HEAL Committee Meeting

STANDING COMMITTEE ON HEALTH

COMITÉ PERMANENT DE LA SANTÉ

EVIDENCE

[Recorded by Electronic Apparatus]

Tuesday, March 27, 2001

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[English]

The Chair (Ms. Bonnie Brown (Oakville, Lib.)): Good morning, ladies and gentlemen.

We are currently one short of quorum for any kind of voting anybody might have in mind, but we have sufficient members present to hear witnesses, so with your concurrence I'd like to begin.

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I'd like to welcome the representatives of the Auditor General's office: Ms. Barrados, Mr. Campbell, and Mr. Timmins. Thank you very much for coming on fairly short notice. I invite you to go ahead with your presentations.

Ms. Maria Barrados (Assistant Auditor General of Canada): Madam Chair, thank you for this opportunity to appear before your committee to discuss our work.

I have with me today Ronnie Campbell, audit principal, who is responsible for much of the work in Health Canada; and Doug Timmins, Assistant Auditor General, who is responsible for the audit of regulatory and agriculture programs in our office.

Since this is a new committee, I would like to take this opportunity to provide you a brief overview of the mandate and work of the Office of the Auditor General. I would also like to summarize our recent reports on Health Canada, as well as the work we now have under way.

As you know, Health Canada's budget for this fiscal year 2000-2001 is just over $2 billion. It has over 6,700 employees. Its programs and activities protect and promote the health of Canadians, administer the Canada Health Act, and ensure the provision of health services to first nations people living on reserves.

Health Canada's work presents it with several challenges, as is evident from our audit. These include complexities related to jurisdiction in the area of health, political sensitivities related to the Canada Health Act, and the challenges the department faces in working with first nations to deliver health services to them.

Under the Auditor General Act, the Office of the Auditor General is responsible for conducting independent audits and examinations. We undertake financial audits, special examinations of crown corporations, audits of environmental and sustainable development activities, and value-for-money audits of departments and agencies.

Our audits focus on the implementation of policies and programs, and also examine government-wide issues such as estimates, performance reporting, and financial management. Each year we submit up to four reports to the House of Commons. One of these is the report of the Commissioner of the Environment and Sustainable Development.

We plan our work on an annual basis. In developing these plans for future years, we would be interested in hearing about issues that your committee considers important for audit examination.

On March 5 the Auditor General wrote to the committee to raise some outstanding issues from value-for-money audits that may be of interest to the committee. I will briefly summarize some of these.

Our 1999 report included chapters on national health surveillance, and the management of a food-borne disease outbreak. We observed weaknesses in national surveillance of diseases and injuries that, taken together, have clear national implications for public health.

First, these weaknesses compromise Health Canada's ability to detect, anticipate, prevent and control health risks associated with outbreaks of communicable diseases, and with other health threats. Second, they compromise its ability to plan, carry out, and evaluate public health programs and other programs that deal with the causes and treatment of diseases.

In examining the outbreak of a food-borne disease, we found a lack of full cooperation among the agencies involved in responding to it. The public accounts committee held a hearing on these chapters and issued a report. The department concurred with our recommendations, and corrective actions are ongoing.

In recent years we have twice reported to Parliament on the management of health services delivery to first nations—on which Health Canada spent over $1 billion a year. In 1997 we reported serious shortcomings in the department's management of its contribution agreement and transfer agreements with first nations for delivering these services. We also found significant weaknesses in the way it managed non-insured health benefits, including pharmacy benefits.

In our 2000 follow-up, we remain concerned that Health Canada has not made enough progress in fixing many of the problems we had identified in our 1997 audit. Both your committee and the public accounts committee held hearings regarding our 1997 chapter. As you may be aware, Madam Chair, the public accounts committee has asked us to appear before it on April 5 to discuss that follow-up work.

[Translation]

In 1999, we reported on Health Canada's administration of the Canada Health Act. Health Canada does not have the information it needs to effectively monitor and report to Parliament on the extent to which provinces are in compliance with the Canada Health Act. Parliament cannot readily determine from the Department's annual reports on the Act to what extent each province and territory has satisfied the five criteria and conditions of the Act.

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Federal funds are transferred under the Canada Health and Social Transfer in a block, allowing provinces and territories the flexibility to allocate the funds as they choose among health care, post-secondary education, and social assistance and social services. As a result, the federal government is not in a position to determine what its total contribution to health care really is.

In September 2000, the First Ministers issued their "communiqué on health" committing to provide clear accountability reporting to Canadians. This accompanied the announcement of $23.4 billion in new federal investments over five years to support health renewal.

First Ministers directed Health Ministers to collaborate on the development of jointly agreed upon indicators such that each government will begin reporting by September 2002. These comparable indicators are to address health status, health outcomes and quality of service. This public reporting will involve independent third party verification.

Each jurisdiction is to report on a series of 14 indicators that have been agreed upon. Some provinces have already indicated they want their provincial auditor general to undertake this independent verification; other provinces have not yet decided who they will designate.

Health Canada, on behalf of the federal government, also has an obligation to report to Parliament on these 14 indicators. The Office of the Auditor General expects to be asked to provide the independent verification.

[English]

Madam Chair, your committee may wish to ask Health Canada for further information on what action it has taken in response to the recommendations in our chapter on the Canada Health Act, as well as its progress in implementing this new reporting regime.

Federal health and safety regulatory programs may also be of interest to your committee. In December 2000 we issued a report on major trends and the challenges facing health and safety regulatory authorities. Other chapters examine food inspection programs, the regulatory regime for biologics, and regulation of nuclear power plants. Another followed up on previous recommendations.

The broader chapter dealt with major trends and challenges faced by health and safety regulatory authorities. We expressed our concern about the capability of federal health and safety programs to overcome recurring weaknesses and meet significant challenges.

We noted that dealing with these problems and challenges in areas such as food inspection, biologics, and power reactors regulation will require determined and coordinated action between federal departments, as well as cooperation among federal, provincial, and international jurisdictions.

Madam Chair, your committee may be interested to know about work being currently undertaken by our office on Health Canada. Our December 2001 report will include a value-for-money chapter on health promotion. In 2000-2001, Health Canada spent $358 million on health promotion activities. We will be looking at the management of grants and contributions and other issues related to promotion programs.

The December report will also discuss our follow-up on our 1998 audit of the Patent Medicine Prices Review Board. We will look at whether the board has implemented our recommendations, as it has agreed to do.

The Commissioner of the Environment and Sustainable Development has also tabled several chapters that address the relationship between the environment and health. The commissioner's next report, to be tabled in October, will include additional chapters that may be of interest to you.

Madam Chair, that concludes my opening statement. My colleagues and I will be pleased to answer your committee's questions. In addition, we welcome your suggestions on issues of particular interest to the committee for consideration in our planning.

The Chair: Thank you, Mrs. Barrados.

Mr. Merrifield, are you ready, or should I start with somebody else?

Mr. Rob Merrifield (Yellowhead, Canadian Alliance): Well, I can start with a question or two.

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I appreciate the information we have here this morning. It certainly gives us a snapshot of what you're doing with regard to food-borne disease outbreak. That's a report that came out in 1999.

It concerns me a little bit what you suggest about Health Canada's ability to detect and anticipate a problem that could be a health risk. Can you elaborate on what you mean by that and what preventative measures you think should be taken?

Ms. Maria Barrados: Could I get a little bit of clarification? Is the question related to the specific example of the salmonella outbreak, or is it more generally through surveillance?

Mr. Rob Merrifield: More generally.

Ms. Maria Barrados: The chapter that we did in 1999 was looking at the surveillance systems that are in Health Canada, and we raised a number of issues. I can describe some of those briefly, and you can follow up on them.

One of our concerns was that there was no framework or empowering legislation. It doesn't have to be legislation, but there wasn't a framework that defined Health Canada's role for public health, what its role was vis-à-vis the other players in collecting this information.

Then we looked at some of the specific systems that were operating. We found that there really was a lack of understanding on what people were to do, because this has to be done cooperatively. Information from Health Canada has to come from physicians and other health care providers. They're not in the federal domain, but they have to be brought together.

We raised a number of issues about lack of protocols, about lack of standards in common definitions of terms, and about the completeness of the data series. So there were a number of detailed issues that we raised.

The second part of that report dealt with a particular food outbreak that we examined as a case study, and we included that in this report because it had a unique combination of things: it was a food-borne outbreak that resulted in illness, so it involved the Laboratory Centre for Disease Control, or Health Canada, and the CFIA. Our observations there were that they really did not collaborate as well as we would have expected.

Mr. Rob Merrifield: Okay. That was in 1999. This is 2001. Are we learning from our mistakes, and have we taken corrective action? Are we still at the same risk? Are we collaborating between departments now? What do you see?

Ms. Maria Barrados: As a standard, we go back every two to three years to see exactly what the progress is on these recommendations. There are a number of things in here that will take quite a bit of work to fix; they're not easy. The department has committed to take corrective actions. I think they still have a way to go in a number of those. That would be a good discussion with the department.

In terms of collaboration with departments, collaboration between CFIA and Health Canada, at the end of this audit there were commitments to clarify and improve and put protocols in place. We haven't had another test quite like this to test that working relationship.

Mr. Rob Merrifield: Thank goodness, but it could be coming. Thank you.

The Chair: Thank you.

Mr. Dromisky.

Mr. Stan Dromisky (Thunder Bay—Atikokan, Lib.): Thank you, Madam Chairperson.

I see your role as being an extremely complex one, there's no doubt about it. We're concerned here about the health and safety of Canadian citizens and the regulations that govern the strategies and everything else that protect the people in this country. We have the Canadian Food Inspection Agency, Health Canada, Environment Canada, Transport Canada, the Canadian Nuclear Safety Commission, and the National Energy Board—everybody is involved in administering major health and safety regulatory programs. It's your role to see how effective this whole network of services really is.

I see it as a very complex network, and what I'm concerned about is how in the world we can get this whole network of services from all these various departments to work in a very cooperative manner to bring about the most effective administration of regulatory practices and services to protect the health of Canadians.

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The first question that comes into my mind is where are the weak links in this whole network? Are there some that are so weak that it's affecting the outcome and the progress of other departments within that network? I see the whole thing as one big system, one big process. What is weak in one area will affect the outcome in other areas. Can you answer a simple question: where are the weak links and where are the strongest?

Ms. Maria Barrados: I'll ask my colleague Doug Timmins to respond specifically to your question about the regulatory framework and that complexity.

I would like to make one comment: that in the kind of work we do, we look at specific pieces and at the overall system. The package of work on the regulatory audits was in fact that kind of combination. Mr. Timmins was responsible for that, so I'll turn it over to him.

Mr. Stan Dromisky: Okay.

Mr. Douglas Timmins (Assistant Auditor General, Audit Operations Branch, Office of the Auditor General of Canada): Thank you, Madam Chair.

That's a very broad question. I think our whole chapter attempts to address some of those concerns or some of those issues, so I'm going to try to run through what I think are the highlights of what we found in the chapter.

It's difficult to respond in the sense of saying that they are all interconnected. They are all interconnected in the sense that they all relate to health and safety. As Ms. Barrados has mentioned, some have to deal together, such as the food agency and Health Canada. However, overall, what we found to be the biggest weaknesses, or what was lacking, was to identify the balance that is to be reached between the health and safety risk management that you're able to deal with, and things such as the cost of providing that risk management, the economic, trade, and social factors that are also involved.

So it's more in terms of educating, being clear in terms of what you can do and what you can't do. You can't eliminate all risks with any system. I think that would be the first point I would make.

The second point deals with risk management itself. What we found was lacking in general among a number of programs we've looked at, not just currently but over the last ten years, is the need for better information about risks—and this gets back to an earlier question. We need better surveillance systems in terms of information. We need to have impact assessments in terms of the risks, and then make the decisions in terms of allocating resources.

I think those kinds of factors apply to most programs we've looked at, a number of them. If you want more specific details of those, I can get into some of the examples in the chapter. But we've tried to lay out in chapter 24 of our December report a number of issues dealing with the issues of human resource management, with risk management, and so on. We've gone through the history and identified what we thought those concerns were in the various programs we've looked at over the years.

The last point I would touch on that you raised is coordination and cooperation. Where we found the bigger problem was going beyond the federal system. There are provinces and others that are involved, and in the area of cooperation and risk I think that is the biggest one that we identified.

Mr. Stan Dromisky: I would like to ask one more question.

In examining what you people are doing, in light of the kind of reporting you're doing, and the fact that you mention that you zero in on a specific function and examine it carefully—in other words, you are examining separate, individual pieces of a great jigsaw puzzle—could it be that your method has weaknesses in itself, inherent in your process, in determining whether or not objectives can be reached?

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You made statements in here and throughout your publication about where the weaknesses are and the problems that prevail. When I stop and think about them and dwell on the concept that you have presented, I'm saying to myself, I think that these problems, or some of these problems, are going to be with us forever and forever because human beings are involved. Maybe the tools and the strategies that we're using for examining and for auditing also contain inherent weaknesses. So we will never be able to come up with a system that is going to be satisfactory or most effective in terms of the use of human resources and financial resources and meeting the objectives that we have stated.

I'm not trying to be pessimistic. I'm just trying to say that I think we are very optimistic in the statements we have made, and that it's quite possible that we might never reach our goals.

Ms. Maria Barrados: Madam Chair, that's an interesting question, and one we actually worry about. We worry a lot in our office, and we commit a lot of resources, and we have a lot of review. We have a lot of discussion about all our audits because we want to make sure that we put the best results that we can forward to Parliament. But the focus of our work really, by and large, is looking at what government is setting out to do and whether government is doing it. So we are in that realm of looking at the policies, what the commitments are, and is it actually being done. That's where we focus our work.

Now, in doing that we don't have the same kind of challenge on policies where you get to some of those bigger questions, and which this committee may often pose.

We will point out problems. We'll point out areas where there's a policy vacuum or there is a policy inconsistency. It is really very much a focus on implementation. Another part of our focus is very much looking at the kind of information that is provided to Parliament. So as Parliament's auditor we are always looking to make sure that you get the complete picture and a full piece of information on what is presented.

Our own mandate is a federal mandate, so we tend to look at federal programs and federal activities, but as much as possible in the work that we are doing, we are providing the links with others. Because certainly Health Canada, and for many of the areas that it's responsible for, has to rely on the cooperation of other players in the system. We've had pretty good cooperation from others giving us information so that we can try to present as complete a picture to Parliament as we can.

Mr. Stan Dromisky: Thank you very much.

The Chair: Thank you, Mr. Dromisky.

Mr. Lunney.

Mr. James Lunney (Nanaimo—Alberni, Canadian Alliance): Thank you, Madam Chair.

I would like to also welcome the witnesses. We really appreciate the role of the Auditor General's office in helping to keep government on track and helping us all to understand these very, very complex issues, particularly in this area related to health.

My question comes out of chapter 25 and has to do with the Canadian Food Inspection Agency. The report comments on the non-federally regulated sector—that in fact the agency cannot with current resources properly assess the risk to the public, and that represents some 5,000 food processing establishments, and so on.

I understand that only about 5% of the agency's resources, or about 160 staff positions, are allocated to the non-federally-regulated sector. Now, I understand that the Canadian Food Inspection Agency has disagreed with your office's recommendations in terms of managing their responsibilities in the non-federally-regulated sector. They're saying it's not their mandate, constrained by existing legislation and the limits of the Constitution.

Mention was made about memorandums of understanding, and I wonder if you could expand on that and give us some understanding as to whether there's any progress in this particular area of concern.

Ms. Maria Barrados: I'll ask Mr. Timmins to speak to the specific point on the food agency, and I can clarify more on the case of the salmonella and Health Canada. Doug.

Mr. Douglas Timmins: Thank you, Madam Chair.

I think I would say that there is no real progress in terms of resolving the difference of views. The food agency has two concerns besides the fact, I guess, that they don't have sufficient resources currently to allocate more to this. They feel that the magnitude of the concern with the number of establishments that are out there and the nature of them, which includes restaurants and so on, some that come and go.... Knowing what exists and what the risks are varies from day to day. So I think initially they feel that is the concern.

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The second concern is, as you've mentioned, sort of constitutional, where they feel that there are provincial responsibilities. So the nature of that environment, when it's called non-federally-registered, means that it is providing products or services that are within a province. They're not transborder, and they're not internationally dealt with. So that's why the constitutional debate arises.

However, they do get involved, and they do have a responsibility. Our position has remained that an overall assessment of the risk is required. They have done some work, which we point to in the chapter, that we think are good examples of the type of work they should do in that regard—where they assess the bakery industry, for example.

The problem is that there are a number of products in there that can be produced and developed and can result in food recalls and so on, and that's when they get involved. We're suggesting that having some overall assessment of that risk, knowing and cooperating with the provinces, and knowing that the provinces are in fact covering them and that they share work plans and so on, is a better way to go than just saying that we can't look at that. We think they can do something. It may not be that they go out and provide inspections of all these premises, but some risk assessment can be done, in our view.

Ms. Maria Barrados: Madam Chair, I'd just like to add something on the relationship between the food agency and Health Canada.

The food agency is the responsibility of the Minister of Agriculture and Agri-Food. Health Canada has a different role in relationship to the food agency, and it's an interesting one. They are the ones who set the standards, and they are the ones who have an oversight role on the activities of the CFIA. That relationship between Health Canada—how it discharges its responsibility—and the CFIA might be an area of interest for this committee.

The particular case that we were talking about in terms of the salmonella outbreak was getting to the level of a different part of Health Canada that wasn't responsible for setting the standards and doing the audits of the CFIA, and how they work together with the people who were doing the surveillance. That protocol had not been put in place at the time that we made our report. They have since put that in place.

