CANADIAN COUNCIL OF PUBLIC ACCOUNTS COMMITTEES
EXECUTIVE SUMMARY
TASK FORCE ON CROWN CORPORATION ACCOUNTABILITY
Crown corporations are a significant presence within Canadian society. They have been
utilized by governments since before Confederation. Over the years, vast distances, a
relatively sparse population, the presence of an economically and politically powerful
neighbour, strong and distinct national interests, and the existence of two main cultural
and linguistic groups nurtured the establishment of Crown corporations.
These enterprises have a considerable degree of operating autonomy and, in may cases,
are engaged to a significant extent in what might be considered commercial activities. The
dual personality of Crown corporations, reflecting public policy and commercial natures of
their activities, makes them distinct from government departments as well as private
sector corporations.
Their nature, requiring a certain degree of independence of action, also requires a
means to monitor and control the extent to which that delegation of authority is
discharged in accordance with the desires and needs of those providing that delegation
(legislature, government and board).
1. Significance. Crown corporations generally form a significant part
of overall government activity.
2. Accountability. Appropriate mechanisms to hold Crown
corporations accountable for their actions and results as enabled by legislatures should
exist.
3. Responsibilities. The control and accountability mechanisms,
including respective roles and responsibilities, are not always well defined and
understood.
4. Legislature Involvement. The Public Accounts Committee has
generally played a limited role, even though in some jurisdictions other legislative
committees review Crown corporation issues and matters. The role of the PAC requires
clarification.
5. Information. Legislatures, the PAC or other legislative
committees, are generally not provided with adequate information related to the
achievement of Crown corporation objectives.
1. The legislature (Public Accounts Committee or other Legislative
Committees) should play an important role in ensuring that there is a suitable framework
for Crown corporation accountability and in ensuring that individual Crown corporations
operate within the provisions of that framework.
2. To assist the legislature in carrying out its role with respect to
Crown corporation accountability, the legislature (or its committees) requires sufficient
information on the proper functioning of the overall framework as well as on individual
corporate performance as it relates to the achievement of objectives.
The main results of the survey are as follows:
- Significance. In terms of numbers of entities and their expenditures,
departmental and commercial Crowns form a significant proportion of total government
activity. Mixed and portfolio corporations generally form a less significant proportion.
- Roles and responsibilities. The preferred form of framework for departmental and
commercial Crowns is legislative. However, in the majority of jurisdictions, the
respective roles and responsibilities of the legislature, government, the Crown
corporations and the audiotrs are viewed as not being well defined and understood by all.
- Plans, budgets and reports. Corporate plans, capital and operating budgets and
reports on annual performance are required in just over half of the jurisdictions and
these documents are generally not made readily available for legislative scrutiny.
- Audit. Audit requirements vary extensively throughout jurisdictions. Internal
audit in departmental and commercial Crowns is required by legislation in only one
jurisdiction. External audit is focused primarily on the annual audit of the financial
statements of Crowns, and in less than half of the jurisdictions there is a requirement
for periodic audit of compliance with legislative authorities. Even fewer (three)
jurisdictions have a requirement for periodic audit of economy, efficiency and
effectiveness (i.e., value for money).
- Information. In almost all jurisdictions (seven), it is felt that the legislature
is not provided with information to enable the determination of whether departmental and
commercial Crown corporations have achieved their objectives.
- PAC involvement. Generally, it appears that PACs have a limited involvement
regarding Crown corporations. For example, in only two jurisdictions does the PAC review
the activities of each departmental and commercial Crown corporation. Also, in only one
jurisdiction are the annual reports of such Crowns referred to the PAC.
- Other legislative committees. In just over half of the jurisdictions, legislative
committees other than the PAC have authority to review Crown corporation matters (such as
divestitures, plans and budgets, annual reports, etc.). However, in only two jurisdictions
is there the view that there is adequate coordination among legislative committees to
ensure adequate coverage of departmental and commercial Crown corporation matters.
- Committee scrutiny. Although four jurisdictions feel that all Crown corporation
issues subject to legislative consideration should be dealt with by a single legislative
committee, six other jurisdictions do not support this approach. There is unanimous
agreement that all Crown corporations should be subject to legislative committee scrutiny
and that there should be specific criteria considered by such committees in their review
of Crown corporations. This legislative committee role should also be applicable to the
Mixed and Portfolio corporations according to the majority of jurisdictions with these
types of corporations.
- Consistency. Almost all jurisdictions agree that there should be a consistent
accountability regime for Crown corporations but not necessarily the same for each
corporation type.
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