Public Accounts Committee on April 15th, 2026

[The Chair, Conservative, John Williamson]

I call this meeting to order.

Welcome to meeting number 31 of the House of Commons Standing Committee on Public Accounts.

Today's meeting is taking place in a hybrid format, pursuant the Standing Orders. I believe all members are in the room, but using Zoom remotely is, of course, permissible.

Pursuant to Standing Order 81(4), the committee is commencing consideration of the main estimates 2026–2027: vote 1 under “Office of the Auditor General”, referred to the committee on Thursday, February 26, 2026.

I would like to welcome all of our guests today from the Office of the Auditor General. They will be with us for the first hour, approximately. I don't expect we will go over an hour. We have Karen Hogan, the Auditor General of Canada; Andrew Hayes, the deputy auditor general; and Jean-René Drapeau, the assistant auditor general and chief financial officer. It's nice to see you all.

There will be an opening statement. Ms. Hogan, you have approximately five minutes, but there's no hard deadline.

It's over to you.

[Karen Hogan, Auditor General of Canada, Office of the Auditor General]

Thank you.

Good afternoon, Mr. Chair.

We are pleased to be here today to discuss the work of our office, including our most recent departmental results report and departmental plan.

I would like to acknowledge that this hearing is taking place on the traditional, unceded territory of the Algonquin Anishinabe people.

Our office serves Parliament and Canadians by strengthening accountability and trust in public institutions through independent and objective audits. The commissioner of the environment and sustainable development supports this mandate by focusing on environmental and sustainable development matters. We also contribute to improving legislative auditing as well as accounting standards in the public sector, both in Canada and internationally.

I’ll first draw your attention to a few highlights from our 2024–25 departmental results report. Our net operating cost was approximately $132 million, and we employed 752 full-time equivalent employees. We awarded almost 9% of our contracts to indigenous businesses, exceeding our target in this area and reinforcing the government’s commitment to economic reconciliation.

In the same fiscal year, we completed 100 financial audits, 20 performance audits, and three special examinations of Crown corporations. Our work highlighted areas of importance to Parliament and Canadians, and our recommendations underscored the need for improved outcomes for all of Canada’s people. For example, our report on cybercrime identified vulnerabilities in systems that deliver programs and services to Canadians. Some of our other reports focused, for example, on challenges in meeting net-zero emissions targets, and achieving value for money in professional service contracts.

I will now turn to our main estimates and our departmental plan for 2026–27, which sets out our three key priorities for the coming year.

The first priority is to deliver audits of the future. We are expanding our use of innovative technologies to enhance audit quality and efficiency as we examine government operations that are increasingly complex. This includes piloting new tools, improving our audit approaches and developing a new framework to unify our audit practices.

Our second priority is strengthening accountability through transparency. In support of this priority, we are launching a new approach to provide Parliament with updates on the implementation of recommendations by the organizations we audit. This approach involves publishing a new annual report and beginning the development of a public-facing online portal to consolidate information on government responses and actions.

We are also advancing our international peer review planning, as well as exploring ways to communicate in clearer, more user-friendly formats to ensure our work is easily understood and accessible.

Our third priority is to empower a future-ready workforce. We are fostering a skilled, inclusive and adaptable workforce by modernizing our workspaces to create flexible environments where employees can thrive. In parallel, we are taking actions to enhance our employees' competencies and skills in order to maintain the capacity and expertise to fulfill our mandate. This year, we are focusing on strengthening digital literacy and our leadership mindset.

In terms of our spending for the 2026-27 fiscal year, our total budget is approximately $136 million. As an agent of Parliament, our office was not given a budget reduction target as part of the government-wide comprehensive expenditure review. Our office demonstrated its support of the government's objective of restraining operational spending by making a one-time voluntary $2.5 million contribution in 2025-26. We are also committed to optimizing our internal operations and reallocating resources.

In 2026-27, we plan to deliver approximately 100 financial audits, five special examinations of Crown corporations and 25 performance audits on topics chosen based on their significance to Canadians. Some examples are funding to indigenous communities, national defence spending and impacts of climate change.

Another area of focus for the upcoming year will be the need to amend our enabling legislation to clarify the legislative right of my office to access information for the purposes of our audits. This is a concern we have raised repeatedly over the last few years.

Mr. Chair, I would like to acknowledge the committed and hard-working team of professionals in my office, whose work makes all of these audits and initiatives possible. We thank this committee for its continued interest in and use of our work.

