[Recorded by Electronic Apparatus]
Tuesday, December 10, 1996
.0918 
[English]
The Chair: I now call to order this meeting of the Subcommittee on the Business of Supply of the Committee on Procedure and House Affairs.
As Mr. Laurin pointed out, we have very little left to do here in terms of getting through these recommendations.
We can start. We left off on page 8 at item number 4, ``Net or Gross Amounts''.
Mr. Brian O'Neal (Committee Researcher): Madam Chair, if you'd like, I can give a bit of background information about this particular recommendation.
The Chair: Sure.
Mr. O'Neal: Basically the issue is that several government departments receive revenues, that is, they either charge user fees or receive payment from other departments that make use of their services.
In the estimates these revenues are listed in the part IIs, I believe, for information, but then they're netted out of the vote Parliament makes when the estimates are presented. That is, when you vote an appropriation or consider an estimate, what you really look at is the amount of money a department plans to expend minus what it's received in terms of revenue.
.0920
Some people find this process is inappropriate. It was mentioned by one witness, Dr. Franks, and I'll quote from his testimony: ``Most of the time, the amount voted by Parliament should be a gross amount, not a net amount''. So this recommendation follows along the suggestion made by Dr. Franks that Parliament vote gross amounts.
There would have to be a change here. It says ``beginning with fiscal year 1997-98''. That's the one coming up. Obviously that would be too soon, so if the subcommittee accepts this recommendation, we will have to change it to 1998-99.
The Chair: Let me make a comment, because I've been thinking about this.
Something that was raised with us by a number of witnesses was the idea that Parliament has two functions: one, to tell the government how much money it can raise and how; and two, how it can spend it. They said Parliament doesn't pay nearly enough attention to the revenue side.
I agree with the main purpose of this recommendation as Brian has it here: that Parliament should be approving in total what the department is spending on a particular program, not its net amount. On the other hand, Parliament also needs to pay attention to how much revenue the department is raising and how.
I wonder if we couldn't rework this recommendation to get in both. In other words, Parliament would vote both gross and net amounts, so it would be paying attention both to the total spending of the department and to the amount of revenue it is raising itself to cover some of those expenses.
Mr. Loney (Edmonton North): So basically you're setting parameters.
The Chair: Yes. That would ultimately lead members of Parliament to look more closely at just how much revenue their departments are raising and if that is appropriate.
[Translation]
Mr. Laurin.
Mr. Laurin (Joliette): I fully agree with this wording, but I wonder how it would be possible to do such a thing seeing that no one knows ahead of time how much the department will receive in revenues for the use of its services. I do not think that any department knows at the start of the year how much it will receive from other departments or from a service for which it collects user fees.
For example, at the start of the year, a department receives a request to print a brochure that would cost $100,000. How can the department know ahead of time that during the year, it will have to print a brochure? That can happen after the Estimates have been adopted. I wonder what we can do to make this workable. I do not know if it represents significant amounts of money for the departments.
The Chair: They cannot know exactly. They can only estimate it.
Mr. Laurin: Yes, but that is based on past experience.
The Chair: At any rate, it is done.
[English]
Mr. O'Neal: The member is making an excellent point.
I have an example from part II of the estimates. There's a table that lists budgetary main estimates by standard object of expenditure. There is a column in this table entitled ``Less Revenues Credited to the Vote''.
For Agriculture, for example - and I'm sorry I don't have the year - they have revenues here of $17,550. They've subtracted that from their total expenditure at the end of the year. So they do have a means of at least estimating how much they'll bring in through things such as user fees or charges to other departments.
.0925
I imagine that if these aren't accurate, they'll revise them when it comes to the supplementary estimates in the fall. Nevertheless they do make an estimate of this already, and as mentioned, they subtract it from the amount Parliament actually votes on.
[Translation]
Mr. Laurin: Does that mean that a department that had predicted revenues that did not materialize would be deprived of an appropriation that it had hoped to obtain?
[English]
Mr. O'Neal: I imagine that's why they would have to come back to Parliament in their supplementary estimate to make up the shortfall. I don't know if that's ever happened. Again, that's something I could check.
The Chair: They would have two choices. They could either cut their expenses in another area or come back to Parliament for extra.
Mr. Loney: Using that $17,000 as an example, I assume this is a means of reconciliation at the end of the budget year.
Mr. O'Neal: Let me choose a different kind of example. They're saying ``We forecasted that our expenditures for the upcoming fiscal year are going to be $300,000, but we also anticipate bringing in $100,000 of revenue from various sources. Therefore we're only asking you to approve an appropriation for us of $200,000.''
The problem there is Parliament doesn't end up approving global expenditures the department will make, just that part of the expenditure that has to be directly funded out of the consolidated revenue fund.
Mr. Loney: So what happens in a reconciliation if the revenue is up and the transfer is down? The figures are skewed then.
Mr. O'Neal: Well, I would keep in mind that no department is ever obliged to spend up to the very limit of what they've asked for. They can spend less than that.
A portion - I believe it's 5% - goes into a revolving fund that they get to keep for the next year. So if they bring in more revenue than they've forecasted, I'm sure that would form part of their surplus, most of which would be returned to the consolidated revenue fund and a portion of which they would be allowed to keep for use in the subsequent fiscal year.
[Translation]
Mr. Laurin: Does that mean, for example, that a department which was authorized by Parliament to spend 10 million dollars would only receive votes for 9 million dollars if, during the year, it received revenues of 1 million dollars? Is that what that means?
That means that regardless of its source of revenue, the department could not spend more than 10 million dollars. If, during the year, it has no external revenue, it will receive a 10 million dollar appropriation. However, if it has revenues, the appropriations will be reduced in proportion to the amount of money it received externally. Is that what that means?
[English]
Mr. O'Neal: I don't think so. Again, that's something I'd ask permission to look into a little bit more carefully.
In some respects this could be seen as a matter of principle or philosophy - exactly how Parliament should vote expenditures. Do you approve a whole global expenditure or do you just approve the part that is funded out of the consolidated revenue fund and therefore largely through taxpayers' dollars?
As subcommittee members may know, following the last meeting I had a chat withMr. Williams, by the way, to get his view on these issues. I want to pass on to you that from his perspective, the most important thing is that Parliament votes the expenditures that are funded through tax dollars. Therefore the matter of voting a net amount doesn't really trouble him very much.
This is here because Dr. Franks brought it up as a matter of importance.
.0930
The Chair: Mr. Pagtakhan.
Mr. Pagtakhan (Winnipeg North): The total expenditures will reflect the total activities of a given department. I can see that the total revenues will include, as you said, general revenue, from the taxpayers directly, not dedicated to anything, and then there are all the others - user fees, in this instance, and whatever dedicated tax we may get or surtax or what have you.
I think we can play a useful role in defining whether we ought to allow that kind of dedicated tax - user fees by each department, or tobacco tax, the excise tax, for example. If we are shying away from that kind of dedicated taxes, then let all of them be revenues and reporting them will be simple. All of them will go to general revenues by whatever mechanism or prediction of when they will collect that.
If it is the philosophy that we have now established the so-called departmental user fees, they must be very clearly identified. We must be very careful. User fees will be predicated on the volume of activities that a given department does.
If the user fees decrease, automatically the activities will have decreased, so the allocation from the general revenue to the general activities should be less as well, because you're not doing the work. I'm thinking of immigration, for example.
The question is which is the simpler way of going about this kind of budgeting in terms of the public understanding that? Do we have to call them user fees? Do we have to call them general taxes or what have you? In a sense I'm posing a question.
The Chair: That's why I put forward the suggestion that this recommendation should be amended so that Parliament's votable on both gross and net amounts. At the same time it's telling the department overall what it may spend and on what, it's also saying you're expected to offset those expenditures with this much revenue. It knows both the total spending of the department, how much it's getting from the general taxpayer, and how much it's raising in revenue. I think you need that for full accountability. Otherwise the department could come in with a $15 million budget - $10 million from general revenue and $5 million from other revenues. It could choose to spend more than Parliament approved by simply doubling its revenues.
Mr. Pagtakhan: And it ought not be allowed.
The Chair: My view is that Parliament should be aware of both the total expenditures and the revenues generated.
Mr. Pagtakhan: That's right. If the activities in terms of publications, for example, happen to be so much and you have so much revenue... So what you're suggesting is that the proportion of expenditure, in this instance, from non-consolidated funds remains at all times. If it is say 40%... Or should they spend it first? What is the -
The Chair: I don't think it's that simple. Right now Parliament says here is your $10 million. It doesn't say you have a $15 million budget, it says here is your $10 million. It says nothing about the $5 million in revenue the department expects to raise.
Mr. Pagtakhan: Oh, I see.
The Chair: What I see is that when Parliament deals with the vote, it deals with both the gross amount and the net amount. Then Parliament's better informed, and so is the public.
Mr. Pagtakhan: And with the differentiation between general revenues and departmental user fee revenues...
The Chair: Yes.
Mr. Pagtakhan: That would be really clear in terms of accountability. That is what we would like to indicate.
The Chair: I think that's what we're trying to achieve throughout this.
.0935
[Translation]
Mr. Laurin: Whether you proceed one way or another, there is a disadvantage. If you see that revenues coming from other activities reduce departmental expenditures, there could be abuse in that the department could say that it can spend because it has not asked for anything from Treasury Board, because it generated its own revenues. So it is not necessarily beneficial to the taxpayer.
Moreover, if the government says that the revenues it receives from other sources will be deducted from the amount provided by Treasury Board, there will no longer be any incentive for the department to generate its own revenues. A department could say that there is no point in carrying out activities that would generate revenues because it is already assured of receiving money from Treasury Board.
I wonder if the ideal formula would not be to allow the various departments to obtain revenues from other activities and to use only a percentage of these revenues, let's say 50 per cent.
For example, we could say that a department that receives revenues from other activities could use 50 per cent of these revenues for its expenditure and that the other 50 per cent would go to Treasury Board. That would reduce the amount of granting contributions from Treasury Board and it would force the department to manage its operations more effectively, because it could provide more services if it could use part of the revenues it generated itself. I wonder if that would not be a more advantageous formula for both Treasury Board and the departments.
[English]
The Chair: Mr. Pagtakhan.
Mr. Pagtakhan: I like the idea, and the reason is this. This is done in almost all universities. For example, I had a threshold salary paid by the university that was obtained from all sources, including government. Then I had fee for service from direct patient consultation. Because my obligation is also to teach, the university has an obligation to ensure that I cannot see so many patients that I forget my teaching obligations.
