Public Accounts Committee on Feb. 5th, 2008

[The Chair, Liberal, Shawn Murphy]

At this time, I'd like to call the meeting to order.

I want to welcome everyone here. Bienvenue à tous. On behalf of the committee, I especially want to extend a welcome to the witnesses.

Today, pursuant to the Standing Orders, we're dealing with chapter 5, “Keeping the Border Open and Secure - Canada Border Services Agency” of the October 2007 report of the Auditor General of Canada. The committee is very pleased to have with us today, representing the Office of the Auditor General, Hugh McRoberts, assistant auditor general, accompanied by Gordon Stock, principal; and representing the Canada Border Services Agency, we have Alain Jolicoeur, president. Bienvenue Monsieur Jolicoeur. We have Stephen Rigby, executive vice-president, and also accompanying him is Cathy Munroe, director general of programs and operational services directorate. Again, welcome everyone.

I understand, Mr. McRoberts, you're going to give an opening statement on behalf of the Office of the Auditor General, and I invite you to give your opening statement now.

[Hugh McRoberts, Assistant Auditor General, Office of the Auditor General of Canada]

Thank you, Mr. Chair, for inviting me to discuss chapter 5 of our October 2007 report, “Keeping the Border Open and Secure”, an audit of the Canada Border Services Agency.

With me today is Gordon Stock, principal of the public safety team responsible for this audit.

The Canada Border Services Agency has a wide-ranging mandate. Every year it allows 96 million people to enter Canada and it approves the entry of $404.5 billion worth of imported goods. Its 12,800 staff provide a full-time presence at 148 border points and a limited presence at a further 1,121 locations across Canada.

This was our first performance audit looking specifically at the agency since it was created in December 2003. As such, we examined those areas of the agency that focus on its expanded mandate. The areas included the border functions of three legacy organizations—customs from the former Canada Customs and Revenue Agency, immigration from Citizenship and Immigration, and animal and plant inspection from the Food Inspection Agency. Added to this was the agency's expanded mandate in national security.

This expanded mandate requires the agency to facilitate the flow of legitimate goods and people while also supporting national security and public safety priorities. We found that the agency and its predecessor organizations had been refining their risk management approach to border management for more than a decade, but they did not have an integrated risk management framework in place.

Border management can be characterized as a number of sequential layers of protective measures. However, without an integrated framework, a weakness that is encountered in one area is not recognized and mitigated through additional evidence in the next layer of protection. For example, we found that containers that were not scanned before they arrived at the port of entry were not subject to additional procedures or examination to bring down the risk to an acceptable level. The committee may wish to ask the agency about the progress it has made in its risk management approach to managing the Canadian border.

We found that the agency does not have a risk-based model to determine the resources required for all ports of entry and modes of travel. For example, the decision to choose people and goods for further examination upon arrival at a port of entry is based on an assessment of risk indicators by border services officers. However, the overall rate of examinations is based mainly on the capacity of personnel and availability of equipment.

We also found that the reason to refer individuals and shipments for further examination is not fully communicated to those officers doing the secondary examination, and results of the examination are not always documented. Without this information, the agency does not have the information it needs to determine whether it is appropriately matching the level of examination activity to the level of risk.

The agency now receives considerably more information on travellers and shipments in advance of their arrival than it did five years ago. It is one of the few border service agencies to use automatic risk scoring systems to analyze advance information and to target higher-risk people and goods for additional examination.

However, the agency has not systematically examined whether these tools have improved its ability to identify national security risks or prevent the entry of prohibited goods or people. We found that the border service officers perceived weaknesses with these systems and relied on more traditional examination methods. The agency recognizes these weaknesses in the new systems and is working to improve them.

In recent years, the agency has developed a number of pre-approval programs to speed the entry of lower-risk people and goods. The agency cannot currently prevent someone from enrolling in these programs when intelligence information suggests that a person poses a higher risk, but it may carry out additional monitoring. We found, however, that even with this monitoring, the agency did not have processes in place to ensure that net risk levels were reduced to low.

We found that the agency has successfully used specialized inspection equipment to make high-value seizures at ports of entry. However, we noted that the agency had not linked the use of this equipment to its assessment of risk. Further, not all individuals and shipments that were identified as high risk—and referred for further examination—were actually examined at ports of entry, and explanations for not performing additional examinations were not documented.

From our work, there are three overriding factors that we would like to bring to the committee's attention. Together, these factors would allow the agency to respond quickly to a changing risk environment.

I have already mentioned the first factor, the need for a robust integrated risk management approach to border management.

The second factor is the need for random examinations, which are an excellent control, as they are the one type of examination that cannot be beaten by those who wish to go undetected. In our audit, we found that random examinations were often the first thing to be cast aside when workload increased.

The third factor is the need to document the results of all examinations, not only to have a record of decisions made but to serve as a foundation to measure performance and determine where there is room for improvement.

Without combining these three factors, the agency is reacting to a changing environment instead of managing it.

