Madam Speaker, I am delighted to have the opportunity to participate in this debate on Bill C-263, an act to amend the Financial Administration Act.
The purpose of the bill is to subject five crown corporations to the provisions of Part X of the FAA. Three of these crown corporations, the Canada Council, the Canadian Film Development Corporation and the National Arts Centre Corporation are accountable to Parliament through the Minister of Canadian Heritage.
Crown corporations are vehicles permitting the government to reach goals which are in the public interest when it is necessary to distance the crown from the management of day-to-day operations. Each crown corporation has an enabling act which loosely defines its functions, powers and objectives.
Parliament legislates the general governance of crown corporations and the allocation of public funds to individual crown corporations. Parliament votes the estimates to which operating subsides, loans and advances are made to the crown corporations.
The main estimates of the Canadian heritage portfolio are annually submitted to the Standing Committee on Canadian Heritage for review. In conjunction with this review, heads of crown corporations may be called before the standing committee to make presentations and reply to questions from committee members. The committee examines the financial resources provided to these crowns and their plans on spending these resources.
Part X of the FAA outlines the control and accountability framework for crown corporations subject to this section. The framework entails the following six elements. The preparation of a corporate plan for the approval of the the Treasury Board and the governor in council; the tabling of a corporate plan summary in Parliament; a requirement to disclose in their annual reports the extent to which certain objectives have been achieved; the use of generally accepted accounting principles in the preparation of financial statements; the undertaking of internal audits or the establishment of internal audit committees as well as a requirement to undergo special examinations by the Auditor General of Canada.
These agencies have been exempted from part X because of the need to protect the special nature of their relationship to the government, that is, a degree of independence from political and bureaucratic control.
This means that the government does not interfere with the day to day management decisions of these organizations. The government, nevertheless, is responsible for developing detailed policies on issues of national importance and must be able to keep the paths followed by crown corporations in line with the government's main game plan. This arm's length relationship should not prevent these organizations from being fully accountable to government.
In this vein the exempt crown corporations in the Canadian heritage portfolio follow the control and accountability regime outlined in their enabling legislation and many have chosen to voluntarily adopt a number of the key accountability provisions of part X of the FAA.
Founded in 1957, the Canada Council promotes and encourages the study, appreciation and production of works of art. It also co-ordinates UNESCO's Canadian operations and Canada's participation in that organization's operations abroad.
With the assistance of the Canada Council, Canadian artists and cultural institutions have played an integral role in developing a strong Canadian cultural fabric recognized at home and abroad, have fostered a deeper awareness of our history and have bestowed on us new visions of possible futures.
The Canadian Film Development Corporation, now more commonly known as Telefilm Canada was established in 1967. Its mandate is to foster and promote the orderly growth of an independent film and television industry in all regions of Canada through investment and financing of the development, the production, the marketing and the distribution of Canadian motion pictures and television productions. It also administers Canada's co-production treaties with foreign countries and assists with foreign marketing and the promotion of Canadian productions.
Telefilm Canada is a veritable economic and cultural pillar in the Canadian film and television industries. As a key investor in these industries, Telefilm has forged a strong partnership with Canadian film and television professionals, participating in all aspects of production.
Over the years, Telefilm has gained worldwide acclaim for its expert production, distribution and marketing support of Canadian productions of cultural importance. Canadian companies count on Telefilm for many different kinds of financial support. In fact, the works financed by Telefilm Canada produce an economic spinoff of close to $300 million each year.
The National Arts Centre, which opened in 1969, arranges for and sponsors performing arts activities at the centre in the national capital region, across Canada and abroad, as well as radio and television broadcasts of performances at the centre. The NAC plays an important role in the development of the Canadian performing arts.
As such, the centre strives to develop new works and new talents as well as develop audiences for the arts in Canada by showcasing the finest Canadian and international works and talents and to foster the development and touring of Canadian music, theatre and dance.
As a group, the three exempt crown corporations encourage the creation, production, distribution and consumption of cultural goods and services which are essential to Canada's identity as a country. They comply either with their enabling legislation or voluntarily with several of the key accountability provisions of part X of the FAA including the following measures. All utilize generally accepted accounting principles in the preparation of their financial statements. The auditor general audits these financial statements to ensure that the accounts and statements are a fair representation of the financial position of these organizations.
Each organization's board has established an audit committee which reviews and advises the board on its financial statements, reviews its accounting procedures and internal controls, oversees any internal audits undertaken, reviews and advises the council on reports from the auditor general and reviews any corrective measures implemented as a result of audits.
Each organization prepares an annual report which is tabled in Parliament. This document offers to central agencies, parliamentarians and the general public alike valuable information concerning each organization's activities and the important roles they play.
Each organization prepares planning documents which outline missions, issues, objectives and strategies for a specific planning period. These documents contain information similar to that which would appear in a corporate plan required by part X of the FAA.
The government strongly supports the principle of effective accountability of crown corporations to government. The challenge before us is to ensure that an appropriate balance is struck between accountability of crown corporations to Parliament and the public demand for how these crown corporations spend public moneys, and the essential autonomy of these organizations to operate without interference from government on issues such as artistic merit and taste.
The accountability regimes which the Canada Council, Telefilm and the NAC follow, either in compliance with their enabling legislation or through voluntary compliance with several of the key accountability provisions of part X of the FAA, are strong evidence that the balance between accountability and autonomy can be achieved.
Indeed, in his 1991 report the then Auditor General noted that he was not aware of any accountability problems in the exempt crown corporations that might have been avoided if they were subject to part X.
The proposed bill by the Reform, as tabled, unfortunately would not provide the exempt crown corporations with adequate protection from directive power from the government. The arm's length relationship of these crown corporations and the government is a hallmark of Canada's cultural tradition, one we wish to maintain. Moreover, the bill would bring more employees into the public service at a time of fiscal restraint and downsizing.
Notwithstanding the shortcomings of the bill, in the light of the government's commitment to the accountability of crown corporations, I want to inform the House that the government intends to work with the exempt crown corporations to ensure an appropriate accountability regime.