SIRP Committee Meeting

SUB-COMMITTEE ON IMPROVED FINANCIAL REPORTING TO PARLIAMENT OF THE STANDING COMMITTEE ON PROCEDURE AND HOUSE AFFAIRS

SOUS-COMITÉ SUR L'AMÉLIORATION DES RAPPORTS FINANCIERS AU PARLEMENT DU COMITÉ PERMANENT DE LA PROCÉDURE ET DES AFFAIRES DE LA CHAMBRE

EVIDENCE

[Recorded by Electronic Apparatus]

Wednesday, May 17, 2000

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[English]

The Chair (Mr. Paul Szabo (Mississauga South, Lib.): We're resuming the business of the Subcommittee on Improved Financial Reporting to Parliament of the Standing Committee on Procedure and House Affairs.

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Today we have witnesses from the Office of the Auditor General of Canada and from the House of Commons. We're going to deal first with testimony from the Office of the Auditor General. We have with us Maria Barrados, Assistant Auditor General, audit operations branch; Mr. John Mayne, principal, audit operations branch; and Mr. John Hodgins, principal, audit operations branch.

Welcome to you. We appreciate your appearing before us to provide some words of wisdom on the order of reference from the Standing Committee on Procedure and House Affairs with regard to financial reporting to Parliament.

I believe you are familiar with some of the previous work done on this issue by various committees and round tables, and also generally familiar with the materials presented to the committee by Mr. Lenihan, who is engaged by Treasury Board. With that assumption, welcome, and we look forward to your commentary.

Ms. Maria Barrados (Assistant Auditor General, Office of the Auditor General): Thank you, Mr. Chairman, for the opportunity to speak to the subcommittee on a subject of great interest to the Office of the Auditor General.

We are pleased this subcommittee has been struck and has been asked to address a number of very important issues. The Auditor General has been very supportive of the government's efforts to improve reporting to Parliament, while urging it to make faster progress.

In 1997 we reported on the government's efforts to improve reporting and we are currently conducting a government-wide follow-up audit, the results of which will be included in our November report. The Auditor General also appeared as a witness before the subcommittee on the business of supply when it looked at the supply process.

This subcommittee has been asked to consider four themes related to improved reporting to Parliament, and I would like to address each of these very briefly.

First is tailoring estimates information for parliamentary needs. Our office has supported the changes made to the estimates by the introduction of the fall departmental performance reports and spring reports on plans and priorities. We think this has been a very positive change.

[Translation]

We support the focus on results and results commitments as the basis for the reporting to Parliament. However, there is a need for clearer and more concrete statements of the results departments are to achieve, so that members can better judge how well programs are doing and not just what they are doing. Too often, we find quite loosely worded statements of what is intended, statements that do not indicate clearly what is to be done, by when and how.

There is a need for better explanations of how activities undertaken are contributing to the reported results, supported by appropriate evidence. This is a challenge, but it must be addressed if reporting on the performance of federal activities is to be meaningful.

There is a need for more balanced reporting that discusses problem areas and what is being done to improve them. This, too, is a challenge, but without more balanced reporting the credibility of the reports is considerably reduced.

Improved information is also needed on the costs associated with the results the government is achieving. Members and the public need to know how much it has cost to achieve the reported results.

Parliamentarians need more tailored information on results, and we welcome efforts to provide it. However, in our view the government needs to pay more attention to ensuring that the information it provides on results is both reliable and meaningful, that it provides more than just data.

Second, I'm going to talk about streamlining and consolidating reporting for Parliament.

We see significant opportunities for improvement through electronic reporting and we encourage the government to continue moving in this direction. We suspect that e-reports will inevitably become a formal part of the estimates.

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E-reporting allows for convenient and accessible linking of all results-based departmental and government reports. Cascading reporting should allow members easy access to both high-level information on programs and detailed information on specific operations of interest to members. The move toward e-reporting should be made in consultation with Parliament to ensure that members are equipped to take advantage of these opportunities.

[English]

As a further element of streamlining—one we suggested several years ago—there is room for some cyclical reporting in areas of stable mandates and workload. Results achieved in these areas do not change rapidly, and Parliament can probably be kept adequately informed on a less frequent basis than annually.

Third is reviewing and strengthening parliamentary review processes. Considering ways to strengthen the parliamentary review process is perhaps the most critical of the issues addressed by the subcommittee. The committee's own report on the business of supply concluded that parliamentarians are discouraged by rules and structures that do not facilitate and sometimes unintentionally hinder the conscientious scrutiny of proposed expenditures.

Over the last few years our office has participated in several symposia and round tables with members on the subject of reporting to Parliament and we have also had discussions with government officials. Through all of this, a number of suggestions have emerged that the subcommittee may want to consider.

One suggestion is to make the current reporting regime a permanent feature of the financial procedures of the House, while still encouraging innovation and experimenting with improved approaches to reporting. By a resolution the House adopted in April 1997, the current form of the estimates is a pilot with no permanent status.

A second suggestion is to expect standing committees to review the estimates referred to them and to report on their review. At present, if not reviewed by a committee, estimates are nonetheless deemed to have been reviewed.

A third suggestion is to make the membership of standing committees more stable in view of the need for continuity and the development of expertise in examining the estimates. The present high turnover of committee chairs and members impedes effectiveness.

A fourth suggestion is to look at the possibility of better tracking committee questions and concerns in light of the often short tenure of committee members, perhaps with the assistance of the parliamentary research branch and greater use of technology. This would give new committee members ready access to the questions and concerns already raised with officials and their responses.

Our fifth suggestion is, as others have recommended over the last few years, to have a House committee periodically review new initiatives to improve reporting, which would give Parliament an ongoing role in reviewing existing procedures. This committee could track the nature and results of standing committee reviews of departmental performance reports and reports on plans and priorities.

The last suggestion is to consider, in light of the trend toward e-reporting of the estimates, how Parliament and its committees can best deal with this development.

Of particular importance, the subcommittee may wish to consider how standing committees can effectively engage departments and consult with them in reviewing statements of results commitments, and discuss how they will demonstrate their achievement against those commitments. If committees had this kind of involvement, departments might be more diligent in reporting back what they have accomplished toward their results commitments.

To improve information to Parliament on the use of government's expenditure plans and the use of funds in relation to these plans, the government has decided to introduce accrual accounting for all its key accountability documents except estimates and appropriations. Over the years, the Auditor General has recommended that the government also introduce accrual appropriations so that government managers would plan, manage, and report on the same accrual basis.

The government has issued a consultation paper that concludes that the adoption of accrual appropriation appears to offer many benefits, and my office's reaction to that paper is therefore positive. We have, however, provided several observations to the government.

First, there is is an underlying need for rigorous accounting rules and conventions that are consistently applied.

Second, there is a need to develop quickly a detailed and practical risk-based strategic work plan.

Third, a practical pilot or demonstration model should be developed to ensure the details of what is being proposed are thought through and will work in practice.

Fourth, there is a need to establish regular and frequent liaison with other jurisdictions, such as the United Kingdom and Australia, to help Canada anticipate problems and develop practical solutions.

Fifth, the government should be specific about the behaviours it wants to encourage among managers and should be aware of the incentives needed to achieve these behaviours.

Thank you for hearing our views, Mr. Chairman. We would be glad to answer any questions you may have.

The Chair: I wonder if I can impose upon you to repeat the last five points. I think they're very important.

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Ms. Maria Barrados: Do you want to repeat them in full, or just summarize them?

The Chair: You can start with “rigorous”.

Ms. Maria Barrados: The first one is an underlying need for rigorous accounting rules and conventions that are consistently applied. This is because of the amount of judgment that has evolved in the application, so the need for rigorous rules and their consistent application becomes heightened.

Second is the need to develop quickly a detailed and practical risk-based strategic work plan. There are a number of practical considerations that are involved here, so the question is how to move this forward.

Third, a practical pilot or demonstration model should be developed, to ensure that all the details are worked out and thought through. This often can only be tested in their application.

Fourth, we're saying there is a need for regular contact with other jurisdictions, like the United Kingdom and Australia, that have adopted these changes. There's a lot we can learn from them.

Last is to give some thought to the kinds of behaviours we're trying to encourage, because there are incentives that can work one way or the other. This should be thought through, in terms of the kind of management we're looking for.

The Chair: Thank you very much.

I believe there is room for some discussion here, and I'd like to invite the members to start. Who would like to start off? Mr. Williams.

Mr. John Williams (St. Albert, Canadian Alliance): Thank you, Mr. Chairman.

It looks like we're going to be interrupted by a vote.

The Chair: It's just a quorum call.

Mr. John Williams: Then we don't have to worry too much about it.

In point five, Ms. Barrados, in your opening statement you say:

Too often, we find quite loosely worded statements of what is intended, statements that do not indicate clearly what is to be done, by when and how.

