HRPD Committee Meeting

STANDING COMMITTEE ON HUMAN RESOURCES DEVELOPMENT AND THE STATUS OF PERSONS WITH DISABILITIES

COMITÉ PERMANENT DU DÉVELOPPEMENT DES RESSOURCES HUMAINES ET DE LA CONDITION DES PERSONNES HANDICAPÉES

EVIDENCE

[Recorded by Electronic Apparatus]

Wednesday, February 10, 1999

• 1537

[English]

The Chair (Ms. Albina Guarnieri (Mississauga East, Lib.)): Order. Can I get some order here, please? We have quorum, and we can begin.

We have a panel of experts from both the public and private sectors. They have a wide breadth of experience. I'd like to invite all our guests to feel free, as I know all of them will, to jump in and offer comments in response to comments from any of the panellists.

I'd like to introduce the following: from the Canadian Bankers Association, Linda Routledge, director of consumer and corporate affairs; Ted Rowan-Legg, assistant general counsel, Royal Bank of Canada; Richard Rudderham, vice-president, business services, Bank of Montreal; and from the Association de consommateurs du Québec-Montréal, Marie Vallée, analyst, policy and regulatory matters, telecommunications.

We also have, from Revenue Canada, Kathy Turner, director general, benefits program directorate; from the Royal Canadian Mounted Police, Staff Sergeant Victor Gareau, economic crime branch; and from the Centre de bioéthique, Institut de recherches cliniques de Montréal, Pierrôt Péladeau, scientific co-ordinator, Telehealth Ethics program.

Madam Vallée.

[Translation]

Ms. Marie Vallée (Analyst, Policy and Regulatory matters, Telecommunications, Information Highway and Personal Information Protection, Action Réseau Consommateur): If I may correct you, Madam Chair, the organization I represent is Action Réseau Consommateur, previously known as the Fédération nationale des associations de consommateurs du Québec.

The Chair: Thank you for the correction.

[English]

We will have each panel member speak briefly, five to ten minutes, and then we'll proceed with a round of questions.

Are you all in agreement that we follow the order in which I read the names?

Voices: Agreed.

The Chair: Ms. Routledge, please proceed.

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Ms. Linda Routledge (Director, Consumer and Corporate Affairs, Canadian Bankers Association): Thank you, Madam Chair, members of the committee, fellow guests.

I have with me today Ted Rowan-Legg, assistant general counsel with the Royal Bank, and Richard Rudderham, vice-president, business services, client contact centre, electronic financial services with the Bank of Montreal.

We welcome this opportunity to participate in the discussion about social insurance numbers and to explain how the banking industry uses and protects the SIN.

Banks have a long history of protecting the confidentiality of their customers' information. We were one of the first industries to develop a privacy code that went beyond a general set of principles. We participated in the development of Canada's national standard for privacy protection, the Canadian Standards Association model privacy code. The CBA model privacy code, a copy of which you have in the briefing package, was the first industry code to be independently assessed as complying with the CSA code.

In fact, we went beyond the CSA code's requirements when it came to dealing with social insurance numbers. The banks recognized that there were concerns about the use of SINs. They wanted to be sure that customers knew how their SIN would be used, and to the extent possible had a choice in whether it was used for these purposes.

The CBA code specifically deals with the two most common uses of the SIN—income reporting under the Income Tax Act and matching credit history information at the credit bureau.

As you probably know, section 237 of the Income Tax Act requires financial institutions to make reasonable efforts to obtain a customer's SIN on deposit accounts that generate interest income and to include the SIN where available on T5 reporting slips.

In section 2 of the CBA code, dealing with disclosing the purposes for which information is collected, subsection 2(5) specifically mentions telling customers about collecting and using the SIN for this purpose.

The other major use of SIN by the banks is optional to the customer. Banks prefer to have a SIN from customers who apply for credit so that they can have that unique identifier to ensure an accurate and timely match when checking on the person's credit history. When they have the SIN, banks use it during the course of repayment of the loan to ensure an accurate match when the bank provides its credit ratings on the loan to the credit bureau.

With many people having similar names, and some family members with similar names at the same address, the possibility of a mismatch is high. With a unique identifier such as the SIN, the probability of an exact match is increased considerably. It is in the customer's best interests to have only accurate information about them in the credit bureau files and to not have their credit history mistaken for someone else's.

That being said, if a customer does not see a benefit to providing the SIN for this purpose, other less unique information can be used, albeit with somewhat less accuracy. Moreover, the banks have committed that they will still consider the customer for the loan without the SIN. A customer will not be turned down for a loan just because the customer refused to provide a SIN. Subsection 3.6 of the CBA code sets out the credit bureau use commitments.

The banks have also recognized that a mechanism to handle any concerns about the use of the SIN is necessary. The individual banks have complaint-handling systems to check into any concerns customers have, including the use of SIN and other privacy matters. Individual bank ombudsmen are the final recourse for customers within the banks, and the independent Canadian Banking ombudsman can be called upon if the customer is still dissatisfied.

We trust this serves to clarify how SINs are used within the banks and how the banks respect and protect this sensitive information. We support the Auditor General's conclusion that fraud associated with social insurance numbers must be reduced and that Canadians' privacy in this respect must be protected.

We look forward to participating further in today's discussion.

The Chair: Thank you.

The next speaker will be Marie Vallée.

[Translation]

Ms. Marie Vallée: Thank you, Madam Chair.

Ladies and gentlemen, members of the committee, the organizations Action Réseau Consommateur, previously known as the FNACQ, is glad to appear before you today. For several years, we have been taking an active interest in protection of personal information issues.

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We have representatives on the committee that developed the model code on the protection of personal information. We participated, together with other groups such as Option Consommateurs, in the debate that preceded the enactment of the law on the protection of personal information in the private sector in Quebec. We also appeared many times before committees of the National Assembly as they dealt with the personal information protection issue. We also appeared before the CRTC in cases that involved the protection of privacy in telecommunications. We participated in the National Assembly debates on the possible implementation of a Quebec identification card. Yesterday we were heard by the Standing Committee on Industry, which is reviewing Bill C-54 on the protection of personal information in the private sector.

The Auditor General's Report published last September obviously aroused our interest. His observations merely confirmed what we know, and this is a matter of great concern to us. Actually, the federal government has, for all practical purposes, lost control not only of the issuance and replacement of social insurance cards, but also of the uses that are made of the social insurance number, which have outgrown the purpose for which it was implemented.

Over the years, within government organizations, both federal and provincial, to help manage various programs, practices have been adopted that use the social insurance number as a key, or an “open sesame”. Those practices have increasingly given rise to a trade of personal information among various government data banks and this has obviously been going on without the consent of the persons involved in most cases.

Furthermore, something that is even more insidious at this point is the fact that the social insurance number is currently being used by companies. Some have legal obligations, as Ms. Rowan- Legg mentioned, but others use it without really needing it and without any obligation to do so.

Already in 1972, a report by the federal Department of Communications raised the important issue of a single identification number in Canada to help improve management as government organizations became computerized. The report concluded that even if a single identification number became a fact of life, as it seems to have become through an ever-increasing use of the social insurance number, it would be essential to ensure that it not be adopted, directly or indirectly, without an in-depth study of the consequences and a wide-ranging public debate on the merits and the consequences of using a single identification number.

Canadians have always been concerned with the protection of their personal information. They are very worried, specifically by the trading of data among data banks that permits the creation of a unique profile of each individual and especially given the fact that anyone at all can access their personal information. Further, the fear of being reduced to a mere number in all these computers is also a matter of concern for our citizens. Already in 1972, according to the study I mentioned, 62% of Canadians were afraid that computers might reduce them to mere numbers. During these past years, the fears of Canadians, regarding the private sector but also regarding the public sector, have continued and become more wide-ranging.

