Committee
Consult the user guide
For assistance, please contact us
Consult the user guide
For assistance, please contact us
Add search criteria
Results: 1 - 33 of 33
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
Jerome Berthelette
View Jerome Berthelette Profile
Jerome Berthelette
2015-03-30 15:35
Expand
Thank you, Mr. Chair.
I thank the committee for giving us this opportunity to discuss chapter 5 of our report, entitled “Support to the Automotive Sector”. It is in our 2014 Fall Report. Joining me at the table is Richard Domingue, Principal, who was responsible for the audit.
The global economic recession of 2008 negatively affected Canada's production and employment in the automotive industry. Vehicle sales declined sharply in the United States and Canada, and some companies, including Chrysler and General Motors, could not generate sufficient income to fund their operations.
In December 2008, the governments of Canada and Ontario joined the U.S. government and offered financial assistance to Chrysler Canada and GM Canada. In total, the federal government provided $9 billion of financial assistance to support the restructuring of Chrysler and GM, including their Canadian subsidiaries.
We looked at how Industry Canada, the Department of Finance Canada, and Export Development Canada managed this financial assistance. The assistance involved complex transactions, high uncertainty, and tight timeframes. These circumstances had an impact on what Industry Canada could do to manage the assistance.
We found that Industry Canada, the Department of Finance Canada, and Export Development Canada managed the financial support to the automotive sector in a way that contributed to the viability of the companies and the competitiveness of the sector in Canada over the short and medium terms.
Industry Canada adequately assessed the recovery prospects of Chrysler and GM. This helped the government decide whether to participate in the financing of the companies' restructuring. However, Industry Canada had limited information on required concessions from unionized labour and other stakeholders, and on GM Canada's pension liabilities. This lack of information made it difficult for the department to understand the impact of its assistance on the long-term viability of the companies.
Industry Canada's information on the use of funds was limited to broad categories. For example, Industry Canada had limited documentation on the actual use of a $2.8-billion loan made to GM Canada for capital expenditures, warranty claims, and other general corporate purposes. However, the department adequately monitored the companies' production commitments in Canada.
Mr. Chair, we also found that there was no comprehensive reporting to Parliament of information about the restructuring assistance. Based on the information publicly available, we found it impossible to gain a complete picture of the assistance provided and of the amounts recovered and lost.
In 2008, the federal government launched the automotive innovation fund program. The program's objective is to support automotive firms in their strategic, large-scale research and development projects to produce innovative, greener, and more fuel-efficient vehicles. In addition, the government expects the program to contribute to a more competitive Canadian automotive sector.
We looked at how Industry Canada managed this program. Overall we found that Industry Canada's assessment of each project proposal was consistent with the program's terms and conditions, but in our opinion its risk assessment framework was more comprehensive than required. The department could streamline its risk analysis, given that recipients assume all of the technical risks and most of the financial risks of their projects.
Industry Canada has adequate information coming from progress reports and site visits to allow the progress of each project to be tracked.
However, Industry Canada has not yet used this information to determine whether the program is achieving its objectives.
Industry Canada has agreed with our recommendations and set deadlines for their implementation. Last December the department met one of its deadlines by issuing a report entitled “Summary Report on Canada's Support for the Restructuring of General Motors and Chrysler in 2009”.
Mr. Chair, this concludes my opening remarks. We would be pleased to answer any questions the committee may have.
Thank you.
Collapse
View Stephen Woodworth Profile
CPC (ON)
Thank you very much, Mr. Chair, and thank you to Mr. Ferguson and Ms. Sachs for attending today. It's always extremely interesting. I want to again commend you on the necessary and good-serving function you provide in allowing government to continuously update its processes.
I want to begin with some things that are probably obvious to all of us sitting at this table, but may not be so obvious to those who sit at home. That is with the raison d'être of your department, your agency. As I read it, there are a couple of important functions that your audits and studies provide. One of them is to provide objective information, advice, and assurance to Parliament, territorial legislatures, governments, and Canadians.
Do you consider that as the prime function of your agency?
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2014-03-31 15:53
Expand
I think that very much is our prime function.
Collapse
View Stephen Woodworth Profile
CPC (ON)
Also, as I understand it, your office assists parliamentarians and territorial legislatures in their work regarding the authorization and oversight of government spending and operations. This too is a very important function and reason for your department.
Is that correct?
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2014-03-31 15:53
Expand
As we see our role, our role is to do the work, present the work to parliamentarians, and then parliamentarians can use it to hold government accountable.
Collapse
View Yvonne Jones Profile
Lib. (NL)
View Yvonne Jones Profile
2014-03-31 16:12
Expand
You talked about the fact that you had been requested by the Senate to do an audit of the Senate.
Do you want to tell us a little bit about the particular aspects you will be looking at in that audit and what timeframe it will cover?
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2014-03-31 16:12
Expand
We're looking at the spending of each and every senator, at every dollar that was spent by each and every senator over a two-year time period. I'd be going by memory to give the exact start and end date. I don't want to get it wrong. But it's a two-year time period for all of the spending of each and every senator that we're going through.
Collapse
View Alain Giguère Profile
NDP (QC)
So if human resources were used for partisan activities, you would investigate. An analysis would be done of the performance of Senate staff. Is that right?
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2014-03-31 16:25
Expand
Again, what we are looking at is whether the spending was incurred for Senate business. I am not going to go down into the particular examples that might be outside of that, but what the money was spent for has to meet the test of being for Senate business for all of the spending that occurred in that two-year time period.
Collapse
View Alain Giguère Profile
NDP (QC)
Let's talk about resources. You can meet your obligations with the budget you have, as long as departments co-operate with you, open their books wide and hold nothing back.