I think the Auditor General has talked about, in the grants and contributions, how the criteria are so wide that virtually anything qualifies. How would we go about ensuring that the criteria of grant programs—the public policy of new programs or even existing programs of the government—are articulated, to ensure that focus of the government's intentions? Where would we start?

Ms. Maria Barrados: You've asked a series of questions.

As you know, grants and contributions are specific tools, so I won't deal with them to start.

Mr. John Williams: I used them as an example of the fact that the criteria are so broad and so wide.

Ms. Maria Barrados: The issue we're making, in terms of the reporting, is that it's extremely important to get that statement of what a program is to do if we're staying with that set of programs. If there is a statement that the program is for job creation, it should be very clear it's for job creation. What kind of job creation? Is it temporary? Is it sustainable job creation? We need clarity in that statement.

The next level of clarity needed is on roughly how much and by when, so members will know at the end of the period—at the end of the year when the performance report is given—that there will be a way to judge whether the program was successful or not. The decision on whether that program is delivered by grants and contributions or some other means is a different kind of discussion, I think.

Mr. John Williams: In your point seven you say the information the government provides on results should be both reliable and meaningful, and should provide more than just data. I combine that with your last point that the government should be specific about the behaviours it wants to encourage, and so on.

I have been quite critical of the performance reports by departments. I call them self-serving in many ways, and say they're not objective critical self-evaluations. I would like to see them be critical self-evaluations. I would like to see behaviour that would motivate the departments to have some more critical self-analysis. How could we go about introducing that? Do you have any thoughts on the issue?

Ms. Maria Barrados: I think one important element we suggested in our opening statement is to have the committees involved up front, to have more of a dialogue with members of Parliament about the objectives and what is to be accomplished. There is a role there. There's also a role for committees to scrutinize those results and the reports that are being given to Parliament, and have discussions with officials about those performance reports.

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As you know, my office periodically reviews these reports, but I think there has to be a lot of encouragement and incentive on the part of outsiders to the officials to do this, because it is hard work; it is tough, and it isn't always easy to be providing negative results.

Mr. John Williams: On your point ten, it seems to me you are supporting the concept of program evaluation. You may be aware I have a private member's bill that talks about program evaluation. It calls for four fundamental questions to be answered: first, the public policy that a program is designed to address should be properly articulated; second, once that is properly articulated, through evaluation we can measure how effective it is in addressing that particular public policy need; third, are we doing it efficiently; and fourth, can we do the same in a more effective way.

Is that what you're calling for in ten—that we should try to move program evaluation forward in the government's agenda?

Ms. Maria Barrados: In point ten we're talking about cyclical reporting. The idea is that for some small stable agencies it may not be necessary to have a full performance report every year. But I'd like to comment on Mr. Williams' comments about program evaluation.

Program evaluation is an activity of government that my office has supported very strongly, because it's a very important tool in assessing the effectiveness and the cost-effectiveness of government programs. So we have done audit reports at various times calling for more consistent program evaluation, covering programs more broadly.

Program evaluation not only provides a tool to give information on the cost-effectiveness of programs. The precursor of program evaluation, which is putting a framework in place to define what measures are to be developed and used, is a very helpful tool for developing the kinds of things we're talking about in the performance reports, in terms of clarity of objectives and clarity in the kinds of measurements and goals you're seeking to put into those reports.

Mr. John Williams: I have just a final point, Mr. Chairman.

I would like to draw the committee's attention to point eleven, where Ms. Barrados makes the point, regarding the committee's review of the estimates, that sometimes the rules and structures unintentionally hinder, and do not necessarily facilitate, the conscientious scrutiny of the proposed expenditures. I think it is very much part of the mandate of this committee to address that issue.

The Chair: Thank you.

Mr. Sauvageau.

[Translation]

Mr. Benoît Sauvageau (Repentigny, BQ): Ms. Barrados, gentlemen, good afternoon and thank you. I have a few questions to ask you. First, your presentation was very clear. It give us a lot to think about for the report, but there are a few things I find difficult to understand.

In the second paragraph, you write:

In 1997, we reported on the government's efforts to improve reporting and we are currently conducting a government-wide follow-up audit...

If I understand correctly, there was a study done on reporting and on access by parliamentarians. The Office of the Auditor General is again conducting a study. There is a very good document...

Mr. John Williams: The Williams-Catterall report.

Mr. Benoît Sauvageau: ... which is already available. In paragraph 12, you write:

Over the last few years, our Office has participated in several symposiums and round tables.

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I wonder whether there is any duplication with the report we are proposing to do or whether all these come together as a whole.

[English]

Ms. Maria Barrados: The follow-up we are doing is very much within the scope of that 1997 report, and we're looking very much at the content of the documents themselves. We're looking at the performance reports and we're looking at the documents of plans and priorities. And we're looking to see what kind of progress is being made in terms of improving those reports.

The kind of analysis we'll do is to spend a lot of time looking at the reports. We'll do a statistical analysis to show the nature of the improvement. I don't think this in any way duplicates the kind of work that is currently being done, which is a larger set of questions about the incentives and the reporting structures.

It probably would be more helpful to you if that report were done. It would be another piece of information that you would have available. Unfortunately, it isn't ready.

[Translation]

Mr. Benoît Sauvageau: Among your recommendations, one is, I think, of the utmost importance to implement all the others: it's the one dealing with a change in the way committees work. If we don't manage to implement this recommendation first, all the others become hypothetical, because there is a direct link between all of them. Is it up to this sub-committee to try and review the role committees play, or should another House committee look into this?

[English]

Ms. Maria Barrados: It's difficult for me to give an answer on the procedures for committees. Perhaps Mr. Marleau can better talk about some of those things.

[Translation]

Mr. Benoît Sauvageau: I'll ask him later.

[English]

Ms. Maria Barrados: I would add, though, that anything that can be done to make the committees work more effectively and to make more use of these documents that are being prepared for the estimates and provide the incentive for public servants to take this all very seriously would be very helpful. It's not to say that's not possible, because we can all think of some examples where the committees have worked very well. Not all of the committees have problems.

[Translation]

Mr. Benoît Sauvageau: Okay. So that I get it right, can you tell me what could be the impact, direct or indirect, of your recommendations on the Financial Information Strategy the Office of the Auditor General wishes to implement by April 2001?

[English]

Ms. Maria Barrados: The focus of this is on the accounting, and the discussion here is about bringing the appropriations in line with the accounting.

[Translation]

Mr. Benoît Sauvageau: The trend is more and more towards devolving accountability upon agencies. Do your recommendations apply to government agencies or only to departments?

Ms. Maria Barrados: Agencies...

Mr. Benoît Sauvageau: I'm referring to agencies such as the

Canada Customs and Revenue Agency, the Canadian Millennium Scholarship Foundation and all these other things the government is no longer accountable for.

Ms. Maria Barrados: I see.

[English]

The discussions here are primarily about the departments, the ministries, because the requirements for the accounting are specified in the legislation for these other agencies. For appropriations, of course, that applies.

[Translation]

Mr. Benoît Sauvageau: That's all for now. I might have other questions later. Thank you.

The Chair: Thank you, Mr. Sauvageau.

Mr. Godin, please.

Mr. Yvon Godin (Acadie—Bathurst, NDP): There might be a question that I'd like to ask. I don't know if it has to do with your presentation or your comments today, but let's take the following example: Each year, the Human Resources Development Department tables a report on employment insurance, on changes that were made and so on. Each year, there is a report.

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You say here, that there is a need to improve reports to members of Parliament. I can tell you that the last two reports we had were not better than the one which was presented three years ago. Three years ago, in 1997-1998, one of the reports which was tabled was actually simplified. Members could open the report and find the hard facts immediately. It was highly readable. In the last two reports, it looks like they didn't use the same approach and are trying to hide as much as possible from members.

Does the Auditor read these reports to be able to made comments or recommendations? It's important. I'm talking about a report which has been tabled every year for the last five years. We want a report which is both simple and truthful. When you read in such a report on employment insurance that 78% of Canadians are entitled to employment insurance, when we know that only 30% of women and 15% of young people qualify, something is missing somewhere.

[English]

Ms. Maria Barrados: Our audits of these performance reports is selective. For the employment insurance account, we do the financial audit. And we will look at all the discussion that is around the financial statement. But we will not be doing the same kind of audit of the performance reports, both for the ministries and for EI, that we are required to do by legislation for the new agencies.

In the case of the new agencies—the food agency, parks, and the revenue agency—the Auditor General is required by legislation to assess the adequacy of the performance reports. And we do that. We offer an assessment that is in the annual report of those agencies.

[Translation]

Mr. Yvon Godin: Let's look at the financial side. When we read that 78% of Canadians are entitled to employment insurance, when we know that, in fact, only 30% of them qualify, some numbers must be missing somewhere in the financial statement. At the end of the day, all this represents a lot of money.

