Auditor general finds prison expansions aren't keeping pace

Auditor General Michael Ferguson has found problems with the federal governments plans to expand Canadian prisons, with agreements to provide for First Nations policing and with management of money set aside to develop the North.

• Read the auditor general's spring 2014 report

In his spring2014 reporttabled Tuesday in Parliament, Ferguson found Canada isnt saving as much as expected from shutting down two prison facilities and is spending money to expand others that are in poor condition, requiring upgrades.

He also found:

• There's little input from First Nations in the First Nations policing program.Its also being used in some cases to replace core policing services the provinces should be providing. And, in some cases, the policing buildings dont comply with fire and building codes.
• The $152-billion public-sector pension plan needs better riskassessment and planning. The Department of Finance says it does that assessment, but wouldnt share it with the auditor general, citing cabinet confidence.
• The $52-million Canadian Northern Economic Development Agency isnt properly monitoring the money it hands out and doesnt collect enough information from recipients to know whether theyre complying with the terms of their agreements.
• Statistics Canada provides good national numbers, but has a harder time breaking out data for small geographic areas and population breakdowns.
• The process to find a moving company for civil servants is inefficient, with the government sending a request for proposals before drawing up its plan to find the service provider.

At his press conference in Ottawa on Tuesday, Ferguson said thattwice over the course of the audits, the Department of Finance said it couldn't answer auditquestions because the information was kept secret as a cabinet confidence: for the public-sector pension plan assessments and for how it deals with Canada Revenue Agency requests for legislation to deal with aggressive tax planning.

Ferguson said it's normal that some information isn't available because of cabinet confidence, but that he found it "surprising" the information regarding tax legislation wasn't available outside of cabinet.

Transfer costs more than double

Canadas penitentiaries will be overcapacity again soon after the current round of expansions is complete, Ferguson says in his report.

More than 2,000 new cells were to be added by last month, but inmates are likely to be double-bunking again within a few years of the end of construction as they reach or exceed capacity again, it says. Auditors were told Correctional Service Canada hasn't finalized plans to address the shortfall.

Public Safety Minister Steven Blaney said about 20 per cent of inmates are double-bunked and that it's normal in the Western world. He pointed to the estimated savings the government has found after closing two prisons and a mental-health facility.

• First Nations policing program 'not working as intended': AG
• Northern economic development agency relies on Ottawa staff
• Public pension plans at risk over longer life spans, says AG
• Job vacancies survey vague, not terribly useful: AG

But Blaney and Ferguson differed on whether double-bunking increases the risk of violence in a penitentiary.

Blaney saidCorrectional Service Canada has done studies that show "there is no link between the rate of violence and double-bunking." He saysthe government doesn't believe prisoners are entitled to their own cells.

Ferguson said Blaney's department has recognized the risks of overcrowding.

"They do have, I think, a target of having no more than 20 per centdouble-bunking and they themselves have recognized that that can be a risk to security if they go beyond that," Ferguson said, adding that the risk of double-bunking wasn't the subject of his audit.

No room to transition

The government closed those institutions in 2013:

• Kingston Penitentiary.
• Ontario's Regional Treatment Centre.
• The Leclerc Institution in Quebec.

Auditors found that while the government projected the closures would save $120 million a year, the savings are only $86 million a year.

But the way the new cells are being added is increasing transfer costs, the audit found.

Public Safety Canada expanded prisons with available land already within the existing secure perimeters, so auditors found that the expansions weren't proportionate to the expected increases. That hasmeant increased cost to move prisoners around.

Corrections nearly doubled the number of offenders transferred from Ontario and prairie prisons to the Pacific and Atlantic regions, leading to more than doublethe costfrom $1.5 million in 2010-2011 to $3.4 million in the first nine months of 2013.

Canadian penitentiaries held 14,200 offenders in 2009, and that increased to 15,224 by March2013, close to the governments projection of 15,270. At the same time that there were more than 15,000 inmates, there were only 14,807 cells to accommodate them. The completed construction is expected to house 16,700 inmates in single cells.

It'snot possible for them to move down through the system and eventually get parole.- Auditor General Michael Ferguson

The audit also found offenders are in custody longer, despite entering treatment and rehabilitation programs an average of two months earlier than they were three years ago.

The report says discretionary releases by the parole board have declined 14 per cent since 2009, while the overall offender population has grown by nine per cent since March2010.

Ferguson said that could be because there's no room to transition inmates from a higher level of security to lower ones and then to a community facility.

"For somebody to achieve parole, for example, it's necessary that they have to be able to move down throughout the system," he said.

"But if they do not have enough facilities at the appropriate security levels, then they have to keep some of the offenders at sort of the more costly levels and it's not possible for them to move down through the system and eventually get parole."

Pensions viable?

Auditors also recommended periodically assessing whether public-sector pensions are sustainable.The Department of Finance said in its responseto the recommendation that it does regular assessments, but that the analysis couldn't be shared because of cabinet confidentiality.

Ferguson said he didn't have a concern that the government wasn't co-operating with auditors.

Treasury Board president Tony Clement said the decision to invoke cabinet confidence falls to civil servants, not politicians.

He also cautioned that the audit looked at the management of the pension plan, not whether it was sustainable. He said he agrees with one of the recommendations that suggested the government make it easier for Canadians to understand the risks ofthe plans.

"Theres a bunch of actuaries who sit in a dark room somewhere, and they get out their calculators and they work out whether these plans are sustainable given the facts on the table in terms of growth rates, and stock markets and so on," he said in explaining how government determines whether the plan has enough cash to back it up.

Public Works found lacking

Paying to relocate employeescosts the government about $300 million a year. In2009, Public Works awarded the contract to cover the approximately 17,700 Armed Forces, RCMP and public servantmoves, known as the Integrated RelocationProgram, to Brookfield Global Relocation Services Ltd.

Auditors found Public Worksknew its decision to award one big contract rather than a series of smaller ones meant that Brookfield was the only company in Canada that would be able to manage it, eliminating any chance of domestic competition for the contract.

The audit also found that the team evaluating the proposals didnt leave a paper trail for its decision to award the contract, noting the team didnt write down their comments or rationales justifying the scores they assigned for each criterion and for how they arrived at the final aggregate score.

The department manages moving services for civil servants who relocate, as well as the Canadian Forces and the RCMP.

This isnt the first time Public Works has had its knuckles rapped over contracting out moving services. In 2006, the auditor general found that contracts tendered in 2004 hadnt been done fairly. A House of Commons committee upheld that conclusion in 2007.

Auditors found even more administrative problems at the agency created to deliver cash to the North.