THE STANDING COMMITTEE ON INTERNAL ECONOMY, BUDGETS AND ADMINISTRATION
EVIDENCE
OTTAWA, Thursday, March 21, 2019
The Standing Committee on Internal Economy, Budgets and Administration met this day at 8 a.m., in public and in camera, pursuant to rule 12-7(1), for the consideration of financial and administrative matters.
Senator Sabi Marwah (Chair) in the chair.
[English]
The Chair: Good morning. Welcome to the Standing Committee on Internal Economy, Budgets and Administration. My name is Sabi Marwah and I have the privilege of serving as chair of this committee. For the benefit of those on the webcast or on the phone, I will ask senators to introduce themselves.
Senator Munson: Jim Munson, Ontario.
[Translation]
Senator Forest: Éric Forest, from the Gulf region, Quebec.
Senator Dawson: Dennis Dawson, Quebec region, Quebec.
[English]
Senator Dean: Tony Dean from Ontario.
Senator D. Black: Doug Black, Alberta.
Senator Wetston: Howard Wetston from Ontario.
Senator Tannas: Scott Tannas, Alberta.
Senator Plett: Don Plett, Manitoba.
[Translation]
Senator Saint-Germain: Raymonde Saint-Germain from Quebec.
[English]
Senator Marshall: Elizabeth Marshall, Newfoundland and Labrador.
The Chair: Honourable senators, a copy of the public minutes from February 28, 2019, is in your package. Are there any changes or questions? Can I have a motion to adopt the minutes? Senator Dean, thank you. It is moved by Senator Dean to adopt the minutes. Agreed?
Hon. Senators: Agreed.
The Chair: Carried. The next item is a report from the subcommittee on committees and budgets.
Senator Tannas: Honourable senators, I have the honour to present the twenty-fourth report of the subcommittee on committee budgets, which includes a recommendation regarding witness expenses for the current fiscal year and recommended allocations for two legislative committee budgets for the upcoming fiscal year.
I’ll start with the current fiscal year, which ends March 31. For the 2018-19 fiscal year, the Senate approved a budget of $2.382 million for Senate committees. Of that amount, we set aside $500,000 for certain expenditures which are charged to a central budget managed by the committees directorate, including witness expenses and videoconferencing fees. So far, in the current year, Senate committees have heard from 2,158 witnesses, the previous highest number was in 2014-15 when committees heard from 2,116 witnesses in total. This is due in part to the creation of three special committees along with overall increases in the number of meetings and the hours over the past year.
As of March 20, 2019, $456,277 of the $500,000 has been spent from the central budget.
Based on the anticipated witness claims still to be received for the months of February and March 2019, during which 424 witnesses appeared before Senate committees, it is estimated that an additional $75,000 will be required to cover the expenses to the end of the fiscal year, but it is difficult to predict an exact amount at this point. There is, however, a surplus of just over $600,000 in the other portion of the budget, the $1.8 million for committee travel, some of which could be transferred to cover the remaining expenses that we require to cover off the $75,000 extra and be now allocated to the witness expense budget.
Your subcommittee recommends that the Standing Committee on Internal Economy, Budgets and Administration approve a transfer of funds from the surplus in the committee travel budgets to the central budget for witnesses and other expenses to cover expenses to the end of the fiscal year 2018-19, which amount not to exceed $75,000.
In the next fiscal year, which starts April 1, before reviewing each budget request I wanted to provide context. For the upcoming 2019-20 fiscal year, the total funds available for the committee expenses will be similar to last year — in fact, exactly the same — $2.382 million less $500,000 for witness expenses, which will leave $1.882 million for the release to individual committee budgets for travel.
During the current 2018-19 fiscal year, the subcommittee has recommended the release of $1,332,211 on 16 committee travel activities. To date, 15 trips have been completed. As of March 20, 2019, these committees have spent or committed 669 to fund the bulk of these trips.
The subcommittee met earlier this week to review two new budget requests, both are legislative budgets and include requests for funds to hold public hearings within Canada. The total amount requested is $628,732. We met with the chair and deputy chairs of the Transport Committee, who presented a budget application which contained a proposed expenditure of $136,640 for one activity, which is public hearings in British Columbia. This is in relation to their study on Bill C-48, an act respecting the regulation of vessels that transport crude oil or persistent oil to or from ports or marine installations located along the north coast of British Columbia. This legislative budget includes funds for 12 senators to travel. The committee has also requested to include funds for three senators’ staff to travel with them.
The subcommittee would like to remind committees that all senators are now able to have their staff travel with them to assist in carrying out parliamentary functions by using their own travel points. However, the SOMP also permits committees to include expenses of the chair and the deputy chair’s staff in their committee budget requests. The subcommittee indicated previously that they would consider each one of those requests, specifically for deputy chair and chair travel, as part of the expense. We would consider those on a case-by-case basis.
Having carefully considered this particular request, the subcommittee feels that the interests of the committee will best be served by including the deputy chair and chair’s staff within the budget.
Based on this information, the subcommittee therefore recommends the release of funds for this activity, activity 1, in the amount of $136,640. We also met with the chair and the deputy chair of the energy committee who presented a budget application containing proposed expenditures of $492,092 for two activities. The first activity is public hearings in Western Canada, in a number of centres, and the second activity is public hearings in Eastern Canada, again, in a number of centres. The Western Canadian portion was expected to cost $280,888 and the eastern portion is estimated at $250,000.
This is in relation to their study on Bill C-69, an act to enact the impact assessment act and the Canadian energy regulator act, to amend the Navigation Protection Act and make consequential amendments to other acts. This legislative budget includes funds for 14 senators to travel. The committee also requested to include funds for two senators’ staff to travel.
Having also carefully considered that particular request, the subcommittee feels that the interests of the committee would best be served by including the senators’ staff in the budget. Based on the information provided, the subcommittee therefore recommends the release of funds for activity 1 in the amount of $280,888 and activity 2 in the amount of $211,204. In total, your subcommittee is recommending the release of $628,732 today from the total of the $1.882 million set aside for committee expenses.
As in past years, the subcommittee notes that, typically, committees’ actual expenditures are often closer to about 40 per cent of the total budget request. This means that we can expect the amount of unspent funds to be returned to or clawed back to the main budget well before the end of this fiscal year.
That gave us some comfort, colleagues, when we looked at these large numbers. We know that we typically budget a significantly higher number than actually ever gets spent. We knew that because both committees are proposing to travel quite quickly that the overage would come back before we would have to make any additional decisions or worry about any budget ceilings we would have for additional committee trips.
Unless there are further questions, I recommend the adoption of the report.
The Chair: We will open it up for questions.
Senator Batters: Thanks very much. We appreciate that, Senator Tannas. My question pertains to the item on Bill C-48 travel for the Transport Committee. This particular committee item deals with the Bill C-48 anti-West Coast tanker bill. When I see this, I’m surprised there’s no travel being proposed to Alberta and Saskatchewan as part of the study, given the huge impact on Alberta and my home province of Saskatchewan from this bill for the oil industry. The oil that comes, in large part, from Alberta and Saskatchewan would be what would go into those tankers.
I have personally heard major opposition to this bill from people in my province, and I wonder if when this matter was dealt with at Transport Committee — I don’t know if you know this or can find this out for us — was this unanimously agreed to? Were there any senators from Alberta and Saskatchewan who voiced concern about that? If you could provide guidance, that would be appreciated.
Senator Tannas: We had a visit about that at the subcommittee. The chair made it clear that it was not unanimous; that the trip involve only British Columbia. There was, in fact, quite a bit of discussion and, ultimately, a vote — I believe the vote was held in public — about the question of an Alberta and Saskatchewan portion. It was not carried by the committee. They are the masters of their own business, so we had no choice but to deal with what was in front of us.
