Evidence of meeting #149 for Government Operations and Estimates in the 44th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was program.
A video is available from Parliament.
Conservative
Stephanie Kusie Conservative Calgary Midnapore, AB
Thank you, Chair.
Thank you, Mr. MacDonald, for being here today.
Could you please provide the committee with a list of the grants and contributions reviewed for this audit, the companies they were awarded to, the amount of money awarded and the purpose of the grant or contribution?
October 29th, 2024 / 11:35 a.m.
Director General, Chief Audit and Evaluation Executive, Department of the Environment
I can provide that information to the committee.
Conservative
Stephanie Kusie Conservative Calgary Midnapore, AB
I appreciate that.
Mr. MacDonald, when this committee heard from Treasury Board officials on this issue, they continually stated that it's up to the deputy heads to ensure that their department is up to standard and that the mandate of their program is met.
Do you think that the deputy minister of ECCC has properly ensured that his department is running efficiently?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
I believe, as I mentioned in my opening remarks, that the deputy minister has made the grants and contributions one of his top priorities, and the implementation of the 17 recommendations of that DG committee is a top priority as well as the five recommendations that we made in our audit report.
In fact, reflecting on this, I think this is one of the times in my 20-something-year career as an internal auditor when a deputy minister has made a decision to put in place a team that is solely focused on implementing recommendations coming from an internal audit.
I think the commitment is there to really look at this system and make it better, make sure that the controls in place are solid and that we have an information system that will support decision-making.
Conservative
Stephanie Kusie Conservative Calgary Midnapore, AB
I'm hearing in your response, then, that you feel as though the deputy minister has taken upon himself the responsibility to see the good overview of this program.
In that case, is the program impossible to run properly, in your opinion, because of the insistence of Minister Guilbeault that his department issue hundreds of millions more in grants than its capacity allows? Do you think he was just pushing through these millions of dollars to be distributed on his initiative—that it was his force, his will, that created this level of error and incompetence?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
Well, as you know, public servants use their Treasury Board submissions to get program approval, and in your program approval documentation you do identify the list of resources that you require in terms of the people and the operating money so that as the decisions are made by Treasury Board, they give the department the resources.
We did an audit of classification in our department a few years ago, and it takes time to.... Once a program is approved, the money just doesn't come instantly and the program can't get up 100% on day one, so there's a period in time when you have to classify positions and hire the people, and as this committee has seen in the past, the time needed to staff a program is an issue in the government. It takes time to hire people.
The resources are provided through the submissions, through the budget process, and it's up to the department to implement it.
Conservative
Stephanie Kusie Conservative Calgary Midnapore, AB
It's sounding, then, like it even goes beyond Minister Guilbeault and goes all the way up to the Prime Minister.
Do you think that the Prime Minister, and with him the Minister of Environment, Minister Guilbeault, should consider the actual capacity of a department's resources before they dump hundreds of millions of dollars to them to just roll out programs?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
As I mentioned earlier, the departmental officials are really the ones who identify the resources required to implement the programs.
Conservative
Stephanie Kusie Conservative Calgary Midnapore, AB
Is the deputy minister able and comfortable, do you believe, to bring his concerns from this audit to the minister and the Prime Minister?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
My role is really as an independent person in my department to talk to the deputy minister, and it's up to the deputy to express his concerns to the minister and thePrime Minister.
Conservative
Stephanie Kusie Conservative Calgary Midnapore, AB
As the auditor, do you believe that this program is sustainable with its lack of clear standards, the mismanagement of documentation and the granting of millions without a proper justification, or does it need space and time to fix these issues and allow the department to fulfill its mandate?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
Well, I believe that the processes are in place, and we didn't just look at one program here. This is actually the management control framework that is in place to support delivery of all of our programs, and I believe that the actions being taken are going to support the delivery of those programs.
Conservative
Stephanie Kusie Conservative Calgary Midnapore, AB
I've looked through many of the grants and contributions that ECCC has distributed, and there are many examples of multi-billion-dollar corporations receiving millions from this program.
We have Glencore receiving $10 million; over $18 million being received by Rio Tinto specifically, which has a market cap of $103.549 billion U.S. as of last year; and, of course, Cornell University, a university that isn't even within Canada, receiving funding.
Are there any clear standards in place to ensure that businesses that are clearly able to fund their own interests are not receiving grants and contributions from Canada, especially at a time when Canadians are suffering as a result of the overspending of this government?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
Our internal audit looked at the processes that supported the delivery of these programs, and we didn't find any instances of terms and conditions not being met in the funding decisions.