I remember a report that was presented by the commissioner of the environment and sustainable development on greenhouse gas emissions. He showed us the tables. I pointed out that he could not make a connection between the budgets spent annually and the reduction in greenhouse gas emissions sought, which was the government's objective. He basically told me that the departments themselves had provided approximate objectives in terms of greenhouse gas reductions. He could not do better because he did not have the relevant information.
Does the fact that the information for some files is not accessible influence your ability to prepare your report within the confines of your budget envelope?
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2014-03-31 16:31
Expand
Certainly for us to do any audit it's always imperative that we get the information we ask for. If we do not get the information we've asked for, we have an obligation to report that to Parliament.
Collapse
View Yvonne Jones Profile
Lib. (NL)
View Yvonne Jones Profile
2014-03-31 16:42
Expand
Have there been any other particular audits that have been done like that more recently and would not have been done in the past that have been added to the work of your office?
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2014-03-31 16:42
Expand
Again, I think one place where it has always been a bit of an issue as well in terms of how much access we have is with Parliament itself, either the House of Commons or the Senate. So I think the fact that we have access now to do the audit of the Senate is the type of audit that we have done only periodically rather than on a regular basis.
Collapse
View Glenn Thibeault Profile
Ind. (ON)
View Glenn Thibeault Profile
2014-03-31 16:52
Expand
Well, I would state that with all due respect, if you move the goalposts, it's easier to make the numbers look like you're fulfilling your mandate. We need to ensure, especially in this time of transparency and accountability that all parties are saying.... I think all parties want to see more of this. So how can we tell Canadians to rest assured that the Office of the Auditor General is able to do the audits it needs to? Because to quote what Mr. Ferguson said, there is “no shortage” of doing performance audits. That was his quote. There's no shortage of doing those. But what we have right now according to the statistics is a shortage of resources and a shortage of staff.
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2014-03-31 16:53
Expand
Again, I think it's important to understand that we have the financial audits and we have the special exams that we have to do according to legislation, so that's all covered. Then what's left over, essentially, if you want to look at it that way, is what we put toward performance audits. The amount of effort we put into performance audits, as I've said, hasn't reduced. If Parliament decided it wanted more performance audits, we're really at...Parliament telling us how many performance audits they want to do, and the way they do that is essentially by setting the budget.
So we can continue to do 30. Remember that performance audits are not just a function of our being able to do them, they're also a function of the departments being able to have the capacity to accept auditors in. That's another aspect of it. So within this budget, we're able to continue on with the 27 to 30 audits. If Parliament wanted us to do more, that would require more money.
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2013-11-27 15:33
Expand
Thank you.
Mr. Chair, I am pleased to present my Fall 2013 Report, which was tabled in the House of Commons yesterday. I am accompanied by assistant auditors general Wendy Loschiuk and Maurice Laplante, and principals Gordon Stock and John Affleck.
This report touches on a range of long-standing issues the government has been struggling to address, with potentially significant impacts for Canadians.
Rail safety is one such issue. Fourteen years ago, Transport Canada recognized the need to shift from an inspection-based oversight approach to one that integrates the oversight of safety management systems. This shift is ongoing. Much work remains to be done, and the transition is taking too long.
Transport Canada completed only 26% of its planned audits of federal railways over a three-year period. Most of these audits were narrowly focused and provided assurance on only a few aspects of railway safety management systems. The department has yet to establish an audit approach that provides a minimum level of assurance that federal railways have implemented adequate and effective safety management systems for complying on a day-to-day basis with Canada's framework for rail safety.
Our audit of Canada's food recall system showed that the Canadian Food Inspection Agency does a good job of managing most aspects of recalls. However, the weaknesses we saw in both follow-ups with industry and in large emergency recalls leave significant gaps in the system. While illnesses were contained in the recalls we examined, I'm not confident the system will always yield similar results. The weaknesses we found in decision-making and follow-up stand in the way of the continuous improvement of a system intended to deal with food safety incidents in Canada.
In this report, we also looked at how the Canada Revenue Agency followed up on a list of possible Canadian residents with accounts in a European bank. The Canada Revenue Agency's initial work on offshore banking information shows promise. However, with more lists to look at and changes in legislation that will give the agency access to more information, I believe that it needs to formalize its approach to deal with the increase in its workload.
In another audit, we looked at border controls to prevent illegal entry into Canada. It is very important for the safety of Canadians that controls at the border work as they are supposed to. I am very concerned that our audit found too many examples of controls not working.
Though the Canada Border Services Agency has made significant progress in some of its efforts to detect high risk travellers, it often does not get the information it needs to identify these travellers before they arrive in Canada. Furthermore, even when the agency has the information, we found that controls do not always work. We also found that the RCMP does not know the extent to which it is successful in intercepting people who enter the country illegally between ports of entry.
Though it is not the first time we have raised these issues, border controls are still not working as they should. With better analysis of existing information and better monitoring, many of these issues can be fixed.
Our audit of disaster assistance to agricultural producers is an example of a program with a disconnect between the program's objectives and its outcomes.
Providing quick assistance to agricultural producers is a key goal of the AgriRecovery program. While Agriculture and Agri-Food Canada has delivered assistance to producers for large disasters within their targeted timeline, those producers impacted by disasters with a smaller total payout often wait more than a year for financial help.
Agriculture and Agri-Food Canada needs to streamline its processes for smaller initiatives, and it must track whether it is meeting its timelines.
Let's now move on to our audit of online government services. We found that, since 2005, the government has not significantly expanded the services it offers online to its citizens. As Canadians rely more on the Internet in their day-to-day lives, they expect the government to provide them with online information and services that address their needs.
