ARCHIVED - Review of the Responsibilities and Accountabilities of Ministers and Senior Officials - Meeting the Expectations of Canadians

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4. Role of the Treasury Board in the Accountability Regime

Introduction

This section provides an overview of the role of the Treasury Board in the assignment of managerial accountability (as opposed to political accountability, which marks the relationship of ministers to Parliament). It focusses on deputy ministers' accountabilities to the Treasury Board for the administration of their department. It explains how the Treasury Board sets standards for management and oversees management performance, demonstrating how this role has evolved over the years. Finally, it outlines how the Treasury Board addresses mismanagement, when required. This section shows that:

• a comprehensive accountability regime exists in government to deal with managerial accountability;
• in fulfilling its role, the Treasury Board must oversee the use of delegated authorities without undermining the responsibility and accountability of ministers and their deputies within departments; and
• the Treasury Board's capacity to apply institutional sanctions in the case of mismanagement is complemented by deputy ministers' authority to deal with unsatisfactory performance of employees.

4.1 The Treasury Board and the assignment of responsibility

Under the Financial Administration Act, the Treasury Board has authority over all matters relating to administrative policy, financial management, expenditure plans, programs of departments, personnel management, and other matters relating to the prudent and effective use of public resources in support of government objectives.^[33] The Board thus plays a critical role in establishing management policies and in monitoring government-wide compliance with those policies—including through the recently introduced Management Accountability Framework, a common basis for performance reporting and accountability that sets out a rigorous regime of managerial expectations and standards.

The Treasury Board is accountable to Cabinet and to the prime minister, who appoints the ministers to the Board. The president of the Treasury Board, like all ministers, is accountable to Parliament for the use of the authority granted to him or her under legislation. The Treasury Board, like the Cabinet, serves as a collective decision-making body and is governed by the doctrine of collective responsibility. The decisions of the Treasury Board form part of the collective responsibility of all ministers. They are based on advice from the Treasury Board portfolio (principally, the Treasury Board of Canada Secretariat and the Public Service Human Resources Management Agency of Canada) and on submissions received from ministers.

The Treasury Board performs its role through the following general authorities:

• approving management policies that control the delegation and use of authorities in departments and agencies and setting management standards in areas such as human and financial resources management, procurement, real property, and information technology;
• allocating resources through the Estimates;^[34]
• holding departments and agencies to account for how they allocate resources (including stipulating how the Public Accounts should be kept and reported) and allocating authority to spend through the approval of Treasury Board submissions;
• overseeing the performance of departments against established management policies; and
• acting as the principal employer of the Public Service.

The ministers who make up the Treasury Board, along with their Cabinet colleagues who initiate submissions, have a collective responsibility to respect the Board's decisions. This includes respecting Treasury Board management policies. Ministers are accountable for the use of their authorities in compliance with Treasury Board policies and directives.

As noted earlier, deputy ministers are assigned specific powers directly or through the Treasury Board under certain provisions of key acts of public administration without reference to their minister. Specifically, the Financial Administration Act confers directly on deputy ministers responsibility for the prudent management of resources allocated to their department, in compliance with certain Treasury Board policies, regulations, standards, and periodic audits. Responsibility relating to personnel management, including appointment, employer-employee relations, and the organization of the department, are assigned to deputy ministers directly by a number of acts, including the Public Service Employment Act, or are delegated to them by the Public Service Commission of Canada. Finally, the Official Languages Act confers a number of authorities on the Treasury Board and provides for delegation of its powers to deputy ministers.^[35] Ministers cannot provide specific direction to deputy ministers on activities in these areas, but they may provide general direction, given their overall authority for the management and direction of the department.

Consequently, deputy ministers have multiple accountabilities—to their minister, to the Public Service Commission of Canada, and to the Treasury Board or the prime minister through the clerk of the Privy Council.^[36] In the case of administrative authorities delegated to them by ministers under departmental legislation, deputy ministers are primarily accountable to their ministers. At the same time, deputy ministers must ensure that the Treasury Board can assess managerial performance so that it can fulfil its responsibilities for overseeing management and financial performance across government. This is the general accountability of deputy ministers to the Treasury Board for managing the authorities and resources delegated to them by the Board, and the senior financial officers and other officials who report to them directly support them in this.^[37] In addition to their accountability to the Treasury Board, deputy ministers remain accountable to their minister for the general management of their department. Deputies are also responsible for ensuring that they have in place appropriate systems, instruments, and management processes to be able to monitor performance. Internal audit and program evaluation are key instruments for departments in this regard and should be employed regularly, based on an assessment of risk.

4.2 Role of the Treasury Board in management oversight

Since Confederation, the Treasury Board's role in matters of financial administration has evolved. Throughout the evolution of the role of the Treasury Board, the central challenge has been to balance the requirement for central control over public administration and management with the need to appropriately delegate authorities to managers and support them with training and tools so that they can achieve results in a responsible and accountable manner. The starting point for effective accountability in a decentralized structure is to define clear management policy requirements and objectives, along with a robust set of performance indicators and focussed reporting on results and performance.

In this context, the Treasury Board does not have a role in comprehensively overseeing the compliance of deputy ministers or departments and agencies against every transaction. However, the Treasury Board and its Secretariat do oversee policy compliance, maintenance of control systems and, based on a risk assessment, individual transactions. The Board also has a duty to ensure that expectations of accountability, legality, and propriety are clear. In addition, it has a responsibility to oversee, selectively, departmental performance against these expectations, based on an assessment of risk, as well as on the Secretariat's resources and capacity to monitor compliance.

In performing this oversight role, the Secretariat relies on a number of sources, such as departmental audits, program evaluations, action plans, departmental performance reports, Treasury Board submissions, reports of the auditor general, the Public Accounts, and on discussions with departmental officials at all levels. Of particular note is the Management Accountability Framework, which the Treasury Board of Canada Secretariat introduced in June 2003 as a means of clarifying management expectations and using them to assess the management capabilities of departments and agencies.^[38] The Framework has three parts: the first consists of 10 interconnected expectations defined as the determinants of sound public service management; the second consists of key indicators to be used by the Secretariat and the Treasury Board to gauge departments' management performance over time; the third is a list of short-term measures to improve management performance, which can be tailored to each organization. The Framework is designed to reinforce principles of accountability and sound management. It gives public service managers a comprehensive, integrated model for management improvements.

The Treasury Board of Canada Secretariat staff, in turn, has a responsibility to draw to the attention of the president or the Board information on actual or potential management performance issues and to recommend whether or not to take action. Through such oversight, staff do not, however, become involved in the day-to-day management of a department. This would dilute the accountability of the deputy minister in the department. Decisions to take further action or to intervene hinge on the degree of risk involved in the management problem at hand. Interventions take various forms, including informal follow-ups, external audits or other investigations, and direction on specific preventative or remedial action to be taken by the department.

4.3 Role of the Treasury Board in addressing mismanagement 

The Treasury Board has a range of powers at its disposal should it feel that the actions of a minister or his or her officials in the management and administration of a department impinge on propriety or on the appropriate accounting for use of funds. The general authority of the Treasury Board over personnel management is set out in the Financial Administration Act. This authority includes, at the departmental level, reducing delegated authorities, placing restrictions on financial allotments, directly intervening in the management of the department, and revoking authorities. These are not personal sanctions, but rather the revoking of delegated authorities that have been conferred on the deputy minister or on officials in his or her department.

The Public Service Modernization Act modifies this regime further by conferring directly on deputy heads the power to establish standards of discipline, to set penalties, and to terminate or demote employees for unsatisfactory performance. The Treasury Board will retain the ability to establish policies on the exercise of this authority by deputy ministers in core departments. This means that disciplinary powers over public servants are vested in the deputy minister and not in the minister. Currently, a system of progressive discipline is employed, beginning with oral warnings, followed by written warnings, suspensions, and termination.

 

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