At the same time, they would like you to not be lazy. See your patients, because the community will complain if they cannot see the consultant. But for every dollar you raise after your threshold, the total ceiling you will receive, or in this instance expenditure, the university gets 50%. So for every dollar you raise, you will only retain 50¢. So there is still an incentive to see patients, but the university obligation is maintained. They can use the 50¢ for research, for the development of the curriculum, etc. The principle is the same. I like that idea. The motivation is there, but not to the point that you will not give back to the general revenue.
The Chair: The motivation is there now, because departments get to use and spend everything they raise through fees. I'd be a little concerned. This would be a dramatic departure from what has been done in the past. To the best of my recollection, we didn't have any kind of input from any of our witnesses on... I would be a little reluctant to do that without feedback on what the effects would be, because generally the tendency has been more to let each ministry be responsible for its own operations. The tendency has been to generate revenue on a cost-recovery basis where it can and where appropriate, knowing that the department can put that money back into its operations. There is a control on it now, which is the general statute that you can't charge more for a service than it costs you to deliver the service.
[Translation]
Mr. Laurin: Madam Chair, I hope that you do not think that good ideas can come only from witnesses. Even if it is a departure from what has been done in the past, I do not think we should be afraid of going off the beaten path to improve government administration. That is a suggestion.
.0940
As for the percentages, the government is applying them. If the government thought it would be better to have an 80/20 per cent breakdown instead of a 50 per cent breakdown, I would not object, but it seems to me that it would be an incentive for people in the department to manage operations more effectively.
The Chair: They are presently authorized to keep their revenues.
Mr. Laurin: Yes, that is what one of our witnesses criticized. Our witnesses said in fact that when a department asks for 10 million dollars, for example, it prepares plans or programs for that amount. If it is lucky enough to obtain 2 million dollars in additional revenues from somewhere else, the department can spend the 2 million dollars. Why spend it if it is not necessary and if there was no such plan in place? The 2 million dollars should be returned to Treasury Board.
There is nothing to that effect at present. It encourages departments to spend more. They say: "I have an extra 2 million dollars and I am going to find a way to spend it." That does not encourage them to be better managers, but to spend more. If they have 10 million dollars, they spend 10 and if they have 12 million dollars, they spend 12.
Sharing extrabudgetary revenues could encourage a department to generate other revenues to provide more services, but at the same time, its main interest would not be limited to generating additional revenues, because it would have to share them with Treasury Board. So that would cost Treasury Board less and would allow the department to do more. I do not want to debate this for an hour, but it seems to me that this is an interesting idea that could be examined and recommended to the department.
[English]
Mr. O'Neal: Madam Chair, I will make one comment and one suggestion. The comment is that the whole business of the estimates and voting supply is based on the principle that the government may not make payments out of the consolidated revenue fund without Parliament's authorization. Essentially, the focus is there - the payments out of the consolidated revenue fund, not necessarily giving permission for a department expend a global amount of money.
My suggestion to you and to subcommittee members is that I study your concerns carefully, and that over the Christmas break I sit down with people who are more versed in these issues than I am, particularly people at the Auditor General's office, whom I speak to from time to time, get some feedback from them about your concerns, and then come up with a number of suggestions to put to you when you return in February. Barring that, I can make sure those suggestions go out to you toward the middle of January so that you'll have them when you return.
The Chair: C'est correct? Okay.
Mr. Pagtakhan: Brian, did I hear you correctly that the idea...? The concern raised by the chair is a valid one. Even for the non-consolidated revenue, the revenues obtained by user fees are imposed by law or regulation. It's a defined amount that has gone through Parliament, so you may not change that.
A department may not impose a fee of any kind without that regulation going through the legal process, either in the Canada Gazette or what have you, and that is determined of the government at the beginning of any given policy program period. So that is the limit of what it can do.
At the same time, where I can see your point is through the process of budgeting they must have approximations - because our expenditures and administrative costs for this kind of user fee generation will be this, therefore our net will be this, and that is what they will project as net revenue from the non-consolidated fund.
.0945
With the motivation we will have and the increased efficiency we will have, the fixed amount for a given activity will remain as per regulation. That is the principle we should continue; otherwise departments can be lawmakers. They should remain. But where I think we have to insist is that this kind of efficiency development in management will be there.
So how can we reconcile that very excellent principle that with good management you will get more net revenue for any given activity and beyond this then you have to have the motivation that you can spend? But you're going to spend everything, right? If you can get that over the Christmas break, I agree with that, yes.
The Chair: Okay, we agree to that. Let me just be sure we understand each other. There's a general agreement that we want to know the total of what the department is spending as well as what they're raising and therefore the net amount they require from the consolidated revenue fund. We also want to look at what the effect would be of requiring departments to share their revenue with the general government coffers. Right? Okay. We have a little problem for you to look after.
I'm going to take over on capital and operating budgets, since Brian has admitted quite frankly he doesn't know what I'm talking about, which means I haven't explained myself clearly.
I asked to have this in the report as an item because I've been extremely frustrated in trying to deal with estimates, particularly on major capital projects. You may have a major capital project that goes on for ten years. Parliament never sees the totality of that capital project; it sees what it votes to it every year. It seems to me that because the estimates deal with a three-year time horizon and those projects can go on much longer than this, it would be helpful to Parliament to have a longer view, both backwards and forwards, of any major capital projects the department's involved with.
