Chapter 5—Departmental Progress in Implementing Sustainable Development Strategies

Introduction
Observations and Recommendations
- Mechanisms to apply the Cabinet directive
- Results of applying the Cabinet directive
Conclusion
About the Audit
Appendix—List of recommendations
Exhibits:
- 5.1—Factors to consider when assessing environmental effects
- 5.2—Most departments are contributing to the FSDS commitment to strengthen application of the Cabinet directive and related guideline

Performance audit reports

This report presents the results of a performance audit conducted by the Office of the Auditor General of Canada under the authority of the Auditor General Act.

A performance audit is an independent, objective, and systematic assessment of how well government is managing its activities, responsibilities, and resources. Audit topics are selected based on their significance. While the Office may comment on policy implementation in a performance audit, it does not comment on the merits of a policy.

Performance audits are planned, performed, and reported in accordance with professional auditing standards and Office policies. They are conducted by qualified auditors who

establish audit objectives and criteria for the assessment of performance;
gather the evidence necessary to assess performance against the criteria;
report both positive and negative findings;
conclude against the established audit objectives; and
make recommendations for improvement when there are significant differences between criteria and assessed performance.

Performance audits contribute to a public service that is ethical and effective and a government that is accountable to Parliament and Canadians.

Introduction

Importance of strategic environmental assessments

5.1 In order to make informed decisions that support sustainable development, decision makers at all levels of government must have relevant information on environmental, economic, and social factors. This is particularly important for ministers of federal departments, whose decisions on government policies, plans, and programs can have important implications for Canada’s economy, society, and environment. It is also important for stakeholders to see that the government has considered factors in all three areas when making its decisions.

Federal Sustainable Development Strategy (FSDS)—A federal document intended to present a government-wide perspective on environmental priorities, goals, targets, and intended actions. The Federal Sustainable Development Act requires the Minister of the Environment to develop an FSDS every three years. The first FSDS (2010–2013 FSDS) was released in 2010 and the second (2013–2016 FSDS) was released in 2013.

Departmental sustainable development strategy—A federal department’s or agency’s plan composed of goals, targets, and implementation strategies that will contribute to the overall goal of furthering sustainable development.

Strategic environmental assessment—A key analytical tool used by the federal government to support environmentally sustainable decision making. It evaluates the environmental effects [both positive and negative] of a proposed policy, plan, or program and its alternatives, and informs strategic decision making through a careful analysis of environmental risks and opportunities.

Source: Environment Canada

Environmental effects—“Any change that [a] policy, plan or program may cause in the environment, including any effect of any such change on health and socio-economic conditions, on physical and cultural heritage, on the current use of lands and resources for traditional purposes by Aboriginal persons, or on any structure, site or thing that is of historical, archaeological, paleontological or architectural significance.” These changes can occur within or outside Canada.

Source: Strategic Environmental Assessment: The Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals: Guidelines for Implementing the Cabinet Directive, 2010

Reports on plans and priorities—Individual expenditure plans for each department and agency. These reports provide details on an organization’s main priorities, plans, and expected performance over a three-year period. Reports for the next fiscal year are normally tabled in Parliament on or before 31 March.

Departmental performance reports—Individual department and agency accounts of results achieved against performance expectations as set out in the relevant reports on plans and priorities. The reports cover the most recent fiscal year. They are normally tabled in Parliament in the fall.

5.2 By passing the Federal Sustainable Development Act, the government acknowledged the need to integrate environmental, economic, and social factors in all government decision making. The Act requires that a Federal Sustainable Development Strategy (FSDS) be developed that would make environmental decision making more transparent and accountable to Parliament. Today, 26 departments and agencies are required to prepare a departmental sustainable development strategy, which must contain their own objectives and also contribute to the FSDS.

5.3 The Commissioner of the Environment and Sustainable Development is required to report on the government’s progress toward sustainable development. The Commissioner must also monitor and report annually on how well departments and agencies have met the objectives and implemented the plans set out in their departmental sustainable development strategies, including their contribution to meeting the targets set out in the FSDS.

5.4 The government’s first FSDS, released in 2010, established a government-wide picture of actions and intended results to achieve environmental sustainability. In this strategy, the government committed to applying strategic environmental assessment more stringently and to considering the environment in federal government decision making. In response, many departments and agencies indicated in their departmental sustainable development strategies for the 2011–12 fiscal year that they would strengthen their strategic environmental assessment practices. Examples of their commitments included updating their internal guidance and reporting practices.

The Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals

5.5 The Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals was first issued in 1990 and was revised over the years, most recently in 2010. The directive requires departments and agencies to link their policy, plan, and program proposals to FSDS goals and targets. Departments and agencies are also required to conduct a strategic environmental assessment for a policy, plan, or program proposal being submitted to a minister or to Cabinet for approval if the proposal’s implementation could result in important environmental effects, either positive or negative. The Cabinet directive also identifies special cases for which a strategic environmental assessment is not required: emergency and urgency cases, and proposals that have been assessed previously.

5.6 The current Cabinet directive gives departments and agencies flexibility in developing their own mechanisms to apply the directive. However, the directive requires a number of things:

Department and agency officials are responsible for ensuring that environmental considerations are properly integrated into the development of proposals.
Strategic environmental assessments must consider how the proposal could affect the goals and targets of the FSDS.
Departments and agencies must prepare public statements of the environmental effects of all approved or announced policies, plans, and programs for which they have conducted a detailed analysis through a strategic environmental assessment.
Departments and agencies must report on the extent and results of their strategic environmental practices in their reports on plans and priorities and departmental performance reports.

5.7 The Cabinet directive presents a multi-step process for systematically analyzing and documenting strategic environmental assessments:

The first step, conducting a preliminary scan, aims to identify, at the earliest point in the process, whether the proposal has the potential for important environmental effects, either positive or negative. Where important environmental effects have been identified, the second and third steps apply.
The second step is a detailed strategic environmental assessment, which further analyzes and assesses the important environmental effects that were identified in the preliminary scan.
The third step is the public reporting on the results of strategic environmental assessments to support transparency and accountability. The directive encourages, but does not require, departments and agencies to publicly report on results of preliminary scans.

Exhibit 5.1 provides an example of guidance from the Cabinet directive.

Exhibit 5.1—Factors to consider when assessing environmental effects

The Cabinet directive requires departments and agencies to address the following considerations when analyzing environmental effects:

the scope and nature of potential effects, including cumulative effects and a description of how they will affect Federal Sustainable Development Strategy (FSDS) goals and targets;
the need for mitigation or opportunities for enhancement, such as conditions that may be placed on activities arising from the proposal;
the scope and nature of residual effects potentially remaining after mitigation or enhancement measures;
the need for follow-up, to monitor potential environmental effects or to ensure support of FSDS goals or targets; and
concerns about potential environmental effects of the proposal among those likely to be most affected, and among other stakeholders and the public.

Responsibilities in applying the Cabinet directive

5.8 The Cabinet directive gives responsibility to three central agencies, the Privy Council Office, the Treasury Board of Canada Secretariat, and the Department of Finance Canada, to work with federal departments and agencies when they are developing documents for Cabinet. The role of the central agencies is to ensure that departments fully consider the Cabinet directive and include all relevant factors in their proposals to Cabinet or to the Treasury Board.

Previous audits

5.9 In 2004, the Commissioner audited whether the government had made any progress in implementing the Cabinet directive. The audit found that

there was a low level of commitment in departments and agencies toward conducting strategic environmental assessments;
few departments had put in place the basic mechanisms to manage the process; and
the central agencies demonstrated a lack of ownership and support, which contributed to the low level of commitment in departments and agencies to carry out the Cabinet directive.

5.10 In a 2008 follow-up audit, the Commissioner found that

departmental management systems remained weak,
the Cabinet directive was not being applied evenly to all proposals presented by departments and agencies to their ministers or to Cabinet, and
the Privy Council Office did not challenge departments and agencies on their application of the Cabinet directive when they submitted proposals to Cabinet.

5.11 In 2013, we examined whether selected departments had met their commitments to update internal guidance related to strategic environmental assessment; we reported that most of them had made satisfactory progress.

Focus of the audit

5.12 This audit forms part of the Commissioner’s annual monitoring of sustainable development strategy commitments. The audit focused on the government’s 2010 FSDS commitment to strengthen consideration of the environment in its decision making by more stringently applying strategic environmental assessment.

5.13 The audit objective was to determine whether selected departments and two central agencies (the Privy Council Office and the Treasury Board of Canada Secretariat) have mechanisms in place

to support compliance with important aspects of the Cabinet directive and its related guidelines, and
to ensure that environmental implications and considerations are integrated into proposals submitted to an individual minister or to Cabinet for approval.

5.14 To determine whether departments had mechanisms in place to support compliance with the Cabinet directive, we selected five departments, each of which had made commitments to strengthen their strategic environmental assessment processes in their 2011–12 departmental sustainable development strategies. The departments are

Aboriginal Affairs and Northern Development Canada,
Citizenship and Immigration Canada,
Health Canada,
Natural Resources Canada, and
Transport Canada.

Memoranda to Cabinet—Documents that provide written policy advice to Cabinet or seek Cabinet support for a proposed course of action. They play a key role in Cabinet decision making.

Treasury Board submission—A document submitted by a department or agency seeking approval for a proposed initiative. Even after Cabinet approves a policy initiative, Treasury Board approval is still needed to carry out the initiative. A submission includes details of design and delivery, yearly cost of the initiative, and expected results and outcomes.

5.15 We examined a selection of memoranda to Cabinet and Treasury Board submissions from the five departments submitted to Cabinet or to the Treasury Board for decision during the calendar years 2012 and 2013. We looked at these to see if the Cabinet directive was applied and whether environmental implications and considerations were properly integrated into the proposals submitted to Cabinet or to the Treasury Board for approval. The audit covered the period between September 2010 and June 2014.

5.16 More details about the audit objective, scope, approach, and criteria are in About the Audit at the end of this chapter.

Observations and Recommendations

Mechanisms to apply the Cabinet directive

5.17 Overall, we found that most of the five audited departments have mechanisms in place to apply the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and have established some good practices to help strengthen their strategic environmental assessment processes. However, most departments examined have not established mechanisms to apply the Cabinet directive to proposals going to individual ministers. Central agencies have recently revised their internal processes to help ensure that the Cabinet directive is applied to proposals going to Cabinet or the Treasury Board. These findings are important because the Cabinet directive was issued to ensure that decision makers receive information to help them consider the environmental effects of their decisions.

5.18 We examined whether the five audited departments, the Privy Council Office, and the Treasury Board of Canada Secretariat have mechanisms in place to support compliance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals. We looked at whether there were mechanisms in place to ensure that environmental implications and considerations are integrated into proposals submitted to an individual minister, Cabinet, or the Treasury Board for approval.

We examined whether the five departments have defined roles and responsibilities, internal guidance, tracking mechanisms, and specific tools to support the preparation of strategic environmental assessments as required by the Cabinet directive. We also examined whether departments were reporting publicly on the extent and results of their strategic environmental assessment practices, including the number of preliminary scans and strategic environmental assessments completed, links to the Federal Sustainable Development Strategy (FSDS) goals and targets, and whether the departments had dedicated strategic environmental assessment sections on their departmental websites.
We examined whether the Privy Council Office and the Secretariat have mechanisms in place to help ensure that environmental implications and considerations have been integrated into Cabinet and Treasury Board proposals.

5.19 We interviewed officials from all five departments and both central agencies. We also reviewed information publicly available as well as documentation held within each of the five departments, the Privy Council Office, and the Secretariat.

Most departments examined have mechanisms to apply the Cabinet directive to proposals going to Cabinet

5.20 We found that four of the five departments we examined—Citizenship and Immigration Canada, Health Canada, Natural Resources Canada, and Transport Canada—had established the mechanisms necessary to adequately manage their strategic environmental assessment processes and support compliance with the Cabinet directive. These mechanisms also contribute to meeting their departmental sustainable development strategy commitments for the 2011–12 fiscal year and to meeting the FSDS commitment of strengthening the application of strategic environmental assessment. The fifth department, Aboriginal Affairs and Northern Development Canada, has mechanisms for conducting strategic environmental assessments; however, we noted several areas that require improvement to ensure that the process effectively complies with the 2010 Cabinet directive. As a result, we concluded that Aboriginal Affairs and Northern Development Canada does not have mechanisms in place to adequately manage their strategic environmental assessment processes. Specific results for each department are shown in Exhibit 5.2. The ratings represent our overall conclusion on the adequacy of both the mechanisms established by each department to manage their strategic environmental assessment processes, and their public reporting practices.

Exhibit 5.2—Most departments are contributing to the FSDS commitment to strengthen application of the Cabinet directive and related guideline

