Public Accounts Committee on April 15th, 2026

[Karen Hogan]

I don't shy away from telling people what we've been doing, but when it comes to the other agents of Parliament, we chatted and said, “What are you thinking about doing?” I don't know where they all landed, and unfortunately I would feel uncomfortable responding on their behalf.

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

Okay. That's no problem. I understand. Thank you.

You have noted some obstacles that you're facing with respect to some legislation, as you say, in doing your work, and you're looking for some changes to that legislation. Could you expand a little on the particulars of those issues?

[Karen Hogan]

The Auditor General Act is almost 50 years old, and it has been opened very few times. I think one important opening of the act was to add the role of the commissioner of the environment and sustainable development to it.

We have enjoyed very unfettered access to information over the almost 150 years that our organization has existed. When we ran into an issue around certain information, we were given an order in council, but lately we're seeing issues with getting access to information more closely linked to solicitor-client privilege. We have enjoyed access to that for many years and we've always respected the confidentiality and the privilege of that information, but since the Ontario court decision linked to language in the auditor general of Ontario's act, we're seeing some Crown corporations citing that court case and saying that they're going to withhold information from us.

It is very inefficient, as we spend weeks and sometimes months trying to resolve it with them. In the end, we end up with the information that we deem necessary. I've been trying to clarify our access rights for several years so that everyone feels comfortable sharing the information with us and we can all move forward in a much more productive fashion. It takes time from departments, agencies and Crown corporations, and it takes time from folks in my office, including Andrew and myself. We spend a lot of time trying to resolve this.

I think everyone agrees that we should have access to the information we need to do our job, and we're just looking to have that clarified.

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

Are you aware of how the situation you're facing here with access to information compares with other national auditors general?

[Karen Hogan]

I don't know if I could talk about the international situation, but I could definitely talk about it across Canada for sure. I mentioned that the Ontario auditor general's office had this issue linked to their work around Laurentian University. In that court case, the Nova Scotia Auditor General Act was cited as an example, a model, for language that made it quite clear what the auditor general could have access to.

I have provided this information to both the deputy minister of finance and the President of the Treasury Board. The President of the Treasury Board is responsible for the Auditor General Act, but I get all of my funding and everything through the Department of Finance, which is why I've gone to both entities. I've given them an example of the language we think would mirror the Nova Scotia act, but adapted to the federal environment. We're hoping they will take that and move it forward to have the act amended so that we can make this clear for everyone.

[The Chair, Conservative, John Williamson]

Thank you. That is the time.

Mr. Lemire, you have the floor for six minutes.

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

Thank you, Mr. Chair.

Auditor General, I would like to thank you and your team for coming here today for this important exercise. I like the expression and I’m tempted to put on some music to put you on the hot seat, but unfortunately, we don’t have the technical capacity for that.

My first question is probably more important and is as follows: Do you feel you have the resources you need to do your job properly with the money allocated to you?

[Karen Hogan]

I think every officer of Parliament would say that if you gave them more money, they would give you more information. Right now, we are managing financial audits and can provide you with a range of audits so that you can choose what you would like to study, so yes, I am comfortable.

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

Your budget has not increased between the two fiscal years. Does that hamper your work? Are there areas that will not be analyzed? Will there be fewer studies because you have less money to spend?

[Karen Hogan]

No. I would say that right now, like all organizations, we need to be prudent with taxpayer money. Sometimes we have to make difficult choices between two audits, which may be necessary because we have limited resources. All businesses and departments have the same challenge.

At this time, I’m proud of the audits we are choosing and the reports we have tabled in Parliament. You study these reports, which means they are still relevant and useful to you. I will make sure I provide you with relevant information.

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

Your budget has barely gone up since the increase of $7 million between fiscal 2022–23 and 2023–24. Having a measure of stability can be useful, but this stability can also lead to a decrease in staffing, especially when you factor annual salary increases.

Should we at the very least be indexing your budget so you can have the same number of employees? Obviously, failure to increase the budget will inevitably have an impact on payroll and result in a staff reduction.

[Karen Hogan]

We normally follow trends in the public service when it comes to salary increases. We follow the same process as departments and get funding from Treasury Board. If an increase of around 2% is allocated to all public sector employees, our budget will be increased to reflect the salary increase.

However, experience has shown that taking on new mandates alongside ongoing work creates constraints if additional resources are not provided.

I received additional funds in 2021. As I said, the first years, we made significant investments in information technology. When there were delays, we increased our staff. Thereafter, we decreased our staff in order to invest. We’re now getting back to a balanced level.

I appreciate the fact that we can look at this every year, take a step back and think about this issue. I find that this year, our budget is sufficient.

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

We see that over the next three fiscal years, your budget will go down by $4 million. We have just spoken about the human resources aspect. How do you view that reduction? I understand the general war effort, but concretely, where can the Office of the Auditor General cut $4 million, if not on human resources?

