Privy Council Office and Public Appointments Commission Secretariat

Section III - Supplementary Information

Organizational Information

The Privy Council Office reports directly to the Prime Minister and is headed by the Clerk of the Privy Council and Secretary to the Cabinet.

The Prime Minister’s overall responsibility is to provide leadership to create and sustain the unity of the Ministry required to maintain the confidence of Parliament. The Prime Minister demonstrates this leadership in two distinct ways:

• through the exercise of unique authorities as head of Government; and

• through the management and coordination of the Government’s agenda, as chair of Cabinet.

The core functions of the Clerk of the Privy Council and Secretary to the Cabinet and those of the entire PCO flow directly from these responsibilities. The strength of PCO is in large measure determined by its ability to concentrate its resources on supporting exclusively these two central responsibilities, in addition to helping the Clerk of the Privy Council and Secretary to the Cabinet fulfill his role as Head of the Public Service.

The PCO organization chart is shown below. Further information on the roles and functions of PCO are available on the PCO website at http://www.pco-bcp.gc.ca/.

Strengthen Internal Management Practices

One of PCO’s four priorities for 2006-2007 was to strengthen internal management practices. Four specific areas for improvement were identified and, while progress was made on every plan and internal management practices were strengthened, not all plans were completed as outlined in the RPP. Therefore the status of performance for this priority needs to be rated as “ongoing” since some of the plans have been implemented while others are in progress and will be completed in 2007-2008.

Strengthen performance measurement and reporting

To better reflect its role and core mandate, PCO undertook an internal reorganization review during 2006-2007, which resulted in the need to revise its Program Activity Architecture (PAA). Since the performance measurement strategy is based on the PAA, development of this strategy was delayed until the new PAA was approved by Treasury Board in May 2007, and will be effective in 2008-2009. PCO is developing and will be submitting its performance measurement strategy as well as its governance structure to the Treasury Board Secretariat by the end of November 2007.

Strengthen internal audit and evaluation functions

In the fall of 2005, the Central Agency Cluster, comprising the Department of Finance, the Treasury Board Secretariat, the Canadian Public Service Agency, the Privy Council Office and the Canada School of Public Service, was created as part of a shared services initiative to implement shared corporate and administrative services. It included the functions of information technology and information management, human resources, finance and administration as well as audit and evaluation. At that time, the Internal Audit and Evaluation Division of the Department of Finance was mandated to lead efforts to implement shared internal audit and evaluation services for the Central Agency Cluster. With the launch of the new internal audit policy on April 1, 2006, further thought was given to the shared services model. In early 2007, subsequent to discussions with the Office of the Comptroller General, PCO hired its own Chief Audit and Evaluation Executive (CAEE). Until the arrival of the new CAEE in May 2007, the Acting Senior Director, Internal Audit and Evaluation Division of the Department of Finance continued to fulfill the role for PCO.

During 2006-2007, initial work was done to prepare PCO for the implementation of the new internal audit policy by April 1, 2009. The terms of reference for the audit and evaluation committee, consistent with the new policy, were approved on February 22, 2007. As well, an internal audit mandate was developed along with preliminary work toward a multi-year risk-based internal audit plan. Four audit and evaluation committee meetings were held in 2006-2007. The examination of the management framework of commissions of inquiry’s contribution programs was completed. The audit of information technology security at PCO ended at the preliminary survey phase, as a number of improvements were already being implemented as the result of two other previous studies. The audit on procurement and contracting services will be finalized in 2007-2008.

With respect to evaluation, the new CAEE will establish the requirements for PCO’s formal evaluation capacity in 2007-2008 to address the upcoming revised policy. In the meantime, PCO managers undertook a number of management studies in 2006 2007 that were used to inform decision making. These included a thorough review and analysis of PCO’s activities against its core mandate in order to maximize its effectiveness and value for money; a management framework review of the contribution program for parties and interveners to commissions of inquiry; a review of PCO media analysis and monitoring; and a preliminary review of the Career on the Move initiative.

Implement the Public Service Modernization Act

The implementation of the Public Service Modernization Act was carried out under the direction of the PCO Executive Committee and a newly created Human Resources Advisory Committee (HRAC), made up of senior PCO managers. The mandate of the HRAC was to oversee the implementation of the new Act and related policies, programs and strategies and to review major human resources changes or proposals. Much of the work was carried out in 2006-2007, but the HRAC continues to be instrumental in setting the direction and reviewing human resources management issues at PCO.

Training packages were developed and delivered to all managers to assist them in carrying out their human resources management responsibilities, including those in staffing, in 2005-2006. Training and information sessions for employees continued until February 2007. Training for new managers continues.

The HRAC played a key role in the development and delivery of a Strategic Human Resources Plan for PCO. The plan was launched in the department on March 29, 2007.