Department	2011–12 Departmental sustainable development strategy commitments	Results	Overall progress for departmental process and public reporting practices
Aboriginal Affairs and Northern Development Canada	Departmental process Strengthen the application of SEAs by ensuring that the Government of Canada’s environmental goals are taken into account when pursuing social and economic goals.	Departmental process Internal SEA guidance and templates were not updated to reflect the most recent changes to the Cabinet directive (2010). The guidance does not refer to the requirement to consider linkages with FSDS goals and targets.	Unsatisfactory
Public reporting practices Pursue best practices on reporting on summary information on the results of strategic environmental assessments linked to the FSDS goals and targets in order to ensure that environmental decision making is more transparent.	Public reporting practices Its departmental performance report refers to the Cabinet directive but does not mention number of preliminary scans completed by the department. (Reporting on scans is encouraged by the directive but not required.) The Department’s reporting on its 2012–13 departmental sustainable development strategy mentions that initiatives were found to have no environmental effects on FSDS goals and targets, yet its SEA process at that time did not assess FSDS linkages. The Department’s website does not have a dedicated section on strategic environmental assessment results.
Citizenship and Immigration Canada	Departmental process Citizenship and Immigration Canada has developed, piloted, and will implement a Policy on Sustainable Development Assessments and supporting tools. This policy brings together the principles of sustainable development as stated in the Federal Sustainable Development Act and links the goals and targets of the FSDS to the Cabinet directive, and the requirement to undertake strategic environmental assessments.	Departmental process The Department released an updated version of its Policy on Sustainable Development Assessments along with supporting guidance and templates, and delivered training. Until 2014, the Department did not apply the Cabinet directive to proposals going to Treasury Board.	Satisfactory
Public reporting practices Where important environmental effects (either positive or negative) have been identified in a sustainable development assessment, a public statement will be used to demonstrate that environmental factors have been integrated into the decision-making process.	Public reporting practices The Department’s website includes a statement that the department will make a public statement when its initiatives have important environmental impacts, including impacts on FSDS goals and targets. We noted some areas for improvement. It does not provide information on preliminary scans completed by the department. (Reporting on scans is encouraged by the directive but not required.) The Department’s website includes a dedicated section on SEA results. However, since no detailed strategic environmental assessments have been conducted to date, no public statements have been published.
Health Canada	Departmental process Strengthening the application of SEAs by ensuring that the Government's environmental goals are taken into account in the pursuit of its mandate.	Departmental process Health Canada revised its SEA policy, guidance, and tools, and delivered new training sessions.	Satisfactory
Public reporting practices Pursuing best practices on reporting the summary results of SEAs linked to the FSDS goals and targets. This will support the principle of making environmental decision making more transparent.	Public reporting practices Its departmental performance report mentions a detailed SEA completed in 2011 and contribution of the initiative to the FSDS goals and targets. It does not mention the number of preliminary scans conducted. (Reporting on scans is encouraged by the directive but not required.) Health Canada’s departmental sustainable development strategy performance report presents the compliance rate with applying its SEA policy. The Health Canada website has a dedicated section on SEA that includes public statements.
Natural Resources Canada	Departmental process Update internal departmental policy to incorporate new requirements of the guidelines supporting the Cabinet directive, such as analyzing within SEAs the impact of policy, plan, and program proposals on FSDS goals and targets; reporting on SEA results through departmental performance reports; and describing the impact of policy, plan, and program proposals on FSDS goals and targets in SEA public statements. Update departmental guidance material (such as SEA templates, internal websites, and training material) to ensure that the impact of policy, plan, and program proposals on FSDS goals and targets is considered and documented in SEAs. Deliver briefing and training sessions to departmental staff. Provide relevant departmental SEA materials (such as guidance, templates, and case studies) to the interdepartmental network of SEA coordinators in support of fostering a community of practice on SEA.	Departmental process Natural Resources Canada updated its policy, guidance, and tools, released its Directive on Environmental Assessment, delivered training, and provided advice, input, and materials to the interdepartmental network of SEA coordinators.	Satisfactory
Public reporting practices Report on rate of departmental compliance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its supporting guidelines.	Public reporting practices Its departmental performance report mentions the percentage of proposals that contribute to FSDS goals and targets and refers to the Department’s website for information on detailed SEAs. It does not mention the number of preliminary scans conducted. (Reporting on scans is encouraged by the directive but not required.) The departmental sustainable development strategy performance report presents the compliance rate with the Cabinet directive and its supporting guidelines, and the rate of contribution of proposals to FSDS themes, goals, and targets. The departmental website has a dedicated section on SEA, which includes public statements.
Transport Canada	Departmental process Update Transport Canada’s internal Strategic Environmental Assessment Policy Statement to incorporate new requirements. Update its guidance material (templates, manuals, training material) to ensure practitioners understand these new requirements. Revise internal processes to link SEA results to the FSDS goals and targets. Revise internal procedures for the preparation of public statements to address this new requirement.	Departmental process Transport Canada updated its Strategic Environmental Assessment Policy Statement and its supporting material, including guidance, training documents, tools, and correspondence products.	Satisfactory
Public reporting practices Report on the number of proposals (memoranda to Cabinet, Treasury Board submissions, regulatory amendments) submitted by Transport Canada to Cabinet or Treasury Board and approved. Report on the number of proposals for which the SEA process was completed (preliminary scans or detailed analysis). Report on Transport Canada’s overall SEA compliance percentage. Report on the number of proposals for which the SEA process was completed and that contributed to FSDS goals and targets.	Public reporting practices Its departmental performance report refers to its website for more information. It does not include the number of preliminary scans conducted. (Reporting on scans is encouraged by the directive but not required.) Transport Canada’s strategic environmental assessment website presents the number of detailed SEAs completed by the Department from 2005 to 2010. The Department’s sustainable development strategy discusses the contribution of its initiatives to the FSDS, and its overall compliance rate, including the total number of proposals compared with the number of proposals assessed through the SEA process. Transport Canada’s website has a dedicated section on SEA, which includes public statements.

Department

2011–12 Departmental sustainable development strategy commitments

Results

Overall progress for departmental process and public reporting practices

Aboriginal Affairs and Northern Development Canada

Departmental process

Strengthen the application of SEAs by ensuring that the Government of Canada’s environmental goals are taken into account when pursuing social and economic goals.

Departmental process

Internal SEA guidance and templates were not updated to reflect the most recent changes to the Cabinet directive (2010). The guidance does not refer to the requirement to consider linkages with FSDS goals and targets.

Unsatisfactory

Public reporting practices

Pursue best practices on reporting on summary information on the results of strategic environmental assessments linked to the FSDS goals and targets in order to ensure that environmental decision making is more transparent.

Public reporting practices

Its departmental performance report refers to the Cabinet directive but does not mention number of preliminary scans completed by the department. (Reporting on scans is encouraged by the directive but not required.)
The Department’s reporting on its 2012–13 departmental sustainable development strategy mentions that initiatives were found to have no environmental effects on FSDS goals and targets, yet its SEA process at that time did not assess FSDS linkages.
The Department’s website does not have a dedicated section on strategic environmental assessment results.

Citizenship and Immigration Canada

Departmental process

Citizenship and Immigration Canada has developed, piloted, and will implement a Policy on Sustainable Development Assessments and supporting tools. This policy brings together the principles of sustainable development as stated in the Federal Sustainable Development Act and links the goals and targets of the FSDS to the Cabinet directive, and the requirement to undertake strategic environmental assessments.

Departmental process

The Department released an updated version of its Policy on Sustainable Development Assessments along with supporting guidance and templates, and delivered training.
Until 2014, the Department did not apply the Cabinet directive to proposals going to Treasury Board.

Satisfactory

Public reporting practices

Where important environmental effects (either positive or negative) have been identified in a sustainable development assessment, a public statement will be used to demonstrate that environmental factors have been integrated into the decision-making process.

Public reporting practices

The Department’s website includes a statement that the department will make a public statement when its initiatives have important environmental impacts, including impacts on FSDS goals and targets. We noted some areas for improvement. It does not provide information on preliminary scans completed by the department. (Reporting on scans is encouraged by the directive but not required.)
The Department’s website includes a dedicated section on SEA results. However, since no detailed strategic environmental assessments have been conducted to date, no public statements have been published.

Health Canada

Departmental process

Strengthening the application of SEAs by ensuring that the Government's environmental goals are taken into account in the pursuit of its mandate.

Departmental process

Health Canada revised its SEA policy, guidance, and tools, and delivered new training sessions.

Satisfactory

Public reporting practices

Pursuing best practices on reporting the summary results of SEAs linked to the FSDS goals and targets. This will support the principle of making environmental decision making more transparent.

Public reporting practices

Its departmental performance report mentions a detailed SEA completed in 2011 and contribution of the initiative to the FSDS goals and targets. It does not mention the number of preliminary scans conducted. (Reporting on scans is encouraged by the directive but not required.)
Health Canada’s departmental sustainable development strategy performance report presents the compliance rate with applying its SEA policy.
The Health Canada website has a dedicated section on SEA that includes public statements.

Natural Resources Canada

Departmental process

Update internal departmental policy to incorporate new requirements of the guidelines supporting the Cabinet directive, such as analyzing within SEAs the impact of policy, plan, and program proposals on FSDS goals and targets; reporting on SEA results through departmental performance reports; and describing the impact of policy, plan, and program proposals on FSDS goals and targets in SEA public statements.
Update departmental guidance material (such as SEA templates, internal websites, and training material) to ensure that the impact of policy, plan, and program proposals on FSDS goals and targets is considered and documented in SEAs.
Deliver briefing and training sessions to departmental staff.
Provide relevant departmental SEA materials (such as guidance, templates, and case studies) to the interdepartmental network of SEA coordinators in support of fostering a community of practice on SEA.

Departmental process

Natural Resources Canada updated its policy, guidance, and tools, released its Directive on Environmental Assessment, delivered training, and provided advice, input, and materials to the interdepartmental network of SEA coordinators.

Satisfactory

Public reporting practices

Report on rate of departmental compliance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its supporting guidelines.

Public reporting practices

Its departmental performance report mentions the percentage of proposals that contribute to FSDS goals and targets and refers to the Department’s website for information on detailed SEAs. It does not mention the number of preliminary scans conducted. (Reporting on scans is encouraged by the directive but not required.)
The departmental sustainable development strategy performance report presents the compliance rate with the Cabinet directive and its supporting guidelines, and the rate of contribution of proposals to FSDS themes, goals, and targets.
The departmental website has a dedicated section on SEA, which includes public statements.

