Review of Financial Administration Act
February 10, 2004
Ottawa, Ontario
BACKGROUNDER
The Report of the Auditor General tabled today identifies a number of issues involving the financial controls and application of the Financial Administration Act (FAA).
Key issues identified by the Auditor General include actions by certain officials who:
- Knowingly participated in the mismanagement of public funds;
- Contravened rules and regulations stipulated by the FAA; and
- Failed to take reasonable steps to protect the interests of the Crown.
In response, the government has announced that it will review and strengthen the FAA as part of its efforts to increase oversight and accountability, identify problems earlier, and enhance its ability to take corrective and/or disciplinary action in cases where there is wrongdoing.
The review will seek to:
- Clarify and strengthen administrative and criminal sanctions for wrongdoing;
- Enhance administrative authorities to investigate cases of malfeasance. Current procedures must largely rely on the voluntary participation of individuals being investigated. The review will assess ways to strengthen investigative authorities, including examining options to obtain information from employees, codifying employees’ obligations to cooperate in investigations, obtaining information under oath, and looking at rules to govern confidentiality during investigations;
- Extend sanctions so that they apply to former public servants, employees of Crown Corporations and public office holders. At present, no action can be taken once the employment relationship has terminated, even for individuals in receipt of government pensions, other than penalties associated with criminal conviction; and
- Strengthen provisions for financial recoveries. Current provisions are complex and difficult to successfully apply.
The review will also seek to determine whether Treasury Board policies, guidelines and the management framework governing discipline within the public service can be strengthened to ensure they are clearly understood, and better monitored and applied. This will be critical when provisions of the Public Service Modernization Act delegating authority for discipline to deputy ministers come into force.
This review of the FAA will commence immediately and will be led by the President of the Treasury Board. The Treasury Board Secretariat has been directed to identify, as quickly as possible, any corrective measures that can be implemented in the short term through changes in administrative management policies. The Secretariat is to report on recommendations that require legislative change no later than September 30, 2004.
In carrying out this review, the government will seek the views of parliamentarians, the Auditor General, unions, and other interested parties.
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