The government has estimated that savings can be realized by providing better online services for Canadians, but there needs to be a concerted client-focussed strategy. Departments need to work together to make this happen.
Our audit of Aboriginal Affairs and Northern Development Canada's role in supporting emergency management on first nations reserves showed that the department is in a cycle of reacting to emergencies. It has not been able to focus on what can be done to prevent and mitigate these events.
Some reserves continue to be adversely affected in significant ways by repeated emergencies, such as floods. These difficulties are compounded by the fact that the respective roles and responsibilities of the federal government and other stakeholders are unclear. Aboriginal Affairs and Northern Development Canada must work with other stakeholders, including first nations, to reduce the human and financial costs of emergencies over the long term.
We also followed up on our audit of internal controls over financial reporting. Eight years after the government made it a priority to have in place effective internal controls over financial reporting, I am concerned that several large departments are still years away from knowing whether these controls are in place and working effectively. With annual spending of nearly $300 billion across government, effective internal controls are a necessary part of safeguarding public assets. It is imperative that departments get this work done without further delay.
This report also looked at the national shipbuilding procurement strategy, specifically whether it has been designed and managed to help sustain Canadian shipbuilding capacity and capability over the coming decades. It's still early, but so far the strategy has resulted in the transparent and efficient selection of two yards to build ships for the navy and the coast guard.
Although only a few contracts have signed to date, and it will be a few years before any ships are delivered, the national shipbuilding procurement strategy shows promise. As with anything new, there are risks involved, and these will need to be closely monitored on an ongoing basis.
A look over the audits that we are reporting on today shows that, in many cases, the results need to be improved. Even when the government recognizes a problem, it takes too long to develop and implement solutions. The resulting delays can have significant impacts on Canadians, both directly and indirectly.
Departments need to focus on critical success factors that are proven to work. These include setting clear priorities, applying lessons learned, and monitoring deliverables against timelines and objectives.
Mr. Chair, that concludes my opening statement.
We are happy to answer any questions the members may have. Thank you.
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2013-11-19 11:01
Expand
Thank you.
Mr. Chair, thank you for inviting me to participate in your examination of the administrative oversight systems, policies, and practices of the House of Commons, including the role of the Board of Internal Economy. With me today is Clyde MacLellan, Assistant Auditor General.
I'm pleased that the House of Commons and this committee wish to explore the practices of provincial and territorial legislatures and other Westminster-style parliaments with respect to administrative oversight; to consider modifications to the roles of institutions, such as the Office of the Auditor General in that oversight; and to propose any other necessary modifications to the administrative policies and practices of the House of Commons.
I would like to start by mentioning a few broad principles that I think the committee could consider during its deliberations. Before this meeting, I provided the clerk of the committee with a short paper that elaborates on these principles. I would also refer the committee to our June 2012 Report on the Administration of the House of Commons of Canada. In this June 2012 audit report, we mentioned that demands have been increasing for political and government representatives to be held accountable for their use of public funds.
In particular, we noted that members of Parliament hold positions of trust and have responsibilities to their specific constituents and to Canadians in general that are considerable. In my opinion there are three fundamental elements that contribute to the fulfilment of these responsibilities. They are transparency, accountability, and good governance.
I believe that providing detailed public disclosure of members' expenses, and having clear policies and processes for those expenses, establishes an environment of transparency, and transparency is the foundation of accountability.
In my opinion, governance can be strengthened by having an independent body that would either advise the Board of Internal Economy or be given the responsibility for all matters related to members' expenses and entitlements. Regardless of the role of such a body, it is important that Canadians are confident that its membership is independent and that the members have been chosen in a non-partisan manner.
I also believe that independent comprehensive audits, including financial statement audits, compliance audits, and performance audits, would not only strengthen members' accountability but would also enhance the public's confidence in the governance mechanisms of the House of Commons.
The committee may therefore wish to consider whether the mandate of the Office of the Auditor General should be amended to include this role. The right to conduct such audits, at the discretion of the Auditor General, should be clearly described in statute. Because we regularly conduct all of these types of audits, the Office of the Auditor General has a unique ability to contribute, and we are ready and willing to take on this role.
Canadians expect members of Parliament to spend the moneys they receive for the functions of their office in an ethical and prudent manner and for approved purposes. Members are accountable to one another in the House of Commons and to the public for their actions. It is their responsibility to carry out their assigned mandate in light of these expectations. I therefore believe that the changes the committee will decide to make, while respecting the many unique aspects of the institutions, need to be significant enough that a reasonable person with a healthy degree of skepticism would be satisfied that the rules are being consistently applied and sufficiently monitored.
In conclusion, members of Parliament must be properly supported in order to carry out their duties effectively. Refining the mechanisms that promote transparency, accountability, and good governance will enable members to fulfill their roles and responsibilities and meet the expectations of Canadians.
Mr. Chair, this concludes my opening statement. We would be pleased to answer any questions that the committee may have.
Collapse
Clyde MacLellan
View Clyde MacLellan Profile
Clyde MacLellan
2013-11-19 11:09
Expand
Thank you, Mr. Auditor General.
Just as the Auditor General indicated, in order to try to answer this question I have to relate back to the audits we did in 2012 on both institutions, keeping in mind that those were audits of the administration and not necessarily the governance regime of both chambers. It's very clear in those audits that we didn't audit the Board of Internal Economy in the case of the House, or the Standing Committee on Internal Economy in the case of the Senate.
That said, we did have an opportunity to interact with how the administration plays its role in the oversight of expenditures, and what other types of bodies are present. That may be able to help in that regard.