Strengthen PCO’s capacity to respond to statutory obligations under the Access to Information Act and Privacy Act

Access to information and privacy (ATIP) have presented PCO with key challenges in recent years. In terms of volume, demand for access to PCO records is on the rise. Increases in the two principal areas of ATIP activity in PCO—access requests and requests for consultations—increased 23 percent and 55 percent respectively in 2006 2007. PCO custodianship of Cabinet Confidences and other ministerial papers also increases the complexity of review and approval processes, with resultant pressures on legislated deadlines. From a human resources perspective, adequate staffing in a competitive job market is a continuing concern.

PCO has demonstrated a renewed and focused commitment to its responsibilities under the Access to Information Act and the Privacy Act. The ATIP Division has been realigned into three responsibility centres to improve performance. Streamlining and optimization of work processes are underway with the introduction of electronic tasking to shorten turnaround, simplification of review and handling procedures with secretariats, and a phased migration to more modern technological tools. To address capacity issues, staffing is underway and an officer development program has been established to build expertise from within. Employee awareness and training about the Acts is also a priority, therefore the new Client Service section has upgraded training materials and is developing ATIP awareness tools to ensure corporate-wide support.

Tables

PCO’s departmental performance and resource utilization tables are presented using its strategic outcomes and new Program Activity Architecture (PAA) developed in 2005-2006.

In 2006-2007, the following financial tables were applicable to PCO’s operations:

Note to the reader:

For the year ended March 31, 2007, PCO redefined its program activities. As a result, comparative figures have been reclassified to conform with the new presentation.

Table 1 – Comparison of Planned to Actual Spending (including FTEs)

Variation between the Total Main Estimates and the Total Planned Spending

The decrease of $17.4 million is due to:

• transfers of responsibility to other departments and agencies ($14.6 million) in order to better align activities more directly with the Prime Minister’s core responsibilities;

• adjustments to ministers’ offices budgets ($5.6 million) to reflect the new ministry; and

• offset by additional funding of $2.8 million related to the Commission of Inquiry into the Actions of Canadian Officials in Relation to Maher Arar.

Variation between the Total Planned Spending and the Total Authorities

The increase of $19.1 million is related to:

• the establishment of a 2006-2007 budget of $13.5 million for the Commission of Inquiry into the Investigation of the Bombing of Air India Flight 182;

• funding for the departmental 2005-2006 Operating Budget Carry Forward of $6.3 million;

• compensation for collective bargaining of $1.2 million;

• offset by an adjustment for the transfers of responsibilities to other departments and for the ministers’ offices reductions, and for statutory adjustment related to the employee benefit plan of $1.9 million.

The transfers as a result of PCO returning to core activities are detailed below:

1. Amounts exclude employee benefit plan.
   
2. For 2008-2009 and future years, resources transferred are $829,000 and 8 FTEs due to sunsetting of certain activities.

Variation between the Total Authorities and the Total Actual Spending

The $12.8 million surplus is explained as follows:

• Prime Minister and ministers’ offices: $1.4 million surplus
  Surplus is attributable to changes in the ministers’ offices and an underutilization of resources.

• PCO: $7.7 million surplus
  The surplus is mainly due to staff vacancies, internal reorganizations that delayed staffing actions and a slowdown of activities in certain areas due to unforeseen circumstances.

• Commissions of inquiry: $3.7 million surplus
  The surplus is explained as follows:
  
  
  • The Commission of Inquiry into the Actions of Canadian Officials in Relation to Maher Arar - $1.0 million due to lower than planned expenditures particularly related to legal fees;
    
  • The Commission of Inquiry into the Investigation of the Bombing of Air India Flight 182 - surplus of $3.6 million due to delays in hearings that will now take place in the 2007-2008 fiscal year;
    
  • offset by the Internal Inquiry into the Actions of Canadian Officials in Relation to Abdullah Almalki, Ahmad Abou-Elmaati and Muayyed Nureddini - $0.9 million. This inquiry was funded from within departmental resources.

Variation between the Actual Spending of 2005-2006 and the Actual Spending of 2006-2007

The decrease of $26.8 million is due to:

• a reduction in spending as a result of PCO returning to core functions - $13.4 million;

• adjustments to ministers’ offices budgets and an overall reduction in spending - $3.9 million;

• a reduction of expenses related to commissions of inquiry - $3.5 million; and

• a reduction in salary-related costs such as severance and separation pay - $6.0 million

Table 2 – Resources by Program Activity

Table 3 – Voted and Statutory Items

Table 4 – Services Received Without Charge

Table 5 – Sources of Non-respendable Revenue

Table 6 – Resource Requirements by Branch

Table 7 – Response to Parliamentary Committees, Audits and Evaluation

Office of the Auditor General of Canada

November 2006 http://www.oag-bvg.gc.ca/domino/reports.nsf/html/06menu_e.html

Chapter 1: Expenditure Management System at the Government Centre
In this chapter the Auditor General reviewed the role of central agencies in the management of government spending. Recommendations that included PCO related to regular review and assessment of ongoing programs, completeness and accuracy of financial and non-financial information available to decision makers, clarification of roles of the Privy Council Office, Treasury Board Secretariat and Finance, and the funding of programs with long-term financial requirements. The government responded that the issues raised by the Office of the Auditor General in this report were generally consistent with those that the government believes a new expenditure management system should address.

