EdinburghNLP/nunavut-hansard-plusplus huggingface dataset:
The amount of flexibility that is added to that process, when you say there is a two percent increase or a three percent increase, it is based on what available resources we have or financially what is available.
So, by the end of next year, we’ll go through that similar exercise and that process is repeated on an annual basis.
If we were in a deficit situation and we had to go through a cost cutting exercise, that’s part of the whole process.
We figure out how much money we have and it’s by forecasting.
It’s by monitoring our expenditures on a regular basis and this exercise that we went through, we had some dollars set aside for new initiatives and each department was given a target.
But, really at the end of the day, how we determine that is how much money we have, flexibility to work with.
Again, and I recognize the difficulties around the details of extra funding or not, but when you’re looking at historical data from the departments, for how many years does that go back.
First we always have the information on the current year, but departments also have the information on the last two or three years back as well.
So, depending on what the issue or situation is, we can look back to those historical spending patterns as an example on X,Y,Z programs.
Our first budget for Nunavut was based on whatever the percentage was of the total territorial budget at the time.
Our funding is based on that.
I know and I’m sure my colleague has raised it here, today, is that the budget that we inherited from the Northwest Territories was a cut budget.
It was slashed.
They cut deeper, they even cut some bone out in that budget in the final years leading up to division.
If we’re basing our targets from those initial numbers that were brought over, then whether be in different programs or services or anything that I think they were very inaccurate and that maybe some other type of process needs to be looked in evaluating whether those targets and the numbers that we’re going by are accurate and really meet the need that we have out there for the demands on our programs and services.
A perfect example of that is under the Department of Health and Social Services.
For the last five years, they’ve been chronically under funded right from the get go.
I’ve said in the House before, that on questioning the accuracy or the validity of the budgeting if say, health is given X amount of dollars and we already know before they even start that they’re going to be between $10 and $20 million in deficit by the end of the year.
I’m just wondering if the minister can indicate if there are any initiatives that the department is looking at on a government-wide basis to see if we can try and tighten up and improve on the system that we have in place right now for allocation and setting of targets.
In seven years, I think we’ve done a very good job.
In seven years, we’ve gone from a very small organization with no assistance to what it is today.
We’ve gone through a huge growth in our resources.
I mentioned that we are now close to a billion dollars in funding from transfer payments compared to six hundred million April 1, 1999.
So, I can’t speak for what happened seven years ago in the exercise of budgeting, but I can speak for the process that we have in place now.
As Nunavut grows in terms of years, we’ll have better historical information on activities.
Every year, those patterns are setting patterns or those factors are being monitored, so we build on that and we’re building on what we’ve learned year by year.
So, the ongoing effort to monitor department growth activities is there and we recognize the concerns related to health and we have increased the Department of Health budget again this year.
There’s always going to be challenges, but we are trying to address the pressures by allocating the resources where it is needed.
I can appreciate the minister’s comments and that, as time goes on, we’ll get more of that to look that.
But, the basis for studying the budget is based on historical data that may not have been accurate and the departments, for the most part, hold the line when it comes to being what they’ve been budgeted.
So, in a lot of cases you’re not going to get a overrun in one area, if they run out of money, they say, sorry, we don’t have any money.
You know, there’s a lot of programs and services out there like that.
I know that the minister, the former deputy for the Department of Culture, Language, Elders and Youth.
You know if they in the past, if you look at the historical data you know one year they had no grants and contributions X amount.
You know 90% of those or a large portion of those grants were used up in one area, yet the following year, they didn’t increase that amount.
They left it the same or lowered it and did the other area.
Maybe, if I said that the minister was doing a great job, everything was fine and dandy, she’d agree with me.
We are in 2005-2006 main estimates.
Madame Minister did you want to respond?
Hon. Leona Aglukkaq: Mr. Chairman, I believe Tootoo’s comments were personal in nature and I will not respond to him.
I would just like to say the minister is shaking her head at some points that I was making the same thing.
You know, if she would take the time to listen to the question instead of having...
Chairperson (interpretation): Ms. Aglukkaq.
Hon. Leona Aglukkaq: Mr. Chairman, I’m sitting here to deal with the Department of Finance’s main estimates.
If a member wants to make comments to me of a personal nature, we can deal with that on the side.
Chairman (interpretation): At this time, in order to proceed properly, order please.
We are on the Department of Finance of the government.
We are working on the 2005/06 main estimates.
As I stated earlier, please keep your comments to the point and to the subject at hand in order to proceed properly.
Any other comments. Mr. Tootoo.
The point I was trying to make earlier, the minister had indicated how they determine what the targets were and based on the spending that had been budgeted.
I’ve seen in the last five years where certain programs were budgeted X amount of dollars and more than that was spent, but stuff was moved around internally, so you don’t see any overspending and that’s what I meant, that was what I was trying to get at, if those numbers aren’t adequate, yet they’re not going over, there’s internal stuff, then how do we really know that those numbers are adequate.
And that’s the point that I’ve been trying to raise here.
We’re on C-6, fiscal management.
For the last five or six years, we’ve had an overall balanced budget in the past five or six years.
When stuff is moved around, as I mentioned earlier to Keith’s question, that movement of salary dollars to whatever are approved through the House.
They go through the main estimates process.
When you approve the main estimates and you approve a line item and there are changes in that category, there is a requirement to go forward for that approval in the House.
That’s usually done through a supplementary bill.
How accurately are we... the supplementary bills will tell you, Mr. Chairman.
That process I mentioned earlier, we don’t just make those changes singlehandedly in the department.
We go forward through members here for approval.
That’s a process that’s been in place for six years now.
What happened five years ago, I can’t speak to.
I was not here five years ago.
So, what I can speak to here is what we’re dealing with today.
What happened in the past five years ago, I wasn’t here to be a part of that, so I can’t comment on that.
I’m not talking about anything that happened five years ago.
I said over the last five or six years, I’ve seen these things happened.
I’m a little confused now, because earlier on the minister had indicated that any internal movement had to go and were approved by the Financial Management Board.
Now, she’s saying that they have to come to the Assembly for approval.
If that’s the case, I’d like to see all the decisions that were made by Financial Management Board get brought forward to this Assembly for us to look at.
It’s my understanding that those decision were made at the Financial Management Board level on the internal line item movements within their operations and maintenance budgets for each department, that they didn’t have to come in a supplementary bill.
The supplementary bills were only if you were moving money from capital to operations and maintenance, or increasing or decreasing funds in certain areas.
So, I would just like to ask the minister if she could clarify that because I’m not sure how things are supposed to work now.
Hon. Leona Aglukkaq: Thank you, Mr. Chairman. Your confusion is noted.
What I was trying to explain earlier as a response to Mr. Peterson’s question was related to salary dollars.
That’s an example I used.
We can’t just move salary dollars in the department to a capital project, as an example.
We can’t take capital dollars and move it to the Department of Health from the Department of Community and Government Services without approval.
That’s the process I am talking to.
I am talking about, and that has to come through here.
I have two supplementary appropriation bills that I am going to be introducing next week.
One is on capital, which is a supplementary appropriation bill to take last year’s capital dollars to this fiscal year.
If there are going to be any changes to departmental items to increase their dollars, of course, that goes to the supplementary appropriation bill.
The same process exists that has been in place for six years.
Mr. Tootoo your time is up.
We are dealing with the Department of Finance.
I understand what the minister is stating there, and that’s my understanding of how it’s supposed to work, and how it has been working for those types of transfers.
What I am talking about is more within a department’s programs, and an example, just an example that has nothing to do with anything about this, one that I recall vividly is in Department of Culture, Language, Elders and Youth’s contributions they had, lets say we will just use round numbers of $10,000 for youth grants and contributions, and then another $10,000 for elders’ contributions, and then another $10,000 for heritage contributions.
When I see the end result of the list of grants and contributions that were distributed, there was I think close to 80 percent of that $30,000 went to youth programs and grants and contributions.
So when the next year’s targets were set, they are set based on the budgeted amounts, not what the demand was.
I guess that’s what my point is because there was a huge demand for funding dollars in this particular case for a youth program, and yet the next year there was no increase to that area.
That’s, as I said, a particular example that I am talking about, but that whole scenario of how things are moved, and those changes never came to the House in the supplementary appropriation bill.
Well maybe, that’s why I am confused, and I was saying that this is, say one thing and yet something else is done.
I understand for moving from department to department their capital operations and maintenance or salary that something else is one thing, but in those program and service areas, if they are not required to do that, any change, and I don’t even know if those go to Financial Management Board or they are just done at the departmental level.
Again that’s why I said, I wonder what the accuracy of the numbers of the historical data that, in that case, nothing changes, it actually went down.
I am not trying to be critical of anybody, and I am not pretending to know a heck of a lot more than anyone either, I am just trying to figure out and identify an area where something may not be being identified through the processes that are in place and to try, and find ways where we can address some of these issues and fix them so that we have a more accurate or better understanding of how and where we should be allocating our resources as Members of this Assembly.
I don’t know if there’s a question there.
Hon. Leona Aglukkaq: I didn’t hear a question, Mr. Chairman.
Mr. Tootoo, would you like to ask a question?
Mr. Tootoo: I would maybe ask the minister if she understands where I am coming from on that.
That’s my explanation.
Is that clear enough or maybe I could sit down with her and her officials at some future point if we don’t understand each other to try and clarify and talk about it instead of wasting time in here.
Hon. Leona Aglukkaq: Thank you, Mr. Chairman. The comments that he has made; that’s done on a regular basis each year.
If that’s done, then how come in a lot of cases things don’t change?
Hon. Leona Aglukkaq: Mr. Chairman, that’s a very general question.
I put forward a budget this year that outlines a lot changes in last year’s budget.
To say that there’s no change, that’s too general, there are a lot of changes.
We have new programs we are introducing this year, there’s new funding for economic development, there’s new funding for health, there’s new funding for hamlets, there’s new funding for a number of different areas.
So, they do change.
We are on (interpretation ends) Finance Branch.
Total Operations and Maintenance. $3,492,000, do you agree?
Turn to page C-7.
Internal Audit Services.
Total Operations and Maintenance. $1,194,000, Mr. Peterson.
The Internal Audit Services Branch I believe is very important division of your department.
I am wondering, when you decide on compliance audits, you describe them as compliance audits in your business plan, when you decide on compliance audits, how is that done?
Are you requested to do that or do you just pick and choose arbitrarily?
Do you have a specific reason for investigating certain areas of various departments?
Hon. Leona Aglukkaq: Thank you, Mr. Chairman. Sometimes there’s random selection of department for an audit.
Other times we get requests from the departments to do an audit, and other times when we hear of things, we follow up through internal audit.
Mr. Peterson: Thank you, Mr. Chairman and I thank the minister.
When you are doing a compliance audit, do you get good cooperation from the department that you are working in?
Usually we get very good cooperation from departments.
Sometimes we run into a few glitches that normally those things are worked out.
How much authority do these internal audit folks have when they go out to a department or to a region to do an audit?
Can they ask for files?
Can they go talk to contractors, vendors, all of those people that do work with the government?
What gives them the authority to get information off people that they are working with?
Hon. Leona Aglukkaq: Thank you, Mr. Chairman. When the member of the audit team goes out and conducts an audit, they have full authority to interview staff, interview non-government staff or contractors, they have authority to access the records, and to also strengthen that process, we are putting together a protocol arrangement that will go to Financial Management Board for approval, again, to tighten up that process.
When a compliance audit is completed, who within the government and external to the government gets a copy of the compliance audit?
The other thing I should mention that internally there’s an Internal Audit Committee to develop the policies as well as the protocols.
That Internal Audit Committee consists of five deputy ministers.
When an audit is completed, a copy of that audit goes to the particular department, the deputy minister of the department to respond and review.
Another copy goes to the comptroller general.
Another copy goes to the Auditor General of Canada.
Has the internal audit service or branch, have any of the auditors ever run into any obstacles or interference or objections to their internal audit work?
In some cases there have been some push backs from that, and we dealt with it recently.
I think the Department of Finance is probably the foundation of the government, and it’s very important that the Department of Finance has the capacity to conduct internal audit services for the government, and hold people accountable to bring some credibility to our financial systems.
I know that in talking to the Auditor General of Canada, she is stressing accountability all of the time, even at the federal level, and it’s very important.
So I am wondering, Mr. Chairman, if there are objections from other government departments to recommendations or conclusions within an internal audit how does the Department of Finance react to those objections from other departments?
In those types of situations, the comptroller general can intervene as well as myself.
Mr. Peterson: Thank you, Mr. Chairman and I thank the minister for that response.
I am thinking that, in my mind and I am sure the minds of many people in Nunavut the buck stops with the Minister of Finance.You are ultimately held accountable for the financial condition and shape of the government.
You have to go into government departments where you have to investigate cases.
You said you had 35 compliance audits last year, 26 for compliance, five were operational, four were financial.
You have 16 in progress, and you completed 13 inquiries.
It’s very important for the openess, accountability, and transparency which were mentioned in November in the Throne Speech.
I am hoping that, as the Minister of Finance, that you receive good cooperation from the other departments when you make your recommendations to do certain things after you conduct these internal audits.
I know you probably have the full support of the Auditor General of Canada.
I believe she is coming up here in April to talk to many of your staff here in Iqaluit.
I know our standing committee has a good relationship with the Auditor General of Canada, and we will be looking forward to seeing her again this year, and talk about some more recommendations from her department.
I just wanted, for the record, to thank the Minister of Finance because that’s where the buck stops.
She and her officials have to hold people accountable, government departments and officials accountable.
She should be given that full support and cooperation from other ministers.
Do you have anything to say Madam Minister?
I would just like to thank the member for his comments.
We do have a very close working relationship as well through the internal audit division with the Auditor General of Canada’s office.
One of the other things we look forward to in April is the Department of Finance is organizing a conference for all financial folks from the department, and throughout Nunavut.
One of the things, during that time, I will be speaking to that delegation on the importance of internal controls, but the Auditor General of Canada has also been invited and she will be the keynote speaker or guest speaker at that conference as well.
That again just goes to show that there is interest in working together with the Auditor General and our finance staff.
I look forward to updating the members on that conference and the outcome of it.
We will take a 5-minute break.
>>Committee recessed at 14:57 and resumed at 15:12
Chairman (interpretation): We are back.
We are on page C-7. (interpretation ends) Internal Audit Services.
I want to make just one comment here.
I am happy to see that there has been an increase in PY’s in this area in the internal audit.
It was an area identified by the Auditor General that needed some work on to help keep departments within the guidelines, and that’s why I tip my hat for that being done.
My question on the internal audit division; how many audits, that they are trying to do five, ten, whatever how many audits are done on a regular basis?
There are 40 on the go this year.
Out of those 40 that have been done or currently in processes, any major issues have been identified?
There has been some.
Hon. Leona Aglukkaq: Mr. Chairman, of the internal audits, there have been some concerns on a number of areas.
One case that I know of, but I can’t speak to all of the details of this in the House, and it’s still being worked on, that was a fraud case.
That’s just one case.
She said there were a number of other areas.
I would just like to get an idea of some of the other major issues besides fraud that have been identified.
Most of the results of the audits’ recommendations are to, again, strengthen financial controls in some areas in training needs of departments that manage finances, but it’s a range of training to improving processes.
Could the minister explain what the results of those findings were, but what were the major concerns that were identified in there?
Were there delays in improper signing authorities? Were there delays in paying northern suppliers?
What specific new types of issues were of a concern that were raised?
Hon. Leona Aglukkaq: Mr. Chairman, I am going to ask the deputy to respond to the details of each report.
I am aware of some of those cases, the more serious ones, but the day-to-day ones, one example that we conducted and we were part of the review process, was with Nunavut Arctic College, and those recommendations were tabled in the House, and that’s again, along training, strengthening internal control, but the details of every report, I don’t have.
The deputy minister can perhaps elaborate more on those.
There were 40 audits conducted during 2004/05. 27 of those audits were compliance audits, where we went in and looked at the extent that departments were complying with all of the financial policies and procedures of government, and there were five operational audits, and eight financial audits.
In all cases, one of the primary focus is to ensure that government assets are being protected, and it might be a physical asset of government.
We can go in and audit safety at an airport or safety at a power plant or safety at a tank farm.
Any case where a problem with one of our assets could be disruptive to the way of life in a community.
It’s important that we go and see that all precautions are in place to protect that asset.
In the vast majority of cases, our recommendations are discussed with the management, and there’s agreement to implement the proposed changes.
Always, there’s follow-up audits to make sure what we recommend is done.
In the case where there’s misappropriation of assets, there can be other actions that come out as a result of that, and in the Government of Nunavut, there have not been a lot of evidence of that sort of activity.
I think there are a lot of cases where departments or individuals don’t follow procedures to a tee, but it’s not a malicious intent involved on the part of the individual or the department.
I think there’s good cooperation, there’s also good cooperation with the Auditor General’s department, as we conduct analysis, and some of our findings get picked up by the Auditor General in her annual report to the legislature.
In these audits, is there any, I guess it gives an insight as to some of the strengths and weaknesses within the, in the most case, you are looking at the compliance audits and the financial audits, and the financial systems within the department and within the government, but is there any particular areas that have been brought to light and any plans overall to try and, okay this seems to be a problem, and if they did 27 compliance audits, and say half of them, this was something that was brought up, and we need to try and address this.
Is there any specific initiative that has been developed to try and address any concerns that you were not aware of prior to these reviews?
The process and procedures in place, I think, are quite strong.
We have the Financial Administrations Act, we have procedures in place to assist departments across the board.
A lot of times, it’s related to training and lack of awareness.
So, when those items are brought forward and identified by the internal audit division, there is contact with each department to improve the process or the training of how to properly report or record or whatever they may be.
But in terms of the process in place of reporting finances of every department, that system is in place, and it works very well, and it’s quite strong.
A lot of times we need to train staff, and it allows consistency in how work is done by departments.