2013 Legislative Session: First Session, 40th Parliament

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

MINUTES AND HANSARD


MINUTES

SELECT STANDING COMMITTEE ON FINANCE AND GOVERNMENT SERVICES

Thursday, December 5, 2013

10:00 a.m.

Douglas Fir Committee Room
Parliament Buildings, Victoria, B.C.

Present: Dan Ashton, MLA (Chair); Mike Farnworth, MLA (Deputy Chair); Mable Elmore, MLA; Eric Foster, MLA; Scott Hamilton, MLA; Gary Holman, MLA; Marvin Hunt, MLA; Lana Popham, MLA; Jackie Tegart, MLA

Unavoidably Absent: John Yap, MLA

1. The Chair called the Committee to order at 10:00 a.m.

2. Pursuant to its terms of reference, the Committee began its review of the three-year rolling service plans, annual reports and budget estimates of the statutory officers.

3. The following witnesses appeared before the Committee and answered questions:

Office of the Merit Commissioner

• Fiona Spencer, Commissioner

• Shelley Forrester, Executive Director of Corporate Services

4. The Committee recessed from 10:44 a.m. to 10:46 a.m.

5. The following witnesses appeared before the Committee and answered questions:

Elections BC

• Dr. Keith Archer, Chief Electoral Officer

• M. Nola Western, Deputy Chief Electoral Officer, Finance and Disclosure

• Anton Boegman, Deputy Chief Electoral Officer, Electoral Operations

6. The Committee recessed from 11:56 a.m. to 12:30 p.m.

7. The following witnesses appeared before the Committee and answered questions:

Office of the Conflict of Interest Commissioner

• Paul D.K. Fraser, Q.C., Commissioner

• Linda Pink, Executive Coordinator

8. Resolved, that the Committee meet in-camera to discuss a personnel matter. (Eric Foster, MLA)

9. The Committee met in-camera from 12:59 p.m. to 1:07 p.m.

10. The Committee continued in public session at 1:07 p.m.

11. The Committee continued its review of the three-year rolling service plan, annual report and budget estimates of the Office of the Conflict of Interest Commissioner

12. The Committee recessed from 1:10 p.m. to 1:14 p.m.

13. The following witnesses appeared before the Committee and answered questions:

Office of the Auditor General

• Russ Jones, A/Auditor General

• Malcolm Gaston, Deputy Auditor General

• Katrina Hall, Manager, Finance

• Marc LeFebvre, Executive Director, Human Resources and Administration

14. The Committee recessed from 1:51 p.m. to 1:53 p.m.

15. Resolved, that the Committee meet in-camera to deliberate on its draft report to the Legislative Assembly. (Eric Foster, MLA)

16. The Committee met in-camera from 1:53 p.m. to 2:20 p.m.

17. The Committee continued in public session at 2:20 p.m.

18. The Committee adjourned to the call of the Chair at 2:20 p.m.

Dan Ashton, MLA 
Chair

Kate Ryan-Lloyd
Deputy Clerk and
Clerk of Committees


The following electronic version is for informational purposes only.
The printed version remains the official version.

REPORT OF PROCEEDINGS
(Hansard)

SELECT STANDING COMMITTEE ON
FINANCE AND GOVERNMENT SERVICES

THURSDAY, DECEMBER 5, 2013

Issue No. 26

ISSN 1499-416X (Print)
ISSN 1499-4178 (Online)


CONTENTS

Office of the Merit Commissioner

605

F. Spencer

S. Forrester

Elections B.C.

613

K. Archer

N. Western

A. Boegman

D. Main

Office of the Conflict of Interest Commissioner

624

P. Fraser

Office of the Auditor General

628

R. Jones


Chair:

* Dan Ashton (Penticton BC Liberal)

Deputy Chair:

* Mike Farnworth (Port Coquitlam NDP)

Members:

* Mable Elmore (Vancouver-Kensington NDP)


* Eric Foster (Vernon-Monashee BC Liberal)


* Scott Hamilton (Delta North BC Liberal)


* Gary Holman (Saanich North and the Islands NDP)


* Marvin Hunt (Surrey-Panorama BC Liberal)


* Lana Popham (Saanich South NDP)


* Jackie Tegart (Fraser-Nicola BC Liberal)


John Yap (Richmond-Steveston BC Liberal)


* denotes member present

Clerk:

Kate Ryan-Lloyd

Committee Staff:

Josie Schofield (Manager, Committee Research Services)

Byron Plant (Committee Research Analyst)


Witnesses:

Dr. Keith Archer (Chief Electoral Officer)

Anton Boegman (Elections B.C.)

Shelley Forrester (Office of the Ombudsperson)

Paul Fraser (Conflict of Interest Commissioner)

Malcolm Gaston (Deputy Auditor General)

Katrina Hall (Office of the Auditor General)

Russ Jones (Acting Auditor General)

Marc LeFebvre (Office of the Auditor General)

Don Main (Elections B.C.)

Linda Pink (Office of the Conflict of Interest Commissioner)

Fiona Spencer (Merit Commissioner)

M. Nola Western (Elections B.C.)



[ Page 605 ]

THURSDAY, DECEMBER 5, 2013

The committee met at 10 a.m.

[D. Ashton in the chair.]

D. Ashton (Chair): Good morning, everyone. Thank you very much for coming. Welcome to the Standing Committee on Finance and Government Services. This is regarding the statutory officers of British Columbia.

I'd like to welcome, from the Office of the Merit Commissioner, Fiona Spencer and Shelley Forrester. Thank you very much for coming.

We have to take a short recess at coffee time. Kate is going to go out and make the first snow angel of the year out here on the lawn. We're all going to watch her. [Laughter.] Let it snow. Let it snow. Otherwise, there will just be a motion in the grass.

Nice to see everybody again. We've been away. Hope everybody has had a good bit of a breather from being away from the committee like this. We're back at it for the next few days.

Office of the Merit Commissioner. Thank you very much. We have you on between ten and 10:45. So 30 minutes for a presentation and up to 15 minutes for questions. The floor is yours.

Office of the Merit Commissioner

F. Spencer: Thank you for the opportunity to appear here today to speak to the accomplishments of the Office of the Merit Commissioner and to brief you on our plans for future work and discuss details of our budget request for the next three years.

I'm accompanied today by Shelley Forrester, who is the executive director of corporate services with the Ombudsperson's office, providing corporate services to my office and three other officers of the Legislature.

Shelley acts as our executive financial officer, so she'll be able to assist and respond to any questions you might have directly related to budget requirements.

My mandate, as defined in the Public Service Act, is to monitor the application of the merit principle by conducting random audits of appointments to and from within the B.C. public service to ensure that they are based on the principle of merit and that the individuals, when appointed, possess the required qualifications for the positions to which they were appointed.

I also provide a final-level review of the application of merit in competitions where employees who are unsuccessful in those competitions may request such a review. Additionally, I conduct special audits and studies in areas where there may be risks to merit-based hiring.

To fulfil my responsibilities, I am supported by a small staff of four, one of whom works part-time; four contracted auditors whom we engage on an as-and-when-required basis; an external audit advisory committee, which meets quarterly to provide my office with insights and advice; and, as you may know, I'm a part-time appointee.

This morning I'd like to highlight the results of our work, to speak to our workplans for the coming year and beyond, and to present you with an estimate of the budget that I consider necessary to meet my statutory obligations and to maintain meaningful oversight in the future.

First, I'd like to discuss our activities in the past year, including our findings related to merit-based hiring in the public service. In short, we conducted a merit performance audit of appointments made in 2012, conducted a special audit of temporary appointments originally intended to be less than seven months and carried out four final-level reviews of staffing decisions.

The bulk of our work related to what we referred to as the merit performance audit. This audit examined a random sample of appointments made in 2012 to ensure compliance with statutory requirements and policy or collective agreement provisions related to hiring.

As just mentioned, we also looked to see if the individual appointed had the required qualifications for the position as specified by the hiring manager. B.C. Stats assisted in the random identification of appointments for audit to ensure that an appropriate cross-section of appointments was included — that is, based on organization size, bargaining unit status and appointment type.

They also ensured that a sufficient sample size was maintained to enable us to confidently generalize the results of the audit to all appointments made within the 2012 calendar year. In this merit performance audit, we examined 228 appointments.

At the conclusion of the audit, the high-level results were shared with the B.C. Public Service Agency and deputy ministers and were summarized in my annual report, which was tabled this past August.

[1005]

The more detailed analysis and recommendations flowing from the audit were also provided to deputy ministers, as the hiring authorities, and to the agency, as the organization responsible for hiring policy in the public service. The agency's response to this audit was incorporated in my recently released results.

I am reassured that in all appointments audited, with one exception, we found no evidence that any individual appointed failed to meet the qualifications specified for the position to which they were appointed and found no evidence of patronage. In the exceptional case, the organization was unable to provide any evidence of the required criteria or the individual's qualifications at the time of appointment.

Reassuring as it is that all appointees were qualified, I think it is important to remain aware of the distinction between qualified appointee and the process which led
[ Page 606 ]
to the appointment. It is generally acknowledged that how an individual is appointed is just as important as who is appointed.

With respect to how individuals were appointed, I regret to say that not all appointment processes were found to be based on merit. In fact, in approximately 6 percent of appointments we found merit was not applied, and in another 36 percent we found issues that either had an impact on the merit of the hiring process or that were related to the availability of documented evidence to support hiring decisions.

While our year-to-year comparisons show improvements in some areas, there is a continuing downward trend in merit-based hiring that is of concern. I'd like to touch on a few points to emphasize the detailed findings, which are outlined in the full audit report.

With respect to those 6 percent of appointments where we found merit was not applied in the selection process, when the results were extrapolated to the general population of appointments of the same type — that is, permanent appointments over seven months and direct appointments — it means that in 2012 there is a high probability that an estimated 220 appointments made to and within the B.C. public service were not based on merit.

For comparison purposes, this does represent an improvement since 2011, when the percentage was 8.5 percent. But the rate is still significantly above the 2009 rate, when merit was not found to have been applied in only 2.3 percent of appointments.

When we came to the conclusion that an appointment was not the result of a merit-based process, it was due to one of three reasons which ultimately had a negative impact on the outcome: flaws in the overall process, flaws in how assessments were conducted or flaws in the calculation of years of continuous service.

We found evidence that appointments were made without open and transparent processes, that there was the potential for the hiring panel to be biased, that there were miscalculations of test scores and that some assessments were overlooked in favour of a subjective assessment of performance.

Reasons behind the findings of what we term "merit with exception," which occurred in 36 percent of the 2012 appointments, relate to issues identified with the application of hiring policy, collective agreement provisions or the satisfactory documentation of hiring decisions.

I'd like to acknowledge that a good number of appointments which fell into this category had identified documentation issues. While some may see the insistence on proper documentation as technical or perhaps overly bureaucratic, it is my view that managers must be accountable for ensuring sufficient evidence exists to support hiring decisions.

While we are often willing to accept credible verbal evidence, when significant documents are not on file or if we have difficulty drawing conclusions with respect to the application of merit due to a poorly documented file, we note these processes as exceptions to merit-based hiring.

Apart from documentation, we found issues in a number of other areas but most notably with respect to assessment. Assessment is based on the factors of merit as they are defined in legislation and refers to the various phases of the selection process used to determine if candidates meet minimal standards in how they rank, relative to other candidates.

The proportion of appointments with assessment flaws or issues nearly doubled since 2011. We found areas of concern with shortlisting practices, with testing and interviewing processes, and with the calculation of candidates' scores. While it could be determined that, for the most part, these problems did not affect the outcome of the competitive process, the potential for a negative outcome exists. Therefore, the importance of ensuring such errors do not continue to occur is significant.

[1010]

If we look at the results of the 2012 merit performance audit from the perspective of the percentage of appointments where there was a clear finding of merit — that is, where hiring decisions were clearly documented and there were no exceptions found to hiring policy or collective agreement provisions — there has been a decrease from 80 percent in 2007 to a low last year of 66 percent and now to the lowest level since audit activities commenced — 56 percent.

I find these results concerning, and they highlight for me the importance of this aspect of the work of the Office of the Merit Commissioner. Identifying areas of concern, bringing them to the attention of organization heads and the head of the B.C. Public Service Agency and making recommendations for improvement are essential if this downward trend in merit-based hiring is to be reversed.

As mentioned, these findings and issues have been raised and discussed with the B.C. Public Service Agency. I am encouraged by the agency's shared concern over these matters, and I'm pleased with their response to the audit report, which indicates a firm commitment to continuous improvement.

In 2009-10 we conducted an audit of short-term, temporary appointments originally intended to be under seven months. While a temporary appointment under seven months must be merit-based, there's no requirement under the Public Service Act for a competitive process.

The findings from our initial audit indicated that there were potentially large numbers of employees who had been temporarily promoted, without a competitive process, to assignments which had become longer term. Also, those employees were significantly advantaged when permanent appointments occurred. In fact, we found that in 80 percent of the cases the employees who benefited from these lengthy assignments also benefited from permanent promotion into the same or a similar position.
[ Page 607 ]
Based on those findings, a number of recommendations were made to address the identified concerns.

A recent audit was designed to see if there had been improvements in the use of this appointment type since our original audit and to further examine whether short-term, temporary appointments are being used for their intended purpose or if there is continued misuse to fill longer-term assignments.

What we found in the follow-up audit was that little improvement, if any, has been made. The majority of appointments initially intended to be under seven months became longer-term appointments, some extending from two to seven years. Some of these long-term appointments resulted from multiple extensions to the temporary appointment, which could have provided the opportunity to conduct a merit-based process and provided others with the opportunity for consideration.

Some may consider that, given the overall size of the public service, identifying issues with the relatively small number of appointments is insignificant. However, misuse of this appointment type does concern me for the following reasons.

In an environment of controlled staffing, the short-term, temporary appointment type is being used frequently. In fact, during the period under examination the short-term, temporary appointments represented approximately 20 percent of all permanent, temporary and direct appointments to and within the public service.

Also, the high rate at which temporary appointees are permanently promoted would suggest that, ideally, some form of merit-based selection process should be in place, including the right of review for unsuccessful employees.

Given the potential for use of this appointment type to result in a circumvention of the merit principle, recommendations were once again made to the B.C. Public Service Agency to clarify policy and improve monitoring. In addition, a recommendation was made to deputy ministers to compel managers to give full consideration to the likely duration of assignments before deciding to make appointments without competition.

Finally, with respect to staffing reviews, in 2012-13 we received a total of seven requests for a review of staffing decisions, only four of which were found eligible for consideration. In-depth examinations of the staffing processes in each case were carried out. In all four cases — and in one case which had been received late in the previous fiscal year — the appointments were found to be merit-based, and the reviews were dismissed.