[English]

Ms. Maria Barrados: That's a different exercise.

Mr. Chairman, do you want to pursue the employment insurance account?

The Chair: I'm getting concerned that we might be opening up a broader scope.

Mr. Yvon Godin: It makes sense.

The Chair: It's a good point. But I'm hoping that we'll try to keep to the order of reference more specifically, as opposed to micro-analysis of a department and whether or not.... But the examples are good. I'm not sure whether we're going to be able to resolve them here.

Mr. Yvon Godin: I'm not trying to get it resolved here, but their mandate

[Translation]

as far as auditors are concerned, what is it regarding such reports? I'm just using this as an example.

The Chair: You're right.

Mr. Yvon Godin: We are here to try and improve reporting to members of Parliament, and this is the example which came to my mind. I don't know why.

[English]

The Chair: If I may, yesterday there was a little discussion about the cyclical reporting issue and about maybe going to longer cycles. There was, however, some question about what constitutes “small”. I'm curious as to whether or not the Auditor General's department has a definition or a benchmark for “small”.

Ms. Maria Barrados: That's an interesting question, Mr. Chairman. I'll ask John Mayne if he has thought about that.

Some hon. members: Oh, oh!

Ms. Maria Barrados: I would say it's less small than stable. Small obviously being a factor, a department like HRDC, because it's been mentioned a lot—very large, with many things going on—you would never expect to be on one of those cycles. But something that doesn't change very much from one year to the next, where essentially you're seeing the same thing because that's the nature of the business, I think would be subject to that kind of judgment.

John, can you add anything more?

Mr. John Mayne (Principal, Audit Operations Branch, Office of the Auditor General of Canada): No, I really can't add.

I think the process might be that a smaller agency might propose that they make the case, that they have the qualifications in terms of stability to do it. And it might be on a trial and experimental basis and see how it works and how members react to it.

The Chair: I think that's helpful, because in the last part of your presentation you referred to the risk-based analysis. Now you've entered into the element of risk assessment, if it's stable, if it doesn't change, if it's fairly predictable and the risk of not doing it on an annual basis is very low. That's something on which we can maybe improve productivity, simply by moving to a cyclical reporting basis of longer than a year. I think it's important to understand that small is not necessarily dollar value of the estimate.

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Mr. John Williams: I have a question on that, Mr. Chairman.

Did I get it right that you're actually talking cyclical reporting or less than annual reporting of a plans and priorities and a performance document? Is that what you propose?

Ms. Maria Barrados: That's the suggestion. The question is whether it is necessary to repeat all that material if it's not going to change.

Mr. John Williams: Okay.

I just want to go on the record that it's not often I disagree with our Auditor General, but I am going to disagree on this one, Mr. Chair, because I think it's vitally important that they do report annually. While things may be relatively static and relatively stable and relatively small, sometimes, after a period of time, an audit comes up that finds that all is not as well as perhaps it should have been. Therefore, I'm not that keen on the idea of performance documents being less than annual. I think I said yesterday that perhaps they could be rolled.... If they're that small and that stable they should be part of a separate or another department. They should be amalgamated.

The Chair: Point made.

You commented generally on the themes and the proposals that were presented to us by Mr. Lenihan. To the extent that you have knowledge or expertise, are there any matters he raised with this committee, that you're aware of, with which you have some difficulty or reservations?

Ms. Maria Barrados: I'll ask my colleagues to answer that as well. I'll just mention a couple of things.

The first thing, when we saw the material, was surprise that there wasn't more discussion about accrual appropriations and the impact of these changes, because there are a number of things here that would have to be changed to implement that.

As well, as a result of work that was done with the public accounts committee and the Auditor General, it is very clear that there has to be some really clear thinking on what is expected to be changed in management and how management does this, because you want this to be a part of the management system. That would be the first thing.

I believe the other parts of the report didn't pose great difficulty. I would only suggest that in the area of societal indicators, that requires a little bit of care and some clarity. The argument can be that the societal indicators are part of a full accountability process, so that there's a commitment to the broad indicator and all the things fit in. Some of the discussion suggests that might be the case, whereas at the same time it is my understanding that the approach Treasury Board has taken is that societal indicators are for information and are not necessarily there for accountability purposes.

I think this needs some clarity. Technically, it can become quite difficult to do this. As long as it stays on a level of providing what we term the performance story, or an explanation of how programs fit together and what their purpose is, it doesn't pose a problem. If it becomes an analytical exercise in terms of trying to link these things with attribution, analytically it can become a very difficult task, and it may not be worth the effort at this point.

John Hodgins or John Mayne.

Mr. John Mayne: As Maria said, I think we're certainly in general agreement. If you look carefully at the opening statement, though, we've tried to identify some of the areas where we think things need to move a little bit more. I'm not sure where the government is going, or proposing, on whether they want to make this system more permanent. It's still sort of a pilot they want to continue to experiment with, which is fine, but it still remains a temporary thing.

I think we were pushing for a little more attention on the statement of what programs are to accomplish. That's a key part of making successful reporting, and the reporting back against that is sort of a key element. I think that's something that needs to get special attention, as does the issue of the fairness and reliability of the information in the reports.

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It's not that the government is neglecting this, but I think we would think that this should get more visible attention in the current reporting and in the future reporting. Without that, as we've heard Mr. Williams say, members are skeptical of a lot of the information in there. That's a major challenge and is something we would probably put the spotlight on as some of the issues that may go beyond what the government is going to be proposing.

The Chair: Mr. Hodgins, did you have something to add?

Mr. John Hodgins (Principal, Audit Operations Branch, Office of the Auditor General of Canada): Mr. Chairman, the only thing I would add is to reiterate a few of the points that Ms. Barrados has made in the opening statement.

We feel that moving on the basis of accrual appropriations is very important to do as soon as possible. As Ms. Barrados said, the move to accrual accounting, in terms of government financial reporting, is going to happen in the fiscal 2001-2002 year. And there will be quite a burden placed on departments in reporting to Parliament on what is being described as a partial accrual appropriation basis as well as a full accrual reporting basis and the reconciliations—if I can use that word—between the two.

So it's something for which we would like to see a more formal plan put in place as to the things that have to be done to get us to that state, Mr. Chairman.

The Chair: Sure.

I had one last inquiry, if you care to comment. Has the Auditor General's department ever commented or made recommendations with regard to the process of review of the estimates by parliamentary committees?

Ms. Maria Barrados: John has a better recollection of this than I do, so I'll get him to answer.

Mr. John Mayne: In our chapter we did in 1997 on reporting, at the end of it we did have some suggestions for the kinds of issues committees might want to address in review and suggested the need for strengthening committee review.

And in February 1998, I believe, I'm not sure how we provided it, but we sent to Parliament a report on the reviewing of estimates with some suggestions on it, questions committees could ask about performance reports, RPPs and performance reports, that tried to get at the issue a little bit. Obviously members decide themselves how they want to run committees. But we've tried to provide some help and suggestions to that end.

The Chair: Thank you. We'll be sure to have those documents made available to all committee members as soon as possible.

Mr. Williams.

Mr. John Williams: Yes. I have one final point, Mr. Chair, on the point Ms. Barrados brought up on accrual accounting.

The Auditor General reported fairly recently on accrual accounting within the government and pointed out that there would be a serious disparity if the estimates still required reporting on a cash basis. He noted that if we insisted on having the estimates presented on a cash basis it would cause the government to maintain two sets of books and the emphasis would likely be on the cash basis because that's what they've been doing for 130 years. It's the one they know best and it's the one that Parliament demands. Therefore accrual accounting and all the benefits that could flow from that would be playing a second fiddle.

Did I get that correct, Ms. Barrados? Would you like to add anything to that?

Ms. Maria Barrados: I think that's absolutely correct, Mr. Williams.

And for us it's very important that it makes a difference to management. If you have the accounting system working one way and the appropriation system working another, there is really no incentive to deal with the management issues, and no incentive then to have managers use this in their management and their management decision-making.

The Chair: Thank you.

Mr. Ianno.

Mr. Tony Ianno (Trinity—Spadina, Lib.): Thank you.

Sorry I came late, but I did read what you presented.

I'm curious. In here I saw a few items that alluded to my question, but I'd like to see if there's an additional part that might help me.

How do you see the Auditor General's department playing a role regarding the partnership of the opposition, the bureaucracy, the Liberal members on a committee, and the minister, so that in effect when goals are set and we're looking to see if they are achieved, through your normal course of work you are able to actually create a rating system that will in effect say this department has done very well in working with all the partners in the process, so that it becomes less confrontational and more goal-oriented?

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Ms. Maria Barrados: Mr. Chairman, in many parts of this the Auditor General doesn't have a role. The kind of thing we are suggesting is that departments and officials, on behalf of the minister, have discussions with committees earlier and more frequently on the goals and the setting of the goals. I don't believe that's a job for the Auditor General.

We can come in and provide advice, if we are asked, on the adequacy of the setting of the goals as a technical exercise. And what we would do as a technical exercise is we would look at the policy statements, we would see if there are links between the goals and the policy statements, and then we would look to see how operationalized they were—in other words, how this would lead to a measure and a basis for reporting.

We currently periodically do audits of the estimates documents. So we do these kinds of assessments, but we don't do them on a routine basis; we do them periodically, with the exception of the agencies where we're asked to do something different. And then again we don't give assessments on the goals. That's not really our job; that's management's job. But we will make an assessment and a judgment about the clarity and then the performance against them.

Mr. Tony Ianno: In other words, if I understand correctly, you see the status quo as being appropriate for your role.

Ms. Maria Barrados: Yes, I do. Where the role could change is if we were asked specifically by committees, and that would have to be a majority kind of decision of the committees.

We do now attend all standing committees and we do try to respond the best we can. I'm not here advocating for a different role for the Auditor General.

Mr. Tony Ianno: With all the discussions we've had before, in terms of what I've been involved with, one of the points I thought was coming pretty much as a consensus was that the system has to change in order for the antagonistic approach to disappear so that in effect we'd be working as a team as parliamentarians, and those involved from the bureaucracy and the Auditor General's department, so that in effect we would ensure that government works better.

If you're in effect saying you think that your role as it is should be that way, then where does the change occur, considering the opposition's natural role is to oppose anything that is done, the bureaucracy's role is to protect the minister, the minister's role is to protect the government, the Liberal committee members' role is to protect the government, so in the end we all end up in the same boat and nothing gets changed?

So how can we find a way whereby we change the paradigm so that in effect you're still accomplishing your goal of ensuring that there is reliability? I read number seven, page two, where you say it should be more reliable and meaningful, which I guess is not to do with numbers and more to do with interpretation. How do we change it?

The Chair: We would like to hear from Ms. Barrados, to the extent that you want to comment.

Ms. Maria Barrados: The question has a lot of implications, and I'm puzzling as to how to give the most helpful kind of response.

We do suggest that more and frequent dialogue is very important. Certainly in terms of the goal-setting exercises that are in the plans and priorities, if it were possible to have more discussion before these goals are in concrete and written down and then it becomes a point of defending them, if there were a possibility to have more of a discussion early on, I think that is possible in terms of a dialogue between officials and members in committees.

On the issue of the kind of confidence that can be had in the reports—and right now many reports are not viewed as very credible—there's a search for making these things more credible. I don't think this is necessarily always my office's role. We can do some of that, but I think there are things that the government, the bureaucracy, can do as well in terms of providing more of a quality assurance, if you like, on those reports and do it credibly.

• 1625

Our practice has shifted quite a bit over the past ten years under this current Auditor General. We have spent a lot more time than we have in the past working with government to do things such as helping to improve documents. We give a lot of training courses inside government. With regard to the document that was referred to earlier, this kind of document, we did spend a lot of time working with government officials to do that. So there's a lot of dialogue in moving things along.

Mr. Tony Ianno: How did that change occur?

Ms. Maria Barrados: The change occurred in large part because of our current Auditor General, whose objective is to make improvements. He has his mandate, as is described in legislation, but as part of that, he wants to make a positive difference and make improvements in how government operates. So the question that is posed to us when we are planning our work is how can we do this.

I think John can probably give you a lot of examples on how we have worked on things such as FIS. You see the results of it in our reports, but there's a lot of work going on. UCS is another one, the universal classification system, for the human resource management system.

Mr. Tony Ianno: So a change has occurred in the last five or so years.

Ms. Maria Barrados: I believe a change has—

Mr. Tony Ianno: In other words, if we go one step further, that's possible also, as long as the current Auditor General buys in that in addition to the changes that are already taking place, perhaps a slight change might help the system, and then in effect the whole department will change. Is that correct?

Ms. Maria Barrados: Our Auditor General is nearing the end of his mandate. We have a new Auditor General coming, so it's very much up to the new Auditor General. I'd be surprised if anybody took that position and didn't keep on that same track, because in fact we have moved a number of things now. As I said in the opening statement, we don't feel we've moved far enough.

Mr. Tony Ianno: So we're on the same wavelength. More change could occur. It's just a matter of how the change occurs so that we change the system and it doesn't stay on the status quo. Is that correct?

Ms. Maria Barrados: That's right. We're not advocating the status quo. We want to move it ahead. We often get frustrated because change isn't fast enough. In the case of reporting, we think it could be faster on accrual appropriations. We think it's time to move on. We've made progress, in that two years ago, I believe it was, we were told that it wasn't possible, and now there's an agreement to do it. There are human resource management systems. We say that it's not fast enough. So we tend to make our reports when we feel that it's not moving fast enough, but there's a lot of discussion that goes on trying to move it.

Mr. Tony Ianno: Do you communicate with the auditors general at the provincial level? In paragraph 15.4 on page 5 you refer to the U.K. and Australia. How about within Canada? In some of the committee work we did before, we talked about working with the other levels of government so that we would not be reinventing the wheel concerning vertical integration.

Ms. Maria Barrados: Yes, we do. We have quite close contact with our provincial colleagues, and there is actually a formal organization of the legislative auditors general. They meet regularly. They confer regularly on issues that confront them. So it's a good working relationship. They meet formally at least twice a year, and they have subcommittees that meet more frequently. The one meeting they have is held at the same time as the chairs of public accounts committees.

Mr. Tony Ianno: Are any of the provinces doing anything on what we're trying to work toward, or are they behind where you're at?

Ms. Maria Barrados: There has been a lot done on estimates reform and performance reporting in two or three of the provinces. The province that is cited as having made the most progress is the Province of Alberta. There's a lot being done in Quebec in terms of the changes they are making in their committees and how they're operating and looking at their performance reporting. The other one is Nova Scotia.

Mr. Tony Ianno: Thank you.

The Chair: This has been very helpful. On behalf of the committee, I would like to thank Ms. Barrados, Mr. Mayne, and Mr. Hodgins for your kind input on some important issues. We appreciate your frankness as well on some issues we'll have to debate among ourselves.

What I'd like to do now, colleagues, is suspend for two minutes to allow us to change panels. Then the Clerk of the House will join us.

• 1630

• 1632

The Chair: Resuming the subcommittee hearings, I'd like to welcome, from the House of Commons, Mr. Robert Marleau, Clerk of the House, and Mr. William Corbett, Deputy Clerk.

As you know, the committee is considering the order of reference from the Standing Committee on Procedure and House Affairs with regard to financial reporting to Parliament. I know you're familiar with the issue. We welcome your input and look forward to discussing some of the issues with you. Welcome, and please commence.

Mr. Robert Marleau (Clerk of the House of Commons): Thank you, Mr. Chairman.

I don't have a prepared text on the subject matter to hand out, but I do wish to make some opening remarks, if you'll allow me.

Thank you for inviting us to share with you some of our experience with this process, if I can put it that way.

May I begin by trying to give some context to the remarks I'm about to make. I've reviewed the testimony of the Treasury Board officials, and I listened to the Auditor General with interest. I want to say at the outset that I have no particular difficulty with the four themes that have been put before you. I would, however, like to concentrate on my area of expertise, which is Parliament,

[Translation]

and more precisely on point 11 in the statement by the Office of the Auditor General. First, to put things in context, I'd like to quote a statement by the Chair of a sub-committee similar to yours, Ms. Catterall. On May 14, 1996, she said,

[English]

and she's speaking from the chair:

I just wanted to make a comment from the parliamentary side that I think the whole issue of accountability, while it's not one of those things that rings bells in the media or with many of your constituents, at bottom is what a lot of them are asking for. We want to know that Parliament has a handle on what's being spent and how it's being spent, and that our members of Parliament are there to make a difference, to be able to hold the bureaucracy accountable for what's going on.

I don't know about all of your offices, but the one thing that triggers phone calls to my office is one article on $20,000 that was misspent in ridiculous ways. That will trigger a slew of 10 to 20 phone calls, much more than on fairly serious issues. I think that's a symbol of a malaise out there in the public. They feel that nobody is really watching.

My own personal view is that as parliamentarians and as members of committees of Parliament, we really haven't taken the effective role that we could, not only in checking how the resources are used but in trying to influence future patterns of spending.

• 1635

I want to use that slight mea culpa by the previous chairman to give you the following comments on what I think is the core issue here.

Ms. Barrados mentioned that she or the Auditor General would wish that these documents be more used, have a more concrete impact in the process. I think that's worth looking at. It's a little bit like question period. The accountability exercise we go through every day is much maligned in the media and sometimes by yourselves, in terms of what the outcomes are. The true accountability power of question period is not in the question that's asked or the question that's answered; it's in the question that can be asked in a timely fashion. Whether it's asked or not is irrelevant, but it can be asked.

So whether some of these documents are in fact used to some degree is irrelevant. They are there, and they are there when they are needed. They have to be accurate and they have to be useful when they're needed. It can be frustrating for the bureaucracy to make that kind of effort to Parliament, but Parliament is a very small funnel to put all that information through. These documents are not effectively used. The fact that they are tabled I think is very important and should continue in terms of reporting to Parliament.

Reporting and accountability are not the same. Reporting is what the government does. Holding the government accountable is what the House does. You hold people accountable; they don't become accountable. Very few people have that tendency. It's not a natural human reflex to hold oneself accountable to someone else.

Reporting has all kinds of motives on the part of the person who reports or the body that reports, but accountability is something that is done to it and it's the very essence of Parliament. I'll save you the lectures of why Parliament holds government accountable.

There's another reality check when you deal with these documents that you have to address, in my view. The first is time and the second is money. I know there's an effort to extend the cycle here to give time to get back to where we started from and make it more meaningful. But the reality is that from the time the estimates are tabled before March 31 to the time they are deemed reported on May 31, that's a timeframe in which there are three weeks of recess. There are two weeks at Easter and there's one week in May.

Furthermore, on the resourcing side, let's start with the members. Once you eliminate cabinet, parliamentary secretaries, committee chairs, House officers, chair occupants, and those who have other missions, you have about 180 men and women to distribute amongst the standing committees to do the review of estimates or priority and planning reports or performance reports. In my view, you really do not have the horsepower in resources, in elected membership, to take a comprehensive approach to that work.

On the resourcing side, resources are provided to you through your operating budgets, committees branch, the Library of Parliament, researchers, etc. The resources that are available to do that particular exercise or participate in that particular exercise are very small indeed. Some of them are split over other activities where there's legislation or other inquiries.

Why are we here? Why are you here looking at this today in the context of the role the House has to play in holding the ministry accountable, as compared to how you're going to do it? That's why I want to make that distinction. You're talking about the how. I would like to ask you to address the why. The how, whether this is a pilot project or an ongoing thing....

• 1640

It was in this very room actually in 1981 where Andy Macdonald, who was the assistant secretary to Treasury Board, engaged the committee clerks of the day in a discussion on how the government was intending to break the blue book apart into parts I and II and introduce the concept of part III to provide better information, more detailed information to members. It was a committee clerk—I forget who he was—who said “That's great; we need this kind of information. But you're putting it all down the same funnel. It's the same recipient at the other end, with no more time and no more resources.” That still applies today. That was a “how”.

The “why” is simply that when the House did estimates in the former committee of supply, the minister attended the House with one or maybe two resources on the floor to assist him or her through the process. In 1968, when you had the reform on estimates, which sent the estimates to all standing committees simultaneously, initially the ministers came. Initially the committees took a real interest.

[Translation]

Members started to tackle the estimates with a lot of spirit and enthusiasm—I know, I was there—and even presented recommendations to the House in their reports. Before long, though, the Speaker was questioned about these recommendations, because of the convention of confidence and the fact that, it was argued, the government has to take the initiative when it comes to spending.

Mr. Lamoureux, the Speaker at that time, had to make a decision which, in terms of process, I still find difficult to follow. However, he was the Speaker and we are only the Clerks. Mr. Lamoureux had decided that the only power transferred to the standing committees where those that previously belonged to the Committee of Supply, that is

[English]

a power to reduce, negative, or adopt.

Well, members are not reducers. Members are by nature spenders, not that they come here with the intent of spending a lot of money. They have ideas on what to spend it on. There isn't a constituent you meet on the weekends when you return home who doesn't have ideas on where his or her taxpayer money should be spent.

Let's get back to the “why”. If the House is going to be held to the strict accountability concept that heretofore has worked, the concept that all it can do is reduce or negative, we are still where we were in 1968. I would predict that in the next decade, you will have another subcommittee like this one looking at some of the similar concepts that you're looking at now. You'll be looking at how and you will not improve the how until you address the “why”. You will not relieve that frustration that I know you're all feeling.

How can we address that why to change it? It's all there in the Catterall-Williams report, in my view. I know that in the government response to the Catterall-Williams report, the concept of reallocation was taken seriously, but it was commented that the convention of confidence was such that the government had some difficulty going down that road. That's the government response.

I say that if a government were able to enhance the powers of the committee, if another government were able to introduce the concept of referring bills after first reading and before seconding reading in the House, and if a government, this one, were able to allow private members, through the rules, to introduce a bill with spending provisions without a royal recommendation up to and including third reading, then we ought to be able to devise a formula where committees have some impact on the allocation of funding, using these reports to come to your conclusions, using these reports to hold the government accountable, to make some commitments on those allocations that the committees may from time to time establish.

• 1645

If I have one recommendation to make, it's that in the “how” that you are reviewing, you have to find a way for the committees to clearly state what their expectations are in the next round of allocations. Obtain a commitment on those allocations and then hold them accountable for it. You will do that only if—

Mr. John Williams: Could you repeat that, Mr. Marleau? I didn't quite catch it.

Mr. Robert Marleau: Clearly state what your expectations are in allocations, obtain a clear commitment on those allocations, and then hold the government accountable for them. You will be able to achieve that only if the individual sitting in this chair is the minister.

We've seen it evolve over the years. Ministers now—and this is not a criticism of these ministers, it goes back to the early seventies, 1975, 1976—come, make perfunctory messages according to what they're doing in their departments, the officials follow up, and subsequent meetings are with officials only. That's the pattern.

We need to return to the concept of the committee of supply

[Translation]

whereby it was the minister who was questioned, commented on the policies and made commitments.

If you don't establish that contract... I can say it in English, if you want.

[English]

If you don't establish that contract, then you'll be talking about “how” for a long time.

I think I'll leave it at that, and if you wish more details, my testimony of February 11, 1997, which I reviewed last night, is largely unchanged in terms of the times I've appeared before the committee as of today.

The Chair: Thank you very much for your thoughtful testimony. I'm sure there is a lot of conversation, and I think Mr. Williams would like to kick off.

Mr. John Williams: First, I have a technical question, Mr. Chairman, and that has to do with Ms. Barrados' point about the government moving to accrual accounting. I don't know how we intend to deal with the process of first identifying that the items in the Standing Orders, if any, are what have specifically to be changed.

Now, is that the role of the clerk's department? Who actually handles that technical analysis to say what needs to be changed with the proposals for change to handle accrual accounting, which is a totally non-partisan issue?

Mr. Robert Marleau: I have not reread the Standing Orders against the concepts of accrual accounting. I'm also not an accountant, though I don't apologize for that. I don't think there's very much that needs changing in the Standing Orders.

Mr. John Williams: But somebody has to do a technical review. That's my question.

Mr. Robert Marleau: My instincts are, without even rereading them, that it would require very little change. I'd be surprised if it required very much.

Mr. John Williams: Yes, because the business of supply is the allocation of taxes collected, and the the plans and priorities presented to us are going to be on an accrual basis, albeit it, I expect, with the accruals factored out—depreciation, interdepartmental transfers, and so on. I think it's not going to be a major issue to factor that back down to cash, as you know, Mr. Chair. But I do think that, one, we need assurance that the Standing Orders are in order for that.

The Chair: I believe we will have that assurance from Treasury Board, who will—

Mr. John Williams: Is it Treasury Board that is going to do it?

The Chair: I believe Treasury Board is going to bring some closure to the whole issue of the conforming of the accounting treatment of the appropriations.

Mr. John Williams: Okay. That's good to know. So we can put that technical part aside and say that's going to get done.

I'm interested in Mr. Marleau's point of addressing the “why” instead of the “how”. You know, you have to address the “why” before you can resolve the “how”. If he has been reading the testimony of the previous report, the Williams-Catterall report, he will remember, I'm sure, the long, fairly aggressive debates that we had back at that time about confidence, and so on. I think committees have to become more involved and have to realize that there is an opportunity to affect the outcomes.

• 1650

Yesterday I pointed out the fact that the Standing Orders regarding the motions for the adoption of the main estimates are, I say, turned around, upside down, because you deal with the main motion before you deal with the amendment, which is contrary to the normal way the House and anybody else deals with business. You deal with the amendment before you deal with the main motion.

Confidence comes in. Reductions are rebuffed. I wonder where we could find the motivation by the House to address collectively the “why”.

Mr. Dobell from the Parliamentary Centre had a meeting last week on the Hill and invited all parliamentarians to discuss the issue of committees, with about a 10% response participation rate.

