Public Accounts Committee on April 13th, 2021

[The Chair, Conservative, Kelly Block]

Thank you very much.

We will now move to Ms. Vignola for six minutes.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you, Madam Chair.

Ms. Hogan, thank you for being here. I am standing in for Mr. Maxime Blanchette-Joncas, who is taking part in a virtual event in his riding. He sends his regards.

I was gobsmacked when I read your reports, especially the one about the Government of Canada's level of preparedness for the pandemic we are currently facing. I did not think a country could be ill-prepared after the SARS outbreak had sounded such a serious warning. It is unthinkable that Canada was not prepared—Canada, a country that, for years, had been a world leader in emergency preparedness and disaster modelling. It really is inconceivable. Nevertheless, a few weeks into the pandemic, you must have realized, as I did, that Canada was not prepared.

How possible do you think it is that the Public Health Agency of Canada can regain its reputation in disaster prediction and modelling?

[Karen Hogan]

I'll start with a recap of the report to highlight the four areas where we noted the Public Health Agency of Canada was not as prepared as it could have been. Then, I'll talk about measures the agency can take.

We noted that the agency should have been better prepared in four areas.

First, the emergency and health response plans were not updated. What is even more concerning is that the federal-provincial-territorial public health response plan for biological events had not been tested.

Second, we noted long-standing gaps in public health data sharing between the federal government and the provinces and territories.

Third, we noted that a risk assessment tool had not been designed to consider pandemic risk.

Fourth, the agency had neither contemplated nor planned for quarantine on a nationwide scale.

After the SARS and H1N1 influenza outbreaks, as well as Auditor General reports released in 1999, 2002 and 2008, the agency was aware of long-standing shortcomings that it needed to address. That shows the agency placed little value on, and did not pay enough attention to, preparing for emergencies, investing in appropriate systems and taking the time to adequately test plans for deficiencies. The importance of those efforts is underestimated until a new emergency arises.

Now is the time to focus on those areas on a nationwide scale. To ensure it is adequately prepared, the agency must take into account all aspects of the response to a national health crisis and not wait for another to arise before taking action.

It is worth noting that public servants worked very hard. They responded and did their best to fill the gaps. Nevertheless, the agency needs to be better prepared for the next crisis.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you.

Public servants have stepped up, but red tape seems to be slowing down the process. Should we be worried about the effect the red tape is having?

A decade or so ago, a previous government shut numerous scientists out of the decision-making process. Is the current situation a direct result of that?

[Karen Hogan]

In our audit on pandemic preparedness, we did not examine staffing or administrative processes at the agency to determine whether the deficiencies were the result of understaffing or staffing changes. I wouldn't say that is where the problem lies, though. I think the focus really needs to be on investing in appropriate systems and ensuring better preparedness.

It could be argued that no country was as prepared as it should have been, but that doesn't make it acceptable for Canada.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Now, I'd like to turn to the investing in Canada plan. Your findings are rather troubling. They cast serious doubt on the government's ability to manage public funds. I don't mean to be alarmist, but I do worry that we may eventually find out the specifics of the program were questionable.

Can you quell my moral concerns and assure me that you will be able to scrutinize the entire program? That brings to mind the mammoth task undertaken by Ms. Fraser some 20 years ago. Can you assure me that your office has the necessary resources to address the challenge of following up on these reports? I realize it's a huge undertaking, but is your office ready for the challenge?

[Karen Hogan]

Our office is always ready to meet the challenge of auditing programs big or small, whether they are administered by one or more departments.

We are very pleased to tell you that we received the additional funding we had requested, and right now, we are staffing up so we can perform the necessary follow-up and audit work.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you, Ms. Hogan.

[The Chair, Conservative, Kelly Block]

Thank you very much, Ms. Vignola.

We will now move to Mr. Green for six minutes.

[Matthew Green, NDP, Hamilton Centre, ON]

I want to begin with what I believe to be a summary of the findings, and then I'll ask Ms. Hogan to comment.