Senator Batters: You are talking about the Transport Committee chair making that decision?
Senator Tannas: The chair, exactly.
Senator Batters: Senator Tkachuk. Okay, thank you.
Senator Munson: Full disclosure: I sit on the subcommittee that approved the two trips, which are very important. It is a third of the overall budget for next year. I’m concerned for other committees. Do you feel there is enough left over for other committees? There are other important issues in the country and we are giving up a third of our budget.
Senator Tannas: There are a few of things to consider. Last year, the one that is closing out right now, we had a $600,000 surplus that was not used by committees. Just using that and projecting that onto the same activities for the coming year, we can afford what is roughly an extra $600,000 worth of expenses.
The other thing we considered and discussed at the subcommittee was the fact that there is an election, and that will further shrink the time frames for travel activities for senators. We think we are probably okay for the coming fiscal year, because of the election and the shortened work season for us, if you will.
But this will be the third time a committee has requested money to travel specifically on a study of legislation. If this is something that committees are going to continue to do, then I think we need to look at and review the quantum that we have used over the last number of years for committee budgets with a view to potentially expanding them. If an important piece of the work that Senate committees do is travelling the country, that would be a good discussion to have.
Senator Munson: On the other travel of Transport and Communications, was there any indication that the committee in British Columbia would actually travel to Kitimat? They have Prince Rupert and Terrace, but Kitimat seems to be a strategic place to visit.
Senator Tannas: I agree. It’s a 40-minute drive down a nice paved road, and it is about to become an important transportation centre for LNG. The subcommittee put that suggestion in the ears of the Transport Committee that if they had a spare few hours, it would be worth it to take a run down there.
Senator Dean: This will sound rather obvious, but these costs strike me as high. They strike me as being excessively high. I’m hearing that this constitutes one third of the entire committee budget.
I will ask the obvious questions: First, how much consideration was given to alternative means of reaching out? We often talk about teleconferences or scoping down more narrowly the breadth. I’m thinking, in particular, about the Bill C-69 study.
I would be interested in the purpose of these committee studies. By that, I’m asking if it was the view of the proponents of this breadth and expense of travel that this was about giving voice to people, or was it about learning something that we don’t know already?
Those are some of the questions that most Canadians would be asking and I thought they should be asked at this meeting.
Senator Tannas: Those are both good questions. With respect to the costs, and this is something that we have struggled with here and have tried different methods to encourage budgeting that didn’t always involve a 50 per cent over-budgeting. We have not been successful in that. There is a system that is used that ensures there will never be a shortfall. The whole exercise is that, God forbid, we should make a mistake and under-budget.
So we wind up with $600,000 for the two studies combined, and we have every expectation that we will get at least $250,000 of that back; that it just will not be spent because it will have been over-budgeted. That is our reality. So when we look at the numbers, we have all been conditioned at Internal Economy and those of us on the subcommittee that we have to discount them by 40 per cent.
Second, with respect to travel, we heard from the Transport Committee that technology in the North makes it difficult, and that there were dozens of witnesses from that area who wanted to speak. Trying to do it through video conference in that area was problematic. In fact, the chair mentioned that their very first video conference went down.
So given the amount of attention and the concentration in a specific geographic territory, they felt it was important to get out there and talk to the Indigenous communities that are dispersed but which could come to one the two centres, Prince George or Terrace.
With respect to Bill C-69, we heard less from the committee — although we did — but the fact of the matter, senator, is that this is, in many people’s view, including my own as an Albertan, a potential bomb for this country and for the unity of this country. There are very few bills where hundreds of ordinary working people get in their trucks and drive to Ottawa quite spontaneously. I think it’s fair to say they represent the tip of a very large iceberg.
So we felt that, given the stakes, it was important that the representatives of the regions — and that’s who we are, and this is a regional issue — needed to go to hear and give voice to the people in those regions in Atlantic Canada, Quebec and the West.
Senator Plett: I have a few comments. I really don’t know that I have a question for Senator Tannas, but I have a few comments. I am on the Transport Committee and I want to address Senator Batters’ question.
Trust me, Senator Batters, there were those of us who tried hard and diligently to get this trip to Saskatchewan and Alberta. There are those of us who believe that the areas that are most impacted by any legislation should be visited. We shouldn’t just sit here in Ottawa and tell everybody to come to us. You do not have a proper perspective of things unless you visit a site.
Yesterday we had some Indigenous folks at the Transport Committee testifying. And one of them testified about a pipeline break on a pipeline that ran through his community and how the community rallied around, together with Husky Oil to clean it up and how good a job they had done at cleaning it up, and they were strong opponents of Bill C-48. They had some excellent testimony as to how, when there are disasters that happen, people can rally. But when you just hear people here in Ottawa or indeed even by teleconference or video conference, it’s very difficult to get the true picture.
Many of us believe that the areas most impacted are indeed British Columbia, but most certainly Alberta and Saskatchewan are impacted because of economic development and so on and so forth. We were met by opposition on every motion that we made, including the motions I made in this regard, and I’m disappointed about that.
Nevertheless, the committee — and I do believe in the democratic process — voted against those motions and voted in favour of this trip. So I think it’s incumbent on us to approve what the committee — the committees are masters of their own destiny to a large extent and we need to accept that vote, and I fully support these recommendations here. Just a little further to the budget, indeed, they are always overbudgeted. I have been involved for quite some years now and I know for a fact that for the Transport Committee trip, not all 12 senators are going. I know that because I won’t be going. So there will be savings there. I’m sure there are some others.
I know that on the Energy Committee trip, there are senators who are not going for the entire trips. And when they go to New Brunswick, some New Brunswick senators are subbing so that we can save some dollars there. We do a lot of that. So most certainly these costs will come down. And much as I was frustrated about was happened at the Transport Committee, I do support these recommendations.
Senator D. Black: I’m here subbing for Senator Verner and I’m pleased to be here because I have never been to an Internal Economy meeting.
First, Senator Tannas, thank you very much for your comments, specifically in respect to Senator Dean’s very good questions.
Senator Dean, there is no doubt that not only are the trips about giving voice, it is about hearing substantive material from folks who just can’t get here for whatever reason.
I would identify with Senator Tannas’ comments. Senator Batters has asked a very important question in respect of why, with respect, the Transport Committee is doing a half job. That’s was my question at the time. I will be calling publicly today for the Transport Committee to reconsider their decision because I believe it’s a half job.
It is so important to go to Kitimat and Prince Rupert and Terrace; I completely agree and have advocated for that. But the committee must hear from the folks in Fort McMurray and, in my respectful opinion, certain places in Saskatchewan. We are talking likely two days. I will be calling for that because I think it’s the wrong decision and it will be misinterpreted. I wanted to share that with this committee so people are not surprised. That’s what I’m going to do because I think the committee has taken a decision that could be unhelpful long term.
Thank you, chair.
[Translation]
Senator Forest: I am a member of the Subcommittee on Committee Budgets. This committee has received two very important requests which represent a third of the overall budget. In this case, the members of the committee wanted to know if all the means available to hear witnesses had been looked at, in order to reduce the costs which are rather exceptional. If I am not mistaken, this is the first time since 1998 that a committee has travelled for the study of a bill before the Senate.
I think we have to follow these two missions very closely. On the one hand, we are studying a lot of bills at this time. On the other hand, Canada’s territory is very vast. In my opinion, since the principle of fairness is a fundamental management principle, it goes without saying that all of our decisions must be legal but also fair.