We're now ready to answer any questions committee members may have. Thank you.

[The Chair, Conservative, John Williamson]

Thank you, Auditor General.

Members, this is an opportunity for the committee to ask the Auditor General and her team about operations, the money that Parliament allocates to her office or any other questions.

This is an exercise we go through every year. It's an important one. For this committee, it's very focused because we work so closely with the Office of the Auditor General.

On that note, I'll turn it over to Mr. Deltell.

You have the floor for six minutes.

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

Thank you very much, Mr. Chair.

I would like to welcome my colleagues, Ms. Hogan, and Mr. Hayes and Mr. Drapeau. Welcome to your parliamentary committee.

Mr. Chair, before I start, I have a point of clarification. As we know, we invited the Minister of Finance. Do you have any update on that?

[The Chair, Conservative, John Williamson]

Thank you, Mr. Deltell.

I can report that the committee sent an invitation to the Minister of Finance. We’ve not received a response, but our schedule is open to welcoming him before this committee in May or June. Once we get the minister’s response and a date, we will also contact the mayor to have him appear on the same day, but not at the same time.

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

Thank you very much, Mr. Chair. We are therefore calling on the Minister of Finance to let us know when he is available as soon as possible.

Ms. Hogan, the situation we’re facing now is a bit unique. Obviously, it happens every year, but we need to see whether the shoemaker is well shod. It’s your job to verify that audits are properly done. Today, we’re going to see whether the auditor has done a good audit job.

First, who audits you?

[Karen Hogan]

There is no easy response to that question because there are a lot of factors during inspections and audits.

Our financial statements are audited by an independent auditor. Currently, the Privy Council office is responsible for the contract award process. We have an auditor, for a three-year period, who audits our financial statements.

Since we are an accounting firm, we train certified accountants, and inspections are carried out by provincial institutes. Inspections are conducted in each province where we have an office.

We also have an internal audit office within our office, which audits all our services and operations.

As I said in my opening remarks, we are going to start our peer review planning, which is done once with each auditor general’s term. We will start this process this year and it will be completed in 2029, which would leave me one year to make improvements, if applicable.

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

This year, you carried out your operations with a budget of $132 million with 750 full-time equivalents annually. Obviously, Parliament grants you the necessary money for your operations.

At the end of the fiscal year in March, if you have millions of dollars in surplus funds, do you burn it? By that I mean do you rush out to purchase a ton of stuff to burn that money, or do you return the money to the consolidated revenue fund to make absolutely sure there is no unnecessary spending?

[Karen Hogan]

I don’t have a habit of doing that, and I think Mr. Drapeau would agree with me on that. We don’t incur spending in March just because it’s March.

If we have any money left over, like all the other departments, we have the option to keep 5% of our budget and carry it over to the next fiscal year, if we’re allowed to do that. However, if we have large contracts, such as renovating our floors and if money has not been spent, we can make a special request for it to be carried over to the following year. Otherwise, we let it lapse.

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

Did that happen last year?

[Karen Hogan]

It’s very hard for me to answer some questions at this meeting. When we say “this year”, what year are we referring to? I’m asking this question because we’re talking about 2025, but we have just closed 2026 and we’re planning for 2027.

Are you referring to 2026 or 2025?

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

Well, I’d like to know if you “burned money”, and if not, whether you invested or set money aside. What was your last operation?

[Karen Hogan]

We returned $2.5 million to the government because we had surplus funds and we wanted to show our commitment to fiscal restraint. We therefore returned money, but we’ll still have nearly 5% that will be carried over to the following year.

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

We encourage everyone to follow your example. Thank you very much for showing the way. As I said earlier, the shoemaker is well shod. That is why we are here.

Earlier, you spoke about innovative technologies. Did you use artificial intelligence over the last year? If so, what are the results?

[Karen Hogan]

We have invested a lot of money to modernize our information technology systems over the last year. As I mentioned, for several years, such as when I received supplementary money in 2021, the goal was to invest and improve our technologies.

For the past few years, we have used artificial intelligence to improve our productivity. We don’t currently use artificial intelligence in our audits to provide evidence, but we are planning to review the use of artificial intelligence by departments.

These are skills that will have to be developed among our audit staff. We are currently using artificial intelligence within our office to analyze data. We use it a bit for translation purposes, but we’re not yet using it to provide proof or evidence to support our audits.

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

Do I have more time for one last short question, Mr. Chair?