Mr. James Lunney: Could I ask one more question, in a different direction?

Going to chapter 15, to do with first nations health, one of the issues that was raised had to do with prescription-drug-related deaths of first nation individuals in all regions. I believe you had recommended that Health Canada should look into this, and Health Canada's response was that the department would liaise with the provinces with respect to the prescription-related deaths. Can you comment on where we're at with this now, and did Health Canada comply in this regard?

Ms. Maria Barrados: In the case of the audit on first nations, we had done an earlier audit, and we had done a follow-up in October 2000, so that's fairly recent. What that report is saying is that there was not satisfactory progress in this area. The department did put in a point-of-service, point-of-sale system, but we found when we did our follow-up that they had not really been monitoring the kinds of messages that were coming through that system. We found, when we looked at the utilization of the prescription drugs, there was still a problem. So what we are recommending to Health Canada is that they do more in terms of the analysis here to really get to the bottom of what is going on, because there still is a problem. It's very serious, and we are concerned.

There had been some other initiatives that had taken place that were stopped because the department didn't feel it really had the mandate, and that's another issue associated with this area.

Mr. Rob Merrifield: I'd like just to follow up on this question.

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The Chair: Actually, I think I have to go over to Mr. Bonin. Take note of what you want to ask, and you'll probably get another turn.

Mr. Rob Merrifield: That's fine.

The Chair: Mr. Bonin.

Mr. Ray Bonin (Nickel Belt, Lib.): Thank you, Madam Chair.

To our witnesses, the last few governments went from a deficit of $42-some billion per year to a position in which Canadian taxpayers are starting to pay back a debt, taxes are being reduced, and the rebuilding has started. I have no doubt that is what Canadians want.

Evidently, the work you do is very important, and there are real problems that need to be identified. I always tell my constituents not to worry about criticizing us. I'm in politics because I don't like the way things are going. The day I like everything that is going on, I'll go fishing.

Your reports tend to reach very far into government and into Canadian life. When I listened to Mr. Desautels giving his report, one of my colleagues said he'd like to know what school the man went to because he knows everything. Maybe my grandchildren should consider going to that school.

What I don't see in your reports is a rapport between your criticism and the choices that Canadians made, because every department in this government evidently has insufficient funds. Yours probably does also. So I would look, as a taxpayer...when we're trying to be accountable to people, I would hope that, sure, we would identify that something is a problem. But this is what Canadians accepted when they decided to balance the books.

The real concern that I have is that when your report comes out—and I say it's far-reaching, but I think it reaches too far—it contributes more to the apathy of Canadians than any other thing that goes on. Here's a report that criticizes everything the government does, in every department. I don't believe every department is wrong and that yours is perfect. I'm more concerned about being accountable to Canadians and giving a picture that is reasonable. Your reports reach out to policy, to every aspect of administration, and I think that goes too far.

I don't know how you're going to respond to my comment, but you are contributing because of the way you report—and let's be very clear that I'm not suggesting there are no problems that should be identified, because there are lots—and in the way your report comes out. When it does come out, the opposition parties do the job they're supposed to do. I'm not criticizing them for doing what they do, but your reports contribute more to the apathy of Canadians, which should be measured because it affects our government.

Ms. Maria Barrados: Madam Chair, I'm not sure I can answer all that, but I will try to make some comments.

In our office we are always trying to look at ways to improve how we do our work and the issues we examine. My question to the committee, asking for input into our planning, is a genuine one. What you think as members of Parliament, what would be most interesting to you, shapes how we do our work.

Unfortunately—or fortunately, depending on where you sit—our critical comments are what get a lot more of the attention than the positive comments. But we do make positive comments as well. They tend not to be reported in the media, and they don't tend to be the issues used in challenge in the House. I think that's a function of our system.

For example, when we did the regulatory work in Health Canada on the Bureau of Biologics and Radiopharmaceuticals, we were saying they were doing a reasonable job and had a reasonable framework in place. We identified some areas they had difficulty with, and they recognize that they have difficulties, like getting proper staff. So we do identify those things, but they tend not to be the stories that are in the newspaper.

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As for your comment about my boss and leader knowing everything, he has a large office that is multidisciplinary. He relies on the input of his multidisciplinary staff, and in the way we do our work and our audits we also function with advisory committees of experts. We draw on a lot of experts. When we do our work, we do a lot of consulting, and of course we take every opportunity we can to meet with members of Parliament.

Mr. Ray Bonin: I just have two small points.

Does your mandate prevent you from identifying something when they say they need more staff? Well, fine, everybody needs more staff. I need more in my office. But could you not explain that to have more staff would cost another $15 billion a year? Maybe Canadians would then understand. If you're making a recommendation about a weakness—a weakness that has been accepted by Canadians when they decided to balance their books—then, in all fairness, you have to identify that correcting it should be accompanied by a statement of costing.

As my very last question, who audits your department?

Ms. Maria Barrados: In the case of the Bureau of Biologics and Radiopharmaceuticals, they have the money. They just haven't been able to find the people or work their way through government processes in terms of getting the people. That one is not an issue of money.

The point is well taken about where there are weaknesses that require investment and about identifying that need. There are cases for which we have made comments and observations that there is a problem that requires an investment for it to be solved. We recognize that. But that is then not our decision, it's a government decision or it's a political decision.

On the last point, about who audits the Auditor General, we have an external audit that is a financial audit, and it is done every year. We appear before the public accounts committee with our plans, and we are challenged by the public accounts committee on our plans and our budgets. We also have external peer review done on our financial audits, and we're in the process of putting that in place for our value-for-money audits. And we have internal audits on our administrative procedures.

Mr. Ray Bonin: So all the audits that you do are public, but the ones made on your department with.... Really, public accounts is not the most public forum that we have on this Hill. Maybe a future suggestion to our government might be that everything be made public.

Ms. Maria Barrados: The public accounts committee is public; their transcripts are on the record. And we also put the results of our own reviews in our estimates documents. If there's anything the member can think of to make these more public, we would agree with it.

Mr. Ray Bonin: Thank you.

The Chair: Thank you very much.

Ms. Wasylycia-Leis.

Ms. Judy Wasylycia-Leis (Winnipeg North Centre, NDP): Thank you, Madame Chairperson.

I have questions on three different reports, but I'm not sure of the scheduling for the rest of the morning. Should I try to pose all my questions at once, or...?

The Chair: Try to leave some room for your colleagues.

Ms. Judy Wasylycia-Leis: Fair enough.

The Chair: I'll report to you when you're at five minutes.

Ms. Judy Wasylycia-Leis: All right, thank you.

I just wanted to pick up where Mr. Bonin left off, because I think the concern he has raised shouldn't go unanswered.

It's my opinion that the Auditor General's office has in fact been performing its duties according to its mandate. If I had any concern, it would be that it sometimes doesn't go far enough in terms of describing in more clear language just how far the government is failing to live up to its obligations in terms of reporting to Parliament and in terms of proper accounting procedures.

I think that just needs to be said, because, if anything, the Office of the Auditor General has been fairly cautious and judicious in its comments when probably some of the situations warranted a far more critical, outspoken summary of the situation. But it has been sufficient and useful for focusing the attention of Parliament on some very important areas.

I think our biggest problem is that we just don't have a proper way to follow up with the Auditor General. We now have half a dozen reports accumulated before the health committee, and we're trying to do it all in one session. It's impossible to take the valuable information from these reports and follow each one up, and try to see if we can't, on a constructive basis, get the necessary changes.

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If there's anything we do, Madame Speaker—and I know we're starting fresh, and we have a new chair, and it's a wonderful new day—I hope it is that we in fact as a committee will agree to receive the Auditor General's staff after each report that pertains to the health committee. That way, I think we can keep on the top of the issues and do our job more effectively.

I'm going to start with the first report I wanted to deal with, the one on first nations health, because it really touches on Raymond's comments. I think in fact where we're failing Canadians, and where costs are going through the roof, is when government doesn't listen to the Auditor General's recommendations.

In the case of first nations health and transfer agreements, we have a case where there were problems. Let's deal specifically with something that's been in the news, Sagkeeng. Here's a situation, a treatment centre, that had problems identified back as early as 1996. Nothing was really done at that time. The Auditor General reported in 1997 about serious difficulties in adherence to standards and accountability. The problems continued, but no audits were actually done of Sagkeeng to the point where the government actually signed a major renewal agreement in the summer of 2000 without having done any kind of follow-up of the Auditor General's reports or acting on any of the concerns identified.

Now we have a huge problem where there is all kinds of speculation about wrongdoing. First nations communities are getting blamed and they're taking the full brunt of some of these problems.

