Finance and Government Services - Issue No. 21 - Wednesday, November 21, 2001

2001 Legislative Session: 2nd Session, 37th Parliament
SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES
MINUTES AND HANSARD

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES



CONTENTS

		Page

Expert Witness Briefings		671
	H. Kushner	671
	L. Hubbard	677
	B. Parfitt	680
	R. Patterson	690
	L. Johnson	692
	N. Western	699
	W. Strelioff	704
	P. Gregory	712

Chair:	* Blair Lekstrom (Peace River South L)
Deputy Chair:	* Tony Bhullar (Surrey-Newton L)
Members:	Harry Bloy (Burquitlam L) * Jeff Bray (Victoria–Beacon Hill L) * Ida Chong (Oak Bay–Gordon Head L) * Brian Kerr (Malahat–Juan de Fuca L) * Kevin Krueger (Kamloops–North Thompson L) * Lorne Mayencourt (Vancouver-Burrard L) * Barry Penner (Chilliwack-Kent L) * Ralph Sultan (West Vancouver–Capilano L) * Joy MacPhail (Vancouver-Hastings NDP) * denotes member present


Witnesses:	Peter Gregory (Deputy Auditor General) Lanny Hubbard (Office of the Ombudsman) Linda Johnson (Deputy Chief Electoral Officer) Howard Kushner (Ombudsman) Brent Parfitt (Deputy Ombudsman) Robert Patterson (Chief Electoral Officer) Wayne Strelioff (Auditor General) Nola Western (Elections B.C.)

B. Lekstrom (Chair): Good morning. My name is Blair Lekstrom. I am the Chair of the Select Standing Committee on Finance and Government Services and the MLA for Peace River South. We have been through a considerable process over the last month to six weeks, and certainly one that's been very informative.

We're now on to the second portion of our mandate as a committee, and that is to hear from the statutory officers of the Legislature and have them present their annual reports, performance plans and budgets to this committee for their review. Then we will proceed from that point, so you can be well aware of what's going to take place.

I know we're in a situation where time constraints put on both sides have been very strenuous. I would like to start off by apologizing for the short time frame and notice we've been able to give you for these presentations, but in the interests of trying to move government ahead, I think everybody understands the challenges we're facing today.

Just prior to starting, I would like the other members of our committee to take a moment to introduce themselves, and then we will kick things off and begin our process.

T. Bhullar (Deputy Chair): Tony Bhullar for Surrey-Newton, and I'm Deputy Chair of the Finance Committee.

B. Lekstrom (Chair): All right. With that, Howard, I would like to turn the floor over to you. I believe you will give an overview of your office. We'll go through the information as put forward by our terms of reference. The process we'll follow, once we've heard from you, is if there are questions of members of the committee, I would certainly like to open the floor at that time to address any concerns or issues that haven't been addressed or ones that may need clarification. Our intent, once we have heard from all the statutory officers, is to draft our report and certainly make it available so that you're well aware of what this committee is doing.

H. Kushner: Thank you, Mr. Chair. Good morning. My name is Howard Kushner, and I'm the ombudsman for the province of British Columbia. Joining me this morning are two senior members of my staff. To my left, Mr. Brent Parfitt, the deputy ombudsman. Mr. Parfitt has been with the office of the ombudsman almost since its inception in 1979 and has worked with all of the previous ombudsmen. He was appointed deputy ombudsman in 1987. On my right is Mr. Lanny Hubbard, who is the director of corporate services and responsible for human resources and finance aspects of our office. He's been with our office since 1996.

First, I want to express my appreciation to the Members of the Legislative Assembly, through the committee members, for passing the resolution of August 27 referring the annual reports, performance plans, budgets and business plans of the statutory officers to this committee. In April 1998 the statutory officers issued a special report on the fundamental operating principles and related legislation of the statutory officers, a copy of which was previously provided to you. In that report the officers indicated their view that the annual estimate of expenditures for their offices should be reviewed and approved by a committee of the Legislative Assembly.

The statutory officers are independent officers — that is, independent of government. When asked what that means, I advise people that I work for the province of British Columbia, not the government of British Columbia. I report to the provincial Legislative Assembly through the Speaker. I investigate complaints about the government of British Columbia.

As an independent officer it was felt by the officers that it was not appropriate for us to go through the ordinary government process for ministries to obtain our funding. It could create in the minds of some people a perception of bias, or at least a lack of independence. Some suggested that since the government controls the purse strings, the office might feel constrained in its comments about government because of concerns about the budget. That certainly has not been the case for this office, nor for any statutory officer that I'm aware of. By creating a process that clearly removes the officers from the financial control of the government and puts the control in the hands of the Members of the Legislative Assembly, you have enhanced and strengthened our independence. For that I thank you.

As this is a new process for all of us, I have provided some material to the committee for your assistance. You should all have copies of my 1999 annual report. I apologize that I do not have the 2000 annual report. It's still at the printer's. Unfortunately, it's been at the printer's for about three weeks now, but hopefully it will be out by the end of November, I'm told. I have provided some statistical data for the year 2000. I've provided an organizational chart, our strategic plan for 2001 to 2005 in draft form, an ombudsman information brochure in the various languages it's produced in, a discussion paper on performance measures and our budget proposal. I will discuss this informa-

tion in more detail as I go through my presentation. Should there be additional material which you feel would assist you in your review, I would be pleased to provide what I am able to.

I would like to propose that I spend the first part of my submission outlining the role and operation of our office and reviewing the various documents I have provided. I would like to spend the second part discussing our budget proposal and responding to your questions and comments. However, should you have any questions as I'm going through the material, I would be pleased to respond to them then as well.

This past October we celebrated 22 years of operation of the ombudsman's office in British Columbia. The office became operational in October 1979.

As I indicated in my 1999 annual report, the ombudsman is an independent, impartial investigator of complaints about government administrative unfairness who can, when appropriate, recommend changes to resolve the unfairness. The ombudsman's office provides an opportunity for individuals who feel that they have been treated unfairly by government to bring their complaint to someone who is prepared to listen to that complaint, who may choose to investigate the complaint and who, at the end of the investigation, must make findings and may make recommendations to change or alter a government practice, policy or decision.

The need for an office such as the ombudsman's is widely recognized. H.W.R. Wade, a noted author of Administrative Law, has written:

The Supreme Court of Canada, in a case involving this very office, said this: "The ombudsman's powers of investigation can bring to light cases of bureaucratic maladministration that otherwise would pass unnoticed. He can bring the lamp of scrutiny to otherwise dark places, even over the resistance of those who would draw the blinds."

The term "bureaucratic maladministration" encompasses a wide variety of sins: delay, indifference, rudeness, negligence, arbitrariness, oppressive behaviour, arrogance and unlawfulness. Some of these may be able to be addressed through the courts, often at great expense and over a long period of time. Others may not. Our office offers a relatively quick, timely, confidential, no-charge avenue for a citizen to seek some form of redress. I expect that as MLAs you are also familiar with the type of complaints we receive as you often receive similar complaints, and on occasion your constituency offices will be referring cases to us.

In this province the scope of the office extends beyond the provincial bureaucracy and captures a large number of public authorities which are not traditionally within the scope of the provincial ombudsman's office. We have oversight responsibility for approximately 3,000 authorities. A complete list of our authorities is found in appendix A to the draft Strategic Plan, 2001-2005. I'd like to highlight those, and Mr. Hubbard has an overhead that he can provide as well.

We have jurisdictional authority over all provincial ministries, and that forms about 60 percent of our complaints. We have authority over all provincial Crown corporations — B.C. Hydro, ICBC — which form 10 percent of our complaints. Overall, provincial boards and commissions such as the Workers Compensation Board, the Human Rights Board, the Labour Relations Board and TransLink form about 15 percent of the complaints that come into the office.

These would be what I would characterize as the traditional provincial ombudsman jurisdiction — that is, a provincial ombudsman in every province would have jurisdiction over those matters. There is an ombudsman in every province except Prince Edward Island. Newfoundland has just recreated the office of the ombudsman, and Yukon Territory also has an ombudsman. There is no federal ombudsman.

However, in addition in this province there's been an expanded scope of jurisdiction given. For example, we also take complaints in regard to schools and school districts. That was added to our jurisdiction in 1992 and now forms about 3 percent of our complaints. Universities and colleges, which were added to our jurisdiction in April 1993, form 1 percent of our complaints. Hospitals and health boards, added to our jurisdiction in April 1993 as well, are 3 percent of our complaints. Self-governing bodies such as architects, doctors, teachers, nurses and lawyers were added to our jurisdiction in October 1993 and are another 3 percent of our complaints. Lastly, local government — municipalities, regional districts and local improvement districts — were added to our jurisdiction in June 1995 and form about 5 percent of our complaints.

Thus the concept of a public authority is extremely broad in this province. Our office has the broadest jurisdiction of any ombudsman in North America and, in

my reading of various annual reports, I would suggest the broadest jurisdiction of any ombudsman's office in the world.

Given the broad scope of jurisdiction, we cannot claim to be experts in the various areas and disciplines that we have oversight responsibility for. Instead we are experts in administrative fairness. When we review the actions, procedures, practices, policies and decisions of an authority from an administrative fairness perspective, we are not engaged in the process of second-guessing the authority.

We are not a court of appeal. We look to see if the complaint is being treated fairly, which goes beyond simply a question of whether we agree with the decision or think that it is right. Instead we focus on things such as: have those affected by a decision had a chance to give information and evidence to support their view? Have decisions been made within a reasonable time? Have reasons or explanations been given for the decision or action? Have people been told about any existing appeal or review procedures? Are forms in plain language? Are people treated with respect?

In addition we consider matters such as whether there was a mistake of law or fact. Were irrelevant considerations present in the decision-making? Is the decision or action unjust or oppressive? We point out to complainants and authorities that we are impartial. We are not advocates for the complainant or apologists for the authorities. We determine which complaints we will investigate and which we won't. We determine how we will conduct our investigation, advising both the complainant and the authority that our process is a confidential process, not a public inquiry process. When we accept a complaint for investigation, we say to the authority: "This is the allegation of unfairness. What is your reply or response?"

Although we have the power to compel the production of information and to subpoena witnesses, we rarely need to rely on such powers. Authorities are generally prepared to reply and respond to our requests. The 2000 annual report, which I indicated I hope to have released by the end of the month, provides more details on how our office uses and interprets the act. It will provide further examples of our interpretation of the act and more information for individuals so they'll be aware of how our office operates.

It is to be pointed out, though, that at the end of the day all our office can do is make a recommendation. I cannot order an authority to change its process, policy or decision. I can simply make a recommendation.

Although our process is confidential and the results of our investigation are also not generally publicly released, I have the ability to make the results of any investigation public through the annual report, special report and public reports. When I make a recommendation, or our office makes a recommendation and an authority does not accept that recommendation, we can, if we wish, at that point look to issuing some form of public report. I can go public when I think it's necessary and reasonable.

I have done this once since my appointment in June of 1999, in respect of an investigation of Forest Renewal B.C. and the allegation that Forest Renewal B.C. misinformed or misled participants in a program about the tax consequences of that program. There was a lot of discussion in the press and in the House. There were threats of litigation. We had received a number of complaints. We issued a press release advising that we were looking into the issue to decide if we would investigate, and then subsequently we advised we would investigate it. We started with about ten complaints and ultimately had in excess of 100 complainants come to our office. We've conducted in excess of a year-long investigation, and again, I'm hopeful to release the results of our investigation within the next two weeks.

We receive about 11,000 complaints, inquiries, or requests for information a year. That translates into about 200 contacts or calls, letters, faxes, e-mails or personal interviews a week. We have a 1-800 number so that we're accessible by telephone from anywhere in the province. We have a TTY service for the hearing disabled so that they can contact us as well. We have a website: www.ombudsman.bc.ca, and on that site we have an on-line complaint form which can be sent to us over the Internet on a secured basis. We can receive complaints 24 hours a day, and I assure you we do. In fact, within two hours of our complaint form being on line, we had received a complaint in that form.

We have a nine-person intake team which reviews and responds to the 200 intakes a week, generally within 24 hours of receipt. Approximately three-quarters of the intakes get redirected in some fashion, either because we don't have jurisdiction…. For example, if someone is complaining about the federal government, I can't take that complaint, and we will try to redirect them to a ministry of the federal government that may be able to. Again, I point out there is no federal ombudsman, so there is no ombudsman I can refer them to. It may involve a private business matter. For example, we take complaints about B.C. Hydro and ICBC because they're Crown corporations, but I have no jurisdiction in regard to Telus and can't do anything about an individual phone bill, so again all we can do is redirect an individual to Telus because we have no jurisdiction.

Sometimes individuals are simply seeking information: where they should go to take a complaint that they have against a public authority — and we are aware of the various routes that exist for an individual to take a complaint — or because there is an existing administrative process or an appeal which the complainant can or must access first. That is, if there is a statutory right of appeal on the decision on the merits, then our office is prohibited from accepting that complaint until the appeal has been taken and disposed of or the time to file an appeal has expired.

An example of that is in regard to the Workers Compensation Board, which has a number of appeals structures. Often an individual may contact us initially after they've been turned down or refused in some way by an adjudicator, and we have to redirect them to that

appeal process because we have no jurisdiction to take that complaint. If there is no statutory right of appeal but the authority has its own internal review mechanism, we may request the complainant access that process first before coming to our office.

I believe in and support the opportunity for an authority to comment on or address issues of unfairness themselves before we get involved. In fact, we just recently in September issued public report No. 40: Developing an Internal Complaint Mechanism, a copy of which is in your materials as well.

Thus, of the approximately 11,000 intakes coming in, only about 3,000 or so actually get assigned to an investigator. We have 28 investigators, counting full- and part-time staff. Perhaps a reference to our organizational chart would be helpful. Mr. Hubbard will put that up on the screen.

We have two offices: one in Victoria, one in Vancouver. Here is myself, obviously, at the head of the organization, and Mr. Parfitt, the deputy ombudsman. We have a nine-person intake team counting full- or part-time staff that handle the 11,000 to 12,000 complaints that come in. There are staff in both Victoria and Vancouver. We are able to take in walk-in complainants in either office. We have intake staff in both offices.

We have five investigative teams: a child and youth team with approximately four FTEs, a health team, a local government team, a natural resources team and an Attorney General team. The titles are a little bit misleading, because as authorities come and go and get reorganized, they get reshuffled somewhat under our teams.

For example, the health team deals with the Ministry of Human Resources as well now, dealing with income assistance and disability issues.

The child and youth team deals with all youth-related complaints, whether they come from the Ministry of Children, whether they come from schools or school districts or whether they're dealing with young adults dealing with the Ministry of Human Resources. Our office has been, I think, widely recognized for the particular care and attention it has given to child- and youth-related complaints.

The Attorney General team is actually called Attorney General–plus because it's become the residual that sort of captures a variety of other matters. It also deals with ICBC and WCB.

We have two lawyers on staff, a librarian, a systems team and an administrative team. That is sort of the picture. It works out to 50 FTEs. That has been constant or steady over the last four to five years.

There are two questions I'm often asked about our office when making presentations. First, how many complaints do you receive where you find some form of maladministration? Our process and our statistics don't actually focus on the issue of the number of what one might call valid or meritorious complaints. We find that in very few cases are we actually required to make a finding of unfairness. Often once we begin an investigation, an authority may review its decision or process and be prepared to resolve the complaint without us going any further. Merely receiving notice will often result in an authority reviewing a matter and taking action.

As we progress through an investigation, there may be discussions between our office and the authority that focus on the issues, which also sometimes end up in having the matter resolved. Although we may not make any findings of unfairness, complaints which are resolved due to the actions of authorities often reflect the authority acknowledges some form of unfairness has occurred. Our statistics indicate about 35 to 40 percent of our investigations result in a resolved outcome. On the other hand, in about 25 percent of the cases we make findings that no unfairness has occurred, that the complaint is not substantiated.

Another question frequently asked is: which authorities are the focus of most investigations? Sixty percent of our work comes from provincial ministries; 60 percent of that work comes from the Ministry of Human Resources and the Ministry of Children and Family Development — 36 percent of our work comes from those two ministries. That's not because they act unfairly or have unfair procedures per se, but is more a reflection of the nature of the services they provide and the interactions that occur between them and the public: income assistance, disability benefits, child protection, foster care and youth custody centres.

That translates to about, as I said, 1,600 complaints with Human Resources and 800 complaints with Children and Family Development. I stress that because, as we're all aware, with the government process of restructuring and reformulating government and the services that are being delivered, those two ministries, I expect, will be substantially impacted. Questions naturally arise as to whether or not we will be seeing an increase in the number of complaints coming to us from individuals who feel they've been unfairly treated as a consequence of the readministration or the reformulation of those ministries.

As I've indicated, about 16 percent of our work comes from boards and commissions. The Workers Compensation Board makes up 40 percent of that, and 9 percent comes from Crown corporations. ICBC represents about 55 percent of that 9 percent, and that translates to about 353 complaints.

I'd like now to refer to our strategic plan in a discussion of our performance measures. Shortly after I became ombudsman in June 1999, I initiated a review of the office's first strategic plan, which covered the period 1997 to the year 2001 and was tabled in the Legislature in March 1998.

The draft Strategic Plan, 2001-2005, a copy of which is in the materials we provided to you, represents the outcome of a number of meetings of our extended management team, which consists of myself; the deputy ombudsman; Mr. Hubbard; my general counsel;

We had a number of meetings of extended management and meetings with my staff to go through the draft strategic plan. It has been my approach when developing documents such as our strategic plan and our performance measures to involve all of our staff in seeking their input and suggestions. This sometimes seems to make the process take longer, but the end product is generally much improved and has the support of not only management but of the staff as well.

It is my expectation that the Strategic Plan, 2001-2005 will be tabled with the Legislature before the end of 2001. I believe, in fact, it has been sent off to the printers for printing.

On page 4 of our strategic plan we have a statement of our vision, which has been modified somewhat from the statement of the vision in the earlier, or first, strategic plan but at its core remains the same: fairness and accountability in public administration in British Columbia. That is what our office is all about.

On page 5 we have our guiding principles, again similar to our previous plan, but we've added one more: accountability — performing our duties in a timely, responsive and responsible manner and measuring and reporting on our work.

We have in this strategic plan a mandate that identifies what we do, why we exist and who we serve. We exist, as indicated, to ensure that every member of the public is treated fairly by authorities. We serve the public and the Legislature of British Columbia, and we do it through investigations.

Our goals are thorough and impartial investigations, high-quality service, high morale in the workplace, and education and public awareness. We'll talk in a minute a bit about thorough and impartial investigations, or I have talked about that, and about high-quality service and performance measures. I'd like to take just a brief moment to comment on education and public awareness.

Our office is primarily responsive — that is, we react to complaints as they come in the door. I believe it is also important for both the public and the authorities to be aware of the expectations of our office — what we expect of authorities — so that complainants know the types of complaints they can bring to us and authorities understand the types of complaints we investigate and the standards of behaviour and the administrative fairness of them.

Our office encourages this in a number of ways. We go out and meet with members of the public to talk to specific groups and the public at large about what our office does. That's done by all of our staff. I've gone out, and Brent, my deputy, has gone out. Investigators have been invited out to speak to various members of the public. We go out and meet with authorities to explain our office and what our expectation of authorities is.

We will at times review and comment on proposed policies and practices of an authority, if requested. They will send us the proposed policy they have and ask us to review it from an administrative fairness perspective. We can give them a heads-up about problems or concerns, but I make it clear that it's not a Good Housekeeping seal of approval and that we can still take complaints down the road about that from individuals. We don't sort of give them a Teflon coating on that practice or procedure.

In addition, starting in the spring of this year I began a program of regional visits. I, along with some of my staff, travelled to different areas of the province to meet with authorities to talk about our office — municipal officials, ministry officials, school districts, health organizations. We met with members of the media — print, TV and radio — to talk about our office and what we do. We met with members of the public to talk about our office, and lastly, we set up a mini-intake office to allow individuals to come in and file their complaint in person or talk about an existing file with someone in person rather than over the phone. We went to Kelowna, Penticton, Kamloops, Merritt, Hope, Prince George and Quesnel, three different visits over three months. I hope to be able to continue to do this over the next years and visit other areas such as the East Kootenays, further up-Island and maybe actually get to northern B.C. — appreciating that Prince George, although seen to be northern B.C., is only central B.C.; I lived up in Whitehorse for three years before my appointment as ombudsman and appreciate that Prince George isn't really quite the north everyone thinks it is here in the lower mainland — and would like an opportunity….

It was the first time our office has done regional visits and set up a mini-intake office in at least 15 years, since the mid-eighties under then acting ombudsman Peter Bazowski. I believe those trips were very successful. Although we weren't necessarily swamped by complainants in every locale, there was a very strong interest in learning about our office from the authorities, the media and the public. People generally were very appreciative of us coming out to them.

I think this program is very useful, both in educating people about the office and also in making us — my staff and myself — more appreciative of the issues and concerns facing people in the various areas in which they live. I'm hopeful that in 2002-03 our budget will be flexible enough to allow the continuation of such regional visits.

We have identified in our strategic plan a number of key success factors to assist in measuring our progress towards achieving our goals, a matter I'd like to return to when I talk about performance measures. In addition, in our strategic plan we have identified some core strategies and actions to achieve our goals.

Looking at performance measures and the key success factors, Mr. Hubbard has put up on the overhead our key success factors that we've identified in the strategic plan. We've identified a number of things we think are important for our office to begin to try to measure, such as investigative work, workload, timeliness of work completion and satisfaction with the office, both by complainants and authorities. My expectation is we will be developing a survey over the next

year that we can use to contact complainants and authorities to see whether or not they're satisfied — not necessarily satisfied with the outcome, because obviously we can't make every complainant happy with the result of our investigations, but at least that they've been treated with respect, that they've been heard, that they've been advised as to what's happening on their file as the matter progresses.

Concurrent with the work being done on our strategic plan over the last year or year and a half, I asked Mr. Hubbard to begin to develop some formal performance measures for our office, measures which we can report in our annual report. Mr. Hubbard has produced a paper, a copy of which is included in your materials. That paper has been circulated to our staff, and I've been asking our staff for comment, both on the paper and on the set of possible performance measures identified in there. We have already established some performance measures. If you have an opportunity at some point to take a look at the paper, you will see, for example, that at the back there is a list of possible performance measures that's been circulated to the staff, who have been asked for input. Some we've already done.

