PACC Committee Report

Some of this additional funding will be used to renew internal audit communities within departments through recruitment, training, and retention of professional resources. The new policy gives the Centre of Excellence for Internal Audit the responsibility for developing a human resource strategy for the internal audit community in order to assist departments in this regard.

The Committee is concerned that the internal audit function has had significant reductions in its funding and wants it to be given sufficient financial and human resources to ensure that it can accomplish its mandate effectively. While additional funding and efforts to rebuild capacity are welcome, it is too early to tell whether this new support is adequate. The Committee therefore recommends:

RECOMMENDATION 8

That Treasury Board Secretariat regularly review the level of funding allocated to the internal audit function in departments and agencies to ensure that the function maintains its capacity to fulfill requirements set forth in the Policy on Internal Audit. Any identified deficiencies in levels of funding must be reported in Treasury Board Secretariat’s annual Performance Report.

Evaluation

Mr. Desautels indicated that the new Evaluation Policy represents an “encouraging and timely” move in the direction of rebuilding the Government’s evaluation function. He commented, however, that evaluating and reporting on significant aspects of government “continue to be key challenges.” Previous audits have shown that evaluations tend to deal with minor, less costly, aspects of government activity. In 1996, for example, the Auditor General reported that evaluations continued to address the needs of departmental managers and “[did] not always provide needed information on matters of broad government policy and broad expenditure allocation and [were] not always useful for accountability to Parliament.”[1]

Mr. Neville did not fully clarify whether the new policy would correct this tendency. He indicated that the new policy “reflects the repositioning of the function closer to the needs of management,” which suggests that the tendency of evaluations to focus on day-to-day operational issues of interest to managers will be reinforced. Yet Mr. Neville also testified that the new policy:

Broadens the scope of evaluation beyond that of programs to include policies and initiatives and extends evaluation beyond a single department to include programs, policies, and initiatives involving partners outside the department.

Both approaches are reflected throughout the new policy where senior departmental managers and evaluators are instructed to develop strategic plans that take into account departmental priorities and priorities of the Government as a whole. The introduction to the evaluation standards included with the policy draws attention to the increasingly complex delivery of programs and initiatives when it refers to:

Evaluation in an environment, where policies, programs and initiatives often involve partnerships with other federal organizations, with other levels of government or with the private sector or not-for-profit sectors.

The policy thus expects departments to draw up evaluation plans based on their own priorities and those of government as a whole, yet these potentially encompass activities delivered through a diverse combination of partnership arrangements. While departments may do well in designing evaluations suited to their own needs, the evaluation of programs and initiatives central to larger government priorities and delivered by multiple partners will require some central leadership and direction. If such direction is not forthcoming, then it is quite possible that evaluations will continue to focus almost exclusively on operational issues and minor activities and not touch on the strategic and horizontal issues that are of interest to government as a whole and to Parliament. The Committee therefore strongly recommends:

RECOMMENDATION 9

That Treasury Board Secretariat develop a clear, annual statement of specific government evaluation priorities that addresses strategic and horizontal issues and make that statement available to departmental evaluation units and to Parliament in its annual report on the implementation of results-based management in the federal government (Managing for Results), beginning in the fiscal year ending 31 March 2002.

Government and Parliament need to know how well departments are aligning their evaluation plans with government-wide priorities. The Committee accordingly recommends:

RECOMMENDATION 10

That Treasury Board Secretariat develop a mechanism for assessing departmental evaluation plans and analyses against government-wide priorities and begin to report the results to Parliament in its annual report on the implementation of results-based management in the federal government (Managing for Results) beginning in the fiscal year ending 31 March 2002.

In Chapter 19 of his December 2000 Report to Parliament (Reporting Performance to Parliament), the Auditor General indicated that a small number of departments were including results of evaluations in their performance reports. He noted that when this information was provided, it was often useful and recommended that departments include relevant evaluation plans in their reports on plans and priorities and evaluation findings in their performance reports.

When asked whether Treasury Board Secretariat agreed with this recommendation, Mr. Coulter responded that the Secretariat is in agreement “in a general way.” He explained that the Secretariat wanted first to work with departments on their evaluation plans and then examine how to integrate plans and evaluation findings into the reporting structure. These are steps in the right direction. The Committee recommends: