THE STANDING COMMITTEE ON INTERNAL ECONOMY, BUDGETS AND ADMINISTRATION
EVIDENCE
OTTAWA, Thursday, July 23, 2020
The Standing Committee on Internal Economy, Budgets and Administration met by videoconference this day at 10 a.m. [ET], pursuant to rule 12-7(1), in consideration of financial and administrative matters; and, in camera, pursuant to rule 12-7(1), in consideration of financial and administrative matters.
Senator Sabi Marwah (Chair) in the chair.
[English]
The Chair: Good morning. My name is Sabi Marwah, I’m a senator from Ontario and I have the privilege to chair the Standing Senate Committee on Internal Economy, Budgets and Administration.
Today we will be conducting a virtual meeting that will start in public, and the second portion of the meeting will be in camera. Before we begin, I would like to remind colleagues of the best practices for a successful meeting.
Please keep your microphone muted at all times unless recognized by name to speak. Senators are responsible for turning their microphones on and off during the debate. When speaking, please speak slowly and clearly into your microphone.
Interpretation in this video conference will work very much like in a regular committee meeting. You have the choice at the bottom of your screen of either English or French or no simultaneous translation. It is important that members speak in the language that they’ve chosen to listen to. If you do an intervention in English, you must select the English channel. If you do an intervention in French, you must choose the French channel. As you are speaking, if you plan to alternate from one language to another, you will also need to switch the interpretation channel so that it aligns with the language you are speaking.
Should members wish to request the floor, please use the raise hand feature. Should any technical challenges arise in relation to interpretation, please signal this to the chair immediately and the technical team will work to resolve the issue. If you experience other technical challenges, please contact the committee clerk with the technical assistance number provided in your invitation. Please note that we may need to suspend during these times as we need to ensure all members are able to participate fully.
I would like to introduce the senators who are participating in this meeting: Senator Tony Dean, Ontario; Senator Percy Downe, Prince Edward Island; Senator René Cormier, New Brunswick; Senator Renée Dupuis, Quebec; Senator Raymonde Gagné, Manitoba; Senator Mobina Jaffer, British Columbia; Senator Elizabeth Marshall, Newfoundland and Labrador; Senator Yonah Martin, British Columbia; Senator Elaine McCoy, Alberta; Senator Marilou McPhedran, Manitoba; Senator Lucie Moncion, Ontario; Senator Jim Munson, Ontario; Senator Josée Forest-Niesing, Ontario; Senator Ratna Omidvar, Ontario; Senator Kim Pate, Ontario; Senator Don Plett, Manitoba; Senator Raymonde Saint-Germain, Quebec; Senator Judith Seidman, Quebec; Senator Scott Tannas, Alberta; and Senator Josée Verner, Quebec.
And welcome to all those across the country viewing these proceedings.
Honourable senators, I will now move to Item 1, the minutes of the public meeting of June 25, which is in your package. I would like to briefly mention that during our last meeting, I had misunderstood who moved the adoption of the public minutes. Given this misunderstanding, it has been corrected in the minutes. With that, do we have any questions or changes to the minutes? If not, may I have a mover for the following motion:
That the public minutes of proceedings of Thursday, June 25, 2020, be adopted.
Senator Marshall, could you move that motion?
Senator Marshall: I so move.
The Chair: Thank you. It is moved by Senator Marshall. Honourable senators, in order to determine if this motion is adopted, the clerk will proceed with a roll call vote. I would ask every senator to unmute their microphone once their name is called.
Pascale Legault, Chief Corporate Services Officer and Clerk of the Standing Committee on Internal Economy, Budgets and Administration, Senate of Canada: Honourable senators, I will call the member’s name, beginning with the chair and then going in alphabetical order. Senators should indicate if they vote for, against or abstain. Simultaneous interpretation will be suspended for the vote. I will conduct the vote in both official languages.
The Honourable Senator Marwah?
Senator Marwah: Yes.
Ms. Legault: The Honourable Senator Dean?
Senator Dean: Yes.
Ms. Legault: The Honourable Senator Downe?
Senator Downe: Yes.
Ms. Legault: The Honourable Senator Dupuis?
Senator Dupuis: Yes.
Ms. Legault: The Honourable Senator Forest-Niesing?
Senator Forest-Niesing: Yes.
Ms. Legault: The Honourable Senator Gagné?
Senator Gagné: Yes.
Ms. Legault: The Honourable Senator Jaffer?
Senator Jaffer: Yes.
Ms. Legault: The Honourable Senator Marshall?
Senator Marshall: Yes.
Ms. Legault: The Honourable Senator McPhedran?
Senator McPhedran: Yes.
