PACP Committee Report

THE SPONSORSHIP PROGRAM: HOW MINISTERS AND THE DEPUTY MINISTER UNDERSTOOD THEIR RESPONSIBILITIES

During its examination of the Sponsorship Program, the Committee gave particular consideration to the conduct of ministers of Public Works and Government Services Canada (PWGSC) the Hon. Diane Marleau and the Hon. Alfonso Gagliano, and Deputy Minister (of PWGSC) Ranald Quail. They were the decision makers directly associated with the Sponsorship Program during the period covered by the November 2003 report of the Auditor General. However, in testimony provided to the Committee under oath and which the Committee accepts as having been given in good faith, none of these individuals accepted responsibility for the problems identified by the Auditor General.

Clearly, there was a breakdown in the process of democratic accountability that the doctrine of ministerial responsibility is intended to achieve. It requires careful reflection, however, in order to determine whether the problem lies with the people whose conduct should reflect the doctrine, or the doctrine itself. Did one or more of these individuals fail to meet requirements of a doctrine that continues to be clear and reasonable, or does their conduct suggest that the doctrine is itself unclear or impractical and needs to be revised?

The Ministers

As the doctrine of ministerial responsibility requires, ministers Marleau and Gagliano accepted responsibility for their role in providing the policy direction embodied in the Sponsorship Program, and continued to affirm their belief in the importance of government efforts to make the federal presence more visible in Quebec in the wake of the 1995 referendum.

Support for the Program

Appearing before the Committee on 25 March 2004, Mrs. Marleau declared:

I will confirm that I did sign off on a Treasury Board submission with the Prime Minister in November 1996 to provide the moneys necessary to promote the Canadian identity. I still believe, as I did then, in the importance of ensuring that Canadians know the ongoing role the government plays in their day-to-day lives. (15:1205) [*]

Mr. Gagliano also confirmed his support for the continued operation of the program, although his comments to the Committee focussed primarily on the limitations that face ministers as they exercise their responsibilities in complex portfolios and stressed that the program had been “inherited” (i.e., operational when he took office):

The objective of the program was very good. It was, yes, to keep the country united. It was a national unity strategy … . (10:1025) [*]

General Direction and Management

Given the priority attached to national unity issues during this period, and the general responsibility of ministers for providing management and direction, it is understandable that the ministers did more than provide a general green light to the department concerning the Sponsorship Program and move on to other issues. They sought to ensure that the objectives of the program were being realized.

After signing off on the Treasury Board submission that sought initial funding to establish the program, the Hon. Diane Marleau relied centrally on the delegation of authority to departmental officials. According to her testimony, she was approached by the Executive Director of the program, then Mr. Charles Guité, for direct input and instructed him to report through the departmental hierarchy. (15:1220) [*] In addition, the Committee has received testimony from departmental officials indicating that during Mrs. Marleau’s tenure as minister Mr. Guité was provided with political direction from the Prime Minister’s Office (primarily from Mr. Pelletier), although Mrs. Marleau denied that she was aware of this relationship. (15:1225) [*]

Mr. Gagliano appears to have been much more closely involved with the program, according to his own summary of his role:

TOP OF PAGE

I can summarize my activities in relation to the Sponsorship Program thus: when told there was a problem, I tried to fix it; when not told, I was powerless. …

More particularly, in the case of the Sponsorship Programs, what I did was as follows:

Inherit the communications program, as it had been entrusted to the Minister of Public Works on June 23, 1994 by decision of the Treasury Board and reviewed on at least two occasions by the Treasury Board; …

Upon my arrival at the head of the Public Works department, in 1997, I reviewed and followed the recommendations of the Secretariat of the Treasury Board; these included the redirection of the procurement process within the department.

I witnessed the organization of the Communications Coordination Services Branch; this organization was made necessary by the privatization of the Canada Communication Group, leaving a number of orphan programs in various departments; it was government policy that communications be reunited under a single responsible authority.

In August 1998, I signed a submission to Treasury Board to create the position of Assistant Deputy Minister, Government of Canada, Communications Coordination Services, to assist me in my capacity of Chair of the Cabinet Committee on Communications; this submission was approved in September.

I directed an audit of the management of sponsorship at the Communications Coordination Services Branch, which resulted in the report of August 31, 2000, of which the key finding leads as follows:

The selection process adopted by CCSB officials to select communications firms and distribution agencies did not comply with the spirit or letter of the rules and directives established by Treasury Board.

Following the presentation of that report, I asked the Auditor whether I should call the police but I was told that the nature of the problems was administrative, not criminal; I immediately ordered a halt to the Sponsorship Program until a new management action plan was devised and put in place.

The new management action plan was put in place at the end of 2000 or the beginning of 2001; new communications firms were chosen after a new competition had taken place and the program was started again, following Treasury Board guidelines.

In 2001, the Ethics Counsellor, whom I had asked to review the matter of some of the advertisement contracts that had been given to Groupaction and Groupe Everest, issued a report in which he concluded that I had not participated in the awarding of those contracts, but merely approved the recommendation of the selection committee to comply with the signing authority requirements.

In the same year, I combined the Canada Information Office and the Communications Coordination Services Branch in Communications Canada. I did this because I wanted to separate the people running the programs from those awarding the contracts; effectively, this was an attempt to put things back in the state in which they had been prior to 1994. (10:0930) [*]

Operational Involvement

In addition to providing general policy direction, a minister may undertake to discharge his or her responsibilities by becoming directly involved in individual decisions that arise within a program or activity. The absence of value for money based decision-making criteria and other specific sponsorship selection guidelines, noted by the Auditor General and confirmed by the testimony detailed in the Committee’s Ninth Report, would have increased the likelihood of operational involvement by the minister and the minister’s office. This is because a minister responding to the perceived importance of the file by seeking to provide specific operational direction would have had no basis to do so, other than by becoming involved in the consideration of individual sponsorship decisions.