My perception on that would be that there are a lot of similarities, perhaps more than there are differences. In thinking about that type of question earlier this morning, one of the big issues I recall from those two particular audits was the nature of documentation that was present in the case of the Senate with respect to our being able to determine whether or not the expenses were incurred for the purposes intended.
If you go back to the two different reports, we provided tables in those documents about the percentage of compliance with regard to our ability to determine whether or not those expenses met their intended purposes. That's largely for purposes of the role of members, in the case of this chamber, and in the case of senators in the case of the red chamber.
The difference is that when we did that audit, in about 98.5% of the transactions we looked at we were able to conclude that they met that condition. In the case of the Senate, it dropped down to about 94.8%. That had a lot to do with the way in which documentation was kept vis-à-vis the role of the administration and individual senators, an issue that we didn't really encounter here.
As it relates to policies and procedures, at a very macro level there were quite a bit of similarities and what you would expect to see in terms of proper authorization, proper documentation being required, proper approvals being necessary, and reviews by the administration. In both cases I think we got lots of comments that many members and many senators felt they were under a lot of scrutiny by the administration on how the expenses were being incurred. Yet we still found instances where the documentation was not sufficient in both cases, but we had a bigger struggle with that in the case of the Senate administration, which is why we made very specific recommendations in that report about that subject.
Both groups have a committee. Here, the Board of Internal Economy, and there it's the Standing Committee on Internal Economy. At a macro level there are a lot of similarities in terms of the expectations, roles, and responsibilities of both of those organizations from a governance perspective. We looked at the roles of internal audit as being important in providing some kind of oversight to assist the particular boards, and we made recommendations in both cases.
I hope that helps a little bit in giving you some clarity on those. But I would say that at a macro level they're very similar in the details, and a little bit of a difference that was sufficient for the nature of the recommendations we made.
Collapse
View Peter Julian Profile
NDP (BC)
That's an important point you've made. We've objected to the cutbacks the Conservative government has imposed on your office.
I have a final question.
Collapse
Neil Maxwell
View Neil Maxwell Profile
Neil Maxwell
2013-06-04 9:51
Expand
Thank you, Mr. Chair.
It's a pleasure to share our views on the draft federal sustainable development strategy. I'm joined today by Jim McKenzie, a senior colleague in the office.
Under the Federal Sustainable Development Act, I'm required to review the draft strategy and provide comments to the Minister of the Environment by June 14. We are still finalizing our review. Today I am providing our initial findings.
We are strong proponents of the requirement for a federal sustainable development strategy. It responds to concerns we expressed numerous times, as the minister noted, culminating in our 2007 report when we concluded that the existing process was not working. We recommended that the government establish overall federal goals for sustainable development.
We believe the strategy is essential as a means for the government to explain its environmental and sustainable development plan. We have found to date that the strategy addresses environmental issues that are indeed relevant and important to Canadians. A number of improvements are needed, however, for it to achieve its full potential. The strategy needs to be more complete and clear.
The strategy's intent is to build a whole-of-government picture by ensuring that it addresses important challenges and problems. However, we found it to be incomplete in some respects. First, some key initiatives are missing, such as the government's responsible resource development agenda and plans to monitor water, land and biodiversity in the oil sands region.
As well, the strategy does not include an indication of the resources that will be allocated to deliver on the targets and implementation strategies.
For the strategy to be clear, its targets and implementation strategies must also be clear and measurable. They provide the basis for assessing and reporting on the strategy's goals. They are also an important part of good accountability and transparency. In this regard, most of the 34 targets lack sufficient clarity, which will make it difficult to assess progress over the short and long term.
Collapse
Nancy Cheng
View Nancy Cheng Profile
Nancy Cheng
2013-03-05 15:32
Expand
Mr. Chair, thank you for the opportunity to meet with your committee today to discuss chapter 7 of our fall 2012 report, on long-term fiscal sustainability. Joining me at the table is Richard Domingue, the principal responsible for this audit.
Long-term fiscal sustainability refers to whether the government can finance its activities and debt obligations in the future without imposing an unfair burden on future generations. Factors like changing demographics can put pressure on Canada's fiscal position in the long term.
After the financial turmoil in 2008 and its negative impact on the government's fiscal outlook, long-term fiscal sustainability became even more important. In this context, analyses that provide a long-term budgetary perspective would help parliamentarians and Canadians better understand the fiscal challenges we face.
Our audit objective was to determine whether the Department of Finance Canada took into account the long-term fiscal impact when proposing budget measures and policies, and whether it reported this type of information publicly.
We first selected six recent budget measures to determine if the Department of Finance Canada analyzed the long-term fiscal impact of these measures and considered the results when recommending them. To protect the government's fiscal position in the long run, it is important that policy makers understand the future budgetary impact of decisions made today.
Based on our audit, we concluded that the Department of Finance Canada had the capacity and tools to carry out long-term fiscal analyses. We found that such analyses were carried out when the department considered it to be relevant. For changes to the Canada Health Transfer and Old Age Security, the department analysed the long-term fiscal impact of the proposed changes on the federal government, and on the provinces and territories. We noted that the results of those analyses were used to make recommendations.
We then looked at whether the department reports projections on Canada's long-term fiscal position. Although the department analyzed the impact of individual budget measures, it is also important to make available, before concluding the budget process, an overall assessment of their combined impact on the government's long-term fiscal position.
We found that Finance Canada does prepare an analysis of the overall long-term fiscal position of the government. However, it is not prepared or provided to the minister before the budget process is concluded.
For example, we found that an analysis of the long-term overall impact of the March 2012 budget was given to the minister in August 2012, five months after the budget was tabled.
At the conclusion of the 2012 budget measures, senior management and the Minister of Finance had not been informed of the measures' combined impact on the government's long-term fiscal position.
