Evidence of meeting #34 for Public Accounts in the 39th Parliament, 2nd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was passport.
A recording is available from Parliament.
Associate Deputy Minister, Department of Foreign Affairs and International Trade
We have signed off on the report.
Liberal
The Chair Liberal Shawn Murphy
So we're not going to get into another debate as to whether it's final or not?
Associate Deputy Minister, Department of Foreign Affairs and International Trade
No, no.
Let me just clarify my answer. We have signed off on the report; we're not debating these numbers at all. There are a few questions, in my mind, as I examine our action plan, as to what costs should be appropriately billed to the consular services fee as we go forward and we look at the fee level that should be adjusted or not.
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
Thank you, Mr. Chairman,
Good day to all of the witnesses.
I have a question for you, Mr. Timmins. In your opening remarks, you draw a distinction between the various categories of fees. On the one hand, there are those fees for which the amount charged normally cannot exceed the cost of what is provided.
On the other hand, there are fees such as those charged for commercial fishing licenses, tied to the use of resources. With respect to the latter category, you stated the following: “For these fees, the amount that is charged is normally related to market value rather than cost.”
I nonetheless have some serious concerns about the cost of these types of fishing licenses. Consider, for example, the cost of a crab fishing license which is now approaching $24,000, or approximately 10% of a fisher's income. The cost of the license hasn't really changed, whereas crab prices have fluctuated a great deal. They have dropped from 90¢ to 45¢ per pound over a period of ten years. So then, while the price of crab has declined, the cost of a license hasn't changed. This amount represents an important share of fishers' income. How do you explain this situation? Basically, you're saying that fees should be related to market value, but at the same time, the cost does not decrease when prices drop.
In the case of the example that you gave in the report, the opposite is true. You wondered why prices do not increase when the market value of catches increases, as in the case of crab. However, there is no logical explanation possible for that happening.
Can you tell us why you failed to mention this fact?
Assistant Auditor General, Office of the Auditor General of Canada
Thank you.
First of all, I would say that we have indicated that the value has to be taken into consideration in establishing a fee of that type. That doesn't mean that has been the case in all cases. We have reported in the chapter that for the commercial fishing licence there have been a number of studies over time of the changes in the market value and the fact that the fees should be adjusted, but they have not been adjusted.
I don't know, Mr. MacLellan, if you want to add to that.
Assistant Auditor General, Office of the Auditor General of Canada
If I can just point something out, as far as the department is concerned, market value and cost are just two of the factors that must be taken into account when establishing fees. Mr. Timmins mentioned some guidelines that must be followed, but the department must also consider the other factors listed in the report.
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
I have a question for Mr. Monette.
You stated that over the course of the next six months, you will be working with the six audited departments and that you will also be engaging other departments.
Can you tell us which departments you are working with and what type of fees are involved?
Comptroller General of Canada, Treasury Board Secretariat
Thank you, Mr. Laforest.
I think it's very important to have a good overview of the six departments. Last week, I attended a meeting along with representatives of the six departments and the chief financial officers. The goal was to put in place some sound plans to address the comments of the Auditor General.
I think we need two groups. Directors need to revise their action plans every six or eight weeks to clarify directions and issues. Occasionally, I need to meet with the chief financial officers, simply to ensure that there is transparency and a genuine effort on their part to improve the situation.
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
Can you list the six audited departments? You also mentioned that you would be engaging other departments. How many in total? I'm also curious about the type of fees that these departments charge.
Comptroller General of Canada, Treasury Board Secretariat
The six departments profiled in the report...
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
We know who they are, but what about the others?
Comptroller General of Canada, Treasury Board Secretariat
Well, there is the CRTC, the Canadian Food Inspection Agency, the Canadian Nuclear Safety Commission...
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
Would it be possible to forward to the committee a list of all of the departments that charge user fees, along with the amount they charge?
Bloc
Jean-Yves Laforest Bloc Saint-Maurice—Champlain, QC
Thank you, Mr. Monette.
I also have a question for Mr. Rigby.
In your opening statement, you say this: “As was noted in the original Treasury Board submission, the Consular Services Fee is in the nature of an insurance fee [...]
Is that fact public knowledge? Prior to the tabling of the Auditor General's report, I had never heard anything about the fact that Treasury Board or Immigration Canada considered this fee to be in the nature of an insurance fee. Is that in fact true, or is it more a case of the fee being collected because of the risks involved? Is this fee in fact a hidden tax that people are unaware of? I don't quite understand what this fee entails exactly? People should know why they are being charged a fee.
Associate Deputy Minister, Department of Foreign Affairs and International Trade
Initially, the insurance program was described as a concept for formulating principles on which fees would be established. In most cases, when a Canadian receives a passport, there is no guarantee that he will turn to consular services for assistance.
So in some cases you're going to have a situation where Canadians will receive much more than the $25 value they pay in their consular fee; in some cases they won't receive anything, perhaps for the period they hold a passport. I think that fact is well recognized by Canadians.
When you look at the total program at any given time, as well as over the years, there are going to be times when we're in a slight surplus or slight deficit position. When we looked at the original costs we had calculated and disclosed to Parliament and saw original calculations showing increasing deficits, we didn't move initially to seek an increase in the fee under the User Fees Act because we wanted to see whether that was a trend or that was a momentary fluctuation in the costs.
Liberal
Conservative
John Williams Conservative Edmonton—St. Albert, AB
Thank you, Mr. Chairman.
I'm looking at the beginning of the Auditor General's report here, page 2, and if I can quote, it says:
For the cost-based fees we audited, the organizations varied from those with costing systems and practices that captured the full cost of fee-related activities to organizations that did not know the cost of related activities.
So we have the whole gamut there, Mr. Monette, from departments doing a good job to departments not even aware that they have a job to do. Where is the uniformity?
Comptroller General of Canada, Treasury Board Secretariat
Mr. Williams, clearly in some cases there hasn't been the right work done on costing. I got together last week with the six big departments, and they account for about three-quarters of these fees. There are a couple of others, and when you add them in, you're covering off a very high percentage of the fees. I don't have the exact percentage.
If we can get together and look at the action plans, see if they have systems issues.... Is it that the systems aren't producing the information, or is it that the information is there but they're not properly factoring it in? I think we need some stronger oversight review and coordination with these departments.
Some are doing it well. For example, Parks Canada is doing it well. The Auditor General found that they are doing it well. How is it they can do it well and the others can't?
Conservative
John Williams Conservative Edmonton—St. Albert, AB
That's my question precisely, and I'm asking you. Why is it that some departments don't feel any responsibility for following the rules?
Comptroller General of Canada, Treasury Board Secretariat
Some departments, when it comes to cost accounting, are just doing a better job than others.
Conservative
John Williams Conservative Edmonton—St. Albert, AB
Then where does the buck stop? Does it stop with you?
Comptroller General of Canada, Treasury Board Secretariat
As Comptroller General, I am accountable to make sure that there is proper costing and that people are paying attention to that. Last week when I called the six chief financial officers together--I don't know if they've been called together on that issue before--I told them we were going to get together regularly to talk about the costing systems and so forth.
Conservative
John Williams Conservative Edmonton—St. Albert, AB
Were they apprehensive that you were now engaged, or did they just figure this is more bureaucracy?