[Recorded by Electronic Apparatus]
Monday, November 6, 1995
.1103 
[English]
The Chair: Order.
We have a quorum, but we're missing one member from the official opposition and the NDP appointee to the committee. I have asked the clerk if she would write to the NDP whip and inquire if they wish to name another person to this committee.
Perhaps, Christine, you could bring us up to date on what's happened with respect to trying to set up our round table of academics. I am afraid we keep running into roadblocks, which is why we cancelled it for today. We are trying to arrange it for Thursday.
The Clerk of the Committee: Everybody seems to be either on the road or on research leave or they have personal reasons for not being able to attend.
As you see from the list in front of you, Dr. Mallory and Dr. Franks will be coming on November 9.
Donald Savoie has gone to Sarajevo to assist them in setting up some form of government there.
Dr. Kathleen Graham from Carleton University is not available. Dr. Sutherland is teaching all day on Thursday, and Dr. Susan Phillips - she's one of the authors of How Ottawa Spends - is also teaching all day on November 9. She suggested Dr. Caroline Toohy, who is at the University of Toronto, but she's on research leave.
Dr. Judith Maxwell is travelling constantly, and on the rare occasions when she is on Ottawa, she usually has to be in the office. She is not available on November 9.
Dr. Paul Thomas of the University of Manitoba would have been able to come, but it was dependent on the strike, which is still going on at the university. I had a message to say that he couldn't come, so I assume that the strike is over and he is deeply involved in catching up on classes for the students.
Dr. Robert Jackson of Carleton University is out of the country until November 13, and I haven't had a reply yet from Dr. Gene Swimmer at Carleton University.
So we have only two confirmed witnesses for Thursday.
.1110
The Chair: And at the most we have three from the original list we looked at.
We can go back to our list of witnesses, if you wish, and try to see if a couple more people are available. We might want to extend beyond academics, to look at a few of the other possibilities that we had discussed for a second round table. In fact, if we had some academics and some non-academics, then it might be a very interesting discussion.
I just asked Brian if he thinks Dr. Evert Lindquist could make a contribution. He was on a panel I was on with the auditor general on Saturday at the Canadian study of Parliament group, on the whole issue of accountability. He certainly might add an interesting perspective for us, if he's available.
Where is he located? In Toronto?
Mr. Brian O'Neal (Committee Researcher): He's at the University of Toronto, but I got the impression that he's working here at the moment. We'll track him down and speak to him.
The Chair: He has worked inside the Treasury Board, as well.
Mr. O'Neal: Yes.
The Chair: That gives another interesting perspective.
Would anybody have a problem with our trying to see if he is available for our Thursday session?
Mr. Williams (St. Albert): He has worked within the Treasury Board.
The Chair: Yes, for a short period of time.
Mr. Williams: Does he have a real understanding of the supply process within Parliament?
The Chair: From what I heard from him on Saturday, he certainly seems to.
Mr. O'Neal: He made some very interesting observations, although he wasn't speaking directly about the supply process. He certainly gave the impression of knowing the whole subject rather thoroughly. I think this is also something that could be determined when we speak to him, just to make sure that he feels comfortable about commenting on the subject.
With the subcommittee's permission, I would also propose that potential witnesses be supplied with a copy of the document that discusses the potential issues the committee is interested in looking at. I think that will help them sort out whether or not they feel prepared to speak to you.
The Chair: If either of those, Lindquist or Dr. Swimmer, is not available, then I wonder if we might go back to our original witness list and perhaps round that panel out a bit. It would then not be a strictly academic panel.
Mr. Williams: What about the C.D. Howe Institute, the Fraser Institute, and these types of organizations?
The Chair: I think we're still going to try to keep a panel that is made up of think-tank groups from different perspectives.
Mr. Williams: You're talking about this coming Thursday?
The Chair: Yes, I'm talking about adding one or two other people for this coming Thursday.
Mr. Williams: Would there be anyone with the background of an historian who could actually add something to this discussion?
Mr. O'Neal: I think Dr. Mallory has a very good historical perspective on this. He is very knowledgeable about the evolution of Parliament, and here we're talking about Parliament in the British context as well as the Canadian context. He ought to be able to answer your questions in that area.
The Chair: One perspective that I thought might make an interesting debate with the academics was some of the management consultant organizations that frequently do business and are fairly adept at identifying shortcomings in the accountability process within government. If the two other professors are not available, then it might be interesting to have that exchange between academics, who have a theoretical view of it, and a couple of management consultants, who have a hands-on, practical view of what's working and what's not working within government.
Two I'm familiar with that I know have an interest in making a contribution, overall, to improving accountability are Coopers & Lybrand - Mr. Pat Lafferty, one of their senior partners, has certainly done a great deal on his own and as a company to make a contribution to this debate - and Peat Marwick, which has an internal group that is constantly examining issues of public accountability.
.1115
Mr. Williams: I can understand them examining public accountability; Parliament is a different kettle of fish that has no parallel anywhere else in the country.
Virtually every other organization I think of off the top of my head is working toward...not a consensus, but the organizations' directors or leaders are there to achieve a decision to move forward, whatever that may be, whereas Parliament, of course, is an adversarial role of government and official opposition, or government and opposition, with different agendas.
Therefore the parallels between a management consultant saying, I feel this is how to get the job done and here are my recommendations to the organization for the decision-makers to adopt in order to get the job done.... It has an entirely different function compared with the way Parliament deals, that is, by debate and voting rather than by arriving at a decision, per se, as we see it in other institutions.
Unless they have something to add within the context in which Parliament operates -
The Chair: Mr. Williams, if I didn't think they did, I wouldn't have suggested them.
