Opening Statement to the Standing Senate Committee on National Finance
COVID-19 Vaccines
(Report 9—2022 Reports of the Auditor General of Canada)
Specific COVID-19 Benefits
(Report 10—2022 Reports of the Auditor General of Canada)
15 February 2023
Karen Hogan, Fellow Chartered Professional AccountantFCPA
Auditor General of Canada
Mr. Chair, thank you for this opportunity to discuss the 2 COVID‑19 reports that we presented to Parliament on December 6th, 2022. I would like to acknowledge that this hearing is taking place on the traditional unceded territory of the Algonquin Anishinaabe people. Joining me this evening are my Deputy Auditor General, Andrew Hayes, as well as Susan Gomez and Mélanie Cabana, who led the audits.
I will start with our audit of COVID‑19 vaccines. In this audit, we examined how the federal government procured, authorized, and distributed vaccines to the provinces and territories to support the largest immunization program in the country’s history.
Overall, we found that the Public Health Agency of Canada, Health Canada, and Public Services and Procurement Canada worked together to respond to the urgent nature of the pandemic. Between December 2020 and May 2022, the federal government paid for 169 million vaccine doses. Over 84 million were administered to eligible people across the country.
In 2020, Public Services and Procurement Canada established advance purchase agreements with 7 companies that showed the potential to develop viable vaccines. This was done so that Canada could obtain enough doses to immunize all eligible people once vaccines became available.
We found that Health Canada followed a systematic process to authorize COVID‑19 vaccines and that it adjusted its processes to accelerate approvals. For example, the department reviewed information from manufacturers as it became available instead of waiting to receive a complete application package.
On average, the Public Health Agency of Canada delivered vaccines within 2 days of receiving a province’s or a territory’s request. This is successful considering the logistics of transporting temperature‑sensitive materials to sometimes remote locations.
We found that the Public Health Agency of Canada and Health Canada collected and analyzed COVID‑19 vaccine surveillance data to monitor the safety, coverage, and effectiveness of the vaccines. However, because data-sharing agreements with the provinces and territories were not finalized, the agency struggled to effectively share detailed case-level safety surveillance data with Health Canada, the World Health Organization, and vaccine companies.
We found that problems with information sharing also affected the Public Health Agency of Canada’s ability to accurately gather inventory, wastage, and expiry information. Delays in implementing important functionalities of VaccineConnect also contributed to the agency’s lack of ability to track wastage.
By the end of May 2022, Canada had 32.5 million doses of COVID‑19 vaccines—estimated to be worth about $1 billion—in federal, provincial, and territorial inventories. Another 50.6 million doses were deemed surplus and offered for donation.
Between December 2020 and May 31st, 2022, which marked the end of the period covered by our audit, 15.1 million doses were wasted. The Public Health Agency of Canada informed us that from June to December 2022, another 11 million doses expired before they could be used or donated. Wastage can happen for many reasons, and given the evolving nature of the pandemic, some wastage was to be expected.
We raised concerns about the sharing of health data between federal and provincial or territorial health authorities in 1999, in 2002, in 2008, and again in 2021. These long-standing issues, including implementing a pan‑Canadian framework for sharing information, must be urgently addressed because the sharing of health data is a cornerstone of effective surveillance to keep Canadians safe.
I’m going to turn now to the second audit we released in December. This audit examined 6 COVID‑19 programs intended to support individuals and employers through the pandemic. We looked at whether Employment and Social Development Canada and the Canada Revenue Agency managed these programs efficiently and effectively and whether the programs provided value for money. We also looked at whether benefit payments were accurate and made to eligible recipients and whether procedures to recover overpayments and payments made to ineligible recipients were timely.
At the start of the pandemic, the department and the agency effectively delivered COVID‑19 benefits to provide quick financial relief to individuals and employers. To issue payments quickly, the government decided to limit pre-payment controls by relying on information provided by applicants. In doing so, it recognized that post-payment work would be needed to verify that benefit payments were accurate and made to eligible recipients.
As the pandemic continued and programs were extended and modified, the department and the agency added some pre-payment controls. However, for each program, some eligibility criteria had no corresponding pre-payment control.
For all the programs we audited, we found that overpayments of $4.6 billion were made to ineligible recipients. We also estimated that payments of at least $27.4 billion should be investigated further to confirm whether recipients were eligible.
We found that the number of post-payment verifications that the department and the agency had planned was low. The department and the agency did not plan to verify all the payments made to recipients identified as potentially ineligible.
Efforts to collect amounts owing had been limited at the time of our report. As of summer 2022, approximately $2.3 billion of COVID‑19 benefit overpayments had been repaid.
While the effective delivery of benefits early in the pandemic helped prevent an increase in poverty and income inequalities and helped the economy bounce back, I am concerned by the limited progress in post-payment verification work. The government knew that its decision to limit pre-payment controls would require significant verification work later. However, neither resources nor plans have been sufficiently adjusted to support this work.
The federal government spent billions of dollars to help people in a time of crisis, and it does not know whether that money always went to eligible recipients. In the interest of being fair to all taxpayers, the government must carry out rigorous verification work. After identifying the payments that went to recipients that were not eligible, the government can then decide how and when it wants to collect those amounts. Regardless of the approach it takes, it must be clear and transparent with Canadians.
Mr. Chair, this concludes my opening remarks. We would be pleased to answer any questions the committee may have. Thank you.