Funding is provided to eight different types of recipients, including not-for-profits and going all the way up to those types of corporations. It is done for specific purposes in accordance with the policies that have been developed.
Conservative
Conservative
Liberal
Irek Kusmierczyk Liberal Windsor—Tecumseh, ON
Thank you so much, Mr. Chair.
Thank you so much, Mr. MacDonald, for being here with us today.
This Liberal government is making historic investments in the environment and in fighting climate change. We've seen hundreds of millions of dollars to leverage the tremendous work that is being done by environmental organizations, business organizations and other organizations across Canada. We've seen that work in action in my community of Windsor—Essex.
About two weeks ago, I had a chance to join about 30 to 40 community stakeholders to announce roughly $78 million for the restoration and protection of the Great Lakes in my community. This was the single largest federal clean water restoration investment in the history of Canada, and it took place in my backyard in our community of Windsor—Essex.
This allows us to leverage the tremendous work that is being done on the ground by organizations like the Great Lakes Institute for Environmental Research, the University of Windsor and the Essex Regional Conservation Authority, among many community partners that protect the Great Lakes and their environment.
Sir, I would much rather have this conversation that we're having here with you today about how we strengthen the grants and contributions program at ECCC than have the conversations we were having when the Conservatives were in office. They had completely gutted environmental efforts and environmental protection from top to bottom. They eliminated hundreds of millions of dollars, cut hundreds of millions of dollars to Environment and Climate Change Canada and fired hundreds of dedicated public servants who were protecting the environment and working to fight climate change. I'd much rather have this conversation that we're having about strengthening the grants and contributions program.
On that note, I want to ask you about the independence of the internal audit function. My colleague raised a question about that earlier, and I want to ask you whether can you talk about the unrestricted access that you have in terms of records, in terms of witnesses and in terms of talking to staff when you are doing your job of auditing as the chief audit executive. Talk about the unfettered access that you have.
Director General, Chief Audit and Evaluation Executive, Department of the Environment
As I mentioned earlier, we have an internal audit charter that is reviewed every year by the departmental audit committee and approved by the deputy minister. This gives us access to all the records and individuals we need, but if I feel that my independence is being impeded, I have a few avenues where I can go. I can talk to the comptroller general of Canada and raise issues or concerns that I have. If there are departmental officials who are not giving me the information I need, I can work with them collaboratively, and if that doesn't work, I can use the charter to get the documentation through the support of the deputy minister.
Liberal
Irek Kusmierczyk Liberal Windsor—Tecumseh, ON
In your work, did you find that there was any friction or any opposition in your ability to conduct unfettered interviews and get unfettered access to documents?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
I did not have any impediments in conducting this work.
Liberal
Irek Kusmierczyk Liberal Windsor—Tecumseh, ON
As the auditor, how is the auditor himself or herself audited as well? Can you talk a little bit about that?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
Yes. In accordance with the internal audit standards, every year I have to have an internal quality review of the work that we do. This is done by a professional practices team in my function. Once every five years, we have to have an external review of the work that we do to make sure that we're following the standards.
What they will do is take a sample of some of the audits that we did and look at how we did our work, if we concluded against our objectives, if the team was independent and objective and whether the team had the proper training to do the work.
Liberal
Irek Kusmierczyk Liberal Windsor—Tecumseh, ON
That's excellent.
In your earlier statement to the committee, you stated, “I believe that the department has put a robust management action plan together to address the audit findings and recommendations.” Can you tell us in your own words how satisfied you are with the response of ECCC and this department to the recommendations and findings that you brought forward?
Director General, Chief Audit and Evaluation Executive, Department of the Environment
As I mentioned, having been in this area for about 20 years, I believe that this is the first time I've seen a deputy take it very seriously and put in place a dedicated team to address the recommendations and to work on the action plan.
Some of them are going to take time. Developing a new system is not going to happen overnight, but I think that the steps are in place to strengthen information management practices and achieve that departmental enterprise vision, which has been lacking, as the deputy mentioned. A lot of areas are doing work in silos, and there's a lot more room we can make for coordination and collaboration.
I think once those things are in place in the system—the enterprise vision and the information management practices—they will go a long way toward strengthening the administration of these programs in our department.
Liberal
Irek Kusmierczyk Liberal Windsor—Tecumseh, ON
Sir, your work has come at an important time, an inflection point, an important time for ECCC, and I thank you so much for your work, dedication and rigour. Thank you very much for your testimony today.