Mr. Williams: I appreciate that, Madam Chairman. Of course, I would always acknowledge that you would have that interest at heart. But for the record I would just like to point out that Parliament is unique in the country. Therefore their style of management, the application they use for making recommendations to other institutions, need not necessarily be in any way applicable to what we're trying to achieve here.
The Chair: No, and this is why there may be others, but these are two in particular who I know have focused a great deal on the accountability role of Parliament.
Mr. Arseneault (Restigouche - Chaleur): Madam Chair, we could spend all morning here discussing certain names and then find out they're not available Thursday anyway. We have to give some type of flexibility to the chair and to our researcher and clerk to come up with a half-decent panel for Thursday.
We have a good start with two individuals who have indicated they're willing to come. The names you have suggested are very interesting. The names Mr. Williams has suggested, possibly a mix, might be a solution as well, or you might want to consider a postponement of Thursday's meeting for two weeks to make sure we have a good panel.
I'd like to see a journalist who has an interest in finances and a background in government operations assist us in one of the panel discussions.
I certainly would not feel comfortable going through this whole process and not hearing from someone I respect so greatly on this issue. That is a former colleague, still a colleague in Parliament, Jean-Robert Gauthier. He's a must, and he's available to come in on short notice if we have to. I know he's on the list of possible witnesses, but I think he would definitely be an asset to our study. He has made the public accounts system part of his career.
That's my point of view.
The Chair: Okay. We will do our best collectively to put together the best panel we can for you by Thursday. If we feel you're not going to have a panel worth spending a couple of hours with, we'll delay it until after the one-week break. But I presume we can get four people together.
Mr. Williams: On that note, Madam Chairman, I will note that I have to be back in the riding on Wednesday. I had come in today anticipating that we would have a three- or three-and-a-half-hour meeting, which didn't materialize.
If we are not going to have a meeting on Thursday -
The Chair: We'll let you know as soon as possible.
Mr. Williams: - please advise my office at the earliest opportunity, because I will save the taxpayer the cost of coming back here.
Do I have to be here Friday anyway? I may be able to save the taxpayer the cost of coming back for Thursday and Friday. I'd appreciate that.
.1120
The Chair: We'll try to clarify by late tomorrow whether or not we believe we're going to go ahead with this on Thursday. Okay?
I'd like to proceed. I think we had also agreed to have a Monday meeting the week we're back. I would like to proceed with setting up that other think-tank panel for that day.
Mr. Williams: Are you talking about November 20?
The Chair: Yes.
Mr. O'Neal: Madam Chair, I would just like to add something. I have been in touch with a number of the think tanks we had discussed last week. Unfortunately, neither the C.D. Howe Institute nor the Institute for Research on Public Policy feel qualified at this moment to comment on these issues. However, the Caledon Institute is interested, although they have a fairly full schedule and may not be able to come until December 14.
I'm still waiting to hear back from Dr. Walker at the Fraser Institute and another group, the Public Policy Forum, has thought about these issues and written a report on these kinds of issues. They are definitely interested in coming. I've made copies of the Public Policy Forum's report issued in 1993, in which they talk about changes to the budgetary process and parliamentary reform. I have them with me today and will distribute them to the committee members.
I also want to add that Mr. Allan Freeman, a journalist with The Globe and Mail who writes in areas of public finance, is interested, but he has to think about it a bit. I've sent him a copy of the committee's terms of reference and a list of the issues the committee is interested in examining. I should hear back from him by this afternoon.
The Chair: Okay. So we'll proceed, then, with the list we discussed at our last meeting, to put together the best two panels we can for all of you. If any of you think of other people you might want us to include, either in one of these two or as future witnesses, please let me, Christine or Brian know.
I just want to bring you up to date on the consultative committee Mr. Eggleton has set up to look at the changes Treasury Board is making in the reporting to Parliament. I've been sitting in on the meetings of that committee, and it really is an informal consultative committee. It's not going to be holding hearings or anything like that. It's really to test the views of parliamentarians as this process proceeds.
But very clearly their work is much tied to the work we are doing in terms of the information to be supplied to Parliament and when it's to be supplied. I will do my best to make sure you're supplied with copies of any information distributed or discussed at those meetings. Until now it's been primarily the same kind of briefing we had from Treasury Board officials at one of our earlier meetings.
So could we now turn our attention to the issue sheets? First, can I check that you all have potential issues the committee may wish to consider?
We may want to go through these. Through commenting on what's in front of us, we might clarify what we think are the important issues. When we get to the end of that, I would suggest that perhaps we just go around the table for members to express any ideas they feel haven't come up.
If not today, then certainly at a meeting in the near future we will have to decide what we think are the three main themes we want to address, the kind of direction in which we want to head. Almost inevitably those would become the themes around which our report would be developed. That doesn't mean they need to be etched in stone, but if we start with certain issues we feel are central to our deliberations, that certainly will help guide what we get from our witnesses and how it contributes to our eventual report.
.1125
Under general issues, Brian, I gather that the first is the criteria that Senator Stewart had laid out in his earlier report.
Mr. O'Neal: Yes, that's correct.
The Chair: I'd like to go through them one by one and just invite your comments on each one. These would date back to 1977. Now, that's 20 years ago, and I think our concept of accountability, the role of the public and the role of parliamentarians has evolved substantially since then. It doesn't negate these principles, but we may want to bring them up to date in terms of the current situation.
So can we just start with the first one? Do we generally agree that in obtaining an understanding of the operations of the various departments, branches and agencies, an adequate explanation of their policies is still a relevant principle of the whole business of supply?
Mr. Williams: That's stage one, the first step. The estimates are tabled, and the first thing one has to do is to be able to comprehend where the particular government is coming from, what their intentions and philosophies are, what they're trying to achieve and at what cost.
The Chair: Is ``at what cost'' in there? I think we're coming to that. Are there any other thoughts on that one?
