NRGO Committee Meeting

STANDING COMMITTEE ON NATURAL RESOURCES AND GOVERNMENT OPERATIONS

COMITÉ PERMANENT DES RESSOURCES NATURELLES ET DES OPÉRATIONS GOUVERNEMENTALES

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, December 4, 1997

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[English]

The Chairman (Mr. Brent St. Denis (Algoma—Manitoulin, Lib.)): Good morning, colleagues. I'm pleased to open this December 4 meeting of the Standing Committee on Natural Resources and Government Operations. We're pleased to have with us today Mr. Mayne and Ms. Barrados from the Auditor General's Office. They have kindly agreed to give us an outline of chapters 5 and 11 of the recent Auditor General's report to the Parliament of Canada. Specifically, those chapters have to do with “Reporting Performance in the Expenditure Management System” and “Moving toward Managing for Results”.

You will recall that we had a presentation by Treasury Board officials last Thursday. On Tuesday, we had the public works and government services department explain to us how they handle the performance reporting system.

We're pleased to have a different perspective on that, and we welcome you to our meeting today. We ask that either of you or both of you spend 10 or 15 minutes outlining the issue of the day and allow time for members to ask questions.

Ms. Maria Barrados (Assistant Auditor General, Office of the Auditor General of Canada): Thank you very much, Mr. Chair. I would like to thank the members of your committee for this opportunity to come here today to talk about the two chapters from the 1997 report, chapter 5, “Reporting Performance in the Expenditure Management System” and chapter 11, “Moving toward Managing for Results”.

As you know, our office conducts independent audits and studies of government activities. The results of this work are reported to Parliament, thereby providing information to hold the government to account for its stewardship of public funds. The OAG will work with committees and their staff to help them understand and use these audit findings.

This morning I would like to briefly discuss performance reporting, as described in chapter 5; parallels with a report released at the end of the last Parliament by a committee studying the business of supply; and managing for results within departments, as presented in chapter 11.

We also have a brief handout to assist the committee.

[Translation]

Knowing how well programs and services are doing is increasingly essential to managing in today's public sector. Credible information on the results being achieved is needed to manage tax dollars better, to make better decisions, and to provide for better accountability.

Last week, your Committee received a presentation from Treasury Board officials on changes in the expenditure management system, in particular the Improved Reporting to Parliament Project and Fall Performance Reporting.

We undertook the audit reported in Chapter 5 to assess the progress departments are making in their reporting of expected and actual performance in the expenditure management system. In our handout, we summarize our criteria for good performance reporting.

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Mr. Chairman, this is an area we would be happy to discuss further, if the Committee so desires.

We support the government's efforts to improve performance reporting through better reporting results and improved scrutiny process and schedule.

The revised Estimates framework shows potential for a greater focus on results, the need for departments to make information available on what programs are intended to achieve and what they are actually accomplishing. These improvements need to be sustained.

The motion of the House put the new regime in place on a pilot basis for this year. As we point out in Chapter 5, there is a need to ensure that the improvements in the reporting regime are made a permanent part of the parliamentary business of supply. Other jurisdictions, for example, have turned legislation.

Good reporting will take some time to bring about. Our audit found progress by departments in describing their business.

However, there is a need to focus expectations more on final results and make them clearer and more concrete. Performance indicators are often not clearly explained. There is a need for more progress in reporting key accomplishments. Our audit found that it was not possible to judge the success of programs from the information reported.

Concerted efforts by departments and Treasury Board Secretariat are required. We made several recommendations to the Secretariat, for example, to strengthen its effort to document and communicate good practices among departments, and to make departments aware that the Secretariat is using their performance information in its decision making.

[English]

Departments have an obligation to provide Parliament with good reporting on performance. We encourage committees to strongly challenge departmental performance reports. If departments believe that committees want good information, they will be more likely to devote the effort needed to produce it, and parliamentarians in turn will be better served by that information.

Our handout also identifies some suggested questions that members of this committee can ask about the departmental performance reports in carrying out your scrutiny role. For example, where reports provide information only on activities, such as numbers of inspections, reports produced, and that kind of thing, you could pose the following questions. What were the results of these activities? What was accomplished?

The Standing Committee on Procedure and House Affairs released its report on the business of supply at the end of the last Parliament. The committee recommended new structures, tools, incentives, and approaches to improve the business of supply.

We particularly want to bring to your attention the committee's recommendations in the area of performance reporting. These recommendations are consistent with those in chapter 5 and are referred to in the Auditor General's chapter on matters of special importance, which is on pages 12 and 13 of the report that was tabled last Tuesday. Your committee, Mr. Chairman, with its responsibility for the oversight of central agencies may have the opportunity to pursue these recommendations on performance reporting.

Good performance reporting to Parliament will occur only if departments are developing and using this performance information themselves to manage and improve their programs. Thus, in chapter 11, we looked at several cases in departments where this was happening, where departments were managing for results.

