Public Accounts Committee on Nov. 1st, 2022

[Andrew Hayes]

We are only able to speak about the negotiations that we do with our employees. My colleague from the Treasury Board Secretariat might be able to talk about the broader impact on the public service, but we do know that the collective agreements that are settled at other tables do influence the negotiations that we have at our table.

[Han Dong, Liberal, Don Valley North, ON]

Let me be more specific on this question. You mentioned that 99% already have their deal. If your office received a large boost in salary, what kind of impact does that have on the next round of collective bargaining, and would that undermine the government's credibility in negotiating in good faith?

What are your thoughts on this?

[Andrew Hayes]

For our office, the important element that we are still dealing with, and will be dealing with for a little while, is the comparative salaries of people doing similar functions in the public service. If we were to pay a particular group of employees who were performing a particular function more, I think it would have an impact on the rest of the public service, and likewise the other way: If the public service pays more, then it's going to affect us even though we have a different classification level.

Again, my colleague from the Treasury Board Secretariat might be in a good position to speak to that.

[The Chair, Conservative, John Williamson]

I'm afraid that's your time, Mr. Dong. Thank you very much.

Ms. Sinclair‑Desgagné, you have the floor for two and a half minutes.

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

Thank you, Mr. Chair.

In its report on public accounts, which our esteemed chair tabled in the House a few weeks ago, the committee adopted the recommendation that consideration be given to the possibility of Crown corporations releasing their financial statements and disclosing their expenditures like departments do.

Also, last week, the Commissioner of the Environment and Sustainable Development expressed support for Crown corporations disclosing their GHG emissions like departments do under the green government strategy. A number of issues are raising questions about Crown corporations being unwilling to accept accountability. We're looking to discuss how to improve Crown corporations' transparency and what accounting reforms are necessary. The thought process has begun.

Let's go back to the OECD report on transparency and accountability. I believe Mr. Hayes gave the example of the United Kingdom. In the U.K., the departments responsible for Crown corporations do indeed disclose their revenue, expenditures and assets, along with Crown Corporation expenditures. They provide exactly the same amount of detail as the departments.

I have other examples of good practices. In Korea, the Ministry of Economy and Finance is responsible for monitoring information released by state-owned enterprises, and the ministry can issue penalties for SOEs that omit information. Here, a new unit could be established in the Department of Finance.

In the Netherlands, SOEs are listed in order of transparency, and in Finland, a report on all SOEs is released annually. It includes the SOEs' investment portfolio, net worth, financial statements, and executive salaries. Basically, many countries do that.

[The Chair, Conservative, John Williamson]

You have 30 seconds left.

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

There's no reason Canada shouldn't follow suit, especially when you consider that in 2020, Export Development Canada sent $8.1 billion to oil and gas undertakings out West, which greatly undermined the climate change goals of an entire country.

[The Chair, Conservative, John Williamson]

Thank you very much.

Please forgive me. I didn't mean to interrupt, but I wanted to be sure that you were aware.

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

That's fine. I'm watching my time.

[The Chair, Conservative, John Williamson]

Thank you very much.

Mr. Desjarlais, you have the floor for two and a half minutes.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Thank you very much, Mr. Chair. My questions for this round will be directed to Mr. Diotte, executive director, employment relations and total compensation, strategic compensation management, office of the chief human resources officer. That's quite the title, Mr. Diotte.

We have just heard some scathing testimony from the Auditor General about the fencing or corralling—I'd say interference—between her office and the actual bargaining process. She mentioned that she approached the Treasury Board several times for particular aspects of that agreement. Each time it seems that it resulted in the most absolutely catastrophic result, which was a strike, which affected the work of this public accounts committee and the work of Canadians to understand the transparency work that's required from the Auditor General's office. That quality must be controlled.

When I think about that, of course I also think about the conversations I had with the President of the Treasury Board at that time. She actually blamed the Auditor General and said that her hands were tied when it came to that strike, that the Auditor General had no way to control in any way, shape or form the results of that strike, and that the negotiations at the Auditor General's level resulted in it.

Like a canary in a coal mine, Mr. Diotte, workers who are following in the footsteps of what had happened at the Auditor General's office are scared to go into the mine, if you understand the reference. I'll be frank. What was the role of the President of the Treasury Board, Mona Fortier, in the bargaining by the Office of the Auditor General during the recent labour dispute that resulted in a strike?

