2007 May Report of the Auditor General of Canada

Control framework—Canada Student Loans Program

2.38 To ensure that the knowledge acquired about the provinces' and the territory's processes for eligibility and needs assessments is available for managing the Canada Student Loans Program, Human Resources and Social Development Canada should document its conclusions on the adequacy of controls and any related action taken. (2.36–2.37)

The Department agrees that the Canada Student Loans Program would benefit from better documentation of provincial and territorial processes for eligibility and needs assessment. Program officials already meet regularly with officials from participating jurisdictions to share information on their respective controls of these processes. The Department will institute procedures to ensure that its conclusions on the adequacy of the Program's controls for eligibility and needs assessments are documented.

2.44 The Canada Revenue Agency should develop and implement a formal quality assurance program to monitor whether collection procedures for the Canada Student Loans Program are followed properly in its regional offices. (2.39–2.43)

The Agency agrees with this recommendation. As noted by the Office of the Auditor General, the Agency has continued to move forward with an extensive modernization strategy to improve the recovery of debts owed since it assumed responsibility for the collection of defaulted Canada Student Loans in August 2005. The strategy already provides for resources to be dedicated to the monitoring of collection procedures and performance of the Agency's staff dedicated to this activity. The Agency has completed the necessary procedural and operational requirements to fully implement a formal monitoring framework, commencing the first quarter of the
2007–08 fiscal year.

2.48 The Canada Revenue Agency and Human Resources and Social Development Canada should strengthen the monitoring of private collection agencies to ensure their compliance with contractual and administrative requirements of the Canada Student Loans Program.
(2.45–2.47)

Human Resources and Social Development Canada's response. The Department agrees with the recommendation.

The Canada Revenue Agency (CRA) assumed responsibility for the collection of defaulted Canada Student Loans starting in August 2005, and thus it is responsible for private collection agencies' compliance with the collection directives.

Human Resources and Social Development Canada (HRSDC)/Service Canada maintained responsibility for establishing overpayments, reporting on the outstanding debt for HRSDC clients, recording the payments received from the private collection agencies, and ensuring client accounts are reconciled. HRSDC/Service Canada will leverage the CRA's efforts toward strengthening the monitoring of the private collection agencies and ensure compliance with administrative requirements.

With respect to the Office of the Auditor General's observation of the private collection agencies' handling and remittance of accounts, HRSDC/Service Canada implemented the Single System of Record on 19 January 2007. Payments are now received directly by HRSDC/Service Canada, thus reducing the risk of non-reconciliation of account information. HRSDC/Service Canada will closely monitor any exceptional payments made to private collection agencies to ensure accuracy between remittances and account information.

The Canada Revenue Agency's response. The Agency agrees with this recommendation. As noted by the Office of the Auditor General, the Agency has continued to move forward with an extensive modernization strategy to improve the recovery of debts owed since it assumed responsibility for the collection of defaulted Canada Student Loans in August 2005. The strategy provides for the monitoring of private collection agencies in respect of their performance and compliance with contractual and administrative requirements. The Agency has completed the necessary procedural and operational requirements to fully implement a formalized monitoring framework, commencing the first quarter of the 2007–08 fiscal year.

2.53 Human Resources and Social Development Canada should take appropriate measures to strengthen the control structure for the Canada Study Grants to obtain reasonable assurance that its grant eligibility criteria are being met. (2.49–2.52)

The Department agrees that the Canada Student Loans Program would benefit from receiving more complete data and information to verify that the participating provinces and the Yukon are properly applying the eligibility criteria for Canada Study Grants on behalf of the federal government. To improve the accuracy of the control structure for the Study Grants, HRSDC will change the conditions that the participating provinces and the Yukon must meet in order to be eligible for payment of funds awarded as Study Grants. Effective for the 2007–08 loan year, the participating provinces and the Yukon will have to provide basic personal information (Social Insurance Number-level data) for each student awarded a Canada Study Grant in order to receive payment. Before the Department approves these payments, it will verify the data and will approve payments to the jurisdictions for those awards that meet the eligibility criteria. HRSDC recognizes that not all provinces have the same degree of preparedness with respect to their data systems and will work with each jurisdiction to set reasonable timelines for efforts to improve the data.

