[Recorded by Electronic Apparatus]
Tuesday, December 12, 1995
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[English]
The Chairman: I'd like to welcome Ms Labelle, the president of CIDA. She's accompanied by Mr. Robinson, who we've met before, and Ms Claudia Roberts.
We'll be discussing the outlook document this morning.
This meeting will be followed by a meeting with witnesses from the Auditor General's department, who will also speak on CIDA. Ms Labelle has told me that while she personally cannot stay, Mr. Robinson will be staying for that meeting. So we can maybe get an exchange going.Ms Labelle.
Ms Huguette Labelle (President, Canadian International Development Agency): Thank you, Mr. Chairman. I will just make some very brief introductory comments, recognizing that the topic this morning is CIDA's outlook. I would like just to pick some of the headings and make a few comments, because a number of things have happened since the outlook was prepared.
[Translation]
One of our first objectives was to increase consistency in policy development. One aim, for example, was to see how the Department of Foreign Affairs and CIDA could work more closely than they had in the past in order to ensure this consistency.
As you are already aware, a committee of deputy ministers was established and is working very well. We also have regular meetings not only with the vice-presidents and assistant deputy ministers, but also with the management team. When we hold meetings with our personnel in the field, we also invite interested representatives from Foreign Affairs, and they do the same. We have thus found means to work very closely together in our day-to-day operations.
Further to a question that arose during our last meeting, we also designated several sectors where we are attempting to rationalize our activities in order to reduce operating costs. This is the case for communications, computer services, finance, personnel and training.
[English]
We also indicated in our outlook that one of our big jobs this year would be to ensure that we align our programming with the purposes and priorities of ODA that were established as part of the policy statement of the Canadian government, including ensuring that we allocate 25% of our resources to basic human needs. So what we have done since then is to develop definitions on the basic human needs that are in keeping with the UN definition and a coding system that will allow us next year to begin to report in this way.
We have also prepared and released some statements, one on poverty reduction and one on human rights and good governance, because these were areas that we felt needed further clarification in order to ensure that the programming was in keeping with the policy statement.
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The last time we met we spoke about the integration of the program of the former Soviet Union and central eastern Europe. Mr. Chairman, I will not comment this morning on this but will be pleased to answer additional questions.
[Translation]
We also worked with the voluntary sector, as indicated in the foreign policy, in view of developing a reference guide in order to better work together. The annual meeting we held this fall with the voluntary sector enabled us to finalize a draft and we hope to have everything ready within a few weeks.
Finally, there were three other points: try to give us the additional means required to continue to increase the impact and efficiency of our work overseas; try to find better ways of reporting to the committee, to Parliament and to the public on the work we are doing, so that it is more transparent, easier to understand and to evaluate, namely as far as its efficiency is concerned.
Later this morning, you will be meeting with representatives from the Office of the Auditor General.
[English]
As you meet with the Office of the Auditor General later this morning, of course, a piece that will be important will be CIDA's renewal and our commitment to work in a more results-based approach, both at the contracting level and in the way we manage our projects and our programs throughout the agency.
Mr. Chairman, these are the only comments I would like to make as a way of introducing our topic this morning. We'll be very pleased to deal with questions, comments, and suggestions from the committee.
The Chairman: Thank you very much, Madame Labelle.
Mr. Morrison.
Mr. Morrison (Swift Current - Maple Creek - Assiniboia): Thank you, Mr. Chairman.
Mrs. Labelle, there isn't much in your outlook document with respect to contribution agreements. Since that's where the lion's share of your funding resides, I would like to ask a couple of questions about them.
The last time you were here, you did say that CIDA is always in control of the funds it allocates. With respect to the contribution agreements, what conditions are attached to the grants and contributions and what reporting responsibilities, or responsibilities, period, does the recipient organization have?
Ms Labelle: Mr. Chairman, we have a number of conditions that are attached to the contribution agreements from, of course, the statement of work. The agency doing the work would be reporting from the mechanisms, the approaches, that will be used to deliver such a content. Of course, all of these are audited and a number of them are evaluated as well, depending on the size of the contribution agreement, so that we do have a framework.
I would be very pleased, Mr. Chairman, to table with members of the committee the conditions that are part of the contribution agreement.
Mr. Morrison: You said they were audited, Mrs. Labelle, but audited by whom? What provisions are there for enforcement even if someone is in default? What can CIDA do about it?
Ms Labelle: In terms of audits, we contract with some of the audit firms. We issue a request for proposals on a periodic basis. As a result, a list is drawn up of auditing firms in Canada, which we then use to audit these contribution agreements as well as contracts that we have.
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If there is an issue, we move in immediately. At times we just work with the enterprise, with the organization, to ensure that whatever is needed is done. If the problem is such...we have at times just discontinued. We have closed the contract, and at that time we ensure that if there is another way of completing the work we see to it that it gets done.
This is not something that happens often, because we try to be very careful at the beginning in the selection of the organizations that we work with.
I have two additional points, Mr. Morrison. One is that our terms and conditions are terms and conditions that have been approved by Treasury Board. Also, we have, as part of our partnership program, a very small unit that is composed of people who review on a constant basis the risks that are associated with organizations we work with.
On the one hand we work at the level of each contribution agreement, but we also review all of the organizations' budgets, financial situation, and way of operating, on an ongoing basis.
Mr. Morrison: You said, if I understood you correctly, that there have actually been instances where there was a dispute between CIDA and the recipients and the contributions were revoked. I've never heard of such a thing. I'm wondering if you could give me a specific example of that happening. In other words, the enforcement of your priorities over theirs.
Ms Labelle: For example, a few years ago the World University Service of Canada had some financial difficulties. We began to work very intensely with them. Although it was not revocation, we really in a sense suspended our work until they could get the organization back in shape. Then we continued our work with them. There was a period of time when the organization was very much under supervision.
Mr. Morrison: That's the only one you can think of offhand?
Ms Labelle: Right now. This is not something that happens very frequently. We try to do the work at the front end, and if there is a problem, not to enter into a contribution agreement with an organization.
Mr. Morrison: If the chairman will permit me, I'm going to ask one more question.
Who at CIDA, or what entity at CIDA, is actually ultimately responsible for deciding which organizations receive funding and for setting the amounts they will be granted? Who's in charge? Is it you?
Ms Labelle: We have a delegation-of-authority instrument, since all authority resides with the minister for the grants and contributions part. Basically, it is within that framework of authority that decisions are made in terms of grants and contributions.
The disbursements of any grants and contributions over $100,000 are reviewed by the minister.
Mr. Morrison: It is the same as contracts then.
Ms Labelle: It is the same with contracts.
Mr. Morrison: Do you have the same situation in contribution agreements, where there is a procedure you follow down to $50,000, and then when you get below $15,000 it's open season, so to speak?
.0925
Ms Labelle: No. The $15,000 and below is delegated to our project director level, not below that. Then of course we have information systems that keep us informed of what happens so that we can also track what has been happening with any contracts. But contribution agreements are always higher than contracts you would have at $15,000 or less, for small amounts of work. On the contribution agreements side there would be very few, if any, that would be below $100,000, because very often if they are with voluntary organizations they are for more than one year. It might be for one, two or sometimes three years - reviewed each year.
Mr. Morrison: But, again, my question is who is the ultimate authority on these things? You say the authority is delegated, but where does the buck stop?
Ms Labelle: I think that ultimately when we're talking of disbursement of funds, the authority rests with the minister, and it is through a delegation-of-authority instrument that the various authorities are provided at different levels within the organization.
Mr. Morrison: But does the minister actually become personally involved in any of these things?
Ms Labelle: When we're looking at the contributions and contracts over $100,000, we have systems in place to do those and, yes, at the end, recommendations are made to the minister through the appropriate procedures that have been set up in the agency for that purpose.
Mr. Morrison: Okay. I've been hogging the show here.
The Chairman: I think, Mr. Morrison, everyone has been more than pleased to let you do that.
Mr. Volpe.
Mr. Volpe (Eglinton - Lawrence): Mr. Chairman, I wonder if I may follow up on that line of thinking and questioning for a moment. I noticed that the Auditor General, whose representatives we will see here in short order, has been giving at least an interim report that's favourable to the way CIDA has been undertaking its own evaluation and making adjustments to its procedures. Where my colleague opposite is going, Madame Labelle, is questioning whether the procedures are in place for making both efficient and effective decisions with respect to the use of public moneys.
I'd like your comments on this, because it seems to me that one of the areas the Auditor General has been pursuing is CIDA's heretofore reluctance to make specific reports available to Parliament, either through the minister and/or through the committees. This committee has seen you personally and your department before it.
Are you keeping track, Mr. Chairman, of the numbers of times?
I think at one time somebody made a joke that maybe you should become a member of the committee. You're here more often than some of the other people on this committee, except for Monsieur Bergeron. He's here all the time.
Have you worked on this mechanism that makes you more accountable? I'm going to ask the Auditor General the same question. Has there been a substantive change in procedures that gives those of us who are the guardians of the public purse, members of Parliament, a greater comfort level through your reporting mechanism as to where the money is going and how it's allocated?
Is that a short enough question, Mr. Chairman?
The Chairman: May I just add a little something to where it's -
Mr. Volpe: I guess my question was too short.
The Chairman: - being allocated, but also for the future, because the object of this was the future look and how successful it has been.
Ms Labelle: Thank you, Mr. Chairman. On the effectiveness side, what I mentioned earlier was that having a new policy framework and new program priorities...we have defined those and passed them to all staff in the agency. It was the same thing for some of the program priorities, which required additional refinement. We developed additional work defining each of these program priorities - again, wide distribution and discussion within the agency - to ensure that the substance of our work is in keeping with government policy.
.0930
For each country where there is a more substantive program, we develop a country policy program framework in discussions with the country itself and with Canadian stakeholders. We review this within CIDA, with our minister, and it serves as the umbrella to guide the effectiveness of our programming and projects in that country.
