Public Accounts Committee on April 21st, 2009

[Wayne Wouters]

Yes, every budget item, except those that were not in the Budget Implementation Act. The Budget Implementation Act itself was approved by Parliament. Now, the terms and conditions of those programs in the Budget Implementation Act, and all other budget items, had to come to the board for approval and ratification.

[Andrew Saxton, Conservative, North Vancouver, BC]

Does Mr. Smith want to add anything to that?

[Alister Smith]

The only thing I would add is that we are also undertaking quarterly reporting. The first report was provided in March, and there'll be another report in June, followed by reports in September and December. These are fairly comprehensive. We are gathering information from departments on progress, on initiatives, the flow of funds, results. So that's another way in which we're trying to ensure good government in the implementation of the budget implementation package.

[Andrew Saxton, Conservative, North Vancouver, BC]

Okay. And these expenditures are limited to the programs and projects outlined in budget 2009. Is that correct?

[Alister Smith]

Yes, that's correct.

[Andrew Saxton, Conservative, North Vancouver, BC]

Thank you very much.

My next question is with regard to the management accountability framework, and specifically how the framework is used practically to improve management. Who uses the framework? How are the results used? Have there been any improvements in the framework?

[Wayne Wouters]

The management accountability framework is simply that. It is a framework that has been adopted now by all departments and agencies in the Government of Canada to manage their organization. It has 10 areas of management, and we at the board undertake on an annual basis an assessment of performance along those areas of management. In fact, there are 21 different areas of management within those 10 broad management categories where we undertake our assessment.

The purpose of that is to have a dialogue with the executive team and the department to determine areas where we can see improvement. For each area of management, we assess five areas from very strong to needing improvement, and in undertaking those assessments, our so-called policy centres—in Rod's area in financial management, he will determine what is required to basically achieve “strong” versus “acceptable” and what various processes or systems or approaches need to be put in place to achieve a good, solid score. That work is largely done by what we call our policy centres working with the individual departments. In order to look at financial management, it's Rod working with the chief financial officers to say what is a good level of excellence for financial management. Then we try to measure on that basis.

We do that in each of the areas. How do we use it? As I said, we use it to work with departments to determine areas where they can improve. We can also use it, since we do it right across government, to look at what areas of management we are relatively strong performers in and what area we may need to look at more horizontally to improve the overall level of management. For example, right now information management is not as strong as financial management. Then we work with the community and ask how we can improve our performance overall in that area.

[Andrew Saxton, Conservative, North Vancouver, BC]

Are you aware of other countries that have a similar framework in place? And if so, are we looking at those to improve ours?

[Wayne Wouters]

We're undertaking a five-year review right now of MAF, and part of that review was for our consultants to look at other models. The British have a model that is somewhat similar. The Americans do as well. We like to think that ours is more advanced, but maybe I'm biased. Ours has been in existence for a long time now, about six years. They do measure slightly differently, and there are some lessons that we can learn, and that's what we're trying to do through our five-year review.

[Andrew Saxton, Conservative, North Vancouver, BC]

Maybe other countries are looking at ours as well.

[Wayne Wouters]

They are doing that. We have a lot of people from a lot of countries coming to look at our model, and a number of countries have in fact adopted our model.

[Andrew Saxton, Conservative, North Vancouver, BC]

Thank you.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Mr. Saxton.

I have just a couple of issues I want to pursue, Mr. Wouters.

First of all, these are issues that have been before the committee. The first one, of course, has been the concern, and I sense there is some improvement in the tenure of deputies. The statistic I had four or five years ago was that their average tenure was a year and a half. It has been the view of this committee that these are large, complicated departments that you can't run when you are turned every year and a half. To give you an example, we've had 12 deputy ministers of Indian and Northern Affairs in the last 20 years. The Royal Bank can't operate on that basis, Shell Oil can't, and I don't think the Department of Indian Affairs and Northern Development can--although, in fairness, Mr. Wernick has been there close to three years now, so that's a very positive development.

Mr. Wouters, has there been a change in the policy on this issue? I don't know the latest statistics, but this was a concern of the committee. Do you sense that there is a change in the government policy dealing with the tenure of deputy ministers?

[Wayne Wouters]

I'm not certain if there is a specific policy in this area. This committee has been very clear on its position. It has been an important discussion, because my sense is that the government and the Clerk of the Privy Council, who makes recommendations to the Prime Minister on the appointment and tenure of deputies, have been working very hard to try to extend the time period. So I don't think we have a specific policy per se, but the intent is to try to extend that tenure.

I'm a case in point. I've been the Secretary of the Treasury Board now for almost five years. Prior to that I was Deputy Minister of Fisheries and Oceans for five and a half years. There are a few cases. There have been cases where people have stayed quite long. It's true that if you look in the past there are some who have moved relatively quickly, but the statistics show that tenure is increasing.