With respect to the intake team on page 13 we've established a performance measure of responding to complaints received by Internet, e-mail or mail within five working days. In fact, for the most part we're able to respond to those usually within 24 hours or, generally, at least three working days. When the team was first establishing this, they felt five working days was the target they could try to meet, and they have been meeting it. It's something that will be looked at.

When we take calls on our 1-800 number, people get put into the intake queue. They will then be contacted. We take basic information. They'll not be dropped off that intake queue without at least two attempts to contact the complainant.

With respect to our investigators, once a file has been accepted for investigation, an investigator must advise a complainant within five working days of the opening of that file. We have to maintain contact with the complainant on a basis of at least once every three months so that they're aware of what's occurring on their file.

Of course, the difficulty in developing qualitative as opposed to quantitative measures is exactly that. How do you determine the quality of the work? We can count a lot of things. We have a very sophisticated case tracker system. In fact, the system we developed has been purchased by a number of other ombudsman offices in Canada and the United States as a means of tracking complaints. We can count a lot of things. Usually, what you count then becomes, or at least appears to become, what's important. Your staff knows what you're counting. You know what you're reporting. People focus on that.

It's also important to determine not only if we're being efficient but also if we're being effective. We're engaged in a discussion with our staff to try to determine what those qualitative, as opposed to quantitative, performance measures would be. Of course, some of that can be picked up, for example, in the surveys that may be done of complainants and authorities, seeing whether or not they're being dealt with in a timely fashion and in a respectful way. Some may be to focus on whether or not we've made changes or had an impact on the way the bureaucracy operates — are policies and procedures being changed as a result of our reports or investigations? — and tracking and reporting on that.

We are progressing on the development of performance measures. I hope that next year I will be able to report more fully on our performance measures — those we have chosen — and on our success in meeting those measures.

The last part of my presentation is the budget. This year, as I indicated in my opening comments, the budget process for officers has been changed. Our budget is to be established and set through the recommendations of this committee. Treasury Board is no longer directly involved in the preparation of and responding to our budget submissions.

In preparing our budget submissions for the year 2002-03, I have acted upon certain assumptions. First, I believe that there is a commitment by all members of the House to have an open, transparent and accountable government — perhaps the most open, transparent and accountable government in Canada. The office of the ombudsman is one of the methods accepted in modern-day democracies as ensuring that government operates in an open and accountable way.

Second, this committee has recognized the fact that this government should carry out its actions in a manner that protects the most vulnerable members of society. Our office provides a mechanism for those individuals to see they are being treated fairly. As I've indicated, our statistics in respect of the Ministry of Human Resources and the Ministry of Children and Family Development represents 36 percent of the complaints coming in.

Third, this government is engaged in a substantial reorganization or reformation of government and government services. It is important that people who are impacted by those changes be dealt with in a fair and equitable manner and further, if they feel that they haven't been treated fairly, that there is a place for them to go to raise their concerns and have those concerns considered. Our office is that place.

Fourth, in my discussions with deputy ministers which I have initiated over the past two months, most if not all have recognized that in the short term, certainly, and perhaps the long term, as well, it is likely that the number of complaints coming to our office will increase, not decrease.

Fifth, a number of the initiatives of this government, occurring as a result of the core review, the administrative justice review and the budget review, may well result in some of the existing review processes and administrative tribunals being done away with and, as a result, a corresponding increase and expectancy or reliance on this office to address issues of unfairness

that previously were dealt with by these review processes — in other words, more complaints coming in.

Lastly, our office, I believe, is now operating in an efficient and effective manner. We are doing the right things, and we're doing things right. We have brought in a number of new initiatives or emphasized certain aspects of our work to increase efficiency and effectiveness.

We have twice-yearly full-case reviews of each case with senior management to ensure we are moving cases forward and progressing. We have initiated requirements to contact complainants on a timely and regular basis. We have ensured that closing letters are being sent out on each file, as appropriate, when it is closed. We have initiated a case consultation process with the deputy ombudsman and with the ombudsman to allow difficult cases to be identified and discussed at an early stage. I personally am reviewing and reading each closing letter, approximately 40 or so a week, that goes out from our office. As a consequence, our office is operating in a more efficient and effective manner.

Two years ago, in mid-November 1999, we had 1,381 open investigative files. Last year in mid-November, we had 1,030. In mid-November of this year, we had 781 open investigative files. We've reduced that in two years by over 600 open investigative files, with roughly the same intake coming in — that is, there wasn't a substantial reduction in the intake, but there's been a more effective focusing and conducting of our investigations.

We are closing more files right now than we're opening. We are addressing our backlog. There was a backlog when I came in, and we are addressing that. We're starting our investigative process sooner; we're closing our files quicker. We have reduced the number of files assigned to an investigative officer from 50-plus in 1999 to about 30-plus in 2001, which means they can get to a file faster and conduct the investigation sooner.

That's important, because one of the justifications for an ombudsman's office is an attempt to deal with complaints in a timely, quick fashion, not to have it extend over a long period of time. Some investigations require that, there's no doubt, but other investigations can be done in a short time frame.

We have reduced the number of older files in our office, files that were over a year old. When I came in, we had about 440 files that were over a year old; now we have about 250 or so files that are over a year old.

We've been accomplishing this on essentially a frozen budget. Our budget appropriation has remained at essentially the same level for the last three years. It was adjusted last year somewhat because of the salary increases, but it has been at about $4.7 million. Ninety percent of our budget goes into salary and building occupancy charges. There is very little discretionary spending found in our budget.

I recognize and appreciate the fiscal realities that face British Columbians today. Our office is prepared to act and respond in a fiscally responsible way. We expect a greater caseload to come in the door. We expect that changes will occur which will increase both the number of complaints and the type of complaints coming in. We want to be able to continue to provide a quick, timely and responsive service.

Accordingly, I'm not asking for an increase but am proposing a stand-pat budget: the same amount as we received in 2001-2002, $4.765 million. That translates into a deficit for our office of $216,000, which arises primarily because of salary increases that have been already agreed upon. We will need to manage that, and that will occur presumably through staff attrition, retirement, vacant positions not being filled and a reduction in some administrative costs. A deficit of $216,000 represents approximately three lost positions.

We are looking into the issue of shared services with some or all of the other statutory officers, services such as systems, administration, finance and human resources. Is it feasible? What would the cost saving be if we were able to have common computer systems, common administrative services and finance services? We've established a set of terms of reference, and we hope to begin that study shortly and be able to report back next year on its feasibility.

We have one possible revenue resource that I've referred to, our case tracker system, which is a sophisticated computer program to track complaints. We've sold copies of it to a number of other ombudsman offices — the Alberta ombudsman, the Canadian military ombudsman, the city of Detroit ombudsman office. However, for us to enter into the marketing and distribution business really requires us to have a person designated and tasked with this responsibility. It's been worked off the side of someone's desk. In fact, Lanny can advise us exactly which agency we've contacted.

L. Hubbard: The intellectual property program in the Purchasing Commission went through a call for proposals to see if there was a private sector marketing person that would take it on, and they didn't get any response. Obviously, it's a specialized application. It's not in the realm of Microsoft operating systems. There were three parties that were initially interested, but at the end of their analysis, I guess they felt that it wasn't a big enough potential market for them to invest in.

H. Kushner: We've had, and we still get, calls from various organizations inquiring about the ability. In fact, I think in the last year Ontario Hydro contacted us and ultimately purchased it. That's a possibility, but given the present budget situation, it's not possible for us to devote that resource in order to be able to engage in that business. It's not our business. Our business is to investigate complaints.

For the year 2002-2003, as indicated in the overhead, I'm asking at this time for essentially a stand-pat budget, which represents a loss of three positions to us and a deficit of $216,000, which we will manage. We will find a way to deal with that.

In your letter, which was faxed to the officers yesterday and received in our office yesterday afternoon, the committee Chair asked the officers to prepare a three-year budget plan, service plan and service re-

ports. This has caused some concern and problems for our office, and it also raises the question of the distinction between government ministries and legislative officers and, with respect, begins to possibly blur or miss the importance of our independence.

The government is engaged in a three-year planning process aimed at reducing expenditures and rationalizing government services in an organized, planned way through budget review, core review and administrative justice review. The government has on occasion stressed the importance of dialogue and discussion between ministries as to the impact and effect of those changes.

The officers, and certainly this office, are not part of this general process as it occurs across government, nor should they be. We're not part of government. However, the effect of this significant alteration of government services and policies is likely to impact on our office. The extent and degree of the impact is not known until the government at least reveals its plans, and possibly not even then. It may depend on the execution and implementation of those plans.

Let me give you an example. The Children's Commission is undergoing a core review at the present time, and one of the issues is whether it continues to receive complaints about programs and services of the Ministry of Children and Family Development. We also receive complaints from individuals about the Ministry of Children and Family Development. Suppose the outcome of that process is a decision that such complaints are to be dealt with exclusively by one review agency. If that agency is the Children's Commission and not our office, our workload may be decreased by 700 or 800 cases. On the other hand, if that agency is to be us, with no recourse to the Children's Commission, then our caseload could increase by 700 or 800 cases. Which is it to be? For which contingency should we budget?

The government is engaged in an administrative justice review, which may result in some fewer boards. Will cases which previously went to, say, the Forest Practices Board, the Employment Standards Tribunal or the Workers Compensation Review Board now come to us? I don't know the answer to that question. I suspect this committee doesn't know the answer to that question and, I dare say, at this time, that the various boards, commissions and ministries may not know the answers to those questions.

What about internal complaint-review processes, which our office presently refers people to? There is a sophisticated review process within the Ministry of Children and Family Development: a quality assurance process, which in fact, my deputy, Mr. Parfitt, helped develop. We refer people to that. Will that continue? Will that survive core review, or will those complaints come to us rather than being referred to that internal process?

Our budget plans for 2003-04, 2004-05 are unclear and unknown. For 2002-03 we're asking for a stand-pat budget, which represents about a 4 percent cut — a loss of three positions. The next year will depend on demand. Will it be up or down? Will we have more complaints or fewer complaints? Will the issues be more complex or less complex? Will we be the only game in town, the only external review process aside from courts? As a consequence, I have simply projected for 2003-04 and 2004-05 a stand-pat budget, adjusted for inflation. To be honest with you, I don't know what the impact is going to be over the next two years, and I would want to come back to the committee next year to speak to what the budget should be, based on a year's experience of what has happened as a result of the core review, administrative justice review and the budget review process that has occurred.

To be very frank, it's put us in a quandary. My expectation is that we are going to see a substantial number of complaints coming to us. We're going to see an increase as a result of the processes we are undergoing, and we want to continue to be efficient and effective. I'm quite proud of the fact that over the past two years we have become what I consider to be a more efficient office. I don't want to see longer queues, people having to wait a long time in order for us to be able initiate investigations, but that's the impact of more numbers coming in and us not being able to deal with them in a timely fashion.

That's my formal presentation. I'd be happy to respond to questions or comments.

B. Lekstrom (Chair): Howard, I would like to thank you for what I consider to be a very informative presentation. As you indicated at the beginning of the presentation, it is new for both yourselves and this committee to be reviewing this. I think it was very informative, and I note there is probably going to be a number of questions. We'll go through the process.

K. Krueger: I have several. Thank you very much for the informative presentation. I'm always embarrassed for the government when annual reports come in very long after the year closed. Sometimes it's ridiculous; it's two or three years later.

You mentioned at the onset that your 2000 annual report has been at the printers for three weeks. Is that a performance measurement — when a report isn't published until December of the year following the year that's being reported on?

H. Kushner: Most definitely. We have set a goal to have the reports done within three months. I accept the responsibility. When the report comes out, you will see that it is different than last year's report. It focuses on our legislation and provides an explanation of what our legislation does. It is more than just case vignettes, which our '99 annual report consists of. Hopefully it's a more informative report.

We had targeted to have the report ready for September. That was our target goal. We got working on it in May. We didn't start right away in January. There was part of the summer when some people involved in producing the report were sick. Again, the report is not

I'm embarrassed by the fact that I haven't got the report out. We had it to the printer. It was my expectation to at least have it available today to hand out. I'm advised by the printer that they're having some difficulty doing the printing. The size of it is causing some difficulties with keeping the print on, or whatever, according to the person I spoke to. We had been told that it would take two weeks to have that report out, and it was sent at the end of October. It was my expectation to have the report available and ready by November 15. But it is a performance measure, which we should be measured by.

I was glad to hear you are exploring shared services with the other officers of the Legislature. That's something I had planned to ask you about, as I was listening to your presentation.

You have emphasized the position of the offices in wanting to be independent of government. We all share that desire. When you talked about the three-year services plan, performance planning and so on, you emphasized again that the offices are not part of the government, but we're all still paid by the same taxpayer. I recognize the recognition on your part that that's the case.

Again, something I had planned to ask you about was what collaborative efforts there were with other offices of the Legislature on things like clerical costs, administrative costs, human resources management, finances and those sorts of things.

You said several times: "Our business is to investigate complaints." Clearly it is, and that's what you're good at. The five teams you outlined for us comprise 26.3 FTEs out of 50 FTEs, so a little over half of the people you have are directly engaged in what you have described as your business. The rest are management and support and technical staff. That's not an entirely accurate percentage, I know.

H. Kushner: First of all, I don't think you should ignore the intake staff. Three-quarters of the material coming into the office is dealt with by intake. If we didn't have the intake staff, the investigators would be doing that. I consider that even though they're not doing investigations, they are a fundamental part of it. I wouldn't call them simply administrative support.

I take your point on the others, but I think on intake it has to be recognized that without them…. As I indicated, 200 intake calls come in a week. They deal with three-quarters of those by redirecting them in some fashion. I don't think they're simply what one might characterize as support in the sense of, say, administrative support people doing the financial records or other things.

I take your point that we have a number. That's why we're looking to see whether or not we can have systems people provide support to all of the officers. We have three for our admin support — receptionist.… All of those are areas. It may be possible, for example, to have legal counsel which provides legal advice across the board. I think it is important that we do. But I did want to point that out, because I think, at times, intake is missed. Without them doing the work they're doing, our office would grind to a halt.

I assume that when you do your recruiting for investigators, you're probably getting candidates who are already skilled in word processing and keyboarding — things that governments didn't used to recruit for but these days are pretty much expected. Again, looking at the organizational chart, I was thinking if I were a manager of this organization, faced with the sea change you see going on in the B.C. government, I'd be having a really hard look at the whole structure. My focus would be on the essential nature of the job of the office, which you've described as investigating complaints.

I'm not presuming to micromanage the organization; it's our job to question these things. It struck me that it looks a little heavy in management, and it looks to me as though there might be savings in administrative and support staff. Our target for government, recognizing you're not part of government but nevertheless paid for by the same people who pay for the government, has been a reduction of cost of 10 percent on average. I'm hoping, as you make those decisions you alluded to earlier with what you referred to as the $216,000 deficit, that you can have a look at some of those things with a focus on what your key outcome is, which is to process the complaints promptly and thoroughly. Just a suggestion.

H. Kushner: I take your comment and would say that in fact our office is engaged in that process. We are looking at ways. For example, I was in various government positions before I became ombudsman. I was with Alberta Justice as a director of legal services and with the territorial government in the same position. This is the first office I've been in where the introduction of computers has in fact resulted in fewer administrative support staff. My experience when I was dealing with lawyers in Alberta Justice was that every lawyer got a computer, but they still needed to have admin support to produce things.

In this case, the investigative officers make all their own case notes into the case tracker system. That's an expectation. We expect when we hire them that they have those skills. They all have computers on their desks, and I was very impressed when I came into the office that this was an office where in fact these individuals were using them. There wasn't the expectation. They produce their own letters to send out. We have the admin staff doing primarily finance matters. I think it's the CHIP system that you have to be into to make sure we get paid. We have a receptionist at the front.

I take your point. That's why we're looking at whether or not we can find those shared services. Each of the officers does have special reasons for there being established and goals and objectives. If we can find

common areas that can allow us to reduce those other costs, then I think we're all in favour of that.

B. Kerr: I haven't read the Ombudsman Act so this might be a rather naïve question, but I'm just wondering: is there an opportunity for the number of complaints you take in for a deposit to be taken — a refundable deposit or some form of cost-recovery for some of the cases you take on? The reason I'm saying that, of course, is that if you're getting 11,000 complaints, a lot of people use you as their first resort as opposed to the last resort.

H. Kushner: Of those 11,000 we generally, as I say, provide the information as to where they ought to be going. So three-quarters of those generally get redirected in some fashion, and that generally happens quite quickly. The concept of our office has always been one where it is a free service or a service where there is no charge to the public. Obviously it's not free, because money comes out of the consolidated revenue fund to fund the office.

I think there are concerns that where one imposes a cost charge, even if it's one that can be a returnable deposit, that would discourage some groups or individuals from bringing their complaints forward. We get people calling us saying that they've not received their income assistance cheque for this month. They have nowhere to go. They're phoning us from a pay phone on the street. We'll try to deal with that right away. I'm not sure that is consistent, maybe, with the philosophy behind it. Maybe the deputy would want to speak to that, with his experience.

B. Parfitt: Yes, I would, Mr. Kerr, and with respect to the matter of costing out, too. We are the court of last resort. If there are alternative remedies, we are obliged, where they're statutory, as the ombudsman said, to refer individuals to them. In fact, we have no jurisdiction until those rights are exercised. In addition, however, we have discretion not to investigate where there's an alternative remedy. That may be quite informal; it may not be statutory at all. In some instances it may be a complaints officer within a ministry that we refer an individual to and say: "Go there first. If you're still not satisfied at the end of the day, you can come to us."

That's one of the functions of our intake staff, to be aware of all those referral mechanisms, so when somebody does phone in and say, "This is our complaint," our intake staff will say: "Have you gone to so-and-so and so-and-so? These are the remedies available to you. If you've exhausted them all, then you can come to us and open a complaint." But there definitely are individuals who come to us in the first instance and say: "You look after the complaint." We'll say: "No, we can't do that. We won't do that until you've exhausted those remedies."

The other point, I suppose, is that as mentioned before, people who come to us are generally in very vulnerable situations — children, people on income assistance, and so on — and are little able to afford the actual costs of our office.

I. Chong: Following up on those comments, Mr. Parfitt, about being the office of last resort, I'm looking at your 1999 annual report and at a number of case summaries here. To be fair, I've handled maybe half a dozen cases of similar nature — not that I'm asking you to refer cases to MLA offices. The examples you cite in your annual report would appear to be, I guess, minor cases. If that's the common practice, I would suggest there's an opportunity there to have a look at what information your intake officers are requesting from the people who come in. I would expect your intake officers need to refer cases to your investigators that are much more in-depth than some of these, and if it's taking up more time, I don't necessarily believe it's a good use of their time.

B. Parfitt: We certainly have discretion not to take complaints if they tend to be frivolous or vexatious. And if there are alternative remedies that are far more appropriate, we try to do that. We also get a lot of complaint referrals, though, from MLA offices, because they don't want to be involved with them, and we do get involved as a necessity.

I. Chong: I've heard of those too, and I've also heard of people coming to my office when they haven't been able to seek assistance through your office.

I wanted to follow up, as well, on some financial matters. Mr. Kushner has already indicated the delay in your annual report release, and we certainly hope your 2001 report is much more timely. It's really of less value when it's 11 months after the fact that we're able to have a look and to help you implement any changes you need.

Regarding the recommendations and the changes you say you make to government, have you tracked the recommendations you've made for changes to government as to the success of those being made? In other words, have you said that in an average year you've made 45 or 110 suggestions to government and at the end of the year you've seen that none of them have been acted upon? I'm questioning the time spent and the value of doing that if in fact you don't see any results.

H. Kushner: I guess I would say it the other way. We generally don't comment on it, because it happens all the time. When we comment, it's usually because, in fact, an authority isn't prepared to accept our recommendation or change its practice or procedures. As a general rule, when we talk about resolved cases, those resolved cases many times involve changes in practices and procedures.

I'll take your comment as a suggestion. It may be that we ought to be reporting on how many changes have occurred as a result — maybe state the successes more clearly. One of the concerns, of course, is that we don't want to be in a situation where authorities feel we are somehow trying to make them the fall guys in

our report. We rely on our impartiality being seen on both sides, so we don't tend to point out faults per se.

I must say that we're a successful organization — that is, when we make recommendations, they generally, 99 percent of the time, are accepted. It's the ones that aren't that we end up reporting on. I have the ability to go public, and I haven't gone public in two years, which speaks to the fact that we have been successful. It's certainly something we've looked at — how many changes to practices, procedures and policies have occurred.

That may be a performance measure we want to use in order to indicate we are successful in seeing changes. We have engaged in systemic investigations at times when we see a similar complaint coming in repeatedly. I'll give an example: a situation dealing with a correctional centre where an inmate claims some of his personal belongings were lost. We can take a look at that one complaint and investigate it. Another one comes in and another one and another one. We might say that it looks like there's a real problem here in how the centre protects or looks after personal belongings of inmates. We may do a systemic investigation.

One of the things I'm considering is reporting separately on our systemic investigations, which have what I would characterize as a longer sort of impact in the sense of dealing with a broader problem. We've done that. Those, unfortunately, generally take up substantial resources. You're away from that individual complaint, and you're now looking at a broader issue. We've done things like that. We issued a report, just before I came board, on the Workers Compensation Board ombudsman. There's an ombudsman within the Workers Compensation Board. We did that sort of systemic review.

I. Chong: On that particular issue — I'm aware of the WCB ombudsman — do you find your two offices work at cross-purposes, or do you work in conjunction with each other? MLA offices often get complaints about WCB cases, sometimes as a last resort. We refer them to whatever appeal process, as well, and then the ombudsman, and then they go to your office. I'm wondering if they're not going through a rather circuitous system.

H. Kushner: We've had concerns. We issued a public report on the Workers Compensation Board ombudsman and changes we thought would be necessary in order to make it either more effective or more like an ombudsman's office. We have concerns about the fact it's called an ombudsman when in fact it may not have the necessary indicia of an ombudsman's office. We've entered into discussions with the Workers Compensation Board, the chair of the panel of administrators, and we will be having discussions with Mr. Hunt and Mr. Winter in their review of the WCB for comment.