Mr. Chair, thank you. This concludes my opening statement. We'll be happy to respond to the committee's questions.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Mr. McRoberts.

I understand, Monsieur Jolicoeur, you're going to give the opening remarks on behalf of the agency. The floor is yours.

[Alain Jolicoeur, President, Canada Border Services Agency]

Bonjour. Thank you.

Chair, members, and representatives of the Auditor General, thank you for the opportunity to provide the CBSA's perspective on the Auditor General's report.

I'd like to introduce my colleagues: Stephen Rigby, executive vice-president; and Ms. Cathy Munroe, the director general of the operations branch.

First, it's important to understand the critical role of the border in ensuring both security and prosperity. The border plays a dual role of facilitation and security. Smart and secure borders keep criminals and other dangerous elements out and allow for efficient border support of immigration, trade, and tourism.

WIth thousands of trucks, boats, aircraft and travellers going across Canada's borders every day, it goes without saying that our agency plays a vital role in ensuring access to the Canadian economy. Here is an overview of what goes across the border every day: 17,000 trucks and 260,000 travellers. Further, over $70 million in taxes are collected every day and cross-border trade totals over $1.9 billion every day.

While we must be vigilant against dangerous people and goods, we must also ensure that the border is a gateway to prosperity, not a cumbersome checkpoint that hurts our economy.

The genesis of the CBSA was a very rare occurrence, where a new organization was created overnight by putting together pieces of three different organizations with a new mandate. The formation of a 13,000-person and $1.5-billion organization is a huge and complex undertaking. We've built this organization while operating on a 7/24 basis in a post-9/11 environment, with ongoing demands for new border services and significant resource pressures. In spite of these pressures, we are confident that our people and processes make Canada's border among the most secure and efficient in the world.

We have made significant progress in establishing the agency. CBSA is now a more mature and stable organization and has achieved some significant results in 2006-07, including over 10,000 weapons seized, 500 of which were firearms; 9,000 drug seizures, valued at over $400 million; and the removal of over 12,000 inadmissible persons in 2006, including 2,000 for reasons of criminality.

Clearly all nations, including Canada, cannot guarantee absolute safety against border threats. CBSA processes an average of 97 million travellers every year and approves the entry of over $400 billion in imported goods annually. It is impossible to stop and check every individual and every piece of merchandise.

Therefore, our focus must be on risk management. Over the past four years, the CBSA has developed a robust and sophisticated border management regime with a scientific approach to risk assessment and detection.

CBSA risk management is multi-layered. Our operations are based on three fundamental strategies: pre-approval programs to facilitate low-risk people and goods; advance information on what and who is coming to the border to identify high or unknown risk people and goods; and then turning this information into intelligence using sophisticated science and technology-based risk assessment systems.

CBSA is now engaged in huge and complex initiatives that will further transform and modernize border management, including deploying new science and technology such as biometrics for identifying trusted travellers, and sophisticated detection technologies for radiation; arming border officers and eliminating situations where they are working alone; working with U.S. counterparts in ensuring that the western hemisphere travel initiative is implemented as smoothly as possible and does not impede travel and cross-border trade.

But our work is far from being done. Integration is not fully completed yet. There are still many finishing touches to apply.

The Auditor General's report highlights areas where we need to, and will, make progress. The CBSA concurs with all the recommendations in the AG's report, which are indeed consistent with our ongoing actions and future plans.

A comprehensive action plan has been developed to address all of the recommendations, and actions have already been taken and completed, in some cases. As I said, we agree with the Auditor General that we can and must do better. Implementing her recommendations will enhance our ability to manage risk and improve border operations.

Thank you, and I look forward to our discussion.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Mr. Jolicoeur. Merci beaucoup.

We'll try the eight-minute round initially, starting with Mr. Wrzesnewskyj, followed by Mr. Laforest.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

Thank you, Chair, and thank you, witnesses, for appearing before our committee.

My question is to the Canada Border Services. There was a highly touted initiative last year by the Minister for Public Safety, Stockwell Day, to provide handguns for our border security officers. What is the actual number of handguns in this initiative?

[Alain Jolicoeur]

The initiative provides for arming 4,800 officers of our organization.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

So 4,800 officers with handguns. What is the cost to date of this program, and what is the most recent projected cost to provide handguns to our border security officers?

[Alain Jolicoeur]

Mr. Chair, I believe the cost for the first part of the exercise, and we are still in that first part, is $101 million. The cost over the 10-year period for arming, training, and equipping our officers, and replacing those who will need to be replaced in that period of 10 years, is, I believe, $780 million.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

So we're fast approaching a billion dollars for not quite 5,000 handguns. My goodness, that's approaching $200,000 per handgun.

Just out of curiosity, was this initiative one of the priorities the department gave the minister? I've taken a look at some of the other initiatives, to provide integrated information systems, which have been completed, etc.

Was this an initiative that was generated from your department or from the minister's office?

[Alain Jolicoeur]

Mr. Chair, whenever we have a new minister in any organization in the public service we provide them with options for different initiatives, and that was part of that discussion on options for securing the border.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

At that time, did it have a price tag of $780 million attached to it?

