Public Accounts Committee on Nov. 4th, 2024

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

I'm simply asking if Boyden received any contracts from SDTC.

[Ziyad Rahme]

Mr. Chair, as I would have said in my opening remarks, yes, Boyden—

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

That's the answer I was looking for.

[Ziyad Rahme]

—was involved, but I declared the conflict.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Thank you.

That's the answer I was looking for.

Were there competitors for those contracts? Was it a bidding process or was it sole-sourced?

[Ziyad Rahme]

Mr. Chair, as I would have recused myself from any involvement because I had declared a conflict with the firm, my understanding—

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

That doesn't change the essence of my question.

[Ziyad Rahme]

—was that it was a competitive procurement process, but I cannot confirm that since I recused myself from any involvement in that process.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

All right.

Since you recused yourself, you therefore had no say in the fact that Boyden was involved in the appointment process or the introduction of the members.

However, the conflict of interest doesn't disappear when you leave the room. Conflict of interest is a significant issue. This is your wife working as a partner at a firm that will appoint board members; those members will then set your own compensation. You can't confirm it right now, which is unfortunate, but it seems that Boyden received sole-source contracts. From what I understand, there wasn't even a competitive framework. You're telling me that the process was competitive, but that you don't know.

Do you know or not? Was it competitive, Mr. Rahme?

[Ziyad Rahme]

Mr. Chair, as I just previously answered, given that I had recused myself from this process completely, I don't know what the process was. I wasn't involved in it, and that would be a question that would be better posed to those who would have led that particular recruitment.

[The Chair, Conservative, John Williamson]

Thank you very much. Up next is Mr. Masse.

Mr. Masse, you have the floor for six minutes, please.

[Brian Masse, NDP, Windsor West, ON]

Thank you, Mr. Chair.

To our witnesses here, in 2012, the budgetary allotment of the Auditor General's office was cut by more than 5% by the Stephen Harper government. Later on, Pierre Poilievre criticized the Auditor General's office for not doing the number of audits that it did in the past. Notably, in one of his media scrums, he mentioned that it does 14 of 28 per year—at that time in 2020.

Is there any connection between your capability in this file and doing audits? I'm just curious as to what capacity or amount your office is spending on this and what are the repercussions of that across the board. There have been other auditors general who have asked for significant increases in their budgetary allotments. The criticism that was levied against you by Pierre Poilievre was related to the fact that your budget doubled whereas the number of audits was reduced by half. I'm wondering whether or not there's any connection whatsoever with your capabilities in your office, or whether or not this effort here is going to compromise your capability in other audits in terms of staffing and commitment time.

[Karen Hogan]

I can tell you that my predecessor, Mike Ferguson, was definitely looking for additional funding and only received a fraction of what he had requested. After my nomination in June 2020, I resubmitted budget requests and I did receive the $25 million in additional funding.

The goal was to invest in our IT systems—because we had for many years prioritized audits over that—and also to return to levels of performance audits that Parliament would expect from us. Our goal is to try to hit at least 25. While we're always skirting a little close to that, I would argue that some were very large, such as all of the work that we did on Bill C-2 or the COVID payments, and we also do work in the territories.

When it comes to this audit, we definitely did a very thorough audit, in my opinion, and we completed it very quickly. We mobilized an incredibly strong team so that we could respond quickly and provide information to Parliament in a very timely way, so our budget did not impact this audit.

Andrew, I can see that you want to add something.

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

I have two quick things. We got the additional funding largely because of the support of the public accounts committee. It was a major recommendation of this committee in the previous Parliament that was incredibly helpful for us.

One of the challenges we face in meeting the number of audits we want to do is changing course during audits, either dropping them, because we need to start a new one to meet the needs of Parliament, or for other reasons that cause us to take big turns.

[Brian Masse, NDP, Windsor West, ON]

In 2012, there was a 5% across the board cut. Was that ever made up for? That has compounded every year across the board. You might have received some IT support for those measures, but I am just wondering whether that 5% is a continual cut across your operations. What's the compounded effect of that? IT is different from the capability of doing audits. With IT, you have to keep up with that infrastructure; it's bricks and mortar, especially when you're in the auditing business. That's different from manpower, research, and other services.

[Andrew Hayes]

We felt the impact of the compounding over time through the period of 2012-21. When we received the additional funding in late 2020 and early 2021, that brought us back to the level we needed to be. We are satisfied right now with our funding.

When talking about our funding, we still need to resolve the more fundamental issue. We shouldn't be going to the departments we audit to ask for additional funding. There should be an independent funding mechanism.

[Brian Masse, NDP, Windsor West, ON]

With that, from 2012-24, has the type of auditing changed in terms of your practices? You might be okay right now in reflecting back on what was taken away in 2012. It was finally restored, but all of that work in-between is gone. There's certainly a different environment in how you do your work from nearly a decade ago.

[Karen Hogan]

Absolutely, some of the funding we received was used to stabilize some of our IT infrastructure. It was very old and outdated. Over the last couple of years we have been switching and trying to use artificial intelligence and more automated audit techniques.

We continue to use statistical sampling as a very sound method to approach audits. As Andrew said, though, when we pivot, sometimes in the middle, it has an impact. That has nothing to do with IT, or how we change our audit approach, but everything to do with responding to the emerging needs of Parliament.

[Brian Masse, NDP, Windsor West, ON]

The reason I ask these questions is that whistle-blowers came to your office in 2022 and.... What kind of went through at that time and process.... It was suggested they go elsewhere at that time.

I want to drill down here on the process. The workers had a tough time with that. What happened in that instance? Is there any regret, remorse, or are there any second thoughts? Was it just the process? Please explain the process that moved those whistle-blowers to another location.

One of the things I've been active on here at the House of Commons is whistle-blower legislation, as well as Crown copyright and release of information to make it less burdensome on employees. Maybe you can explain that a little bit, because that's important.

[Karen Hogan]

Absolutely. I will ask Andrew to jump in here, because he sort of handled that personally, when the whistle-blowers came to us.

Andrew, you can talk about the process we took.

[Andrew Hayes]

Yes, indeed. When the whistle-blowers were engaging with our audit team, we were monitoring what was happening. We were engaging with the department, ISED. From our perspective, at that point in time, there needed to be some management action. An audit can only take you so far. Given the fact that some of the allegations related to Governor in Council appointees, we also engaged with the Privy Council Office, because it was responsible for those appointees.

However, we were monitoring all the way through what was happening. That is why, in October 2023, we decided to launch this audit. This wasn't an audit that was requested; it was an audit we decided to do.

While we are always concerned about the experiences of whistle-blowers—in particular, as you mentioned, the human resources sides of that—with a foundation that's more than arm's length away from the government, we are constrained in our ability to look at an audit in the same way we would in a department. Put simply, we wouldn't be able to go in and look at HR practices. We were limited to the four corners of the funding agreement.

[The Chair, Conservative, John Williamson]

Thank you. I'm afraid that is the time. We will come back to you.

[Brian Masse, NDP, Windsor West, ON]

Of course. Thank you, Mr. Chair.

[The Chair, Conservative, John Williamson]

I allowed some additional time there for Mr. Hayes' answer.

We're beginning our second round, and we'll have a recess after this in about 25 to 28 minutes.

Mr. Brock, you have the floor for five minutes, please.

[Larry Brock, Conservative, Brantford—Brant, ON]

Thank you, Chair.

Welcome back, Auditor General and team. It's always a pleasure to have you at committee.

Thank you, Mr. Rahme, for your attendance today. My questions in this particular round will be largely directed to you, Mr. Rahme.

Is this the first time you've appeared at committee to discuss the SDTC?