Proceedings of the Standing Senate Committee on
National Finance
Issue 29 - Evidence - October 25, 2005
OTTAWA, Tuesday, October 25, 2005
The Standing Senate Committee on National Finance met this day at 9:38 a.m. to examine the Main Estimates laid before Parliament for the fiscal year ending March 31, 2006.
Senator Donald H. Oliver (Chairman) in the chair.
[English]
The Chairman: Honourable senators, I call to order this forty-third meeting of the Standing Senate Committee on National Finance. The committee's field of interest is government spending, either directly through the Main Estimates or indirectly through bills.
[Translation]
On Monday March 7 2005, our committee was authorized to study and report on the projected expenses in the Main Estimates for the fiscal year ending March 31, 2006. Since March 9 2005, this will be our eleventh meeting to study the Main Estimates.
[English]
The committee has been examining government spending in the context of greater accountability and transparency. At the core of Canada's parliamentary system is the constitutional convention and practice of ministerial accountability. Ministers of the Crown are responsible and accountable to Parliament collectively as part of cabinet and individually as ministers in charge of departments. This convention arises out of the democratic principle that only elected officials, and not the public servants who assist them, should be held accountable for the functioning of the government. To help us to discuss this and other issues we are pleased to welcome Professor Jonathan Malloy and Professor Sharon Sutherland. Mr. Malloy is Associate Professor of Political Science and Associate Chair of the Department of Political Science at Carleton University in Ottawa. He holds a B.A. from the University of Waterloo, an M.A. from Queen's University and a Ph.D. from the University of Toronto. He joined Carleton University in 2005 and is broadly interested in all aspects of Canadian politics, but he specializes in public administration and legislatures. He has a particular interest in the relationship between state institutions and social movements.
Recently, Ms. Sharon L. Sutherland was appointed Visiting Professor of the University of Ottawa's School of Political Studies. She received her B.A. and M.A. from the University of Alberta at Edmonton and earned her Ph.D. at the University of Essex in England. She has served on faculty in departments teaching government and political science at the universities of Essex, Dalhousie, Carleton and Queen's. She is a fellow of the Royal Society of Canada. During the past 25 years, Ms. Sutherland has taught a range of courses, mostly at the graduate level, on comparative executives, Canadian government, democratic theory and accountability, philosophy of social science, research methods, ethics of public office holding, organizational behaviour and theory, strategic planning, and policy and program evaluation. As well, she has completed several long-term assignments in the federal government and various consultancy projects.
I would like to introduce the members of our committee: Senator Joseph Day, Deputy Chair of the Finance Committee, from New Brunswick; Senator Michel Biron, from Quebec; Senator Marisa Ferretti Barth, from Quebec; Senator Mac Harb, from Ontario; Senator Grant Mitchell, from Alberta; Senator Pierrette Ringuette, from New Brunswick; Senator Hugh Segal, from Ontario; and Senator Terry Stratton, from Manitoba.
Sharon L. Sutherland, Professor, School of Political Studies, University of Ottawa, as an individual: Mr. Chairman, honourable senators, thank you for inviting me here today. I understand that my longer and now-revised remarks have been distributed. I made the revisions because of Mr. Alcock's announcements.
I am here to discuss whether it would be helpful to graft the accounting officer role as it operates in Britain into the operating space between the elected executive and the appointed executive in Canada. The gist of what I have to say can be summarized in a few words: everything depends on circumstances. I personally doubt that we in Canada have the political maturity or the practical reason to operate that particular reform.
I have three main reasons for this. First, there is still some element of public interest journalism in Britain providing background that allows citizens to understand the processes of government as just a huge number of transactions, and that a certain number of them will go wrong. I do not see that in Canada, where the media is much more uniform and more profit oriented generally. Our media tend to scandalize.
Second, in federal Canada we have had a real lack of financial and compliance audit, made acute by two factors: First, the program review in 1995-96 disproportionately cut internal auditors. At the same time, the Office of the Auditor General has been moving since 1997 into something very close to what internal audit is understood to be. It has moved into its own version of operational auditing, also known as management auditing, comprehensive auditing, value-for-money auditing, and that is the same thing as internal auditing. As the AG left the field of external or strictly financial audit, internal audit as the first line of defence was badly cut. Thus we have had, and we will have until the Treasury Board President's reforms in internal audit capacity have been implemented and are on stream, too little probity audit to detect even simple frauds. Most of what has upset the Canadian public is very simple.
If you combine a lack of close attention to probity with a sensationalist and profit-oriented media that will fill its pages cheaply, you have a perfect combination — you have a scandal machine.
My third reason for being nervous of the British reform is, given our comparative lack of financial or probity audit and our aggressive media, if the reform were to work badly in our political culture, I do not think we could ever pull it back. That is almost the definition of what it is to be able to govern, to be able to fix the things you do wrong, to be able to fix reforms. I do not think that could be retired; I do not think that reform could be removed once it was in place. We might be on some kind of merry ride.
You will not need reminding that the last two federal elections were dominated by fierce allegations of scandal; misleading in the 2000 election, heartbreakingly foreboding in the 2004 election. It is also likely the next election will be lacking in public discussions of deeply urgent policy issues because of the scandal mentality.
Here we have two scandals in which no lives were lost. The amount in the so-called billion-dollar boondoggle that ruined the 2000 election was $87,000. The problem is that is a lot to the ordinary person — it would make a big difference in my life — but not much materially in the accounts. Gilles Paquet and Ruth Hubbard wrote an article entitled "The Quail Enigma" in which they said the amount of money we are talking about in Public Works and Government Services is seven-tenths of one per cent of the annual budget. In a real sense, mal-administration is a lack of basic safeguards; it is now preventing Canadian democracy from operating, and has done so since 2000, since the first scandal broke.
The alternatives, as I see them, are that the accounting officer reform would add to this phenomenon that we see in Canadian politics and would simple create another newsworthy source of conflict. Or, to be optimistic for a moment, the single reform might have the effect of decreasing actual political scandal to such an extent that the nation could talk politics instead of punishment. Given the circumstances, we have to wonder whether this is likely.
What are our circumstances? In principle, Westminster government is legitimately and by intention a tiny mechanism for concentrating political space, political power. With acceptance of responsibility by the government comes the jurisdiction to act to ameliorate public problems and put state-created misery at an end. It is a machine that looks forward. It is not a machine that is supposed to look backwards.
Let us look at some of the contextual factors that suggest that the accounting officer reform is differently situated in Britain, but remember that these various provisions do not prevent all, or probably very many, dubious contracts or gifts to individuals from political parties that are later compensated. A gentleman was elevated to the House of Lords for two gifts that added up to 100,000 pounds, which is a lot of money. I have the detail if you want it later.
What I consider better in Britain would be the following kind of thing that Mr. Malloy will probably want to talk about generally: Chairmanships of committees are generally allocated according to party strength in the House of Commons. There are many opposition chairs of committees, primarily the financial committees. In the federal House only the Chair of Public Accounts is an opposition member. The British House has a Civil Service Committee. The Operations Committee of the last Parliament looked like it might do that, but it has not persevered. In 2003 the British House of Commons established a liaison committee of committee chairs that questions the Prime Minister himself on his general management of government, including asking for an account of the activity of the people who are appointed as their equivalent-to-exempt staff.
The Chairman: Was that a private meeting?
Ms. Sutherland: I think it is a private meeting, but it has minutes and it is followed up on.
The British government under Prime Minister John Major established in 1994 a committee that still continues. It is the Committee on Standards in Public Life. This is an independent body funded by the cabinet office, loosely attached to that office. Peter Riddell, chief political commentator of The Times, prepared a tenth anniversary "report" on its utility. The committee has become the ethical conscience which Whitehall would rather not have. We have no such innovation. There are all kinds of other things, such as the non-partisan style of the Public Accounts Committee and the huge amount of audit and integrity work and other forms of regulation in Britain that are not done here. They were put in place by Mr. Blair's government, partly as a check on or a way of controlling the fragmentation to which he subjected the public sector.
Now, a little on the Office of the Auditor General: David Cooper and Ken Ogata, two business professors from the University of Alberta, claim that the Canadian Auditor General has functioned as a pseudo-opposition. It first pushed the new public management techniques like empowerment and risk taking, and then reported dramatically on failures. They say that despite a lot of work on the forms of audit that are results oriented and new public management oriented, the most influential and damaging Auditor General reports have dealt with administrative breaches involving basic issues of stewardship and accountability rather than the weakness of results-based management, which is the most costly and prized element of the OAG work.
The OAG is still reporting on the same kinds of incidents that it was reporting on in Petrofina and the refitted naval vessel Bonaventure. It is the same issues that get the public attention. Also, the OAG is damagingly late on the probity side. It would arrive at Public Works and Government Services only in 2002 and by invitation.
My last point on audit is if you look at the National Audit Office, you find that of the proportion of total budget expenditure on traditional audit versus its own version of value-for-money audit, which is nothing like ours, the NAO spends more than twice on traditional audit than our auditor does. This is important.
In addition, most of the NAO's value-for-money audit comes out of qualified accounts. They are basically on the money or on the accounts most of the time. The National Audit Office spent something like 50 per cent of its budget on financial audit in 2003-05 and our AG spent 25 per cent.
There is a Public Accounts Commission constituted on bipartisan lines that takes responsibility for political direction of the National Audit Office. There is no political body or individual that could claim to guide our "supreme audit institution," as the organization is called.
Another factor is that the British have about 14 mega-departments of state, so they have 14 permanent secretaries at the apex of those organizations. If I understand it correctly, there can be many accounting officers for a big department. The number of accounting officers may or may not include the permanent secretary. It probably does not. Whereas the reform, as we wish to implement it, would make every single deputy minister the accounting officer for the entire sum of money in his management.
Just to return to the media again, we are all familiar with the wall-to-wall coverage that we saw of sponsorship, later on of the inquiry into it, and of the Human Resources Development scandal. The first time we met this phenomenon of blanket media coverage was with Meech Lake. It was probably the first experience in Canada of a concentrated and irresistible media storm.
David Taras has a scholarly analysis of the key events of the time. He says that television created an arena that was shared by journalists and politicians, and that arena changed the Constitution-making process. It altered what happened. I am suggesting that we have in Canada a similar process for creating Canadian scandals and keeping them going as in the Meech Lake tragedy.
The other point that I would like briefly to address is the hunger for blame. It is futile in a Westminster system to look for exact individuals to blame. It is generally hopeless unless you have a criminal case or a clear fraud.
Since impeachment appears to have been abandoned, Westminster government has been basically useless for assigning blame to exact persons in a just way. In fact, the confidence convention arose in response to repetitive and often unjust attempts to impeach individual ministers. The confidence convention rations the imposition of individual resignations on the government as circumstances allow. In a minority government, you cannot ration individual ministerial resignations if an opposition is determined.
Political ministerial responsibility, if it is after punishment, is a form of very rough justice, and it too depends on circumstances. Punishment is political; it is not juridical.
Charles Polidano defines ministerial responsibility in a remarkable phrase. He says it is a model that:
...shrouds wide, reconciling a million discrete actions taken under many authorities in the names of ministers. The whole is made democratic and acceptable to the electorate under the answerability of ministers to Parliament for the action they take to put departmental errors right.
In other words, responsible politicians ask what can reasonably be done. Barring criminal activity, the system ought not to go deeply into establishing guilt. There is a separate system for mal-administration by public servants.
Equally problematic is the problem of many hands that Richard Mulgan, an Australian scholar, describes. "Many hands" arises from collective government at the political level, from collaboration among officials and from cooperation among officials and the political level. The public and the media and all Westminster systems call for ministerial resignations even for the most general kinds of institutional failure.
Mulgan returns us to the principle that blame and punishment should follow personal responsibility for an action or inaction. In most cases of institutional failure, he says:
the fault is...widely dispersed and usually includes systemic failure in the institution's structures and procedures which are the responsibility of many different people...In such a situation, the aim of punishing all those who are involved appears impractical and unreasonable and often results in everyone escaping comparatively unscathed, thus frustrating accountability.
Westminster government is not good at punishing people. In return, we get a government that is oriented and able to correct errors that cause distress. It can concentrate the power to do this.
For all these reasons, I would not feel safe in pushing any particular reform of the system to absolutely prevent another event like sponsorship. I do not want to be the father of the Constitution.
Even though the sponsorship episode was offensive to Quebec in particular, and terribly offensive to the rest of Canada, it is impossible to offer Canadians purity. Totally clean government would have to be totally clean dictatorship, and you do not often find those two things together.
I would rather suggest a modern mechanism outside the footprint of the machinery of responsible government that I think is small and simple, not big and complex or nuanced. I would choose a continuing committee on standards in public life, loosely modelled on the British committee at its best, without too many passengers. This would be a committee with a mandate to think, a committee that would become a thorn in the side of government, a prod, an encouragement to do the right thing, and a reminder that there is always a tomorrow. The Senate could be a significant recruitment pool for members. If the government does not establish such a committee, I would suggest the honourable senators do the right thing and establish their own.
The Chairman: Thank you very much for that excellent overview. Before turning to Mr. Malloy, on page 7 of your report, could you quickly summarize what I think are two important paragraphs that I know you had to rush through and did not have a chance to talk about. That is, the value of deputy ministers formally being accountable to discuss in their own right the authorities conferred under the Public Service Employment Act, and so on. Those two paragraphs are important. I would love to have your own words and views, if you could, please.
Ms. Sutherland: There have been two other alterations to what we could call intra-executive relations. That is, relations between the highest appointed public servants and ministers. These two changes are that deputy ministers would be accountable in their own right, as though they owned these particular provisions, to talk about all the authorities conferred on them by the Public Service Employment Act, the Public Service Modernization Act, the Financial Administration Act, and any other act that names them by the title of their job. In my view, the fact that a deputy minister is named in a statute does not mean that he or she has the whole basketball pitch covered and that no one else has any input into how that responsibility has been acquitted. It is not a private law naming an individual, like the divorce laws that we used to have. It is a public law that states that the deputy minister will execute these duties for the minister. That is my reading of it.
The Chairman: Execute and account?
Ms. Sutherland: Execute and account to the minister. I think both the deputy minister and the minister are subject to these laws. The laws and the rules are meant to be obeyed, or, if you grant an exception, you reason it through and give grounds that can be defended publicly. The DM can remain responsible to the minister for how uniformly and fairly he or she applies the law. Law is not just like a cookie cutter; sometimes it is appropriate and sometimes it is not. You have to be careful about when you invoke the law and not just bang it down on people, or when you withhold it. You do not have discretion yourself. You have to reason it through juristically or get advice.
Removing the power of appointment of deputy ministers from the Prime Minister, making them merit appointees and thus changing their tenure to good behaviour, is a little dangerous, because we tend to shuffle ministers around like a fast game of checkers. Deputy ministers would then be installed under good behaviour, and most of them do behave well. They would not be grateful to the Prime Minister and their movements and the changes would not be in the hands of the Prime Minister and the Clerk of the Privy Council. I know we are stagnant now as a polity, but we do have times of great turbulence in elections. In a normal time in Canadian electoral turnover, I think that the deputy minister would become the only stable element. The near-documentary that was referred to, the British program, Yes, Minister could be become "Yes, Mr. Deputy Minister," or else the minister could become the Maytag repairman, because I do not know if we will change our habits.
