Committee
Consult the user guide
For assistance, please contact us
Consult the user guide
For assistance, please contact us
Add search criteria
Results: 1 - 22 of 22
Nancy Cheng
View Nancy Cheng Profile
Nancy Cheng
2015-05-13 15:32
Expand
Thank you, Mr. Chair.
Thank you for this opportunity to discuss “Report 2, Required Reporting by Federal Organizations” of the Spring 2015 Reports of the Auditor General of Canada.
Joining me at the table are John Affleck, principal, and Colin Meredith, director, who were responsible for the audit.
This audit focused on recurring reporting requirements set out by the Treasury Board, by the Public Service Commission of Canada, and by statute. We undertook this audit to respond to long-standing concerns about the burden these reporting requirements create for federal departments, federal agencies, and crown corporations.
The overall objective of the audit was to determine whether selected reporting requirements for federal organizations efficiently support accountability and transparency, and generate information used for decision making in policy development and program management. Overall, we found that reporting intended to support accountability and transparency was serving its intended purposes.
We also found that clear purposes and timelines had been established for the selected reporting requirements, and that central agencies had provided guidance and support to help federal organizations meet them.
However, with respect to the efficiency of required reporting, we found that neither the Treasury Board of Canada Secretariat nor the Public Service Commission of Canada had determined the level of effort or costs involved in meeting the requirements we examined. ln our view, determining level of effort and costs would lead to a greater understanding of the resource implications of these requirements, and would allow them to be adjusted accordingly.
Furthermore, we found that the secretariat has not maintained a comprehensive inventory and schedule of the 60 recurring reporting requirements stemming from its policies, directives, and standards. Such a tool would both help the secretariat address the burden of Treasury Board reporting requirements and help reporting organizations efficiently prepare the required reports.
The secretariat made some accommodations for the sizes and mandates of reporting organizations when reporting requirements were first established and during subsequent reviews. However, we found that most Treasury Board 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 noted that the efficiency and value of quarterly financial reports could be improved to better support accountability to Parliament. We identified only one routine use of the information in quarterly financial reports. The Office of the Parliamentary Budget Officer used the information in preparing assessments of in-year spending for parliamentarians.
Six of the eight reports that we examined were intended to support accountability and transparency. We observed that federal organizations were preparing these six reports. However, they were not meeting the remaining two reporting requirements, which were intended to support their internal decision-making.
We noted that 20% of departmental investment plans had not been completed as required. We also found that about half of the departmental security plans that were due by June 2012 had not been finalized at the time of our audit. A departmental security plan is intended to support internal decision-making by providing an integrated view of an organization's security requirements.
In addition, we found that the secretariat did not take full advantage of the opportunity to use the information in the departmental security plans. For example, although the secretariat reviewed the plans it received and used them to support its policy review, it did not use the information to identify broader government security issues.
In the report, we made six recommendations aimed at improving the efficiency and usefulness of required reporting. The secretariat and the commission have agreed with our recommendations.
Mr. Chair, this concludes my opening remarks. We would be pleased to answer questions that this committee may have.
Thank you.
Collapse
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2013-11-21 11:24
Expand
I guess, Ms. Legault, what I am getting to is that, whether it's a question of more detailed reports coming from the Auditor General or of putting in a mandate under which they are doing these audits every three years, it actually complements that process to see forward movement on access to information, so that the two of them, hand in hand, can ensure more accountability and transparency.
Would you not agree to that?
Collapse
Suzanne Legault
View Suzanne Legault Profile
Suzanne Legault
2013-11-21 11:25
Expand
Yes.
If you conduct performance audits, you will have more accountability and transparency every third year for something that happened in years prior. That's the problem: you're basically looking at the past all the time, so that your accountability will be dealing with something that occurred in the past. It's something that is not available during election time; it is something that is not available during prorogation of Parliament. The House administration, the Senate administration, the Library of Parliament, all of these things continue to operate. They continue to enter into service contracts; they continue to spend money; they continue to manage people. All of these things deserve accountability and transparency. If you do something every third year, it's not sufficient.
Collapse
Audrey O'Brien
View Audrey O'Brien Profile
Audrey O'Brien
2013-11-21 11:58
Expand
Good morning, Mr. Chairman, honorables députés.
I am pleased to be here with Mark Watters as we return for what I believe will be the final session of hearing witnesses in your study on the Board of Internal Economy. I have followed your hearings with interest.
