint by re-negotiating the memorandum of understanding that they have with the government in order to fully understand exactly what this means to the bottom line.
Elisha Ram
View Elisha Ram Profile
Elisha Ram
2014-11-05 16:40
The Mint's profit for 2013 after taxes was about $36 million. A significant portion of that has traditionally come from the domestic circulation coin business. Traditionally, this has been the Mint's largest source of profit. However, with the growth of its numismatic business, that was already projected to change. It was expected that the numismatic business was going to overtake domestic circulation as a source of profit. Our sense is that this is not going to be a huge problem for the Mint.
Robert Currie
View Robert Currie Profile
Robert Currie
2012-11-06 12:12
Thank you very much. I was delighted to receive the invitation to appear before the committee here in Halifax. I'm at a bit of a disadvantage. I'd understood I was to speak for half an hour and then you might cross-examine me for awhile. As the old joke goes, I wrote a long talk because I didn't have time to write a short one, but let me offer this much.
Today I want to speak to the committee on one aspect of our current trademark law that stifles innovation and distorts the market, and that's the use of what are called official marks, which is a kind of hyped-up trademark regime that allows public authorities to reach into the market and exert nearly impenetrable control over words and phrases and things. It has been called a super trademark, and there's a reason for that.
To a limited extent, this is a good thing. There was good public policy behind the idea of official marks when they were originally brought in. It was in no small part to protect important national government symbols, coats of arms, flags, and that sort of thing from being used by commercial entities to bump up the perception of their product by falsely associating themselves with the state.
There are situations where we need the government to protect the dignity of our national symbols, but as we all know, especially after Hallowe'en, too much of a good thing can give you indigestion, and the Canadian public has long been getting indigestion from time to time arising from the over-broad use of official marks. Public authorities have sometimes used these marks not for public purposes exclusively, but to generate commercial revenue at the unnecessary expense of taxpayers and at the unnecessary expense of small business people.
This problem has been illustrated most starkly by two disputes over the last five years, one that took place in 2007 and one that took place earlier this fall. Both of these disputes involved the Canadian Mint and its official marks over various images of our currency.
In 2007 the City of Toronto, you may recall, embarked on a campaign called One Cent Now. The One Cent Now campaign was to have the federal government remit 1¢ of each GST dollar to municipalities. As part of the campaign, the city used the image of the penny and the phrase “One Cent Now”. They used it in their promotional material, bumper stickers, and posters. They also used it in their email address and in the address of a website that was used to promote the campaign.
They got a bill from the Mint for $47,000 for the use of the phrase “One Cent Now”: $10,000 for using it in paper materials, $10,000 for using it in Internet materials, and $27,000 for using the image of the penny in the promotional materials. The taxpayers in Toronto were unhappy. This got a lot of press, and the dispute was eventually dropped between the Mint and the City of Toronto.
Earlier this year, in fact, just about a month ago now, a Nova Scotian songwriter named Dave Gunning put out a CD called No More Pennies. On this CD, Mr. Gunning was reflecting on the impending death of the penny and giving the folksinger's take on that. The Mint sent Mr. Gunning a licence fee bill, in particular, for his image of the penny because he had an image of the penny like a setting sun on the back of his CD. It was something like a $1,200 bill levied on about 1,000 CDs. CDs are a very low yield product to begin with.
Mr. Gunning managed to convince the Mint to waive the royalty, perhaps coincidentally after there was significant media interest and clear public disgust at what was perceived to be exploitation of this small business person by his government.
Members of the committee, I'm adding my voice to a call that, in fact, is now decades old, if you read the literature, and which was raised in a white paper that the Government of Canada published in 1991. That call is to either abolish or to amend and significantly restrict the scope of item 9(1)(n)(iii) of the Trade-Marks Act, because this is where the authority for official marks comes from.
This is intellectual property law that breeds cynicism among the people of Canada. It's in no small part because it is so expensive to litigate and challenge any public authority that is using the official mark in an overbroad manner. As I said earlier, this is something that potentially distorts the market. The cost of litigation is particularly relevant in a time when we are faced with a crisis in access to justice and where an all-star legal committee, chaired by Justice Tom Cromwell of the Supreme Court of Canada, is trying to resolve the very real problems that result from access to justice. This is one of those, but it's part of a larger tapestry.
This is a law reform measure that I believe is significantly overdue, and I'd be happy to discuss it further with the committee in the question time.
Patrick Hadsipantelis
View Patrick Hadsipantelis Profile
Patrick Hadsipantelis
2012-01-31 11:53
Thank you, Mr. Chair. I'll try to keep to our time.
I would like to start by thanking the chair and the honourable members of the Standing Committee on Canadian Heritage for inviting the Royal Canadian Mint to present the commemorative coin programs and the implications of these activities on Canada's 150th anniversary in 2017.
I believe the work that the mint has done to celebrate Canada's greatest moments and icons, while meeting its primary obligation to produce and distribute circulation coinage to support Canadian commerce, speaks volumes about our commitment in supporting our national celebrations and milestones.