The committee has approved travel within Canada for the study of two bills. I am not judging the relevance of that, but clearly we will have to follow the impact of that decision closely, because when we receive requests later relating to the study of other bills, we will have to use criteria to evaluate the situation fairly, since this can have a major impact on the budget.
With respect to this decision, we first questioned the two committees with regard to their objectives and the steps in their communications plan. I agree with this decision of the committee. However, we have to be aware of the impact on our budget if we decide to travel in connection with all of the bills we are studying. Of course, that would be ideal, but between the ideal situation and a balanced budget, it is our responsibility as the managers of public funds to analyze things properly.
[English]
Senator Marshall: I was on that subcommittee as a permanent member a number of years ago, and I did attend the meeting yesterday when we were considering these two proposals. We always budget for all the members of the committee to go and I don’t remember ever having all members attend these trips. You probably come in with maybe half the senators attending these trips. So while the budget is high, I don’t have a problem with it.
But I did want to speak to Senator Dean’s comment with regard to why we’re doing this. The National Finance Committee, which rarely travels — actually it has only travelled twice in my memory in the last 10 years. We went across the country and had hearings on Minister Morneau’s proposed tax changes to small businesses. I found going across the country and hearing from business owners, meeting them and having tours of some small businesses to be really informative. It’s fine to sit in our committee rooms and hear experts come in, but when you go out and listen to people in these communities, you get a different perspective.
For National Finance, which was several years ago now, that was a very worthwhile experience. We also visited Miramichi, when we were studying the Phoenix system, for one day. And that was a worthwhile experience.
I know we have to be selective, but going on the road is very beneficial. I just want to assure you of that.
The Chair: Thank you, senators. That was a good perspective on issues, but I think we should move forward.
It is moved by the Senator Tannas that the report be adopted. Is it agreed to adopt the motion?
Some Hon. Senators: Agreed.
Some Hon. Senators: On division.
The Chair: Agreed, on division.
Item 3, colleagues, is the report from the Subcommittee on Human Resources. Senator Saint-Germain will give us a brief overview of the main changes on the report following our discussion at the last meeting.
[Translation]
Senator Saint-Germain: You will remember that at our last meeting, we first agreed that the new Senate anti-harassment policy should define a right and appeal process for every employee of the Senate. That is the most important point, and I will get back to it in a moment.
Secondly, we wanted the linguistic concordance between the French and English versions of recommendations 22 and 23 to be reviewed to specify that CIBA must sit in camera on appeal. As you can see, that technical error was corrected.
Finally, the use of the expression “portée en appel ou examinée” was to be shortened to “portée en appel,” and that has been done.
I want to emphasize that the comments that were made at the last meeting, particularly with regard to the need for a right of appeal for all employees, allowed us to improve the subcommittee’s report, and all of the members of the subcommittee who were consulted since the last meeting approved it. Recommendations 22 and 23 have thus been amended as proposed. You received them in your package this week; consequently, I will not read them. I’d simply like to emphasize something with regard to the appeal process. Should we reach that point, it is clear that the senators or administration managers whose employees would be involved in a harassment case will have done everything possible to prevent the situation; but if the harassment prevention measures have failed despite their good faith, this will trigger an appeal, following an independent investigation.
In order to respect the opinions expressed at the last meeting, recommendations 22 and 23 now contain: a more precise definition of the rights of all parties; the possibility for the complainant and the respondent to submit their comments on the investigation report to the competent authority charged with imposing remedies or penalties, or not; an extended period to allow the senator whose employee is the respondent to submit to the competent authority their recommendations on the remedial action or penalties deemed appropriate; an explicit right and mandatory appeal process, clearly and distinctly expressed — these measures are set out in new recommendations 22 and 23 — both for the complainant and the respondent if they are not satisfied with the decision, and not only in cases where a penalty is imposed; a measured, progressive and fair approach for all parties involved, from the competent authority to the appeal process; a modern structure, adapted to the respondent, which respects procedural fairness, the impartiality of the process, the protection of privacy, and parliamentary privilege.
To facilitate understanding, we prepared a table on recommendations 22 and 23 which summarizes the procedure when dealing with a senator’s staff member, employees of the administration, of relevant sector chiefs or members of the executive committee, which will allow you to see that we have adapted the process to make its application fair, no matter what sector of the Senate organizational chart is involved.
In light of all that, and since we have followed through on the comments and recommendations of all the members at the last meeting, I move the adoption of the report.
[English]
Senator Batters: Thank you very much. I appreciate the work on the recommendations since our last meeting.
I see there’s still a fundamental difference between recommendation 22 on the sanctions for senators’ staff and recommendation 23, the sanctions for Senate administration employees. For senators’ staff under this revised recommendation, CIBA steering, of which I am part, is still always involved with the determination of what the appropriate sanction is.
I thought we were maybe going to have a situation where the senator involved in this situation would have an opportunity, if appropriate, to make a recommendation and then, if appealed, it would go to CIBA steering. But how it’s going to instead be is the senator would be involved in the formulating of the decision, but it would not be their original decision and then subject to appeal.
Yet with Senate administration employees, for that situation, the sector chief — and I guess I need a little more clarity on how large or small some of these sectors are in Senate administration — gets to make the initial decision and they are given the power to impose that sanction, and then it’s only if it’s appealed that it would go to a further body, the executive committee.
We have many senators who were extremely capable in their past lives — they’ve run banks, insurance companies, small businesses, law firms, all this sort of thing; they’ve managed many employees in their lives — yet they’re not deemed capable potentially of making an appropriate decision. Yet we might have small sectors for Senate administration and they are given a different situation. When I say “senators” that would include, of course, the Senate government leader who has, I believe, about 15 employees in his office; and the Speaker, who also has many employees. Both of those people are senators.
I don’t understand and I fundamentally disagree with the distinction between those two categories.
[Translation]
Senator Saint-Germain: It is really important. The experts we consulted urged us to proceed in this way. I will reiterate that senators’ employees were very clear on this matter, and the size of the senator’s offices should be taken into account. It is very rare for a senator to have more than three employees. This does not apply to the Speaker or to the government representative in the Senate. The issue is that it is very difficult, in that context, when the process has reached the appeal, in a context where there has been a complaint and the situation has not been resolved, and either the complainant or the respondent is dissatisfied. The senator may submit his recommendation to the Standing Committee of Internal Economy, Budgets and Administration and make all of his comments, but to have him involved directly in the appeal would be a problem. The offices are too small, and it would be very difficult to achieve impartiality in some cases.
I think the process we are proposing, which is in line with best practices, is really fair. The distinction regarding the administration is really important, because within the administration, there are directors, but also an executive director and an executive committee. Applying that to the employees involves the CIBA steering committee and then CIBA as a whole, and the Senate remains the ultimate appeal body, should things proceed to that point. I believe that the process is fair and proportional, and this is a fundamental issue we must understand. Senators in this case have a voice, but the need for a higher authority that eliminates any perception of partiality is fundamental.
[English]
Senator Batters: I can see, and I basically agreed when we were discussing it last time, that the appeal could go to a different body, like steering, for senators’ staff. But I don’t understand why a senator, including potentially the government leader or the Speaker, who have a large number of staff, are not treated as equal to a Senate administration sector chief, given that they can’t make the original sanction decision; they can only have input into what the decision of CIBA steering is. Why is CIBA steering more equipped to make that decision than the actual senator? Why not just give them the right of appeal?
[Translation]
Senator Saint-Germain: I won’t repeat what I just said. You must understand what I just said regarding the senators’ offices. This does not apply to the Speaker or to the government representative in the Senate, who have their own teams. The small number of employees in senators’ offices means that we must take measures that will at the very least protect us from any perception of partiality or attempts to manage the situation, in a context where it will be very difficult to make impartial decisions without the support of another entity, which would be the steering committee of CIBA, and potentially, CIBA as a whole.
