Opening Statement to the Standing Committee on Health

Health Related Chapters of Reports of the Auditor General of Canada

Madame Chair, thank you for this opportunity to appear before your Committee to discuss our work. I have with me today Ronnie Campbell, Audit Principal, who was responsible for much of the work on Health Canada and Doug Timmins, Assistant Auditor General responsible for the audit of regulatory and agriculture programs.

Since this is a new Committee, I would like to take this opportunity to provide you with a brief overview of the mandate and work of the Office of the Auditor General. I would also like to summarize our recent audit reports on Health Canada, as well as work that we now have under way.

As you know, Health Canada's budget for 2000-2001 is just over $2 billion this fiscal year and it has over 6,700 employees. Its programs and activities include work to protect and promote the health of Canadians, ensure the provision of health services to First Nations people living on reserves, and administer the Canada Health Act.

Health Canada's work presents it with several challenges, as is evident from our audits, in undertaking its work. These include complexities related to jurisdiction in the area of health, political sensitivities related to the Canada Health Act, and challenges the Department faces in working with First Nations to deliver health services to them.

Under the Auditor General Act, the Office of the Auditor General is responsible for conducting independent audits and examinations. We undertake financial audits, special examinations of Crown corporations, audits of environmental and sustainable development activities, and value-for-money audits of departments and agencies. Our audits focus on the implementation of policies and programs and also examine government-wide issues such as Estimates, performance reporting and financial management.

Each year we submit up to four reports to the House of Commons. One of these is the report of the Commissioner of the Environment and Sustainable Development.

We plan our work on an annual basis. In developing these plans, for future years, we would be interested in hearing about issues that your Committee considers important for audit examination.

On March 5^th, the Auditor General wrote to the Committee to raise some outstanding issues from value-for-money audits that may be of interest to the Committee.

I will briefly summarize some of these.

Our 1999 Report included chapters on national health surveillance and the management of a food-borne disease outbreak. We observed weaknesses in national surveillance of diseases and injuries that, taken together, have clear national implications for public health. First, these weaknesses compromise Health Canada's ability to detect, anticipate, prevent and control health risks associated with outbreaks of communicable diseases and with other health threats. Second, they compromise its ability to plan, carry out and evaluate public health programs and other programs that deal with the causes and treatment of diseases.

In examining the outbreak of a food-borne disease, we found a lack of full co-operation among the agencies involved in responding to it. The Public Accounts Committee held a hearing on these chapters and issued a report. The Department concurred with our recommendations; corrective actions are ongoing.

In recent years, we have reported to Parliament twice on the management of health services delivered to First Nations, on which Health Canada spends over $1 billion a year. In 1997 we reported serious shortcomings in the Department's management of its contribution agreements and transfer agreements with First Nations for delivering of the services. We also found significant weaknesses in the way it managed Non-Insured Health Benefits, including pharmacy benefits.

In our 2000 follow-up we noted that we remain concerned that Health Canada has not made enough progress in fixing many of the problems we had identified in our 1997 audit. Both your Committee and the Public Accounts Committee held hearings regarding our 1997 Chapter. As you may be aware, Madame Chair, the Public Accounts Committee has asked us to appear before it on April 5^th to discuss that follow-up work.

In 1999, we reported on Health Canada's administration of the Canada Health Act. Health Canada does not have information it needs to effectively monitor and report to Parliament on the extent to which provinces are in compliance with the Canada Health Act. Parliament cannot readily determine from the Department's annual reports on the Act, to what extent each province and territory has satisfied the five criteria and conditions of the Act.

Federal funds are transferred under the Canada Health and Social Transfer in a block, allowing provinces and territories the flexibility to allocate the funds as they choose among health care, post-secondary education, and social assistance and social services. As a result, the federal government is not in a position to determine what its total contribution to health care really is.

In September 2000 the First Ministers issued their "communiqué on health" committing to provide clear accountability reporting to Canadians. This accompanied the announcement of $23.4 billion in new federal investments over five years to support health renewal.

First Ministers directed Health Ministers to collaborate on the development of jointly agreed upon indicators such that each government will begin reporting by September 2002. These comparable indicators are to address health status, health outcomes and quality of service. This public reporting will involve independent third party verification.

Each jurisdiction is to report on a series of 14 indicators that have been agreed upon. Some provinces have already indicated they want their provincial auditor general to undertake this independent verification; other provinces have not yet decided who they will designate.

Health Canada, on behalf of the federal government, also has an obligation to report to Parliament on these 14 indicators. The Office of the Auditor General expects to be asked to provide the independent verification.

Madame Chair, your Committee may wish to ask Health Canada for further information on what action it has taken in response to the recommendations in our chapter on the Canada Health Act, as well as its progress in implementing this new reporting regime.

Federal health and safety regulatory programs may also be of interest to your Committee. In December 2000 we issued a chapter on major trends and the challenges facing health and safety regulatory authorities. Other chapters examined food inspection programs, the regulatory regime for biologics and regulation of nuclear, power reactors; another followed up on previous recommendations.

The broader chapter dealt with major trends and challenges faced by health and safety regulatory authorities. We expressed our concern about the capability of federal health and safety programs to overcome recurring weaknesses and meet significant challenges. We noted that dealing with these problems and challenges in areas such as food inspection, biologics and power reactors regulation will require determined and co-ordinated action between federal departments as well as co-operation between the federal, provincial and international jurisdictions.

Madame Chair, your Committee may be interested to know about work currently being undertaken by our Office on Health Canada.

Our December 2001 Report will include a value-for-money chapter on health promotion. In 2000-01 Health Canada spent $358 million on health promotion activities. We will be looking at the management of grants and contributions and other issues related to promotion programs.

The December Report will also discuss our follow-up on our 1998 audit of the Patented Medicine Prices Review Board. We will look at whether the Board has implemented our recommendations as it agreed to do.

The Commissioner of the Environment and Sustainable Development has also tabled several chapters that address the relationship between the environment and health. The Commissioner's next report, to be tabled in October, will include additional chapters that may be of interest to you.

Madame Chair, that concludes my opening statement. My colleagues and I will be pleased to answer your Committee's questions. In addition, we welcome your suggestions on issues of particular interest to the Committee for consideration in our planning.