Strengthening the power of the Auditor General
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On April 11, 2006, the Government of Canada introduced the Federal Accountability Act and Action Plan, delivering on its commitment to make government more accountable. The Federal Accountability Act received Royal Assent on December 12, 2006. This is one of a series of fact sheets describing proposed actions to respond to this commitment.
One of the most important roles of Parliament is to hold the government to account for its use of taxpayers' dollars. To do this effectively, parliamentarians need objective and fact-based information about how well the government spends public funds. The Auditor General is an independent and reliable source of such information.
In addition, the Government spends approximately $28.6 billion each year in transfer payments for grants and contributions to individuals, corporations, and non-government organizations. It is imperative that the Government ensures that these programs are well managed.
These changes reassure Canadians that their Government is using their tax dollars wisely. They strengthen the role of the Auditor General as an independent and reliable source of information about government spending. To maximize the use of taxpayer money, the Government will root out non-performing or irrelevant programs. Finally, these measures enhance the ability of Canadians and organizations to access government programs and services, and ensure that third parties that receive federal funding are not faced with an unnecessary administrative burden.
The Action Plan
Effective December 12, 2006, the Federal Accountability Act:
- gives the Auditor General the authority to "follow the money" by inquiring into the use of funds that individuals, institutions, and companies receive under a funding agreement with any federal department, agency, or Crown corporation; and
- requires every department to review, at least once every five years, the relevance and effectiveness of its grants and contributions programs.
The Government is currently developing regulations that will deem specific provisions to exist in all funding agreements, indicating that recipients must co-operate with and provide records to the Auditor General on request.
In addition, the Government is ensuring that the Office of the Auditor General has adequate resources to fulfill its mandate. The Government has been continuing to respond publicly to the Auditor General's recommendations, and will make sure that independent departmental audit committees monitor the implementation of corrective action plans.
In light of the independent review of grants and contributions programs, Budget 2007 committed to the development of an action plan to reform the administration of grants and contributions with a view to ensuring they deliver clear results in the most effective and efficient way possible within a sensible risk management framework.
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