I would add one thing. In some way, in our issues to be considered, I'm not sure there's been enough emphasis on parliamentarians understanding the main directions of a department and the future trends that are going to impact on how they operate and what issues they have to address. What are the key things they see coming up on the horizon that they are either preparing for or not preparing for?
If they're ignoring the fact that there's a whole new development in that field coming down the pipe in a year or two, and as parliamentarians we don't know about that, it's pretty hard to hold them accountable.
Mr. Williams: As parliamentarians responsible for the country and the public purse, that's an appropriate point. In the examination of the departmental witnesses it's appropriate to find out if they are on the ball, so to speak -
The Chair: Exactly.
Mr. Williams: - as far as their department is concerned.
At the front end of the estimates process - this was the outlook concept - it doesn't deal with Parliament's final approval of the estimates, but it does recognize that Parliament has a role in defining public policy and should have input into departmental thinking as far as the creation of public policy is concerned.
The Chair: Are there any further comments on the first one? We were just trying to give some guidance to our researcher to try to refine these a bit.
Let me turn to the second one, ``criticize publicly both the operation and the policies of those bodies.'' There are two key words in there: ``criticize'' and ``publicly''.
Do we agree on ``publicly'', that part of the role of parliamentarians and the committee is public oversight, that Canadians can have a window into what's being done by the various departments?
Mr. Arseneault: We're representing the public so it has to be a public examination. It has to be open to the public, or else the public will lose confidence in those who are doing the examination.
Mr. Williams: I agree totally with the concept of public. Perhaps criticize should be more a case of an ``examination''. It should be -
Mr. DeVillers (Simcoe North): Scrutinize?
Mr. Williams: - ``scrutinize'' rather than criticize.
The Chair: You like ``scrutinize'' better?
Mr. Williams: We would hope that we would always find something to compliment the government when it's doing the right thing. It's sometimes hard, but we do find it on occasion.
Mr. Arseneault: For some governments it's easier.
An hon. member: Oh, oh.
The Chair: Paul.
Mr. DeVillers: It says ``the operation and the policies of those bodies''. When we're talking about the business of supply, is that not the operations and the debating of policies? Is that not done in another form?
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The Chair: That's an interesting issue. My own personal perspective is that it's one of the issues we have to address as a group.
Could the committees in fact integrate the important work they do on policies into their consideration of the estimates?
Mr. Williams: Again, one should consider the front and the back. At the forefront, if there were a system whereby there was an ongoing review of operational policies, we may find segments of society that feel they have some input into a particular policy and would be coming forth perhaps even on an annual basis to make their input. It could actually grow into a closer examination of larger policies, even though we don't have a vote at this particular time on statutory program spending. But I do think we are going to see some methodology evolving whereby statutory program spending has to be examined in some public way on an ongoing basis.
The Chair: I heard Mr. Williams say something else important that we might want to keep as one of our themes; that is, we should invite public comment as well rather than just have the committee scrutinizing. Let's keep that one.
Mr. Arseneault: Let's go back to the policy issue, Madam Chair. I have a problem with that as well in the sense that if you get a minister in the House saying these are the policies of the government and this is the direction we're going in and you then table the estimates, call the officials or the minister before the committee and ask why we are spending this money, it's just to fulfil the commitment we made that we're going in this direction - the policy direction.
So one doesn't go with the other. It allows the minister or the officials to skate quite easily away from the question, to evade the question, in a sense, saying that they've made a major declaration that this is the policy of the department. To fulfil, to reach their mandate, and to implement those policies, they have to do this, and this is where the estimates come from. That's their easy way out of the question.
The Chair: And that's when you get the minister there and talk about the policies.
Mr. Arseneault: But there has to be some type of major look at the issue of policy and how it fits into the estimates. At what stage of the estimates does it fit?
The Chair: That's probably a new issue, a new principle. How does the consideration of the estimates tie in with policy? Because committees look at government policy all the time and make suggestions for changes. How can they bring that work into their consideration of the estimates?
Mr. Arseneault: How are we going to deal with the outlook paper on that department as well, or is that policy-oriented as opposed to expenditure-oriented? That's another issue. I'm concerned from an opposition point of view now that we quite often allow the minister or the officials who appear to skate away or evade those questions quite easily - to fluff them off by having a pat answer saying that the minister made this statement on such and such date in the House, this was the policy of the department, and this is the implementation tool.
So how can you fight one against the other? That policy was accepted in the House or agreed upon or whatever. Where do we go from here?
Mr. Williams: That's exactly what I was talking about. We have to have some methodology of reviewing policy in a public way, where the minister can't just make an announcement and, as you say, the estimates just are a consequence of that statement. Once a policy is adopted by cabinet, estimates shall follow. There has to be more openness.
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Is the estimates the place where that should be? I don't know at this time. As far as new initiatives are concerned, the government does have to recognize that it has to have the right to govern, but the right to govern is also subject to the right to scrutiny. How to marry the two ideas properly as new policy is being evolved I'm not exactly sure, but I am quite firm in my conviction that past initiatives, ongoing programs, have to be subject to some kind of scrutiny and public review on a periodic basis to ensure the current validity, focus, and benefit to the taxpayer.
The Chair: That's a very good principle to include.
Mr. DeVillers: Are the debate and the scrutiny of the policy not done in the House when the government or the minister is introducing their proposed policy? That's the opportunity to debate that in the House. My understanding of supply, then, is simply the implementing of that policy. So we would be having the same debate all over again, wouldn't we?
Mr. Williams: No. I was drawing a clear distinction about new policy by the government. The government has to have to the authority to govern, subject to scrutiny, but I'm talking about past policies that are now ongoing. They have to be subject to public scrutiny and evaluation to ensure they're still providing benefit and value for money to the taxpayer.