Ms. Legault: The Honourable Senator Moncion?
Senator Moncion: Yes.
Ms. Legault: The Honourable Senator Munson?
Senator Munson: Yes.
Ms. Legault: The Honourable Senator Plett?
Senator Plett: Yes.
Ms. Legault: The Honourable Senator Saint-Germain?
Senator Saint-Germain: Yes.
Ms. Legault: The Honourable Senator Seidman?
Senator Seidman: Yes.
Ms. Legault: The Honourable Senator Verner?
Senator Verner: Yes.
Ms. Legault: Mr. Chair, we have 15 “yes” votes.
The Chair: Thank you. I declare the motion carried.
Moving to Item 2, the next item is a motion regarding attendance of support staff during virtual in camera meetings. In response to comments made at our last meeting, steering re-examined the proposed motion and reduced the number of staff present during these meetings. Gerry would like to make a short statement.
Gérald Lafrenière, Acting Director, Governance and Strategic Planning Directorate, Senate of Canada: Good morning, senators. You have before you a proposal of basically the most limited number we could have staff to serve virtual meetings. You will see it’s very much reduced from the proposal that had been brought before the committee last week and it’s based on the concerns that were raised.
The Chair: Senators, are there any questions for Gerry? If not, can I have a mover for the following motion:
That, unless otherwise decided, the following support staff be authorized to be present during virtual in camera proceedings of this committee:
Members of the Executive Committee;
Recording Secretary;
Representative from the CIBA Secretariat;
Representative from the Speaker’s office;
Issues Management and Media Relations Advisor;
Interpreters;
Reporters; and
Technical support staff.
May I have someone move the motion?
Senator Marshall: I so move.
The Chair: It is moved by Senator Marshall. Again, the clerk will proceed with a roll call vote.
Ms. Legault: Thank you, Mr. Chair.
[Translation]
We will proceed in the same fashion as for the previous vote, honourable senators.
[English]
The Honourable Senator Marwah?
Senator Marwah: Yes.
Ms. Legault: The Honourable Senator Dean?
Senator Dean: Yes.
Ms. Legault: The Honourable Senator Downe?
Senator Downe: Yes.
Ms. Legault: The Honourable Senator Dupuis?
Senator Dupuis: Yes.
Ms. Legault: The Honourable Senator Forest-Niesing?
Senator Forest-Niesing: Yes.
Ms. Legault: The Honourable Senator Gagné?
Senator Gagné: Yes.
Ms. Legault: The Honourable Senator Jaffer?
Senator Jaffer: Yes.
Ms. Legault: The Honourable Senator Marshall?
Senator Marshall: Yes.
Ms. Legault: The Honourable Senator McPhedran?
Senator McPhedran: Yes.
Ms. Legault: The Honourable Senator Moncion?
Senator Moncion: Yes.
Ms. Legault: The Honourable Senator Munson?
Senator Munson: Yes.
Ms. Legault: The Honourable Senator Plett?
Senator Plett: Yes.
Ms. Legault: The Honourable Senator Saint-Germain?
Senator Saint-Germain: Yes.
Ms. Legault: The Honourable Senator Seidman?
Senator Seidman: Yes.
Ms. Legault: The Honourable Senator Verner?
Senator Verner: Yes.
Ms. Legault: Mr. Chair, we have 15 “yes” votes.
The Chair: I declare the motion carried.
Colleagues, the next item is on two reports from the Audit Subcommittee, which is provided for information. The first report is concerning an audit that was done by Raymond Chabot Grant Thornton, an external auditor, of Senate expenses, and the second is a report concerning the quarterly financial reports for the third and fourth quarters.
Pierre Lanctôt, Chief Financial Officer, and Nathalie Charpentier, Comptroller and Deputy Chief Financial Officer, will now join the meeting by video conference to assist in answering any questions.
Pascale, will you let them in?
Ms. Legault: They are with us, senator.
The Chair: Thank you. Senator Downe, you may begin by tabling your first report on the external audit.
Senator Downe: Colleagues, the Audit Subcommittee of the Senate Standing Committee on Internal Economy, Budgets and Administration, consisting of deputy chair Senator McPhedran and members, Senators Marshall and Dupuis, has the honour to table its first report.
As part of the Senate’s commitment to transparency and accountability, on June 13, 2019, the Standing Committee on Internal Economy, Budgets and Administration (CIBA) approved, based on a recommendation from the previous Audit Subcommittee, an independent external audit of Senate expenses, excluding salaries, for the fiscal year 2018-19, and authorized the Administration to initiate a Request for Proposal process. The objective of this audit was to ensure that expenses comply with policies and procedures (including procurement activities), and that controls and processes in place are appropriate.
