About the CFIA > Reporting to Parliament > Annual Report > Annual Report 1998 - 1999  

How We Are Doing

The CFIA was created in April 1997, with a mandate to enhance the effectiveness and efficiency of federal inspection and related services for food and animal and plant health. The CFIA is one of the new service agencies introduced to improve the delivery of federal services to Canadians.

Meeting Our Objectives

To ensure transparent operations and appropriate accountability to Parliament and the Minister, the Canadian Food Inspection Agency Act requires the Agency to prepare a Corporate Business Plan and an Annual Report for Parliament. In addition to financial and other information, the Annual Report must contain information about the Agency’s performance with respect to objectives; the performance information in this section fulfils this requirement. In addition, the Act requires that the Auditor General of Canada assess the fairness and reliability of the performance information being tabled in the CFIA Annual Report. This unique feature is designed to further enhance accountability to Parliament.

The first CFIA Corporate Business Plan was tabled in Parliament in May 1998. The performance management framework for the CFIA, including objectives, strategies and expected results, is presented in the Business Plan. This second Annual Report meets the requirements for reporting to Parliament prescribed in the Canadian Food Inspection Agency Act; it assesses performance against the objectives set out in the Corporate Business Plan.

The objectives of the Agency reflect the scope of its mandate – agricultural inputs, animal and plant health and food safety. These objectives are addressed by the Agency’s programs and activities. Appendix 1 explains the programs and how they relate to the Agency’s objectives. Consequently, this report presents performance information on the results achieved by the Agency’s programs and activities.

Program performance information is reported on a three-year cyclical basis. The criteria for the reporting schedule are: program resource levels; the significance and prominence of the program; logical linkages between programs; and the level of coverage. Major sub-programs (e.g., meat hygiene) and those that are highly visible (e.g., food recall/emergency response) will be reported each year. Program areas with interlinkages (e.g., agricultural inputs) will be reported the same year. Lastly, the cycle ensures that all program areas are covered within a three-year period. The schedule for the proposed three-year cycle is presented in Appendix 2.

For 1998-99, information on the meat hygiene, fish, dairy, egg, plant protection, consumer food products and retail food programs have been captured along with relevant initiatives. Performance information has also been captured for Agency-wide initiatives that contribute to improving overall effectiveness and efficiency and horizontal program delivery areas. The primary responsibility for meeting federal standards and requirements rests with producers, processors and suppliers. Through its inspection activities, the CFIA works with these groups to meet this responsibility. The measures used to report on performance are the level of compliance by the regulated sectors and/or the rejection rate by CFIA inspectors. Compliance/rejection rates measure the regulated sector’s performance and also represent the CFIA’s contribution to a safe food supply.

The extent of performance reporting continues to be limited by the extent of development of data systems to support the performance management framework. This situation has been exacerbated by the need to replace existing information systems to meet Year 2000 requirements. In some cases, this has meant using 1997-98 data, the most current data available.

The performance management framework, and the accompanying measurement and reporting systems, are ongoing efforts that will provide more complete information as they become fully developed and implemented. This past year, the Agency has achieved significant progress in developing the infrastructure required to fully implement a performance management framework. Of particular note is the fact that a planning and reporting framework and process was developed and implemented. The planning framework links program results to activities, resources and objectives. The performance management framework provides a basis for results-based planning in the Agency’s Operations and Programs Branches for the 1999-00 fiscal year.

In the next fiscal year, the Agency plans to develop detailed performance management frameworks for two or three programs. With the recent reorganization of the Agency and the coming review of objectives, the performance management framework must be revisited to develop a structure that provides useful results information to Agency managers. It is expected that a minimum of four to five years will be required to produce a fully-developed performance report.

CFIA Performance Management Framework

The CFIA performance management framework, which follows, provides an overview of the Agency’s functional and program structure; expected results are linked to the elements of the functional structure. The CFIA can be portrayed as carrying out two major functions: the design and development of programs, policies and tools required to produce effective programs and actual delivery (plant inspections, quarantine, management, etc.) of these programs. Both elements are essential to meet the objectives of the Agency.

Agency programs are organized along animal product and plant product lines, providing an integrated approach to Agency services that extends from inputs, such as medicated feeds and seeds, to outputs such as prepared and fresh foods.

This section presents the performance information for selected Animal Products programs, according to the reporting cycle in Appendix 2. For each program, the ongoing performance information is outlined first, followed by results information for key program initiatives.

Meat Hygiene Program³

• 1997-98 Expenditures: $117,544,000
• Full-time Equivalents (FTEs):1,601

³ Information on meat inspection is recorded by calendar rather than fiscal year.

Expected Results: Health, safety and quality standards for meat and meat products are met by industry, and product and process deviations are detected and effectively managed.

The CFIA is responsible for the inspection of all federally-registered establishments processing meat and meat products for Canada and foreign markets. There are approximately 800 federally-registered meat processing, slaughter and storage establishments in Canada. About 606 million animals, including poultry, were slaughtered for food consumption during 1998 (575 million in 1997). All animals/carcasses slaughtered in federally-registered establishments were inspected by CFIA inspectors and/or veterinarians.  Rejection rates by weight are used as a measure of year-to-year program performance. There has been a 0.4 per cent rejection rate by weight for red meat and about three per cent for poultry in both 1997 and 1998. The major cause of rejection was the poor health of the animals. Animals/carcasses condemned by CFIA inspectors are not used as products for human consumption.

All commercial imports of meat and meat products are subject to food inspection in the country of origin and are reinspected by CFIA inspectors upon entry to Canada. Approximately 425,000 tonnes of meat were imported to Canada in 1998 (419,000 tonnes in 1997), an increase of 1.5 per cent over 1997. Rejection rates by weight are also used as a measure of performance for imports. In 1998, CFIA inspectors rejected 1.3 per cent by weight (5,400 tonnes) of imported meat (1.7 per cent in 1997). The rejection rate has remained relatively constant over the last three years. The most common reason for rejection in 1996, 1997 and 1998 was violation of Canadian labelling regulations. Rejected shipments are either destroyed or removed from Canada. (See table below)

In addition to inspection of meat imports, the CFIA conducts on-site inspection of foreign establishments that supply meat and meat products to the Canadian market. During 1998, 48 establishments in six countries were inspected compared to 65 establishments in four countries in 1997.

During 1998, the CFIA inspected about 1,130,000 tonnes of Canadian-produced meat exported to more than 100 countries (984,000 tonnes in 1997), a growth of 14 per cent over 1997. Through multilateral and bilateral agreements, meat intended for export is inspected to ensure that it meets Canadian safety and quality standards and, in some cases, additional requirements imposed by importing countries. Rejection rates by weight are used as a measure of performance for exports. In 1998, 0.09 per cent by weight was returned to Canada either by the importer or by authorities in the importing country (0.11 per cent in 1997). The rejection rate has shown a downward trend over the past three years. The low rate of foreign rejection for Canadian meat and meat products and improving trend are the direct result of the high standards of food inspection employed by the CFIA and Canadian producers. Reasons for rejection are illustrated in the table below.

To improve food safety, the CFIA is currently carrying out an initiative involving processed poultry and poultry products. The science of poultry inspection is rapidly changing as a result of better understanding of poultry food safety risks, and introduction by industry of HACCP systems and new processing technologies. Continuing improvements in poultry inspection techniques have been introduced through the Agency’s Modernized Poultry Inspection Program (MPIP).

The MPIP is designed to improve the safety and quality of poultry products by minimizing the risk of bacterial contamination. Under the MPIP, trained and accredited industry personnel complete carcass and viscera examination, while CFIA inspection staff provide continuous monitoring and verification that poultry slaughter establishment processes are adequate to control defects and reduce food-borne pathogenic bacteria.

