Ministry of
Agriculture, Food and Rural Affairs
Mr Frank Ingratta, Deputy Minister
Mr David Hope, director, policy analysis branch, policy and farm
finance division
STANDING COMMITTEE ON
PUBLIC ACCOUNTS
Chair /
Président
Mr John Gerretsen (Kingston and the Islands / Kingston et les
îles L)
Vice-Chair / Vice-Président
Mr John C. Cleary (Stormont-Dundas-Charlottenburgh L)
Mr John C. Cleary (Stormont-Dundas-Charlottenburgh L)
Mr John Gerretsen (Kingston and the Islands / Kingston et les
îles L)
Mr John Hastings (Etobicoke North / -Nord PC)
Ms Shelley Martel (Nickel Belt ND)
Mr Bart Maves (Niagara Falls PC)
Mrs Julia Munro (York North / -Nord PC)
Ms Marilyn Mushinski (Scarborough Centre / -Centre PC)
Mr Richard Patten (Ottawa Centre / -Centre L)
Substitutions / Membres remplaçants
Mr Steve Peters (Elgin-Middlesex-London L)
Also taking part / Autres participants et
participantes
Mr Richard Patten (Ottawa Centre / -Centre L)
Mr Erik Peters, Provincial Auditor
Clerk / Greffière
Ms Tonia Grannum
Staff / Personnel
Mr Ray McLellan, research officer, Research and Information
Services
The committee met at 1037 in committee room 1
following a closed session.
SPECIAL REPORT, PROVINCIAL AUDITOR
MINISTRY OF AGRICULTURE, FOOD AND RURAL AFFAIRS
Consideration of chapter
3(3.01), Agricorp.
The Chair (Mr John
Gerretsen): I call to order the meeting of the standing
committee on public accounts dealing with the special report of
the Provincial Auditor relating to Agricorp today. I'd like to
welcome everyone here. Good morning. Perhaps before you make your
presentation, which I would ask you to limit to no more than
between 10 and 15 minutes, but 15 at the outside limit so it
would allow each caucus 20 minutes for questioning, you could
identify yourself and the other members in your delegation as
well. We can start from there.
Mr Frank
Ingratta: Good morning. I'm Frank Ingratta. I'm the
Deputy Minister of Agriculture, Food and Rural Affairs. With me
today I have Dr Bruce Archibald, who is the assistant deputy
minister of the policy and farm finance division, and Mr David
Hope, who is the director within that division. If that
introduction is satisfactory, I will move to the opening
comments.
The Chair:
Go ahead, sir.
Mr Ingratta:
Thank you for providing me with the opportunity today to talk
about an agency that provides excellent service to Ontario's
agri-food industry. It's extremely important to use this time to
clear up any concerns and misunderstandings that may still
surround the agency's performance as a result of the Provincial
Auditor's report. That's why for my opening remarks I'd like to
take you through the history and role of Agricorp and some of the
services it provides. I'll then talk briefly about the recent
Provincial Auditor's report and the corrective actions that the
board and the ministry took as soon as the problems were
identified.
After a year of consulting
with Ontario growers and food processors, Agricorp was launched
in January 1997. The goal was to provide responsive,
cost-effective agricultural insurance and consulting services,
including crop grading and inspection, to Ontario's agriculture
and food industry. For the preceding 31 years, crop insurance had
been provided by the Ministry of Agriculture. While the service
delivery had been good, it was felt that an arm's-length
organization with farmer representation on the board of directors
would be more responsive and more efficient.
A memorandum of understanding
reached between the new agency and the ministry set out the terms
of the transfer. As you may know, Agricorp, like all other
agencies, is established by government but is not part of it. The
agency was created by legislation and was assigned responsibility
and authority for carrying out risk management programs on behalf
of the Ontario and federal governments.
The agency has the freedom to
seek out new business, as well as operating efficiencies within
the ongoing programs. The ministry retains overall responsibility
for strategic directions.
As you may know, crop
insurance protects farmers against severe natural events. It is
an extremely important risk management tool that Agricorp
delivers to more than 19,000 Ontario farmers who grow 54
different crops. Financing for the program comes from premiums:
growers pay half of the premium costs, and the federal and
provincial governments pick up the other half, as well as picking
up the administrative costs of the program.
Agricorp demonstrates its
commitment to customer service and efficiency in the delivery of
this program. In each of the last two years, the acreage covered
under the crop insurance program administered by Agricorp has
increased by 6%. At the same time as that increase in coverage,
premium prices fell for most field crops and were reduced by
approximately 20%, resulting in savings of more than $30 million
to farmers for the 1999 and 2000 crop years combined.
Crop insurance is only one of
a number of safety net programs available to farmers. Agricorp
also delivers, on behalf of the federal and provincial
governments, the market revenue program. Ontario is the only
province in the country to offer grain and oilseed producers this
protection against income reductions due to market fluctuations
and low commodity prices. Again, the agency has proven its
mettle, with more than 22,000 farmers enrolled in this program,
accounting for 85% of the acreage grown across the province. This
year it is expected to distribute approximately $125 million in
market revenue claims.
Agricorp also provides
business and consulting services for various Ontario commodities.
Shortly after its launch,
the agency won a contract to provide third-party grading,
inspection and acreage measurement for several vegetable crops
for the Ontario Vegetable Growers' Marketing Board and the
Ontario Food Processors' Association. It also provides inspection
services to the Flue-Cured Tobacco Growers' Marketing Board and
licensing and inspection of grain elevators and dealers under the
grain financial protection program.
Perhaps the most impressive
of Agricorp's achievements is its ability to provide much-needed
funding very quickly and very efficiently. When the ice storm of
1998 ripped through eastern Ontario, Agricorp delivered, on
behalf of the Ontario government, more than $9 million in
emergency assistance to close to 6,000 farmers and rural
residents in record time; in fact, before the end of January
1999. Agricorp was cutting cheques that were in the hands of
those who needed it most well before the cleanup was complete in
that difficult situation.
Just a year later, Agricorp
jumped into action again. If you will recall, in December 1998
and January 1999, many farmers across Ontario, and particularly
hog producers, were dealing with record low prices. Ontario was
the first jurisdiction in the country to respond, with the
$40-million whole farm relief program. Agricorp was there to make
sure the cheques got into the hands of those who needed them
most. From an announcement in December to mid-January, the
ministry made sure that 60,000 producers had their applications
in hand, and by February 4, Agricorp made sure the first cheques
were in the mail to those producers in financial hardship. By
April 8, 1999, the thousandth cheque was issued and more than $9
million in much-needed financial assistance had already reached
Ontario farmers. The first payment on the federal portion of the
program was not forwarded until July of that year.
Agricorp is an innovative
agency dedicated to continuously improving its services to
Ontario's agri-food industry and farmers. As a three-year-old
agency, Agricorp was chosen to have a value-for-money audit
performed by the Provincial Auditor. A financial audit is
conducted by that office every year under the legislation that
created the agency in the first place.
Last year, inappropriate
decisions were made by the organization which were documented in
the recent auditor's report. As was pointed out in the responses
to the report, we acted quickly to make sure that the board of
directors took immediate steps to rectify the situation and put
in place stricter financial policies and controls. While the
losses are regrettable, the way in which they were dealt with was
swift, sure and aimed at making sure nothing like this happens
again.
Some of the most important
changes that have been made include tighter controls, a new
policy on investments and stricter oversight by the board on all
financial matters.
While by law we are
maintaining an arm's-length relationship, the ministry has also
stepped up its role in Agricorp. We changed the ex-officio member
on the board to a voting ministry representative. We have a
closer relationship with the agency in which the chief executive
administrative officer of the agency and the ministry's assistant
deputy minister in charge meet on a monthly basis. We've devoted
more of our own ministry's internal audit time to the agency.
The inappropriate actions
that occurred last year are regrettable but shouldn't be allowed
to overshadow the tremendous contribution Agricorp makes to the
agri-food industry and to the entire province. Procedures and
policies are now firmly in place that will prevent such a
situation from happening again.
Much of the reason Agricorp
has been able to distinguish itself in terms of excellent service
and innovative solutions is the fact that it is run by farmers
for farmers. The strong representation on the board from
Ontario's farm and commodity groups ensures the agency continues
to evolve to meet the real needs of farmers. With its strong
board of directors, new policies and closer ties to the ministry,
I'm confident that Agricorp is well positioned to continue to
play a significant part in encouraging a vibrant agri-food
industry in Ontario, now and into the future.
The Chair:
Thank you very much, Deputy. We will start off with the first
round of 20-minute questioning for each caucus. There may be some
more time left after that which will be split. We'll start with
the Liberal caucus.
Mr John C. Cleary
(Stormont-Dundas-Charlottenburgh): I just want to know
how someone gets appointed to the board and who is responsible
for nominating them.
Mr Ingratta:
To the board of directors of Agricorp?
Mr Cleary:
Right.
Mr Ingratta:
We seek nominations from the agricultural commodity
organizations, the major organizations that have their crops
insured by the commission. They nominate a list of
individuals-producers-to the ministry, and the selection and the
appointment to the board of directors is made by the
minister.
Mr Cleary:
You said that the commodity groups have to put the names
forward-in all cases?
Mr Ingratta:
The commodity groups put the majority of the names forward. Each
commodity group puts forward two or three names, so we do have
quite an extensive list.
Mr Cleary:
Does the same thing apply to how replacements are chosen?
Mr Ingratta:
On a regular basis we go to the commodity boards to have them
update their lists and their recommendations for who should be on
the board.
Mr Cleary:
The other thing that I'd like to know is a little bit about your
administrator, Tom Schmidt. I'm reading from a fax I got from
probably as good a farmer as there is in the province of Ontario.
It says, "Go back to the time when Schmidt was hired and I think
you will find out that he got rid of the people in Agricorp who
had any knowledge and background in farming and replaced them
with people who didn't know a combine from an airplane." This is
some information I got from a good, well-known farmer.
Ms Marilyn Mushinski (Scarborough
Centre): Are you prepared to hand that over to the
members of the committee?
Mr Ingratta:
The question, sir?
Mr Cleary: I
just wanted your comments on that.
Mr Ingratta:
The question, as I understand it, was how the CEO was hired?
Mr Cleary:
Right.
Mr Ingratta:
Let me provide you that detail, if I might. The interim board of
directors, the transition board of directors from the crop
insurance commission to Agricorp, was charged with the
responsibility of a competition to fill that position. They
acquired the service of a professional human resources firm that
did the search Canada-wide to identify a potential list of
individuals who may be considered for that position. I believe
there were over 100 individuals identified as part of that public
advertisement and by the search conducted by that firm.
1050
The firm, working with the
interim board, determined a short list of individuals who would
be screened through a personal interview and through reference
checks. I believe that five individuals were interviewed by that
board in the first round. If you like, I could provide the names
of the people on the board. They were all producers and the
former chairman of the crop insurance commission. They conducted
that series of interviews, reduced the number of applicants to
three and conducted another intensive series of interviews.
I apologize if this sounds
like a long answer, but I think a full process for identifying
candidates was employed in terms of interviews and reference
checks. As part of that process, the board made the
recommendation to acquire the services of that individual.
The point I believe you are
also making, if I might, is that when that individual came to the
organization, some organizational changes took place. As with any
new organization, restructuring from the old crop insurance
commission did take place. Some of the most senior individuals
who worked with the crop insurance commission and moved from that
to the agency responsibility did continue with the Agricorp
organization and, in fact, continue today.
If there are one or two
examples of individuals who are no longer with the board who may
be in the category of having tremendous experience, I would agree
that in the last three years, individuals have found alternate
employment opportunities or retired. One of the more
long-standing individuals responsible for sales and marketing
retired just last month, and there are a number of cases of that
over the course of the three years. To suggest there was a
complete reshuffling of senior responsibilities with Agricorp
would be incorrect. Some of those senior people continue in those
positions.
Mr Cleary: I
appreciate your comments. It's not my work; it's someone else I
have to represent. Ever since I came to Queen's Park, I have been
involved as either a critic in agriculture or a parliamentary
assistant, so I have to have answers too. I appreciate your
comments, and I know that everyone has a lot of questions.
Mr Steve Peters
(Elgin-Middlesex-London): I understand that Agricorp is
a schedule 3 corporation that has an OMAFRA adviser on the board.
It strikes me as odd that we have four witnesses here today, Mr
Ingratta. Why is nobody from Agricorp-either the chairman or a
member of the board-here today?
Mr Ingratta:
The invitation I received to be present here suggested that the
ministry's activities were to be scrutinized as a result of the
Provincial Auditor's report. I have no question that if we were
to phone the current CEO of Agricorp or members of its board-if
we were to bring them in, they would come willingly. It's not an
issue of excluding them on purpose.
I believe David Hope would
like to add to that, if he might.
Mr David
Hope: I am the current ministry representative on the
board of directors, so I serve as a full voting board member.