This external audit of expenses is in addition tothe regular, ongoing, annual audit of theSenate’s financial statements. It adds anadditional layer of scrutiny and focusesexclusively on verifying expenses and relatedprocurement activities for both senators andthe Senate Administration.
The accounting firm Raymond Chabot Grant Thornton (RCGT) was selected following an official public request for proposals initiated on August 8, 2019, and performed the audit over the course of November 2019.
Your subcommittee met last week, on July 16, 2020, to organize and to receive the conclusions of the Audit conducted by RCGT for the fiscal year 2018-19.
The RCGT audit report presentsthe results for the samples tested for both theAdministration expenses and the Senators’expenses, observations on key findings,recommendations and management’s responseto these observations and recommendations.
Throughout the testing, the auditors observedgood practices resulting in a high rate ofcompliance. In particular, they noted that theimplementation of the Unit4 system hadstrengthened controls related to workflows,approvals and document retention. Opportunities for improvement were noted inthe area of information management andprocurement policy clarification. . . .
The RCGT audit was conducted at a cost of $99,637.50 taken from the $0.5 million budget set aside for the Audit and Oversight Committee in 2019-20 that was never created.
As a result of our own review of the RCGT report, your Audit Subcommittee identified three areas of interest that we’d like to pursue during 2020-21. Those areas are the update and improvement of the Senate Procurement Policy; an audit of information technology and cybersecurity; and an internal audit function in the Senate.
I know, Mr. Chair, we have limited time today, and for that reason we invited the auditors who conducted the report to our next meeting in August. I would urge all colleagues to take the time to read the report. It would be my suggestion, chair, that unless there’s something urgent that somebody wants to raise today, we hold our questions until the auditors are at our meeting in August. If that’s approved, chair, I can go to the second report, unless somebody has a question. If so, they can put their hand up and you can direct me.
The Chair: Thank you, Senator Downe. I see no questions or hands up on this report. I think it’s a good idea to have the auditors come and present before the committee, and we can direct the questions to them then.
I do support your three suggestions, which is setting up an internal audit function, a review of the procurement policy and IT. I think those are excellent ideas, and I commend you for suggesting them.
I see no questions, so let’s go to your second report.
Senator Downe: Colleagues, the Audit Subcommittee has the honour to table its second report.
Your subcommittee received the financialhighlights and results for the third and fourthquarters for the fiscal year 2019-20, includingthe summary of budgetary authorities, theanalysis of expenditures and year-end results,prepared by the Senate AdministrationManagement.
The Senate terminated the year with a budgetsurplus of $16.3M:$9.1M related to the Senators;$1.8M for Committees and Internationaland Interparliamentary Affairs (IIA); and$4.9M related to the Administration.
This budget surplus represents 14% of theSenate total budget of $114.2M.
Out of the $9.1 million surplus attributed to Senators: $7.7 million is from voted expenditures;$5.7 million relates to salary expendituresand other office expenses that were lower thanbudgeted. Senators spent on average 74% oftheir office budget, which was consistent withthe rate experienced in recent years; and
$1.4 million is from statutory expendituresfor senators’ remuneration, travel andtelecommunications. Even though the averagenumber of senators was higher than last year,travel expenses were less than budgeted due tothe lower number of sitting days caused by theelection and the pandemic.
The categories specific to senators’ committees and IIA had a $1.8-million surplus, mainly attributed to the lower level of travel and activities that were planned, again because of the election and the pandemic. The IIA surplus was a result of lower levels of activities. As you know, colleagues, as I mentioned in the earlier report, there was a $0.5-million budget set aside in 2019-20 for the Audit and Oversight Committee, of which we only spent $99,000, as I indicated in the previous report.
Out of the $3.5 million surplus attributed to theAdministration:
$2.5 million results from vacant positionsdue to departures; and
$0.9 million is due to some plannedpurchases that did not materialized or weredelayed as well as some goods that werereceived after March 31.
The Audit Subcommittee reviewed and discussed the risk and uncertainties associated with the institutional financial performance. It informs you that the third- and fourth-quarter financial results are compliant. Accordingly, the Audit Subcommittee has approved and now tables the quarterly financial report of the Senate of Canada for the quarter ended December 31, 2019, and for the quarter ended March 31, 2020.
We are available to answer any questions that you may have on these reports.
The Chair: Are there any questions for Senator Downe? If not, I thank you, Senator Downe, and we look forward to the presentation at the next meeting with the auditors.
We will now move on to Item 4, which is public business. Is there any other public business under “other matters,” senators? I see no hands.
(The committee continued in camera.)