The MPIP was launched in 1996. To date, it has been successfully piloted in two poultry slaughter establishments in Ontario and will soon be introduced at two plants in Alberta and one in Nova Scotia. Ten additional pilot projects are scheduled to be implemented in 1999-00.

Fish Program

1997-98 Expenditures: $35,788,000
Full-time Equivalents (FTEs): 441

Expected Results: Health, safety and quality standards for fish and seafood are met by industry and product and process deviations are detected and effectively managed.

Canada is a major fishing nation and one of the largest fish exporters in the world. The trade of fish and fishery products is an export-driven industry within Canada: approximately 87 percent of all domestic fish production is exported; over $3 billion of fish and seafood products are exported annually.

The purpose of the Fish Program is: 1) to develop and promote product and process standards that contribute to the achievement of acceptable quality, safety and identity of fish and seafood products; and 2) to provide an acceptable level of assurance of compliance with these safety and quality standards. Types of inspections conducted include sensory, microbiological, chemical, container integrity, verification of species identification and compositional content, weight and labelling.

Since 1992, federally-registered fish processors have been required to participate in the Quality Management Program (QMP) for fish inspection. The QMP system requires that fish-processing companies develop, implement and adhere to quality-control systems to ensure the production of safe and wholesome fish products.  The CFIA audits the application of the QMP in each processing plant. The CFIA has continued to modify and improve its QMP to conform to the principles of the HACCP food safety system. Draft amendments to the Fish Inspection Regulations to implement new requirements for the QMP were published in the Canada Gazette, on August 1, 1998.

With the re-engineering of QMP, all federally-registered fish processors will be required to develop, implement and adhere to quality control systems to ensure the production of safe and wholesome fish products. Throughout 1998, processors were encouraged to submit their QMP plans for review and acceptance by the CFIA. By March 31, 1999, 901 of 979 processors (92 per cent) had acted on the CFIA’s request to prepare QMP plans while the remainder were in the process of doing so. Of the 901, 141 had their QMP plans accepted by the CFIA while the QMP plans for 760 plants were under review as of March 31, 1999.

In 1998-99, there were 1,857 fish processing operations with approved QMP plans, an increase of 257 from the previous year. CFIA conducted approximately 970 audits of these processing operations during the year to verify compliance with CFIA regulations. A reduction in the number of audits from the previous year (2,300) was necessary to carry out the review of QMP plans. During this transition period, CFIA inspection staff conducted "compliance checks" on high-risk processing operations rather than undertaking full audits. For the most part, these "compliance checks" were carried out in operations implementing QMP plans, to ensure that the safety and quality of products were not adversely affected during the transition period.

In processing operations where a full audit was undertaken, a 90 per cent compliance rate with CFIA quality and safety standards was achieved. Compliance rates are used as a measure of program performance. Those fish-processing operations that failed to meet CFIA standards subsequently modified their procedures to meet CFIA standards and were allowed to continue production. Audit procedures entail the sampling of finished products which are analyzed to determine compliance with quality and safety standards. In 1998-99, inspectors selected samples from approximately 30,920 tonnes of fish of which 94 per cent met CFIA standards. A five per cent drop in meeting CFIA standards from previous year results was incurred because of selection procedures which focused on processors with a history of low compliance. The majority of non-compliance situations involved sensory and microbiological problems. This selection procedure provides a higher level of assurance that overall safety and quality standards for fish products in the marketplace are being achieved.

Inspection of imported fish and fish products is carried out using a random and risk-based sampling approach based on the plant’s, or exporting country’s history of compliance and the nature of the process and product. In 1998-99, 270,000 tonnes of fish and fish products were imported to Canada, of which 15,000 tonnes were inspected (in 1997-98, 283,000 tonnes were imported, with 18,000 tonnes inspected).  Rejection rates by weight are used as a measure of year-to-year program performance. Because of the risk-based sampling approach which targets essentially non-compliant products, 34 per cent of inspected products were rejected (33 per cent in 1997-98). The rejection rate has remained relatively constant over the past two years. The major cause of rejection was for labelling. Products rejected for health and safety reasons were either destroyed or removed from Canada.

In addition to direct inspection of imported fish products by the CFIA during 1998-99, 11 (six in 1997-98) importers were approved by the CFIA to certify compliance with Canadian food inspection standards under the control of the CFIA’s Quality Management Program for Importers. These importers were responsible for about 11 per cent of all fish and fish product imports and 67 per cent of canned fish imports (17 and 50 per cent respectively, in 1997-98).

The CFIA received and responded to approximately 185 trade and consumer complaints about fish or fish products in 1998-99 (200 in 1997-98). Approximately 25 per cent (one-third in 1997-98) of these required a variety of remedial action, such as voluntary removal of product, mandatory inspection of future shipments of similar products and advising the importer or processor of the problem. While the reduction in the number of complaints about fish or fish products cannot directly be attributed to the CFIA’s inspection procedures, the overall reduction in the number of complaints indicates a higher level of satisfaction among Canadian consumers.

Health Canada is currently conducting an assessment of the effectiveness of aspects of the Fish Inspection Program. The results of this assessment should be available for inclusion in the 1999-00 Annual Report. 

Dairy Program

• 1997-98 Expenditures: $8,090,000
  Full-time Equivalents (FTEs): 100

Expected Results: Health, safety and quality standards for dairy products are met by industry. Product and process deviations are detected and effectively managed.

The CFIA’s Dairy Inspection Program requires mandatory registration and inspection, under the authority of the Canada Agricultural Products Act, of any establishments engaged in the interprovincial or international trade or movement of dairy products. The program objective is to help ensure that dairy products produced in CFIA-inspected establishments, or being imported to Canada, are safe, wholesome and appropriately labelled to avoid fraud.  During 1998-99, 275 Canadian dairy establishments were registered with the CFIA. Registered establishments receive in-depth inspections to determine whether processing is carried out in accordance with regulations and good manufacturing practices. Dairy products are subject to regular inspections to assess compliance to the Dairy Products Regulations, the Food and Drugs Act and Regulations and the Consumer Packaging and Labelling Act and Regulations. While CFIA inspectors deliver most program activities at federally-registered establishments, some non-CFIA laboratories are accredited to perform analyses of dairy products. Compliance rates are used as a means to measure program performance.  Performance results for federally-registered products for 1998-99 by types of inspections were:

• health, safety and composition standards (96 per cent compliance);

• label verification (75 per cent compliance);

• net quantity verification (92 per cent compliance);

• ingredient verification (80 per cent compliance); and

• grade verification (95 per cent compliance).

Dairy products imported to Canada are required to meet the same regulatory standards as domestic dairy products and are also subject to product inspections which include some of the following:

• health, safety and composition standards (87 per cent compliance);

• label verification (70 per cent compliance); and

• net quantity verification (85 per cent compliance).

Canadian dairy products are exported to many countries around the world. Close to 4,800 export documents were issued by the CFIA during the past fiscal year. CFIA inspectors monitored more than 300 of these export shipments. Of the shipments examined, 80 per cent were in compliance with the quality, labelling, health and safety and compositional standards set out by the Dairy Products Regulations and the Food and Drugs Act and Regulations. Written action plans are requested from establishments to correct infractions and products are detained, as required, if found to be non-compliant.

Egg Program

• 1997-98 Expenditures: $7,514,000
• Full-time Equivalents (FTEs): 93

Expected Results: Health, safety and quality standards for shell eggs and processed egg products are met by industry. Product and process deviations are detected and effectively managed.