Managing for results in government departments and agencies means making decisions based on what a program is achieving for Canadians. The chapter outlines a framework for managing for results. Mr. Chairman, we'd be prepared to discuss this framework further if the committee so wishes.

An important dimension is the willingness and ability to learn from facts and experience. Performance information needs to be actively used to improve program performance. One basis for scrutiny by parliamentary committees would be to draw attention to cases where departments do not appear to be making adjustments when performance has not been as good as expected. Another would be to compliment departments that have acknowledged shortcomings in their reporting and shown they have actively taken steps to correct matters.

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In summary, the changes in performance reporting and managing for results are major changes and ones that we support. Your committee's scrutiny of the departments assigned to you by the House gives you an opportunity to seek improvements in the quality and usefulness of reports on plans and performance.

Your committee is in a special position because the Treasury Board Secretariat and other central agencies are assigned to you. It is well placed to encourage the Treasury Board Secretariat to work with departments to make the improvements needed and to reinforce the progress made by seeking to make these changes permanent.

We would be happy to answer any questions, Mr. Chairman.

The Chairman: Thank you for that concise presentation.

Members, you should have copies of chapters 5 and 11 of the Auditor General's report of this year and some notes.

Mr. Williams, I believe you indicated you have some questions. I will start with you.

Mr. John Williams (St. Albert, Ref.): Thank you, Mr. Chairman.

Good morning, witnesses from the Auditor General's office. It's always nice to have people who are concerned about accountability. It certainly seems to be something that is becoming more and more aware...that government has a responsibility to deliver and be accountable for their performance in the delivery of programs.

Accountability for performance means both achievement of results and within a reasonable cost in doing so. To that end, I noticed other organizations...and your chapter specifically talks about Alberta, western Australia, and so on. But when we talk about accountability and performance management and performance reporting, where should it go from there to close the loophole and ensure that they are in fact held to account?

Ms. Maria Barrados: Mr. Chairman, I'm not sure I'm fully catching the question. I can try, and perhaps Mr. Williams—

The Chairman: Do you want to elaborate on that, John?

Mr. John Williams: Basically what I'm talking about is we have performance measurement; we have reporting on performance; we have a move towards managing for results. That's fine if the story is fine, but when they fall far short in their performance, now that we have the information at hand, where do we hold them accountable for their lack of performance? Now that we have the information, where do we go from there to hold them accountable?

The Chairman: Is that okay, Ms. Barrados?

Ms. Maria Barrados: Yes.

The first thing I think I should say is that in the performance reports themselves there is a need to be vigilant and to push for what we are calling balanced reporting. There is a tendency for departments to want to give the good news and not to give the news where it's not so good. So that's a very important part of this system, that there is real integrity in that reporting. Otherwise the reports will come forward and they won't actually reflect what's going on. That's the first thing that I think is very important.

But Mr. Williams directly raises the question, “Then what?” I think here is where there is an extremely important role for members of Parliament and committees to play in the scrutiny of these reports. The information is being put forward and here is an opportunity for members to scrutinize the reports, pose the questions, and make recommendations. A number of recommendations can be made. There can be recommendations for corrective actions. There can also be recommendations made that get put into the cycle of budget decision-making so that recommendations coming out of performance reports can go to the House and be part of the budget formulation process and then can come back again at the time of the estimates and then come back again in that cycle. So there's an opportunity with this to input into the entire decision-making system.

Mr. John Williams: Ms. Barrados, you mentioned that sometimes departments are loath to put in the information that demonstrates maybe a lack of achievement.

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Two issues come to mind. One is in the Auditor General's report tabled in October regarding NAV CAN and the privatization of NAV CAN. The Department of Transport had decided to do an interim report on their achievements followed by a final report after it was all said and done to analyse the benefits and problems, etc., in the process of the privatization of NAV CAN, but then decided we didn't need a final report.

The Auditor General was very critical of the privatization of NAV CAN and the way it was handled—not whether it should or shouldn't be done but the way it was handled—yet Transport Canada decided that a final report was not necessary and the witnesses said so quite emphatically in testimony. How do we get that information out when it is not complementary to the government's achievement?

The other example, Ms. Barrados, is TAGS. The Auditor General wrote three full chapters on the TAGS program in a recent report. We took a look at the Department of Fisheries' improved reporting to Parliament—and I underline improved reporting, Mr. Chairman—where there were only three lines regarding TAGS in the fisheries improved reporting and two half pages in the HRD report, which was managing the entire program.

We know TAGS has a very serious issue to deal with in Atlantic Canada and is trying in some ways to do so. Then you read in the report where it says that after August 31, 1996, that particular aspect of the program was no longer available. Reading between the lines and through further research, we found it was because funding was no longer available, but that didn't say so. We are having a real problem with ensuring that departments are bringing forth the less creditworthy information. How do we get that, Ms. Barrados?

Ms. Maria Barrados: It's not a simple question and it doesn't have a simple answer, because we are asking for a major change in how things are being done. My office is very committed to this change, as is the government. We are doing what we can in terms of looking at these reports in our audit work with departments, looking at them to ensure they have integrity. We make reports, as Mr. Williams referred to, when we see shortcomings.

