Proceedings of the Standing Committee on
Internal Economy, Budgets and Administration
Issue No. 9 - Evidence - February 9, 2017
OTTAWA, Thursday, February 9, 2017
The Standing Committee on Internal Economy, Budgets and Administration met this day at 9:04 a.m., in public, pursuant to rule 12-7(1), for the consideration of financial and administrative matters; and in camera, pursuant to rule 12-7(1), for the consideration of financial and administrative matters.
Senator Leo Housakos (Chair) in the chair.
[English]
The Chair: Good morning, colleagues. I would like to welcome everyone to another Internal Economy meeting.
Before we get into the agenda, I would like to introduce to everyone our new Deputy Law Clerk of the Senate, Jacqueline Kuehl. She has only recently joined the Senate. On behalf of Internal Economy, we would like to welcome you to our clerk support. Welcome.
Colleagues, we will go to the agenda now, item 1, the adoption of minutes, proceedings of the February 2, 2017, public portion. Senator Jaffer moves that the minutes pass. Do I have a seconder? Senator Wells. Thank you, colleagues.
Item 2, update on the Working Group on Senators' Services. We have with us, of course, Blair Armitage. All of you know Blair, who has been heading this committee. Blair, of course, is the Principal Clerk of committees, and does a fabulous job at that. We have with us Lou-Anne Bégin, co-chair representing the Conservative caucus and Executive Assistant to the Honourable Senator Poirier. We have Amanda McLaren, Co-Chair representing the Independent Senators Group and the Parliamentary Affairs Advisor to the Honourable Senator Dean; Sherry Petten, Co-Chair representing the Liberal Senators and the Director of Issues Management for the Honourable Senator Terry Mercer; Jim Manigat, Working Group on Senators' Services Coordinator, and Policy and Projects Officer in Audit and Planning Directorate. They have done quite a bit of work, for quite a while, and I thought it would be helpful if they give a brief to the committee.
Blair, take it away.
Blair Armitage, Principal Clerk, Committees Directorate, Senate of Canada: Thank you, senator.
This working group is a decision of this committee created in June 2015 after a really successful project that was initially led by Nicole Proulx to get staff from senators' offices and the administration together to build collaboratively what is now known as the Office Portal. It was a way of making sure that the staff in senators' offices who needed this the most could use it effectively and well, in service to their senators. It was such a success that we received a presentation. Amanda was one of the original members of that collaborative group; and she, with somebody from the administration named Miranda Edwards, did an extraordinary job of just naturally working well together and bringing in staff from other senators' offices who were interested in this, and the end result met everybody's needs. The administration was helped by being able to provide your offices with information, and your offices could find information really well.
We found that the model of creating focus groups and inputs from senators' offices was something that was probably largely missing from a lot of the policy development and a lot of the program implementation that was going on at the time, and that was a message that was received loud and clear by the administration at the time. That's why it was brought forward for a decision of this committee that we formalize this relationship.
These co-chairs — as I said, Amanda has been with us longer than anybody, except Nicole — are the spokespersons for these projects back to their respective caucus employees and senators, to let them know what's going on and to encourage participation in the specific projects.
The projects themselves are led by other individuals than this team. There was a recent on-boarding exercise, or orientation exercise, created for new staff in senators' offices. It was implemented in January over the course of I think two different sessions, and the feedback was really, really strong. It was led by an outgoing officer in human resources, Hélène Hubert, but the team profited greatly from the input received, before the programs were rolled out, by the inputs from the different senators' offices.
You have a briefing note in front of you with some of the accomplishments and some of the projects that are going on. We're trying to create a portal similar to the office one for procedural elements, to help your staff help you in your work on committees or in the chamber, or parliamentary associations. It's being led by Jessica Richardson, whom you may know from the Legal and Constitutional Affairs Committee. And we have a few other things going on.