[Karen Hogan]

I hope I can explain that clearly, but if not, I’ll ask Mr. Drapeau to chime in.

As I said in a different response, while we may not be able to spend money in a given year, we have a very clear way to do so. We are behind on information technology investments, and so we can carry the money over. It may look like we received less money, but we have asked to carry it over to the following year. It can be months before we receive confirmation on whether the request has been accepted. So far, our requests to carry over spending have been accepted.

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

Given this government’s decisions on environment and sustainable development, the role of the commissioner of the environment and sustainable development within your team will be even more critical.

How can we ensure the commissioner has the flexibility and the resources needed to give Quebeckers a real vision of the future of climate change if the commissioner and their office are also affected by stabilization or a slight decrease in revenues?

[Karen Hogan]

The commissioner doesn’t have a separate office. He’s a deputy auditor general in my office, but he wears a commissioner’s hat.

We operate as a pool of auditors. Each year, we choose the audits that we feel are important for Parliament and we ensure that there are at least six to eight environment and sustainable development topics. We share all our resources, and so if the office is affected by one thing, everyone will feel the impact. If the office receives more money, everyone will also feel the impact of the increase.

Right now, the work carried out by the commissioner is not always studied. Sometimes we reduce the number of reports that the commissioner prepares because we want to make sure Parliament wants to study our reports.

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

The final part of your answer is interesting.

Thank you very much.

[The Chair, Conservative, John Williamson]

Thank you very much.

We will begin our second round now, which will consist of five members with various times.

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

[Ned Kuruc, Conservative, Hamilton East—Stoney Creek, ON]

Thank you.

Thank you to all the witnesses for coming in today. I just want to say thank you to your department for leading by example and actually returning $2.5 million to the government. I think that's tremendous, and I thank you for your respect for taxpayers' money.

I know my colleague from Quebec asked this question, but I'll ask it again. Do you feel that you have sufficient funds to keep doing what you're doing, or is there any need to increase your budget?

[Karen Hogan]

I'm happy to return money, but I feel like my $2.5 million is a tiny bucket in the big sea of the government. We're a small organization and we try to do our part, so thank you for acknowledging that.

I feel that we have enough money to deliver on what we're doing. If we really wanted to give you more—if you said, “Well, we want 40 audits”—we would definitely need more people, but I'm not sure Parliament would have the capacity to study 40 audits. We really want to give you the audits that you intend to study and give you some latitude. If you leave one or two, then we're good.

We have to be mindful if mandates are added. If new Crown corporations or new agencies are created and there's an expectation that we'd look at that, we're at capacity. If there's an expectation for us to do that, then we might need to say that additional funding is needed, but right now we're good.

That's why I appreciate this hearing. It's so that we can take a step back every year to say whether or not we're in a good place. If you look at the tendency, you see that we tend to always leave a couple of million, but that's because our intention is never to exceed our budget. That would not be appropriate. You can only get so close to actually spending every penny you receive.

[Ned Kuruc, Conservative, Hamilton East—Stoney Creek, ON]

Thank you very much for that explanation.

Now I'm going to dig into how you conduct your audits. When you're looking at audits to do, what red flags are you looking for?

[Karen Hogan]

When we have chosen a topic, what would we look for? When we choose a topic, it's because we've spent some time deciding that it was a topic of interest, and we establish an objective that we want to accomplish. Then we set out things for which we're going to hold departments accountable. We call those audit criteria. We agree what those will be. Is it a policy? Is it a law? What are the expectations? We set those up and then we design an audit program to gather evidence to get there.

At times, however, we might come across things we didn't expect to see. It's not as though we're looking for red flags, but we are always skeptical when we receive evidence. We say, “Is this telling me the full picture? Can I get another piece of evidence to corroborate it?” There might be red flags that surface as a result of the answers we receive, or the lack of answers or evidence that we find. Then we follow that along the path.

I've often used the analogy that we have an audit program, and the audit program tells us to walk down this hallway, pass these three doors and then turn left, but if we walk past the first door and we smell something terrible, we're going to open that door and look inside. If it's food that's spoiled, we'll close the door and advise the entity that they should send a cleaning crew in and clean it up, but if we come in there and we see, God forbid, a dead body, we'll say that we need to look at that and investigate it further. We won't turn a blind eye to that, but we do have an audit program that we intend to follow.

[Ned Kuruc, Conservative, Hamilton East—Stoney Creek, ON]

A good example is what you did with the CRA. It was actually your office that helped the CRA. You identified something and went in and helped them find out that there were 39,500—

[Karen Hogan]

We're trying to turn our attention to not just saying that the department couldn't tell us this or they couldn't show us that. If we feel the evidence is there, how can we help answer that question, and then give it over and say keep repeating this?

[Ned Kuruc, Conservative, Hamilton East—Stoney Creek, ON]

Are there any current red flags that you're looking at right now?