In addition to that, we are suggesting that committees become actively involved in looking at these reports and choose their options to report themselves. Committees themselves can make reports if there are problems or if, upon scrutinizing the performance reports, there isn't sufficient information.

Having said that, I think we should be realistic; these changes are fairly new and it will take a bit of time to get them all implemented. The important part of this is that for bureaucrats coming forward, they have to be able to present the bad news as well as the good news without feeling it will be used in a destructive manner.

What I'm trying to say here, Mr. Chairman, is that it should be possible to bring forward instances of where there has not been the success that was desired and it is clearly reported and the conversation is a conversation of how to make it better, how to make the changes. There are many programs in government that are very complicated, that don't lend themselves to quick and easy fixes. We are suggesting that there is an opportunity for both the government and members of Parliament to improve that dialogue around these performance reports.

The Chairman: Is that okay for now, Mr. Williams?

Mr. John Williams: Yes, thank you.

The Chairman: We can come back if you'd like.

I have Roy Cullen next.

Mr. Roy Cullen (Etobicoke North, Lib.): Thank you, Mr. Chairman. Thank you, Ms. Barrados.

I applaud efforts to improve performance management reporting within government, but I have a little bone to pick. It's somewhat off topic, but I think it's sort of on topic in a sense.

I'm a CA. I have a lot of empathy with the kind of work you're trying to do. Auditors general typically have expanded the mandate. It started out with financial and accounting and reporting and then it moved into management audit. The area I'm a little concerned about is that the Auditor General seems to be getting into areas of what I see as public policy.

Yes, it seems totally appropriate that the Auditor General would recommend and monitor the fact that departments need performance management systems and other systems there. Are they good systems? Are they reporting against results? Is that good information? That's totally legitimate. When I see the Auditor General talk about...an example that struck me recently was the TAGS program. It's totally legitimate to say there may be issues around value for money or financial accountability.

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Perhaps this wasn't a suggestion of the Auditor General, but it seems to me that to suggest that this program did not have a very good public policy intent is getting into the area of public policy...forgetting politics. Yet a number of people were in a desperate situation. So taking those things out of context, I don't think you can have it both ways.

If you're looking at fisheries policy, for example, in this group that is looking at sustainable development, which I think is totally appropriate.... I saw some remarks by the Auditor General the other day. He was talking about coho stocks, sockeye stocks, and chinook stocks of salmon, and he was making some comments about fisheries policy.

That troubles me, because, frankly, notwithstanding all his best qualifications and intents, I'm not sure the Auditor General should be qualified to speak on fisheries policy. In my view he can speak out on whether or not there is a good sustainable development strategy? Is it being implemented? Is there a good loop back in terms of monitoring results?

Perhaps you could clarify this fine line. I've been an auditor and I've been involved in management auditing, and it seems to me we keep stretching the envelope. I would like you to comment on that.

Ms. Maria Barrados: Mr. Chairman, we're very sensitive to staying well within the bounds of our legislation. The legislation does ask us to look at management, expenditures, systems, and practices in government to see whether they're done efficiently, whether money is used with economy, and whether there's appropriate systems to measure their effectiveness? So that's what our legislation asks us to do, and we try to do that.

We are sensitive about the policy issue. Our reports are very carefully scrutinized to make sure we stay on the right side of that issue. So you will see that the reports themselves talk very frequently about the systems and practices. We do try to talk about the results that are achieved with those systems and practices so that it has some meaning, so the consequences are clear. We try very hard not to involve ourselves in the policy discussion and the policy debate.

Having said that, there are instances in which our reports are used and where reports are made that may give a contrary impression. We do strive very hard not to do as you suggest.

Mr. Roy Cullen: I have the volumes of the Auditor General's report in my office. Once we get through some greenhouse gases and we get the postal workers back to work I'm going to be studying it. I just wanted to flag that I think it's not black and white; it's grey. Some things I've read recently suggest to me that we're getting into the areas of public policy, and that's for politicians and that's for bureaucrats, and I would just like you to be sensitized to that.

Perhaps I'll leave it at that for this round.

The Chairman: Okay. Thank you, Mr. Cullen.

[Translation]

Ms. Girard-Bujold.

Ms. Jocelyne Girard-Bujold (Jonquière, BQ): Good morning, Madam.

Ms. Maria Barrados: Good morning.

Ms. Jocelyne Girard-Bujold: I am happy to meet you.

As far as I'm concerned, I can see that while no one can be against virtue, it is still regrettable though that there are so few concrete examples of management for results. Thus, a concept does not have to be trendy in the federal context to make it become a reality.

You are telling us that Chapter 23 outlines a management for results framework that you would be ready to discuss further if the Committee so desires. Then I would be quite happy to discuss it with you if you could elaborate a little bit more about that.

[English]

Ms. Maria Barrados: Mr. Chairman, chapter 11 outlines the framework that the member referred to. I would just briefly like to run through the items that we felt were important when we looked at the management literature and we looked at the instances where we identified good practice. So we have in this case examples in government where we felt there were elements of managing for results that illustrated that it could be done, and there were some really interesting success stories associated with that.