This number of reviews is significantly lower than in each of the previous two fiscal years. While this decline might be attributed in part to the fewer number of appointments made in the public service in 2012-13, it might also be attributed to improvements in internal communications within ministries and greater involvement of the B.C. Public Service Agency in conducting inquiries at the deputy minister level.

We tracked the number of eligible requests that deputy ministers received for staffing inquiries. Further evidence of this improvement in practice is the fact that in 2011-12, 66 percent of the cases that were upheld at the deputy minister level were subsequently submitted to me for consideration, whereas this past year that percentage was approaching 33 percent. To date in this fiscal year we've already received seven requests for review. Openness and transparency in hiring decisions are key components of merit-based hiring, and we treat every review request with concern, diligence and urgency.

[1015]

Now just to speak to my priorities for the current and coming fiscal years. My priorities for the coming years are based on the strategic goals of increasing the relevance and impact of our audit activities. After bringing our 2012 merit performance audit to a close, we started a number of meetings with stakeholders to understand how the results of our audits were impacting hiring practices within their organizations, or in the case of employee representatives, how hiring practices were affecting their members.

The results of these discussions have contributed to some changes to timing of our audits and how we communicate audit results. For example, our merit performance audits will now be conducted over the course of a fiscal year rather than a calendar year in order to be consistent with other reporting periods, and to enhance the impact of the audit, this year's results will be distributed to heads of organizations only at the conclusion of the 2013-14 audit rather than on an interim basis.

We are also examining aspects of our audit program to ensure a distinction can be made between issues with those elements of merit-based hiring which may be considered technical in nature, such as ensuring files contain complete documentation, and issues with elements which may be considered more fundamental to merit-based hiring, such as eliminating qualified candidates from consideration in the early stages of the selection process.

We've commenced the audit of appointments made from September 2013 to April 2014 and have decided to conduct a partial-year rather than a full-year audit, due in part to workload pressures within the office but also to allow us to adjust to revisions in our program and to a new audit cycle.

We will be sampling appointments at a 95 percent confidence interval during this period, which B.C. Stats assures us will enable the results to be generalized to the broader population of appointments made throughout the public service during the same time frame. The results of this audit will be reported in the fall of 2014. We target to commence the 2014-15 merit performance audit in June of 2014.

Additionally, there are two issues related to merit-based hiring which will be the focus of study for the
[ Page 608 ]
Office of the Merit Commissioner. As a priority, we wish to bring to a conclusion the study of the assessment tool referred to as behavioural interviewing. This widely used technique, which at times is the only assessment tool used to distinguish between candidates, is a concern raised most often by employees as a potentially unfair practice.

Given that the B.C. public service relies heavily on this technique, a study is underway to examine the appropriate use of behavioural interviewing and hiring processes and any potential risk its improper use may pose to merit-based hiring. This study will also consider whether the elements necessary for proper use are supported in the B.C. public service and whether any potential risks are mitigated, where possible.

Another study we intend to undertake relates to the variety of standard tests and tools being put to increasing use in the B.C. public service to aid the assessment of applicants. These tools are used to increase efficiency and effectiveness in the hiring process. One such example would be a widely used self-assessment questionnaire used to determine if applicants meet the basic requirements of a position. Other examples would be aptitude and personal suitability tests.

Through our audits and reviews, we've identified a number of challenges associated with the use of these tools, including fairness, consistency and use for the intended purpose.

Finally, I think it's worth noting that the governmentwide work environment survey was undertaken again this year and that results are expected next month. This survey provides insight into employees' perceptions of their work environment, including — most importantly, from my perspective — their perceptions of fair hiring in the B.C. public service. Once these survey results are available, with the assistance of B.C. Stats, we will undertake an analysis of responses related to staffing to determine if there are other areas of study or audit that warrant our consideration.

In addition to the legislated requirement for the office to undertake random audits and conduct reviews, the work is driven by such factors as observations made during merit performance audits, changes introduced to staffing policy or hiring procedures, changes to the public service environment, and concerns brought forward by employees. Possible future work includes follow-up audits of lateral transfers and auxiliary appointment processes and the impact of narrowly restricted competitive processes on the fairness of competitions for appointments.

To accomplish this work, I put forward the budget request you have before you. You will note that in 2012-13 our expenditures were within less than 5 percent of the budget allocation of $1.024 million.

[1020]

In 2013-14 the office was granted a slight increase in operating funds to partially cover increasing salary and benefits costs, resulting in total budget allocation of $1.039 million. You'll note the salaries, benefits and professional services account for close to 70 percent of my expenditures.

I now propose another minor increase to our operating budget for 2014-15 of $10,000, or 1 percent, to cover costs associated with negotiated salary and benefits increases for staff and to address the slight increase in building occupancy costs. If approved, this would result in an overall budget of $1.049 million for the Office of the Merit Commissioner, still less than the 2011-12 budget allocation. I consider this to be a reasonable and fiscally responsible budget request, necessary to fulfil the mandate of the office and continue to uphold fair hiring in the B.C. public service.

Thanks. I would be pleased to respond to any questions you might have.

D. Ashton (Chair): Fiona, thank you very much. I was a bit remiss. If you don't mind, if I could just go around the table and introduce everybody, first of all. Gary, can I start with you?

G. Holman: Certainly. Gary Holman, MLA, Saanich North and the Islands.

L. Popham: Lana Popham. I represent Saanich South.

M. Elmore: Mable Elmore, MLA, Vancouver-Kensington.

M. Farnworth (Deputy Chair): Mike Farnworth, MLA, Port Coquitlam.

B. Plant: I'm Byron Plant, the research analyst to the committee.

K. Ryan-Lloyd (Deputy Clerk and Clerk of Committees): Good morning. I'm Kate Ryan-Lloyd, the Clerk to the committee.

J. Tegart: Jackie Tegart, MLA, Fraser-Nicola.

M. Hunt: Marvin Hunt, Surrey-Panorama.

S. Hamilton: Good morning. Scott Hamilton, MLA, Delta North.

E. Foster: Eric Foster, Vernon-Monashee.

D. Ashton (Chair): And good morning again. Dan Ashton, Penticton. I do apologize for that.

F. Spencer: I think I met everyone before the committee started, so that's fine. Thank you.

D. Ashton (Chair): Okay.
[ Page 609 ]

Questions? Comments?

L. Popham: My question is: is there a relationship between the Conflict of Interest Commissioner and your office, and is that a service that's used very often or reviewed if there's a perceived conflict?

F. Spencer: You mean a relationship in terms of the merit-based hiring, clearly?

L. Popham: Yeah.

F. Spencer: No, I'd say there's not. That's not something that they would necessarily be involved in, in the hiring within the B.C. public service.

L. Popham: My other question is regarding Appendix A, where it lists the organizations subject to the oversight.

F. Spencer: Sorry, Appendix A of which document?

L. Popham: The annual report. I don't see the Farm Industry Review Board listed on here. Is that something that you don't deal with?

F. Spencer: Gosh, I'm sorry. I'd have to look up that one in particular. It could be for two reasons. Well, the main reason would be that they may not have employees who were hired under the Public Service Act. That's basically what my jurisdiction encompasses. They may have employees, but they may be excluded or temporary — that sort of thing. But I will look that up. Farm Industry Review Board.

We did a fairly comprehensive review of our list of organizations last year, and I'm sure we would have touched on that one, but I'm sorry. I can't answer you directly.

M. Elmore: Thank you for your report. I'm quite concerned in terms of your findings with regards to, I guess, on the one hand, the decreasing trend in merit-based hiring and the increasing trend of merit-based appointments, particularly in short-term appointments. My understanding is that merit-based appointments have tripled since 2009 generally. Also, the practice of hiring short-term appointments, under seven months, and then those promotions going to longer-term positions is growing. I think this is a worrying trend, so can you speak towards concrete steps to address this?

F. Spencer: Well, when we conclude our merit performance audits…. First of all, when we audit each individual appointment, we provide deputy ministers and the head of the B.C. Public Service Agency with the report on that specific appointment, and then at the conclusion of the entire audit we provide them with an overall rollup of the results, and obviously, for the Public Service Agency, for the governmentwide results.

Deputy ministers and the head of the Public Service Agency have two opportunities to take some action. Of course, we're auditing appointments that have already occurred, so what it is, basically, is it can look at their practices within their organizations or policies that might be in place to see if they can make some changes to those.

I have been speaking with some deputy ministers in the last little while to see what happens with our audit reports when they get into an organization. I'd say that some of them use them for learning purposes. Clearly, they may speak to the manager who might have been responsible for that appointment decision, but often those people have moved on or are no longer within that particular area for hiring. But they do use them for training purposes, and so that does make a change.

[1025]

When we look at the results of the audit overall and we see that there are trends that are worrying or specific issues of concern, we'll make recommendations to the Public Service Agency and recommend that they take action on specific issues. As I said, I'm encouraged that the Public Service Agency shares our concern about some of these issues and is committed to taking concrete steps to address those and to improve within the public service.

They have taken, I'd say…. One area that you may have noticed — because I know you've been involved with this committee for a while — is that there have been significant improvements in the calculation of years of continuous service. There's a calculation that's required by the BCGEU collective agreement called the qualified relatively equal calculation.

When we first started these audits, there were significant problems identified with that, many of which led to merit not applying to findings. Through the involvement of the Public Service Agency and changes that they've made to their policies and procedures, that number has been reduced significantly. So they're working at the issues that we identify, and, hopefully, improvements will be made.

With respect to the temporary appointments under seven months, that's something that continues to concern us. I'm not sure that policies and procedures are in place to track those kinds of appointments and extensions to those appointments.

Under what they're calling their controlled staffing process right now, any appointments that are made require senior-level approval before they proceed. They are aware that when extensions are coming up to appointments requires there be some sort of a process in place. Whether or not that's what we could categorize as a merit-based appointment process, I'm not sure, because we don't get to look at those necessarily.

But, as I say, I am encouraged by the commitment that's been made to try to make improvements.
[ Page 610 ]

M. Elmore: Thank you for those answers. It just raises concerns in terms of politicizing the civil service and not hiring on merit and concern with regards to accountability and just ensuring that those measures are taken forward.

The specific recommendations to the Public Service Agency — is that included in your report that was tabled?

F. Spencer: Yes, it is.

M. Elmore: Okay. That's great. I'll have to look at those.

F. Spencer: And the merit performance audits. Yeah.

M. Hunt: Three questions. I'm new at this, so I'm just still swimming and trying to figure things out.

I know that in engineering, for example — let's take fire trucks as an example — I can make the specifications for my bidding process so that only one manufacturer can possibly meet the specifications. How is that within this process?

F. Spencer: Okay. Do you want me to answer that question first?

M. Hunt: Please. Yeah. I thought we could take them one at a time, and then we can make it easier.

F. Spencer: Well, that's good, because I always forget what the first question is if you ask three in a row.

The answer to that question. What we do is, if we're auditing an appointment, we look at the appointment process from start to finish. So we start looking at, first of all, to see what the requirements were that were posted for the position and whether or not they were reasonable.

Now, we don't replace managers' judgment with our judgment as to whether or not three years' experience was needed or five years' experience. But we do look to see whether or not they're asking for an engineering degree when it's — I'm not sure what — an accounting position. You know, those kinds of reasonable decisions.

Then when we look and see that, we also look to see whether or not, by posting those applications, they had a fair pool of candidates to select from. We have found in the past that they have specified the requirements to such a narrow degree that only one person could actually apply. In those cases we find that merit is not applied. We have had a request for a review of a hiring decision when somebody in fact said: "Look, I was screened out for these reasons, and it seems unfair."

That is something that we would look at, pick up on and observe on, for sure. One of the things where we have noticed — and it's one of the special studies I mentioned we would like to look at, perhaps, in the future — is competitions where they are unnecessarily restricted, either from a geographic perspective or from the perspective of having to have a certain number of years of experience.

[1030]

We have restrictions that are not only geographic; sometimes we have restrictions to employees who are within a specific part of a ministry. I can see where perhaps geography is an issue, because you may not want to move somebody across the province for a certain position. But to restrict something within a certain part of the ministry, we think, is overly restrictive — not open and fair — and needs to have a review. So we're looking at those things.

M. Hunt: Okay. Well, I think you might have almost answered my second question. That is…. For example, we just finished going through hiring a new city manager in the city of Surrey. Going through this process, we came down to four final candidates that we interviewed, and each one of them was uniquely different and would take us in different places. So we're dealing with the final decision being a decision of fit, vision — those sorts of things.

Now, is that what you're referring to as satisfactory evidence or documentation? So they're documenting why they made the choice that they made. Or are we somehow influencing how that final four should have been decided?

F. Spencer: Yes, to both those questions. I guess the first thing is that you would hope that before you start into a selection process, you define some of those things up front, not at the back end. You may find that there is an element of fit that you have to adjust to, depending on how the interviews play out.

In terms of what qualifications you need, what sort of experience — if you're wanting somebody who has a whole different skill set — you want to define that up front before you move into it so there isn't that element of bias or unfair selection.

Then when you get to the end of the process, from our perspective, you need to have…. Whatever decisions you've made, as long as they're reasonable and we can tell why you made those decisions, that's fair.

But if, for some reason, you're way out ahead in the selection process according to everybody's marks but, at the end of the day, someone else gets appointed, well, how did that happen? There needs to be some record on the file that, perhaps, they went and talked to your previous supervisor and found that you had attendance problems or those kinds of things. That sort of past work performance assessment needs to be documented.

We need some kind of evidence. Sometimes what we do is go to the managers and say, "Look, we don't know how you got from point A to point B," and they can explain to us very clearly. Perhaps they've just forgotten to put the documents on file.

But sometimes they haven't, because they're getting to the end of the process and they haven't been as diligent
[ Page 611 ]
in that. They can explain to us sometimes: "Well, this is what happened. We went and talked to So-and-so's supervisor that we knew, and So-and-so's supervisor was on the panel themselves, and they provided information."

So there's some credible evidence — verbal evidence — available. But sometimes we don't have that, and we don't have anything documented.

M. Hunt: Thank you. The third one is simply understanding…. I got the first word; I've lost the second word, so I didn't get it right on. But you spoke to it relatively negatively — that this is a practice…. You called it behavioural something or other.

F. Spencer: Behavioural interviewing, yes.

M. Hunt: Can you tell me what that is? Those words don't ring any bells for me.

F. Spencer: Sorry, yes. It's an interviewing technique that's used quite widely in the public service. What it is: basically, instead of asking people questions about their knowledge — "Can you tell us three ways that you drive a fire truck?" or whatever; I'm not sure what example to use — you would ask them to speak to behaviours that they have exhibited in the past that demonstrate certain competencies.

There are competencies that are defined for the public service, and those competencies include, let's say, teamwork. So we might say to you, "Tell us a time when you had a problem working as part of a team. What did you do about it? What might you have done differently, and how would you suggest changes be made in the future?" — those kinds of things. Then those answers are rated.