One of the most important inputs that we're getting is — well, perhaps Amanda can speak more to this — how important it is that they have a forum to bring observations, complaints and frustrations so that I can disseminate them to the appropriate directors and maybe nip issues that might arise them in the bud. An example of that is the Employee Awards Program. I think we're going to do some self-reflection on that using this model. Certainly I, as the chair of the charitable campaign this year, will be using this group to make sure that we're meeting the needs of senators' offices and bringing them in far more than they feel they have been in the past.
I would prefer to let the members of the committee give you an impression of what they have experienced and any issues they see going forward.
Amanda McLaren, Co-Chair representing the Independent Senators Group and the Parliamentary Affairs Advisor to the Honourable Senator Dean: Thanks, Blair. I don't really have too much to add. I'm pleased with the direction the group is headed in. As Blair mentioned, this group serves more than just the special projects working session. We also are trying to break down the barriers that exist between the administration and senators' offices, which, throughout my years here in various offices, I have found to be a bit of a challenge. Otherwise, I think things are moving very well.
We have had Lou-Anne join the team — which is great; she brings a fresh perspective — as well as Sherry, who is a veteran of the Senate but new to the working group; and of course Jimmy, who has been excellent as our coordinator. Thank you for your support. That's pretty much all I have to say.
Senator Jaffer: I appreciate what you have done here. It's helpful, and we have certainly come a long way. Thank you.
Chair, since I have come to this place, my one frustration has been that there are no ongoing courses for senators. It feels like you come here and you die; you get no more training, literally and otherwise.
There have been some courses — like the fundamentals of speech; and tomorrow, how to use the library — which I really appreciate, but it would be very helpful if we could work with you and have some senator-specific courses so we can also grow. There are a lot of computer issues, lots of things happening, but we are sort of not able to keep up. In your further work, can you look at what kind of training we can have with senators so we can also grow in this job, please?
Ms. McLaren: Yes, absolutely. I will respond to that. We've recently identified that there's not a lot of ongoing training for staff themselves, but absolutely I think as an extension of the orientation sessions that we have had successfully in January, that's something we could consider moving forward. It is very important that senators themselves stay up on the training as well.
Senator Jaffer: Thank you.
The Chair: Senator Jaffer, I'm surprised you would want to be even busier than you already are.
Senator Jaffer: This would help, so I wouldn't be busy.
Senator Marshall: There was some discussion last year about setting up training programs for senators' staff with regard to setting up senators' offices. It had been discussed now a number of months ago. Is there any progress on that? We have quite a few new senators, and even for myself, I would find it very helpful if there were some sort of training program with regard to a template for even how you would recommend that a senator's office be set up.
Ms. McLaren: As I mentioned, we just completed the orientation sessions in January. That was part of a three-day project led by Hélène Hubert in Human Resources.
Senator Marshall: Was that the on-boarding program?
Ms. McLaren: Yes. With the on-boarding program, we had presentations from all the directorates in the Senate. We had a presentation from IIA, Finance, Human Resources — everything that you need to run a senators' office. Every staff member was invited. There was quite a lot of participation.
You might be able to speak to it better than I would, Jimmy, but overall it was successful. From those orientation sessions, we got a lot of feedback that it would be helpful to offer this on an ongoing basis.
But I might ask Jimmy to speak to it.
Senator Marshall: Was the intent of the on-boarding program to satisfy the requirement that was identified last year with regard to training in senators' offices?
Jimmy Manigat, Working Group on Senators' Services Coordinator and Policy and Projects Officer, Audit and Planning Directorate, Senate of Canada: If I may, senator. It was partially part of this program, but also an extension of this program will be something that is fairly new. We are engaging in an ambassador program with the staff and the co-chairs through HR to better follow up with this three-day orientation.
Just to keep up with the new appointees and staff coming on board, we are working on — it's at a very early stage — a larger program that will follow these newcomers on the Hill throughout the process. There are different phases, but orientation was the first step. We are continuing with a lot more coming soon.
Senator Marshall: Okay, thank you.
[Translation]
Senator Dupuis: I must say I nearly envy my assistant, who attended that orientation session. I can confirm that the session was most useful. I had understood it to be a working group on services available to senators. In my opinion, it would be useful for newly appointed senators to receive some kind of Senate 101 manual, which could be called Welcome to the Senate, you are a new senator.
I could be a virtual manual, a list of legislative and administrative documents, or links to useful websites. I know the Senate website provides us with all kinds of information, but not in a particularly organized manner. You may choose to begin at the first tab, but you will quickly realize that if you click on all the tabs, it will take you years and you still will not have a full picture.
I suggest we develop such a tool, just as we received a checklist to remind us to bring our health cards and a void cheque. What did reassure me was when several senators told me: "Welcome to the Senate. It's the only place you can learn to do your work. There is no training program for this.'' I think such resources could be useful for senators too.
[English]
Senator Mitchell: I congratulate you on your work. Having said that, this is an opportunity for coordination. In a way, we're starting to develop some parallel things between the two silos, and people have been talking about that, and I think you're working to break down the administration silo and the senator silo. It's very important that we bridge that gap.
The work that was done by our working group on the orientation of new senators — Senator McCoy, representatives from each of the caucuses and I, with staff, developed an orientation program, which most of you are aware of, that I think was very successful. We did 101 for senators. We're going to do the next level.
However, out of that we began to develop — we talked to Luke and Senator Tannas — and also I mentioned some time ago this idea of having a Senate subcommittee on professional development, as it were, which would model the very successful communications subcommittee.
What you are doing, I believe, needs to be informed by direct and ongoing senator input, and there are three pillars to this: There is the orientation and ongoing education for senators, as Senator Jaffer has emphasized; there's orientation and ongoing professional development for senators' staff; and there's also Senate administration, and I don't know very much about it because, again, we don't get to look into it all that much.
This kind of a forum is useful — you present to us — but it isn't a working-in-the-trenches, day-to-day driving kind of input from the senators.
We need to coordinate those two things. Senator Tannas has said that he would invite Senator McCoy and me to the human resources subcommittee to talk about how we can begin to develop this structure and these three pillars in an effective, coordinated way between the Senate administration and senators and their staff.
Senator McCoy: If I could piggyback on what Senator Mitchell has said, I think it's a very good suggestion that Senator Dupuis just made. We will follow up with you to include that in the orientation and professional development work that is being done.
Senator Dupuis: If I may, very briefly.
[Translation]
As a new senator, it is clear to me that this is an institutional responsibility for the Senate. The preparation of senators should not depend on initiatives by each caucus. All I wanted to say this morning is that I consider this an institutional responsibility of the Senate. Thank you.
The Chair: Thank you, senator. Thank you, Blair, for your work.
[English]
And thank you to all members of that committee for your work. It's appreciated. We are here, Blair, to get more guidance from you on these issues as well. Thank you.
Item three on the agenda is the ninth report of the subcommittee on budgets.
Senator Tannas: Colleagues, we have a very brief ninth report where we're recommending the release of $16,700 in aid of the Aboriginal Peoples Committee's study on best practices and ongoing challenges related to housing in the North. This report obviously has the budget already approved to be translated in English and French. The committee has asked us, and we agree and recommend, that we expend the additional funds to have the report translated into Inuktitut. This is a Northern housing report, widely anticipated by people in the North, and we think it's a good use of money.
Senator Marshall: Could you give us a brief update on where we are with the overall budget?
Senator Tannas: I can.
Senator Marshall: Good.
Senator Tannas: At this stage, we have clawed back $394,681 in expenditures from committees that have already travelled. At this point, we have $1,277,000 of funds remaining for the fiscal year, and there are still four or five budgets that need to be applied.
So we will be under budget to the order of some hundreds of thousands.
Senator Marshall: Okay, so we're not even close?
Senator Tannas: Not even close.
Senator Marshall: Thank you.