Let me take a simple example. No, this is not a simple example, but let's take the frigate program as an example. That's gone on for well over ten years. It seems to me as long as that's an active project of government, Parliament should be kept up to date on a yearly basis on what the costs have been and what they are projected to be before completion of the project. If I come into Parliament in 1988, as I did in the middle of that project, I don't want to know just what's being allocated that year, I want to know when the project started, how much was spent on the planning, development and feasibility, how much has been spent year by year on that project, and how much is planned to be spent year by year until it's completed. That's the only way Parliament knows if what it's being asked for this year is consistent with last year's plan or is twice as much. It's the only way Parliament knows if a project is getting into major significant cost overruns.
Mr. Loney: Can we use as another example Public Works and the renovations here on the Hill?
The Chair: It's a very good example.
Mr. Loney: They may be open-ended and go on for a number of years, because no doubt they're going to find there are things that need to be restructured, which perhaps they were not aware of when they started the program.
The Chair: Yes, that's an excellent example. You want to know, when the minister first announced we were doing this project, how much money was spent in the planning phase, on architect fees in year one, year two and so on.
Mr. Loney: This program is definitely going to overlap two governments - two Parliaments, rather.
The Chair: Yes, more likely three from the way I see it projected.
Mr. Loney: Yes, but two of them we are aware of right now, as we're discussing this.
.0950
Mr. Pagtakhan: What it will also tell us is if there is a consistently good record of performance on those budgets in terms of product produced. Therefore we would be able to measure efficiency or absence of efficiency. We will also be able to know year to year why there has been an overrun of costs. Was it due to poor prediction of cost, or was it due to really unavoidable inflation, or was the so-called good efficiency not really efficiency, but only a consequence of deflation?
The Chair: Or does it make sense to spend twice as much this year because on the overall project I'll save far more than this if I do that work together this year -
Mr. Pagtakhan: I like that, certainly to provide for greater appreciation of the evolution of expenditures on a given project and how far are we on target.
[Translation]
The Chair: No problem?
[English]
Mr. O'Neal: Madam Chair, I would like to give you an idea of how these things are currently accounted for in the estimates. It's clear that you'd like to have more than what they currently give.
For a major capital project, which is a budget of $1 million or more, they have a separate category that has to do with major crown projects. These are projects whose costs will exceed$100 million. For those they give quite a bit of detail.
The frigate project for the navy was mentioned. What they do, in the estimates, is that they give first of all an overview of the project. This discusses its history. Then they talk about the departments that are engaged in the project. They set forward the major milestones; that is, when contracts were awarded and when the first ship was delivered and when the last ship was delivered. Then they provide a summary of costs.
The summary of costs is broken down into the currently estimated total cost, followed by forecast expenditures up to the next fiscal year. Then there are the estimates for 1996-97. And finally they have a column that discusses future years' requirements. It doesn't really focus in on the past to the extent that perhaps you'd like it to, and I'm sure maybe we could come up with some recommendations that could address this.
The Chair: But also the threshold for that is $100 million. Is that a reasonable threshold or not?
Mr. Pagtakhan: Did you say $100,000?
The Chair: No, I said $100 million.
Mr. Pagtakhan: You said $100 million?
The Chair: Yes. If it's less than that, you don't get this kind of detail.
Mr. Pagtakhan: Yet if you have 10 departments with $100 million each, it is a big amount of money. Are you suggesting it may be too big an amount?
The Chair: Yes. Maybe we want to set that amount lower.
Mr. Pagtakhan: Yes. Let's just hope it would not be too much paperwork. I don't think so. I'm sure it was arbitrary at the time.
Mr. O'Neal: There is one other defining feature that determines what is a major crown project from Treasury Board's perspective. That's the amount of risk involved. If the amount of money is less than $100 million, but Treasury Board determines that there's a lot of risk surrounding the project, then they put in place a series of controls that call for monitoring the project and the provisions of certain kinds of information and detail.
Again, the issue of thresholds is possibly something the Treasury Board Secretariat is also looking at at this moment. That was something I was planning to bring up at the end of this little section on the scope of financial information for Parliament.
Mr. Pagtakhan: You mean the subcommittee may suggest that this be looked into, because any figure we suggest, unfortunately, has to be based on tradition, on an understanding of why it was there to begin with as the arbitrary figure. The advantage of not changing this is that you are changing fewer variables in our recommendations, and any efficiency of performance and understanding of the budget later on we can ascribe to the very few defined points that will happen as a change. So many changes - and you do not know now - contributed to the counter-productiveness of some of the changes. We just have to be very careful about that.
.0955
I have one last point. In the public accounts committee, I remember when we were examining the Auditor General's report, there was a statement of the thrust of the change to the reporting system, the so-called accrual method and non-accrual method. Where does our thinking fit into this thrust?
The Chair: I think we're going to come to that discussion in one of our later recommendations, right?
Mr. O'Neal: Again, this is something I was going to bring up when we'd finished discussing this.
Mr. Pagtakhan: Okay, so a bit later on then.
Mr. O'Neal: In a few minutes.
Mr. Pagtakhan: Okay.
The Chair: John.
Mr. Loney: Could you give us some examples that would be applicable so we could arrive at some sort of figure that would make it more practical, if it's to be reduced from $100 million?
The Chair: Okay. We'll have that when we come back in February.
Mr. Pagtakhan: Yes, for a better understanding.
The Chair: Now, supply days.
Mr. O'Neal: Madam Chair, this is the point at which I'd hoped to mention something.
What the subcommittee has been discussing over the last little while has to do in some respects with the structure of the supply votes, and also indirectly has to do with the kinds of controls Treasury Board places over these votes internally.