The CFIA has two distinct inspection sub-programs for eggs – shell eggs and processed egg products. In 1998-99, there were 351 shell egg-grading establishments and 16 processed egg establishments registered with the CFIA under the authority of the Canada Agricultural Products Act, compared with 383 and 17 respectively for the previous fiscal year. An establishment must be registered to apply the federal grade names for shell eggs (e.g. Canada A Large Size) or the inspection legend for processed egg products. The frequency of inspection is determined by the weekly volume of shell eggs graded or volume of processed egg products produced by the plant, in conjunction with the plant rating. Samples taken to evaluate imported and domestic/export products are prescribed by a statistical sampling plan using a risk-based approach. This includes analyzing samples for residues, antibiotics, bacteria and marketplace fairness. Compliance rates are used as a means to measure program performance.

A total of 57.5 million kilograms of liquid, frozen or dried processed egg products were produced in CFIA-registered processed egg establishments in 1998-99 (42.6 million kilograms in 1997-98). Products are sampled for microbiological and quality standards. Ninety-two per cent of the product sampled met all applicable federal standards (90 per cent in 1997-98). The compliance rate has remained relatively constant over the last two years.

In 1998-99, a total of 411 million dozen eggs were graded in establishments registered by the CFIA (400 million dozen in 1997-98). Of sampled eggs, 97 per cent were in compliance with the Egg Regulations, in meeting safety, quality and marketplace fairness requirements, as was the case in 1997-98. As noted above, compliance rates have also remained constant over the last two years.

Processed egg exports amounted to about 4.3 million kilograms in 1998-99 (2.8 million kilograms in 1997-98). This product is produced for sale in a liquid, frozen or dried state and shipped to countries around the world. There were no shell eggs exported.

In 1998-99, approximately 7.8 million kilograms of imported processed egg products (7.7 million kilograms in 1997-98) were certified as meeting CFIA requirements. This product is generally imported for further processing at federally-registered plants in Canada.

In 1998-99, there were 7.2 million dozen (7.6 million dozen in 1997-98) shell eggs imported to Canada for the table market. An additional 9.4 million dozen eggs were imported for the processing industry.

This section presents the performance information for the Plant Products programs for 1998-99. Ongoing performance information is presented for each program according to the reporting cycle in Appendix 2, followed by results information for key initiatives, if applicable.

Plant Protection Program

• 1997-98 Expenditures: $33,819,000
• Full-time Equivalents (FTEs): 417

Expected Results: Standards for plant products are met by industry. Disease and pest incursions are effectively managed.

Plant Surveillance Activities

The CFIA’s national plant pest and disease surveillance program assesses the extent and scope of potential risks to agricultural and forestry crops. The Plant Pest Surveillance Unit, in cooperation with CFIA staff across Canada, is responsible for planning, coordinating and administering a national survey program. Plant pest and disease surveys validate Canada’s import regulations and import certificates. The surveys also validate Canada’s "pest-free" status (as defined by the International Plant Protection Convention) required to issue internationally-recognized export certificates.

Surveillance surveys enable the Agency to detect new and incipient pest populations and provide a quick response to prevent the spread of pests within Canada. This is accomplished by establishing quarantine zones and pest-free areas and by identifying the geographic limits of pest populations. The CFIA maximizes its resources in administering the program by involving other government departments, provincial staff and volunteers from non-governmental organizations to conduct surveys in the most cost-effective manner.

The CFIA conducted 33 special enforcement initiatives of shipments entering Canada through Ontario ports in 1998. Four documentation infractions were found with two shipments being refused entry. A similar approach is planned in other areas for the next fiscal year.

Surveys in 1998-99 focused on apple maggot, blueberry maggot, gypsy moth, Japanese beetle, oriental fruit moth, pine shoot beetle, soybean cyst nematode and port-of-entry monitoring for exotic bark beetles and the Asian long-horned beetle. As a result of the survey findings, the following preventative or control measures were put in place:

• On January 4, 1999, the CFIA enacted new import requirements for non-manufactured wood crating and packing material from China, including Hong Kong. This policy change was based on the results of  port of entry monitoring for exotic bark beetles, including the Asian long-horned beetle, which indicated that more than 10 per cent of non-manufactured wood crating and packing material entering Canada from abroad was infested with exotic wood pests. Included in this number were plant quarantine pests, including the Asian long-horned beetle and the European spruce bark beetle.

• In Ontario, four additional counties were found to be infested with the Pine Shoot Beetle in 1998. Pine Shoot Beetle was also found for the first time in Quebec at two sites near the Maine/New Hampshire border. This indicates that the CFIA’s national surveys are effective in detecting the presence of this pest. Forest products and nursery stock moving from infested areas now are monitored to guard against spread of this pest.

• In 1998, as a result of Japanese beetle detection over the past few years, the zones infected in Ontario and Quebec were added as regulated areas. Data will be used for discussions with the provinces and industry when considering the Japanese Beetle U.S.-Canada Harmonization Plan.

Complete documentation on survey and control activities relating to plant health is available on the CFIA Web site under "Plant Pest Surveillance".

Plant Health Early Warning System

The Plant Health Early Warning System (PHEWS) provides early detection of pests and diseases that could be of economic concern if introduced and established in Canada. Based on phytosanitary databases, scientific literature and knowledge of pests of quarantine significance which have been intercepted around the globe, 23 new PHEWS items for regulatory consideration were added to the database. PHEWS continues to be a useful tool for alerting scientists and regulatory officials of new and emerging pest situations that may have an impact on Canada’s agricultural and forestry resource base.

Domestic and Export Certification

In 1998-99, the CFIA inspected 37,500 hectares of seed potatoes (33,500 in 1997-98) on 900 farms across Canada, resulting in seed potato certification for quality and pest and disease status. Approximately 1,900 hectares of seed potatoes were rejected by the CFIA because of plant disease levels in excess of permitted tolerances. This represents a 33 per cent decrease in rejections from the previous year.

In 1998-99, the CFIA issued 55,124 plant health (phytosanitary) certificates (66,000 in 1997-98) attesting to the pest and disease status of plant and forestry products shipped interprovincially and internationally. The CFIA continues to explore better means of evaluating its performance through the development of international standards for reporting rejected shipments directly to the exporting country. Improved international reporting standards would facilitate evaluation of the integrity and acceptance of Canadian phytosanitary certificates.

Import Permits

The Plant Protection import permit office issued about 4,300 import permits in 1998-99 (4,200 in 1997-98). The permits are an important instrument to inform importers of Canada’s regulatory requirements as well as to provide essential information on Canadian import commodities.

Harmonized Standards

The CFIA continues to support the development of improved harmonized regional and international standards through leadership in the North American Plant Protection Organization (NAPPO). This year’s meeting, hosted by Canada, had delegations from Central and South America, Europe, Australia, China, New Zealand and the three NAPPO member countries – Mexico, the United States of America and Canada. As a result of this collaborative environment, a NAPPO Standard on Wood Crating and Packing was codified. NAPPO member countries have agreed to enact import requirements that all non-manufactured wood crating and packing from sources other than continental North America be treated to kill pests by October 2000.

Environmental Sustainability

The CFIA’s environmental policy states that the Agency "is dedicated to promoting environmentally sustainable approaches in our programs and operations". The CFIA is actively pursuing alternatives to dependencies on chemicals where possible. Examples include a new directive on import requirements for untreated fresh grapes from Australia, providing an alternative to methyl bromide treatment and exploring further alternatives to the use of methyl bromide for imports of non-manufactured wood crating and packing material entering Canada from outside the North American continent. Program regulators are conscious of concerns regarding the use of ozone-depleting chemicals and have been exploring efficacious alternatives to methyl bromide.

International Standards and Market Access

Canada’s Plant Protection Program remains committed to influencing the development of international standards through active representation on international committees. Through effective representation, the CFIA continues its efforts to reduce technical trade barriers and improve the reputation of our plant and plant products as pest free, thereby supporting and improving industries’ access to markets.

The following standards and initiatives serve to strengthen Canada’s position on the international-standard setting front, facilitating export trade and helping to maintain consistency with international obligations.

• In November 1998, two International Standards for Phytosanitary Measures were endorsed by the Food and Agriculture Organization in Rome – "Determination of Pest Status in an Area" and "Guidelines for Pest Eradication Programmes".  The NAPPO endorsed five new important regional standards for phytosanitary measures – two dealing with accreditation procedures, one for wood dunnage and wood packing materials, one on fruitfly surveillance and one dealing with biological control of weeds. Both regional and international standards benefit Canada by providing guidelines in trade negotiation procedures.

• In December 1998, a "Record of Understanding between the Government of Canada and the United States of America Regarding Areas of Agriculture Trade" was signed. Under this agreement, Canada will recognize, over the next two years, areas of freedom from the plant disease, Karnal Bunt. With this recognition, U.S. grain will be allowed to be exported to Canada without laboratory testing for this disease. This agreement also allowed the CFIA to implement a program permitting grain to be moved in transit through Canada with only a certificate of origin. This program facilitated the movement of more than 1,685 railcars of grain between January 1 and March 31, 1999.

Seed Potato Stakeholder Group

Since the 1980s, the Canadian government has sought a forum to obtain advice from the seed potato grower community. Although each province has its own provincial grower association and long-standing provincial and industry/grower stakeholder groups, there has never been a national association to provide a position on policies and programs for the industry. In March 1999, the stakeholder groups voted to become a formalized body under the Canadian Horticultural Council. The CFIA will work with the new organization to develop terms of reference and a voting structure which will permit fair and equitable decision-making on the future directions of the seed potato certification program.

Consumer Food Products

• 1997-98 Expenditures: $21,465,000
• Full-time Equivalents (FTEs): 264

Expected Results: Health, safety and quality standards for consumer food products are met by industry. Product and process deviations are detected and effectively managed.

In addition to food safety inspections for meat, fish, dairy, eggs, processed products, etc., which are registered products under the Meat Inspection Act, the Fish Inspection Act and the Canada Agricultural Products Act administered and enforced by the CFIA, the Agency also enforces regulations under the Food and Drugs Act and the Consumer Packaging and Labelling Act. Inspections are conducted in a number of non-federally-registered food plants and food importers’ premises to verify that foods and food processes meet the safety, quantity, composition, packaging and labelling requirements of the Food and Drugs Act and the Consumer Packaging and Labelling Act.

During 1998-99, CFIA officers conducted about 1,400 food safety inspections of establishments. Inspection frequency is based upon the plant’s or exporting country’s history of compliance and the nature of the process and product. During these inspections, CFIA officers assessed the degree of control which manufacturers and importers have over their operations and the compliance of products with regulatory requirements. Compliance rates are used as a measure of program performance. For 1998-99, about 80 per cent of establishments were found to be satisfactory or better. Non-compliance resulted in correction of the problem, education of the firm and, where necessary, appropriate enforcement action to ensure compliance.

CFIA officers also conducted about 1,200 food composition and labelling product inspections in these establishments. In addition to food composition checks to verify the accuracy of ingredient lists and nutrition and declarations and that only approved food additives were being used, inspections were also conducted to verify net quantity and labelling compliance. Laboratory analyses were used to assess composition, identify possible product adulteration, check for the presence of undeclared allergens and misleading nutrition information or claims, especially in relation to imported foods which cannot be inspected at the time of production.

A risk-based approach to verify compliance with net quantity (e.g., weight), composition and labelling requirements, targets high-risk products and establishments suspected of being in violation. Therefore, a significant percentage of these food products were found to be in violation of compositional and labelling standards. Rejection rates have been increasing over the past two years.

In 1998-99, the CFIA investigated about 2,800 consumer complaints (2,500 in 1997-98), with violations resulting in correction of the problem and education of the firm. Where necessary, appropriate enforcement action was taken to ensure compliance. The number of lots of food products examined between 1997-98 and 1998-99 was reduced because of a significant increase in the amount of time required for food recalls, enforcement action and inspector training.

Training was conducted to increase the efficiency of inspecting establishments by ensuring that inspectors are able to address all food inspection and compliance issues. In addition to an increase in the number of food recalls and enforcement actions, prosecutions were required to remove adulterated olive oil from the market and encourage olive oil-distributors to ensure that products imported to Canada meet all Canadian regulatory requirements.

Retail Food Products

• 1997-98 Expenditures: $7,688,000
• Full-time Equivalents (FTEs): 95

Expected Results: Health, safety and quality standards for retail food products are met by industry. Product and process deviations are detected and effectively managed.

Inspections are conducted at establishments which manufacture, process, package or label foods offered for sale to consumers. These inspections verify that food products such as bakery, meat, seafood, dairy and delicatessen products, which are processed at retail, are not substituted or misrepresented and meet the composition, net quantity, quality and labelling standards of the Food and Drugs Act and Regulations and the Consumer Packaging and Labelling Act and Regulations.

During the 1998-99 fiscal year, CFIA officers conducted 2,621 inspections in retail establishments. Inspection frequency is based upon the size of the establishment and compliance history. Checks are made of the composition, net quantity, labelling and advertising compliance of retailer-responsible food products. When necessary, these inspections involve laboratory analysis to identify product composition violations, including product adulteration and misleading nutrient content claims and nutrition information.

A risk-based approach is used which targets food products suspected of being in violation. Rejection rates are used as a measure of program performance. As a result, a significant percentage were found to be in violation. Violations resulted in correction of the problem, retailer education and appropriate enforcement action to ensure compliance. The above graphs illustrate the number of inspections and the results for the last two years.

Laboratories and Laboratory Services

CFIA laboratories provide scientific services that support the design, development and the delivery of CFIA programs to contribute to the safety of Canada’s food supply, the protection of consumers, and control the export and import of food and agricultural products. CFIA laboratory services fall into five main areas: research, scientific advice and consultation, testing, technology development and accreditation of non-CFIA laboratories.

To ensure that CFIA scientific services are internationally recognized as meeting the highest quality standards, the Agency’s laboratories have obtained, or are in the process of obtaining, accreditation by the Standards Council of Canada to ISO Guide 25, the international standard for analytical and calibration labs. This includes ongoing proficiency panels and site audits at regular intervals.

Research and Technology Development

CFIA laboratory scientists carry out research on food hazards and food-borne diseases; on diseases and pests of animals, fish and plants, and on new and improved testing and analytical methods to ensure that foods and other commodities meet international standards for health and safety. The CFIA’s formal research and technology development program supports long-term research. About 25 per cent of CFIA research projects are aimed at the development of new knowledge that contributes to the Agency’s policy development and program design needs. About 75 per cent of projects are undertaken to develop and/or adapt new technologies to meet the Agency’s program delivery needs.

Scientific Advice, Consultation and Accreditation

CFIA laboratory staff provide information, advice and expertise to:

• Support the design and operation of improved inspection practices, such as HACCP;

• Register and license products for use in agriculture, including feeds, fertilizers and veterinary biologics;

• Assist in resolving consumer issues and investigations;

• Assist Canadian and international scientific organizations and trading partners in harmonizing health and safety requirements;

• Establish domestic and international equivalency in laboratory methods;

• Assist in hazard identification and the preparation of risk analyses; and

• Provide proficiency testing and technical audit services required to accredit approximately 75 non-CFIA laboratories to ensure that they meet the Agency’s domestic and international technical and quality management standards.

Testing

Laboratory scientists, chemists and biologists test and analyze samples submitted by CFIA inspectors for purposes of certification, surveillance and monitoring. They also provide special testing services, as required, for investigating issues of concern, outbreaks, or requests for new services. In 1997-98, CFIA laboratories conducted more than 760,000 tests at a cost of $21.5 million. (See Appendix 4 on samples of fish and seafood, animals, plants, food, seeds, feeds and fertilizers for diseases, chemical contamination and microbiological examination.)

Cost Recovery

The CFIA collects fees for service in accordance with the government’s current Cost Recovery and Charging Policy. The Agency’s authority to set user fees is prescribed in various federal statutes, including the Canadian Food Inspection Agency Act. This legislation is the foundation upon which the Agency has established its guiding principles for cost recovery:

• Create an open and transparent approach in developing a partnership with our clients;

• Health and safety services will not be compromised;

• International trade agreements will be honoured;

• Any negative impact on the competitiveness of the agri-food sector will be minimized;

• Adequate resources for regulated services to withstand third-party scrutiny from a legal liability stand-point will be maintained;

• Program redesign will take into account cost reduction, cost avoidance and cost recovery;

• Cost recovery will only apply to those activities from which private benefit is attained;

• Cost recovery will be applied equitably for similar activities and commodities of comparable risk; and

• Service fees should be simple and relevant to the service or product being provided.

These guiding principles apply where there is an identifiable beneficiary for CFIA services meeting industry requirements. User fees are an effective method to fund government services that were previously provided at no charge. Where the introduction of fees impacted on the price of goods, industry has responded by working with the Agency to ensure maximum benefit is derived from the minimum investment in CFIA services, thereby contributing to improvements in cost efficiency. By charging for services, the Agency can respond quickly to industry requirements and without direct cost to the taxpayer.

In 1998-99, the CFIA collected a total of about $50 million in user-fee revenues; an increase of $8 million or 19 per cent over the previous fiscal year. The Agency also has been successful in controlling its expenditures by reducing the cost of programs and services over the last several years. For example, compared with 1995, the CFIA has reduced and/or avoided costs of approximately $24 million in the agriculture and agri-food area and $6 million in the fish inspection area. Appendix 5 provides a breakdown of user fee revenues by program for 1998-99 and for 1997-98. Increased revenues are a result of several factors: 1) approximately $6 million came from new or increased service fees affecting the Seed, Meat Hygiene, Animal Health, Plant Health and Fruit and Vegetables programs; 2) $0.5 million in outstanding fees for services provided in the previous fiscal year; and 3) growth in demand for CFIA services. It is expected that the Agency’s cost-recovery initiatives will continue to generate revenue consistent with increased value being provided to the Canadian food industry.

Year 2000 Initiatives

Year 2000 computer readiness has been an over-riding concern for both public and private organizations throughout the world. In response, the CFIA initiated the Year 2000 Readiness project, with the objective of providing a management accountability structure and action plan to reduce, in a fiscally responsible manner, CFIA exposures and liabilities relating to the potential Year 2000 date problem. The Year 2000 challenge has been a top priority for the Agency since 1996 and significant progress has been made in Year 2000 remediation and testing, as well as business continuity planning.

As of July 1999, CFIA will have reviewed the readiness of various organizations with whom CFIA has a business relationship and prepared contingency plans to mitigate risk in case any failures are experienced. All embedded systems including laboratory equipment, facilities, telephone and office equipment will have been tested and converted to Year 2000 compliance. The Agency will also have completed the development/conversion and testing on all Government Wide Mission Critical (GWMC) information systems. The Year 2000 compliant informatics infrastructure will have been implemented with processes and equipment in place to mitigate against service disruption. All facilities owned and under the direct control of the Agency with potential Year 2000 implications will have been tested and made fully compliant except for one location scheduled for completion by July 31, 1999. The CFIA is attempting to ensure that all other Agency locations that are government-owned or leased will be tested by August 1999.

The CFIA has been working with Agriculture and Agri-Food Canada on addressing the potential impact of Year 2000 on the food supply chain. Furthermore, in order to mitigate risk, detailed contingency procedures have been developed and ongoing monitoring of remediation of risk is in place. Extensive outreach and communications on Year 2000 readiness has been done internally and externally with CFIA stakeholders and clients, as well as our international trading partners.

An independent review, conducted by CFIA’s Corporate Audit and Review Directorate, of the CFIA Year 2000 readiness has been completed. It included examination of the Agency’s project management, renovation and implementation of assets, and contingency plans. This review indicated generally satisfactory results although several recommendations were made to improve the performance management framework, the renovation and implementation process and the contingency planning process. The recommendations have been or are in the process of being implemented. The independent review will continue to monitor key components of the Year 2000 readiness initiative.

Sustainable Development Strategies

The federal government requires all government departments and agencies to prepare a Sustainable Development Strategy every three years. These strategies have been prepared by Agriculture and Agri-Food Canada, Health Canada, and Fisheries and Oceans Canada prior to the establishment of the CFIA in 1997. Consequently, the Agency continued to build on the sustainable development strategies of the three departments, all of which have a direct relationship to Canada’s food sectors. This relationship and the need to address the Agency’s environmental responsibilities, including the establishment of an Environmental Management System, is highlighted in the CFIA Corporate Business Plan. The Agency’s environmental policy establishes an overall sense of direction and sets the parameters for action. The Environmental Management Plan was approved by the Executive Committee in June 1998.

In this context, the Agriculture and Agri-Food Canada Report on Plans and Priorities identifies four sustainable development issues where the CFIA plays a lead role:

1. Enhance the capacity to conduct environmental assessments of products of biotechnology, including feeds, fertilizers, supplements, veterinary biologics and plants. The following table indicates the work undertaken by the CFIA in relation to meeting this sustainable development requirement. These assessments mitigate any potentially-negative impacts on animals or plants. The number of assessments conducted in a given year depends on requests by industry.
   

2. Develop new standards and regulations for contaminants in fertilizer products and animal feeds and assess existing ones. The CFIA has the responsibility to continue to review standards for fertilizer products and animal feeds in accordance with changing industry practices and products. The CFIA continues to review standards in consultation with stakeholders and other interested parties on an ongoing basis.

3. Work with industry to facilitate the development of internationally-acceptable national organic certification and accreditation mechanisms. The National Standard for Organic Agriculture was ratified by the Standards Council of Canada in February 1999. The CFIA continues to work with industry and other governments to develop the accreditation mechanism and enforcement strategies for the organic agricultural industry.

4. Influence domestic and international initiatives in the interests of environmental progress and the Canadian agriculture and agri-food sector. The CFIA is an active participant in the interdepartmental discussions pertaining to the World Trade Organization’s Trade and Environment Committee. The Agency also provides ongoing commentary and makes recommendations on agriculture and trade policy issues.

Environmental Management Review

Consistent with the principles of environmental management, the CFIA endorses the position that self assessment is the most effective tool for managers and staff to assess their own operations in relation to overall Agency goals. Following this assessment, site specific objectives, targets and action plans will be set. The review process will examine 11 major aspects of operations that might lead to negative environmental impacts and therefore need to be documented to address and exercise due diligence. The results of this review will allow future assessment of environmental performance, identify environmental risk and liabilities and support environmental action plans.

Major aspects of food production systems with a direct impact on the environment are:

In response to the Agency’s commitment to sustainable development, the CFIA facilities group are now completing the Environmental Management Review. This review has established appropriate sustainable development goals for the Agency. Action plans are being developed to implement environmental performance measurement. These plans include descriptions of what will be measured, the timetable for implementation, what resources will be allocated to the initiative, who will be responsible for ensuring implementation, and how the results will be reported. The completion of this work is a critical link between the Environmental Management System and environmental performance indicators which facilitate ongoing reporting of results on the Agency’s commitment to sustainable development.