The Chair: If there are no other questions, colleagues, Senator Tannas, are you moving a motion?
Senator Tannas: I am, sir, yes.
The Chair: Is it seconded by anybody? Seconded by Senator Munson. I assume we're all in favour of this, colleagues?
Hon. Senators: Agreed.
The Chair: Thank you.
Item four is an update on the audit subcommittee. As we promised last week, we requested Senator Smith give us an update, and Senator Smith is before us today.
Senator Smith: Thank you, chair. Senator Batters, Senator Campbell and myself have held numerous meetings. Let's see if I can position it. The Auditor General's report suggested that we would create what they call an audit subcommittee, or it would be called an audit oversight committee. The Auditor General, when he made his conclusions, suggested that we needed to create an independent body and that body would comprise a number of senators and a number of outside people.
I'm not being specific because the Auditor General had a certain position and our job was to try to develop a position from the Senate that would address the recommendation made by the Auditor General.
What we have done, with the support of Michel Patrice working with the finance group, is create a template, if you like. We have had meetings with the various heads of the caucuses and the independent groups, and we're in the position now where we will have a report which we will get out to the members of this committee. But I think before we actually get that report to the members of the committee I'd like to have more of a formal meeting with the heads of the various caucuses and groups together so that we can review what we have done and have a discussion amongst the six or seven people — senators and colleagues — and then we can come back to this group and review it as a group here. And then the next step, I would assume, if we had an agreement, is that we would take that into the Senate itself to discuss and debate. That would be the format of what we'd like to accomplish.
Now, timing-wise, I have met with various people representing the groups, and I know your schedules are very busy, but if we could have a meeting around the middle of next week — and don't look at me strangely if I say the wrong time, but something like Wednesday at noon — the noon to one o'clock period seems to offer good availability. I would organize a meeting where we'd have Michel with us, the individual people that I have met so far and probably the Speaker and Senator Housakos, and we'd spend an hour together to go over exactly what we have come to.
Because there is one major question, which I don't think is a surprise to anyone, is the actual position of the chair. That will be a major discussion point: who do we pick; inside or outside, and how do we look at the control and supremacy of the Senate.
That's a bit of an overview. For the people that I have seen before, I will contact you very, very shortly. Our objective is to get a report out to you so that we could meet at the middle of next week. Upon completion of that meeting, we have a break, but what we would do is get the report then into the hands of the members of this committee so that in the first week back from our break we would be able to have a discussion in this room with all of the people who are here now. That would be the concept of the audit oversight update.
I also have a few notes which we're distributing to you, because a question that was brought up last week was the issue of audits within the Senate finance group. I have a few speaking notes, but I have given you some pieces of paper. Here we go.
Honourable colleagues, I am pleased to provide the committee with an overview of the various audit activities related to the Senate within the last five years and its cost. This was the question that was raised last week.
The Senate has spent an estimated $683,037 on audits dating back to April 1, 2012. I will qualify this by saying that this is a direct cost of contracts with firms hired to conduct audits or examinations and does not include the cost for functional reviews, such as the one on communications or human resources. Further, these figures don't take into account the costs of our staff, both in our offices and in the administration involved in these activities. The $683,037 does not include spending by the Office of the Auditor General on the audits of senators' expenses and on Senate administration.
However, it does include $527,096 for the independent examinations by the firm of Deloitte for the senators that were reviewed — I don't think I need to name the senators again, because that's public knowledge — and the review of travel expenses and living allowance for the claims of one senator.
In total, $120,975 was spent to audit financial statements of the Senate, which averages out to $24,195 per year, and that is with KPMG, who have, I believe, done our audits for five years.
In 2012-13, an amount of $33,371 was spent on advisory engagement on project management. Now if there's anyone, like Nicole or Pascale, who could give us any specific feedback on exactly what that was, that would be appreciated, if you remember. If not, maybe we'll note it for the next meeting and you could give us that feedback.