I also wanted to get back to the comment about MLAs. Ombudsmen and MLAs at times do similar jobs. You get similar sorts of complaints. There are differences as well. Sometimes individuals come to our office because they're concerned that an issue may become a political issue if they take it to an MLA. Sometimes they know we have the ability to access documentation that obviously an MLA can't. There are different routes, and I think what's important is for people to know the various routes they can take. They can go to court sometimes; they can go to the press; they can go to the MLAs.

We will be doing a presentation to the constituency assistants in January about our office and how we operate so that there is that familiarity. I'm more than happy to appear at any time before a group of MLAs to talk about our office — how we operate and what we do.

There is a similarity, but at the same time, there are differences between the two offices. I guess one other is that some of the complaints we get, people would say that looks sort of silly or a waste of time, but I think to some of those people who bring in those complaints that those are very important complaints to those individuals. We've had cases where people say they've been dealt with rudely over the telephone or been dealt with disrespectfully, and you might say: "Well, you know, that just happens, and those people don't care; why should our office be looking at that?" Treating people with respect is an important aspect. I agree that the complaint itself may look as not being particularly significant in the overall scheme of things, but for our office, which is there to deal with that individual and his feeling that he's been unfairly or unjustly treated, I think is very important.

I. Chong: Thank you. I've got a few more questions. I don't want to take up too much more of the time of other members for their questions. Maybe I'll just lay them all out, and you can answer them. In terms of the size of your office in comparison to other jurisdictions, would you say that 50 FTEs looking at 11,000 intakes per year is sort of on par or on average with other jurisdictions? That's one question I had for you. The other was about your FTEs that provide legal advice. I'd be curious as to what kind of legal advice your office provides. Why do you have a legal team?

Thirdly, is this the first time in 22 years you've actually sat down and developed, I guess, performance measurements, targets and outcomes? Had you done them in the past? We haven't heard too much about that until now. Finally, about your files, your cases — some of which are five years old — whether one of your performance target measurements in the future will ensure there aren't too many that are five years old. I'm curious how a case can be five years old and still have effectiveness. What steps are you taking to reduce that to what you would consider a reasonable level? Those are my four questions.

H. Kushner: Let me deal with the size issue. We're the third-largest ombudsman's office. Ontario and Quebec are larger in size. Quebec has in excess of 80 FTEs, and Ontario about a similar amount. It's hard to measure from province to province what people count.

In fact, I participated in a presentation. The Canadian ombudsmen try to get together on a yearly basis. We had a conference this year in Quebec City. One of the discussions was: what are we counting? People count different things, so it's a little hard at times to look at numbers and ask if we are counting the same things. We count investigations, someone else counts intakes, someone else counts telephone calls, etc.

I would say that for the size of the office, I think we correspond to the nature of the number of complaints coming in. For example, Ontario has a higher count, but if you look at that, they have 12,000 or 13,000 — I can't remember the number — complaints coming in from correctional centres. We don't have that volume of complaints coming in from correctional centres, plus there is an existing complaint resolution process that we direct inmates to go through. We are reflective of the size, plus I think we do have a broader jurisdiction than all the others.

Legal advisers. One of the questions we have is whether or not we have jurisdiction in order to initiate an investigation. We deal with administrative unfairness. Questions arise as to whether or not the issue is an issue of administration. Often, particularly dealing with municipalities, they will pass a bylaw and say they've engaged in a legislative process, so we have no business looking at that particular matter. We've certainly never taken the position that the form determines whether it's legislative or not. We have to look at whether or not it is in fact administrative, so they often have discussions. They also have discussions about whether or not a particular complainant is an authority. Is it a matter within our jurisdiction or not within our jurisdiction?

In addition, a number of our authorities have lawyers. When we initiate an investigation, sometimes it's not uncommon for them to end up with a letter from their lawyer saying, "You don't have authority to deal with us," and we end up in a discussion. We sometimes find that we need a lawyer-to-lawyer discussion in order to get through the barrier the authority has created.

Performance measures. The office didn't have any formal performance measures. We've reported on statistics all through the 20 years. I came on board in June, and in September of 1999 — you can ask my staff — I told them we were developing performance measures. I had been with the Alberta government and developed performance measures for the lawyers within the legal services in Alberta. I initiated the first survey of clients for Alberta Justice that we'd ever done before. I think you can imagine the lawyers were somewhat reluctant to have that. It's the same sort of concern: if they don't like our advice, they'll give us bad comments on the survey. That wasn't the case. I've been interested and concerned about performance measures since I started with the office. Some we've already implemented.

I also believe it's important in the development of performance measures that your staff participate in that process, that it not be simply something imposed from the top down saying that these are what they shall be. We've had that. I've certainly had that interest. We've certainly reported on our statistics about some of those: the volume of cases, the way they've been closed, the number of intakes. Those are consistent within our annual reports from day one. Those are types of performance measures, so those performance measures are there.

Lastly, with respect to old cases, I agree. We try to set a performance measure that 85 or 95 percent of our cases are resolved within one year. Some of them do take time. Sometimes it's because there are ongoing discussions between the authority and our office and the complainant as to what a satisfactory outcome is. In my view, it's more useful for our office to try to develop an outcome that is going to be satisfactory to both the authority and the complainant than simply coming out with a recommendation the authority can't implement, or alternately, is not acceptable directly to the complainant. So it sometimes takes a long time.

We are focusing. Our numbers on older cases are coming down. We have in the package an indication of that. You can see our numbers are coming down. In fact, if you notice, at the present time we have 206 cases in that one-to-two-year-old category. Over a hundred of those represent the Forest Renewal B.C. investigation, which I indicated is at the stage where it's gone and should be released within the next two weeks, so that number will come down by over a hundred. If you take the older cases — the five-year-old cases — we've gone from ten down to five since 1999.

We focus on those in our case review. I agree with you. We should be getting through as quickly as possible. That's one of the reasons for having our office: that we be timely and responsive. I guess I had the same question you did when I came on as ombudsman: why do we have these? We initiated those case reviews, and the focus in much of those case reviews is on the older files and saying: "Let's make sure we're doing something on those files. Is there activity occurring on those files? What's going on in those?" I agree on that.

I. Chong: Thank you. I'll just leave you with a quick comment, not necessarily a question that I need you to answer today. Coming from an accounting background — and my colleague Mr. Kerr was probably alluding to this as well — in measuring effectiveness or efficiencies with your investigators and cases, have you ever considered a system where you would track the hours they work on cases of a similar nature? I'm not saying that would necessarily prove useful; however, it could be you were finding that on average certain cases of a similar nature were being handled by some caseworkers in a matter of hours where others were taking weeks. It could highlight some weak spots where perhaps you could change caseloads onto those that had more propensity to deal with them in a more effective way. Just a thought for you to consider.

H. Kushner: Yeah. I appreciate it. I would say, in fact, that we are in the process and do do that. We don't

report on it that way, but obviously I think that's something an effective office ought to be doing.

B. Penner: In this discussion concerning a comparison between what your office does and what a constituency office does, I'm reminded that I frequently tell people that the MLA's office is the ombudsman of last resort. It's not entirely uncommon to have people come to the constituency office who have not been able to get their problems dealt with to their satisfaction by the ombudsman. That's not necessarily a reflection on the ombudsman but more the nature of the concern.

I have a couple of different questions, if you'll bear with me. First of all, in this discussion about your annual report being sent to the printer and the printer not having it done in the time indicated, can you tell me whether you're referring to Queen's Printer, and further, does your office have an option as to where your various publications are produced? Can you go to the private sector? If you do go to the Queen's Printer, are you levied a charge against your budget for the cost of those materials? If so, what is your total budgeted cost per year for printed materials? That's my first question.

H. Kushner: I might direct that to Mr. Hubbard, who's our chief financial officer, and he can respond to at least some of those.

L. Hubbard: As far as the requisitioning of the printing, it's through the Queen's Printer, but depending on the nature of the job…. In the case of the annual report, it has been tendered out to a private sector printer — in Kamloops, I believe, in this particular case. Queen's Printer will normally get two or three bids. If it's a very small job, they tend to do it in-house. It depends on the colour and the nature of the printing job, as well, so there are a number of factors that go into it.

As to whether we're levied the charge, I'm not aware that we're levied any surcharge per se, if that was your question, through the Queen's Printer. We make the request for the printing services through the Queen's Printer.

L. Hubbard: That's right. The invoice will come through from the private sector to the Queen's Printer, and then we pay the Queen's Printer.

L. Hubbard: It varies quite a bit, depending on the number and size of reports that are produced this year. The annual report that's at the printer this year is about twice the length of the '99 one you have in your package, plus we have a number of special reports coming out. Our printing costs in this fiscal year are going to be in the order of $30,000, depending on the number of reports we produce and the number of copies. Last year — and I'm going by memory now — it would probably have been in the order of about $10,000.

B. Penner: I notice your office prepares a number of different publications, so when you say $30,000 a year, does that include all these little brochures and other documents?

L. Hubbard: It would, yes. Those brochures are actually very inexpensive to produce, compared to the reports. The brochures were updated this year. There were original brochures that had been around. Mr. Parfitt might remember when those were prepared. It was certainly before my time with the office. We updated them all this year.

B. Penner: Mr. Kushner, you talked about the challenges of dealing with wage increases this upcoming fiscal year. Can you tell me what percentage increase is confronting your office?

H. Kushner: The percentage increase for the coming year, just by the salary awards that are coming into effect through the contracts previously negotiated are 2.5 percent across the board. In addition, there's a salary increase for the ombudsman. The officers' salaries themselves are tied to the chief provincial judge. I'm not sure what the percentage is there. That was a separately negotiated item.

In addition to the percentage, of course, what flows automatically is the benefits chargeback vote, which is 20.5 percent of salaries. When you add that to the cost, it roughly takes an automatic salary increase up to about 3 percent. It affects 3 percent of the salary budget.

B. Penner: You indicated in your initial presentation that the federal government does not have an ombudsman and that, I think, one other province doesn't have one — Prince Edward Island. In those jurisdictions, including the federal government, how do they handle the kind of work you do? What happens? How are they able to survive without the office of the ombudsman?

H. Kushner: They're able to survive. I guess the question is whether they're able to survive well. Are their complaints being handled? We get complaints coming in from people saying they feel they've been unfairly treated by the federal government.

The federal government has some specialty ombudsmen. They have a prison ombudsman, a correctional ombudsman who takes complaints from correc-

tional. They focused on establishing what one might call specialty. They have a language commissioner who deals with complaints about language. They have a military ombudsman, but interestingly enough, the military ombudsman takes complaints about the military only from the military. Members of the public can't take their complaints to the military ombudsman.

They have at times attempted to achieve it by creating some specialty ombudsmen rather than a general, universal ombudsman. They have some internal complaint resolution processes within ministries, which are not independent and which do not give the individual that second independent and impartial view of the matter. We have met with federal officials and have talked to them about establishing a federal ombudsman and obtained, I think, some acceptance of the idea, but it has never yet translated into creating one.

A former ombudsman from this province, Stephen Owen, is now a Member of Parliament and a strong supporter of the concept of an ombudsman. I know he's making representations to the federal government about establishing such an ombudsman.

Newfoundland had an ombudsman and did away with it. One of the first actions of the new government just elected was to re-establish an ombudsman. Obviously they felt it was important there be some mechanism to deal with these complaints.

B. Penner: You indicated that if you were given a stand-pat budget, you'd have to reduce three FTEs. Have you identified in your own mind what positions would be eliminated? I'm not asking you to say here, but have you already done that work?

H. Kushner: Senior management has sat down and identified…. Part of that may depend on what was recently announced by way of the retirement and separation packages. There may be individuals on staff who are now able to take advantage of those opportunities. We've looked at those opportunities and have identified where we would look. It also depends on what level. I mean, if we're looking at admin support, we need, obviously…. For $216,000, essentially, we have to talk about to get there…. We obviously need to do it by having the investigators do it. I would say senior management has certainly looked at how that could be implemented.

L. Mayencourt: Thank you, Mr. Kushner. I want to go back to something Ms. Chong was talking about. I take it from your presentation and from my understanding that one of the chief goals of the ombudsman's office is to provide fair treatment for all the citizens of the province.

As Ida mentioned and as will probably prove out if you've got your complaint tracker working properly, there are going to be several systemic patterns that develop around ministries, and so on. I want to ask you to what degree are you mandated or allowed to say to a ministry: "Look, you've got a serious problem here. You're being unjust in the administration of your policies to a whole sector of the community. What are you going to be doing about it?" To what degree do they have to respond and say: "Yes, we're going to fix that problem"? Then, also, to what extent should you be able to do that as the ombudsman?

H. Kushner: Under the legislation not only do I take individual complaints but I have the ability to initiative my own investigations. Generally, that's how a systemic investigation gets initiated. We are receiving information from a variety of sources. For example, the investigation we initiated with respect to Forest Renewal B.C. arose from the fact that we had some complainants calling us, there was a discussion ongoing in the newspaper about people who felt they had been misinformed by Forest Renewal B.C. with respect to the tax consequences of this program, and there was discussion in the House. All of that said to me: "That's a type of issue that our office is set up to look into." I initiated that investigation, and we're at the stage now, as I say, where I hope to be able to report out on it.

Once I initiate that investigation, it's as in any other investigation — that is, the authority has to respond to us. Sometimes — and that's maybe where the lawyers come in — we get responses back saying: "Why are you doing this? You don't have the authority to do this." We point out to them that, in fact, I do have the ability to initiate those sorts of investigations on my own. We have the ability to subpoena documents. Coming out of that investigation we can make recommendations if we think changes are required and then expect the authority either to respond before we end our investigation, or sometimes we report that the authority is looking into the matter further, or whatever.

I have that ability, and we've done it on a number of occasions. Generally, those large systemic investigations often end up being reported on either in the annual report or in its own separate report. We did an investigation into the Workers Compensation Board ombudsman. We issued a report on that. We did an investigation into the treatment of the New Denver Doukhobor children. We issued a report called Righting the Wrong. Interestingly enough, that report was issued before the authority ended up having an opportunity to provide their full response to us. We're monitoring that, and I expect to be reporting on the outcome or where that is at. That's another matter.

So we have the ability to do those systemic investigations and to report out on them. It's as if it's a regular investigation in the sense of all the powers our office has. We are able to make recommendations to an authority and report on whether or not an authority is prepared to accept those recommendations.

B. Parfitt: If you look at the special and public reports on our website, you'll see that the majority of them are systemic in nature and affect a number of individuals.

L. Mayencourt: It occurs to me that one of the goals of the ombudsman should be that you're working your way out of a job. In other words, if you fix the systemic problems, we should need you less down the road.

I look at the report here, and of the three reports you just noted, one of them was accepted and acted upon, and two have not been to date. Yet they come from January, May and April of '99. We're a couple of years later already. That's just an observation. I invite you to comment on it, if you'd like.

I want to ask a specific question about something that affects a number of people in my community, and that has to do with the Ministry of Human Resources. Over the course of three and a half years, they had a benefit people could apply for called schedule C. In the course of those three years, some 500 people went through basically a cookie-cutter type process of being denied by the ministry, going to a tribunal, going to appeal and having the ministry respond almost in the identical words in all of those cases. In all of those cases, those people who made the initial application were awarded the benefit. What happened was that 500 people went through agony, and nothing really happened with it.

I know that your office was informed of this. I wonder if you could comment on when you were first informed and what action you took to deal with it. I know it was resolved by a change in how we administer that as of last month, but what did you do about it? How much work did you put into it? Where did you get when you talked to the ministry, and how could it be done better?

My last question to you on this item is when you talk about the lawyers that a ministry puts up as a roadblock to you doing your job, who's paying for the lawyer they put up, and who's paying for the lawyer you put up?

H. Kushner: Let me answer the last question first, which is about the lawyer. Obviously, the ministry's lawyer is generally paid by the ministry or by the Attorney General's department, if they have that, or by the Crown corporation, if it's the Crown corporation. Whatever the authority is, either they have an in-house counsel, or they may rely on outside legal counsel in order to respond to it. It comes out of their budget in whatever way the budget for that authority is paid for. Obviously, ours is paid through the course of our budget.

As an aside on that, I don't want to be too harsh on those people. When I was with Alberta Justice representing the government of Alberta, one of the roles I played at times was legal adviser to the government in responding to ombudsman complaints. I often sat on the other side of the table on some files. I can understand at times why some issues are being raised in that context. I'm aware of the issues on both sides of the table on that.

With respect to your second question, I would want to say at this stage that I'm aware of the issue. Confidentiality provisions within my legislation preclude me from getting into a discussion on particular cases and particular matters. I would be happy to meet with you to discuss the matter further, if I can get approval from the complainants to do that, because that's our basis for being able to.

That's a bit of a common issue at times, not just with that but generally. If we get contacted by MLAs and they want to discuss a file, we require a waiver of some sort from the complainant saying that it's okay for us to engage in that discussion. It's the confidentiality provisions of the legislation.

I can say I'm aware of that investigation; I was aware of the matter. It is an illustration of a situation where one would say that yes, there is a concern, because there appears to be a uniform response occurring, it might seem to suggest there was an unfairness involved.

L. Mayencourt: I understand the bit about confidentiality, but the reason I know it's a cookie-cutter approach is that all of those appeals are posted on the Web — minus the names, of course — so there really isn't any requirement for us to discuss an individual case. We've got 500 where they've done the same thing over and over again.

My point is: at what point does the ombudsman step in and say: "You know what? This is a fundamental injustice. You guys have got to clean up your act. If you don't do it, you're going to have 500 complaints that you're going to deal with, and we're going to need more money to budget for you next year."

I think underlying all of this is that your goal is to find fundamental injustice in the administration of policies and procedures for Crown corporations and whatever else. If I look at your annual report, and I'm using Ministry of Human Resources — or, as it was known then, Ministry of Social Development and Economic Security — they comprised 36 percent of your complaints. The next one down is WCB, and the next one down is ICBC. If you're tracking all that stuff, you know who the bad guys are in this. You know that it's time to tell them to clean up their act. How much more do you need to do? If you're not going to….

H. Kushner: But we do. I guess what I'm saying is that when we do identify those issues, we can act either because individuals or groups bring them forward, which is how some cases get started, or we've identified through our practice a concern about it. We do initiate those systemic investigations when they come to our attention through ongoing investigation, which identifies this is happening in three, four, ten, 20, 30 or 100 cases and causes us some sort of concern. We do that. I don't want to leave the impression we don't. We actually do engage in that process.

Obviously, we don't prejudge the outcome of the investigation and what's going to happen. When we see something like that, what we do is say: "Well, this causes us some concern. What do you have to say to it?" You have to appreciate there are at least two sides we're going to hear, if not more on occasion. We do that sort of investigation.

As I say, I think one of the issues we're looking at is whether we want to report out separately on some systemic investigations. We generally report out the large ones in some sort of public report. We do some that aren't as large as that, but it may be warranted to have a separate report of systemic investigations rather than the annual report, which tends to focus on the individual complaints and what has occurred as a result of those.

Again, I'm limited by what I can disclose, but I can advise we've been involved in cases where, in fact, we think our involvement has resulted in court cases being settled or resolved because we've come forward and said that we think that there's an unfairness here that goes beyond any legal unfairness. Even if the court case may be resolved in favour of the authority, that still may leave an administrative unfairness, and we're still going to be around, even if that matter is dealt with in court. They might want to consider, as part of their decision as to how they're going to deal with this matter, whether or not they really need to go to court, because they're still going to have us to deal with — even with the outcome.

We've had situations where matters have ended up being resolved, even though lawyers will often say someone is taking that to court, so we ought not to be doing something. At times we'll say that the issues that we're looking at are larger than the issues that are before the court.

L. Mayencourt: The last thing is on the annual report. I sympathize with you. I've had lots of experience getting the print job done late and whatever. This is a comment. I receive an enormous amount of annual reports from everybody in the province. I don't know why they want us all to have every one of them. I just keep looking at them and go on that an annual report, when I was running a little non-profit agency, was three pages.

I look here, and there are 32 pages of case studies and three pages of statistics that are valuable and useful. This year your annual report is going to be twice the size. That means it's going to cost a little bit more. I don't even know how many people read these things. I think it's important to state what you do, but I think your statistics tell us that. I would just encourage you and other government agencies to…. Maybe Ford Motor Co. and Weyerhaeuser can afford these things, but British Columbians can't.

H. Kushner: I guess, Mr. Mayencourt, what I'd like to say on that is that my only way to report on what I do, formally, is by way of my annual report. I do not engage in a public process. I don't want my name in the newspaper. I don't encourage that. So then all of a sudden people start to say: "Who's the ombudsman? What's he doing? He doesn't do anything." That's success, because I don't want to be in the press. But my only way of reporting on things occurring is by way of that annual report. That's my primary mechanism by which I can make the public — and you, as my employer — aware of what I'm doing.

I think it's extremely important to have an annual report that is not simply statistics. I think those case vignettes are what people read, and we get those back.

This year I made a conscious decision to provide an annual report which talked about our legislation and how we use that legislation. I guess I could say I'll issue a public report instead and do that, but I thought it was important to let the people I'm working for and the public of B.C. know how we use our legislation and provide that legislation.

With respect, I would disagree with you on the issue of the annual report. To me that is maybe the most important document that comes out of our office in any year. Therefore I take pride in that. But also, it's my only way of being able to report on a variety of issues. I would hope that in the course of all those reports — and I appreciate you get many….

The officers work for you, so the reports you will read carefully over the next years will be those seven reports that come from the officers who are, in fact, working for this Legislature — not for the government, where many of those reports are, but working for the members of the Legislature. It's our opportunity to look at that and comment on it.

B. Lekstrom (Chair): We are quickly running out of time. Actually, I do have Joy wishing to ask some questions next.

J. MacPhail: Thank you, Mr. Kushner, and your team, for making the presentation. You are in a unique situation of budget deliberations being on the record, so it will prove interesting reading for the public.

I know you're subject to legislation that's decades old. It certainly is an indication of a mature democracy to have an ombuds system. I have experienced the tough love of your office, as a former minister, but it has always been valuable advice — tough in some situations, but I have always worked for ministries that have acted on your advice.

Second, while MLAs do perform a community service, we are under no legislative obligation to do so. That's where there's a difference with your office, where you have a legislative obligation, so you do need resources.