In a democracy, governments must be allowed to acquire experience. They must be allowed to characterize themselves by what they do in office. If they were not allowed to show us their warts and what they are capable of, negatively, how could we ever decide when to change them? They must be allowed to make their own mistakes. In other words, we cannot be completely protected from the people we elect. I think that is what that urge is. I believe it would make much more sense to put effort into codification of the rules and freedoms that surround exempt staff and make ministers answer, in some version of a liaison committee, for the behaviour of their exempt staff.
The Chairman: Thank you very much. Mr. Malloy, would you make your presentation? I will then open it to the senators.
Jonathan Malloy, Professor, Department of Political Science, Carleton University, as an individual: Professor Sutherland has spoken broadly about a number of areas, particularly the executive. My own expertise is limited to the legislative side of things, and that is what I will be talking about today.
My research on government accountability focuses on Parliament's ability to hold government to account. I argue that no matter how much we reform the ways in which the public service reports to Parliament, there is limited interest and capacity in Parliament itself, particularly the House of Commons and its committees, to provide scrutiny and accountability. I am therefore in the somewhat odd position of talking to this committee largely about the other chamber and its committees. The House of Commons committee system does not have the capacity to properly scrutinize government activities and call the appropriate people to account. While procedural changes over the years, along with modest research assistance, have helped committees do more with limited resources, members often appear uninterested and not engaged in public service accountability work for two main reasons. The first is the high turnover in standing committees. Membership is rotated so frequently that few members sit on the same standing committee for an entire Parliament. I have figures that refer to that. In any given session in recent years, often, half or more members are new to the committee. This undermines committee focus, corporate memory and trust and cooperation between members. Additionally, members of the smaller opposition parties — and sometimes larger ones as well — often sit on two standing committees or more, leaving them unable to devote themselves fully to their committee responsibilities.
The net result is committees spend a great deal of time reinventing and educating themselves, rather than providing sustained and ongoing scrutiny over time. The second reason is the general lack of interest in accountability matters among House of Commons members. I want to stress that I am not criticizing MPs' dedication or abilities, but pointing out that pursuing scrutiny issues yields little direct benefit in terms of political visibility and prospects. Neither party leaders nor voters reward members for burrowing into the public accounts unless something sensational is found. My interviews with MPs have always found, with few exceptions, little interest in the Estimates, public accounts or other financial and administrative matters. Instead, they prefer policy work and policy committees. Furthermore, since members do not usually determine their own committee placements anyway, those MPs interested in such matters may not end up on the most relevant committees either. The net result of these weaknesses is a House of Commons committee system that is not properly equipped to digest the many reports sent to it, much less investigate further public administration matters in a deep and sustained manner.
The temptation to focus on superficial matters and to search for blame rather than full explanations is overwhelming. In particular, Commons committees often seem unable to properly establish the ground rules for questioning public servants and distinguishing their accountability to the committee versus that of ministers.
The Senate committee system makes up for many of these deficiencies, generally providing greater continuity and depth than Commons committees. It is ironic that the lower House, traditionally the key chamber for fiscal accountability, is less engaged and effective than the other chamber. However, it is difficult to transfer the strengths of the Senate system, with the different roles and status of its members, to the Commons system.
Establishing the accounting officer concept may provide greater clarity and guidelines for Commons committees in the search for accountability, but the reform and adjustment of public service procedures and responsibilities is incomplete without greater capacity and engagement on the parliamentary side of the equation.
There are no easy solutions. Party whips could reduce the level of turnover in committees, but the larger issue of MPs' engagement and interest in accountability remains. Greater staffing and other resources for accountability-centred committees such as Public Accounts and Government Operations and Estimates might enhance their standing and value among members. More support from party leaders for scrutiny as opposed to blame games is also necessary. Ultimately, to make the system work, members of the House of Commons must be able to find accountability worth their while.
I have also brought several tables here; they do not look particularly snappy. I have data to illustrate particularly my comments about turnover in the House of Commons and its committees. I believe they have been provided to senators here.
The first is table 1, showing turnover in the House of Commons since 1957. This is a simple table showing the number of new MPs elected for the last 45 years of elections. The key column is on the right-hand side: the percentage of new members. One sees that the average turnover in the House of Commons after re-election is in the ballpark of 20, 30 and 40 per cent. In the most recent election, 2004, 33 per cent of the House of Commons was new, as opposed to, for example, 18.6 in 2000. When one third of the membership changes on a regular basis, which is about the average, it is difficult to have long-term continuity. Fresh blood is always good, but it really undermines continuity.
This is shown in table 2, with recent turnover in House of Commons standing committees. This is a selection of 11 of the standing committees of the House of Commons. The table is perhaps not that easy to read, but the key figure is simply the number of new members in each session. The first column is for the current session; you see that a large number of new members came in after the 2004 election. In the second column is the number of new members; and in the Thirty-seventh Parliament, third session, which was after Mr. Martin became Prime Minister, you see again a still larger number of new members on committees of about 11 to 16 members.
The third and fourth columns show the number of MPs serving continuously in the Thirty-seventh Parliament — in short, how many members served on the committee for one parliament — and it is relatively modest: six, eight members and so on. I draw your attention to the Public Accounts Committee, at the bottom. Only six MPs served continuously on the committee for four years. The committee had 16 members for most of that time.
Looking back further, to 1997, in the fourth column, you see the continuity there is even less. For many committees, no members served on the committee for two entire parliaments. There were only a few — Canadian Heritage stands out, as well as Agriculture — where there was a clear core of members who served on the same committee for a long time. The vast majority of members come and go for one or two sessions.
Table 3 looks more directly at the Public Accounts Committee, which I mentioned earlier. This is a list of the current membership of the committee, at least as of yesterday. You can see the range of experience of the members. They are listed here according to when they were first elected. You see that three of the members, Mr. Sauvageau, Mr. Lastewka and Mr. Williams, the chair, have all been in the House of Commons for a long time. Mr. Williams has been on the committee for that entire time.
If you look further down, the level of experience rapidly drops off. There are two members elected in 2000. No less than seven of the current members of the Standing Committee on Public Accounts were first elected last year. They are new not just to the committee, but to the Parliament of Canada as a whole. I would note that two of them have experience in the Ontario Legislative Assembly. In short, the main House of Commons committee for investigating the public accounts of Canada has a large number of rookie MPs. That is not entirely bad, perhaps, but it does not help the committee in its work.
One final table here is the longevity of membership in the same committee, Public Accounts. Because there was a large turnover in 2004, that of course means there is a relatively high number of new members. You may recall in 2000 we had a fairly low level of turnover, about 18 or 19 per cent of members. This final table looks at the House of Commons Standing Committee on Public Accounts in the Thirty-seventh Parliament, third session, in 2004. This was the committee that examined the sponsorship scandal in the spring of 2004. The final column indicates just how experienced the members were on the committee; that is, how many previous sessions they had served on the Public Accounts Committee. You see at the top there are three quite experienced members, Mr. Williams, Ms. Phinney and Mr. Mayfield, who served on the committee for the entire period of seven years. Mr. Forseth also spent much time there. Again, then it starts dropping. You have members who went on in 2002 and 2000. Again, right at the bottom, there is a large number of rookie members. That, of course, indicates not just turnover in the House of Commons, but turnover in the committee itself. This underlines the idea that standing committees are largely revolving doors. There are few veteran members. A large number of members do come and go. Often, they are there not by choice; they are there by assignment from their party whip.
These data indicate just how difficult it is for the legislature to digest what is coming to it — the reports, and particularly knowledge of the different departments, personalities and so on. There is so little experience in the House of Commons committees that they cannot hold a government fully to account because of their limited resources, their high turnover and lack of interest.