It's a tricky kind of an interviewing technique because it requires that there be some discussion within the panel of what level of competence we are going to require and how we are going to require people to demonstrate that level of competence. It's not always easy.

If you can give a really good example about a problem when you've had teamwork, you can probably speak quite eloquently to that. But perhaps I haven't had a problem with teamwork, and so my example is not, maybe, as good as yours. What it gets into…. Maybe you're very good at explaining those kinds of things and I'm not.

People complain about what they feel when they come out of those interviews — that it has more to do with how good people are at telling stories as opposed to how good they are at doing the job and their experience and their knowledge.

So it's not a bad technique. I don't mean to speak to that negatively. It's a good technique if used properly and if the people that are using it are trained well.

[1035]

Also, the element that's very important is to make sure that the people who have been assessed get good feedback as to what it is that the issue was.

D. Ashton (Chair): We started about five minutes late, so we have about 12 minutes left, and then we have somebody else coming in. Sorry, I just have to keep it to the time.

F. Spencer: That's fine.

G. Holman: Thanks very much for your presentation. Three questions. I'm also new at this.

In terms of the trend about the decline in merit-based hiring…. You report your results to deputy ministers and the heads of organizations that come under your purview. Is there a level above that? Is there a minister responsible? Does it just go, ultimately, to the Legislature? Or is there a level above the heads of the individual organizations that are supposed to be acting on this matter?

F. Spencer: The deputy ministers are the hiring authorities, and they delegate that hiring authority within their organizations.

The other place that I report, in terms of the results, is the B.C. Public Service Agency, and they're the organization responsible for hiring policy and the broader hiring decisions within the B.C. public service. I report them to Lynda Tarras, who is the head of that organization. She's the one that responds for the public service, in terms of "here are the actions that we're going to undertake." Then, of course, I report here.

G. Holman: In your view, is that working, given the trends that you've just described?

F. Spencer: Well, as I say, we've seen improvements in some areas. It's a slow improvement in certain areas, and I think what we're doing now is focusing in on other areas where they can make some changes. It's a moving target, I would have to say.

G. Holman: Just quickly, does your office review the hiring of constituency assistants for MLA offices?

F. Spencer: No. We only look at employees under the Public Service Act.

G. Holman: Does it apply to the appointment of deputy ministers?

F. Spencer: No. They're appointed under order-in-council, and that's not what I….

G. Holman: Just a quick question about budget. For last year, you slightly underspent the budget. Could you describe the reason for that? I mean, it's a minor underspending, but I just was wondering the reason for that.
[ Page 612 ]
You've asked for a slight increase this year.

F. Spencer: Well, the underspend was pretty close, I think. They wouldn't want me to spend much closer than 5 percent to budget, I think, but we had targeted to spend the amount. It would probably be, I would say, a slippage in salaries. We had someone who was on leave who returned to the workforce on a part-time basis rather than a full-time basis.

M. Farnworth (Deputy Chair): Marvin asked my question on behavioural. So the only question I have is: when you make your recommendations to the Public Service Commission, do they respond in writing to your recommendations?

F. Spencer: Yes, they do.

S. Hamilton: I guess if you were to review on merit the hiring of constituency assistants…. I don't know if you could actually frame up a job description, because they have to be accountants, social workers, sometimes office cleaners. They've got to be able to put a little different….

F. Spencer: Public relations people.

S. Hamilton: Anyhow, I just have one question, and that is with regard to the uplift in the numbers of the length of the temporary assignments. Maybe what I'm about to say is somewhat rhetorical, but could part of this have to do with our economic times? We have hiring freezes throughout the public service. So could we be looking at a blip here that's directly attributable to the fact that it's very difficult to hire right into these new positions?

F. Spencer: Yes.

S. Hamilton: The temptation is, of course, to find someone within the organization to act in a position, and because you can't hire permanently, that also has a domino effect throughout the organization. You can't hire permanently, and of course you need these positions filled, and you need this type of work to be done. So you're continually extending the TA. I've seen this from a personal perspective. It runs rampant through an organization, particularly in times like this when you have hiring freezes.

F. Spencer: That's right.

S. Hamilton: Maybe you could speak to that a little bit.

F. Spencer: It's totally understandable that those things occur. Just because it's a temporary appointment, it doesn't mean that you're prevented from having a merit-based process to make the selection for that appointment. I guess that's where we have some concern.

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If you know at the outset that this is likely to extend beyond seven months, why not have a process where at least the people within your office can put their hands up and say: "I'd like to be considered"? If, after the first seven months, you know it's going to go for another seven months, at that point you have that opportunity. I guess that was my point.

We saw some of these appointments that go for seven years where there have been, I don't know, 15 opportunities to allow other people to be considered and appointed, and that's where I have the concern.

J. Tegart: Thank you for the information that you've shared. As a new person, I didn't even know we had an Office of the Merit Commissioner, so it's been quite a learning curve.

Just a question: is your office under core review?

F. Spencer: No.

J. Tegart: Okay. Also, there are dollars in the budget for salary increases. For many of the public sector employers, the direction has been to find salary increases within budgets that are already there. Is that a direction to your office also?

F. Spencer: I don't believe we've received that direction, I would say. I'd have to ask Shelley, but I haven't. I'm not aware….

S. Forrester: I think what's been called a salary freeze — it's known as that — does have some bearing on the offices, and I would suppose that for any changes the officers might want to make, they would want to talk to the head of the BCPSA about that.

In terms of the hiring freeze, though, I don't believe that applies to the independent offices. However, the independent officers that I work for and report to certainly — like a deputy minister — are making all the hiring decisions. So in some ways it's comparable in terms of the impact on those offices.

J. Tegart: Okay. Just for clarity, I'm thinking of some of the presentations that we heard during our consultation in regards to the difficulty of finding salary increases that were negotiated, and the direction has been to find within the dollars that you receive. So that was the question.

F. Spencer: We're prepared for that potential decision.

E. Foster: Two quick things. The comment you made about people telling stories. I can't remember what your term for it was. As somebody who's done hundreds of
[ Page 613 ]
interviews, both in the private and public sector, the person who has the best interview skills quite often gets the job, based on everybody having the same degree and relatively the same amount of experience. So that's a tough one. If you've got those skills, you get hired.

The other one was you made a comment about a supervisor asking another supervisor about an employee. I can tell you what that costs. I got a phone call from a fellow that was interviewing an individual. The individual had said that he had left his former employment, which was me, because there was a difference in opinion of how the operation should run. I said: "Yeah, it was. My opinion was he should show up for work on time; his opinion was he shouldn't." That cost me two months' salary, just for making that comment.

You don't get to ask anybody. We have the Privacy Commissioner coming in here, and it's huge. So all those things have to be…. When you're doing your report…. When you're doing interviews, you're really hamstrung under, basically, what's come out of the court system.

I don't know what went on in all these interviews, but I've done a lot of them. Ten years ago you could get good information when you did interviews. You can't get it now. So it's not nearly as easy to do it on merit as it was before.

D. Ashton (Chair): Fiona and Shelley, thank you very much — greatly appreciated. Very interesting comments this morning.

I just asked Kate the process, and the notification will be given out as the report will be coming out. Have a good morning. Thanks for coming.

F. Spencer: Super. Thanks for your attention and your questions.

D. Ashton (Chair): We'll just take a very short break as Elections B.C. comes forward.

The committee recessed from 10:44 a.m. to 10:46 a.m.

[D. Ashton in the chair.]

D. Ashton (Chair): Good morning, sir. Dr. Archer, thank you very much for coming. It's Nola Western. And is it Anton Boegman? Thank you for coming.

I'll just do a quick introduction around the table.

G. Holman: Good morning. Gary Holman, MLA, Saanich North and the Islands.

L. Popham: I'm Lana Popham. I represent Saanich South.

M. Elmore: Good morning. Mable Elmore, MLA, Vancouver-Kensington.

M. Farnworth (Deputy Chair): Mike Farnworth, MLA, PoCo — Port Coquitlam.

B. Plant: Good morning. I'm Byron Plant, the research analyst to the committee.

K. Ryan-Lloyd (Clerk of Committees): Good morning. I'm Kate Ryan-Lloyd, the Clerk to the committee.

J. Tegart: Good morning. It's nice to see you again. I'm Jackie Tegart, Fraser-Nicola MLA.

M. Hunt: Marvin Hunt, Surrey-Panorama.

S. Hamilton: Hi. Scott Hamilton, Delta North.

D. Ashton (Chair): Good morning once again. Dan Ashton, Penticton. Eric Foster is AWOL right now, but he'll be back in a minute.

We have 30 minutes for the presentation, 15 minutes allotted for questions. Sir, the floor is yours.

K. Archer: Thanks, Mr. Chair. Now, my understanding was that we had 45 minutes for the presentation and then 30 minutes for questions.

D. Ashton (Chair): That's it. That's my mistake. I apologize. I was reading off of the last one.

Elections B.C.

K. Archer: Great. Thank you.

Well, good morning, Mr. Chair, Mr. Deputy Chair and to the other members of the committee. It gives me great pleasure to appear before you this morning and to share with you some of the activities of Elections B.C. during the current year and into the coming year and to review our budget requests with you.

I'm joined today at the table by Nola Western — she's been introduced; Nola is the Deputy Chief Electoral Officer for funding and disclosure — and by Anton Boegman. Anton's a deputy Chief Electoral Officer for electoral operations. Also joining us today, behind me, are Sherry Hyde — Sherry is our comptroller — and Don Main. Don's our communications manager.

In support of the presentation, I believe you all received our written budget submission. We'll be referring to this document as our presentation unfolds.

This is the third year in which I have appeared before this committee to provide our budget presentation. As I've done previously, I'd like to get right to the heart of the budget submission. While our subsequent comments will help explain why we came up with the budget submission before you, let's get straight to the numbers.

Our budget submission this year differs from the last two years in that it includes funds for ongoing operations
[ Page 614 ]
in a separate capital budget request but includes no separate event requirements at this time. It also includes a request for access to contingency funds for the current fiscal year. I'll elaborate on that in a moment. If on-demand events arise that require additional funding, we'll bring our additional event funding requirements before this committee.

As you'll see as we discuss the budget figures in greater detail, our submission this year is characterized as a hold-the-line budget. For our operating budget we're seeking the same figure — $8.21 million — that was approved last year as our 2014-15 operating budget projection. This is the same amount allocated for our operating budget for the current fiscal year.

[1050]

Although our schedule A employees have salary increases as per the public sector negotiated settlement, these increases will be accommodated from our current operating budget allocation. For our capital budget, we're seeking funds only for key information technology development in the amount recommended by this committee last year. That amount is $700,000.

That's the big picture: a hold-the-line budget for our statutory, defined responsibilities. But to this picture I must add a caveat.

There appears to be a good likelihood that the statutory responsibilities of Elections B.C. will soon be extended. In 2010 the Local Government Elections Task Force recommended that Elections B.C. be given a mandate to oversee election financing for local government elections. A government white paper on local government elections reform published in the fall of 2013 proposes to act on that recommendation, with some changes taking effect for the November 2014 local government elections. It's my understanding that legislation to this effect may be introduced in the spring session of the Legislative Assembly.

To ensure that Elections B.C. is able to act upon this proposed new mandate, our budget submission also includes a request for access to contingency funds for the 2013-14 fiscal year in the amount of $79,000 in operating funds and $70,000 in capital funds. Should legislation be introduced to provide the expansion in Elections B.C.'s mandate in this regard, I will communicate with this committee at that time with regard to our ongoing funding requirements.

Our presentation this morning will proceed as follows. First, I'll discuss our planning framework and the changes that this framework produced for the manner in which Elections B.C. approached the 2013 general election. I'm often asked what activities Elections B.C. engages in, in the period between general elections, and I'll share with you some of the projects in which we're currently engaged or will be engaged during the upcoming fiscal year.

Nola will then follow with a more detailed presentation on our operating and capital budget requests, and then Anton will provide more detailed commentary on the recent and ongoing event activities. In my concluding comments I'll return to emphasize several key features of our budget requirements.

Let me start with our strategic planning framework. Elections B.C. initiated a strategic planning process in 2009 that resulted in a draft strategic plan in 2010. My appointment in September 2011 enabled the completion of the strategic plan, which is now guiding the strategic priorities of Elections B.C. I won't review all the elements of our strategic plan with you in detail. We summarized some of those in our budget presentation on page 2.

I can tell you that our strategic plan is very much a living document. We didn't go through the effort of developing a strategic plan so that it could gather dust in a bookshelf. Instead, we completed it so that we would have a clear vision about the values that underlie our work, so that we could establish a number of priorities and so that we could focus our efforts on achieving those priorities. In a practical sense this means that both our operating budget and our capital budget requests have been developed with reference to our strategic plan and that all expenditures have been assessed through the lens of that plan.

The first and most important of our strategic priorities is the commitment to approach all design and implementation decisions with the experience of voters and other stakeholders in mind. It's what we call a voter-centric model of election administration.

[1055]

The question that we pose is this.If we were to design a particular process, a form or a procedure, from the perspective of a voter, what would it look like? By using this vantage point, we found that there are differences in the way we worked in at least three areas in administering the general election this past May. These are: in the accessibility of the ballot, in the efficiency of the voting process and in the quality of the voters list.

I'd like to talk about each of these in a little bit of detail. First, on the accessibility of the ballot. The starting point is that British Columbia has the most accessible ballot in Canada. Voters can vote all 28 days of the writ period. They can vote in their assigned voting place, or they can vote outside of it. They can even vote outside their electoral district — and that's an unusual feature of election administration. They can vote by mail if travel necessitates it. And if they can't get to the voting place, we can arrange for a team of mobile voting officials to go to them.

Now, although the ballot in British Columbia provincial elections is very accessible, we also found that there's a gap in understanding that level of accessibility amongst many voters, so we attempted to close this gap. In developing our public information messaging about the election, we highlighted the fact that voters have many voting opportunities. We ran TV, radio and transit ads
[ Page 615 ]
which played up the theme of a voter choosing when and where to vote.

But we did more than talk about accessibility in our communications. We also developed tools that aligned with the message that you can vote at any voting location in British Columbia.

We have an information tool called Know Your Electoral District. That tool can connect the voter's address with their electoral district, and it provides a lot of very useful information to them.

Firstly, we changed this tool, which was developed for a laptop computer, to make it easier to use with a mobile device. Then we extended this tool with what we called the voteB.C. app. Again, you may have seen some of our ads on this during the campaign period. The app enabled voters to find the closest voting location to them at any given time. We then featured this voteB.C. app on many of our ads during the campaign period.

The third thing we did regarding accessibility was to focus on removing administrative barriers to voting. One possible barrier to some eligible voters is the requirement to provide identification when attending a voting place. Now, we recognize that for the vast majority of eligible voters, that's no barrier at all since they have the documents on their person that can satisfy the identity requirements.