[English]
Senator Batters: These sector chiefs, what sort of level would that be and what would be the smallest sector that would exist in Senate administration?
[Translation]
Senator Saint-Germain: I don’t have the specific data, but it concerns the directors, those who have a formal responsibility for the performance assessments of employees. They are the managers. For the smaller unit, I will yield the floor to the clerk.
[English]
Senator Tannas: In our advice that we received, the sector chiefs were Pascale and Richard and, under our current structure, the vacant Law Clerk. Those are the sector chiefs. There isn’t going to be a loading dock supervisor deciding on this. The first decision for administration is the top of the chain in the administration — Richard, Pascale and whoever the Law Clerk is.
Senator Batters: That’s not at all clear from that wording, using that sector chief thing, because that sounds a lot higher up than I would have thought sector chief would have been. I thought maybe that would be in supervisor.
Senator Tannas: We’ll clarify that in the actual granular policy that will get written off of this kind of high-level — because I think that is what we in the subcommittee understood it to be and that’s what it needs to be.
Senator Dean: First, thank you for the clarity that we’ve just heard, because I think Senator Batters raised a very good question about who we’re talking about when we’re talking about sector chiefs.
Senator Batters, you also, I think, made a very good point in saying that some senators understand the world of human resource management and the culture of workplaces, and that may be an argument in giving them a little bit more involvement in this than is contemplated.
Of course, that proposition also assumes that there are a number of senators who don’t have those competencies, and those are the ones we’re worried about, quite frankly, here. We’re worried about situations in which an issue gets away from a senator. And that does happen. It happens in all workplaces. We’re not talking about issues or a process or principles here that we don’t find common in lots of other workplaces, including workplaces that I have worked in.
First of all, we have to be concerned about a situation where we have, I’m going to say, a less-than-aware senator, for reasons that may be completely understandable.
In general, when we look at workplace harassment policies, we find that we look to senior management involvement in the determination of final decision-making. I did note, as I read this last night — and it seems to me a considerable effort has been made here to be inclusive of senators’ involvement. I might have expected, as I started to read this document, that we would see a reference to senators being consulted. I would have actually been very happy with that. It goes further. It contemplates a recommendation from a senator. I think, in terms of external comparators, this is pretty generous, frankly, to the senator. I’m inclined to support it, but I think there needs to be some balance here.
I commend the drafters of this reframed approach. I think it does provide some voice, some input for senators, while realizing that the senator’s voice in complex matters of this sort should just be one voice. I’m grateful for Senator Batters raising important questions. I’m also grateful for the drafters for bringing us back a workable, reasonable and well-balanced compromise.
Senator Housakos: I’ll be very uncharacteristically brief. I understand the committee has tried to address all the issues and there aren’t any easy solutions. Again, in the model we’re being presented here, an employee can file a complaint, go through this whole structured process of external professionals, come back and their final place of appeal is the executive administrative committee, which is, of course, our three highest officers in the administration.
I’ll ask people to go back and review the most recent and high-profile case we had a few years ago with our former director of HR, which is a senior member of the administration, where we ended up in court and before the Ontario labour board. At the end of the day — and I didn’t agree with this argument, but nonetheless — he felt he didn’t have the right to go before Internal Economy, before senators, to plead his case.
I assure you, you’re going to have many instances of employees whose grievance often might be directly with an administrative decision, an operational decision and ends in a conflict with their senior officers. They’re going to come back and publicly say to senators that this happened and I didn’t have the right to go before the people who are responsible for the Senate, which is Internal Economy and, fundamentally, the Senate.
So I compel you to review that case, the Darshan Singh case. He was our HR director who was let go and it ended up becoming a two-year-long, messy, public exercise. His argument was that he was prevented by his bosses to go before senators and bring important information to them.
Senator Marshall: The issue Senator Batters raised was one I raised last week. The subcommittee has obviously taken our comments into consideration, so I think we really dealt with it enough. Down the road we may end up with a situation that the senator agrees with the steering committee. I’m satisfied that the subcommittee looked at it, that based on what they did, this is what they feel we should go with. After we have a couple of experiences, we may want to go back and review it.
I was concerned. I think it diminishes the responsibility of the senator. I know for myself I’ve had some very senior jobs in the Newfoundland public service. I think I’m fully capable of dealing with harassment issues, but I defer to my subcommittee.
[Translation]
Senator Forest: This report is not our policy. It will be used to develop the policy, which is very important for all of our employees in the current context. It is clear that, for more specific concerns, the policy will allow us to have that discussion. At this point you must understand that we are not preparing the policy, but we are giving ourselves the components, values and necessary bases. This suits me perfectly, and I hope that today we will vote so that we can finally begin drafting the anti-harassment policy.
[English]
Senator Tannas: First of all, I think Senator Saint-Germain and I, and other members of the subcommittee would agree there’s been good work done here and that this was worth the time that we’ve taken. I want to thank everybody who has stopped us. We have paused and made significant improvements, I think, to what was originally presented.
The issue that Senator Housakos raises comes a bit from the potential confusion of sector chief and executive committee. The way the sanctions for administration employees reads here, it’s like the sector chief could not be a member of the executive committee, when the reality of our current structure is every sector chief, of which there are two, with one vacant, is a member of the executive committee.
To Senator Housakos’ point, Darshan would have come to the steering committee because Darshan’s accusations were against his boss. His boss was a member of the executive committee, right?
Senator Housakos: No, that’s the problem. What would end up happening is that the file would be transferred over to one of the two other executives, the way this is —
Senator Tannas: No, it says if it’s a member of the executive committee.
Senator Housakos: No, but the HR director is not a member of the executive committee.
Senator Tannas: But Darshan was accusing somebody who was a member of the executive committee.
Senator Housakos: His direct boss. So then it went over to the Clerk and the Law Clerk.
Senator Tannas: No. The Clerk and the Law Clerk are members of the executive committee and it says if it’s a member of the executive committee that’s being accused, it goes to steering.
In the policy, we need to make it clear that the sector chiefs and the executive committee are one and the same so we can get rid of that.
The Chair: I think you’re right.
Senator Tannas: We’ll fix that in the policy and the policy will come back here for ratification before we send it off to the Senate. Thank you.
The Chair: If there are no other questions, it is moved by Senator Saint-Germain that the proposed amendments be adopted; that the report be amended as adopted; and that the report be tabled in the Senate.
Senator Tkachuk: I wanted to make a point. I think it will be important when it’s tabled in the Senate that it isn’t asked that it be approved immediately, that it be adjourned and that there be some time for senators to look at it and read it before it’s adopted.
The Chair: Again, I will repeat: It was moved by Senator Saint-Germain that the proposed amendments be adopted; that the report as amended be adopted; and that the report be tabled in the Senate.
Is it agreed, honourable colleagues?
Hon. Senators: Agreed.
An Hon. Senator: On division.
The Chair: Carried, on division.
The next item is Motion No. 328 on the appointment process for the Clerk of the Senate, which was adopted in the Senate chamber on December 6, 2018.
A briefing note and a draft report were distributed in your package. The draft report includes a recommendation that CIBA will table in the Senate Chamber.
I will invite Catherine Beaudoin, Deputy Law Clerk and Parliamentary Counsel, to the witness table to answer any legal questions.
Are there any questions or comments? If there are none, then there’s no need. Can I have a mover for the following motion: That the draft report be adopted and presented in the Senate?
Is it agreed, honourable senators?
Hon. Senators: Agreed.