Transport Canada

Departmental process

Update Transport Canada’s internal Strategic Environmental Assessment Policy Statement to incorporate new requirements.
Update its guidance material (templates, manuals, training material) to ensure practitioners understand these new requirements.
Revise internal processes to link SEA results to the FSDS goals and targets.
Revise internal procedures for the preparation of public statements to address this new requirement.

Departmental process

Transport Canada updated its Strategic Environmental Assessment Policy Statement and its supporting material, including guidance, training documents, tools, and correspondence products.

Satisfactory

Public reporting practices

Report on the number of proposals (memoranda to Cabinet, Treasury Board submissions, regulatory amendments) submitted by Transport Canada to Cabinet or Treasury Board and approved.
Report on the number of proposals for which the SEA process was completed (preliminary scans or detailed analysis).
Report on Transport Canada’s overall SEA compliance percentage.
Report on the number of proposals for which the SEA process was completed and that contributed to FSDS goals and targets.

Public reporting practices

Its departmental performance report refers to its website for more information. It does not include the number of preliminary scans conducted. (Reporting on scans is encouraged by the directive but not required.)
Transport Canada’s strategic environmental assessment website presents the number of detailed SEAs completed by the Department from 2005 to 2010. The Department’s sustainable development strategy discusses the contribution of its initiatives to the FSDS, and its overall compliance rate, including the total number of proposals compared with the number of proposals assessed through the SEA process.
Transport Canada’s website has a dedicated section on SEA, which includes public statements.

FSDS—Federal Sustainable Development Strategy

SEA—Strategic environmental assessment

Satisfactory—The department has established mechanisms necessary to adequately manage its strategic environmental assessment processes, to support compliance with the Cabinet directive, and to support its sustainable development commitments. This result does not mean that no further work is required.

Unsatisfactory—The department has not established mechanisms necessary to adequately manage their strategic environmental assessment processes, to support compliance with the Cabinet directive, and to support its sustainable development commitments. This result means that further work is required.

5.21 Four of the five departments examined—Citizenship and Immigration Canada, Health Canada, Natural Resources Canada, and Transport Canada—have established centralized teams that track their strategic environmental assessment processes. These teams also help staff who conduct strategic environmental assessments. Aboriginal Affairs and Northern Development Canada, on the other hand, has established a decentralized process, which delegates the responsibility for applying the Cabinet directive to each of its nine sectors. The audit found that roles and responsibilities for strategic environmental assessment processes at Aboriginal Affairs and Northern Development Canada have not been kept up to date. For example, at the time of our audit, a working group of directors general, responsible for maintaining guidance materials for staff and monitoring the implementation of the Cabinet directive across the Department, was no longer active. Similarly, a committee of experts on strategic environmental assessment that was responsible for providing expert advice and technical support to the working group of directors general was also no longer active. Moreover, we found weaknesses in the Department’s tracking of strategic environmental assessment activities. During the audit, the Department had begun to take steps to address these issues.

5.22 Recommendation. Aboriginal Affairs and Northern Development Canada should update its strategic environmental assessment process to ensure compliance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines.

The Department’s response. Agreed. Aboriginal Affairs and Northern Development Canada has already developed and implemented a comprehensive plan to ensure compliance with the directive. During the audit period, departmental strategic environmental assessment (SEA) guidance documents, tools, and processes have been reworked to reflect the changes to the 2010 Cabinet directive, as follows:

Roles and responsibilities, linkages to the FSDS, and clear reflection of public statements and Departmental Performance Report reporting requirements have been updated.
The Cabinet Proposal Checklist, required before the drafting of a Cabinet proposal, has been updated to specify requirements to complete the strategic environmental assessment/gender-based analysis/Official Languages Act forms, which are mandatory for all Cabinet documents prepared in the Department. It should be noted that the Department’s checklists include Treasury Board submissions and memoranda to Cabinet.
The critical path document has been updated to emphasize the need to complete the amalgamated strategic environmental assessment/gender-based analysis/Official Languages Act forms document at the outset of any Cabinet document process, with links to appropriate resources.
Completion status of SEAs and other compulsory analyses have been embedded in the development and tracking of Cabinet documents. Cabinet Affairs’ internal tracking system tracks each Cabinet proposal presented to Cabinet committees and will include the Comprehensive Integrated Document Management system number for its respective strategic environmental assessment/gender-based analysis/Official Languages Act forms.
All Cabinet proposals presented at the Director General Policy Committee are required to submit completed and approved strategic environmental assessment, gender-based analysis, and Official Languages Act analyses to be included in the discussion; the minutes of each meeting will confirm their completion as well as any related comments.
In addition, training to complete the SEA requirements has been completed by 35 key officials in six sectors.

Most departments examined have not established mechanisms to apply the Cabinet directive to proposals going to individual ministers

5.23 We found that two of the five departments we examined have established mechanisms to help ensure that the Cabinet directive is applied to proposals going to their ministers for approval. Natural Resources Canada monitors proposals going to the Minister to determine whether an assessment is required. Transport Canada’s policy requires that the Cabinet directive be applied to all proposals being sent to the Minister. Transport Canada has also provided training to staff with respect to this requirement and tracks performance of its application.

5.24 The remaining departments’ procedures need to be strengthened to ensure that the Cabinet directive is applied to proposals going to ministers. As a result, ministers may not be provided with information on environmental factors associated with the proposal being considered.

5.25 Recommendation. Aboriginal Affairs and Northern Development Canada, Citizenship and Immigration Canada, and Health Canada should review their strategic environmental assessment processes to ensure that the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines are applied to proposals going to their ministers.

Aboriginal Affairs and Northern Development Canada’s response. Agreed. Aboriginal Affairs and Northern Development Canada, like all departments, is taking the necessary steps to ensure that environmental implications and considerations are integrated into proposals submitted to an individual minister or to Cabinet for approval. Specifically, the Department will issue a directive to articulate the existing policy and ensure that its strategic environmental assessment guidance and training includes the consideration of all proposals going to the Minister for approval.

Citizenship and Immigration Canada’s response. Agreed. Citizenship and Immigration Canada has defined “proposals” as memoranda to Cabinet and Treasury Board submissions, and has long-standing processes and mechanisms in place to ensure that proposals have been appropriately assessed pursuant to the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals. The Department will review its processes to assess potential situations where any other proposals would be subject to the Cabinet directive and will benchmark with other departments on their definition of “proposal” to ensure consistency with the Cabinet directive. These measures will be completed by March 2015.

Health Canada’s response. Agreed. Health Canada will review and revise, as required, its Strategic Environmental Assessment Policy, guidance, and training to include consideration of proposals going to the Minister for approval and ensure tools are in place to support the Policy. It is anticipated that this will be completed by 31 March 2015.

Departments have established some good practices in support of their strategic environmental assessment processes

5.26 During our examination, we found that departments had established some good practices to support their strategic environmental assessment process and compliance with the Cabinet directive.

5.27 Sustainable development assessment tools. We found that two departments have sustainable development assessment tools that facilitate an assessment of the broader sustainable development implications of a proposed policy, plan, or program. Citizenship and Immigration Canada has the Sustainable Development Assessment (SDA) tool, which requires officials to consider environmental, economic, and social implications of a proposal, such as effects on climate change and natural resources, employment, labour market, competitiveness, and effects on local infrastructure and future generations. Transport Canada has the Sustainable Transportation Assessment Tool (STAT), a user-friendly computerized program that makes it easier for Transport Canada non-experts to evaluate the social, economic, and environmental implications of proposals at the preliminary scan stage. Both departments have tailored their tools to their specific mandates. The SDA and STAT tools allow officials to move beyond the traditional environmental assessment of policies, plans, and programs to examine the environmental, economic, and social implications in an integrated way.