Mrs. Marleau does not appear to have been involved at the operational level. However, both Mr. Gagliano and officials involved in the Sponsorship Program during his tenure as minister have testified that the minister and his office were involved in considering individual sponsorship events (although, it was claimed, not in the selection of the agencies to which the sponsorship funding was given). In Mr. Gagliano’s words:

In terms of directions I gave, I think I was clear yesterday — yes, directions on policy. The policy was that we had to have timely visibility. We were talking about sports events, festivals — activities that happen in a timely fashion. We were also living in a very competitive environment, because the Government of Quebec of the time didn’t want us as the federal government to be anywhere in Quebec. But I only gave policy direction. Yes, we discussed events, but I never got involved in the contracting or management of the agencies — that was the bureaucrats. (11:0955) [*]

A somewhat different portrait of the nature of this involvement emerged from the testimony of officials. For example, an employee during Mr. Tremblay’s period as Executive Director (he succeeded Mr. Guité) told the Committee:

I remember on a few occasions Mr. Tremblay voicing his opinion in the office that the minister’s office would not let us do our jobs, that they were quite frequently interfering in the day-to-day operations of the Sponsorship Program. (15:0955) [*]

TOP OF PAGE

The Findings of the Auditor General

With respect to the issues uncovered by internal audits and the November 2003 report of the Auditor General, both Mrs. Marleau and Mr. Gagliano declined to accept responsibility. Both ministers made it clear that they relied, implicitly, on departmental officials to implement their policy direction according to the process requirements established within the Department and Treasury Board, as well as requirements of the Financial Administration Act and other legislation.

Mrs. Marleau advised the Committee as follows:

Upon my arrival at the Department of Public Works and Government Services, I made it clear to departmental officials that under my watch all protocols and rules to control expenditures and ensure transparency would be followed. Because integrity was the foundation on which I ran my departments, when I had departments, I’m proud of my record of achievements. (15:1205) [*]

In the words of Mr. Gagliano:

… if you look at the cabinet documents that you have before you, there is always a mention that those moneys were supposed to be spent according to the Financial Administration Act and the Treasury Board guidelines. Nobody ever gave instruction to anybody not to do the things that were supposed to be done. (10:1025) [*]

I was relying on the deputy minister to be watching. Really, the department is run by the deputy minister.

If I can give you a very simple comparison, a minister is like the chairman of a board and the deputy minister is the CEO. (10:1200) [*]

Mr. Gagliano also stressed his responsiveness to the responsibility of ministers to take action when problems are discovered: “So yes, there were problems. But when we found out there were those problems, we took immediate action, and they were corrected. That’s the role of a minister. You cannot correct something you’re not aware of.” (10:1005) [*]

The Deputy Minister

Deputy ministers have a two-fold responsibility. First, they are generally responsible for providing advice and responding to the direction of the minister to whom they report and the Prime Minister, who is responsible for the appointment. Second, there is a range of more specific statutory responsibilities, including those outlined below.

Given that Mr. Quail, the deputy minister during the period covered by the Report of the Auditor General, reported to ministers Marleau and Gagliano, their assessments of his performance are relevant to any consideration of his exercise of his general responsibility as a deputy minister.

Mrs. Marleau provided the following assessment:

I found him to be an extremely good deputy minister, extremely capable. I have nothing but good things to say about my time working with him. That’s all I can say. (15:1240) [*]

I would also like to add at this point that I worked extremely well with Mr. Ran Quail throughout my term at Public Works. I have immense respect for his integrity and for his excellent capabilities as deputy minister. (15:1210) [*]

Mr. Gagliano expressed a similarly positive, view:

I want to say that I had good relations with the then deputy minister. I used to meet with him regularly. (10:1035) [*]

Mr. Quail did not provide extensive testimony concerning the respective responsibilities of ministers and deputy ministers, but did provide a comment that clearly reflects the deputy ministerial focus on providing advice and implementing the direction of the minister:

… it is a difficult situation, that interface between ministers and deputy ministers. In this particular case, you’d give your advice to the minister, and if the minister decided he wished to proceed, you would proceed. That is the particular model. If you felt that there were issues that were outside of you and the minister and the department, I guess you could talk to the Clerk [of the Privy Council], if you wanted to. (07:1200) [*]

This approach to his responsibilities was strongly reflected in his account of the origins of the Sponsorship Program, which emphasized the priority attached to action by the government, and the need to respond on an urgent basis:

As I started to say earlier, I pointed out to you the way in which we had looked at and managed the program for 99% of the department. To talk about the situation with respect to Canada Communication CCSB [Communications Co-ordination Services Branch], the submissions, as I noted, were signed by the minister and the Prime Minister. It noted the ongoing challenges that the government felt had to be addressed. (07:1055) [*]

Look, the submission was signed by the minister. It was signed by the Prime Minister. It was a direction of the government that the government wanted to move this. It was an urgent situation. (07:1150) [*]

While Mr. Quail did not express it in terms relating to the doctrine of ministerial and deputy ministerial responsibility, the fact that he perceived a tension between his general duty to respond to direction from the minister and more specific responsibilities relating to managerial and administrative practices was apparent in his response to questioning about the direct working relationship between Minister Gagliano and the Executive Director of the Sponsorship Program:

Obviously, this is a very difficult situation for a deputy in terms of the fact that you’re working with the minister. On the one hand, you can say, “Minister, you can’t talk to that particular group. You have to come through me every time you want to talk to them.” I did not do that. I did not do that. The minister wanted to have these discussions. He wanted to be involved. He had a responsibility. He had signed the submissions. He had direct approval to proceed and get this done. (07:1115) [*]