From what I understand, Treasury Board Secretariat is currently conducting an internal study of the vote and control framework. This would also include accrual accounting, which was mentioned a little earlier. The government has announced an intention to move towards full accrual accounting. These issues may have an impact on the vote structure.
I thought it might be appropriate for the subcommittee to recommend in its report that when Treasury Board Secretariat has conducted its study of these issues, it report its conclusions to the standing committee on estimates, which the committee has recommended be established, or to another appropriate committee of Parliament, by May 1997.
I'm suggesting this because this study is taking place in any case, and it may be a good idea to have Treasury Board engage Parliament in a discussion of its conclusions to formally give it an opportunity to hear the views and recommendations of parliamentarians on this particular issue.
The Chair: My sense is that there's still a lot of disagreement, both in the profession and in Treasury Board, about whether or not to proceed to accrual accounting. I think what Brian has suggested is extremely important, although I would put the onus a little bit different.
Given that Treasury Board is now looking at accrual accounting, the time is now to inform Parliament of the progress of their work and to keep Parliament regularly informed. As you said, this is very much going to affect the kind of information Parliament gets and potentially the way Parliament votes on what it gives to the departments. It's very much a parliamentary function, and Parliament should know of the discussions that are happening now. It shouldn't be told at the end of a two-year study, ``This is what we're recommending to you''.
Mr. Pagtakhan: You referred to a committee on estimates, which we have recommended be created, or an appropriate committee. Is the appropriate committee only if in fact the creation of the committee on estimates does not proceed?
.1000
Mr. O'Neal: That's why I placed this here. Alternatively, someone may determine that it would be better, for example, to submit this issue to the Standing Committee on Procedure and House Affairs, perhaps even to this subcommittee if it continued after its final reporting date - if it's re-established - or perhaps to the public accounts committee.
So this is to give some flexibility, while at the same time attempting to ensure that the conclusions of this study are presented to a committee of Parliament.
I've taken note of the chair's concerns. It is possible that we could rewrite a recommendation to require reporting at an earlier date. Maybe this would happen before any standing committee on the estimates is set up, so that Parliament would be informed as to the progress being made on this issue.
Mr. Pagtakhan: The reason I raise it is that flexibility is good to a point. If, for example, the expertise will reside in the committee of estimates, and we are confident it will be so... In other words, I can see that if the committee does not proceed, then there is no other choice; it has to go somewhere.
But if indeed the committee does proceed, at that point would it still be wise to allow flexibility of referral, or should it be deemed referred to that committee as the obligation, with no choice? The reason for that is to ensure the expertise of a committee to study this very issue. So I raise that as a point.
The Chair: I guess I'm concerned about a parliamentary committee being seized on to this issue and being informed as soon as possible.
Mr. Pagtakhan: Okay, this one is important, because we do not know when the committee of estimates will be created, and I see that too - and that in fact be defined as being referred to the Standing Committee on Procedure and House Affairs. That committee by tradition will then refer it to the subcommittee, because we are a subcommittee.
So we will be seized because we sit on the subcommittee. But it should be defined so that there is no more saying we'll go to the public accounts committee. Then we'll be seized with this issue again on day one and... I tell you, then the process will drag on.
The Chair: Can I raise a related issue? It's been troubling me that one of the things that may cause problems for this whole report is the very idea that we're recommending a new committee that has expenses involved, and so on.
I was talking to Brian about it just before our meeting started. I suggested that during the break he might look at how much a committee costs. I mean, we've recommended that other committees include a financial analysis in their reports, and I think we should follow our own prescription.
Mr. Pagtakhan: Yes.
The Chair: There is an option. So he's also going to consult with the researcher and the clerk of the Standing Committee on Government Operations, because that committee doesn't seem to have a clearly defined mandate. Maybe in fact the solution here is to make that the estimates committee, with some other peripheral duties. From the limited exposure I've had to it, I think it has done some of the things we could see an estimates committee doing. It has looked at contracting throughout the government, and program management in certain program areas.
I thought that Brian could talk to the staff of that committee, get a handle on what it has done, and what its mandate might be. Then when we come back in February we could discuss whether we want to define the mandate of that committee to be the estimates committee with a few other things. We could do that rather than recommending that a separate and new committee be formed.
.1005
Mr. Pagtakhan: Along that line, I have a suggestion on studying the estimated cost of the committee. If it has not already been considered, I think we should also consider the possibility of having an extra budgetary allocation for the chairs and vice-chairs of committees. School boards around the country do have a special budgetary allocation for that.
The time committee chairs do spend can really drain your budgetary allocation. So the process has to be found for such a consideration. I can see that if the vice-chair only takes the position of the chair in his absence, in essence this does not require any extra budgetary allocation.
Now, I recall something in a school board setting at one time. Although it had a higher allocation than the general membership, which had a lower allocation than the chair, I argued that it be the same as the one for the general membership. But from time to time, if the vice-chair does the duty of the chair, then at that point there will be an extra budgetary allocation. If you are only supposed to take the position of that... And it can be reversed for the vice-chair.
In other words, there is a fixed amount that goes for chairing the committee. Since by definition it will go to that person, then it should be there.
Now, I do not know how it is developed. Whether it is a part of the chair's budget for himself or herself is one approach. The other consideration is that it goes to the hiring of extra office staff who will assist the member in the performance of his or her duties.