In the same year, there was an amount of $1,595 to close out an audit of partnership agreements, whatever the partnership agreements are. They could have been from our previous audit firm that was working with us; it could have been the completion of that.
That's the overview of what was spent and the issues concerning audits that were brought up last week by one of our senators.
Senator Marshall: Thank you very much, Senator Smith, for that update. I do have a few questions. Do we have an internal audit group now?
Senator Smith: As part of the Auditor General's recommendations, we had discussed the issue of internal audit, and one of the things that will come up in the audit oversight committee will be that particular subject. I think it's also important to discuss it with Nicole and her group so that there can be input from the finance group itself so that the proper balance exists and we don't get something that's out of kilter if we suddenly say, from an audit oversight committee, "Let's have this particular internal audit function.''
We had an internal audit function that I don't think was as clearly defined, at least recently. I'm not sure — did we have anyone in an internal audit function?
Senator Marshall: Do we have any internal auditors now?
Nicole Proulx, Chief Corporate Services Officer and Clerk of the Standing Committee on Internal Economy, Budgets and Administration, Senate of Canada: No, we don't.
Senator Marshall: Okay, we don't have any. I wanted to raise the issue. I know that there are differing views with regard to the audits, but I'm very supportive of having internal audits done on an ongoing basis. We haven't had any for the past three years, so we're moving into the fourth year.
The audits are almost like a protection for ourselves, too, because we have been through a very difficult time with regard to the Auditor General's audit. Now we're into our fourth year with no audit activity going on with regard to our expenditures, and I certainly don't want to go through what we went through a couple of years ago with the Auditor General coming in and doing an audit.
My preference would be to have someone come in, you know, even if it's our own staff, and review some of our expenditures. From a personal perspective, my understanding is that nobody's gone through my claims, except the Finance Department. I would really appreciate having somebody independent go through my claims so that whatever I've been doing wrong the past four years can be corrected so I don't continue into eternity, or until the next audit by an external organization.
I want to put it on the record that I'm very supportive of having routine internal audits done. Thank you.
The Chair: The suggestion is noted, Senator Marshall. I want to add to that, for the information of all of our colleagues and the public, indeed, we haven't had any internal audits over the last three or four years, but over the last three or four years senators have been disclosing information publicly like we never have before, so I think we probably have been audited by people in the press gallery and the public on a regular, daily basis. We were always hopeful that our platform for full disclosure would be more thorough and cost-effective than the $27 million of the Auditor General, but your point is well taken.
Senator Marshall: I would rather have the questions come up from the internal auditor rather than getting calls from the media.
The Chair: Indeed.
Senator Batters: I have just a couple of quick points further to what Senator Smith was saying. What I wanted to point out on that chart is that out of that total of $683,000 for the last five fiscal years, it's important to note that for the last three fiscal years the amount has only been the KPMG's frankly very small amount of $25,000 each for these audit activities. As Senator Housakos just mentioned, of course, going along with that is the massive amount of the Auditor General's cost, which is listed here as being $23.4 million; that's the last reported number on their website but some media reports have set it as high as $27 million.
Senator Lankin: Thank you very much. I want to follow up on Senator Marshall's suggestion around internal audit, just to understand what the history was. I thought I heard this question: Do we have any internal auditors left? I wasn't sure what that was referring to.
In general, I'm very much in favour of having an internal audit function — not having internal audits done by our staff, but setting up that function and that function having a direct reporting relationship to the audit committee and having an opportunity to look not just at senators' claims. I take your point, Senator Marshall, but at various points in the operation it's a partnership with the organization that can help improve, on an ongoing basis, what we're doing and how we're doing it.
If there has been discussion of this in the past and if there are things that I don't understand about why that function doesn't exist, I would like to understand, but in general I'm very supportive of that.
Senator Mitchell: Not to pile on, but I would like to reinforce and emphasize the points made by Senators Marshall and Lankin. An organization of this complexity, sophistication and history absolutely needs an audit function and it would work in two ways: random audits, as it were, but I also would like to have someone we can go to and say, "Come in and audit and tell us if we're doing everything exactly the way it should be done.''
