Natural Resources Committee on June 20th, 2006

[Bradley Trost, Conservative, Saskatoon—Humboldt, SK]

So the period that's included is everything from 10 years back until June 15.

Again, I'd like a little bit more information, because you're so new to me.

Looking here at your statement, it refers to whether programs “are environmentally appropriate”. How do you define your targets? With government policies, some are more detailed, some are more vague, and some legislation's more explicit. So what sort of objective criteria do you try to use in a general principled way to decide what or what is not environmentally appropriate?

In my experience in dealing with agricultural problems in my riding, after DFO has done some ridiculous things to irritate my RMs and so forth, a lot of this strikes me as fairly subjective. I'm trying to understand how you can set some very objective standards, because there's a lot of opinion back and forth on what is and what isn't environmentally appropriate and sustainable.

[Johanne Gélinas]

That's a very interesting question, and I will look to one of my auditors or experts for that. In fact, they are all experts, but there are two who would like to answer your question.

Neil and John.

[Neil Maxwell]

Yes, I guess we all are anxious to talk about that.

The most important point is exactly what you've said, that as auditors, we base what we do on objective criteria; we don't make it up or we don't make up policy commitments, but take what the government has said. As your question points out, it is very much a challenge when we do our work.

There's a surprisingly broad range of places where we can find quite objective criteria. Often they are in the law itself, as the laws Parliament has passed often have quite explicit requirements of government departments. So that's one of the first places where we, as auditors, would look. Secondly, we would look at key commitments the government has made in its successive budgets and speeches from the throne. We've mentioned several times now the sustainable development strategy, which is often a very important place where we can find quite clear commitments from the government.

So it's really in that realm, where there are clear commitments, where we focus our work.

[John Reed]

I have just two very quick elaborations on that.

Often, as Neil said, criteria are derived from legislation or policies, and so on, but sometimes we have to create criteria. I can think specifically of the work we did for many years on the topic of environmental management systems. We took a position many years ago that departments had to have robust management systems in order to implement their sustainable development strategies. To develop the criteria for robust management systems, we did a lot of international work, making comparisons with various accounting offices, the International Standards Organization, and other organizations, and we came up with what we felt was best-in-class practice.

Then the second thing we do from time to time is benchmark against other jurisdictions. We have done benchmarking against European countries for particular work, or sometimes for best practices.

So it's a mix of things.

[The Vice-Chair, Liberal, Lloyd St. Amand]

Thank you, Mr. Trost.

We'll begin our third round, then, with Mr. Cullen.

[Roy Cullen, Liberal, Etobicoke North, ON]

Thank you, Mr. Chairman.

I think your office must be one of the best-kept secrets in Ottawa, and I gather I'm not the only one who thinks that. So I have a bunch of questions, but could you keep your responses short, because I only have five minutes.

You are an officer of Parliament, is that correct? I'm thinking about a multi-year performance audit, let's say, such as on climate change, and that covers many departments. You're obviously talking about these informal mechanisms that you have—and I'd be surprised if there weren't any—of information going back and forth to departments, so they roughly know what's coming. But as an officer of Parliament, you have to report to Parliament, and that's when it gets into the political domain. It's not always a question of simply facts and technical matters. Those might be feeding the political process, so parliamentarians need to have a handle on this as well.

So how do you decide? Do you have interim reporting? It's fine for the departments to know what you're saying, but parliamentarians want to know as well, so how do you decide when to cut it off and do an interim report, etc.?

[Johanne Gélinas]

We do a couple of things.

First, we're at the end of a cycle. Six years ago we developed a long-term strategic plan for the upcoming audit work that we were going to do. At that time we consulted with MPs, to get their views.

I should just open a bracket for a second to let you know that we're going to do that again in the fall. We'll consult you on an individual basis to see exactly what your concerns are and to see if we will address them in the long run.

I have only one report per year, which is tabled before Parliament. I have to tell you that climate change is an exception in the sense that for the first time the whole report is devoted to climate change. Usually we'll cover different topics and report on those. We always give you a flavour, without getting into the details, of the upcoming report a year ahead of time.

So in the fall we will be in a position to give you a pretty good idea of what topics will be covered by the 2007 report.

I don't know if that addresses your question.

[Roy Cullen, Liberal, Etobicoke North, ON]

Roughly. I'm just trying to make the point that the more frequently you can report back to Parliament, the better. On some of these public policy issues, different political parties could go different ways.

I have a few more questions. I'm going to throw a few of them out, and perhaps you could comment.

The Auditor General is an officer of Parliament as well, of course, and I wonder if you have any protocols with them. I'm trying to think of examples. Let's say they were doing the work in the area of ethanol. You're not ready to release your report, but you've obviously reached some conclusions. They might be doing an audit of NRCan, on value for money or something. It seems to me that it might be in some cases appropriate that information be shared, even though Parliament has not been fully informed, because you're both officers of Parliament. I'm just curious if you have any protocols there.

Second, on the performance audits, how do you establish which audits to do? What priority-setting process do you have?

Finally, I'm a little puzzled with these petitions. The petitions come in to you. You say here that the ministers respond, but wouldn't you have a responsibility or an obligation to make sure that the minister or the department has responded fully and completely? As well, are there any frivolous petitions that you would sort of discard? What obligation do you have to a petitioner to respond that you're not going to be doing any more work on this, or the department won't be, etc.?

[Johanne Gélinas]

I will go with your first and third questions, and I'll let John talk about the process.

We are an integral part of the Auditor General's office, and we work with all the other groups of the AG. For example, on an issue like oceans strategies, this audit has been done partly by the group responsible for the entity of Fisheries and Oceans and by us. If there's an issue where we have the expertise in part, and a group in the AG has the other part of the expertise, we work together.

When we do the planning, if there's an issue that my colleague from the Department of Foreign Affairs would like to look at, and we can organize our work plan in such a way that we can work together, that will be our priority.

So we're not a stand-alone piece within the AG's office, we are an integral part of the AG's office. We work together, we borrow resources, we lend resources--we work as a family, clearly. It's not an issue at all for us to know what's going on elsewhere and for them to know what's going on in my shop.

With respect to the petitions process, I haven't seen, honestly, any petition that I would qualify as frivolous. Very thorough petitions concerning specific issues related to environment and SD are all worth answers from the government. So that's not an issue at all.

Overall, when you think that anybody can petition us, we don't receive that many. We have an average of 40 petitions per year, which is not that many.

We will not indicate to a department what their response should be. We just have to make sure from our end that the question has been properly addressed. We won't comment on the response a department gives to a petitioner. If a petitioner is not happy with the response, he or she can always use the petitions process again and come with a more straightforward question, or a different question, to get his or her answer.

At the end of the day, the petitioner may not be happy with the answer, but there is nothing we can do about that.

[Roy Cullen, Liberal, Etobicoke North, ON]

And the priority-setting for performance audits?

[Johanne Gélinas]

Oh yes. Go ahead, John.

[The Vice-Chair, Liberal, Lloyd St. Amand]

In fairness to all parties, Mr. Reed, perhaps you would be fairly brief. You'll have an opportunity to wrap up later.

[John Reed]

Very quickly, we're in the process of writing our long-term five-year plan. To set priorities, we consider the risks, inside Environment Canada, to the achievement of their objectives. Do they have the right people? Do they have the right skills? Do they have a sufficient budget? Do they have good systems? So those are entity-based risks.

We get a handle on environmental and health-based risks, what's happening out there that affects people. We consider the materiality, the amount of resources attached to the programs, their significance, our past work, and emerging issues.

We bundle all of that together, and risk is the driving force behind all that work. We try to pick the issues that are most important to Canadians and the federal government.

[Johanne Gélinas]

It's important to add, Mr. Chair, that we also audit petition responses. If there is a commitment in a response, the department knows that we may come and audit that commitment. That puts a little bit more pressure on the responses.

[The Vice-Chair, Liberal, Lloyd St. Amand]

Thank you.

Mr. Allen, please.

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

Thank you, Mr. Chair.

Thank you to the witnesses for being here.

I have one quick question with respect to expectations for the fall audit that we'll receive in September.

Looking at the working draft of your SDS audit 2006, do I assume correctly that in your SDS commitments inventory listed for Natural Resources Canada you will be reporting on all these actions individually, and will have a report card on each one of those?

[Neil Maxwell]

Not every single one; there are so many commitments made by departments--we cover more than 30 departments--we take a selection. We will be reporting on a selection of those, and we will be commenting on whether the progress has been satisfactory or unsatisfactory.

If I may, Mr. Chair, I'll add a quick other point in terms of an earlier question. One of the questions that have come up several times is regarding the fact that we share information with departments prior to the time that we table a report in Parliament. I just want to make it clear that this isn't because we think the departments are a more important audience. Parliament is clearly our client. The reason we do that sharing of information with the departments is simply because that's a required part of our audit process. We can't complete a report until we've verified the facts with the department.

Inevitably an audit is very much a discussion back and forth with departmental officials. That's why they're privy to that information prior to parliamentarians being privy.

Thank you.

[Richard Arseneault]

As well, we are part of the Office of the Auditor General, so we apply the same methodology. We follow the exact same methodology. The experts at the Office of the Auditor General help us when we do our audits as well.

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

You've led me to my next question. It would seem to me, then, that departments should have the data collection and the systems in place that would allow them to report on these things annually. Here we are, ten years, and we're looking at something over that time. Departments should be able to get the information to be able to take corrective action.

Have you found generally--without saying too much here, I suppose--that the control and heads-up mechanisms are in place? Do you plan to make any such recommendations in those areas?

[Johanne Gélinas]

We have looked at that--I cannot tell you more--and we'll make recommendations. In the past, we've recommended that we have good information-gathering with respect to climate change. We have made recommendations with respect to that in the past. We will report back, because we have done a follow-up on that.

[Neil Maxwell]

More generally, beyond climate change, that's a very important question. One of the concerns we've had for a number of years is how well departments are in fact telling parliamentarians how well they are achieving those commitments. There is information provided by some departments in parliamentary documents--the estimates documents, for example--but the quality varies considerably.

Something that we often urge parliamentary committees to do is to pose exactly the question you've posed to the departments, to get a clear reporting on how well they've met those commitments.

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

Having done audit work myself, I know that you hit samples. My concern is that we're just not going to see the total picture unless the department does that on a yearly basis.

[Richard Arseneault]

NRCan used to produce, at the end of three years, a progress report on its performance against what it had committed in SDS. I don't know if they're going to do that anymore, but they used to do that.

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

Finally, when I look at your SDS III commitments summary table, I find it very striking the number of departments that have only minor commitments or none. I'll use the Atlantic Canada Opportunities Agency as an example.

Should we expect to see other departments come to the table more, with more of these commitments? What would be your expectation there?

[Johanne Gélinas]

Absolutely. There's no doubt in mind.

You will be the first committee, to my knowledge, that will pay more attention to the commitments made in the departmental SDSs.