Thank you, Mr. Chair.
I sincerely want to thank the committee for the invitation to participate as a witness in your review of the process for considering estimates and supply.
I guess I'm one of those rare people who actually really likes estimates. I've studied them extensively. The fact that the committee has taken this on.... I think it's a very important subject, and I think there are a lot of good, solid recommendations the committee could propose to try to move us to a better place.
By way of introduction, I was a former member of Parliament. I served as parliamentary secretary to the Prime Minister as well as parliamentary secretary to the President of the Treasury Board, and I was also director of parliamentary affairs at Treasury Board.
I can now confess that it was only in these last two capacities, when I worked with Treasury Board, that I obtained any sort of relevant understanding of what the estimates process was and how it fitted within the larger public sector financial cycle. I wouldn't want to admit publicly that for the first five years of my tenure, I voted in the estimates process without having a clue as to what was going on, but that was in fact the case.
Although the transparent presentation of financial information by government has many uses and many users, I want to focus on the role of the parliamentarian in oversight of government spending.
The supervisory authorities of the Canadian Parliament have evolved over time. They are a combination of practice, precedent, and statutory definition, so we're not really drawing on a single solid foundation; it's the way that these things have evolved. As a result of that, the Government of Canada is legally subservient to the Parliament of Canada because of two fundamental supervisory constraints: the confidence convention and expenditure approvals.
The confidence convention holds the Prime Minister and cabinet responsible, and they must answer to the House as a body for their actions and must enjoy the support and confidence of the majority of the members of the chamber to remain in office.
On expenditure approvals, authorities require the government to make its financial requirements known to Parliament, which must authorize the instruments used to raise the money, which we call ways and means, in the granting of necessary funds, which we refer to as supply. Therefore, there is a legal foundation for this. It isn't something that the government thinks is a good idea; they legally are bound to undertake certain actions. No tax may be imposed or money spent without the consent of Parliament.
Now, clearly the mechanisms exist, and we can find recent examples of their application. The government of the 39th Parliament fell as a result of a non-confidence vote, and a number of years ago the opposition—John Williams, my good friend—was successful in reducing the estimates by an amount equivalent to what was spent on a poll that was determined to not be in the public interest, so the process works.
I think, however, that any objective analysis would conclude that not only are these situations rare, but their successful application is almost exclusively tied to the government being in a minority situation, so one of the first questions that I think we need to ask ourselves, if we're serious about reviewing the existing process, is just how real the challenge function of the expenditure approval process is as an oversight mechanism for members of Parliament, especially in majority governments. Keeping in mind that testimony is the weakest form of research, I'll offer my own view, which is that I think the existing process is not a very effective one.
Members of Parliament work in a partisan environment. Any process that's thrown into that arena will inevitably align with existing power equations, and the result will never reconcile with the original objectives.
Governments will defend their interests, and majority governments will defend their interests in a manner that sometimes appears to be working at cross-purposes to democratic oversight.
Therefore, my first suggestion would be to shift our thinking on the objective. The estimates and supply process is a terrible, partisan mechanism for trying to embarrass the government, but it could be a very useful mechanism if MPs saw it as a way to improve the effectiveness and efficiency of government operations.
As MPs, you are literally on the front line when it comes to Canadians' view of government services and program delivery. The Standing Orders define any number of tools you can incorporate into your partisan strategies.
I'd suggest that we accept the role government has in setting policy and see the estimates process as a vehicle for MPs to apply both their unique skill sets and their unique perspectives to the oversight of government operations within the policy parameters set by the government of the day—in other words, view the estimates and supply process as a study of “how”, not a study of “why”.
The next challenge I think we face is the sheer scope and scale of the information that's presented in the documents. This was touched on a little bit by the previous witness.
For example, the 2011-12 main estimates total $261.2 billion in proposed government expenditures. That's presented by each reporting agency in a 473-page document. That works out to $552 million a page. When we add the public accounts documents and the RPPs and DPRs, sheer volume of information makes this at best a needle-in-a-haystack exercise and at worst an unfathomable intellectual quagmire that is best avoided entirely.
I should add at this point that I'm not being critical of any participant in the process. During my time at Treasury Board I've seen first-hand the extraordinary efforts behind the production of the estimates and the collection and collation of department performance reports and reports on plans and priorities.
On this format issue, I'm not sure how helpful I can be to the committee, but I would suggest we consider a few things.
First, consult the private sector. The presentation and processing of financial information is a critical element, especially in the financial services industry. Money doesn't talk, it swears; the people whose livelihoods depend on understanding numbers have figured this out, and there should be elements that are transferable to the public sector.
Second, examine the opportunities that technology presents to help manage the volume. MPs and Canadians should be able to access online analytical processing tools or data cubes that allow for multi-dimensional extraction and analysis of data to increase understanding of government operations.
Third, look at baselines and benchmarks. To effectively perform their oversight responsibility, MPs need high-level information. This should be augmented with clear, comparable calculations that allow for reliable ratio analysis, both for departments over time and for efficiencies between departments. With limited hours to devote to the study of estimates, it strikes me that any techniques that can highlight exemptions and anomalies would be useful.
Fourth, the current estimates process involves three documents. Departmental performance reports outline the actual spending from the previous year and reconcile it back to the approved authority. Reports on plans and priorities are narratives that outline departments' intentions for at least the next fiscal year. The estimates themselves list the projected spending of each reporting department and identify the specific authorities that need to be approved by Parliament, what we refer to as “votes”. Both the DPRs and the RPPs make extensive use of program activity architecture and strategic outcomes, and I agree with the previous witness that those documents present information in a very useful way.
The estimates make use of input costing data and don't really correlate the votes to the strategic outcomes, which really is the only measure of efficiency and effectiveness. When we add to this the lack of synchronization between the timing of the estimates and the timing of the budget, trying to get a handle on the big picture is even more complicated.
The committee might want to liaise with the Public Sector Accounting Board to ensure consistency when considering reporting formats across departments.
If it is true that we measure what we value and we value what we measure, the only conclusion I can reach from the current process is that we value measuring. It's almost as if the process of getting the correct numbers into the proper voted statutory non-budgetary and budgetary categories has become the sole object of the exercise, and everyone assumes some oversight requirement is being met.
Returning to the objective, Canadians want to know what government is doing. They want to know where their money is being spent and whether or not they're getting value for that money. Anticipating the use of the data might be helpful in presenting it in a form that is much more understandable.
Again, I want to thank the committee for the opportunity and I look forward to the subsequent discussion.