I would also like to make the point that it would be easy to think that the internal audit oversight committee is going to fulfill this audit function we're talking about. I don't see that at all. I see that being a very high-level and sophisticated committee that gives us direction, policy advice, consults and assists us in how we conduct this committee's fiduciary responsibility in a sophisticated, board-like way. It won't be doing nitty-gritty office internal audits. I believe we absolutely need that function fulfilled, notwithstanding what you said, chair, which is a strong and good point, but I think having that would strengthen the way this organization runs.
The Chair: Colleagues, I also don't want to pre-empt the proposal and the good work from Senator Smith's group that is going to go to all the caucus groups for review on this oversight body. I suspect you will find some of these questions are being addressed. In terms of the budget subcommittee, right now it would be rolled into this oversight body, so that they would be undertaking a lot of these responsibilities that the budget audit committee is handling right now.
Colleagues, the other thing is we can also give this oversight body the parameters we wish to give it. If this needs to be one of the parameters we want to include in their responsibilities and roles, it would be up to us, as senators, to determine how broad we want it to be or not to be.
Senator Marwah: As Senator Mitchell said, not to pile on, but I would tend to agree. I think that for an organization of this size, and given that we work with public funds, it behooves us to have an audit committee and function. Not only that, it should be two things: It should be independent, and we should debate what "independent'' really means and the scope of that independence, and the scope should go well beyond just looking at expenses. It should look at matters pertaining to the broader functioning and expenses related to the Senate.
The Chair: I would remind colleagues we do an annual administrative audit here. Our administration is audited on an annual basis, so let's be clear about that. I think Senator Marshall was talking about auditing of senators' offices; is that correct?
Senator Marshall: Everything.
The Chair: When I say "everything,'' that's the only element now that's not being audited on an annual basis. Our administration is.
Senator Marshall: I would say that the financial statement audit by KPMG is only a financial statement audit. I would expect our internal audit function, when we have one, to audit not only senators' expenses, but all aspects.
Senator Tkachuk: Just to give a little bit of the history of this, I think previous to when Senators Furey and Stratton were chair and deputy chair, they had an outside auditor come in previous to the 2012 Auditor General coming in. That was the first audit of senators' expenses since 1991, and they did it in preparation. It was quite a scathing and tough report; it led to a lot of reforms and changes and we received quite a bit of media blow back on it.
That was in January 2011, if I remember, and then the Auditor General came in 2012, did a full audit and then, of course, the scandal really led up to the Auditor General doing another one of senators' expenses. I think, and I believed at the time, we should do an audit of senators' expenses every five years. We should have an outside auditor. It doesn't have to be the Auditor General, but it should be an outside auditing firm doing one of senators' expenses and a regular one on the whole Senate and report to an audit committee.
We can have an internal function as well, which can be ongoing and would be helpful. That's really what an audit is supposed to do: help the administration make things better and help senators improve their lives, rather than waiting to turn it into a huge media operation, which is exactly what happened because an audit had not been done for so long.
Senator Wells: Thank you, chair. I think people are forgetting, or perhaps not remembering, that we've done a full revamp of our systems based on the Auditor General's recommendations.
We've done a full procedure and practice revamp in the finance directorate. We do systems audits and then we publicly disclose every cent that we spend. I can only speak for my own office, but I have no doubt that what I spend, how I spend and how I report fits within the systems that we set up. Then, the final check is the public check, which is going public on the website.
I don't know if we have to continue layering audit functions that are fully redundant, with the systems that we have, based on what the Auditor General recommended a year and a half ago.
And I think if anyone doesn't have confidence in how they're doing their expenses or spending public money that there is budget within their own office to have someone come in and do a fully independent look at how you spend your money or how your systems are set up.