I found the comments and suggestions made by those who have appeared before the committee very informative. I won't give an opening statement, but I would like to make a few comments that, in my view, will help clarify certain situations that seem to be mired in confusion.
In the first instance, let me simply say that with regard to the salaries and pensions of MPs, the Board of Internal Economy has nothing whatsoever to do with that. The Parliament of Canada sets the annual basic remuneration for members and the additional remuneration for certain office holders. It's the Members of Parliament Retiring Allowances Act that sets pensions. So that's not in our remit.
Secondly, because this too seems to be a source of some confusion, the board has an equal representation of government and opposition members. It's chaired by the Speaker, who's elected by secret ballot by all members. It operates on the basis of consensus.
I've left with the clerk, and I think she has distributed to you, a report on the statistics on the views per page of the information on our website. That was a question I'd had. I have to warn you that these numbers are maybe a bit disappointing. Certainly they're far from overwhelming.
I'm sorry to say that I think it's the lack of direct experience with what is already posted that may lead people to the conclusion that there isn't very much information available or that they don't have sufficient information. Those kinds of comments I think tend to fuel mistrust of the Board of Internal Economy, mistrust of us as the House administration, and by extension, of course, mistrust of you yourselves, as MPs. On the contrary, I believe still, and I think the facts bear us out, that every dollar is accounted for and audited. I'd suggest that a great deal of information is already available. Now, more can be made available, and more is already in the works, but I certainly would urge people to become familiar with what is already on the website.
Another little point that Mr. Taylor-Vaisey from last night made was that it was not the entertainment value of the Board of Internal Economy that journalists were after, but rather the content.
I'm sorry if my facetiousness might have led to some confusion, but when I was talking about the “ordinariness” of the discussion, I was trying to dispel the idea that the Board of Internal Economy was a Star Chamber. I mean, I've always thought of the Star Chamber as rather intriguing, and wonderful. But because the board is constantly described as the “highly secretive” Board of Internal Economy, it tends to get a little atmosphere of Star Chamber about it when, to use a homely example, I think it more likely resembles a condominium board of directors, that sort of thing. That's just to set the record straight.
Finally, I was particularly interested, of course, as we all were, in the testimony of the Auditor General. As members know, the Auditor General's office conducted a performance audit of the House of Commons. The AG came in at the invitation of the board. In June 2010 that invitation was given, and the report was tabled in June 2012. It's a process that took almost two years—two years less a bit if we take it that the first summer was a bit of a lull.
That required us as the administration to devote many resources, in terms of time and people, to working with the Auditor General, which we were happy to do. The OAG made eight recommendations in the report, and the administration agreed with all of them. We've completed mitigating action on five of those, and the three others are well in progress.
I have to say, just as a small point of clarification, that not one of those recommendations had anything to do with the systems or procedures in place concerning the verification of members' entitlements, allowances, and services. I think that's an important point to realize.
That's it, Mr. Chairman. With my colleague Mark, I will be happy to answer questions.
Collapse
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2013-11-21 12:18
Expand
But of course, Mr. Chair.
We believe that Canadians have a right to know who's flying first class, to know if they choose first class, like your leader, or who's flying economy, like our leader is flying economy. These are things on which, at the very least, everyone within the Liberal caucus has taken a step forward through proactive disclosure.
When the member makes reference to “we want more, we want more”, it's a kind of childish game that they're entering into. You can have this, what we have today, and we can do what Madam O'Brien is suggesting in terms of having a rule that applies to all political parties and is administered by the government, as opposed to a political party. All we need is the consent of the New Democrats in order to make that happen.
My specific question is for you, Madam O'Brien. The Auditor General of Canada has provided performance audits on MPs' expenditures in the past. One of the suggestions is that we have that on a more regular basis, so that every three years there would be a performance audit conducted by the Auditor General. Do you feel that would be helpful?
Collapse
Audrey O'Brien
View Audrey O'Brien Profile
Audrey O'Brien
2013-11-21 12:20
Expand
If I may, Mr. Chairman, I have perhaps a slight clarification, in that the performance audit the Auditor General has done here is a performance audit of the administration, not of members. An audit of members by the Auditor General has been something that members have steadfastly resisted, because it is viewed as an interference in their carrying out of their parliamentary functions. That's never been done.