We recommended that the minister be informed of the overall impact of budget measures before final choices were made and approved. Finance Canada agreed with the recommendation. Starting in 2013, it plans to provide the minister with this information before decisions are finalized.
In its 2007 budget, the Government of Canada committed to publishing a comprehensive report on fiscal sustainability and intergenerational equity. We found that the government had not followed through on this commitment. In the absence of publicly available information—and to illustrate the overall impact of the 2012 budget on the government's fiscal sustainability—we prepared 40-year projections by replicating the economic and fiscal conditions at the time when those decisions were made. As we illustrate in exhibit 7.5 of our report, our projections showed that the 2012 budget will have a significant positive impact on the sustainability of public finances for the federal government.
Within hours of our report being submitted, the department published the government's first long-term fiscal report. In response to our recommendation, the Department of Finance committed to publishing long-term fiscal analyses for the federal government annually. It is commendable that the government implemented this recommendation so quickly. As a result, Canada joins a good number of OECD countries that have published long-term fiscal sustainability analyses.
In addition to reporting at the federal level, we also recommended that from time to time the department report an analysis for all levels of government combined, including the federal, provincial, and territorial governments. We note Finance Canada has the capacity and the information to prepare a combined report. A comprehensive report would provide a complete long-term fiscal outlook for Canada.
We note the International Monetary Fund recently urged Canada to publish a fiscal sustainability report covering all levels of government. We encourage the government to take steps to analyze the fiscal position for all of Canada and to report it periodically.
Mr. Chair, this concludes my opening remarks. We would be pleased to answer questions from members of your committee.
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 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
Jerome Berthelette
View Jerome Berthelette Profile
Jerome Berthelette
2012-10-29 15:34
Expand
Good afternoon, Mr. Chairman
I would like to thank you for inviting the office to speak about Bill C-27, an Act to Enhance the Financial Accountability and Transparency of First Nations.
With me is Ronnie Campbell, Assistant Auditor General, who was formerly responsible for first nations' audits.
Since 2000, the office has tabled 16 chapters that address first nations and Inuit issues directly, and another 15 chapters that deal with issues of importance to first nations people.
In 1996, we tabled a study entitled “Study of accountability practices from the perspective of first nations”. We noted that the relationship between the first nations and the federal government had evolved from direct service delivery by the department to service delivery by first nations. As a result of this evolution, the issue of accountability presented difficulties for both parties. In particular, the accountability of that government to Parliament became more complicated as departments were no longer directly responsible for the delivery of programs at the community level.
At that time, we met with first nations and were told that they were willing to explore ways to ensure that the information needs of Parliament were met, and they stressed the importance of internal accountability. From their perspective, accountability is non-hierarchical and is based on shared objectives.They stated that the reporting framework was of limited value to them, was onerous, and did little to enhance accountability to the community.
In 2002, based in part on what we had learned from the 1996 study, we proposed our definition of accountability: a relationship based on obligations to demonstrate, review, and take responsibility for performance, both the results achieved in light of agreed expectations and the means used. We defined five principles that support an effective accountability relationship: clear roles and responsibilities; clear performance expectations; balanced expectations and capacities; credible reporting; and reasonable review and adjustment.
We noted that delivery of programs through partners creates new and complex accountability relationships. In these arrangements, accountability is shared. With respect to reporting, we suggested the need to be clear about the measurement strategy as well as the required information and how it is to be collected, verified, and analyzed, and by whom and when.
In this work, we also stated that transparency is the sustaining element of accountability; transparency implies that one can see clearly into the activities of government. Transparency and accountability mean stronger institutions and more credible government.
Also in 2002, we tabled a study on first nations reporting. We stated that reporting needs to provide meaningful information to first nations and to the federal government and that fundamental change was required to reduce the burden on first nations.
In 2011, we identified four structural impediments that limit the delivery of public services to the first nations and hinder improvements in living conditions on reserves: lack of clarity about service levels; lack of a legislative base; lack of an appropriate funding mechanism; and lack of organizations to support local service delivery.
We strongly support the principles of accountability and transparency. We hope this background on accountability will be useful to the committee as it reviews the proposed legislation.
Mr. Chair, we do not feel that our office can comment on the merits of Bill C-27. That being said, we would like to make a few remarks on some technical aspects of the bill.
First, subclause 5(1), on how first nations are to maintain their accounts, contains the expression “generally accepted accounting principles” and a reference to the Canadian Institute of Chartered Accountants handbooks. There are currently no accounting standards in Canada that explicitly mention first nations. Although the handbooks referred to in subclause 5(1) are generally pertinent to the activities of first nations governments, they have not been designed or amended to take those particularities of the first nations situation into account.
Second, under subclause 5(2), when auditing the accounts of first nations having transactions that do not easily fit a particular standard, the auditors must assess the acceptability of the accounting framework, including the reasonableness of the accounting policies adopted by these first nations. Different auditors may come to different conclusions for similar transactions.
Third, in clause 6, the requirement for an audited or reviewed schedule of remuneration is unique. This information is normally provided as a note to the financial statements or as supplemental information in an annual report. There are no accounting standards made applicable to the preparation of this schedule of remuneration or to the auditor's report or review engagement report. Also, it is not clear who would decide, and on what basis, whether the schedule is to be audited or reviewed. This ambiguity increases the risk of confusion and inconsistent practices.
Finally, the definition of remuneration in clause 2 combines both salary and reimbursement of expenses. When other levels of government report salary and reimbursement of expenses, they do so separately. Among other things, this ensures a clear distinction between official salaries and wages and the reimbursement of travel and other expenses. For example, at the federal level, there are separate disclosure requirements for salaries and for travel and hospitality expenses.