However, not being a member of the government, I don't exactly know how the rest of the budget is being determined, except through what appears in the media. It seems to me that other government-funded agencies are being asked to prepare scenarios that show a 20 percent, 30 percent and 50 percent reduction in their budgets. Have you had any indication that you would be asked to do so?

H. Kushner: We've received no budget instructions whatsoever. Treasury Board had advised that we are not part of their process. Whereas in past years when we might have received instructions from Treasury

Board, they have said to us, in any discussions we have had, to speak with the committee — that the committee is in charge of the budget process and deliberations. So we've not operated under or received any instructions from Treasury Board in regards to our budget or budget preparations.

J. MacPhail: I listened with interest when you said Treasury Board. This is the first time Treasury Board won't be involved. It's your understanding that the decisions around your budget will be made here.

H. Kushner: My understanding is that this committee will make a recommendation to the Legislative Assembly Management Committee with respect to our budget. That's what my understanding is of the process.

J. MacPhail: That's fair enough. I'm not trying to cross-examine you; we're both learning about this. Everybody's learning about it as they go along.

In the issue of your office, I note you have a team for local government and a health team. The government of the day is on record that there will be changes to the way municipalities govern themselves through their community charters. They're going through an exercise. Have you been asked for your advice on the community charter?

H. Kushner: We've not been asked directly for advice on the community charter. Our information on that comes, presumably, in the same way you receive information about it. My understanding is that there's nothing in that legislation that discusses the office of the ombudsman or the requirement.

For example, some suggested maybe municipalities should establish ombudsmen. On that point, if I can just make an aside, only Manitoba, Nova Scotia, New Brunswick and us have jurisdiction over municipalities. Most provincial ombudsmen do not have jurisdiction over municipalities. I must say, when I first showed interest in this position and applied for it, I was surprised to discover the broad scope included municipalities. Again it's important, as part of letting people know that our office…. I don't think people would think a provincial ombudsman would normally have that sort of jurisdiction.

J. MacPhail: Right. While you listed other changes which may occur in government that could put pressure on your office, I think this is one area you'll have to watch very carefully as putting extra pressure. The indication of the community charter — certainly the discussion paper — is that local governments will have greater authority that will influence taxpayers. I know that. Have you had any discussions with the Ministry of Health on changes to health authorities?

H. Kushner: First of all, I want to thank you for your comment about the charter because I think that's right. We have to be cognizant of what those changes are. With respect to the health authorities, we've not had any discussions about specific changes. We're watching it in the same way that everybody else is. We take complaints, for example, just on medicare and Pharmacare, and we're watching what happens with those programs. We get complaints from individuals who feel they ought to have received more coverage for a particular drug or program. All of those things are happening, and we're watching to see what's happening, but we don't participate in any of that sort of discussion. It's sort of reactive in that sense.

J. MacPhail: One of the roles that I think the ombuds office has always played very ably is to comment on legislation and the effect it may have.

Directly to you, Mr. Chair, that is a useful role that the ombuds office could play in changes that may involve legislative changes in these two areas — the health authorities and the municipalities. I doubt very much the ombudsman legislation is going to be changed to remove their responsibility for those two areas, nor would I think it would be acceptable to the public to have that removed.

I note in your budget, the three-year budget request, that about 80 percent of your budget is salaries and 20 percent is operational. Are the operational costs fixed, or are there variables there?

L. Hubbard: When you take into account all the components of salary, including benefits, chargebacks and so on, it's actually higher than 80 percent. The operational costs, for the most part, are fixed. Our space charges —rental charges through BCBC — are the next largest single fixed cost. Then you get into communications. Telephone lines and data communication lines become the next major component.

In the parts of the budget you'd typically think of as being where you can make some savings, in travel expenses and so on, our budget this year is roughly $70,000 for that, out of a $4.75 million budget. Mr. Kushner mentioned we don't have a lot of…. By the time you take out the fixed charges, there's not a lot left. If you have to accomplish significant savings, the only place you really can do that, then, is to start to look at salaries.

B. Lekstrom (Chair): I just have a couple of questions, Ralph, and then I'll go to you.

Howard, we've heard a number of 50 FTEs. Is it fair to assume, when I look at your budget, that you're calculating your salaries based on 50 FTEs? Is that what's in there?

L. Hubbard: Yeah, that's correct. Of course as you know, the salary of an FTE can vary. A salary for an admin assistant is quite different than a salary for a senior manager.

B. Lekstrom (Chair): Right. Are the employees you have working covered under a collective agreement, or are they all exempt?

L. Hubbard: The employees are all excluded. They're either management level exclusions or what's called schedule A exclusions. If they hold the same classification in a non-excluded position, then they're schedule A excluded employees.

B. Lekstrom (Chair): Okay, a follow-up question on that. I look at the budget years from 2002-03, which are reflective of 50 FTEs, I'm assuming. I'll go to 2003-04 and 2004-05. Are those reflective of 50 FTEs or are those already downgraded numbers?

L. Hubbard: Those are reflective of 50 FTEs. Depending on where the reductions would occur — on the uptake of early retirement and so on — it would depend on how many FTEs. It's been our experience that the bigger control is the salary dollars available rather than the FTE quotas per se.

B. Lekstrom (Chair): I'll try and sum this up; I know our time is short. A quick calculation: a 10.34 percent increase is about what that relates to from our original stand in the current year to the 2004 projected budget.

L. Hubbard: Right, 2004-05 is just 5 percent each year as on the note on the bottom. I'm not sure which page you're looking at. Because of the uncertainties Mr. Kushner referred to, we just applied 5 percent to each of those years. Not to next year — it's a flatline — but beyond that, for purposes of an estimate we just applied 5 percent to each of those years.

B. Lekstrom (Chair): You talked about the case tracker software sales — the external recoveries, the revenue. Can you give me a number on what we have received to date on those sales?

L. Hubbard: The price varied, but the most recent sales were about $40,000 (U.S.).

L. Hubbard: The first time the case tracker was sold was actually when the children's commissioner was being set up, so that was an internal thing. I think the sale was about $20,000. In total, I would guess that we've probably received in the order of $100,000 to $120,000. That would be over a period of about four or five years.

H. Kushner: May I just comment on that? When we used the Purchasing Commission — because we decided we weren't in the business of selling this item, but we thought it was an item worth selling — our recovery would drop down then as a result of that. If we were selling it for $40,000, we wouldn't recover the full amount of $40,000 for our office. So much went to the Purchasing Commission, and so much went to us. If we made the sale ourselves directly without going through that, we were able to recover the full amount. I must say that it would become more attractive to us if we could sell it ourselves, obviously, than going through the Purchasing Commission.

L. Hubbard: In fact, for the last sale, which was about $40,000 (U.S.) or $45,000 (U.S.), we received 25 percent of that. The rest went to the….

L. Hubbard: My understanding is that it went into general consolidated revenue. There's a whole program on the sale of intellectual property. If there was some benefit, it went into consolidated revenue.

B. Lekstrom (Chair): Just following through on that, when I look at the operating budget and our capital budget as laid out on this sheet, can we get a more detailed breakdown of that for this committee?

H. Kushner: Certainly, I'd be happy to do that. I didn't know what the detailed information was you'd receive. We can provide you with the information that would go into the Treasury Board process. It was not clear to me whether you wanted line-by-line or STOB — I think they're called — figures or whether you simply wanted the large figure for operating and salaries. I would be happy to provide that to you. I don't know if we have it with us or if it's back at the office, but we will have it to you by the end of the day.

B. Lekstrom (Chair): Terrific. I think this is a great start. I know the members of the committee are going to sit down and review everything in a more detailed breakdown for both capital and operation. If you got that information to Craig at the Clerk of Committees office, he could distribute it to all the other members.

B. Lekstrom (Chair): Okay. We do have time for another question. Ralph, I'll go to you.

R. Sultan: I think this is an area we could have a great philosophical discussion about all afternoon, Mr. Kushner. I presume there's been a great expansion in the ombudsman's office over the past decade.

H. Kushner: The annual report indicates that in, I think, 1993-94 we had 49 FTEs. We have remained at 50 FTEs. We went to 53 FTEs in '95-96. That's the information in the budget summary. We've remained at about 50 FTEs since, essentially, our jurisdiction was expanded from the core of the provincial ministries, Crown corporations and provincial commissions to the expanded jurisdiction over schools, etc., which I outlined.

H. Kushner: The first expansion, dealing with schools and school districts, occurred in 1993. Then we progressed slowly through to municipalities in 1995.

R. Sultan: I note in the appendix that your authority now extends to the Whistler Resort Association and the Okanagan-Kootenay sterile insect release board.

H. Kushner: I would say so, but interestingly enough, we actually had a complaint this year in regards to that latter one.

R. Sultan: This is not a legal authority. It's just a complaint that happened to come in with respect to sterile insects.

R. Sultan: What I mean is, there's not a list of prescribed jurisdictions over which you have command that happens to include sterile insects.

R. Sultan: They don't just arise spontaneously, depending on complaints? They're actually in legislation or regulation somewhere?

B. Parfitt: They're in the schedule to the Ombudsman Act. They're specifically named.

H. Kushner: Just on that, the way the members of the board or commission might be appointed and will give us jurisdiction may not be named specifically, but we might have authority.

R. Sultan: My final question relates, first of all, to pointing out the lamentable reality that this government is painfully dealing with a $3 billion structural deficit in the fiscal affairs of the province. We are asking all of the ministries outside of health care and education to reduce their expenditures by a number which I think was recently cited in the media as 30 percent on average over three years, which would equate approximately, say, to 10 percent a year cumulatively over three years.

If we were to apply the same guideline to the ombudsman's office that, for example, we're applying to Children and Family Development or to B.C. Benefits or to Forests or to Transportation, the highways department, how would you cope with that rather significant shift in funding of 10 percent per year over three years cumulatively?

H. Kushner: I would propose to deal with it in the same way the ministries are proposing to deal with it: not provide the service, change my legislation, take away authorities. I can't provide the same level of service with that. One could say: "Take back the 20 percent or 15 percent that the expanded jurisdiction provided for." That would be one approach. If you came to me and said, "You have to do a 30 percent reduction," I think I would say: "Well, you have to tell me, then, which authorities you want me to look at, or I will come forward with a proposal as to changes to my legislation." I think that's the only way.

I obviously could not be the same office I am today, just in the same way that the Ministry of Human Resources and the Ministry of Children and Family Development won't be the same service delivery, the same model. I think that's the way we'd have to deal with it.

R. Sultan: I suppose, as you suggest as a possibility, returning to the original mandate of the ombudsman's office, prior to 1993, might be one start.

H. Kushner: I guess what I should point out is that the original mandate was always in the legislation. It was there from 1979. What was not proclaimed into force was the full list of the authorities. They restricted the authorities, so they go back. That's a possibility, if this committee would want that. In a sense it's saying to individuals within municipalities: "There will not be any remedy for bureaucratic unfairness or maladministration — to go to the ombudsman's office. That public authority can deal with you in that fashion, and whatever other recourse you have, you won't have recourse to this office."

Obviously, you can say it for any of those authorities. The way you'd have to deal with it is to say: "We can't deliver the service we're delivering now. We have to change what we take complaints on." A decision is being made that individuals who feel they've been unfairly treated or who are being subjected to the weight of bureaucracy will not have our office as an opportunity to be able to see whether or not that's the case.

R. Sultan: Outside of the provincial ministries themselves, if I could tack on that amendment.

H. Kushner: Provincial ministries and hopefully provincial Crown corporations and boards and commissions.

B. Lekstrom (Chair): Howard, I note that we have run overtime, and we do have a full agenda for the committee today. I would like to thank you, along with Brent and Lanny, for coming and presenting today. I think you've done a tremendous job of giving us a very informed overview of what your office provides for the people of British Columbia. Our job now will be to evaluate and go through the information you've given us. I look forward to the further information you will

forward regarding the operational capital budget expenditures. We will take that and give it due consideration in the development of our report. Once again, thank you very much.

H. Kushner: Thank you, and I do want to thank the committee for their attentiveness, which I noted, and for the interesting and challenging questions you've presented to us. I do want to express how much I appreciate having the opportunity of speaking to a committee and doing a presentation. When I was appointed ombudsman and was going through that process, one of the issues I raised was that it would be nice to have a committee to report to and a committee to work through on issues such as budget and so on. I do want to express my appreciation to the members of the committee for participating in this process.

R. Sultan: Just speaking as a private member, let me say how much this private member and, I suspect, all of this committee appreciate the hard work you do and the obvious diligence you apply to the task at hand. Thank you very much.

B. Lekstrom (Chair): Thank you. We will take a five-minute break while we get ready for our next presenter, Mr. Bob Patterson, who is our chief electoral officer. I note Bob is here with some members and staff. We'll begin in five minutes.

B. Lekstrom (Chair): Committee members and presenters, thank you for coming today. I know the time frame has been fairly tight for both sides. I would like to welcome you, Bob, to our committee. Just to begin, I would like to introduce myself. My name is Blair Lekstrom. I am the Chair of the Select Standing Committee on Finance and Government Services and the MLA for Peace River South.

This is a new process that we're involved in, for you and for us as members of the Finance Committee. Just prior to going into your presentation, I would like the members of the committee to briefly introduce themselves. Then we will continue. I will begin with Brian.

B. Lekstrom (Chair): Thank you. There are a number of other members who will join us in due time, I'm sure. With that, Bob, I will turn the floor over to you at this time, and we'll go from there.

R. Patterson: Thank you very much, Mr. Chairman and members of the committee. I'm very pleased to appear before this committee and present our budgets and service plan for the next year for Elections B.C. I'll also comment that in the package provided to you was a copy of our annual report for the year 2000. We did submit that to the Speaker at the end of August, and I assume you previously received a copy, but I'm providing one for you again today.

Accompanying me today are colleagues from Elections B.C. I would like to introduce to you Linda Johnson, deputy chief electoral officer, and Nola Western, director of electoral finance.

This being our first appearance before the committee, as you said, the Clerk's office suggested that I should start off with a background on our office. I'll briefly comment on a few highlights of our activities last year and then turn to our future plans, priorities and budgets.

In British Columbia the position of chief electoral officer was created in 1947. At that time the office was a branch of the Ministry of Provincial Secretary. In 1995 the Election Act was rewritten and established the chief electoral officer as an officer of the Legislature, thus formally recognizing the need for independence and emphasizing the neutrality of the office. That year also saw the full implementation of the Recall and Initiative Act under our administration.

The 1995 changes to our electoral legislation, which established the chief electoral officer's independence, also pushed the notion of neutrality down to the electoral officers in the field. District electoral officers and their deputies are appointed by the chief electoral officer through a selection process based on merit. I might note that previously all of these individuals were order-in-council appointments.

Once appointed, these individuals are not permitted by legislation to belong to or make political contributions to any political party or a candidate's campaign. This has reinforced the impartiality of the electoral system.

The public's confidence in our electoral system is largely based on open and fair competition, media scrutiny and the neutrality of the electoral administration. The chief electoral officer and deputy, by statute, cannot belong to nor contribute to any political party, and both individuals are prohibited from voting in a provincial election.

Similar to all provincial, territorial and federal electoral offices, our primary mandate is the fair, impartial administration of the electoral events within our jurisdiction. This includes general elections, by-elections, referendums and plebiscites and, unique to British Columbia, citizen-initiated recalls and initiatives.

Additionally, the chief electoral officer is charged with the responsibility for the continuous maintenance of the provincial voters list, the implementation of the redistribution of the electoral districts and voting areas and voter education regarding voter registration and electoral processes.

In addition to the overall responsibility for the administration of the electoral process set out under the Election Act, the chief electoral officer has discretionary powers to make exceptions to the act and its regulations because of an emergency, a mistake or an extraordinary circumstance.

Also very unique to this position, the chief electoral officer has the authority to make regulations under the act, a power usually reserved only for cabinet. However, before making a regulation, the chief electoral officer must consult with the election advisory committee, which is constituted under the act except during the election period for a general election.

The office also has responsibility to enforce fairness, impartiality and compliance with the provisions of the Election Act and the Recall and Initiative Act. The acts require the chief electoral officer to enforce the legislation through conducting independent audits and investigations. Findings of contraventions are forwarded to the criminal justice branch, Ministry of Attorney General, which may appoint a special prosecutor to consider legal action. No prosecution under the Election Act can commence without the consent of the chief electoral officer.

British Columbia's election legislation also mandates the chief electoral officer to inform the public about the electoral process and individual electoral rights and to remove obstacles that may make voting difficult for some. Elections B.C. informs voters about the right to vote, how to get on the voters list and when and where there are voting opportunities.

Public information activities include news releases, advertisements in print and electronic media, a comprehensive website, brochures, posters, individually addressed where-to-vote cards during an election, a toll-free inquiry service and a TTY service for voters with hearing impairments. Voter registration and voter information are available in 15 languages.

We also encourage youth participation in the democratic process. We have provided an election simulation kit to all grade 5 teachers in British Columbia that complements the democracy element of the curriculum. Print advertising encourages voters to take their children with them when they go to vote, and we hire high school students as election officials. Our future plan includes developing a similar kit for grade 11 or 12 students to encourage their participation in the electoral process.

Although the Election Act and the Recall and Initiative Act establish that all necessary expenses for the administration must be paid from the consolidated revenue fund, Elections B.C. traditionally has a voted appropriation. The administration or event management infrastructure budget provides primarily for the salaries of a core group of permanent employees.

The balance of our budget provides for all of the other expenditures of the office. These include costs of services, supplies and the staff necessary in preparing for and conducting general elections, by-elections, referendums, recalls and initiatives; the costs of providing special projects to improve the electoral process and access to it; and the provision of advice and support on electoral matters. The statutory portion of our budget obviously fluctuates significantly from one year to the next.

Now I'd like to turn briefly to some of the highlights of Elections B.C.'s activities in the past year. Naturally, the majority of our activities were focused on the preparation for and conduct of the general election held on May 16 of this year. In the lead-up to the election, advertising was created and media plans developed to ensure voters were informed of their rights, opportunities and responsibilities during the election.

Newspaper, radio, television and a householder mailer, in addition to the where-to-vote cards, were all utilized to impart specific information. Our toll-free information service recruited and trained approximately 80 temporary staff to provide assistance for voter registration confirmation and changes of address and information on voting opportunities and voting locations. This service took over 74,000 calls during the election.

With the calling of the general election, a new electoral map came into force. The number of electoral districts increased to 79 from 75. This necessitated a review and adjustment of all the voting-area boundaries, creating 8,462 voting areas throughout the province. More than 1.5 million addresses and over two million registered voters had to be reassigned to these new electoral districts and voting areas.

Additionally, over 150 constituency associations had to be deregistered under old boundaries and reregistered under the new boundaries. All of these new boundaries were depicted on 361 new electoral maps. Over 15,000 copies of these maps were distributed prior to and during the election. A special set of maps was also created for our website. A new location index had to be compiled to list settlements, post-secondary educational and correctional institutions, hospitals and other care facilities in their respective electoral districts.

The establishment of the new electoral districts also meant the appointment and training of district electoral officers and district registrars of voters. District electoral officers undertook an assessment of potential voting places with regard to their accessibility for the physically disabled and the establishment of special voting areas for extended care facilities. During the election we started to see the impact of an aging population's increased demand for voting opportunities other than on election day.

Our electoral finance division conducted a dozen regional pre- and post-election information seminars for political party, constituency association and candidate financial agents. Over 300 people attended these seminars. Our post-election review of the election financing reports has shown a dramatic improvement in the on-time filing of the reports and in the completeness and accuracy of these reports.

Elections B.C. is continually looking for ways to increase the currency and accuracy of the provincial voters list and to level out the peaks and valleys of activities during and between electoral events. We are looking at enhancements in data exchange with the

remote voter program, the Vital Statistics Agency and the multiple-address-change project, as well as external information sources. Approximately 590,000 transactions were processed through the voters list system in 2000, and this year an additional 374,000 address changes and 230,000 new registrations were received prior to and during the election.

The voter turnout rate in the May 2001 general election was 71.2 percent, down only slightly from the 71.5 percent turnout in 1996. Although the downward trend in voter participation appears to have levelled off, we are still committed to ensuring that all of those who have the right to vote have the information and opportunities to do so. Although a fixed election date removes some uncertainty, the possibility of by-elections and applications for the issuance of recall and initiative petitions still requires constant readiness.

The universal question that people in our line of work get asked is: what do you do between elections? Perhaps the answer to that question is what do firefighters do between fires? Or what does the military do between wars? We are continually planning for the next event — fine-tuning policies, procedures and guidelines; improving our forms and manuals; training staff and election officials; and designing additional information technology management tools as resources and time permit.

That brings us to our service plan, which you have before you. I'd like to ask my deputy, Linda Johnson, to briefly take you through it. My colleagues and I will then be pleased to respond to your observations and questions.

L. Johnson: The cover of the service plan says it's covering three years. Until yesterday afternoon it was only covering one, and then we received instructions that in fact it should be covering three. So I apologize for any bumps along the way. I hope I've sufficiently expanded it. Fortunately, we had done a three-year budget, so we weren't too far behind.

To lead off, some of this might be a little redundant, based on Bob's comments, but to clarify, we used Elections B.C. throughout our material, and that is the usual name for the office of the chief electoral officer. And of course, the chief electoral officer is an officer of the Legislature, appointed under the Election Act.

The chief electoral officer is responsible not only for the Election Act and the Recall and Initiative Act but there's actually a pile of statutes that we are somehow involved in, including the Referendum Act, the Constitutional Amendment Approval Act, and so on. The Election Act and Recall and Initiative Act both include a statutory appropriation saying that all necessary expenses required for their administration come out of the consolidated revenue fund. The chief electoral officer, as I mentioned, is responsible for a number of pieces of legislation and is a standing member of electoral boundary commissions that may be established under the Electoral Boundaries Commission Act.

The vision of Elections B.C., I'm happy to say, isn't too far off from the reality for Elections B.C., which is we're an efficient, effective organization. We're non-partisan. We ensure fair and impartial administration of our legislation. I believe the citizens of B.C. have confidence in the electoral process, and I think they believe we act with equity in our dealings with them.

The provisions of the Election Act and the Recall and Initiative Act are generally understood and respected, and British Columbians do enjoy unfettered access to their democratic rights established by the Canadian Charter of Rights and Freedoms, which is really where our mandate comes from.