Collapse
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2013-11-21 12:20
Expand
Do you think there would be value in terms of having performance audits conducted, then, on the expenditures of members of Parliament?
Collapse
Audrey O'Brien
View Audrey O'Brien Profile
Audrey O'Brien
2013-11-21 12:20
Expand
Frankly speaking, I think, again, that because of the vast differences in the backgrounds of members, they operate in very different ways; the former Speaker spoke last night about people with extensive industry experience or professional experience and so forth, and people with relatively none all of a sudden coming into.... So I'm not sure that a performance audit in that sense would be all that helpful. I think there are ways in which some things could be made more helpful. Perhaps my colleague, who has auditing experience, can suggest some ways.
Collapse
Mark G. Watters
View Mark G. Watters Profile
Mark G. Watters
2013-11-21 12:21
Expand
I might suggest, Mr. Chair, that if you look at the mandate that was given to the Auditor General with respect to the audit of the House, it was to see how the House administration supports members in their functions. You can imagine, then, that a performance audit of a particular member would be how that member particularly supports the constituents that he or she represents. That would be the kind of focus of the audit within the existing rules. So when we talk about performance audit, that's what you would be buying if you asked the Auditor General to do that type of work.
Members serve their constituents in a very different fashion. From coast to coast, with small ridings, large ridings, there are very, very huge differences. Frankly, as a former assistant auditor general, I don't know how I would start to audit that or what criteria I would use to make that assessment. I think it would be quite difficult.
From an attest perspective, our financial statements, which include members' spending, are audited, and they're audited by a separate firm. They're audited by KPMG. But KPMG, being auditors in Canada, follow GAAS, which is generally accepted auditing standards, the same standards that would be followed by the Auditor General. The Auditor General would not bring a different vernacular to that attest audit, which is already done.
Collapse
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2013-11-19 11:21
Expand
Thank you, Mr. Chair.
Our New Democratic friend was starting to play a childish game. Maybe the NDP should just take the initiative and do what the Liberals and the Conservatives are saying, which is to move forward and say that we're prepared to provide proactive disclosure.
Anyway, it is about public trust. Politicians can only dream about having the type of public trust, Mr. Ferguson, that Canadians have in the Auditor General's office.
What I have found is that quite often when we find ourselves in trouble, because of the way affairs have been managed, one of the offices we always turn to is the Auditor General's office. Once again, in the last number of months, we find ourselves in a situation where we're turning to the Auditor General's office to get some assistance, some direction.
With respect to the idea that we need to undertake performance audits for the House of Commons administration, do you have any short thoughts you could share with us on performance audits, or the benefits of such audits?
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2013-11-19 11:22
Expand
Thank you, Mr. Chair.
In my opening statement, I identified three types of audits: financial audits, performance audits, and compliance audits. The first message is that not all audits are the same. That's important for everybody to understand.
As to a performance audit of the administration, that's what we did in 2012. We did an audit of the administration of the House and an audit of the administration of the Senate.
The purpose of these audits is to look at whether the administration is performing its function in an economical and efficient manner, looking at whether all of the support functions are operating the way they should.
Collapse
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2013-11-19 11:23
Expand
To the best of your knowledge, has that been the case? Has there been follow-through on that?
Collapse
Clyde MacLellan
View Clyde MacLellan Profile
Clyde MacLellan
2013-11-19 11:23
Expand
In relation to that question, we completed the audit. Typically, we allow a bit of time to pass before we do any type of follow-up. The unique relationships between the House and the Senate have operated on the basis of being invited back to take a look at particular issues. So in answer to your question, we have not followed up on those recommendations.
Collapse
View Kevin Lamoureux Profile
Lib. (MB)
View Kevin Lamoureux Profile
2013-11-19 11:24
Expand
That's right. So there's a need for us to invite you back.
Performing more detailed audits of parliamentary spending seems to be what Canadians are wanting to see. Do you feel this is something the Auditor General's office would be able to provide—looking at ways we could perform more detailed reporting of our expenditures? Do you believe this would help out in furthering accountability and transparency, Mr. Ferguson?
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2013-11-19 11:24
Expand
In terms of expenses themselves, I think there are a couple of different types of audits that could be undertaken. One would be a compliance audit, which would be the standard: did the claims comply with the rules and were they processed properly?