It seems to me that if in fact the government had acted on your recommendations in 1997 in a concerted way, we might not be in this dilemma today. Instead we've been getting, and this is where I think your office sometimes is too cautious.... We talk a lot about the procedures that the government's putting in place, the new fiscal accountability measures, the federal accountability initiative, reporting and auditing guidelines, stuff that the department keeps coming forward with but doesn't seem to make any difference because they could have just acted on what they had. There are internal audit provisions that would have allowed the department, as soon as they saw any problems, as soon as anybody raised any concerns, to do a special audit and—

The Chair: Excuse me, Ms. Wasylycia-Leis. We're at four and a half minutes, and I haven't heard a question yet.

Ms. Judy Wasylycia-Leis: My question is how do we do our job in terms of ensuring that your recommendations actually turn into action or help when they're needed?

Ms. Maria Barrados: Madam Chair, I have a couple of comments.

Certainly we would be happy to come back to this committee at any time on any of the subjects that we've audited or any of our reports. So any way we can help the committee, we would be happy to do that.

Specifically about first nations, it is unusual for us to do a second full report. The reason we did a second full report is because we were not satisfied with the progress.

We do tend to make general comments, and we try to include specifics to give examples, but it is sometimes frustrating for people who are not in government when they hear us talk about contribution agreements, and the terms not being met on the contribution agreements, or a transfer agreement and officials not doing what is required in the transfer agreement. That tends to be our language, but it results in not looking at how money is being spent, not monitoring carefully, not following up if something inappropriate is going on. These processes, although it sounds very bureaucratic, are important vehicles that are in place to avoid the kinds of problems the member is speaking of.

The Chair: Thank you, Ms. Barrados, particularly for your offer to come back.

I'm trying to turn Ms. Wasylycia-Leis into an optimist. At the last meeting she said she only had access to the minister once a year, and I've told her that we can have him more often, and now you have furthered our road to optimism by saying you can come back any time we want you. Soon Ms. Wasylycia-Leis will be an optimist, and she might even become a Liberal, who knows?

Voices: Oh, oh.

The Chair: Go ahead. You have another question, Ms. Wasylycia-Leis.

Ms. Judy Wasylycia-Leis: Yes.

I'd like to come back to this, but in case I don't another chance, my next question pertains to the excellent report you did, chapter 29 on the federal support of health care delivery, where you identified that the government does not have sufficient information to effectively monitor compliance with the Canada Health Act. You also mentioned that we're not able to do our job because of the way in which reporting is done to Parliament.

• 1150

I have two questions. Number one, we still have that problem with reporting of the annual report of the Canada Health Act. We received a report in February 2001 that was good for the year ending March 2000. But the whole world has changed between March 2000 and the present, and we don't have a way to get at some of those changes and to hold the government to account for problems that have been brought to our attention around non-compliance.

What can we do to have more regular reporting, timely reporting to Parliament and reports that actually get at some of the substantive issues that are in contention around compliance or non-compliance?

That brings me to my second question. The only visible sign of reaction to your report, that I can tell, is that there was an announcement of $4 million for enforcement. We learned at one of our recent meetings that this will be used to hire 18 additional staff and deal with better reporting procedures. It certainly didn't satisfy me that this is an appropriate or complete answer to growing evidence of non-compliance. Also, we received from the department that there are 11 cases being investigated and there are no timelines. So we could end up with a situation of this being dragged out for another year, then it being reported in February 2002 for the year that ended March 2001. We don't have a way to monitor, and hold the government to account, and have the information to ask the questions that will lead anywhere. So that's my open-ended question.

Ms. Maria Barrados: I have a few comments, but I'm not sure I can address all these things.

The government, in its February report, recognized that they are not providing the kind of information we were talking about. So that's progress. And they acknowledged they have to do better on that, and they have a commitment to doing this. So I am encouraged, because they will strive to do this.

The most direct way for members of Parliament to get information is by asking the officials to come and appear before you and ask them the questions. I don't think members of Parliament realize the extent to which an official question has an effect in the bureaucracy. People prepare, people strive to answer.

The other thing that has been occurring, which I tried to link in my opening statement, in terms of the federal support to health care delivery, is the effort that is now going on to improve accountability reporting with the provinces. That is part of an effort that is being done jointly to improve the information so Canadians will have more information about what is happening in health care.

What is not being addressed is the issue of how much money the federal government feels it is contributing to health care. That is one area in the report where there wasn't agreement.

The Chair: Ms. Wasylycia-Leis, could you hold back? I know you have a third set, and hopefully we'll be back to you.

Ms. Sgro.

Ms. Judy Sgro (York West, Lib.): I have a couple of questions. I'm used to seeing you in public accounts, so now I can't ask you all the questions that are health-related.

I'd like to know, are we going to be able to have the health officials come in and answer some of the questions and recommendations that were made in the audit? Is that part of our planned process?

The Chair: Sure. The committee is here to serve your pleasure.

Ms. Judy Sgro: It's so nice that someone is.

The Chair: This is a first stab at it, and I think we're learning a lot this morning because of having the actual auditors in. I think that will lead to further questions. That's one reason it's good to not have too firm a plan for the next four years, because I want to be able to respond to the things you want to do. But for this morning, they're here to answer questions on what they have written about the health department.

Ms. Judy Sgro: And in our short-term strategy, did we allow an hour to have the health officials come back and respond to some of the recommendations that were in these reports, pertaining to a follow-up?

The Chair: We did not decide on that. We have a firm plan for a few meetings, and it's specific that it is a few meetings. We're not exactly sure when this legislation is coming. There may be room for a couple of extra meetings. So I would keep your suggestions in the back of your mind so that you can throw them out when I ask for the next set of wishes, which hopefully the clerk can fulfil.

• 1155

Ms. Judy Sgro: I have a couple of questions.

In your presentation you talk about the weaknesses in the national survey on some diseases, injuries, and so on. That chapter flags a variety of issues, some of which Mr. Merrifield had mentioned: issues with Agriculture Canada, and importing various foods and other things. That's an important area.

So if you made the report in 1999, do you require a further report from Health Canada to answer on those issues? Or do I assume, from your comments, that it hasn't been reported on as of March 2001?

Ms. Maria Barrados: The usual process of the public accounts committee, as you may know, is that we have hearings on many of our reports—though not all of them. If we don't have a hearing, then the chair of the public accounts committee asks the departments what they're doing on the issues raised.

In this case we did have a hearing, so the public accounts committee tabled a report, with recommendations. We intend to follow this up. We probably won't do it this year, because of my own workload issues, but certainly next year we'd follow this up to do a progress report.

This is an area where we know that everything can't be done in the time period we're talking about, just because of the nature of the system and the kinds of things that have to be done.

The people in the department fully agreed with us that these are problems. And they're important problems, because as a country we rely on having information about public health to guide decision-making, health care delivery, and programs. It is an important area, and one worth looking at in further detail. I think the department would be quite happy to come and talk about that.

We will follow up next year.

Ms. Judy Sgro: Just so I understand the process, if you make the recommendation, then most times you allow them two years before you go back and follow up?

Ms. Maria Barrados: That's right. It's generally two years. Sometimes, as in this case, it will probably be three years—just because of our own scheduling situation. Sometimes we might do it a little longer if there has been a lot of change.

Our reports have separate short sections, two or three pages, that follow up and give a status report on where these things are at. If we feel there hasn't been enough progress, or there are new problems, or more explanation is required, we would do a fuller report.

Ms. Judy Sgro: Does it have to take so long?

Ms. Maria Barrados: For us to do—

Ms. Judy Sgro: No, no. I'm asking the wrong department the question. But for issues that jump out, ones we're going to flag, I would assume the department starts taking whatever action it can to get the process going. By the time you report back, you'd be hoping all the problems have been rectified. But surely the department won't take three years to act on something that has been flagged as a weakness for them. But again, that's probably a question for Health Canada, and it's not fair to ask you.

Ms. Maria Barrados: Some things we don't have very much patience with, and we expect to see them fixed. In this case, when there are issues within the federal government of measuring performance, assessing their own results, looking at their own effectiveness, we don't have much patience. They should get on with it and do it. But in other situations they have to rely on the input of physicians, they have to rely on the provinces, they have to rely on cooperation to get the information they need. In those cases, we're more sympathetic. Given the nature of our country, it's hard to get those kinds of agreements.

Ms. Judy Sgro: Just one further question, on the issue of accountability to the provinces on the delivery of health care. I can relate to some of the problems we continue to have in Ontario: we're passing on the dollars, and they're not being invested in health care. In any of your reports, have you made any particular recommendations on how we can produce better accountability—rather than just writing the cheque and not having any, as it currently is? I know this is part of last year's agreement, but have you made any recommendations at all as to how we can hold the provinces accountable in the service delivery?

• 1200

Ms. Maria Barrados: In our chapter on the Canada Health Act we made two broad types of recommendations. The first was that the federal government should have some notional amount of the money it is contributing to health care, because, as you know, currently all the money is transferred together for health, post-secondary, and social services. There is no division, except for one new amount of $11 million that was tied specifically to health. So there isn't any idea of what exactly is the federal share or the federal contribution. So that's one area we commented on.