[Translation]
Senator Dupuis: I would like to have a better idea of what is currently going on with regard to audits, be they internal audits or audits carried out by Deloitte. As new senators, we would like to understand the current situation.
What strikes me is that we often hear of certain steps that have been marred with scandals and problems. Consequential measures were taken thereafter, but it is not clear what these measures are and how far they go. We therefore feel like we are before a puzzle where various audit functions are already in place. However, if we want to have a better grasp of that which will be necessary to rectify current shortcomings, we cannot answer the question. I wonder if it would be possible to get a table or a list of what already exists so that we can have a better idea.
[English]
Senator Marshall: I want to pick up on a couple of points Senator Wells mentioned. I wasn't aware that we were having systems audits done. Can I get copies?
The Chair: Senator Wells, maybe you can elaborate.
Senator Wells: You will recall the Auditor General was here for about a year and a half, and he not only looked at our expenses but the systems set up within the Finance directorate. I meet with Pascale almost daily on many of the systems that are set up.
The recommendations that the Auditor General made weren't just on our expenses but were on the tracking systems that we have in Finance. Those are the systems I'm talking about.
Senator Marshall: And they're being audited?
Senator Wells: They were changed as a result of the audit.
Senator Marshall: I understood we were having systems audits carried out.
The Chair: I think Senator Wells is referring to the platforms put in place internally in our administration and externally that — and I agree with him — are in many ways no less rigorous than an auditor going through those items. But that's open for debate. We put those systems in place to avoid some of the scandals that blew back at us last time around.
Senator Marshall: The last point I'm picking up on from what Senator Wells said: Where we have been waiting for audits now for several years, if a senator wanted to have an audit of my expenses done, I could have somebody outside come in. Would I pay for that out of my budget or is that something that —
The Chair: That would be out of your own budget, and as a senator —
Senator Marshall: That could be done? Admin would be agreeable to that? Okay, thank you.
The Chair: Maybe Nicole Proulx can give us pertinent information.
Ms. Proulx: It goes back to an earlier question on project management providing a bit more information on that audit. That was an advisory engagement, and it was to respond to the OAG's recommendation at the time, in 2012-13, to the Senate administration to improve its project management, specifically the methodology for IT-enabled projects. They had come and reviewed a number of projects, mainly in IT, and had some recommendations that were all implemented. I do not have all the recommendations with me but they were produced in the annual report.
If I may just pursue Senator Tkachuk's history, the internal audit function was created in 2009. To the question of whether there is an internal auditor right now, there is no staffed internal auditor position. We are waiting to see from the current audit subcommittee some guidance, because one of the recommendations was that it should be reporting differently.
When the OAG came, you all remember that it was quite intensive. The report was produced in 2015. During that period, the audit subcommittee made a conscious decision to support the numerous auditors we had on site. There were no other internal audits, and the multi-year audit plan that had been scheduled was set aside for that time.
There is still now a number of recommendations that need to be adopted and actioned. There was more of a volume issue at this time. The internal audit function was created, so I just want to make it clear that there is one, but it was just in abeyance for that time period.
I don't know if you would like to have more information in terms of the audit of the financial statements and really what it entails, because Pascale could certainly give some information if you are interested in the scope of what they review.
Senator Lankin: Nicole, that was very helpful, thank you. The question is: When does that function get billed, and is it advisable to hold off on that until the external or internal audit group or oversight audit group — whatever that group will turn out to be — is defined in terms of reporting relationships and other sorts of things?
I appreciate that history. I'm glad there is that position. I think it's important to have that function. And it's not about senators' office expenses — it includes that — but it is about the functioning. Thank you.
Senator Omidvar: I want to second Senator Dupuis' request and suggestion that we have some kind of an understanding of the scope and depth of various audit functions — who they touch, what they touch, what their reporting timelines are — so we get a sense of what appears to me is a bit of a web. Are there gaps or is there duplication?