But that's not the case with all eligible voters. Following a request from the Union Gospel Mission, we agreed to accept a prescription medication container with a voter's name as one of two identification documents that enabled them to vote. Accessibility is provided when administrative barriers are removed.

Lastly, with respect to accessibility, we wanted to highlight some unique voting opportunities that emphasize and highlight this accessibility of the ballot in B.C. We established, for example, a voting place at the Kelowna Airport. We even had — and this is, I think, novel in Canadian election administration — drive-in voting at one of our district electoral offices in Courtenay.

Did these efforts make a difference? We've not yet completed our full analysis of the impact of the various activities on the general election. These will be included in a number of reports that I'll be submitting to the Legislative Assembly in the coming months.

What I can tell you, however, is that voter turnout in British Columbia, which has been declining for a generation, increased in 2013. About 165,000 more people voted in 2013 than voted in 2009. In addition, the percentage of registered voters who voted increased from 55 percent in 2009 to 57 percent in 2013.

[1100]

As Anton will describe in more detail later, a striking trend is that all of this increase of 165,000 voters occurred outside of general voting on May 14. So it related to the accessibility of the ballot in British Columbia.

Second, I'll talk about the efficiency of the vote. I said earlier that focusing on making the voting process more efficient for voters was a secondary in which the voter-centric model had an impact in 2013. It's a topic that we refer to as voter modernization. It involves finding ways to ensure that a voter's experience in the voting place is not bureaucratic or unnecessarily repetitive. It also involves a focus on ensuring that our procedures do not administratively disenfranchise eligible voters.

Now, in my previous set of recommendations for legislative change, submitted to the Legislative Assembly in 2011, I included a recommendation to decrease the number of voting officials that were required to attend each voting place so that the voting process itself could become streamlined. To date, that recommendation has not been acted upon. I expect I'll have more to say about the ways in which the voting process can be modernized in my forthcoming report on recommendations for legislative change.

Some of the changes that can be introduced to simplify the voting process don't require legislative change. Some changes can reduce duplication of effort on the part of the voter and the election official, reduce errors in recording information correctly and even speed up the voting experience, while working within the current legislative framework. For 2013 we introduced a number of such changes. Again, Anton will be discussing these in a bit more detail in a few minutes.

Thirdly, I'd like to talk about the voters list quality. The third way in which the voter-centric model impacted the 2013 general election involved improving the quality of the voters list. Being left off the voters list or being listed at the incorrect address is an administrative barrier to voting. We communicate directly several times during the event to all registered voters. And we provide the voters list to political parties and candidates, who also use this information, as you well know, to contact voters.Therefore, it's in the interests of eligible voters, of parties and candidates and of Elections B.C. to have a high-quality voters list.

We developed a new, strategic approach for updating the voters list in advance of this general election. Again, Anton will be discussing the details with you shortly. What I can tell you is that we adopted a more proactive approach to registering new voters and for updating information for voters who had moved. I'll be submitting a separate report in several months outlining our enumeration campaign in 2013.

The data to this point indicate that we've achieved a level of currency and coverage in the voters list that's higher than was the case in 2009 and is amongst the highest in Canada. As I reflect back on the administration of the 2013 general election — an election in which we adopted a voter-centric approach — my perception is that this approach made a positive difference in the level of voter engagement.

Now, I'd like to talk a little bit about the ongoing work
[ Page 616 ]
at Elections B.C. Elections B.C. has a full-time, permanent staff complement of 44 employees. Our permanent staff are fully engaged throughout the electoral cycle to support the many aspects of the electoral process for which we have responsibility and to ensure the organization is constantly ready to deliver on-demand events. It's impossible to understand our business or our organization separate from event activity.

At it's peak, on general election day, Elections B.C. staffing reaches up to 33,000 employees. Think about that for a minute. For a general election event to be successful, we need not only to recruit 33,000 people; we need to develop appropriate training materials for this small army of employees who become, for the typical voter, the face of our organization. We want to ensure that the 85 district electoral officers that run the election throughout the province are provided with a common desktop to interact with our office.

[1105]

We need to ensure that our information technology infrastructure is easy to use and fail-safe, because failure in our business is not an option. We require electoral geographic systems that generate usable maps for political parties and candidates, and financial reporting systems that ensure parties and candidates can fulfil reporting requirements and that we can ensure compliance.

Our efforts are directed towards building trust and integrity in the electoral process, and we direct ourselves to these efforts every day of the electoral cycle.

In the period between elections we have statutory responsibility to administer initiative petitions, recall petitions and by-elections, and we conduct thorough reviews of financial reports submitted by candidates, political parties and third-party advertisers.

In addition, however, we review and revise our processes, forms, equipment and materials to ensure our readiness for the next general election. We're presently engaged in such a review and revision.

Successful electoral events don't occur by accident. They follow from careful planning, reviewing, documenting, recruiting, hiring, training, deploying systems and resources, receiving financial reports and following up to ensure compliance with requirements.

The electoral business is also a changing business with changing public expectations of the way in which citizens may exercise their franchise and otherwise participate in the electoral process. Consequently, we also need to be a learning organization.

Elections B.C. is also either currently engaged or soon will be engaged in a number of significant projects that have a bearing on our work plan. I'd like to briefly discuss three of these with you. There are a number of others that I'm happy to talk about in question time, if you like.

The first has to do with the independent panel on Internet voting. This panel was convened in September 2012. I was asked to and agreed to chair this panel. It's a five-member panel that has been looking at prospects for Internet voting for local government and provincial government elections in British Columbia.

The panel issued a preliminary report six weeks ago — issued it publicly — and commenced a period of public consultation on this interim report. That period of public consultation ended yesterday.

Over the coming weeks the panel will reconvene to consider the public input that we have received and will be preparing a report to the Legislative Assembly. I expect this report will be submitted to the Legislative Assembly early in the new year, likely sometime in February.

The extent of future activity, the extent of our involvement with electronic voting in British Columbia, will be determined in large part by the way in which the Legislative Assembly receives and responds to this report. Again, I'd be happy to answer questions that people may have about the recommendations of the panel.

Secondly, I'd like to talk a bit about local government elections. As I noted earlier, a white paper has been issued by the government with respect to local government elections. It contains proposed legislation that may be introduced into the Legislative Assembly. That legislation reflects a significant expansion in Elections B.C.'s role for overseeing financial reporting in local government elections.

To understand the scope of this change for our organization, consider that typically about 3,300 candidates contest positions in local government elections. If legislation like that proposed in the white paper is introduced, all of these candidates will be required to understand the new rules of financial reporting, will be required to submit their reports to us, and those reports will need to be reviewed to ensure compliance. So this could represent a very substantial expansion in our responsibilities and our mandate.

[1110]

The third project I'd like to talk to you about is the Electoral Boundaries Commission. The Electoral Boundaries Commission Act requires that the province convene an electoral boundaries commission following every second general election. The last commission was convened following the 2005 general election. Therefore, a commission must be convened following this most recent election. It's got to be convened within a year of that election date, so it must be convened by May 14, 2014.

The Chief Electoral Officer serves as one of three members on the Electoral Boundaries Commission. The commission has 12 months from the time it is struck to submit a report to the Legislative Assembly. That report is probably best thought of as a preliminary report or an interim report.

Following the issuance of this report, there's an obligation for the commission to hold public hearings, and a final report must be submitted within six months of the publication of the initial report to the assembly. The
[ Page 617 ]
commission may also hold public hearings in advance of the publication of the preliminary report. Traditionally, in British Columbia we would expect that would take place.

Now, changing electoral boundaries has a very significant impact on the work of Elections B.C. We produce thousands of electoral maps, and each of these maps is likely to change as a result of changing electoral boundaries. The data underlying our reporting systems also are affected by changes to the electoral boundaries. Therefore, the creation of a boundaries commission affects the work not only of the Chief Electoral Officer but most other elements of Elections B.C.

I'll be putting forward a recommendation to the chair of the committee, once the Chair is appointed, that Elections B.C. provide the administrative support to the commission — something that we typically haven't done in B.C. to this point — to achieve some significant efficiencies in the operations of the commission and to ensure that the transition from proposed map changes to a fully functioning election management system is as seamless as possible.

Although there are a number of additional projects on which we're currently engaged, I'm not going to address those for the time being. I'd be happy to talk to you about them in the question-and-answer session.

I'll pause in my presentation now and turn it over, first to Nola and then to Anton, for further comment on our spending plans in the year ahead.

N. Western: It's a pleasure to appear before this committee again. Anton and I were here in September, so it feels like it hasn't really been as long as it usually is between appearances.

You heard Keith say that most years Elections B.C. has several budgets: an ongoing operating budget, a capital budget and event budgets.

The ongoing operating budget covers our core services. Those are the costs that we incur every year regardless of whether there's an election or other event — things like permanent staff salaries, office rent, amortization, information technology costs.

The capital budget is the budget for purchasing, developing or improving capital assets such as our computer systems, and we have some major computer systems.

Event budgets cover expenses specifically incurred in relation to the electoral events that we administer under our legislation — for instance, general elections, by-elections, initiative petitions, enumerations.

As Keith has noted, there are no scheduled electoral events for the next fiscal year, so there is no event budget request included in this document. However, we still have to maintain a constant state of readiness. We need to be ready at any time to deliver any on-demand event.

The requests for the ongoing core services and the capital budgets are shown separately in this document. The format of this proposal is the same as that which has been used in the last few years.

If you turn now to page 10, you'll find our core services operating budget request for next fiscal year, 2014-15, and the following two years. EBC's current operating budget for '13-14 is also shown, and you can see that we're not requesting any increase. In its report last December this committee recommended that the '14-15 budget for Elections B.C.'s ongoing services be set at $8.21 million. We're confident that we can manage within that funding level.

[1115]

Expenses that support all the business areas — such as salaries, IT, office expenses and rent — are shown separately from the core business lines. The core business lines are also shown on that table, and there are notes on the following pages that provide details about those expenses.

Although the overall budget remains the same, there are always fluctuations between separate line items as we adjust to changing circumstances and projects each year. There is an increase to salaries and benefits next year resulting largely from the negotiated wage increase for schedule A employees, who are entitled to the same wage increases as the BCGEU members.

Amortization or depreciation is the allocation of the cost of a capital asset to operating expenditures over its useful life. Although the actual cost of capital assets must be paid initially out of our capital budget, the cost must also be paid out of the future operating budgets over a number of years. The level of amortization fluctuates with the level of investment in capital assets and the age of the assets that are currently held.

The cost of corporate information systems will decrease next year, largely because our personal computers, their operating systems and the MS Office software that runs them have been recently replaced. Those are costs we won't occur in '14-15.

Address and boundary maintenance costs will also decrease next year because we now do our own service support for the geography system servers.

Voters list maintenance represents costs incurred to maintain the provincial voters list. Next November there will be local elections in over 160 municipalities in British Columbia. Many of those municipalities use our voters list and our voter registration documents. When those elections are over, Elections B.C. will receive tens of thousands of new and updated voter registration forms that will be processed and added to the provincial voters list.

The increase in the voters list maintenance budget for '14-15 represents the price of processing those updates and the cost of making sure that the voters list that we provide to the municipalities is as current as possible when we cut that list later in the fall.

Political entity reporting includes costs associated with registering political parties, constituency associations and election advertising sponsors; reviewing their financial reports; and conducting investigations as required
[ Page 618 ]
by section 276 of the Election Act. There are currently 22 registered political parties in B.C., 147 registered constituency associations and 232 election advertising sponsors.

Political entity costs will increase next year because the 2013 annual financial reports filed by those political parties and constituency associations, which are due March 31, 2014, will include all of the general election transactions as well as the rest of their annual transactions. They're going to be more complex and more time-consuming to review. We have temporary employees on for a longer period of time in the fiscal year following a general election while they review those more complex annual reports.

Voter education includes our ongoing public education work, including school kits used in classrooms. The spending for '14-15 will decrease as we focus on finalizing the 2013 election and enumeration and finalizing the reports for those events.

At $8.21 million, our ongoing core services budget request for '14-15 is the same budget as the current fiscal year, and it's 19 percent less than the budget we had 13 years ago. Elections B.C. is always aware that we rely on money from the taxpayers, and we're all taxpayers too. We will continue to be prudent in all of our spending.

On page 13 of the document there's a pie chart showing the ongoing operating budget for the next year. It shows that salaries, rent and information technology take up most of our budget and leave us little flexibility in other areas.

If you turn to page 14, you'll find the capital asset request. The capital budget request of $700,000 is the same amount that this committee recommended last year. We've consistently tried to minimize our capital investments, but the election business is highly reliant on technology, and there are some capital assets that really must be developed in order for us to maintain our work and to continue to meet our mandate.

These include the temporary employee payroll module of the electoral information system. That system was developed in the late 1990s, and it's used to pay the over 33,000 employees that we have on general voting day.

[1120]

We also need to renew our inventory distribution system, which is over 20 years old now. That system is key to managing the receiving, storing, unpacking and distributing of the electoral supplies to the 91 district electoral offices. For the May election that material filled more than 11 semi-trailers and seven five-ton trucks, so you can appreciate our need for a modern and robust inventory system.

The third large capital project for next year is a filing system to allow candidates' financial agents to file election financing reports electronically. That's something that they've been asking for, for some time.

Keith has already talked about the white paper on local government elections, a reform that outlined government's intention to introduce legislation next spring. That legislation would significantly change and increase our mandate. Specifically, the proposed local elections campaign financing act, or LECFA, would make Elections B.C. responsible for the campaign financing and third-party advertising of local government and school board elections, including ensuring the compliance and enforcement of those provisions.

This proposed increase to our mandate would have significant implications on Elections B.C. if it is passed by the Legislative Assembly. While we fully understand that it's unusual to request funding for a mandate that doesn't officially exist, the fact is that if the Legislative Assembly does pass the proposed legislation, we have to be in a position to administer it. Those elections will be held next November, so the timeline is quite short.

Our funding requirements for this preparation work in '13-14 are modest. They're on page 15 of the budget proposal. We're requesting access to contingency funds so that we can pay staff to plan the transition and change to our organization; develop training materials, forms and guides for local candidates; and attend training sessions that are held by the local government management association.

We also need to incur an estimated $70,000 in capital expenditures so that we can begin to modify our electoral information system to include local candidates, elector organizations and third-party advertising sponsors.

In the last local government elections in November 2011, there were over 3,300 candidates in 257 jurisdictions. To be able to adequately support them, it's imperative that we begin preparations immediately despite there not being legislation yet, or at this time.

On page 16 you'll find a line chart that has appeared in this document for the last several years. It shows how our ongoing core services budget decreased significantly ten years ago and that it has remained relatively flat since then.

Finally, on the last page of the proposal, you'll find the statement of operations, which is a backward-looking document. It represents both the ongoing and event-related operating results for the last two fiscal years.

Anton is now going to address the event work that we undertook this year.

D. Ashton (Chair): Good morning, Anton. Welcome.

A. Boegman: Good morning, and thank you for allowing me to present some of the key event details from the current year, 2013-14.

This year Elections B.C. has been exclusively focused on administering the 2013 provincial general election and the provincial enumeration, which we're still in the process of currently administering. Over the past 6½ months since May 14 we've been conducting reviews
[ Page 619 ]
and audits of election proceedings and election financing, carrying out extensive lessons-learned reviews to improve future event delivery and writing comprehensive event reports.

These events and this work we're still doing continually, until the completion of those reports in the new year.

Looking back at the events that we've administered, there are a number of key accomplishments and firsts for Elections B.C. and for B.C. voters. Some of these have been touched on by Keith, and I'd like to provide a little bit more detail on some of these selected areas.

The provincial enumeration, which was conducted between February 25 and April 23, was a unique event. This enumeration built from the approach used in 2009, which was a mail-based enumeration to all residential addresses in British Columbia and which added customized enumeration activities in each electoral district based on the geography, the demographics and other distinctive characteristics of each district.

In addition to this comprehensive mailout, voters were targeted through door-to-door enumeration of selected areas, through registration drives at community locations, through ongoing community outreach and education activities, and from an enumeration of shelters and site-based voting areas.

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From our perspective, the results of the enumeration were very positive. There were 250,000 voters list transactions during the event, consisting of new registrations, updates and confirmations to existing registrations and removal of voter records that were no longer current.

Although over 41,000 new voters were added during the enumeration, close to 68,000 stale voters were removed from the list for a variety of reasons, making the end result a more accurate and current provincial voters list. Indeed, our most recent quality study of the list showed currency of the voters list at the end of the enumeration at 89 percent; that is, 89 percent of the registered voters on the list at that time were registered at the correct address.

With the addition of voting day registrations and updates, the list quality in B.C. is now assessed as having over 94 percent accuracy. That's significantly better than in 2009 and represents an overall increase of currency on the voters list from the beginning of the enumeration until the close of voting on general voting day of over 10½ percent. With voters list coverage, which is our other measure — the percentage of voters on the list out of the eligible population — as of general voting day at 96.3 percent, new quality standards in each area have been achieved for the provincial voters list.

The election of 2013 also presented a number of firsts for B.C. voters. A significant focus during this event was increasing accessibility to all voters through the voter-centric model, which Keith has touched on.

We streamlined a number of administrative processes to make voting easier from the voter's perspective. The where-to-vote card — which is mailed to every voter and brought to the voting place by in excess of 80 percent of the voters — was used as a voting document in advance voting, which reduced the administrative overhead that's typically associated with this type of voting opportunity and cut over half the amount of time required for these voters to vote.

Voter registration activities at each voting place were incorporated into the actual voting process rather than being a separate stand-alone process. This eliminated this extra step for voters.

The other key efficiency we were able to put in place was that vote-by-mail packages for out-of-province voters were sent 30 days prior to the writs being issued. This step allowed the voters more time to complete the package. They had the opportunity to vote right after the election was called and then have sufficient time to send the packages back to Elections B.C. to be counted.

Indeed, those packages that were sent to international addresses pre-writ were returned at a rate significantly higher than those that were sent after the election was called — 60 percent in the case of the former, compared to 38 percent in the case of those that were requested and sent during the election cycle.

Our voter-centric model was heavily promoted by Elections B.C. and by the political parties. It resulted in many voters, some of whom might not have voted otherwise, using opportunities other than general voting to vote. Of the 165,000 additional voters that turned out to vote in 2013, all of them voted at either advance voting or absentee voting. That means general voting, in real terms, remained static over the two elections.

Advance voting, however, increased 27 percent in 2013, with approximately 370,000 voters using this opportunity. Absentee voting saw an even greater increase: 78 percent, to just under 200,000 voters.

We're seeing a significant change in voting patterns. Whereas in 2001 close to 90 percent of all voters who voted, voted on general voting day, in 2013 this ratio had fallen to under 70 percent. Thus, voters are clearly taking advantage of the ballot-box accessibility, and they're using opportunities that are most convenient to them.

As Keith mentioned, we further encouraged district electoral officers to make voting accessible and convenient by bringing voting to where the voters were or where they could access voting easily. He mentioned we had advance voting at Kelowna International Airport, and there was a DEO office that was located in a former car dealership, so they had drive-through bays where we offered drive-through voting.

Perhaps more importantly, however, we also held several special voting opportunities during the advance voting period in smaller communities in rural, coastal and northern areas. These special voting opportunities provided an advance-voting-like experience to voters in
[ Page 620 ]
these communities, and they really made overall access to the ballot box more equitable.

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The enumeration and general election, however, were not the only events that were funded in 2013-14. Almost immediately following the election, a by-election was administered in Westside-Kelowna. The current-year event budget has also provided funding for the administration of the initiative petition to amend the Police Act, which was issued on September 9, 2013, and is still ongoing.

What will the next fiscal year look like from an event perspective? It will look markedly different from our past year. While the extensive planning, preparation and delivery of the enumeration and general election will be gone, they'll be replaced by activities equally important to Elections B.C.'s mandate.

Our main focus in '14-15 will be on event readiness. However, given the potential for by-elections, for initiative petitions and our mandate for administering the recall component of the Recall and Initiative Act, we may not only have to be ready to deliver these, but we may actually have to do so.

Our event-readiness activities will primarily build from the extensive lessons-learned activities conducted this fall. We'll identify the processes and aspects that we want to change for the next election. As mentioned by Keith, this is almost exclusively taken using the lens of the voter in applying: what's the best way to serve the voter at the voting place?

We're going to further streamline the voting process, where possible. We're looking at improving our election official training methods and better integrating technology into the way that we communicate with voters, field staff and other clients. These projects must commence soon if they're to be effectively completed in time for the next election in 2017.

Those are the key aspects that I wish to tell the committee this morning. I'll now turn it over to Keith for the final closing comments.

K. Archer: I think we've just about used up our time, so let me simply emphasize a couple of key messages for the committee this morning.

First, from an operational perspective, we're presenting a hold-the-line budget request. Notwithstanding a need to cover salary increases, we're seeking the same funding as was supported by this committee in our submission last year.

Second, from a capital budget perspective, our request is for a modest upgrading of key information technology infrastructure.

Thirdly, within our existing mandate we're not seeking any funding increase. However, as our mandate changes so, too, must our resources to meet the new challenges.

We're anticipating a change in the mandate with respect to the role of Elections B.C. in overseeing financial reporting with respect to local government elections. At this time we're seeking modest funds from the contingency fund for the current fiscal year to complete tasks that must be completed now if we are to successfully oversee financial accountability for local government elections in fall 2014.

With those comments, Mr. Chair, I turn the meeting back to you and look forward to responding to comments and questions.

D. Ashton (Chair): Doctor, thank you very much. I do have some questions already.

M. Hunt: First of all, having a constituency that has a large number of snowbirds and students in it, I want to thank you for the everyday voting, which was absolutely phenomenal, as well as the mail-in ballots. They worked just beautifully, and it was wonderful to be able to give people those opportunities. "Sorry, Marvin. I can't vote for you because I am off" — you know. It was wonderful.

My questions are concerning enumeration. In particular — again, coming from the city of Surrey, we have 100,000 secondary suites — my question is: how do you know that you actually got them, and how do we work with that? I realize identification can be, on one side, a barrier to election, but by the same token, when I want to drink my water, I'm really happy for multiple barriers to keep diseases and germs out of my water, so barriers also have positive effects.

I'm wondering: how do we deal with secondary suites? Also, how do you deal with someone who is applying who lives on the fifth floor of a three-storey building?

K. Archer: Okay, let me try to answer your question from a more general perspective, and I'll ask Anton to fill in some of the details on a specific approach within a secondary suite.

As we developed our strategy for enumerating this time around, it was clear to us that although British Columbia had a high-quality voters list, it wasn't universally high. But because the nature of our challenge was to improve the quality of the voters list in all 85 electoral districts, it was hard using survey sampling techniques to get a statistical reading of the quality of the voters list across those 85 districts.

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The sample sizes would require a budget that was not reasonable for the task, and so our approach was to engage our 85 district electoral officers and begin with the premise that the people who are best equipped to design and implement a voter list update just before the event were the people who live in and know that area. So the 85 district electoral officers are people who live in the district, who are going to run the general election in that district, who know their communities.

We developed what we call the toolbox of approaches
[ Page 621 ]
that they could use to go into the field to improve the quality of the voters list in a way that's sensitive to the particular requirements of their district.

In some districts, that meant there was a need to engage with First Nations leadership. Because there was a First Nations community in the electoral district, we wanted to engage with them to find out what would be the approach that makes most sense in that area.

In other districts, there could be new residential communities that have developed, and many of the people in those new homes or units may not have been in touch with us to provide updated information about their address. Part of the toolkit was to go door to door to those new communities and to update the voters list in that way. So it was a locally developed, locally responsive approach overall.

In terms of the particular question of secondary suites…. Anton, is there some further information you can provide on that?

A. Boegman: Certainly. Yes, I can add some specific tools that we use to ensure that we do try to reach as many voters as possible, including some hard-to-know-about places, like secondary suites.

One is that Elections B.C. has a very detailed address register that we maintain. It has addresses in it from all voters who are currently registered and previous address points that voters have used. That's stored in the memory of the system. If someone has voted living in a secondary suite, we will have that information on record.

The second tool that we used for the first time this time is that when we did our mailout, we did it in conjunction with the Canada Post point-of-call database. This database is what Canada Post has developed to enable their letter carriers to visit each point of call. So the point of call for one house, if it has a suite, would include two points of call for that. We made sure that we were targeting every single residential point of call that we could in the district.

Keith has mentioned local knowledge. Local knowledge certainly played a great part. I know that in a lot of cases our district electoral officers were able to hire people who had recently been involved in the census process. These individuals were able to leverage their knowledge of where different locations were, where different suites were.

While certainly there's no guarantee we can reach everybody, we did make concerted efforts to try to make sure that we reached as many residential address points as possible.

We are also fortunate that legislation, of course, in B.C. allows anyone to register or update their registration at the time they vote. So if we were not able to get you at the registration point, we could get you when you came to vote if you weren't registered or needed to update at that time.

M. Elmore: Thanks for your presentation, and congratulations. I think you employed a very creative and innovative approach in terms of looking at improving accessibility. I also give credit in terms of the higher turnout, certainly, to those measures and that flexibility. Congratulations on your work.

My question is with respect to the voters list. Also, I'm very interested to hear about efforts to update that. Is it correct that the coverage is 96.3 percent and the currency is 94 percent?

A. Boegman: That's right. So 96.3 is the coverage, and 94.2 is the currency. That gives us a net coverage of over 91 percent.

M. Elmore: Okay, over 91. So I guess that would leave, with my calculations with the 2011 census, about 162 folks — those tough folks to get onto the list.

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My specific question is…. I appreciate the individualized approach, which I think is advantageous in terms of each district. Typically, the areas that are underrepresented are First Nations — indigenous communities — and also new immigrants, youth and renters. Did you have any specific efforts particularly with respect to new immigrants and young voters?

K. Archer: The effort to get young people onto the voters list is a real challenge. I think we need to acknowledge that to start with. I think we also need to acknowledge we haven't solved that problem yet. I was, quite frankly, a bit surprised when my career shifted from a university over to an election agency and I began to look more closely at the quality of the voters list for youth. The situation is worse than I thought it was.

I don't think British Columbia is alone in this. I think in this country we have a hard time getting people onto a voters list when they turn 18. The most recent data I looked at on the percentage of young people on the voters list was from 2009, and the percentage was around 68 percent of people either 18 to 24 or 18 to 25 — the youth category that was focused on.

That means that one out of every three young voters is not being contacted by us directly and may not be contacted by the candidates either, if you're relying on the voters list as your point of contact. We need to find ways to improve the quality of the voters list for young people. I think that's an important challenge between now and 2017.

I suspect that will be one of the issues that we examine in our report on the enumeration project that will be submitted to the Legislative Assembly in the new year. And I wouldn't be surprised if this is a topic that we take up in the recommendations for legislative change, because it's an important ongoing issue.

I have made a recommendation to the Legislative
[ Page 622 ]
Assembly with respect to being given the authority to maintain a provisional list of electors for 16- and 17-year-olds. That's one way of trying to get in touch with young people to get them onto the voters list. Doing it at that age, I think, will give us some inroads into the secondary school system — and then partner with the education authorities.

I'm speculating a little bit here, Mable, because we're still in the process of developing our full strategy for this topic. But I do want to acknowledge it's an important challenge for us.

Now, what we did in the current event was to ensure that as part of our enumeration campaign…. As Anton mentioned, we had this campaign that lasted from March 6 to 23 in which we had activities taking place in all 85 electoral districts. One of our requirements of the teams in each electoral district was that "if you have a post-secondary institution in your district, have a presence in that institution during the enumeration period."

Again, these are early steps to improve the quality of the voters list for university and college students. I think we can do more in this regard. But there was a focus of some of our activities on that topic for the current election.

With respect to other communities, whether they're First Nations communities or ethnic communities within an electoral district, those communities typically were identified within the enumeration plan of the district electoral officers, which we reviewed centrally. They were encouraged to engage with those communities in ways that made sense within the area in which they were working.

[1145]

I would expect that in the enumeration report that will be forthcoming, we'll be providing a lot more background and a lot more data on exactly what those contacts look like. But I can provide assurances now that that was an important focus for our activities in the spring.

G. Holman: Thanks very much for your presentation. I had a question about First Nations. I have four reserves in our constituency. Can you provide statistics data on the participation rate overall for First Nations, and is that trend going up or down? Do you have any information? Would measures to improve participation rate among First Nations be part of your recommendations that you referred to earlier?

K. Archer: I'm going to ask Anton to answer that question in its fullness. What I can tell you is that because the voters list doesn't include information on a person's ethnicity or on their identification as a member of a First Nation, we actually don't track that. We can't track that with the data sources we currently have.

Anton, perhaps you have more to add on this.

A. Boegman: No, I was going to say the same thing in terms of we don't have that information currently listed as a field in our voters list, and we don't have legislative authority to track ethnicity of voters.

Certainly, there are ways to look at it. Some First Nations communities had a dedicated voting place right in their community, so there would be a registered voter count for that voting area, and the statement of votes will provide information on the number of voters that voted at that opportunity. However, some of these locations were not exclusive to First Nations individuals, so other voters could have come into their community to vote. It's kind of a mix.

I can say that each one of our district electoral officers that had First Nations communities in their district did contact those communities, did follow up those communities, did talk with them about what voting opportunities there were — what voter registration opportunities there were, what opportunities there were for employment as election officials — and certainly tried to put in place a model that best met the needs of each individual First Nations community.

Some felt very comfortable with going to assigned voting places outside of their community. In other cases, teams were sent to those communities in order to administer voting.

G. Holman: Just one quick follow-up. Are you considering increasing the number of polling booths on reserves as one way to try and encourage turnout in those communities?

A. Boegman: It's certainly something that we are going to be looking at when we've finished reviewing all the reports from our district electoral officers. As I said, what we really want to make sure we do is that we provide equitable access to voting opportunities and that we provide services that meet the needs of the various communities. In some cases, there will likely be additional voting stations or voting opportunities, if the DEOs feel that that's the best way to provide equitable access to the ballot box.

D. Ashton (Chair): Just before I go to Mike, Anton, I cut you off with Mable's question, and I apologize for that. I caught her before she stepped out. She said that if you wanted to comment, it would be on the record, and she would be able to pick it up.

A. Boegman: Certainly. I was just going to provide a bit more detail from what Keith had talked about — the efforts that we did to engage ethnic communities and youth voters.

I have some numbers in terms of the community outreach activities that we did during the enumeration to First Nations and other ethnic groups. There were close
[ Page 623 ]
to 150 events that were held. These are specific events that would be providing information and voter education services to those groups. We also did a further 959 registration drives to help provide voter registration opportunities to these groups.

In regard to youth, we had two specific partnerships that we embarked on with Apathy Is Boring and Get Your Vote On. While I certainly agree with Keith that more needs to be done in this area, we were successful in having new registrants of just over 15,000 in the 18-to-24 age category during the enumeration, and during the general election there were a further 26,665 voters, 18-to-24, that were added to the list. So there are some benefits there.

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M. Farnworth (Deputy Chair): Following up on the youth vote in particular and getting more people registered to vote, has any thought been given to initiatives such as when you enrol at a post-secondary educational institution, you automatically get enrolled on the voters list? I mean, it would strike me as something simple. It's like: you're signing up; you're enrolling; they have all your information, your data — your date of birth, your address where you're living; and you automatically get enrolled to vote as part of it.

Likewise, with social housing that the province provides or Metro provides or other communities provide around B.C., often there's high turnover. As part of your tenancy agreement and moving into one of those projects, you're automatically enrolled to vote.

K. Archer: That's an interesting observation. When I was meeting with some of the senior administration folks at the University of Victoria back in the spring and reflecting on ways in which we can encourage younger people to get onto the voters list, one of the suggestions was that we may want to do that kind of automatic checkoff kind of system. We haven't explored the full capability of doing that yet. We would need to certainly partner with the post-secondary institutions.

From initial conversations, I think they'll be very willing partners to do this. We'll also want to ensure that the information is being managed in ways that comply with our FIPPA requirements, for example, with respect to data sharing. That's the kind of new approach that we'll need to begin exploring in much more detail in the coming years, to ensure that…

M. Farnworth (Deputy Chair): Seniors care homes would be another one as well.

K. Archer: Yes.

…where good data are held about people, to have them confirm their eligibility. That will be a necessary part of a process — confirm their eligibility. Once that eligibility is confirmed, if we can get data exchange agreements in place that facilitate that receipt of information on our part, I think the task will become less of a challenge.

D. Ashton (Chair): Mike, is that okay?

M. Farnworth (Deputy Chair): Yeah.

G. Holman: Just quickly. It's a huge topic, I know, but do you have a view on mandatory voting, as in Australia? Have you considered it — in 25 words or less?

K. Archer: My view is to administer the Election Act. If you have views on that and sort them out and the Election Act reflects those, then we'll respond.

J. Tegart: Thank you for your report. It's very interesting to see the innovative ways that Elections B.C. is looking at increasing participation in elections.

Do you have any idea how many downloads there were on your app?

D. Main: We do. Thanks for asking. It was a great project to work on. Before general voting day we had about 17,000 people download the app, and on general voting day there were about 12,000 people that actually used the app.

J. Tegart: Wow, excellent. Thanks.

D. Ashton (Chair): Folks, just before we go, a quick question. Other statutory officers have blended opportunities together. It's my understanding that with yours, there's $700,000 for computer services plus an uptake this year because of inventory and that. Is there an opportunity of blended services for information storage and information?

N. Western: You mean like for information technology specifically?

D. Ashton (Chair): Yes.

N. Western: I think our information technology needs are significantly different than the other offices. We have over 3.2 million voters, so the amount of data that we have in our systems is incredible and much, much larger than the other offices. The actual storage isn't as expensive as it used to be. The $700,000 isn't for storage. It's for the systems, the applications — the actual system that we use on our desktop to manage the voters list.

D. Ashton (Chair): I thought that when you had mentioned inventory, you mentioned there was going to be an uptake in inventory because it's 20 years old.

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I was going: "Well, there is lots of opportunity of shared
[ Page 624 ]
services for inventory control." So I'm just asking because of….

N. Western: Well, this system is specifically for the election materials that we use, and we distribute to 91 offices. We have a 14,000-square-foot warehouse full of election materials. Or it's not so full right now because we're not stocked up. But it's a very unique distribution system, and there isn't anybody else in government that does that sort of work. In fact, our warehouse supervisor came from government assets and recovery. He came from the government warehouse, and this is completely unique to anything he's encountered.

D. Ashton (Chair): Okay. I'd just like to plant the seed for opportunities. We all seem to have these silos with everybody that has all this…. So I'll just leave it with you.

N. Western: Yes. The first place we will look to when we start to work on that project is the other electoral jurisdictions in Canada. That's where our real opportunities may exist to share.

D. Ashton (Chair): Okay. Perfect.

Well, thank you very much, folks, for the presentation. We'll be convening ourselves and having a chat. Then the distribution of the information from us will be coming out at the reporting period.

We will recess till 12:30. Is that okay with everybody, please? Thanks.

The committee recessed from 11:56 a.m. to 12:30 p.m.

[D. Ashton in the chair.]

D. Ashton (Chair): Welcome back. Now we have the Office of the Conflict of Interest Commissioner, Paul Fraser, and Linda Pink.

Folks, welcome. Thank you very much. We have 30 minutes for the presentation and 15 minutes for questions, but there will also be a bit of an in-camera session on it, so maybe if we could pull our horns in a little bit on the 30 minutes and give us an opportunity to go in camera.

P. Fraser: Thank you, Mr. Chair.

D. Ashton (Chair): Thank you. Thanks for coming, sir.

Office of the
Conflict of Interest Commissioner

P. Fraser: Not at all. It's a good day to be inside where it's warm. It's one of those days that reminds you of the old Beyond the Fringe story about people who were judges and, in this case, legislators. It's inside work, and it's warm, and you can't ask for anything more than that, especially as we see the snow out the window.

The proposal has been circulated, and I'm going to take it as having been read so that we don't replow the fields. I simply wanted to begin by telling you that I'm genuinely pleased to be here because not only do we have an opportunity to discuss the budget proposal, but we will have a broader opportunity, perhaps, to discuss the work of the office.

It's important, I think, for anyone scrutinizing, either within this room or watching us on whatever medium we are or reading this transcript, that we understand that as an officer of the Legislative Assembly, my immediate loyalty is to the Legislature, who have appointed me, and it's to the Legislature that I report directly. It's work that we do in the public interest, but we don't report directly to the public. We provide information to the public.

It's also, I think, important to understand that any recommendations or any findings that we make are simply that. They're not decisions. Those of you who are familiar with the act will know that at the end of any of our adjudicative processes, where there's a recommendation, it's for the Legislature to decide what the result will be, if there's been a recommendation for a penalty after a found breach of the act.

As an officer of the Legislative Assembly, there aren't many occasions for me and, I'm sure, for the other officers to talk to our bosses, who are, some of them, collected in this room today. There's always a problem with the term "accountability" because there are people who want to make the point that the offices are independent. I don't think anybody disputes that, or wants to, but the reality is that everybody's accountable to those people who appoint and employ them.

So, for me, this is an opportunity to, effectively, report to you on the work of the office in the context of making submissions and a proposal to you about how our work should usefully go forward. And I'm pleased to do that today with the assistance of Linda Pink, who you all know.

The background information, which is at the beginning of the proposal, is all old news. What I want to do now is move quickly to the core of what informs the budget proposal.

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What I'm asking the committee to do is to consider our process and consider our proposal and understand, to the extent that I can be sure that I'm doing so, that what the proposal contemplates is that we simply consolidate the workforce that is already in place in our very small office.

We provide a service directly to the members which, as we all know, is confidential. That confidentiality is absolute as far as the office is concerned, and it's absolute as far as members are concerned if we are going to effectively be able to provide counsel and discussion as
[ Page 625 ]
problems occur.

That means, in turn, that the workforce that we have has to be stable, it seems to me, by definition. We can't, in running the office, find ourselves in a situation where we've got people coming and going. The reality is that knowing that, over the last six years what we have been able to do, partly through the generosity of those that work for us, is to maintain an absolutely stable workforce so that we're not involved in retraining. We're not involved in having obvious concerns about people leaving our employ and going elsewhere and taking with them, at least in their memories, information which is very, very sensitive.

Obviously, there is no way of making the workforce immutable, but what we are seeking to do in this proposal is to essentially consolidate our workforce, continue to have a stable workforce, worry about issues like retention of employees, worry about other ancillary issues like succession. Almost more than anything, what we want to do is to treat fairly those people who have invested their time and energy as our employees to this point in time.

Frankly, what has been happening — I think it's well understood, certainly in our office — is that over the years as we've met various committees, we've listened to instructions that have been given to us effectively in advance, instructions in the sense of useful directions: hold the line, make sure that we don't go over in areas where there is any sort of tolerance or discretion in terms of spending.

All of that is fair enough, but at the end of the day, when I sit and look at where we are and where we have been, I realize that, in very simple terms, what has happened is that by using contract employees in some cases, we have been able to keep down the cost of doing business by not having to pay benefits and that sort of thing.

As a result, we've been able to use the funds that have been given to us by various committees to do a variety of other things that have to do with our work. But we've now reached a stage where we need to retain the people who have made that investment with us and with their energy and treat them fairly.

In bottom-line terms, what's underlying this proposal is that we want to take one of our key employees, the legal officer, who is now on a contract, and make her an employee, which means that she would then have some job security, because the contracts that we have signed have been basically year-to-year contracts. She would have the kinds of benefits that we all aspire to if we want to stay in a position and improve not only the work that the office does because we're there but also our own situations, in terms of financial planning and so on.

[1240]

We want to achieve that conversion as quickly as we can — that would be at the end of this fiscal year and not before — in order to retain the services of that person.

We have another contract employee who wants to stay on as a contractor and is quite happy to do so. But as things have turned out and for the reasons that I'll explain, we need to increase her hours. She's at the moment two days a week, and we want to move it up to three days.

I appreciate that all of this sounds like too much detail. In effect, what it does is that it tells some of you who have been there that in our small situation at 421 Menzies Street, we're experiencing some of the same problems as small business people do, some of the same HR problems that some of you have been used to dealing with in your own lifetime. Some of the rest of us have only kind of heard about them.

Anyway, the proposal — and I'm going to get into the numbers relatively quickly — allows us to carry on our stable environment and enhance our services to make sure when we say to the members, as we do, that we're available 24-7 and on a timely basis, that we can deliver. I think we're delivering on that now, in the sense that when people call we get back to them quickly, and our response times are quite defensible. But we want to be able to continue to do that, because usually the questions that are being asked are important and are time-sensitive.

What I'm saying, I guess, is that we're not seeking to add any new positions. All we're seeking to do in our office is to consolidate and make sure that we have effectively got the assurance of a stable workforce going forward. You'll see on page 4 of the proposal that we've got our organizational chart — probably the most simple organizational chart in the Legislative Assembly's lexicon of organizational charts. It's got to be clear to everybody that when you're employing five people in a small office we are, as the old saying goes, fairly close to where the sausages come out. It's a pretty immediate kind of situation.

We have changed our operation slightly in the last few months because we'd had until the end of September an office, which we called the satellite office, in Surrey. It was designed to service the members in the Lower Mainland — some of you have attended there — and it provided for us the additional benefit of limiting the amount of travel expense that I, who was then living in South Surrey, in White Rock, was running up in coming back and forth to Victoria under the terms and conditions of my original appointment.

We were able to shut the Surrey office down because I decided to move with my family to Victoria. Some people would say that on an intellectual level it was a loss for both places, but here I am. In any event, you will see that there've been some savings achieved by doing that.

We have the performance information set out on page 5. I don't think we need to discuss that beyond my saying that the impact, for example, of having 32 new members elected, some in this room, has been, from an administrative point of view, considerable, as people want to become familiar with their responsibilities under the act and try to figure out the Byzantine forms that we have prepared and make their disclosures properly.

[1245]


[ Page 626 ]

All of that has had an administrative impact, and in the course of the current fiscal year, we have found that our clerical duties — the duties of processing forms and organizing events for new members and so on — have increased. That has made life difficult when the contract employees who participate in that process are on an hourly basis.

I should say, just parenthetically, that while we're contemplating having our legal officer become an employee with all of the appropriate benefits, and while there's a cost, as we'll see, to doing that in terms of the benefits, the payback, in part, is that instead of her time amounting to, as it does at the moment, 60 hours a month on a contract basis, we'll be getting 80 hours a month. So there is a value-added aspect in terms of this particular person working longer hours in the office for what turns out to be, in relative terms, not all that much more in the bottom-line result, the cost of her services.

The chart on page 6 leads me to deal with one aspect of our budget proposals that have occurred over the years. That is this: the act that we supervise doesn't give to the office any plenary jurisdiction or any ability to self-initiate work. The Auditor General, the Ombudsperson and other officers of the assembly have that direct responsibility. We do not. I'm pleased that we don't. I won't go into the reasons why because it's not relevant today.

What is relevant is that because we are a purely request-driven process, we don't know what's coming down the line. All we know is that we can expect in the course of a year, perhaps, to be asked for formal opinions, which are the costly ones, by either members of the Legislature asking for opinions with respect to the conduct of their colleagues, or members of the public asking the same question, or as has recently happened, a member himself, under the provisions of the act, asking us for an opinion. But we can't tell in advance, in this sort of planning environment that we're in today, what's coming down the pike.

What do you do? Well, in the past what we did for some years in the office was to, obviously, make an educated guess, based on past experience, what the traffic might be. The result was that most of the time we were pretty close; sometimes not.

The year-over-year experience, as you can see on page 6, is that for the periods 2008-09, 2009-10, 2010-11, 2011-12, we probably did overestimate what we thought the business would be. When that happened, we turned back the funds that we hadn't expended. I'm not sure that it isn't a record to have done that four years in a row, but that's the way the system is supposed to work if it's working well.

