Bill C-2 (39th Parliament, 1st Session) Committee on May 30th, 2006

[The Chair, Conservative, David Tilson]

Good evening. This is the Legislative Committee on Bill C-2, meeting number 15.

The orders of the day, pursuant to the order of reference of Thursday, April 27, 2006, are for the study of Bill C-2, An Act providing for conflict of interest rules, restrictions on election financing and measures respecting administrative transparency, oversight and accountability.

Monsieur Sauvageau, you have a point of order.

[Benoît Sauvageau, Bloc, Repentigny, QC]

Sorry for interrupting, but I have a question for clarification. If you deem it to be out of order, I will not contest your decision. I do not wish to debate the motion tabled by Mr. Martin right now. The question I want to ask you...

[The Chair, Conservative, David Tilson]

Excuse me, did you say Mr. Martin's motion?

[Benoît Sauvageau, Bloc, Repentigny, QC]

I do not want to discuss it, I wish to ask a question.

The deadline for the tabling of amendments is Friday. Perhaps the clerk might help you answer my question. How much time does the law clerk need...?

[The Chair, Conservative, David Tilson]

That will be discussed tomorrow at the subcommittee meeting at 12:15. I look forward to seeing you there.

[Benoît Sauvageau, Bloc, Repentigny, QC]

Very well. Thank you.

[The Chair, Conservative, David Tilson]

Ladies and gentlemen, we have a bit of a problem, as some of you may have heard if you were in the other room. We have a vote at 6:40. It's being proposed that this meeting go until 6:30, and I guess you'll have to come back whenever the vote is over for us to hear the rest of your presentations. I'm sorry to put you through that, but we have no control over the votes in this place.

We have three groups. We have, from the Canada Foundation for Innovation, Eliot A. Phillipson, president and chief executive officer; and Suzanne Corbeil, vice-president, external relations. From Canada Health Infoway, we have Michael Sheridan, the chief operating officer. From the Canada Millennium Scholarship Foundation, we have Norman Riddell, who is the executive director and chief executive officer; and Andrew Parkin, who is the director of research and program development.

Good evening to you. As you may know, you may make brief comments at the outset, and then there will be questions from the committee. Thank you very much for coming.

I don't know who wants to go first; you could flip a coin. Or I'll say who goes first.

Mr. Phillipson.

[Dr. Eliot A. Phillipson, President and Chief Executive Officer, Canada Foundation for Innovation]

Merci.

The Canada Foundation for Innovation is committed to the principles of accountability and is comfortable with the broad objectives of the Accountability Act. It's difficult at this time to comment in any detail on the implications for CFI of Bill C-2, given its complexity and its breadth, but I would note that the CFI has always acted within the spirit of the legislation that the bill addresses.

By way of background, the CFI was created by an act of Parliament in 1997 as an independent corporation. The funding agreement between the CFI and the Government of Canada, approved by the Treasury Board, sets out the terms and conditions under which the CFI must operate. The CFI is governed by a board of directors that sets strategic objectives in the context of the funding agreement and makes the final decisions on projects that are to be funded, based on a rigorous merit review process.

As such, our key concern will be to ensure that Bill C-2 does not inadvertently jeopardize the integrity of the merit-based awards system that is fundamental to CFI's mandate.

The CFI has numerous accountability measures already in place and incorporates the principles of accountability into every facet of operations. For example, our annual report is tabled in Parliament through the Minister of Industry, and it includes information not only on financial performance but also on funded projects, evaluations, results, and corporate plans. The CFI submits to the minister the results of independent third party evaluations of its programs to assess its overall performance in achieving the national objective identified in the agreement. The CFI submits to the minister an annual corporate plan that includes planned expenditures, objectives, and performance expectations.

From its inception, the board has taken prudent measures to ensure sound accountability and governance practices. We have implemented a strong internal control environment to carry out our activities. These controls are widely accepted in the business community and among the public and are reviewed by external auditors. Moreover, independent audit firms conduct contribution audits of the funded projects to ensure the proper use of public funds.

With regard to access to information, the CFI promotes an open and transparent approach to communications, with a focus on information sharing while respecting the privacy of its client institutions and their researchers.

We have adopted a policy on privacy and access to information that provides a right of public access to information and is subject to only a few necessary exceptions to protect the personal information of applicants and reviewers, which is critical to the integrity of the merit review system.

In conclusion, as was stated in budget 2006, “Foundations have become important vehicles for implementing policy, particularly in areas such as research and development...where expert knowledge, third-party partnerships...and peer review are especially important”.

The key concern, from the perspective of our board of directors, is the need to ensure that Bill C-2 does not jeopardize the very nature of the foundation and the principles on which it was created. The foundation governance model has allowed CFI to be efficient, accountable, transparent, and flexible enough to adapt to the emerging needs in a very highly competitive global research environment.

Thank you. Merci.

[The Chair, Conservative, David Tilson]

Thank you, Mr. Phillipson.

Mr. Sheridan, from Canada Health Infoway.

[Michael Sheridan, Chief Operating Officer, Canada Health Infoway]

Mr. Chairman, Members of the Committee, I am pleased to be here this evening. The Canada Health Infoway is unique. Its aim, through its mandate and its structure, is to promote the development of electronic health records in a pan-Canadian context, so as to improve the quality, access and productivity of our health care system.

Infoway was established as an independent not-for-profit corporation as set out under the Canada Corporations Act. Infoway is not a parent crown corporation or a wholly owned subsidiary of a parent crown corporation or an agent corporation. Infoway reflects a collaborative model, which is defined in its governing body membership, its board of directors, and its joint strategic investor role and structure.

Infoway's investment model is designed to foster collaboration with all jurisdictional stakeholders while ensuring reuse, high replication, and leverage of the funds that are invested. As a strategic investor, Infoway co-invests on average 75% of eligible costs for electronic health record projects. Infoway uses a gated funding mechanism so that no money flows until key milestone deliverables are achieved. It is the provinces and the territories that are responsible for the longer-term maintenance and operating costs; hence they have a huge stake in the development and implementation of these systems.

Canada's 14 federal, provincial, and territorial governments, represented by their deputy ministers of health, are the corporation's owners and, in a manner of speaking, its only shareholders. The cooperation and collaboration of each member is required on an equal basis. While each member has an oversight role in Infoway, no individual government has a priority oversight role. Infoway's strong accountability regime reflects our multi-government structure and ownership. It includes an annual independent compliance audit to ensure conformity and adherence to specific terms and conditions of our funding agreement, which is submitted to all members; an annual independent financial audit, which is made available to the members and to the public; an annual report, which has been tabled in the House, that tracks performance results and is provided to all members of Parliament, the Senate, and is available on our website along with our annual business plan, which is approved by the board of directors and presented to the members. In addition, a mid-term performance evaluation has recently been completed by an independent third party evaluation firm, and that extensive report was submitted to the members as well as being made available to the public.

In closing, as the Auditor General stated in her appearance here last week, changes last year to the Auditor General Act addressed her concerns about the audit access to foundations and this proposed legislation, which would expand that office's mandate to follow the dollar. Infoway members, board, and management also take following the dollar very seriously and have put in place a strong accountability framework with appropriate internal controls, processes, procedures, financial systems, external investment portfolio managers, external audit and performance evaluation mechanisms to account for all of our investment decisions and the tracking of expenditures of these investment dollars.

We would obviously seek to fully cooperate with the Auditor General in any audit activity that she might wish to initiate and hope that her office could and would build on the audit and accountability activities Infoway has already established.

Thank you.

[The Chair, Conservative, David Tilson]

Thank you, Mr. Sheridan.

From the Canada Millennium Scholarship Foundation, all the way from Vancouver, Mr. Norman Riddell.

[Norman Riddell, Executive Director and Chief Executive Officer, Canada Millennium Scholarship Foundation]

Thank you, Mr. Chairman. I am accompanied by Andrew Parkin, director of research at the Foundation.

The foundation supports the objectives of the Accountability Act, which it perceives to be enhanced public participation in the development and delivery of programs, and enhanced accountability for actions and spending, which we believe will lead to more efficient and effective use of public resources.

It also believes that accountability is a matter not only of action but also of perception. From the very beginning, the foundation has consistently gone beyond the reporting requirements of its legislation in order to provide the public and members of Parliament with a detailed account of its operations and opportunities to become involved in the development and delivery of its programs.

With respect to the accounts of our operations, of course we table an annual report in Parliament, but I would also refer members of the committee to our website, on which they can find an account of exactly where the foundation's money is going on a regular basis, constantly updated by the level of institution, province, or constituency. We also publish evaluations of our activities.

I also mentioned that we involve the public in developing the programs. Our directors and members are drawn from the broader community, we use citizen advisory panels for major programs, we conduct public consultations prior to all major initiatives, and we deliver many of our programs in partnership.

We believe that one of the most important effects of the proposed legislation will, therefore, be to enhance the perception of accountability by replacing the foundation's voluntary transparency with legislated transparency. Henceforth, the foundation will not only need to make its actions transparent, but it will also need to be in a position to demonstrate that it is prepared to do so in accordance with standards established by an external authority, the Parliament of Canada.

Meeting those standards will require some effort and will incur some costs. Having a small staff of 40 people, whose energies are primarily focused on delivering $340 million in student financial assistance to approximately 100,000 students a year, the foundation has, of necessity, engaged the services of consultants to help it understand exactly how the act will affect it, and to propose systems that will permit us to meet the requirements of the proposed legislation. We will be pleased to provide you with further information as we receive the report from the consultant.

However, I have a few remarks to make with respect to specific parts of the bill, if the chair would permit.

[The Chair, Conservative, David Tilson]

We're here to talk about the bill. Try to keep your comments to the bill, please.

[Norman Riddell]

With respect to the Conflict of Interest Act, in proposed section 2 there are two definitions that concern us, the definition of public office holder and the definition of reporting public office holder.

Depending on whether you consider that the honorarium the foundation pays to the members of its board of directors to be a salary or not, our GIC appointments to the board are either reporting public office holders or public office holders. There follows in the Conflict of Interest Act a number of restrictions on the activities of these people, both while they're on the board and when they leave the board, that may not have been intended, and we would be interested to get some clarification on that point.

With respect to the amendments to the Lobbyists Registration Act, the foundation is already registered as a lobbyist, and we don't see any difficulty in meeting the additional requirements in clause 69.

With respect to amendments to the Access to Information Act, we have always behaved as though we were subject to the Access to Information Act, but we do anticipate some difficulty in ensuring the availability of documents in both official languages, given that the foundation's practice internally has always been to have the staff members produce the documents in the language of their choice. Any dealings with the public, of course, are in both languages of Canada.

The other difficulty we may encounter is respecting the time limits with respect to meeting retroactive requests. We believe that the exemptions proposed in the amendments to the Access to Information Act will be useful. We need to protect the personal information of the some 500,000 to 600,000 students on whom we have files, and we also need to protect the information that we receive from governments in confidence and the material we use in negotiations with governments.

With respect to the amendments to the Privacy Act, the foundation is already complying with some 13 privacy laws--those of the provinces and territories. We don't anticipate any difficulty in protecting the information, although this bill will require us to post information on the databanks where we hold personal information, and as I mentioned, we have a lot of it. So additional effort will be required to inform the public about the nature of the information that we hold in our banks.

The Auditor General Act has also been amended and the Auditor General has in the last couple of weeks arrived at the foundation. We believe this is an excellent opportunity for the foundation to make the public aware of its achievements in flatlining student debt, beginning in 2000 in real dollars, contributing to a significant decline in dropouts in higher education among high-borrower students, and to show that the foundation has delivered $1.28 of student financial assistance for every dollar it receives from the taxpayers and has done so with a staff of 40 and overheads of under 7%.

[The Chair, Conservative, David Tilson]

That bell means time is up. If you could wind up, I'd appreciate it. Thank you.

If you have only a few more sentences, you may proceed.

[Norman Riddell]

In closing, we're pleased to participate in the government's effort to make it easier for the public and its elected representatives to understand the work of the foundation. We do not consider the additional requirements to interfere with our independence as a private government-financed charitable foundation operating at arm's length from government. We have been entrusted with a great deal of the public's money, and like any other foundation that takes money from donors, we have to expect to give an account of our stewardship to the public and to the elected representatives.