Performance management—Canada Student Loans Program

2.80 Human Resources and Social Development Canada should develop a sound performance measurement strategy for the Canada Student Loans Program's goal to make post-secondary education more accessible to Canadians.
(2.75–2.78)

The Department has a performance measurement strategy for the Canada Student Loans Program and reports on the goal of making post-secondary education more accessible to Canadians. It reports on program performance through the Program's Annual Report, the Departmental Performance Report, the Report on Plans and Priorities, and its website. The Department will better articulate this performance measurement strategy in a single framework document.

2.81 Human Resources and Social Development Canada should complete a summative evaluation that focuses on program impacts and outcomes and should do so within the five years specified in its plans. (2.79)

Departmental management has adopted a five-year phased approach to the summative evaluation of the impacts and outcomes of the Canada Student Loans Program. The evaluation is under way, with the first synthesis report of the evaluative work available in 2006–07. Annual synthesis reports will be produced, culminating in a final summary report on program outcomes, which will be available in 2011.

2.87 In its Departmental Performance Report, Human Resources and Social Development Canada should consolidate and improve its reporting on key indicators of progress toward the strategic goals of the Canada Student Loans Program and clarify how the activities of the Canada Millennium Scholarship Foundation relate to its own activities and goals. It should also provide for timelier tabling of the Canada Student Loans Program Annual Report. (2.82–2.86)

As noted in the Department's response to recommendation 2.80, the Department will articulate its performance measurement strategy for the Canada Student Loans Program in one framework document. This will consolidate all existing and potential key indicators for reporting on the progress of the Program. It should be noted that availability of data for the potential indicators is a challenge as not all provinces have the same degree of preparedness for their data systems. However, the Department will work to ensure that these key indicators will continue to be monitored appropriately and results will be reported when available through future departmental performance reports. Furthermore, the Department will report on the relationship between the Canada Millennium Scholarship Foundation's activities and its own through its departmental performance reports, while recognizing the arms-length status of the Foundation. HRSDC will improve the time frame within which it tables the Canada Student Loans Program Annual Report each year.

Consultation between HRSDC and the Foundation

2.103 Human Resources and Social Development Canada and the Canada Millennium Scholarship Foundation should improve their arrangements for consulting one another on issues of mutual interest in order to achieve their shared objective. The two organizations should document their consultations and the outcomes to aid future decision making. (2.99–2.102)

Human Resources and Social Development Canada's response. Officials of the Canada Student Loans Program consult with officials of the Canada Millennium Scholarship Foundation regularly on areas of shared program objectives while recognizing the arms-length status of the Foundation. The Department will institute procedures to ensure that results of key discussions with the Foundation are recorded to aid future decision making for areas of shared program outcomes or policy development interests. In support of improved consultation, HRSDC has invited the Foundation to join the National Advisory Group on Student Financial Assistance, which will meet twice annually starting in March 2007. The results of the National Advisory Group's consultations are documented in formal minutes and records of decision.

The Canada Millennium Scholarship Foundation's response. The Canada Millennium Scholarship Foundation looks forward to continuing its consultation with Human Resources and Social Development Canada (HRSDC) in the future and will document exchanges of information when appropriate. Where improved arrangements are required, it is the Foundation's view that these arrangements acknowledge the importance of both organizations consulting not only each other but also the provinces and territories. In this regard, the Foundation welcomes HRSDC's recent invitation to join the National Advisory Group on Student Financial Assistance, a group that includes among its members both the federal and the provincial co-chairs of the Intergovernmental Consultative Committee on Student Financial Assistance. The Committee serves as the federal-provincial multilateral forum for consultation on policy and program development on student assistance. The Foundation will send a representative to meetings of the National Advisory Group beginning in the spring of 2007. In addition, the Foundation believes it would be useful to be invited periodically to attend meetings of the Intergovernmental Consultative Committee. The Foundation would welcome the opportunity to appear before the Committee annually or biannually to present an update on its operations and plans, to review issues raised in audits and other reviews, and to consult with its federal, provincial, and territorial colleagues on issues of mutual interest.