Public Accounts Committee on Feb. 23rd, 2021

[The Chair, Conservative, Kelly Block]

I will call our meeting to order.

Good morning everyone and welcome to meeting number 20 of the Standing Committee on Public Accounts.

I have a special welcome for MP Shanahan who is joining us today. As was noted, I think we still refer to the table at the end of our reports as the Shanahan table. That is a legacy of her time on this committee. I concur. It's an excellent committee so far. I'm new to this committee. So far it has been a joy being on this committee, certainly with our colleagues and the support that we have. Having been a member for 12 years, I would say that we have a really tremendous public service that serves us in our committees. They do great work,

The committee is meeting in public today to study “Report 4—Oversight of the Government of Canada Advertising” of the 2019 spring reports of the Auditor General of Canada.

As you are all aware, today's meeting is taking place in a hybrid format pursuant to the House order of January 25, 2021. Therefore, members may be attending in person in the room or remotely using the Zoom application. However, I do know that everybody is joining us virtually today. I do want to thank all of our witnesses. You were all online and tested well ahead of time. That is very helpful for our meeting, so thank you.

I have a few reminders for our members. Interpretation services are available for this meeting. You have a choice at the bottom of your screen of “floor”, “English” or “French”. Before speaking, click on the microphone icon to activate your own mike; otherwise, you will owe Matt Green some money. When you are done speaking, please put your mike on mute to minimize any interference.

When speaking please speak slowly and clearly. Unless there are exceptional circumstances, the use of headsets with the boom microphone is mandatory for everyone participating remotely. Should any technical challenges arise, as we've seen even at the beginning of this meeting, please do advise me and note that we may need to suspend for a few minutes to ensure that all members are able to participate fully.

I now would like to welcome our witnesses.

Joining us today from the Office of the Auditor General are Andrew Hayes, deputy auditor general, and Michelle Salvail, principal.

From the Department of Public Works and Government Services, we have Bill Matthews, deputy minister, and Jean-Pierre Blais, assistant deputy minister of the receiver general and pensions branch.

From the Treasury Board Secretariat, we have Peter Wallace, secretary of the Treasury Board of Canada, and Kelly Acton, assistant secretary in strategic communications and ministerial affairs.

Welcome, all.

I will now turn the floor over to Mr. Hayes for five minutes.

[Andrew Hayes, Deputy Auditor General, Office of the Auditor General]

Madam Chair, thank you for this opportunity to discuss our report on the oversight of Government of Canada advertising. This report was tabled in Parliament in May 2019. Joining me today is Michelle Salvail, who was responsible for the audit.

The Government of Canada uses communications to inform the public of its programs and services. A message is considered advertising when the government pays to place it in either traditional media such as newspapers, television, radio or billboards, or digital media such as websites or social media platforms.

In 2016 the Government of Canada introduced in its policy on communications and federal identity a definition of non-partisan communications that includes advertising. The government also put in place the requirement that all advertising campaigns with a budget of more than $500,000 would be subject to an external review for non-partisanship, as assessed against a set of criteria that has been specified.

Our audit focused on whether the Treasury Board of Canada Secretariat and Public Services and Procurement Canada were ensuring that the government's commitment to non-partisan advertising was being met. Overall, in our view, the government's oversight of advertising was not sufficiently robust to ensure that no public funds were spent on partisan advertising.

The Treasury Board of Canada Secretariat did not assess risks beyond cost when it set out the external review process for campaigns with budgets exceeding $500,000. In other words, the threshold was based on just the value of the campaign. The secretariat did not consider other important risk factors, such as the campaign’s audience reach or topic. For example, a campaign can cost little but carry more risk because it focuses on a politically sensitive topic, like medical assistance in dying, while an extensive information campaign on a neutral topic, such as handwashing, will cost much more but be less likely to involve political colouring.

We also found that the secretariat did not monitor the quality of the external reviews conducted by Ad Standards, the not-for-profit organization mandated by the secretariat to conduct the reviews. In reviewing files provided by the secretariat, we found little evidence of the analysis conducted to support the assessment of campaigns against criteria. This gap in monitoring means that the secretariat may have missed opportunities to identify and rectify weaknesses in the oversight process.

Public Services and Procurement Canada, or PSPC, reviews campaigns that fall below the $500,000 threshold to ensure that they comply with policy and legislative requirements, including those for non-partisanship.

We found little evidence that the department conducted consistent and thorough reviews against all non-partisanship criteria. For example, we found no indication that reviewers took steps to confirm that statements and statistics presented in campaigns were factual, even though the government's policy on communications and federal identity sets out that non-partisan communications are to be objective, factual and explanatory.

We made five recommendations to the Treasury Board of Canada Secretariat and one to PSPC. Both organizations agreed with our recommendations and prepared action plans. According to the timelines set out in these plans, all our recommendations should have been addressed at this time.

Although we have not conducted additional audit work since 2019, I do want to note that some changes have been made to the external review process. For example, the threshold for sending a campaign for external review has been lowered to $250,000. The committee may wish to ask the Treasury Board of Canada Secretariat whether its analysis of risk factors other than cost has led to other changes to the process.