Administrative Monetary Penalties Regulations

The Agriculture and Agri-Food Administrative Monetary Penalties Act (AAAMPA), which came into force July 30, 1997, establishes a system of administrative penalties for the enforcement of the Canada Agricultural Products Act, Feeds Act, Fertilizers Act, Health of Animals Act, Meat Inspection Act, Pest Control Products Act, Plant Protection Act and the Seeds Act. The AAAMPA authorizes the Agency to issue monetary penalties for non-compliance with the aforementioned Acts and their regulations. The administrative penalty system provides an additional option for the Agency to exercise in undertaking enforcement actions against persons who contravene provisions of these Acts and their regulations. The AAAMPA regulations have been drafted and are expected to be published in the Canada Gazette, Part I. The AAAMPA provides for the establishment of a Review Tribunal, an independent body formed to review the imposition of monetary penalties. The Chairperson for the Review Tribunal has been appointed. Ongoing progress in the administration and implementation of an administrative monetary penalty system will continue to strengthen the ability of the Agency to ensure the safety of the Canadian food inspection system.

Plant Breeders’ Rights

The Plant Breeders’ Rights Act requires that the Minister report annually on the administration of the Act. Under the Act, the CFIA grants control of the multiplication and sale of reproductive material to breeders of a new variety. In calendar year 1998, 358 applications for protection were received (216 in 1997), 145 grants of rights were issued (132 in 1997), and 278 rights were renewed (202 in 1997). Revenues credited to the CFIA for this service amounted to $427,000 in 1998 ($318,000 in 1997).

CONCLUSION ON PROGRAM PERFORMANCE

This year’s Annual Report provides performance information on the second year of the Agency’s operations. The program performance information is provided in the context of our expected results and includes a number of initiatives the Agency is undertaking to fulfill its mandate. The CFIA is committed to improving the effectiveness of Canada’s food safety, plant and animal health systems. The information provided demonstrates the significant progress achieved in consolidating the various programs previously delivered by four different government departments.

The Canadian Food Inspection Agency Act established the CFIA as a separate employer on April 1, 1997, and as of April 1998, it no longer operates under the Public Service Employment Act. With this new status came the flexibility to design a Human Resources (HR) Strategy to best meet the emerging and evolving needs of the Agency, including the determination of collective bargaining, job classification and staffing regimes.

The Agency’s five-year HR Strategy was developed in consultation with staff and is available on the Agency’s Web site at (www.cfia-acia.agr.ca/english/toc.html) under Human Resources. It sets the parameters to build a human resources framework based on values and principles identified during the consultation process. The Agency’s progress toward the achievement of this objective will be measured against the following two results statements:

• employees have the competencies required to do their jobs now and in the future; and
• organizational values and principles, identified under the themes of Workplace and People, Employment, and Leadership and Management, are demonstrated in organizational practices. (More detail on the values and principles is available on the Web site.)

During the first two years of the Agency’s existence, the Human Resource focus has been on identifying and prioritizing the organization’s needs, formally adopting the guiding values and principles as the foundation for the Agency’s culture, establishing relevant strategic HR objectives, and designing tailored policies, programs and services. The impact of these activities on the CFIA workforce will be demonstrated over the next three to five years as their contribution to the achievement of the ultimate objective of continuing to develop a workforce whose competence is recognized by both internal and external stake-holders becomes evident. The Agency will then be able to analyze the impact of these activities and identify the return on investment.

Next year, the Agency will concentrate its efforts on implementing newly-designed policies, programs and services along with the provision of training and measuring progress. This will allow us to make changes as needs evolve.

The following reports the progress achieved in fiscal year 1998-99 against the five HR challenges identified in the CFIA HR Strategy:

A Supportive Work Environment
Expected Results: A corporate culture and organizational structure that allow the CFIA to most efficiently and effectively meet its evolving business objectives.

As a follow-up to the establishment of its values, the Agency is moving toward a values-based human resources philosophy. Such a philosophy allows managers to make decisions according to organizational needs, based on the Agency’s values. This will give managers the flexibility needed to respond to changing demands from clients and to deal with situations in different regions and among a diverse group of staff. A values and ethics workshop has been developed and delivered to senior managers across the country to assist in the translation of the Agency’s values into day-to-day practices. This workshop will be delivered to other levels of the organization over the next two years to achieve a common understanding across the Agency.

In April 1997, staff from the four founding departments were brought together to form the Agency. A transitional organization structure was created and senior positions were filled on an interim basis. This led to a perceived need for greater stability in leadership and in organizational structure. To address this urgent challenge and to enable the building of a more effective and efficient food inspection and quarantine system, the majority of senior management positions were staffed permanently and the structure was solidified by:

• moving to a regional structure with four area operations centres and 18 regions, allowing Regional Directors to meet their respective client needs, address relevant geographic issues and manage their own resources within a reasonable span of control;

• consolidating 22 laboratories under one Executive Director, in order to emphasize the importance of science in developing program requirements and to allow laboratories to react to new scientific knowledge, facilitate technology transfer and expand the scope of research through collaboration with other scientific communities;

• establishing Program Networks to bring policy development and interpretation closer to the front lines;

• creating National Service Centres across the country to minimize overlap in administration, finance and information management services; and

• developing generic work descriptions to increase consistency.

An Effective Employment Framework Supporting a Qualified Workforce
Expected Results: An effective employment framework and the promotion of career development to maintain a qualified workforce now and for the future.

Building on a previous analysis which identified priority policy needs, a number of policies were developed in 1998-99. An HR policy framework designed to provide a blueprint for policy- and decision-making on HR matters was developed. The framework is based on the philosophy that managers can be more effective decision-makers within well-defined values as opposed to being overly constrained by rules. To this end, a training package has been prepared to provide guidance in values-based decision-making. A key priority for 1999-00 will be to expand delivery of this training throughout the organization.

The Staffing and Accountability Framework was developed to clarify the delegation of authority and accountability across all staffing activities. The Framework document also specifies which staffing activities are subject to CFIA policies and where past staffing practices will continue until such time as CFIA policies emerge.

A Staffing Complaint Policy was implemented which provides employees with a recourse mechanism where staffing actions can be openly discussed and concerns resolved in accordance with the Agency’s values. Based on information reported on June 1, 1999, only 11 of the 2,067 staffing actions completed in 1998-99 were the subject of a complaint under the policy. Of these, seven were resolved by discussion between the manager and the complainant, and only one went forward to the tribunal level. The decision of the tribunal provided a valuable lesson in process, i.e. that there is room for innovative assessment methods as long as processes are transparent. Three complaints are still outstanding.

Approval of the External Recruitment Policy signalled the Agency’s independence with respect to external hiring. The policy incorporates the flexibility needed to better target specific applicant markets and to recruit specific individuals when appropriate.

Considering the working environment in which many Agency employees operate (e.g., slaughterhouses), strict attention to occupational health and safety must be an integral part of its corporate culture. To this end, revisions were made to the initial Occupational Safety and Health (OSH) Policy through the development of specific role and responsibility statements for various levels within the Agency. This will assist in the monitoring of the OSH Program. Over the next year, the Agency’s transitional OSH training policy will be revised and several OSH-related Treasury Board directives will be reviewed in order to develop directives more closely linked to the Agency’s needs. The Agency’s principles and responsibilities remain in compliance with the Canada Labour Code.