It does... It takes a lot of time even for a chair of a subcommittee. The people do not know, do not realize. I am sure the many meetings you have had... And I didn't have this appreciation before. I looked at it only as so-called prestige; let's face it. Right? But at the same time, the load is very heavy.
The Chair: Very much.
Mr. Pagtakhan: It has not yet been recognized fully. If one were to really give dutiful attention...
So I think that as long as we are looking at the estimated costs of committees, a move to revisit this issue and give due consideration would be appropriate at this time.
The Chair: We have an earlier recommendation that suggests the Board of Internal Economy look at increased resources to the committees to enhance their work on estimates. We could perhaps work in something there, that they should also look at providing extra resources to those people who chair committees or subcommittees. This would compensate for the extra workload in their offices. You're not suggesting salary, I think, but more office resources.
Mr. Pagtakhan: No, not necessarily, but it may be an option. I will not preclude it. Whichever works best, you know.
The Chair: For instance, I think the chair of committees and the deputy chair of committees, who are active deputy speakers, get an allocation that allows them to hire an extra staff person. So -
Mr. Pagtakhan: Surely. That is like that. In other words, you will have an option. While there is extra staff and the clerk does give those resources to the chair, inherent in that position is an increased load in the office of the chair.
The Chair: Yes.
Mr. Pagtakhan: Somebody has to consult with you every evening.
The Chair: Yes. Okay.
[Translation]
Any problems, Mr. Laurin?
Mr. Laurin: No comment.
[English]
The Chair: Okay, let's turn to supply days.
Mr. O'Neal: May I give a bit of background information? For the background of subcommittee members, when supply was moved off the floor of the House of Commons and into standing committees, the opposition parties were given 25 - now 20 - days on which they could choose the subject for debate. While this was originally intended to allow for debate on supply issues, this has not necessarily come to pass.
Professor Franks testified that supply days are useless, and they do not do what they are supposed to do.
When he was speaking to the subcommittee about supply days, the clerk of the House said that the basic rules surrounding the use of supply days don't need to be changed. A better debate, more focused on supply, could be done with the volition of the opposition parties to do it specifically. He said the rules could be changed, however, to provide that a certain number of those 20 supply days be on a particular vote or supply item, rather than on a general motion.
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Professor Thomas sent a written submission to the subcommittee, in which he said that the supply days should definitely be retained in order to ensure that the opposition has the opportunity to challenge the government in a full House and to allow the opposition to set a small part of the agenda for Parliament.
I just want to refer to Standing Order 81(13), where it says:
Opposition motions on allotted days may be moved only by Members in opposition to the government and may relate to any matter within the jurisdiction of the Parliament of Canada and also may be used for the purpose of considering reports from standing committees relating to the consideration of estimates therein.
Allotted days is another term for supply days.
There are two recommendations suggested here. The first is that the Standing Orders be amended to specify that a certain number of supply days be set aside for debate on a particular vote or supply item, and that the choice of the vote or supply item should be made by opposition parties in the House.
As an option, the Standing Orders could be amended to allow the standing committee on the estimates to draw up a list of its reports. I've added here ``or the reports submitted to it'', but I think that should be changed to ``or standing committee reports on the estimates''. That could be chosen by the opposition as the subject for debate on a certain number of supply days set aside for that purpose.
The Chair: I want to suggest that this matter is primarily of concern to the opposition. Frankly, as a democrat, I'm not anxious to reduce the opposition's ability to challenge government in the House of Commons. You never know when we're going to be back in opposition. I think it's very important to maintain that balance.
I also think it's important to get the supply days focused back on supply. René, what do you think the reaction would be to saying the choice of debate is still the opposition's but we're recommending that for eight out of the twenty days that are votable, the motion has to be on a matter of supply? That would then allow the opposition to do what Mr. Williams and the Bloc have both been concerned about, which is in fact to propose alternatives to what the government has put forward in terms of supply and to say we think you should be spending $500 million less on this or $500 million more on that.
We have votes this morning. I forgot about that. I think it's a half-hour bell, but you'd better check.
Mr. Laurin: It's half an hour.
The Chair: So we have until close to 10:45.
Mr. Laurin.
[Translation]
Mr. Laurin: I do not think we need to amend the Standing Orders on supply days. Supply days are days set aside specifically for the opposition so that it can raise issues that it wants to debate.
It is clear that in the beginning, the spirit of the Standing Orders was to ensure that these days were used to debate supplies, votes. But the policy has changed since then. It can happen that certain issues equally as important as a particular vote need to be debated in the House. Like Mr. Marleau said in his testimony, the Standing Orders do not necessarily need to be changed, because the opposition parties can do as they please.
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The Standing Orders could be amended to specify that a certain number of days be set aside for debate on a particular vote. Why force the opposition to say that it will deal with a particular vote or two or three particular votes for three, four, five, seven or eight days? The privilege to do that is already there, and I do not see why the government would interfere in opposition strategies and tell the opposition that it has to discuss one vote or another.
The current Standing Orders provide the leeway the opposition needs to choose the issues it wants to attack, or to determine its strategy as critic of government budgets or estimates. If the opposition wants to devote 10 days out of 20 to supply, it can do so. Through the debate on supply, the opposition can touch on almost all of the subjects that are of interest to it.
I do not think that limiting the number of days or requiring that a certain number of days be devoted to particular votes would improve operations or the efficiency of the opposition. On the contrary, I think that would limit its rights and privileges. I say that both in the interest of the party that is currently in power and in the interest of the opposition.