Mr. Volpe: Madame Labelle, to be brutal about the question that my colleague opposite was being more diplomatic about, decisions are made on a procedural basis and recommendations come forward on a specific set of criteria, rather than those that might have been a bit more elective in the past. Is that a fair assessment?
Ms Labelle: Absolutely. I'll come to the efficiency in a minute, but on the substance of our work we now have clear program priorities. We have developed a coding system during the course of this year that will allow us to review where our resources have been used, where our actions are, and to determine to what extent they are in keeping with the program priorities that were identified at the beginning.
In terms of the efficiency - how the money is best utilized and whether the maximum amount goes to program delivery - we've done a number of things. In the application of the 1995-96 budget, although this was painful, a number of organizations were cut primarily because they were serving as another level of management. This was to ensure that the overhead was cut in order to allow more to go to countries - we have fewer funds - and right to the delivery point.
Secondly, we developed an accountability framework that is very specific and indicates for each level of staff in the agency who is responsible for what, for ensuring that these policies and priorities are implemented, and for the disbursement. So it was there but not clearly articulated. Now it is clearly articulated.
As the Auditor General recognized, we have spent a lot of energy organizing ourselves to report on results achieved. When we prepare a project, we try to define it in terms of results right at the beginning. This allows us to track the results more readily and ensures that at the end we're able to determine whether something has been achieved or not. In industry and government you plan according to inputs or process. If the input is right, at the end you say you've done your job, but the results are not necessarily so obvious. So this is another part that we have done. According to this, we will be reporting in part III as well.
I could go on, Mr. Chairman, but I don't want to take too much time.
Mr. Volpe: Madame Labelle, I want you to clarify two other things that you've just said. They have to do with perceptions about CIDA, and I think they're perceptions with which you're quite familiar.
You indicated that one of the things you wanted to do in your department was to ensure that the amount of benefit going to the other end would be maximized. I think that's what many of us around the table have talked about over the last two years in terms of both effectiveness and efficiency, especially in view of the fact that the department underwent a 15% cut last year, and you're slated for the same this year and an additional 6% the following year. Do I have the figures right?
.0935
Could you give the committee a sense of how both your new procedures and the new accountability you have in place translates into percentage terms at the other end? I think we were talking about doing more with the same or less money. Are you at the stage in your reporting where you can calculate that if you had $10 initially, you could put $8 at the other end, and now you only have $8 and you can put $7 in the other end?
Ms Labelle: Not at this stage, but we've taken a number of measures that would help us achieve that. This is not something that is easy to calculate, and we hope that as we look at our reporting for next year we will be able to illustrate some of that. We're in the process of putting it into place at this time. Some of it is already in place, but the results are not known yet.
Mr. Volpe: My second question follows up on that. Please tell me if I'm being unfair, because I'm not sure if you can answer this.
In the past this committee has asked whether the amount that goes to Canadian businesses in the delivery of your programs is calculated in your overall budget. You're taking reductions in your budget. What percentage of what you deliver now versus what you delivered before stays at home as opposed to going to the other end?
Ms Labelle: We're able to do both in the sense that we develop programming for providing development assistance in the countries we work in, utilizing Canadian expertise and Canadian goods and services. A large part of what we deliver is done through Canadian expertise, which provides us with a high return on our investment. It means jobs in Canada in manufacturing and goods and services, and it means food that is purchased in Canada. Depending on which programs we have, the return on investment can be $5 to every dollar invested, while in other areas it can be 75¢ to every dollar invested. The important point is that in general our programming is done by utilizing Canadian expertise, but it is to go and deliver the program on the ground.
Mr. Volpe: Maybe I should end with that, because like Mr. Morrison, I'm beginning to feel that I'm hogging the questions. The Canadian public has the perception - I think it can be forgiven for this perception, since the Americans apparently suffer from the same thing - that we take dollars from your budget and we throw it someplace else.
In your re-evaluations, have you broken that down, not so much in percentages but in actual dollars, where you can say out of our budget, this is exactly how many hundreds, thousands or millions of dollars are going outside this country without going through the filter you just described of Canadian expertise, product and services that are then transferred overseas?
.0940
Ms Labelle: Mr. Chairman, we look at each mechanism that we use in CIDA to see how much of it was provided through Canadian expertise or by purchasing Canadian equipment or Canadian food. Except for some of the dollars that we transferred to the world food program, all of our bilateral food is purchased in Canada, as is much of the multilateral food. Whether it is wheat from the prairie provinces, canola, fish or fish products, most of it is purchased in Canada.
On the services side, it is the exception where we don't use Canadian expertise. Other than for work that only makes sense to be done locally, where of course the money is then spent locally, all of the rest is spent using Canadian expertise and services.
As I mentioned before, our assessment in working with Statistics Canada is that overall, not counting indirect return, 75¢ of each dollar we spend is spent using Canadian services and goods.
The Chairman: So when you mentioned percentage earlier on, was it 75% that you gave as the percentage?
Ms Labelle: Of each dollar that we spend, 75¢ is spent on Canadian goods and services. We do not transfer money at this stage. We're not transferring money to governments.
Mr. Volpe: If I wanted to round out my perception about how our aid program works from the figures you just gave me, I'd be thinking in terms of 25% of the budget allocated for overseas development through CIDA, not the full 100%. Is that a fair assessment?
Ms Labelle: Yes.
The Chairman: I don't understand that answer. Why would we only be interested in the 25% that isn't Canadian goods and services?
Mr. Volpe: I'm interested in that, Mr. Chairman. Are you directing that to me or to Ms Labelle?
The Chairman: I'm directing it to Ms Labelle. I understand the answer but I don't understand.... You seemed to be suggesting that the committee would only be interested in the 25%.
Mr. Volpe: No, I wanted to know how much money is actually aid that's going, to useMs Labelle's phrase, to the other end.
The Chairman: Hopefully, Canadian goods and services are going to the bottom end too.
Mr. Volpe: They're provided there, but they're spent here.
Ms Labelle: I think we should clarify this. We're talking about 100% when we're talking about the grants and contributions used to deliver our programs on the ground.
The Chairman: Right.
Ms Labelle: In doing so, we use Canadian expertise, goods and services. Whether it is happening in Bangladesh or Benin, it is using Canadian services to go and do it. Let me give you an example -
.0945
The Chairman: Let me give you an example and you can see whether I'm telling it right, so we all understand.
Assume we're providing a well in sub-Saharan Africa, and it costs $1, what you're telling us is 75¢ is going to be spent buying equipment and providing the engineering services from Canada to get the well to sub-Saharan Africa, and 25¢ will be spent in the country to actually install the well and get it working.
Ms Labelle: As an example, yes, but we might be drilling a well in one part of the country where the simplest, least costly technology is right there. Perhaps we've been able to develop it in another country and are spreading this information to other parts.
The Chairman: Right.
Ms Labelle: On the other hand, you might have a more sophisticated kind of water that you want to give to the communities, which requires greater engineering and requires special equipment that would not be readily available on the ground, and that's when we first look to Canada.
The Chairman: Okay. Is that all right now, Mr. Volpe?
Mr. Volpe: I thought I understood that the first time, but I thank you for looking out for me.
The Chairman: I wasn't really looking out for you; I was just trying to make sure the record was clear.
Mr. Mills (Red Deer): Mr. Chairman, does that mean a Canadian company will do it without any regard for the cost?
Ms Labelle: Absolutely. If we are looking at a situation where we've identified with the country that this is one of their very high needs - a priority - and they want Canada to be there, then the usual approach will be for us to issue a request for proposal and at that time look at best value, expertise and cost.
If we're looking at buying equipment, then it goes through Government Services. Again, a request for proposal is issued and the best price is where we go.
The Chairman: Thank you, Madame Labelle.
Excuse me, Mr. Volpe, for confusing what you had established as a clear point.
Mr. Bergeron is busy so let me quickly ask another question.
Madame Labelle, in the course of our hearings into small and medium-sized business and exports, we heard quite a bit of evidence about the difficulties of operating in certain countries because of the problem of corruption. I wonder if you could help us by telling us, I guess, what percentage of the 25¢ that is spent locally is spent.... I don't wish to be facetious; this is an extraordinarily important issue. We have recognized that there is perhaps a difference between small payments that are sometimes made to customs officers, postal officers, and things like that, to get equipment into a country. We've been told that occurs. We've also been told our businesses sometimes have problems associated with corruption, or with local officials requiring payments.
Is this a question that arises in the delivery of aid as well, and if so, how do you handle it?
Ms Labelle: It is one that we have been very careful about, and that is why, to some extent, we also want to look to Canadian expertise to deliver our programs, because we know that there is a way of working in this country with which we are at ease. The cost is there. We know what the cost is ahead of time. We negotiate every line through an agreement for the delivery of a particular project, and these are audited, as I said before, very closely.
If we were ever to find that moneys had been passed under the table for favours or gaining access to particular sites or the like, we would have to move very rapidly. We would go to the country and either correct the situation or terminate the project. But because of the way we do our contribution agreements and our contracts, we know what the cost is to deliver. We've been around many countries. We've been doing these sorts of things for a long time. We know what the cost is, and people have to report very regularly on expenditures.
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A lump sum isn't given ahead of time; there are disbursement schedules, and the money is disbursed to the extent that we're satisfied with the reporting that has taken place.
The Chairman: Thank you very much. It's helpful.
Mr. Bergeron.
[Translation]
Mr. Bergeron (Verchères): Madame Labelle, thank you once again for being here. One of these days you will have to become an honourary member of the committee. As Mr. Volpe stated earlier, you are here more often than some of our colleagues.
That having been said, I would like to ask you three questions. The first one deals with the statement made in Canada and the World according to which you should be devoting 25% of ODA to basic human needs. According to CIDA's calculations, that you mentioned during your last visit, we have already reached 25% in this area.
