Ralph Goodale

[Supply, June 4th, 2002]

Mr. Chairman, I have made some broad inquiries about the commission percentages that have been apparent in the sponsorship program. It would appear in general terms that these percentages are broadly consistent with the normal practice in the private sector. Still, I have questions in my mind about the dollar values involved.

There is a real issue that needs to be further pursued as to whether or not the Government of Canada could actually run this kind of program directly without the use of intermediaries. It may well be that the answer to that question is yes. I do not have that hard information yet but it is certainly a point that I intend to pursue because it may well be possible to provide good and valuable sponsorship activity without costly interventions by the private sector.

[Supply, June 4th, 2002]

Mr. Chairman, first let me say retroactively to the previous questioner and in the first instance to this hon. member that we are in a formal way being introduced as minister and critics in our first exchange. I appreciate that and I should have said earlier. I am glad to have the opportunity to work with them in the advancement of the public interest.

On the point that the hon. member has just raised, the cost of using external agencies versus the cost of running a program like this in the more conventional, internal style, is a subject matter that I am carefully examining. I want to look at some statistics and see some alternative models in terms of program administration. My initial impression is that it may well be cheaper and more cost effective to administer a program of this kind in the more conventional fashion rather than contracting out.

I do not have hard information yet that would lead me to a definitive conclusion but I share the sense of the question and it is an issue I intend to pursue.

[Supply, June 4th, 2002]

Mr. Chairman, the issue here is a matter of different timeframes. In terms of the problems that were identified in relation to the sponsorship program those problems related to the time period between 1997 and 2000. We would agree with both the auditor general, our own internal audit section and with the critic for the official opposition that the management practices that were applied in that period between 1997 and 2000 were not up to snuff. They were not acceptable.

The audit revealed to us how corrections could be made. The review of the audit in 2002 indicated that the corrections had in fact been made. On the matter of old verbal contracts it needs to be noted that if criticism was valid at some point in time it was prior to the year 2000 under the old regime. Ever since the year 2000 corrective action has been underway.

[Supply, June 4th, 2002]

Mr. Chairman, I believe that in this regard the action so far has been positive and encouraging.

The problems with these files were identified in the first instance by an internal audit undertaken by the internal audit section of Public Works and Government Services Canada. That was in the year 2000. To ensure that the corrective measures were put in place that internal audit section went back to review the situation in the spring 2000 and confirmed that the corrective action had been implemented in the intervening year and a half.

I would point out again that the auditor general has said the internal audit section of my department is an excellent section and it does very good and courageous work.

[Supply, June 4th, 2002]

Mr. Chairman, we have launched four different examinations of this situation over the last number of weeks and months. We are proceeding with this in a solid and methodical way. We are engaging all of the proper techniques for getting to the bottom of what has been wrong, identifying the problems and ensuring that those problems are fixed. We have action moving on a whole variety of fronts that will serve the public interest.

[Supply, June 4th, 2002]

Mr. Chairman, we are going at this at several layers. If there were in fact something that looked like illegality, there would be the appropriate reference to police authorities but that is not the only arm or measure that we are taking in terms of our review of this.

My departmental officials are looking at each and every one of those files between 1997 and 2000 once again. The auditor general is doing a government wide examination of all sponsorship and advertising initiatives. The President of the Treasury Board is undertaking a review of the management framework and the governance principles that are involved here.

We are coming at this from three different dimensions covering the perspective of an auditor, law enforcement officers and good government administration.

[Supply, June 4th, 2002]

Mr. Chairman, just as a matter of good practice within the public service and also consistent with the terms of legislation, such as the Financial Administration Act, if and when a public official discovers a circumstance that raises questions about legality, there is an obligation on the public servant to draw that matter to the attention of the appropriate officials, including the police if the police happen to be the appropriate officials.

The officials in my department are applying that principle. If there are suspicious circumstances the reference is made to the appropriate police officials. They decide whether or not an investigation is warranted.

[Supply, June 4th, 2002]

Mr. Chairman, in doing the review of the files for this year, the problems that we are identifying are not problems associated with the community based projects themselves. The problems appear to be connected to the delivery mechanism rather than the project.

At this stage it is too early to predict whether any of those community based projects per say would be rejected. I suspect few if any of the community based projects would be rejected.

What we will focus on is the methodology of the delivery, which is where the problem is, not with the project itself.

[Supply, June 4th, 2002]

Mr. Chairman, I just want to give the committee an idea of the magnitude of this task. What we are reviewing is the time period from 1997 to the year 2000. The year 2000 was the year in which the internal audit took place. That was a very important event in the flow of history here.

However in 1997, 1998 and 1999 there were probably about 500 projects processed per year, so the volume of files we have to review is a significant volume. We are going through them as rapidly as possible. In fairness, it is still just a bit early to draw any statistical conclusions. However, in the improvements we are making, we want to be able to measure progress. That is something that is just as important to me as I am sure it is to him.

[Supply, June 4th, 2002]

Mr. Chairman, in the days since May 27 we have not had the opportunity to take the hypothesis of the new rules and apply them to an old situation. It is an interesting question and, if the hon. gentleman would permit, I would like to reflect on the question and see what the impact would be.

It is important for us make improvements and to be able to measure the nature of the improvements. I would very much like to take that suggestion under advisement.