[Stephen Diotte, Executive Director, Employment Relations and Total Compensation, Strategic Compensation Management, Office of the Chief Human Resources Officer, Treasury Board Secretariat]

Mr. Desjarlais, we must have listened to different testimony. I didn't hear “scathing”. With respect to—

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

I heard “scathing”, and she also said “fence”. Describe the fence. What was the role? Who put that fence there?

[Stephen Diotte]

Our challenge is that regardless of how we think of separate agencies as being independent, arbitrators and third parties, like public interest commissions, see us as one employer. Essentially, the “fence” is the pattern that was set for 99% of the public service. The jobs at the Office of the Auditor General are very similar to jobs in the core public administration. The financial pressure that could have been created by breaking that pattern could indeed have been catastrophic from a financial perspective.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

My second question, although I disagree—

[The Chair, Conservative, John Williamson]

You're going to have to wait, because you're down to four seconds. I can assure you we'll get back to you.

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

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you, Chair.

I hear lots from my constituents asking me basic questions like this: Where does all the money go that we send to Ottawa?

Madam Auditor General, you're critical to helping people get to the bottom of these questions and be able to know the answers to them. We're very invested in ensuring that your office is able to continue to do its job effectively, independently, and with the perception of independence.

We're living through a time.... Whereas other members have mentioned there's declining trust in the current government, there remains a great deal of trust in your office in terms of its ability to raise these questions and to identify whether money is being spent appropriately and whether performance objectives are being achieved.

We've also seen, in the last few years in particular, incredible growth in the size of government. The federal government is trying to do more and more things. They're spending more and more money. The deficits we've seen in recent years have been exorbitant. It would seem to me reasonable to say that the size of the Auditor General's office should be proportionate to the size of government; that is, if government is trying to do more things than it did in the past, the Auditor General should have the capacity to audit more, because there's just more activity going on in government.

Would you say that with that philosophy, the size of your office should increase in proportion to the size of government in terms of your ability to do audits? Is that the philosophy that has guided funding for your office, or is there an expectation that you would maintain the same size and the same capacity to do audits despite the growth in government that we've seen in recent years?

[Karen Hogan]

I think one funding model could be one that is linked to government spending, but then the reverse is also true. As there's a reduction in spending, then you would drive down the size of the office, which think would not necessarily be in line with the intended goal of ensuring good accountability.

I do think that you're absolutely right that government spending needs to be considered. As there is more spending, there is more work. We do do the financial audit work, and for the financial audit work, if the pool is larger, then it takes a little longer to get that work done.

I would just caution linking it, because then you have ups and downs that are really unpredictable, and then that doesn't ensure a consistent delivery of reports to help support Parliament.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

I guess one way to respond to that is that there should be some evenness—

[The Chair, Conservative, John Williamson]

Wait one second, Mr. Genuis. I've stopped the clock here.

Mr. McCauley and Ms. Yip, could you take the conversation to the side room? I don't mind conversations happening, but you need to pull away. It is distracting to the witnesses and even to the members, I think.

It's back to you, Mr. Genuis.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

This is going to be a compelling line of questioning, colleagues, so—

[The Chair, Conservative, John Williamson]

I would expect nothing less. You have two minutes and 15 seconds.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

Thank you, Mr. Chair.

I guess one way to respond to that is to say that of course there should be a certain evenness. It shouldn't be jumping around erratically. However, in a general sense, if government is doubling in size over time, there should be some proportionate growth in capacity in order to look at the full range of all these new government activities. We've seen this with COVID spending.

Is it fair to say that as parliamentarians, we're desperate to see more auditing happen in various areas? Is there a proliferation of scandals and questions around different areas of spending, and your funding has not kept up with those demands and needs?

[Karen Hogan]

I think Andrew will probably add to this, but I was in the office back in 2017 when Mr. Ferguson asked for additional funding. At that time, I believe government spending had gone up 30% or so—is that correct?—and our funding had remained stable.

Absolutely, that means there's more spending for us to audit on the financial side as well as new programs for us to audit in order to help ensure accountability. I believe your analogy is correct. As government spending goes up, there is a need for us to have more capacity to do more work or there will be work we have to not do in order to cover new programs.

[Garnett Genuis, Conservative, Sherwood Park—Fort Saskatchewan, AB]

To put a fine point on this, who determines how much money you get, and should we have a process whereby your budgets are set more independently?