Public Accounts Committee on May 25th, 2010

[The Chair, Liberal, Shawn Murphy]

I will now call this meeting to order and extend to everyone present a very warm welcome.

Colleagues, this morning's meeting is going to be on two things, so we're going to divide it in two. The first part of the meeting will be devoted to a continuation of a previous meeting on chapter 8 of the fall 2009 report of the Auditor General: “Strengthening Aid Effectiveness--Canadian International Development Agency”.

As many of you will recall, we started that meeting but because of a vote we only got into it for an hour, so the committee decided to devote another hour or an hour and fifteen minutes to the continuation of the meeting and to questions.

Because we did have opening remarks previously from the Auditor General, Sheila Fraser, who is with us now and is accompanied by John Reed, principal, she does not have opening remarks today.

From the agency, we have with us Margaret Biggs, the president and accounting officer. She's accompanied by David Moloney, executive vice-president. I believe Madam Biggs does have a revised opening statement, although one was delivered previously.

Before calling upon Ms. Biggs to deliver her opening comments, I want to point out that the second part of our meeting will be devoted to a dialogue with six or seven visiting auditors general from countries including Barbados, Guyana, Kenya, Vietnam, and Saint Lucia. Those individuals will be joining us at the table for the last 40 to 45 minutes of the session. I think we can conclude one round and then invite our visitors to the table.

We're very honoured and pleased to have the visiting auditors here. They will be more formally introduced at the start of the second phase of our meeting.

On behalf of every member of this committee and every member of Parliament, I want to extend to each member of the visiting delegation a very warm welcome to Canada and a very warm welcome to this meeting.

Without any further delay, I'm now going to call upon Ms. Biggs for her opening comments. I think we'll be able to do one full round. Then we're going to suspend and invite our distinguished guests to the table.

Ms. Biggs, the floor is yours.

[Margaret Biggs, President, Canadian International Development Agency]

Thank you very much, Mr. Chair. Thank you for the opportunity to return to the Standing Committee on Public Accounts to further discuss the 2009 Fall Report of the Auditor General of Canada as it relates to the Canadian International Development Agency.

When I appeared before the committee in December, I outlined the important progress that CIDA has made to implement the government's aid effectiveness agenda. I also discussed how we are first bringing greater focus to CIDA programming, second ensuring stronger management and sustained implementation, and third streamlining business processes. I indicated that CIDA has already completed many of the changes suggested by the Auditor General. Today, I can report that all the major milestones in CIDA's action plan in response to the Auditor General's report have been met.

Let's discuss the first element, which is bringing greater focus to CIDA programming. Regarding our geographic focus, CIDA has already met its target to concentrate 80% of bilateral aid in its 20 countries of focus, and country strategies for all of them have been approved. As planned, summaries of these strategies are now available on CIDA's Web site. They outline how Canada is responding to each country's specific needs, as identified by the national development plan and poverty reduction strategy. In addition, new country program development frameworks were completed for all of CIDA's country programs in March 2010, right on schedule.

As for thematic focus, CIDA is concentrating on three thematic priorities and strategies. The first two, increasing food security and securing a future for children and youth, have been developed and posted on CIDA's Web site. The third, stimulating sustainable economic growth, will be made public in the near future. CIDA has also completed an extensive review of its multilateral and global programs. Following this assessment, the agency developed its first ever aid effectiveness strategy for these multilateral programs.

Towards the aim of stronger management and sustained implementation, CIDA has put in place its aid effectiveness action plan, which provides the entire agency with clear actions and concrete direction for implementing all key elements of the government's aid effectiveness agenda. The Auditor General recommended that this action plan be taken into consideration in the implementation of each of our country strategies. This was done as part of the preparation of country program development frameworks for individual countries.

As I mentioned in December, CIDA has instituted a policy to guide the use of program-based approaches throughout the agency. Since my last appearance before the committee we have completed a comprehensive assessment of these approaches. This includes the evaluation of programs in Ghana, Bangladesh, Ethiopia, Malawi, Mozambique, and Vietnam, each of which has a significant PBA, or program-based approach, component. Overall, the findings were positive, and the lessons learned are being integrated into our programming. Once again, this evaluation report was completed on schedule.

Another important commitment CIDA met by the end of March was to ensure that we have a robust cadre of in-house specialists to support the agency's program and delivery of initiatives within the thematic priorities. We did this by defining the skills and expertise we needed, identifying the gaps, and developing a plan to align resources to needs through a work assignment process. This process is being followed by intensive recruitment, training, and ongoing professional development. This meets a further recommendation of the Auditor General.