[Alain Jolicoeur]

The cost evaluation for this initiative was developed in that period, yes.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

It would have been tremendously helpful when it was first announced by the minister if he'd levelled with us about what the actual cost of this initiative of Mr. Stockwell Day's would entail.

Let's move on to some of the details here. I understand from the auditor's report that 21% of so-called “lookout” subjects enter into Canada without being referred from primary to secondary inspection. That's one out of every five people who have been flagged. I find it difficult to understand how it would be possible.

Then further on I read that even though $150 million--I guess less than one-fifth of what's been put into low-tech revolvers--has been invested into automated systems, IT systems, it's at a point where CBSA does not monitor the effectiveness of the system. In fact, most of our border security officers have to rely on their own judgment. In the Auditor General's report it says they have to rely on their own judgment.

[Alain Jolicoeur]

Mr. Chair, this question is very important to us. What the Auditor General is referring to is the way our first model for risk assessment was used by our targeters in the organization. It is a fact that we need some additional training of our targeters to optimize the use of those systems, but this is the first model. We are already at the fourth model, whose performance is a lot improved over that first model. The system is called TITAN. We've looked at TITAN 1, and now it's used by our targeters. We are already at TITAN 2, and we have already developed TITAN 3 and TITAN 4.

We admit that we need significantly more training so that our targeters are able to use that additional information, but when you make the point that they just rely on their judgment, that's the situation everywhere in the world. And that was the situation in Canada, where decisions were made one by one. Now we've gone way beyond that, and the example we put forward is now copied by other countries.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

Just so I understand, more than one out of every five flagged individuals actually get into the country without secondary inspection. Per year, in hard numbers, what does that translate into? Are we talking about thousands of individuals? You said nine-million-odd. How many of those individuals are flagged, and what does that 21% translate into when it comes to hard numbers? How many people who shouldn't be in this country are potentially in the country?

[Alain Jolicoeur]

Mr. Chair, I'd be very concerned if one out of five flagged individuals in our system were not referred to secondary. I'm sorry, I really don't think that is the case.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

That's in fact what the Auditor General's report tells us, so it's of even graver concern that the Auditor General's report would have found that one out of every...21% of those individuals flagged.... The exact wording would have been that immigration lookout subjects did not go to secondary.

The fact that you haven't read the report—you've said that you concur with everything in the report and that you will improve—yet the fact that you haven't decided to address this particular issue--

[Mike Lake, Conservative, Edmonton—Mill Woods—Beaumont, AB]

On a point of order, will the honourable member please refer to the section he is talking about, so we can follow?

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

I hope my time has been stopped as I address this point of order.

[The Chair, Liberal, Shawn Murphy]

It's section 5.84.

Go ahead, Mr. Wrzesnewskyj, and I point out that you only have about 30 seconds left.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

Okay.

Finally, we'll return to this particular subject, but I have other concerns. I've heard from officers that perhaps individuals flagged by INTERPOL could get on an airplane, be on a list—noted at Heathrow—arrive in Canada, and since many people have dual or triple passports these days, all they have to do is switch their passports and they can get through primary without being flagged. Could you answer that?

Also, something that I have found perplexing, and it's perhaps really low tech, but it's common sense. Virtually every country in the world has separate lines for the citizens of their countries, as they enter primary inspection, and separate lines for non-citizens. In this post-9/11 world, why wouldn't we have done something as simple as that?

[Alain Jolicoeur]

Mr. Chair, the member has made quite a few comments--

[The Chair, Liberal, Shawn Murphy]

I realize that.

[Alain Jolicoeur]

--and I'll try to capture them rapidly.

I have read the Auditor General's report many times. Indeed, I said that I agree with all of the recommendations and will repeat it as often as you want.

The question of the percentage of lookouts that would be missed by officers is a question of training. There is no doubt in my mind, zero doubt, that we don't miss one-fifth of the lookouts. The report and the procedure referred to a sub-area, and we can discuss that, but that would not be a proper projection in the whole universe of lookouts.

You made a point about the question of exchange of passports. This is a serious concern, and we have procedures in place to ensure that people come with the right passport. We have rovers and employees who are in the area where the exchange could be made. We also have something that's unique and that other countries, including the United States, would like to do: we have migration integrity officers in airports all over the world, in 39 countries. They basically work against that phenomenon. We have had success; we intercept more than 5,000 people every year who are trying to come in using these mechanisms. So we are doing that, and we are training our people so they can be better at doing that.

Your last point was on separate lines. I get that comment often, and when I travel and come back I make that comment myself. We discussed it, and we've tried it many times. Most of the time we've had to get out of it because the ratio of Canadians and non-Canadians in big airports is changing very rapidly; therefore, it is turning out to be less efficient to do it that way. But we will explore it again. We are actually doing it at Vancouver International Airport with the help of the airport authority, who are putting some resources into doing traffic management, because you need to adjust the flow of traffic very rapidly when you do that.