Public Accounts Committee on Dec. 5th, 2006

[Sheila Fraser]

I think it's a very good question.

I think the most troubling part of all of this story is the fact that it went on for so long and no one ever did anything or said anything about it.

Because of the nature of the office, as an ombudsman, I think there has been a hesitancy on the part of the central agencies to be seen interfering in the management of these offices. I think this is also true for some of the quasi-judicial bodies, the tribunals. I'd say it also holds true for the deputy minister.

For example, this office was a separate employer—the staff weren't unionized—and probably had little to do with the Treasury Board Secretariat on human resource issues. To our knowledge, we saw no indication that an internal audit had ever been done.

I think there's an issue around governance. How do you maintain the independence that these agencies and offices need to carry out their functions and yet ensure good accountability?

We are starting an audit on small agencies, and it's one of the issues I want us to look at. I think the central agencies need to play a more active role in this. We tend to blame them for not catching this stuff. But I think they will tell you they're often told by the agencies that the agencies are independent and they can't interfere in agency operations.

It doesn't hold true for the executive director and other senior officials who were in that office for a very long period of time and clearly knew what was going on.

I think there was also some confusion or at least purported confusion because the department of public safety, formerly the Solicitor General, did the processing for this office and paid the bills. For example, Mr. Stewart would send his expense accounts directly to them and did not go through someone in his office. But we all know you're not supposed to sign your own expense accounts, and they should have been returned.

There was confusion about who the senior financial officer was. But to me, even that is almost irrelevant. If people saw invoices coming through that were clearly inappropriate, someone should have said something. I think there's a broader question on why no one said anything for so long.

[The Chair, Liberal, Shawn Murphy]

What about the people who took the cheques at the end of the year? What's your comment on that?

[Sheila Fraser]

I'm not sure how it was presented to them. There were people who obviously worked very hard to figure out the number of hours of overtime each person would have had to work to end up having the same amount of money for everybody. It was not an insignificant exercise to figure this out.

[The Chair, Liberal, Shawn Murphy]

Whoever did the calculation, that person would be entitled to overtime.

[Sheila Fraser]

That person would know.

[The Chair, Liberal, Shawn Murphy]

He'd be entitled to overtime.

[Sheila Fraser]

Perhaps he would.

[The Chair, Liberal, Shawn Murphy]

I have one last question before we go to Mr. Proulx. I ask this question when we have these occurrences of problems. I always ask it and I always get the same answer.

Were there any sanctions imposed, and did the persons in this case, Mr. Stewart and the executive officer, receive performance pay?

The answer I always got for the first part of the question was no, and the answer was yes for the second part. Is my record intact?

[Sheila Fraser]

Mr. Stewart did receive performance pay.

On the sanctions, I think the government is currently looking at the situation and trying to recover the money. They will have to determine whether any sanctions are in fact even possible, of course, because he is now retired.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Mrs. Fraser.

We're now in round two.

Monsieur Proulx, cinq minutes.

[Marcel Proulx, Liberal, Hull—Aylmer, QC]

Thank you, Mr. Chairman.

Good day, Ms. Fraser, Messrs Campbell, Timmins and McRoberts. It's always a pleasure to welcome you to the public accounts committee. We learn so much from your appearances, Ms. Fraser.

Ms. Fraser, I'm very interested in some of the points discussed in Chapter 5. I understand some things, but I'd like you to confirm certain facts for me.

A reference is made to 15,000 relocations every year. Can you explain to me what a relocation actually involves? I'll get to the specifics a little later.

Why type of work does Royal Lepage do in conjunction with a relocation?

[Sheila Fraser]

Some of my associates are more familiar with the details. Perhaps I could ask Bruce Sloan to join us.

[Bruce Sloan, Principal, Office of the Auditor General of Canada]

Thank you, Mr. Chairman.

For each administration, each relocation has an administration fee that goes with it and it's approximately $1,700.

[Marcel Proulx, Liberal, Hull—Aylmer, QC]

Excuse me, that's not really my question. Maybe the translation gave it that way, but what I'm looking for is this. What is involved as far as work in one file? What does Royal LePage have to do?

[Bruce Sloan]

With each relocation they will meet with the member of the Canadian Forces or the RCMP who is being relocated, facilitate, and make arrangements for them for a house-hunting trip in their new location. They will pay the third-party service such as a real estate commission or legal fees or home inspection fees when that transaction occurs. Then they will ensure that each transaction or each payment is in accordance with the limits set out in the policy for the relocation. So there is a system they've developed and put in place to track each payment relative to the policy.

[Marcel Proulx, Liberal, Hull—Aylmer, QC]

Okay, you're too far ahead for me. I'm slower than that.

May I refer you to the French version of chapter 5, paragraph 5.8. If I read it correctly.... That was the purpose of my question.

That's why I asked the question, Mr. Fraser.

The report notes the following:

5.8 Members of the RCMP and employees of government departments do not have RLRS consultants in their detachments or offices. Consultations between a members and RLRS are conducted by phone or through other electronic means.

Again, I ask the question. What kind of work does RLRS do on a day-to-day basis when assigned a so-called relocation file?

[Sheila Fraser]

As Mr. Sloan explained, they help the person relocate to a new area. As indicated, they organize trips to search for a new house and offer various relocation services, but they do not handle the actual move as such.

[Marcel Proulx, Liberal, Hull—Aylmer, QC]

Ms. Fraser, according to section 5.8 of your report, all of these details are handled by phone or through electronic means. Is that correct?

[Sheila Fraser]

What we meant here is that RLRS representatives are not in each RCMP detachment or on each military base.

[Marcel Proulx, Liberal, Hull—Aylmer, QC]

I understand, but according to your report, consultations are conducted “by phone or through other electronic means”. Therefore, there is no contact with the representative as such, other than by phone or through electronic means.

[Sheila Fraser]

That's correct. Services are provided from a central location.

[Marcel Proulx, Liberal, Hull—Aylmer, QC]

Supposing Mr. Smith relocates from Nanaimo to Gatineau. Does that means Royal LePage will handle the sale of his house in Nanaimo and search for a new property for him in Gatineau?

I haven't had any answer yet, Mr. Chair.

[Sheila Fraser]

Possibly, but Royal LePage may not necessarily be handling the sale or purchase.

[Marcel Proulx, Liberal, Hull—Aylmer, QC]

Bon. I have a very short one, Mr. Chair.

Earlier, you told Mr. Sweet that after the first contract was awarded, there was no criminal investigation or criminal charges laid. Isn't that because the contract was cancelled owing to the fact a Public Works employee had received a kickback in the form of a trip of some kind?

[Sheila Fraser]

My understanding -- and the department can confirm the facts -- is that a Public Works employee went on a trip at the same time as some Royal LePage representatives.