The Chair: Maybe I can suggest some direction to the clerk. As you can appreciate, it will be impossible to put in a binder all the changes, rules and adjustments, administratively, that have happened over the last three or four years. I might suggest that we can send out a list of all the subcommittee chairs, deputy chairs and steering committee members, and senators can take the time in areas of the administration that they're interested in to reach out to those chairs and meet with them individually.
To give you a context of all the historical background would take months upon months. The best way to do it is for each individual senator to reach out to the subcommittees and engage with them. We have tons of subcommittees on audit, communication and budgeting. I'm trying to answer your question, but I don't know how to effectively answer your question other than that.
Senator Omidvar: I don't think that's what I was asking for, and I'm not going to speak for Senator Dupuis. For me, a simple functional chart would suffice.
The Chair: An organigram of sorts?
Senator Omidvar: Yes, a map of the auditing functions, not the organizational map of the Senate. I have a map of the Senate.
The Chair: That we can provide you.
Senator Omidvar: It's a simple thing.
The Chair: That we can provide you easily.
Senator Tkachuk: Going back to this outside/inside auditor, when we had an inside auditor, there was tension between the auditor and finance. That was not a good thing, I don't think. My view is that with a small organization — I know it's a $90-million organization, but in the world of organizations it's not that big — I'm going to go back to recommending highly that we, every five years, do an audit from an outside auditor. There should be a full-time audit committee that would oversee that and also receive the regular audits that you do on a yearly basis. In that audit you do on a yearly basis, you can examine five senators or whatever; you can draw them by lottery. Then every five years, do an audit of expenses.
If you don't do that, as happened before, bad habits seep in. You won't even realize it. I have been involved in private organizations and public companies. You can't escape not having an outside auditor have a look every once in a while and open that window. I guarantee you, it may not happen next year, but 10 years from now, you'll be facing exactly what we faced last time. It's just going to happen. I can't stress it strongly enough.
With an inside auditor, there will be tension between finance and the inside auditor. There was last time and there will be again.
Senator Lankin: I understand the point you're making, Senator Tkachuk, and I think there has been a history of that in a lot of organizations. But there is a huge evolution that has and is taking place where the internal auditor is an entirely value-added role, and that administration sees value in that and takes advice. It really depends on the skill set of the person you hire and their understanding of the internal audit role. We could do a bad job of it and end up back where you're saying, so that's a caution well put.
Senator Cordy: This is an excellent discussion.
None of us wants to go through an audit that costs at least $23.4 million. But going back to Senator Tkachuk's point, in the past, it was random selection; five or 15 had a hospitality audit. I think it was five, but it might have been higher. Five had travel audited and five had office expenses audited. In that way, there was a sense of what kinds of things we have to look a little more closely at. That was important — what was started a few years ago.
The Chair: Colleagues, before we end on this issue — and I want to thank Senator Smith for his brief — I want to read to you the Auditor General's report recommendation 51:
The Senate of Canada should review the mandate and structure of the Standing Senate Committee on Internal Economy, Budgets and Administration, as well as the reporting relationship of the internal auditor, with the objective of creating independent oversight of Senators' expenses.
Colleagues, that's where we are. Also, over the last four or five years, there is no Parliament in Canada that has been audited as severely and intensely as we have. Now, we've taken the recommendation of the Auditor General. Above and beyond that, I think we are compelled to become more transparent and be cutting edge compared to any other Parliament. The subcommittee under the leadership of Senator Smith is doing that.
In the next couple of weeks, the body of work you've done will come to each of our caucuses, we will have that thorough discussion, leadership will bring the input back to Senator Smith and his group, and the culmination of all that work will come back to this committee for approval. Hopefully, that will bring it to a close.
So, thank you, colleagues, and thank you, Senator Smith.
We're going in camera for the next subject matter, which is a briefing on communications. I recommend we do that because we'll be talking about operational matters in communications, as well as strategic matters. We should do that in camera, with your approval. Is everyone comfortable with that?
Hon. Senators: Agreed.
(The committee continued in camera.)