Listening to my colleague on the other side of the table, there's an entirely different perception of even the role of Parliament when he's talking about whether we can build teamwork. Our role in opposition is to hold the government side accountable. You've talked about accountability and the definition of accountability. We're not here to be a team; we're here to analyse and debate the government's positions and proposals, not to endorse and jump on the bandwagon. So we already have an entirely different vision of why we're here. I'd like Mr. Marleau's comments on how we start addressing the “why”.

Mr. Robert Marleau: I don't think increasing the number of members in the House is a very palatable or realistic response in terms of resources.

I remember days as a committee clerk when the government backbenchers were quite keen on getting commitments in an accountability role as members of their own party, as members of the House, and as members of a committee, not necessarily a team role, but in a partnership role, sometimes with the opposition, in terms of effecting change in a government department in the direction of policy and the spending of the department.

There are some very important examples out there. One to which I would point was Joe Clark, the Minister of Foreign Affairs, and the foreign affairs committee of the day on overseas development spending, called the ODA report, I believe, where the committee really partnered with the ministers and set a sense of direction.

It's doable. It needs the political will of the minister at the outset.

Mr. John Williams: So are you saying the political will of the minister to understand that he should be, can be, and is prepared to be held to account?

Mr. Robert Marleau: That's right, and benefit by it, because the synergy that is set in place usually means there's a form of partnership, a contract, before the accountability becomes less adversarial—I believe that was mentioned as a concept—and more substantive. So it's doable within the system without necessarily changing a whole lot of standing orders.

We also have some experience in the finance committee, the whole pre-budget consultation process. It's not perfect, but here's a committee that has a mandate to at least try to help or give a contribution to the Ministry of Finance in the drafting of a budget, and to some degree engaging citizens in that concept, in that exercise. I believe one of the goals and one of the themes of the Treasury Board that was presented to you is that some citizen engagement would be desirable.

Honestly, all committees can't do that together. But going back to the Catterall-Williams report, the concept of a committee that would have the mandate over time to do some of that work, like the finance committee does every year, is going to cost money. The finance committee exercise for pre-budget consultation costs about $500,000. So if you're going to do this, it's going to cost money. It's going to require resources, staff, and some money. But if a committee, over the life of Parliament, on an annual basis, did that kind of exercise, including some citizen consultations, then those contracts will emerge.

• 1655

I think you cannot say in all objectivity on either side of the House that the finance committee has had no impact on the Minister of Finance over the last five years. You can criticize how much impact it might have had, and should have had, and didn't have, but I don't think you can say there was no impact.

So that's an element I think you need to revisit. The realities I outline in terms of time and resources prevent all committees from doing that all together in a one-size-fits-all exercise to be effective.

As to one committee with some stability in the membership, some stability in the chair, I point to the Blenkarn finance committee under the Mulroney years, where a real impact in many areas of financial policy was achieved because of the stability of membership, the stability of the chair. That contractual arrangement with various departments developed over time. But to expect to fan it all out to all standing committees and see substantive results, I just don't see it. The system has to change.

Mr. John Williams: So I take that as an endorsement of the notion of an estimates committee that's contained in the Catterall-Williams report.

Mr. Robert Marleau: It's not quite what I was saying in terms of endorsing that, but a concept along the lines of what the finance committee has been charged with.

It could be the natural resources committee, for part of a Parliament, that is charged with that particular exercise, if you want to choose one. Or it could be two or three of these committees in areas where there is a consensus to do so, to do that kind of long-term exercise.

Priorities change in the cycles and life of a Parliament. I don't think you could charge all committees or too many committees to do it. I'm not sure an estimates committee...which, as you may remember, finds its inspiration in the Huntington-Lachance report, entitled Closing the Loop. And I believe the Catterall-Williams committee looked at that, kind of a super estimates committee with a chair with a cabinet minister standing or salary and a larger staff.

I think with the progress that has been made through reporting to Parliament and the efforts of the Auditor General, the elements of what you're looking for are there. It's the priority setting and the contractual agreements on allotments of funds, priorities of funds, and accountability of that contract that needs to be delivered.

The Chair: Mr. Sauvageau.

[Translation]

Mr. Benoît Sauvageau: I only have one simple question. It's the same I asked Ms. Barrados earlier. Maybe you gave some explanations which I didn't quite get. For the committees to study the financial statements of each department, it's imperative that the government change the way committees operate. The way things are now, it can't be done. Is that what you said?

Mr. Robert Marleau: I said it couldn't be done because of the interpretation given to the concept of confidence. Limiting the power of the committees to reduce, negative, or adopt an allocation is not very attractive to members. It can be if it touches upon a current or a controversial issue and so on. You'd be quite happy to deal with those. That's what I will call budgetary opportunity. I have nothing against that, it's part of your life as parliamentarians. However, we have to re-establish the convention of confidence, so that committees can reach a consensus regarding those priorities used to allocate funds.

It's difficult for the government to accept that a committee has the power to change the way funds are allocated, but it would be possible without having to change the whole convention. For instance, when the estimates are tabled, the Treasury Board Minister could simply say that she commits herself to agree to a re-allocation of funds of 1 % for the National Defense Committee. There would be no need for a royal recommendation. It would simply be a political commitment. So what has to be changed in the Standing Orders boils down to not much. Rather, it's attitudes that have to change, I think.

Mr. Benoît Sauvageau: The will to do so.

• 1700

Mr. Robert Marleau: The political will, but on both sides of the House. The minister who makes a commitment through such a contract must be able to count upon some cooperation from the Opposition within the committees. He can't commit to such a re-allocation and then discover suddenly that, because of that commitment, other departmental expectations have to be reviewed. However, it can be done without modifying the Canadian Constitution, I think, and without changing the Standing Orders.

Mr. Benoît Sauvageau: And regarding the chairmanship and the...

Mr. Robert Marleau: Stability?

Mr. Benoît Sauvageau: Stability, yes, thank you.

Mr. Robert Marleau: That's quite a different thing. We know that during the 33^rd and 34^th Parliaments, under the Conservative government, Don Blenkarn, who chaired the committee, had quite a bit of influence. When Don Blenkarn started to review what the banks were doing, that got the banks, as well as the Finance Department and the minister himself, interested in the committee hearings. When he decided unilaterally to launch an inquiry on credit cards' interests rates, these rates fell by 3 points without Parliament having to legislate.

When he started reviewing the banking sector, suddenly, you could find in every bank brochures giving the cost of a cheque, of maintaining an account, of a withdrawal. All of a sudden, banks were at war, they made their costs public, each of them saying that it was the cheapest. However, no legislation had been passed. This is an example of the kind of influence a committee can have, if there is some cooperation between members when they review a particular issue. I'm convinced the same thing can happen regarding appropriation.

Mr. Benoît Sauvageau: Without any major change.

Mr. Robert Marleau: Without any major change.

Mr. Benoît Sauvageau: Perfect. No more questions. Thank you.

The Chair: Mr. Godin.

Mr. Yvon Godin: I'd like to come back to what you said regarding 1975, or thereabouts, when the minister—as you said—was accountable for his ministry.

Mr. Robert Marleau: Accountable, yes.

Mr. Yvon Godin: Since that time, has something really changed or disappeared? Was the law modified to devolve this accountability to committees? You were here before me because, in 1975, I was only a young guy working in Northern Ontario.

What would your recommendation be? Would it be better to go back to the way it was done at that time? Was it better?

Mr. Robert Marleau: No, things change gradually, I think. If you want to pinpoint the reason why it happened that way, it's because both sides of the House cooperated.

Following the minority government between 1972 and 1974, a period of time you have to exclude because, when you have a minority government, accountability becomes a bit more important, there was first the frustration felt by members, on the government side, but also within the opposition, regarding the estimates process.

In committee meetings, I have heard some members say that there were quite fed up with coming to hear the Minister without being able to do anything else but vote no. For instance, they didn't want to vote against unemployment insurance, when half of their electors depended on it. They didn't want people to think that they had voted against unemployment insurance. For them, it was frustrating not to have any influence.

With time, as issues became less important, the minister became accountable for less. So, there was a period when ministers didn't appear as often as before. They were replaced by officials. Then, around 1980, the Treasury Board started to realize that things were not quite right and to think: “Just a minute! We are not doing all that for nothing. We submit estimates to members to keep them informed. Why don't they get interested in what we do?”

So, around 1980-1981, they had their first try at changing the content of what we call the Blue Book, which went from two to eight inches thick, and to make this information more relevant and more transparent to members, in the hope that it would encourage them to discuss it at committee meetings.