Several polls, including the ones carried out by our organization and by Ekos and the one that the federal government just did on electronic commerce issues, show that the fear of having one's privacy invaded is still there. It is clearly apparent that transparency in the use of information causes problems. We can no longer tell who is doing what with whom when our personal information is being used. We give out information when we apply for loans and scholarships, these are transmitted to Revenue Quebec, which sends them to the federal Department of Revenue, which sends them on to the employment insurance office, which sends them to Customs, and the litany could go on and on.

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What must understand is that citizens have lost control over the use that is made of the information they have given for a specific purpose and which has been disseminated all over the place, most often without their knowledge and especially without their permission.

Government controls must certainly be applied, specifically when there is money to be given out. But this desire for efficient management should not be realized to the detriment of the basic principles of protection of personal information.

I will skip over reading the principles, which you will find on pages 4 and 5 of my brief. In any case, these principles have been generally accepted by the OECD.

We have been asking questions about the management of the social insurance number. Recently we saw that HRDC had implemented certain measures for checking the identity of SIN applicants, but at this point the debate must be broadened to make sure that the current use and exchange of data is respectful of the basic principles of protection of personal information.

It would be highly desirable to get the consent of citizens when data is used for other purposes, rather than to inform them that it is going to be done, and very often after the fact, through the news media.

We should frame better regulations for the exchange and matching of data bases among governments and to ensure that private enterprise only uses the social insurance number when it is legally obliged to do so. Bureaucratic efficiency must not be used as a pretext to continue infringing on the basic rights of citizens to have their personal information protected. Error and fraud must be tracked down; however, we must avoid setting up large scale surveillance mechanisms and especially we must inform and educate our citizens more and more.

If amendments to the rules are deemed necessary, we must absolutely allow for a wide-ranging public debate. Thank you very much.

The Chair: Thank you.

[English]

Ms. Turner, you have the floor. Please make your comments.

Ms. Kathy Turner (Director General, Benefit Programs Directorate, Department of Revenue): Madam Chair, members of the committee, I'd like to thank you for inviting me to appear.

We're here today because we all share a common goal—to improve the reliability, security, and management of the social insurance number.

Revenue Canada appreciates very much the scope of the recent review undertaken by the Auditor General. We see that major shifts have taken place in the way in which the social insurance number has been used throughout Canada within the public and private sectors. I think these changes point to a need to re-examine the fundamentals of management of the social insurance number.

The Auditor General looked at the management of the social insurance number and outlined his concerns. In response, Human Resources Development Canada organized five working groups to address these concerns.

Today I'm going to limit my comments to Revenue Canada's use of and need for the social insurance number as well as our involvement in the five working groups that have been established.

How does Revenue Canada use the social insurance number, and why do we need it? As the Auditor General noted, the social insurance number was first implemented in 1964 as a client file identification number for the unemployment insurance program, the Canada pension program, and the Quebec pension plan.

In 1967 the Income Tax Act was first amended to authorize the use of the social insurance number on tax returns. In 1976 the act was again amended to require individuals cashing Canada savings bonds to provide their social insurance number. This resulted in insurance companies and financial institutions having to collect their clients' social insurance numbers for income tax purposes.

In 1988 the Income Tax Act was amended to require financial institutions to provide the social insurance number on slips issued for bank interest, and in 1992 a further amendment required provinces to include the social insurance number on slips issued to recipients of social assistance and workers' compensation payments.

Today we require the recording of SINs in various places as part of the administration of taxes. We use the social insurance number only for the limited and specific purposes required under the Income Tax Act.

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For Canadian income-tax filers, the social insurance number is a unique file identifier. We use it to assess your taxes and we use it for the income-tested benefit programs that we administer under the Income Tax Act, such as the Canada child tax benefit program and the goods and services tax credit. It's a valuable tool that allows us to provide efficient, secure and fair revenue administration to Canadians.

Tax filers can have numerous information exchanges with a variety of institutions in matters relating to their income taxes. To give you a flavour for the dynamics of these information exchanges, I'd like you to consider a particular client.

In any given tax year, a particular client can exchange information with his or her federal and provincial governments for income taxes, benefits, social assistance and workers' compensation. He or she may interact with employers for tax deductions at source, for CPP contributions and for employment insurance contributions. He or she may exchange information with financial institutions for such things as the interest payments on bank accounts or RRSP contributions.

The number of institutions that any particular client may need to deal with on financial matters can be quite large. In most cases, the only common piece of data amongst all the institutions and the client is the social insurance number. Revenue Canada takes advantage of this reality and records all client data pertaining to income tax by using the social insurance number as the account number.

While the SIN is recorded on millions of information exchanges with Canadians each year, Revenue Canada takes every step to ensure that personal information is protected. Social insurance number information is collected and processed within strict guidelines under a number of federal statutes. The Income Tax Act, the Canada Pension Plan Act, the Employment Insurance Act and the Privacy Act, among others, compel us to provide stringent safeguards. We place a priority on maintaining the privacy and confidentiality of any taxpayer information we collect. This information is not shared unless authorized by the taxpayer or by law.

I would like to move on to our involvement with Human Resources Development Canada in addressing the issues raised by the Auditor General in his report.

One way in which Human Resources Development Canada responded was to organize five working groups to address the findings of the Auditor General. Revenue Canada is currently participating in four of these five working groups.

Considering that we are one of the largest users of the social insurance number, it's evident that we have an interest in the future of the social insurance number and its administration. Any changes, whether they're operational changes or policy changes, will have an impact on Revenue Canada. So that our service to Canadians in matters pertaining to their taxes or their benefits is not hampered, it is important that we voice our needs over the next number of months as the working groups address the Auditor General's findings.

Later this month, Revenue Canada will participate in an HRDC-sponsored working conference related to identity fraud. The aim of this working conference is to share, amongst the participating federal departments, best practices and use for identifying and preventing identity fraud and the misuse of the social insurance number. We will be analysing any efficient methodologies that we're exposed to during this conference for possible incorporation into our business practices.

I would also mention that we are regular participants in an annual HRDC-organized meeting concerning the social insurance number. Representatives from the social insurance registration function of HRDC, the Canada Pension Plan, the Régie des rentes du Québec and Revenue Canada meet once a year to discuss various topics related to the administration of the social insurance number and its maintenance. The main objectives of these meetings are to share expertise and to discuss the development and possible adoption of policies or procedures that will improve this administration.

We are also currently working with Citizenship and Immigration Canada as well as Human Resources Development Canada to identify the risks associated with the issues of temporary social insurance numbers, a matter raised by the Auditor General in his findings.

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Improved safeguards for Canadians and greater reliability in information exchange with regard to the social insurance number are our immediate goals. Ultimately, the broader question of the role of the insurance number or any other unique identifier used for the administration of income tax and social benefit programs must involve the federal government, the provincial governments and the private sector, as well as individual Canadians.

Madam Chair, I'd like to tell this committee that Revenue Canada will assist all efforts to address the problems that the Auditor General has identified with the management of the number. We're also fully committed to enhancing the integrity and security of this system.

Thank you.

The Chair: Thank you very much.

Sergeant Victor Gareau, please.

Staff Sergeant Victor Gareau (Economic Crime Branch, Royal Canadian Mounted Police): Thank you, Madam Chairman and honourable members of the House.

I'm with the RCMP. I'd like to say a few words about the different types of fraud committed with the use or misuse of the social insurance number.

Quite obviously, the fraud that is most frequent is that of an individual creating a different identity for himself. He could quite easily create 15 or 20 different identities for himself and then proceed, with fraudulent documents, with the application for benefits under employment insurance. We in the police community have always felt that it is fairly easy—if not too easy—to obtain a social insurance number in this country. It can be done by mail. Only one document is required, usually a birth certificate, which can very easily be bogus or counterfeit.

Of course, fraud committed with the use of fraudulent social insurance numbers can be not only against HRDC with regard to the employment insurance benefit, but against any federal or provincial government. For example, GST refunds and social welfare of any type require a social insurance number. We have seen cases in which individuals have had 15, 20 and 30 fraudulent claims going on at the same time.

