PACP Committee Report

STATUS REPORT

The Committee’s study into the administration of the RCMP’s pension and insurance plans began with an audit by the Office of the Auditor General. In November 2006, the Auditor General tabled a report that included a chapter on Pension and Insurance Administration — Royal Canadian Mounted Police. At the Committee’s initial meeting to discuss the audit’s findings, Assistant Auditor General Hugh McRoberts described the audit’s objective:

The objective of our audit was to determine whether the RCMP had responded adequately to the findings of its internal audit and the investigation by the Ottawa Police Service. We did not re-audit or re-investigate the allegations of abuse. However, we did examine additional allegations that were brought to our attention during our audit. In addition, we looked at whether the Ottawa Police Service conducted its investigation independently of, and without undue direction or bias by, the RCMP.¹

The audit concluded that the RCMP responded adequately to control deficiencies identified in internal audits and the Ottawa Police Service criminal investigation. However, the Office of the Auditor General identified six areas that had not yet been addressed when the audit was completed in October 2006; namely, the RCMP had not yet:

·        ensured that the external investigations of its operations are designed to be, and appear to be, independent and unbiased;

·        reviewed the amounts charged to the pension and insurance plans, for which little value was provided, and determine whether the plans should be reimbursed or credited;

·        provided sufficient internal reviews of business cases that support significant initiatives;

·        ensured that it has charging principles in place for its insurance plans, and determine whether amounts charged to the insurance plan accounts should have been paid by the RCMP;

·        ensured that the insurance administration contract is competitively tendered; and

·        clarified the authority of the RCMP to collect premiums and manage its insurance plans.²

Each of these areas was covered by a recommendation, and the RCMP agreed to all of them. In her first appearance before the Committee, former Commissioner Beverly Busson committed to implement of the recommendations. She said:

As RCMP commissioner, I want to assure this committee that all recommendations stemming from chapter 9 of the Auditor General’s report will be implemented. The majority of those recommendations have already been addressed, and corrective measures are being taken to address the few that remain outstanding.³

The Committee is encouraged by the spirit of cooperation expressed by Commr. Busson. In fact, the Committee learned that one of the recommendations was addressed during its study. The audit found that over $1.33 million of unnecessary and wasted expenditures were charged to the pension and insurance plans, but at the time of the audit, only $270,000 had been reimbursed or credited. Deputy Commissioner Paul Gauvin said:

I can announce today that everything that was charged to the pension fund that should not have been charged has now been cleared out. I had a meeting on Friday with the Deputy Minister of Public Works, who agreed to reimburse half of the remaining balance of the CAC [Consulting and Audit Canada] charges. We’ve had discussions with Treasury Board to reimburse the other half. So now the pension fund is exactly where it should be.⁴

The Committee is pleased that the government has finally taken further steps to reimburse the RCMP members’ pension plan. However, this leaves another five areas identified by the Auditor General to be addressed.

The Committee also heard evidence that several RCMP members billed the RCMP for their golf fees at St. Andrews by the Sea while attending a conference by having the fees included in their room charges. D/Commr Paul Gauvin told the Committee that he had reimbursed the RCMP for these costs and had written to others asking them to do likewise.⁵ It is not yet clear if all those who inappropriately received this benefit have reimbursed the pension fund.

 It has been over a year since the Office of the Auditor General’s work was completed. The RCMP should have been able to make substantial progress on most, if not all of the recommendations. As the Committee accepts and endorses the Auditor General’s recommendations, the Committee would like to know what progress has been made to implement them and what remains to be done. Consequently, the Committee recommends that:

Recommendation 1

The Royal Canadian Mounted Police provide the Public Accounts Committee a detailed status report by March 31, 2008 on the implementation of the Auditor General’s recommendations from the November 2006 Report, Chapter 9. This report should contain confirmation of whether those who participated in the golf game at St. Andrews by the Sea have reimbursed the RCMP pension fund for the benefit they inappropriately received.

Additionally, while the Committee appreciates that efforts have been made to reimburse funds to the pension plan for unnecessary and wasted expenditures, it is concerned about how the amounts owing were calculated with regard to expenses that had been incorrectly charged to the pension plan. D/Commr. Gauvin told the Committee that the RCMP had reviewed all transactions over $50,000 in order to determine if they should have been charged against appropriations, as opposed to the pension plan.⁶ The RCMP then reimbursed or credited the pension plan by approximately $3.4 million.⁷ However, it is likely that there were numerous charges below $50,000 which were also inappropriately charged to the pension plan. This means that potentially hundreds of thousands of dollars owing to the pension plan have not been recovered. While this amount will not have a material affect on ability of the pension plan to meet its obligations, the principle remains the same: money belonging to current and future RCMP retirees was spent on items not related to the administration of the pension plan. As the Committee believes that the pension of RCMP members should be accorded a great deal of respect, it recommends that:

Recommendation 2

The Royal Canadian Mounted Police review all transactions charged against the pension plan in the fiscal years 2000-2001 through 2003-2004, and reimburse any amounts that should have been more appropriately charged elsewhere.