Public Accounts Committee on April 8th, 2008

[John Sims]

Yes, it's approximately right. I can get the exact figure, but that's about right.

[Charles Hubbard, Liberal, Miramichi, NB]

But in terms of the questions that were asked about our being a big legal firm.... Most legal firms you deal with have costs associated with each lawyer. In other words, if I were to call a lawyer, depending upon the quality and the experience that the law firm had for my case, each of those lawyers would have an hourly rate.

Has your department considered an hourly rate? When you call Mr. Côté, does it cost me $400 an hour to talk to him, or maybe $1,000 an hour, if he's had a lot of experience? Is that an avenue you have looked at in terms of costing to departments?

[John Sims]

Yes. We have an hourly rate, and it varies by the seniority of the lawyers involved. We arrived at this rate in conjunction with the Treasury Board, and it's adjusted annually—and we've adjusted the formula for this hourly rate recently. But we definitely have an hourly rate.

[Charles Hubbard, Liberal, Miramichi, NB]

Of the 2,500 lawyers, how many are directly involved with providing legislative services to government? We have bills come to the House every week, nearly, and they come from your department. Are there 200 lawyers working on legislation?

[John Sims]

My colleague is looking in the RPP now to see whether we can find that figure quickly. If we can't, I'll get it for you, sir.

[Charles Hubbard, Liberal, Miramichi, NB]

One of the big costs that seems to be spoken about, from your statements today, is the cost involved with legislation that needs to be judged. The Charter, for example, has been a big cost to your department since its start.

We have had considerable concerns with some bills that come to us as parliamentarians. For example, Bill C-2 was done, I think, quite hurriedly—a very complex bill. When your legal group presents that to Parliament, are you satisfied that it's good legislation, the best legislation, legislation that will be held up in a court of law; or are you creating some legislation that would present great problems and great costs to our departments in the future?

Bill C-10 is another one we are concerned about. There is fisheries legislation; we referred here a few minutes ago to the fisheries department and the fact that a new bill is being presented to Parliament. In fact, it's there and is probably going to committee at second reading.

As lawyers, in presenting legislation—and I go back to Bill C-2 in particular.... You must have made great efforts, to present Bill C-2 to Parliament as quickly as it came. It's very complex legislation. Eventually it got through, though it was held up for a time in the Senate, as was Bill C-10.

Are we guaranteed as parliamentarians that you as a department have not only done your work but also probably have consulted some outside legal opinions, so that the legislation you come with is as perfect as possible in terms of what our country needs within its justice system?

[John Sims]

That's a really interesting question, and I'd like to answer it in parts.

First of all, for every bill the Government of Canada tables, we must certify if it's not constitutionally sound. There isn't a bill that the government tables that has not been analyzed by Department of Justice lawyers to ensure compliance with constitutional and charter principles. Whether it is the policy that Canada needs, of course, is another question.The policy content comes from the government, not the lawyers analyzing the legality and the constitutionality of the proposal.

I don't want to talk about Bill C-2 or Bill C-10, but if we imagine the hypothetical, it frequently happens that a department sits down with its lawyers and says they want to go north. The lawyers say, “Constitutionally, that's a problem. I can get you northeast, if you modify your travel plans a bit. If you're prepared to take a train instead of a plane, I can get you northeast.” You have that conversation all the time. It's a dynamic dialogue between the lawyers giving advice, doing a legal risk analysis, and helping the policy centre to try to achieve its goals for the greater good of Canada. That's the process.

I'm being given data on the number of lawyers. There are 2,000 lawyers in the Department of Justice at the moment. About 500 of them work on policy, programs, and management. We think there are about 125 lawyers doing legislative drafting, but I'll confirm that number for you.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Mr. Hubbard.

Thank you, Mr. Sims.

Mr. Fitzpatrick, four minutes, please.

[Brian Fitzpatrick, Conservative, Prince Albert, SK]

Thank you, Chair.

I want to focus on billable hours and the hourly rates with the civil agents.

Being Irish and a lawyer and a politician, I think I belong to the three groups that are still open for humour in this day and age. There is an old story about a lawyer who passed on and was at the Pearly Gates. St. Peter asked him how old he was, and he said he was 75 years of age. St. Peter looked at his book and said, “There must be some mistake. I have you down for 100 years on billable hours.”

If there's a weakness in government, it's that people are always spending other people's money. I practised law for 25 years, and you have to get into your client's wallet to get your money. It's a different parameter when you send the bill to somebody else to pay for your time and effort.

I guess what I'm really getting at is what kinds of controls or system you have in place to put some controls on the billable hours and the hourly rates that lawyers charge. I know lawyers would all like to charge $1,000 an hour if they could, but let's get real.

[John Sims]

There are two hourly rates that we're talking about.

[Brian Fitzpatrick, Conservative, Prince Albert, SK]

Out of curiosity, what are those rates?