The other situation is one in which fraudulent social insurance numbers are used not to commit fraud but for the purpose of providing an individual with an identity. We see this mostly with people coming into the country illegally.

I'll say a couple of words about the type of enforcement that's going on right now within the RCMP. HRDC has the primary jurisdiction for investigation of the fraudulent issuance of social insurance numbers. They do a very good job. I am told they have a request right now with the Treasury Board for additional resources to investigate this. In some cases, HRDC will come to the RCMP with a request for assistance. I will tell you about two cases that we have going on right now in Montreal.

One of them involves a woman from Jamaica who has committed fraud in excess of $250,000 against the employment insurance program and almost as much, if not more, against social assistance. She also has some credit card fraud. Today, as we speak, our members are in the process of doing the arrest in this case in Montreal.

Another case we investigated a month ago involved a person from Belgium who came into Canada illegally. He has seven different passports, all fraudulent Canadian passports, and seven different identities, including the social insurance numbers. He was also in the process of fraudulently claiming benefits from the federal government.

These are the types of situations we encounter on a very regular basis.

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With regard to the privacy issue, I will say just a few words. For example, it is impossible for us to obtain any information from the SIN registry with the use of paragraph 8(2)(e) of the Privacy Act, because there is a provision in the Employment Insurance Act that prohibits the release of any information to the police—or to anyone—unless it is for the application of an investigation, of course, under the act.

The RCMP and HRDC entered into a formal memorandum of understanding in 1983, I believe—it was a long time ago—whereby in some very specific cases they are allowed to provide information to us. There are three situations.

The first is when a deceased person is found with a social insurance card in his wallet. It provides us with information so that the police may notify the next of kin.

Second, many people, as Marie Vallée said in her presentation, feel the SIN is used for multiple reasons that go beyond what the number should be used for. One of them is that many people will identify some assets, such as a boat or a gun or a bicycle, with their social insurance number. In order to return the lost or stolen asset to its rightful owner, they will provide the information to the police.

The third case is to establish a positive identification of an individual.

That's about it for my presentation. Thank you.

The Chair: Thank you. I think you've captured our imagination here.

[Translation]

Mr. Péladeau, you have the floor.

Mr. Pierrôt Péladeau (Scientific Coordinator, Tele-health Ethics Program, Centre de bioéthique, Institut de recherches cliniques de Montréal): Good afternoon. Thank you for your kind invitation to participate in your work on the social insurance number.

I am very glad to meet with you today, especially as this meeting is occurring almost exactly, within a few minutes, a week after the filing of the final report of the Advisory Committee on the Health Infostructure, where I collaborated as a consultant and member of the committee task force on strategic issues, including personal information protection and similar matters.

In its report, the Advisory Committee makes clear statements regarding the options available for identification numbers, including the social insurance number. I'll quote the September interim report:

Concerned with efficiency, authorities have often thought about adopting personal identifier systems to facilitate the interface between citizens and governments in different areas. The Council is presently opposed to such identifier systems being used for multiple purposes, especially where health is involved.

Obviously, the Council is referring to matters of health, to privacy issues, but it was clear in the mind of the Council members that the main reason why this recommendation was made was in order to preserve the health of Canadian citizens.

The Council goes on, saying:

Actually, we believe that the effort to improve or to merge personal identifier systems, even if it only concerns health,...

So, this is not exclusively reserved to health.

...should not be consented to...

Here we have three conditions: a legislative framework to protect personal information, especially personal information regarding health; a widespread adoption, across Canada, of techniques for protecting privacy otherwise knows as privacy-enhancing technologies, in all federal and provincial mandates; and finally, ensuring the compatibility of electronic systems.

That is what the interim report said in September.

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In its final report, the Advisory Council repeated its recommendations, including this one, and added that federal and provincial laws should henceforth include provisions that prohibit the use of personal identifiers meant for health for any other purpose than health. This is the position of the Advisory Council. We can discuss it with you, if you like.

Having said that, we note that the Auditor General's Report is the result of an in-depth study on the status of the social insurance number, but that it is essentially limited to the federal State apparatus; it deals but very little with the provincial situation and almost not at all with the private sector. As a matter of fact, the Auditor himself emphasizes the need for a better understanding of the overall situation and recommends that studies be made to see what is being done outside the realm of the federal apparatus.

If you'll allow me to be facetious here, I would say that if we concentrate only on what is happening in the federal sector, the Auditor General's Report looks somewhat like a report made by engineers recommending to check the plumbing in the Titanic while disregarding the fact that the ship has a gash in its shell. This may be a caricature, but the conclusion that can be drawn from it is real. The Auditor's recommendations addressed to federal public organizations will not plug the leaks in the system, such as those in the social insurance number system, and even less help set it back afloat.

A case in point is the telephone forum held this week on the TVA French television network, where people were asked to talk about their experience with the social insurance number. The lines were quickly flooded with calls from people whose identity had been usurped through the social insurance number to obtain benefits, both in the public and in the private sectors. And also, conversely, all kinds of people reported having had access to very long lists of persons with their names, addresses and social insurance numbers which could have allowed them to commit fraud or to usurp someone's identity.

I would like to mention another point raised by the Auditor General. In their reply to the Auditor General's report, Industry Canada and the Department of Justice maintain that laws for protecting personal information could solve the problem of aimless collecting of social insurance numbers and its wrongful use in both the public and private sectors.

In Quebec's experience, where there is a law aimed at both public and private sectors, this will not solve the problem. Other measures will have to be adopted, including concrete answers to the need for reliable citizen identification during transactions, both in the public and private sectors, as well as specific prohibitions against using the social insurance number for purposes other than those specified in the Act.

Let's just come back to the issues directly raised by the Auditor General, mainly the use of the number in the public sector for purposes of social insurance and for tax collection. The Auditor suggests that we discuss the two possible solutions that he has envisioned. The first would be to improve the current framework so as to take into account the current use of the social insurance number, and the second would be to find an acceptable option to meet the needs of users, both government and private individuals.

In my mind, neither one nor both of the solutions will be sufficient. As a matter of fact, we would do better to do a systemic analysis, I mean an analysis of the system as a whole, of the overall use of the social insurance number and other kinds of identifiers, in order to find the systemic solution. And among other things, the solution could—and I stress that that means that it could among other things—involve a radical simplification of our social security system, in order to reduce the number of circumstances requiring the identification of citizens and reducing at the same time the need to match information files of different organizations and programs, and this would be for the simple reason that these programs would no longer exist.

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So we must study this issue in its entirety. If we can reduce the demand or need for identification or for matching data bases, we can plug the leak much more efficiently.

That was my opening statement. I would be glad to discuss my conclusions with the committee members. Thank you.

The Chair: Thank you. I see that there are many questions for you. So let us begin right away.

[English]

Mr. Johnston, you have ten minutes.

Mr. Dale Johnston (Wetaskiwin, Ref.): Thank you, Madam Chair.

I'd like to thank you all for your presentations.

I think it's rather interesting, with the original intent of the SIN, how easily it can be changed, either through legislation or Order in Council, and how its scope can be broadened. That in itself is a concern to me.

As well, when I hear that we have to come up with a simplified method for a common identifier number, that concerns me, because when we try to simplify things and yet make them complex enough that....

As you said, Sergeant, we have people who now have built seven or eight identifies around one of these cards. If I understood you correctly, it is possible to use fraudulent SIN cards to start to build an identity for yourself.

S/Sgt Victor Gareau: What they do in those cases, sir, is invent different names for themselves and then, using these different names, apply for different cards. One person can have only one social insurance card in this country, so they invent 15 or 20 names for themselves. Then under each of these names they counterfeit a birth certificate and submit a request to have a SIN under each of those different names. Then they have their 15 to 20 different identities.

Mr. Dale Johnston: I think that works into the point I'm attempting to make, that if we have a system whereby a number is assigned to you in place of your identity, then we leave ourselves in a position where your identity can be manufactured, or it can be fraudulent, because you're simply identified by a number.

Now, in a lot of our attributes, my colleague Larry and I are quite similar, but we are two totally different people, I can assure you.

The Chair: Larry expressed a doubt there.

Voices: Oh, oh.

Mr. Dale Johnston: Even if our SINs were similar—even if they were identical—the fact is, our identity is absolutely unique.

Mr. Larry McCormick (Hastings—Frontenac—Lennox and Addington, Lib.): Yes, in Ontario we pay sales tax. That's my complaint.

Mr. Dale Johnston: I think any system we come up with that is going to be based on a number is going to have that inherent flaw.

I know, Sergeant, you feel the application for a SIN card is far too easy, and it's far too easy to get one. But I'm really concerned about the whole privacy aspect of this and the fact that the more we try to fix this system, the more we leave it open to....

It's like trying to manufacture the absolutely perfect banknote. When you do that, all you do is put up more challenges for people who are really determined to counterfeit.

Mr. Larry McCormick: Where there's a will, there's a way.

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Mr. Dale Johnston: Are there any comments?

The Chair: Are you asking for an alternative to...?

Mr. Dale Johnston: Well, okay. The specific question is whether anybody at the table is concerned about the invasion-of-privacy aspect of SIN numbers.

Ms. Kathy Turner: We at Revenue Canada are certainly concerned about the privacy aspect, whether it's a social insurance number or any other account number that we use. We do have very strict laws that protect what we do with tax data.

I think the sergeant also gave the example that even when it's a police matter, you can't always get the information from HRD. Certainly Revenue Canada cannot give information we've collected for the purposes of taxes to anyone for any other purpose, so we are very concerned about limiting it to the use for which it is intended.

Mr. Dale Johnston: I'm very aware of procedures with Revenue Canada, because of course my office gets requests from people who can't get any information without their consent. But I'm talking about the possibility of the SIN number being used for almost anything.

Nowadays, people in the department stores will ask you for your SIN number, and if the Canadian public isn't aware that they are not obliged to give anybody, unless mandated by law, their social insurance number, they automatically put this down on their form when they apply for a card at The Bay, or Eaton's, or whatever. Obviously, what you have to do is inform the entire public that they are not under any obligation, except by statutes that were established in 1964, 1967, 1976, and 1988, to give those SIN numbers to anybody.

Mr. Larry McCormick: That's a good point.

Mr. Dale Johnston: I think that is a gargantuan task, to try to educate the entire Canadian population, so I would like your comments on what you see as a solution to that particular problem.

The Chair: Mr. Rowan-Legg.

Mr. Ted Rowan-Legg (Assistant General Counsel, Royal Bank of Canada; Canadian Bankers Association): For your information, the practice at the Royal Bank with respect to collection of social insurance numbers with respect to a credit product, for example a Visa card or a line of credit, is it's optional. The customer does not have to give the social insurance number, and it so states on the application form we're using at this time.

With respect to a deposit account, we would, of course, ask for it, as required by the Income Tax Act, but if the customer refuses to give it we will nonetheless open the deposit account. If they don't give it with respect to a credit card or a loan product, we will respect that choice and will proceed with the application. It may slow up the credit adjudication process a little bit, but that's the only result.

Mr. Dale Johnston: My point exactly is when these people come into the bank to open a deposit account, are they informed that this is an optional thing?

I can recall that I went to my bank one day—I think it was in 1988—and they said “No, we have to have your SIN number”. I asked what they needed that for, and they said “Well, we have to have that”. I was not told that was an optional thing, and I don't think anybody else I know has been. It was given to me as a sort of thing I had no choice in.

Mr. Ted Rowan-Legg: I think there's a difference between an account where we're obliged under the Income Tax Act to make every reasonable effort to get it and a Visa card or a loan where the application form itself—in our case, at least—uses the word “optional.”

Mr. Dale Johnston: Okay. I just want to make the point that the average Canadian is quite a compliant person, and when they are handed a form to fill in about their birthdate, age, income, and so forth, if one of the blanks says to fill in your social insurance number, most people do that because they assume, quite wrongly in most cases, that if it's on the form you have no choice but to fill the thing in.

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I think this is a real problem with the whole idea of having a common identifier. The information I was given, if I got it correctly, is that you—a bank—could ask for the SIN number in regard to repayment of a loan, although it was optional. Why didn't the bank just simply assign a number to the loan? I don't think it should be any obligation of the federal government to put out common identifiers for the convenience of the banks.

The Chair: Ms. Vallée.

[Translation]

Ms. Marie Vallée: Financial institutions are often the target of our attacks, and in some cases, this is justified. On the other hand, there are even more disturbing things going on elsewhere. Let's take for instance stores that rent video cassettes and often ask for your social insurance number. In my opinion, it is far worse to have to give your social insurance number to a store like that than to a bank that has certain legal obligations to meet. Banks should perhaps clarify their policies and practices, but I think that they have made some efforts to do so over the past few years. As the saying goes, there is always room for improvement. But there are cases where there is no justification for asking us to disclose our social insurance number, especially in the video cassette stores, or when using a debit card, when we are asked to write our telephone number on the bill. There is no justification for such practices.

I agree with you that there is much work to be done to raise public awareness. We should teach schoolchildren to be a bit more careful with their social insurance numbers.

[English]

The Chair: I'd like to ask the sergeant for clarification to a question asked earlier. How widespread is this crime? Can you give us any insights into this? Is there an estimate, a guess, or do we have any documentation that could be helpful?

S/Sgt Victor Gareau: We don't necessarily have any statistics on this, Madam Chairman, but just off the top of my head I could say.... Again, not all of these crimes are investigated by the RCMP; many of them are committed within city limits in Canada and they are investigated by a local police force. It's very difficult to get statistics. There are some going on on a regular basis. How many times is it done in a given year? I don't know. It's difficult to determine. Is it once a month, is it every week? Nobody knows.

Somebody who makes use of a fraudulently obtained social insurance number to apply for credit at The Bay, Sears, or wherever is in fact committing some type of irregularity, and perhaps we will never know about these.

The Chair: Is it fair to say that given all the other priorities of the police, it's not realistic to depend on the police to counter this fraud, and that it could occur on a large scale?

S/Sgt Victor Gareau: As I indicated earlier, the primary jurisdiction to investigate these anomalies lies with the department that issues the card and is the watchdog. I would say they are very, very careful with the information that is contained in the SIN registry.

Now of course, from a police point of view, to avoid issuing these cards so easily, we would like to see perhaps a picture of the individual on the card. And to go one step further—though I know I will be told we don't want to create a police state in Canada—in some cases we could have a fingerprint. I know the debate has been tossed around before, but if we want to have a foolproof system, this is what we would need. But I know very well from the outset that we will not go to that extent. Otherwise, it's simply too easy to obtain these cards.

• 1630

The Chair: In essence, what you're really saying is it's the responsibility of the SIN system to protect itself, right?

S/Sgt Victor Gareau: Yes, and they have been looking at options like putting a chip in the card, creating PIN cards—a personal identification number for every social insurance claim, for example, to protect the integrity of their own system. They have been looking at these options, but at what cost? We know that to create a card with a chip would normally cost perhaps $10, so if you look at the population in Canada, it would be an outrageous cost.

The Chair: Thank you for that clarification.

Now to a short supplementary by Mr. Johnston to his own question.

Mr. Dale Johnston: Thank you, Madam Chairman. I just want to make it clear I'm not out to attack any organization, whether it's a financial organization or....

My point is that there is a big problem with the SIN. I think we have to look at trying to fix the system so we have a common identifier number that can be used for these mandated instances and allows the Canadian people to maintain their privacy. The reason I asked the questions in the way I did was in the hope I would get some ideas from you folks on exactly how we would go about walking down that very fine line.

The Chair: Thank you, Mr. Johnston.

[Translation]

Mr. Crête, have you any questions?

Mr. Paul Crête (Kamouraska—Rivière-du-Loup—Témiscouata—Les Basques, BQ): Yes. This round table looks a bit like the social insurance number; we must find the right targets.