However, Mr. Paré quite rightly underlined that the "basic human needs" that have received this percentage don't fit the definition of basic human needs given by the United Nations. Consequently, concerning CIDA's outlook, how are you going to go about ensuring that you will reach 25% of these newly defined basic human needs?
Ms. Labelle: Under the new policy, we have defined each and every priority, but more particularly basic human needs. We checked with the UNDP - that is responsible for defining basic human needs - that our definition fits with its definition, covering namely health, primary education, food, housing, humanitarian aid and emergency humanitarian aid.
We were able to develop a coding system that we will this year be using as a pilot project and for the preparation of our report in Part III of the Main Estimates. We therefore ask that you show indulgence towards us, because this will be our first experience in this area. This will be a guide for us in the years to come. Nevertheless, we already have in place the mechanism that will enable us to do this.
And for now, how do we go about reaching 25%? The policy didn't establish that we had to reach that level this year, but only as quickly as possible. At the end of the current year, we will be better able to establish where we stand as far as that definition is concerned, because it is slightly different from the one we had previously. I don't think we have reached 25% yet, but we hope, within a year or two, to be there or at least to be very close. Obviously, a lot depends on the cuts that we will be faced with and that are an additional burden, but we will be following this matter very closely.
We also carried out another study to determine in which areas of the world these basic human needs are the greatest and where these needs are being served the best. It seems that in Africa we will probably go over 25% next year because it is in that part of the world that basic needs are in the most trouble.
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Mr. Bergeron: According to the policy statement made in Canada and the World, CIDA was to take charge of aid programs in the former Soviet Union, in Central Europe and in Western Europe. However, the aid program had another purpose, that of establishing trade ties and bilateral ties between Canada and theses states.
Once these programs will have been taken over by CIDA, to what extent will these priorities or rather these aims as far as establishing bilateral relations between these new states and Canada are concerned will be maintained? And to what extent will the taking-over of these programs by CIDA respect the aim of devoting 25% of the ODA budget to basic human needs?
Ms. Labelle: We are particularly intent on ensuring that this program remains consistent. We haven't tried to integrate it into any other CIDA programs. Its mission is similar, but it is also different, as you so rightly stated. We are therefore keeping it in-house, because this will enable us to reduce our operating costs. We will ensure that the objectives that have been set for that program are respected.
We also wish to ensure, through this program, that, whenever it is possible, we help countries that have really serious development problems. We know that several countries are truly developing countries. We are striving to combine both aims, to carry out development when it is possible and to respect the goals set at the outset.
But we also want to ensure that this doesn't have a negative impact on the rest of CIDA's programming. Therefore, even though we have this program within CIDA and that thanks to it we have the benefit of economies of scale, we are continuing to protect both aspects of our programs.
Mr. Bergeron: Do you think we will be able to reach 25% of the ODA budget for basic human rights in each and every one of the recipient countries?
Ms. Labelle: Mr. Bergeron, I highly doubt that it will be possible under that program as far as the former Soviet Union and Eastern Europe are concerned. I am also convinced that overall, because of regions such as Africa and countries such as India and Pakistan, we will be able to reach those goals. But it won't be the case in some countries, because they already have what they need to satisfy their needs. This goal will therefore not be reached in each and every country.
Mr. Bergeron: We are aware that NGOs have been subjected to dramatic cuts under CIDA's budget, and the government has been imposing cuts for two years. We know that the pressures that the ODA programs have been put under are largely justified by the fact that Canadian citizens don't always understand the importance of these programs and their direct impact on Canada.
Consequently, it is the general population that is putting pressure on its representatives in order for them to put pressure on the government to reduce its budgets for development assistance and to force CIDA to make cuts. Oddly enough, and contrary to what had been suggested by the special joint committee charged with reviewing Canada's foreign policy, one of the first sectors where cuts were made was that of information to the public, the purpose of which was to justify to the general public the important amounts of money devoted to ODA programs.
What is CIDA's position on this type of paradox where it condemns itself in a way, agreeing with the public's condemnation, because it cut its own public information program, that could have helped to justify the maintenance of its programs and budgets?
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Is there any thought of reintroducing certain envelopes or budgets for organizations that give information to the public on the appropriateness of official development assistance programs?
Ms. Labelle: It is obvious that this is a very difficult issue. The program that was abolished, namely the Public Education Program, was one program that served to inform the Canadian public. We still have another program, this one called public information program. We also have a program that enables us to send to the field volunteers, young university students as well as college students. This program enables Canadians to go and see for themselves what is happening. We really hope we will be able to convince the rest of the population of the importance of being present in the field, of increasing our aid to the poor and, ultimately, of protecting our country for the future.
There is also a third element. Following the cuts, we asked the companies we work with to see how they could further share their experience and information. I am not sure this will produce the results we had hoped for.
I am very pleased, Mr. Chairman, that the committee has decided to study this question in February and to give us the opportunity to participate at that time. It is an issue we have discussed with the associations that work with us in the hopes of finding ways to better reach the Canadian public.
Furthermore, thanks to the small leaflet that we have been sending out monthly for a few months now, we are trying to ensure that you too are better equipped to answer questions from your constituents and to inform them.
It's like a vicious circle. It is obvious that in one area or another, one can never do enough.
[English]
The Chairman: Mr. Lastewka.
Mr. Lastewka (St. Catharines): Thank you, Mr. Chairman. One of my questions was along the same line, concerning the partners and NGOs.
In the Auditor General's report, there was some concern about the accountability of CIDA, and then the accountability of the partners. One of the areas we had discussed before was how, because we cut out the education program - and I have no problem with that - there was some responsibility back for the partners to communicate.
One of my questions is along that same line. I haven't been made aware of how the partners are actually doing that. I think there's room for improvement there. Maybe we're just not getting it from those partners, but I would ask you to look at the item Mr. Bergeron brought forward.
I'd like now to pose my question on the accountability of the partners. I think there was an incident - perhaps in Pakistan, but I'm not sure - where there was some debate as to whether the contracted partner had done their work and whether we were making them accountable. I'd like to hear your comments on the responsibility of CIDA in making contractors accountable.
Ms Labelle: I think ultimately CIDA is responsible for the funds that it receives and that are voted by Parliament. In saying that, I immediately have to say that it is through others that we deliver our program. Therefore, we have to ensure in the way we set up our contribution agreements and our contracts with those who deliver with and for us that we can follow easily their accountability for delivering on our behalf.
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The Auditor General was pointing to the issue of using results-based contracting. We are working on this right now with the associations of consultants, of engineers, and so on, to see how we can better what we are, introducing it, testing it. If we succeed, it would be a way of facilitating or helping us to ensure that those who deliver on our behalf have delivered at the end the product we had agreed to at the beginning.
We've had contracts, of course. They've been done in due form. But as I mentioned earlier, they were more input and process contracts rather than results or stated-in-results terms. Of course, except for equipment, except for delivery of goods, that is clear. But when you're delivering a service, it is much more complicated to be specific.
In certain things it can be. If you say we want to work with such a country to increase the number of children in primary school by x over a two-year period, then you have a result you can keep track of.
On the other hand, if you're working with a country like Pakistan to help them deliver or establish a regulatory framework for environment to prevent massive pollution of their waterways, and so on, and to clean up some of the pollution that's in place, then your definition of what a regulatory framework is, is not as clear as saying there will be so many thousands of children in primary school.
What we are doing is trying to ensure through our contracting procedures, our contracts, and our contribution agreements, that by the statement of work, by the statement of result expected, we can follow much more readily the accountability aspect.
We are not there yet in terms of using a complete results-based contracting. Some of the contractors are nervous because they work in conditions that they're not always masters of, in terms of changing conditions in countries. So they are cautious in working with us on that.
Mr. Lastewka: I want to make sure I understood you when you were having your discussion with Mr. Volpe.
I've always used 63¢ of every dollar that we spend in CIDA as the figure for what comes back in goods and services to Canada. Are you saying that number is now 75¢?
Ms Labelle: We have been working very closely with Statistics Canada. We have simultaneously been reducing our overhead, reducing our administrative costs, and therefore proportionately augmenting what goes directly to development. Our most recent assessment of a few months ago using this is that it is 75¢ direct. We don't try to assess the indirect part. It would be too difficult.
Mr. Lastewka: I have a last question, if I have time. I've had these discussions with people from the Auditor General's office. I have no problem with doing audits on a continuous basis, and so forth, because we always learn from them, and if we make improvements....
My question becomes, within the CIDA organization, have the self-auditing and audit systems been changed to make sure we're not getting into repeats of audit comments? Can you explain that?
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Ms Labelle: Yes. Earlier this year we revised our policy for audit evaluation and monitoring. We have a new one in place. We've indicated to ourselves and have started to implement more collaboration between the audit and the evaluation side so that you can do one piece instead of doing two different pieces one after the other, again to streamline that particular part.
CIDA used to do audits, evaluations, and monitoring of the implementation of its projects, sometimes by third party, and we felt there was overkill when we did that for each project. What we are doing now is developing an audit plan and an evaluation plan, and really ensuring that we do the comprehensive audits and comprehensive evaluations in those sectors that are likely to give us the greatest pay-off or in those sectors where we feel we want to know more or where we haven't done audits and evaluations for a period of time.
I'm not talking here of compliance audits. You do compliance audits throughout everything you do, but we're being much more careful on the extent of comprehensive audits and major evaluations.
Mr. Lastewka: Is the Auditor General's office in partnership with you in establishing this?
Ms Labelle: Yes, we are working very closely with the Office of the Auditor General. They will be able to report on that themselves.
On the results-based management, we have an ongoing committee with them that reviews the work that is being done. I chair the audit and evaluation overall corporate committee of the agency, and we invite to that meeting the Office of the Auditor General to be present as we review where we go and the progress we've made.
Mr. Lastewka: Thank you, Mr. Chairman.