Mr. Chair, this completes my opening remarks. We would be glad to answer any questions the committee members may have.
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2012-10-25 11:37
Expand
Thank you, Mr. Chair.
Mr. Chair, I am pleased to present my report, which was tabled in the House of Commons last Tuesday.
I am accompanied by Assistant Auditors General Jerome Berthelette and Wendy Loschiuk, as well as by Glenn Wheeler, the principal responsible for the audit of transfer payments to the aerospace sector.
The report contains the results of that audit. In the first chapter, we looked at how Public Works and Government Services Canada, Health Canada, and Human Resources and Skills Development Canada plan their use of professional service contractors. We found that the departments plan their needs for employees and contractors separately. This hampers their ability to assess whether they have the best mix of employees and contractors to meet their objectives.
Departments need to consider the full range of options that will enable them to most effectively deliver programs and services to Canadians.
I'll move now to our report about grant and contribution program reforms. In May 2008 the government announced an action plan to reform the administration of grant and contribution programs and to streamline the administrative and reporting burden on recipients. Our audit looked at whether the government has adequately implemented this action plan. We found that the government has in fact focused its actions where they're most important. Treasury Board Secretariat has provided leadership and guidance to federal organizations to make the necessary changes, and these organizations have acted on most of their obligations. The government has made good progress in implementing the 2008 action plan. Now it needs to determine if the actions taken have made a difference for recipients.
Let's turn now to our audit about what government is doing to help protect Canadian infrastructure against cyber threats. Critical infrastructure includes the power grid, banking and telephone systems, and the government's own information systems. The government has a leadership role to play in ensuring that information about threats is shared, and it has to improve the way it does this. This is important because officials are concerned that cyber threats are evolving faster than the government can keep pace.
In 2001 the government committed to building partnerships with the owners and operators of critical infrastructure systems to share information and provide technical support. We found that 11 years later, those arrangements are not fully operational. Similarly, the Canadian Cyber Incident Response Centre has only been operating eight hours a day, five days a week. It's not the 24/7 information hub it was designed to be in 2005. Furthermore, it's not being kept abreast of cyber security incidents in a timely manner.
Since 2010, the government has made some progress in protecting its own systems and building partnerships to secure Canada's infrastructure. The government must now ensure that the sector networks are in place and working with the Cyber Incident Response Centre.
We are also reporting on how National Defence and Veterans Affairs Canada manage selected programs, benefits, and services to support eligible ill and injured Canadian Forces members and veterans in the transition to civilian life.
There are many support programs, benefits, and services in place to help ill and injured members of the military make the transition to civilian life. However, we found that understanding and accessing these supports is often complex, lengthy, and challenging. The lack of clear information about programs and services, the complexity of eligibility criteria, and the dependence on paper-based systems are some of the difficulties for both clients and departmental staff.
We also found inconsistencies in how individual cases are managed and problem-sharing information between the two departments. As a result, forces members and veterans did not always receive services and benefits in a timely manner or at all.
National Defence and Veterans Affairs recognize they need to work together on solutions. I'm pleased they've accepted our recommendations, including to streamline their processes to make programs more accessible for ill and injured forces members and veterans.
The next report also concerns National Defence—specifically, how the department is managing its real property at 21 main bases across Canada. The Canadian Forces rely on real property such as buildings, airfields and training facilities to carry out missions. These assets are valued at $22 billion. I am concerned that the department is not yet adequately maintaining and renewing its assets.
We found several weaknesses in the department’s management practices. For example, the approval process for construction projects is cumbersome and slow. It takes an average of 6 years to approve projects over $5 million.
We also found that National Defence is behind in its spending targets for maintenance and repair, and recapitalization. As such, weaknesses in National Defence’s management of real property could jeopardize the Canadian Forces’ ability to carry out its missions. National Defence recognizes it needs to improve and change its approach to managing real property.
We also looked at two programs that provide repayable assistance to support industrial research and development in Canada’s aerospace sector. Since 2007, Industry Canada has authorized almost $1.2 billion in assistance to 23 Canadian aerospace companies through the Strategic Aerospace and Defence Initiative and the Bombardier CSeries Program. Industry Canada has done a good job of managing most of the administrative aspects of the two transfer payment programs. However, we found that the department has been slow to measure progress against program objectives and report results publicly. Repayable support to the aerospace sector represents a significant investment on behalf of Canadians. Industry Canada has a responsibility to ensure that funding contributes to meeting the government’s objectives in this area.
Finally, in our audit focusing on long-term fiscal sustainability, we found that Finance Canada analyzes and considers the long-term fiscal impact of the policy measures it recommends. However, at the time of the audit, the government had yet to make public its reports on long-term fiscal sustainability. Analysis that provides a long-term budgetary perspective would help parliamentarians and Canadians better understand the fiscal challenges facing the federal government.
The department has accepted our recommendations. Following the tabling of my report in Parliament, the department issued its first long-term analysis for the federal government. We also recommended that the department publish, from time to time, an analysis for all governments combined—federal, provincial, and territorial—to give a total Canadian perspective.
Mr. Chair, that concludes my opening statement.
We will be happy to answer any questions you may have.
Collapse
Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2012-05-15 8:48
Expand
Good morning, Mr. Chair.
I am pleased to be here again to discuss chapter 2 of my spring report. I am accompanied by Assistant Auditor General, Jerome Berthelette.
We have followed the committee's deliberations and will be pleased to answer your questions.
I would like to take this opportunity to address a few points that have come up in the course of this committee's work.
