Finance Committee on Nov. 3rd, 2014

[Gerald Keddy, Conservative, South Shore—St. Margaret's, NS]

That's fine.

[The Chair, Conservative, James Rajotte]

Thank you, Mr. Keddy.

We'll go to Mr. Rankin for seven minutes.

[Murray Rankin, NDP, Victoria, BC]

Thank you.

Thank all of you for coming. Mr. Fréchette, welcome again.

I would like to ask you about your August report entitled “Analysis of Performance Budgeting During Recent Fiscal Consolidation”. It seemed to reveal that the government is cutting programs regardless of how well they work. Not only did it find no relationship between the performance by a department and its budget growth but it also found evidence, it seems to me, that important financial resources are being taken away from successful programs and transferred to non-performing programs.

According to your findings, what is the government's success rate in meeting its own performance objectives?

[Mostafa Askari]

The expenditure management system, which is under the control of the Treasury Board Secretariat, was established to ensure that the spending by programs provides value for money. Because of that, there is a system in place that each department and agency has to provide indicators for the performance of their programs and then at the end of the year they have to assess to what extent they have achieved those objectives.

What we did in our report was look at over a three fiscal-year period the performance of all those programs, their objectives and what they showed they achieved at the end of the year, and then we tried to match that with the changes in the budget allocation for those programs. The idea was to see whether the expenditure management system and the performance measures are actually used for allocating funds to different programs.

What we found was there was no real correlation between the performance of the programs and the budget allocations, budget cuts or increases, in the following year.

[Murray Rankin, NDP, Victoria, BC]

It also seemed that you found about 44% of the programs didn't have enough data to measure their success or failure. Is that so?

[Mostafa Askari]

That's correct. A large number of programs do not actually provide enough information on their performance, or they change the performance criteria during the year so it would be very hard to actually measure the performance at the end of the year.

[Murray Rankin, NDP, Victoria, BC]

Building on what my colleague, Mr. Chan, said, it seems to me this points to a larger problem about the failure of the government or refusal to provide adequate data to you to do your job. That would seem to be pretty self-evident, based on that.

[Mostafa Askari]

We didn't request that information. That's information that's supposed to be tabled every year by the departments in their performance reports, and some of those programs do not have the information that is required.

[Murray Rankin, NDP, Victoria, BC]

I'll come back to that, if I may.

Turning to something different, did your medium-term analysis of the report on fiscal management take into account the costs of the mission in Iraq?

[Mostafa Askari]

No, we have not done that yet.

[Murray Rankin, NDP, Victoria, BC]

I'll go back again to information management. Six months ago the Federal Court strongly upheld the right of your predecessor to take the government to court should it refuse to provide requested information. It was recently reported that you were still struggling, Mr. Fréchette was struggling, to obtain information on the impacts of the massive spending and staffing cuts announced more than two years ago, and you were thinking of going back to court to obtain that information.

Could you update this committee on the status of those efforts?

[Jean-Denis Fréchette]

On the efforts of getting the information for the budget 2012, we are basically at the same status. In August 2013 there were requests for access to information under ATIP that were made, which did not work very well for various reasons. That is not an approach that is very effective.

As I mentioned before to another question, not specifically in that context but in some other cases we are developing bridges and we are developing approaches. Eventually when.... And I understand—I was about to say “your frustration”, but I would use the French word, exaspération—

[Murray Rankin, NDP, Victoria, BC]

That's the right word.

[Jean-Denis Fréchette]

—which, believe me, I share with you. When I get exasperated enough, eventually going back to court is not off the table.

[Murray Rankin, NDP, Victoria, BC]

But, Mr. Fréchette, in reply to Mr. Chan, you used the expression “55% of the information we feel entitled to”. Those were your words. It's not your entitlement, it's the law that requires that, and the government is not obeying that law.

[Jean-Denis Fréchette]

Absolutely. In some cases, a department makes an assumption that it's because we don't ask specifically for economic and financial data. The department, DND—and I mention it because it's public—specifically said it's outside the scope of the mandate. We dispute that.

[Murray Rankin, NDP, Victoria, BC]

Let me talk about the CRA. You have an MOU with the CRA to analyze the tax cap. I think you talked about that. We introduced a motion in the House that would have required the Conservatives to give your office the information to measure the tax cap. The government voted down that motion. Can you tell us about your efforts to measure the tax cap, and about this MOU?

[Jean-Denis Fréchette]

You're right, an MOU is under discussion. We're still negotiating with CRA because we want to make sure that it's going to be not only an MOU for that specific tax cap, which is important because we received two requests from parliamentarians who asked that specific question. We are now considering that the MOU is in the process of being negotiated, as I said. We want to have a long-term approach for the MOU. We don't want to have an agreement or a memorandum of understanding that would be specifically for this. We want something on a longer term. Eventually, if it doesn't work, as I said, when we lose hope, then we will have to move on.

[Murray Rankin, NDP, Victoria, BC]

Yes, I hope you do.

Very briefly, Mr. Mulcair, the leader of the opposition, introduced Bill C-476 that would create a status like that of the Auditor General for the PBO. Do you agree that strengthening the mandate in that way would be beneficial for your work?

[Jean-Denis Fréchette]

If it's the wish of parliamentarians to review the legislation, I certainly support whatever parliamentarians will—

[Murray Rankin, NDP, Victoria, BC]

Would it assist you in your efforts to have that level of independence?

[Jean-Denis Fréchette]

I'll give you the example, to circle back to the MOU, the Auditor General had to develop MOUs with departments to have access to information, and he's an independent officer of Parliament.

[Murray Rankin, NDP, Victoria, BC]

Thank you.

[The Chair, Conservative, James Rajotte]

Thank you, and thank you, Mr. Rankin.

Mr. Allen, you have seven minutes, please.

[Mike Allen, Conservative, Tobique—Mactaquac, NB]

Thank you very much, Mr. Chair, and thank you to our witnesses for being here. There are so many questions in so little time, seven minutes.

Mr. Fréchette, one of the comments you brought up was that growth was higher than expected. I have three questions on that. What are the key things that have driven that additional growth? What are some of the risks you see in the projections of that growth? What is driving the growth above the potential? You started talking a little about it in footnote 6 on page 7 of your “Fiscal Monitor”, but I'd like to understand a little more detail on that from your perspective.