The Chairman: Mr. Morrison.
Mr. Morrison: We've been spending most of our time on contribution agreements, and I guess I'd just ask one short question on that before I get onto the question of contracting. Do you have a feel for what percentage of CIDA's program expenditures is actually done through grants, contributions, and so on, rather than through service contracts?
Ms Labelle: I think we have to look at each mechanism. If we look at the multilateral sector of contributions to UN institutions like UNICEF or the UN refugee organization, we're really talking here of contribution agreements. Therefore, the greater bulk of the multilateral work would be through grants and contribution agreements.
Bilaterally for our geographic programs it will vary between 40% and 60% depending on the program, the priorities of a country, and the partnership in which we are dealing with grants and contributions for that program. So the contracting is primarily on the bilateral programs, the geographic programs.
Mr. Morrison: Would it be fair to say that globally 90% or more of your expenditures would be through grants, contributions, and transfer payments? Would that be a fair estimate?
Ms Labelle: I would like to double check that, Mr. Chairman, and provide the answer to the committee so that I don't provide incorrect information.
Mr. Morrison: Let's shift gears here and talk briefly about contracts. Approximately what percentage of contract documents - I'm talking about contract documents, not dollar values - are awarded or have been awarded in this fiscal year without competition, sole sourced? What percentage are we looking at here?
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Ms Labelle: We will have to look at different levels.
First of all, let me just backtrack here. CIDA, in its current contracting criteria that were approved by Treasury Board in the past, has the authority to contract on a sole-source basis up to $100,000. The reason is that sometimes you need to do this on an emergency basis.
Another aspect is that in our case, because some of the work gets done in another country, the cost of doing the work would be higher than if it were done here, only because people have to travel to another country, as an example.
Now, in terms of the actual practice, contracts below $15,000 are awarded in two different ways. Either they are awarded from standing offers where the standing offer has been made through a competitive process so that up to the level of the standing offer you may be reusing some of the same contractors over a period of time, or they are done in a sole-source way, because the value is so small that it is very costly for firms to make proposals and for us to evaluate them.
As you go higher, the proportions change of those that are awarded on a sole-source basis. For anything over $100,000, it is the exception to have it awarded on a sole-source basis. In these cases it could be, first, because there is one obvious supplier in a very specialized field; second, this is maybe the second phase of a project that has had a very successful first phase and there is a demand by the country to continue the work over a longer period of time; or third, we are dealing again with emergency situations. So these are the kinds of reasons why we would generally find ourselves going to sole source, on an exceptional basis, for contracts over $100,000.
Now, between $15,000 and $50,000 there are great variations again, but what we try to do more and more in CIDA is to use standing offers, that is, go to competition, through the competitive process establish a roster of individuals we can utilize in various sectors in various fields, and then go to that list on either a rotation basis or according to expertise in order to contract.
Mr. Morrison: Rather than ask about percentages, I'll ask about numbers. In the fiscal year to date, how many actual contracts, give or take a few, have been awarded without competition? How many contracts were awarded? How many of them were awarded with no competition?
Ms Labelle: Again, Mr. Chairman, what I would like to do, if we're looking at this fiscal year, is to provide this to the committee to make sure I have the exact information. I think what we will do is provide you with the dollar value as well as the numbers.
Mr. Morrison: All right.
Ms Labelle: In terms of dollar value, over 80% of the dollars spent by CIDA are spent through the competitive process.
When you're looking at the number of contracts, because a very large number are very small, the number is different. We will provide you with that information.
Mr. Morrison: Okay, I'd like that.
I have a couple of questions about means of selection. This would apply to contracts over $100,000. I presume that you make up a short list for the open bidding on these things. To get on to the short list, is price a determining factor, or are other factors used to determine how you get on to this short list? Once a company is on the short list, what entity ultimately decides whether company X is chosen over company Y?
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Ms Labelle: Mr. Chairman, the procedure we have is one that has been approved by Treasury Board. This is the way it works. We introduced the use of the open bidding system a year ago in order to have more access, hopefully, throughout the country, and greater transparency, and so on.
The conditions are set, and we work on a two-phase basis. One is pre-qualification, and then a request for detailed proposals.
As for the first phase, the pre-qualification, on the invitation that is put on the open bidding system, we establish in what way we will select the people who will be screened in. Basically, the qualifications of the staff, experience, and financial capacity are part of these conditions.
A review committee of experts is established. It reviews these proposals as they come in and retains those that meet those qualifications at the highest level. A proposal goes to the minister asking for the selection of up to five on the list of those who have been pre-qualified. As a result of that selection, the firms on the short list are invited to present detailed proposals. Again, the review committee does this and makes a final decision on who has the best overall value in terms of the proposal they've submitted.
Mr. Morrison: I think I follow you here. Does the minister make the ultimate decision on this? Is this a ministerial decision? When you get down to the last one off that list, is it the minister who does that?
Ms Labelle: The procedure approved from Treasury Board is that the selection committee makes the final conclusion on it. It goes to the minister, but the minister receives it as proposed. That's the case up to now.
Mr. Morrison: Does he have to select a proposer from off the list, or can he bring in a completely different company that has never been proposed by anybody?
Ms Labelle: The minister selects the short list from the pre-qualified list that has been put forward to him after a review of the firms that have submitted proposals for pre-qualification.
Mr. Morrison: So there's never been an instance that you're aware of in which the minister has selected a contractor who wasn't on one of those lists?
Ms Labelle: Not to my knowledge. I would certainly want to recheck that, but to my knowledge the procedure has been followed as it has been approved by the minister himself and recommended to the Treasury Board a year ago.
Mr. Morrison: I see we're out of time, but I have to ask one other question.
The Chairman: I thought you said what happened was you put one proposal to the minister. Are you saying you give a short list to the minister of several proposals, and then the minister's office selects out of that short list? Or do you just send one name up, which is either rejected or accepted?
Ms Labelle: There are two phases. The first phase is identifying the list of firms that have answered requests for pre-qualification.
The Chairman: Right.
Ms Labelle: A review committee of technical experts examines all of these proposals. Then, according to the conditions that have been set in the request for pre-qualification, they identify all the firms that passed the test.
The Chairman: Meet the short list.
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Ms Labelle: This list is then presented to the minister, who selects the short list from the list. The minister selects the short list of those who will be invited for pre-qualification for a final proposal. Once we receive the final proposals from the short list selected, the review committee examines those and makes a final recommendation.
The Chairman: As to which one of those -
Ms Labelle: The recommendation is on which one has the best overall value.
The Chairman: Does this go back to the minister for approval?
Ms Labelle: At this time it goes back to the minister primarily for information.
The Chairman: Okay. So then there is no selection process in the minister's office at that level.
Ms Labelle: No.
The Chairman: This seems a little bit different from what I got the first time around,Mr. Morrison.
Mr. Morrison: Yes, it brings something up for me too. I'm getting the feeling the selection is made before the final bid price is written into a proposal. You select the contractor. Then having said you've got the job, you start haggling about the price. Am I getting this wrong?
Ms Labelle: The selection of enterprise is one thing. They are selected on the basis of what they submit. Or they are reviewed and compared on the basis of what they submit in terms of their technical capacity, their methodology or how they're going to do the job, and also their price.
Having made the selection, we sit down with the enterprise and prepare a contract. And yes, it is negotiated at this time. If one can get an even better price, then we try to do this. But the selection has to be made on the basis of what is presented to us.
Mr. Morrison: Does the final document run past the minister actually contain technical detail and price? I'm visualizing the minister poring over these documents on a $101,000 contract. Does price actually show up on the minister's desk?
Ms Labelle: In the pre-qualification, price is not there because this is a very short proposal and people have not had time to do this. Therefore, the selection of the short list from the list presented to the minister is done on the basis of the strengths and weaknesses described in the document going to the minister about each firm. As I mentioned before, when we complete our work and make a final selection, this goes to the minister primarily as information. Up to now the selection process and decisions have been respected.
Mr. Morrison: I have one final question and again I'm going to shift gears on you a little bit. This is on how people are chosen either as recipients of contribution or as contractors. Are contributions or contracts ever awarded to recipient governments or agents of recipient governments? For example, the geological survey of Lower Liechtenstein wants to do a program and they want it to be funded by CIDA. Can this recipient organization or an organization in a recipient country apply to CIDA for a contribution?
Ms Labelle: They can apply. Many of them do. But our general rule is we will work through a Canadian partner who will work with them. There might have been exceptions to this rule, but I'm not aware of any.
Let me give you an example of where we sometimes provide a grant. The Global Coalition for Africa is a group of countries that have come together. They have a very small secretariat and they're trying to look at a number of things such as the major problem of food security for the Horn of Africa, Eritrea in Ethiopia, prevention of conflict.
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A number of donor countries and the World Bank have agreed to each put a little bit of money in to support this effort to support the secretariat. So, in those kinds of situations, we may finish by putting in CIDA's share. For example, it may be $200,000 over 18 months. But we are there. We're able to see what happens with this secretariat and we have decided in advance this is worth the investment.
But it's only in those kinds of situations where we will be providing funds directly rather than through a Canadian enterprise or NGO. In terms of a country, we do it through our Canadian partners.
Mr. Morrison: May I have one final question on the contractors?
The Chairman: Yes, if it is short. We've got two more.
Mr. Morrison: This one is very short. Again, it's getting back to the question of the list of contractors going to the minister. Ms Labelle, you did say the minister cannot choose a contractor who is not on the short list. Can the minister add a name to the short list?
Ms Labelle: Our procedure has been approved by Treasury Board and it is very much the one I mentioned. The list that is prepared after the technical review and then goes to the minister is the one the minister utilizes to prepare the short list. From this, we then invite requests or proposals for details. The addition is not part of the procedure.
Mr. Morrison: But does it ever happen?
Ms Labelle: To my recollection, it has not happened. I'm really trying to think back here.
Mr. Morrison: I think you'd remember if it had, surely. Thank you.
The Chairman: I think that is a fair assumption.
I have two quick questions, Madame Labelle. In this bidding procedure, as you may or may not be aware, under NAFTA, American and Mexican contractors have a right to bid on Canadian contracts. Are the CIDA bidding processes outside of this NAFTA process because it's not done by Public Works or something like that? Is there a reason?
Do you ever see a day where it would be appropriate to have aid projects dealt with so Canadians would bid on American aid projects and Mexican projects and vice versa? Or is this just some sort of pie in the sky type of thing that will never happen?
Ms Labelle: At this stage, Mr. Chairman, ODA is excluded. There are countries outside of even NAFTA, such as Japan. Japan has been increasing its ODA exponentially in the last period of time. They're now at over $11 billion U.S. a year. In yen terms this is even more because of the value of the yen.
Through discussions and negotiations we have had with our Japanese counterpart, they have agreed to consider Canadian enterprises for some of the work they commission. In areas where there is not Japanese capacity, such as wheat, for example, they've agreed to add Canada to the list of countries where our people can bid on their contracts.
It may happen. Certainly when you look at the trend, it may happen. But right now we have no indication that in the foreseeable future it will.
The Chairman: I have a totally different question respecting aid to the former Soviet Union. My understanding is that of the $105 million, which I recall from the supplementary estimates is presently designated there, a great deal of aid is actually in the form of consulting with local organizations about democratic governance and issues like this, particularly in Russia, where a lot of the aid is not delivery of wells or roads but is very much this sort of soft infrastructure, such as democratic development and issues of that kind.
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If you have any handle on it, maybe you could tell us what proportion of the $105 million is actually of that type of aid.
Secondly, in your view, are the upcoming Russian elections going to impact on that type of aid and maybe end up making it less welcome in the eyes of the Russians themselves, if there's a change in government there? In that case, what will the impact of that be on our total aid package to the former Soviet Union countries? Will we see that $105 million cut down substantially or affected?
You can see where I'm trying to get. Look into the future with us and tell us where we're going on that.
Ms Labelle: The major areas for the FSU and Eastern Europe have been food, energy, physical infrastructure, land regime and of course democracy and good governance.
Democracy and good governance are high in terms of number of interventions. A lot of requests have been made. But in terms of disbursements, it's not so high, because a lot of it individually does not cost very much. It is really identifying a Canadian institution to work with one of theirs in trying to support them or with a local government or a state government. It is important and we do a lot of it, but in terms of dollars, it's not as high as energy, for example.
The whole nuclear safety area is one on which we have been working very closely with the Ukraine and Russia, because the safety of all of us is at stake as well as the health and safety of the people of those countries.
The Chairman: Could you tell us how much we spend in the former Soviet Union specifically on nuclear safety-related matters, advice and so on?
Ms Labelle: I would have to come back to you, Mr. Chairman, to be precise, because it is divided into a number of countries. I think this would be important information.
The Chairman: Yes, it would be. If you could even just give us that breakdown you mentioned before - infrastructure, energy, wheat or food, land reform and democratic development - that would be very helpful for us. I think other members of the committee would appreciate that.
Ms Labelle: One of the things we are doing, both in the former Soviet Union and in a number of CIDA programs, is trying to stretch our dollars. It's even more applicable to the former Soviet Union and CEEC.
We're trying to stretch our dollars by expecting the Canadian institution that works with us and the country at the other end to put some resources in. Very often we find ourselves each contributing a third of what is needed to do the work. To me that's fine. That's good, because it allows us to help and to stretch our dollars quite a bit more.
Energy is one of the examples where we do a lot of that.
The Chairman: Going back to my question about Russian politics - and I'm not asking you to be an expert on that - as a cautious and prudent administrator, you'd no doubt be considering future expenditures. Do you see an impact on your expenditures as a result of the election, depending on which way it might go, or will it be business as usual?
For example, the newspapers are presently telling us the reform element in Russia might be seriously cut down by resurgence of the older members of the previous regime. If that happened, would it affect their aid prospects or what we're doing there, or would we just keep on going the way we are?
Ms Labelle: At this time, because our assistance has been very much working with either institutions of the government, parastatal agencies and municipalities, or with enterprises, through joint ventures, to help them build their private sector, it would take a fair shock as a result of that election to make us reassess completely what we're doing.
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Second, we are also, in that part of the world, making commitments that are on a much shorter-term basis and then adding, if everything works well. So we are prudent, therefore, in how we plan our work, yet we leave ourselves the scope to continue for the longer term, if everything works well. I think we are protected whatever happens in terms of future investment.
The Chairman: Thank you very much.
Once again, on behalf of the members of the committee, thank you very much, Madame Labelle and Mr. Robinson, for coming. I understand you'll be staying, Mr. Robinson, for when the Auditor General's representatives can join us. I believe they are here now.
We'll take a two-minute break and then we'll move on.
Thank you very much, once again, Madame Labelle.
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The Chairman: Mr. Fadden, thank you very much for joining us, and Mr. Sahgal, it's good to see you again. I think you had an opening statement, Mr. Fadden, and then we'll open it up for questions.
Mr. Richard Fadden (Assistant Auditor General, Office of the Auditor General of Canada): If I may, Mr. Chairman, thank you. It's a pleasure again to appear before the committee. We last appeared before this committee in May. At that time we outlined our audit plans for both Foreign Affairs and CIDA.
In the case of CIDA, we had pointed out that our efforts will continue to be directed towards encouraging the agency to focus on our long-standing concern; these are results management and reporting, and ensuring that ODA moneys are spent exclusively on purposes intended by Parliament.
We had also stated that we intend to follow through on the progress CIDA is making in addressing our concerns, by examining the implementation of its plan for renewal. In this regard, in October of this year we published the results of the first phase of our follow-up for the 1993 report on the bilateral program, which is the object of your hearing today.
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The committee may recollect that a three-phase approach for follow-up was agreed upon with the agency as a pragmatic way to assess and encourage CIDA's progress. This approach is rather innovative in that, in the first instance, CIDA is expected to report to Parliament, in its own words, how well it is doing to resolve the issues it acknowledged as critical to its management effectiveness.
The approach adopted for monitoring CIDA's progress recognizes that the agency has set for itself a benchmark against which it can be judged by Parliament. In this regard, any feedback from the committee on the new approach is certainly of interest to us, as well, I suspect, as it would be to the agency.
[Translation]
Our 1995 report brings to the attention of the House the results of a self-assessment CIDA has conducted on its progress, mainly at headquarters, in Hull. As well, we have provided our comments on CIDA's self-assessment as they pertain to the extent to which our previously reported concerns are being addressed by the Agency. For instance, while we commend the Agency for having taken the first steps towards renewal, we have strongly encouraged the Agency to take the necessary next steps - start implementing the changes it has proposed at headquarters by focussing its management efforts henceforth to the field level where the benefits of development are to be derived and the value for money questions ultimately answered.
The report also outlines for Parliament the scope of our future follow-up work at the Agency; in the second phase, the emphasis will be on monitoring CIDA's progress at the field level where the results of development expenditures can be witnessed. The sustainability of many of CIDA's projects was raised as a major concern in our 1993 report. We remain concerned. The issue of performance measurement and reporting on the results of CIDA's projects and programs on the ground will likely be a central theme of our 1996 report. Having said this, I would want to be very clear that our 1996 report will, very hopefully, be built upon a collaborative audit effort with the Agency. Our goal will be to assess, through the review of pilots, the progress made in beginning the implementation of its results-based management concept in the field.
Mr. Chairman, there is one concern raised by the Auditor General in his 1995 report that we believe warrants special attention at this time. We noticed a call for greater transparency. As you are aware, the government has recently acknowledged that, and I quote:
- Canadians want to be sure that their aid dollars are being used effectively, that their help is
making a difference in the lives of people benefitting from Canadian assistance by increasing
their self-reliance.
[English]
Our main concern at this time is that further delay in measuring and reporting on results could well adversely impact on CIDA's credibility. The agency has committed to the development of a performance measurement model as part of phase one of our follow-up. An objective here was to use CIDA's model during phase two of our follow-up work. Unfortunately, the agency has not yet been able to accomplish what it had intended to do.
Mr. Chairman, we believe CIDA needs an overall tracking and reporting system to assess the quality and status of its projects. We would urge the agency to give a fair measure of priority to the development of this system, which should, we believe, be fed both by field staff and by input from visiting headquarters staff.
[Translation]
In closing, Mr. Chairman, we would welcome the committee's comments on the audit work we are doing at the Agency and we look forward to answering your questions.
[English]
Thank you, Mr. Chairman.
The Chairman: Thank you, sir. Mr. Leblanc.
[Translation]
Mr. Leblanc (Longueuil): You state in point 8:
- further delay in measuring and reporting on the results could well adversely impact on CIDA's
credibility.
- I would like you to elaborate on that if you would.
That is what we wanted to stress here. In order to report on results, there must be indicators and methods that can be used to measure them.
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Failing that, Parliament could very well judge the Agency much more severely and CIDA would then have to make even more efforts to obtain the funds it wishes to have.
It is a very general comment. We believe that the Agency should report as quickly as possible on concrete results. If it doesn't do so, its general credibility will be at risk.
Mr. Leblanc: That is a rather severe warning. You say that it's a general observation, but it is quite severe. You're stating that it could have an adverse impact on its credibility. That is quite serious.
Mr. Fadden: That is true, Mr. Chairman, but this is an observation that is based on three or four years of audits within CIDA. I must say that we believe that CIDA is in general agreement with this observation. When we prepared our report in 1993, we discussed all of these things. It was indeed recognized that the Agency would have serious problems if it was unable to show that various indicators were used and that certain results had been obtained.
I do agree with you that this remark is a serious one.
[English]
The Chairman: Mr. Morrison.