I will stop there, Mr. Chairman, and be ready for questions.
The Chairman: Thank you very much for that report and your tables. My only regret is that you did not have an opportunity to do similar tables for the Senate. If you had, I think that some of the recommendations of Sharon Sutherland about the role the Senate can play in relation to accounts and accountability would have been confirmed. Maybe one day you will have a researcher assist you in doing that. It would be an interesting study to see, particularly in comparison with the House of Commons.
Mr. Malloy: Thank you.
Senator Stratton: Thank you for attending today. It was interesting. Some of the members, myself included, have been on this committee for quite some time.
You realize governments will make errors. You realize ministers will do things incorrectly. Eighty-seven thousand dollars is not much money in terms of the overall budget of the government. However, when that is repeated over and over, that is when Canadians simply say we must do something. That is where we are at.
I will give an example that I gave here earlier to another set of witnesses. This is not to impugn any particular government, but rather to get to the issue of what seems to happen. On the gun control controversy, we had the minister sitting in front of us at the beginning saying that this will not cost the Canadian taxpayer any money. Then year after year — and I was sitting on this committee — they would consistently come for more money. We would raise our concerns year after year, and we were told not to worry about it; this is the end; it will not happen again. Yet it kept climbing. Then, of course, ministers are changed and the accountability goes out the window. That is the basis of our concern. We raised the spectre year after year, and nothing happened.
We were effective in pointing out the problem, but the minister chose to ignore our advice. We were caught in the conundrum that the public expects and demands something to happen because of the repetition of these events, and yet you have a minister defying your questions and saying it will not happen again, year after year. On the gun control issue, it happened again and again. That is where we are at, in my view.
How can we capture and control that to the degree possible? Are we talking about a general lack of morality in the politicians of the country, or are we talking about governance here?
It is probably a little too early to ask whether Minister Alcock's announcement will be effective. That is ultimately the question. I know you have not had much chance to look at it, and neither have we. If you cannot answer that today, I would very much appreciate your analysis of what he is proposing and perhaps you could submit something to this committee on whether, in your opinion, it will work. That is absolutely critical for this committee to hear. I know that is a lot to ask. I believe you know where I am coming from.
Ms. Sutherland: I do not think it is a lack of morality. It is a lack of courage in a particular political circumstance where the government is now a minority. Since 2000, it has been in danger of its life. We had what was, in my view, a lack of dignity in the split between Mr. Martin and Mr. Chrétien. That battle was fought, and it weakened the government. It was on the agenda. I would say the lack of attention to the architecture of the gun control problem was a combination of bad political party management and bad governance.
That particular program is a hot potato because a lot of morality surrounds it. We find it difficult to discuss issues that touch people's sensitivities. You have the rural/urban dimension and all kinds of other dimensions. You have pride in what was done so far — maybe misplaced pride — and probably the sincere feeling of the people who are managing it that it will be the last big sum.
It is interesting that no one has taken on that program for a major analysis. I have often thought about it myself, but I am one lone researcher. I do not have research assistants. I am the last of the lone-wolf academics, before we moved into packs of academics that had to apply for grants, which I call "daycare academics."
Senator Segal: Brave woman.
Ms. Sutherland: I do not have the resources to investigate that. I would love to be at the head of a group of people looking into it, not because you would find a lot of mess or wrongdoing that you could pin on individuals, but because you could do some good. You could set things to run a little better.
What was your last question?
Senator Stratton: It was the question of Minister Alcock and his announcements. I would like you to take a quick run at it, but if you do not have the time to state your opinion fully today, perhaps you could follow it up later by sending something to us.
Ms. Sutherland: I can take a quick run at two items. He is on the money in strengthening internal audit with qualified auditors. That has been sadly lacking. We all know that it was internal audit at Public Works and Government Services Canada that signalled something was wrong, but they were not paid attention to, in part because it was such a small ragbag, harried little institution that no one thought anything big or sensible would come out of it. It turned out that the internal audit director had been right, but was ignored for all that. It helps to have a diploma on the wall. I believe that 300 fully qualified auditors is a considerable number.
When Harry Rogers came in in 1977 or 1978, it was a new concept in Canadian government to have a strong internal audit. Within a year, we had gone from zero internal auditors to something like 800. That was then, and then a program review cut internal audit back and people tended not to be qualified, certified accountants. They tended to be social science graduates and useless people like me who have a ragbag of tricks.
Mr. Alcock is doing some necessary reconstitution of what ought to have been there the entire time, but I would not take anything away from him because he was not there when it was dismantled.
The audit committee for each department is the other issue that my eye lit on. I did some research for a department on the best form and most honourable structure for a board of directors setup, including how the audit committee ought to work.
Given the idea of having outside directors, it is clear that Mr. Alcock wants to bring a fresh eye. As Professor Malloy has made quite clear, sometimes a fresh eye is so fresh it does not see anything to light on. Also, I wonder where those people would come from and whether disclosure provisions are in place as to whether they or their spouses are connected to particular firms or what their spouses' interests are and so on.
If you look at the best practices for boards in Britain, they disclose absolutely everything to do with the directors, including how many other boards they sit on and their compensation. We do not have any of that detail.
The other departments are fine. Having the external auditors on the audit committee for other departments is not controversial.
There is one provision that I do not particularly like or understand, again in the light of what Professor Malloy has said about our electoral turnover. There are often new ministers. There is a proposal that once a year, the deputy minister will be sent out of the room and private sector directors and people from other places in the public service will have a frank discussion with the minister about what exactly is not clear — for example, how well internal audit has worked and how well the department has functioned. I find that difficult for two reasons. First, the minister might not be in a position to understand what he or she is being told about the difference between the value-for-money audit, comprehensive audit, internal audit, financial audit or compliance audit. The minister might not be able to stay awake for that. Second, it looks to me like a bit of an insult to the deputy minister, who would normally be thought of as a partner in the accountability. In fact, we have had the proposal to make the deputy minister "it," to make the deputy minister accountable in his or her own right for all these other provisions. I find that issue to be a mishmash and not sufficiently justified. For the rest of it, I have read it once, and I will not comment now.
I got a call from a journalist who asked me if it was the biggest change in the Western world. I said I could not answer that right then. Then I asked my husband, "Is this the biggest change in the Western world?" He said, "Well, I don't know, but it might be the most press releases."
Mr. Malloy: I will speak to one element in reference to the firearms registry. It is an issue that I think illustrates this largely academic idea of separating policy and administration. It is a longstanding concept.
There are two issues: gun control and the firearms registry. We saw huge administrative problems with the firearms registry and the software: high costs, overruns, delays, et cetera. That is somewhat separate from the idea of registering firearms. Obviously they are closely connected as well. How do you register firearms? That was a controversial policy.
I have always felt that the government was far too defensive and closed-minded about the administrative aspects of the registry and what was going wrong; to admit failure there was to admit failure of the policy. That led to little transparency and a lot of obstinacy.
I am not sure how one could have gotten around that. It was an issue where the administrative aspects were overshadowed by the controversial policy aspects. As a result, $1 billion largely went down the drain as opposed to the $2 million that the government promised it would cost.
Senator Stratton: The message I am getting is that the advice of this committee and on the part of the internal audit was ignored. That is the concern we must have: How do we overcome that?
Senator Ringuette: I will be consistent and discuss the issues of gun control and policy and administration. I think it is a perfect example for talking about accountability.
The gun registry policy was within the Department of Justice, and therefore they decided they would be the administrators of such a program. It was a program that, from my perspective, was totally new to the operation of the Department of Justice. That was the first fault in regards to administration.
The other issue is that it is unrealistic to believe that a minister, and maybe even a deputy minister, could certify that estimates for program implementation are 100 per cent accurate. They are more than estimates; they are guesstimates from an implementation point of view. There was a lot of fault in this, which brings us to the centre of our discussion regarding accountability.
Does the accountability of ministers rely on policy? Does the accountability of deputy ministers and assistant deputy ministers rely on administration?
In the last two decades, we have created a commotion about ministerial accountability. I am sorry, but no one person can verify and be accountable for 10,000 to 50,000 public servants in one department. Add to that the slate of programs and services that each department is asked to administer.
A few decades ago, we as Canadians made an effort to differentiate between church and state. I think now is the proper time, taking into account past experience, to make the accountability distinction between policy and programs, the money aspect of policy.
I do agree with you, Mr. Malloy, having been an MLA and MP and now a senator, that time-wise and turnover-wise, there is no way that a Member of Parliament can do the kind of work in Public Accounts that a Senate committee with a longer-term mandate can provide to the Canadian public. That is a given.
However, I think the bottom line with regards to the accountability issue is we have to draw the line and assign distinct duties as between policy and administration.
Mr. Malloy: I certainly agree with what you are saying, although having just introduced the policy/administration dichotomy concept, the problem is that it is intermingled.
To use gun control as an example again, to say we will register all guns is policy. Then the immediate question is: How do we do that? Do people have to pay for the administrative costs? You are instantly getting into issues of administration, costs of management, et cetera.
Senator Ringuette: I would like to comment on what you have just said. The departments will be asked to come up with options. They are the ones that provide the estimates for the different options. That reinforces this dual responsibility.
Mr. Malloy: I certainly agree with that. It is their duty. They appeal to the accounting officer concept. You can draw the line and say, they came up with the ideas and they are responsible for them.
The other thing one might say is that it does not end there; there is always a back and forth. In the case of the firearms registry, there was a great deal of back and forth, from the political to the administrative, in terms of how it would be done. We will add fields to the registration and lower the registration fees, for example.
In my understanding, no one has done a sustained study of this. It is not simply a case of the public servants coming up with the administrative options, presenting them and carrying them out. The politicians and, often, the political staff are always coming back with more ideas. That is why there is an appeal in having that seamless ministerial-administrative responsibility only. Otherwise, you cannot possibly sort it out. There is much appeal to having, at the end, the minister be the sole person responsible. At the same time, there is an equal appeal to being able to identify who came up with the administrative options; who was responsible for carrying out the objective.
I do not dismiss the accounting officer concept as strongly as some people; most of the time it can work. Gun control is one case where that concept would not have worked; it was too complicated. There are many other areas where the separation of policy and administration would work well, but not in all cases, and that is why I am muddying the issue like this.
The Chairman: Professor Sutherland, one area of interest to me is the turnover among ministers and deputy ministers. You have both alluded today to the fact that accountability and responsibility of ministers are currently attached to the office, not to the person. As you know, and as other witnesses have told us, when a minister changes portfolio or leaves cabinet, or a deputy minister leaves, he or she can no longer be held to account for the actions that took place in that department while they were there.
When Professor Ned Franks came before this committee on this subject he told us that current ministers are also not accountable to Parliament for decisions and actions taken by previous ministers. We have something of a void. I would like to hear both of you comment on that void. It is a unique problem in Canada that if there is a major scandal within a department and both the minister and the deputy are moved out, there is no one left to be accountable. What do we do? What is your recommendation?
Ms. Sutherland: I do not agree with the view that current ministers cannot be retrospectively answerable. That is how current ministers show how quick a study they are, how able an analyst and what a good politician they are on the floor of the House of Commons. Their duty is to analyse the situation and explain what can be done about it now. The current minister has the power to do that.
The Chairman: What about what took place previously?
Ms. Sutherland: In regard to what took place previously, it is the duty of the minister to get the answers and to respond. If anyone asks about the chain of events that led to a situation, the minister is just being foolish if he or she says, "Well, I was not there and I cannot really tell you that," because the minister should have the staff busy finding out and developing a history. The minister then becomes responsible for the veracity of that history.
The minister has a duty to answer truthfully to Parliament. "Truthfully" means to not ration the truth too much and to tell people what they need to know. If you feel that you have been stonewalled by a minister, you keep on going, because that is one of the biggest parliamentary sins, to not answer fully and truthfully, including for what the deputy minister does. It is the current minister who is fully answerable, who has full jurisdiction and full responsibility to try to make things right. That is what must be pursued.
As Professor Malloy says, the House of Commons is handicapped in this regard by high turnover and a misunderstanding of roles.
The Chairman: You have used the word "answerable" on three or four occasions rather than "accountable." Could you use the word "accountable" in that response?
Ms. Sutherland: Accountable in the sense of a giving of accounts is really answerability; it is explaining what happened, what was spent and so on. The notion of pinning someone down and finding them at fault really flows from the agent-principle theory that came in about 20 years ago. That is more oriented toward blame and forcing people to do what you want them to do.
I agree with Senator Ringuette, administration is a big part of the package. The only problem with getting your thumb right on the deputy minister is that the deputy minister does not have the power and the jurisdiction to act to change things. That is why we need to work on ministers.
Mr. Malloy: I do not have the turnover figures, but as we know, they do come and go a fair amount. It is wrong to say that no one is answerable. The current minister is answerable for what happened in the past. As we have seen, the discussion branches off into semantics about what is "answerable" as opposed to "accountable" and what "account to" means versus "account for." These discussions are abstract and make it particularly hard for Canadians to grasp what is really going on. No one seems to be getting fired or blamed, in a sense, unless the process moves to a judicial inquiry. It is frustrating for people.
On the other hand, it is the most appropriate system, to have current ministers answer for what has happened previously and so on. It is ultimately unsatisfying and frustrating, but it is the way to ensure that in the end, someone is there to always answer for everything going on. You do not automatically start blaming someone right away in terms of who was responsible for what. The current minister must answer, and that is better than having no one at all to answer for it.
Senator Segal: In terms of the Public Service of Canada, if you look at the HRDC issue or the gun control issue, to be scrupulously fair, in both cases the Government of Canada had a different plan from the one that had to be quickly put in place. With respect to the gun registry — while it is not a policy I particularly like — the presumption was that the amendment to the Criminal Code with respect to gun control would be administered by the provinces. A group of provinces took the decision that they would not administer that part of the Criminal Code, leaving the Government of Canada little option but to proceed through its operating department, the justice department, which does not have a history of registering anything. Most registrations in our country are done through the provinces, for good, solid constitutional and historical reasons.
While we all regret what happened, in defence of those public servants, they were put in a very difficult circumstance, and one not of their making.
It is also fair to say, in regard to HRDC, we had a government and a deputy minister who were saying to the public servants, "This is a tough economic time; we want that money out in the community where it can actually help people, where it can make a difference. If you have to choose between back-office people and folks at the counter helping citizens, get more people out at the counter. That is what we are here to do." The deputy said that, while Treasury Board cut the staff complement on the audit side by some 25 per cent. Then people get upset because the back-office function was not done efficiently. It is somewhat unfair to public servants, although not by any intent.
It is important to understand — and I am sure our witnesses would accept — that we do have one of the finest public services in the world. They sometimes have to manage in difficult political contexts not of their making and do the best that they can.
In that context, Professor Sutherland, I wish to ask about the notion of quarterly reports. Many TSX companies in Canada that sometimes have budgets that are tiny by comparison to programs within our departments have to issue quarterly reports. They must identify money in, money out, changes in their fiscal plan; changes from their estimate; they have to issue a management discussion and analysis of the underlying issues; they have to talk about compliance, about banking ratios, and they have to engage with their auditors around the probity of that discussion. I would be interested in your view of whether that would be an improvement in our system, accepting that Minister Alcock and his colleagues are trying to rationalize many different accounting systems across different departments. They have reduced the number, to their credit, but it is not easy to produce quarterly reports that mean the same thing when the accounting systems are different.
Second, colleagues around the table will remember when the provincial ministers of finance, along with the federal Minister of Finance, changed the audit acts provincially and federally to give value-for-money auditing authority to the Auditor General and the respective provincial counterparts. It always struck me that that was invading the territory of parliamentarians.
When it was done, it coincided with agreements between all parties in the House — so no party can claim it was victimized — to reduce the amount of time available for the discussion of estimates and to deem estimates to have been passed by a certain and explicit date, or at least reported back to the House, where normally there was a majority that would pass it, in return for things like more money for opposition research offices and a longer Question Period. It was part of a multi-party negotiation. However, it reduced the core parliamentary role of controlling expenditures. Does Professor Sutherland have any view as to how we might rebuild some of that?
My third question is on deputy ministers and expertise. When I talk to public servants out in the field across Canada, and across Ontario in particular, they say if you go through the cycle — the DM has just arrived and has reorganized, or has left after three years and the new DM has arrived and is reorganizing — it used to be okay because the ADMs were relatively permanent. However, they are now on the move in rotation. It is the notion, from the point of view of the field officer, that there is actually no one consistently home to whom they report up the chain of command. It is frustrating for them.
I would be interested in your perspective on whether or not we should begin with the premise that a deputy minister is appointed for five, six or seven years, barring some reason to change, rather than it being a two- or three-year Order-in-Council appointment, which get shuffled around, producing no continuity at the top.
My final question for Professor Sutherland has to do with the difference between ministerial accountability as it relates to good-faith mistakes versus malfeasance. I am talking about public servants who try to do the right thing but run into a snafu. There is no malfeasance and no dishonesty; it is just a good-faith mistake. Surely we do not want a public service where we are so frightened of people making mistakes that no one is prepared to try new things. That would be the worst thing we could do to government in this country. Should the difference between good-faith mistakes versus malfeasance in some way articulate the roles of the minister with respect to his or her accountability for the department overall? Do you see any benefit in making a distinction?
I have two questions for Professor Malloy. We do not have a Congressional Budget Office as the Americans do. It serves as a constructive counterpart to help legislators, both on a continuity basis and in terms of the depth of research. Thus, when the government says "X," and is clearly whistling past the graveyard — a guesstimate, as my colleague suggested — there is an independent body that can say, "Just a second. The numbers do not add up." Do you think a parliamentary budget office would be an innovation that, in your construct, would be helpful?
With respect to the various kinds of accountability committees that have been referenced, I am interested in your view as to whether the continuity matter might be addressed if there were a joint committee of the House and the Senate. Members of the House would have a majority because they have fundamental responsibility for the approval of expenditures.
I accept as a premise that when new people are sent to Parliament and incumbents are not returned there is a reason for that. It is part of our democratic system. Thus it is neither good nor bad, it is just what happens. Do you think we could do anything around that continuity process, which you understandably and constructively underline, if some of that "jointness" were possible?
I will make a final comment to Professor Sutherland, who talks about the need to do greater study of things that have gone badly. I could not agree more with that. I think of things like Y2K, where the public service of Canada, in cooperation with the provincial public services, municipalities, the private sector and the military, performed superbly. They solved a difficult technical problem, which probably had a great deal to do with why we survived, in terms of our financial systems, the horrors of 9/11. All that extra work had been done. I would like to see some case-study work done on the things that went well and what we can learn from them as best practices. I think that best practices actually outnumber the mistakes and the bad practices in our public service.
Ms. Sutherland: On the notion of quarterly reports, it would be a good idea to do anything to escape the current report on progress that is a development of what was meant to be a succinct report on results. You now see some departments sending in reports that are well over 200 pages long. They are long narratives. They must take a terrible amount of time to produce. They are glossy and beautifully done. However, they do not in fact address the questions. Thus, the notion of a quarterly report focusing more attention on the concrete and basic issues is an excellent idea to put to people.
After all the spending is done, we have the big report that is called the report on performance. We then have the report on what we will do in the spring with the estimates. Both of these are long, wordy reports. I do not really know why they exist. They used to be more succinct and intelligible.
I am grateful to you for having reminded me of the connection between the value-for-money authority and the all-party agreement to deem estimates reported without ever looking at them. I believe this came from a naive belief in the power of science. Estimates had been troublesome. People beat up on ministers and did not say very much about the actual estimates. Sometimes they were interesting. I loved going along to them.
The problem with estimates is widespread. In Britain, the committees, although they are much more stable, harder working and generally bite harder than our committees, spend about 5 per cent of their time on estimates. The last time I looked at estimates here, it was often zero per cent. Five per cent is better than zero, and I wish that could be addressed.
As to the turnover of deputy ministers, about sixteen or seventeen years ago, Gordon Osbaldeston estimated that deputy ministers were in post for a maximum of two years, and ministers even less. Sometimes they coincided for a matter of six or seven months. When deputy ministers tell you that they have a hard time building up a relationship, they are probably telling the truth. I think that could be addressed by talking reasonably to party officials and the people who make those kinds of decisions.
As to the difference between ministerial accountability in relation to a good-faith mistake or malfeasance and what the minister might say in the House, I think that now it is probably skated over if it is a good-faith mistake. If it looks like malfeasance, then you will be told something in code, such as, "A gentleman is helping the police with their inquiries." I think the benefit of the doubt is given until all the dust has settled and we know what has really happened.
I would like to see what Mr. Alcock says he will do now, which would be a rollup of frauds by Treasury Board Secretariat so that people could try to learn from what went before. I take your point, senator, that more goes right than goes wrong. It would be reassuring to the public to see that little list of small sums — computers gone missing, person disciplined or person demoted. That has existed in Britain for a long time. Also, I would like to see the capacity in departments to present their own reports. I am with you on the good side, but we cannot prove it, and until we can, then the partisanship feeds on it and the morale of the public service declines because members feel unjustly criticized.
Mr. Malloy: The suggestion for the parliamentary budget office and the idea of joint commissions are reasonable. Speaking particularly to the idea of a parliamentary budget office, additional staff and resources to serve parliamentarians would always be a good idea. However, the problem with something like the CBO in the United States is that you would probably have some of the same issues that you currently have with officers of parliament, such as the Auditor General. In that case, it is fair to say that those officers have grown in their own ways. They operate in a manner largely independent from Parliament. The idea at the outset was that those officers would serve parliamentarians more directly. A parliamentary budget office, presumably full of accountants and other professionals able to work in a non-partisan way on these matters would be good in many ways, although some key issues are: What would be the precise functions? To whom would reports be made? Would it grow into yet another auditor general-type of office? Staff resources are good, but there are other nuances that one would have to consider.
Senator Harb: I will approach this from a different angle than Senator Segal's by making a statement and asking for your comments. Under the existing system, it does not matter what you do unless you establish a clear division of power between the executive and the legislative body because we would continue to have problems. Currently, we have ministers in power who are part of the executive and a part of the legislative body — Parliament. Therefore, the political conflict would continue, in a sense, because the minister, who is a member of Parliament, would also be a member of the cabinet. We have the legislative arm and the executive arm. Unless that is changed, we will continue to have this problem.
We call it Question Period for a reason; it is not an answer period. The standing order as we know it does not obligate a member of cabinet to answer the question asked of him, or to even stand up. He can simply shake his head and not bother to answer. That is a fact. Thus, the standard will have to be changed such that a question would require a response. We saw that back in 1988, when I sat in opposition in Parliament. We have continued to see that during the past 15 years, and we will see it for years to come. The standing order does not allow it to take place. That will take us to the committee stage, which is the second mechanism whereby a minister is subject to a scrutiny by a parliamentary group or individual member of Parliament. The vast majority of committees meet between 3:30 p.m. and 5:15 p.m., when a vote usually takes place in the House, so there is limited time. I have sat in opposition and on the government side so I am well aware of how the system works. There is an eight-minute limit for questions and answers on the first round and two minutes on the second round, of which any deputy minister or minister is aware. That is direct accountability, in terms of ministerial accountability, to Parliament and parliamentary committees. Outside Parliament we have the Auditor General and the press. The Auditor General is doing a credible job in her efforts to effect changes in the system. As Ms. Sutherland stated, it is possible to bring something to the point where government can no longer function. I am not sure whether that is a problem or whether the problem is sending it back to Parliament.
The ministers do not have a great deal to say, as you stated in your presentations, because most of it happens at the level of DM, ADM and DG, et cetera. We are talking about political responsibility and accountability. In the absence of a mechanism to recognize those responsibilities and accountabilities, you have to have other rights. I do not believe that the current system truly provides for that. The vast majority of the crises and scandals to which you spoke were administrative in nature. We have seen, in both the former Conservative and current Liberal governments, that ministers take the fall. Most often it is not because of something they have done but because of the perception that they have done something. Would you care to comment on that?
Mr. Malloy: There are numerous things to comment on in your statement. In particular, I would focus on your comments about Question Period and the committee system. It is constraining and Question Period is a somewhat odd institution. I always point out that, indeed, it is not an answer period. Senator, you spoke broadly about the executive and legislative relationship. Of course, the Americans have quite a different system of separated powers, whereby the president does not have to take questions each day. It is always interesting to note that both systems have an equal balance of strengths and weaknesses. In the United States, the president and his cabinet do not worry about spending one hour per day or more in preparation for questions and other short-term items. However, it leads to many deadlocks and problems between the executive and the legislature. Canada has the opposite problem, in that ministers control Parliament in a majority government. As a result, they account to Parliament, but in a superficial way. It is highly unsatisfying and crisis-driven, almost entirely by the media agenda. The system does not work as well as it could. I am not sure how one could improve some of the various elements. I am not certain how much changing standing orders would make a substantive difference in how ministers would respond. The questions and answers were shortened a few years ago. Some would say that has improved Question Period in some ways, while others would say that it has made it even more of a raucous shell-a-thon. It is such a complicated, interwoven system that it is difficult to determine one solution. There is no single solution because it is a joint effort of the executive and legislature. The Americans have a different system, with its own strengths and weaknesses. We have to look to our system and similar systems, such as in Britain and elsewhere, to gain a better idea of how to nuance and tweak things rather than make broad changes.
Ms. Sutherland: I concur with Professor Malloy's comments.
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Senator Ferretti Barth: My suggestions will be different from those of my colleagues. We have drawn many conclusions and made numerous recommendations in the aftermath of the sponsorship scandal. What astonishes me in this regard is that despite all the witnesses questioned in this matter, no one appears to be responsible. Do we know exactly where the responsibility of a minister ends and that of a deputy minister begins?
I have another related question. All of this has not occurred due to a lack of regulations and guidelines. It needs to work like this, the minister says this or that and the deputy minister says this or that and, thus, we can assign responsibility to someone. Now, we are being told that no one is guilty. Everyone's gone off to the country, or the sea, or wherever, but the fact nevertheless remains that the money authorized was due to mismanagement and, one way or another, the taxpayers are still paying.
I wonder if there is any way of eliminating this state of affairs. I come from a social and community-based environment and the people of my community are frustrated. The party will pay for this. Why is that? Because of the negligence that everyone knows about. Now we are in hot water and everyone claims that he or she was not there and knows nothing. Everyone is hiding.
One thing in your report particularly interests me; your study of confederation from its earliest days to the present. It states that there have been 173 Ministerial resignations. Out of all of these resignations was there anyone who admitted it was because of mismanagement? I would also like to know what procedures the government has implemented to limit this kind of mismanagement?
Ms. Sutherland: As to who is responsible, I believe that this must always be the minister in office. He has done his best but he was a little overwhelmed by the issues of past ministers, such as David Dingwall who forgot to put a price —
Senator Ferretti Barth: Do not tell me this, no no no, I know these people very well. They have not forgotten. Speaking as a citizen and a Canadian, I refuse to accept this explanation. They are responsible people who held a position of high responsibility and therefore had a duty to respect everyone who is part of our Canadian society.
Ms. Sutherland: This is certainly true. This is probably why the government inclined toward a judicial inquiry, because it is a question of malfeasance. Perhaps we will also see who Mr. Gomery considers responsible.
All the same, the minister is the one who must be in a position to change things and remove this element that has done so much harm to the reputation of the public service. With respect to Mr. Quail, it is also apparent that we really know nothing about what he has done. I do not want to say that he is the one who is responsible, but it is clear that he has lost his reputation and does not seem happy to appear before commissions like that one.
With respect to ministers and to errors made by them or by their officials, the resignation of a minister or public servant for misjudgment has never occurred in Canada. Nevertheless, there have been problems with misconduct involving money, justice and security. Several ministers have resigned for these reasons. About 15 out of every hundred ministers resign without really wanting to do so.
On the other hand, 12 per cent of ministers have resigned because they could not agree with the other ministers or with the Prime Minister. This is quite low in comparison with Great Britain where the percentage is around 88.
There are also cases involving personal misconduct, circumstances that are somewhat hazy, or government appointments. Someone has quoted me, saying that the percentage of ministers who have resigned from their posts is 50, but this is not true at all. This occurred during the early years of Confederation.
Senator Ferretti Barth: I want to say that I am not happy with the system.
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Senator Mitchell: My analysis of this is that this entire hearings process, the debate which it addresses, really stems from a frustration with holding government generally accountable and, specifically, ministers accountable. One of the ironies in that is much of the debate about solutions to that problem, certainly within the framework of this committee's hearings, involves shifting power from those whom we want to hold accountable — ministers and the government — to deputy ministers, public servants; and, of course, nobody votes for a deputy minister. My general concern is that to solve the problem at hand by shifting power to the public service, to deputy ministers, is to erode democracy under the guise of tempering the excess of politics. I do not think politics is inherently bad.
I also think that one of the implications of this is that somehow, we derive from that these deputy ministers should have more specific powers and that they should come before committees and committees should hold them accountable. In a way, you are reduced to managing a management problem by committee. I cannot think of a worse solution.
What I would like to focus on instead is the issue of ministerial accountability and its long tradition in the Westminster model. You have addressed that; but just for the record, could you each summarize specific ideas that you or others have mentioned that would act to enhance Parliament's ability to hold ministers accountable?
The Chairman: I think Professor Sutherland did that in her paper, particularly on page 3, where she gave four major possibilities.
Senator Mitchell: I would like a summary.
Ms. Sutherland: The one thing that no one ever talks about in connection with the sponsorship scandal is the lack of party foundations to provide public money to political parties so they can develop policy options throughout the year and not just get together for an election and work their hearts out. We tend to regard our form of government as the defective consumer good. We are always critical of it. We do not try to make things right. I think one reform that would make things right would be to put more policy on the table so you could distinguish the parties more clearly and you would not have as much stealing of ideas between one party and another. We would be talking about doing something interesting for the Canadian people here instead of worrying about who ought to be accountable. I would very much like to see the establishment of party foundations.
My second great hope would be for the items that are in Professor Malloy's domain, such as committees for special purposes in the House of Commons, with the most knowledgeable parliamentarians to lead them. And the third thing would be that someone would take me seriously about a committee on standards in public life.
Mr. Malloy: To summarize, I think all administrative changes must get at the underlying culture and expectations, not just of a public service, ministers and MPs, but, ultimately, Canadians. As one senator mentioned, we have turnovers in the House of Commons because Canadians decide they want new MPs; that is obviously their democratic right. These issues rely on the larger culture of accountability; making accountability more valued in a substantive way as opposed to blame. Those changes can be helped by more resources and, I think, particularly by fewer turnovers in Public Accounts Committee. It is a larger cultural change. I have suggested things I hope will lead the way to cultural change, but I cannot guarantee it will happen either.
Senator Mitchell: I have two points. One, I agree with you, Dr. Malloy. I think we underestimate the importance of electoral accountability. Many governments are thrown out. This government paid a price and lost its majority; many ministers were not re-elected. I am encouraged to hear the emphasis, Dr. Sutherland, you put on political parties. I think they play a substantial, legitimate and important role in our parliamentary process, which is one of the most successful forms of government in history. Could you comment on the role of the Treasury Board in holding the public service accountable and the government's management accountability framework, which has been structured under the Treasury Board?
Ms. Sutherland: I think Mr. Alcock's heart is in the right place in trying to get Treasury Board more interested in monitoring and following the progress of departments; that can do nothing but help, because Treasury Board has lost its way. The consolidation of personnel management functions under Treasury Board are probably helpful because you have one minister thinking about them. Treasury Board has been a problematic institution from the beginning because it was carved out of Finance in 1966 and has not yet discovered a technology by which it can follow what the departments are doing. It depends on the departments' goodwill in telling them what is going on.
There have been various initiatives. The planning, programming and budgeting systems are not dead yet and we are still working on that business of finding a magical numerical formula to tell us how well programs are doing. We have given up on the numbers and are now auditing in words how programs are doing. In some respects, the Treasury Board is a little too close to the Office of the Auditor General. The Office of the Auditor General is making policy for management through the Treasury Board. Perhaps Mr. Alcock will address that and assert his independence, or perhaps at some point we ought to fold Treasury Board Secretariat back into the finance department.
Senator Day: First, I would like to clarify a point. I am sure Senator Stratton did not mean to mislead any of us when we were discussing the issue of HRDC. You pointed out it was not $1 billion, and ultimately, it was an outside auditor who determined that $87,000 was a more appropriate figure. Senator Stratton repeated this figure, but was not implying this particular $87,000 was repeated. You were not misled by that, I am sure.
Both of you commented that the Senate could play an important role in this process of accountability. I have the report by the Treasury Board Secretariat with respect to review of responsibilities and accountabilities of ministers and senior officials and meeting the expectations of Canadians. There is a chapter in here, "The Committee Review of Government Spending," and there is no reference to any role whatsoever for the Senate.
We will have the President of the Treasury Board here and will ask him about that. I notice there were probably 30 or 40 consultants, your colleagues, involved in advising the government and helping to draft this report. I am surprised that both of you — and others who have been here — have made the point that there should be a role for senators because we are engaged here for longer periods. Believe it or not, some of us actually find the machinery of government and financial administration an interesting and important topic for parliamentarians, unlike our colleagues in the other place. Why do you suppose your colleagues have not had their points taken up by the government with respect to the role of the committees in overseeing financial administration?
Ms. Sutherland: I do not know. Drafting in government, or drafting in general, is a hazardous activity. Some items get left out and others are emphasized, and if several people working on something and contradictions are introduced, they are glaring to the outside reader with a sharp eye.
I expect that this package has been brought forward in some haste, and I was intending to recommend that this committee carry on with the work you are doing and look at the Gomery report — go into that in great detail. Now I see this package, and the many-hands problem, in a different way. It might be an idea to do a critique of Mr. Alcock's report and to get the people here to give reasons or explain oversights.
Senator Day: Professor Malloy, I wonder if you could comment on the role of the officer of parliament, the Auditor General, in assisting parliamentarians?
It seems to me, as one of you pointed out here, 25 per cent of the Auditor General's budget is still many millions of dollars. The Auditor General's department has grown to 600 or 700 people working away. We have a staff of one and half to help us.
What role do you see the Auditor General playing in relation to accountability? Will the Auditor General's role change with the newly enhanced internal audit that has been announced?
Mr. Malloy: The Auditor General's role may change a little in terms of the internal audit, but I am not sure it will affect parliamentarians in the larger picture. The Auditor General has grown into its own institution. It is the Office of the Auditor General, not just the current incumbent. As a result, it is obviously well known to Canadians.
If Canadians were asked "Who is the watchdog on government?" they would say the Auditor General. The reason for that is because the office continuously presents itself as a technical body. Accountants are looking at the technical financial statements and are uninterested in policy. That has a great deal of appeal, although it is a little disingenuous.
Another reason Canadians recognize the Auditor General as a watchdog on government is they have been good at acting as a non-partisan body. That is where the Auditor General has superseded Parliament; they are not identified with any particular party. They are able to stand above party and above partisan interest. They have a disinterested accountant's perspective on things. That is why the Auditor General has superseded Parliament as the watchdog of accountability.
I am not sure parliamentarians can catch up. They come from political parties and they are not accountants or technical experts, although they can be staffed with them.
The Auditor General's office has grown to fill a role. I do think it has grown too big and stands in the way of Parliament reasserting itself as an instrument of accountability. The Canadian people have put their trust in the Auditor General rather than in Parliament, and I do not see a way back from there.
Senator Day: Professor Sutherland refers to the Auditor General's office as being a pseudo-opposition.
Ms. Sutherland: Two chartered accountants in the School of Business at the University of Alberta stated that.
Senator Day: I think the public would agree with that, quite frankly.
If I can finish my comment, I was planning to make a suggestion. I have read your comments in relation to the Auditor General. The entire role of the Auditor General, whether the department has grown too large, has usurped part of the role of parliamentarians and is no longer acting as an officer of parliamentarians but rather a separate institution; whether environmental audits, for example, should done under the Auditor General as opposed to physical audits, is an area that deserves a separate study.
With that said, I would like to hear your comments in relation to accountability.
Ms. Sutherland: The Office of the Auditor General is not accountable to any political force: not to the Public Accounts Committee, and certainly not to the government. That would not be too bad if it had stuck to the text of the 1977 act.
I have here a chart from a report I completed last year for the Financial Management Institute of Canada. In that chart I indicate that the OAG no longer binds itself to the annual treatment of the accounts of Canada.
Assurance for financial statements now accounts for $5 million of its total budget for departments and agencies. They take very small samples, and they select the departments and agencies on grounds of materiality.
You can see on the Treasury Board website that the Canada Revenue Agency is sick with worry because the sampling is so small that if the AG gets a bad sample and comes up with a few mistakes, they will have their accounts qualified. This means they must audit wall-to-wall inside their own departments.
As of 2003-04, the plan was to have a rotational three-year cycle on the accounts and risk-based financial audits. That figure of $5 million for departments and agencies will be decreased still further.
However, we see that the AG will return to previous years' transactions if political materiality and public interest are high. That is indicated in their report. They say it is a criterion on which they choose their studies.
This is the reason we are in a situation where we have a 10-year-old mess that Ms. Fraser is only now shocked and appalled about. If her predecessor had been shocked and appalled in 1999 or 2000, we would be spending our time talking about health care or something else.
Senator Day: I would love to explore your comparison of the sophistication of the media in Great Britain versus Canada. The role of the media in our democracy would make for another fascinating day, but unfortunately, we have run out of time.
The Chairman: We have come to the end of the meeting.
On behalf of the committee, I would like to say thank you very much to both witnesses. Your presentations were excellent, scholarly, informative, thought-provoking and will assist us a great deal in the study we are in the midst of now and that we will continue to work on for the next month or so.
Thank you for coming and assisting us with some of these difficult but important issues.
The committee adjourned.