The determination of the CFIA’s collective bargaining unit structure and the certification of bargaining agents was completed in 1997-98, in accordance with the Public Service Staff Relations Act’s requirement for new employers to determine their bargaining unit structure prior to commencing collective bargaining. Twenty-eight groups were officially amalgamated into four bargaining units under two bargaining agents, in order to render collective bargaining more efficient, to facilitate the ongoing management and administration of these groups, and to lay the foundation for more equitable treatment across occupational groups. The CFIA negotiated and signed its first collective agreement with the Professional Institute of the Public Service of Canada in June 1998, covering approximately 500 employees of the Science and Administration Bargaining Unit. An additional 3,400 employees, covered by the Public Service Alliance of Canada were provided with a 2 per cent wage advance prior to the final ratification of their agreement, expected in July 1999. This step was taken as an interim measure to ensure that CFIA employees were not disadvantaged by the Agency’s new status. The Agency was able to negotiate a mutually-satisfactory package with each bargaining agent. Negotiations for an agreement with the VM group are ongoing.

Several HR planning and decision-making tools were made available to guide managers in the HR planning process to ensure a qualified workforce:

• a demographic analysis providing a profile of the workforce;

• an environmental scan of internal and external factors influencing the Agency;

• a Guide for Human Resource Planning to assist managers with the development of future HR plans; and

• a set of recommendations on which managers can act when preparing their HR plans, under the following three broad themes:
  - Renewal, Rejuvenation and Recruitment;
  - Retention and the Ongoing Development of a Qualified and Competent Workforce; and
  - Employment Equity.

The process for HR planning will be implemented on a pilot basis in 1999-00, and will then be incorporated into the business planning cycle over the following three years.

Flexible and Integrated Human Resource Services, Programs and Systems
Expected Results: Human resources systems and programs that are flexible, integrated, streamlined and affordable.

The Agency inherited a variety of HR Programs from its parent departments. In order to increase efficiency and promote consistency within the Agency, and in response to challenges raised during employee consultations, emphasis was placed on the design of an Agency Performance Feedback and Review Program, a Career Management Program and a Rewards and Recognition Program. The Agency’s ultimate objective is to phase in these three programs to reduce administrative burden, promote effective use of management and employee time, simplify communications, and enable access to timely information. In 1999-00, managers at all levels will be expected to set clear performance objectives and discuss these with employees in preparation for the integration of these three HR programs in 2000-01.

The CFIA is currently developing a classification system modeled after the Treasury Board Secretariat’s Universal Classification Standard, as it supports the requirements of the Canadian Human Rights Act to assess skill, effort, responsibility and working conditions when valuing work. The Agency Classification System (ACS) will more accurately value the different kinds of work undertaken within the Agency by allowing jobs to be clustered in a way that aligns them with the specific functions of the Agency. Phase One of the project included the development, in consultation with unions, of a profile of Agency positions and the writing of 100 work descriptions with input from both employees and management, to be used in designing the ACS. Phase Two, the design of the ACS, will begin in the fall of 1999. A new, single classification standard for the evaluation of all Agency positions, excluding the Executive Group, with updated work descriptions for each position, is expected by the end of 2000-01, at which time all employees will be informed of the results. Follow-up activity will include determining pay rates during the collective bargaining process, converting all positions to the new standard, and integrating the ACS with the Agency’s HR System.

An Employment Equity (EE) Strategy and a three-year action plan were developed to improve the CFIA’s ability to attract, recruit and retain a representative and skilled workforce. Four advisory councils representing each of the employment equity groups were created to support Agency initiatives toward EE objectives. Representation of the four designated groups at the Agency increased from 1997 to October 1998, bringing it closer to the Labor Market Availability (LMA), as reported in the 1991 Census.

To address skill shortages, as well as to support the Government Youth Strategy, the Agency developed a Student Internship Program which augments student salaries with scholarships of $5,000 per year. Should students be offered employment at the end of their participation in the program, they would be expected to remain with the Agency for a period of one year. The Program will be piloted in 1999-00 with a target of 10 interns, with full implementation over the next three years.

As a national organization, the Agency has developed a two-year action plan and an official languages policy to set the parameters for service to the public, language of work and equitable participation. A network of coordinators was created to monitor service to the public by tracking the nature and number of complaints and ensuring that proper signage is visible and that publications are displayed and available in both official languages. Public Service Commission as well as Agency language-training programs have been made available to assist employees in maintaining and enhancing their second-language proficiency, enabling the Agency to meet its language of work requirements. Francophone representation has improved from 13 to 24 per cent in the Executive Group and from 25 to 26 per cent in other groups.

Opportunities for Learning
Expected Results: Enhanced opportunities for learning and adaptability to change.

The CFIA recognizes the value of continuous learning in support of its evolving business needs. With this in mind, a Learning Strategy identifying learning needed to address business challenges was developed. A Learning Policy, based on the premise that learning is a shared responsibility between employees and the employer, was also developed. The Policy outlines employee and managerial responsibilities, and identifies criteria for managerial approval of learning.

In consultation with users, current and future technical training needs are identified and incorporated into the National Training Plan managed by Programs Branch. This Plan responds to the ongoing evolution of the organization’s science-based programs. In 1998-99, more than $2.4 million was spent on direct training in the following areas:

• the redesign and evolution of the Agency’s inspection methodologies, including increased emphasis on the audit of industry activities (e.g. the Food Safety Enhancement (FSEP) Program, the re-engineered Quality Management Program (QMP) for registered fish processing establishments and general auditing skills training incorporating the principles of the ISO 9000 standard);

• the continuing health and safety of animals and plants (e.g., pest and disease recognition and control courses such as Foreign Animal Disease Course, fumigation training, Asian long-horned beetle);

• the implementation and monitoring of alternative delivery mechanisms within the CFIA (e.g., the Modernized Poultry Inspection Program, which included accreditation of industry as well as training to conduct systems’ audits of alternative delivery providers); and

• the assurance of a safe food supply and accurate product information (e.g., metal can integrity, food and nutrition labelling and food safety).

Management Competency Profiles were developed and tailored to the Agency’s needs using best practices research. When other related Agency initiatives, such as the ACS and further staffing policies are in place, the need for competency profiles at other levels will be determined. In 1999-00, the Agency will develop the associated learning modules.

Over the next two years, the Agency will develop performance measurement indicators to assess the Learning Program. Benefits from the training provided will be evident over time through the achievement of the Agency’s ultimate objective: to develop a workforce whose competence is recognized by both internal and external stakeholders.

Communicating the Vision and Managing Change
Expected Results: Communication of the corporate vision and effective management of the ongoing process of change.

As the Agency faces the ongoing process of change, the management of change remains a challenge. The CFIA recognizes that employee awareness of issues is of key importance to effective change management. A variety of communications tools have been developed, using media designed to involve as well as inform employees, managers and unions. Joint consultative committees have been put in place to share information. An internal Web site, newsletters, bulletins, face-to-face information sessions and focus-group discussions all contribute to the dissemination of information directly to employees. Many of these information vehicles also provide employees with a direct feedback link to the information source, which provides a measurement of employee satisfaction with Agency activities.

Communicating culture and managing change are difficult to measure in isolation. Over time, the successful accomplishment of these objectives can only be measured through an overall assessment of organizational wellness. This can be manifested through the Agency becoming an employer of choice with high retention rates and strong union-management relations. The organization will, in time, be in a better position to provide a more detailed analysis of workforce trends.

Conclusion on Human Resource Performance

Although only a beginning, a solid HR foundation, respectful of the organization’s values and principles, has been put in place. Key policies, programs, and services will assist in ensuring that employees have the competencies to do their jobs now and in the future. During 1999-00, the Agency will continue to develop its infrastructure and move toward implementation of policies, programs and tools on many fronts.