Response: http://www.oag-bvg.gc.ca/domino/reports.nsf/html/20061101ce.html

Chapter 11: Protection of Public Assets - Office of the Correctional Investigator
The former Correctional Investigator’s and OCI managers’ personal leave, absences, cash-out of annual leave (vacation leave), and travel and hospitality expense claims were examined to determine if they complied with the Financial Administration Act and applicable Treasury Board policies, and whether they were managed with prudence and probity. The recommendations that included PCO related to the recovery of any amount of money improperly paid out, establishment of accountability of the heads of small independent agencies on matters related to financial management and human resources management, advice and training for full-time Governor-in-Council appointees about their expected standards of conduct as holders of public office, monitoring of small, independent agencies, and guidelines on policies for full-time Governor-in-Council appointees regarding management and special leave and cash-out of annual leave. PCO is in the process of revising its Guide Book for Heads of Agencies, which sets out the role of heads of agencies with respect to operations, structures and responsibilities in the federal government, and amending the booklet entitled Terms and Conditions of Employment for Full-Time Governor-in-Council Appointees so that it will include a section on standards of conduct.

Response: http://www.oag-bvg.gc.ca/domino/reports.nsf/html/20061111ce.html

Chapter 12: Role of Federally Appointed Board Members - Sustainable Development Technology Canada Auditors examined the governance of the foundation subsequent to a change made to the funding agreement that affected the role of those members of the Sustainable Development Technology Canada Board of Directors who were federally appointed. The recommendation which included PCO referred to clarification of the necessity to restrict the participation of federal government appointees to the Board of Directors of Sustainable Development Technology Canada in the decision-making process.

Response: http://www.oag-bvg.gc.ca/domino/reports.nsf/html/20061112ce.html

February 2007 http://www.oag-bvg.gc.ca/domino/reports.nsf/html/07menu_e.html

Chapter 1: Advertising and Public Opinion Research
In this status report, the OAG audited advertising campaigns and public opinion research projects to see whether the departments administering them were exercising adequate management and control and whether changes made in response to the 2003 recommendations were effective. This included a review of the roles played by the Privy Council Office, the Treasury Board Secretariat, and Public Works and Government Services Canada (PWGSC). There was only one recommendation that involved PCO and it stated that departments should ensure that the required notification of planned research is provided to Public Works and Government Services Canada prior to contacting research firms.

Response: http://www.oag-bvg.gc.ca/domino/reports.nsf/html/20070201ce.html

Commissioner of the Environment and Sustainable Development

November 2006 http://www.oag-bvg.gc.ca/domino/reports.nsf/html/c2006menu_e.html

Chapter 1: Managing the Federal Approach to Climate Change
This audit focused on the organization of the federal government to manage its climate change activities, its ability to report the costs and the results of its efforts, and the basis on which it developed key targets for reductions in greenhouse gas emissions. As well, the following aspects were reviewed: two new tools the government had chosen to help achieve its climate change objectives; readiness of the government to implement an effective domestic system for the trading of greenhouse gas emissions; and Sustainable Development Technology Canada, a foundation the government established in 2001. The AG’s recommendation which included PCO related to the development and implementation of effective governance and accountability for the climate change issue within the federal government.

Response: http://www.oag-bvg.gc.ca/domino/reports.nsf/html/c20060901ce.html

Chapter 2: Adapting to the Impacts of Climate Change
Federal government strategies and action plans for adapting to and managing the impacts of climate change were examined. Also the auditors assessed whether the federal government had taken steps to obtain, analyse, and share the information needed to identify the potential impacts to which Canadians are exposed because of climate change. The recommendation which included PCO asked for the identification of the responsibilities and accountabilities of the federal departments and agencies that are to be involved in a federal adaptation effort.

Response: http://www.oag-bvg.gc.ca/domino/reports.nsf/html/c20060902ce.html

Internal Audit and Evaluation

As reported in the 2006-2007 Report on Plans and Priorities, PCO intended to complete and report on the following audits, which started in 2005-2006:

• Audit of information technology security at the Privy Council Office

• Examination of the management framework of commissions of inquiry’s contribution programs

• Internal audit of the procurement and contracting services of the Privy Council Office

During this period, PCO was still receiving internal audit services from the Internal Audit and Evaluation Division at Finance Canada. Due to capacity issues, only the examination of the management framework of commissions of inquiry’s contribution programs was completed and approved by the Audit and Evaluation Committee. At that time, a number of the recommendations made in the review had already been implemented for the current internal review and commission of inquiry. The audit of the information technology security at the Privy Council Office ended at the preliminary survey phase, since PCO was already in the midst of implementing a number of improvements that had resulted from two other recent studies done in PCO in the same area. Work was nearly completed on the audit on procurement and contracting services.

Preliminary work on a draft, multi-year risk-based audit plan was done in 2006-2007, which is being factored into the next stage of an integrated, fulsome multi-year internal audit planning exercise during 2007-2008. In the interim, authorization was given by the Audit and Evaluation Committee to proceed with specific audits for 2007-2008.