PACC Committee Report

RECOMMENDATION 5

That the base budget of the Office of the Auditor General of Canada be immediately increased by an amount that is sufficient for the Office to be able to perform all duties that are imposed by statute or as are required by Parliament..

The Committee also learned that the Office is having difficulty resolving the issue of pay equity because it must obtain authority from Treasury Board to negotiate with its employees. Both the pay equity and funding issues relate to the manner in which the Office is allocated the resources it needs. Under the current arrangement the Office of the Auditor General must negotiate its funding with Treasury Board Secretariat, a central agency of government whose activities it also audits. This prompted former Auditor General Denis Desautels to comment in his “capstone” report that:

At present, the Office's budget is negotiated with officials of the Treasury Board. Although this has not yet done any harm, I believe it is an uncomfortable arrangement. It could lead to unwarranted pressure on the Office and result in the withholding of necessary funds. In addition, the Office needs to have more administrative autonomy in the areas of staff remuneration and collective agreements.[1]

Mr. Desautels added that in the United Kingdom the budget for the audit office is set by recommendation of an all-party committee of Members of Parliament to the government. He argued that this “puts the budgetary decision where it rightly belongs —with the Members of Parliament to whom the Auditor General is responsible — rather than with public servants.”[2] Ms. Fraser supported this general approach in her testimony.

While the Committee is not prepared, at this stage, to endorse a specific model of funding arrangement, it does believe that the current one is unsatisfactory and needs replacement. The Committee also notes the frustrations of the Office over its inability to resolve the pay equity issue without having to negotiate this issue with Treasury Board Secretariat. Under current circumstances, the Office of the Auditor General does not have the mandate from Treasury Board Secretariat to negotiate pay equity. A more flexible arrangement might allow the Office to solve this problem in a more efficient and satisfactory manner. Therefore, in order to ensure the continued independence of the Office of the Auditor General of Canada and to ensure that its funding arrangements function in an efficient and reliable manner, the Committee recommends:

RECOMMENDATION 6

That the current funding arrangements for the Office of the Auditor General be subject to review by a standing committee of the House of Commons during the current session of this Parliament.

Departmental Performance Reports

As indicated in the introduction to this report, the Committee strongly advocates departmental performance reports as a means of informing Parliament of how well departments and agencies are fulfilling their mandates. These reports, properly done, provide parliamentarians with key information needed to hold departments and agencies to account.

In contrast, however, to the enormous potential they represent, performance reports have been a disappointment. Departments and agencies tend to report activities rather than results, and to avoid mention of unfulfilled expectations and of any corrective measures they may have taken. Parliament is thus not fully informed and is deprived of an opportunity to make its views known.

The Office of the Auditor General has conducted a review of the departmental performance reports of 47 departments and agencies and reported the results in chapter 19 of its December 2000 Report (Reporting Performance to Parliament: Progress Too Slow). The Committee also notes that the Office has indicated, in its Report on Plans and Priorities, that it intends to assess the fairness and reliability of the Performance Report of the Canada Customs and Revenue Agency. The Committee would like the Office to continue its evaluation of departmental performance reports, but in greater depth. The Committee notes that the Interim Auditor General agreed that this was possible and accordingly recommends:

RECOMMENDATION 7

That the Office of the Auditor General conduct random audits of the information contained in the performance reports of departments and agencies in order to verify, among other things, that the information contained in these reports is a fair representation of accomplishments against goals and objectives.

The Committee notes that senior management of departments and agencies is required to include a statement, in their annual reports on plans and priorities, to the effect that the information contained in them is, among other things:

·        Comprehensive and accurate, and

·        Based on sound underlying information and management systems.

They are furthermore required to indicate their satisfaction with the quality assurance processes and procedures that have been used for the production of the report.

Senior management is not required to provide similar assurance with regard to the content of their department’s performance reports. The Committee believes that a requirement to include such assurance might strengthen the credibility of performance reports generally and lead to an improvement in their contents. It therefore recommends: