The committee met at 9:30 a.m.

[P. Milobar in the chair.]

P. Milobar (Chair): Good morning, everyone. We’ll get started.

My name is Peter Milobar. I’m the MLA for Kamloops–​North Thompson and Chair of the Select Standing Committee on Public Accounts.

I’d like to acknowledge that we are meeting today on the traditional territories of the lək̓ʷəŋən-speaking people, now known as the Songhees and Esquimalt Nations.

We have two items on today’s agenda. The first will be a follow-up presentation on the status of the implementation of recommendations from the Auditor General’s report titled Oversight of Contracted Residential Services for Children and Youth in Care, released in June of 2019.

I’d also point out that this is our last official meeting with our Auditor General before he retires in mid-November. We now have an interim Auditor General that will take over in mid-November. Sheila Dodds, I believe, was named that interim Auditor General then. We’ll touch on that a bit more with Michael near the end of the meeting, but I did want to make that point at the beginning.

I’ll turn the meeting over at this point to the staff from the Ministry of Children and Family Development to begin their presentation, and then we’ll jump in with questions after your presentation.

Welcome.

Follow-up on Implementation
of Recommendations in
Auditor General Reports

Oversight of Contracted
Residential Services for
Children and Youth in Care

K. Godin: Okay. Thank you, Chair. My name is Keith Godin, acting deputy minister of Ministry of Children and Family Development.

I want to start by acknowledging as well, grateful to be on the traditional territory of the lək̓ʷəŋən-speaking people of the Songhees and Esquimalt First Nations.

Thank you to this committee for the opportunity to discuss the ministry’s progress on this critically important area of service and, more specifically, the audits of 2019’s recommendations.

I’m joined here today by a number of colleagues: assistant deputy minister Kelly Durand, assistant deputy minister Emily Horton, executive directors Dayna Long and America Blasco, and assistant deputy minister and execu­tive financial officer Fisnik Preniqi.

At the time of the Auditor General’s report in 2019, the world of contracted care was much like what was described. Contracts were being developed around individual children. Some contracts were pages long, with significant detail and defined outcomes, while others included an array of activities but little in the way of intended outcomes.

Contract values ranged from approximately $50,000 up to as high as $2 million, with seemingly comparable outcomes. Staffing levels and qualifications varied across areas, and to one of the Auditor’s key findings, there was no overall comprehensive strategy for how and when contracted care was used for children or what type of contracted care would be most suitable for their needs.

It is for these reasons the ministry at that time welcomed the report and continue to welcome the oversight today on this critically important area around child well-being and the provision of care, particularly for those in our care on behalf of government.

In a few minutes, my colleague ADM Kelly Durand will explain the work that has been done to respond to the specific recommendations of the Auditor General’s report. Before she does that, part of my job is to provide this committee a broader context of what is different today — that the recommendations and more so are on track, and we are confident that a higher level of care and accountability is being provided.

For instance, the ministry designed and received government approval for a full network of care that includes four service types, what we refer to as specialized homes and support services, to interact with one another to im­prove outcomes for children and youth and to ensure only those children who need longer-term placements in staffed care settings are placed in these homes.

We have introduced standardized contracts with prescribed processes, transparent criteria in accordance with the four types of individualized care placements. We have respite care. We have low-barrier short-term stabilization care, emergency care and long-term specialized care.

We have established expectations and performance standards for service providers as well as ministry staff working with those providers and children in these homes. We have built the IT systems, policies and reporting process to facilitate the monitoring of this system and effective oversight.

[9:35 a.m.]

We have done this work based on research in partnership with service providers, Indigenous child and family service agencies, Indigenous rights holders and Indi­genous communities and partners, and the voices and lived experience of children that have been in care, former youth in care, families, care providers, advocates and a number of experts.

What I would like to share with you today is this. Much like building a house, the foundation is essential for a successful build and generally is unseen and longer work than what most people see towards the end: the framing, the siding, the windows, and so on.

In MCFD, much the same. We have already built a foundation for this new, comprehensive system of contracted care and have way more progress and pace than what most people see. This is the heavy lifting work. Again, often the public cannot see and feel this work because not all services have shifted from the old to the new. But at the same time, it’s often the majority of effort required to make such a change.

We are now in full implementation mode, building on the years of foundational work we have put into place. We are doing this, of course, with extreme diligence and constant placement of child well-being and safety at the core of our implementation approach as we initiate a major project, because when services are intended for children and their families, unintended consequences can come up and must be carefully considered and mitigated in every single case.

We are ultimately on track to replace the 2019 system of contracted care with a specialized homes and support services system and the four service types by the end of 2025, with full implementation of monitoring and reporting in 2026. As with any systemic change of this size, we expect learnings along the way, and we have and will iterate and improve as we learn.

For example, we’ve already made adjustments based on our experiences in implementing this new approach in two early implementation areas that we started in 2022. Going forward, this could look like improvements to contracts and changes to policy.

Happening in parallel with this major initiative, and part of this broader context, some Indigenous governing bodies across the province are exercising their inherent right to jurisdiction over child and family services and, as such, may determine a model of service delivery for caring for Indigenous children.

There is a generational shift in the care for children in B.C. that is underway. The ministry’s collaborative work with Indigenous child and family service agencies, ICFSAs, continues as we look to support them in their development of a framework for care and determine how SHSS services can be delivered within that framework of care and in partnership.

I am confident, however, that the foundation of this change — a clear strategy in place, well-defined outcomes for children, IT systems in place, standardized contracts, performance expectations and systems that allow for effective monitoring and reporting — will serve children and families well across B.C.

Again, thank you for the invitation to update this committee. We welcome the accountability and continued guidance to provide one of the most important social services a government can provide.

I now invite my colleague ADM Kelly Durand to walk through in more detail the progress the ministry has made on the individual recommendations that were received by the OAG in 2019.

K. Durand: Thank you, Keith.

I trust that everyone has the slide deck or a version of the deck, and I can walk you through.

I’m going to start with the overview, slide 2, and just draw your attention. The ministry, as Keith indicated, previously accepted the four recommendations from the Office of the Auditor General and continues to actively implement on those recommendations. We were pleased to accept the recommendations. We felt that they were timely, and we’re actively in implementation stage.

The ministry has designed and is implementing on a large system of four contracted care service types. This is under the heading of specialized homes and support services, what we refer to, the acronym, as SHSS. You’ll hear that today many times.

The SHSS contracts include outcomes for children, standardized provisions and performance expectations as well as specific requirements for monitoring and reporting to approve accountability. SHSS has been fully implemented in two geographic areas, and implementation across the remainder of the province is underway. We expect that the four SHSS service types will be implemented by the end of 2025, with monitoring and reporting completed in the spring of 2026.

[9:40 a.m.]

In terms of recommendation 1, the ministry, in partnership with Indigenous child and family service agencies and Indigenous communities, creates, implements and communicates a strategy for contracted services.

In terms of actions to date, what we have done is, with partners, designed a strategy to ensure that children who need it are placed in staffed care homes. When placed, there is now oversight that is extensive, and planning occurs to address the well-being of children. We have worked with partners to address gaps that resulted in children being placed in contracted care unnecessarily and designed distinct contracted care service types to ensure appropriate placements that address the unique needs of children and youth.

We’ve indicated the four service types, as Keith mentioned: respite; low-barrier, short-term stabilization; emergency; and specialized long-term-care homes. There are key elements to the strategies. This is that we now have standardized contracts. We have standardized processes and policies so that service providers can access supplemental funding to ensure that the unique needs of children are met.

We have a performance management system that is built on measuring outcomes for children and youth. We have policies that now clarify the expectations for MCFD workers and for service providers. We have eligibility criteria, and we have enabled system operations. We have built and developed IMIT systems that support reporting outcomes for children and contract and agencies at the program level. And we’ve also developed a prequalified list of service providers who have a demonstrated ability to deliver SHSS services.

As you can imagine, the strategy is only as good as our ability to implement it. We are able to walk you through the foundational aspects of the strategy, which do include speaking to the standardized contracts.

Those include prescribed staff wages, training, planning tools for the children, the performance management system that we have built, the policies that clarify the expectations, the communication that happens with service providers, the IMT systems that now talk to each other. All of those things that we have built we are able to speak to, again thinking about all that has been designed and where we were at in the implementation stage.

Moving along to slide 4, this is in regards to recommendation No. 2 — that the ministry, in partnership with Indigenous child and family service agencies and Indigenous communities clarify roles and responsibilities related to policy development, information-sharing, communi­cation and monitoring for the delivery of contracted services. This is another important recommendation and one that the ministry has taken to heart.

Through engagement with Indigenous partners, rights and title holders, ICFSAs, we focused on designing policy that identifies clear roles and responsibilities. We underwent organizational realignment to ensure that we could meet this recommendation. Again, we developed IMIT systems to ensure that service providers and ministry staff were talking to each other. We developed a system called PCMS, a procurement and contract management system, and we made significant upgrades to our ICM system, a system that we already had in place.

We’ve completed numerous orientation and training sessions with our ICFSA partners. In the province, there are 25 ICFSAs. Those are Indigenous child and family service agencies. We’ve completed 24 out of 25 orientations with those ICFS agencies.

We have stood up an SHSS advisory committee. That’s a committee that works with service providers across the province so that MCFD staff actively works and engages with service providers across the province to learn from them, and we in turn provide learnings to them.

[9:45 a.m.]

We have created a service provider portal to ensure that the communication is back and forth, and we share reporting information. As of September 3, 59 legacy contracts have now transitioned over, and 24 net new.

I’ll draw your attention to slide 5, recommendation No. 3. Just being mindful of the committee, I want to provide an overview and then leave some time for Q and As. Recommendation No. 3 is that the ministry, in partnership with ICFSAs and Indigenous communities, establish a quality assurance framework for contracted services — again, another recommendation that we welcomed.

We have now established a quality assurance framework. This has been established. We are on track for full implementation of this framework. The accountability for this framework does not only flow one way. In fact, the SHSS system has resulted in changed accountabilities for social workers in terms of how we plan for children in SHSS homes, how we work with service providers, what we monitor and how we monitor. In fact, service providers monitor in a different way, and so does MCFD staff.

We have developed a reporting system of ten new reports. Three are now being used. For seven, we are waiting to input data. As we bring more service providers online, we test the system, make sure it’s doing what it is intended to do and that there’s model fidelity. That is where we’re at with the assurance framework. It is built, and we are testing.

In terms of recommendation No. 4, I’ll draw your attention to slide 6, that the ministry improve its management and oversight of contracts for contracted services, the backbone of SHSS. The ministry has made several improvements to the management and oversight of contracts for contracted services. There are a large number of contracts, with many vendors, that need to be transitioned to a new approach and a contracting system. It is important that we work with our service delivery partners and vendor agencies as we make this major transition.

By taking a measured approach, we’ve been able to implement enhancements to improve overall consistency through the introduction of standardized contracts with clear deliverables and outcomes. We’ve established a contract management transition team in the ministry that works closely with our service delivery staff to provide a consistent, stable and sustainable approach to contract management, updated documentation for roles and responsibilities for SHSS staff, working and contracting to deliver a new service model and identifying opportunity for improvement and clarity.

We’ve developed training modules for service providers and for SHSS staff. We’ve developed guidebooks and made them available, and we’ve kept them regularly updated. We’ve developed a service portal, as I’ve mentioned, for service providers, for contract reporting.

This team that I mentioned, the contract management team, has been working with SHSS in two early implementation areas to support contract negotiations, the contract deliverables and outcome analysis, to ensure that payments are occurring regularly and that there are no issues.

As of September 3, as I mentioned, 59 contracts have been transitioned from the previous contract model to new SHSS, and 24 net new contracts have been brought on board. Some 26 of the current 83 service providers in the province are delivering at least one SHSS contract. As of the fiscal year 2025, financial audits are occurring by the new financial audit and assurance team that has been stood up. Twelve audits are on track to be completed this year.

We also have a new IMIT system that supports SHSS contracts and is focused on centralizing contract data and reporting, including the service provider portal. It now provides transparency on payment processing, resource planning and tracking. All of this is helping us to deliver on recommendation No. 4 of the Auditor General’s report, to improve management and oversight for contracted services.

[9:50 a.m.]

I draw your attention to slide 7 and offer that, in summary, the ministry is on track to implement the OAG’s four recommendations. Major system changes have been made, including new contracts, reporting and performance requirements, IMIT investments to support standardized entry and tracking, and increased accountability measures, such as expanded financial audits.

All of the foundational aspects are in place to finalize provincial rollout of the four SHSS service types by the end of 2025, with full implementation of monitoring and reporting in 2026. The ministry is fully committed to the implementation of SHSS and welcomes ongoing oversight, as there is no greater imperative than supporting children and youth and families in British Columbia that have been entrusted to government care.

P. Milobar (Chair): Thank you very much, both of you, for that presentation.

Questions from the committee?

S. Chant: Thank you very much for your presentation, and well done on all the amazing hard work. That’s a lot of things.

I actually have several questions, Chair, so I’ll start with one and back-to-back them if that’s okay, or move on.

P. Milobar (Chair): Not a problem.

S. Chant: The first question is around the respite component. Is the respite being looked at as, first of all, both in-home and out-of-home?

Secondly, are we looking at having it regional, or how are we looking at having it? I know, from my background, that respite has been very hard to achieve for some families and for some kids. I’m just wondering what is being done in the area of respite to make it more accessible.

E. Horton: Thank you for the question.

This specialized home and support service respite exists within really a continuum of respite supports. That includes respite that’s provided directly to families — for example, families with children with support needs. This respite provides a very specialized, high-quality environment for children that cannot be accommodated within the home respite.

The idea here is that we want every community in B.C. to be able to have a mix of the four service types, including the respite. The goal is that this kind of specialized respite is available in all communities across B.C.

S. Chant: All right. Nice.

Are you on electronic records for the actual kids?

D. Long: Yes. Between both our systems, we use our integrated case management, ICM, for an electronic record for any data or information related to children and youth specifically.

S. Chant: Okay. Thank you.

I had another one, but I decided not to….

P. Milobar (Chair): Okay. Well, we may come back to you, if experience says anything.

Jackie.

J. Tegart: Thank you for the overview.

I guess, as someone who has served on the committee and taken a look at Auditor General reports and recommendations, this is one that is very, very important. The work you do is very important. But to think that from 2019, we get a report that says none of the recommendations have been completed…. We also see situations where the systems have failed children.

Part of our job is to make sure that we minimize the stories we see and the ones we hear in our communities, where children have died, have been in situations that none of us would wish them to be in. I can’t imagine what staff feel like.

As I hear about the work being done and the analogy of building a foundation for a house, how do you put the heart in it? How do we all put the heart in it to ensure that children who come into government care are being monitored, that the services are not assumed to be there? Our safety net is you.

[9:55 a.m.]

To read the latest situation was heartrending for everybody. What did we learn, and what in these recommendations and the response to them will help us never have to read another court document that read like that one did?

K. Durand: If I may, Jackie, I’m going to pass you over to Emily. I’m going to ask her to talk a little bit about the design of SHSS and take you back to what we were thinking about as a ministry as we designed it, and then I’m going to finish off.

We have different roles as assistant deputy ministers. I’m going to finish off, if I could.

E. Horton: Thank you for the comments and the question. I think that while we do sit here and we talk about contracts and performance metrics and IMIT systems, really the call to action that we really took from this 2019 report was about the safety of children.

The core of this work is ensuring that the children that are in these homes are safer than they were in 2019. Some of the ways, the checks and balances beyond contracts and beyond performance metrics, were around ensuring things such as expanding the circle of accountability that had eyes on a child.

In 2019, children were in contracted care, and they were under the care of service providers. While they had a guardianship worker and a care plan, the processes were not necessarily integrated. Today what we have is a re­quirement that every child in contracted care is supported by a circle of care and a circle of accountability, which includes the voice of the child, somebody appointed by the child in that circle, numerous professionals, the day-to-day caregivers and ministry staff.

The idea here is that we don’t want a single person planning for a child. We want a group of people with different lenses coming together and saying: “What does this child need, to either mitigate a crisis or to support their day-to-day well-being?” The intention of that circle is to meet regularly and to make sure we’re going beyond making sure a child is clothed and safe to making sure their well-being, their cultural attachment, their happiness is planned for and monitored in a very prescribed but individual way.

Some of these processes, going back to the foundation, are really core to this model and embedded in every aspect of this. So as we move towards taking all of our contracted care facilities that exist today and moving them over into this specialized homes and support services model, we can assure that circle of accountability is wrapped around every child.

K. Durand: Thank you for the question, and thank you for the heart part of the question.

Emily’s role in the ministry is policy and legislation, and that’s why she speaks around build and design. My role in the ministry is service delivery, so I’m responsible for close to 170 offices, 4,000 staff, social workers, caregivers, some elements of practice.

One of the things that was introduced into the care homes a few years ago was the concept of love. It wasn’t something that was familiar to our vernacular. We didn’t talk about that. We didn’t talk about: when children came into care, how do we try to provide love? It wasn’t that it was absent; it just wasn’t something that we spoke about.

It’s especially difficult when we think about contracted care. One of the things that’s interesting is that underpinning the new model is a rooting in the consistency of contracts. We can get lost in talking about that, because what we’re really talking about is outcomes for children.

[10:00 a.m.]

We’re talking about the RCY’s Don’t Look Away report that helped inform us being here. We’re talking about the stories and the tragedies that you’re referring to and how we do better. We’re talking about families that trust us — that when children come into care, they know and have the confidence that their children will be safe.

We’re not just building a system of contracted care; we’re building a system across the province, so that in every community that we serve, for all British Columbians, it will look consistent, it will be responsive, and it will meet the needs of children and youth and families — and that you trust us, that you have confidence we’re building a system of good, safe care.

It has taken time, and we’ve adjusted. As Keith mentioned, it’s so vitally important that we get it right. We’ve put our hearts into it. This team has put their hearts into it. The people you can’t see here today and who are watching have put their hearts into it, because we want to get it right. When we say that we welcomed the recommendations, we welcomed the recommendations. We know we can do better. We will do better.

Thank you for that question.

S. Chandra Herbert: I’m looking at the timelines from initial report to where we are today. I’m wondering how long typical contracts are. I know it’s easy to say, “You’ve got to change these contracts,” but if you’re in a three- or a five-year or whatever length contract, that can be difficult to work through with the person you’re contracted with.

It also…. It’s good to have that stability, but it can also mean that you’re not agile. I’m just curious how you manage that within the contracts.

D. Long: Thank you for that. One of the key pieces of work, as we were looking at developing this model of contracting support to the model of care with SHSS, is exactly that question, around: how will we ensure the stability of children and youth placements in current contracts with current service providers to move into this new model?

A lot of work was done to get an exception from the comptroller general to be able to transition and work with the current service providers, to move them directly from their current contract into an SHSS contract. We use the term “legacy contract service provider,” moving into the new contract. Kelly was referring to those that have already transitioned over. Those represent service providers who were in our current contracting model that have moved over to SHSS through that process.

In partnership with our service delivery division and our contract management transition team, we work, along­side with the service provider, to move and transition their contract from the current model to SHSS, with the priority of ensuring that it does not negatively impact or destabilize children and youth in their care.

R. Leonard: Well, thank you very much for that very comprehensive report to us on the work that has been done on the recommendations.

I know that we’ve heard from the Auditor General about that relationship, and that there’s a good working relationship, so that you guys understand what they’re looking at. I mean, it has been a good relationship, and it’s obvious that as you say, your heart is in this work.

One of the things we’ve heard at this table is that nothing is complete. That has, I think, been mitigated today by your presentation to show what has been done. I think what might help, as well, is to say that although this is a long time coming, things have changed on the ground. I’m wondering if you can describe how it looks for kids that are living in these circumstances now — that we’re not waiting six years for anything to change for those kids today.

[10:05 a.m.]

D. Long: Thank you for that. When we think about the lived experience of children and youth in our contracted homes, it’s important to think about their lived experience even before coming into care and to think about the vulnerabilities and trauma impacts of many of these children and youth that come into care.

Often they’re coming into contracted staff homes because of either gaps in our family care home or an unfortunate breakdown of a familial or family care home arrangement. They come into these resources with a significant trauma history, many vulnerabilities and a need to support them in a good way.

Our current model was exactly as what was indicated in the original audit report. What we’re really working towards and what we’re starting to see as we transition care into SHSS is the importance of knowing that there’s consistency, right from staff qualifications to who is hired, who is able to provide care, what the expectations of service providers are, so that children and youth in every home can expect the same quality of care and receive the same quality of care, and there’s not that variability.

There has been lots of work in design and research to really look at what the indicators of good quality care and good outcomes for children and youth are. The reporting and metrics that have been developed into the contracting system are tailored to tell that story with opportunities of regularly reporting a child’s or youth’s voice to ensure that there’s responsiveness to changing or shifting the plan if there’s a need to do that and, as Emily spoke about, ensuring that they know they have a full circle of care there, wrapped around them, to provide those supports and to be able to look at that.

In addition, one of the things we know about the children and youth in care is they’ve been challenged to be able to access the types of supports that really are the necessary interventions, even above and beyond who’s caring for them and what their resource is. The new SHSS model provides an opportunity to access supplemental funding that’s built right into the contract to be able to add additional supports into their care arrangement that will meet their unique needs, based on their service plan, to be able to enhance and wrap around them further.

While we are still building and implementing, our hope is that through the monitoring quality assurance a year from now, two years from now, we’ll start to see very different outcomes and hear different voices and different views from children and youth that have been in care.

R. Leonard: What I’m hearing is that things are happening and that changes are on the ground.

D. Long: Changes are absolutely happening, both within SHSS and beyond, for sure.

R. Leonard: Okay, thanks.

When I look at all the work that’s being done, I assume that this is new work. How much extra load has that been, to make those changes? You’re not just keeping the system going; you’re changing the system. What would happen if we saw the ability to keep moving forward be impaired? Where would we be if the resources weren’t there for you to continue with this change?

K. Godin: Thank you for the question — ultimately, a resource and funding question. I’m happy to provide a response to that. We’re so far down the path of implementing this project that we’re quite confident that we can implement it through 2025 and 2026. Although I used a transportation metaphor, it is somewhat fitting, in that all the foundational pieces are in place. The standardized contracts, the IT systems are already there. We are in implementation mode of on-the-ground, in-service delivery areas, transitioning from contract A to contract B.

We also have a budget, loaded from previous budgets, to enable us to do the work while we maintain the existing service of care and add this additional workload on top. We’re fully resourced for that.

P. Milobar (Chair): Just one question, I guess. Well, I have a couple, but I’ll stick to this one for the time being.

There’s the transition; there’s contract A to contract B and all of that. But as we see across all forms of services out there…. In my case, in Kamloops, we have a daycare that has just had challenges with licensing in terms of ECEs, appropriateness and things of that nature.

All the contracts, all the processes, all of that changing is all great. What has changed on the monitoring side to make sure that contractors actually have appropriate engagement and appropriate staff and that gaps aren’t still being created on the contract side?

[10:10 a.m.]

What has happened at a ministerial level over the last few years, if at all, to make changes to that oversight piece? That seems to be where things sometimes, unfortunately, go off the rails. All the processes are in place, but if the person implementing within that contract isn’t meeting standards…. What does that look like now and moving forward?

D. Long: Thank you for that question. There has been significant work to not just develop the contract, the policy and the processes but also our organizational structure — to develop the capacity to do all those things which you’re speaking to. The essential element of our new contract templates, with the clearly defined outcomes that allow us to be able to monitor them through the integrated IMIT system, is just the starting point.

The clarity of roles and responsibility, both for service providers and for ministry staff, allows us to be certain who is responsible for monitoring which piece of information. Essential to that was also the ministry looking at how we build the right people with the right expertise to do that monitoring. Some of the pieces that have been added are really that ability to look at who’s monitoring the financial pieces, the contract deliverables, the quality of care and the day-to-day safety and well-being for children and youth.

With that is some building of specific teams that are dedicated to be able to do that. That includes, from financial, adding a financial audit and assurance team that will be looking at ensuring that the financials and the use of the funding provided in the contracts are consistent as laid out.

As well, the contract management and monitoring transition team comes with the subject-matter expertise specifically to support contract negotiations, contract monitoring and oversight of the deliverables, and is able to support and flag, for service delivery, who ultimately has an input and a dependency on the outcome and the deliverables of that contract, as far as quality of care, to be able to work in collaboration to make sure those are met.

This allows for resource workers, social workers, that have specific responsibilities to ensure that the service provider, through relational practice, is consistent with policy and quality of care — to focus on that, as opposed to contract management — and that those staff who are primary professionals, usually those with guardianship responsibilities, really focus on the needs of children and youth, their day-to-day care and safety.

There has been an organizational shift, which is quite significant, and specific resourcing, to be really able to live out the monitoring that these contracts deserve because the youth really deserve for us to be sure that the intended outcomes are being met.

S. Chandra Herbert: It relates, I think. Sometimes in politics we say, “We’ve got to lay this person off due to that, and it’s redundancy, etc. We’ve got to be efficient, etc.,” but I find that sometimes with children and youth, you do need a level of redundancy. If somebody is sick, there still has to be somebody to look after the kid. There still has to be somebody who does that safety check.

What level of…? I don’t know if “redundancy” is the right word, because they’re not redundant. They are necessary, but they’re the backstop. Maybe backstop is a better form. What sort of backstop do you have to these contracts? Maybe it’s what the Chair was talking about. Is there a team that goes in and does kind of a surprise visit? Or: “Let’s check. Do they actually do the criminal record checks.” What kind of level?

I know you have to have trust in your partners, and you don’t want to be that micromanager. At the same time, in the end, the buck stops with us, as the ultimate caregiver for these young people, even if we’ve contracted that care out. I’m just curious what extra level of eyes appear. It’s not just a check in the box: “Oh, the boxes were checked. We can move along.”

D. Long: I’m happy to provide some additional information around that. I think one of the key pieces for us is around team-based practice. It’s not just an individual with these responsibilities, but it’s full teams. If one individual is away unexpectedly, then someone from the team manages that.

Beyond that, there are exactly those types of things that you’re talking about, from financial audits that could occur on an as-selected or as-needed basis, but most important is the role around the resource worker who has both the expectation and the accountability to do those on-site visits on a regular basis, both as planned and unplanned.

[10:15 a.m.]

At any time, within those roles and responsibilities within ministry staff, we would look in and pull reports through the data management systems, reviewing those by analytic support, being able to do that. That would happen at a front-line level, at a team-leader level, a director-of-operations level.

In addition to our ministry team, there’s also an associate provincial director of child welfare role with their child safety and oversight and practice development team. That really is being built up to provide additional systemic oversight for children and youth in care as well as all the practices within the ministry.

J. Tegart: Just a follow-up. Having spent many years on school board, with many years of frustration on the inability to share information, I’m wondering. In the model, teachers are on the ground, and they see the kids most every day. What is the partnership with other people who actually serve our kids? Perhaps I’ve an insight that is different and can add to the quality of care for children.

E. Horton: Thank you for that question and comment. You’ve highlighted a very, very important point: that it takes many voices and many people from different points of view to adequately support the well-being of a child.

Information-sharing and interagency collaboration is absolutely a priority for the ministry, and supporting that in any way possible. Right now the way that that is facili­tated for the children in specialized homes and support services is really through that circle of care and the circle of accountability.

It would not be unexpected to have a teacher invited to such a circle or to have a mental health clinician invited to the circle to think about, “You know, this individual needs this in the home, but this is how it’s looking in the classroom,” and really thinking about that planning together. Acknowledging that kind of collaboration is always an area that we can build from and improve on.

P. Milobar (Chair): Around resources and funding levels, and it was touched on, I noticed that it looks like the budget went up by a couple hundred million dollars for Children and Family Development this current fiscal, but then it flatlines for the next couple of years. How concerning is that?

K. Godin: Thanks for the question. The way the budget structures generally work under the fiscal plan is that things are uploaded with actuals into the year of the budget and then generally flatlined over the period of the fiscal plan.

We are ultimately needs-based delivery. So we fund the needs of every child that’s in care. In addition to that, we have project resources to enable implementation of the recommendations in this initiative.

P. Milobar (Chair): Looking back to the respite question, I noticed in the answer, and I appreciate the answer, that the goal is to have it available in every community in the province. I’m willing to bet that my definition of a community is different than the ministry’s definition of a community, which will be different than everyone else’s definition.

What is the ministry’s view of what would constitute a community under that goal, given the remoteness and rural nature of the province?

E. Horton: Thank you for the question. I’m not going to make a defining statement of what “community” is. I’m going to share with you what my intention was when I said that.

The ministry, of course, is organized by service delivery areas, which are then further broken down into local service areas. What we’re thinking about there is that in each local service area — my colleagues here can describe how many local service areas there are in the province — we would want that network of those four services to be available.

The number of local service areas…. We will have to return to you with that number, but that was my working definition.

[10:20 a.m.]

P. Milobar (Chair): Okay. Thank you.

Any other questions?

S. Chant: I’m just wondering. I heard that the work is being piloted in two regions. Are you able to tell me how many regions there are total?

D. Long: There are seven service delivery areas. The early implementation in those two service areas is completed, and we’ve begun rollout into the next two.

J. Tegart: Just a word of encouragement. I’m 17 years on school board, and I talked to the superintendent of schools and said: “This is my greatest frustration as I leave. How could we have made the change?” And he said: “Well, it’s like trying to steer the Titanic.”

The work being done is impressive. I’m glad that we were able to bring you here to hear the work that’s being done, because often paper does not tell us that. I’m very pleased to hear the enthusiasm of the response to the recommendations, because so often we can get stuck in systems and not realize that they’re not serving the very people that we serve. To change a system is like steering the Titanic. So I wish you well, and our kids are depending on you. Thank you.

S. Chandra Herbert: I would say I would much prefer if they were steering the Coastal Renaissance than the Titanic, so maybe we’ll just shift that metaphor a little bit.

P. Milobar (Chair): Sorry. I actually have one more — I’m starting to feel like Colombo here — just on the finance side. I was quickly scanning back to a couple of years ago, the budget. Obviously, this goes back to 2019 and the report we’re discussing today. The budget, historically, over those years leading up to where we are today, does start to impact. When I go back a couple of years’ worth of budgets, it looks like….

I’m assuming, as a ministry, a very HR-, cost-focused ministry, in terms of any increase due to collective agreements and things of that nature, a large portion of any uplift, any year, would be taken up by just contractual obligations to meet payroll. So if you start subtracting that out, it doesn’t look like significant net new dollars for expanded access have been flowing in.

How problematic has that been to maybe have things more advanced than they are now, given we’re talking…? We’re already five years into….

I appreciate you can only do what you can do on the timelines you can do with the resources you have access to. I guess, what does this look like, moving forward? When you really factor out those cost-of-living increases on wage settlements and things of that nature, in certain ministries where a large portion of their spend is on the human side of the equation….

It’s not like contracting the Ministry of Transportation, say, with a project. It’s a large portion there. So when you see a lift, it might look like a big number until you actually start figuring out what the actual payroll is and how much that was going to have to increase anyways. How has that played into it from 2019 till now?

K. Godin: Thank you for the question.

Through all of our budget processes and through release of materials through budget, we’re hyper-transparent on all the breakdown of our eight voted appropriations, and generally, all of them have increased over the last number of years. They’re also all inclusive of the wage mandate increases, both for the ministry staff as well as for the contracted, as well as for non-union, which are all included into our budget allocations and appropriations.

We can show you, in addition to that, that there are absolutely net lifts to the provision of services across all the voted appropriations, including this one, which is for children in care, both the services that are provided by the ministry as well as contracted care. We’d be happy to provide that breakdown, but it is a mix of both.

S. Chandra Herbert: It surprises me how the reduction in youth in care…. Even if….

[10:25 a.m.]

I know the budget has grown, but the actual number of youth that you’re serving has dropped considerably. I think it was 10,000 in 2001, and we’re now looking more at 4,800. So it obviously needs change. Some need more care; some need less. But it’s really remarkable to consider that the budget has gone up but the actual youth you’re serving have….

There are fewer of them. I would assume that means that that’s partly where you get the resources to increase program spending to get more services to young people when they need it. Is that fair?

D. Long: I’m happy to start. One comment from a policy side of things is children that are in care today are far more complex than they were in 2001, so the needs of an individual child in that 4,000 are…. It’s hard to compare to a child in care in 2001.

Additionally, of course, the ministry has alternative-to-care arrangements that are also funded, including kinship care. There are different care arrangements and ways to support, and an increasing complexity of care. That was what I was going to add.

P. Milobar (Chair): Okay. I think we might be done with questions.

Thank you very much. We’ll take a few minutes’ break just to switch around staff for the next presentation.

The committee recessed from 10:26 a.m. to 10:32 a.m.

[P. Milobar in the chair.]

P. Milobar (Chair): Okay, we will pick back up the meeting here. Our next report is the consideration of the Office of the Auditor General report, Final Report on the Examination of MNP’s Administration of the Advanced Research and Commercialization Grant Program, from August of 2024.

For one last time, we turn it over to our Auditor Gen­eral, Michael.

Consideration of
Auditor General Reports  

Final Report on the Examination
of MNP’s Administration of the 
Advanced Research and
Commercialization Grant Program

M. Pickup: Thank you, Chair. It’s good to be here with you this morning to talk about our final report on the MNP examination.

Let me start by acknowledging with respect that at the Office of the Auditor General of British Columbia, we conduct our work on Coast Salish territories.

As a Status Indian member myself, of the Miawpukek First Nation, I’m delighted to be a visitor on these lands, and I’m honoured to be with you today.

I’m joined today by Laura Hatt, assistant Auditor General — responsible for the entire performance audit portfolio, as you know — and two key members of our examination team, Laura Pierce and Janice Dowson. They do tremendous work to produce a clear and focused report for the members of the Legislative Assembly.

Let’s be clear. This was an unusual and demanding task. Given the timelines, the examination focused on areas of greatest risk. The team reviewed scores of evidence from multiple sources, ensuring that our findings were well supported. This included applications, proposals, scoring workbooks and decisions. They also reached out to all 99 program applicants and heard back from over 70 percent. Finally, they reperformed aspects of the screening process, reviewed over 5,000 emails — yes, that’s not a typo, 5,000 emails — and interviewed ministry staff, MNP representatives and relevant third parties.

We conducted this work, of course, independently. As you recall in the interim report, we confirmed that we are independent with respect to any business or other relationships with MNP. We reaffirmed this independence in the final report. I will assure you that our internal systems of quality management and the Auditor General Act ensure that we are non-partisan, objective and in full compliance with our professional and ethical responsibilities on this matter.

It should be noted as well that delivering this report, of course, has had an impact on the rest of our work, which I will leave to the future Auditor General, Sheila Dodds, in her acting role as that becomes clearer into the future. We have juggled assignments and schedules over the summer period. However, our staff work as a high-performing, cohesive team, and this allowed us to be flexible and adaptable.

I would just add that while it is rare for an audit office to receive a request like this from the House, we look upon it with pride.

[10:35 a.m.]

We’re quite pleased to be able to do this to meet your demand. We recognize the trust that you placed in us, and we got the job done with diligence and clear detail.

I’ll now hand it over to Laura Pierce for a summary of our examination.

L. Pierce: Thank you, Michael.

Good morning, Chair. Good morning, committee members.

I will now provide a summary of our final report. On April 8, 2024, the Legislative Assembly directed by reso­lution that the Auditor General undertake an examination of grants administered by MNP under the advanced research and commercialization program, or ARC, and the commercial vehicle innovation challenge, or CVIC. The resolution further directed the Auditor General to make public a final report by September 1, 2024. The report we are discussing today satisfies that component of the resolution and concludes our work on this examination.

I’m going to start by outlining the examination approach and the allegations that informed our questions, and I will then go through our findings in relation to these questions and conclude with a discussion about perceived versus actual conflicts of interest. Given the timelines prescribed in the resolution, we chose to focus our work on the allegations that led to the resolution. We did that by breaking the allegations down into discrete parts, and we examined them through four questions.

The first allegation was that MNP was writing government grant applications for grant programs it administers in exchange for a 20 percent success fee. The allegation furthered that MNP was then approving grants in their client’s favour for the 20 percent fee. We examined this allegation through our first two examination questions, the first being, “Did MNP provide applicant advising services — e.g., grant writing — for ARC or CVIC applications?” and two: “Did MNP influence the ARC or CVIC evaluation process to promote its clients?”

For question 1, we found no evidence that MNP wrote any ARC or CVIC grant applications for any clients, including company A that raised the allegations. Of the 71 applicants who responded to us, none reported that MNP had written their ARC or CVIC applications. We also looked at all the engagement letters that MNP had signed for grant writing services and confirmed that these applied to grant programs that MNP did not administer.

For question 2, we found no evidence that MNP influenced the ARC or CVIC evaluation process to promote its clients. MNP was not responsible for scoring proposals or making funding decisions. This reduced the risk that MNP could influence evaluations to promote its clients. We then reviewed documentation for all decision points and confirmed that the ministry provided final approval.

When it came to company A, it was the technical review panel, which MNP was not a member of, that scored company A’s CVIC proposal below the success threshold. The ministry rejected company A’s CVIC proposal based on the panel’s recommendation. Company A’s ARC proposal is currently among 20 other proposals waiting a final decision.

I’ll now shift to the second allegation, how we examined it and what we found. This allegation suggested that MNP was able to turn down grants and then use that as leverage to get unsuccessful applicants to sign up for grant writing services. We examined this allegation through our third question, which asked: “Did MNP use ARC or CVIC information to solicit clients for MNP’s business services, such as applicant advising, assurance or accounting?”

For this question, we found no evidence that MNP used ARC or CVIC information to solicit clients for its business services, including grant writing. MNP had policies to prevent information-sharing, and we found no evidence of widespread contact between MNP and ARC or CVIC applicants. For the three applicants who had been approached by MNP about grant writing services, we found no evidence that they’d been contacted using ARC or CVIC information.

We looked at all correspondence in MNP’s ARC program email account, which Michael already noted included more than 5,200 messages, and we did not find any evidence that the MNP grant administration team attempted to solicit business for MNP’s other services.

The final allegation was that the Ministry of Energy, Mines and Low Carbon Innovation allowed MNP to engage in the alleged activities and operate a kickback scheme. We examined this allegation through our fourth question, which asked: “Did the ministry identify and manage conflicts of interest in MNP’s administration of the ARC program?”

For this question 4, we found evidence that the ministry did work to identify whether there was a conflict of interest to manage by inquiring with MNP when the alle­gations arose.

[10:40 a.m.]

To summarize, our examination found no evidence to support the allegations.

Before I turn back to Michael, I’d like to highlight some differences between actual conflicts of interest and perceived conflicts of interest. As outlined in our report, actual conflicts of interest exist when someone is in a position where they could be influenced by conflicting interests.

In this instance, MNP team members were not in positions where they could be influenced by conflicting interests because, for starters, MNP staff members did not write ARC or civic applications, and MNP staff members did not decide who received ARC or civic grants. MNP staff members were not in a position to be influenced by conflicting interests because they were the program administrators.

Perceived conflicts of interest arise when to a reasonable observer with all relevant facts, it appears that someone is in a position where they are being influenced by conflicting interests, regardless of whether an actual conflict exists.

In this case, a reasonable observer with all relevant facts about MNP’s administration of the ARC program would be unlikely to perceive a conflict of interest. However, ARC and civic applicants did not have all relevant facts and information. Specifically, ARC and civic applicants were not informed that MNP did not make funding decisions.

With that, I will turn it back to Michael.

M. Pickup: Thank you, Laura.

A big thank you, of course, to her and Janice and all the team who did remarkable work over the summer and managed to smile and be enjoyable at the same time. I do appreciate that.

I don’t have a lot more to add, except to say quickly that this report marks my 40th and last as B.C.’s Auditor Gen­eral and my 100th report as an Auditor General in Canada, thanks to my 60 reports in Nova Scotia. I don’t think we need to be an accountant to go 100 divided by ten is pretty much ten a year over the last decade.

I’ve enjoyed my engagement with this committee since my appointment in 2020. I appreciate the trust that you have put in me and my office and the dialogue we have had throughout my time here discussing our reports. I wish you all the best, whichever way your paths may lead in the coming days.

That concludes our presentation, Chair. The team and I would be happy to take questions.

P. Milobar (Chair): Great.

Anything from our comptroller general before we jump into questions?

N. Wright: Thank you, Chair.

Good morning. We actually have a couple of witnesses with us today to help answer questions. Charles Mutanda is the executive director for the corporate compliance and controls monitoring branch for OCG. Charles was our lead on this file. We also have Nat Gosman, who’s the ADM for the program administration at EMLI, and James Donald, the executive director.

Before we go to questions, I just wanted to state that on April 10, 2024, I received direction from Treasury Board to also undertake a review and compliance assessment, under the authority of the FAA, of the CleanBC go electric advanced commercialization and research or ARC program and the commercial vehicle innovation challenge programs delivered by the third party on behalf of the Ministry of Energy, Mines and Low Carbon Innovation.

OCG undertook an approach to ensure that concern raised was addressed in a comprehensive, objective, fair and timely way. Our review was independent from the Office of the Auditor General review, and our findings were presented to the Office of the Auditor General on June 10. We also provided a report back to Treasury Board on the same day.

At this time, my office has completed its work on this file, and we agree with the findings of the Office of the Auditor General. Our findings are in alignment.

Happy to take questions.

P. Milobar (Chair): Okay. Thank you.

Questions.

R. Leonard: Thank you very much for that, and thank you, Michael, for your service to this province and to folks that you’ve served over the years as well. I really appreciate that you end on a nice even note. We like things that are divisible by tens.

[10:45 a.m.]

Just one question. This whole issue goes to the heart of whether or not businesses and people can trust government in its exercise of providing programs, and the issue of conflict of interest is really that response to the question of trust.

The one comment that I heard was around perception of conflict of interest, which is key to any politician when they’re making decisions. But for people, that’s probably the greyest area for understanding and building trust. The comment you made was that applicants weren’t told that MNP was not in a position to be making decisions. I’m wondering if that could have been anticipated as something that should have been communicated to applicants.

Also, then, the question that comes up is: how do programs, when they’re being administered…? How do you assure the public that there is that kind of oversight? We just spent an hour earlier today talking about oversight for contracted services for children and youth, so that’s sort of on my mind.

I hope I haven’t complicated things by nattering on.

N. Wright: I’m happy to start a response. If anybody has anything else to add, that’s fine.

That’s one of the reasons my office was also involved in an overview of the program itself, to ensure that the compliance on the ministry side was done in accordance with policy, because I think these instances help us make improvements. We can always do better, but I think having good policy in these areas when we design programs is important.

A couple of recommendations did come out regarding policy for my office to take back and implement across government. It’s based on that area of perception when there is a third-party provider that also provides other business services.

We can do a bit better of a job clarifying things that will reduce the inherent risk of perceived conflict of interest — things like making sure we’ve got well-documented segregation, fully segregated processes that are outside the influence of the administrator, like the decision-making process. Making sure that’s well-documented and communicated is one of those recommendations to make sure that we don’t see something like this, or we try to minimize this as best we can in the future.

P. Milobar (Chair): Any other questions? No.

I think it’s because everything was very cut and dry on the determinations here. We really just did all this so Michael could have a 100th audit to retire on.

You discovered the whole process was around that.

Okay. Seeing no other questions, then, I don’t think there’s any other business anyone has.

One final thank you to Michael.

It’s been great working with you, as a committee. You’ve seen a lot of different committee members in your time here come and go, so it’s always a bit of an evolution. Certainly, I think a lot of the changes that we undertook as a committee, with your help and guidance, to streamline things and get things a bit more effective for everybody has been very beneficial and will be moving forward.

Thank you again for your service to British Columbia and your overall career to bringing transparency across the country when it comes to public accounts. Thank you very much for that.

With that, I think we will adjourn the meeting.

Motion to adjourn.

Motion approved.

The committee adjourned at 10:49 a.m.