5.28 Review and control. Natural Resources Canada has established controls to ensure that proposals for Cabinet or Treasury Board approval have been assessed for their environmental effects as required by the Cabinet directive. One such point of control resides with the Chief Financial Officer, who confirms that the proposal has been assessed in accordance with the Cabinet directive.

5.29 Training and awareness sessions. Health Canada, Natural Resources Canada, and Transport Canada invest in strategic environmental assessment training for their staff in order to increase awareness of the Cabinet directive and the requirement to complete strategic environmental assessments.

5.30 Detailed reporting on extent and results of practices. Transport Canada reports comprehensive performance information on the extent and results of its strategic environmental assessment practices in its annual reports on plans and priorities and its departmental performance reports. The Department’s reporting includes

the number of proposals submitted by the Department and approved,
the total number of proposals for which the strategic environmental assessment process was completed, and
the overall strategic environmental assessment compliance expressed as a percentage.

5.31 Quarterly reporting to senior management. Health Canada prepares a quarterly summary report to its senior executives and to the Deputy Minister to track its compliance rate (the number of proposals seeking approval compared with the number of proposals that have undergone a strategic environmental assessment). The summary report highlights successes but also identifies any variance in performance and remedial actions needed.

5.32 Assessment of budget proposals. Natural Resources Canada has integrated strategic environmental assessment into the development of budget proposals submitted to its Minister. The Department begins the assessment early in the budget development process and integrates the conclusions into the final budget proposal.

5.33 Sharing of best practices. Health Canada, Natural Resources Canada, and Transport Canada’s strategic environmental assessment experts help other government departments develop their strategic environmental assessment policy, guidance, and tools.

Central agencies have recently revised their processes to help ensure the Cabinet directive is applied to proposals going to Cabinet or the Treasury Board

5.34 We found that both central agencies have recently improved their mechanisms for helping to ensure application of the Cabinet directive. However, it is too early to tell if the mechanisms will help ensure that departments apply the Cabinet directive, and consider environmental factors, in all proposals going to Cabinet or the Treasury Board.

5.35 Treasury Board of Canada Secretariat. In early 2014, the Secretariat updated its guidance to help departments and agencies prepare Treasury Board submissions. The 2014 Guidance for the Preparation of TB Submissions emphasizes that departments and agencies must consider environmental and sustainable development requirements (including strategic environmental assessment and green procurement) when developing their submissions. When this guidance was released, the Secretariat’s Assistant Secretary, Economic Sector, sent an internal memo to analysts reminding them of strategic environmental assessment requirements. Also in early 2014, the Secretariat introduced a document called Expectations for Strategic Environmental Assessments in TB Submissions, which included a list of questions to help analysts ensure that departments and agencies integrate environmental considerations into their Treasury Board submissions. This list should also help to ensure that the information provided in proposals is coherent and consistent with the Cabinet directive’s guiding principles. In addition to these new measures, the Secretariat continues to provide analysts with annual training sessions that include information on the Federal Sustainable Development Act, the FSDS, and the Cabinet directive.

5.36 As a result of these recent changes, the Secretariat now requires that where a proposal is exempted from strategic environmental assessment, the Treasury Board submission should indicate whether the exemption is based on emergency, urgency, or previous assessment. Also, the Secretariat now requires that if a preliminary scan concludes that there is no potential for important environmental effects associated with the proposal, the Treasury Board submission should reflect this fact. If a strategic environmental assessment is conducted, conclusions of the assessment should be included in the Treasury Board submission.

5.37 Privy Council Office. The Privy Council Office has a document, A Drafter’s Guide to Cabinet Documents, which helps departments and agencies prepare memoranda to Cabinet. In keeping with the Cabinet directive, the guide indicates that sustainable development and results of strategic environmental assessments should be considered in the memorandum, when appropriate. The Privy Council Office has introduced a due diligence checklist that requires analysts to determine if an environmental scan of the proposal was completed by the department, and any positive or negative environmental impacts are noted in the proposal. In early 2014, an official of the Privy Council Office sent a letter to departments and agencies. It reminded them of the Cabinet directive and the need to demonstrate to the Privy Council Office analysts what kind of analysis was completed (preliminary scan or detailed assessment) and what the results were (any positive or negative environmental effects). The letter also stated that if no environmental effects were identified, there is no requirement to include this information in the memorandum.

Results of applying the Cabinet directive

5.38 Overall, we found gaps in applying the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals in relation to conducting strategic environmental assessments, including information on the environmental aspects in proposals to Cabinet or the Treasury Board, and publicly reporting the results of strategic environmental assessment processes. This finding is important because it indicates that environmental implications and considerations are not yet systematically included in policy, plan, and program proposals submitted to Cabinet or the Treasury Board. Without this information, it is difficult for ministers to make informed decisions that support sustainable development.

5.39 We examined a selection of memoranda to Cabinet and Treasury Board submissions to see whether the Cabinet directive was applied and whether environmental implications and considerations were being properly integrated into the proposals. We also examined whether departments were preparing public statements of the environmental effects of a policy, plan, or program that is approved or announced in accordance with the Cabinet directive. Our examination focused on proposals submitted by the five departments during the calendar years 2012 and 2013. We selected these proposals based on a number of factors, including their potential for either positive or negative environmental effects, the likelihood of links to the Federal Sustainable Development Strategy (FSDS), and the importance of the issues to parliamentarians and Canadians. We also examined a selection of preliminary scans (including those directly connected to the selection of proposals we examined) that were completed during this same time period.

Assessments are not going beyond the preliminary scan step

5.40 The Cabinet directive requires that departments and agencies conduct a preliminary scan, at the earliest point in the proposal development process, to determine whether the proposal has the potential for important environmental effects, either positive or negative. If the scan identifies the potential for important environmental effects, the department is required to complete a detailed strategic environmental assessment and include the results of the assessment in the proposal.

5.41 We found that in 2012 and 2013, the five departments we examined completed approximately 250 preliminary scans and only one detailed strategic environmental assessment. Most of these preliminary scans were to support memoranda to Cabinet and Treasury Board submissions. Depending on the department, preliminary scans were also completed for budget submissions, corporate plans, and regulatory initiatives.

5.42 We reviewed 47 preliminary scans to determine if the conclusion not to proceed to a detailed strategic environmental assessment was appropriate. In 21 cases (fewer than half), the proposal was exempted from further analysis for a number of reasons—for example, because the proposal had been assessed previously. In 11 cases, we found that the conclusion in the preliminary scan was appropriate. In the 15 remaining cases (about one third of all the preliminary scans examined), we found that the reasons presented for not proceeding to a detailed strategic environmental assessment were contrary to the expectations of the Cabinet directive. For example, some preliminary scans concluded that a detailed strategic environmental assessment was not required because the proposal would not result in any important environmental effects. However, the preliminary scan showed that the policy, plan, or program proposals could have, in our view, important positive environmental effects or could affect the goals and targets of the FSDS. In other cases, preliminary scans concluding that a detailed strategic environmental assessment was not required contained a significant amount of information or analysis. In our opinion, the preliminary scan is to function as a screening tool for important environmental effects, which would then trigger the more detailed strategic environmental assessment.

5.43 Some preliminary scans did not proceed to detailed strategic environmental assessments when they could have, according to the Cabinet directive. As a result, there is a risk that decision makers are not getting a complete picture of the positive and negative environmental implications of proposals being submitted to them for decision or their potential links to the FSDS. Moreover, there is no requirement to prepare a public statement because detailed strategic environmental assessments are not being conducted.