The second area is that we felt there was a need to improve the reporting to Parliament on meeting the conditions of the Canada Health Act. Once you start talking about comprehensiveness, accessibility, publicly funded, and those kinds of conditions, and start putting information on that, then it gives a better appreciation of where we actually are.

The agreement that was signed by first ministers is a start at getting the information to Canadians and to the respective parliaments on what is occurring in the health care system in terms of some of the system deliveries and health care status. This is early days, but it's a welcome initiative.

Ms. Judy Sgro: Thank you very much.

The Chair: Thank you, Ms. Sgro.

Mr. Merrifield.

Mr. Rob Merrifield: Yes, just going back, there's a number of these questions that I had down on my list as well. I don't know if I'm going to get through them all, but I want to go back to one just very quickly; then I'll have another one that will take us in another direction.

On first nations health, how cooperative were the department officials? Did you have problems with that during your audit? It was flagged as a problem a number of years ago and consists.... Where is the department on that?

Ms. Maria Barrados: We had good relationships with this department. I'll ask Mr. Campbell, who did the detailed audit work on that, to comment.

Mr. Ronnie Campbell (Principal, Audit Operations Branch, Office of the Auditor General of Canada): With regard to the first nations health audit, we had no notable concerns at all in terms of the relationships with departmental officials. We got everything we asked for in a timely manner and good cooperation.

Mr. Rob Merrifield: Okay, so no concerns there.

Mr. Ronnie Campbell: No.

Mr. Rob Merrifield: Now take us on another angle. You've identified, in chapter 26 of your 2000 report, xenotransplants. According to your department, you're saying that the department is very proactive as far as a regulatory regime and what it's doing there. Yet there seem to be some delays in the regulations coming forward.

Also in the report, it's saying that transplants of this type have been performed in the hospitals for a number of years. If that's really the case, then do you not have some concerns with regard to being as proactive as we should be? Perhaps science is getting ahead of our regulatory framework. Are there potential health risks to Canadians because of it?

Ms. Maria Barrados: There's a broad range of questions. I'll ask Mr. Campbell to fill in some of the gaps here.

My understanding is that xenotransplantation is not now occurring. The comments in the report are about other kinds of transplantations that are not regulated. We do stress in the chapter that this whole area is new and is moving very fast. There's a lot to be done. When we looked at the whole approach that Health Canada took, we said it was reasonable. Given that it was reasonable, we did identify areas where there were some gaps. We did identify things that they should do. They've agreed with those.

Mr. Campbell, do you want to add to that?

Mr. Ronnie Campbell: Yes. I'll just add that in the area of tissues and organs—where tissue and organ transplantation is happening and has been happening for some time—we were a bit more concerned about the fact that government's still working on a regulatory framework in that area. In the area of xenotransplantation, where that activity is not that far advanced, it's encouraging that they're working on the regulatory framework in advance of that becoming the norm. That was the difference in tone between the two pieces.

• 1205

Mr. Rob Merrifield: So you're telling me there's no xenotransplanting in Canada. That's misinformation that I had, then.

Mr. Ronnie Campbell: I hate to get too technical here, but with regard to pig valves and the like, things that come from other animals where that is not living tissue, that is not considered in the regulatory framework as xenotransplantation.

Mr. Rob Merrifield: I see. Okay. Maybe we're splitting hairs here, or pigs.

Mr. James Lunney: Pig hairs.

Some hon. members: Oh, oh!

Mr. Rob Merrifield: My concern is that we get these regulations in place, because I know the citizens of Canada are very concerned about this area. Having worked in the area of health for a number of years, I can sense the ethics in this. Where we're going with this in the 21st century is something that's going to be of great concern to the people of Canada and around the world. It's something we need to get a handle on. That's why I'm encouraging you as a department to keep your eye on it.

The Chair: Thank you, Mr. Merrifield. If there were a prize for being succinct, Mr. Merrifield would be in the lead to get it.

Mr. Charbonneau.

[Translation]

Mr. Yvon Charbonneau (Anjou—Rivière-des-Prairies, Lib.): Madam Chair, I have two questions. One concerns Chapter 25 and the Canadian Food Inspection Agency.

You focussed at great length in this chapter on HACCP-based programs, that is an approach based on hazard analysis and critical control points.

Is this approach comparable to a certain extent to ISO systems that have been implemented industry wide? I'm trying to understand the benefits of this approach versus other approaches. There must have been some other system in place prior to HACCP and this approach must have been retained because of certain qualities. I'm also intrigued by the fact that this approach has been in place for several years, at least since 1977 and maybe even longer.

You conclude your analysis by stating that the Agency has not yet found a way to gauge its success in implementing this approach, and you recommend a formal implementation strategy within the framework of the FSEP, the Food Safety Enhancement Program.

Is the HACCP-based program truly difficult or demanding to implement? What types of problems have arisen in connection with program implementation? You seem to have only positive things to say about this approach, but one could get the impression that implementation is a very time-consuming and demanding process.

Could you also answer the following question: did the implementation of this program lead the Agency to impose a moratorium on the importation of Brazilian beef? Was this program in any way a factor in this decision, and in its reversal two weeks later?

Ms. Maria Barrados: I will ask Douglas Timmins to answer your questions.

[English]

Mr. Douglas Timmins: With regard to HACCP—

The Chair: Perhaps you should explain what that stands for, for the people who are not familiar with it.

Mr. Douglas Timmins: It stands for “hazard analysis critical control point”. It is implemented in various forms, and it has similarities to the ISO standards in effect and approach. However, it is being accepted internationally more every day as the approach to food, particularly in the meat field. I think that's the reason it's the one that has been chosen by Canada. It's not that we have developed it and it's different. The United States is using that same process.

• 1210

With each industry it would be done and implemented in different ways. Basically, it removes the responsibility from the Food Inspection Agency to carry out all the inspection activities. It puts the onus on the industry to identify the risks and critical points in their process and to implement a process. The Food Inspection Agency can then come in and do an audit of that process on a periodic basis. In fact, it's putting the onus on industry to have a safe food supply. It can take various forms. It's a negotiated process that will work out what works best for that particular industry.

In terms of why it is not moving faster, there are arguments for and against. Canada has chosen to implement it on a voluntary basis. The United States has been more aggressively moving forward. Recently, there has been some push backwards in the United States in terms of legal concerns. I think that's one of the reasons Canada is moving slowly.

This is one area that perhaps goes back to an earlier question about more resources. If we moved faster in this regard, we would have a need for perhaps less inspectors in the federal system. More onus would be on industry, and that would take less resources and provide a safer food supply.

[Translation]

Mr. Yvon Charbonneau: And what about Brazilian beef?

[English]

Mr. Douglas Timmins: Pardon?

Ms. Maria Barrados: Brazilian beef.

[Translation]

Mr. Yvon Charbonneau: Was this program, or conversely the failure to implement the program, the reason for the decision to impose a moratorium, and for the subsequent reversal of this decision?

[English]

Mr. Douglas Timmins: The issue of Brazilian beef has more to do with the environment within Brazil, as opposed to the environment within Canada. It has more to do with being able to trace the source of animals in Brazil as to whether they go back to the U.K. The HACCP system deals primarily with meat we consume as food. The Brazilian beef and mad cow disease situation dealt with live animals. That is a separate program entirely under animal and plant health. That is also a responsibility of the Food Inspection Agency, but it was not the nature of this audit or this program.

[Translation]

Mr. Yvon Charbonneau: Thank you.

My second question concerns Chapter 15. Several of my colleagues have already raised the issue of the health of Firs Nations. Since 1997, a number of observations and suggestions have been made and criticisms leveled. However, the problem persists.

The Auditor General knows full well that serious attempts have been made to transfer responsibilities to First Nations and to their own organizations. It was felt at some point that it would be a good idea to make these communities accountable by entrusting them with responsibility for managing programs using their own resources.

On the one hand, the AG's remarks seem to suggest the need to clamp down further, to increase the number of inspectors, to conduct inquiries and to attempt to correct the problems ourselves within the federal administration. On the other hand, the basic philosophy that has been embraced is to help First Nations build up accountability.

Could you shed some light for us on ways in which first nations could build up accountability in this area? The problem will not be resolved by increasing the number of police officers or auditors in government. That's not a long-term solution. However, this doesn't mean that we should relax our monitoring efforts.

• 1215

Can you advise us on ways of improving the situation, provided of course you feel that this is a valid option?

[English]

Ms. Maria Barrados: There's no question that to make progress here we need to have a world where first nations take greater responsibility for their own services and activities. But with that comes accountability, and it's accountability both to the federal government and to their own people. It's those things together that have to be working. So it has to be transfer with accountability and accountability in two directions. We have done other work in this area, and we mentioned in an earlier report that there is a concern about capacity. Another concern that was discussed was described as “dump and run”, in that the desire to transfer did not worry about increasing capacity and the accountability side of the equation, if you like.