[The Chair, Conservative, David Tilson]

Thank you, Mr. Riddell.

There will now be questions from the four different caucuses. Each caucus has seven minutes for questions and answers.

Mr. Owen is first.

[Stephen Owen, Liberal, Vancouver Quadra, BC]

Thank you, lady and gentlemen. I'll raise a couple of points and then my colleague Mr. Tonks will raise a point.

First of all, I congratulate you all for the work you do. It's outstanding. In my experience in looking at public administration and public policy, your three organizations show accountability and responsibility and success toward your mandates, at the top of any list of public agencies I know of, and so I think you have to be congratulated for that.

Dr. Phillipson, in your very highly respected international peer review process, have you had challenges by unsuccessful proponents, and what is your record of dealing with that?

And while I have the microphone on, Mr. Riddell, I'm wondering about the privacy side of your operations. Thank you.

[Dr. Eliot A. Phillipson]

Thank you for the question.

We provide to the applicants a verbatim copy of the reports of the external experts and the committees that evaluate, but deleting the names or any reference to the identity of the reviewer. That's the integrity of the peer review system. It's a time-honoured system in research and scholarship, in publishing original research. The whole peer review system functions on the ability of the system to get a candid opinion from reviewers because they know their identity will be protected.

Yes, to answer your question, of course we've had challenges from unsuccessful applicants who might challenge and take issue with the substance of the review. It doesn't happen very frequently, but it still protects the identity of the reviewer.

That's our concern, because the current privacy legislation exempts individuals; our applicants happen to be institutions. So the addition of two simple words, individuals “or institutions”, would take care of our concerns.

[Stephen Owen, Liberal, Vancouver Quadra, BC]

Thank you.

My further comment, I was initially thinking, would be to Mr. Sheridan, but I value the answers of either of you on the privacy side.

Really, Mr. Sheridan, I was thinking of health information—

[The Chair, Conservative, David Tilson]

We'll let everybody speak.

Mr. Sheridan, and then Mr. Riddell.

[Michael Sheridan]

In terms of privacy, we have a privacy policy that we've instituted within the corporation itself. When we're dealing with privacy with respect to health records, it is the 14 different pieces of privacy legislation within the jurisdictions and the federal government that constitute the privacy issues around access to health records.

An EKOS poll two years ago indicated that 80% of Canadians believe electronic health records would indeed improve the delivery of the health care they got out of the health care system; however, they expressed some concerns. In the expression of those concerns they were very concerned about who would have access to their health information, under what circumstances that access would be granted, and whether or not they would have the ability to intervene with respect to correcting or changing their particular health care records.

Overall, in terms of privacy with respect to health records, Infoway has developed what would be an appropriate governance and architecture system for confidentiality and privacy around electronic health records that the jurisdictions could use in building those electronic health care systems.

[The Chair, Conservative, David Tilson]

Mr. Riddell.

[Norman Riddell]

Thank you.

As I mentioned, the foundation has personal information on between 500,000 and 600,000 students. That information can, depending on the program in which we're supporting the students, contain information about their financial need, their family income, their marks, the programs they're studying—it's almost a complete file on each student.

Some of the data we receive is transferred to us from the provinces. It is collected by the provinces for use in the administration of their own student financial aid programs and the Canada student loans program. There is, on the application form for Canada student loans and provincial student aid, a line that authorizes the province to transfer that data to us. The data belongs to the province, and we must use it in compliance with provincial privacy legislation. So we become subject to the 13 different laws of the provinces and territories.

We also collect information directly in a much smaller program—the merit program—directly from students. In that case, the information is governed by the privacy legislation of the province of Quebec, because that's where we're located.

In all cases, great care is taken to protect this information, given its sensitivity. That is one of the reasons why the foundation has never thought it correct to reveal the names of the people who win its bursaries, because revealing the names of the people who receive foundation bursaries would be the equivalent of publishing the list of the people who had the highest need in Canada, something we did not consider appropriate. It has been a matter of discussion between foundation officials and members of the House of Commons at different points.

[The Chair, Conservative, David Tilson]

Thank you.

Monsieur Sauvageau.