To begin with, I would like to address the issue of life-cycle costing for the acquisition of goods and services. Life-cycle costing is required by Treasury Board policies and is also included in the Department of National Defence's own project approval directive. This directive states the following:
The life-cycle cost estimate includes estimates of the total cost of the resources needed to complete project activities and deliver the product system infrastructure, i.e., project acquisition costs, as well as the cost of the resources needed to operate, maintain, and dispose of the product system infrastructure, i.e., ownership costs.
While we believe in and support life-cycle costing, it is not a requirement established by the Office of the Auditor General.
As illustrated in exhibit 2.6 of the chapter, life-cycle costing includes two main categories. The first is capital costs. The second is the cost of personnel, operating, maintenance and contracted sustainment. All figures appearing in exhibit 2.6 are National Defence's estimates and not those of the Office of the Auditor General.
As described in the chapter, we believe that the Department of National Defence did not include some significant cost elements in a testament of life-cycle costs. In addition, many of the costs are not yet known or cannot be reliably estimated. These are itemized in paragraphs 2.71, 2.72, and 2.73 of the chapter.
The estimated life of the F-35 is about 8,000 flying hours per aircraft. The estimated life of the aircraft is calculated in years, based on the number of anticipated flying hours per year per aircraft.
Working from estimates of contracted sustainment costs over 36 years provided by the joint strike fighter program office, National Defence is able to estimate costs over 36 years.
Mr. Chair, I am concerned with suggestions that accurate estimation and the inclusion of personnel, operating and maintenance costs are not important, since they would be incurred regardless of the aircraft selected to replace the CF-18. National Defence states that its $16-billion estimate is already within its base budget. It is important for decision makers and parliamentarians to understand National Defence's estimate for personnel, operating and maintenance costs even though these estimates are already within the existing budget allotment.
National Defence currently assumes that the F-35 fleet costs will be similar to those related to the CF-18 fleet. We reported on a similar situation in chapter 6 of our fall 2010 report on the acquisition of military helicopters. Specifically, we noted that National Defence initially assumed that the personnel, operating, and maintenance costs for the new Cyclone maritime helicopter would be the same as those for the legacy Sea King it was replacing. National Defence later realized that these costs would exceed those associated with the Sea King by $1.1 billion over 20 years.
Finally, Mr. Chair, I would like to state for the record that we stand behind all of the facts presented in the chapter, and note that these facts were accepted by the department.
This concludes my remarks. We would be pleased to answer any questions the committee may have.
Thank you.
Collapse
Jerome Berthelette
View Jerome Berthelette Profile
Jerome Berthelette
2012-05-15 9:37
Expand
Mr. Chair, I'll try to give a high-level explanation in response to the member's question.
National Defence has conducted a number of options analyses related to the next-generation fighter jet project and the decision as to whether to go ahead with the joint strike fighter. They assessed the jet against four other options early in the process, back around 2005. They assessed the F-35 and two other options around the time they were coming to make the decision in 2008, I believe. They used high-level mandatory capabilities to assess jets around the second options analysis, which was around 2008. They then set about establishing the statement of operational requirements, which should have been the basis upon which the final decision was made.
So yes, National Defence did consider other options. Yes, there was a basis for how they considered those other options.
Collapse
Neil Maxwell
View Neil Maxwell Profile
Neil Maxwell
2012-03-29 8:53
Expand
Thank you, Mr. Chair.
Thank you for this opportunity to present the results of our audit on regulating pharmaceutical drugs at Health Canada.
With me today, as you noted, is Louise Dubé, the principal responsible for audits in the health sector.
There are about 13,000 prescription and non-prescription drugs on the Canadian market. Pharmaceutical drugs play an important role in Canada's health care system and economy. Health Canada regulates the safety, efficacy, and quality of all pharmaceutical drugs in Canada before and after the products enter the Canadian marketplace.
The department does this through a combination of scientific review, monitoring, compliance, and enforcement activities. It aims to ensure that the public has timely access to safe and effective pharmaceutical drugs, and that those who need to know of safety concerns are informed.
For our 2011 fall report, we examined whether Health Canada fulfilled its key responsibilities for pharmaceutical drugs. These responsibilities involved timeliness, consistency, transparency, conflict of interest, and risk-based post-market activities.
We found that the department had not adequately fulfilled most of these key responsibilities related to clinical trials, submission reviews, and post-market activities.
In particular, we found that Health Canada had problems with the timelines and transparency of its activities.
Health Canada is not meeting its service standards for the timely review of most of the drug submissions it receives, thus delaying Canadians' access to the health benefits of new drugs. It is also delaying access to more affordable treatments.
Health Canada has established processes to identify potential safety issues for marketed drugs, but it is slow to act. It can take the department more than two years to complete an assessment of potential safety issues and to provide Canadians with new safety information.
In 2004, the House of Commons Standing Committee on Health recommended that this department create a public database to provide information on clinical trials in progress, abandoned and completed. Health Canada committed to enhancing public access to information about clinical trials. In the fall 2011 audit, we found that, despite this commitment, Health Canada had not taken action. This lack of information increases the risk that Canadians may be unaware of new treatment options or may unknowingly participated in an unauthorized trial.
The department is also not disclosing information on drugs that it rejects, drugs that the manufacturer withdraws from the review process, or drugs with conditions.
Health care providers have the discretion to prescribe a drug for conditions that the drug has not been authorized to treat. Therefore, it is important that health care providers be informed when the department rejects a marketed drug for a new use, so they understand the department's concerns.
We reported very similar findings in our June 2011 report on the regulation of medical devices about a lack of timeliness to review submissions related to those devices. We found that Health Canada was not making use of assessment work done in other jurisdictions, as part of its own assessments of the safety and efficacy of medical devices that could lead to program efficiencies. Health Canada has recently launched an initiative to make greater use of this information for medical devices and pharmaceuticals.
