Public Accounts Committee on June 19th, 2025

[Jerry V. DeMarco]

Exhibit 4.7 in report 4 shows that Canada is improving a bit. The good news is that we aren't heading in the wrong direction. However, the level of improvement is the lowest of the seven G7 countries.

There are 17 sustainable development goals. The four goals that Canada has had the most difficulty improving since 2000 are goal 2, zero hunger; goal 12, responsible consumption and production; goal 13, climate action, which I've often spoken about here or in other committees; and goal 15, biodiversity and life on land. Canada isn't stepping up its progress on these four goals compared to the six other G7 countries. This is one reason why Canada has improved by only 4%.

[Sébastien Lemire, Bloc, Abitibi—Témiscamingue, QC]

Bill C‑5 is currently being passed under a gag order. This bill limits the implementation of a number of pieces of legislation and gives the Privy Council the power to ignore provincial environmental legislation. Some of that legislation is much stricter than federal legislation and biodiversity legislation. I'm thinking in particular of the work done by the Bureau d'audiences publiques sur l'environnement in Quebec.

Are you concerned about the potential impact? Will it set Canada back in terms of indicators?

[Jerry V. DeMarco]

As I said last week, I haven't reviewed the bill. I'll review it when it's passed and becomes law. However, two of our reports are relevant. Report 3 concerns integrated ocean management. It shows that not much progress has been made in determining where to implement new projects in the oceans. Exhibit 3.4 of this report shows that, without studying the areas where energy projects may or may not be permitted and where critical habitats and important carbon storage sites are located, it's harder to make a good decision. People don't have the necessary information.

These two reports and our report on critical minerals last year show that people don't have enough information to make informed decisions. It's concerning. It's time to speed up the implementation of our recommendations to maximize the potential to make good decisions with this information.

[The Chair, Conservative, John Williamson]

Thank you.

Mr. Deltell, you have the floor for five minutes.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

Thank you, Mr. Chair.

Ms. Hogan, when you tabled your report last week, you said something at a press conference that caught my attention. I don't think that I'm the only one in Canada. People in my constituency spoke to me about it last week. You said that your office found issues in almost all the contracts that it reviewed. This showed you that there was no reason to believe that these issues were limited to the two targeted organizations, McKinsey and GCStrategies.

Could you elaborate on this? Does this mean that, given the rule of three, we may see a loss of hundreds of millions of taxpayer dollars?

[Karen Hogan]

As I said, I completed two audits on professional contracts. The one that I released last week focused on the GCStrategies contracts, but another audit focused on McKinsey. If we look at the approximately 50 departments and Crown corporations listed in these two reports, I have no reason to believe that the issue is limited to two suppliers. I think that the public service has forgotten or ignored the procurement rules, which I believe are quite clear. It's vital to get back to basics and to ensure compliance with the rules. However, this doesn't mean that no services or products have been received. There's currently a lack of accountability.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

This boils down to ministerial responsibility, a basic principle of Canadian democracy. We must preserve it.

The ministers are responsible for the money taken from taxpayers' pockets and for its management. I understand that some public servants may or may not be doing their jobs. I understand that some managers look the other way rather than deal with the issues. However, ultimately, the elected officials are responsible because they collect taxes from people in accordance with the laws and obligations.

When I see that four ministers have taken turns leading this key department, and that today, the Prime Minister's chief of staff, meaning Canada's second in command, and other seasoned ministers, including the minister responsible for trade with the United States, still play a major role in this government, I think to myself that we can't overlook this and blame public servants.

Let me remind you that a minister once lost her job over a $16 glass of orange juice. This case involves tens of millions of taxpayer dollars. You're telling me that nothing shows that the same thing hasn't happened in other places. Don't you think that the ministers have a responsibility?

[Karen Hogan]

Our audits covered a period of about a decade, from 2015 to 2025. That's a long time. Public servants report to their deputy ministers, and deputy ministers report to ministers, who in turn report to Parliament and Canadians. There's a common thread that starts with a public servant and ends with a minister.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

We've been seeing this disgraceful lax approach for the past 10 years. The people responsible for it are still in the government and in key positions. Are the taxpayers tuning in today getting their money's worth? No, and that's the problem. You also spoke about the F‑35 program. There were cost overruns and people didn't do their jobs properly. For 10 years, people let things get out of hand.