Mr Ingratta:
If I might, I'd like to point out that this was one of the
changes made following the Provincial Auditor's report. Rather
than having a ministry representative on the board in an
ex-officio advisory capacity, we moved to have a ministry
employee appointed to the board as a full-time voting member. As
Dave has indicated, he is that person.
Mr Steve
Peters: Being a member of the board and having served, I
guess, back a time in an advisory role on that board, you
certainly would have been privy to what was going on at the board
and you would have known everything that was going on. We know
that in May-June 1999 the auditor made the decision to undertake
a value-for-money audit. During that May-June 1999 period, would
the minister have been communicated with? Would the minister have
been kept informed of everything that was happening at the
Agricorp board during that May-June period when the decision was
made to undertake the audit?
Mr Ingratta:
In answer to your question, I think we have to look at the
structure that was set up. Agricorp was created as an
arm's-length agency. Responsibility for the operation of that
agency was in the hands of the senior management of the agency
and the board. When you ask if the minister was informed of
everything that was happening at the board and the subcommittees
of the board, of the daily and monthly decisions that were taken
at that board, the answer would be no. As the ministry, we
continue to have responsibility for the overall policy direction
of Agricorp but not the daily operational activities.
Were we cognizant of the
decision of the Provincial Auditor to do a value-for-money audit?
Yes. We're also extremely cognizant that in the legislation, the
Provincial Auditor has the annual responsibility of the financial
audit. So we were not surprised or taken aback that with a
relatively new agency with almost three years under its belt, the
Provincial Auditor made the decision to conduct that audit, based
on their financial audits and based on their risk analysis that
is conducted on a broad range of organizations.
Mr Steve Peters: You have an OMAFRA
adviser on the board. It's clear to me that if some serious
discrepancies have taken place with money, somebody should be
notifying the minister of problems within this agency, because
you have an OMAFRA adviser sitting on the board.
Mr Ingratta:
I think we would confirm that when we, as the ministry, became
aware of the issues, that information was shared. You're focusing
on the summer of 1999. I would say to you-and I repeat-that the
board structure that was in place at that time allowed for
multiple committees of the board. Our representative was not an
adviser to all those committees and subcommittees, and so would
not be advised of all the discussions of those subcommittees.
When we became aware of the information through our
representation on the board, that information was dealt with in
due process.
Mr Steve
Peters: In the auditor's report on pages 26 and 27, the
auditor makes reference to a number of investments, including the
bonds that were sold for a $61,000 loss and the loss of $1.2
million on another bond-the top-up of $2.9 million and the
long-term $61,000 loss. As the senior administrator to the whole
farm relief program, Mr Hope, knowing that Agricorp used whole
farm relief money, what was your comment on Agricorp using whole
farm relief money in these investments? Did you agree with
that?
Mr Ingratta:
If I could introduce the first part of the answer, then David
would follow up.
On the question of using the
float that was in Agricorp's control, the float was there to pay
applications to the whole farm program. When those applications
were submitted and approved, Agricorp would cut the cheque. The
indication and the rules, if you will, around how that float
could be invested were clear. They were to be invested for a
limited time and not for an extended period. So it was an
inappropriate action to invest dollars from the whole farm
program for a longer period of time.
1100
Mr Hope:
What I can tell you from our perspective as contracting with
Agricorp to make the payments on whole farm relief is that we
entered into an agreement with Agricorp on how those monies would
be managed and invested and what our expectations of that were.
When the issue became known to the board, at that time I was not
a representative on the board but was made aware of that at the
time it was made known to the board and was also informed about
the actions that had been taken by the board to ensure that there
was no ongoing impact on the program. We also had discussions to
understand the actions that had taken place at the board's
direction to ensure that similar circumstances could not happen
again and we made ourselves familiar with those policies to
ensure that this was sufficient to provide us with assurance that
it would not happen again.
Mr Ingratta:
If I might summarize, the longer-term investment was deemed to be
inappropriate. Again, we have, at the Provincial Auditor's
advice, taken a number of steps to ensure that this practice does
not happen in the future.
Mr Steve
Peters: Can you tell me the size of that bond and the
term of that bond? It's my understanding that the bond had been
sold in two lots on September 15 and September 30, 1999. Could
you tell me what the size of the bond was and what the terms of
that were? How much of that bond was made up by whole farm relief
program funds?
Mr Ingratta:
For clarification, this is the May 1999 bond?
Mr Steve
Peters: Yes.
Mr Ingratta:
David, do you have that information?
Mr Hope:
Just one moment, please.
The Chair: I
think it's right at the bottom of page 26.
Mr Hope:
Yes. In May 1999, a $5-million par value government of Canada
bond with a maturity date of September 1, 2003, was purchased.
That's my understanding.
Mr Steve
Peters: It's interesting. I was elected in June 1999. My
office started to receive calls, complaints started coming in
about the whole farm relief program. Prior to the election, funds
seemed to be disbursed quickly. The release of the funds appears
to have dried up in the summer. Can you tell me, is it because
monies were invested in these bonds that funds couldn't be
released, because the money had been tied up and you didn't have
access to the money?
Mr Ingratta:
David, if I might. I want to make a point, and David will provide
the details.
The issue that I believe
we're discussing today is Agricorp's management of those cheques.
I don't believe the Provincial Auditor had questions about the
process of the cheques being cut and provided to producers. If
the questions you're asking are around the structure and how the
Ontario whole farm relief program was constructed, the policy
decisions that were taken with the federal government and all of
the provinces together to identify how the program would be
constructed-if you want to get into that debate around the
structure of the whole farm program, that's a separate issue. I'd
be glad to provide information on that, but if the questions are
around how Agricorp delivered those cheques, I don't believe
there were any complaints around the turnaround time. Agricorp
was charged with the responsibility of cutting those cheques once
the applications had been approved by the ministry. I don't
believe there are any complaints about completing that process,
so I don't believe there is a concern about Agricorp's
involvement there. If the question you're asking is how the
dollars flowed out of the program and what the deadlines for
applications were, then I think David could provide that
additional information.
Mr Hope: The
short answer is no, the investment practices of Agricorp did not
impact the flow of funds to farmers. To put it in context that
you had mentioned, in early 1999, Ontario offered an interim
program, there were applications made on that program and
approximately 2,500 people received money on that basis. They
also were required to apply to the full program once it was
started. In addition, people were able to apply for the first time. So we had a number of
people who applied early and payments were made.
As far as the applications to
the full program, over 70% of them came in in the month prior to
the July 31 deadline. That is why there was an unequal processing
of payments, because the applications came in that way. There
were quite a few up front in the spring, and a lot came in in the
three to four weeks prior to the deadline and then those were
processed. We always had a very short turnaround time from the
time we had sent notification to payment to Agricorp and the time
the cheques went out, and that averaged about a two-day
turnaround or less.
The Chair:
One more minute, Mr Peters.
Mr Steve
Peters: On page 26 of the auditor's report there's
reference made to the illegalities and losses inappropriately
transferred from the general fund to the crop insurance fund.
What I'm trying to find out is-and I asked the auditor this
question about the transaction that took place-why the board
would get involved in investments that were totally contrary to
what was allowed under the order that created Agricorp. Why would
you begin to get involved in areas that you shouldn't have been
involved in?
Mr Ingratta:
I want to stress one point. In the conversations that we've had
with the Provincial Auditor, and I believe in his report-you've
used the term "illegalities." I don't believe that's an
appropriate descriptor of what has occurred. In fact, we have a
written legal opinion that there were no activities that would be
found under the Criminal Code or under the Agricorp Act to be
illegal. I want to emphasize that the investments and the
purchase of bonds, that investment instrument, were within the
bounds of the program. The issue that was inappropriate was the
active trading of those bonds.
The act and the memorandum
between Agricorp and the ministry were silent on the issue of
active trading. It was not included; it certainly will be and has
become part of the policies and procedures of the current board
to suggest that this active trading is an inappropriate
mechanism.
So the instruments were used.
I need to comment on the issue of highly speculative trading. The
active trading was inappropriate, but the purchase of the
instruments, the bonds, was not. They were not in the processes,
as some may suggest that they were highly speculative
investments. They weren't penny stocks on the Vancouver exchange.
The instruments were appropriate; the active trading was not. The
Provincial Auditor has pointed that out. We support that view,
and it is not permitted.
1110
The Chair:
We'll have to leave it at that. Mr Cleary, could you take over
for a few minutes? We've gone 22 minutes, so we'll have 22
minutes for each one of the other caucuses as well.
Ms Shelley Martel
(Nickel Belt): Deputy, I think what's so disturbing
about the audit is really the clear evidence of gross negligence
at so many levels. You have tried to say that this corporation
operates at arm's length from the ministry. But if you look at
the memorandum of understanding, in fact you are very clearly
tied, and part of the problem was that no one seemed to abide by
many of the rules and responsibilities in the memorandum of
understanding. For example, there was negligence in the
minister's office because ultimately he is supposed to monitor
Agricorp's activities to ensure that its mandate is fulfilled and
is in compliance with government policies. We know the
corporation was not in compliance with government policies.
Frankly, I think there was negligence in your office because
under the same MOU you're supposed to meet with the board and the
chair regularly and discuss issues regarding the mandate of the
board and inform ministers of the problems. We know, because the
auditor has told us, that there were six vision statements in
three years, so clearly people didn't have any idea of what their
mandate was and that didn't seem to get cleared up at all.
I think there was negligence
on the part of the board and the chair because they are appointed
by the government and they are responsible back to the minister
to ensure that the business at the corporation occurs as defined
in the act, and we know that it did not.
Also, I think there was
incredible negligence on the part of the ADM who sat as a member
of the board, because frankly he or she better than anyone else
should have known the requirements of the act, and yet there were
many transgressions that were clearly in violation of the act
during the whole period that individual was there, and finally
certainly some negligence of the CEO, who was supposed to oversee
the operation of the corporation, as per the act, and clearly
didn't do that.
I hope that all this
negligence was unintentional, but I think the fact remains that
were it not for the auditor and the full-blown audit, there
probably would have not been any action taken on many of these
issues, because since you folks didn't do any internal audits
during this whole time, you didn't identify the problems.
The one thing that I worried
about in your opening remarks is that you said when these
problems were identified by the auditor you clearly and quickly
reacted. We have heard otherwise, and I'll give you one of the
examples that I want to start with. We have been clearly told
that the problem around the fund administration, that is,
interest from the corporation insurance fund to be transferred to
the general fund, was a problem that was identified with your
ADM, who sat on this board as early as 1997, and no action was
taken to deal with that. Both the CEO and your ADM continued to
say that they had a legal opinion that said it was OK, despite
several attempts by the auditor's office to clearly express
concerns. Why was it that from 1997 on that item picked up by the
auditor was not responded to? I point out that it wasn't until
the full-blown audit began in May that, finally, outside
independent advice was agreed to by both parties to actually get
some kind of ruling on this.
Mr Ingratta:
The point on fund administration is an important one. Without
seeking his concurrence at this particular point, I would say the issue of the
administration, particularly of the interest earned in the crop
insurance fund, was the point of, if you will, greatest
contention between the Provincial Auditor and the ministry. You
are right that we have had debate over time on the issue of
interest, specifically from the fund. I have to point out that
over the course of time both the federal government and ourselves
and the producer groups came to an agreement that interest from
that fund might be appropriately used for a portion of the
administration activities of Agricorp.
The act itself, as I
understand it, is silent on how the interest might be used. It is
clear that the interest could not be taken from the fund, but if
interest was generated by the fund, the act is silent in that
regard. We, along with our federal colleagues, determined that it
was an appropriate use to take some of that money to charge for
extraordinary administrative expenditures. We continue to have
that dialogue and, if you will, debate with the Provincial
Auditor's office. We came to an agreement in 1999 that we would
abide by-because we had two opposing legal and audit views of how
that could be used, we came to an agreement that a respected
third party would review that situation and we would abide by the
decision of that third party. The Provincial Auditor's office and
ourselves asked for that opinion in course. That opinion was
generated and it suggested that the use of those interest funds
for administration was not appropriate. When we received that
opinion the monies that had been used for administration from
that fund were returned to that fund forthwith.
We did have, I think, open
and honest dialogue about the use of that fund, and I have to
emphasize that both the federal government and ourselves were of
the opinion and had legal support for our position and that's
what created the dialogue to be extended. I have to also add-
Ms Martel:
Deputy, if I might, I'm not concerned about the federal
government. The Provincial Auditor audits the books of Agricorp,
correct?
Mr Ingratta:
That's correct.
Ms Martel:
And is it true that beginning in 1997 staff from the Provincial
Auditor's office raised this concern with you, raised this
concern with your ADM who was sitting on the board?
Mr Ingratta:
The dialogue on the interest from the crop insurance fund has
been ongoing, yes.
Ms Martel:
When the ADM was advised of this problem, and we were told it was
in 1997, did he bring it to your attention?
Mr Ingratta:
Yes.
Ms Martel:
What did you do at that point?
Mr
Ingratta: We sought the legal opinion of whether the act
would permit the use of those funds.
Ms Martel:
You sought that legal opinion from your own legal staff within
the Ministry of Agriculture and Food?
Mr
Ingratta: Yes.
Ms Martel:
When the auditor came back to you and said they were not
satisfied with that legal opinion, what happened then?
Mr
Ingratta: Then we sought the, if you will, final legal
opinion.
Ms Martel:
But this was, am I correct, two years after the auditor first
brought it to your attention?
Mr
Ingratta: David, if you will.
Mr Hope:
The issue did occur over time, but the money that we are talking
about was withdrawn, I believe, in early 1999, not in 1997. So
there were discussions as to what were the best solutions for
this situation among clients and the representative parties in
1998. Agreements were made and action taken in early 1999 that
resulted in ongoing discussions with the Provincial Auditor's
office during further months in 1999. It was in 1999 that the
issue, I believe, was resolved to everyone's satisfaction.
Ms Martel:
I never said that any money was withdrawn in 1997. I said that
the problem was identified by the auditor with your ADM and,
clearly, the deputy in 1997. The problem was identified, and it
looks like for over-I'll give you the benefit of the doubt and
say an 18-month period, you stuck with your legal opinion despite
the concerns that were raised by the auditor, and despite his
concerns, in 1999 then went on with a withdrawal of money from
the fund-is that correct?-in spite of the concern that had
already been raised?
Mr
Ingratta: The concerns had been raised over time, and as
David pointed out, the actual transaction did not take place
until 1999. We did take that action and that decision despite the
suggestions and advice of the Provincial Auditor. That was an
audit view. We were under the support of a legal view that what
we were doing was appropriate.
Ms Martel:
So you knew that transaction had occurred despite the
concerns?
Mr
Ingratta: Yes.
1120
Ms Martel:
I think that's a serious problem, Deputy, to be quite honest with
you.
Let me deal with the second
issue. The auditor raised serious concerns about Agricorp's
investment strategy, which I gather was developed about two and a
half years ago. Can you tell me who would have approved the
investment strategy? Did your office see that investment strategy
after it was developed?
Mr
Ingratta: The investment strategy on the crop insurance
fund?
Ms Martel:
Yes. A two-and-a-half year period since Agricorp's put into place
an investment strategy for the Ontario crop insurance fund, so it
would have been early on in the development of the corporation.
Was that strategy approved by your office?
Mr
Ingratta: Yes, the basic investment strategy would have
been considered by the ministry. The basic investment strategy in
terms of government bonds and the types of instruments that were
allowed in the portfolio would have been supported.
Ms Martel:
Let me ask, would the minister's office have had to approve
it?
Mr
Ingratta: I don't believe so.
Ms Martel: Do you know if he ever
saw it?
Mr
Ingratta: The investment strategy?
Ms Martel:
Yes.
Mr
Ingratta: I can't speak to that.
Mr Hope:
The investment strategy was approved for the crop insurance fund
by the board of directors. I'm not sure exactly which concerns
you are raising with it.
Ms Martel:
If I go back to the auditor's concerns about the investments, he
raised a number. They have to do with the speculative daily
tradings and inappropriate use of funds held for your ministry by
Agricorp in its daily trading. He mentions that $2.9 million that
came from funds that were held for the ministry to make payments
for the Ontario whole farm relief program were actually used in
the trading. Under this whole section also comes the fact that
Agricorp sold some of its long-term bonds to meet indemnity
requirements when those indemnity obligations did not exist.
In terms of the auditor's
report, when he makes recommendations that you should ensure
there are proper controls in place, you folks reply that it's
been two and a half years since you put this strategy in place
and it's had a competitive rate of return for its stakeholders
etc, which is all fine and dandy. But my concern is, who saw it,
who approved it and, then, who was supposed to monitor how the
investment strategy operated? Clearly there were a number of
transgressions.
Mr Hope:
Could I clarify, because I think we've got two or three issues in
that statement. The crop insurance fund, which is the sum of
money in the neighbourhood of $200 million to $300 million, had a
board-approved investment strategy that was, I think, appropriate
for the legislation. Of those issues that you raised, I think
there is only one that applies to that particular fund and that
strategy, and that would be the rebalancing of the long-term
bonds in that fund. I think the auditor also pointed out that if
those bonds that were purchased were held to maturity, as the
strategy intends, there would be no loss to that fund.
I believe that is the only
issue the auditor raised with the crop insurance fund investment
strategy. I think it continues to be a strategy that is
acceptable to the Provincial Auditor, the board-approved
strategy. The other issues were dealing with operating funds.
Ms Martel:
I appreciate that. I guess the problem is the bonds weren't held
to maturity. They were sold before they had to be, at a loss.
My question is, after the
strategy was approved by the board and clearly seen by the
deputy's office, who was responsible for ensuring that its terms
and conditions were met? Clearly, selling bonds before they
matured-if that was part of the strategy, that's a problem; if it
wasn't, how come that wasn't picked up?
Mr
Ingratta: It clearly is not part of the strategy. The
active trading was not part of the strategy.
Ms Martel:
Was the ADM who sat ex officio for you responsible for monitoring
the strategy?
Mr Hope:
Again, let us be clear that the issue around the rebalancing of
the bonds in the crop insurance fund was only a loss if the
replacement bonds were not held to term. This approach or the
strategy for the crop insurance fund is a conservative strategy
investing in very specific types of instruments. What we had was
advice by the firm hired to do that that there be a rebalancing
of these bonds, and that as long as they are held to maturity, as
is the strategy, there is no loss to the crop insurance fund. The
fund is structured so that monies would be available when needed,
but at the same time maximizing returns using a conservative
investment strategy.
Ms Martel:
I understand all that. My concern is that the strategy was
clearly not followed. There was a deviation and the auditor
picked that up. I understand you have implemented a new strategy
as of March 27, and I would like to know who would be responsible
now for ensuring there are no transgressions or deviations from
this new strategy.
Mr
Ingratta: If I might, you're correct in identifying that
the new strategy was enunciated and supported by the board. As I
indicated earlier, we now, as a ministry, have official voting
representation on the singular board rather than the multilevel
board. The knowledge of all activities would flow through that
person as a result of that change.
There are several things we
have done as a ministry. In addition to having that full-time
representation on the board, we have devoted and will be devoting
a greater level of internal audit resources to ensure that the
changes that have been implemented are pursued. In addition to
that, we have formalized a monthly meeting of the CAO and the ADM
responsible for policy on the farm finance division. So we have
put in place several mechanisms to ensure that the new strategy
as enunciated is supported and followed.
Mr Hope:
If I could add to what the deputy said, I think we are now
referring to the investment strategy for the operating funds. The
board has approved a number of processes to ensure that the
inappropriate situation does not happen again. The investment
activity is now under the responsibility of the chief financial
officer, who has significant experience. There are additional
processes in place as far as duplicate signatures before any
transaction is authorized.
The board has a report
brought to it at every meeting, with the details of that strategy
and how it was implemented. The board has also hired an audit
firm to come in quarterly and provide them with assurance that
the information provided to the board at each meeting is
followed. The ministry rep, who is in this case myself, will be
getting that information and will be able to provide the ministry
with the assurance that that strategy is being followed.
Ms Martel:
The auditor pointed out that no internal audit had been done of
Agricorp since its inception. Can you explain to the committee
why that was the case?
Mr
Ingratta: The auditor of record for Agricorp is the
Provincial Auditor and their office did in fact complete annual
financial audits. We did not, as part of our process of internal
audits that would be conducted in the ministry, identify Agricorp as a priority for
internal audit, partially because of the ongoing activities of
the Provincial Auditor on that file. As a follow-up to the
Provincial Auditor's report, and in agreement with the Provincial
Auditor, to assist them in their annual activities of financial
audit, we have agreed to devote more internal audit resources to
Agricorp to support their activities in the future.
1130
Ms Martel:
I appreciate that you're going to have monthly meetings between
the CEO and the ADM. My concern is that the previous memorandum
of understanding certainly allowed for that and I'm wondering if
meetings did not take place and that's why problems were not
identified. For example, Deputy, if I might, you were to have
"regular meetings with the chair and the board to receive updates
and discuss issues around Agricorp's mandate and inform the
minister as required." For the period during which the Provincial
Auditor was the auditor of record and then when he started his
full-blown audit, were those meetings taking place?
Mr
Ingratta: There were meetings between myself and the CEO
of Agricorp discussing issues of concern and importance to the
ministry and Agricorp. If I might relate, some of the dialogue we
had included things like the investments and administration that
would be required to make sure that the program continued to be
as efficient as possible. There were interactions between myself
and the CEO. At no time during those sessions were there
discussions on whether, for example, active trading was
appropriate. That dialogue did not take place.
Ms Martel:
What about a dialogue on the new information technology
infrastructure or any of the infrastructure changes that Agricorp
was busy making? Clearly, from the auditor's report, $3 million
was just lost because of a change in direction. Were there any
discussions during that period about what the corporation wanted
to do with respect to technology changes?
Mr
Ingratta: The issue of technology is an important one to
an organization like Agricorp. You can well imagine that for
19,000 participants in the program, with multiple crops and
multiple years of records on those individuals and those
individual crops, there is a massive database. The Ontario crop
insurance program is different than some of the other provinces
in that payments are made based on individual records; that is to
say, information technology is very important in delivering on
the business of crop insurance.
As technology evolves, it
was clear that an effort would be pursued to move away from
mainframe processing of all that data, looking for some of the
new technologies that allowed, if you will, desktop. Interactive
desktop activity with technology appeared to be the way to go for
the future, to allow flexibility and instant access by field
representatives to those records, again in an effort to focus on
providing increasing customer service.
So the discussions were had
relative to moving toward desktop technology. Efforts were made
to achieve that and in the final analysis the technology and the
software that was being developed to go with that desktop
technology did not fit the massive amounts of data required as
part of the crop insurance program.
Today they are using a
mainframe technology. I hasten to add that the information
technology system, the computer systems within Agricorp, are
delivering crop insurance cheques within the identified time
frame based on those individual calculations. There is a
completely functioning information technology system delivering
on the timelines and the time frames in Agricorp.
The Chair:
We'll have to leave it at that. Time's up. Mr Hastings.
Mr John Hastings
(Etobicoke North): I just want to make sure, Mr Chair,
that we're getting 25 minutes, which will take us right to 12:01,
looking at the clock when the critic started at 11:10. We get
25?
The Chair:
No, I think we started at 11:12, sir.
Mr
Hastings: Not according to the way I watched that clock
up there.
The Chair:
I made a little note to myself and I looked at that clock when I
put down 11:12.
Mr
Hastings: Anyway-
The Chair:
Go ahead, sir.
Mr
Hastings: I don't think we're getting the same, adequate
time. I just want to make noted on the record.
The Chair:
Absolutely.
Mr
Hastings: My first question is to Mr Ingratta, and
probably to Mr Hope, with respect to the historical genesis of
Agricorp. How far back does this idea go in the ag ministry,
OMAFRA?
Mr
Ingratta: As I've indicated, crop insurance has operated
as a function within the province for 31 years. Although the
concept of moving to an agency separate from government doesn't
have a 31-year history, it has been discussed in various venues
over the last 12 to 13 years. The rationale for that discussion
is that the major business of Agricorp is dealing with that
massive amount of actuarial data that generates an insurance
program. Various incarnations of how that could be more
appropriately handled in an agency outside of government have
been debated over some time. In the early 1990s, there was
proposed legislation to create the agency. There were certainly
active discussion in the late 1980s and, as I indicated in my
opening remarks, very active dialogue in 1996 with the
agriculture and the food sector on whether the concept of moving
this insurance function into a more private-sector-type
relationship would be appropriate. Based on that consultation in
1996, the move was made to create the agency, so it has been a
fairly long genesis.
Mr
Hastings: Mr Ingratta, let me give you that document.
That's a bill that was introduced by the Minister of Agriculture
and Food back in 1993, Bill 63. Is that very similar to the bill
we have in place now?
Mr
Ingratta: Without comparing the two bills line by line,
I would say that the concept is similar. I'm reflecting, if you
will, on my historic knowledge here. In 1993, I was appointed as
the chief executive officer of the Crop Insurance Commission, the
forerunner to Agricorp,
and part of my responsibilities at that time was to develop this
concept and potentially move the organization outside of
government and create the more private-sector type of entity.
Mr
Hastings: Thanks for that historical perspective.
In terms of communications
between OMAFRA and the auditor, there were various communications
I assume, not only verbal but written, over the auditor's
concerns?
Mr
Ingratta: Yes. We had, as I indicated, several
conversations, particularly on the conversations and meetings on
the investment and the use of interest in the crop insurance
fund. We've received draft copies. I believe it's the practice of
the Provincial Auditor's office to share draft copies of the
report, multiple iterations of draft copies. So, yes, we have had
both verbal and written interactions between the ministry,
Agricorp and the Provincial Auditor's office.