Critical priorities for the coming year include work on the Agency’s classification system and implementation of activities to support staffing, recruitment and retention. The CFIA will continue to capitalize on its flexibilities as a separate employer to foster the development of a competent and qualified workforce and the creation of a working environment which supports its mission and mandate.

AUDITOR GENERAL’S ASSESSMENT
of Performance Information

Purpose and Scope

The Canadian Food Inspection Agency Act requires the Auditor General of Canada to assess the fairness and reliability of the performance information in the Agency’s annual report against the annual and overall objectives established in its corporate business plan.

The corporate business plan and the performance information in the annual report are the responsibility of the Agency’s management. Our responsibility, as set out in the legislation, is to provide an assessment of how well the Canadian Food Inspection Agency (CFIA) reports its own performance. To do so, I assessed the information against criteria for fairness and reliability that were discussed with the Agency and that are described in Annex I to this assessment. I did not assess or comment on the actual performance of the CFIA.

I recognize that performance reporting is still developing in the federal government. Therefore, in addition to assessing fairness and reliability, I looked at the progress being made by the CFIA toward producing a fully developed performance report. This is the second year that I have provided an assessment of the Agency’s performance information and we, too, are continuing to develop the approach and techniques used in the assessment.

The Agency has reported its performance in a section of its annual report titled "How We Are Doing". Our assessment covers only that section, but does not include the sub-sections titled Year 2000 Initiatives and Sustainable Development Strategies, or the specific case studies used for illustrative purposes placed in text boxes. To adequately assess this additional information would require a separate examination. I did, however, review the entire report for consistency with the performance information.

General Assessment

Data presented are reasonably accurate. The data presented are generally timely, reflecting the 1998-99 fiscal year, but the data on resource utilization and laboratory services date from 1997-98. The performance data I reviewed was adequately supported by the Agency’s data sources and other evidence. However, the report could be improved by providing an explanation of the relative strengths or limitations of the data.

It is difficult for readers to determine how well the Agency is doing its job. The inclusion of expected results addresses a concern expressed in last year’s assessment, and a chart has been added that provides a rudimentary mapping of programs to objectives. However, the expected results have yet to be expressed in clear, measurable terms. The report provides considerable information on individual programs, but performance information is not summarized or compared with the expected results set out in the Agency’s Performance Management Framework or to the Agency’s objectives for food safety, animal and plant health and trade facilitation. This makes it difficult for readers to understand the extent to which the Agency has achieved its objectives.

The Agency’s performance is not compared with that of other organizations. Some year-over-year comparisons are provided, but there is little management discussion and analysis to allow readers to judge the significance and reasons for changes. Thus, based on information presented in the report, it is not possible for the reader to judge the adequacy and consequence of performance levels and trends or whether these are worse or better than planned. In contrast, comparable agencies in some other countries, such as the United States Department of Agriculture and the Australian Quarantine and Inspection Service, have established qualitative and quantitative targets.

Gaps in the information reported lead to a less balanced report. There are numerous key aspects of performance that are not reported, or that are reported only by way of examples. Notably, there is little qualitative or quantitative information about the Agency’s effectiveness in detecting non-compliance. Without such information, compliance or rejection rates provide an incomplete measure of performance.

The report provides very little information on the problems encountered by the Agency or on situations where performance has been less than satisfactory. The omission of this information leads to a less balanced report, and could detract from its credibility.

The illustrative example entitled "Outbreak of Salmonella Enteritidis" was not included in the scope of our assessment. However, I am concerned that there are certain aspects of the case that are not presented. The Auditor General is currently completing an audit of this case and plans to publish the findings in this year’s Report of the Auditor General of Canada.

The Agency has moved to a three-year reporting cycle, with the performance of different programs reported on an annual, biennial or triennial basis. The Agency should nevertheless ensure that key aspects of its performance are reported each year, even though more detailed information in particular areas may be reported cyclically.

Some improvements have been made. I recognize that performance reporting takes time to establish and that the Agency operates in a complex environment. Some improvements have been made in the performance report this year, such as the inclusion of resource utilization by activity and expected results for individual programs. One specific area that shows improvement over last year is human resources performance reporting (see Annex II).

Performance reporting requires an increased commitment. In becoming an agency, the CFIA was given certain operational freedoms not enjoyed by government departments. In return, the Agency is subject to a separate form of accountability and scrutiny, including our assessment of the Agency’s performance information. The improvements made by the Agency in this year’s performance reporting are modest. An increased commitment by the Agency will be required to reach the state of performance reporting anticipated in the Canadian Food Inspection Agency Act.

Conclusion

The Canadian Food Inspection Agency has made a modest improvement in its performance report for the year ended 31 March 1999 compared with last year. The Agency has provided considerable information on its programs, but because of the deficiencies noted above, the report does not provide a clear picture of the Agency’s performance and does not allow readers to judge how well the Agency is performing with respect to its objectives.

Signed

Sheila Fraser, FCA
Deputy Auditor General
for the Auditor General of Canada

Ottawa, Canada
3 September 1999

ANNEX I

Criteria for the Assessment of Fairness and Reliability
Office of the Auditor General

The following criteria were developed as a means of assessing the fairness and reliability of the information about the Agency’s performance with respect to the objectives in its corporate business plan. They address two major concerns: first, has the Agency reported on its performance with respect to its objectives, and second, is that information fair and reliable? Performance information with respect to objectives is fair and reliable if it enables Parliament and the public to judge how well the entity or program in question is performing against the objectives it set out to accomplish. More information on the criteria used in this assessment is available on our web site at www.oag-bvg.gc.ca

To assess the criteria of "Accurate", information reported by the Agency in the performance section has been reviewed to ensure that it is derived from Agency or other established data sources. To the extent necessary, this was supplemented by further enquiry, analysis and discussion to satisfy audit staff that the information presented is adequately supported.

The Agency includes a number of case studies in the report. As these are often intended to highlight exemplary cases, I have not assessed them in detail or assessed whether they are representative of the Agency’s overall performance. Such an assessment would require a separate audit.

The work reported in this assessment was conducted in accordance with the policies and practices of the Office of the Auditor General of Canada. These policies and practices embrace the standards for assurance engagements recommended by the Canadian Institute of Chartered Accountants.

ANNEX II

Assessment of Human Resources Performance Information

While the intention of our assessment is to focus on the Agency’s program performance information, I am including a comment this year on the annual report’s Human Resources section. In becoming an agency, the Canadian Food Inspection Agency was given certain freedoms and flexibilities with regard to human resources management that are different from departments. It is therefore important for the Agency to account for how these flexibilities are being used, and for parliamentarians and others to consider the impact of these new arrangements.

During the past year, the Agency has concentrated on establishing a framework to manage its human resources – the first stage of implementing its April 1998 Human Resources Strategy. Consequently, it is too early to expect reporting of the achievement of the Strategy’s objectives.

In contrast to other parts of the Agency’s performance reporting, the Human Resources section relates accomplishments to the organization’s objectives and goals, specifically its five key human resources expected results, and explains the significance of the accomplishments. As the Agency progresses toward the achievement of its human resources objectives, it is reasonable to expect that performance reporting will improve and will also provide comparisons with other organizations. This would result in a more comprehensive and balanced product.

Where performance is reported, it is generally done in an acceptable manner. For example, the use of "labour market availability" to provide a benchmark for the employment equity policy allows the reader to gauge the adequacy of performance.

The main limitation of the Human Resources performance information section is the absence of information on the current state of human resources in the Agency. Reporting the results of, for instance, staff surveys, focus groups and feedback sessions would provide indications of the state of employee morale and satisfaction within the Agency. This information is important to ensure that performance expectations are realistic and to provide a baseline against which to report in future years. This information is also of interest to the public because of recent media reports alleging concerns about the Agency’s human resources management.