Opening Statement to the Committee on Public Accounts

Human Resources Development Canada - Accountability for Shared Social Programs: National Child Benefit and Employability Assistance for People with Disabilities (Chapter 6 - 1999 Report of the Auditor General)

Mr. Chairman, thank you for this opportunity to present the results of our study on accountability for shared social programs from Chapter 6 of our April 1999 Report. I am accompanied today by Lewis Auerbach, the lead Director for this study. This chapter is closely linked to chapter 5 - Collaborative Arrangements: Issues for the Federal Government. Should the Committee wish to pursue broader questions related to that chapter, John Mayne, the lead Principal for that study is available to come to the table.

The federal government's role in Canada's social programs has undergone important changes over the last few years. Recently, the government has agreed with nine provinces and two territories on a framework for new types of arrangements in a social union.

Citizens, legislative bodies and, thus, audit offices may justifiably seek assurance that these new arrangements increase, or at least do not diminish, accountability for expenditures on shared social programs and their outcomes.

This chapter looks at the challenges for accountability that characterize the two recently implemented social programs that are already part of the social union: the National Child Benefit and Employability Assistance for People with Disabilities.

I would like to underscore that our Office undertook these case studies at an early stage, so that the partners will have an opportunity to address several important issues while the programs are still being implemented and the accountability regime for the Social Union Framework is being designed. The key question that our Office, your Committee, and the partners in these arrangements need to address is how to assure Canadians that they are getting accurate and adequate information on whether money for these programs has been spent for the purposes intended and whether desired outcomes have been achieved.

In our study, we focussed primarily on the accountability reports that will be published annually for each program. It is through these reports that readers will be able to assess the programs and how well the federal government and its partners have fulfilled their joint commitment to achieving the goals they have set.

Because this was a study of programs at an early stage of development, we did not have formal criteria against which to audit. We did nevertheless have expectations that could be used in a future audit. They derive from our 1997 Report Chapter 11, Moving toward Managing for Results. In particular:

• indicators and measures should be clear and concrete; and
• information should be understandable, balanced, attributable and reliable.

The National Child Benefit introduced in July 1998 has been described by First Ministers as a good example of how provinces, territories and the federal government can work together in the social union. It is an innovative combination of federal tax expenditures (an increased Child Tax Benefit) and provincial programs. Its three main goals are to reduce the depth of child poverty, increase parental attachment to the workforce and reduce overlap and duplication.

We are pleased to note that all partners have committed to achieving transparency and accountability and to publishing annual reports on the achievement of these goals. However, the Auditor General's concern is that despite these commitments, there is the possibility that information may be incomplete, not easily comparable between one province and another, or inaccurate. We believe that the Department shares our concern and is working with its partners to address this issue. This is a matter on which your Committee may wish to obtain further details.

An especially important feature of the National Child Benefit is that the financial commitment of provinces, territories, First Nations and Ontario municipalities is equal to the savings they will realize in reducing social assistance payments by the amount of the National Child Benefit supplement. Assessing whether this commitment has been met presents challenges because of the interjurisdictional issues involved, differences between data systems, and the fact that both First Nations and Ontario municipalities, who were not part of the negotiations, now have reinvestment obligations because they directly administer welfare budgets.

The first report on the National Child Benefit was released in Quebec City just over two weeks ago. One of the most distinctive and positive aspects of this report is that it is a joint product of the participating governments. It also represents their emphasis on accounting to the public for the program, as distinct from accounting to Parliament and provincial legislatures or by one government to another. In our view, accountability to Parliament is no less important than accountability to the public. Your Committee may wish to pursue this point further.

As the federal, provincial and territorial ministers of Social Services say, the report only "begins to fulfill our commitment to report regularly on the progress of this initiative." So clearly, all agree that future reports should provide more information on outcomes and actual expenditures. This may be another matter on which your Committee may wish to seek elaboration.

The National Child Benefit represents a new way of doing business. To parliamentarians and others who wish to examine the early accountability and performance reports on the National Child Benefit, we offer in the chapter five suggestions consistent with the general suggestions that we offer parliamentarians in Chapter 5 of this year's report on collaborative arrangements.

• First, ask how and when we will know if desired results have been achieved. In other words, have reasonable expectations for the accountability reports. At current levels of funding, the National Child Benefit cannot be expected on its own to fully eliminate child poverty or the "welfare wall". Some impacts will not be visible in the first or even the second year, but means of collecting the data to show the impacts must be in place now.
• Second, ask how reliable the information is. How good are the data? How can one know? Information could be unverified and still be reliable, but in what circumstances should only those supplying the information make this judgment?
• Third, accept that the choice of outcome measures is partly political. Consider asking under what circumstances it might be appropriate to delegate the responsibility to independent third parties for implementing or revising the measures and evaluating the results.
• Fourth, encourage transparency and openness by treating the publication of negative trends in outcomes as opportunities for learning or improving the program, not for laying blame.
• Fifth, accept that in an interjurisdictional situation like the National Child Benefit, accountability is shared. Seek answers from those best able to answer. Overall accountability can be achieved only through holding partners accountable for not only their own programs but also overall outcomes.

Our other case study concerns Employability Assistance for Persons with Disabilities. This is the other specific program to emerge from 1997-98 federal-provincial-territorial discussions on the social union. The aim of this 50-50 cost-shared arrangement is to help people with disabilities overcome the barriers they face in the labour force. It is more a traditional contribution arrangement and does not have the unique features of the National Child Benefit. The process of arriving at an agreement was clearly collaborative and partners are committed to transparency and accountability.

Our interest at this early juncture is similar to our concerns for the National Child Benefit -- that steps be taken to ensure that the information each partner will provide is credible and permits meaningful comparisons of different provincial approaches, and that there is an assessment of the program's overall performance. This includes having clear roles and responsibilities and committing resources for the necessary program evaluations.

We note that in the annual reports to be prepared by partners, it is not clear whether there will be an overall report on Employability Assistance for Persons with Disabilities that will permit comparisons and provide information on best practices. We recommend that such a report would contribute to accountability for the federal expenditures, and should be prepared.

Mr. Chairman, that concludes my opening statement and we would be pleased to answer your Committee's questions.