• 1705

In 1985, following the McGrath reform, committees were given broader powers; among others, they were given the authority to launch their own inquiries because members were already using the Estimates' review to make such inquiries. For instance, when a committee was given the mandate to review the Canadian Heritage Department's estimates, its members took that opportunity to examine the new Museum of Civilizations, which was under construction. They went over the minister's files with a fine-tooth comb, they asked for copies of the contracts and so on. They decided to have quite a hard look at the Museum of Civilizations, instead of reviewing the department's estimates, as they should have. Maybe it was relevant to review expenses relating to the construction of the Museum, but the committee did not really study the department's estimates. McGrath wanted the committee to have as much as latitude as possible in the hope that they would, again, get interested in the estimates.

What happened between 1985 and 1992-93? All kinds of inquiries were launched, and the estimates were completed forgotten. Members are not interested in studying the estimates. As I mentioned to the members of the Finance Committee, it's much more interesting to study banking practices than the Finance Department's estimates.

Since 1993, the Conservative government and then, the Liberal government, in the context of their initiatives to improve reporting to Parliament, have tried to find ways to make these reviews as relevant, useful and interesting as possible. This is why we are asking you today to tell us what your expectations are.

Members would like some kind of a cherry on their sundaes. It's not necessarily what they get. We have to find a way give it to them and to develop a contractual approach with the ministers, so that you come back to the table with interest and a sense of commitment.

Mr. Yvon Godin: But what is the role of a committee? I'm going to give you an example, even if I'm off the subject, as I was earlier. It doesn't matter, anyway, because we are here to talk. Some of us are quite discouraged when we look at the way committees operate at the present time. If I were a government member, I would be even more discouraged. Instead of coming to committee meetings to listen carefully to what people have to say and to try, in a non partisan way, to come up with the best recommendations possible, government members come here with a mandate.

After the Fisheries and Oceans Committee tabled its report, following its trip to the Maritimes, its chairman was dismissed. Moreover, a member of the committee, who had made recommendations that were included in the report, which he had signed, had to speak against it in the House. What's the work accomplished by that committee worth? I don't blame those members for not wanting to come. Last Wednesday, they were complaining that the committees didn't work. It's all very well for us to work like mad, but if our work doesn't change anything at the end of the day and if the government and its ministers keep ignoring us, we won't accomplish anything. That's why government members are more discouraged than we are. We, at least, can go out of the room, speak to journalists during the scrum and complain; they, on the other hand, can't say a word and have to keep mum.

Mr. Robert Marleau: I'd say you're absolutely right.

Mr. Yvon Godin: Thank you. That's all then.

Some hon. members: Oh, oh!

Mr. Robert Marleau: And ministers are going to ignore you even more if they can't participate in your meetings.

Mr. Yvon Godin: No doubt.

Mr. Robert Marleau: I'm not trying to arouse the committees' wrath against the ministers, because there are some ministers, in this government as in previous ones, who are ready to build partnerships. It's just a question of selecting which ones and of developing them overtime. It's easier if the membership of the committees is stable, because it's in the context of a longer term relationship that you will come to trust a Sauvageau or a Williams.

Mr. Yvon Godin: I'm not sure it would be the case with a Godin, but anyway...

Some hon. members: Oh, oh!

Mr. Robert Marleau: This type of relationship can be built between ministers, opposition members and critics, but it won't be possible to do so if ministers don't participate in committee meetings and don't hear what you have to say. Do you think that ministers have time to read the minutes of your meetings? If a minister is briefed about what happened at a committee the day before, he is lucky. Time constraints and limited resources also come into play on the other side.

Yes, people get frustrated. It's a cyclical phenomenon. I saw frustration being expressed during many Parliaments. I'm going to give you another example which illustrates just the opposite of the situation you've just described. In 1986 or 1987, the minister wanted to modify the Broadcasting Act and had asked the Broadcasting Committee to review it. She had told the committee that she wanted to re-write the Act and to table a modified version in the House, and she asked the committee for recommendations. The committee submitted 88 or 89 recommendations. However, when the minister tabled the bill, members of the committee realized that barely six of their recommendations had been included. There was a riot within the government caucus. The minister was forced to withdraw her bill. She was summoned by the committee and forced to explain why she did not take into consideration recommendation 86, for example. Some members asked her is she was deaf. She was really given a hard time, as we say.

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When she tabled a new version of the bill, about 60 of the committee's recommendations were included. So you can do it, I believe; it's just a question of building that kind of a partnership and being able to count on the political will necessary to do so.

[English]

The Chair: Okay. Lots of memories, lots of stories.

When members of Parliament come here, there is a brief orientation. But in fairness, members of Parliament are not trained or oriented to the estimates and how to use them, etc. In fact, probably most members of Parliament, when they get their first set, feel it's like receiving your new set of telephone books. It's not an inviting document to read, even if you happen to be of a disposition to enjoy going through it, because it's ominous. It's not just that there might only be 180 members of Parliament to serve on all these committees, but we make a presumption that somehow there's the capacity or the knowledge or the ability to be able to utilize that tool.

So the House of Commons, in the first instance, does not establish the priority, or the significance. Once that happens at day one, the expectation that somehow we're going to be created into something that we're not is probably a truism. It just isn't going to happen, as you said. You said it the last time, and you're going to continue to say it. I don't think it has a lot to do with attidudinal things. I just think it has to do with culture.

Overlay that with elections, prorogations, breaks, changing of responsibilities, lack of continuity, etc., and all of the other attenuating distractions that go on in members' lives. The expectations with regard to the estimates are really a lot greater than I think they should be, given the fertility of the ground in which you're putting them. It's not a growing environment, I think.

I wanted to make that point because this is a very important assessment that I think we're making. We had the parliamentary Senate do their thing, we hear the cynicism, and everybody has their stories.

Prior to becoming a member of Parliament I was on the board of governors of a hospital, and under the Ontario Public Hospitals Act the board of governors was totally responsible for the delivery of health care, totally. That's where the buck stopped. They were volunteers. All of that responsibility, however, was seconded to the medical officer of health, to the director, to the president of the hospital and to others. Our job, really, the secondment, was to make sure we had people in place to do those jobs on our behalf. That's how the responsibility of the board was discharged. Otherwise, it was mission impossible.

Here, because members of Parliament come from such different backgrounds, I think they come into a culture where there is a presumption that somebody's doing all this. We have orders that if a committee doesn't look at the estimates, they're deemed reported. Somebody must have looked at them, because it's not important for us to have looked at them. Those are bad signals.

All I'm suggesting to you, and I'd be interested in your comments, is that I don't think the starting point here is good. I don't think the ongoing support of Parliament is there for the members to do anything different, so the expectations are simply unrealistic.

Mr. Robert Marleau: Again, I would have to agree with you that the expectation is considerably unrealistic. That's why I tried to identify those two realities of time and resourcing that are there, and they're not solvable. Throwing more money at this is not going to make for a better estimates process. Throwing more research staff is not necessarily going to make for a better estimates process.

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The Chair: All right. Listen, we—

Mr. Robert Marleau: But I want to get back to the board of governors concept, which is a little bit different. What you have in our system is government in Parliament, not government by Parliament. That's an old bugaboo with me. The role of the House is not to develop policy, it's to scrutinize it. It's the same thing with the estimates.

I'm not for a minute suggesting that the government ought to delegate to parliamentary committees their responsibility for the roll-out of spending, but that the contractual arrangement that can be developed will bring you, as an MP, to the table more interested in doing the job of estimate scrutiny than the present circumstances do, where there is really nothing in it for you. You're not going to get elected on the basis of your scrutiny of the estimates.

Some hon. members: Oh, oh!

Mr. Robert Marleau: I've never seen a member who was elected because of that.

The Chair: It works the other way as well, because a member of Parliament has actually seconded the responsibility to make sure there's accountability and transparency. We've implicitly seconded that; somebody else must be doing this as far as the examination of the telephone books.

Mr. Robert Marleau: Again, I go back to my analogy of question period. The fact that it's there is what's important and the fact that it's accessible is what's important. You just don't have time to ask all the questions.

The Chair: Okay. I want to just ask one question.

Some committees in Parliament actually have been very productive and have done some excellent work, whereas others are totally dysfunctional, and we have everything else in between. So it can work. And you gave an example of the Blenkarn committee.

Mr. Robert Marleau: I'm deliberately staying away from some in this Parliament.

The Chair: Sure, I understand that.

A voice: Where is Blenkarn now?

The Chair: In Mississauga South, of course. I saw him yesterday at the service.

In any event, members of Parliament through their committee work, quite frankly, have been quite productive in many areas, and it has not been as a result of looking at votes in the estimates. It has been as a result of analysing policy, platform, programs, relating them to their own experience or to their research and stuff, and trying to shape or direct or fine-tune somehow some niche within policy. They get tremendous satisfaction from that, because there's some ownership there.

I can't recall, but I think Mr. Williams said previously that the history of reviewing the estimates shows that the success of changing the estimates has been negligible or negligent...well, just negligible—maybe negligent as well. Even if you were to change any aspect of the estimates—I think it's limited to 5%, in any event—even if you were to make some minor change there, it may not result in changes in terms of direction of government, of policy, of objectives or possible outcomes.