[The Chair, Liberal, Shawn Murphy]

Another issue I want to clarify, Mr. Monette, is on the internal audit. As you know, the Financial Accountability Act did indicate that all departments and agencies would be compliant by April 1. Has that been the case?

[Rod Monette]

We're not exactly there. If you look at the big departments, the top 23 that account for about 95%, we're on 21 out of 23 right now. There are two to go, and I expect number 22 next month. Probably one is straggling by a couple of months, but we're very close. Then some smaller departments need to comply. There are another 23, and we're on 20 out of 23. If you add that all up we're at about 41 out of 46 right now, but we're pretty close.

Through the budget period the last couple of months, a lot of these people were put on committees because of Treasury Board submissions, and a lot of the business of the Treasury Board has gone to the budget issues, and so I've given a little bit of leeway for a month or two for some of these folks, but we're very close. The ones that are up and running are running very well.

[The Chair, Liberal, Shawn Murphy]

Do you see the whole thing being compliant by Christmas?

[Rod Monette]

Yes, absolutely.

[The Chair, Liberal, Shawn Murphy]

Back to you, Mr. Wouters.

The last concern I want to raise at this point is the departmental performance reports. Again, this has been a concern in this committee. For any department or agency that comes before the committee, I certainly take the opportunity to read the departmental reports on plans and priorities and the departmental performance report for the previous year. This issue has been raised before by the Auditor General in her audit in 2004. They're not that helpful in a lot of cases. There are a lot of self-congratulatory statements, a lot of fluff, but it really doesn't get to the goals and objectives of the department in what they're trying to accomplish, or the tremendous risks that certain departments are facing, and how they meet the challenges and risks. We've seen horrendous situations. For example, Public Works had a horrendous situation going on four or five years ago about events that bordered on criminal. It was a large department within Public Works with an internal audit on subcontracting. I asked why they didn't mention it in the departmental performance reports, and they just shrugged their shoulders.

Again, I know you're working on it, but perhaps you can update the committee as to where you see this process going.

[Alister Smith]

Thank you.

We have been working very hard on RPPs and DPRs for some time and taking advice from this committee and the Auditor General. We do issue guidance to departments such as this and a good practice handbook as well. We do stress the need for departments to be fairly balanced and forthright in their assessments. We've tried to outline very clear performance measures. We've tried to make sure these reports are not fluff but are based on plans and assessing actual results against the plans. We were able to do that better perhaps on the program side than with the objectives and programs dealing with some of the other issues and problems you might have mentioned.

[The Chair, Liberal, Shawn Murphy]

Thank you very much.

We're going to go to the second round. It's going to be somewhat abbreviated, and I'll go down to four minutes. Unfortunately, I'm going to have to be very tight on the time. If either the Liberal Party or the Conservative Party wants to combine their time and take eight minutes instead of four, that's fine with the chair.

Mrs. Crombie, you have four minutes.

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

I have so many questions.

Thank you all for joining us.

As the opposition, we're always concerned about the government's accountability, proper planning, transparency, policy, delivery, execution of promises, and competent management. I too want to go back to the economic stimulus plan and discuss it with the Treasury Board once again. As we know, it provides for extraordinary spending authority and thus we want to see extraordinary disclosure, transparency, and accountability. I have a list of questions.

Are we certain we have the right priorities? Mr. Saxton has already addressed the accountability, but we have to go back to whether the proper checks and balances are in place. I have to better understand what the urgency and the need for this fund is when you tell us you're still gathering information. You're still doing due diligence and putting a proper structure in place.

Let's start there and see how far we get.

[Alister Smith]

Thank you very much.

In terms of the right priorities, what is being implemented here is the budget, which of course Parliament has approved. The initiatives that are being implemented and funded here have already been approved by Parliament, and that includes TB vote 35. These are all budget initiatives, and many of them will show up as well in the supplementary estimates. Of course, Parliament has passed the Budget Implementation Act with $10 billion worth of measures, which are all in the budget.

The urgency here, I think, is obvious in the sense that there's an economic crisis. There's a need to offset that as best we can with timely and targeted spending. I think that's the reason for the scale as well as the speed with which the budget is being implemented.

[Bonnie Crombie, Liberal, Mississauga—Streetsville, ON]

I understand the budget has been implemented, but what I don't understand is the need for the $3 billion with vote 35. Can you assure us that regional equity, regional fairness will be employed and that there will be a fair distribution of funds? How certain are you that the funds will be drawn down?

[Alister Smith]

I'll try just on the regional equity side, and Mr. Wouters may want to add more.

In this reporting that we're undertaking—and we've already produced one report in March at the Department of Finance and Treasury Board—based on information from departments, we'll gather information on the regional distribution of benefits from the economic stimulus plan. So we will be reporting on that as we go forward.