Mr. Morrison: Thank you, Mr. Chairman and Mr. Fadden. One branch of the bureaucracy I'm always glad to see is the Auditor General's.
I would like to get into some specifics right away. I'm much more concerned about contribution agreements than I am about contracts, simply because of the sheer size of the amount of money involved. I don't know whether this question should be to you or perhaps to Mr. Robinson, but I would like to know what regulations and procedures are in place to restrict or guide the organizations that receive CIDA funds in the contribution agreement form. In other words, how do we winnow these people? How do we select them?
Mr. Fadden: I think, Mr. Chairman, it would probably be better if Mr. Robinson took a stab at this, because we have not audited this question in particular.
The Chairman: Yes, by all means. Mr. Robinson.
Mr. John Robinson (Vice-President, Policy Branch, Canadian International Development Agency): As the president said earlier on in her remarks, Mr. Chairman, there are a number of ways in which we provide contributions.
We provide contributions to a wide range of multilateral organizations. We sit on their boards of directors and we are present in their governing bodies to verify the programs they have. Of course we don't do it solely; there are many other countries in those institutions as well.
With respect to Canadian organizations to whom we provide contributions, we do have within the agency quite a rigorous process for verifying, as the president again said earlier on, the financial viability of organizations that are getting contributions. We do not provide grants or contributions to these organizations without doing a thorough examination of the proposals they make to the agency for funding, and it's on the basis of analysis of both the funding proposals and the viability, financial and otherwise, of the organizations that we determine whether or not to make contributions to them.
Mr. Morrison: With that lead-in, I can then go back to you, Mr. Fadden, and ask what you would specifically like to see with respect to mechanisms for the selection of candidates for grants and contributions. What conditions would you like to see attached to them, and what enforceable responsibilities would you like the recipient organizations to have?
Mr. Fadden: That's a very difficult question, Mr. Chairman. I think the broad approach of the Auditor General is to argue that in these instances it is the light of day that will do the most bit of good. In other words, there must be greater transparency in determining the conditions under which these contributions are made. There must be greater transparency in deciding whether they're doing the work required and in evaluating them.
It's very difficult for us from the outside to set up a series of detailed conditions that would apply to the vast array of contributions that CIDA makes. So not having audited them to date, except for contributions of counterpart funds, which we mentioned in our 1993 report, we think the first thing CIDA should do is to put a little bit of light of day on the whole issue.
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In terms of what we would like to see on the other side in terms of what these agencies do with the money we give them, we're faced in some instances with real impediments. For example, say CIDA gives a fair bit of money to one of the regional development banks. They're essentially an international organization, and there are limits in terms of what Canada can do in terms of ensuring their use.
I think over the course of the last several years - we reported this in 1992 - real progress has been made in trying to get these agencies themselves to better evaluate the work they have been doing. But I think it would be unfair for us to suggest that in every single instance the agency is in a position to monitor in detail and immediately cancel contributions. We think that, wherever possible, conditions of audit and review should be written into the contribution agreements. When this is not possible, we would urge the agency to collaborate with other national aid agencies to obtain the right to do that.
Mr. Morrison: With respect to the IFI contributions you mentioned and your limited powers to audit them, would you have the means to determine...? Say, for example, funds were allocated to an IFI for a specific project or recipient. Funds were then not drawn down but were left essentially parked in the IFI and were then drawn back or into by CIDA. Would you have any means of keeping track of that?
Mr. Fadden: Could I ask Mr. Sahgal to answer that, Mr. Chairman?
Mr. Vinod Sahgal (Principal, Foreign Affairs, Office of the Auditor General of Canada): Mr. Chairman, Canada, at each of these development banks, has an executive director. One of the responsibilities of the executive director is in fact to monitor the loans portfolio from two perspectives, which is, first, from a credit perspective, and second, from a development impact perspective.
In that sense, my understanding is that the regional development banks are in the process of developing a tracking system on every project and loan that's given out to assess the potential for results, the sustainability of the project, and whether the moneys have been spent for purposes intended.
Thank you, Mr. Chairman.
Mr. Morrison: I guess the question of contribution agreements is so broad and perhaps nebulous that we can't dwell too long on it here. I'd like to ask about things that auditors can more likely get their teeth into, which, of course, means the contracts.
Do you have any concerns, as an organization, with the way service contracts are awarded at CIDA? Are there any concerns, for example, about conflict of interest and that sort of thing?
Mr. Fadden: Mr. Chairman, I'd like to answer that in two parts. First, as for the particular component of your question that deals with conflict of interest and what not, we have not audited. So I really don't think I can comment. More generally, we did refer a little bit in our chapter in 1993 to the question of adapting contracting practices to the new results-based management style that we were advocating.
The agency agreed with this at the time that, as part of their management renewal process, they would have to bring along their contractees as well as their own staff. One of the things we are going to be looking at in the follow-ups overall is the extent to which this has happened and is happening.
We do believe, again - I hope you'll forgive me for repeating, but it is a constant theme of my boss - that in this area, perhaps more than in some others, there is a need for greater transparency. As for the kind of concerns that you've raised about conflict of interest, whether they are there or not, many people suspect they are there. So we believe that, to the greatest extent possible, the contracting process at CIDA should be made more transparent.
Mr. Morrison: Do you think, from what you've seen of it and from the work you've done so far, that this open bidding system has been a success? If you think it is working the way it was intended to, do you think the floor should be lowered? It's now $100,000. Should it be down to say $50,000 in order to make everybody more accountable? Or would this bring too many complications into the system?
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Mr. Fadden: I don't think we've audited that particular aspect in any great detail, if we have at all.
In terms of the ceiling or the threshold, the Auditor General is relatively firm in the view that accountability can be obtained from a variety of levels within any governmental agency, so it doesn't matter whether the threshold is very high or very low. Whatever that threshold is, there is still a series of rules against the threshold, above or beyond, and the people who are charged with administering it can be held accountable.
We do not believe that in this instance, any more than any other, the threshold should really be put too low, because it does add costs, beyond a certain point, that are out of balance with what is obtained. It's an inadequate answer, and I apologize, Mr. Chairman, but we simply haven't audited that.
Mr. Morrison: How do you feel about sole-source biding as a general rule? You have to balance efficiency on one side with the openness for people doing funny things on the other. How do you feel about sole-source bidding as a matter of principle?
Mr. Fadden: As a matter of principle, accepting that there will be exceptions, we believe that sole-sourcing is not a good thing. We've commented on this in the context of an audit of Public Works and Government Services Canada a couple of years ago. Our first, strong belief is that, whatever the rules are, they should be obeyed. One of the things we discovered a few years ago when we did that audit is that, in that first instance, the rules are not always obeyed.
We think the rules, which are publicly known, should be obeyed. Second, as a matter of principle, again accepting that there are exceptions, we would favour open-source bidding.
Mr. Morrison: Something has been suggested, but I don't know whether it has any veracity or not. This is something that I sure wish we could find through the Auditor General at some point. It's that the great majority of CIDA contracts are actually sole-sourced and that open bidding is in a minority position. More are sole-sourced by actual contract documents, not by dollars.
I hope, as the Auditor General's work progresses, that this particular question will be examined. If it's true, I don't think it's right; if it's not true, then CIDA should have its image burnished a little bit by showing that it isn't true.
Mr. Fadden: We'll relay your suggestion to the Auditor General.
Mr. Morrison: Thank you.
The Chairman: Thank you.
Mr. Flis.
Mr. Flis (Parkdale - High Park): Thank you, Mr. Chairman.
In reading chapter 13 in your October report to the House of Commons, I noticed on page 13-35 that you were concerned that CIDA had not fully acknowledged its accountability to Parliament for managing in a way that would produce desired results. Then on page 13-40 you went to say:
- CIDA is improving its reports to Parliament to increase their focus on objectives and
achievement of results.
This morning you mentioned in item 6 that the second phase should be an emphasis on CIDA evaluating out in the field. The sustainability of many CIDA projects was raised as a major concern in your 1993 report, and you still remain concerned on that area. When you made that recommendation to CIDA, did you suggest any criteria that CIDA could use to better evaluate their results?
You also talk about evaluating projects based on the ground results, a results-based management concept, in the field. In order to audit the project on the ground, in the field, etc., will this not mean more Auditor General workers going out into the field to audit? What cost will that be? What does it cost the Auditor General and the taxpayers to audit just CIDA itself?
Mr. Fadden: Mr. Chairman, I don't know the answer to that question, but I'd be more than happy to find out and let you know.
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One of the difficulties of operating outside of continental North America effectively is that costs go up almost geometrically. In those parts of the world in which CIDA is asked to operate - it's one of the things we tried very hard to note in our 1993 report - life there is not easy. Something that can sometimes be done here by a telephone call might take two weeks of activity. The same is true of our audit work and of the audit work being carried out internally by CIDA.
We believe that the approach being taken by CIDA in broad terms is entirely reasonable. They wanted to start the change process at headquarters and move along so that eventually all of their work in the field would reflect those changes in principle at headquarters.
We're hoping in 1996 to do an effort jointly with CIDA. One of the reasons, quite honestly, that we want to do this is to save some money. We'd like to pick a number of projects with CIDA in which we'd like to have joint teams going out with a couple of their internal auditors or evaluators and a couple of our auditors. They would go out to have a look at what these pilots are showing.
Next year, when we come to the 1997 report, we will go back to a more traditional mode in which, I will admit to you quite up front, our costs will go up. It's simply more expensive.
In terms of whether or not we elaborated criteria, we did do that in our 1993 report in summary form. I think it's probably fair to say that there was a measure of disagreement between ourselves and CIDA on those criteria. It's probably equally true to say that there's not a broad consensus internationally on what those criteria can be.
To take a simple example, in dealing with the construction of a school you can decide whether or not CIDA and Canada should declare a major victory once the school is built. Or you can decide that this is just a concrete output that really accomplishes nothing. Ten years later, you'll have to decide whether the educational system in that country has markedly or noticeably improved.