Mr
Hastings: Specifically, did you receive a letter from
the auditor's office dated May 31, 2000, which basically-and I've
seen these letters as director of other corporations, companies,
organizations-says, in effect, and I'll quote the public accounts
letter, the last statement, "In my opinion, these financial
statements present fairly, in all material aspects, the financial
position of the corporation as at March 31, 2000. The results of
this operation and its cash flows for the year then ended in
accordance with generally accepted accounting principles." We put
that letter into the record.
1140
How does that contrast with
the concerns raised in the auditor's report that we now have in
front of us on accountability and value for money? It would be
fair to say that the measures, the concerns and the
recommendations taken up by the auditor have, to a great extent,
already been put in place-accountability, financial controls,
better IT management-as of May 31, 2000.
Mr
Ingratta: I believe the document you are referring to is
the result of the annual financial audit of the Provincial
Auditor. That would have been received, along with the annual
report of Agricorp. So, yes, there is a distinction between the
financial audit and the value-for-money audit, which would have
delved into a number of areas in more detail, but we would accept
the financial audit. We received a number of those annual
financial audits from the Provincial Auditor's office.
Mr
Hastings: My final question relates to the trading loss
of the $325,000. Given the concerns raised by the auditor in the
November special report to the legislative committee on public
accounts, what specific steps have you already undertaken or are
contemplating undertaking to recover some or all of the $325,000
that made up the accounting loss from the inappropriate trading
of the bonds?
Mr
Ingratta: The amount you've identified was in fact put
into the Agricorp accounts in early January of this year. So that
action has already been taken, and taken, as I said,
expeditiously in January of this year. That money is in the
appropriate accounts and was put into the appropriate accounts in
January of this year.
In addition to moving the
money-and I think this is the critical point and this is where we
get the value-for-money audit that the Provincial Auditor
does-the suggestions on how we could improve the accountability
system were offered and taken and acted on and supported by the
board of directors on March 27 of the year 2000. David has
already delineated some of those actions, how we're improving on
the financial accountability and how we're strengthening and
putting additional resources into the relationship between the
ministry and Agricorp. I believe it's fair to say, not only based
on the November report but earlier in the year as a result of
those ongoing dialogues and interactions with the Provincial
Auditor's office, we took a number of steps to put in place
mechanisms that would minimize the opportunity for the
inappropriate actions to happen in the future.
The Chair:
Mr Peters just wanted to make a comment.
Mr Erik
Peters: Thank you very much for that, Deputy. That was
very helpful. I just wanted to get at the core of the question,
as I understand it, from Mr Hastings, and that is very quickly to
say that when we opine on the financial statements, we would, for
example, say that the loss is fairly stated. The idea of the
opinion is simply: do these financial statements present fairly?
That would be done under an audit offered under the Agricorp Act,
the legislation under which they operate. However, the report
that you got on November 21, that's where we would delve deeper
as to how the loss occurred, why it occurred and what are the
procedures surrounding it. So it's the difference between fair
presentation or, did the taxpayer get value for money.
Ms
Mushinski: I have several questions, I think primarily
to clarify what may be some confusion over when you first started
receiving expressions of concern about some of the management
practices.
Alluding to Mr Hastings's
questions about the history, Agricorp was actually established in
1997. It was established, my understanding is, as a schedule 3
agency. Schedule 3 agencies-and I have to go from memory here-are
required to follow certain business practices, I assume, and they
have certain relationships with the ministry etc. First of all, I
wonder how many schedule 3 agencies are under your ministry and
if the established business practices are the same for all of
those schedule 3 agencies.
Mr
Ingratta: While David is checking for the number of
schedule 3 agencies, there is a series of management board
directives and guidelines for interactions with agencies. As you
would know, there used to be four identified types of agencies.
Recently, Management Board has extended the definition of
agencies because of a broader range of activities that are now
being pursued. I believe there are now seven categories of
agencies-operational enterprises, service delivery functions,
regulatory agencies, a whole range of agencies-so there are those
general guidelines and directives. They would be consistent
with-
Ms Mushinski: Yes, and contained
within these guidelines, I would assume, Mr Ingratta, are some
guiding principles behind auditing functions, or checks and
balances, especially with new agencies. I wonder if you could
enlarge on that for me. I'm just concerned that we heard this
morning that there were considerable expressions of concern right
from its inception about some of the business practices expressed
by the auditor and I'm wondering what kind of communication there
was, what kind of follow-up there was and at what point you were
required to actually undertake changes in procedure based upon
ministerial directive.
Mr
Ingratta: In answer to your first question, Agricorp is
the only schedule 3 agency-if we use the definition of 1 through
4-that the ministry has a responsibility for. In establishing
Agricorp, we developed an MOU, a memorandum of agreement, between
the ministry and Agricorp that outlined the responsibilities of
the board, of the CEO, of myself and of the minister. So we would
have operated under those general guidelines and principles in
the MOU. There are appendices in the MOU to deal with some of the
regular activities, but I need to come back to the issue that the
relationship is an arm's-length relationship. It's not a daily,
regular interaction with the agency. The agency is set up for the
purpose of conducting that business at arm's length. The basic
responsibility of the ministry is to provide that policy
direction and oversight to the board.
1150
Ms
Mushinski: So the investment activity, for example, is
part of that arm's-length relationship and the day trading that
has been alluded to, and certainly referred to, by the auditor
through his value-for-money audit.
Mr
Ingratta: The general principles on investment are
provided. The issue of day trading is not part of that current
memorandum of agreement.
Ms
Mushinski: When was that first identified? Was it
ongoing from 1997?
Mr
Ingratta: The day trading?
Ms
Mushinski: Yes.
Mr
Ingratta: Our understanding is that the day trading took
place in October 1999.
Ms
Mushinski: There was no such day trading prior to
October 1999?
Mr
Ingratta: Not that we have or, I believe, the Provincial
Auditor has identified. It was a defined, relatively short time
period in October. I think the day trading spanned about a
two-week period in October 1999.
Ms
Mushinski: Those are my questions.
The Chair:
Any other questions? You have lots of time left.
Mr Bart Maves
(Niagara Falls): I just wanted to pick up on that. Can
you clarify, in your best layman's terms that you can-you had
ongoing conversations and legal opinions going back and forth
between yourselves and the Provincial Auditor and with the
federal government starting in 1997 about a certain investment
practice or something that was happening on the board. That's one
thing. Another issue is the issue of day trading, which never
came up until October 1999. So that's a distinct issue from this
other issue that you had. Can you clarify the distinction
there?
Mr
Ingratta: I would attempt to make that clarification.
The dialogue we had ongoing with the Provincial Auditor's office
was specifically on the use of the interest in the crop insurance
fund. The crop insurance fund, I believe, as of the end of March
2000 was around $300 million. That's the fund that is used to pay
the indemnifications of the insurance policies that exist.
Currently there are about $1.2 billion of indemnifications, so
that fund is there to pay claims. I believe the largest claim
year that existed under that fund would have been about $150
million; that would have been in 1992. So the fund exists. It's a
large sum of money, and the rules around investment are fairly
clear and I don't believe are in question as part of the
Provincial Auditor's report.
The question that we had
debated for some time, and it appears in this report, is that the
fund obviously generates interest. The use of that interest was
the point of debate. We argued, and had legal opinion to support,
that the act was silent on the use of that interest. That is
where we decided, in conjunction with the federal government and
the grower groups, to use a portion of that interest for
administrative purposes with Agricorp. The Provincial Auditor's
office has argued that the administrative costs of Agricorp
should be paid in their entirety from the federal and provincial
grant to Agricorp. That's the point of some dialogue.
We did make the decision,
in the presence of the Provincial Auditor's comment that in their
view it was inappropriate, to use some of those interest dollars
for defined administrative purposes. We also agreed, as the
debate between the Provincial Auditor's office and the ministry
continued, in order to end the debate, because we didn't want
this to go on ad infinitum, that when a final legal opinion was
sought-we had an audit opinion and a legal opinion. We agreed we
would seek a final legal opinion and we would be bound by that
legal opinion. When we received that legal opinion that suggested
that the interest from that large fund should not be used for
administrative purposes, then we-or Agricorp, more
correctly-returned the dollars to that fund, after the final
decision had been taken.
Mr Maves:
Now-
The Chair:
I had some questions as well, but go ahead. You've got five
minutes left.
Mr Maves:
I went back, because the auditor audits 47 of our schedule 3
agencies. In the course of doing that audit, they publish in the
public accounts a letter every year that tells the reader the
basis of their audit, and it's directed to the board of directors
of Agricorp or to the ministry of public account. It's the same
letter every time. It basically just says, "I've done the audit
and in my opinion the financial statements present fairly the
financial position of the corporation," da, da, da. To anyone
reading it, the letter says, "I've done the audit and it gives
you a clean bill of health."
I've also got some letters that went to the chair
of Agricorp, though, that said, "You will be pleased to note that
I have given an unqualified audit opinion on the enclosed
financial statements .... Nevertheless, a management letter
suggesting areas for improvement will be sent to your attention
presently."
Would you be copied, as a
ministry official, on those letters when the auditor of that
agency is saying-and the auditor can correct me if I'm wrong-"In
the course of doing my audit, as the auditor of these agencies,
we found some things that are of concern, so we are sending a
management letter suggesting areas for improvement to
Agricorp"?
Either one of you can
answer this question: Would you have been copied on that and, if
so, did you also have conversations with the auditor's office
about that situation? It's actually Ken Leishman, the assistant
provincial auditor, who wrote the letter. I'm curious about the
relationship and the communication between the auditor of these
agencies and the ministry responsible for that.
The Chair:
Mr Ingratta, if you want to give an answer first and then Mr
Peters, then I'll go over to Mrs Munro. Go ahead, sir.
Mr
Ingratta: The Provincial Auditor would have direct
contact with the chairman of the board of Agricorp. Agricorp is
the client on that financial audit, so that would have been the
first point of contact. Certainly, over the course of the
value-for-money audit we would have had dialogue with the
Provincial Auditor. But Agricorp is the client of the financial
audit-
Mr Maves:
I know; I understand. That was the 1998 audit. Then again, in the
1999 audit there is a letter that went out that said, "I give an
unqualified audit opinion on the enclosed financial statements
and suggestions for areas for improvement will be part of a
value-for-money audit plan." From reading this, I think the
auditor uncovered some more concerns with the management of
Agricorp, told Agricorp he had some concerns, didn't include
those concerns in the letter but said he would include them later
on in the form of a value-for-money audit.
My concern is the
communications between the auditor of these agencies and the
ministry responsible for these agencies, that if they're
uncovering management problems, not only should they address them
with that agency, but they should be letting you know because
you're responsible for that agency and they're responsible to you
and to the Legislature as auditors of that agency for what those
things are. Otherwise, how could you and how could the minister
possibly oversee and say, "Yes, here are the problems identified
by the auditor. Did Agricorp fix them?"
I'm concerned about this
relationship of communication. What exactly is getting
communicated?
The Chair:
Who wants to comment on that? Really the time is up, but I think
we should have an answer to this question.
Mr Erik
Peters: It's different mandates of my office. When we do
a financial audit, the audit is strictly designed to assess
whether there is a fair presentation of the financial position of
the operating results of the entity and of its cash flows, but we
do not in that audit particularly opine whether things are
prudently done within the organization. That is subject to
section 12 of the Audit Act, under which I separately report.
This is why in many agencies-I'll give you an example. In the
Workers' Compensation Board, for example, on WSIB, the Minister
of Labour actually introduced special legislation that
value-for-money audits be conducted, although the financial audit
was going on all along. So the communication of the management
points-in this particular case the prime addressee of our
financial audit is actually the board of directors that has the
governance function, and that's why we-
The Chair:
We'll have to leave it at that because the time is up, and a vote
is being called for in the House fairly soon as well.
Interjection.
The Chair:
Yes, you did get your allotted time, Mr Hastings, you really
did.
Anyway, what I would
suggest is that we have a subcommittee meeting between now and
the next meeting to decide, first of all, whether you want to
continue with this on the December 21 meeting or what you want to
do on the December 21 meeting. Maybe the caucuses can get their
position on that between now and then. So we'll have the
subcommittee meeting probably next Tuesday or Wednesday, when it
can be arranged with everybody.
Ms
Mushinski: Mr Chair, I don't think we have actually been
informed by the clerk yet.
The Chair:
Yes, we are. Well-
Interjection.
Ms
Mushinski: It hasn't been determined? So I think the
discussion last week was whether we would be meeting on December
21 if the House isn't sitting.
The Chair:
That's right.
Thank you very much for
attending here today, Deputy, and the rest of your delegation. We
appreciate your attendance. With that, the meeting's
adjourned.