Then we come to 2012-2013. We see that the request was for $480,000, and the budget approved was in that amount. But we actually spent $562,562 in the course of that fiscal year, leaving us in the hole by the amount of $82,562.

[1250]

The reason for that was that we had an inquiry that started in late September of 2012, and it produced a result in March of 2013. It was a complaint of a former member of the Legislature with respect to the conduct of the Premier. The total cost of that inquiry was $125,000. Of that amount, $100,000 was spent in the 2012-13 fiscal year, and there was a remnant of $25,000 that we paid in this current fiscal year.

In order to balance our books and deal with the $82,000-odd shortfall, we did what we have always said we would do, and that is, in the event that there was an unexpected inquiry with unexpected expense, we would come back to the committee and effectively ask for a refresher.

In this case, the House had prorogued. Is it prorogued? Is that the right expression when you're coming up to an election? The committee didn't exist anymore, and we went through a process, with the helpful guidance of Kate, that saw us go to the Treasury Board, and we were reimbursed for that.

The money was paid, so we balanced our books. We now come to this current fiscal year, where we were given by last year's committee $510,000, but we asked for $560,000. That $50,000 difference from the ask and what we were given was my saying to the committee last year: "We're just in the formative stages of this inquiry. I don't know how it's going to turn out financially, but we may be down as much as $50,000 next year if the way I read the tea leaves is likely to turn out to be true."

The committee, perhaps not surprisingly, said: "We understand your dilemma, but we would prefer a process that we not give you a contingency amount for a contingency fund. We'd rather say to you that if you need the money, in fact, then come to us after the fact, and we'll deal with it then." I'm quite content to do that. It seems to me that's a sensible way to do it.

It also, frankly, has a certain amount of fiscal purity in the sense that we can then concentrate on what our core obligations are, that is to say people — which is what our office is all about — and the services they provide and what it costs us to get them to do that, without worrying about building in all kinds of extra contingencies in our budget request.

I hope that sort of approach will find favour going forward in this year and in the forthcoming years.

D. Ashton (Chair): Mr. Fraser, can I just interject for a second? I'm very cognizant of the time because we have people coming in at quarter after. There is a question period that we're going to go into, but I do want to go in camera. With respect, if we could get close to wrapping up so we can flip into the in camera, please.

P. Fraser: Happy to do that.

D. Ashton (Chair): Thank you.
[ Page 627 ]

P. Fraser: The numbers that we're seeking this year are $567,000, which is a lift of $57,000 over last year. You have on page 9 the projected numbers, and you have on page 10 the notes to the various STOBs, where you would be interested because the amounts have changed in the course of the year. The change is significant enough to require an explanation, and the explanations are all given there.

[1255]

The short answer…. If I can anticipate, Mr. Chair, a couple of questions. We anticipate that there will be, at the end of this fiscal year, a $50,000 deficit. That is sort of what we had predicted might happen, and it has. It has happened because we have the $25,000 remnant from the inquiry that I mentioned to you before. It has happened because, obviously, there have been some inflationary costs that aren't discretionary, if you like. They're built in.

The commissioner was asked — as, I gather, deputies and other officers of the Legislature were — to participate in the green lease program with a hybrid vehicle. I did that, so I have a leased vehicle that is hybrid. The costs of all of that have been added to my budget. I think it's a very good program. Part of the cost that has come out of the budget would have been there in any event on the car allowance program that formerly existed and, I guess, still does. But I thought that this was a more responsible way of dealing with the transportation problem.

We've got the rest of the $50,000 that would take us to where we anticipate — and it's just a guess — we will be at the end of March. We are currently involved in another investigation in the office, recently announced. At this stage it's difficult for us to predict and project its final cost. But I think it's going to be well contained. I think at the end of this fiscal year we will have produced, unfortunately, a loss of $50,000. But it's all explained and, quite frankly, was anticipated.

The $57,000 lift that we're asking for can be explained in this way very quickly: the cost of moving from a contract situation to an employed situation for the legal officer; the cost of increasing by a third the contract value for the contract employee who is on the clerical side; the standard attribution for inflation; the continuing expense of the green program with respect to the car; and a notional assignment, on a continuing basis, of professional services that may be necessary to be provided to the office. All of that in various amounts adds up to about $57,000.

You may have a question about why the professional services, STOB 60, amount to $52,000. That is because, in the way in which STOBs work or don't work, of that $52,000, the contract clerical employee is responsible for $35,000. So that $52,000 is inflated. That would otherwise be a salary. But because she's not an employee and would then be under STOB 50, she has to remain under STOB 60.

That's the explanation for the ask. I hope that's the information that the committee will require. The last couple of pages of the submission are just a pie chart to give you sort of a visual of what it looks like. As you can see, the vast majority of our cost is people.

D. Ashton (Chair): Thank you.

Could I get a motion to go in camera at this time? We'll come back for questions after.

The committee continued in camera from 12:59 p.m. to 1:07 p.m.

[D. Ashton in the chair.]

D. Ashton (Chair): Now we're back in. Are there any questions of the Conflict of Interest Commissioner or staff regarding their submission for their budget? Any questions on that?

E. Foster: Commissioner, you referred to a fairly expensive investigation that you did. If I'm not mistaken, you went to an outside commissioner. Could you give us an idea of the cost of that outside commissioner?

P. Fraser: I'm going to say that his cost was roughly $60,000. I can….

E. Foster: No, that's fine.

P. Fraser: I'm sure that was his cost. Linda is looking up some actual numbers, and we may be able to come back to that.

D. Ashton (Chair): Okay. Any other questions while Linda looks those up?

P. Fraser: I can say, Mr. Foster, that he was supported by our legal officer and by the counsel that I use from time to time in the office, where necessary. All of that was in an attempt to keep the numbers down.

I've misspoken. His cost for the services alone was about $44,000. Then there were travel expenses he cited in Saskatchewan, and some other disbursements. So all in, for him, that would be just over $50,000.

E. Foster: Okay, so that is the real cost of having him on the…?

P. Fraser: Yes.

D. Ashton (Chair): Any other questions?

Sir, thank you very much for coming forward. Greatly appreciate it.

Linda, thank you. Nice to see you again. Thank you for being prompt and on time.

We'll just declare a quick recess until quarter after, till the other folks are here.
[ Page 628 ]

The committee recessed from 1:10 p.m. to 1:14 p.m.

[D. Ashton in the chair.]

D. Ashton (Chair): Good afternoon. Thank you very much for coming.

We have before us the Office of the Auditor General. We have a 45-minute presentation and up to 30 minutes for questions. So Russ Jones, Malcolm Gaston and Katrina Hall, and who did I forget? We're missing one. Who didn't I mention?

Interjection.

D. Ashton (Chair): Marc. There you go. Welcome, sir.

Sir, the floor is yours.

R. Jones: Thank you very much. Good afternoon Chair, Deputy Chair and members.

D. Ashton (Chair): Actually, sorry. Before we do, can we just do a quick introduction? Gary, may I start with you please?

G. Holman: Hi, Gary Holman, MLA, Saanich North and the Islands.

L. Popham: I'm Lana Popham. I represent Saanich South.

M. Elmore: Good afternoon. Mable Elmore, Vancouver-Kensington.

M. Farnworth (Deputy Chair): Mike Farnworth, MLA, Port Coquitlam.

J. Schofield: Josie Schofield, parliamentary committees office.

[1315]

B. Plant: Byron Plant, research analyst to the committee.

K. Ryan-Lloyd (Clerk of Committees): Good afternoon. Kate Ryan-Lloyd, Clerk to the committee.

J. Tegart: Jackie Tegart, MLA, Fraser-Nicola.

M. Hunt: Marvin Hunt, Surrey-Panorama.

S. Hamilton: Scott Hamilton. I'm the MLA for Delta North.

E. Foster: Eric Foster, Vernon-Monashee.

D. Ashton (Chair): Good afternoon. Dan Ashton, Penticton.

Sir.

Office of the Auditor General

R. Jones: Thank you very much, and good afternoon, again, to the Chair, Deputy Chair and members. It is my privilege to be able to meet with you today to discuss our 2014-15 Estimate of Resources for my office.

Because this is my first opportunity to meet with the committee in my role as Auditor General, I'd like to take a moment to outline for you my three core values that underpin this request. I think it's very important for you to understand where the office is currently coming from in terms of these three core values.

Right off the bat, I just want to say I am very proud of the office's long history of delivering high-quality reports and recognize that quality, in everything we do, is paramount. I also know that legislators, the public and public sector entities expect my staff to be competent. They expect them to be objective and embody the right level of professional skepticism while maintaining open dialogue on all issues that we come up with.

I believe these three core values that I'm going to outline for you ensure that we achieve audit quality and quality service at the same time.

The first one that I want to talk a bit about is investing in relationships. I believe that the professional relationships that the office fosters with legislators, with the public sector entities that we audit and with management allow us to have open and candid dialogue over the issues, even when difficult questions have to be asked.

These relationships also allow us to provide timely advice, which we are gladly willing to give whenever we're asked; enable us to better understand the business of the public sector and ensure that clients are treated fairly.

The second key value that we strive for is, as I call it: putting ourselves in other people's shoes. That's really being customer-focused, and it's critical to our success. Listening to and understanding others' perspectives allows for enhanced dialogue and allows us to think about issues from various points of view.

We consider issues from multiple perspectives whenever we're out there. We start with our professional standards, which we have to abide by, and include views of legislators, the public sector entities and management. We also assess what other stakeholders expect in our reports.

While we will express our views, we don't impose them upon anyone, unless there are no other alternatives that exist for us within the standards that we operate under.

Then, the final core value that we really, really believe in here is enhancing value. Our understanding of the business of the public sector and execution of a quality audit allow us to identify issues that are important. This allows us to provide recommendations and insights on improvements in controls, in operations, governance and accountability that can enhance the value proposition for all stakeholders in the province.
[ Page 629 ]

With these values as the foundation, let me provide you a bit more context behind our budget request. Our office is continuing to pursue a long-term strategic direction in fulfilment of its responsibilities under the Auditor General Act.

We are currently undertaking our own core review and strategic renewal. As part of this, we have undertaken a strategic planning exercise to confirm our corporate priorities going forward. This exercise has included input from both stakeholders and staff and will lead to a service plan in the new year that is focused on us making a difference by doing the right work, in the right way, at the right time, and striving for excellence in everything we do.

As outlined in the Financial Statement Audit Coverage Plan that you have in your package — and we presented that to PAC on November 19 and got their blessing on that Financial Statement Audit Coverage Plan — the office is responsible for directly auditing the province's summary financial statements and the financial statements of 19 public sector entities as well.

In addition, we oversee another 28 organizations' audits that are conducted by the private sector, but we attend all the audit committee meetings and look at the plans and work that's done by those auditors.

[1320]

Together this covers about 84 percent of government's total revenues and expenses. We're expecting this year to complete approximately 69 financial and performance audits and other pieces of work similar to the information piece we put out on B.C. Transit not too long ago.

The requested appropriation that you have before you is required for my office to be able to fulfil the mandate that we've been given and to carry out what I believe to be the necessary financial and performance audits to meet our mandate.

The next section I've got here talks about how we're trying to be fiscally responsible, going forward. My office is committed to being fiscally responsible, and we are not requesting any more funds than we feel we do need to fulfil that mandate and meet the necessary requirements to fill the office relocation, which we're going to talk about a little bit in here.

We believe that our base operating budget is sufficient to undertake the necessary and planned audits that we have for next year. We have a lot of pressures on us from evolving accounting standards. They continue to evolve. Market demand for qualified accountants right now is still putting pressure on our office to try and get people in.

One of the key things that we have to ensure is that the office's training and development needs are met, because that's critical to our staff achieving our mission.

All financial auditors are required to be fully conversant in not just one accounting standard — the public sector accounting standards — but also in what we refer to as international financial reporting standards, because there are a number of government organizations such as B.C. Hydro and Lottery Corporation that report under those standards, and they are very different. So our training program tries to keep everybody up to speed on that.

We also have a number of performance auditors in the office that also need to be trained, because the skills required to carry out performance audits are slightly different than financial audits.

What we have been doing over the last year is leveraging with the Auditor General of Canada and other audit offices across the country to try and get the biggest bang for the buck. We have some e-learnings that the Auditor General of Canada has prepared in conjunction with Deloitte Touche that our financial auditors utilize to get up to speed on new accounting standards in the public sector.

If we had Deloitte coming in and doing one of those for our staff every other week, it would be about, I'd say, 20 times the price we ended up having to pay for all of our staff to be able to access these e-learnings. So very good cooperation across the country.

In our performance audit area, what we are doing is…. We haven't really expanded the number of staff we have in the performance audit area because we're utilizing our financial staff when there is time, in the times when they're not completely working on financial audits. It gives them something a little more interesting than just financial audits to work on. That works out very well for us. It also allows for much better use of all of the staff that we have.

We also…. It may not be something that many people here are aware of. We get involved in a number of what we call global corporate citizenship type of arrangements. There's an organization called the Canadian Comprehensive Auditing Foundation that has been here in B.C., actually, providing some education to the Public Accounts Committee. They also do that across the world, basically.

Kudos to our office that we have been requested to go and provide and help them provide that education to a number of countries across the world. We've had staff that have been down to Bermuda. Malcolm's heading off to Ghana in a week. That doesn't cost the office anything other than time. Everything else is paid for.

Believe me, it's normally the executives that are required to go do this. Speaking for myself — and I know for Malcolm and the rest of the executive — the amount of overtime that's put in more than makes up for the four or five days that are required to go out and help with that education. Three years ago I went over to Abu Dhabi and helped set up their audit office over there, and it was all paid for as well.

[1325]

It doesn't really cost the office anything other than time, but the reputation, I think, that we also have out there in the international community is well worth the time and effort.
[ Page 630 ]

What you will also note in the package is that our budget, compared to other offices across the country, hasn't really changed, in terms of where we rank, from previous years. If we receive the requested base operations appropriation, we maintain that relative standing. I think that's in the last appendix to the estimate of resources — or near the end, anyway; one of the last two.

The big ask we have for the coming year is, of course, around our office relocation. For those of you that may not have been on the committee in the past, we currently operate out of two locations, which makes it not ideal. Last year we requested and were supported in wanting to move out of the office. With that support, we've entered into negotiations and signed a 20-year lease for the Argus building, which is the new building going up across from the Bay Centre. It's a hole right now. There's not much there to see, but something will be going up fairly soon.

Part of the reason we had to move was the place we're at, at Bastion Square, was going to require at the end of our lease, which is next November, seismic upgrading. It was going to require a new HVAC system. The owner had already told us they were going to double the rent. Regardless of whether we moved or whether we stayed, it was going to cost more. It was an opportune time, and the committee last year agreed it was a good thing to do, to get a new building.