In terms of streamlining our business processes, which we talked about last time, CIDA is driving ahead with reforms to make the agency more efficient. As I indicated in December, a key element of our aid effectiveness action plan is decentralizing more operations to the field. Staffing more positions in the field will allow the agency to be more responsive to needs, make better choices on the ground, and achieve stronger results. Through decentralization, CIDA is ensuring that investment decisions are going to be timely, effective, consistent with the needs and plans of host countries, and better coordinated and harmonized with other donors on the ground. The first wave of full decentralization will begin this summer in five of our countries of focus: Bangladesh, the Caribbean region, Ghana, Tanzania, and Ukraine. This will involve moving out key program and corporate functions, including contracting support, financial advisors, and subject matter specialists, as appropriate. Tied to decentralization is an ambitious plan to modernize all of our business processes. The aim is to reduce the time and effort required to plan, design, and contract projects. To do this, the agency successfully piloted a new competitive business process that cuts processing times for its bilateral projects by up to 70%. This new business process has been mainstreamed throughout the agency since we last met. The agency has also reduced application processing times for its Canadian partnership projects by 60%.

In closing, all the objectives the agency set for itself, and which we reflected in our action plan in response to the Auditor General's report, have been met or are currently on track.

I now welcome your questions. Thank you very much.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Ms. Biggs.

Just before we go to the first round, I want to point out, for the benefit of our visiting auditors and their staff, that this of course is a regular meeting of the Canadian public accounts committee. We're having a hearing on a performance report that was tabled last fall dealing with our Canadian International Development Agency. In the extensive performance report, the auditor made a number of recommendations regarding the effectiveness and efficiency of that agency, and we are now having a hearing.

We heard from the Auditor General previously. We've heard from the Canadian International Development Agency. Now we're going to have questions from the various members of Parliament on the committee, and then after the conclusion, the committee will write a report, and that report will be tabled in Parliament.

I should point out for our visitors that this country has, of course, two official languages. Probably the first and the second member of Parliament will be asking their questions in French, so I'd ask you, if you haven't done so already, to put on your translation devices if you do not speak French. The first and second questions will probably be in French or a combination of French and English.

That's just a little background on the hearing. We'll go now, for the first round of seven minutes, sept minutes, to Monsieur Dion.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Thank you, Mr. Chair.

I want to thank you all very much for being here. This is an extremely important issue. Canada is supposed to be a strong country, a generous country, a country that does more than average. But once again, according to the numbers in the report, we are below average in terms of development assistance as a share of the gross national income. That is unacceptable for a country like Canada. But it is not a matter of money; it is a matter of figuring out what is being done with the money. Is it really being used to help develop and build the strengths of these countries?

My first question is for the Auditor General. Madam, in paragraph 8.10, your audit report states that CIDA does not have comprehensive governing legislation that defines its mandate and role. But, in 2008, Parliament passed the Official Development Assistance Accountability Act. Why was the act, which was passed in 2008, not mentioned in the report or included within the audit’s scope?

[Sheila Fraser, Auditor General of Canada, Office of the Auditor General of Canada]

Thank you, Mr. Chair.

We completed the audit, the on-site work, in May 2009, just shortly after the act had been passed. I think we should have mentioned it in the initial context, but it was not in force when we did the audit.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Your report found that the agency is without direction, without bearings, without a plan, that there is a crippling amount of centralization at the top, that it is in the hands of generalists who do not necessarily understand the more specialized nature of what they have to do.

You made recommendations in two of the three areas: more specialists and more specific action plans with more rigorous criteria. Unless I am mistaken, I did not see any recommendations to make the agency more effective and efficient, and less centralized, so that it decentralizes more operations to the field.

If I am right, why is that, and how do you think your report will help the agency solve that problem?

[Sheila Fraser]

Thank you, Mr. Chair.

When we do audits, we are reluctant to tell departments and the government how they should be structured. So it is really up to CIDA's senior management to determine whether its operations should be centralized or decentralized. Of course, we included in the report statistics on the fact that few operations were decentralized at the time. We can see from the action plan and the remarks of the agency's president that there is a movement towards more decentralization. I think it is really up to CIDA to decide how to structure its operations. Oftentimes—and Ms. Biggs may be able to comment further—financial constraints dictate that operations are centralized rather than decentralized.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Yes, but when you centralize the agency's functions and operations, it does not work if the centre does not know what to do because it has not set clear priorities. The two are connected. You seem to have been a bit too careful. You should have made some recommendations in that regard. It is really a management issue.

Good morning, Ms. Biggs. From your remarks, it seems that you addressed nearly all the items in the report, and I just want to make sure of that in the few minutes I have left. You committed to doing a full review of program-based approaches by March 31, 2010. Is that review done?

[Margaret Biggs]

Yes, it is complete. It was something that had been asked of us by Treasury Board. We completed it and submitted it to the Treasury Board at the end of the fiscal year.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Thank you very much.

As far as country strategies go, you said that the country program development frameworks would be done by March 2010. Did that in fact happen?

