Public Accounts Committee on March 31st, 2014

[Michael Ferguson]

Again, what we are looking at is whether the spending was incurred for Senate business. I am not going to go down into the particular examples that might be outside of that, but what the money was spent for has to meet the test of being for Senate business for all of the spending that occurred in that two-year time period.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Is an audit done on performance as it relates to Senate expenses? For example, if $50 million is spent and the expectation is—

[The Chair, NDP, David Christopherson]

On a point of order, Mr. Albas....

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

Thank you, Mr. Chair.

I understand Mr. Giguère has questions. Again, the Auditor General is here for the express purpose of discussing the estimates, etc., so while I understand that the member may have questions, those are the questions on which he can seek answers from the Auditor General. We're here to talk about the estimates.

[The Chair, NDP, David Christopherson]

In fairness, we're talking about the work plans of the Auditor General. If it were any subject matter that was covered by the work done by the Auditor General would we give the latitude to pursue it? I think the answer to that would be yes.

I am listening carefully because I know we're getting close to capital P political issues, but I don't hear anything yet out of order.

[Dan Albas, Conservative, Okanagan—Coquihalla, BC]

What's the relevance, Mr. Chair?

[The Chair, NDP, David Christopherson]

The relevance is that it's the work of the Auditor General. That's all we need for relevance.

Mr. Hayes.

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

I agree with Mr. Albas here. This committee has no oversight role with respect to the Senate whatsoever. The Senate has the oversight role with respect to the Senate. I don't believe this committee should be discussing the Senate. Again, it's a matter of relevance. Our oversight role has nothing to do with the Senate. We have an oversight role with all of the other Auditor General's reports, and I don't see that it would be this committee's responsibility to audit the Senate report when it comes out. It's going to be the responsibility of the Senate committee, I would expect.

[The Chair, NDP, David Christopherson]

I don't know about that for sure to tell you what the detail is on that last one.

Nonetheless, we're still talking about the work of the Auditor General. I haven't sensed that the Auditor General is in some kind of political distress because of the kinds of questions, that they're so political as to make it difficult. I am listening carefully. They're fairly straightforward in terms of the kind of audit that's being done. We're talking about the work of the Auditor General. I will continue to listen closely, but I'm not yet satisfied that the member has stepped outside the bounds, given that we do allow as much latitude as possible at committee, but there are lines. I am watching for the lines, but I have to tell colleagues I have not yet sensed that line being crossed.

Mr. Giguère, you're aware of this conversation. I will just ask you to keep that in your mind as you move forward.

Having said that, you now have the floor to continue. Please continue questioning Mr. Ferguson.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Very well.

You said that you were doing a special compliance audit on the Senate. If you were asked to conduct a performance audit, which is much more in-depth and more expensive, would you have the budget to do it?

[Michael Ferguson]

It would be difficult to determine how to do a performance audit on.... I would say whether it's a member of the Senate or a member of the House of Commons, how you do a performance audit on the work that any particular member does would be difficult. So I think that sort of compliance audit looking at the spending and whether the spending was for Senate business probably gets to the core of the important spending that would go on in a senator's office.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

How much time to I have left, Mr. Chair?

[The Chair, NDP, David Christopherson]

You have half a minute.

[Alain Giguère, NDP, Marc-Aurèle-Fortin, QC]

Let's talk about resources. You can meet your obligations with the budget you have, as long as departments co-operate with you, open their books wide and hold nothing back.

I remember a report that was presented by the commissioner of the environment and sustainable development on greenhouse gas emissions. He showed us the tables. I pointed out that he could not make a connection between the budgets spent annually and the reduction in greenhouse gas emissions sought, which was the government's objective. He basically told me that the departments themselves had provided approximate objectives in terms of greenhouse gas reductions. He could not do better because he did not have the relevant information.

Does the fact that the information for some files is not accessible influence your ability to prepare your report within the confines of your budget envelope?