5.44 Recommendation. Aboriginal Affairs and Northern Development Canada, Citizenship and Immigration Canada, Health Canada, Natural Resources Canada, and Transport Canada should ensure that they are appropriately concluding on the need to complete a detailed strategic environmental assessment when assessing the environmental implications of each policy, plan, and program proposal.

Aboriginal Affairs and Northern Development Canada’s response. Agreed. Aboriginal Affairs and Northern Development Canada will review existing processes to ensure that the Department is appropriately considering, determining, and documenting the need to complete a detailed strategic environmental assessment for each policy, plan, and program proposal destined for Cabinet consideration.

Citizenship and Immigration Canada’s response. Agreed. Citizenship and Immigration Canada has put a process in place to review all preliminary scans to ensure that there is sufficient documentation to support the decision to proceed or to require a full sustainable development assessment. This will support monitoring of departmental compliance with the Cabinet directive. These measures will be completed by March 2015.

Health Canada’s response. Agreed. Health Canada will continue to ensure that the Department is appropriately concluding on the need to complete a detailed strategic environmental assessment when assessing the environmental implications of each policy, plan, and program proposal. It is anticipated that this will be completed by 31 October 2015.

Natural Resources Canada’s response. Agreed. As committed to in the departmental Report on Plans and Priorities and the departmental sustainable development strategy reporting of 2014–15, Natural Resources Canada will continue integration of strategic environmental assessment into its strategic decision-making processes. Specifically, the Department will support ongoing transparency and accountability in its strategic environmental assessment process, including undertaking detailed strategic environmental assessments, as appropriate, and issuing public statements of environmental effects thereafter, as well as encouraging public statements for other levels of strategic environmental assessment, in compliance with the Cabinet directive and its guidelines, the Departmental Directive on Environmental Assessment, and guidance supplied by central agencies.

Transport Canada’s response. Agreed. Transport Canada will amend its Sustainable Transportation Assessment Tool before 31 March 2015 to include a rationale on the final determination of the need for a detailed strategic environmental assessment.

Information on the strategic environmental assessment process is not consistently included in proposals going to Cabinet

5.45 During the audit, we examined a total of 39 proposals (Treasury Board submissions and memoranda to Cabinet) that were submitted to Cabinet and to the Treasury Board by the five departments in 2012 and 2013. We found that 21 of the proposals properly integrated environmental implications and considerations. Of the remaining 18 proposals, we found examples where there was no reference to the Cabinet directive being applied to the proposal. In other cases, we found that the proposal stated that a scan was completed and that no important environmental effects were identified, and yet the proposal outlined important positive environmental effects that are expected to result from the proposed policy, plan, or program. Lastly, several proposals did not reflect how the proposal was likely to affect the achievement of the FSDS goals and targets (such as reducing greenhouse gas emissions), although this information was documented in the preliminary scan prepared for the proposals.

Most departments examined are not making public statements related to preliminary scans

5.46 The Cabinet directive specifically requires departments and agencies to prepare public statements about the environmental effects of all approved or announced policies, plans, and programs for which they have conducted a detailed strategic environmental assessment. Departments and agencies are encouraged to do the same for preliminary scans. We looked at whether the selected departments had reported public statements in accordance with the Cabinet directive.

5.47 As noted in paragraph 5.41, only one detailed strategic environmental assessment was completed by the five departments in 2012 and 2013. Natural Resources Canada completed a detailed strategic environmental assessment in November 2012 in relation to the divestiture of the Dominion Coal Blocks, two parcels of federal land (approximately 20,000 hectares located in the Kootenay region of British Columbia). The Department made an official public announcement in August 2013, which was later followed up with a public statement.

5.48 We found only two instances of public reporting on the results of preliminary scans in 2012 and 2013. These reports came from Natural Resources Canada. The remaining preliminary scans did not generate public statements despite departments being encouraged to do so by the Cabinet directive. In our opinion, reporting publicly on the results of preliminary scans would contribute to making the federal government’s environmental decision-making process more transparent and accountable. Reporting publicly is especially important where the nature of the proposal, the potential effects, the potential for links to the FSDS, or the reasons for not performing a detailed strategic environmental assessment could be of interest to the public.

Conclusion

5.49 We concluded that most of the departments we examined have established the mechanisms necessary to adequately manage their strategic environmental assessment processes and support compliance with the Cabinet Directive on the Assessment of Policy, Plan and Program Proposals. Additionally, central agencies have recently added controls designed to help ensure that the Cabinet directive is applied to memoranda to Cabinet and Treasury Board submissions. Most of the departments we examined have made satisfactory progress toward strengthening the application of the Cabinet directive. By doing so, these selected departments have contributed to the government-wide commitment in the Federal Sustainable Development Strategy.

5.50 However, we concluded that the departments are not ensuring that environmental implications and considerations are systematically integrated into proposals submitted to an individual minister, Cabinet, or the Treasury Board for approval. Only one detailed strategic environmental assessment and one public statement of the results of this assessment were completed by the five departments examined during 2012 or 2013. Additionally, results of preliminary scans were made public in only two instances. Although departments have completed preliminary scans, most are not publicly reporting the results of these scans despite being encouraged to do so by the Cabinet directive.

5.51 Information on the strategic environmental assessment process is not consistently included in proposals going to Cabinet or the Treasury Board. Although the Cabinet directive has been in force for almost 25 years, and in spite of recent commitment to strengthen its application, in the proposals we examined, individual ministers, Cabinet, and the Treasury Board are not systematically receiving information on the environmental implications of policy, plan, or program proposals.

About the Audit

The Office of the Auditor General’s responsibility was to conduct an independent examination of sustainable development strategies to provide objective information, advice, and assurance to assist Parliament in its scrutiny of the government’s management of resources and programs.

All of the audit work in this chapter was conducted in accordance with the standards for assurance engagements set out by the Chartered Professional Accountants of Canada (CPA) in the CPA Canada Handbook—Assurance. While the Office adopts these standards as the minimum requirement for our audits, we also draw upon the standards and practices of other disciplines.

As part of our regular audit process, we obtained management’s confirmation that the findings reported in this chapter are factually based.

Objective

The objective of this audit was to determine whether selected departments and agencies have mechanisms in place to ensure compliance with key aspects of the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines, and to ensure that environmental implications and considerations are integrated into proposals submitted to an individual minister or Cabinet for approval.

Scope and approach

As part of our annual monitoring of sustainable development strategies, we focused our audit on the mechanisms and documents developed in the following entities:

Aboriginal Affairs and Northern Development Canada,
Citizenship and Immigration Canada,
Health Canada,
Natural Resources Canada,
Privy Council Office,
Transport Canada, and
Treasury Board of Canada Secretariat.

We concentrated our audit on the mechanisms that departments and agencies have in place to support compliance with the Cabinet directive. We also examined whether decision makers are receiving adequate information on the environmental implications of their decisions. We did not examine the completeness or reasonableness of details in public statements related to strategic environmental assessments.

Our work consisted of analysis of documentation and discussion with entity officials.

Our audit applies only to the commitments we examined and does not necessarily represent the overall progress made by each entity in implementing its sustainable development strategy or in contributing to meeting the Federal Sustainable Development Strategy targets.

Our audit did not examine the Department of Finance Canada because it has only budgetary responsibility for applying the Cabinet directive.