[Margaret Biggs]

Yes. The country strategies were completed last fall for the countries of focus. They have been issued on our website. In addition, we have completed what are called country development programming frameworks. They're referred to in the Auditor General's report. These are much more detailed programming guidelines that take into account all the key considerations for what we will actually do, which projects we would undertake, and what results we're trying to achieve. Those were committed to be completed by the end of March 2010 and they were completed in time.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

You have three priorities: increasing food security, stimulating sustainable economic growth, and securing the future of children and youth. On page 22, the report states that “the Agency will complete Agency-wide strategies for each of these thematic priorities by early 2010”.

Was that done?

[Margaret Biggs]

As I mentioned in my opening remarks, two of the three thematic priorities--the first on food security, the second on children and youth--were completed and announced. The details are now on our website. Those were done to the end of 2010. The third, on economic growth, has been completed and will be released shortly.

[Stéphane Dion, Liberal, Saint-Laurent—Cartierville, QC]

Finally, you said that you would define “the necessary skills and expertise required to support programming and delivery of initiatives within these thematic priorities”, in other words, the whole issue of specialized expertise. You said that you would “ensure that a robust cadre of specialists is in place through recruitment, training and ongoing professional development” by March 2010.

Where exactly do things stand?

[Margaret Biggs]

As I indicated, that work has been completed as well, although it will be ongoing. We have pooled together all of the specialist cadre in our geographic programs into one place. We've done a needs assessment relative to our thematic priorities and our program strategies for each country, which we have completed. We've done the gap analysis. We've looked at the needs. We've developed a work assignment process to make sure we're matching supply and demand, if you will. Then we will do it on an ongoing basis--the recruitment and professional development of our cadre. As we move forward with decentralization, we will also be looking at where and when we need to put our specialists out into the field to support our programming there.

[The Chair, Liberal, Shawn Murphy]

Thank you, Mr. Dion.

Mrs. Beaudin, you have seven minutes.

[Josée Beaudin, Bloc, Saint-Lambert, QC]

Thank you, Mr. Chair.

I do not want to go backwards, but CIDA has set out its country development frameworks. How do you explain—for my own benefit as I was not here last year—the fact that documents or country development frameworks were just as important but were not done?

[Margaret Biggs]

CIDA has always had detailed program frameworks for bilateral countries. I think the Auditor General notes in her report that some of them were out of date. That has now been remedied so that they are aligned with the country strategies that have been approved and are posted on our website. They became out of date as the government was developing its new country focus and its new thematic focus. That work has now been completed, so we have new country strategies and new programming frameworks for each of our countries of focus.

[Josée Beaudin, Bloc, Saint-Lambert, QC]

Thank you.

In point 4 on page 2 of the 2009 report, it says that certain weaknesses were identified and that you addressed the needs, requests and recommendations. The report also said that recent years have been marked by frequent changes in policy direction and substantial turnover. I would think that that problem was partly solved and that the agency should not see any major changes in policy direction in the next few years.

In light of that, how are you able to plan operations in the focus countries where you want to take action? How do you plan without specific management frameworks, among other things? Do you have them now?

[Margaret Biggs]

Yes, there is a framework of action in the government. CIDA has identified three key areas of thematic focus, as I mentioned. In each country we are zeroing in on one or two of those areas of thematic focus, with even more focus within the focus in terms of what exactly we would do in each of these countries and what results we would be looking to achieve.

In response to your question, I think we do have a clear sense of our direction, our areas of focus. Those are also being translated into our country strategies, and our programming will follow suit.

[Josée Beaudin, Bloc, Saint-Lambert, QC]

What are your strengths as compared with other donor countries?

[Margaret Biggs]

Thank you for that question.

CIDA has a very strong track record with respect to food security and agricultural development, and therefore I think it's appropriate that those make up one of our areas of thematic focus. I think in recent years, many people have zeroed in on the fact that agricultural development, particularly in Africa, has not been given enough attention. It is an area that CIDA continued to work on in the past and didn't neglect, and it's an area of strength for us in terms of expertise and in terms of programming. It is an area of thematic focus.

CIDA also has quite a bit of expertise in many of the health areas and in basic education. It's been a main contributor to education in many countries. For example, CIDA helped Tanzania to achieve universal primary enrolment. We have very strong expertise in teacher training, and we've used that in many countries, including in Afghanistan, for example. That is also an area of real strength. So those are examples. I think CIDA has also, over the years, been very well known for integrating gender equality into its programming and for being really quite a pathfinder internationally on that issue.

Thank you.

[Josée Beaudin, Bloc, Saint-Lambert, QC]

Is it possible that CIDA could provide the same services as another donor country? And if so, why do you think that is?

[Margaret Biggs]

When we are in a particular country we look to harmonize our work with that of other donors, based upon what the country itself has identified as areas of priority. There is a division of labour that follows, based on who's best able to take responsibility for particular issues. So, for example, in the health sector in Mali or Tanzania, we might be working on health issues with a number of other donor countries in alignment with the country's own health strategy, but our focus would be on a couple of areas, such as, for example, health human resources, in which Canada has particular expertise.

[Josée Beaudin, Bloc, Saint-Lambert, QC]

Very well. Thank you very much.