PACP Committee Report

Health Canada thanks the Committee for its recognition of the important role that the Department has to play in protecting the health and safety of Canadians.  Health Canada's regulatory responsibilities are significant and broad.  At the core of Health Canada's regulatory responsibilities is the need to reduce health and safety risks to Canadians and ensure that they benefit from the use of safe and effective products and healthy environments. 

The assessment of health risks, as well as the selection and implementation of effective risk management strategies, form the basis for Health Canada's regulatory activities.  Since Health Canada assesses and manages multiple emerging and existing risks, this requires that decisions regarding resource allocation address the highest risks. To ensure that appropriate resources are allocated to support these processes, the department recognizes the need to make resource allocation rigorous by continuously improving information, documentation, financial management, transparency, measurement and reporting of performance.

The need to improve resource allocation processes and associated information was highlighted by the Report of the Auditor General in November 2006 and confirmed by the June 2007 report of the Standing Committee on Public Accounts.  Health Canada has committed to address the recommendations of both Reports.

Recommendation 1

Health Canada provide the Public Accounts Committee with progress reports every six months on the implementation of recommendations made by the Auditor-General in her November 2006 Report, beginning in September 2007 and continuing until the recommendations are fully implemented.

Response Agreed

Health Canada will provide the Public Accounts Committee with status reports every six months. Health Canada's Action Plan is made up of a series of quarterly deliverables, one of which spans the period from July-September 2007.   Therefore, the proposed beginning to providing status reports to the Committee would occur in the middle of this quarter if the status reports begin in September.

In order to provide the Committee with a complete status report for the July-September quarter that is more timely, Health Canada will provide the Committee with its first status report by October 31, 2007, and every six months thereafter.  This will ensure more accurate matching of status reports and action plan deliverables.

Health Canada provide the Public Accounts Committee the results of its comprehensive reviews immediately upon completion.

Response Agreed

Health Canada will provide the Public Accounts Committee with the results of each of its comprehensive reviews upon their respective completion.  A completed comprehensive review includes the development of action plans that have been reviewed and approved by the Minister of Health.

Treasury Board develop a policy December 31, 2007, requiring all regulatory programs to establish clear program baselines that set out the required level of activities, performance and resources required to meet regulatory responsibilities.

Response Agreed in principle

While Treasure Board Secretariat (TBS) agrees with spirit of Recommendation 3, development of an additional policy is not required.  Beginning in summer 2007, the Government of Canada is implementing a new approach to managing all direct program expenditures (including regulatory programs), to ensure federal programs are effective, efficient, focussed on results and provide value for money, are aligned with the Government's priorities and responsibilities, and control the growth of overall spending.  The approach will focus on providing better information on programs, including baseline information, in order to support improved decision making and periodic reviews of changes in program spending and performance.

In addition, TBS is also responsible for the Cabinet Directive on Streamlining Regulation (CDSR), which came into effect on April 1, 2007, and applies to all departments and agencies involved in the federal regulatory process.  In particular, The CDSR requires that each regulation be accompanied by an implementation plan that specifies the required level of activities (e.g. compliance and enforcement) and include a human and financial resources plan that is commensurate with the required level of activities. For significant regulations, time-based performance indicators are required to be developed to feed into the expenditure management system of TBS to enable regulatory departments and TBS to monitor performance on an ongoing basis.

Health Canada make risk assessments an integral part of the comprehensive reviews of its regulatory programs.

Response Agreed

Health Canada agrees with the recommendation to make risk assessments an integral part of the comprehensive reviews of its regulatory programs.  Risk assessments are integral components of the decisions made by the Department, as outlined in Health Canada's Decision-Making Framework for Identifying, Assessing and Managing Health Risks.

In the course of its reviews, Health Canada is developing baseline data on its regulatory program activities to determine: the appropriate program activity levels required to deliver its mandate, the costs and associated human and financial resources allocated to perform these activities, and current performance targets.

The Department will use this information to assess costs and performance against domestic and international standards and benchmarks, and to identify possible gaps related to the level of activities and resources required to meet its regulatory requirements and performance standards. An assessment of health and safety risks associated with identified gaps will be conducted and appropriate policy and regulatory frameworks based on risk mitigation strategies will be developed.

Health Canada's proposal to Parliament regarding changes to user fees clearly indicate how the funds will be allocated amongst pre-market and post-market activities and what proportion of program funding will be based on user fees.

Response Agreed

Health Canada agrees with the recommendation that its proposal to Parliament regarding changes to user fees for the Health Products and Food Branch (HPFB) clearly indicate how the funds will be allocated amongst pre-market and post-market activities, and what proportion of program funding will be based on user fees.

The Branch has reviewed its cost recovery framework and fee structure associated with the regulation of therapeutic products and has developed a revised framework which is targeted to be implemented in 2008-09.  The framework is a key component of the HPFB Blueprint for Renewal, which aims to modernize the Canadian regulatory system and strengthen its position as an internationally recognized regulatory leader.  A consultation document was published on April 4, 2007, to inform stakeholders about the proposed cost recovery framework and to solicit feedback.

In this process, HPFB engaged more than 40 stakeholder groups in 18 face-to-face meetings (including a multi-stakeholder meeting on May 14, 2007), collected nearly 300 responses to the Business Impact Test (BIT) and received almost 200 written responses to a series of questions related to the proposal.  The consultations closed on May 15, 2007.

To date, stakeholder feedback on HPFB's proposed directions has been constructive.  Feedback was analyzed and a Stakeholder Consultation Report was posted on Health Canada's Blueprint Web site and the HPFB Cost Recovery Initiative Web site on July 12, 2007.  This feedback also served to revise the proposed Cost Recovery Framework. An Official Notice of Fee Proposal for Human Drugs and Medical Devices was also posted on July 12, 2007, as required by the User Fees Act.

As for the next steps, stakeholders have been encouraged to provide feedback on all aspects of the Official Notice of Fee Proposal for Human Drugs and Medical Devices.  They had until August 24, 2007, to request an Independent Advisory Panel to make an independent recommendation to Health Canada for any cases where specific concerns could not be resolved.

Subsequently, the final Cost Recovery Framework will be submitted to Parliament and will follow the established regulatory review process.  The implementation of proposed new and revised fees is targeted for early 2008-09.

Health Canada recognizes the important role it has to play in regulating products that are vital for and impact on the health and safety of Canadians.  The Department is committed to the effective and efficient management of its regulatory programs.   Health Canada will seek to continuously improve its planning and decision making with respect to its regulatory programs.  Health Canada will look for synergies amongst its various regulatory programs and will ensure that information is available to demonstrate how it is fulfilling its regulatory responsibilities.