If the objective of the exercise is to provide better financial recording information to Parliament so that if, as, and when someone needs to use it, we know it's there and it's on a consistent and compatible basis with everything else that we do, but don't consider that to be the only tools we have to work with—our tools are much broader than that—does that...? Are we totally preoccupied with the estimates as being a...?

Here's where I want your comment. Does our failure to utilize the tools provided by the estimates put us at great risk, modest risk, or minimal risk? And is there an upside or opportunity that we're forgoing that means we really should reassess our commitment to making the estimates review process more rigorous and more meaningful? In 25 words or less.

Mr. Robert Marleau: Well, in 25 words or less, no. That's the short answer.

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I don't think that by just addressing the “how” you can turn this around. By addressing the “how” you can make it more readily available when you decide you want to do it, or when you need to do it. But by simply looking at the “how”, the format, I don't think so.

By readdressing the “why”, you're doing this. Then I think you can better tailor some of this stuff to your objectives. Your objectives come from the “why”. Your objectives as they're stated, if you like, as a member of Parliament to do this better and more effectively or bring some meaningful content to this review—I'm not sure that's your objective. It may be the objective of the Auditor General—and God knows, he tries—but as a member, I'm not sure that's necessarily your objective. You want change. You want impact. You want effect. At least that's what I believe I've seen members do over the years. And you want it timely and you want access.

The Chair: Are there further questions? Mr. Williams.

Mr. John Williams: Thank you, Mr. Chair.

Mr. Marleau, I appreciate your great and welcome knowledge in this particular area. We've had these discussions before, both on and off the record. It seems to me that what you're saying is that it requires a change in culture in Parliament more than just a change of the rules. You mentioned that the confidence procedure as it's currently perceived prevents this government and previous governments—it's not just this government—from tolerating any reduction at all.

We have the rules regarding the approval of the main estimates written in such a way that it's virtually impossible to make any change whatsoever. As I said yesterday, the last time we had a change was in 1972, when somebody had a bee in their bonnet about the president of the CBC and knocked $1,000 off his salary. But what did that accomplish as far as Parliament having an impact on policy? Nothing whatsoever.

You talked about the committees having a contract with the minister. I think you're talking about a relationship with the minister where each, the committee and the minister, enjoy confidence in each other, and by virtue of that confidence in each other that's established through developing a relationship, each can appreciate the other's point of view, which in turn can lead to constructive criticism that is appreciated and perhaps even adopted. But again, that's not a rules change; that's a culture change.

Mr. Robert Marleau: It's accountability.

Mr. John Williams: Absolutely, it's accountability. But it's not a rules change; it is a culture change. And I think that has been the crux of your presentation this afternoon. Am I correct in saying that?

Mr. Robert Marleau: Essentially, yes. But it's not just culture on the ministry side.

Mr. John Williams: No, no.

Mr. Robert Marleau: I want to make that clear.

Mr. John Williams: I did not say culture on any side. I just said a culture change both by Parliament and by government. I appreciate your point—and I heard it from you first—about government in Parliament rather than by Parliament. I think it's a fairly profound statement, that we perceive it that way.

But while we have government in Parliament, it's still a fairly significantly adversarial relationship in perhaps that lack of mutual trust. I've heard it said, “You know, all the opposition does is filibuster”. Well, that's about the only thing that opposition has left to do. You hear that the government members vote for the government's position, regardless of their opinion, and that perhaps is all they feel they've got left to do.

The point is that Parliament has become dysfunctional. It has lost its vision, its raison d'être of why it was created, which was for parliamentarians, in essence without a significant political attachment to defending the government, to hold the government accountable. That was the fundamental and original role of Parliament, and we seem to have lost sight of that. We have a large number supporting and a large number who just attack for the sake of attack, and there's no real opportunity to build this contract, whereas if there is confidence, accountability, it flows from that point.

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Mr. Robert Marleau: I have a short comment. I'm not sure I join you on the word “dysfunctional”. As an officer of the House, I find it functions with a strange dynamic, maybe, but the last two Parliaments have been different. Five political parties do bring a different dynamic, and demand a different set of chairing skills—you get right down to that basis—from a three-party Parliament. We have to look at that context as well.

The Chair: Okay, we have one more questioner: Mr. Ianno.

Mr. Tony Ianno: Thank you.

I guess I'm an optimist and not a pessimist. I think Mr. Williams has been around public accounts too long, because there are many committees where the opposition and the government members actually work well together. You referred to some from past Parliaments and many from this Parliament. The industry committee worked on many good projects, and the partisanship went out the window, because often we were working toward a goal that seemed to cross party boundaries, including the Bloc's.

I believe there is an opportunity to change the system, change the culture you were referring to. I tried the question on the Auditor General's people, as you heard earlier, and they don't want to bite. In the end, they somewhat agreed that changes had already taken place, but that wasn't where they started from in the original part of the answer.

I believe there is the possibility of taking the parts that work and expanding them. The question is, how do we make it work and how do we expand it, with everyone participating in the process up front, as you were indicating, having the ministers come in?

In some of the work we did in the past with John and others—I forget the title of our group, performance enhancement etc.—we talked about how possibly, when we have the minister in when we are setting the goals, it wouldn't have to be exactly the way the committee would recommend, to get a sense of where we would like to see some things go. It could be specific projects within the department versus the whole overview, because there are philosophical differences within parties that have to be taken into account.

Having said that, by doing that, we could have the bureaucracy come into that process and try to work with us on that, to the point where the minister was actually on our side of the table as a parliamentarian, compared to the department, so he would have to defend or espouse, whatever, what the bureaucracy wanted.

Perhaps when the goals are being enacted or attempted, we will have more....not just the one time you were referring to when the minister comes in, gives his little blurb and then disappears. We will see some of that activity take place, and the opposition, with us, work to when we see the bureaucracy not achieving it. Some things change in the format, different goals come into play—lack of money, or something has materially changed the process. So we don't say “You didn't do it, and you said you were going to do it”, and therefore, end of the world. No.

Something has changed. How are you going to adapt with us that process so that in effect we change the direction we were going in, because we saw a roadblock? You're not being held unaccountable in a negative way, but are more commended that you actually worked with us in the process.

I believe it's doable, regardless of which side of the House we sit on. There are issues that go beyond government trying to defend a process, because there may be 30 years' worth of issues in government, per se. Maybe all parties want to see some of them change, but somehow they don't. Do you see that as something that is doable, as compared to just being idealistic?

Mr. Robert Marleau: I don't think it's idealistic at all. I listened to the testimony earlier about how there has been change—and there has. It's very positive. There's no question that departments are now talking about performance, rather than money. Over the years, estimates were more than last year, less than the year before—that was the discussion. You're now talking about performance and you're aiming at results.

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I think if committees focused on results as a contractual relationship with the minister, rather than the dollars in the estimates, they would say “Okay, we're going to go along this year for this $3 million, whatever it is, but here is the agreed-upon result, our expectation as a committee, and your commitment as a minister.” Or maybe you would concur with the minister's expressed results and focus on those results in the follow-up exercise, rather than just expecting there would be scrutiny of the estimates.

I think Mr. Szabo said it's idealistic. It's where Parliament started. The king took your cow, fed his soldiers, went to war, didn't ask your permission. Well, you can't count all the cows any more. That's a fact. But if you focus on results, then whether you win or lose the war is pretty important. To some degree, you have to get back to that contractual relationship. I don't think it's idealistic or overly optimistic. Committees have done it before, and they can do it again.

I'm just concerned about the over-focus on the “how”. If you think that dimension is going to solve the frustration you all feel, it won't happen just by more reporting, more timely reporting, a longer cycle, a better cycle, or a bigger committee.

Mr. Tony Ianno: Leave that to the accountants.

Mr. Robert Marleau: Yes, I agree.

The Chair: The bells are now going. It's a fifteen-minute bell, so we should probably wrap it up at this point.

Mr. Marleau, Mr. Corbett, thank you very much. This subject matter certainly has no end, in terms of discussion, but I think we've had some thoughtful input.

Our next meeting will be on Tuesday, May 30, the second day after we get back from the break, at 3:30, Room 307 West Block. We'll be having the Parliamentary Centre, who just had the round table with the parliamentarians with regard to the committee process, etc., and the relevance of parliamentarians. Treasury Board will also be on the panel, as well as a representative of the Senate.

At the meeting on Wednesday, May 31, at 3:30, in Room 306 West Block, we will have our first opportunity as a committee to start discussing among ourselves the specific proposals that have been put before us. So we're going to target for that. We also hope to have, at that point, a skeleton of a report, so we have an idea of what blocks have to be filled in, for your input.

There being no further matters, we're adjourned.