In addition to serving a transactional purpose, coins are also a medium for projecting a nation's pride to its citizens and to the outside world. The mint is proud to have followed this tradition by capturing the many different aspects of Canada: its people, places, and passions. We are even more proud to be doing so while generating robust profits and returning healthy dividends to our sole shareholder, the Government of Canada.
Before I get into the business of commemoration at the mint, I would like to offer a very brief overview of our diversified business. Operating as a self-financing crown corporation since 1969, the Mint is primarily responsible for producing and distributing Canada's circulation coins. But in addition to housing our Canadian circulation business line, our state-of-the-art facility in Winnipeg, Manitoba, produces circulation coins for foreign countries. Over the past 30 years, we have produced coins for over 70 countries, from New Zealand to Panama to the United Arab Emirates, thanks to our reputation for innovation, high-quality standards, and delivery. Our customers rely on us because the quality and technology that goes into all of our coins assures them that their national symbols will endure and resonate with their citizens for years to come.
Our bullion and refinery business has been a dominant part of our Ottawa operations lately, as worldwide demand for gold and silver continues to rise in tandem with uncertainty over the future of the global economy. Our bullion coins are sold and sought worldwide under the universally recognized Maple Leaf bullion brand. We have consistently led our industry by being the first to refine gold to 99.99% purity, which we call “four nines” purity, in 1982, and we surpassed that with 99.999% purity, “five nines”, in 1998.
We took an even greater step in that direction last November by launching an innovative product called “exchange traded receipts” under the Canadian gold reserves program on the Toronto Stock Exchange, which allows individual investors to directly own title to physical gold stored at the mint. By the first day of trading, $600 million had been raised in what became one of Canada's largest IPOs in 2011.
We're also proud of what we've achieved in our numismatics business line, which produces what are more commonly known as collector coins and medals, the most prominent of which are numerous Canadian military honours, the Queen's diamond jubilee, and more recently the Rick Hansen relay medal.
These coins and medals are important vehicles by which the mint celebrates a tremendous diversity of Canadian themes. We bring the story of Canada to life through coins featuring innovative technologies such as lasering, laser etching, and holograms, ranging in scale from half a gram to 10 kilograms, as was the case with the pure gold coin to celebrate Bill Reid's iconic sculpture The Spirit of Haida Gwaii. We are very proud to have produced a long line of coins celebrating first nations art with names like Alex Janvier, Jody Broomfield, and Corinne Hunt. Our collector coins are avidly sought by collectors and consumers in Canada and around the world, and they represent a very fast-growing part of our business.
Commemoration and celebration are also a part of the core responsibilities which we have proudly fulfilled since 1935, when the first silver dollar bearing the iconic Voyageur image was issued in honour of King George the V, who was Canada's sovereign.
As we speak, the Mint is promoting an ambitious array of collector coins for the Diamond Jubilee of Queen Elizabeth II. Just two weeks ago, we were also proud to take our first step in joining the national celebration of the 200th anniversary of the War of 1812 by unveiling a new Proof Silver Dollar dedicated to this historic conflict with the assistance of the minister responsible for the Mint, the Honourable Jim Flaherty.
Many annual silver dollar issues have followed since 1935, but it can be argued that the first true program was the commemorative circulation coin series issued for Canada's centennial in 1967. Every circulating denomination was given a new, iconic animal design, created by the hand of legendary Canadian artist Alex Colville. Redesigned only for Canada's centennial year, over 600 million of these coins circulated and were avidly collected by millions of Canadians.
Public opinion research indicates that Canada's Centennial was one of our most treasured national celebrations and our coins have been cited as one of the most remembered legacies of that milestone.
From 1973 to 1976, the Mint issued its most ambitious collector coin program yet, with an unprecedented series of $5 and $10 silver coins, celebrating the majesty of the Games and a powerful symbol of Canada's coming of age.
In 1992, the Mint introduced a new series of 25¢ circulation coins to celebrate the 125th anniversary of Confederation. For the first time in our history, the Mint involved the public, including children, in the coin design process by launching a national competition, inviting amateur and professional artists to create 12 new commemorative coins, one for each Canadian province and territory at the time. Some 11,000 drawings were presented to a panel of artists, public figures and citizens from across the country, resulting in 12 distinct portraits of Canada, icons of our broad and diverse landscape.
The Mint's aim has always been to inspire Canadians, to help them treasure their history, culture and values, and to make them feel proud to be Canadian. The Millennium was not only a turning point for Canada, but for the Mint as well.
Once again, we invited the public, including children, through the Millennium Coin Design Contest, to submit designs for 24 Millennium 25¢ circulation coins; one for each month of 1999 and 2000.
Public reaction to being given a voice in commemorating a national event was extremely positive, with 66,000 drawings received in response to this coin design contest. Again, our market research continues to tell us that this initiative ranks as one of our most memorable programs.
Since 2004, when we issued the world's first coloured circulation coin with the 25¢ Poppy and another 25¢ coin celebrating the 400th anniversary of the first settlement in North America, in Acadie, the Mint decided to issue commemorative circulation coins annually.