Mr. DeVillers: Are those usually done within the terms of the same government, or are you talking about programs that carry over from government to government?
Mr. Williams: No. For example, right now we're all awaiting the social policy review by the Minister of Human Resources Development, and this is going to be the tabling of a document of a review that's taken place behind closed doors. It is going to have the minister's perceptions attached to it. What role or authority or opportunity does Parliament have to review and scrutinize the facts, assumptions, decisions, or recommendations contained in that type of review?
Mr. DeVillers: Well, it's when that's put forward to the House that -
Mr. Williams: But my point is that it may not be brought forward to the House. It may just be an announcement by the minister.
Mr. Arseneault: The standing committee could deal with the subject matter if they desire.
The Chair: Perhaps we can resolve this debate about what committees can and can't do by referring you back to the Standing Orders. This is an amendment that was introduced in this parliament and is now part of the Standing Orders specifically to give standing committees greater latitude in what they do with the estimates. It's about two or three pages into tab 1, but I will just read it to you.
It states that the committees, in addition to the powers they already have:
- be empowered to study and report on all matters relating to the mandate, management and
operation of the department or departments...which are assigned to them...by the House.
- It goes on to say that the committees shall be empowered to review and report on:
- the statute law relating to the department...;
- the program and policy objectives of the department and its effectiveness in the
implementation of same;
- the immediate, medium and long-term expenditure plans and the effectiveness of
implementation of same...;
- an analysis of the relative success of the department, as measured by the results obtained as
compared with its stated objectives; and
- - this is the one we all love -
- other matters, relating to the mandate, management, organization, or operation of the
department as the committee deems fit.
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Mr. Williams: Yes, there's a lot of freedom in the Standing Orders, but the point I was trying to make is that the committee doesn't have the resources to go in and do a complete analysis of any particular program. It can only examine the witnesses who come before the committee.
I am talking here about trying to ensure that statutory programs, which we don't vote upon at the estimates - they are provided for information only - tend to become creatures of habit rather than innovation. I think when we're trying to ensure taxpayers' money is properly spent and properly accounted for, these ongoing programs need to have more public scrutiny than they have had in the past.
The Chair: Is there any disagreement on public scrutiny of statutory programs? Right now, that accounts for about 70% of government spending. Mr. Williams is right; it's generally considered non-discretionary, as in fact it is, and therefore committees have tended to not even look at the statutory programs.
Mr. Arseneault: We should examine the issue.
The Chair: Okay.
Have we clarified operation policies? Obviously, what I'll ask our researcher to do is turn this into some kind of organized collection of the ideas of the committee members.
What about ``discuss publicly from to time the shortcomings of the ministers''?
Mr. Williams: Do you want me to comment on that, Madam Chair?
The Chair: Would anybody like to agree that maybe we should use a more neutral term, such as the ``performance'' of the ministers?
Mr. Williams: I thought we commented on the shortcomings every day.
The Chair: We do; of course we do. I am not sure that's the purpose of the business of supply.
Mr. Arseneault: Ministers or the departments?
The Chair: That's an interesting question.
Mr. DeVillers: You can depersonalize the questions.
The Chair: Ministers or the departments, or both.
Mr. Arseneault: Or just the departments these ministers represent. If you're commenting on the departments, it's a reflection on the minister.
Mr. DeVillers: It should say ``ministries'' instead of ``ministers''.
Mr. Arseneault: Quite often, the minister wasn't there when we were examining the estimates that we're complaining about.
Mr. Williams: I do think we should depersonalize it, certainly to discuss publicly from time to time the operations of departments from an operational point of view. I can think of the public accounts committee where I asked a particular civil servant who was to blame for a particular screw-up and he said, ``Nobody's to blame; the system failed''.
The system is a creation of people and if you look, perhaps not too far, you will find there was somebody who failed.
When the auditor general tabled his report just a month or so ago, it contained information on one particular program that was cancelled at a cost of $60 million. Again I asked the question, ``Whose head rolled here?'' and the answer was, ``No one, he got a promotion.''
We certainly want to have the capacity to look at the administration of departments and not just be required to focus totally on policy only. We must be able to look at the administration and the accountability of the entire department, both from a policy and administration point of view.
The Chair: Yes, I don't have a problem with that. There's another issue, I think. Perhaps we can look back to mistakes that have been made and we can determine whether people are being held accountable appropriately, or if there's a failure in the accountability process that allowed these mistakes to occur, and what's been done to fix it. That's one issue.
The other issue, regardless of how efficiently and well the program is running, is whether it is achieving the results it's supposed to achieve. I think that's something we don't spend enough time on. If we spend time at all on the estimates, it seems to me we spend time on how the money is being spent and on mistakes that were made, but we don't pay a lot of attention to whether or not the expenditure is accomplishing anything.
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Mr. Williams: I'll have to send you a copy of my private member's bill, Bill C-289, where I basically said statutory programs should be evaluated on four fundamental criteria. One, is it still relevant or has the need that existed in society at the time the program was created changed? Has the requirement changed? If so, of course, we would have to tailor-make the program to suit the new criteria.
Two, does it address the need identified? Three, has it been done efficiently? And four, is there a better way to accomplish the same results?
These four fundamental criteria apply very much to what you're saying. It's fine to say we're spending money on a particular program, but are the results being achieved that the program was designed to achieve? For the larger programs, it would be far too mammoth an exercise to think about doing that on an annual basis. But I do think some form of public periodic examinations of statutory programs is a valuable exercise.
This past week, in Vancouver, there was an international conference of 1,500 people from around the world looking at evaluation of programs and how best to do that.