The Chair: Carried.
It was moved by Senator Batters.
The next item is the Senate Emblem Policy and Guidelines. In the last 24 hours I’ve had a few suggestions made to me on these guidelines. So that I can look into them further, I recommend the review be deferred until I have had a chance to do so. Upon completion of the review, it will tabled to steering and this committee again will follow the normal process. Do I have your agreement, senators?
Senator Moncion: Could we have an idea of the issues?
The Chair: The Speaker would like to be consulted. I think we would like the Speaker’s concurrence. That was really the main issue.
Senator Moncion: Thank you.
The Chair: The next item is a presentation on the payroll system conversion. I invite Monique Daigle, Lead, Employee Experience, Human Resources Directorate; and Natalie Strittmatter, Transformation Lead, to the witness table.
Welcome, Monique and Natalie.
Monique Daigle, Lead, Employee Experience, Human Resources Directorate, Senate of Canada: Thank you for your time. The purpose of this briefing is to provide an update on the implementation of the new payroll solution and recommend a go-live date.
The project team has been working since June 2018 with many internal and external stakeholders to implement the new solution. We come to you today with three different possible go-live scenarios and wanted to share the implications and issues faced with each of these different options.
The first of these issues would be a mid-year data conversion. A mid-year go-live would require the project team to convert additional year-to-date data from Phoenix. This additional data conversion increases the project risk significantly due to the known accuracy data issues within Phoenix.
Another issue we are facing is the duplication of efforts. The interim available solution, pending the implementation of an automated integration with the Resource Management System — that’s called Unit4 — is complex and requires intensive manual intervention. The interim solution would increase the risk of input error and could potentially create more problems than the status quo.
Resource capacity is another issue I would like to mention today. The planned go-live date for the implementation of the Resource Management System, Unit4, is April 1, 2019. The same resources, which are the Senate compensation advisers, are key to both the payroll and the new Resource Management System implementations. By working on these two major system projects in parallel, there is a significant increased risk in terms of resource capacity.
[Translation]
The Senate does not sit during the summer, and there will be federal elections in the fall. Introducing the new system in the fall may present some communications challenges. However, even if CIBA has intersessional powers when the Senate is not sitting, and the subcommittee has decision-making powers, when CIBA does not meet, that scenario for launching the pay system is not ideal, since the majority of senators will not be physically present.
The last problem I want to share with you today concerns the proliferation of tax forms. If the launch takes place during the fiscal year, the employees and senators will receive two T4 forms at the end of the year. This situation could be a source of confusion. However, we think it will be possible to mitigate this risk through a targeted communication plan.
[English]
After taking into consideration all of the issues — resourcing, readiness — it was determined that the optimal option is by going live January 1, 2020. We ask for your support and approval of a January 2020 go-live.
Thank you for your time. Natalie and I are available to answer any questions you may have.
The Chair: Any questions for Monique?
Senator Marshall: I know you’re recommending January, but would you be ready by June 1 if we decided on June 1?
Natalie Strittmatter, Transformation Lead, Human Resources Directorate, Senate of Canada: June would be a riskier approach in terms of timing. At this point in our project, we have worked heavily with ADP in configuring the payroll calculation engine. It’s really in the integration, the data feed, that giving us this extra time will allow us to reduce the risk and increase the accuracy of that payroll.
Senator Marshall: If we decided June —
Ms. Strittmatter: We wouldn’t have the integration.
Ms. Daigle: With the Unit4 system, we can input the data and then it flows to the payroll solution. So in June we would have double entry. We would be doing entry into two systems.
Senator Marshall: But if we wanted to do it, could you do it? Would you be ready to do it? If we said here today we don’t want to wait until January 1, would you be ready?
Ms. Strittmatter: Senator, to be honest, at this point, given just the timing of this presentation, it would be very tight. I would have to negotiate with our service provider and go back to our stakeholders. The likelihood of a successful June go-live at this stage —
Senator Marshall: Is risky?
Ms. Strittmatter: It’s beyond that; very risky.
Senator Marshall: You made a comment in your opening remarks about resource capacity. Do we have enough resources now to run that new system?
Ms. Daigle: Yes. The resource capacity is due to the implementation of the Unit4, the new system that’s going through. The resources are currently training to use this new system. Therefore, they can’t be working on the payroll implementation solution at the same time. By the fall, the Unit4 should be up and running with no issues. Therefore, they can spend their time on the new payroll solution.
[Translation]
Senator Moncion: Can you tell us about the pilot project you started? I imagine you are using both systems in parallel in order to ensure that the information that is transferred from one system to the other is accurate?
Ms. Strittmatter: You are talking about our approach to the tests?
Senator Moncion: Yes.
Ms. Strittmatter: We are working with ADP and our other suppliers to define all of that. Our approach is to carry out configuration tests and then to do parallel tests. To date we have carried out three parallel tests on the configuration system and obtained a success rate of 98 per cent. There were a few mistakes on the training side, but we were able to resolve certain configuration issues.
However, with the integration of the new Unit-4 system, we have to redo the test cycles and go through what we call —
[English]
— user integration testing and parallel testing. We would be testing for the January go live from the end of August through to November, doing our data conversion, and final go live for January.
Senator Moncion: Would you be reporting back to us before you go live with all the caveats?
Ms. Strittmatter: Yes.
Senator Batters: Thanks very much. When we are dealing with the issue of replacing the Phoenix payroll system for the whole Senate, I think that risky at any level is not what we want at all. We want to be as prudent as possible. For that reason, I think a January 2020 date is the most feasible here. It is only 10 months away, so thanks very much.
The Chair: Can I have a mover for the following motion:
That the committee endorses the recommendation of implementing the ADP payroll solution for the first pay period of January 2020.
Is it agreed, honourable senators?
Hon. Senators: Agreed.
The Chair: The next item is a motion for the creation of the advisory working group on senators’ pensions.
[Translation]
Senator Moncion: The next item is the creation of the advisory working group on the review of the senators’ pension plan; its membership would be established from the Standing Committee of Internal Economy, Budgets and Administration, as follows: two members from the Independent Senators Group, two members from the Conservative caucus and one member from the Senate Liberal caucus — they are members of Internal Economy; the quorum for the advisory working group would be three members; the mandate of the advisory group would be to examine the current senators’ pension plan and make recommendations for improvement; the advisory working group would provide a report no later than June 30, 2019.
Until now, the senators who have expressed an interest in being a part of the working group are the following: Senator Tannas, Senator Marshall, Senator Mitchell, myself, and we need to confirm one person from the Independent Senators Group.
[English]
The Chair: I think you mentioned two senators from the ISG, two from the Conservative caucus and one from the Liberals. If Senator Mitchell is going to be there, I think we should mention there will be one representative of the government as well, otherwise he does not fall into any of those categories.
Senator Moncion: He doesn’t represent the government?
The Chair: He does. You only have two members of ISG, two members of Conservatives and one member of the Liberals. Senator Mitchell doesn’t fall under any of those.
We should add that “and one member of the government represented in the Senate.”
Senator Moncion: So we will be six on the committee. That is what you are saying.
Senator Batters: On this particular point, but then he would be a non-voting member, just like he is a non-voting member on CIBA.
Senator Moncion: I am confused now. Are we six or five?
The Chair: I think there will be six, but one person who is non-voting.
Senator Batters: One non-voting member.
Senator Moncion: Still confused. I know non-voting, but is he part of the five or is he number six? So you would have two from the Liberals.
Senator Tkachuk: He doesn’t vote. He comes to the meeting but doesn’t vote.