My first question is addressed to Ms. Turner from Revenue Canada. I was amazed to hear that the rules for authorizing data matches were very strict and stringent, as we know that for two or three years, HRDC matched its data with Customs to detect unemployed travellers and this was never been declared illegal by any judge.

I'd like you to explain the process which allows an organization to use this data and to match it in this way. Shouldn't the Privacy Act have priority and provide that it is up to the organization or department that wants to match the data to prove that it is justified, rather than up to the Privacy Commissioner, as happened in this case at hand?

[English]

Ms. Kathy Turner: I think there are two questions.

First, with respect to your asking about Canada Customs matching data with Human Resources Development Canada, that was recently found to be an illegal use of information obtained by Canada Customs. It was used improperly or illegally by Human Resources Development Canada to seek out people who may have been committing fraud with employment insurance. I would just comment that the social insurance number was not part of that particular exercise. Canada Customs did not have the social insurance number and did not give it. The matching was done with the declaration cards the travellers fill out when they cross the border.

[Translation]

Mr. Paul Crête: I was asking you to explain the current process for us. Are individual citizens, rather than the government, still asked to provide proof?

[English]

Ms. Kathy Turner: I'll give you a couple of examples, with respect particularly to income tax. One is if Revenue Canada is asked to provide data we've gathered for the purposes of income tax to another organization. It may be a provincial government or some other organization that seeks to get the data from Revenue Canada. Firstly, we have to assure ourselves it is a legally authorized use of the data. Secondly, if their purpose in wanting it is not to administer a particular act, then they must have the consent of the individual whose data is being sought.

• 1635

For example, there could be a provincial program for which they may want some data from Revenue Canada. They have to have the signed consent of the person they're asking us about. We need to satisfy ourselves that we have that individual's consent before we give the data. There has to be active consent.

[Translation]

Mr. Paul Crête: Although my question was broader in focus and relates to what Mr. Péladeau said, it is directed at all our witnesses. It deals with the fundamental issue facing our committee, which is far from an easy one. We studied this problem 15 years ago, but we did not find an answer to it.

If you had to choose between making internal corrections to the system or adopting a more universal approach, which could, for example, take into account the systemic approach advocated by Mr. Péladeau, what would you do?

Our committee has to take a stand on the recommendations made in the report and either determine that the problem should be dealt with internally, within Human Resources Development Canada, which would be responsible for managing it, or decide that the problem goes much beyond the Department, and that we should be adopting a much broader approach and look at the way social insurance numbers are used not only by government, but also by the private sector. I would like to know what each of you thinks about this.

[English]

The Chair: I would encourage any or all of you to respond.

[Translation]

Mr. Péladeau.

Mr. Pierrôt Péladeau: I think we should adopt a multi-pronged approach. Some less costly measures could be introduced immediately and that would send out an important signal. It is possible to ban the use of social insurance numbers for purposes other than those set out in the Act and to indicate this on all new social insurance cards. In this way, when people receive their card, they will find out about this.

It is important to prohibit the misuse of SINs. As I was saying earlier, a Privacy Act would not result in reduced use of SINs by the private sector. Let me give you a rather flagrant example. In 1994, there was legislation governing the private sector. At the time, I was working in the private sector helping a number of organizations comply with the Act. A major public utility, with hundreds of thousands of clients, wondered whether or not it could continue to collect social insurance numbers. There was a very heated debate on this within the company. People were tearing out their hair until we asked them how they used the social insurance number. We investigated this and interviewed close to 400 people who worked with clients until we finally found one who remembered that some years earlier, social insurance numbers had been used in a few dozen cases for recovery purposes. In practice, they did not need the social insurance number.

Despite the existence of the Privacy Act in the private sector, which stipulates that only the necessary information may be collected, the company nevertheless decided to continue to provide a space in which people had an option to enter their social insurance number or not. If clients preferred not to disclose it, no one put pressure on them to do so. In any case, people could complain to the Information Commissioner and might win.

There must be a clear signal sent. It is not enough to have a Privacy Act that states that we are supposed to collect only the information required. So we should start by banning the misuse of SINs, next state this on new cards and finally, deal with the question head-on, because there is a danger that social insurance numbers may remain in the public domain and that private institutions, municipalities and libraries might be inclined to collect them, because we will still not have found a reliable way of identifying Canadian citizens. Until we have solved this problem, the issue will remain. Companies collect this information largely because they want to protect themselves in some way. The simplest way of doing that would be to ask people to give them the pieces of identification they have in their pockets or the information they remember. I could tell you a number of stories about this, but I will refrain. Those are the main points I wanted to make on this.

Whereas some inexpensive measures may be introduced externally, we cannot disregard all of our identification needs as a society, given that we're doing more and more of our transactions remotely, either by telephone, increasingly, through the Internet.

• 1640

I mentioned another aspect: we have to take a closer look at all of our social programs. That is another operation. At the moment, we are increasing the number of loan, employment insurance, social assistance and other such programs, which all require investigations and checks. There might be some way of simplifying this whole process tremendously.

A number of proposals have been made, including the famous guaranteed income for our citizens. It would mean that we would abolish all our programs and give everyone a set amount. This would allow us to simplify our checking procedures and avoid increasing the ways in which numbers of all sorts are used. This approach would also greatly reduce all the requirements for data matching.

In other words, we would have to look at the overall economy of our systems. We would then realize that our social programs, particularly our income security programs, require a great deal of checking, and that this could perhaps be eliminated if the programs were designed so as to avoid the need for all these checking procedures.

Mr. Paul Crête: I was wondering whether any of our other witnesses might care to answer my question. Should we decide to correct the system from the inside, by trying to correct its shortcomings, or should we, rather, reopen the whole debate and look at the issue as Mr. Péladeau has described today? Should we not start by dealing with the problem of finding a reliable way to identify citizens, and then try to find the right approach? There may be no single answer. Would any of the other witnesses like to make some suggestions that might help the committee with this issue?

Ms. Marie Vallée: I think we have to fix the problems and I think we have to do it now. The Auditor General's Report says that this is urgent. I think Human Resources Development Canada has already started doing that. It has set up some working groups and will be carefully reviewing their findings. In other words, there are some incorrect uses of the social insurance number that will continue.

You ask whether we think the debate should be broadened. Maybe it should. This has been tried in Quebec and it was found that we were not yet sure enough why a single universal identification number would be used, because in everyday life, it is extremely rare that people have to identify themselves. This does not happen frequently enough to require a single identification card with a single number that could be used in dealing with Revenue Canada, Revenue Quebec, the Royal Bank, the university, and so on.

So do we really need a debate of this type on the pretext that there has been so much misuse of social insurance numbers that now everybody and anybody is using them for all sorts of purposes? Should we start by correcting the immediate problems and then follow Mr. Péladeau's suggestion and renew all social insurance cards, indicating very clearly that the SIN is only to be used for specific purposes, and not for others? In other words, should we be undertaking some education programs? Are we prepared to get into a debate on single identification numbers?

We think that, particularly in the case of an organization, the introduction of a single ID number would be extremely dangerous. A single number that could be used by the private and public sectors, given the general trend toward computerization throughout society and the increasing popularity of remote transactions, would make it easy to get profiles of any Canadian simply by matching data. It would feel very much as though Big Brother were watching us. And it would be extremely difficult to control this once the process was underway.

The Chair: Thank you.

[English]

If there are any divergent views, please feel free to rebut or to add to the discussion. I encourage you to do so.

Ms. Routledge, did you have something to add to this?

• 1645

Ms. Linda Routledge: In terms of offering the solutions you've been looking for, I feel my hands are tied, because this is not something we've actually looked at as an industry. So I can't offer an opinion on that. I apologize.

The Chair: No problem.

[Translation]

Mr. Crête, I think you had a very brief question.

Mr. Paul Crête: A very brief question for Sergeant Gareau.

I don't know if you're going to be able to answer. The Auditor General told us that Human Resources Development Canada had seconded some investigators in charge of investigations on the social insurance number to employment insurance during the last year or two because of quota objectives in that area. Does that decision seem relevant to you? Or should the number of investigators assigned to the social insurance number be increased, on the contrary? I think it's Ms. Turner who told us there had been a request for extra resources. Could that help solve part of the problem?

S/Sgt Victor Gareau: Yes, indeed. In the past, maybe there was less emphasis put on investigations of false social insurance numbers. We put more emphasis on the investigation of frauds as such.

Now, this week and last week, some colleagues told me about new positions created by Treasury Board and assigned to the Department to investigate only the abuse of the social insurance number. It seems to me we'll be getting 34 positions which means about three per province. For cities like Toronto and Montreal, three investigators seems a bit low to me. In fact, there should perhaps be more investigators looking at that problem.

Mr. Paul Crête: Fine.

The Chair: Next turn.

[English]

Monsieur Dubé, I see you're eager to ask your questions.

Mr. Jean Dubé (Madawaska—Restigouche, PC): Thank you very much, Madam Chairperson.

You know, when we returned from our summer holidays and started talking about SINs, I thought it would be a simple housekeeping matter, but I see it's very complicated, very complex.

We've discussed at many meetings how people can commit fraud with a social insurance number. I always thought it was because they were getting access to numbers of people who were deceased. Well, I learned today that this is just not the case; people are actually getting their hands on social insurance numbers with false identification.

Now, I've asked this question many times, and I'm going to ask it again today. We met with privacy commissioners last week, I believe. Mr. Crête just asked if more inspectors would rectify the situation, but I think we have to get to the base of the problem, to where the abuse is coming from.

I heard the banking association talk about asking for social insurance numbers when, at the beginning, the social insurance number was for government purposes only. I don't think we're tough enough on that. I don't think a bank.... Or even asking to get a movie—that's ridiculous; I just learned that today.

First of all, if we're going to create a new system or fix this one, I think one of the solutions will be to define the use of the number, the identifier. So that is one question. I'd like to know what you think of it.

As well, I think the education aspect is very good. I'm going to turn to Revenue Canada here, it being so close to tax time right now. Has Revenue Canada thought of sending, in their mail-outs to Canadians, an insert on what they should do in terms of how they should use their social insurance number?

Ms. Kathy Turner: We haven't specifically thought of sending out something to Canadians to remind them or inform them or educate them in terms of what their social insurance number should and should not be used for, but in our work with Human Resources Development we can look at that. If it's something the government thinks is a good idea, Revenue Canada is certainly an organization that is in touch with most people at least once a year.

• 1650

Mr. Jean Dubé: I know.

The Chair: Ms. Routledge.

Ms. Linda Routledge: May I respond on defining the use and education aspects?

First, I want to re-emphasize that the banks use the social insurance number for very limited purposes. One is where we're required to use it by the Income Tax Act. The other is with credit bureaus. We like to use it as a unique identifier.

On the application forms for that, most of the banks have a disclaimer that says that use in that way is optional. I recognize that some of the members said that was not the case in the late 1980s. It is true this was not an issue in the late 1980s. It became an issue early in this decade, and is something we recognized. That is what was put in our most recent copy of our privacy code. In the 1980s that wasn't an issue; our 1986 code didn't have it. Our current code has it because we realized it was an issue with our customers and responded to those concerns when it was raised with us.

It's clearly in the CBA code now, and as the banks are changing their forms and so on, more and more of them are putting in “The use of the social insurance number for this purpose with the credit bureau is optional”. If members would like copies of application forms that show that, we can certainly undertake to provide them to you.

It is part of the education to say up front on the application form that this is optional. We explain that it's a better way and we want to make sure their credit bureau records are accurate. We explain that transparency or disclosure. Customer consent means the customer has control. If the customer does not want to give the social insurance number for that purpose, the loan will not be denied strictly on that basis. We will use something else. It may take a little longer and be a little more costly, but we will go ahead without the SIN. So the customer has full control over how the bank uses that SIN.

Mr. Jean Dubé: But the use of the social insurance number is for tax purposes, I believe.

Ms. Linda Routledge: It's one of the uses.

Mr. Jean Dubé: The social insurance number was put in place for government services at the very beginning. Now you're telling me today you are sharing this social insurance number with the credit bureau. What you're doing is opening the window of opportunity for fraud.

Ms. Linda Routledge: There is nothing in the law that says that number cannot be used for that. If the way the bank obtains the social insurance number is related to the income tax, the law says we cannot use it for another purpose without the customer's written consent. So if the bank is using it for another purpose when it's collecting it for income tax purposes, they will get the customer's written consent to use it. In fact, in every respect the bank gets the customer's written consent to use it.

Mr. Jean Dubé: So you see what I'm getting at. It certainly opens that window. I know it's optional to the client, but you know you're creating an opportunity for crime and fraud by offering that number to the credit bureau. From there it's out of your hands. As a bank, do you not think it would be wise to protect the client from this possible fraud?

Ms. Linda Routledge: I don't understand how we're opening it to fraud by giving it to the credit bureau.

The Chair: I believe Mr. Rudderham has something to add to this discussion.

Mr. Jean Dubé: Who's Mr. Rudderham?

The Chair: Mr. Rudderham is vice-president of business services with the Bank of Montreal.

Ms. Linda Routledge: Unfortunately, there wasn't room for him at the table when we started.

• 1655

Mr. Richard Rudderham (Vice-President, Business Services, Bank of Montreal; Canadian Bankers Association): I think by using the number in the credit bureau, what we're trying to do is prevent fraud, as opposed to contribute to fraud. What you have in these cases is that you can have customers who can go from bank to bank, and if they default on a loan at the Royal Bank, if we don't have that common identification number it's harder to track back to that customer.

Mr. Larry McCormick: [Inaudible—Editor].

Mr. Richard Rudderham: It's in the absence. The banks don't have a common number they can use to identify where the frauds are coming from. If instead of the social insurance number there were a universal common identification number that could be used, that would be fine. I just wanted to respond that we're trying to prevent fraud with the use of the SIN at the credit bureaus.

Mr. Jean Dubé: First of all, the use of the social insurance number, the purpose at the very beginning, is for government purposes.

Ms. Linda Routledge: We acknowledge that.

Mr. Richard Rudderham: We acknowledge that.

Mr. Jean Dubé: All right, so now you're using it for other things?

Mr. Richard Rudderham: We're using it for credit bureaus, with the consent of the customer at the time of the application.

Mr. Jean Dubé: But it's not for government purposes.

[Translation]

The Chair: Ms. Vallée, do you have anything to add?

Ms. Marie Vallée: As was pointed out, the problem is exactly that, over time, the social insurance number has become a de facto means of identification. I don't know if the government will have the courage to go so far as to say that the social insurance number should be used for government purposes only and should never, under any consideration, be used as an identifier, say, for the credit bureau, for example. We'll see what happens.

That said, I think we'll have problems with political pressure because as the representative of the Bank of Montreal has just explained, they'll want to make sure that someone isn't a bad credit risk and investigate that person. The key to doing that is the social insurance number. It's not the name of the person or the person's identity but that person's number.

The Chair: Mr. Péladeau.

Mr. Pierrôt Péladeau: I'd just like to add a point. The credit bureaus don't have only banks as clients; there are all kinds of small merchants, owners of rental buildings, lawyers and so forth. There are all kinds of people using them. So everyone started using the social insurance number. So in some cases that were presented, people have been refused rental accommodations because they didn't want to give their social insurance number for the credit check even though it's not required by the legislation and the owner doesn't have that right. So the system has just snowballed and everyone is using it.

The point that I'll be making a bit later is that in the area of social insurance, there are problems other than fraud. You'd like me to address that now? Yes? Fine.

There's the fundamental matter of the confidence citizens have in their institutions, whether public or private. I'll give you a concrete example. For example, why doesn't the Advisory Council on the Health Infostructure ask for a universal identifer and even for Chinese walls between the private and public sectors, Chinese walls between health and, for example, the social insurance number? That's why people are showing distrust.

I'll give you another concrete example. I could give you a whole series. I'm part of the team supervising an experiment in pharmacology. We collect information from all the pharmacies concerning a single patient to find problem pharmacological interactions. The objective is to considerably reduce the number of hospital cases and deaths. During this experience, we faced strong resistance from the clients even though the experiment was conducted using a very strict guideline.

Why is there so much resistance? People told us that for an experiment like that, the information had to go through the Régie de l'assurance-maladie du Québec and that they didn't want the government to have access to their file. I know that people are very afraid that the State might have access to that information. Moreover, people know and this has been widely broadcast in Quebec—that the Quebec Department of Revenue has given itself the power to go and get information, including information in your health file. And who is the manager of the link between the social insurance number and the health insurance number? The very same Régie de l'assurance-maladie du Québec.

So even though the experiment showed that hospitalization was decreased by 30 p. 100 and that the death rate decreased, people didn't want us to carry on with it because there's a lack of trust.

• 1700

That's why we have to make sure that the Advisory Council's report says no to a single identifier because public trust is essential to maintain the population's health. It's essential that they trust their health institutions. So we have to separate the Quebec health insurance number from the social insurance number. Those are the stakes.

There's a lot of talk about fraud and false identities but there's also the fundamental matter of trust in the institution, trust in the banks, trust in public institutions and in the health system. This is fundamental because people have been sending the very clear signal that they do not have trust. I could give you many more examples.

I'd like to conclude... [Editor's Note: Technical difficulties]

[English]

The Chair: Mr. McCormick, followed by Mr. Wilfert.

Mr. Larry McCormick: Thank you very much, presenters, for your very interesting presentations. Of course we could be around here for days.

I think most of us realize that big brother is alive and well and seems to be in all corners of our lives. And that's a fact of life. It's often for our own good more than we realize. I sure wish Mr. Cleghorn and Mr. Barrett were here. They've been here when I've given them such a hard time, but now I'm going to give them an opportunity. I do acknowledge that a lot of good comes from our banks.

On these SIN numbers, we hear about people in the cities mainly. I represent a very rural area. But there are people who need to receive moneys or services from municipal, provincial, or federal programs, and they cannot receive money because they don't have an address. They don't have to be homeless; they don't have to be living on the streets of Toronto. I'm not talking about the people living on the grates, but there are people who fall between the cracks.

I just wonder if this would be an opportunity to use a SIN number for the right reasons. If these people had a SIN number, would that not help them be able to receive moneys or programs? Even more so for the bank people and the CBA, who are doing a great job of helping educate people on many other subjects about small business.... And I appreciate your good work.

I also hear in my riding from people who get and receive money from a source. Maybe a friend lends them money. I did it for many years in small business. Yet they can't cash a cheque. These people need the money badly; they need it tomorrow. They might need it for the right reasons—to buy medication or something for their children. These people don't all have bank accounts. I think this is an opportunity where banks could help society. We know there will always be abuse of SIN numbers, but surely a SIN number means something in this country. I'm just wondering why the banks haven't offered to make more use of the SIN number.

For example, the banks built their wealth on the natural resources of this country. And I'll tell you, right about now they haven't given up on mergers, and I don't want them to. A lot of good can come out of this. But when they turn their backs on rural Canada, after they made their billions of dollars—

The Chair: Mr. McCormick, with due respect—

Mr. Larry McCormick: Madam Chair, this is directly on the topic, because the banks.... Then somebody says “We can't help these people because they don't have all these forms lined up”. Yet the people are only trying to cash a cheque. I would challenge some people here from the banks to try to enter those lives and find out what it means for people who need money and don't have it, and try to cash a cheque in one of your branches. I've been there. I've gone there with them. I've talked to the managers to try to help them get the money. I think it's an opportunity for you.

The Chair: The comment, if there's anyone who wants to reply in like.... Or is there a question in there?

Mr. Larry McCormick: Linda does a great job for the CBA.

Ms. Linda Routledge: I would like to address that because it is an issue I've spent the last two years working on quite hard. The banks have recognized that cashing cheques and opening accounts is a problem for low-income people. In February 1997 the banks established some new policies to assist low-income people. Part of it involved reducing the requirement for identification when opening accounts from three pieces to two pieces. Part of that involved accepting a personal reference of someone known to the branch, whether from a social service agency, a branch customer, or even a branch staff person. That would be one hard piece of identification, plus the reference. Part of it was saying that no minimum deposit is required to open an account. Another part was that no employment is required. They've tried to do a lot in terms of reducing those requirements so that it is easier for people to cash a cheque.

• 1705

However, part of this is also that some of the pieces of identification that are acceptable, credible, and have good integrity to them are not pieces of identification that low-income people have or have access to. A driver's licence is expensive. A passport is expensive. What we've asked the federal government to do—in fact the MacKay task force reinforced this—is to issue some identification. I'm not talking about a compulsory national identification card. I'm just saying that if someone needs it, they should be able to apply for it. We're hoping the federal government will do something along those lines to assist.

Mr. Larry McCormick: I appreciate both that and your efforts very much. I shudder when you were talking about bringing the federal government into it, though. I've only been here five and a half years. I find out more every day about how slowly we react, so I'm not sure how we can help these people any more than you can help them. You're there on the front lines.

I must admit that in rural Canada the managers will quite often put their own hide on the line to help these people.

Ms. Linda Routledge: They know the people.

Mr. Larry McCormick: They know the people, but—

Ms. Linda Routledge: They can give the personal reference. In many cases in rural communities, it's very easy because everyone knows each other. It should be very easy to provide the identification necessary in those cases. What you need, though, is good identification. Ideally, it's something that has a photograph and a signature, because that gives you better proof that the person standing before you is really the person the identification belongs to. I say that recognizing that it certainly is easy to get fraudulent identification, as Sergeant Gareau has told us.

Mr. Larry McCormick: Just as a closing comment to Mr. Rudderham, Madam Chair, I do think there is a real opportunity for our banks and our governments to work together for people in all parts and facets of society in Canada. With a few dollars invested into whatever arm the banks are willing and wanting to give us, I do believe we can extend for micro-loans and all that. I don't want to see all employees of the bank swallowed up by Mr. Barrett's comments, such as when he jostled us and said it had to happen and it had to happen now for the future of this country.

Our banks are our most valuable asset in rural Canada, and I look forward to working with you. I just want to see our banks also try to assist all people, not just the ones they make money for. I know Linda has done a great job on that.

I thank you, Madam Chair. I'll pass my time along.

The Chair: Thank you very much.

Mr. Wilfert, you have the last set of questions.

Mr. Bryon Wilfert (Oak Ridges, Lib.): Over the last few weeks we've clearly established that we've come a long way since 1964 in terms of the purpose and the use of the SIN. We've established over the last few weeks that people generally have a lack of confidence in the SIN and its uses. In fact, because of the nature of computers, you can use the SIN from one database to another to get information.

On Mr. Dubé's comments, I certainly understand where he's coming from. Clearly, whether the customer agrees or not, the fact is that there are other uses for the SIN than were originally intended.

The system is in a situation in which we interpret it as an administrative problem because of duplication, inaccuracies, etc. Or, as we've talked about, we need to start over again with an entirely new system. I think maybe some of us have been looking for a magic solution. Clearly, the more people who come to this committee, the less likelihood there is to get a magic solution.

It really comes down to what I said last week: there needs to be the political will to do something. We're trying to balance privacy issues on one hand and efficiency on the other, given the issues and concerns around fraud. We want to get at these people who commit the crime. On the other hand, how much information does one need as a government to ensure there is some kind of effective system to try to prevent that?

• 1710

Clearly, the question we've been grappling with and trying to get an answer to.... We may be beyond plugging the holes—there may be more holes than there is cheese. Therefore you're out of luck there. If we go for a new system, people talk about the inordinate cost. I would also be interested to see how other states have dealt with this type of issue. If it comes down to cost, maybe we have to look at the fact....

