Public Accounts Committee on March 8th, 2011

[The Chair (Hon. Joseph Volpe (Eglinton—Lawrence, Lib.)), Liberal, Joe Volpe]

Colleagues, pursuant to Standing Order 108(3)(g) and the motion adopted by the committee on Thursday, November 25, 2010, a study of public accounts in Canada 2010, referred to the committee on Thursday, October 20, 2010, we have with us today, from the Office of the Auditor General of Canada, Mr. John Wiersema, Deputy Auditor General, and Madam Nancy Cheng, Assistant Auditor General.

From the Treasury Board Secretariat, we have Mr. James Ralston, Comptroller General of Canada, Mr. Bill Matthews, Assistant Comptroller General, Financial Management and Analysis, and Madam Suzie Gignac, Executive Director, Government Accounting Policy and Reporting, Financial Management Sector.

We're waiting for Monsieur Benoît Robidoux, Assistant Deputy Minister, Economic and Fiscal Policy Branch, from the Department of Finance. When he comes in we'll say hello, but we'll go on with our business.

Colleagues, you'll note that we're going to put committee business down towards the end, in deference to the witnesses who are here today and who were here one month ago and were so dutifully patient while we went about other business.

I want to again express, on behalf of the entire committee, an apology for having kept them waiting for such a long time on the last occasion and a special appreciation for making themselves available today to the committee.

Without further ado, we'll begin with Mr. John Wiersema.

[John Wiersema, Deputy Auditor General, Office of the Auditor General of Canada]

Thank you, Mr. Chair.

Thank you for the opportunity to discuss our audit of the 2009-10 summary financial statements of the Government of Canada.

As you indicated, I'm accompanied today by Nancy Cheng, who is the Assistant Auditor General responsible for this audit.

We are pleased to see that the committee is holding this hearing on the Public Accounts of Canada, a key accountability report of the government. The Comptroller General will be explaining the main points in the government’s financial statements to the Committee.

I will focus on our audit opinion and observations.

The Auditor General's report on the 2009-10 financial statements is included on page 2.4 of volume 1 of the Public Accounts. The opinion provides Parliament with the assurance that the government's financial statements are presented fairly in accordance with the government's stated accounting policies, which conform to generally accepted Canadian accounting principles. It can be referred to as a clean opinion. Our office has been able to issue such an opinion in each of the past 12 years. We commend the government for its considerable efforts and due diligence in preparing these financial statements.

As legislative auditor, we have an obligation to bring to the attention of Parliament any other matter that we believe is significant. This year we draw Parliament's attention to significant changes to the accounts of the employment insurance program as a result of amendments to the Employment Insurance Act. As disclosed in note 4 to the financial statements, one such amendment was the closure of the former employment insurance account, with a balance of about $57 billion.

I would now like to discuss an item that we have presented in our observations. Various transfer programs take place each year. Since the majority of the stimulus activities and actions related to the economic action plan announced last year took place in the 2009-10 fiscal year, our audit focused on the accounting for these transactions, including significant transfers made to support infrastructure projects. We concluded that the government's accounting for these initiatives is appropriate.

We are also pleased to note that volume 1, section 1 of the Public Accounts includes a discussion about the stimulus spending and on on-going initiatives relating to Canada’s economic action plan.

Other significant transfers made during the year related to $5.9 billion of compensation to the provinces of Ontario and British Columbia to harmonize the sales taxes in those provinces with the federal goods and services tax. We agreed with the government’s accounting for these transactions as an expense in the 2009-2010 fiscal year.

More details can be found in our observations. They also include an update on issues raised in the previous years. These observations can be found on pages 2.34 to 2.37 of volume I of the Public Accounts.

In conclusion, we would like to thank the staff of the Office of the Comptroller General and those in all of the departments involved in preparing these accounts. It involves many hours of painstaking work.

If I can add, Mr. Chair, the documents the government has produced--the Comptroller General with his colleagues in the Department of Finance and the Receiver General--in sections 1 and 2 of volume I of the Public Accounts are very high-quality documents. I congratulate them on that.

Mr. Chair, we would be pleased to answer any questions the committee may have.