Criteria

To determine whether selected departments and agencies have mechanisms in place to ensure compliance with key aspects of the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines, and to ensure that environmental implications and considerations are integrated into proposals submitted to an individual minister or Cabinet for approval, we used the following criteria:

Criteria	Sources
Selected departments have mechanisms in place to support compliance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines. Specific mechanisms include defined roles and responsibilities regarding the application of the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals; guidance on when and how to apply the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals; tools or methodologies to support the application of the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals; tracking mechanisms; reporting mechanisms that ensure that departments report publicly on the extent and results of their strategic environmental assessment practices in their departmental performance reports; reporting mechanisms that ensure that public statements of environmental effects are easily accessible to the public and include a description of how the proposal has affected, or is expected to affect, progress toward the Federal Sustainable Development Strategy goals and targets; and reporting mechanisms that ensure that when a strategic environmental assessment was not warranted as a result of a preliminary scan, departments have prepared a public statement stating that no important environmental effects were identified.	Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines Planning for a Sustainable Future: A Federal Sustainable Development Strategy for Canada, 2013–2016, Environment Canada Guidance for the department website component of Sustainable Development and Strategic Environmental Assessment reporting, 2011–12 Report on Plans and Priorities, Environment Canada, Sustainable Development Office Guidance for departmental website component for Departmental Sustainable Development Strategy, 2012–2013 Performance Reporting and Strategic Environmental Assessment Reporting, Environment Canada, Sustainable Development Office
Proposals submitted to Cabinet for approval properly integrate environmental implications and considerations. Proposals do one of the following: indicate that a preliminary scan has been completed and that no important environmental effects, either positive or negative, were identified with the proposal; or contain the results of a strategic environmental assessment. Where a strategic environmental assessment has been completed: the scope of the environmental considerations analysis presented in the proposals is commensurate with the level of anticipated environmental effects; the proposal includes an explanation of how the proposal could affect the achievement of Federal Sustainable Development Strategy goals and targets, when appropriate; and public concerns are presented, when appropriate.	Canadian Environmental Protection Act, 1999 Federal Sustainable Development Act Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines Decision-Making Processes and Central Agencies in Canada: Federal, Provincial and Territorial Practices, Privy Council Office A Guide to Preparing Treasury Board Submissions (2007) and Treasury Board Submission Form, Treasury Board of Canada Secretariat A Drafter’s Guide to Cabinet Documents, 2012, and Memorandum to Cabinet template, Privy Council Office
The Privy Council Office has mechanisms in place to help ensure that environmental implications and considerations have been integrated in the Memoranda to Cabinet submitted to Cabinet for approval. The Treasury Board of Canada Secretariat has mechanisms in place to help ensure that environmental implications and considerations have been integrated in the Treasury Board submissions submitted to Cabinet for approval.	Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines Canadian Environmental Protection Act, 1999 Federal Sustainable Development Act Planning for a Sustainable Future: A Federal Sustainable Development Strategy for Canada, 2013–2016, Environment Canada

Criteria

Sources

Selected departments have mechanisms in place to support compliance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines. Specific mechanisms include

defined roles and responsibilities regarding the application of the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals;
guidance on when and how to apply the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals;
tools or methodologies to support the application of the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals;
tracking mechanisms;
reporting mechanisms that ensure that departments report publicly on the extent and results of their strategic environmental assessment practices in their departmental performance reports;
reporting mechanisms that ensure that public statements of environmental effects are easily accessible to the public and include a description of how the proposal has affected, or is expected to affect, progress toward the Federal Sustainable Development Strategy goals and targets; and
reporting mechanisms that ensure that when a strategic environmental assessment was not warranted as a result of a preliminary scan, departments have prepared a public statement stating that no important environmental effects were identified.

Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines
Planning for a Sustainable Future: A Federal Sustainable Development Strategy for Canada, 2013–2016, Environment Canada
Guidance for the department website component of Sustainable Development and Strategic Environmental Assessment reporting, 2011–12 Report on Plans and Priorities, Environment Canada, Sustainable Development Office
Guidance for departmental website component for Departmental Sustainable Development Strategy, 2012–2013 Performance Reporting and Strategic Environmental Assessment Reporting, Environment Canada, Sustainable Development Office

Proposals submitted to Cabinet for approval properly integrate environmental implications and considerations.

Proposals do one of the following:

indicate that a preliminary scan has been completed and that no important environmental effects, either positive or negative, were identified with the proposal; or
contain the results of a strategic environmental assessment.

Where a strategic environmental assessment has been completed:

the scope of the environmental considerations analysis presented in the proposals is commensurate with the level of anticipated environmental effects;
the proposal includes an explanation of how the proposal could affect the achievement of Federal Sustainable Development Strategy goals and targets, when appropriate; and
public concerns are presented, when appropriate.

Canadian Environmental Protection Act, 1999
Federal Sustainable Development Act
Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines
Decision-Making Processes and Central Agencies in Canada: Federal, Provincial and Territorial Practices, Privy Council Office
A Guide to Preparing Treasury Board Submissions (2007) and Treasury Board Submission Form, Treasury Board of Canada Secretariat
A Drafter’s Guide to Cabinet Documents, 2012, and Memorandum to Cabinet template, Privy Council Office

The Privy Council Office has mechanisms in place to help ensure that environmental implications and considerations have been integrated in the Memoranda to Cabinet submitted to Cabinet for approval.

The Treasury Board of Canada Secretariat has mechanisms in place to help ensure that environmental implications and considerations have been integrated in the Treasury Board submissions submitted to Cabinet for approval.

Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines
Canadian Environmental Protection Act, 1999
Federal Sustainable Development Act
Planning for a Sustainable Future: A Federal Sustainable Development Strategy for Canada, 2013–2016, Environment Canada

Management reviewed and accepted the suitability of the criteria used in the audit. However, the Privy Council Office did not agree with the audit’s underlying premise that references must be made in all memoranda to Cabinet to environmental considerations, regardless of whether they exist or are pertinent. Regardless of whether a preliminary scan or detailed strategic environmental assessment was completed, we expected that results of the strategic environmental assessment process would be included in proposals presented to Cabinet or Treasury Board. We included this as a criterion to ensure that decision makers were informed of the results of the application of the directive.

Period covered by the audit

The audit covered activities and documentation prepared between September 2010 and June 2014. Audit work for this chapter was completed on 30 June 2014.

Audit team

Principal: Jim McKenzie
Director: Kari Swarbrick

Hélène Charest
Christianne Curry
Marie Duchaîne
Mark Lawrence

For information, please contact Communications at 613-995-3708 or 1-888-761-5953 (toll-free).
Hearing impaired only TTY: 613-954-8042

Appendix—List of recommendations

The following is a list of recommendations found in Chapter 5. The number in front of the recommendation indicates the paragraph number where it appears in the chapter. The numbers in parentheses indicate the paragraph numbers where the topic is discussed.