The knowledge base of a kind of emerging discipline of evaluation is arriving at the point now where I do think we should be looking at some form of systemic evaluation of programs. We know that in many cases the program is more repetition than innovation, or we find that the program focus has shifted entirely. Yet we continue to spend the money in the old fashion, with no benefit whatsoever.
That was pointed out just recently with the Atlantic region freight rates subsidy program. It was killed in a budget just passed...$100 million a year. When the evaluation was done by the Department of Transport it found out that it was providing no economic benefit whatsoever, but it had a history of spending $100 million so it had just continued to that point.
The Chair: Did I just hear Mr. Williams say that the government did something right?
Mr. Williams: Yes, and I commend the government for it.
Mr. Arseneault: Any time we cut back, we seem to get support from the Reform Party.
The Chair: Is there any disagreement, though, with the basic approach of looking at programs to determine whether they are still fulfilling - and again we come back to the policy role that you were talking about, Paul - a useful and relevant public policy?
Mr. Arseneault: Will it be the job of a committee to look at that? You start looking at this criterion and if a committee were to sit down.... You know that one of the problems has been in the past that we didn't have the time; nor were members really interested in putting a lot of time into this issue.
So I go back to the other suggestion that maybe we need some type of super-committee to develop some expertise and to put aside time. Or else there should be a certain set time of the year where there are two months blocked off and that's your parliamentary function. The House is not sitting. Those are sitting days for those committees to deal exclusively with the estimates, all by themselves.
Right now, if we start looking at evaluating programs in committees that deal with estimates, you cannot sit here and listen to a number of witnesses, go into some detail, do a good job on them and feel confident that at the end of the day you have evaluated programs sufficiently to say whether or not they are meeting their objectives or whether or not money is well spent.
It's fine to say that this is the way it should be, that this is the ideal situation. But in theory the system we have now is supposed to work, and in practice it doesn't.
I think we have to be a little bit more practical here. I don't know whether we're putting the cart ahead of the horse or not. Maybe once we do get the criteria and say that this should be the mandate and this should be how we do the estimates and how we examine the public accounts then, yes, the only way of doing that would be by implementing this system. Maybe that's the best way and maybe that's the way we're proceeding now. That's fine. But we're going to need a major shift in emphasis if we continue along in the way we're discussing right now.
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We talk about the McGrath reforms. Well, I think the Catterall report is going to be a big one.
The Chair: We'll have to come up with a name that incorporates all our names.
Mr. Arseneault: No, I think you deserve it.
The Chair: Mr. DeVillers, do you have any other comments?
Mr. DeVillers: No, my concern is the duplication again, that we're going to be redoing policy that's being done elsewhere in the departments and in the legislation when it's debated in the House. But I agree with Mr. Arseneault; practically, are we going to be able to accomplish all that?
The Chair: I think Mr. Arseneault has raised maybe as many as four fundamental issues that we have to address.
First, can the standing committees as now constituted do the job that needs to be done, or should there be a special budget committee?
Secondly, I think we've all recognized that the parliamentary committees spend very little time on the estimates. Why? What prevents them from doing a more thorough job, and what needs to change so that they could do a better job?
But I would think, Guy, reviewing from the minutes the things you said just now would yield at least three or four things we need to look at.
Mr. Arseneault: Thank you.
Mr. Williams: I agree with Mr. Arseneault, that we should certainly explore the concept of an estimates or budget committee, because the present system hasn't worked. But we also have to give the incentive to have that committee feel that they are actually capable of making a contribution.
If we look back over the years, I think the reason the committees have not picked up on the estimates is because it has not been seen as an exercise where they can make a contribution; therefore, they have passed on the exercise.
The Chair: Item 4, the business of confidence.
Mr. Williams: Yes. Confidence has to be defined or relaxed or amended in some frame, way, shape or form that allows meaningful contribution to the estimates process.
Remember that Parliament is the holder of the public purse. It's not government; it's Parliament. Parliament's power of control of the public purse has been eroded to the point where it virtually has no control of the public purse at all, knowing that it's been 22 or 23 years since we were able to effect any change whatsoever, and that, of course, was during a minority government situation. Therefore, does Parliament only have control in a minority government situation? I feel that should not be the way.
The Chair: Let me ask that we put those issues as questions rather than as conclusions at the moment.
Mr. Williams: Yes.
The Chair: Does the confidence principle have to be relaxed, redefined -
Mr. Williams: Identified? Yes, I put it forth as a question rather than as a proposal for a solution at this time.
The Chair: Thank you.
Are there any other comments on the confidence motion? Should we get rid of it altogether? Or is it important, as Senator Stewart established, that the House, Parliament, have the ability from time to time to test whether in fact the government still does enjoy the support of a majority in the House? Is there any disagreement that we should abolish it altogether?
Mr. Williams: I can't think, in the way our parliamentary process is constituted, that we can abolish it. On what basis would the government have a mandate to govern if they weren't able to enjoy the confidence of the House, or find out that they enjoyed the confidence, unless we were to move to fixed-term elections? And that's really not what's in the mandate of this committee.
The Chair: So we're not questioning the importance of confidence motions, but there are some questions we need to respond to around confidence.
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On item 5, ``see the entire panorama of public expenditure, both statutory and budgetary'', is there any disagreement with that? I think we've all pretty well agreed that statutory expenditures should get a closer examination by Parliament. I haven't heard any substantial disagreement with that.
It should be done in an orderly way. Would anybody disagree with that?
If I may suggest, though, I think one thing that is clearly new since 1977 is the involvement of the public and of Parliament in influencing the coming year's budget, and I don't think that is reflected at all in these principles.
So the question becomes not only how Parliament can look at the estimates that have already been produced by governments but also start having some input into the coming year's budget early in the budget process. Usually June, at the latest, is the time to start having some influence on the broad directions of the budget for a particular department or for the government.