The Chair: I will read out the motion. It is moved by Senator Moncion that the advisory working group on the review of the senators’ pension plan be established from the membership of the Standing Committee on Internal Economy, Budgets and Administration as follows: two members from the Independent Senators Group, two members from the Conservative caucus, one member from the Senate Liberal caucus and one representative of the government who will be ex officio; that the quorum for the advisory working group be three; that the mandate of the advisory working group be to examine the current pensions plan and make recommendations for improvement; that advisory working group provide a report no later than June 30, 2019.
Is it agreed, honourable senators?
Senator Plett: I really would like the wording changed to “non-voting ex officio” not just “ex officio.”
The Chair: Is it agreed, honourable senators?
Hon. Senators: Agreed.
The Chair: Agreed, as amended.
Next item is Item No. 8, which is the report from the Audit Subcommittee on the results of special audit conducted by KPMG on the process and timeliness of senators’ expense claims. This report is for information only. I invite Pierre Lanctôt, Chief Financial Officer, Finance and Procurement Directorate, to the table.
[Translation]
Senator Moncion: The Audit Subcommittee of the Standing Committee on Internal Economy, Budgets and Administration has the honour to table its fourteenth report. Your subcommittee has reviewed the report entitled Senator Expense Claims-Policy and Performance Review, and now tables the report for information.
This review of the policy adherence and performance over service levels of senators’ expense claims included reviewing existing policies and service level standards, and testing the administrations’ adherence to the policy and service level targets.
The review was conducted by the professional services firm of KPMG.
[English]
Four recommendations were provided by KPMG. The first touches on training of the office staff of senators in an effort to reduce the number of incomplete applications that are submitted.
The second is to make it mandatory for the staff from senators’ offices to use the electronic claims software to reduce repayment delays.
The third and fourth recommendations are for administration employees to further document the reasons for incomplete applications, which will allow multiple users to easily do follow-ups on incomplete claims.
The members of the Audit Subcommittee assessed the response provided by the Senate administration and were satisfied with the proposed corrective measures. It’s respectfully submitted by myself.
Now, I wanted to mention that I did not ask KPMG to be here today because there was nothing that was not working well with the way things are going, and the comments that were identified or the recommendations touched more on the way we work with the system, so staff and information that is being inputted into the system. And you have the report, which was very well done.
The Chair: Any questions for Senator Moncion?
Senator Marshall: Senator Moncion, you won’t be surprised to hear this. Are we doing any internal audit of senators’ claims? The last audit work done I’m aware of is what the Auditor General did up to March 31, 2013. Are we doing any internal audit now?
Pierre Lanctôt, Chief Financial Officer, Finance and Procurement Directorate, Senate of Canada: We haven’t had recent internal audit on the claims. I have to admit though that we, Finance, prior to processing a claim, we actually do two reviews of the claims. We don’t have an internal audit, per se, but claims submitted for repayment are reviewed twice by the administration personnel.
Senator Marshall: I keep raising this issue. It has been five years since we’ve had a review of claims. I’ve mentioned previously that I would like to have my claims audited and at the time, I was told I could probably hire an auditor out of my office budget, which I don’t think is appropriate.
We should really talk about having some internal audit work done on our claims. Everybody is submitting their claims and we think we are doing everything above board, but we need that little bit of extra assurance. And all we need is just one incident and we’re going to be back trying to defend our expenses again.
I would really like for this committee to give it some consideration. I have raised this. I have spoken to Senator Moncion about this a couple of times. I know some of the senators don’t want to be audited. I want to be audited. I would really like for us to have some work done. It’s responsibility, it’s transparency. I know we post our expenses online, but that is not an internal audit, and I would really like some detailed work. And do ask for the support of my colleagues after six years. We have six years of claims. So, please, let’s get something done.
Senator Housakos: Colleagues, we were always doing periodic audits whenever we had the annual auditors come in to audit the administration. My understand is that — and Senator Tkachuk can confirm this — they would do random audits of various senators on an annual basis. They still do that, and that’s very important.
In terms of bringing in the Auditor General or any particular in-depth forensic audit, I remind colleagues around the table, those who weren’t here for the process, the Auditor General spent $27.5 million to recoup $163,000. Only in Parliament can you get away with something like that, because in any private sector industry, if you had auditors spending $27.5 million to recoup $163,000, do the percentage. People would be brought before a court and discussions would be had.
So we need to be cognizant that we are here to be transparent, but also accountable and efficient. When we took a decision as Internal Economy to go public with each line item of expenses on behalf of senators — you can go down every particular month on any website of any senator and everything that we order is there to be audited and reviewed by every journalist in this country. They are just as thorough as any auditor and a lot cheaper, because they are looking for a hot story. I don’t think it’s par hasard that, over the last four years, there have not been any stories about indiscretion on the part of senators. The one thing each and every one of us is afraid of is the public and the people we work for.
I think we have to keep that in mind.
[Translation]
Senator Moncion: The auditors use sampling to do their audit. They do not audit exhaustively, but if they detect anomalies, they dig deeper.
With regard to internal audits, Senator Marshall recommended — while we wait for a formal process and for people to be hired — that we hire an external auditor, not government auditors or the Auditor General of Canada, but an external firm that specializes in internal audits. This could cost the Senate less, and we would have a transparent, open and verified process.
[English]
Senator Batters: Senator Moncion, I’m glad you brought up the sampling the external auditors do of senators’ claims, because prior to mentioning that in your presentation, I was not sure if that was still happening. I thought it was, but I’m glad you clarified that. That’s a major part of the accountability step. Senator Housakos outlined it well, but I wanted to underline that major impact of the transparency and accountability that we have had for — I know in the Conservative caucus, we have been posting our expenses online for the last five years, I think. It’s a major element of sunshine it brings to that particular element.
Senator Moncion: There is no internal audit done on these expenses, and that’s likely the problem we have right now.
Senator Batters: I know, but I’m glad you brought up the external auditor doing a sampling, because that had not been mentioned earlier in your presentation.
Senator Tannas: To what Senator Moncion said, it’s my understanding, because I was involved a while ago on the recommendations around an oversight committee, that the committee would hire an internal auditor. It was left up to the committee, if I remember the recommendation, to decide whether we would have a full-time employee or a contract employee. But at the end of day, we need an internal audit process and a person who gets up every morning and executes on a plan that has been approved by somebody overseeing the internal auditor to do programs that are not just to do with senators’ expenses but with a whole range of things in the organization. That seems to be taking a long time to come to fruition, but I’m hopeful that we’ll get there.
It’s all part of improving the organization and making sure that we don’t have a repeat of the issue we had with senators’ expenses. It’s interesting; we’ve talked here on a number of things — the human resources report, the travel budgets where we’re going out. The Senate is working hard to build on a foundation to do great work and be recognized for doing great work. This is a key component of it. One lousy expense will back us up in our reputation by 10 years. We have to stay on this.
[Translation]
Senator Moncion: Hiring an employee to do the internal audit is not a bad idea in itself. My concern is that that person, who would be a member of personnel, might stand to be influenced. When we ask an outside firm to do an internal audit, the enterprise’s reputation is at stake, and the process is completely independent.
[English]
Senator Tkachuk: I don’t want anybody to go through what I had to go through. At the time and as all of these things happened, initially items came up that had to be audited, so we hired an outside auditor. We don’t have to wait for that. We can deal with it ahead of time. That was always the feeling we had after that 2013 — all those instances of problems we had. It was always the feeling that we would do internal audits on a regular basis. I’m surprised we haven’t done any.
Senator Moncion, I think it would be a really good idea and that we have a policy on it — that we do some kind of policy that we adopt that we do it on a regular basis of some sort, whether every three or five years. But there would be a process, it’d be automatic, and everybody knows it and it would happen. I think it’s hard to believe it is five years, but it is. We should look at doing that and have a plan for it.