In terms of the question you're asking, that would be standing back and trying to do a broader audit of disclosure practices, making recommendations around those practices. It's certainly something that we could put an objective around and do an audit of. Usually in our performance audits we have to stay away from commenting directly on policy. We just look at how policy was implemented. In this instance, we would very much have to be given the mandate. If we were going to do that type of audit, it would have to include a mandate to be able to comment on policy. I'd have to make sure that we would be able to do that under our legislation, but that would be the thing we would need to consider.
Collapse
Ronnie Campbell
View Ronnie Campbell Profile
Ronnie Campbell
2013-02-28 15:32
Expand
Thank you, Mr. Chairman. I'm joined today by Glenn Wheeler and Nadine Cormier, who worked on this audit. With that I'll begin my opening statement.
Mr. Chair, thank you for this opportunity to discuss chapter 6, Transfer Payments to the Aerospace Sector—Industry Canada. Joining me at the table are Glenn Wheeler, Principal, and Nadine Cormier, Director, who were responsible for the audit.
The Government of Canada sees the aerospace sector as crucial to Canada's economic development, sovereignty, national security, and public safety. Since 2007, Industry Canada has managed two programs that provide repayable assistance to support industrial research and development in Canada's aerospace sector.
The strategic aerospace and defence initiative, SADI, is the federal government's second largest program of direct spending on research and development. Under this program the department has authorized assistance of just under $825 million since 2007. The program was created to support private sector industrial research and pre-competitive development in Canada's aerospace, defence, security, and space industries through repayable project contributions. At the time of our audit, the department managed repayable contribution agreements for 25 individual projects with recipients.
The Bombardier CSeries program is intended to encourage research and development that will result in the development of new commercial aircraft technologies. The department authorized assistance of $350 million to the Bombardier CSeries program in 2008. Industry Canada manages two repayable contribution agreements under this program.
Mr. Chairman, we examined whether Industry Canada had sufficient information to determine if the transfer payments were meeting the programs' objectives. We also looked at whether the department managed these programs according to the key requirements of the Treasury Board's policy on transfer payments as well as the terms and conditions of the programs. In addition, we examined whether Industry Canada collected repayments from recipients for contributions that are repayable under two previous transfer payment programs.
The work on this audit was completed in July 2012 and we have not audited actions taken by the department since then.
When funding for the Strategic Aerospace and Defence Initiative was approved in 2007, Industry Canada agreed to report publicly each year on contribution recipients as well as on program results and accomplishments. This reporting is in response to its commitment to set new standards for transparency following the end of its predecessor program in 2006—Technology Partnerships Canada.
We found that Industry Canada has yet to report publicly on the results of the Strategic Aerospace and Defence Initiative, as required by the funding approval it received in 2007. This means that both Parliament and Canadians do not know whether a program is meeting its objectives.
Before 2010, Industry Canada had inadequate performance information to determine progress being made to achieve the program's objectives. This information was needed to meet its requirement to report publicly each year on overall program results and accomplishments. Since 2010, the department has made improvements and now collects and consolidates sufficient information to allow it to determine progress against the program's objectives.
However, Industry Canada has delayed and cancelled some of its evaluation commitments, potentially missing out on early improvement opportunities. The department will need to follow through on commitments to collect additional performance information so that it can complete its planned evaluation of the program in 2016-17.
Similarly, the department needs to complete the final evaluation of technology partnerships Canada's longer term technological, economic, and societal outcomes. It may then be in a position to integrate lessons learned from this evaluation to potentially improve performance measurement for the strategic aerospace and defence initiative.
For the Bombardier CSeries program, Industry Canada has not collected all documents required by the two contribution agreements to determine progress toward the program's objectives. Therefore, it has a more limited picture of the program's performance. Again, this means that both Parliament and Canadians do not know whether the program is meeting its objectives.
Industry Canada has managed most aspects of these transfer payment programs appropriately, by using a reasonable control framework. For example, it reviews recipients' claims and progress reports before issuing payments. Also, the department funded only recipients that met program eligibility requirements. It also undertook a detailed review of proposed projects before signing contribution agreements with recipients.
In cases where contributions under two previous transfer payment programs—the defence industry productivity program and technology partnerships Canada—were repayable, the majority of repayments we examined were obtained by Industry Canada on time.
Industry Canada agreed with our recommendations and made commitments in its responses, several of which were to be implemented by the end of 2012. Mr. Chairman, the committee may wish to explore the progress made by the department to date in addressing our recommendations.