I think what we're trying to move toward, in both our thinking and that of CIDA and other international agencies - I believe we're operating in parallel with them - is to admit that both have to be measured, but they have to be measured in different timeframes.
If you'd like us to try to recapitulate the criteria that we set out in 1993, I think probablyMr. Sahgal could do that better than I. But we still believe there's a lot of validity to those criteria. Having said that, Mr. Sahgal and I and Ms Roberts met not too long ago and said point blank that there is nothing sacred about these criteria. They're the reflection of our work and our thinking on this. We're perfectly happy to change them if the final outcome of all of this will mean criteria that everybody agrees are reasonable to be utilized to measure the results of the projects.
Mr. Flis: Could we have a review of those criteria?
Mr. Sahgal: Mr. Chairman, there were three broad criteria that were used by the Auditor General in our 1993 work.
The first was the potential for meeting the project's objectives. I emphasize the word ``potential'' on the grounds that, at any one time, the best indicator a manager has is to review how well he or she is doing toward meeting what the project's objectives are. In that sense, ongoing monitoring can take place based on how nicely the project may be moving toward its objectives. So that's the first criterion.
The second criterion we looked at was the potential for sustainability of the project's intended benefits after CIDA withdraws. Very frequently, Mr. Chairman, the success of many development projects depends on the host country's institutions. It depends on the host country's commitment to providing the recurring cost that would assist the future benefits to be realized.
I think it's extremely important in that sense for the donor countries to monitor the potential for sustainability of those benefits after their project is completed. In other words, their inputs are being provided and the immediate output is on the floor.
We viewed the third important criterion as the importance of learning. In other words, we recognize that not everything is in the donor's control. Therefore, it's extremely important that lessons learned are monitored and actions are taken on a timely basis to take corrective action.
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The argument the Auditor General put forward is that if lessons are being learned and timely action is taking place, course corrections are taking place, and if in certain instances the projects are cancelled, then that is good management.
Mr. Chairman, there were three broad criteria. The first was potential for meeting project objectives, the second was the sustainability of the project's intended benefits, and the third was timely action based on lessons learned during the course of project implementation.
Mr. Flis: I visited two health clinics in Haiti recently. One was completed and functioning. A line-up of thirty people were already using the health clinic and its services. I visited a second one, which should have been completed also but wasn't; it was half completed. That community had a mud flood four feet deep. The best things CIDA could have given were wheelbarrows and spades, which it did, to clean up the community. That will delay meeting their objectives by maybe a full year.
So you people can come in after it's all cleaned up, etc., and say you didn't meet your objectives; it took you a year longer; it took you that much more money, etc. I hope there's a sense of reasonableness and everything else. You're not auditing whether a bank has met its objectives. Again, we're trying to get assistance to the most needy. So I have a little concern there.
Mr. Fadden: Mr. Chairman, we agree with this. In fact, I would just repeat the funny little example I tried to give the committee last time about your committee travelling to Zaire to hold a hearing in the middle of the virus problem and holding your clerk accountable for the arrangements over there. We think that's impossible. You can't do it without taking into account -
The Chairman: You haven't met Mrs. Hilchie.
Mr. Fadden: What I meant to say is you cannot hold her accountable for holding a hearing exactly like this one in Zaire. We tried as well as we could, and I think we had a measure of agreement with the agency in our 1993 report to acknowledge the very points you're making.
What the Auditor General is concerned about is projects going on automatic. We entirely agree with you that when circumstances change they should take it off automatic and do what you suggest, as an example. I know that on this point the Auditor General personally would agree with what you've said.
Mr. Flis: Thank you.
The Chairman: I would like to follow up on the point that both Mr. Flis and Mr. Leblanc were driving at, because it seems to me you have a very difficult job as auditor because much of what you're seeking to audit is extraordinarily subjective and difficult to evaluate, much as the projects are difficult.
When you say that CIDA in order to have credibility must have transparency, obviously your role becomes very difficult, because if you criticize CIDA unfairly, then you're making it impossible for us to deliver an aid program. There's a really curious relationship here that is, I'm sure, not exclusively related to CIDA. How do you see that?
Listening to you, I'm quite concerned about the Auditor General's role. Really, as you said, we build the school and now you're going to say CIDA's either performed or not performed its task...whether twenty years from now we have graduate students wandering around in that country who are properly educated...wow! The Auditor General's department is going to be bigger than every other department of the Government of Canada if this is what your role is.
How do we get a handle on this? I hear your three criteria and I think they're very good, but how do we get good information from you in this area when it's so subjective and so difficult to evaluate?
Mr. Fadden: Mr. Chairman, you set out a dilemma that is real. It's something that we talk about internally on occasion in regard to a number of programs. There's a balance to be had.
In the particular case of CIDA, in preparing for the 1993 report we got into - I hope there are no former Jesuits here - what I thought were real Jesuitical arguments about what we were arguing and what we should call it. When we started off the process we were auditing CIDA's results. We wanted to go and look at the little health clinic, or the school, or things of this nature, and by the time we issued our report to Parliament we were talking about holding CIDA accountable for its management's full results.
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In other words, we're perfectly willing to accept that in a number of circumstances the objectives of which you spoke will not be met. But what we do believe CIDA can and must be held accountable for are the systems, the practices and the analysis that they bring to bear to get them to deliver the dollar in the field. So as we said in our 1993 report, we think that the kind of analysis they bring to bear on the risk that each project will undergo has to be improved. We believe, and the agency, I think, agreed with us, that there had to be more attention on what did come out at the end and not so much about what goes in.
There's a lot of pressure in government for disbursement. You have the money; you have to get it out. This is not unique to CIDA, and we understand this. What we're trying to do to deal with some of the dilemmas you've set out is say, what we want to do is look at the entire system that is put in place in managing towards those results. If those results aren't obtained for a good and valid reason, that's fine. But did CIDA, when it discovered the sort of thing Mr. Flis encountered, stop building the health clinic in the middle of a flood, or did the local contractee from a Canadian executing agent simply say, my God, if I don't spend the money they won't give me the money next year? Did CIDA have a system in place - it's a simple example and I know it - that will encourage people to take those kinds of decisions?
While Madame Labelle was speaking, someone asked her a question about the political situation in Russia, I think it was. We have no quarrel with her answer whatsoever, but what we do have a quarrel with is when a country's falling apart and nobody at headquarters and in the field applies their mind systematically to reviewing whether or not something is to be done.
I'm not suggesting now, nor do I think we ever have, that the situation is black and white. We're talking about a measure of degree here. We think CIDA should move its management practices in that direction.
It's perhaps not an ideal way of dealing with the dilemma you set out, but at least it's our attempt to try to deal with some of the problems you've articulated.
The Chairman: I understand that U.S. aid, for example, focuses a great deal on this sustainability issue, which you, I think, rightly do with CIDA. Are you comfortable that CIDA is focusing on this track and that we are going to see a better understanding as to the sustainability of the projects that are undertaken?
Mr. Fadden: That's a difficult question to answer. I think that is in fact one of the goals of phase two and phase three. We've had ongoing discussions with our colleagues in CIDA for a number of months now, and I don't think there's any disagreement - I should let Ms Roberts and Mr. Robinson speak for themselves - that sustainability is important; otherwise we would be pouring money down a black hole. But I think, again, the issue we're hoping will be pursued with as much vigour as possible is how do we systematize that kind of concern. How do we develop indicia to enable both field and headquarters staff to know when it's time to make changes to take these sorts of things into account?
Having said that, one can approve a project in 1993, when all of the sustainability indicators are perfect, and three years later there's a revolution in the country and they become zero. There again our reaction is, that's fine, that's the way the world operates. But CIDA must have in its tools the capacity to monitor this and to react in a way that will protect the interests of the taxpayer.
The Chairman: Thank you. It's very helpful.
I have a last question, and then Mr. Volpe.
You spoke to Mr. Morrison about the international agencies and contributions. Does each one of those agencies we make contributions to have their own auditor general? I know the UN has just put in an auditor general function, but I presume the World Bank, the Inter-American Development Bank, and the African Development Bank all have auditors.
Mr. Fadden: I think they all have auditors. Whether they're called auditors general or not, I don't know.
The Chairman: Yes, but they have someone performing your function.
Mr. Fadden: I think they're more or less effective, depending upon the particular institutions. Some are becoming rather more so; others are not.
The Chairman: Yes.
Mr. Fadden: But they do exist in just about every public institution to which we give money.
The Chairman: The one that I think would concern the members of this committee the most would be the African Development Bank, because that's the one we've perhaps heard the most criticism about.
Do you have any particular comment about it? It seems to be undergoing a real credibility problem.
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Mr. Fadden: Mr. Sahgal tells me that at the time of our audit they did not have a stand-alone constituted internal audit function; I overheard Ms Roberts saying that they now do.
Ms Claudia Roberts (Acting Vice-President, Corporate Management Branch, Canadian International Development Agency): I'm not sure if it's an internal audit group, but it's definitely an auditor group. They have auditors, definitely, and did have in 1993.
Mr. Fadden: Mr. Chairman, could Mr. Sahgal just comment? He was recently visiting the World Bank on something that may be be of interest to the committee.
Mr. Sahgal: Mr. Chairman, I was in Washington last week and I was assessing the very question you have raised; that is, what kind of internal auditing procedures are being strengthened in each of the multilateral institutions? I'm very pleased to note that both in the case of the Inter-American Development Bank as well as the World Bank, there is a very strong emphasis on strengthening internal oversight procedures so that projects and programs of the banks are monitored on an ongoing basis.
The Chairman: Are they using similar criteria to those that you speak of in terms of evaluation such as sustainability? You mentioned project objective sustainabilities and the ability to learn. Would they be using similar...?