Since our audit was completed, the government's website shows that more than 50 additional campaigns underwent a mandatory external review, including those related to the COVID-19 pandemic. We also note that review results posted since our audit identify more instances of non-compliance with criteria such as accuracy, factualness and objectivity. We take these results to be an indication of the positive impact of our work.

Madam Chair, this concludes my opening remarks. We would be pleased to answer any questions the committee may have.

Thank you.

[The Chair, Conservative, Kelly Block]

Thank you very much, Mr. Hayes.

We will now move to Mr. Matthews for five minutes.

[Bill Matthews, Deputy Minister, Department of Public Works and Government Services]

Thank you, Madam Chair, and good morning, members. Thank you for the invitation to be with you today to discuss the Auditor General's spring report from 2019 on oversight of Government of Canada advertising.

Today, I am pleased to provide an update on the actions taken by PSPC in response to the Auditor General's recommendation that pertains to our department.

As the chair already mentioned, I have with me Mr. Jean-Pierre Blais—

[Maxime Blanchette-Joncas, Bloc, Rimouski-Neigette—Témiscouata—Les Basques, QC]

I have a point of order, Madam Chair.

I'm not getting any interpretation for Mr. Matthews's comments.

[The Chair, Conservative, Kelly Block]

My apologies, but could you repeat that, Mr. Blanchette-Joncas?

[The Clerk of the Committee, Ms. Angela Crandall]

There's no interpretation. We're checking it.

[Bill Matthews]

Madam Chair, shall I pause?

[The Chair, Conservative, Kelly Block]

Yes, please.

[The Clerk]

It seems to be okay now, so let's try it.

[Bill Matthews]

All right, Madam Chair.

I'll start over.

[The Chair, Conservative, Kelly Block]

I believe it's corrected, so please go ahead.

[Bill Matthews]

Thank you.

Good morning, Madam Chair and committee members. Thank you for having us here today to discuss Public Services and Procurement Canada's response to the spring 2019 audits of oversight of Government of Canada advertising, which were undertaken by the Auditor General of Canada.

As the chair already mentioned, I am accompanied today by Mr. Jean-Pierre Blais, who is the assistant deputy minister responsible for PSPC's work in this area.

Madam Chair, Public Services and Procurement Canada is committed to ensuring that advertising by Government of Canada departments is non-partisan in nature and to playing our role in that regard. We accepted and followed through on the recommendation that we should provide clear direction and training to our advisers on how to conduct reviews of Government of Canada advertising to ensure non-partisanship.

Today I will provide a brief overview of the role that Public Services and Procurement Canada plays in the oversight of the Government of Canada advertising process as well as how we have taken action to support the goals outlined in the recommendation from the Office of the Auditor General.

Communication with Canadians, which includes advertising, is central to the Government of Canada’s work and contributes directly to the Canadian public’s trust in government. Government advertising can help to convey important information about policies, programs and services, as well as information about Canadians’ rights and responsibilities under the law, and information to help protect their interests and well-being.

PSPC provides advisory services and technical advice with respect to legislation and policy requirements, including the federal identity program, official languages and non-partisanship. In so doing, we review all advertising materials submitted and, where appropriate, provide advice to departments in that regard.

With respect to the non-partisan review process, campaigns with a budget of over $250,000—and I appreciate that it was $500,000, I believe, when this audit was undertaken—must undergo a third party review process which PSPC coordinates. Those with a budget under this threshold may be formally reviewed at the discretion of the advertising department.

Regarding the recommendation directed at PSPC, after a review of PSPC files and documentation, the Office of the Auditor General recommended that the department undertake training on how to conduct reviews, including documenting the rationale for assessments.

I'm pleased to report that's exactly what the department has done.

The Auditor General's report made six recommendations with respect to the non-partisan oversight mechanism, of which one, in paragraph 4.51, was directed at PSPC. The recommendation was that Public Services and Procurement Canada should provide clear guidance and training to its half-dozen advisers on how to conduct their reviews, including documenting the rationale for their assessments of all non-partisanship criteria. Following this recommendation by the Office of the Auditor General, with which we wholeheartedly agree, PSPC immediately undertook to create and update training materials and checklists for all of our advisers. This work was fully completed by December 2019.

As part of this work, PSPC developed a process map for the non-partisan review process to support the advisers in the consistent review and documentation of advertising, which was completed in October 2019. This process map was presented to all advisers to ensure they had a clear understanding of the process and that it could be applied in a consistent manner.

A checklist was also developed that includes steps connected to the non-partisan review criteria. This work was also completed in October 2019.

Finally, the new advertising management information system, which has been procured and is now being configured, will allow for all relevant documentation to be stored in the system itself, including a step uniquely associated with non-partisan reviews.

These enhancements to our processes have been implemented and are fully operational.

Madam Chair, I assure you that PSPC is fully committed to its responsibilities in this area and has implemented our response to the recommendation issued by the Auditor General in this aspect. Our guidance and tools have been fully updated to support the consistent application of legislative and policy requirements related to the non-partisan advertising.

I'll leave it there so we have enough time for questions.

We are really looking forward to your questions.

Thank you, Madam Chair.