Mr. Chairman, this concludes my opening remarks. We would be pleased to answer the committee's questions.
Thank you.
Collapse
View Bryan Hayes Profile
CPC (ON)
View Bryan Hayes Profile
2013-02-28 16:33
Expand
Thank you, Mr. Chair.
It strikes me that it doesn't really matter if benchmarks are being met if the company you're dealing with goes out of business. I'm looking at the sizes of these distributions: $9.6 million, $52 million, and $19.6 million. We're talking huge money here. As a taxpayer, I would want some level of comfort that the company I'm dealing with is going to be around for the foreseeable future.
I took the opportunity to look at your website. It's a very good and comprehensive website. There's a section on due diligence review. Could you speak a bit on that? As a CGA, I'm more interested in the financial information you look at as part of your assessment of doing business with a company. I'm interested in the capabilities of your staff and the number of staff involved in the due diligence process.
Collapse
Mitch Davies
View Mitch Davies Profile
Mitch Davies
2013-02-28 16:34
Expand
Thank you for the question, Mr. Chair.
The due diligence that's undertaken speaks to the reason it takes us a number of months to complete the review of an application. We will undertake a significant amount of work in a number of areas.
First, we look at the technology that the company is undertaking to work on, and often we will consult experts. The National Research Council is used for its expertise in aerospace in particular. We'll go to other departments if they have a scientific competence in an area and bring in information in that regard.
Second, we'll undertake to look at the market assessments the company has prepared and to validate those. We will work in the department to confirm information against other industry analyst reports, against reports prepared for public markets and such.
Then of course the financial due diligence is extensive. We will undertake a complete review of the company's financial health, because essentially that's the entity that takes on the obligation to return the funds to the crown under the agreement.
Speaking specifically—though I won't name the gentleman—the person who heads up the team we have which undertakes the financial analysis is the person who actually goes and scores the CFA exam in the United States for the best financial analysts who are put into industry. He's the one who marks their papers. So I actually have quite a bit of confidence that we have a team with a number of designations in different areas as well as strong financial analysis and financial review.
On the repayments side, we also undertake modelling. Not only do we take company information that they supply in terms of their outlook and repayments to us, but we'll also subject that to a number of tests. We do Monte Carlo simulations which is a probabilistic model to determine whether, based on past information, we'll expect to have the result we expect. We use that to evaluate whether or not we're going to meet our portfolio objectives.
Much of this says there's a lot done. There are a lot of belts and suspenders. There's a lot of review done, but it's still done with risk. You can work as hard as you can, but you can't take the risk away when you're in a business space that's R and D. So we still have to live with particular risk. We'll adjust the repayment expectation from each company based on the risk assessed. For example, if it's a higher risk company, we'll expect a higher repayment, which is a way of compensating for that in the program. For a lower risk company, there is a lower repayment cap on their contribution agreement. That's essentially how it comes together.
Collapse
View Gerry Byrne Profile
Lib. (NL)
We've had an opportunity to go through the Auditor General's reports, so why don't we go right to you, Mr. Campbell, as assistant auditor general, and ask you, are you satisfied that the taxpayer dollar has been protected, or have the contribution agreements with industry, signed by Industry Canada, been satisfactorily achieved or enacted?
Collapse
Ronnie Campbell
View Ronnie Campbell Profile
Ronnie Campbell
2013-02-28 16:43
Expand
Thank you, Mr. Chairman.
Following from the discussion that has just happened, I mean, certainly there were areas that were not satisfied. There were reports that were required that have not been received, and the department, rather than follow up with the companies, told us that they found other sources of the information. Yes, they've done the site visits, and we noted that by and large I think they had done them all, but we noted that those weren't well documented at all, and that sort of thing.
There are a lot of areas there. I'm referring particularly to paragraph 6.31 and the Bombardier CSeries and other comments where we think that could be improved.
Collapse
View John Williamson Profile
CPC (NB)
Okay. That's good. I'm going to come back to you. I want to speak to the assistant auditor general.
I'm concerned with your review of the old programs, TPC and DIPP, particularly the line in section 6.80, “We found that, of the repayments we reviewed as part of our audit, the Department obtained most repayments on time.”
I'd like a very quick answer. This wasn't a value for money audit. It was looking at procedures, I suppose, and how the program worked. Is that right?
Collapse
Results: 1 - 22 of 22

Export As: XML CSV RSS

For more data options, please see Open Data