We are pleased that Health Canada has agreed with our recommendations from both reports and that it has developed action plans to address them.
The regulation of pharmaceutical drugs is important to Canadians. With an aging population, the role of pharmaceuticals is expected to grow as researchers come up with new therapies to replace earlier treatments or provide new options where no treatment existed before. The committee may wish to obtain the assurance and commitment from Health Canada to implement our recommendations in a timely manner.
Mr. Chair, that concludes my opening statement. We would be pleased to answer your committee's questions.
Collapse
Scott Vaughan
View Scott Vaughan Profile
Scott Vaughan
2012-03-08 15:34
Expand
Mr. Chair, thank you very much for this opportunity to discuss our office's work related to aboriginal land use and sustainable development.
Related to this topic, in December 2011 my colleagues briefed this committee on chapter 6 of the Auditor General's fall 2009 report, “Land Management and Environmental Protection on Reserves”. Today, I will be focusing most of my comments on chapter 4 of the Auditor General's spring 2010 report, “Sustaining Development in the Northwest Territories”.
With me today is Frank Barrett, the principal responsible for the audit, and Kim Leach, the principal who also worked on this audit.
The federal government has a mandate to promote political and economic development in the Northwest Territories and to protect the environment. Our audit looked at whether responsible federal departments had laid the foundations for sustainable and balanced development in the Northwest Territories. Specifically, the audit focused on whether Aboriginal Affairs and Northern Development Canada, Environment Canada, and Human Resources and Skills Development Canada had adequately implemented key measures to prepare for sustainable development.
These measures included settling comprehensive land claim agreements and self-government agreements; establishing and implementing a regulatory system that protects the environment; and supporting appropriate economic development and skills training programs for aboriginal peoples in the Northwest Territories.
Comprehensive land claim agreements and self-government agreements set out governance rights and the ownership of land and resource rights. These agreements are therefore important for economic development. They help to provide a level of certainty and predictability for business, industry, communities and governments. Almost all of the Northwest Territories either lies within settled land claim areas or is the subject of ongoing negotiations.
At the time of our audit, four land claim agreements had been finalized. Other land claim and self-government agreements were under negotiation. We found that Aboriginal Affairs and Northern Development Canada had made constructive efforts to negotiate these agreements and had followed the established processes for their negotiation. As well, the department had used alternative approaches when negotiations appeared to be stalled.
While much remains to be done, in our view the efforts to settle land claim agreements and self-government agreements represent a significant achievement and an important step towards sustainable development in the Northwest Territories.
We have also looked at the environmental regulatory system. Protecting the environment is important particularly because aboriginal communities in the Northwest Territories depend on wildlife, water, and land for subsistence and for economic development opportunities.
We examined whether Aboriginal Affairs and Northern Development Canada and Environment Canada had established and implemented an adequate regulatory system in the Northwest Territories. We found that, in regions with settled land claim agreements, there are systems and structures that support land use plans and provide a means of adequate consultation with communities.
In regions without comprehensive land claim agreements, however, there was uncertainty about aboriginal title to the land, how it might be used, and who should be consulted. Moreover, in those regions without land claim agreements, we noted a lack of specific mechanisms for developing land use plans. Without a formal land use plan, development decisions must be made on a case-by-case basis. Decisions related to project approvals may therefore take longer, because it has not been determined where different types of development should take place and what conditions should be applied.
AANDC also has specific responsibilities for monitoring the cumulative impacts of development. This information is important because it provides co-management boards with environmental information to support informed decision-making on development proposals. Our audit found that 11 years after receiving a mandate to do so, AANDC has not yet put in place a program to monitor cumulative environmental impacts. Similarly, funding for Environment Canada's program that would support cumulative impact monitoring ended in 2007. As a result, neither department has implemented this program.
Our audit also examined skills training and economic development programs for aboriginal communities. We found that Human Resources and Skills Development Canada had established clear objectives and targets for both of their programs that we examined but that Aboriginal Affairs and Northern Development Canada's economic development programs did not have clear objectives and that the department did not monitor its programs' performance or review information reported by funding recipients.
Overall, we concluded that Aboriginal Affairs and Northern Development Canada and Environment Canada had not adequately implemented key measures designed to prepare for sustainable and balanced development in the Northwest Territories.
We have done other audits that have addressed broad issues around environmental protection and sustainable development that affect aboriginal communities. One issue that we hear about from communities, particularly in the north, is the impact of climate change. In another 2010 audit we examined how the federal government was helping communities prepare for and adapt to climate change.
The federal government has confirmed that climate change is already under way, and its impacts will affect every major economic sector, every region, and many communities. Observed impacts are already under way in Canada's north. We found that while good work was under way in helping community leaders understand the localized impacts of climate change, the demand from across Canada was outstripping the ability of the federal government to keep up.
In another 2010 audit we looked at the capacity of the federal government to prepare for and respond to oil spills from ships. Last week the Auditor General was in Iqaluit and heard from their public accounts committee about their concerns around the possible opening of the Northwest Passage and the implications of an oil spill in the north.
Finally, we have also audited different aspects of freshwater management. In 2005, and again in our 2011 follow-up audit of programs for first nations, we found that drinking water quality on reserves was significantly worse than what was found in most Canadian communities.
I should point out that these audits to which I refer are over two years old and we have not looked at these issues since then.
Mr. Chair, that concludes my opening statement. We'll be pleased to take questions from honourable members.
Thank you.
Collapse
Results: 1 - 33 of 33

Export As: XML CSV RSS

For more data options, please see Open Data