Some of these first nations are really quite small, and some of them don't have a great deal of experience. One of the other comments we make in the report is that some of the structures of the program we are imposing on first nations are not really realistic. We are asking for detailed contribution agreements for many different programs that have been designed by the federal government. They all get down to a few people in a first nations community. They're transferring the funds, and the funds are delivered with a common purpose. There are comments of that nature as well in the report.

The Chair: Thank you, Mr. Charbonneau.

Ms. Maria Barrados: Mr. Campbell, did you want to add something?

Mr. Ronnie Campbell: I would just point out, Madam Chair, that in the first chapter we did in 1997 there certainly was quite a degree of effort put forth by Health Canada to effect this transfer. One of the changes we noted in dealing with departmental officials when we did the recent chapter in 2000 was that they were now recognizing they may have underestimated the amount of work needed to help first nations take on those responsibilities and that they could have been more diligent in helping them through some of those reporting requirements. So it may have been there was quite a bit of pace associated with the transfer, and now the departmental officials are running into some difficulties. We saw it as quite encouraging that they now recognize they need to worry about the capacity of communities, and once they transfer responsibilities, they need to continue to work with the communities to make sure they are able to follow through.

The Chair: Thank you, Mr. Campbell.

Mr. Lunney, are you ready?

Mr. Yvon Charbonneau: May I, Madam Chair—

The Chair: You've actually gone about two minutes longer than the longest.

Mr. Yvon Charbonneau: If there is no other person—

The Chair: Yes, we have Mr. Lunney and Ms. Wasylycia-Leis.

Ms. Judy Wasylycia-Leis: There will still be time. We have lots of time.

Mr. James Lunney: Thank you, Madam Chair.

I will just pick up on Mr. Merrifield's comment on the xenotransplants. It's interesting that for pig and beef valves, which involve dead tissue, that's not a big concern. They seem to be working quite well, and we're thankful for that. But there have been reports of live pork cells being implanted in brains to try to help people with Parkinson's disease and so on. Of course, pigs have endogenous porcine retroviruses, AIDS-like viruses, which cause a very big concern. That is an area where the risk of disease jumping species is very great, and it's certainly an area of great concern. I'd just like to mention for the record that because regulations aren't in place, that is an area we should be watching with some concern, I think.

• 1220

Taking it on another track, though, with regard to GM technology and genetically modified foods and back to the Canadian Food Inspection Agency, as I understand it, about 10% of our potato crop is in GM potatoes. But scientifically they've established areas of refuge in the centre of these fields—10%, 20%, or 30% of the field—so that the insect will not become resistant too quickly to the pesticide that's in the potato and defeat the whole purpose of the program. So the purpose of that is to have a refuge area where they have traditional potato plants.

Anyway, as I understand it now, the insects that were the target in this particular instance have been flooding into the refuge areas at such alarming rates that the concern is that farmers are not given adequate training, or understanding, or instruction into how this program is supposed to work. When they found high numbers of these insects in their refuge areas, they either with or without permission—it seems unclear whether they had the permission of the Canadian Food Inspection Agency—actually sprayed the refuge areas, and of course out the window went the science in that particular instance.

So we don't know how widespread that is, but I know this was discussed at our conference of scientists recently in Guelph. It shows a really desperate need for some kind of further regulation in this area if the science is going to be held to be valid and risks are going to be minimized.

Getting around to my question here, though, I want to pick up on the Royal Society of Canada report that was tabled recently—in January, I believe. It was prepared at the request of Health Canada, the Canadian Food Inspection Agency, and Environment Canada. In their criteria for safety, they basically challenge the use of substantial equivalence as a criterion:

As a precautionary measure, the Panel recommends that the prospect of serious risks to human health, of extensive, irremediable disruptions to natural ecosystems, or of serious diminution of biodiversity, demand that the best scientific methods be employed to reduce the uncertainties with respect to these risks. Approval of products with these potentially serious risks should await the reduction of scientific uncertainty to minimum levels.

The society report, with a very prestigious panel of 14 scientists looking into this, raises some very serious issues, and I think that's something that your department, Health Canada, and the Canadian Food Inspection Agency are going to have to deal with. Would you be in a position to comment on that?

Ms. Maria Barrados: In consulting with my colleague, I don't think either of us are really in a position to comment on that report. We would comment on such a report if we had been doing audits and looking at that at the same time, but I haven't seen it.

Did you want to add something?

Mr. Douglas Timmins: Yes. It may be a report that we have seen, and I think there are some similarities in terms of the things we say in chapter 24 on the health and safety regulatory environment.

In particular, there is a recommendation in that chapter where we suggest more use of independent scientific advisory committees to assist government in areas in which they're carrying out risk assessment and establishing regulations. That would provide a better approach. It is being used in some cases, and we suggest that it be expanded. So I think that would be somewhat consistent with that kind of message.

Mr. James Lunney: Okay, thank you.

The Chair: Thank you.

[Translation]

Mr. Castonguay.

Mr. Jeannot Castonguay (Madawaska—Restigouche, Lib.): Thank you, Madam Chair. And thank you as well for coming.

I listened to your presentation and noted that in the summary to Chapter 20 of the 1999 report, you broach the subject of the Canada Health and Social Transfer. You stated that the federal government does not know exactly what proportion of the funds allocated to provinces or territories goes to health care, which means that Parliament and the general public are in the dark on the issue of health care funding.

I have to say, Madam Chair, that in New Brunswick and specifically in Madawaska-Restigouche, I'm hearing exactly the same concerns from health care and post-secondary education workers. They argue that they ultimately do not know how transfer payments are used and that the province does not account for the use of these funds.

Madam Chair, we hear mention of indicators that would let us know what the provinces do with federal transfers. I'm wondering, however, if there might not be a simpler, more cost-effective approach to dealing with this situation. These transfer payments could be targeted initially for health, post-secondary education and social programs. Wouldn't this make your job easier? In turn, it would be easier for the public to see where these substantial sums of money are being spent.

• 1225

I would appreciate your comments.

[English]

The Chair: This is a little beyond the realm of the Auditor General. This is more about the art of governance in Canada. In any case—

[Translation]

Mr. Jeannot Castonguay: Madam Chair, these Canadian citizens are at least entitled to their opinions. They've been working so long in this field that surely they are entitled to an opinion. I'd like to hear it, if you have no objections.

[English]

Ms. Maria Barrados: This is a very politically sensitive question. As you know, the regime that was in place up until 1996 did separate out the transfer, so you could see how much went to health, how much to post-secondary education, and how much to social services. In its negotiations with the provinces the federal government went for a block transfer that gave them more flexibility. As we describe in the chapter, the officials, certainly those in the Department of Finance, did not feel it was reasonable to go back on that arrangement.

Our suggestion was that if you leave that arrangement alone, at a minimum you can say from the federal side that this is how we think of it. You could have a discussion that would allow Canadians to know what the federal contribution really is. What people are doing now to estimate that contribution is to project the proportions we had in the past, but there's nothing that says that's really what the federal government sees going toward health. Even the last new announcement isn't specifically tied to health.

[Translation]

Mr. Jeannot Castonguay: If this approach were embraced, would that make it much easier to be accountable to you?

Ms. Maria Barrados: Obviously, it's not simple. It makes the situation much more difficult, but that is a reflection of the Canadian reality.

Mr. Jeannot Castonguay: Thank you, Madam Chair.

[English]

The Chair: Ms. Wasylycia-Leis.

Ms. Judy Wasylycia-Leis: Thank you, Mr. Chairperson.

I'd like to ask just a couple of questions on the reports you've done on food safety, starting with the question of accountability. There's been some difficulty in terms of whether or not the health committee, the health field, or the policy field is involved at all in the Canadian Food Inspection Agency and in aspects pertaining to food safety, GMO regulations, beef safety, and so on.

Is the Canadian Food Inspection Agency accountable to the Minister of Health? If it is, on what basis is it accountable to the Minister of Health?

Ms. Maria Barrados: I'll start, and then I'll get Mr. Timmins to add to that.

The accountability relationship of the Food Agency is through the Minister of Agriculture. The budgets, the estimates, and the performance reports go through the Minister of Agriculture's office. There is a responsibility of the Minister of Health to set standards and perform audits to ensure there is adherence to standards—in other words, on the policy side and the enforcement of the policy side. So there's a limited responsibility for the Minister of Health.

There is a lot of discussion on whether this maximizes the relationship, but that's the situation.

Mr. Douglas Timmins: I think that answer's complete. I've nothing to add.

Ms. Judy Wasylycia-Leis: This came up—for me, at least—as a difficulty when we had departmental officials before the committee and tried to pursue information based on what I thought was a request for the standards set by Health Canada pursuant to beef and food safety. For example, a question was what is the response by Health Canada to the World Health Organization's recommendation for a ban on feeding animal-based feed to animals raised for meat. We were told that this was something Health Canada officials couldn't answer, and that they would go back to the Canadian Food Inspection Agency and we might get a response or not.