Senator Wetston: I’m a little confused about the terminology we’re using. My understanding of the differences between internal audit and the need to have an internal auditor, versus that of external audit and auditors like we have presently. In my experience, an internal auditor would not be focused on such things as expenses. They would be focused on value-for-money. The proposition being to examine the programs internally to determine whether the programs are being delivered in accordance with the objectives or the policies.
I think that’s okay, and some organizations would benefit from that, but if we’re talking auditing expense accounts, that’s a different matter. It’s not normally the subject matter of an internal auditor but the subject matter of an auditor who has the responsibility to review these in whatever way that we are describing them. An external auditor, normally, would take on that function. It would be beneficial for the reasons outlined.
So I am suggesting that if we are thinking of an internal auditor versus that of an audit of expense accounts, from my perspective, they are different responsibilities.
Senator Tkachuk: That was a debate going on at the time: Should we have someone inside whose job would be to do internal audits from time to time, or do we go outside? It was always my view — and there was some conflict between me and the clerk at the time — but it was always my view that it should be someone from the outside. Every few years, we would have someone from the outside who would look just at expenses, not the regular audits that we do on the administration, but that we just look at expenses. You could go forward and look not only at expenses of senators but those sent in by administration staff as well.
The Chair: I would like to make one comment personally. I’m a strong supporter of what Senator Marshall had to say. Doing internal audits of our expenses should be a fundamental part of our internal control structure. The fact we don’t do it is a weakness in our current structure.
Why don’t I take it under advisement that we will come up with a process and bring it back to the audit subcommittee as to what might work and some alternatives. Then we can debate them and pick one that may work for us.
Senator Tkachuk: And do it quickly. This was my idea and the following guy, and it gets lost in the process. Then nothing happens. Do it.
Senator Moncion: Duly noted.
The Chair: Item No. 9 is another report from the audit subcommittee dealing with third quarterly financial reports.
[Translation]
Senator Moncion: Honourable senators, as chair of your Audit Subcommittee, it is my pleasure to table for information the Senate financial highlights report for the third quarter of 2018-19, for the period ending December 31, 2018.
[English]
The committee was diligent in reviewing the report and several questions were asked of the Finance team that were answered to our satisfaction. The delay in the presentation of this report is due to the parliamentary calendar.
[Translation]
The report is issued on a quarterly basis. It is prepared by the Finance and Procurement Directorate. It is not available to the public and it is not audited. The objective of this report is to provide continuous information about the usage of the Senate budget authorities, actual expenditures and forecasted spending for the current year.
[English]
In summary, the Senate budgetary authorities for 2018-19 are $109.1 million. The actual expenditures for the third quarter represent $16.3 million. Overall, based on best available information at the time the report was prepared, the Senate is forecasted to spend $100.6 million for 2018-19, or close to 92 per cent of its budget, with an overall Senate surplus of $8.5 million.
[Translation]
A surplus of $7 million over senator’s budgets is expected. The forecast assumes that the number of senators will be 105 for the remainder of the year.
The travel and telecommunication expenses will be similar to last year.
The forecast estimated for the senators’ office expenditures increased by $1.6 million this quarter in comparison to the previous quarter. This variance is due to the spending trend being higher than forecasted with recent appointments of senators.
[English]
The committees and International and Interparliamentary Affairs are forecasting a $1.4 million surplus. The surplus is explained by the committee spending trends that do not exceed a 50 per cent utilization rate of the budget, and that the IIA conferences and operations expenses came at a lower cost than planned.
[Translation]
The administration is forecasting a net surplus of $100,000, $200,000 lower than forecasted in the second quarter. This $200,000 surplus reduction can be explained by the anticipated purchases of supplies for the technical security project team and for ID cards, which expenses were not projected in the last quarter.
[English]
I will now provide the committee with an overview of significant changes to budgetary expenditures. Year-to-date actual expenditures as at December 31, 2018, have increased compared to the prior year by 9 per cent. The most significant changes occurred in four expenditure categories. Pages 7 and 8 of the report provide information on the most significant changes.
[Translation]
In the first category, for personnel, costs increased by $5.6 million due to the following: the new rates of salary increase that were approved for unrepresented employees of the Senate administration, senators’ and house officers’ employees, and unionized employees; the number of employees has increased by 17 for senators’ staff and 35 for Senate administration compared to last fiscal year during the same period; employee benefits total costs increased due to the 32.5 FTEs approved; and finally, senators’ remuneration shows an increase due to the fact that, effective April 1, 2018, senators’ basic sessional allowances were increased from $147,700 to $150,600.
[English]
The second category, transportation and telecommunications costs, increased by $400,000 compared to the same quarter of the previous fiscal year due to an increase of $500,000 of senators’ travels, including Senate committee travel explained by the fact that there were five extra sitting days. It is also explained by the decrease of $100,000 in the overall Senate administration expenses.
[Translation]
In the third category, acquisition of machinery and equipment, costs decreased by $300,000 mostly due to the purchase of office furniture and furnishings made the previous year which did not occur in the current fiscal year, and the purchase of printing equipment for $200,000, which was later reimbursed by Public Services and Procurement Canada in the fourth quarter of the last fiscal year.
[English]
The fourth category, information and publications, costs decreased by $90,000. This is mainly attributable to the purchase of the Speaker’s portrait made in the previous year which did not reoccur this year and the expenses for printing and services team, which were later reimbursed by Public Services and Procurement Canada in the fourth quarter last fiscal year.
[Translation]
This concludes my presentation of the financial highlights of the third quarter that ended December 31, 2018.
Thank you.
[English]
The Chair: Any questions for Senator Moncion? No questions?
We will move on to Item No. 10. Item No. 10 is a proposal to implement the paperless credit card account statement.
Mr. Lanctôt: Honourable senators, the Finance and Procurement Directorate reviews its processes from time to time to ensure they provide the proper control while being cost effective. We have recently reviewed the process for travel credit card reconciliation. At the Senate, travel credit cards are used by senators and members of the senior management team when required.
We have two concurrent processes for travel credit card reconciliations. First, we have a feature in our electronic claims system where transactions for each cardholder are electronically transferred from the credit card into our system and reconciled once the claims are processed. Finance reviews unreconciled transactions and follow-up with cardholders. Note that when submitting their claims cardholders sign on their expenses and provide all relevant supporting information which is then kept by Finance.
The second process, as per Senate policies, travel cardholders are responsible for reviewing and reconciling their credit card on a regular basis. Currently, the Finance team prints all individual statements, sends them to cardholders, cardholders review it, reconcile it, sign it and return it to Finance.
[Translation]
We think there is an opportunity to change our process to make it more effective and greener, while maintaining the integrity of internal control. We suggest asking travel credit card users to use our credit card provider’s web access to obtain their transaction statements and do their reconciliation.
This would eliminate the requirement to send a signed statement to the Finance Directorate, since it already reconciles transactions using the claim system, and every claim submitted by credit card holders is documented, signed, and kept by the Finance Directorate.
When reviewing the process, we noted that 42 per cent of credit card holders already use online access to obtain the details of their transactions and confirm their reconciliation. So the transition has already begun.
[English]
Our credit card provider offers secure web access that is used by a large number of cardholders in Canada. Since Finance is using the same tool to obtain individual statements, there will be no change in risk. The time saved by the Finance team will be used to process claims for additional senators.
In conclusion, the proposed change will maintain the same level of control and process integrity as is currently the case. Cardholders will continue to review their transaction statements regularly. Finance will continue to investigate unreconciled transactions. The proposed approach will reduce the consumption of paper and toner, and the level of effort required to print and distribute statements.