Our mission, simply, is to serve the people of British Columbia by ensuring effective and impartial administration of the electoral process. I should qualify that in that we make a distinction between the initiative process and the electoral process. Although we say electoral process here, from time to time you'll see us making a distinction between electoral and initiative events.

The values of our organization are probably similar to the values of most organizations in government. We respect the rule of law. We work with integrity, transparency and neutrality. We place value on honesty, and in our business, knowledge and professionalism are very important. We operate with fairness and equity, and we certainly respect individual differences and individual rights.

The environment we work in is largely one of uncertainty. As Mr. Patterson mentioned, certainly having a fixed general election date helps, but there are still a broad range of activities that our clients choose to participate in, or not, that affect our work dramatically from day to day.

One of the external issues we're aware of right now, which is driving a lot of our decision-making, is there appears to be growing dissatisfaction with the first-past-the-post electoral system. Government has stated they intend to appoint a citizens assembly for electoral reform. We've also heard from other political parties that they're interested in pursuing proportional representation. The potential change out there to how our electoral system works is an issue.

Government has also stated there will be a referendum on treaty negotiations held within a year of the 2001 general election, and that will necessarily involve our office.

Voter turnout at traditional ballot box elections is declining throughout North America. Although, as Bob mentioned, our turnout has been consistent for the last two elections, we have to keep an eye on that continental trend and make sure we've identified successful strategies to hold the line at turnout.

Voter participation rates among youth continue to decline in B.C. and throughout North America. This isn't just us; this is a continental problem. To have strong democratic institutions in the future, participation by all segments of the population is important. We need to look at ways of making voting attractive and simple for youth and other segments of the population.

Public interest in technology in general — and Internet voting, telephone voting, whatever — puts some pressure on us to explore and adopt those meas

ures, although our colleagues from around the world are feeling pretty uncertain about the future of telephone and Internet voting. There's certainly pressure from behind on that one.

Non-compliance with electoral financing laws is declining, but we continue to have some problems, and they really create an investigative burden on our office. We have a requirement in the Election Act to conduct periodic audits, but on top of that there is a fair amount of time and money going into investigations.

The legislated requirement that the voters list be used for juror selection lists prevents us from getting access to the federal voters list. Because our list is not being used for a purely electoral process, the feds, under their legislation, can't provide us with a copy of the national voters list. That creates some difficulty not only for our clients, who believe there should be one universal voters list, but also for us internally on maintaining currency.

Speaking of internal issues, one is that we've recently had some high turnover rates, some within Elections B.C. itself but certainly among district electoral officers and their deputies. As of November 16, all of their appointments expire. We're in the process now of recruiting provincewide. This creates a need for continuous training and development to make sure we maintain our ability to meet our mandate and the needs of our clients. That's an internal issue we're facing.

We've also experienced some delays in getting classifications for our staff positions and, coming from that, delays in recruitment. That has created a dependency on contractors and temporary staff, and that carries increased costs and risks with it as well. We are hopelessly overcrowded. The inadequate space in our headquarters has resulted in us now being in three offices just in Victoria and possibly soon moving to a fourth one to manage a referendum from. That has created internal communication issues. It all carries an associated cost with it. Internally we're grappling with a few things.

Opportunities for us. A fixed election date for a provincial general election greatly improves our ability to effectively and efficiently plan for a general election. I think you'll see that reflected in our three-year budget.

We have been working very hard on our electoral-information system, which will replace the old provincial voters list system and bring in some new features. We've been working on this for the last couple of years. We're very close to full implementation. That will also further our ability to use our data efficiently and effectively and streamline some of our election period procedures.

Challenges. The uncertainty about electoral reform, the whole context we're working in, the timing and process of the referendum on treaty negotiations and the uncertainty about possible legislative amendments obviously impair our ability to plan. We're planning based on what we know right now but realizing that all bets may be off if there's a dramatic change in any area.

The unpredictable timing of by-elections and public use of recall and initiative legislation is also a constantly moving target. That creates unexpected resource pressures and sometimes affects our ability to manage projects efficiently. We may have a one-year project we're working on because we're between general elections, and suddenly you get a flurry of recalls coming through. It throws everything off. That's just the nature of our business. Election administrators from across the country have had the same issue.

Again, lack of access to the federal list and the growing trend towards voter registration in conjunction with voting does make it difficult for us to ensure currency and accuracy of the list on a continuous basis. Recall and initiative demand a constantly current voters list. Voters are just not that interested. Although we have some data-sharing that Bob mentioned — our motor voter program, vital statistics, the common address change project — having the federal list would be of great assistance there. We're constantly looking for ways to engage voters in keeping their registration with us current between events to try and manage some of that.

The following page is a graphic depiction of what our business cycle looks like. Our business cycle typically is four years long because that's the period between general elections, and we base our activities on that cycle. What's going around the outside of this chart starts with the last general election, and the items appearing there are basically legislated activities.

We're required to produce a statement of votes. That's a statistical summary of poll-by-poll results from a general election. We're also required to produce an election financing report. In the middle of that there's an initiative petition. Adriane Carr has announced publicly that she intends to launch an initiative petition around proportional representation, and we're expecting that to come in the door any day now.

District electoral officers and their deputies. I mentioned that we're in a recruitment drive right now. We're starting to do some maintenance on our voting area boundaries. Those are the administrative electoral units that we use for election and event management. We need to do some maintenance by the end of this fiscal year to be ready to manage a referendum if it's a ballot box vote, so we're undertaking some work there. We also need to get our district electoral officers and deputies trained pretty quickly once we've appointed them if, in fact, we're going to a ballot box referendum or just to deal with any intervening by-elections.

Annual financing reports from the registered political parties and registered constituency associations have to be filed by March 31 of every year. Once they come in, there's a bit of a compliance review that's done, and they sometimes trigger audits or other investigative work in our office.

The Recall and Initiative Act establishes that an initiative vote will be held every third year. There's one scheduled for September 2002. You'll note in our

budget that I've footnoted it would be probably be an $18 million item, which we have not budgeted for because no one got in on time to meet the time frame. Recall petitions become available November 2002. If our experience in '97 was any indication, there's always somebody who's waiting on the first day to be the first one to apply for a recall, so November 2002.

Voting area redistribution. We do ongoing maintenance of our voting areas as much as possible, rather than make it into one big megaproject. It's very hard for us to respond quickly to an event. It means we're dispersing the work across some inexperienced staff. By doing small voting area redistribution projects every year, we can rely on the same experienced temporary staff. We can contain the costs associated with it.

General election preparation. Because of the magnitude of a general election, it takes us a couple years of serious ramp up to get all our materials ready and our warehouse stocked up. We don't like to do that too early in case legislative amendments change the content of those forms. There are some ongoing costs associated with general election preparation, though, in just keeping our district electoral officers in place and trained and ongoing preparatory work.

Election Act revisions. We've put it in there. We didn't know when it would happen, but we've already seen some. Following every general election, the chief electoral officer makes a report to the assembly. In that report, typically, there are recommendations for amendments to the legislation based on our experience or the experience of our clients during that event. We've put it into 2003 there.

Legislation currently requires us to enumerate in the third calendar year following a general election. Last time we did an enumeration in '99 by mail. It was about half the price of going door to door, but there is a fair amount of preparatory work associated with that. Enumeration preparation will start early in 2004 in anticipation of an enumeration in May 2004.

Voting area boundary maintenance, finances and reports. Doing some voter registration drives in anticipation of the next general election tries to remove some of that activity from the voting places on general voting day. That's the worst time and place to register to vote, so we're trying to be proactive about that.

Now, the goals of our organization stay the same all the time. They're basically a reflection of our mandate. We need to maintain an appropriate state of readiness for electoral and initiative events — not be constantly ready for everything all the time but at an appropriate level of readiness. We need to make sure that all qualified voters have the opportunity to vote and that there's public awareness of the process. The better the public awareness, the more likely you see good turnout at events.

We need to maintain a current and accurate voters list. I know MLAs use that for contacting their constituents. Certainly we need it for recall and initiative administration. By keeping it at a steady level on a continuing basis, we manage the costs around enumeration. It enables us to do enumeration by mail, for example.

Our core business areas are obviously voter registration. They look after list production and maintenance. Electoral operations. That's basically anything to do with getting a ballot in your hands. They also provide candidate services. That's who looks after nominations. Recall administration, petitions and initiative votes. Electoral finance, which Nola Western is responsible for. Political entity registration. Electoral and initiative finance administration and also our finance, admin and human resource function falls under electoral finances area.

Electoral geography does electoral boundary management. We don't define electoral districts. That's done by the commission, and then the Electoral Districts Act defines them. We're responsible for then interpreting them into voters list and managing them and the next level down, the voting area management.

Address management. All voters are linked to addresses, and addresses are linked to electoral districts. There's a very complex process associated in our business with address management and the resulting map production.

Corporate communications. Unlike just putting out news releases, our communications department does all our website and all our desktop publishing. It's a two-person shop. They're also responsible for all our voter education and voter outreach activities.

The goals are on this small table. I've outlined the key business areas that are responsible for each of those four goals. We're a small organization, and we work collectively on pretty well everything. We have 48 FTEs provincewide. We have offices in Kelowna; Langley, which is where our warehouse is; Vancouver; and here in Victoria. On general voting day we grow from 48 FTEs to 30,000 people. We become almost equivalent in size to the public service. That core group of 48 FTEs obviously works very collaboratively on meeting all of our goals, largely because we're the base that then has to supervise those 30,000 temporary staff and deal with all of our clients. Pretty well every British Columbian is impacted by the work we do, directly or indirectly.

The following five pages take each one of our goals and give you a sense of the objectives and strategies and performance measures associated with them. You can read them; I'm not going to take you through all of them. Generally speaking there's enough there — I didn't put every single point, because we have about 60 points associated with general election readiness — to just give you a flavour of the type of things we do and how we assess our performance against those. Having material ready, making sure we have a plan in place for providing voting opportunities to military deployed outside B.C., having a plan in place for liaison with large ethnic communities to make sure we're able to reach them and get information to them, making sure we have a mechanism in place and a measurement in place to be sure the voters list is an accurate reflection of the electoral districts that people reside in — a

few pages there give you a sense of the work we do associated with meeting those goals.

In terms of the fit with government priorities, one priority this government came out with right at the beginning of their mandate was to be open, transparent and democratic. That's sure a good fit with our business and what we do. Specifically, though, the New Era document and the letter to the Attorney General, who's responsible for the Election Act, outlined some specific activities that government intended to undertake. We're certainly available as a resource to provide briefing materials to any member and explain some of the technical aspects of our business and how they relate to these activities. As mentioned, the chief electoral officer also has a mandate to report to the assembly on issues about our business and aspects of the legislation that also, in addition to what government has already identified, may benefit from review.

In terms of resources, as we mentioned, the Recall and Initiative Act and the Election Act both specify that all the expenses associated with the conduct or administration of those acts come out of the consolidated revenue fund. Obviously the work we do is entirely driven by legislation and the activities of our clients. If political parties have leadership contests, that affects the activities of our office. If somebody decides to launch an initiative, or three or ten or 15 initiatives, that affects our business. If a member decides to seek federal office and resigns their seat, that triggers a by-election. A lot of this is driven from outside.

To assist government in budget development and expenditure management, traditionally we've been provided with a voted appropriation. That voted appropriation is typically a reflection of two realities. One is the infrastructure we require. Our 48 FTEs are in there with building occupancy of our ongoing offices and some other ongoing activities to make sure the infrastructure is in place to manage an event, no matter what type of event that is. All the costs associated with elections, by-elections and the whole list of things we do are statutory expenditures. There we develop projections based on historical patterns, because we don't have anything else to draw on, and anticipated events.

Obviously we know when an initiative vote is scheduled. We know when the next general election is scheduled. We know there are annual financing reports that come in every year. We also know, on average, there is a by-election every fiscal year over time. We've arbitrarily decided we'll budget for one recall each year. That's how we do these projections. That is the basis for our statutory budget, if you will.

We run a pretty lean shop, and we're very aware of the public perception of spending. We always have been. We're very cautious. You know, an election is two months long. We don't rent lavish offices. We don't get fancy furniture. We try and keep things reasonable in the context we're working in, but a lot of this is largely out of our control.

In the following table — and I hate to admit this to people who make decisions about our budgets — a lot of this stuff, especially around the statutory activities, is guesswork, because we just don't know. If we budget for one recall and there are ten, well, the world's changed. If there isn't a by-election one year and there are three the next, we just have to respond to that.

About 60 percent of the total event management infrastructure is salaries of our regular staff. There's really not much in there other than our 48 FTEs and the building occupancy for our regular staff. The amortization rates associated with that are reflected there. You see a slight bump in the next fiscal year. The office consolidation of our Victoria operations was deferred for two years for a variety of reasons. Largely, we were focused so much on doing our electoral information system and getting ready for a general election that we had to put off our consolidation move. You can't move in the middle of an event.

Now that we know when the general election is, we're budgeting to consolidate all our offices into a single location in Victoria. That's part of the distinction there. There's also an increase in amortization there to reflect some one-time move costs and some increases related to software we required. Everyone had to buy Windows XP in a rush this year to save some money. The amortization shows up next year.

Statutory activities. As I mentioned, we've gone just straight across the board with one by-election a year. EIS non-capital is our electoral information system. As you can see, the costs really plummet next year. We'll be over most of that.

Election preparation. As you can see, that ramps up. In the second and third years, 2003-04 and 2004-05, those increases are largely reflections of us stocking up our warehouse and increasing the frequency of our training. We do attempt to stay in touch annually with our district electoral officers, district registrars of voters and deputies to keep them fresh and train them. This is a very complicated business, and you have to feed it to them over a period of time. We also pay a very modest stipend of $600 a year to our district electoral officers. They store some of our material, and they undertake some activities on our behalf between events. That is also in that election preparation budget.

Enumeration doesn't show up until some preparatory work in 2003-04, and then the balance will be a cost in the enumeration in 2004-05. How we enumerate drives the cost entirely. We base this on our experience from last time around.

General election. The current year shows what was budgeted for the general election. I think we're probably going to come in pretty close to that — slightly under, I think. We haven't budgeted anything for that for the following years.

Geography. This year probably underrepresents what we truly needed there. I think some of it probably showed up in capital, and it really should have been up here. This is the address base we use. It's sort of half of the voters list system.

The initiative petition. We've budgeted for one full petition that goes through the verification process for each year. We don't have any control over that, but it's there. You'll see for initiative vote for the coming fiscal

year — I just footnoted this — it would be $18 million, probably. We didn't put anything in because no one's met the deadline.

Investigations, on average, are $75,000 a year. We've just put that straight across the line.

List maintenance. This goes up and down, but core list maintenance is about $1.5 million.

Political entity reporting. This year, because it was an election year, there were some additional costs associated with that. We also had a number of constituency associations deregistered when the new boundaries came into effect. That trends down slightly over coming years.

Recall petition. We had a token amount in there this year basically just to keep our signature database up to speed following the general election. We've just budgeted $30,000 for a recall petition for every subsequent year.

Redistribution. A lot of the costs this year here are carryover from the electoral district redistribution and some of that fine tuning of voting areas in preparation for the referendum. Following that we'll do some intensive voting area redistribution work in 2003-04 and maintenance working in the intervening years.

The referendum. I've put in an $18 million item here because, if you did a ballot box referendum that looked like a general election without candidates, that's about what it's going to cost. Depending on what model government chooses to use, that cost will go up or down. I put $18 million because that's a general ballpark to work on.

The officers' salary and benefits. Being a statutory officer, that's where this shows up. Special projects. This is largely what we use for the audits we are required to conduct each year. It also allows us to respond to things. If we find, for example, that an ethnic group is having a major celebration, it allows us to take advantage of that to do some voter registration and voter education with that community. This is sort of used for a variety of purposes. It also pays for printing things like annual reports and other activities.

Voter education. You'll see that this has dropped significantly. We've suspended a couple of activities we would traditionally do. They were soft. They were nice to have. We know that nice-to-haves are on the table, so we took them off.

The capital expenses. Again you see, under 2002-03 capital, there's a big jump there, and then things really flatten out in subsequent years. That is a one-time cost for our office consolidation in Victoria. That is what's showing up there.

If you look at the total anticipated costs for the current year, we're at about $37 million. Assuming $18 million for a referendum next year, we're looking at just under $33 million. That drops to about $13.5 million, and then starts ramping up slightly in anticipation of the general election to $17.6 million in 2004-05.

The last page is just a very high-level human resource management plan. This is typical of what you're probably going to see from any government organization. All government organizations need to ensure that the staff they have are properly utilized, that they're in the right places doing the right things and that they have the skills and knowledge necessary. We have an internal training process we conduct. We don't typically use outside trainers. We do all our training in-house. We also do performance management and measurement for our staff.

R. Patterson: At this stage, Mr. Chairman, I think we're ready for your observations and questions.

B. Lekstrom (Chair): Thank you very much for your presentation to our committee.

T. Bhullar (Deputy Chair): I don't have too many questions. I just want to compliment your department on the excellent job, given that this Election Act is very convoluted. Being a lawyer and looking at that act, I can't even make heads or tails of it, so if you can run the election with that act, I've got to compliment you on an excellent job.

J. Bray: Thank you very much for a very thorough presentation. It was appreciated. I'd actually like, first of all, to echo Mr. Bhullar's comments. I was extremely impressed, being a first-time candidate, with the services of our district electoral office and our DEO as well. I really was very impressed with the service, right from initially getting my candidate papers and the help I got from the staff at Cook Street. I think the 48 permanent FTEs you have do an outstanding job and are definitely great value for the expense.

My comments are more related to the event management itself. I think the 48 staff do an outstanding job and obviously — seeing how you grow when events are happening — are very well equipped. I notice, in your service plans, that you are guided very much by external factors: an election is called, a recall is called. I'm wondering whether or not you do an evaluative process with respect to trying to improve the events themselves from event to event — for instance, general elections.

What I'm getting at is trying to reduce the number of errors that occur at voting places, those types of things, so you can measure the effectiveness of your training, the effectiveness of your DEOs, the effectiveness of the deputies and their correlation to your core staff. I wonder if you could comment on that, Bob.

R. Patterson: Certainly. We conduct fairly extensive what we call post-mortems following elections. We meet with our district electoral officers and their deputies as soon as we can after an election to assess how they saw the election. We meet with representatives of the various political parties represented on the Election Advisory Committee and ask for feedback from the various political parties: how they saw the election from an administrative point of view.

We also look at the actual documentation that was completed at the polls — the voting books, the voters list that we use — so we can see firsthand what the people on the ground were doing. Certainly we know that although we can attempt to train individuals, sometimes people will come for training but they don't necessarily listen to that training. We have seen errors and mistakes. We look at the voting books to see how they were completed, how the documentation was completed — the statements of polls made out at the voting places — to see where there were errors made, and then we see what we can do to turn that around through our training and just exactly what we can do in that regard.

Prior to this last election we had a number of requests from our district electoral officers for a training video. We looked at it for a number of years. The idea was to have a video that they could use to train their officials and then supplement that with hands-on. From the feedback we have got from our district electoral officers and from individual poll officials themselves of whom we also did surveys, we found out some voting officials used the materials properly. Others did not.

We're going through the assessment process, and that reflects on the evaluations we have done of the district electoral officers. I'd like to mention that all appointments expired November 16. Some district electoral officers will not be reappointed.

L. Johnson: Further on that point you'll notice in our lists of projects, if you will, associated with our goals that we mention preparing a DEO workbook. That comes directly from the feedback from district electoral officers following the 2001 election: "The video was a good start. Now we need a workbook for voting officials to go through." That is reflected in this report.

J. Bray: I would just comment that one of the things that is very helpful in annual reports — and certainly yours is more thorough and practical than many — is more of an explanation of where you saw those errors and your courses to redress them. I think it further enhances the public credibility, which is already high, of Elections B.C.

My second question is with respect to your special projects and your audits from that budget line. Do you see the need to increase the amount of audits as you increase the availability of voting options — ones that go away from the traditional "show your ID at the voting booth" to various other methods — to maintain the integrity of the voting system so that people aren't finding ways of encouraging in-home balloting and things like that? Can you express a comment to the Legislature that you're as confident as ever there are no opportunities for abuses to increase or exist at all in the voting system? Have you thought about that?

R. Patterson: Certainly, our system is probably — let's boast — one of the best in Canada in that respect, because we do have the signatures available on file. Whenever there may be a challenge to improper voting or double voting, we have, as a result of voter registration cards, the voter's signature on file. We can go back to that original documentation to satisfy ourselves as to whether or not there has been impersonation or double voting.

Clearly, the issue of absentee voting and postal voting is one we're very conscious of. We are aware of the abuses we see and hear about in the United States, so we are very rigorous in pursuing those voting options to ensure there is integrity in them.

B. Penner: I have a number of questions. Just to follow up on Jeff's question about the multiple forms of voting, I thought I understood the process fairly well in 1996. I discovered this time out, in 2001, that in fact there were other forms of voting available I'd never heard of. For example, a couple of people apparently voted from South Carolina with the mail-in ballot. They had that ballot mailed to them by the returning officer. I didn't know that was an option available.

I was also surprised — and it only came to my attention because of some of the close races here in the capital regional district — that not only can people vote at a different returning station than they're supposed to, but even if they're outside of their constituency or a particular riding, they can still cast a ballot. I always thought that if you were going to be outside of your electoral district on the day of the election, you had to avail yourself of advanced voting prior to the election. That came as a surprise to me.

The point of this interjection is that it seems to me there are an inordinate number of different ways to vote. I'm wondering if it's within your mandate or purview to make recommendations to the minister responsible for the Election Act to pare it down somewhat or if you would consider that appropriate. I'm just worried that with so many different avenues, it becomes more cumbersome, from an administrative standpoint, to ensure that there is compliance and that abuses aren't taking place. I know you say you enforce it vigorously. I wonder if you could tell us how often you conduct audits or find problems.

R. Patterson: Certainly. Following every election we scan every voting book that is used at every voting place to identify who has voted and who has not voted. We flag every voter record on the voters list system as to whether they are a voter or a non-voter. Where there may be some detection that perhaps there was a double voting, we investigate every one of those.