[The Chair, Conservative, Kelly Block]

Thank you very much, Mr. Matthews.

We will now go to Mr. Wallace for five minutes.

[Peter Wallace, Secretary of the Treasury Board of Canada, Treasury Board Secretariat]

Thank you, Madam Chair.

As you indicated, I am joined today by Kelly Acton, who serves as the assistant secretary for strategic communications and ministerial affairs at Treasury Board Secretariat.

After my brief remarks, Ms. Acton and I will look forward to answering any questions from you and the committee.

The subject of today's meeting is, of course, the study of the non-partisan review process for government advertising, one of five reports presented by the Auditor General during the spring of 2019. As we've already indicated, this review process was implemented in 2016.

The Treasury Board Secretariat has addressed all of the recommendations outlined in the 2019 spring report of the Auditor General. I'll simply review those recommendations and then look forward to your questions.

The first recommendation was to consider a risk-based approach to identify campaigns with the higher risk of partisanship. At issue in this recommendation is a determination of what is the best indicator of risk. To date, advertising spend and the total of that spend has been the best indicator.

After an analysis of the review process, it was concluded that a consistent dollar-based target remains the most reliable indicator of risk. That threshold has now been reduced for mandatory review of ad campaigns from $500,000 to $250,000. This reflects the changing nature of the industry and a trend toward somewhat lower dollar amounts in the use of digital media in advertising campaigns. This approach is designed to capture at least 80% of the government's annual advertising budget.

The second recommendation was to ensure that the Ad Standards, the external third party review mechanism, documents the rationale for its assessment of government advertising campaigns against all non-partisan review criteria. In response, the new evaluation form for Ad Standards to assess ad designs and better document their findings has been developed by Treasury Board officials and implemented in this process.

The third recommendation was to assess the appropriateness and application of the two-stage review process to ensure that it is effective and works as intended. The process is set up to ensure that ads are reviewed twice: first, early in the production process and then before actually going to market. This allows any creative work to be reviewed and modified, if necessary, before additional costs or delays are introduced into the process.

Officials found that, depending on the type of media used in the advertising, the period of time between the reviews fluctuated. Based on those findings, it was determined that the process was working as intended and did not in fact need to be changed. Informed by work on this recommendation, guidance was developed to ensure departments plan the timing of their review request to Ad Standards. This guidance was shared with departments and is also posted on Canada.ca.

The Auditor General's fourth recommendation was to improve how officials monitor ad campaign reviews and whether Ad Standards is thoroughly and consistently applying all non-partisan criteria in its reviews. In the fall of 2019, a panel consisting of officials from both Treasury Board Secretariat and Public Services and Procurement Canada began assessing a sample of Ad Standards' reviews each quarter and determined that Ad Standards was applying the criteria consistently. This oversight is, of course, ongoing.

The fifth and final recommendation called for an independent, objective review process to receive, review and respond to public complaints about partisanship in government advertising. In 2020, after looking at options, including the feasibility of implementing an independent review complaint process, a pilot project was established to accept, review and report on public complaints in this area. The public can now submit a complaint online about any Government of Canada advertising that they may feel is partisan. The nature of the complaint and findings of the review would then be posted on Canada.ca.

Treasury Board Secretariat is committed to ensuring that there continues to be an independent and strong oversight of Government of Canada advertising. The audit identified process gaps and not substantive deficiencies in oversight. As noted, these recommendations have been addressed.

Ms. Acton and I are, of course, prepared to answer your questions.

Thank you very much.

[The Chair, Conservative, Kelly Block]

Thank you very much, Mr. Wallace.

We will now go to our first round of questioning. It is a six-minute round.

We will start with Mr. Lawrence.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Thank you very much, and thank you to all the witnesses for appearing.

My challenge with this overall review is that in first-year law school we all learned about Lord Denning. One of the things he would say is that it was not the biases he was aware of that would scare him; it was the biases that he was not aware of.

When we look through this process, I understand that the tree breaks out into two: it was at $500,000 and now it's $250,000. However, I'm troubled that we're perhaps not getting results.

I just want to first confirm that we have 2020 numbers when it comes to reviewing that. Do we have those numbers now? This report was done for 2019.

Can anyone answer?

[Bill Matthews]

Madam Chair, maybe I could share that the government's annual report on advertising for 2019-20 is now public. That's the most recent publicly available information on government advertising spending.

I'm not sure if that helps the member with his question, Madam Chair.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Yes, that's fine. We'll use those numbers.

Mr. Wallace or Mr. Matthews, how many advertising campaigns were reviewed?

[Kelly Acton, Assistant Secretary, Strategic Communications and Ministerial Affairs, Treasury Board Secretariat]

I'd be happy to jump in, if I might.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Yes.

[Kelly Acton]

In terms of 2019-20, Ad Standards will have reviewed just over 1,800 creatives from 33 campaigns.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

How many of them were subsequently changed?

[Kelly Acton]

In the course of that review, there were three issues identified of the campaigns that were reviewed.

[Philip Lawrence, Conservative, Northumberland—Peterborough South, ON]

Of those reviews, how many were done by non-affiliated people who do not receive a cheque in any way, shape or form from the federal government?