Ms. Hogan, what does it say to Canadians when cost overruns occur at every turn and when there's no accountability to elected officials who then take money out of taxpayers' pockets?

[Karen Hogan]

I would like to set the record straight. I was just told that our first audit of professional service contracts dates back to 2011, so it covers more than a decade. I like to give accurate answers.

This shows that, over the years, the added rules have probably complicated the procurement process. However, I agree that every public servant, every deputy minister and every minister is indeed accountable to all Canadians.

This process involves verifying that services were received. However, the public service can't demonstrate that services were indeed received in all cases.

[The Chair, Conservative, John Williamson]

Mr. Deltell, you have time to ask a quick question.

[Gérard Deltell, Conservative, Louis-Saint-Laurent—Akiawenhrahk, QC]

I see that I'm at five minutes and six seconds, so I'll stop here.

[The Chair, Conservative, John Williamson]

Thank you.

We're running out of time.

Ms. Yip, you have the floor for five minutes.

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

In your report, Ms. Hogan, we see that there have been a series of amendments to the Indian Act aimed at rectifying inequities. What are the amendments, and how have they increased the number of registration applications?

[Karen Hogan]

I think it was back in 2017 and 2019 that there were amendments made to the Indian Act to remove the historical systemic discrimination that existed. In particular, if women married outside of their community, they would lose their Indian status, and their children would also. There were legislative changes made that rectified that. Individuals then had to apply.

What that caused was an increase in applications. The period we looked at was between 2019 and 2024. In that time frame, there were 140,000 requests for registration that were looked at, which was an increase over previous years, for sure. Those priority cases—if that's what you want to call them, because they were sort of righting past wrongs—were not treated any differently from all the other requests for registration. Some of them are sitting in the backlog. Many of them waited 16 months, on average, to receive a decision.

Really, regardless of what your situation is, that is too long a period of time to be waiting to hear about your status.

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

Why could these registrations not be processed faster?

[Karen Hogan]

We found a few reasons. One was the increase in registrations because of the changes to the act, so obviously there was a resourcing issue. There is an opportunity here for Indigenous Services Canada to find some efficiencies in their processes, which is why we issued several recommendations. We saw that at times, for non-complex applications, a decision could be rendered in one day, so there is the ability to make this more efficient. That's why they need to look at it.

I think what you also have to factor in is that the time we're talking about doesn't include the time that the department might be waiting for a province or territory to provide documentation. An individual is actually waiting longer than 16 months, because at times there is a pause to make sure that official documents are received. That's really too long. That's why I encourage them to compare and look at how quickly passports can be processed and what efficiencies they can find there to bring to this process.

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

You mentioned that there were resource issues.

[Karen Hogan]

We didn't look at their resourcing challenges, but that is what Indigenous Services Canada highlighted, because of the increase. They triage the applications. The non-complex ones are given to regional offices. The more complex ones are kept in the head office to deal with.

We saw a difference. When they were not complex, they were processed in 44 days, on average, but about 20% or so were done in one day. In the more complex ones that involved adoption or lengthy periods of time or ancestry, it was taking about 16 months.

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

Do you feel that they had the technological infrastructure to support these registrations, or were they still bound by a more traditional system of paper filing and whatnot?

[Karen Hogan]

Most of the process was paper-based. I do know that the department is looking to automate, which I think would help with efficiency. That's why our recommendations are around dissecting what's slowing them down.

Finding where they have bottlenecks will help them identify ways to fix things, but an IT system is just a tool to help you be more efficient. You still need to have trained individuals and you have to show that they've done the proper training and that they've made decisions that have been reviewed before they can make decisions on their own. There are lots of elements in our recommendations that will help them improve their process.

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

Did the priority applications include seniors or health problems?

[Karen Hogan]

We did look at what the department triaged as priority cases. It included older individuals and elders in communities, but also individuals who had health concerns. We found that they were still exceeding their service standard of six months. On average, those priority files were taking about 10 months. That's a really long time if you're waiting for funding to be able to be transported out of community for a health procedure. I would hope that they would speed up the process on priority cases because of the nature of some of the priority cases.

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

What improvements can be targeted for those priority cases? That's a long time if you need a medical procedure. It could just get worse.

[Karen Hogan]

It is a very long time. I think part of it is that every file goes through the same process. Even though it's identified as priority, it still follows the exact same steps. That's why they need to figure out a way to streamline what they do and make it more efficient.