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We tried to articulate these elements of that framework. I'll just highlight them. The first is that it's very important that the whole organization is oriented towards doing this so that there is a focus on what results are to be achieved and that everyone is focusing on the result and not worrying entirely about the specific activities or the mechanics of doing these things. We never advocate that processes aren't important, but it's always important to have this look at what you are trying to achieve.

The next thing that's very important is an agreement on what you're trying to achieve. The example we cite here is about migratory birds. This involved partnerships, many different jurisdictions, and very many different players. It was successful because there was an agreement on what they were trying to accomplish, on what they were trying to do with increasing wetlands and the impact this would have on the increasing number of migratory birds.

Next, there has to be an agreement to measure the results so that when you've set out what you're trying to do you know whether you're getting there or not, and so that if you're not getting there you know how to make appropriate adjustments. This is difficult to do, because the attention has to be given to measurement, and then the attention has to be given to living by those measures, with good results or bad results. If you have good results you can celebrate, but if you have bad results you're going to have to make corrections and make these improvements, because you're oriented towards that result.

Lastly, there must be an effective reporting regime. If I may, I will just add an additional comment. With respect to this framework, laying out a framework is something that we would like to see managers in government do more of. It has a natural link, then, to the performance reporting that we expect to see coming to Parliament.

The Chairman: Mr. Wood, then back to Mr. Williams.

Mr. Bob Wood (Nipissing, Lib.): Thanks a lot, Mr. Chairman.

One of the main points you've stressed is the need for more results-based management of government departments, Madam Barrados. We've all seen first-hand, I think, the difficulties managers have in obtaining results. First of all, they have to comply with elaborate regulations. They have to report their actions up the bureaucratic chain before anything can be done. Then they are rewarded not for achieving success but for complying with the system. Clearly this bureaucratic culture is inefficient, it's cumbersome, and it's not very results oriented.

The alternative, I believe, is to create the environment where local and regional managers have the confidence and motivation to take decisive actions and to achieve a successful service delivery. While this would be great, it also opens the door to questionable business practices, such as partisan contracting and single-bid contracting. I suspect that the overregulation that now exists is in part due to attempts to ensure proper business ethics are followed.

If we ask decision-makers to take more initiative to produce results, is there the ability to monitor their actions to ensure they are complying with government standards, given the cutbacks to internal auditing departments? Are there enough people to monitor departmental activities? Or does it fall solely on the Auditor General to find the errors?

Ms. Maria Barrados: Mr. Chairman, that's a very important question. I think we are on a path of changing how government does its work and how we expect government to manage itself. I think we all agree—those of us who sit outside government and those in government—it's the right thing to do, it's the right way to go.

But this does then pose these questions that are raised by the member. An important part of managing for the results, whether it's in service or contracting, is that there is a true commitment to accountability. There has to be transparency and there has to be accountability.

That means there is that agreement as to what is achieved in a program delivery, or if it's a service, that there is a posting of what kind of service standards are in place and what is expected to be delivered, that there is measurement and that this is reported. There must be transparent and honest reporting on what is going on. That's a fundamental part of this.

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I would have to add as well that a number of us are preoccupied with maintaining the ethics and values in public service. That is also a very important part of this. We can't continue to do it by systems and procedures, but we do have to be concerned that ethics and values are maintained in the public service.

Yes, we do have to continue to have monitoring. I don't think we can rely on monitoring to avoid all the problems. I think the reliance has to be on the managers and their integrity. I do think there is a strong role for internal audit and systems within government. I don't think the reliance should be on the external auditor. We play our role and we do what we can. Government is very large. I think government has to put its own act together and work well.

Mr. Bob Wood: Just one more question on chapter 5. Your report stated that the need of parliamentary standing committees is to take a lead roll in studying the performance of specific departments. It also stated, however, that a review of the committee hearings showed that the discussion of performance information had increased only minimally.

From my personal experience—your study agrees—the reason why this happens is really because the volume of material that MPs receive on these issues is too great to make an in-depth study practical. Reading main estimates and performance reports is a difficult and time-consuming task. Often, we have to rely on summary information received only hours before a meeting as the basis for our understanding of a document.

Frankly, I'm not sure there's a solution to this problem. If there is, I'd like to know more about what your thoughts are on this issue.

Ms. Maria Barrados: Mr. Chairman, we have been arguing very strongly and strenuously to reduce the volume of the reports. Those performance reports should be much more of a summary and much easier to read. They should use graphics and be clear. We have seen a reduction in volume.

The other part of this that I think is important is that committees should have the opportunity with those reports to call witnesses and have inquiries on the reports. It doesn't have to be done by reading the reports and doing this outside the committee, but these are part of the estimates. So as part of the estimates process, there is the opportunity to have the discussion and dialogue on those reports themselves.

I realize as well that these reports are relatively new. Some of them are quite good. We have some good examples in here. Some of them leave a lot of room for improvement. I'm sure it would be very frustrating for members to want to scrutinize the performance of a department and be dealing with a report that's difficult to understand and figure out what it is they're doing to really see if there has been any success. We're asking committees to have a little bit of patience with this and help make this process better. If committees really have an interest and ask the questions, officials will respond.

Mr. Bob Wood: Thank you.

The Chairman: Thank you, Mr. Wood.

Mr. Williams, then Mr. Serré.

Mr. John Williams: I appreciate the opportunity to address the witnesses again.

Ms. Barrados, program evaluation is something that the Auditor General has commented on at various times in the past. It seems to have had a bit of a chequered career, or birth, shall we say, in getting up and running as an effective tool of management, evaluation, and reporting. Where is program evaluation and where should it be going?

Ms. Maria Barrados: Mr. Chairman, at various times we have done audits of program evaluation, and we will continue to do those kinds of audits to assess where exactly it's going.

Program evaluation has now been merged into a review function, so it has less visibility, perhaps, than it might have had in the past, but as part of the president's report, which was tabled with the performance reports, there is a listing of the reviews that are carried out by government. So this gives an indication of some of the activity going on there.

We continue to worry that this function maintains its strength because it is an important part of providing information on the effectiveness of programs. It's a role for government to do that.

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In these performance reports we would expect to see references to evaluations and the results of evaluations, because meaningful results on programs—we often talk about outcomes of those larger benefits for Canadians—can really only be dealt with through evaluation. They may appear as one number, they may appear as one reference, in a performance report, but to make these statements with any confidence...evaluations have to be behind them. It's a very important part of the performance story in government.

Mr. John Williams: I'm concerned that, as Mr. Wood pointed out, we seem to get too hung up on process, that the i's be dotted, the t's be crossed, that it go out for public tender, and so on, but what is the final objective of a particular program? Is it actually going to provide a benefit in relationship to values, money spent, in society? I think back to the time—it's now a few years—since the Auditor General reported on the Atlantic freight rate assistance program, which was created in 1920, if I recall and first evaluated in 1990, and in the words of the assistant deputy minister, it provided zero economic benefit to the community, although it was costing us $100 million a year. How far advanced are we in being able to do this evaluation of the benefits to society of the program, to quantify that? Does it need more enhancement?

Ms. Maria Barrados: The last time we looked at the program evaluation function, which was about a year ago, we found there had been some small improvement on the large programs, but still, the coverage is selective. This is another area where the choices do have to be made.

A lot of major programs are not evaluated. The question being asked, what the real contribution of these programs is, isn't being addressed. It's an important part of examining performance and asking those questions about what has really been accomplished with large expenditures; not only the expenditure programs but, as Mr. Williams well knows, the statutory programs.

Mr. John Williams: Therefore you feel it would be beneficial to have an ongoing or periodic evaluation of these large programs, and it can be done; it is possible to evaluate these large programs such as CPP or UI or the seniors' benefit once every 10 years, and you feel that would be beneficial.

Ms. Maria Barrados: It definitely is possible to evaluate these large programs, and as an office we strongly feel it's important to do this on a cyclical basis. I'm not so sure I would want to put a period on it, because I think this will depend a little on the needs of Parliament and government. A lot can happen in 10 years, and that may be a long time. A lot of money can be spent in 10 years.

Mr. John Williams: Therefore it would be according to the complexity or the size, but the concept of a periodic evaluation, you feel, is definitely beneficial to Parliament by giving it information to understand and evaluate the benefits of programs and to ensure Canadians are getting value for their money because we're not ripping away on something that's really not providing a benefit.

Ms. Maria Barrados: Yes, absolutely. It's the only way the information can come out.

The performance side is not like the financial side, where you have a bottom line. It's not the same kind of bottom line. So the only way...the value you get out of these programs, the benefits you can get out of these programs, is through this analytic route. It's not as clear-cut, it's often complicated, but it's the only way you can deal with this question of whether a value is being achieved from the program in place, quite apart from the question of whether this is good policy or good politics.

The Chairman: Mr. Serré, please.

Mr. Benoît Serré (Timiskaming—Cochrane, Lib.): Thank you very much, Mr. Chairman.

First of all, I would like to comment on Mr. Cullen's concern. I share his concerns. I believe setting out public policy is a matter for elected officials. Developing aims and objectives and different programs should be done by government and elected officials. The role of the Auditor General is to report on whether those aims and objectives have been achieved in the most cost-efficient manner.

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I know there's a fine line there, but I get a little nervous because I hear comments that basically do not reflect if the aims and objectives have been achieved, but say this is good or bad public policy. I think that's the role of the opposition. If it's bad they'll tell us and the Canadian people will tell us. So I'm a little concerned there and I have a little problem with that.

The questions I wanted to ask are in the same line as Bob and Mr. Williams'. Specifically, Bob, you asked the question I wanted to ask, but maybe I can expand a little bit.

The main thrust of your report is that there's been some improvement in the reporting of performance, but we're not there yet. There's still a lot of improvement to be done, and you make many suggestions, one of which is to challenge committees to be more proactive and to ask for more. But I share Bob's concern. We get those reports sometimes hours before, and quite frankly, and in fairness to members of Parliament, we don't have the expertise that auditors like yourself have. We can't, in an hour meeting, study and understand what the report is all about and be in a position to challenge the reporting.

The problem I have is that each department reports from the inside. I can hardly see somebody coming before a committee and saying, we've screwed up, we haven't done a good job. Everybody will try to protect their turf and to give you a bright picture of their department.

I'd like to know a little more about how the Auditor General's office goes about auditing the different departments. Do you have a group or one auditor who will audit each department's performance individually? If so, why don't you have this person report to the committee—it's just a suggestion—before the department itself reports to the committee so that members of the committee would have on hand a different point of view and a non-partisan point of view, if you like?

Ms. Maria Barrados: First, in terms of the comment on policy, we really try very much not to make any judgments on good or bad policy. I can't speak for what happens to the reports when they're reported in the media because we don't have control of that. But we're very careful in our reporting to stay on the right line of that debate, because we don't want to take over the role of members of Parliament. It's not our place. I agree with the member. We have the same view as to what we should be doing.

In terms of the question about how we do our audit work, we are organized in groups and teams. Each major ministry has an audit team. Some of those teams will have responsibility for a ministry and then one or two small entities as well that are associated with the ministry. They're responsible for the audit work in that department. They will produce on a regular basis audits about that department.

Our office is always happy to come before standing committees to talk about any of those audits. If there are any audits that have been done in a department, members of my office will come and talk about that audit at any time that is convenient to the committee. I think this is a little narrower than you had in mind, Mr. Serré.

There is also some discussion going on about some form of assurance on the performance reports. What is meant by this is that there is an external look at the quality of the report. This then would be providing advice to members about the quality of these reports, how good they are, what's missing, what's reliable, and what's not so reliable.

Different jurisdictions have tried different ways of doing this kind of thing. There is a committee of parliament in New South Wales in Australia that looked only at the quality of reports, for example. That was viewed as its task. It had researchers who did that, who scrutinized these reports, and in this way provided advice to other members as to how good these reports were.

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The discussion that is going on amongst practitioners is what the external auditor, or the internal auditor, potentially could do in terms of providing assurances on the quality of the reports. Then members would know, when they get a report: this is reliable; this is good information; this is not good information; this is complete; this is not complete.

So this kind of discussion is going on. The Auditor General has offered to do some of this work.

Mr. Benoît Serré: Maybe it's a matter for the committee to discuss later on amongst ourselves on how we want to proceed.

You've mentioned that the motion in the House was to put it in place on a pilot basis. You stress the need that it would be permanent. You say other jurisdictions, for example, have turned to legislation.

Could you tell us which jurisdictions? Has the Auditor General officially recommended in his report that it be legislated?

Ms. Maria Barrados: We do have a concern that the motion in the House was only for a pilot basis and that all these initiatives are now starting. There are a fair number of growing pains with these things. Departments have been asked to do a lot suddenly, and they feel pressured with all the cutbacks. So we feel it's very important that this has a continuity and that it continues past the pilot phase and begins to take hold.

We have not made a specific recommendation that there should be legislation. Legislation is not the only way to go. There can be other ways to have some permanence to this type of thing. We raise it as a way of saying, yes, this is one route to go. There would be other ways of doing it, but for us it's important that it continue.

In terms of your question about jurisdictions that have legislation, there is what is usually termed “accountability legislation”. There's legislation in the province of Alberta. There's legislation in western Australia. There's legislation in some states in the United States.

John Mayne, maybe you can talk briefly about the American legislation.

Mr. John Mayne (Principal, Audit Operations, Office of the Auditor General of Canada): Thank you, Mr. Chairman.

In our chapter we pointed out a couple of cases of parliamentary systems that have used legislation. In the U.S. the federal government has very extensive legislation in place, but it's fairly new legislation. It's requiring reporting plans, and reports against them on performance, by all the federal agencies.

A number of states in the U.S., in advance of the federal legislation, have also themselves passed legislation requiring certain forms of reporting back to their own legislative bodies.

In Canada I think the Alberta case is the one most close at hand, one where they have legislation requiring this form of reporting. It certainly is one way of helping to make it occur. As you've said, our concern is that the current initiative continue. I think there are options on how to do that. We're waiting to see what the government will do.

Mr. Benoît Serré: Thank you.

The Chairman: Thank you, Mr. Serré.

Madam Girard-Bujold and then Mr. Provenzano.

[Translation]

Ms. Jocelyne Girard-Bujold: Madam, we have been talking since this morning about departmental performance reports, about program and service performance, about management for results, but to my constituents all that stuff is Greek.

Do you know what these people are telling us when they come to our constituency office? Did you know that only 40 percent of them can reach the Employment Insurance Infocentre, that only 50 percent of old age people can get in touch with a public servant to claim their Canada Pension Plan benefits, that there are very few people who can have access to a public servant to claim their family allowances? I don't know how the efficiency of a system can be evaluated if essentially only 50 percent of the population can use it.

More and more, it's a voice mailbox we are talking to, but people are unable to understand how those voice mailboxes work. On the other hand, we can have access everywhere to all kinds of information, but that information is so diluted that we don't know what way we are going. And when public servants send you claims, you cannot understand their jargon. That's what I hear from my constituents.

When you made your reports, were you aware of those facts, did you have an idea of the problems ordinary people are faced with? Did you know about all the difficulties they have to get access to government programs they need every day?

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Ms. Maria Barrados: Mr. Chairman, this is a very important question, really. When we made our audit on the quality of services, we found the same type of problems the member is referring to. That's a fact, and enhancing the quality of services is one of the biggest challenge government is facing. This is a challenge for many government departments.

After that audit, the government made many commitments about service improvements, but it is not easy. However, being clear about expectations and results is a very important aspect of that improvement. Indeed, the only way to make those things better is to try to measure performance, to analyze reactions and to improve services on the basis of that analysis. That must be done.

Ms. Jocelyne Girard-Bujold: But, to improve services to customers, should we not come back to the old system, where you could reach someone in person instead of an electronic device for first-line services, for your first contact with a department? At that stage, we should be able to talk to a human being.

I can agree that higher level public servants can have their voice mailbox, but should not the first contact with a department be established in a more human way? Did you make that suggestion to the government?

Ms. Maria Barrados: That's a question about which we might discuss at length. In fact, what is important is to know what is the best service or the best way to provide that service in a given context, and then find when direct approach is the best option. In some other contexts, it might be the voice mailbox. But it depends upon the circumstances.

Ms. Jocelyne Girard-Bujold: I would like you to explain me the difference between the two, because I don't see it. Even though I take what my constituents are telling me, I don't see the difference between the two options that you mentioned.

Ms. Maria Barrados: Very often, the information a customer is asking for is very simple. For such a very simple and not complicated information, a voice mailbox on touch-tone phones should be more than enough.

But for more complex issues, for people who have problems using the phone, it becomes very important that public servants be ready to provide the service themselves. Departments must take into account the type of service provided, the type of customer to be served and the relation which much exist between the service team and the customer.

Ms. Jocelyne Girard-Bujold: May I ask a last short question?

The Chairman: Yes.

Ms. Jocelyne Girard-Bujold: Did you know that in the case of those basic services which you consider very simple, most people come to my constituency office and tell us that they understood nothing of what was said to them? It's often a type of language that they don't understand.

Ms. Maria Barrados: It's surely something that must be improved. And the key to improve those services would be to hold consultations with customers in order to know exactly what is not clear, what is not understandable. This is very important.

Ms. Jocelyne Girard-Bujold: Thank you, Mr. Chairman.

The Chairman: Thank you, Jocelyne.

[English]

Mr. Provenzano, please.

Mr. Carmen Provenzano (Sault Ste. Marie, Lib.): In chapter 5, your conclusions, there's a suggestion that progress in performance reporting might be enhanced if it was used by the Treasury Board Secretariat and by standing committees. You then make the suggestion that standing committees could possibly link up with the budget process. I'm just trying to get my head around that suggestion. In practical terms and in practice, what's the scope of that link-up and how would it work? Specifically, looking at this standing committee, what would be the scope of the link-up as you see it, and in practice how might it work?

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Ms. Maria Barrados: The idea behind separating the old part IIIs into plans and performance reports was the notion it gave committees the opportunity to input into the budget process.

On exactly how that works, it is indirect in the sense that the performance reports come to a committee such as this. As part of their examination of these performance reports, members can choose to make a report to the House on things they would like to see changed or improved that would have an impact on the budget. The commitment on the part of the government is that this input from committees will be part of the considerations in the budgeting process. So there's an opportunity here to input as the budget is being put together.

The cycle then continues, of course, because in the spring there's the budget and then there are plans. There's an opportunity again to look at those plans and the work the committee has done, see what kind of response there is and follow it, always with the opportunity of going back to report to the House.

This is very much what was in the mind of the government when it did this.

The Chairman: Mr. Provenzano, is that okay for now?

Mr. Carmen Provenzano: I guess I have to go through the process once.

The Chairman: I think it's a good point. The idea is to get committees acculturized to the process and involved in the steps along the way.

Ms. Maria Barrados: On something like service quality, if that is a preoccupation, there's a responsibility in Treasury Board for service quality. The performance report of the Treasury Board had some words about service quality. This is an opportunity to ask questions about whether or not effort is being given, what is being done, what the expectations are, and what the performance is. There's an opportunity to report back on the basis of those reports.

The Chairman: Thank you very much.

I think Mr. Cullen wanted to come back for a supplementary.

Mr. Roy Cullen: Thank you, Mr. Chairman.