[The Chair, Liberal, Joe Volpe]

Thank you, Mr. Wiersema.

I'm going to go to Mr. Ralston.

[James Ralston, Comptroller General of Canada, Treasury Board Secretariat]

Thank you, Mr. Chair and members of the committee.

Thank you very much for the invitation to appear before this committee to discuss the Public Accounts of Canada. I am pleased to be here in my role as Comptroller General of Canada.

With me are two members of my staff, Mr. Bill Matthews, Assistant Comptroller General, Financial Management Sector, and Ms. Suzie Gignac, Executive Director, Government Accounting Policy and Reporting.

For the 12^th consecutive year, the Auditor General has issued an unqualified opinion on the government’s financial statements. This testifies to the high standards of the government’s financial statements and reporting.

I would like to thank the Auditor General and her office for the continued professional working relationship that we have enjoyed.

Mr. Chair, we have tabled a slide presentation outlining some of the key financial results for the fiscal year ended March 31, 2010. We can go through the presentation, or if you would prefer, we can simply table the presentation and go straight to questions from the committee.

[The Chair, Liberal, Joe Volpe]

Thank you, Mr. Ralston, for your presentation.

I assume that Mr. Matthews and Ms. Gignac are both agreed. So, this ends the presentation.

Mr. Robidoux, you have already been introduced. Welcome to the committee. You don’t have a presentation to make to us.

[Benoît Robidoux, Assistant Deputy Minister, Economic and Fiscal Policy Branch, Department of Finance]

[Inaudible—Editor], unfortunately.

[The Chair, Liberal, Joe Volpe]

But you are still ready to take our questions?

[Benoît Robidoux]

I’m very happy to be here, and I’m available to answer your questions.

[The Chair, Liberal, Joe Volpe]

Thank you very much, Mr. Robidoux.

For the information of the other committee members, Mr. Robidoux is representing the Department of Finance.

I will now go immediately to Mr. Navdeep Bains. You have seven minutes.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

Thank you, Mr. Chair.

Thank you very much for being back today. It's nice to see some familiar faces.

The first question I have is for Mr. Ralston.

Did you sign off on the severance agreement for Ms. Ouimet?

[James Ralston]

No, I did not.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

Are you aware of who would have signed off on the severance agreement for Ms. Ouimet?

[James Ralston]

I imagine it would have been in the Privy Council Office.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

There was no correspondence and no negotiations with the Treasury Board as to the amount and how that was to be arranged?

[Andrew Saxton, Conservative, North Vancouver, BC]

Mr. Chair, I have a point of order.

I don't see anywhere in the Auditor General's report anything to do with this subject. That's not why we're here today. We're here to review the Auditor General's reports. This is not the time and place for those questions.

Mr. Bains should wait until Thursday for those questions.

[The Chair, Liberal, Joe Volpe]

Mr. Saxton, we are talking about the public accounts, so I don't think it's a question of order.

Continue, Mr. Bains.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

I just want a clarification on how the process works. How is the severance determined?

[James Ralston]

I was not involved.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

Are you aware of it? Do you know what the process is?

[James Ralston]

No. I had nothing to do with that particular transaction. That does not fall within the responsibilities of the Office of the Comptroller General.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

Thank you.

The question I had for the Auditor General with respect to this particular severance package is whether it's appropriate for the minister or the Privy Council to make such an agreement with an independent office of Parliament, in your opinion.

[John Wiersema]

Mr. Chair, the Office of the Auditor General did not do any audit work with respect to the severance arrangements with the former Integrity Commissioner. Therefore, I have no comment to offer in that respect.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

Thank you very much.

The second question I have is with respect to section 10.28, “Expenditures of Ministers’ Offices”. In particular, I was looking at the Minister of Citizenship, Immigration and Multiculturalism. His expenses tend to be relatively high compared to other ministers and their departments, particularly with personnel, information, and also with respect to utilities, materials, and supplies.

With respect to that, can you help explain to me particularly column 3, where it says “Information”? What does that pertain to? What does that cost entail, and why is that cost so high?

[James Ralston]

I'll ask Mr. Matthews to respond.

[Navdeep Bains, Liberal, Mississauga—Brampton South, ON]

Thank you.