Opening Statement to the Standing Committee on Health

Health Canada—A Proactive Approach to Good Health
(Chapter 9 - December 2001 Report of the Auditor General)

Voted Grants and Contributions: Program Management
Section 3, Canadian Institutes of Health Research
(Chapter 5 - December 2001 Report of the Auditor General)

Illicit Drugs: The Federal Government's Role
(Chapter 11 - December 2001 Report of the Auditor General)

Thank you, Madame Chair, for inviting me here today. I very much appreciate the opportunity to appear before this Committee and discuss our work at Health Canada.

Accompanying me today are Maria Barrados, Assistant Auditor General, and Patricia MacDonald, Principal responsible for our audit work at Health Canada, as well as Peter Simeoni, the Principal responsible for our recent audit work on the management of grant and contribution programs.

The Office conducts various audits at Health Canada, including the following:

• value-for-money audit of Health Canada's programs, issues of environmental and sustainable development, and government-wide management issues;
• financial audit as part of the Annual Public Accounts; and
• annual audit of the financial statements of the Canadian Institutes for Health Research.

Today, I will talk about three value-for-money audits that my Office reported in December 2001.

POPULATION HEALTH PROGRAMS

Chapter 9 of my last Report dealt with population health programs. Through the Population and Public Health Branch, the federal government provides leadership and support for preventive health activities. In 2000-2001, the Branch managed 12 population health programs directed at such issues as HIV/AIDS, prenatal nutrition, and diabetes. Using grant and contribution agreements, the Branch spent $225 million on about 1,800 different projects across the country for the delivery of population health activities.

We highlighted two major areas of concern in our December 2001 Report:

• First, while we found a clearly defined management process for grants and contributions, it was not consistently applied. We identified a number of cases where there was chronic disrespect for and ad hoc use of the management process.
• Second, we found that the Branch had failed to measure and report on the impact that these programs have had on the health of Canadians.

I will briefly comment on each of these areas.

Management of Grant and Contribution Projects

We reviewed a sample of projects selected from three population health programs and found inconsistent management practices:

• The projects in the Canada Prenatal Nutrition Program were generally well managed.
• Many projects in the HIV/AIDS strategy were poorly managed, regardless of the dollar amount funded. For example, we found projects that were approved despite concerns that had been identified during the selection process. We also found several cases in which the Branch had failed to take timely action to remedy identified problems with projects that were under way.
• Six large national projects in the Population Health Fund suffered from specific and significant problems. In particular, management did not have the proper authority to fund projects for prostate cancer research and enhanced fitness activities. Further, these projects were not subjected to the required selection and approval processes.

We believe that the Branch should take corrective action to ensure that the procedures for selection, approval, monitoring, and evaluation of all projects follow the established project management process.

Measuring and Reporting Results

We found that evaluation of population health programs is generally weak. Objective information on the effectiveness of the three programs that we looked at was limited, and little progress had been made in developing performance indicators. The Branch does collect some national data on individual projects in the Canada Prenatal Nutrition Program, which provides information on Health Canada's investment in infant and maternal health. However, the information that Parliament receives on population health programs does not provide a clear picture of the extent to which the $225 million spent on programs has improved the health of Canadians.

We believe that the Branch needs to improve the measurement and reporting of program results.

We made recommendations for dealing with each of these problems, and I am pleased to note that Health Canada accepted all of them. In fact, management began working on some of these issues before we had finished the audit.

Canadian Institutes of Health Research

In Chapter 5 of the 2001 Report, we presented a government-wide look at the management of grant and contribution programs, which included an audit of the Canadian Institutes of Health Research. We examined the organization's operating grants program, which in 2000-01, the period covered by our audit, provided $190 million in funding to medical researchers in Canadian universities and hospitals.

We were impressed with the rigorous way that the organization selected the research projects that it funded. It uses a peer review system, and we concluded that this system is working well.

However, while project selection was rigorous, other aspects of the management of the program were not. We found that the organization did not track how quickly grant recipients were spending the money or take action on large, unspent balances. Nor was it systematically tracking the results of the research it funded. We also found that the organization had few results measures for the operating grants program, despite the amount of money it handled every year. Not surprisingly, scarce performance information meant that reporting on performance to Parliament was also limited.

I am pleased to note that the Canadian Institutes of Health Research accepted all of our recommendations. Similar to Health Canada, management began working on some of these issues before we had finished the audit.

ILLICIT DRUGS: THE FEDERAL GOVERNMENT'S ROLE

Illicit drugs are an important issue for Canada because of their significant negative impact on the health of Canadians and our economy. In Chapter 11, we examined the issue of leadership and co-ordination among the players.

Since 1987, Health Canada's role is to provide national leadership and co-ordination in efforts to control illicit drugs. It has chaired the two key interdepartmental committees on illicit drugs, and it provides co-ordination through the Office of Canada's Drug Strategy. However, most of the federal government's related activities are in law enforcement. The federal government's changes to legislation relevant to illicit drugs over the past five years have largely focussed on reducing supply (enforcement) rather than on reducing demand.

For Health Canada, the illicit drug problem is secondary to a great many other health issues. The Department's authority and role as co-ordinator of the Drug Strategy is limited to providing secretariat services.

We understand that the renewal of Canada's Drug Strategy is under way, and we recommended that the government review the current mechanisms for leadership and co-ordination within the federal government.

FUTURE AUDIT WORK

I have recently identified five priority areas to address during my tenure as Auditor General. One priority is the well-being of Canadians, which includes health. Plans on how to address this priority over my term are being developed. I would be pleased to present the Committee with a copy of my long-term plans once they are finalized, and I welcome any suggestions on areas of interest.

• In September 2002, I will table a Progress Report on Federal Support of Health Care Delivery (Chapter 29, 1999 Report) and National Health Surveillance: Diseases and Injuries (Chapter 14, 1999 Report).
• In September, we will also be auditing the accuracy of Health Canada's report on health indicators as agreed to by the First Ministers.
• In November 2002, we will be reporting on Statistics Canada's handling of health statistics.

Madame Chair, thank you for your interest in our work at Health Canada. My colleagues and I would be happy to answer any questions.