I don't think I need to remind all of you that a number of things have happened to make that possible: one, the changing of the Standing Orders allowing the committees to do that; two, the production of the outlook documents, which, inadequate as many of them were and putting aside the fact that most committees didn't spend much time with them or use them for the purpose intended, nonetheless are the first stage of that process and I think will be improved.... So there's that whole business of the role of committees in consulting with the public and advising the government through reports to Parliament on what it thinks needs to be in next year's budget, from a broad policy perspective, at least.
Mr. Williams: I agree with the fundamental statement. I have not a concern but an observation: which comes first, the chicken or the egg?
The Chair: I think it's a circle.
Mr. Williams: It could be a circle.
I think back to late October of last year when the Minister of Finance tabled his document, where basically he said that, of course, we have a deficit problem that has to be addressed, but he gave absolutely no indication of any particular direction in which he was thinking about going. Under our tradition of budget secrecy, that was fine, perhaps, but what we found out in the pre-budget consultation process he had proposed was that there was a complete lack of focus in the presentations. They were all over the map, because there was no focus given by the Minister of Finance on any particular, or even general, direction within which he wanted to move. Hence, there was no focus whatsoever to the hearings.
In the outlook stages, perhaps we have to have not policy but some ``what if'' scenarios being put forth by ministers and the departments to try to focus public opinion. Then I think you would get more meaningful feedback from the general public.
The Chair: Is it worthwhile for our committee to look at whether those outlook documents are adequate for the committees to play a role in consulting with the public and advising on the budget to come?
Mr. Williams: I think we're widening the scope of the committee's work to get into areas that.... I think perhaps we should leave the outlook documents for a year or two to see how they evolve under their own steam and then take a look at them rather than trying to tinker with an embryonic idea that hasn't had time to mature, in the public's eye.
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The Chair: Should we, however, have a discussion about how the estimate process supports the work of committees in advising on future year budgets? Because you're right, that's where it starts. The information they get in the estimates determines what they can then comment on for next year's budget.
Mr. Arseneault: I think it should be examined in a general way. To get into some very specific details, unless we decide after our general examination that there might be a recommendation there, dealing with how we apply the estimates and some of the outlook documents, how we tie them together, there could be some relationship there - in fact, there is. But we may want to make a specific recommendation.
For instance, the outlook documents...even now has to be a request made by an opposition member, is it not?
The Chair: I don't believe so.
Mr. Arseneault: To be tabled with a committee or something, or to be examined?
The Chair: Oh, it's not automatically tabled with the committee.
Mr. Arseneault: It's not automatic. It seems to me there is something there.
The Chair: Yes, you're right. It's not automatically referred to the committee.
Mr. Arseneault: Maybe we could make the procedure a little better. Maybe we could decide that someone should look at the outlook document and come up with some specifics about what that document should contain. I don't know. I think it should be examined in a general way so we see where we should go with it.
The Chair: The third thing that it seems to me is new since Senator Stewart did his work is what Treasury Board is now working on, which is accountability in the fall when the public accounts come out...and reporting to committees on performance of the departments.
Again, it seems to me we're spreading out the budget cycle throughout the year, not just at estimates time. Maybe that goes to the heart of what both of you raised - the ability of committees to actually get a grip on this. I guess this is the essence of accountability - looking at the information from the departments on what they did, and not only what they did but what it accomplished, what results they got from all that money they spent.
How does that tie into our deliberations? Shall we leave that one for the moment?
Mr. Williams: It ties more in with statutory program spending rather than ongoing management of the department, because under the present format we're looking at three votes per department: one of grants and contributions, which is anticipatory; ongoing administration, which again is relatively short term in its outlook; and capital expenditures. It's the program spending that Parliament should ensure is in focus at all times. Of course, that's the one area that's totally out of parliamentary control at the moment, and of course we're just coming to that point next.
If parliamentary process was working well, whereby committees, or a committee, which felt the need and the necessity to examine witnesses in detail could hold them accountable for the management of their departments, I think that would bring that in line under the discretionary and budgetary expenditures at this point in time, and then the other half that we have to look at we could do so in some other format or some other way. But I do feel, in light of today's fiscal situation, that we are remiss as parliamentarians if we do not exercise what should be our role as keepers of the public purse.
The Chair: Okay. So we want something in there about the accountability role of Parliament and parliamentary committees - how it holds departments accountable. Theoretically, the changes Treasury Board is proposing are going to help that. But we in fact want to look at whether Parliament is doing its job to hold people accountable for what they accomplish, not just what they spent.
Mr. Williams: And we want to ascertain why the theoretical isn't being followed through into the practical.
The Chair: Okay.
Statutory spending: I think we've already agreed that Parliament should be involved in some review of statutory spending. That subject probably could have a committee of its own working for a year to find out how to go about that.
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Supply days: that's an interesting one. Supply days are now known as opposition days because the opposition uses them to raise whatever issue it wants. Is there any agreement that we should look at supply days? Could they be better used more specifically on the expenditures of government and accountability of ministers?
I don't think we want to get rid of general opposition days, I think we want to find ways of getting more of a parliamentary focus on the whole business of money and results.
Mr. Arseneault: Exactly. It is a misconception that opposition days deal with supply. They're supposed to, but they don't. We should come to grips with that issue and make sure opposition days are opposition days and estimate days or days of supply are days of supply, whether we do that in different way or by making the rules more strict. I wouldn't want to see opposition days eliminated but there has to be some way of getting public debate in the House of Commons dealing with supply issues. That's what we have to come to grips with in this committee.
The Chair: That also ties in with the issue of confidence, because whether or not those opposition day motions deal with the business of supply, government has tended to treat those as confidence motions, whether they go to the original purpose of confidence or not.