In addition to two other Poppy coins in 2008 and 2010, this gave us themes such as: “Lucky Loonies” for every summer and winter Olympic and Paralympic Games since the legendary Salt Lake City Games of 2002; the Centennial of Saskatchewan and Alberta, where the public was invited for the first time to vote online for the winning designs of these two coins; the Pink Ribbon campaign; Quebec City's 400th anniversary; the centennials of the Montreal Canadiens and the Saskatchewan Roughriders; and from 2007 to 2010, we produced 17 coins for the Vancouver 2010 Winter Games. Public online voting was also reintroduced to select the final themes that appeared on our 25¢ coins, celebrating the Top Three Moments in Canadian Winter Games history.
Recently, we celebrated the centennial of Parks Canada on a commemorative $1-dollar coin and we are continuing to release our 5-coin circulation series celebrating our legendary nature.
Every new commemorative circulation coin is promoted through varying combinations of print, television and online advertising. Additionally, the Mint is an avid user of social media to reach new audiences. I encourage you to take a look at our Twitter and Facebook pages where our followers are growing daily.
Every new coin issued by the Mint gives us an opportunity to strike a chord with the general public and provoke some reflection about what Canada means to them. Our experience with the Vancouver 2010 Winter Olympic Games was a pleasant revelation for us in terms of our products' potential for creating public engagement.
We opened pavilions in downtown Vancouver for both the Olympic and Paralympic winter games, and the reaction of the public and visitors completely exceeded our expectations. The Vancouver 2010 athlete medals and all our signature products were on display for 150,000 visitors at our pavilions during the games. Both of our exhibit spaces were totally accessible to the mobility-impaired, and we were especially pleased to easily welcome a great number of handicapped visitors during the Paralympic Games.
One tried and true way to reach out to Canadians and get new circulation coins into their hands is to hold public coin exchanges at which people come to an event venue to trade their loose change for new commemorative coins at face value. In this way more than 600,000 Vancouver 2010 circulation coins were exchanged with the public during the winter games.
We made such an impression in Vancouver that we decided to open our third boutique there in early 2011. We're still there today retailing our products and using our new store as a springboard for numerous coin exchanges and local outreach initiatives. Just last week we put on a very successful program of activities to support Vancouver's celebration of the year of the dragon, and we are very proud to be part of the community in Vancouver.
We routinely visit different regions of the country to take Canada's Mint to its people, from Baddeck, Nova Scotia, for the centennial of powered flight in Canada, to Moose Jaw, Saskatchewan, for the celebrated Saskatchewan Roughriders centennial. We also value the partnerships we have with other federal departments, agencies, and organizations, such as we had with Parks Canada for its centennial last year or with the Royal Canadian Legion whenever a new poppy coin is launched. We also act as members of the interdepartmental commemoration committee and its multiple working groups. We value opportunities to join events and celebrations around the country, and that's what we intend to do on the road to Canada's 150th in 2017.
We continue to research themes and subjects that matter to Canadians and continue to tell the story of our great country one coin at a time. We also track the retention rate of our new commemorative coins to determine the extent to which Canadians are collecting these coins, and the results are extremely positive. We estimate that about two-thirds of the special commemorative coins we've issued since 2004 have been saved by Canadians.
We look forward to working with our colleagues in various federal departments to bring out the best of Canada to its citizens and to leave the lasting impression that our natural, historic, and cultural heritage deserves.
It will now be my pleasure to take the committee's questions.
Thank you.
View Scott Armstrong Profile
CPC (NS)
Thank you, Mr. Chair.
I want to thank you all for your presentations. I found them very interesting.
First, Mr. Hadsipantelis, I saw that in 2010 the Mint had an income of about $2.2 billion. Was that higher than usual because of the Olympics, or is that roughly what you usually take in?
Beverley Lepine
View Beverley Lepine Profile
Beverley Lepine
2012-01-31 12:23
Thank you.
Certainly the Olympics did contribute to it, but it was not the largest part of it. As Patrick described, the four business lines contributed significantly to that number.
We have had an increase, certainly in profitability and business line operating profit, of about 200% over the last five years, so there has been a continuous growth in terms of the four business lines.
View Parm Gill Profile
CPC (ON)
Thank you, Mr. Chair, and I want to thank the witnesses for coming out.
My first question is for the Royal Canadian Mint. You had a great physical presence in Vancouver for the 2010 Olympics. Do you have something similar planned for the 150th celebration across the country?
Patrick Hadsipantelis
View Patrick Hadsipantelis Profile
Patrick Hadsipantelis
2012-01-31 12:48
The answer to that is not yet. We're currently looking at our retail distribution strategy. We've earmarked a few cities where we intend to make some inroads. It's a balance also of making sure that the investment we put in place makes sense for us as a crown corporation with a for-profit mandate. But it's high on our radar currently to look at how we can actually make the Mint more accessible to Canadians, and being in their communities we think is a key piece to that success.
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