I will be pleased to respond to your questions and respond to your comments.
Senator Batters: Thank you very much for your work on this. I’m almost always in favour of modernization, but on this item I’m a bit more old school. I don’t do it personally. I prefer to receive my paper copies. I do see there are a significant number of senators who are voluntarily doing this, so I would prefer to see it continue to be on a voluntary basis but not to make it mandatory.
We discussed this at steering earlier, but I really don’t see much, if any, benefit to the Senate. It’s quite minimal. As well, one of the risks that isn’t outlined in this memo is the significant potential cyber security risk that could exist. We know we always have to keep on guard from the Senate perspective and financial information would only add to that potential risk.
As well, we are dealing with an institution where I’m one of the youngest senators and I’m old school in this particular method, but the average age of a senator is still somewhere around 65 years old. I know that’s not much younger than my parents, and my parents certainly don’t do anything like this. Many senators may be much more modern in that respect than my parents, perhaps, but I think for an extremely minor savings and efficiency, to keep it voluntary is great, but not to make it mandatory. Thank you.
Senator Tannas: I think this goes, in my mind, in part to what we just had the discussion on. The signing of that American Express statement is eyes on what we’re doing. We all know that while 40 per cent may have it automated, 40 per cent aren’t looking at it. Somebody else is potentially looking at it for them. I’m sure this will be frustrating for Pierre. There are times at which I think we have to tolerate inefficiencies in order to make sure that people have their eye on this and I think this is one of these cases.
I believe there are a number of senators who sign this document and look at it and will not be doing that if we automate it. It’s just that simple. I think that is risky, and the number of efficiencies that we are going to save and the loss of that efficiency, in my view, is an insurance that we should pay.
Senator Marshall: I just wanted to say I’m over 65, but I wouldn’t have a problem. I don’t have a problem with it coming. If I wanted to print it off, I could print it off. It makes no difference to me.
[Translation]
Senator Moncion: I would agree with Senator Marshall. I don’t see what the problem is. If this were my personal banking account, it would be a different story, but this is a business account.
Currently, you print a copy and you send it to us so that we can sign it. Then we return the copy to you, although our employees can easily get a copy and send it to you. Since the documents are accessible online, if we need to check something, I really don’t see a problem.
Cyber security, in this case, especially where credit cards are concerned, is not an issue.
[English]
Senator Tkachuk: Where would the savings be? If I’m printing it off in my office instead of you printing it off, what’s the difference? Except that I’m printing it off, right? I don’t understand that.
Senator Moncion: You receive an envelope. The statement is in it. You have to open the envelope. You have to sign it. You put it back in an envelope and send it back. We’re saving paper, we are saving time and we’re saving the back and forth.
Senator Tkachuk: My view would be is what’s going to happen is it will go to senators’ offices, it will be printed off, they will look at it, sign it, put it in an envelope and send it back.
Senator Munson: I’ve come around to the thinking that as long as I can print it off and take a good look at it and say I’m satisfied, I understand that. I’m not even 65; I’m 72, but I understand. I’ve come around to the idea that as long as I can see it and know these are the trips I’ve taken, that’s fine. I’ve long waited two weeks.
Senator Batters: I’m glad Senator Tannas raised the point about the accountability because that’s an extremely important point. Yes, you can print it and have that method. However, what is really changing here is the method of approving the claim. It’s not approved by you signing it. It’s approved by a simple touch of the electronic button, and I would agree with Senator Tannas that there may be a significant number of senators who don’t do that themselves but instead leave it to their assistants to do because they’re not as comfortable with that sort of thing.
I think having that signature, particularly with what we’ve gone through over the last number of years, is an appropriate and necessary part of accountability for senators’ expenses because we’re dealing here, on these particular credit cards, primarily with flights and hotels and things that are very necessary to have.
Senator Tannas: One last thing, which is to go to the anonymous button pusher who approves it. Out of the high-profile situations, two out of the three for sure blamed the fact they never saw their expenses and that their staff did it. That’s something that I always think about when I’m putting my signature on it. I’ve seen it and I’m not going to blame a staff member if something happens that calls me out.
Senator Moncion: Every expense that is on your credit card has to be backed by something on paper, right? So whenever your staff does the filing, the person probably prints off everything.
[Translation]
The employee will attach the receipts to the document and click on the button to validate the information.
The senator still has something to do, because he is responsible for each transaction on his credit card statement. In the end, when you press the button, whether the senator or a member of his staff does it, everything needs to be backed up by a supporting document showing that the senator spent this or that amount. No one can claim that the staff did it.
[English]
Senator Wetston: This is an interesting discussion because it reminds me of the considerable amount of work that’s been going on for the last 10 years in the area of behavioural economics. If you think a little bit about what that is saying, it does mean that the medium by which you access can potentially precipitate a different response, positively or negatively. It can also precipitate malfeasance and misfeasance, which is actually quite remarkable from my own perspective.
My last comment on this is to say that I very much support what Senator Moncion is saying only because I personally have had to make this transition myself in all of my own personal matters, although admittedly I still get a couple of envelopes in the mail.
When we’re in the Banking Committee and talk about technology changes and speak about privacy issues — Senator Marshall is well aware that we speak a lot about that — my only point is that often when we hear from the experts, I feel they’re appealing to millennials, individuals who are very accustomed to technology and growing up in that world. It’s not a world that I grew up in but have had to adjust to. I want to make the adjustment. So I would support what Senator Moncion is saying that I think we can make this adjustment.
You still have to examine your online statement. You still have a responsibility to do that. Whether you sign it or press a button, it’s still your responsibility, and if you print it, there is a cost to doing that.
I think we have to make this adjustment into this new environment of technology-driven matters, and I think we can do that in simple ways like this. But we’re appealing to a group, at least speaking for myself, that did not grow up with this technology and this way of functioning in the workplace.
I would support what Senator Moncion is saying and I think it’s a positive thing.
The Chair: I would like to make three points as well. To me, this is not a reduction in control. It’s elimination of a redundant control.
Second, we’re not reducing control in any way because you still sign your statement. Every senator signs a statement for which you are accountable. All the things on your credit card statement are on your expense statement. You’re signing it, so the senator is accountable. Doing it twice is redundant.
The third thing, Senator Tkachuk, is that you asked how much money there is to be saved. We keep pushing management to do things better. These small changes they’re doing to improve things all add up. There’s toner, paper, time, envelopes going back and forth, signing, things get lost then follow-up. We can’t very well ask them to do things better and then say, “No.” Then we are the problem. We are the ones unwilling to evolve and change. When this is being recommended by management, there’s virtually no downside. We’re not eliminating control. We’re saving time, paper, toner — everything. I see no reason not to recommend what management is suggesting.
Senator Tkachuk: That’s why I asked the question. I asked the simple question: How much money would we save?
The Chair: It’s hard to quantify the small things. All these things add up over time into savings.
Senator Tkachuk: It’s rare to make a decision when you don’t know how much you’re saving. If you don’t know how much you’re saving, then how do you know you’re saving anything? Logically, it makes no sense whatsoever. I don’t think I’m a dinosaur. I don’t think I am. I adapted very easily to online banking. I understand all that stuff. I’m pretty computer literate. That isn’t my point. But if I ask the question and I get no answer, then I say why are we doing this?
The Chair: Would we like to vote on this? Can I have a mover for the following motion —
Senator Moncion: I’ll move it.
The Chair: Let me read it. All agreed? On division. Let’s move on.
That brings us to the end of the public business. Any other items on public business before we go in camera?
(The committee continued in camera.)