Mr. Williams: I understand the notion of opposition days as the concept of grievance before approval, where the crown had to listen to the people speak before the people gave the crown the authority to spend the money. From that old procedure we have our current supply days, where the people are allowed to grieve or complain or put forth their ideas.
The Chair: Or whine.
Mr. Williams: That was in the previous Parliament. We don't whine in this one.
So I agree with Mr. Arseneault. I think opposition days should remain opposition days, but something should be specifically set aside - and more than one day, because right now we only have one day a year where the estimates are on the floor of the House of Commons.
The Chair: Okay, I think there's enough agreement that this is an issue we should address. You may want to consult your caucus colleagues on how they feel about that. Some of those days could be set aside specifically for the business of supply, while others are more general opposition days.
Mr. DeVillers: Where would those days be found?
The Chair: Right now there are twenty altogether and up to eight of them can be votable. Maybe we could find agreement that if the business of accountability and supply is so important, a certain proportion of those days should be specifically dedicated to the business of supply. But then how do we deal with the issue of confidence on supply days?
Mr. Williams: That is the point. If you combine supply days, which are perceived as days where confidence is on the line, with debate on supply, then debate on supply as put forth by an opposition becomes a meaningless exercise or just a matter for debate, because the decision is a foregone conclusion. What I'm trying to say is that Parliament as a whole must be able to have its input without the answer being a foregone conclusion. That's where I'm coming from.
The Chair: There's no disagreement that it is an issue we need to address, and you've raised several points we need to consider around that issue.
On supply and confidence, I think we have dealt with that pretty thoroughly. There's no disagreement that we need to reach some solutions.
I think we have pretty well discussed the role of committees and the fact that there's little incentive now. I personally would like to add to that. I think there is little connection between the estimates and the policy work the committees do, which seems to be the thing they regard as most important.
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One of the things we could look at is exactly what you raised, Paul, the link between the estimates process and the policy role of the committees.
Anyway, on that whole role of the committees and parliamentarians and whether we need another committee, I think we've already made it pretty clear that's something we need to look at.
Is there anything else that needs to be said about the possibility of a restructured committee system?
Mr. Arseneault: Well, there are two areas that I think we really haven't touched on too much in our papers. One is the supplementary estimates. I've always found that supplementary estimates are quite often very specific. They want such-and-such an amount of money for such-and-such a program.
That's an area we could very easily target to start off the reform, the changes we're talking about. That would be the first step, to send all the supplementary estimates to one individual committee, or maybe deal with it in more detail. That would be one area that I could see -
The Chair: They were just tabled last week.
Mr. Arseneault: Yes. In my experience as a parliamentarian, I find that the supplementary estimates receive even less focus than the regular estimates, and you know how little the regular estimates are looked at. In the committees I've functioned with, the supplementary estimates are very rarely looked at - at all. I think that's something we should look at.
The other one is what was mentioned here the other day; I forget if it was by the chair or byMr. Williams. It was the idea of crown corporations. There is a lot of poor accountability in those areas, and they are expending public funds. Quite often there is no accountability to government.
I sat on a task force, and I had the chance to look at confidential internal financial documents of a certain corporation. What I found there was that they had a deficit and debt problem, just like our federal government, but then they still had a budget of $500 million for capital expenditures. They were lowering their regular budget, and their budget looked good. Their target was zero deficit and whatever, and they were really working hard on it. But over on the side, there was this other budget. They were still spending $500 million a year and moving to go even higher, because that funding was going to come from the federal government. That's what they had budgeted and they had made commitments to that, legal commitments.
So I say we are going to have to look at the crown corporations as well to a certain degree, to see how we can get accountability in their system to Parliament. They table their annual reports, but really we're supposed to operate at arm's length from them. They use that for an excuse, and the ministers use that for their excuse for not interfering with them when it's a bad thing. But when it's a good thing and everyone agrees, they can tell them what to do any time.
Mr. DeVillers: It's more than an excuse; it's the law as presently constituted. You're proposing amending the whole system of crown corporations.
Mr. Arseneault: Well, it's the law if you want to use the law.... But quite often there is a lot of influence there, as far as I'm concerned, as far as direction. If everyone agrees to it, if it's a nice thing to do, you know, let's.... It's been done.
The Chair: Is there any disagreement that we should look at the role of Parliament in overseeing the expenditures of crown corporations?
Mr. Williams: Yes, I agree.
Mr. Arseneault: Maybe not all crown corporations in one year, but maybe a target here and there, like the auditor general does.
Mr. DeVillers: I agree with the principle, but I'm just not sure it's something in the jurisdiction of the supply or estimates process. I think it's something else.
Mr. Williams: The buck always has to stop somewhere, and in his most recent report, the auditor general was critical of the crown corporations fulfilling their mandate, or if they even knew the mandate they were trying to fulfil. As I say, they are accountable to government, and government is accountable to Parliament. The buck does stop here.
The Chair: May I suggest, then, this may be more an issue for Mr. Duhamel's consultative committee.
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But I think Mr. Arseneault raised another issue here, which is capital expenditures versus operating expenditures. I personally have always found it extremely frustrating to have huge major capital projects rolled into the operating budgets and to not be able to distinguish a capital project that might go on for 10 years. Some of it was spent in this year, some of it was spent in that year, and there's another couple of hundred million planned to be spent over the next five years. Is that an issue this committee should be addressing or at least providing some comments to Treasury Board on?
I guess what we're trying to come to grips with here is parliamentarians understanding how the money is being spent, exercising accountability for that in terms of the results they get from that expenditure, and influencing future expenditures. Those are the three things I think we're all about here.
Mr. Arseneault: I think you're right in that it goes back to the number one thing - understanding.
The Chair: Yes.