Mechanisms to apply the Cabinet directive

Recommendation	Response
5.22 Aboriginal Affairs and Northern Development Canada should update its strategic environmental assessment process to ensure compliance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines. (5.20–5.21)	The Department’s response. Agreed. Aboriginal Affairs and Northern Development Canada has already developed and implemented a comprehensive plan to ensure compliance with the directive. During the audit period, departmental strategic environmental assessment (SEA) guidance documents, tools, and processes have been reworked to reflect the changes to the 2010 Cabinet directive, as follows: Roles and responsibilities, linkages to the FSDS, and clear reflection of public statements and Departmental Performance Report reporting requirements have been updated. The Cabinet Proposal Checklist, required before the drafting of a Cabinet proposal, has been updated to specify requirements to complete the strategic environmental assessment/gender-based analysis/Official Languages Act forms, which are mandatory for all Cabinet documents prepared in the Department. It should be noted that the Department’s checklists include Treasury Board submissions and memoranda to Cabinet. The critical path document has been updated to emphasize the need to complete the amalgamated strategic environmental assessment/gender-based analysis/Official Languages Act forms document at the outset of any Cabinet document process, with links to appropriate resources. Completion status of SEAs and other compulsory analyses have been embedded in the development and tracking of Cabinet documents. Cabinet Affairs’ internal tracking system tracks each Cabinet proposal presented to Cabinet committees and will include the Comprehensive Integrated Document Management system number for its respective strategic environmental assessment/gender-based analysis/Official Languages Act forms. All Cabinet proposals presented at the Director General Policy Committee are required to submit completed and approved strategic environmental assessment, gender-based analysis, and Official Languages Act analyses to be included in the discussion; the minutes of each meeting will confirm their completion as well as any related comments. In addition, training to complete the SEA requirements has been completed by 35 key officials in six sectors.
5.25 Aboriginal Affairs and Northern Development Canada, Citizenship and Immigration Canada, and Health Canada should review their strategic environmental assessment processes to ensure that the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines are applied to proposals going to their ministers. (5.23–5.24)	Aboriginal Affairs and Northern Development Canada’s response. Agreed. Aboriginal Affairs and Northern Development Canada, like all departments, is taking the necessary steps to ensure that environmental implications and considerations are integrated into proposals submitted to an individual minister or to Cabinet for approval. Specifically, the Department will issue a directive to articulate the existing policy and ensure that its strategic environmental assessment guidance and training includes the consideration of all proposals going to the Minister for approval. Citizenship and Immigration Canada’s response. Agreed. Citizenship and Immigration Canada has defined “proposals” as memoranda to Cabinet and Treasury Board submissions, and has long-standing processes and mechanisms in place to ensure that proposals have been appropriately assessed pursuant to the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals. The Department will review its processes to assess potential situations where any other proposals would be subject to the Cabinet directive and will benchmark with other departments on their definition of “proposal” to ensure consistency with the Cabinet directive. These measures will be completed by March 2015. Health Canada’s response. Agreed. Health Canada will review and revise, as required, its Strategic Environmental Assessment Policy, guidance, and training to include consideration of proposals going to the Minister for approval and ensure tools are in place to support the Policy. It is anticipated that this will be completed by 31 March 2015.

Recommendation

Response

5.22 Aboriginal Affairs and Northern Development Canada should update its strategic environmental assessment process to ensure compliance with the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines. (5.20–5.21)

Roles and responsibilities, linkages to the FSDS, and clear reflection of public statements and Departmental Performance Report reporting requirements have been updated.
The Cabinet Proposal Checklist, required before the drafting of a Cabinet proposal, has been updated to specify requirements to complete the strategic environmental assessment/gender-based analysis/Official Languages Act forms, which are mandatory for all Cabinet documents prepared in the Department. It should be noted that the Department’s checklists include Treasury Board submissions and memoranda to Cabinet.
The critical path document has been updated to emphasize the need to complete the amalgamated strategic environmental assessment/gender-based analysis/Official Languages Act forms document at the outset of any Cabinet document process, with links to appropriate resources.
Completion status of SEAs and other compulsory analyses have been embedded in the development and tracking of Cabinet documents. Cabinet Affairs’ internal tracking system tracks each Cabinet proposal presented to Cabinet committees and will include the Comprehensive Integrated Document Management system number for its respective strategic environmental assessment/gender-based analysis/Official Languages Act forms.
All Cabinet proposals presented at the Director General Policy Committee are required to submit completed and approved strategic environmental assessment, gender-based analysis, and Official Languages Act analyses to be included in the discussion; the minutes of each meeting will confirm their completion as well as any related comments.
In addition, training to complete the SEA requirements has been completed by 35 key officials in six sectors.

5.25 Aboriginal Affairs and Northern Development Canada, Citizenship and Immigration Canada, and Health Canada should review their strategic environmental assessment processes to ensure that the Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals and its related guidelines are applied to proposals going to their ministers. (5.23–5.24)

Results of applying the Cabinet directive

Recommendation	Response
5.44 Aboriginal Affairs and Northern Development Canada, Citizenship and Immigration Canada, Health Canada, Natural Resources Canada, and Transport Canada should ensure that they are appropriately concluding on the need to complete a detailed strategic environmental assessment when assessing the environmental implications of each policy, plan, and program proposal. (5.40–5.43)	Aboriginal Affairs and Northern Development Canada’s response. Agreed. Aboriginal Affairs and Northern Development Canada will review existing processes to ensure that the Department is appropriately considering, determining, and documenting the need to complete a detailed strategic environmental assessment for each policy, plan, and program proposal destined for Cabinet consideration. Citizenship and Immigration Canada’s response. Agreed. Citizenship and Immigration Canada has put a process in place to review all preliminary scans to ensure that there is sufficient documentation to support the decision to proceed or to require a full sustainable development assessment. This will support monitoring of departmental compliance with the Cabinet directive. These measures will be completed by March 2015. Health Canada’s response. Agreed. Health Canada will continue to ensure that the Department is appropriately concluding on the need to complete a detailed strategic environmental assessment when assessing the environmental implications of each policy, plan, and program proposal. It is anticipated that this will be completed by 31 October 2015. Natural Resources Canada’s response. Agreed. As committed to in the departmental Report on Plans and Priorities and the departmental sustainable development strategy reporting of 2014–15, Natural Resources Canada will continue integration of strategic environmental assessment into its strategic decision-making processes. Specifically, the Department will support ongoing transparency and accountability in its strategic environmental assessment process, including undertaking detailed strategic environmental assessments, as appropriate, and issuing public statements of environmental effects thereafter, as well as encouraging public statements for other levels of strategic environmental assessment, in compliance with the Cabinet directive and its guidelines, the Departmental Directive on Environmental Assessment, and guidance supplied by central agencies. Transport Canada’s response. Agreed. Transport Canada will amend its Sustainable Transportation Assessment Tool before 31 March 2015 to include a rationale on the final determination of the need for a detailed strategic environmental assessment.

Recommendation

Response

5.44 Aboriginal Affairs and Northern Development Canada, Citizenship and Immigration Canada, Health Canada, Natural Resources Canada, and Transport Canada should ensure that they are appropriately concluding on the need to complete a detailed strategic environmental assessment when assessing the environmental implications of each policy, plan, and program proposal. (5.40–5.43)

PDF Versions

To access the Portable Document Format (PDF) version you must have a PDF reader installed. If you do not already have such a reader, there are numerous PDF readers available for free download or for purchase on the Internet:

Language selection

Search and menus

Search

2014 Fall Report of the Commissioner of the Environment and Sustainable Development Chapter 5—Departmental Progress in Implementing Sustainable Development Strategies

2014 Fall Report of the Commissioner of the Environment and Sustainable Development
Chapter 5—Departmental Progress in Implementing Sustainable Development Strategies

Table of Contents

Performance audit reports

Introduction

Importance of strategic environmental assessments

The Cabinet Directive on the Environmental Assessment of Policy, Plan and Program Proposals

Exhibit 5.1—Factors to consider when assessing environmental effects

Responsibilities in applying the Cabinet directive

Previous audits

Focus of the audit

Observations and Recommendations

Mechanisms to apply the Cabinet directive

Most departments examined have mechanisms to apply the Cabinet directive to proposals going to Cabinet

Exhibit 5.2—Most departments are contributing to the FSDS commitment to strengthen application of the Cabinet directive and related guideline

Most departments examined have not established mechanisms to apply the Cabinet directive to proposals going to individual ministers

Departments have established some good practices in support of their strategic environmental assessment processes

Central agencies have recently revised their processes to help ensure the Cabinet directive is applied to proposals going to Cabinet or the Treasury Board

Results of applying the Cabinet directive

Assessments are not going beyond the preliminary scan step

Information on the strategic environmental assessment process is not consistently included in proposals going to Cabinet

Most departments examined are not making public statements related to preliminary scans

Conclusion

About the Audit

Objective

Scope and approach

Criteria

Period covered by the audit

Audit team

Appendix—List of recommendations

Mechanisms to apply the Cabinet directive

Results of applying the Cabinet directive

PDF Versions