We talk about the chip and everything else, but I think in the short term, yes, an education campaign—probably through Revenue Canada, since everybody gets their income tax.... I try to get off their mailing list. I gave at the office, but they still want me to give.

The problem is we've got to get that information to Canadians. On the other hand, I'm not sure that really will fix it in the short term, because you have all these other uses that are already out there—the banks and everyone else, who are using it for other purposes. And whether they're okay or not, the fact is we're becoming, with the amount of data surveillance that's going on in Canada....

I phoned up one pizza place and they suddenly told me what I wanted. I hadn't ordered yet. They said “Oh, you always order this”. Well, you know, that's.... You can imagine where this goes. Luckily, I'm very consistent in my pizza taste, because it's still the same pizza. On the other hand, I have this great internal struggle trying to deal with that issue.

So how we are able, in the short term.... It's not simply government, it's the private sector too. I personally think it's time we looked at a whole new system. I would be interested in any comments as to whether it is simply an administrative problem that can be fixed, or whether if we start to build a new system.... I would like to get people in here to talk about costs and time lines. We have been talking about this for eons, and the problem is we really don't seem to be much further ahead than we were. Yet everyone who comes in here keeps saying we have a problem, but where do we go from here?

Ms. Kathy Turner: I think the administrative problem we face today has to be fixed, whatever decision is made. I think in the short term, we collectively—Treasury Board, Human Resources Development, ourselves at Revenue Canada, and many of the people who have come to talk to this committee—all recognize those problems have to be addressed and fixed, no matter what the government decides to do.

The Chair: That's a very helpful comment, and a very encouraging one.

Ms. Kathy Turner: We will be doing that. But in the longer term, yes, it is a bigger issue: privacy versus efficiency. I guess that is not something Revenue Canada can by itself address, but with our colleagues we could certainly encourage the government toward looking at a decision on this.

Mr. Bryon Wilfert: Are we looking at a national round table on SIN where we bring in all of the key stakeholders? We should lock them up in a room and not let them out until we come up with a solution to the problem—or at least give us something to maybe start on the path.

I'm not being facetious, but maybe we need some kind of national round table to at least say okay, we have at least seven federal government departments involved with SIN, never mind the provinces and the difficulties we have there, such as when people die we don't get the information until whenever. We have people who have pets who have SIN numbers, and all those wonderful things. So maybe it's time we had some kind of national mechanism to bring those people to the table. I don't know.

Ms. Kathy Turner: Well, I think we are going to see, particularly through the lead that HRD is taking on these working groups—they are involving all the affected federal departments—that these are the types of issues we'll be looking at. But the issue goes beyond those federal departments.

[Translation]

Ms. Marie Vallée: If we want to go further and have a broader debate, I also think that we have to establish the program you're talking about. If we want to see things more clearly, we have to define what our real needs are. Otherwise, we'll only come up with partial, lame solutions. I think that's a very important aspect; what are our needs in the area of identification and what ends is it to serve? Then we could look at the solutions.

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In the meanwhile, we have to stop the haemorrhage. Anyway, that's how I look at it, seen from the outside, at least. Of course, we are not parties to this debate which is left to the bureaucrats. I hope they'll do good work, that we'll let them get along with their work. We'll see what solutions they come up with. I think they're in a bit of a rush because they're feeling the pressure. That's good.

Meantime, if the committee recommends that Parliament should act, we'll have to act a bit more consistently and determine what the needs are. What are the needs of private enterprise, the needs of governments, the needs of provincial governments and what are the fundamental rights of our citizens? Then, it will be possible to come up with solutions and evaluate the costs. We'll be able to look at what is being done elsewhere. After all, things have been done, some of them worse, some of them better. At that point, we'll be able to have a better idea of the whole thing.

The Chair: Thank you.

[English]

I see that Mr. O'Reilly has a few quick questions. Obviously your comments are provoking a great number of questions.

Mr. O'Reilly.

Mr. John O'Reilly (Haliburton—Victoria—Brock, Lib.): Thank you, Madam Chair.

First of all, I thank the witnesses for coming. I think I've learned a little bit today. And I want to tell you I'm not a bank basher and I don't have a problem with giving my ID to the bank. I don't care if they want to fingerprint me. It really doesn't matter, because I'd like not to be involved in the fraudulent part of people using your name for other purposes. It's only when the bank turns that information over to another agency that I have a problem. But it's not the SIN necessarily that would bother me. It would be the other personal information.

Now banks have a policy of not even giving me all my personal information. But there's no hesitation to turn that file over to another agency. I'm not saying in my case, but in a case where you're trying to collect, and you turn it over to a credit bureau. So I have a problem with that. But then you have to be able to identify the person you're trying to collect from. And if you go to—I think it's page 21 of your Canadian Bankers Association paper—there's a question there that indicates under what circumstances I can't have the information that's on file at the bank. It's not a big problem. It's just why, if I can't have it, does it go somewhere else?

I was looking for some type of system that doesn't discriminate by province. For instance, if I'm an electrician I can't work in the province of Quebec if I have an Ontario identification number, and probably vice versa in some cases and certain trades. So maybe the provincial identification system is not one that would work. If you were from Quebec and you went to B.C., or if you were in B.C. and you went to Quebec, you may have a problem of discrimination by province. I'm not saying that happens, but I think it does.

So is there more than one way to have a personal identifier? Because a personal identifier is necessary. You only have to open up a phone book under the name Lee or Smith or Johnson to see that we all have to be personally identified when there are many common names.

What would you, as individuals, tell us you would like to see replace the present SIN if that's the case?

The Chair: Ms. Routledge, would you like to attempt a response?

Ms. Linda Routledge: Sure. We're talking about the current social insurance number uses?

Mr. John O'Reilly: Yes.

Ms. Linda Routledge: I'm not sure I can offer particular comments on that. I know what we would like for identification is something that has some kind of personal identification to it, like a photograph or a signature. Those are things that are uniquely associated with an individual. And maybe that can apply to the social insurance card, so there's something there that is more uniquely associated with the person than a number, which obviously has no relationship to the individual.

There's all sorts of technology going on now where biometrics that can be used in association with the card are being considered, which would help reduce the fraud that's associated currently with the social insurance number.

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Mr. John O'Reilly: Perhaps the RCMP officer could answer as to how far he would want to go with the personal identifier to make sure you eliminate as much fraud as you can, because you can't eliminate it all.

S/Sgt Victor Gareau: As I said before, the fraudulent activity in this country is rather low when we compare it with the overall business that goes on in the country, especially in the public sector. As I mentioned before, we don't want to create a police state, and as you well know, the fingerprints are used for the proper identification of criminals only. I strongly believe that it should be left that way.

As madame has just suggested, to have a photograph and to have a signature on a card would certainly be helpful whenever we have any dealings with people in the police community anyway who are involved in any criminal activities. We would like to see more than what is on the actual SIN card at the moment.

The Chair: Thank you very much.

I would like to thank all of our guests for coming and adding to our knowledge and our insights. As you can see, I don't think we've even gone through the number of questions we have for you, so I would like to reserve the right to write to you and add to our knowledge base for our report. Thank you all for your patience. Thank you all for coming.

We have just one housekeeping matter to attend to as we liberate our guests. Brenda, I understand you're about to table a report.

Mrs. Brenda Chamberlain (Guelph—Wellington, Lib.): I would like to table the report on behalf of the chair, Carolyn Bennett, and they have a recommendation. Would you like me to read the recommendation, Madam Chair?

The Chair: Yes.

Mrs. Brenda Chamberlain: It's that the Subcommittee on the Status of Persons with Disabilities request from the Standing Committee on Human Resources Development and the Status of Persons with Disabilities an interim budget of $2,000 to reimburse the expenses of the out-of-town witnesses it proposes to hear in its second round table on new directions, policy options, and accountability.

(Motion agreed to)

The Chair: This meeting is adjourned. Thank you all.