Essentially, government inaction led to lack of preparedness. There were key elements of a pandemic response that were not in place, including things as basic as ensuring that PHAC received timely, complete and accurate information about COVID-19 cases. PHAC failed to conduct formal pandemic risk assessments once required to do so, which was a serious error that led to systematically underrating the risk until we were already in a full-blown pandemic, which was a fatal mistake. PHAC failed to prepare for nationwide quarantine measures, which led to wholly inadequate capacities to follow up with travellers and with law enforcement agencies.

Ms. Hogan, you referenced SARS and H1N1. We heard my colleague talk about perhaps there being too much red tape and bureaucracy. I would argue that scientists are in our bureaucracy, and that based on our own knowledge, reports and recommendations, all of this was ignored.

Would you care to comment on what I have summarized as principal failures? Would you agree with them, and would you care to expand on them?

[Karen Hogan]

The way I would summarize our audit report on the pandemic preparedness is very similar to how you would. The agency was not as well prepared as it could have been in those four key areas. There was some work done, so I think it's a bit of a balance. There was some work done on emergency plans, but they had not been updated for quite some time, which is not okay. More importantly, the major response plan—the federal-provincial-territorial one—had not been tested, and testing of a plan is incredibly important to identify gaps or weaknesses or lack of capacity.

Definitely, the long-standing issues about data sharing impacted the country's ability to respond in a timely way to the pandemic. For many years, it had been known that agreeing on ways to share information among the federal, provincial and territorial governments was needed, including the IT infrastructure to handle such volume. None of that had been addressed prior to this pandemic, and it needed to be addressed to find solutions during the pandemic.

The third thing was the risk assessment tool. While they did use a risk assessment tool, we found that it was not a tool that considered a pandemic risk. What does that mean? It only considered how the virus might spread once it was here, and not necessarily the risk of the virus coming here and then spreading, so that forward-looking pandemic risk tool was needed. Hence, as you say, it kept the risk rating at “low” until the chief public health officer, in mid-March, stepped in to ask that it be elevated.

Finally, they hadn't contemplated such a scale of a quarantine. There had been quarantines in previous health crises, but not to this magnitude. Again, the agency knew that it didn't have the capacity and hadn't preplanned for dealing with that, and it had to ask for support and help during the pandemic. Unfortunately, they ended up, at the beginning, by being unable to tell us whether or not two-thirds of travellers had properly quarantined.

I believe it highlights a few things. One is the importance and the value of planning and being better prepared. We shouldn't underestimate that. Second, I think it also helps highlight that when you use tools or machine intelligence, as they did for the risk assessment, human judgment needs to be applied to it to make sure it's thinking about all of the factors and not just the ones that might have been input to the tool.

[Matthew Green, NDP, Hamilton Centre, ON]

I can't reconcile the fact that coming out of SARS.... I think about the absolute abject failures, the scandal of our national emergency strategic stockpile and the way that all of those key elements were discarded in 2019, and PHAC's failure to prepare for nationwide quarantine measures.

I can't imagine how, coming out of SARS and H1N1, having read reports—and I believe Dr. Tam was actually involved in these preliminary reports—how they've completely and utterly failed to progress on the recommendations that have been made from past audits.

[Karen Hogan]

Your reaction is one that I highlighted in a message that I gave to Parliament that really underscores the importance of acting on known issues. I could use an example other than pandemic preparedness. If I look at indigenous matters, I can see that many of my predecessors have been raising concerns around indigenous matters, and my first reports earlier in February did the same thing.

I think that this is an aspect in pandemic preparedness that we've highlighted all the way back to 1999. It is, I think, the fact that some of it is what we'll call “back office”, right? Having plans in place and doing a tabletop exercise doesn't seem that relevant, but it really is, because it highlights exactly some of the matters that we lived through in the early stages of the pandemic and it would have allowed the agency to hopefully change its response.

Unfortunately, we'll never know if it—

[Matthew Green, NDP, Hamilton Centre, ON]

I'll just share in my closing remarks that we're into the third wave. We're a year and a half into this, and I have deep concerns that this government—and all levels of government, for that matter, including provincial and territorial—are still completely and wholly incapable of dealing with the variants and the ways in which this virus is mutating. I do have grave concerns, and I appreciate the fullness of this report.

Thank you, Madam Chair.

[The Chair, Conservative, Kelly Block]

Thank you very much, Mr. Green.

We will now move to our second round of questioning, starting with Mr. Webber. You have five minutes.

[Len Webber, Conservative, Calgary Confederation, AB]

Thank you, Madam Chair.

Ms. Hogan, I need further clarification on some comments you made in your opening remarks, particularly with regard to the Canada emergency wage subsidy.

I know it was important for Finance Canada and the Canada Revenue Agency to get the help out quickly to these businesses throughout our country. It was vital, absolutely. However, you indicated some concerns, particularly with the subsidy applications and the way businesses were filling out these application forms to get their funds. You said, “To prioritize issuing payments, the Canada Revenue Agency chose to forego certain controls” that could have been used “to validate the reasonableness of subsidy applications.” Then you gave an example—that they decided not to ask for social insurance numbers—and you say that “this information could have helped prevent the doubling-up of applications for financial support.”

My question is this: Why did they choose to not ask for social insurance numbers? What did they use, then, to prevent the doubling up of applications for financial support?

[Karen Hogan]

What we did find here was that the Canada Revenue Agency and the Department of Finance worked in really tight timelines to design a wage subsidy, one that's never been seen in Canada before. The goal of that subsidy was to try to maintain the employer-employee relationship, to keep individuals working and to allow businesses to be better prepared for the reboot of the economy.

The focus in this case, as well as for the Canada emergency response benefit, was on getting payments out in a timely way. The government chose what is known as an international best practice in emergency situations: to focus less on prepayment controls—which it typically would do to vet eligibility and applications—get money out in order to provide support, and focus on post-payment controls. That just underscores the importance of the post-payment work and why, for both of these programs, my office will go back and do audits to look at that post-payment work.

When they chose not to ask for those social insurance numbers in the example you asked about, it was for a few reasons. One reason that this decision highlighted was the fact that their IT systems had some weaknesses, and they couldn't handle some of the data and the cross-comparability. Another was a lack of timely tax information, in that they weren't able to vet revenues from the prior years beforehand since so many filers had not filed, for example, their GST returns, which would have provided evidence of revenues the year before in order to demonstrate a decline in revenues.

Really, the decision was made by the Canada Revenue Agency to prioritize support and to deal with all of these potential issues through post-payment verification work. They've noted that it will take several years to get through this work, and that is why we will be auditing it early on to make sure that it has some good controls and some good mechanisms in place.

[Len Webber, Conservative, Calgary Confederation, AB]

I see.

Are you saying that the agency did not do any type of control at all with respect to these applications? They just basically gave what was asked for on the application?

[Karen Hogan]

No, they did have some automated prepayment controls up front. Both the wage subsidy and the Canada emergency response benefit had a few up front, but not the typical stronger due diligence they would have done normally when handing out subsidy payments. It means there is the potential that some payments were made in error or to ineligible applicants, so those payments will have to be identified and then recovered.

[Len Webber, Conservative, Calgary Confederation, AB]

I certainly hope you can identify the ones who weren't qualified for the payment. Good luck in your future audits in that regard.

I do have constituents who certainly benefited from the Canada emergency response benefit in the past, and I am now dealing with some who have to pay some of that back through the post audit that they are going through now with the CRA or whoever is dealing with the post audit. They're finding it very difficult to return that money, but if it's required, then....

[The Chair, Conservative, Kelly Block]

Thank you.

[Len Webber, Conservative, Calgary Confederation, AB]

Oh, I'm sorry. That's it? Okay.

Thank you, Ms. Hogan.

[The Chair, Conservative, Kelly Block]

Thank you very much, Mr. Webber.

We will now move to Ms. Yip.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

Thank you, Ms. Hogan, to you and your team for doing these COVID audits so quickly, responding to what the public wants to hear instead of choosing to do other reports.

Was there an explanation given by the Public Health Agency for why the long-standing issues were not addressed for two decades?

[Karen Hogan]

I must admit that I'm not sure that we actually got an answer there. I will highlight that they did some work and that like many federal organizations, they had some capacity issues. As anyone can, you start to prioritize the issue at hand versus doing that preparedness, and to my mind that really underscores the importance of us as a country putting some value on being better prepared. We all too often forget the importance of being prepared, and this example just highlights the need to do better going forward.