L. Johnson: The absentee votes you refer to — and there are a lot of different options — represent about 5 percent of voters provincewide. Before those votes are counted, they are all put through a rigorous screening process. That's what our final count process is about. They're screened at that point to make sure this person didn't go to advanced voting and vote there and then

attempt to vote at another location. There are a lot of safeguards built right into the system itself. Post-event we do this duplicate-checking routine.

I currently have about ten files where it looks like people voted twice. Seven of those files, if my memory serves properly, are very elderly people. What appears to have happened is they are living in a facility, and a well-intended family member came and got them and took them to vote through another mechanism. Then we sent a team into that facility. Now, they didn't get two votes counted, because of all the safeguards in the process. One of those votes, by nature of how they voted, was in an envelope and it was caught. So I'd question the value in prosecuting these people in their nineties. Statistically, it doesn't happen.

With the other three we haven't figured out what happened. It looks like it was voter error or confusion that contributed to that — a first-timer who wasn't clear on what they were doing or people with language barriers. It isn't really a measurable problem. Although British Columbians do enjoy a very extensive range of options around how they can cast their votes — and I think that contributes to the high turnout levels we have — there are a lot of safeguards right in the system that are invisible to most voters and that prevent people from actually being able to vote twice and have two ballots counted.

R. Patterson: I think that even though there are a vast number of voting options, it's important to weigh the right to vote and what the extra cost is for this multiplicity of opportunities. The additional costs are really insignificant compared to the overall costs of an election.

B. Penner: Just a point of clarification. If I am registered in advance and I receive a voter card in the mail telling me which returning office or polling station to go to, do I also need to bring personal identification in addition to that voter card?

B. Penner: This gives me some concern. If I were living in a residence with various room-mates, it would be possible, if I were malevolent, to take my room-mates' voter cards off the fridge — where in people's homes I've often seen them attached with a magnet — wander into the polling station and simply produce that other person's voting card, and there is no secondary check done by way of a request for photo ID. The lack of that requirement for some secondary form of identification gives me some concern. My question to you, in terms of that issue and others about these other forms of voting is: are you making any specific recommendations for change to the legislation?

R. Patterson: We haven't considered that at this point in time because it hasn't been an issue. The situation you describe, where someone may come in and vote — impersonate another individual — we don't hear about. We haven't received complaints where someone has come in and found their name has been struck off. What they actually have found is that someone has struck off the name above or below where the other voter was voting. It's insignificant. It statistically doesn't exist. In fact, I haven't heard of a case whereby there has been impersonation.

We're very reluctant to put barriers in place for the people who come to vote. Some individuals don't have photo ID, so what would they come up with? At this point in time, without it being a problem, I don't know that we would be recommending the requirement for photo ID for everybody.

B. Penner: Okay. A couple more, if I may. You mentioned less maintenance. I'm just curious if that $1.5 million annual expenditure is something you do in-house, or is that a contracted service?

L. Johnson: That represents the costs of us receiving files, for example, from ICBC through the motor voter program, and doing automatic updates. A lot of this is automated now. Our vital statistics reports we get regularly, and we remove deceased persons from the list. Now there's this multiple-address-change website the government has set up, and we're getting a fair amount of input for that. A lot of that activity is actually all computer-run data matching.

However, when you get mismatches — and you've got 2.25 million voters, and a lot of them are named George Smith — we then have our staff intervene and they can use signatures, if they have those available on a change-of-address card, or look at historical information on the voter record to determine which George Smith we're talking about. So some of it's done in-house. An awful lot of it, though, is automated.

B. Penner: I appreciate the tremendous challenge in attempting to keep lists up to date. On a much, much smaller scale, we have a membership list in the riding that at one time was over 2,000, and that was a huge challenge to try and maintain. You're always out of date. I can only imagine what it must be like with millions of registered voters to try and keep that up to date. I know you're not always successful, because as you mentioned, we sometimes take advantage of the list for mailing purposes, and we get many returns.

I am concerned about your comment about the difficulty in accessing the federal list for cross-reference purposes. I hope you can explain for me a bit more about how it's used for juror selection or how the fact that it is used for juror selection in B.C. — that is, the B.C. list — precludes you from accessing the federal list. I noted in your service plan an intention to have a briefing note prepared on this issue by June 30, 2002.

I'm somewhat curious why it would take that long to get a briefing note together on this issue.

Perhaps you can tell me why there's a problem accessing the federal list and why we couldn't, on a provincial basis, do something similar to what happens at the federal level with your income tax return. You simply tick it off, and every year you can update your federal election registration at the same time you file your income tax.

R. Patterson: We could get access to the tax rolls if our list were used only for electoral purposes. When you're doing your taxes for this coming year, you'll note the box…. As a matter of fact, Elections Canada has just struck a new partnership agreement with CCRA, Canada Customs and Revenue Agency, whereby not only will they now get changes of address but people will be able to have their names added to the national register. That was not possible before.

Again, it is precluded because only information that is going to be used for electoral purposes can be transferred from Canada Customs and Revenue to Elections Canada. They then, as part of their agreement, can only provide it to the provinces if those voters lists or the voter information is going to be used for electoral purposes. Under our Election Act we have to provide the list for jury selection purposes. Because it's used for other than electoral purposes, we cannot get access to the federal information.

Our list is also used for other purposes — for example, maintenance enforcement. We did look at this issue a couple of years ago, and we were able to resolve the family maintenance enforcement issue. They saw no problem in us being dropped off their list as far as accessible sources and information. The only one that caused a problem was the jury selection. The sheriff's department felt that there was no other list that they could use to create a jury selection pool from. Until that is resolved or some other source is provided to the sheriffs, we're in this box.

L. Johnson: That's why I allowed so much time to prepare the briefing note. Rather than go with this dangling problem of what an alternate source of jury selection might be, we need to work with the court folks on identifying the implications for them of losing access to the list and what the cost will be of a replacement model for them. To do a really thorough job, it involves consultation with both Elections Canada and with court services.

B. Penner: Thank you. I think my biggest interest and concern when it comes to Elections B.C. is the whole issue of getting as many people registered as possible and keeping that information as up to date as possible. I know it's never going to be perfect. You could update it today completely, and tomorrow it's out of date when somebody moves or passes away. That's the challenge, and I'm glad you have it.

I did have another question, but I think I'll just ask for. I noticed the previous presenters provided us with a chart going back about five years of budgeted expenses versus actual expenses for their operations. I'm wondering how you've performed over the last number of years in terms of meeting your budgeted goals. If maybe Nola Western could speak to that, that would be helpful, and then I'll turn the floor back over to the Chair.

N. Western: I apologize that I don't have the numbers in front of me, but we have consistently in the last five years come under budget. Even during the 1996 election, that year — '96-97 — we were under budget. We are very frugal. I would encourage you to come and see our office: the equipment, the furniture and the space that we're in. We're usually under budget, and we should be again this year.

R. Patterson: If I might, I have one thing to go back to. It's your last point, Mr. Penner, with respect to getting people on the voters list and access to federal data. Elections Canada also has access, through Citizenship and Immigration Canada, to information with respect to citizenship court and all new citizens. We would also get that information if we were able to access the federal list.

B. Lekstrom (Chair): I do have two further speakers wishing to ask questions.

I. Chong: Thank you, Mr. Patterson, for presenting today. I'm just looking over your briefing note that you gave here. On page 2, almost two-thirds of the way down, you mention the ability to make regulation. However, before doing so, you must consult with the Election Advisory Committee.

I. Chong: Can you advise me who serves on that committee and how that committee is struck?

R. Patterson: Certainly. It's in the statute. It states that each party represented in the Legislature is entitled to two members on this committee. Any other political party that ran candidates in at least 50 percent of the electoral districts but did not elect a member is also entitled. Currently, the parties entitled to membership on this committee are the Liberal Party, the New Democratic Party, the Green Party, the Marijuana Party and the Unity Party. Those are the members. It is an advisory committee.

I. Chong: Okay. You also indicated you had internal issues, which I appreciate that you highlighted for

us, and opportunities as well. I'm wondering whether you've been able to determine what kind of cost savings will be available with the fixed election dates.

R. Patterson: One prime example is the costs involved in creating our media or advertising plan. With an unknown election with an uncertain date, we have to plan an advertising strategy based on six days of the week. The advertising agency we work with has to expend the money to prepare that. Instead of having one advertising calendar based on Tuesday, May 17, 2005, we have to create six advertising strategies based on whatever day of the week. That's one small example.

Certainly the training and the planning can be much better scheduled with respect to our staff, to prepare for the election. Voter registration activities can be better planned. We don't have to overstaff or to consider, if I can use the term, oversupplying voter registration centres during an election. If we can, say, in the three or four months in advance of an election strategically do voter registration based on where we see, looking at the list, deficiencies in the list, perhaps we could do some targeted enumerations. We can save some money there as well.

L. Johnson: I don't expect that it will translate into really any significant cost savings. The benefit of having a fixed date is that when we go out to negotiate our temporary leases, we can probably get a little more favourable rate there. It's incremental.

When we are trying to book our voting places, we can potentially get better voting places, because we can tell them when we need them. We may be able to get better-quality staff working at those voting places, because people can plan around it. Although it's going to potentially bring efficiency — certainly from our perspective working towards a fixed target is way easier — I think the benefits are largely going to be potentially better voting places with better-trained staff in them, which addresses some of Mr. Bray's concerns about the mistakes that get made at voting places.

There will be some savings. As I mentioned, we might be able to negotiate favourable rates. Certainly for booking our TV and radio ads we'll be able to negotiate far better rates than we can now. We pay a premium to book those at the very last minute, but it's going to be pretty tough to put a dollar figure on that.

I. Chong: Okay. I just thought that's how you would incorporate planning for your budget. Based on not knowing in the year 2000, from what I gathered, you had booked space in anticipation of an election, not knowing when that election would be. You would have had space rented and paid for, perhaps, for a period of time. You will clearly not have that. You can do your RFPs to get advertising costs, things like that, knowing how much you will need to do. I would anticipate your budget — which would actually be the '05-06 budget, I guess — will have a somewhat lesser amount you would require.

The other area I wanted to canvass quickly was the case involving overspending that I noticed in your annual report — in particular, the case of Mr. Vander Zalm, where the penalty was assessed and then the courts stayed the amount. I'm wondering, in a situation like that, if you were, in fact, able to collect that penalty, where would that fund go. Would it go back to you, or would it go into CRF?

I. Chong: Okay. The costs associated — on page 12, "Investigations" — with a case like that where you had retained a forensic accounting firm, do you actually budget for that within your budget — for outside consultants, outside professionals?

N. Western: We did the year we had the recall investigations. Last year, no, we didn't. This year, I'm not sure whether we will or not. We're only just over half way through. We did certainly use it up the year we had the recall investigations, but that was an unusual year and a large investigation.

I. Chong: Okay. I know people have tendencies in their budgets to put an amount in every year for a particular item just to have it in hand. That becomes their cushion and their contingency. Certainly if we're looking at ways to help you trim your budget, we'll want to look at all those kinds of categories.

The last item in your annual report, on page 22, you mention this particular case: Pacific Press v. Attorney General of B.C. It had to do with the third-party spending. Your last paragraph there: "Elections B.C. was not involved in the proceedings, but the outcome of the case has significant administrative implications for this office." Would it also have significant financial implications, and if so, how have you addressed that in your budget?

N. Western: Not significant financial implications, because what it is, is that the third-party election advertisers no longer have a spending limit. The $5,000 expense limit was thrown out by the courts, but they

still have to register with us, and they still have to file disclosure reports with us. That's where the cost to us is incurred. It doesn't matter to us what the spending limit is for them. That doesn't cost us anything.

I. Chong: Okay, and for your 48 FTEs that you currently have, have you looked at or identified any positions that could be viewed as excess or redundant? Where have you looked or tried to identify where positions can be amalgamated or even where people's time can be better used so that it actually reduces your other overall costs?

R. Patterson: Certainly we have looked at the entire organization. We've mentioned the bringing together of the various offices we have here in Victoria to, we hope, see some efficiencies there. If we can move around some of the job functions, that may result in the ability to not fill some vacancies we currently have.

We are running very close to the vest with respect to just the 48 FTEs. We haven't set out to say that we no longer need this function. I think with everything we do — the functions we need — that I don't see right now that there are positions we would chop from our organization chart. As I say, it may be possible, if there are some efficiencies with moving. I believe you heard earlier this morning that the officers are looking at bringing in a consultant to see where we can perhaps share some administrative services with respect to HR and payroll. If that comes about, then we may be able to see some savings there as far as FTEs go.

I. Chong: One final thing: in terms of occupancy, building space, have you looked at other independent statutory offices that you could share office space with to get better rates on rents, things like that?

N. Western: I think that will be part of what the consultant the office of the auditor general is hiring looks at — whether we should share physical space.

B. Kerr: Just a couple of quick questions. Maybe I was sleeping when you mentioned about capital expenditure projects. I'm wondering why your capital expenditures are so high year after year.

N. Western: It's quite high in the current year because we're working on our election information system, and it isn't complete yet. That's why the current year is quite high. Next year it goes down. We're almost finished the EIS. We've still got some work enhancements to do next year. The event management infrastructure capital is tenant improvements if we move into a BCBC-owned building and furniture for our move. That's the one-time move cost Linda referred to. That's why it's high that year, and then you see it start to go down.

N. Western: That's the ongoing election information system work, the ongoing PCs for the DEO offices and that sort of infrastructure.

B. Kerr: I notice your amortization is quite high. Is that because you're amortizing the software or hardware?

N. Western: We have to amortize software and PCs over three years. The election information system, which is a $9 million project, is over only five. Same with the tenant improvements; there's only a five-year amortization. It's a pretty fast rate.

B. Kerr: Getting on to your list maintenance, essentially it's $10 million over four years. That's ongoing. Then you're doing your enumeration essentially every four years now. Is there some other way that you can pass on the responsibility, let's say to the individual, to keep it up as opposed to spending $1.5 million per year and then another $4.5 million to do an enumeration? We can go outside the box a little bit here and save some money.

R. Patterson: Exactly. It is a concern that we have. In fact, the Election Act does provide that if the chief electoral officer is sufficiently satisfied the list is relatively current, they can recommend the enumeration not take place. If we can get access to, as we talked about earlier, federal information and data to allow us to access more information and keep the list more current, we perhaps can say: "We don't have to do the enumeration." We can save that $4.5 million because the list is current enough.

N. Western: I'd also like to point out that of the $1.5 million in list maintenance, almost $700,000 of that is ITSD cycle charges for the mainframe computer that produces the reports up at 800 Seymour.

B. Kerr: Okay. Then the financial statements you've given us in your budget here are sort of function statements or division statements. How are the other ones? Do you do this normally, this method here, or do you break it down by function?

N. Western: The event management infrastructure budget we have by STOB, but traditionally we have never broken down the statutory activities into STOB level. This is what we've always provided to Treasury Board and Treasury Board staff.

B. Kerr: Okay. Somebody else mentioned it, and I'd like to see the previous year just to see how it does compare.

B. Lekstrom (Chair): If you're putting that information together, forward it to Craig. He can make sure that all members of the committee will receive it. Thank you.

J. MacPhail: I'm sorry; I missed the beginning of your presentation. My apologies.

I note that there's a difference of about $5 million between a referendum expense and a general election expense. The referendum is $18 million and the general election $23 million. What accounts for the $5 million differential?

R. Patterson: Much of that is the costs. The $23 million was a budget, and I believe that we're looking at coming in around $18 million or $19 million. We budgeted $23 million, but our actual costs are probably in the neighbourhood of $18 million or $19 million. That's why we put in $18 million for the referendum.

L. Johnson: Just to clarify, that $18 million we have targeted for the referendum is assuming a ballot box vote. It's pared down a little from our general election cost, because we anticipate doing less advertising from Elections B.C. — scaling back voter registration activities in advance of the event because it would be within a year of the general election. There are some very nominal costs associated with candidate services during an event. That's why it's somewhat less.

K. Krueger: I think it's amazing that you run on 48 staff between elections. It reminds me of the flowers in the desert analogy, where you don't see any until it rains after years and then suddenly they're everywhere and then they're gone again. To ratchet up to 30,000 must be a mind-boggling exercise. Well done.

You didn't give us an organizational chart in the package, and that would be helpful when we're looking at the budget. I wondered if you could somehow break your budget down between the expenses you know you're going to have — your fixed expenses for your staff, overhead, and so on — versus the ones where you have to have this large buffer for events that you anticipate, like the by-elections that on average will come once a year, and so on. That might be helpful to us.

We are particularly interested in seeing shared services. In the ombudsman's report just before you, he had a human resources senior manager who also did finance. It's only a unit of 50 people. Yours apparently is 48 in the off-years. There are things like clerical support, systems support, various types of management where we are hoping the officers of the Legislature at least, and perhaps even at a larger level in government for things like payroll, can find significant savings. You've already said you're looking at that. You have a consultant working between the officers of the Legislature. We'd really like to see movement in that direction.

I'll just give you a chance to answer anything there that you'd like to comment on.

R. Patterson: With respect to the consultant, we are very interested in doing that. Where we can share services I think it would be a benefit to all of us, because certainly we do not have human resources experts in our office. If we can, through an amalgamation, have access to a human resources specialist, that would be of great benefit to us. I think we could share the costs of that, as well as other infrastructure positions that would be of benefit. Certainly we will provide the organization charts and the budget as you requested.

K. Krueger: Are there any candidates who have still not fulfilled their reporting requirements from the last election?

N. Western: All the candidates except one filed their financial reports on time. We're still reviewing those reports and dealing with the financial agents about corrections or minor errors or omissions.

N. Western: Yes, and he will not be able to file now unless he pays a $10,000 late filing fee.

N. Western: I don't know. He was an independent candidate. The penalty for him is that he will not be able to run until after the next general election. That's the only penalty under the legislation.

B. Penner: Just one point of clarification. Did I hear you say that all but one candidate had filed on time? I remember reading some media accounts that indicated a number of people, including some people who had been MLAs going into the election had missed the deadline for filing their election expense report.

N. Western: Some had filing extensions. The chief electoral officer can issue extensions to the deadline if there are extenuating circumstances, so there were some who had extensions. This election, everybody filed on time. They met their deadline. The last election was a different matter.

I. Chong: I'm curious as to how often in the past — and I don't know if you can go back five or ten years to take into consideration two elections — you have ever assessed a penalty and actually collected on a penalty by virtue of assessing it or imposing it. Do those therefore who don't wish to pay it just walk away? Do you actually get any money out of imposing a penalty, or are we just chasing our tails here?

N. Western: There are late filing fees for parties, constituency associations and candidates. This has only been in place since 1995. The first year in which there were any filing requirements was 1996. We assessed and collected late filing fees from several candidates in 1996 and several constituency associations and parties in '96, '97 and '98. Since about 1999 — and I'm not ex-

actly sure of the dates — virtually all constituency associations and parties have made their annual financial report deadline on time. I think the compliance rate has increased dramatically. We haven't assessed any penalties or received any for a couple of years.

I. Chong: The penalty you just spoke of is the example I'm trying to use. You're saying this person would have to pay $10,000. Obviously it's looking like he or she is not going to pay the $10,000 and would rather just skip an election in that case. Those were the instances I was looking at, whether there has been more than one instance where a penalty was imminent.

N. Western: It's not a penalty. The $10,000 is not a penalty. It's a late filing fee.

I. Chong: I noticed in the book that you also grant filing extensions. Do those come with an incremental cost every time an extension is granted?

B. Lekstrom (Chair): All right. I see no further questions from members of our committee. Linda, Nola, Bob, I would like to thank you for coming forward and making your presentation today. We will take the information you have given us in our deliberations into the development of our report.

Just in closing I want to state that certainly the job you do is of vital importance. When you look at the numbers, at roughly 71 percent of the people getting out to vote, we've got some work to do on the 29 percent. Far too often I think as a society we take for granted the democracy we enjoy. Look around the world to other countries that don't enjoy what we have. For the people who haven't felt it important enough to get out, I think you're certainly doing your job in informing them on how to get out, where to go and what to do. I think they're going to have to look at themselves and try and take the active role we all wish they would.

R. Patterson: Thank you very much for the opportunity to come before you. As we mentioned earlier, we certainly have an open-door invitation to anybody who wishes to come by and see how Elections B.C. operates on the ground.

We will take a ten-minute recess. We will reconvene at 2 p.m. with the auditor general of British Columbia reporting to the committee.

J. MacPhail: Mr. Chair, if we have time, or at some opportunity, I'd like to discuss the letter that you sent. I'm just not clear on how the system is working now. I wasn't aware these matters were going to be referred to the Legislative Assembly Management Committee.

B. Lekstrom (Chair): Okay. Could we possibly have a small committee meeting to deal with that following the next presenter? That would be more appropriate. I've got to take five minutes here, at this point.

J. MacPhail: Okay. I just wanted to clarify that before we proceed after today, though.

B. Lekstrom (Chair): Good afternoon. At this time we will reconvene the meeting of the Select Standing Committee on Finance and Government Services and move on to our next presenter this afternoon, who is Mr. Wayne Strelioff, the auditor general of British Columbia. Accompanying Wayne is the deputy, Peter Gregory.

Good afternoon and welcome. We did have the opportunity to briefly speak about the issue the other day and certainly to discuss the time frames that were so tight. I appreciate your effort in being able to appear here today to present the overview of your office as well as your strategic plan and the funding required for your office.

My name is Blair Lekstrom, Chair of the Select Standing Committee on Finance and Government Services and MLA for Peace River South. Just prior to going into your presentation, Wayne, I would ask the other members of the committee to briefly identify themselves, as well, beginning with Brian.

T. Bhullar (Deputy Chair): Tony Bhullar from Surrey-Newton, and Deputy Chair of the Finance Committee.

B. Lekstrom (Chair): With that, before I hand it over to yourself, this is a new process for yourselves

and ourselves. We're looking forward to learning from you and what you have to say and the direction that you see yourself taking with your office. As a committee we will be producing a report at the end. Once it's filed and submitted to the Clerk, it becomes a public document. With that, Wayne, I will turn it over to yourself.

W. Strelioff: Thank you very much and good afternoon. This is an important change in what happens to the officers of the Legislative Assembly. I'm sure my colleagues advised you this morning that it's one we all support. We do work for and with the legislators. This change is a signal that we now come to a group of legislators to talk about our funding and work. Also, for me this is an important opportunity to listen to your advice on our future plans and priorities.

