2006 November Report of the Auditor General of Canada

Determining benefits

6.39 Service Canada should implement a nationally standardized quality review system for applications for OAS program benefits, covering all types of applications and other key processing activities.
(6.28–6.38)

Service Canada's response. With the introduction of Service Canada enterprise-wide approaches, work is under way to conduct a baseline assessment of quality review processes. In 2006–07 a national quality review program will be introduced.

6.40 Until a standardized approach is in place, Service Canada should direct its processing centres to apply existing quality review procedures more systematically.
(6.28–6.38)

Service Canada's response. The national quality review system to be implemented in 2006–07 will include standardized procedures for use by regional processing centres.

6.46 Service Canada should review the approaches it currently uses to assess beneficiaries' continuing eligibility and should ensure that the necessary approaches are applied consistently in all processing centres.
(6.41–6.45)

Service Canada's response. National tools are being revised and issued to assist in the establishment of coherent and consistent national approaches to service delivery. As part of that ongoing effort, Service Canada will ensure that common procedures are implemented for returned taxation slips and for absences from the country for beneficiaries who have less than 20 years' residence.

Managing overpayments

6.71 Human Resources and Social Development Canada and Service Canada should take steps to improve their management of overpayments. These steps should include

• consolidating, analyzing, and acting on information on overpayments and collections;
• completing the review of their overpayment policy and ensuring that it is applied consistently;
• complying with the requirements of the Financial Administration Act concerning the charging of interest on outstanding overpayments; and
• finalizing policies and procedures to permit the implementation of the penalty provisions of the Old Age Security Act.
  (6.60–6.70)

Human Resources and Social Development Canada's and Service Canada's response. Measures are being introduced to ensure that processes for managing information on overpayments are rigorous and meet reporting requirements. Existing systems, with appropriate checks built in, will be used until the migration of Old Age Security program information to the Departmental Accounts Receivable System.

Human Resources and Social Development Canada acknowledges the need to review its policy on overpayments and integrate new statutory requirements. In addition, the policy will be revised where required to ensure coherence of application. This will be supplemented by review sessions with involved areas to support a common understanding. It is expected that a new draft policy will be completed by the end of 2006–07.

The Department is seeking the earliest opportunity to amend the OAS Act to comply with Financial Administration Act requirements. Given the limited financial resources of most pension recipients, the departmental position has been that public pensions programs should be exempt from the general requirement to charge interest on overpayments, except in cases of fraud or misrepresentation. Human Resources and Social Development Canada has identified a list of potential legislative initiatives for fall 2006, which includes a proposed amendment to the OAS Act. This amendment would grant regulation-making authority to exempt the charging of interest on outstanding overpayments in certain circumstances.

Human Resources and Social Development Canada and Service Canada will also take steps to finalize appropriate policies and procedures to permit the implementation of penalty provisions at the earliest possible opportunity. Human Resources and Social Development Canada and Service Canada recognize the need to implement appropriate penalty provisions within the OAS Act in cases of deliberate omission or misrepresentation. The current OAS Act sections on penalties, not yet in force, contain provisions that may create administrative complexities. Both organizations are reviewing these sections and will take legislative action, at the earliest available opportunity.