I do not think that Ms Catterall thinks the Liberal Party will be in power for another 20 years. Even if the Bloc Québécois does not aspire to being in power, the Conservative Party or another party will surely take over some day, and the Liberal Party will form the opposition. I do not think that the Liberal Party will some day want its choice of topics limited on days devoted to supply. I do not think that we should touch those days.
[English]
The Chair: Does anybody from government wish to argue with the opposition on this matter?
Mr. Pagtakhan: Yes. At the moment we should retain the principle of the opposition being able to have some flexibility. It can choose to in fact focus on the supply days. I have no difficulty in not changing the rules. I think flexibility is a hallmark of our parliamentary system.
I can see that if you say you focus it on supply, in a sense the same thing will happen. Imagine that the opposition can just say they will take a vote on the budget of the Department of Health. Then, in that vote, on the opposition day you will discuss medicare and the five principles. So the same thing will happen. You take the vote on the Department of Defence and then in that vote you will be all over the place again on tax expenditures because you will say if you increase this you will decrease the funding for every other department of my choice or of priority for Canadians. The same thing will happen.
So why do we hide? Let the opposition assume its responsibility and say you have a choice to have a specific vote on a given supply. If you choose not to elect to focus on that, that's fine, that's your responsibility. Am I seeing it?
Mr. O'Neal: Perhaps as a suggestion, the report has said in a number of instances that there are certain rules or opportunities that exist already and has urged that those rules and opportunities be made use of. Where the standing order says these days also may be used for the purpose of considering reports from standing committees relating to consideration of the estimates therein, we could urge that the rule be made use of.
Madam Chair, because you mentioned that this is an issue of concern to the opposition, I feel I ought to bring to the subcommittee members' attention Mr. Williams's concerns about this. First of all, he told me he wasn't too enthusiastic about either one of the recommendations that were here. His main concern is focused on the procedure that is in place for the last allotted day. This is something he'd mentioned at the beginning of the subcommittee's hearings but hadn't talked about very much in subsequent meetings.
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If we have time, I can quickly sketch out how the procedure on the last allotted day works and tell you what Mr. Williams' concerns are about that procedure.
The Chair: May I suggest that we go through the rest of the recommendations we have here? We only have 20 minutes left. We won't be able to come back, because at 11 a.m. the steering committee on procedure and House affairs is meeting. We could come back to this on Thursday morning or we could come back to it when we meet again in February.
Mr. O'Neal: Yes, Madam Chair.
I've also asked Mr. Williams for a suggestion. In order to make a recommendation dealing with his concern, I've asked that he and his office think about it a bit and make a suggestion to the subcommittee.
The Chair: Then we can do that when he's back in February, because he won't be here on Thursday.
Mr. O'Neal: If you wish.
The Chair: And you might have some discussions with him in between.
Mr. O'Neal: Yes.
The Chair: You may remind him that I said he can't expect the government to give everything and the opposition to give nothing.
Mr. O'Neal: If I may, Mr. Williams did ask me to convey to you that he is a reasonable man.
Some hon. members: Oh, oh!
The Chair: And you've conveyed my answer that I am a reasonable woman.
Mr. O'Neal: Certainly.
The Chair: Are we agreed to take out these recommendations to look further at Mr. Williams' concerns about the last allotted day for supply?
So we can move on then to the accountability of ministers and deputy ministers. My main question about this, frankly, is I thought Treasury Board already had a set of guidelines.
Mr. O'Neal: I understand it's an issue they're considering, but their guidelines may not be reflective of current realities or realities that will soon be in place. The new sets of information being produced - the performance reports in particular and also the plans documents - mean that, at least potentially, standing committees are going to be meeting with senior departmental directors and deputy ministers more frequently.
I think it was Dr. Thomas who indicated in his submission that it was a concern of his that in cases such as this, there may be some confusion between what constitutes policy, which is the preserve of ministers, and what constitutes administrative issues, which is really where people such as deputy ministers are free to comment. He felt there ought to be some very clear rules established that could be used by standing committees and by senior departmental officials when they appear as witnesses to guide them on issues such as this.
So these recommendations merely suggest that some guidelines be established in consultation with members of Parliament and committees.
The Chair: Does anybody have a problem with either of these?
[Translation]
Mr. Laurin.
Mr. Laurin: Madam Chair, I was of the understanding that we would come back to the issue of supply days and guidelines on Thursday. You seem to want to raise the issue now.
[English]
The Chair: No, I don't want to cut the debate at all. I was suggesting we could meet again on Thursday, if need be, to finish the recommendations, and that we leave Mr. Williams' discussion on supply days, particularly on the last allotted day for supply, until after the break. If we can get through these last couple and give them to Brian to go work on, we don't need to meet on Thursday.
[Translation]
Mr. Laurin: I have a question on that. I do not understand the objective in the text that is being suggested. I would like someone to explain what the objective is. Is it to limit the freedom of officials when they appear before the committees? What is the objective?
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[English]
Mr. O'Neal: We'll just go over the testimony from Dr. Thomas.
In general terms, ministers are accountable for the policies and actions of the department they head. One witness, Dr. Thomas, suggested that if changes are made in the way Parliament reviews departments and programs, the question of whether deputy ministers - who would appear more often before committees as witnesses - should be held directly accountable for the economy, efficiency and effectiveness of program delivery by their departments is bound to come up.