[John Sims]

I'm sorry I can't tell you the internal justice department rates, but I'd be pleased to send you the chart that shows the hourly rates for the different levels of justice department lawyers.

On the outside agent side, we negotiate rates on behalf of the government with outside agents. For years we have successfully retained the top-flight litigators in Canada at a very low hourly rate compared to what they would ordinarily charge their clients in the private sector. It's very, very favourable.

The work we've been doing over the last year following the Auditor General's report to put in place these new and more rigorous procurement practices and so on has been to try to use market competition techniques as best as possible to ensure we're getting a competitive look at the lawyers who are prepared to work for the Department of Justice. And we're again getting very good rates.

[Brian Fitzpatrick, Conservative, Prince Albert, SK]

I want to pursue the auditor's recommendation about the total quality management system in place. Those systems, by and large, are focused on the product or the services delivered to an ultimate customer. It's meeting and exceeding their expectations, if I understand it, and you have a system that tries to do that.

In the practice of law it seems to me it's giving advice and then getting the results that were identified in your advice. It basically boils down to something as simple as that, and that really gets into measuring performance by individuals. They are people who consistently give advice and you get the results you get from that advice.

What would you think would be the main ingredients of a total quality management system for outcomes for legal services? I assume winning is at the top of the list. You don't want losing to be your number one goal.

[The Chair, Liberal, Shawn Murphy]

Perhaps we could have a brief answer, Mr. Sims.

[John Sims]

I think the issue I take most to heart from the Auditor General's report is she says we have many elements of high quality assurance now, but what we haven't had is a system to ensure the guarantee we're getting, the quality we need in every case.

We have many, many elements of high quality now. We have peer review, for example, of the litigation that goes to senior courts, which is the best way to judge whether the legal advice and the stance we're adopting is accurate, is correct, is wise. We use legal risk-management techniques, which we discussed earlier, to analyse the risks and the advantages, but what we've lacked is an entire framework. That's what we're trying to put in place now, and the law practice management division is helping us to have that overall framework that will tie it all together.

We need to pay attention to the point the Auditor General refers to, which is we haven't defined “quality”. We think we recognize it when we see it, but we haven't defined it, and we should do that, because we think it will help. That's what we're working on.

[The Chair, Liberal, Shawn Murphy]

Thank you, Mr. Fitzpatrick. Thank you, Mr. Sims.

Monsieur Lussier, vous disposez de quatre minutes.

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Thank you, Mr. Chair.

Ms. Fraser, in paragraph 4 of your presentation, you set out your three primary objectives. I would like to focus on the third, which was to determine whether the services were cost-effective. In paragraph 8, you say that the department was not in a position to know whether the legal services it was delivering were cost-effective.

What parameters were you looking for in order to assess the department's cost-effectiveness? Were the financial arrangements with other departments one of the ways in which the Department of Justice could have delivered cost-effective services?

[Sheila Fraser]

I think that the entire system of timekeeping underlies the evaluation of cost-effectiveness. That would tell us how the lawyers are spending their time. As the system was not in place throughout the department, this information on human resources, which clearly are the department's greatest expense, was not fully available.

As the deputy minister pointed out, it is important for people to know that analyzing this information can determine whether there are trends, can identify the type of case that costs the most, can point out if there are other ways of delivering these services and other ways of handling the cases. As Mr. Sims also mentioned, when a certain kind of case is identified as a trend, we can decide if the legislation should be changed. This is the kind of analysis that we feel is necessary for the department to be well managed. Since they started with no data on how time was used and what different projects cost, management was difficult, by and large.

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Agreed.

Mr. Sims, the report mentions that, in 2005, the department operated with a budget of about $500 million. In these documents before us, the figure is now a billion dollars.

Could you paint me a quick picture of how, for example, that billion dollars is divided up among the employees, the 2,500 lawyers, that is, and the outside agents? In that billion dollar budget, do the 100 financial arrangements with other departments represent income for your department?

[John Sims]

Forgive me, but I did not understand the second part of your question.

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Do those 100 financial arrangements with other departments represent funds coming into your department that would have an effect on the billion dollars mentioned in the document?

[John Sims]

The amount spent on outside legal agents has recently gone from $30 to $25 million annually. This means that out of $600 or $700 million, only $25 or $30 million are spent on outside agents. For the distribution through the various parts of the department, we can refer to the report on planning and priorities.

[Yves Côté, Associate Deputy Minister, Department of Justice]

The budget has been mentioned at about a billion dollars. Earlier, we told you that the Federal Prosecution Service had moved out of the Department of Justice. This involved about $250 million. Then, from the funds that the department receives, a significant portion, about $330 million, is assigned each year to grants and contributions. So between $550 and $600 remain for the department's operational expenses.

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Do the financial arrangements with other departments represent revenues?

[Yves Côté]

Starting this year, with the net credit system, the amounts that come from departments are included in our budgets. When we have arrangements with them on funding projects, or when there are cases that we look after for them, those sums become part of the amount that the Department of Justice can spend.