[The Chair, NDP, David Christopherson]

Reply very briefly, please.

[Michael Ferguson]

Certainly for us to do any audit it's always imperative that we get the information we ask for. If we do not get the information we've asked for, we have an obligation to report that to Parliament.

[The Chair, NDP, David Christopherson]

Thank you very much.

Colleagues, just before I go to Mr. Hayes, I want to touch on the point of order because it's an important one. The reference I'm going to make is to O'Brien and Bosc, our bible in the interpretation of our rules. It says, under “Consideration of Estimates in Committee”, page 870:

The discussion on Vote 1 in the main estimates (generally departmental administration or operations) is traditionally wide ranging.... Chairs have generally exercised considerable latitude in the nature of the questioning permitted on estimates.

Lest anyone wants to pursue that further....

Mr. Hayes, you have the floor, sir.

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

Thank you, Mr. Chair.

I guess we do well as a committee, 13 to 14 hearings a year. Outside of doing more hearings, which I would think—given our resources—is impossible, I'm trying to get a sense of whether this committee can do more to assist you with, or follow up on, your recommendations. Because it would appear to me that your only source of follow up is to conduct another complete performance audit. I'm wondering if, as a committee, there might be—even not necessarily along that line of thinking—a way that we could be helping in some way, shape, or form in terms of accountability toward some of the reports that you've conducted without our having the ability to do a hearing, or even after an initial hearing, prior to your having a chance to do another performance audit.

[Michael Ferguson]

I think that if the departments believe they have to submit an action plan to this committee—which I understand they do—on every audit we perform, regardless of whether there's a hearing or not, I think certainly that sends the right message to the departments. Also, we can choose to do a follow-up audit on anything we want at a later point. We can't follow up on all audits, but any input we get from the committee in terms of chapters that would be of interest to the committee for follow up could help as well. I think outside of having the hearings, as long as there's a very clear message coming from the committee that the departments are expected to come up with an action plan, and expected to present that action plan and send that action plan to the committee, that certainly is helpful.

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

Thank you.

One of your four priorities is articulating the value of your audits. I'm hoping you can elaborate on that a little. I'm finding a little discrepancy within your “Indicator Table 1” about value of audits. For the “percentage of departmental senior managers who find our department audits add value”, the target is only 70%. I'm wondering why only 70% when for the board chairs the target is 90% and for audit committee chairs the target is 90%. You had an actual of 79% who thought it added value in 2011-12, yet now you're accepting a target of 70%.

I want to understand this concept of adding value. How are you going to measure that, why the 70%, and what is the value?

[Michael Ferguson]

I think probably the first thing is that, as I mentioned earlier, we are in the process of reviewing our indicators. Do we have the right indicators and do we have the right targets? That process is under way.

In terms of if we are adding value, again, the responses that we are getting back on our surveys indicate that we are adding value, but we feel that we need to try to delve a little deeper into that question to understand what it is about, whether it's a financial audit, a special exam, or a performance audit that does add value, so that when we are doing an audit we can focus on those things.

In terms of why the indicator for senior managers is lower than for chairs and other stakeholders, I think that's a recognition that sometimes when we are doing an audit it can end up being an uncomfortable position for management. So at the end of that process, while the audit committee may very well feel that this added value, I think that's giving us a little bit of a buffer because there are sometimes some managers who are not necessarily unhappy with the outcome of the audit, but are maybe not particularly happy that they were the subject of an audit.

[The Chair, NDP, David Christopherson]

You have less than ten seconds.

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

Ten seconds....

Quickly, your recommendations were up in terms of being reviewed. They were up from 62% to 72% on one audit and they were up on the performance audits as well. What do you attribute that increase to? It seems like a fairly substantive increase.

[Michael Ferguson]

I think I would just say that departments, if they feel they are going to be held accountable for putting the recommendations in place, the more they feel the pressure to put the recommendations in place, the better that compliance rate is going to be.

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

Thank you, Mr. Chair.