In general, as you no doubt know, your responsibility to ensure a rigorous and objective public scrutiny of the performance of government is particularly important now, with the changes moving through the public sector in B.C. The need to have and demonstrate a rigorous and objective public scrutiny is just so critical.

Normally what happened in the past years in British Columbia — it's different in other jurisdictions — was that the funding discussion with our office was in the context of direction from Treasury Board or the government of the day. In the past, one day we would be tabling a report discussing the performance of the government. The next day we would be coming in to the chief senior management group of government discussing funding for the future. It does make a lot of sense to move that discussion to directly with whom we work, the legislators, because this is one of the mechanisms you have to get independent evidence-based information about the performance of government. That's what we do.

In your material, which I can see is piling up, we have provided you with three key documents. One is the annual report on our operations for March 31, 2001. That's the annual report of last year. Second is the performance plan we prepared last year, titled Performance Plan 2001-2004. Those two documents provide a lot of specific information on our past performance and our future direction, goals, objectives, strategies, work programs and targets. The third document, which we provided you five minutes ago, is a ten-page document. That's going to be the focus of my presentation today. It's called Strategic Direction and Funding Proposal, dated November 2001.

Once your committee advises us as to what funding you're going to be recommending for our office, we will then prepare and table our service plan. As you know, the service plans of government organizations are to be tabled publicly, I think in March or once the budget is presented. We plan to do the same. My understanding also is that our service plan gets referred to this committee, so once that happens, you have another opportunity to call us in and talk about how we're bringing to life our work program, once we know the direction on funding.

Now, as you've mentioned, with me today are Peter Gregory as well as Jane McCannell, right directly behind me, and Bill Gilhooly. Peter is the deputy auditor general. Most of the members here are also on the Public Accounts Committee, and we've met in that context. Peter, again, is the deputy auditor general. Jane McCannell is our person in charge of corporate services, and she carries out audits as well. Bill Gilhooly is the person who leads our internal management information services. Bill has recently moved from operations, to have that experience within our office for the next couple of years.

Once again I'm going to be focusing on the document entitled Strategic Direction and Funding Proposal. I will explain our thinking and direction and why, but I also really want to listen to the discussion of your assurance and advisory needs that can shape our work program, and very much so.

At the Public Accounts Committee we did go through about a one-hour presentation on how we work, how the office is structured, some of the reports we've issued in the past and our relationship with the Public Accounts Committee. I'm not going to dwell on that today. I'm going to move right to what our thinking is on the future.

In the context of our primary goal, it's that legislators and the public receive the best information possible for assessing the performance of government. That's our direction; that's what we're trying to work towards.

As you know, certainly better than I do, demand is particularly high. The public expectations are high that government management and accountability practices will strengthen and that we're going to be putting in place a more meaningful opportunity for both legislators and B.C. citizens to participate in government decision-making. Certainly your responsibilities on the budget consultation process — this is the second year that has happened — are an important part of that more meaningful opportunity. How do we as people who work for you assist you and help you carry out that rigorous public scrutiny of government performance.

We think our work contributes to that significantly. We do so by trying to ensure that credible and meaningful information on the performance of government is made available to you. As I mentioned before, I think public scrutiny is very important now, given the transition it looks like government is going to go through, which involves accepting management risks. Given the financial pressures and the economic uncertainty and, also, given the unusual representation in the House, demonstrating that a rigorous, objective public scrutiny takes place is what you have to do. We're here to try to help you do that.

As the changes in the public sector unfold, new risks will emerge that need to be managed well and mitigated. Moving to a focus on results means there are going to be less central controls in return for stronger statements of accountability on performance. The credibility and reliability of that information is going to

be particularly important. The transition in moving to expectations on accountability for results and giving up input controls or central controls means the performance information you expect and receive from government organizations is going to be particularly important.

Reducing the size of the public sector. That's going to have an impact on how government manages the change. Corporate memory is going to be lost. Alternative service delivery methods are going to be put in place. Again, the importance of making sure that you know that government is managing those risks in a strong and careful way will be particularly important in these next few years.

For many years legislators and our office have expressed concern that decisions have been made and risks accepted by government without good credible cost and performance information. That's happened. The government, for example, does not yet use a complete financial planning and reporting framework; it's not there yet. There's incomplete information on cost and intended results. That's the longer term. How do we get to clear statements of intended results? We're not sure whether the performance information you do receive is reliable. Resources are allocated within key programs of government, like health, without the benefit of essential cost and performance information.

You're being asked now — and past legislators, as well, have been asked — to make or support decisions without complete information, without knowing whether the information provided is reliable or whether the government itself has the capacity to deliver the programs and services being promised. On the other hand, you've been putting in place strong steps to make progress on these issues. The Budget Transparency and Accountability Act introduced about a year and a half ago was a key initiative that was advocated by legislators for years. If you remember, at the Public Accounts Committee I mentioned that the Public Accounts Committee of years ago, particularly under the leadership of Mr. Gingell, went a long way to advocate changes to how our system of accountability works, particularly advocating a stronger role for legislators. This meeting is an example of what he was advocating.

You've also put in place the expectations that service plans and performance reports of all government will be provided to you in a public way, with most of them referred to standing committees. Those are important steps along the way to a stronger public scrutiny of government performance.

You've also directed the government to implement a complete financial planning and reporting framework by April 2004 — I think that's the end point when it should be fully in place — and, of course, a more active system of standing committees. All are good steps designed to strengthen our system of accountability and strengthen the demonstration that a rigorous, objective public scrutiny of the performance of government does take place.

We have four lines of business. We attest to the reliability of government financial statements, we assess the quality of service plans and reports, we examine how government manages key risks, and we support you as legislators — particularly the work with the Public Accounts Committee — in your use of government performance information.

Our priorities, which we have set out in our planning documents in the past year, are to continue to encourage the implementation of that complete financial planning and reporting framework. It's really important to get complete cost information and other kinds of performance information you can rely on.

Focus on the risk management practices within the health and education communities. We have to make choices with limited resources. That's where our focus is going to be: on risk management, particularly in the health and education sectors.

Examine and monitor the management of large capital projects and the ever-ongoing, complex, mission-critical information systems that government has to manage — creates, modernizes, changes and looks after.

Focus on building our capacity and carrying out examinations related to the risks to the environment, how government is managing those risks as well as the progress towards sustainability.

At all occasions encourage a results-focused performance management reporting system be put in place.

We continue to shape our work program within our office to make sure we can move on these priorities as strongly as possible. Steps we have taken include changing our organizational structure to focus on the key programs of government so that we develop the necessary expertise in a focused way; redesigning our work so that we're able to put more efforts on assessing how government manages key risks; building our knowledge and expertise with respect to the results-focused performance reporting — there is much going on across Canada and elsewhere in that area; and continuing to advocate an update of our mandate through the revisions to the Auditor General Act.

Within the first line of business, a key part of what we do is assess and report on the reliability of the overall financial statements of government to make sure they have surplus deficit measures that are as reliable as possible. That's a key issue all the time, and it's always subject to a lot of complex transactions, which we sort through with management. We also will be encouraging the government to prepare financial statements for you for each of the key sectors of government so that you can get a financial overview of the health sector and the education sector. That's not provided to you now — a clean, understandable financial overview.

The second line of business is assessing the quality of service plans and reports. As you know, the government has asked us to even develop an approach to auditing the annual reports of government organizations, and the performance reporting within those is going to be a particularly difficult challenge.

Examining how government manages its key risks is one of the things we do — risks meaning that in successfully achieving your objectives, what you have to manage well to be successful and how you know that management has good practices in place.

Supporting you as legislators, primarily in the context of the Public Accounts Committee but also as the new standing committees emerge and get more comfortable and there's more understanding as to what their particular roles are. We certainly welcome the opportunity to help those committees as well.

The second goal of our office is more internally focused, dealing with wanting to make sure our organization is as strong as possible, that we are an exemplary organization serving the assembly and the public. We have specific, ongoing initiatives in place to make sure we do this on an ongoing basis as part of our internal management.

During this year, 2001-02, our funding was increased. That was the first time in many years, to my understanding, so this year was the first time we were able to stop the erosion of our capacity to serve you. For many years our funding had not kept up with the increased complexity and size of government and, of course, the growing demands and expectations of legislators and the public. One of our highlights and key initiatives in 2001, this year, is meeting the new and more demanding deadlines for carrying out our audits, particularly of financial statements, to meet those June 30 deadlines, which keep getting tighter and tighter.

A report will be coming out soon assessing the overall quality of the government's performance plans and reports issued in '01-02. We have been contributing to the development of general principles for performance reporting on a Canadian basis, which will serve the long-term interests of how best to prepare service plans and reports. We have been working on how best to assess the information that was agreed to in the health sector by the federal and provincial governments. As you probably know, all the provincial governments have agreed to begin to publish specific indicators on the health system's performance. As a community of legislative auditors we're getting together to make sure we contribute to those reports.

We also have carried out quite a few significant risk management examinations related to TransLink, related to resource allocation in the health sector and to the attributes of a healthy working environment that one would expect to be in place to ensure good quality service to the public, as well as assessed control environments and building our capacity to begin to examine, in a stronger way, the environmental risk management practices of government. In our next annual report we'll no doubt describe in more detail our performance on what we did this year. This year's not over, of course. That report isn't due until June.

We continue to reshape our businesses. For next year we think that we do not require an increase in our appropriation. We anticipate that our work program will end up having less funding from recoveries. We do charge for work requested of us by government officials as well as on audits that we do of individual government organizations. That funding is going to be reduced next year, primarily because we don't anticipate a similar examination to what was requested on TransLink, which was about a $300,000 examination. There are some government organizations that aren't going to exist, so that reduces the work we'll do. As well, we are trying to change our approach to how we oversee the audits of financial statements of all government organizations.

For this next year and the future, though, we do say there are three emerging challenges coming to the fore. Our current understanding for '02-03 is that those challenges won't affect our work program significantly, because they're just not there yet.

The first one is implementing a complete financial planning and reporting framework through the adoption of generally accepted accounting principles. That leads to bringing together the health authorities and the education sector into a stronger financial reporting framework. My understanding is that's not going to proceed too quickly; it's not going to proceed this year. In legislation you've said you want it done by April of 2004, so our assumption for this next year is there's going to be little progress. That's not the approach we're recommending, but we haven't seen any indication there's going to be a strong step forward on making sure that actually happens. If it does happen, we do ask you to consider providing us contingency funding of $200,000 that we would use if our understanding of what's going on in expanding or building a stronger financial management framework takes place at a faster pace than we assume right now. Right now we don't assume there's going to be much progress during this next year, just from our reading of what we've heard to date.

The second emerging challenge is the assurance on government service plan reports. As you know, by legislation all organizations of government have to provide you with service plans and service plan reports. This is new age, so these are new initiatives. The government has said they wanted us to audit these performance reports, and we think that's a good idea. But we don't think next year is going to be the time, because the first service plan reports on the service plans that are going to be tabled in February-March won't be ready until next year. That's when we're thinking is the time to get more focused on making sure those reports are as reliable and as strong as possible and on actually examining the reports of key sectors. Again, we ask you to consider a contingency funding of $300,000 that we would use if there are opportunities arising to make progress towards assessing these performance reports coming out in the next year or so. Right now we don't think it's the time. We think '03-04 is when there's really going to be a demand.

The third emerging challenge is that government leaders are stating there'll be significant changes happening. We don't know — I don't know — the extent to which those changes are going to happen and over what time period. We do know they will affect your information needs and therefore our work. As I said

before, when any organization goes through significant changes, risks emerge that governance communities like you need to know are well managed. In 2003 or the next year we do plan on examining three key risks that relate to the unfolding new realities. The first one relates to whether government has identified and put in place effective mechanisms to manage and deliver programs when there is a significant organizational change — the key risks we'll be examining.

The second one has to do with new service delivery arrangements, particularly with non-government organizations. If new service delivery arrangements are going to be put in place, I'm sure you will want to know whether what's asked to be delivered actually gets delivered and whether management knows that is actually taking place.

The third one relates to whether the new public sector pension arrangements that have been put in place in the last year have adequately addressed accountability and risk management issues. There has been some significant change to the public sector pension plan arrangements — very significant — and we're going to examine just what the accountability and risk management steps are for those arrangements.

Our work program for next year does not include examining change to our system of health. We don't know whether change to health governance is going to be put in place. We understand it is going to happen, but we have not put in our work program to examine the associated risks related to that change in governance. We think it's more likely to be relevant in the next two years after that, not this year. Again, if it does happen more quickly than we know now and if the community changes from 50 different organizations to ten or some other number, that's a significant change. I'm sure the information on how that's being managed will be important to you.

We're also putting on the table two new assurances and asking you for your advice and support on it. The assurances relate to the reliability of the annual financial plan — the budget — and the interim quarterly financial forecasts provided by government. Part of this meeting is to seek your advice on these. What I see happening is that when the government's annual financial results…. I mean, they always vary significantly from what's in the annual financial plan. They vary significantly from what's in the quarterly forecasts. When this happens, I hear, I see, I read about legislators and B.C. people questioning whether those variances are due to real economic events or due to the use of incomplete and inconsistent information and accounting policies.

Now, auditor association with quarterly reports and future forecasts is common in the private sector. We're proposing we step forward to do that here. There is some practice in other jurisdictions. It would be leading edge. There isn't that much practice to draw upon in other jurisdictions in terms of the public sector, but we're asking for your advice and support on this initiative.

If you support it, I ask you to provide us an increase in the funding over the next three years of $250,000 in this coming year, $100,000 the next year and $150,000 in the third year. What we would deliver is working toward providing you such assurances in three years, but we need your support on this. This is something we can't just do ourselves. We would need you to say to the government of the day: "Please work with the auditor general to make sure this happens." When we present our annual financial plan, we want to make sure there's more confidence that the change in the results — and no doubt, the actual results always change — is due to real economic events and decisions, not due to changes in accounting policies.

Future challenges. The direction we've got on the table is one we're continuing to work toward. In the second and third years the key issues will be to actually address those emerging challenges that we think this next year won't quite be ready, particularly as they relates to the full financial framework, the assurance on government service plans and some of the significant changes to how public programs and services are delivered.

Our recommendations are set out near the end. We're asking you to support our appropriation of $8.567 million. We also ask you to ensure the recoveries, which we estimate to be having in the next year, are included in our estimates and also an amount for our capital expenditures. We do have a brief summary of what those appropriations relate to as well as a more detailed schedule of our financial forecasts and actual results for the last few years and our plan for the next few years.

That ends my discussion of what's in this document. I'm certainly here to answer your questions. I also want your advice on your priorities so that as we shape our work program, we meet what you think is needed.

B. Lekstrom (Chair): Thank you, Wayne. I do have a couple of speakers wishing to ask questions.

K. Krueger: You've given us substantial food for thought, and we'll certainly have further meetings and further exchanges.

You recognize, obviously, that while government is moving to diminish its size and cost, you're asking for an increased budget to audit essentially a smaller government — and you've given lots of good reasons for that — but it is moving in the opposite direction of what is being presented as a challenge right across government. The most salient example is probably the matter discussed in the media today from yesterday's announcements by the Finance minister of civil service reduction. A lot of people are very concerned about their jobs, and so on. We're looking to reduce the cost of government. The same taxpayer pays for the services we enjoy here in the Legislature as pays for all other ministries of government. I have some concerns about

We would like to see organizational charts from each of the legislative officers that show us who the managers are or, at least, what the structure is. We have heard several times today that the officers of the Legislature have already commissioned a consultant to explore shared services and saving administrative costs. We've seen some examples of relatively small organizations having their own finance officer and their own human resources officer, computer services personnel, clerical personnel. It seems to us the rest of government is looking at trying to collaborate so that we don't have duplication of the same services when an individual might be able to do it for a number of departments — at least in our case, for perhaps all of the officers of the Legislature — payroll for example, and various matters like that.

I wonder, too, about the whole concept of random auditing with regard to the work of the auditor general. I guess you might well say your audits are random to some extent. I've seen organizations that try to audit everything that's done and others who, on a genuinely random basis, audit some things and seem to get a pretty good prediction of the health of the overall organization. Maybe you'd like to comment on those things.

W. Strelioff: I've got four topics there. The change in government — the change in direction on how government is reshaping its service delivery. The organizational chart. There is an organizational chart in the annual report. It's the one that was in place at that time, but we can provide you with an updated one as well. The shared services and the extent of our coverage.

On the first one, the reshaping, the government in place sounds like it's changing how services are going to be delivered. From what I've listened to and heard, my understanding of the direction is that there's going to be more reliance on service delivery done by non-government organizations. That's a significant reshaping of devolving responsibilities to deliver services. Now, the key issue is going to be: how does government manage those arrangements? It's going to be very important. How do they know whether the services contracted for actually are being delivered?

My understanding is the government is also moving to less centralized controls and more expectations on accountability for results. The idea is to try to reduce the amount of central control and focus more on delivering programs. I mentioned that I understand that there's going to be a reorganization of the health system. That may change things significantly.

Those all relate to key risks that you as legislators now have in your responsibility of scrutinizing government. Are those initiatives managed well? My understanding is there's going to be less controls within government — which of course makes our job more risky, more difficult — and more expectations set out with non-government organizations. The changes taking place, in general, make our job and your job more difficult.

The third one, assessing shared services. Yes, we are working on an analysis of whether shared services make sense. One of the key parts of it, at least from my understanding of what's likely to unfold, is to make sure we can move away from some of the central systems we now have to participate in. Part of the revisions to the Auditor General Act we're advocating moves us away from the central systems of government. If we're going to reorganize our services in a more focused way and then perhaps share our services with other legislative officers, we're going to have to have the independence from government that we now do not have.

We're working on it. In the past we've provided advice and support to other officers. This is another opportunity to do the same. Also, we'll need that change to the Auditor General Act to make sure it actually can happen without the interference of the government of the day, which the current act does allow for.

The fourth one, the extent of our coverage. Our coverage is…. I guess I can't say that.

W. Strelioff: Yes. In my previous experience, I was at the same job in another jurisdiction for almost ten years. Coming here and seeing the extent to which this office is able to move into organizations and examine how they're managing, it's not adequate, to put it mildly. Therefore we do try to focus on the key risks. We try to focus our program. This year, health and education. That's where a lot of the money is. Information technology, capital projects — always a problem for any organization to manage well. Strengthening our capacity to examine how government manages environmental risks, a key part. We have to focus, and that's what we do. We can't really even put in a cyclical coverage of organizations. We just don't have the capacity to do so. The office in Alberta is — I don't know — 75 percent larger with a smaller province, fewer public-sector delivered services.

J. MacPhail: Thank you very much, Mr. Strelioff and your team. I actually want to explore this issue of funding new assurances, if I may, just to understand it. The Budget Transparency and Accountability Act requires that Ministry of Finance officials sign off on forecasts, as I recall — or certify the information. Do you recall that or not? Was that changed?

W. Strelioff: There's one change I think you're referring to, and that is I think the secretary to Treasury Board is to state whether the key assumptions are de-

That's new, though. That information is new. Then there's also a requirement to have…. There used to be a gathering of economic forecasters, but that's now officialized in the Budget Transparency and Accountability Act. So instead of just usurping those two functions, you're suggesting that you could look back in an auditor's way and determine the validity of the work. Or would you assist in looking forward?

W. Strelioff: This would be looking forward. There are, kind of, three steps on the annual financial plan or the budget, and then there's another on the quarterly updates. On the annual financial plan, what could happen is we would look to make sure that the accounting policies used to determine, to measure, to report the annual financial plan are consistent, rigorous, that they are the same ones used to prepare the annual financial results and that they're applied in a consistent way.

I mean, that's a key part of how the plan is put together. I'm not saying that isn't done now, but I am saying that when the financial results come out, they always vary from what was planned because things have changed. I think it would be valuable for legislators and B.C. citizens to know that those changes are a result of real economic events, not as a result of changing accounting or changing how the accounting is applied or other inconsistencies. That would be valuable.

J. MacPhail: At what point would that occur? At the assembling of the budgets?

W. Strelioff: That's why, in the proposal, I ask for your support to make this happen. I also recognize that it's going to take, I say, three years to actually make that happen. The other part is the interim financial results and forecasts. In the private sector when an organization issues its, say, third-quarter results, the auditors are along with it. They say: "Well, we've looked at it, and that's reliable." That doesn't happen in the public sector. It would build confidence in what's going on and make it more difficult to argue that the forecasts or the plans and the annual results are not reliable — that changes are due to real economic events, not something else. That's the essence of the proposal. It's an interesting one.

I. Chong: Before I move on to questions that I have in regard to your strategic directions, I just want to quickly refer to some items in your 2000-2001 annual report. I'm looking at your financial statements there. I see your recoveries were about $499,000 more than what you had…. Your actual was more than what your budget was. I also see your costs for professional service were up about $435,000. I'm presuming those two are related. If so, maybe if you can recall what it was specific to.

I. Chong: You had budgeted $1.2 million, and your actual recovery was $1.7 million. You had budgeted $477,000 for professional service; your actual was $912,000. So the $400,000…. The two seem to follow, and I was wondering if that was something in particular.

I'll just give you a few questions, so you can think about that. I do note that your organizational chart is on page 14, and I guess it's because it's got names listed as opposed to the numbers of FTEs. Perhaps we're wondering whether those are still in the same spots, which is why a new organizational chart would be helpful if you've moved people around to different functions to take into consideration a new task. I'd still be interested in that, what Kevin has asked for, as well. Also, in your financial statement you have annually…. For the last four or five years I've noted a $57,000 grant amount. I'm just wondering if you could give us a brief explanation as to what that's all about.

You also indicate in your comments that by devoting more time to work with government and the Legislative Assembly you may require more staff as a result. Maybe I did read it in the report. I think I saw it somewhere. This resulted in lost or unavailable audit hours, and I'm wondering if you have an idea of what amount of lost or unavailable audit hours resulted from that direction. Those are the first few questions I have before I have one or two on your strategic plan. Maybe you could just give me a background on some of that first.