Mr. Arseneault: The estimates have to be put in such a form that we're able to understand, and if that's a problem, we're able to follow it logically. We'll be able to read the estimates.
What's happening now, the way I look at it, is that the public servants are preparing the estimates for the minister to make sure he doesn't get criticized over what's found in the estimates. So they do it in such a way...and the terminology or the format changes from year to year - not every year, but I've seen a change in the committees I have. Different formats are used, and because you are not accustomed and because of a lack of personnel being available to you in your office or here in the committee, it is very difficult to follow the logical conclusions.
The Chair: Becuase you can hold accountable people whom you can follow from year to year, and boy, that has been difficult in the time since I've been here. You're right, it changes.
Mr. Williams: I am glad Mr. Duhamel's committee is looking at the concept of uniformity of presentation between the estimates and public accounts, for example. You see it in the estimates, but you can't find in public accounts, and vice versa. That's his committee, and I'm glad to see that's moving forward in that particular direction.
The Chair: I think Mr. Arseneault raised another issue, which was the business of supplementary estimates. As I understand it, the intention of Treasury Board - and I need to clarify this for myself - is to have that reported more in the fall.
I agree with Mr. Arseneault. The supplementary estimates are an extremely important instrument that's largely ignored by Parliament, because they allow you to see who predicted their expenditures well, who may have kept certain expenditures out of the main estimates because they didn't want to be too closely scrutinized so they could move money around later in the year when perhaps nobody's watching. Who's overbudget on projects and needs more money? What money didn't get spent? Why didn't it get spent? If you thought at the beginning of the year you needed it, why did it turn out you didn't?
Mr. Williams: A billion dollars in supplementary A was tabled last week, just right there.
Mr. Arseneault: Just a billion.
Mr. Williams: Yes, just a billion. A lot of it's coming out of the contingency fund, which perhaps is something else we have to pass comment on. Why are we, as parliamentarians, approving a contingency fund of the magnitude of the one we did this past year? That is, in my opinion, beyond the scope and the role of Parliament, because Parliament should always be approving money for specific expenditures. Setting up a contingency fund of the size of the one we did is certainly worthy of comment by this committee.
The Chair: Well, the contingency funds are reserves. Is there agreement that this committee should look at the idea that contingency and reserve funds do or do not help accountability and Parliament's understanding? Will it go on the priority list?
Mr. DeVillers: I think you need some kind of contingency fund. With any operation, no matter how well planned or forecast, there's always going to be some emergency or something. We need some form.
Mr. Williams: There's always a contingency fund of approximately 1% of budgetary spending, but this year it ballooned to about $2.5 billion to $3 billion. I think that's what the Minister of Finance said was in his potential -
The Chair: Which would make it something under 2%. It's still an increase.
Mr. Williams: We have only $48 billion that we voted on. We're now up to 5%, actually, of $48 billion.
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The Chair: But a lot of that contingency is for statutory programs, too, so that's why I compare it with the total.
Mr. Williams: Okay. On statutory programs for interest rate fluctuations and other contingencies to allow him to meet -
The Chair: Increases in Old Age Security. You don't know in advance what the inflation rate's going to be, for example.
Mr. Williams: But these are the things that normally come back through supplementary estimates.
The Chair: Can I suggest that, for the moment, if somebody wants something included, we include it? I hope we'll then be able to sort out after this morning what our main focus of attention should be, and then perhaps by the time we're ready to report, we may have some things we want to say about these additional points based on what we've heard from witnesses. We may simply want to suggest that there's a need for a further look at some of these elements. Okay?
I think we've talked about pre-review of the estimates. Should standing committees be given the opportunity to review the estimates in draft form before they are finalized? Is that an issue we want to look at?
The way it's evolving, you have the estimates in March or April. You have May and June to look at influencing next year's budget. You have the early fall months to look at the performance of departments so that when you get to the following year's estimates, you can say, ``Okay, you guys didn't perform very well. How are you correcting it in this year's estimates?''
I don't know. Is this an issue the committee thinks it wants to address - looking at draft estimates, which are inevitably going to get changed when the main outlines of the budget are laid down, and that's not until budget night?
Mr. Arseneault: I wouldn't be interested in looking at that issue, personally. If you were in committee studying a draft of the estimates, what type of study would it entail? What type of review would you have of a draft, and how much influence would you have on it? Who would come before us, the minister or the officials, and say that this is only a draft?
The Chair: Is it even possible given that convention of budget secrecy?
Mr. Arseneault: I don't think so.
Mr. Williams: This is true. If a committee takes this estimates process seriously, either they're going to take the draft estimates seriously and ignore the final ones or they're going to take the final ones and ignore the draft.
I also feel that government should listen to public input in the development of its policies and its spending programs, but Parliament shouldn't be co-opted into doing government's job. Parliament approves the request by government. It doesn't get into the detailed debate as to what is in and what isn't in. Parliament's role is to approve, not prepare, the estimates.
The Chair: Okay. I think that's pretty well covered everything that's on that page.
I don't know whether any of you have additional comments you want to make. If you do, perhaps I could suggest that you contact our researcher and have a discussion with him directly. I don't see any reason at this point that any member of the committee shouldn't feel free to do that.
I think we're putting together a shopping list here, not a defined product. I hope we will come out with the framework of a report and the issues we want to address.
At the moment, then, we're planning for a meeting on Thursday at 9:30 a.m. If I feel the appropriate witnesses aren't available to make it worthwhile for all of you, I won't waste your time. I'll let you know that as soon as possible. I hope we'll make a decision by the end of tomorrow afternoon and let you know first thing Wednesday morning at the latest, if that is acceptable.
Is there any other business anybody wants to raise?
Thank you all very much for your time and attention.
I adjourn the meeting.