Highlights of the 2019 Spring Reports of the Office of the Auditor General of Canada

Highlights of the 2019 Spring Reports of the Office of the Auditor General of Canada

Call Centres

This audit looked at the call centres of 3 departments: Employment and Social Development Canada; Immigration, Refugees and Citizenship Canada; and Veterans Affairs Canada.

Overall, we found that getting through to government call centres took time and persistence. In fact, we found that half of the 16 million Canadians who tried to speak to an agent could not do so. Seven million callers were redirected to an automated system, told to visit the website, or disconnected. In addition, more than a million callers gave up waiting and hung up.

We found that service decisions were not driven by Canadians’ needs. For example, departments did not offer callers the option of staying on the line or getting a call-back when an agent became available.

And the situation is unlikely to improve in the near future. The government’s Clients First Service Strategy does not include call centres, though more than 25% of Canadians use the telephone to connect with government. In addition, after 5 years of a call centre modernization project, Shared Services Canada has managed to upgrade only 8 of 221 call centres, and it has no plan for the remaining 213.

Processing of Asylum Claims

This audit examined how asylum claims were processed by the Canada Border Services Agency; Immigration, Refugees and Citizenship Canada; and the Immigration and Refugee Board.

We found that Canada’s refugee system is unable to process claims within the two-month target set by the government. In fact, backlogs and wait times are worse now than when the system was last reformed in 2012, to address these very same issues. The claims backlog has grown from 59,000 in 2010 to 71,000 in 2018. Wait times have grown from 19 months in 2010 to 2 years today.

The fundamental problem is that the system is unable to adjust to spikes in the volume of claims. With the current number of claims, if the problem remains unresolved, 5 years from now, families and individuals seeking asylum can expect to wait 5 years to find out whether Canada will grant them protection.

This fundamental flaw in the system is made worse by a number of administrative issues that would improve the processing of claims if they were fixed. For example, we found that the 3 organizations’ computer systems don’t work well together. This causes delays, duplication of effort, and a reliance on paper files. We found that almost two-thirds of hearings were postponed at least once, adding an average of five months to the time required for decisions.

Taxation of e-commerce

This audit focused on whether the Canada Revenue Agency, the Canada Border Services Agency, and the Department of Finance Canada ensured that the sales tax system for e-commerce was neutral and that the sales tax base was protected.

We found that the Canadian sales tax system did not keep pace with the rapidly evolving digital marketplace. We estimated that Canada had foregone $169 million in sales tax revenues on digital products.

The Department of Finance’s analysis of the e-commerce sales tax system has shown that there is a risk that the current system could discourage foreign businesses from settling in Canada, and encourage Canadian businesses to move their operations to other countries.

The Canada Revenue Agency and the Canada Border Services Agency have a role to play in ensuring that all taxes are collected and remitted to the government. We found that they have not done enough work to make sure that this is happening.

For example, we found that the Canada Revenue Agency has identified e-commerce and accommodation sharing as corporate risks, but it has done little to address these risks. Taking the case of accommodation sharing―an industry which has grown almost 10-fold to $2.8 billion in just 3 years―the Agency could confirm that it had audited only 4 companies.

The Canada Revenue Agency does not have the authority to implement practices that have been successful in other countries or provinces, such as putting in place a simplified registration process for foreign businesses.

We also looked at how the Canada Border Services Agency managed the collection of taxes on low-value parcels imported through courier companies. We found that the Agency’s systems and processes were outdated, and it relied on couriers to remit taxes owing. The Agency did little work in response to warning signs, such as an unexplained increase in the volume of parcels valued under $20—and therefore not subject to tax—or audits showing a significant undervaluation of parcels by couriers.

Oversight of Government of Canada Advertising

This audit looked at the oversight mechanism that the government has put in place to ensure that it meets its commitment to non-partisan advertising. It’s important to understand that the government has a policy that requires all its communications to be non-partisan. For advertising—which is a subset of communications—the government has put in place a review mechanism to prevent taxpayer dollars from being used for partisan advertising.

For campaigns with a budget of less than $500,000, the review is to be conducted by Public Services and Procurement Canada. Campaigns with a budget of more than $500,000 are subject to an external review conducted by an organization called Ad Standards.

We found that the money threshold is the only factor that determines whether advertising is reviewed externally. In our view, other factors―such as the topic of a campaign or its potential reach―could also be considered when assessing the risk of partisanship in government advertising because, for example, a small value campaign on a politically sensitive topic may carry more risk of partisanship than a more expensive campaign that is strictly informational.

The audit also found that there was little documentation to show that reviews—whether internal or external—were conducted with sufficient rigour to address the risk of partisanship.

Equipping Officers of the Royal Canadian Mounted Police

This audit focused on whether the RCMP provided its officers with the hard-body armour vests and carbines they need to respond to an active shooter situation.

We found that the RCMP had enough protective vests across the country, but that distribution was uneven. In other words, not all officers had access to a vest. We also found that the RCMP did not know if all officers who needed a carbine had access to one.

Due to a lack of planning, the RCMP was not prepared to meet the long-term requirements of adding a new weapon to its inventory. This affected both maintenance of the carbine and annual recertification on its use. We found that maintenance had not been completed for about half of carbines.

Audits of Crown corporations completed since fall 2018

Our audits of the Business Development Bank of Canada and Canada Post Corporation found no significant deficiencies in these corporations’ practices.

We reported a significant deficiency in the audits of Marine Atlantic incorporatedInc. and the National Museum of Science and Technology. In the first case, the problem was due to the government’s delays in approving Marine Atlantic’s corporate plans, which hindered the corporation’s ability to make long term strategic decisions. We raised this same problem in our 2009 audit.

In the case of the National Museum of Science and Technology, we found many weaknesses in the way the Corporation managed, safeguarded and preserved its collection. Combined, these weaknesses amounted to a significant deficiency.