• 1230

Could we not expect that on standards issues, on basic questions about standards in this whole area, we could get an answer through Health Canada officials?

Ms. Maria Barrados: It's my understanding that this is their responsibility.

I haven't looked at that area in detail. There are clearly going to be divisions between where you set the standard and the general policy, and how you implement and how you develop the regulations. Because you go from a general policy level, which may be quite general, to specific regulation and implementation, which would be on the side of the CFIA.

Mr. Douglas Timmins: I think I would just add, Madam Chair, that I think there is a difference.

Health Canada's normal role is in human health, so if you're talking about what goes into feed that's fed to animals, you have to demonstrate that there's a connectivity, and a link and a risk to human health before Health Canada, at least in my understanding, would become concerned.

So in terms of the role of the regulation of animal feed, yes, I believe it is the food agency that plays that role. They have restricted things like certain parts of other animals, of animal carcasses, being fed through the food chain, but it's their role in deciding that. I don't think Health Canada are the right people to answer specifically on that particular point.

Ms. Judy Wasylycia-Leis: In the context though of something as serious as mad cow disease, where there are links between ruminants being fed to live animals, and possibly then leading to something as serious as mad cow disease, shouldn't we expect Health Canada to be involved in setting standards? And shouldn't they be able to provide us with some assurances that certain standards are being met in the whole way in which animals are being raised and fed from the point of view of human health and safety?

Mr. Douglas Timmins: Madam Chair, I think that's more a question you might want to ask Health Canada. If they can make the absolute connection, then I think they have the ability now to set certain standards.

However, I think equally in government, if we have one agency that has been clearly given responsibility, it's up to them to carry it out. I don't think that prohibits you from calling that agency to discuss the particular issue with that agency.

So I'm not sure that Health Canada necessarily has to have a role in it. If clear responsibilities have been established, then it's more a matter of whether the agency is carrying out their responsibility in that regard.

The Chair: Ms. Wasylycia-Leis, I think you've identified a gap that concerns us all. I would remind you that we do have the Food Inspection Agency coming, and perhaps you would like us to try to get some Health Canada officials here at the same time. Because it seems like there's a gap, and neither is claiming responsibility for it. Yet you have explained quite clearly to all of us the connection to Health Canada.

Could we save that line of questioning now for next week, and you get on to your next question?

Ms. Judy Wasylycia-Leis: I have a related question, although I won't belabour that point.

You've never commented on something that a number of health organizations have raised publicly. That is, when you have that kind of split responsibility or division between Health Canada and Agriculture Canada, and you have that dual mandate on the part of the CFIA, does it not inevitably lead to problems in terms of there not being one clear authority responsible for human health? I just sense that we're into that problem.

I'm wondering why you've never commented on that or made recommendations in terms of trying to separate functions so that anything to do with human health is the Minister of Health's responsibility, so that nobody can pass the buck and nobody can dodge the questions and there is some absolute accountability.

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Ms. Maria Barrados: We are quite cautious about making machinery of government types of recommendations, because—going back to some of the earlier questions—we don't really see that as our mandate. However, every now and then when we run into something that really bothers us we do tend to say something. And we were quite frustrated by the old division of how food safety was being handled prior to the CFIA, because at one point it was Health Canada, Consumer and Corporate Affairs, Fisheries and Oceans, and Agriculture Canada, and it wasn't very workable to have all those different players. So we were encouraged when CFIA was put together, because it was a streamlining of something that was very cumbersome.

We haven't made any comments specifically about the structure of CFIA and Health Canada now, except to say that it's a system that could work and Health Canada is clearly responsible for health issues, and the minister remains responsible under the Food and Drugs Act.

It would be perhaps a good question to the minister as to how he sees he can discharge his responsibility under this arrangement.

Did you want to add to that, Doug?

The Chair: Thank you.

Mr. Charbonneau, again, and then Mr. Owen. Did you want another go, Judy? Okay.

[Translation]

Mr. Yvon Charbonneau: I simply have a comment to make regarding the same issue.

I'm certain that Health Canada would appreciate your advising it as to whether the current system has some shortcomings or whether there is room for improvement. We want your advice. Of course you are reluctant to call into question constantly structures and divisions of responsibilities. I can understand that. This is a relative new approach. However, if you already find it difficult to do your audit work—sometimes it's difficult for us to do our own job—because things are not clear enough, feel free to make suggestions to us.

Getting back to my question concerning the health of aboriginal peoples, your audit activities bring you in contact with all departments. Government wide, some $6 or $7 billion are transferred to aboriginal communities. In the health field, the figure totals over $1 billion.

Putting things into perspective, would you say that the problems identified in the health field are exceptional compared to the problems encountered in other departments? Or, are the problems encountered by all departments somewhat similar in terms of transfers to aboriginal peoples? Do the particular problems you have identified fall within the average range or are these health- related problems truly exceptions?

[English]

Ms. Maria Barrados: First, on your suggestions on CFIA, I'm not sure I have a great deal I can add to that.

[Translation]

Mr. Yvon Charbonneau: We'll address this issue again later.

[English]

Ms. Maria Barrados: With respect to the first nations and whether the problems were unique to Health Canada, a number of the problems that we've identified in terms of the management of the transfer agreements, the management of the grants and contributions, are similar to the observations that we have made in the Department of Indian Affairs and Northern Development, and as you know, we have been concerned across government about the management of grants and contributions. So it has not only an element that is of concern to first nations, but also of concern government-wide.

On the issue of the particular non-insured health services that are being provided—the drugs, the dental, and the transportation—those areas are unique to Health Canada and there isn't anything directly comparable, so those comments stand on their own in terms of the delivery of those services.

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[Translation]

Mr. Yvon Charbonneau: I'd like to close by making a request. Could the Auditor General, at some point, try to help us move beyond this stage? I realize he already tries by making certain recommendations. However, the problem is rather general and it's possible, Madam Chair, that we will still be hearing about it in ten years' time. We'll hear how the problem was addressed in 1997, in 2000 and in 2002, but that given its complexity, ten years later, it remains unresolved. Perhaps a special effort is required. In an event, I'm asking for your advice as a Member who wants to move forward on this issue.

I'm also asking for your help in getting the government to break the impasse you referred to earlier and to overcome the problem communities have encountered in assuming responsibility. We would also appreciate your advice on ways the government could produce programs that are compatible with the needs of these communities. It's not always easy to achieve this balance. If you could perhaps formulate a series of specific recommendations, this might help the government move to the next stage in the coming years. At least I hope it might. Thank you very much.

[English]

The Chair: Thank you, Mr. Charbonneau.

Ms. Maria Barrados: It's the kind of thing we are trying to do. We have done some reorganization in our own office and we have put the people who are responsible for accountability and performance measurement issues at the Department of Indian Affairs and Health Canada together. That should help.

The Chair: Thank you very much.

Mr. Lunney.

Mr. James Lunney: I want to pick up on another thing you mentioned earlier, in number 25 of your remarks, about the Patented Medicine Prices Review Board.

In view of the skyrocketing costs of drugs and medications, comments here in your report talk about a real problem in determining fair value for drugs, concerns that in 20% of the cases the only country using the drug or drugs in question is the U.S. That's the practice of comparing to seven other countries, I imagine. Usually that turns out to be the U.S. as the primary one, and that's where the costs are the highest.

I know you've raised concerns about some really exorbitant examples of very high costs of drugs that clearly were out of order and yet action wasn't taken. It says basically that the guidelines were not being followed or adhered to.

I see that you've made reference that you're going to be commenting on this in your report in December. Is there anything you can tell us at this time as to whether there's been any improvement in managing the Patented Medicine Prices Review Board?

Ms. Maria Barrados: No, that work has just started, and our usual process in doing that work is to go through all the recommendations, and some key observations as well, and we ask the officials in the board to comment and then we go through and we check.

In the piece of work we did, there is a lot that is not really all that clear. It's a complicated area, because it's an area where the legislation itself is in the patent legislation, which is the responsibility of the Minister of Industry, but there's a small portion that goes to Health Canada. The amount of regulation they do is actually fairly restrictive, dealing with patented medicine. There are other medicines that fall outside of that, of course, where there is no regulation.

We do observe, though, that although we found areas we thought there was need to strengthen and there were some areas where there was a lack of clarity, actually, in the legislation that led to some of these anomalies, most patented drug prices do comply with the board's guidelines. We looked at outliers, obviously, and we made some comments, but most of them do comply.

Mr. James Lunney: Thank you.

The Chair: Mr. Owen.

Mr. Stephen Owen (Vancouver Quadra, Lib.): Thank you, Ms. Barrados and senior colleagues. Thank you very much for appearing today.