In our negotiations with the new owner, we were given a $65-per-square-foot tenant improvement allowance — which apparently is okay but not great. That's supposed to cover all leasehold improvements. There are some that it doesn't cover, like a security system, which we need because there are a lot of people that try to come in and steal stuff from us. We have a lot of important documents that some people would probably love to get their hands on, and a lot of computer equipment too. It just provides good security for our building.

The allowance does include paint and carpet and ceiling finishes — the regular stuff you would expect. These other things, like security systems, it doesn't cover. We're finding that we're a little bit short for everything that we need to get done. You'll notice that in the request.

We're still working on refining the cost estimates associated with the relocation. The office will incur significant one-time costs, as you can imagine. When you're moving from two buildings to a new one, it's going to cost some money to do that. Over and above the base operating budget, we need some money to support that move.

The costs that we're asking for in the move are both operating and capital. It includes movers. It includes some additional tenant leasehold improvements, some furniture and equipment, to meet the needs of our open office concept. Some of the old furniture…. We've got some old furniture in our current office that…. Actually, the desk that I have was one that was used by Erma Morrison, who was the first Auditor General back in '76. It's too big for the offices that we're building in the new place. So we have to replace some furniture and fixtures.

The movers for our furniture, IT equipment and whatnot and the costs that we're going to incur when we're vacating the premises is probably going to come to close to $102,000. Leasehold improvements that we need additional funds for are required on the first day of occupancy — as I said, for the new security system as well as for something we want to try in our building, which is a noise-cancellation system.

Because we're moving to an open concept…. I think B.C. Ferries has it in their buildings. It's called pink noise. What it does is that in an open concept, it allows people to talk and other people not to notice it so much. It's very innovative, and it allows you to save costs on having a lot of offices and whatnot.

[1330]

That quote has come in at about $118,000 for the security system and that noise-cancellation system. That would be capital. We're working to bring the figure down, but at this point in time, the figures you've got are the ones that we've been given quotes for.

We had a designer prepare plans for the new office to ensure that the most efficient use of space has been done, and implementing the plans requires about $170,000 in capital and $140,000 in operating funds. It provides us the opportunity to replace the remaining out-of-date non-ergonomic furniture that we've got. We're just finding a whole lot of people getting back issues and all sorts of things because we've got old furniture right at the moment, so we do need to replace some.

Without the funding, we're going to have to probably ask the designer to redo the design for the office, because we will have to include some of our old furniture, which won't fit in this new office plan.

The office is taking approximately 65 percent of the current workstations we have because we do have workstations right now that do fit in a nice open concept configuration.

We will also need some funds to purchase and install audiovisual equipment for additional meeting rooms that we're going to have. We're short meeting rooms right now in our office. We do a lot of conference calls with our clients across the province, and without them, it would entail more travel expenses.

We got quotes, initially, for new AV equipment, and it came in at about $394,000. Recognizing that this probably wasn't going to go anywhere, and I wasn't too pleased by it either, we have managed to reduce that down to $80,000, which is not bad. What we're going to try and do is utilize as much of the current equipment that we've got, even though some of it has maybe probably only got two or three years left. It's better, I think, than spending $400,000 right now.

The one big issue we have with the new building is LEED improvements — tenant improvements to pursue a certification under Leadership in Energy and
[ Page 631 ]
Environmental Design certification. If anybody was listening to the PAC meetings last week, James Mack, head of the climate action secretariat, mentioned recently that all new public sector buildings are built to a LEED gold standard.

I'm turning to the committee to get some advice on whether or not you feel that it is behooving to us to get our building up to a LEED gold standard. It isn't our building. It's not a government-owned building. It is owned by the builder. In order to get to a LEED standard, LEED certification is one level, certified silver is another and gold is another. If we were to just try and get certified as a LEED building, it would be about $120,000 we would need. To get to the gold it's $342,000. I thought I would just put that out there for you.

Currently, the builder has got a number of LEED-certified things within the building. He has included some. The scale that's used, I think, goes from zero to 100. You try and get to 100 for LEED gold, or as close to it as possible. We think we're probably in the 25 to 30 range right now with what the builder's putting in, just to give you some context around that. The office is very supportive of the green commitment, but as I said, the $65-per-square-foot allowance is not going to work.

Staffing and professional services. As you can imagine, staffing is one of the key things in our budget, and I thought I would just update you on something that occurred back in the start of 2013-14, which I'm sure you saw in the news. We revised our staffing model. When the previous Auditor General was leaving and Malcolm and I and Marc sat down with him, we took a look at the organizational structure and said: "We have eight assistant Auditors General in the office for an office of 115 people." It didn't make sense.

[1335]

So we went through, and we looked at the roles that we needed assistant Auditors General for. We assessed those roles and then placed the six people that were currently there in those roles.

It meant that we had to ask two people to leave. Unfortunately, that came out in the news as firings or something. It wasn't firings; it was a reorganization to take into account that we needed to save some money at the top in order to get the people on the ground to do the work that we needed.

We've managed to reduce our salary budget for the current year because of that. Even though we've replaced some at a lower level, the net savings is in salaries. It still allows us to operate at our 115 FTEs that we'd like going forward.

This year we're asking for approximately $11.9 million for salaries. Our salaries, as most excluded employees' in the province, have been frozen for quite a while. We've kept that for the same level going out, as well, for 2016-17. It might be that there is an increase at some point in the future. Say we were to get a 2 percent increase in the future, it would probably cost an additional $237,000. That's just to give you some context around the impact on salaries.

Our goal is to staff at 115. We're currently at 111, so we're pretty close. We do try and fill all those 115 positions, as we really do need them.

Professional services. It has increased over the prior year, and the reason that happened was one of the audits that we've done for a number of years is the WorkSafe B.C. audit. The fees for that are around $400,000. We've contracted that out this year to PwC. WorkSafe still wanted us to do the work, but we needed to utilize our staff in other areas and we thought it was probably time to contract it out. We have to pay PwC to do the audit because WorkSafe still wants us to sign the audit opinion. They highly regard us. So that's why you will see an increase in professional services.

We've managed to find savings of about $289,000 from other places in our budget submission to bring that down a little bit. The professional services budget didn't go up by the full $400,000. It only went up by about $111,000. So we have managed to find some savings.

Training staff, as I said, is an unavoidable expense. We have to do it. As I say, we're leveraging the best we can throughout the country to get the best training for our staff and to keep us up to snuff on all the standards that we're doing. I'm proud to say that in the last CPA exams, we had five out of six of our associates pass. So we have five new CPAs, which I think is a testament to the amount of training that we give them. Not only that — they're very bright too.

Travel costs remain unavoidable. While we try and do as much as we can in terms of going through video conferencing and whatnot, there are still a number of audit committees across the province where they really want us to be there in person. It is a much better way to do it — a little more expensive, but I find the personal touch much better than talking over the phone for two or three hours. So we still do have travel expenses, but as can be seen in the estimates, we have projected a decrease slightly in travel.

That's about all I have to say, other than I hope that we can get the recommendation from this committee for our budget and that if you have any questions around the move, I'm quite happy to answer those. We'll do our best in terms of keeping those costs as low as possible too.

D. Ashton (Chair): Thanks, Mr. Jones.

S. Hamilton: Gauging by the reaction of the people in the room, I'm going to guess you know what I'm going to bring up here, and that's the LEED certification issue. I'm finding more and more that it's costing a lot of green to be green, so to speak.

[1340]

I know achieving gold certification is incredibly expensive.
[ Page 632 ]
I think you said it was somewhere in the neighbourhood of over $300,000 or $400,000.

R. Jones: Correct.

S. Hamilton: In Delta we've always tried to achieve as close to a LEED standard as we possibly could without actually going for the certification. There are lots of things that can be done. But much like recycling in Metro Vancouver, if it costs you X number of dollars to get to 70 percent, to get to 80 percent is going to cost you twice as much. And LEED, sort of….

As we move forward, with all of the technology associated with putting our buildings together in as green a way as possible — everything from photo-grade glass that dims as the sun shines on it in the afternoon, that sort of thing — it gets very, very expensive. In these economic times I'd be remiss not to express my concerns about us putting too much money and trying to achieve the ultimate when we can get pretty close to that by spending significantly less. I just want to keep that in mind as we go forward.

Other than that, thank you for the presentation. I appreciate it.

R. Jones: Thank you, Member. I just wanted to say that one of the things in this new building is there is no room for parking of vehicles. So we're saving…. You know, we get some points for that. And of our 115 staff we have between 35 and 40 people that bike to work every day. We're doing our best to keep things green and so is the builder, I must admit. So I take your advice.

M. Farnworth (Deputy Chair): I'm going to follow up on that, but I’m going to phrase it in a slightly different way. And I don't mean this disrespectfully when I say it. That is, one of the roles of your office is to make sure that we're following policies, in your reports — that government ministries and the areas that you audit are in fact following the policies that are in place.

So I'm interested, in a sense, in this particular point. You're moving into a building that is for 20 years, which is a considerable length of time. And, in essence, it's almost as though we own the building — I would argue, with such a length of time — and yet government policy is that it will be gold LEED standard. So I'm not trying to be…. I would appreciate your thoughts on that, when that is the current government policy. If we want to change the policy, government should change the policy. But if that's the policy, how do you square that?

R. Jones: Thank you, Member. We did take a look at it because we thought if there's legislation that says, "You must have LEED gold standard," then we wouldn't have any choice. But we weren't able to find anything in legislation that said it was required. Everything we've read sort of says that it would be nice to get to that standard, and it's preferable. I think when government is building new buildings, they try and achieve that. So what we have tried to do is in the spirit of what government and, I think, everybody in the province would like to see, which is a greener economy.

We've tried to make sure that when we've talked to the builder and he's putting things in, that, without getting the certification, he's actually putting stuff in place that would get us close to it. Like, he's making sure that — this is probably a silly example — the toilets are the slow flush and all that sort of stuff, which you get some points for. He's putting in some greenery outside that gets you some more points because it's in an urban setting, putting the bike stuff in. There's an awful lot of stuff that I think we're getting.

I guess one of my questions was: do we really need to have it certified for $120,000? Or, if we're happy that we're getting most of that in place, is that good enough? We're trying to get as much of it as we can within the budget we've got.

M. Farnworth (Deputy Chair): And I understand that. It's just the point…. I do think we should try and get as much as we possibly can.

M. Hunt: I'm a fan of equivalencies, by the way. To me, the extra money just to have a piece of paper is an awfully expensive piece of paper. That's my opinion on that.

[1345]

We have a few challenges. I don't know if this is the right venue to ask it, but I'm going to ask it anyhow because we're dealing with budgets — and lots of them. For example, we just finished having, before you, the Conflict of Interest Commissioner's office in here, where we have a budget that fluctuates — so the wild anticipation of what's going to happen and the policies that we have for that.

While we were out during our tour of the province, one of the things we constantly heard from the university side of things was that they have money that they can't access because it's previous years' surpluses. I come from the municipal sector. In the municipal sector we are required every year to balance our budgets. We're not allowed deficits — all those sorts of things.

For my city, what we discovered is that over a year we find efficiencies during the year. As we find efficiencies during the year, we put into our budget at the beginning of the year an appropriation from previous years' surplus that becomes a part of us coming to zero. Our hope, and target, is that we don't use it, that we in fact end up with a surplus over that. That goes into a surplus account, which, when it gets too big, we use for other things.

We now have universities that have cash that they can't use. My question to you…. And at least in theory, our municipal auditors are going by PSAB and all the rest of
[ Page 633 ]
those acronyms and GAAP and you name it. They always throw those things at us to do all kinds of crazy stuff. How is it that we have different standards and, supposedly, the same standard bodies that we're conforming to, but we don't seem to conform in the same way?

R. Jones: I think you'd call it balanced-budget legislation. You know, that's really what it is. The standards have nothing to do whether or not a university can take a surplus and use it the next year. It's all about meeting the Budget Transparency Act and balanced-budget legislation.

M. Hunt: You're saying it's a legislative problem? I'm asking the question. I'm new at this job, and I'm trying to figure out what's going on.

R. Jones: What I put in, in my opinion on the public accounts — because we have a slight disagreement with the comptroller general around a certain standard right now that everybody across the country uses, except this province — was that the reason I get for why the comptroller general here doesn't want to put the standard in place is because it creates too much fluctuation and it makes it very difficult for budgeting and balanced budget.

The regulation that the government has put in place allows what we would call smoothing. It matches revenues and expenses so there are no fluctuations. What I pointed out in my opinion was…. The balanced-budget legislation is old. It's, like, 2002. Maybe it's time, because standards have changed quite a bit since 2002 — and I can't comment on policy — to take a relook at the legislation and just see if there are some sorts of performance measures or measures that could be put in place that would stay in step with the current standards, the way that they're out there right now.

You're right. We're doing a new report — this is like public accounts — right now around working capital management — cash that's trapped in universities, that's trapped in school districts, that's trapped in the health authorities. There's a lot of it out there. There are billions that can't be used because you can't take the surplus and use it in the current year to offset, to create a deficit. It's a bizarre situation.

M. Hunt: I'm glad to hear you say those words, because I'm trying to figure this out too. Thank you.

D. Ashton (Chair): Any other comments or questions?

E. Foster: I have two questions. The first one: when is the move anticipated?

R. Jones: We hope to be in next November.

E. Foster: On November 14?

R. Jones: Yeah. We have a contingency plan in place with the current owner in case that doesn't happen. If you look at that site right at the moment, there's not a whole lot there.

[1350]

E. Foster: It's lonely doing this out on the street.

So, then, the next question….

A Voice: Cold too.

E. Foster: Very cold, yeah. It's snowing.

This has to do with the LEEDs end of things. How much of the building are you going to occupy?

R. Jones: We are going to have, basically, well, three floors plus the basement, and there are going to be three commercial operations. I think it's three or four out front. He's going to keep three of the commercial operations that I think were there previously — or maybe new ones, but most of the building.

E. Foster: So 90 percent of it, then.

R. Jones: Ninety percent. Yeah.

E. Foster: Okay. The reason I asked that was if you're only going to use a third of the building, the LEED thing becomes an issue. To Mike's comments, it may not be in legislation, but it's certainly a policy that we've encouraged.

D. Ashton (Chair): Any other questions or comments?

Folks, thank you very much. We appreciate it.

Just a quick recess, and then we can go in camera for some discussions and deliberations.

The committee recessed from 1:51 p.m. to 1:53 p.m.

[D. Ashton in the chair.]

D. Ashton (Chair): Okay. If I can get a motion to go in camera, please?

The committee continued in camera from 1:53 p.m. to 2:20 p.m.

[D. Ashton in the chair.]

D. Ashton (Chair): And a motion to adjourn.

Motion approved.

The committee adjourned at 2:20 p.m.


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