Public Accounts Committee on Oct. 31st, 2011

[Michael Ferguson]

Mr. Chair, the first thing we will have to determine is which language each and every senior level person selects to work in. For anyone who selects French, we will make sure that there are mechanisms in place to fully protect that right. That will be absolutely protected.

[The Chair, NDP, David Christopherson]

Time has expired.

Mr. Dreeshen, you have the floor, sir.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you very much, Mr. Chair, and thank you, Mr. Ferguson, for being here today.

We had an opportunity to meet when you were in Quebec City for the national meeting of auditors general and public accounts committees. I'd like to go back to some of the things you've had to do with your own public accounts committees in New Brunswick. During your remarks, one of the things you mentioned is the trust that is required in order to make sure Canadians get the results they deserve from the Auditor General's office, and from this committee as well. Perhaps you could expand on the relationships you had with your provincial counterparts, and how you would ensure that relationships with our committee remained such that we'll also have that confidence, which seems evident from what we hear from so many people—colleagues—who have endorsed your nomination.

[Michael Ferguson]

I always had a good working relationship with the public accounts committee in New Brunswick. I tended to release my reports to a combined meeting of the public accounts committee and the crown corporations committee. I always had a good working relationship with those committees. I would deliver my reports to them. They would have the chance to ask questions about them, so I think it's a fairly similar situation as here.

In New Brunswick, the frequency of meetings for the public accounts committee is much lower than the frequency here, so that will be a change for me. As I said, it is important that the Auditor General and this committee have a good working relationship. What I will do to express that is bring any report forward to the committee, and clearly explain what the issues are in the report, so that the committee has a full understanding of what the report is.

As you said, I have been at various meetings of public accounts committees and auditors general, so I have gotten a sense of how different public accounts committees work across the country. They don't all work the same way. Spending some time reflecting on that might also provide some opportunities to bring some thoughts forward to the committee.

[Earl Dreeshen, Conservative, Red Deer, AB]

You spoke of the 360-degree analysis that you are able to bring to this particular office.

Perhaps you can expand on the insights that you and your audit team have, and where you should be digging, because you've been in all different parts of the spectrum.

[Michael Ferguson]

As I said earlier, I think the audit process is a rigorous process. It's a process that is designed around identifying what areas the audit team should be looking at, perhaps doing some scoping work at first to figure out whether it looks like that area really is one where there could be some significant or useful findings, and then going through the process to identify what improvements need to be made in the particular area.

My experience, as I said, has been one of being able to look at government from both the inside and the outside. For example, one particular insight is that within the government department, I know it's possible that not everybody has the exact same understanding of a particular issue—so you do have to make sure that, as an auditor, you are asking multiple people. The individual who is directly responsible may have one set of understanding about a situation, but in fact their supervisor may know something else or something more about that situation. Making sure that enough people are being interviewed to gather the evidence is one thing.

As well, as I said before, it has become quite obvious to me that there are many things inside a government that can be improved. Making sure that the auditors are asking the right questions and digging down to enough level of detail would be another learning for me in terms of the different roles that I've played.

[The Chair, NDP, David Christopherson]

Sorry. Your time has expired, Mr. Dreeshen.

Thank you very much.

Moving in rotation, we go to Mr. Caron.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you very much, Mr. Chair.

The lengthy notice of motion that I presented at the start, that I inflicted on the members here in the room and on the people watching on television, can be summarized easily. When we arrived in the House, after the May 2 election, 14 chapters of the report of the previous Auditor General had not yet been considered fully by this committee. The previous committee had done some work on seven of those chapters and they only needed to be presented again to get the government's response. For three of those chapters, we simply needed to wait for the committee to adopt the report to present them and get a response from the government. The committee still had work to do on three of them. There is also the matter of the 2010 Public Accounts of Canada report that has not yet been addressed by the committee.

I won't ask you for your opinion on the topics at hand, even though some of them were important. Among other things, we're talking about the cost overrun in the purchase of military helicopters. We're talking about the issue of the Public Sector Integrity Commissioner who had been fairly controversial. So there are important issues. I won't ask you for your opinion on those matters.

But I will ask you this. If you are appointed Auditor General and you need to present reports that may address important issues, what do you think the impact would be of seeing one of your reports ignored by this committee? I'm not talking about your work, but the quality of the government's response to those recommendations that wouldn't be considered by this committee?

[Michael Ferguson]

I guess, again, I'd have to know the situation better to give you a full response.

Certainly, the role of the Auditor General, as I understand it, is to present reports, make recommendations, and bring those recommendations forward. Then, as I understand it also, the Auditor General's office does do some work in terms of following up on some of those recommendations, to see whether government has implemented them.

Sometimes, in my own experience, if the New Brunswick government hadn't implemented some recommendations we felt needed to be implemented, we might go back and do a follow-up audit on the same area, for example.

Certainly, the role of the Auditor General is to bring the report forward, make the recommendations, and bring the report to this committee, so that this committee can then use those reports to ask questions of the government and to help hold the government accountable.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

Thank you.

Briefly, in less than a minute if possible, could you explain the differences you see between the two mandates? We know that the numbers are different and that the scope is different. Aside from the size of the numbers, could you explain the differences in the mandate between the role of auditor general of New Brunswick, a position you held for five years, and that of the Auditor General of Canada? Do you see a difference in the approach?

[Michael Ferguson]

Fundamentally, the roles are very similar. In fact, when I look at the legislation for the Auditor General of Canada versus that for New Brunswick, they're very similar. The scope is very similar—financial audits, performance audits, compliance audits, and special reviews. The main difference is that the federal Auditor General has the sustainable development mandate in terms of the environment.

[Guy Caron, NDP, Rimouski-Neigette—Témiscouata—Les Basques, QC]

I'm going to quote a passage that I'll read slowly. I know I tend to speak quickly and I want to make sure the interpretation is clear.

The site of the New Brunswick Progressive Conservative Party states that, last year, the auditor general [Mr. Ferguson] said that there was a $400 million deficit and that it would be better for New Brunswick if more people were working and paying less taxes. This year, the auditor general said again that the province was collecting too much tax and that the economic data did not justify higher taxes. Michael Ferguson said that he felt high taxes hinder the economy.

Did you make these comments as reported on the Progressive Conservative site?

[Michael Ferguson]

I certainly don't know the context of that quote. I would have to know. I don't remember making those statements.

I'm not saying—I don't remember making those statements.

I would have to see where that was quoted from to be able to make a comment on that.

[The Chair, NDP, David Christopherson]

Sorry, your time has expired.

The last speaker in rotation is our guest colleague, Mr. Warawa. Welcome, and you have the floor.

[Mark Warawa, Conservative, Langley, BC]

Thank you, Chair.

Mr. Ferguson, thank you for being here. I read your CV and was very impressed. The selection process for the next Auditor General of Canada has been a very thorough, national search, and I want to congratulate you on being nominated for this position.

Regrettably, there have been some who have prejudged your suitability for this position and even before you were here today said they will not be supporting you. As I said, I find that regrettable.

I'd like to focus on the selection criteria that was established. There were 28 points, and one of those was language skills. I too need to improve my French, but yours is far better than mine. I'd like to focus on those 28 points, so I'm just going to go through them quickly, and you can make comments on whether you see yourself as being suitable.

From the briefing and CV, it appears to me you are very qualified and very capable of doing audits, and would do a good job for this country, but the selection criteria begins with your having a degree from a recognized university, preferably from a university specializing in accounting. Do you have that?

[Michael Ferguson]

Yes, Mr. Chair.

Are we really going to go through all 28 of these?

[Voices]

Oh, oh!

[Mark Warawa, Conservative, Langley, BC]

Yes, Chair, I would like to do that because I believe Mr. Ferguson is very qualified, and some around the table, surprisingly, are focusing on only one of those 28 qualifications.

Are you a candidate who is a highly competent, seasoned chartered accountant and auditor?

[Michael Ferguson]

I believe so.

[Mark Warawa, Conservative, Langley, BC]

Thank you.

Do you have proven leadership and management experience at the senior executive level in large, complex, private or public sector organizations?

I would say yes.

[Michael Ferguson]

I believe so.

[Mark Warawa, Conservative, Langley, BC]

Do you have experience in auditing complex organizations, including audits and value-for-money audits in human resources management optimization?

[Michael Ferguson]

I believe so.

[Mark Warawa, Conservative, Langley, BC]

Do you demonstrate skills in strategic management and organizational change, particularly in circumstances where financial or human resource constraints are major factors?

[Michael Ferguson]

Yes.