My question is of a more general nature and relates to the process of general auditing, particularly around your comprehensive or special or value-for-money audits rather than pure financial audits. Your work is primarily about accountability, and to try to measure the degree to which, through your work, government is held accountable to the public I think it's necessary to look at relationships. And relationships are developed through process, so my question really goes to your process in terms of both the accuracy of the conclusions you come to and the responsiveness of government to those recommendations.

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I'm interested to know.... In your process of these special audits, I understand that you take a multidisciplinary approach, as you've described, but I'm wondering about the process of interaction. How responsive is government to your investigations or audits in the first place? How does your communication proceed throughout the process of an audit in the sense of you sharing information and concerns with the agency or the department as you go? Do they in fact adjust their practices and processes during the process, and because of that, in an organic way, your process of review, rather than simply waiting until some later date, when you have a formal report that's before Parliament? It's a question of relationships.

Let me suggest an answer I think would be disturbing, and that is that you hold everything close to your vest, go through a lengthy process, and then surprise the government with a public report. I think that would be at one scale of inappropriateness and ineffectiveness. On the other hand, the best process would likely be a full testing of ideas, exchange of information, and immediate reaction to issues that were identified of real importance and agreed upon to be of real importance.

So if you could just give me some idea of how that process proceeds, it might help us understand the effectiveness of the whole accountability exercise.

Ms. Maria Barrados: I'll try to keep this brief, because we have a lot of processes.

We share our plans with the departments that we audit. In many instances we sit as observers on the audit and evaluation committees of the departments. That allows us to present our plans to them and to discuss our plans. It also allows us to see what the department is doing, because we seek to rely on the work of internal audit. We are not that large and we don't want to duplicate.

So once we have decided to do a specific audit, we start to make sure the people we're auditing understand what we're trying to accomplish, and that there is a general comfort with our criteria or the standard that we are using to assess them against. If there is a disagreement on the standard, it has to be reflected in our report so members of Parliament can see if our yardstick was different from the government's yardstick.

Throughout the audit process, there is a lot of discussion, with some exceptions. If we think there's fraud, we will behave differently or we will refer it to the RCMP. But that's the exception rather than the rule.

During the course of our work, our auditors strive to work independently, to come to their independent judgments, but there's a lot of discussion with officials as they complete their work. Our auditors do debriefings as they leave. If they've been working in a regional office, they will debrief with people in the regional office. This is done for two reasons. One is to check their own accuracy of what they have done, because they come from outside and they may have missed something. The other part of it is to inform the officials of what they have found.

The actual findings then get put together, and as they get put together, there is more discussion with departments. A lot of formal discussion takes place within our side to make sure these things are reviewed and that the office is comfortable with the positions. The report is then sent to the ministries as a formal report, and we go through a process where we ask officials to confirm the facts. We do not expect to have differences of facts in these reports. If there's an issue of fact, we want to be shown the information and we will change things. We want our view of the facts and the officials' view of the facts to be the same.

If there is a difference of interpretation, we ask officials to identify that as well. In that case, we reflect it in the report. We've talked about some of those cases today—instances where we did not agree on an interpretation of the facts. The departments are then given the opportunity to respond to the recommendations in the reports themselves.

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In most cases, I think most senior officials would characterize us as being essential to the accountability processes. Nobody really likes direct close scrutiny of themselves, but that's very human.

Mr. Stephen Owen: Thank you. That's a great help.

The Chair: Ms. Wasylycia-Leis—and this will be the last question.

Ms. Judy Wasylycia-Leis: I just have a couple of very brief questions.

Would it be fair to say that where you've had the most difficulty in getting cooperation from departmental officials—and I think this was hinted at in your report—is at the Canadian Food Inspection Agency?

Ms. Maria Barrados: That's correct.

The report is one specific report on the management of a food-borne disease outbreak. We have a paragraph in that report that is an unusual paragraph for us to put in the report. That paragraph essentially says we did not get the information we were seeking in a timely manner, and that we did not have the confidence we usually have that we have all the information to present in the report.

Ms. Judy Wasylycia-Leis: Have you had a response from the minister, the government, or the department, based on that observation? Do you feel it's being addressed in any way?

Ms. Maria Barrados: As a follow-up to this, I did explain to the head of the CFIA what my specific concerns were and what was underlying these statements in the report. While recognizing that things may not have been perfect, the head of the agency didn't really agree with me.

Ms. Judy Wasylycia-Leis: They didn't really agree with you?

Ms. Maria Barrados: No.

Ms. Judy Wasylycia-Leis: A similar, clear paragraph is not in chapter 25, your latest report, but you hint at ongoing problems in terms of getting full cooperation and responsiveness from officials with the Canadian Food Inspection Agency. Is it fair to state there's an ongoing problem there that needs to be addressed, and should we be looking at ways to follow that up in Parliament?

Ms. Maria Barrados: Mr. Timmins was responsible for that audit, so I'll let him speak to that.

Mr. Douglas Timmins: No, I would not characterize that we would say we had difficulty of access in doing the work we did in chapter 25.

Going back to the previous question, I think we certainly had a series of long discussions with the agency in terms of both our criteria, our findings, and so on. They take the issues very seriously, challenge us on every point, and may not agree with us on every point, as we had said in terms of the response to the recommendations. But in general, at the end of the day, with the one exception, they acknowledged that the other recommendations were valid and are saying they will take action. But we didn't have any access problems in terms of the information.

Ms. Judy Wasylycia-Leis: With respect to the first nations issues, officials clarified this for us at a recent meeting. As you know, there are a couple of audits under way, one of the Virginia Fontaine treatment centre itself, and one of Health Canada officials pursuant to allegations relating to the Virginia Fontaine treatment centre. Have you been involved? Have you been asked for your advice? What advice would you have for our committee in terms of monitoring and pursuing recommendations that flow from those audits?

Ms. Maria Barrados: Madam Chair, there were some discussions with the officials in the department on audit methodology. I was away and wasn't part of those discussions, but Mr. Campbell was.

Do you want to add anything to the nature of those discussions?

Mr. Ronnie Campbell: I'd only say, Madame Chair, that we had discussions in terms of methodology, criteria, and objectives. It was a quite short discussion. Internal audit within the department has its job to do, and, as Madam Barrados had mentioned before, we strive not to get in each other's way and to duplicate. These are matters that certainly come within the purview of their auditors. So we're aware those audits are under way, but we're not participating in them.

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Ms. Maria Barrados: With respect to the last question, about how to proceed, my recommendation would be that if there is an interest on the part of the committee, you should ask the officials to come in to speak about those audits.

Ms. Judy Wasylycia-Leis: My last question is really just a frustration. You've addressed it in part over the course of the last couple of hours. It seems to me that where there has been a huge failing is where you make recommendations on something—the case of first nations and Inuit health, for example—and the recommendations never seem to get acted on on a timely basis, to the point at which huge problems occur and things are beyond our control.

I know you've said to ask you more questions and to put in written questions, but sometimes we don't get the answers. Sometimes it seems we're just getting the wool pulled over our eyes, especially in the case of first nations health. Every time we've raised it, we get pointed to new accountability frameworks and new methods of accounting within the department. It all seems to be around process and around new systems for problems that could have been addressed all along. I still come back to that issue.

In the case of Virginia Fontaine, there are clear provisions within the department to actually work with the first nations community when problems are identified, and to do follow-up audits and work in collaboration. Yet it would seem that in a case like this, from the time you did your first audit in 1997 to the time when a new five-year $7.2-million agreement was signed, there were no actions taken. You did your follow-up in the fall of 2000. By then, it was almost too late—and this is no criticism of your office, it's a frustration with none of us acting in time. So I'm just trying to get some last-minute advice from you in terms of how we can do our jobs more effectively so this doesn't keep happening.

Ms. Maria Barrados: Madam Chair, we at the Office of the Auditor General are very persistent. We will keep going back.

We also welcome input from members in terms of areas they feel are of particular importance and that we would include in our audit. If there is any kind of an input or interest from the committee, we welcome that kind of thing.

Specifically, in terms of dealing with first nations health issues, this committee did hear from us.

Were we here with the department, or were we alone?

Mr. Ronnie Campbell: We were here separately.

Ms. Maria Barrados: We appeared alone. At the public accounts committee, we tend to go with the department, but we'd appear here in either form, whatever you find useful. That may be a way to address those questions in greater detail.

The Chair: Thank you.

Ms. Judy Wasylycia-Leis: That was in 1997, right?

A voice: Yes.

The Chair: Thank you very much.

I'd first like to thank my colleagues for their very thoughtful questions, which I thought ranged across the spectrum, from art, to science, and into the dark arts of governance, particularly in a federal state.

I'd also like to thank our guests, who were forthright and commented on the details of what it is they do, but also stuck their necks out a bit and told us their opinions about some of the major issues of trying to govern this country.

So thank you very much for being so open. We welcome your offer to come back, and I think I can assure you that probably you will have another invitation.

Thank you very much, ladies and gentlemen.

This meeting is now adjourned.