I have two questions. The first one really builds on Mr. Wood's point. Do the departments right now have the flexibility to reward managers and officials who get results? I know in the organizations I've been involved in where we had management by results and performance management systems, there was a way to reward employees who achieved results. I am wondering if we have that flexibility in the federal government.

Second, if we're managing for results, what exactly does that mean in the federal government context? If we look at the private sector experience, management by results grew out of management by objectives, where there was a feeling that MBO was too inflexible. So you might say “I'm going to increase my market share over the next two or three years by x per cent in a certain market”, but the world might change. The world is rapidly changing and the priorities might change so at the end of the day you might change that objective. But there was a way of measuring whether you achieved results because you might be able to say “That niche got crowded. We moved into another area, but my bottom line shows me I still made a return on investment of x per cent.” So we'll take it that you weren't really looking for excuses. The world had changed, you made some good adjustments and got results.

In the federal government context, I can see where you said you were going to accomplish x and here's how you did against the objective you stated.

In our management by results or performance monitoring, is it simply a matter of measuring how you performed against what you said you were going to do? Is there any flexibility there, recognizing there's an opportunity for managers to make excuses that they had obstacles so they moved off to other areas? How do you deal with that in the federal government context?

Ms. Maria Barrados: The answers aren't easy. It's a difficult question, but I'll give it a try.

The whole system you're seeing in terms of the performance reporting to government and then the plans and priorities is also linked to the internal planning in government. So you have the internal planning and you have how management works in government.

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What you see as members of Parliament should be a reflection of what is going on in there. That's a very important part of this. Hence our emphasis on the managing for results being at the base of it, because it serves no useful purpose if you get reports that don't reflect what is actually going on.

On your question about flexibility, I think what we learned from PPBS, management by objective, that whole genre of activities, was that we could never be too rigid about these things. Nor could we bring it down to too small a unit, because if you bring it down to too tiny a thing you've got very much a control mentality, and that's not what we're trying to do here.

It's important that the focus on the results you're trying to achieve is fairly high-level. The targets may change, but as a public activity, as public servants, you have your directive that is politically given. That can change at any time. That comes from a different level of activity. Once you have that directive and you know what your general marching orders are, that's what you should be working towards.

There has to be flexibility in those specific expectations that are set. What we would like to see is an honest attempt to deal with this. So either say, yes, we didn't make it, hence we have to make these kinds of changes, or else say, we didn't make it because this expectation is totally unrealistic and we're going to have to revise that. But there has to be a transparency in doing that.

Your third area you were asking me about was reward and flexibility in the public service. There are efforts to reward this. We are not alone in speaking about the importance of managing for results. The examples we are drawing from are from government managers who have done this.

As observers, we would like to see more. There are a lot of constraints in this system, there are a lot of difficulties in the system. There may at this time not be that much flexibility as the public service is coming out of its downsizing, is coping with new changes in management, is faced with some very serious renewal questions, and has major problems with its human resource management systems. There's no question about that.

Mr. Roy Cullen: Is there any flexibility? Does the deputy minister have any flexibility in terms of increments or what in the private sector we would call bonusing? Is there any flexibility like that at all, where you have departmental goals that translate into divisional or branch goals and it sort of cascades through? Then on the roll-up you say, certain ADMs performed against what we said we were going to do but others didn't, so they have less flexibility in terms of rewards. It sort of cascades through based on whether you're able to achieve your overall mission over a period of time.

Ms. Maria Barrados: I think most people who work in the public service will very quickly respond that they've been under wage freezes for a long time. Deputy ministers do not have the flexibility in terms of wages. There is now discussion on how that will change.

The flexibilities in terms of your remunerations really aren't there. There are, however, other ways to reward people. A lot of people are in public service not for the money but because they want to provide public service. There are a fair number of levers that deputy ministers have in terms of reward and recognition that are non-monetary.

The Chairman: They were very good questions this morning.

If I might allow myself just a short one, does the Government of Canada ever survey clients, follow up, as is done with consumer surveys, asking how they feel they've been served by department X or program Y?

Ms. Maria Barrados: Yes, they have. In the audit report that I was speaking about earlier in terms of service quality, we referenced some of those. The results were very disappointing and disheartening, because service provided by government was viewed more negatively than other service in the private sector. There were some dimensions of this service as viewed from the public that can be understandable, in that public servants were viewed as sometimes being slow and preoccupied with rules and process. That's not the fault of the individual public servant giving the service; they have to follow those rules.

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But there were other findings that were rather disturbing in that public servants were found to be less courteous. That's hard to explain. The government took this very seriously to heart and they set up a deputy minister's task force. They have done subsequent studies to try to improve this. So there are strong commitments to make improvements here.

The Chairman: On behalf of all members, I'd like to say thank you to both of you and your accompanying officials for your presentation today. Based on the quality of the questions, I think there is certainly some more time we could spend on this and possibly in the new year have some hopefully helpful suggestions to assist all parties. So thank you very much for your attendance today.

We stand adjourned until Tuesday. Colleagues, on Tuesday we are doing future business. It will be a short meeting. You will get an agenda ahead of time. Thank you.