He argues that while deputy ministers should be answerable, only ministers can be held accountable. He recommended that guidelines be drawn up for members of Parliament and public service witnesses to clarify these accountability relationships.
I think it was the high commissioner for New Zealand, Mr. McTigue, who was asked about this issue during his appearance before the subcommittee. He indicated that this was a concern in New Zealand as well.
I also have Peter Dobell, who's written on this question of no defining line between what is the jurisdiction of the public servant, and what is the proper jurisdiction for ministers. He said ``the result is that many officials have responded cautiously to requests for information from members of Parliament which have been addressed to them in committee meetings''. As a consequence, committee members do not get all of the information they need. Furthermore, the opportunity for collaboration between committees and departmental witnesses is sometimes made more difficult.
This is a suggestion that there be clear guidelines set up that would be available to both departmental witnesses and members of committees to help them when they sit down to discuss the estimates.
The Chair: We all have our own experiences. My own experience is that there's a great range among senior officials from the department in terms of how forthcoming they are with the committee.
It would be to Parliament's advantage to have guidelines like this that tell deputy ministers precisely how far they can go, which is farther than most of them think they can right now, before stepping over the line into what is the minister's responsibility. Then you wouldn't have a deputy minister saying he can't answer that.
On the other side of the question, I've sat in committees where I've seen committee members attack a senior official as if he or she were the minister. That's not right or fair either.
I think it would be helpful to both sides to encourage senior officials to develop a more collaborative working relationship with their committee, and at the same time let committees know what they're entitled to.
[Translation]
Mr. Laurin: I understand, Madam Chair, if that is the objective, I fully agree. If deputy ministers are to be given guidelines when they appear before committees, the guidelines must be the same for all of them, regardless of the department. Once these guidelines are established, I would like them to be submitted to the Standing Committee on Procedure and House Affairs for consideration and recommendations.
I'm afraid that the guidelines that will be given to the deputy ministers will be very restrictive and the result will be that the deputy ministers will tell us even less. If we establish that type of framework for the senior officials, they could end up telling us as little as possible.
If senior officials can no longer speak before committees, they will no longer be called as witnesses; the minister will be called in.
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I agree with establishing guidelines, but they must be put to the committee for consideration and recommendations.
The Chair: Are you suggesting that the recommendations be amended...
Mr. Laurin: We will debate it then.
The Chair: ...to include the guidelines and...
Mr. Laurin: They must be established for all departments...
The Chair: Okay.
Mr. Laurin: ...and submitted to the Standing Committee on Procedure and House Affairs for consideration and recommendations; the committee can refer them to the subcommittee if it so desires.
That will enable us to hold a debate at that time, if we feel that the guidelines are too restrictive. It's too early today to say that we agree or not. Everything depends on what these guidelines contain.
[English]
The Chair: And that would be an appropriate beginning to starting a more collaborative relationship between the senior public service and the committees of Parliament. We agree together on what those should be.
Mr. Pagtakhan: When this recommendation emerges, will there be a statement clarifying the rationale for this recommendation as you have articulated it?
The Chair: Yes.
Mr. Pagtakhan: Good. So it is to ensure forthrightness on the part of deputy ministers, and at the same time tell committee members that the accountability continues to rest with the ministers - how you bridge two delicate positions.
Before I forget, a quick retreat to the supply days. I do not know in whose days it has to be out of the 20, but I think we should still consider even just one day dedicated to a vote on supply. I do not know whose days it will be. I can see the rationale. The public may see at least one debate focused on this. Supply is so general. The idea behind that is to arouse the interest of the public to be more conscious of supply days, as was intended. That could be a compromise. I do not know on whose days.
The Chair: That's a suggestion we could consider in February when Mr. Williams is here to explain his idea. Rey may have the germ of a good idea. We didn't recommend - which was suggested by a number of people - that we set aside three weeks of parliamentary time for committees to do the estimates, but we might want to suggest - and we could work this in with our discussion on Mr. Williams' concerns - exactly what Rey just said, that there be maybe two days.
Mr. Pagtakhan: Yes, something like that - as a beginning, as a public look. The whole idea is that the public out there ought to appreciate the process.
The Chair: There's lots of opportunity. There are debates on the budget and debates on the pre-budget. There are lots of opportunities for members of Parliament to do it. I'm not sure you would gain much, if members of Parliament don't want to do it, by setting a couple of days -
[Translation]
Mr. Laurin: If the opposition does not do its job, the public will judge it. It is not up to us to tell the opposition what it has to talk about on those days.
[English]
The Chair: I'm not suggesting touching your opposition days. I think you heard my views on that.
Mr. Pagtakhan: The opposition days should be there. It's very important.
The Chair: Perhaps for all of us there should be two days where we focus on the business of supply in Parliament and there are no committee meetings. Let's talk about that in February.
I don't think we need to meet on Thursday just to look at what's left here. I think we could leave that until February. Our researcher has said he will have a draft report to us in mid-January. We will schedule our first meeting for the Tuesday in the first week of February. We're still agreed on that. We'll have you present the report to us at that time. My suspicion is that there won't be a meeting of the Standing Committee on Procedure and House Affairs in that first week, so we could spend the whole morning getting briefed on the report and start going through it in detail. Is that acceptable to everybody?
[Translation]
Mr. Laurin: Merry Christmas and happy holidays.
The Chair: Merry Christmas.
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[English]
We're ready to adjourn the meeting.
Thank you.