Mr. Sahgal: I'll give you the example of the Inter-American Development Bank. It has an annual report that goes to each of the executive directors, which outlines the performance of their portfolio of projects. This gives a clear reading to the board as to how many projects are moving along nicely; how many projects may be in some form of difficulty; how many projects are in extreme difficulty; and in the latter two, what actions are being proposed by management to correct the deficiencies.
The Chairman: Thank you very much.
Mr. Volpe.
Mr. Volpe: Thank you, Mr. Chairman.
I wonder if I can refer you back to page 2, item number 5, where you said, ``we have strongly encouraged the agency to take the necessary next steps'', and so on. You didn't give us an indication as to why you noticed a reluctance.
Mr. Fadden: Mr. Chairman, this is rather subjective, as you can appreciate. In our dealings over the course of the last two or three years with CIDA, I think it's fair to say that most of what we've been trying to accomplish has been supported by the president, who was here with you earlier today, and there's a broad measure of support within the agency.
Having said that, I don't think I would be telling you anything new when I say that in any institution of any size, unanimity on this sort of thing is difficult to obtain. I can remember being told at one point by some of the people I was working with on the CIDA audit that at that point in time about half of the CIDA executive committee was entirely behind this. Of the remainder, some were pretty sure it made sense, while others had their doubts.
As I suspect is true in this place, as everywhere else, where you sit sometimes explains where you stand. If you're in corporate management or in policy or if you're working directly for the president, all of this vast array of change may look somewhat different if you're out there just trying desperately to get aid projects in the field.
What we're really trying to do in the course of these next six to eight months is in fact identify the extent to which there is reluctance or not and the extent to which in fact the progress that has been made at headquarters has been reflected in the field.
I don't know if I would say there is ``institutional reluctance'', because I don't think there is, but I do believe there are pockets in the agency that are less supportive of these changes than others, and we hope to find out in some detail over the course of the next few months where these are.
Mr. Volpe: In your presentation, and of course in your report, you use the word ``transparency'' often enough for people like me to think that that really hides another problem. I think my colleague opposite, Mr. Morrison, in asking you a question, caused the words ``conflict of interest'' to come forward.
Is that in fact a concern, or are we generating that concern by using words like ``transparency'', or lack thereof, and perhaps focusing on a response like the one you gave me about perhaps not total acceptance of the need to change from within the agency itself.
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Mr. Fadden: Mr. Chairman, from the perspective of the Auditor General, we're calling for greater transparency because we believe that makes for good governance, period. It is something that the current Auditor General firmly believes. He believes that when administrators - be they in CIDA or the Auditor General's office or anywhere else - know that their activities can be subject to either public or media or parliamentary review, it focuses the mind. So from our perspective we really do believe that transparency provides for good governance.
Having said that, we would want to emphasize that when we talk about transparency we do not mean that every time, for example, Mr. Robinson orders his subscription to The Globe and Mail, it should be brought to the attention of this committee. There are thresholds and there are levels.
Do we imply by this that there are necessarily problems relating to conflict or what not? No, we do not. A lot of other people do, but we're not doing that. I want to be very clear on that. We haven't audited, as I tried to say to Mr. Morrison, the question of conflict in CIDA, and we have no reason to believe that there's any more or any less there than there might be anywhere else.
Mr. Volpe: So what inference might committee members draw from your reaction to the response given by Mr. Robinson, and of Madame Labelle's to Mr. Morrison's question, respecting how the decisions are made regarding contracts?
Mr. Fadden: I don't think I heard Madame Labelle, so I apologize.
Mr. Volpe: Let's just focus on Mr. Robinson's, then. In your mind, from an auditor's point of view, is it sufficiently transparent and free from interference, from a procedural point of view?
Mr. Fadden: I'm not trying to avoid answering the question; I'm just thinking about it, because, as I'm sure you know, it's a very sensitive question.
Mr. Volpe: Yes, but we've used sensitive words here and nobody's addressed them.
Mr. Fadden: No, no, I understand; that's fair.
First I'd like to say - and it's the perfect auditor's defence - that we haven't audited this; we really haven't. We are charged with maintaining a general overview of the agency, and I'm going to respond on that basis.
Do we think that across the board - not having audited them - all the procedures that are in place are picture perfect? No, I don't think we would say that.
One of the difficulties in this town - as I'm sure you know, as well as perhaps I believe I know - is to track decisions from the very beginning to the very end, in an administrative sense. It's simply difficult to do, because there are players from the bureaucratic and the political world that interact.
I'd like to emphasize, from the Auditor General's perspective, that there's nothing inherently wrong with Mr. Robinson's political masters playing a role in this. That's why we have a democracy. One of the things we're often accused of in the Auditor General's office is of believing that administrative decisions are to take place in watertight compartments, and political input or political - I don't want to use the word ``influence'' because it has a negative connotation, but there's a legitimate role for political decision-making in all of this.
Mr. Volpe: That's how we establish accountability.
Mr. Fadden: Yes, exactly, and we don't think that part is necessarily as transparent as it might be.
Mr. Volpe: I guess from a committee member's point of view, the concern about the role of the Auditor General would focus itself in two large areas. One is in the granting of the contracts, and the other would be in the evaluation of any of the projects that are inherent.
You've just given me an indication of what you think might be some of the drawbacks to getting a completely airtight audit of the granting of contract system, although I don't think you said there's anything untoward at this stage of the game - correct me if I'm making an error in the inferences here - but you're largely satisfied with the procedures outlined by Mr. Robinson.
The second one is the evaluation of the projects themselves. Do I understand you correctly to have said that you haven't yet identified the vocabulary you agree on when you're going to give an evaluation of a project, both from a pre-assessment point of view and from a final judgment point of view?
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Mr. Fadden: Essentially, that's correct, although we're moving toward that point fairly quickly. We tried to set out our broad approach in our 1993 report, and we still think there's a lot of validity in it. I don't know if my colleagues share that view or not, but we're having ongoing discussions. We're meeting with CIDA next week to try to plan for phase two, and one of the preconditions to doing phase two effectively is the sort of thing you're talking about.
Otherwise, we're back to the situation where we'll elaborate our criteria and go and audit them, and then the agency will disagree. I don't think this committee or your colleagues in Parliament will be particularly well served, because we'll be at each other's throats in trying to set out what we think is good, bad or ugly. But right now we do not have a consensus on the kind of criteria we would apply in phases two and three.
Mr. Volpe: Has the Auditor General's department thought in terms of something you referred to a moment ago on another question - the democratic or political assessment or consideration in drawing up a series of items that ought to be evaluated? I guess we'd call that public policy, but you wanted to use other words. Is there a public policy evaluation component in your auditing?
Mr. Fadden: We haven't elaborated on it in detail, but we admit that it's there and we believe it's appropriate. In its contribution to this year's chapter, CIDA made the point quite clearly that the government has made a number of public policy decisions that impact directly on what they're going to do and how they're going to do it, and we think that's fair game.
In 1993 we criticized the agency for conflicting objectives and too much dispersal. This was not because we wanted to criticize the policy of dispersal, but because we thought it had implications of some magnitude. The government addressed both of these in its policy statement and they were set out in our report in October. So when we move on to phases two and three, we're going to take these as givens. We're not auditing the government's view that a certain amount of dispersal is reasonable, nor will we audit the government's view that development policy is an integral part of a broader foreign policy.
How we're going to do that in concrete terms, I don't know right now, but if I understand you correctly, we're on the wavelength you want us to be on.
The Chairman: Thank you, Mr. Fadden.
I'd like to do a minute of committee business in case we lose our quorum. I'm not suggesting that we will, but I'd like to take this opportunity while we still have quorum.
Members, can we approve the tenth report of the subcommittee on agenda and procedure, which you have before you? You will recall that the subcommittee met and agreed to make additional payments to both the parliamentary centre and to Warren Coutts, who extended their time and effort well beyond the mandate we originally conferred upon them. We approved the amounts set out in paragraph 1, and we also agreed that in order to get the study on circumpolar issues going after Christmas, we should determine who would be the appropriate lead contractor and researcher for that. We recommended to the committee that we approve the parliamentary library to take on that role. Those are the two items.
Mr. Volpe: A point of order, Mr. Chairman. Given the fact that we have representatives from the Auditor General's office, is it politically appropriate for us to expose ourselves to an evaluation of whether this procedure is...?
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Some hon. members: Oh, oh!
Mr. Volpe: This is transparent. I don't know about sustainable.
A voice: This is about as transparent as we can get.
[Translation]
Mr. Bergeron: I am not sure we can wait until the Auditor General has finished with his statement.
[English]
The Chairman: Do I see agreement that it's approved?
Madame Beaumier is not here, but one item that's come up is, with her subcommittee so thinly constituted at the moment, she would like to add two additional members. It's been recommended that Messrs Keith Martin and Reg Alcock be added to that committee. I'd appreciate it if we could give approval to that.
The Bloc is voting against.
Motion agreed to: yeas 5; nays 2
The Chairman: Thank you very much.
Please excuse me, Mr. Fadden, for doing that, but we catch these fleeting moments when we can.
Mr. Fadden: That's no problem at all.
The Chairman: This is the last week of parliamentary business, so I think you can appreciate....
Mr. Fadden: Yes.
The Chairman: All the members have completed their questioning, so once again, we'd like to thank you very much for coming.
If you have any concern about CIDA or anything, I hope you'll communicate either with me or with other members of the committee. I know Mr. Lastewka has taken the time to meet with you and discuss things with you. The members of the committee are very interested both in how CIDA is functioning and in how the audit function is taking place.
We're appreciative of the fact that you're working much more closely together with us as a committee than before, and we look forward to an opportunity of continuing that work.
Thank you very much.
Mr. Fadden: My pleasure.
The Chairman: Thank you to CIDA as well. Thanks, Mr. Robinson.
We're adjourned until 4 o'clock this afternoon, when, you will recall, the French ambassador will be discussing with us French policy in the South Pacific.
Thank you.