W. Strelioff: The first one had to do with the recoveries. Our plan was $1.2 million and the actual was $1.6 million or $1.7 million. The recoveries are work we do when either examining or auditing financial statements of individual government organizations, which we actually charge for, as well as requests of government for us to do particular services they pay us for. In general, what our plan was and what actually happened during the year changed significantly. We quite often contract out for that kind of work.

I. Chong: I just wondered if that was what it was. You were requested to do more, but you didn't have the resources, so you contracted out. You made about $60,000 on that little transaction.

W. Strelioff: I don't know if we made money. The request usually ends up being a priority and then we

contract out other work. I can give you a more detailed explanation later of why it changed from $1.2 million to $1.6 million, just to let you know what the nature of the change is. You were right in the sense that it did end up meaning we hired more contractors. There's a very direct link to that.

The organizational chart. There isn't significant change to what this one looks like, but I can give you an updated one. We still have the six groups and still focus on sectors of government. That's where we're moving. A key person is Peter, the deputy auditor general.

The third one, a grant. A grant has to do with the Canadian Comprehensive Auditing Foundation. Our office, on behalf of the government of B.C., is a sustaining member of that group. One of the key initiatives going on right now is to establish general principles for performance reporting by public sector organizations. That's the organization pulling that together, and it's very important. I'm on their board and am part of the sustaining membership, and Peter and others in the office have worked with that organization. Mr. Fred Gingell was a strong participant in the forums of the CCAF. It's an organization that exists to further public sector accountability, governance, and management practices.

The fourth one, unavailable audit hours working with legislators. Is that in….?

W. Strelioff: It could have been that we said that during one particular year standing committees met more than we anticipated, and we spent more time attending those meetings and therefore less time carrying out audits, but I don't know if that was exactly….

I. Chong: That's what I got out of it. That was what confused me. I would have thought that your presence or that of the deputy auditor general wouldn't necessarily take away from audit hours, because those are generally devoted to the auditor's staff. It may take away from your management hours, but not audit hours.

W. Strelioff: We bring in the people who do the audits to explain the audits.

W. Strelioff: For example, when we think that next month there's going to be a Public Accounts Committee on a report on monitoring credit unions and trust companies, the people coming in will be the ones who actually carried out that audit, to explain it. But I don't know if that's…. Which page…?

I. Chong: I can't find it now, but it was there. It's not urgent that I have that information right now.

I. Chong: The other thing is in your financial report as well, appendix B. You've listed all the entities you audited. I would not expect these are necessarily recoverable. Some of them are done as a result of a function of your office, the list that you have in here.

I. Chong: There are a number of them which I wouldn't say are no longer existent, but very soon will be. Fisheries Renewal is one of them and Highway Constructors Ltd. — a number of them. My question to you on this area would be with a number of these no longer being required of you, and if they were not recovered amounts but were part of a function of your office that you did an annual audit for, wouldn't that, I guess, relinquish time for the auditors to do other jobs? I mean, you've got Skeena Cellulose….

W. Strelioff: Yes. We do charge the organizations you mention for their costs. That's one of the reasons our recoveries are moving down this year from $1.875 million, we're forecasting, to the end of the year. We anticipate it to go to $1.2 million next year — a significant, $600,000-and-some reduction. That relates to Fisheries, Forest Renewal and maybe B.C. Transportation Financing Authority. There are a few of them; I just can't quite remember them.

Okay. Just finally, then, on your strategic plan. In relation to the grant that you explained — the $57,000 paid to this organization that you're really a member of, I guess, and the grant allows you to be a member of — if that organization is doing much of the work about looking at auditing practices and standards and about assurances of budgets and things like that, then would the $500,000 request that you have — the $500,000 that you're looking for where you want $250,000, $100,000 and $150,000 over the next three years — not in fact be excess, in that you would be able to get the resources as a member of this committee? Would you not be doing their work and requesting we fund that kind of work, when in fact that committee is doing that work?

W. Strelioff: What the CCAF is doing is trying to get consensus across Canada almost like what the generally accepted accounting principles are, only for performance reports. We're participating in providing advice and help in reaching consensus amongst auditors, management and legislators that here are the principles that as auditors and management we should use to assess the reliability of the performance reports of public sector organizations. They're not carrying out those examinations; that's what we would do. They are a forum for agreeing on how performance should be reported and measured. It's the establishing and getting agreement on the general principles that leads to agreement on how performance should be reported by individual organizations. That then leads to the as-

sessment of reliability, the auditor coming in and saying: "Well, did you use those general principles to report on your performance? And if you didn't, why? Let's argue it out and try to move it forward."

I. Chong: You're saying you would require this extra $500,000 over three years to do incremental work from what you're currently doing.

I. Chong: No, I realize that, but incremental to what your office is currently doing in terms of auditing.

W. Strelioff: That's why we call it new assurances. We're asking if you want that from us. Without your support we can't do it. Legislators need to be able to say: "Okay. We expect the auditor to work on this, and we ask government to work with him."

I. Chong: My final statement to you, then, is: where would taxpayers see the value of that? What are we getting for this $500,000 other than an assurance? I do understand about the assurance principles, but taxpayers who are looking at what we're doing would say: "Why would you spend $500,000 more to have this function done? What would you do with that knowledge when you've done it?"

I mean, it's great to do a lot of things. It's great to have extra information, but, as we find out time and time again, what do we do with this, if we do anything? I would want to be able to say to a constituent: "This is how we have found cost savings or altered some sort of policy which resulted in savings in some other way." Or if it meant providing more credibility or reliability on statements which allowed us to get a better credit rating of some sort. We're looking at the outcome as well.

W. Strelioff: The outcome is public confidence in our institutions of government. There's been a lot of debate over the last few years that the annual financial plan of the government of the day has not been reliable. Just think of the decisions made based on that assertion.

W. Strelioff: To contribute to public confidence in the financial framework of the government would, I think, be immensely valuable.

I. Chong: Then we would measure the $500,000 spent over three years against the level of public confidence that has been raised. If in fact the bar of the level of public confidence hasn't been raised, then we haven't accomplished anything.

R. Sultan: I would like to pick up the theme that the member for Vancouver-Hastings was developing concerning funding new assurances again, as you've just been discussing. I'm intrigued by your notion this be done in real time concerning the annual financial plan, looking into the future. As a very small participant in the preparation of the current budget and three-year service plans that we're putting together at the moment and being somewhat aware of the process in which we're engaged, if I could encapsulate the process.

I guess it started sort of when we came in last September. It has involved this minuet between Treasury Board, Finance and the ministries, and at some point the GCCs are being brought into it. Our 15 minutes of fame will commence in about a week, and the whole thing has to be wrapped up, insofar as our contribution is concerned, on December 13. But that's not the end of it. Treasury Board will then be discussing these things further. I presume it all has to go before cabinet at some point. I presume the final budget will not be put to bed until sometime in January.

This is a very compressed and convoluted process. I'm just wondering, if we inject the auditor general as yet another way station in this journey, whether the whole thing is ever going to get completed? I'm being a bit facetious, of course. It would be another checkpoint, I suppose. I'm wondering how practical it is? Indeed the present process, I think, is straining the physical availability of members, as we can all attest. That's one point.

Secondly, aside from the process problems I would question whether we would gain comfort from having the auditor general's staff intimately involved in the process that I've just described. I would predict that inevitably you will become co-opted by the system. This is not an independent plan that some legislators and their officials have produced; it's a plan in which you've actively participated. I would guess, based on my experience, that you would have trouble later on putting on your completely objective outside hat to criticize it, because part of you is imbedded in what has been developed.

Then there's the third question, which is more tactical and maybe not a terribly important question in the long run. Even if this were to happen, should we be trying it right now when there are so many other changes underway, as you've so graphically described?

W. Strelioff: It is complex. The third question first. After three years we would be in a place to say okay, let's go.

The first question. The assurances we would be working to provide don't involve the policy decisions and the gathering of consensus and deciding what direction to go. It's focused on: have all the key assumptions been clearly stated? Are they stated in a way that is understandable? You can see where choices have been made, and you know that.

In preparing the revenue side — investment estimates, loan valuations, pensions, as well as expenses — have the accounting policies been used in a way consistent with generally accepted accounting principles? We wouldn't be getting into the policy frameworks and policy discussions. It doesn't provide huge amounts of assurances. We don't get into whether the policy choices are clear; it's more on whether the assumptions are stated. Are the relevant ones there? Are the accounting policies used in a consistent and rigorous manner?

It's not promising a great deal. It's focusing on some limited assurances. I think because of that, the closeness you get…. Can you maintain your independence, in reporting on the final results when you've been associated with the accounting policies put in place for the financial plan? There's an issue that would have to be guarded, but there is practice out there that doesn't make it impossible. Remember the interim results of other organizations in the private sector. They have their auditors providing some assurance on it along the way. Then they have to report on the end results. There are dilemmas in every profession, I guess.

R. Sultan: Could I ask a somewhat different question? I'm becoming aware — again, as part of this GCC process — of the performance measurements. It was a revelation to me to learn the other day that in fact this is now required by law. This is not an exercise; this is a legal requirement. What I hear frequently mentioned in various forms is the performance contracts or undertakings that are going to be demanded of school districts and health organizations and others, I presume, in the weeks and months ahead are the new means by which we are going to ensure performance. I would have thought, given the popularity of this new mechanism, that we're actually going to enter into agreements. We will, I presume, agree to have everybody reading by grade 8 or something, within some percentage, as one possible, trivial example. How are we going to, as you point out, have confidence in whether or not these contracts have been fulfilled?

You raise a very compelling point when you raise that question. I would think that because of the sheer number of contracts being entered into and the fuzziness of some of the measures I suspect are going to be embodied in some of those contracts…. In this regard I did benefit from a bit of a seminar from two of your officials yesterday who are experts in this area. This could occupy almost your entire staff, without worrying about all of your other responsibilities. This is a big, big area. I don't know what your comment on that would be.

W. Strelioff: You're right. I talked about the organization called the Canadian Comprehensive Auditing Foundation. One of the key steps to getting more routine in how you report on your performance is agreeing on general principles.

There's a window in the next year or two for actual agreement on general principles for public sector performance reporting. That is within grasp for the first time. There's going to be a body of knowledge established to guide the way.

The key part of the direction you've given government organizations is that you expect them to report on their performance. You expect them to do so publicly, and you want them to come into forums to discuss their performance. When they come into public forums and explain, it has to make sense. There will be weaknesses and problems, but it'll get better and better. Maybe ten or 15 years from now, there will be a lot of routine to it, but right now it's just touching. What you're doing is giving direction and support. You're asking organizations to say to the public: "How do you know whether we're successful?" Then you're asking them to come in and talk about it.

The audit role and the assurance role are going to be part of this, but not a major part. There will be pushing and prodding, but they're going to have to step forward in public and explain their performance and have people talk about it.

R. Sultan: It's all very well for you to have that confidence, but I can see ample room — to coin a phrase, wiggle room — in reporting performance. Being an older cynic, I'd be astonished, in fact, if many of these people are going to report anything but terrific performance, and they will have the numbers to back it up. Are we to believe them? That's where you come in.

W. Strelioff: One of the reasons I wanted to come today versus Monday is that last year, I think in September, the federal and provincial governments, including Quebec actually, agreed to publish health system performance indicators. They agreed on 14. There are lots sitting behind it, but every province in Canada actually agreed to publish that. Then they established a group of deputy ministers across Canada to work on how it's supposed to be measured.

On Monday the auditors are getting into this thing. We've been along for the ride a while, and now we're getting together to say: "Okay, this is unfolding, starting next September. How do we step forward to make sure that how they say they've measured things is the way they actually have been measured?"

It's going to be an interesting first, really important type of performance information. I'll look forward to describing to you how it plays out. Just what happened? What are the problems in moving it forward? What is the reliability of the information? Where is it not that reliable? How does it look for the future?

This was a response from the public saying: "We want to know how to assess the health system. What should we be looking at?" Then I guess the federal government is saying: "We're going to tie funding to reporting on performance." Then away it went. There is a window going.

P. Gregory: I think there's also an analogy. I know from your background that you have considerable experience in the financial area. In the beginning I'm sure

people had some concern about whether measuring financial results was a plausible thing to do. I think that's where we are now. After some lengthy period of time of trying to develop accountability principles for financial results, there's still wiggle room, as we know and we see. Nonetheless, people wouldn't consider throwing the financial reporting and audit out the window, because such important decisions are being made and public confidence is so important.

I think what we're coming to is that very important decisions are being made now in the public sector around health care, around education, around all these things, and people are saying that we've got to move to the plate on this. We have to develop a process that allows us to say that this is what we want to achieve. Did we actually get there? Can we measure it? Can we report it to the public? That's what people are engaged in. It's a big undertaking, as Wayne has indicated, but one I think, because of the financial experience and other experience, we're further ahead on and know some of the pitfalls you refer to. But I think ultimately there will be some benefit.

I might just also add for Ms. Chong that the CCAF grant that we pay, we pay on behalf of the entire B.C. government. Members throughout government can then participate in CCAF activities; people in Finance, etc., are included in the grant money that we pay. It just so happens it's paid through our office because they do do things that are of interest to us, and we, as an office, think we do get benefit from it. But others benefit as well.

L. Mayencourt: I have a question about your contingency in 2002 and 2003. I'm looking at your 2001-2002 forecast. You figure that you're going to have about a half million dollars left over at the end of the year that you're going to throw back at us. The reason that you have that is because you were quite prudent and realized you might not have the funding until August for your commissioner for environment and sustainability. In fact, when you did get it in August, it was with some shift in focus for how you're supposed to use that.

Personally I'm not inclined to punish you for being prudent and doing the right thing and waiting for some direction from the government as to what they wanted you to do with that $900,000. In my view what you're asking for is for us to give you that money back so you can use it in a contingency for something you think might be there.

I am not an accountant, and that's why I need you. We're going to have to make financial decisions, and I need to be able to look to someone with some external credibility. I feel like I want to help you do your job better so that I can do my job better. In the area of the new performance plans being put forward by the ministries, I similarly do not have expertise to find out whether performance measures are accurate and reliable and all that sort of stuff, so I'm going to need to rely on someone else to do that. Do you feel convinced you're able to do that? Did you do it in the last place you were? Do the people you have working for you have the skills to be able to do that?

As I noted before, I am not an accountant or an auditor, so I don't know if this is a great idea or a lamebrain idea, but I'll pass it out to you and you can tell me what you think of it. It seems to me I've heard that in some other jurisdictions there are accounting firms with employees they are going through a process of…. I'm not sure if the term is a practicum or something like that, but they come and work for them. They get them dirt cheap, and they want them to get expertise in all sorts of tax law and in government and all that.

Anyway, accounting firms bring in students, basically, and they train them. One of the things they're looking for is greater expertise for those students. Do accounting firms second people to the government? "Here, use this person for six months. We'll pay their salary. They'll learn a little bit that is going to be very valuable to us as a company." Does that happen? Is it a valid way of approaching it? That's the end of my questions.

W. Strelioff: Okay. I've got three. The third one first. We do have articling students in our office.

W. Strelioff: Bill Gilhooly, who is behind me today, did article with our office and obtained his chartered accountancy, so we have that within our office. We also, as an office, second people to other organizations within government. I think we have two out there right now. I mean, that's part of what we do.

When we second, though, the place that we second to, whether it's the Ministry of Education or the Ministry of Finance, pays their salary costs. We don't second them for free. The accounting firms, I think, also work with government organizations. I don't know if they lend them to other organizations.

Peter can speak to that. Go ahead, while I remember what another of the three is.

P. Gregory: Maybe I could, as Wayne says, add a little bit to that. We do have articling students in accounts. They are required to get specific types of experience in their training. We're able to offer part of that training. We have extremely good audit training for them, but we don't have tax and some of the others.

Our students go to firms for some of their experience. A lot of firms now don't do as much audit work as they once did, and they're looking for places for their students to get audit experience. They come to our office for audit experience. There's a lot of exchange. I'm not sure we have ever experienced free exchange — you know, from people coming in for nothing.

P. Gregory: We work to the advantage of our office and the taxpayers of British Columbia, I think, and also in the best interests of our students to try and get them the best training we can.

W. Strelioff: The second question you had was if we have the necessary skills within our office to actually carry out assessments of performance plans. In the context of Canada, we do have a lot of expertise on this issue we've been working on for quite a few years. We thought it would come earlier, but it's only coming now, so we have been participating in national forums and trying to make sure we have the necessary skills. We don't have the capacity to just go full bore and examine every service plan that moves, but we're building our expertise.

The first question related to the use of the $900,000 and that we plan to return pretty well half of that. As you mentioned, we wanted to make sure it was a real source of funding and waited until after August to actually begin to use it. How we use it is that we build capacity by people. We've spent some of the money by hiring people, building our people capacity. I'm trying to get to the point that the $450,000 we use represents half a year of capacity-building. If we had the full year, which is what we're planning for next year, we would use all that capacity.

L. Mayencourt: Oh, I see. And you're asking for that stable funding of $7.8 million.

P. Gregory: Yeah. What we did right at the beginning was say that we're not going to try to use that money. We don't want to get excess capacity this year and then have to let people go or something. We're only going to put in place capacity that's sustainable. We think that's the responsible thing to do, and we will turn it back. We knew pretty early on — well, right at the beginning of the game — that we'd be turning it back. We thought it was the right thing to do.

B. Kerr: In the private sector we engage firms to do both compliance work and special engagements. Then members of the audit committee, like myself, sit down and beat the auditors up in regard to fees. I'm not sure if I could ask the auditor general whether you guys are independent, whether you pick your own engagements or whether the Finance Committee or Treasury Board selects the engagements they want you to go on. How does that work in the auditor general's department?

W. Strelioff: In general, the Auditor General Act says: auditor general, it's your responsibility to decide the nature of your examinations.

B. Kerr: Yeah, but that's not restricting your scope. Clearly you guys determine the scope. I'm talking about specific ministries.

P. Gregory: Perhaps I could talk to that. We did cover this a little bit at the Public Accounts Committee meeting. Where we have been appointed auditor is a little bit of an accident of history. We took over some audits that were being done by the comptroller general's office when our office was formed. We have that as a basis, but we felt it wasn't the right mix. We have made an arrangement with the Minister of Finance where we can influence some of the audit appointments and have done that. We don't have access to all audit appointments. It depends on what the specific legislation says for a Crown corporation, for instance. We have to come to the Public Accounts Committee — or the Minister of Finance, I guess it is — to talk about the fees we charge for recoveries.

B. Kerr: You guys have to justify the number of audit hours you do — your recovery rates, I'll call them — and your charge-out rates.

P. Gregory: We discuss audit plans with audit committees and all of those things.

B. Kerr: Getting on to what you're asking for here, it is just a blanket amount of money without justification as to how much you think it will take. I guess that's put in as a contingency. Later on we get to sit down and say, "Okay, is it really going to be $500,000, or is it going to be $350,000, or is it going to be $750,000?" at that some time in the future. I mean, to get into specifics of what the actual engagement you're doing is.

W. Strelioff: Right now we're asking you for support for the funding. When we know what the funding is, we then also prepare a service plan that sets out in more detail the work we plan to do, which you also receive.

B. Kerr: That's what I'm getting at. You're asking for a contingency to be set up, but at some future date, we'll actually pin down what the actual amount is.

B. Kerr: Based upon the scope of your work. You'll have to outline to us what you anticipate the scope of your work to be.

B. Lekstrom (Chair): All right. Any further questions from members of the committee at this time?

R. Sultan: I will ask a tough question. Let me give my standard speech. We have a $3 billion structural deficit that we're grappling with — an unaudited number, but nevertheless one that I earnestly believe. We have asked all ministries outside of Health and Education to bring forward plans based on a 20 percent, 35 percent and 50 percent cut. It turns out the average — according to what I heard our Finance minister say to the press the other day — will be about 30 percent.

I guess my question to the auditor general is: backing off a little bit on the tempo of this cost-cutting, what would your activity look like if you took a 10 percent cut in the first year?

W. Strelioff: One of the purposes of this meeting is to seek your advice on our lines of business and our priorities to say: are we emphasizing the right priorities? If you decide less funding should come to our office, then I certainly would like advice on what services you think are less important, and then, when I shape our work program in the context of less funding, that's where I would reduce what we do for you.

R. Sultan: I guess you're saying: "It could be done, really. It just depends on what you people think is important for me to do."

I. Chong: Following up on that, I'm wondering if it's possible for your office, Mr. Strelioff, to give us a breakdown of the costs associated with each of the audit projects you've had. I'm not trying to do a make-work project, but if you say you've audited 30 entities or organizations, would you have an associated cost with that — i.e., this auditor, because of their charge-out rates…? I mean, it's not really charge-out, but their timesheets would track it. Would you have a rounded estimate of every entity that would maybe give us a better idea — the entities you audited and the costs associated with it — of why you need the $8 million in your budget? It would also help us identify those entities which may no longer require that and give us an idea of where funds can be redirected, if necessary, to fulfill other new projects you want to do.

We are looking to assist your office in doing the work it needs to do. At the same time, we need to take a hard look at those areas that may no longer need to be done, as well. If it's possible to do that, I'd just ask you, without spending a lot of time, to put something like that together and forward it to the Clerk of Committees so that we can have a copy. If it's not possible, then just send a reply back that it's not possible.

B. Lekstrom (Chair): I see no further questions at this time. Wayne and Peter, I just want to take the opportunity to thank you. I know the notice and our time frames, as I indicated earlier, have been very tight in order to get this put together. Certainly it is our intent to thoroughly review the information you've put forward to our committee in the written documentation. If we do have any questions, I'm sure that we'll be in contact with you. Once we have concluded our meetings with the seven officers, we are commissioned to draft a report, at which time we will deposit that report with the Clerk of Committees, and it will become public.

I would like to thank you, and certainly if you have any questions of ourselves, please don't hesitate to contact us. Likewise, we'll do the same, I'm sure.

We will take just one minute, and then we will reconvene to have a brief discussion as a committee on the format we will follow for the coming days and coming meetings. We're adjourned for two minutes.

B. Lekstrom (Chair): Okay, at this time we will reconvene the meeting of the Select Standing Committee on Finance and Government Services.

B. Kerr: Mr. Chair, I'd like to make a motion to go in camera for the remainder of the meeting.

B. Lekstrom (Chair): Do I have a seconder for that motion? Seconded by Ralph.

REPORT OF PROCEEDINGS (Hansard)

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES