Public Accounts Committee on June 22nd, 2006

[The Chair, Liberal, Shawn Murphy]

I'd like to call the meeting to order.

I want to welcome everyone here.

I especially want to welcome Professor Ned Franks, Professor Emeritus of Political Science at Queens University. Of course, Professor Franks was the senior researcher with the Gomery commission. We also have with us, colleagues, Professor Jonathan Malloy. Jonathan is a Professor of Political Science at Carleton University. He was a researcher with the Gomery commission and he wrote the paper “The Standing Committee on Public Accounts”. And we also have with us Geoff Dubrow, who is with the Canadian Comprehensive Auditing Foundation.

Geoff, do you want to stand up and just introduce yourself? Do you want to join us at the table, Geoff? He only got the invitation this morning, but he's certainly more than welcome to join us.

This meeting was called by the steering committee. Basically, as everyone knows, the public accounts committee was subject to much comment and several recommendations in the Gomery commission. Actually, there were four recommendations in the Gomery commission dealing with the public accounts committee. I think it would be helpful if I just went over them to provide some focus to the meeting.

Recommendation one talks about more funding for committees generally.

Recommendation three is:

To enable the Public Accounts Committee to perform its responsibilities more effectively, the Government should increase its funding substantially to provide the Committee with its own research personnel, legal and administrative staff, and experts as needed.

Recommendation seven is:

The members of the Public Accounts Committee should be appointed with the expectation that they will serve on the Committee for the duration of a Parliament.

And recommendation eight is:

The Public Accounts Committee should ensure that Deputy Ministers, other heads of agencies and senior officials are the witnesses called to testify before it. As a general principle, Ministers should not be witnesses before the Committee.

These were recommendations dealing specifically with the public accounts committee. Professor Malloy made other recommendations in his research paper, and he talks about the members of the committee being more focused on accountability issues. His recommendations, of course, are at the end of his paper, which, of course, was produced in the Gomery commission.

The steering committee thought that perhaps five or six months after the fact it would be a good exercise to get together with Professor Franks and Professor Malloy and just generally have an informal discussion as to how they feel the committee can be more effective as we go forward.

This is the last meeting of the public accounts committee before September, so we'll have time to think about it. Some of us will be in Charlottetown, Prince Edward Island, for the annual meeting of the Canadian Council of Public Accounts Committees.

So those, members, guests, are my opening comments.

I understand that both Professor Malloy and Professor Franks have opening comments, and I'm going to ask Professor Malloy to start.

[Jonathan Malloy, Associate Professor, Department of Political Science, Carleton University, As an Individual]

Thank you for inviting me to speak to you today. I want to make a brief opening statement, and then I look forward to your questions and comments.

For some years I have observed the House of Commons committee system and the attempts to reform and improve it. Many people, both inside and outside Parliament, argue that committees are the places where the role of the individual MP can best be enhanced. However, I have often argued that many of these same observers have inflated and unrealistic expectations of what Commons committees can reasonably accomplish in our system of representation.

More recently, I have concerned myself with this particular committee, and I was asked to write a report for the Gomery commission on the PAC. In that report, I argued that the public accounts committee labours under the same constraints faced by other standing committees--constraints that all of you know very well, I'm sure. These constraints include high membership turnover, particularly between parliaments; the seemingly random assignment of members to committees that maybe do not match their interests; and highly competent but modest staff and resources.

I often feel that discussions of our overall system of accountability do not fully recognize that the PAC is just one of many standing committees in the House of Commons. Like all committees, its members must deal with multiple responsibilities and commitments. MPs have many roles, and committee work is just one of them. However, the PAC is a special case and is not like other committees. It has unique opportunities and also unique burdens. It has unparalleled responsibility to inquire into and investigate matters of public finance and administration, rooted deeply in ancient traditions of parliamentary scrutiny.

Yet the PAC is not always a desirable assignment for most MPs. Many members aspire to so-called policy committees, where they feel they can make more of a difference. Their focus is prospective, on future policies, not retrospective, on administration. This is perhaps understandable, but unfortunate.

Furthermore, the public accounts committee does not have much in the way of specialized research expertise for its investigations. Instead, it is highly dependent on the reports of the Auditor General of Canada for its work--indeed, for most of its agenda. This concerns me. Relations between the AG and committee seem generally good, but, like many observers, I fear that the Auditor General has supplanted much of the traditional scrutiny role of Parliament in this regard.

I'd be glad to speak more on these matters and further share my opinions on them. However, as an outside observer, I do not want to spend my time in these opening remarks telling you things that perhaps you already know. Thus I will conclude my opening remarks here and be pleased to take your questions later on.

Thank you.

[The Chair, Liberal, Shawn Murphy]

Professor Franks.

[Prof. C.E.S., Ned) Franks (Professor Emeritus of Political Science, Queen's University, As an Individual]

Thank you. It's an honour to be here.

I have some written remarks, but through my error they did not get to the committee and did not get distributed, but they are now with the clerk of the Committee.

I'm fairly excited about what's happening with the public accounts committee. It's at a crossroads in its evolution and work. The reforms proposed in the Federal Accountability Act make deputy ministers and heads of agencies accounting officers who will be responsible and accountable in their own right before the public accounts committee for their performance of their management duties. This largely accomplishes the recommendations of the committee in its 2005 report, Governance in the Public Service of Canada: Ministerial and Deputy Ministerial Accountability, most of which was supported in the Gomery commission's recommendations.

It's time for the committee to do exactly what it's doing, because this gives the committee an opportunity for a new and much stronger role in asserting the role of Parliament in the control of the public purse, and that, ultimately, is the core of it all.

I keep emphasizing to the government that Parliament is entitled to establish the terms and conditions of accountability to it, by whom and for what and in what way, just the same as Parliament is entitled to establish the terms and conditions of the grants of funds to the government, including the vote structure. That's a parliamentary decision, not a government decision. I get concerned sometimes that the government thinks ministerial responsibility is a government doctrine. It's not. It's a parliamentary doctrine. And accountability to Parliament is a parliamentary doctrine, not a government doctrine. It is the same with the estimates process.

I won't go into the role of the public accounts committee, but roughly what the Federal Accountability Act does is give a range of management duties relating to finance, explicitly to deputy ministers and heads of agencies. It lists those 20 deputy ministers and 78 heads of agencies, some of whom are the equivalent of deputy ministers. Some agencies are more autonomous. Then it says those are the people who will be accountable. I find that valuable, in a way. To relate to the committee's recent business, the head of the firearms agency would be an accounting officer in that sense and responsible for signing the accounts of that agency and for the transactions that are or are not recorded in those accounts. It's very important to appreciate that there are some pretty important steps forward in clarifying responsibility and accountability in the act.

I won't go into that any further, but let me say one thing before I go on. I do not believe most provisions would be in the Federal Accountability Act without the work of this committee. It is one of the most significant things this committee has done, and the committee deserves recognition and congratulations on what it has done and what it is doing in that area. It is a tremendous achievement, particularly since you've met resistance from the government every step of the way, and still are, on some of the things.

My next comment is that it seems to me the public accounts committee has to build up a relationship with Treasury Board as the central agency in government responsible for ensuring good financial management. I would suggest at this point, to make it very brief, there are two areas in which the public accounts committee and Treasury Board have to get together, and both will require changes in existing practices and procedures.

One is that the terms and conditions of the accountability of accounting officers before the committee need to be established in writing, and there should be a protocol, presumably prepared by Treasury Board but agreed to by the committee, in which the committee should ensure that it meets its needs, which describes what the responsibilities of accounting officers are in relation to the committee, what the process for their accountability is, and what their accountability before the committee means. That is something that has to be established between the committee and Treasury Board.

I believe the second area, which is not dealt with in the Gomery commission or in any of the others, is that it's the Treasury Board, not the Auditor General, that should respond back to the committee on action taken by the government on the committee's recommendation. In other words, the committee should hold the Treasury Board responsible and accountable for ensuring that the recommendations of the committee are either implemented or that the government enters into a dialogue with the committee on what might be done to resolve the problems in them.

I consider that one to be very important, because it seems to me that the accountability-responsibility process should leave the Auditor General as an auditor and should bring the Treasury Board more into it as a responsible and accountable central agency that has a very important relationship with the committee.

I will make two other brief comments and then stop.

One of the recommendations of the committee, in its tenth report last year, was on the tenure of deputy ministers. It said that they should stay in office longer than they had been.

That same recommendation was made by the Gomery commission, and nothing on that appears in the Federal Accountability Act.

When I look at what happens, including at this committee, which often has a deputy minister in front of it, who not only was not a deputy minister of that department at the time, but there might have been an intervening deputy minister between the time a problem occurred and the present. The deputy ministers had changed rather quickly and suddenly in the Indian affairs department in the committee's work and, more recently, in the investigation into the question of supplementary estimates and the firearms program. I think there's a problem there.

Years ago I did a fair amount of work on security services, and especially on their accountability. One of the terms used in security services is a seagull mission, where a spy or an agent flies into an area, makes a mess all over the place, then flies out again. I have a sense that quite often deputy ministers are on seagull missions in departments. They fly in, make a mess of things, and then fly out after a year.

That is not a basis for good responsibility and accountability. The basis of responsibility is that you have to live with the consequences of your decisions and actions. I'm not satisfied that our present procedure for handling deputy ministers and heads of agencies, who will be the accounting officers, allows that to happen.

The final point I wanted to make is that I read through the minutes of the evidence of the committee's investigation into the Firearms Act issue. I was truly impressed, in the committee's proceedings, by the way the committee acted as a collegiate body in handling the inquiry. The members shared time and they allowed members to focus on an investigation.

I thought it was a very good inquiry, and it seems to me this indicates that in future this committee is likely to work as a collegial body, acting on behalf of Parliament and the people of Canada, in what should be a non-partisan activity of examining the way the government uses funds, and in particular how the public service uses funds, to ensure that these funds are handled with regularity, propriety, and economy. That should not be a political or partisan issue. If it is, something has gone wrong. It should be one where Parliament itself expresses a concern on the part of the people of Canada and satisfies the people of Canada.

I draw your attention to that and to your recent work, as a strong indication of the right way to go.

Thank you, Mr. Chair.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Professor Franks. We always enjoy your presentations.

And thank you, Professor Malloy.

Mr. Williams, a point of order.

[John Williams, Conservative, Edmonton—St. Albert, AB]

Given the nature of our meeting today, I would propose that rather then doing our eight and four minutes, you run this as more of a round table, so that we can have a genuine discussion and be able to follow through an idea and a proposal.

[The Chair, Liberal, Shawn Murphy]

That sounds great.

I'll open it to somebody to start.

[Yasmin Ratansi, Liberal, Don Valley East, ON]

Because I am new, I would like to start it and then I want you to follow through.

[An hon. member]

[Inaudible--Editor]

[Yasmin Ratansi, Liberal, Don Valley East, ON]

The reason I pointed at him is because he is Mr. Nasty.

[The Chair, Liberal, Shawn Murphy]

If I could make a comment, I'm going to have to keep some kind of informal control in a minute. I appreciate the gist of Mr. Williams' thoughts, and I agree with them, but I will keep some control of the time.

Perhaps before we start I will ask Mr. Dubrow if he has any comments he'd like to make.

I know you've just been invited today. I thought it would be nice for you to be here. We certainly appreciate the work your foundation does, and we certainly hope we'll be working very closely with you and your foundation in the months and years to come.

Is there anything you want to add right now, sir?

[Geoffrey Dubrow, Director, Capacity Development, Canadian Comprehensive Auditing Foundation]

Thank you very much, Mr. Chairman.

At this point I can say a couple of brief words about the foundation. I can mention that we'd certainly be willing, on your invitation, to return in the fall for a presentation. But I don't think at this point it would be appropriate for me to make any substantive comments in any way that would supplant the presentations that are being made by our two witnesses today.

[The Chair, Liberal, Shawn Murphy]

I have one final point--I just want to pull this thing together—about the publication the foundation published recently. I want to point out that we passed a motion to purchase a copy for each member of this committee. That has already been ordered from your foundation. We thank you for that report.

Mr. Williams.

[John Williams, Conservative, Edmonton—St. Albert, AB]

Can we afford that?

[The Chair, Liberal, Shawn Murphy]

We passed it, whether we can afford it or not. Maybe we're into a deficit situation.

[A voice]

Actually, they're giving us a preferential price of $40.

[The Chair, Liberal, Shawn Murphy]

We negotiated a preferential price.

We go to Ms. Ratansi.

[Yasmin Ratansi, Liberal, Don Valley East, ON]

Mr. Chair, my question is to Professor Malloy.

I think I need some clarification. I'm new to the committee on public accounts, so I am going to qualify the statement. You said that you're disappointed that this committee relies on the Auditor General to bring forth issues. Did I hear you correctly?

[Jonathan Malloy]

That's correct. I must say that in speaking to previous incarnations of this committee I've always been struck by the fact that members are quite comfortable with the relationship with the Auditor General.

[Yasmin Ratansi, Liberal, Don Valley East, ON]

I have another question.

We are a committee; we're not an operational body. If we don't rely on the Auditor General, who has the mandate, as an external auditor, to prepare a plan, which she presents, and to say here is my cyclical audit, here are my priorities, and here is where I think risks are, what alternative would you suggest?

[Jonathan Malloy]

The alternative, I would suggest, would be a committee that had more resources of its own and would perhaps, at times, pursue an agenda that is somewhat different from the reports of the Auditor General, which does certainly happen with some of the provincial public accounts committees. Having said that, a lot of my concerns are indeed a bit more theoretical perhaps and aren't necessarily shared by the members of the committee.

I think there is some question of exactly who is in the driver's seat. Is it the Auditor General or is it this committee of the House of Commons? There's always the issue that the Auditor General is ultimately responsible to this committee for her own office and affairs. In theory, the relationship could be one of a conflict of interest.

I agree, in speaking to members, that they feel that these are perhaps theoretical concerns that don't actually arise that much, but I think they are important to keep in mind.

[Yasmin Ratansi, Liberal, Don Valley East, ON]

From a practical perspective, under the current structure, if the committee gets a brown envelope from somewhere and thinks a special program needs to be audited—somebody from the committee can help me—can we ask the Auditor General to conduct the audit?

Yes, we can.

[The Chair, Liberal, Shawn Murphy]

Yes, but she doesn't have to do it.

[Yasmin Ratansi, Liberal, Don Valley East, ON]

My practical question is--

[John Williams, Conservative, Edmonton—St. Albert, AB]

If I could, I'll answer that question specifically.

Mr. Chairman, it requires a motion by the committee that is taken seriously by the Auditor General but is not a directive to the Auditor General.