[The Chair, Conservative, John Williamson]

Yes, that’s okay.

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

Thank you.

Ms. Hogan, earlier in your remarks, you said that 20% of contracts have been awarded to first nations businesses.

I am privileged and very proud to have the Wendake nation in my riding. However, the first Wendat are the people most affected by this situation. We know that misappropriation can be perpetrated by shell companies that have an indigenous facade, but are really not indigenous.

What checks does your office carry out to ensure that the 20% of contracts awarded actually go to members of first nations?

[Karen Hogan]

I spoke about 9% of contracts awarded. Most of our contracts are for goods. Often, we purchase computers from recognized companies that are on the list of Public Services and Procurement Canada, and so we know that the money is going to indigenous businesses directly.

We have a contract with a hotel in Nunavut, a province that we visit regularly because I’m also the auditor general for the three territories. That hotel is indigenous-owned.

When we have contracts for services with an indigenous business and the contract is likely to involve a joint venture, we ask Public Services and Procurement Canada to carry out an audit to confirm compliance with contract requirements for 33% of the revenue to flow to indigenous individuals. They confirmed that for this contract, it was around 52%, and so we were comfortable with it. We have a number of contracts for services, and we monitor them much more closely than contracts for goods.

[The Chair, Conservative, John Williamson]

Thank you very much.

Ms. Tesser Derksen, you’re up next.

You have six minutes.

[Kristina Tesser Derksen, Liberal, Milton East—Halton Hills South, ON]

Thank you very much, Mr. Chair.

Welcome back to the committee. It's nice to see you all again.

I want to echo your comments, Auditor General, about your staff and about the professionals who are working in your office. We certainly appreciate their expertise and professionalism, and their patience as well, as they support the work of Parliament. Thank you so much.

I want to talk a little bit about the comprehensive expenditure review. It's something we've been talking about a lot. Departments are being asked to trim up, really, in solidarity with the challenging times that all Canadians are facing and to find efficiencies.

You mentioned, though, in your comments that your department, as an agent of Parliament, is not required to participate in that review, but that in good stewardship of your office and in support of the government's objective of restraining operational spending, you have been taking some steps to do that type of work. Can you tell us a little bit about what you've been doing?

[Karen Hogan]

Agents of Parliament were not given a target for the comprehensive expenditure review, but we were asked to follow the spirit of what was being requested. It wasn't just to cut, but also to adopt technology, to increase productivity and to make sure that we're using public funds in a prudent way. Last year, as I mentioned, we had extra funds that weren't spent. Instead of carrying them over, we wanted to make a one-time contribution to the consolidated revenue fund, which is what we did. Now we are looking at how to leverage technology to increase the amount of work that we can give to Parliament.

When there are cuts and so many changes, that's when you want an accountability body, so we recognize that we need to really see where we're going to look. We're trying to find ways to be more efficient so that we can deliver more performance audit work or smaller, tighter performance audits, so that we can target some of the areas where we're seeing changes across the public service.

We are also following suit in reducing the number of individuals in our organization who are considered executives in the public service. We've already seen a reduction of 24 members of our executive over the last two years. When a member of the management leaves, we're going to continue to look at whether we can restructure how we function, to repurpose their salary in a more meaningful way, or whether we need to replace them. At times, when someone leaves in management, you need to replace them. I need a CFO, so if Jean-René left tomorrow, I would be replacing him, but at times we try to reallocate.

[Kristina Tesser Derksen, Liberal, Milton East—Halton Hills South, ON]

Thank you very much. It reminds me of some work we did when I was in municipal government. We did the same thing. As more senior executives would retire, we'd find a way to rework that position, to spread it among other departments, for example, to maximize those efficiencies.

Are there other departments that are exempt from the targets of the CER?

[Karen Hogan]

I'm not going to be an expert on this, but all the agents of Parliament were not given a target. There were certain departments that were not given the 15%. For example, the Royal Canadian Mounted Police was asked to cut operations by 2% and also to hire 1,000 more police officers. I think there were a few organizations, but all the independent agents of Parliament were given the same requirement to follow the spirit and be more productive to deliver more to Parliament.

[Kristina Tesser Derksen, Liberal, Milton East—Halton Hills South, ON]

Okay.

I won't hold you to an answer here because I realize you don't work as an agent in those other departments, but are you aware of what types of steps they're taking and are you willing to share, as far as is reasonably possible, the example that you've set with regard to other departments?