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1983 Report of the Auditor General of Canada

Synopsis

10.1 Overview. Parks Canada's activities are governed by the National Parks Act, which was amended in 1974, and by a Cabinet-approved policy statement developed after extensive public consultation. Its mandate, in summary, is to preserve the natural and cultural heritage of Canada for future generations of Canadians and to facilitate the appreciation and enjoyment of this heritage by present-day Canadians.

10.2 Natural heritage is concerned with the natural beauty of our nation; cultural heritage includes certain physical reminders of important aspects of our history as a nation. Canadians and others can appreciate and enjoy these by visiting various parks and sites maintained and operated by Parks Canada.

10.3 Parks Canada is a relatively self-contained program in the Department of the Environment. It falls within the envelope of the Ministry of State for Social Development. The program's organization is set out in Exhibit 10.1.

Exhibit not available

10.4 The parks, sites and canals have been acquired at various times throughout the past 100 years. Parks Canada is now one of the biggest owners of real property in Canada. The present replacement cost of the roads, buildings, exhibits and so on has been estimated at over $3 billion.

10.5 The 1982-83 Estimates projected Parks Canada's expenditures and authorized person-years as follows:

Expenditures
(millions of dollars)
Activity

Authorized
Person-
years

Operating

Capital

Grants
and
Contributions

Total

Administration 510 $ 23.8 $ .4 $ - $ 24.2
National Parks 2,615 82.2 63.6 .4 146.2
Historic Parks and Sites 1,216 35.2 18.0 .3 53.5
Agreements for Recreation
  and Conservation 		717 20.4 19.0 - 39.4
Contributions to Employee
  Benefit Plans 		14.6 - - 14.6
    Total Expenditures 176.2 101.0 .7 277.9
Less - Revenue (19.5) - - (19.5)
Add - Inter-department services
  provided without charge 		11.5 - - 11.5
    Total 5,058 $168.2 $101.0 $ .7 $ 269.9

10.6 The major categories of activities conducted by Parks Canada are:

    - safekeeping of the natural and cultural heritage, which is the primary responsibility of an operating unit;
    - operating and maintaining existing parks, historic sites and canals for the benefit of visitors; and
    - extending these activities by acquiring, developing and building new operating units.
Some of these activities are inherently different and result in conflicts that exacerbate day-to-day management problems. For example, conservation in some sensitive areas is not compatible with access by the public, and physical development is often in conflict with conservation of the natural heritage.

10.7 Summarized audit conclusions. Parks Canada employees at individual parks, historic sites and canals display a high degree of commitment both to meeting the needs of visitors and preserving the natural and historical heritage within the parks and sites under their jurisdiction.

10.8 Initiatives taken by Parks Canada have established a pattern of growth resulting from the approved parks system plans without providing sufficient information on the total future cost implications, in terms of both the cost of acquiring and developing new assets and the cost of operating and maintaining them. As a consequence, funding and appropriation decisions cannot be considered within the context of total future financial requirements. For example, we found that:

    - cost estimates for acquiring, developing and operating certain new and potential national parks and historic sites were, except in one instance, incomplete or non-existent;
    - a backlog of recommendations made by the Historic Sites and Monuments Board for the commemoration of certain historic places represents a potential future obligation for Parks Canada to provide assistance or direct investment;
    - a number of long-standing, unresolved operational problems represent probable future commitments; and
    - planning and control of the development process were inadequate.
10.9 Parks Canada does not provide the information necessary to indicate how well it is fulfilling its mandate, nor does it have formal procedures to hold its employees accountable for producing the results necessary for delivering its program. For instance:

    - attendance statistics lack credibility and do not constitute a reliable measure of park use;
    - reported national economic impact of $849 million in 1980-81 is, in our opinion, overstated, because it represents an aggregation of program expenditure and estimated visitor spending, plus the respending of these dollars by recipients, and does not take into account that a significant proportion of this spending is largely a redistribution of resources;
    - specific program results are not adequately defined, evaluated or costed out; and
    - systems are not in place to provide cost comparisons with other similar activities.
10.10 Systems required to supply the information needed for managing park operations have not always been developed in the most economical and efficient way.

10.11 Parks Canada has not managed certain of its professional staff resources in a manner that would ensure their most effective use in delivering its program. A review of a 20 per cent sample of professional and support staff in headquarters and the regional offices indicated that there is a need to reassess the use of professionals, since:

    - professional advice is not readily available to appropriate levels of management;
    - appropriate authority has not been granted to functional managers;
    - professional services are not provided on the basis of program priorities; and
    - the use of professionals and their work is not adequately controlled.
10.12 Parks Canada has not determined the most appropriate approach to follow in dealing with the future of the townsites of Banff and Jasper in the context of their impact on program resources and objectives. This has had the following consequences:

    - external pressures for development in the townsites have not been dealt with effectively;
    - services are provided to townsite residents at less than cost; and
    - scarce resources are diverted away from operating the national parks of Banff and Jasper and into the two townsites.
10.13 Parks Canada's philosophy and policy relating to visitor-generated revenue result in visitors being treated inconsistently and receiving subsidized services.

10.14 Parks Canada management was aware of several of the problems which are commented on in this chapter. In some instances, management had already initiated corrective action and, in other cases, it was contemplating doing so.

Audit Scope

10.15 Our preliminary survey of Parks Canada indicated that, at a park operating level, it appeared to be doing a good job of delivering its program to the public. It seemed to be meeting the perceived needs of the people using its facilities in a very satisfactory manner and appeared to be achieving its primary program objective of conservation and preservation with both imagination and sensitivity. In view of this, and because most of the resources are consumed in the development and access aspects of the program, the detailed audit concentrated on the following areas of resource utilization:

    - the management of major additions to assets, including acquiring and developing of new parks or sites and upgrading existing parks and sites, in view of its significance ($101 million) in relation to the total Parks Canada Appropriation ($278 million);
    - certain activities relating to operations and control, including information needed for management, the operation of the townsites of Banff and Jasper, and the fees levied on visitor attendance at parks and sites; and
    - the management of staff located at headquarters and the regional offices (chosen because of the importance of their specialist input to the delivery of the Parks Canada program and the relative materiality of this group compared to total payroll costs).

Observations and Recommendations

Managing New Park Acquisition and Development

10.16 Acquiring and developing new parks and historic sites, and upgrading existing parks and sites, add to Parks Canada's assets. These assets take the form of land, roads, campsites, buildings, exhibits, artifacts and the like. To maintain existing assets in an acceptable state of repair and to provide for needed capital replacements require a commitment of future funds. In addition, initiatives to establish new parks and sites and acquire additional assets for existing operating units will require a further future commitment of capital funds and additional operating funds, over and above the normal increases in costs associated with changing price levels.

10.17 We concluded that Parks Canada's initiatives have established a pattern of growth for the parks system without providing sufficient information on the total cost implications for the overall acquisition, development and operation of parks over a stated period of years. Therefore, funding and appropriation decisions cannot be considered within the context of total future requirements.

10.18 We examined six national parks and six historic parks, at various stages of development, spanning a period from the early 1970s to the present. In most of the cases examined, we found Parks Canada had entered into undertakings to acquire and develop new parks and sites without adequately considering the total costs likely to be involved. An exception was Grasslands National Park, where estimated costs were provided as part of the proposal. Without appropriate cost estimates, it is not possible to determine whether acquisition and development are being carried out within controllable limits. The following were major examples:

    - Parks Canada did not adequately inform Government of the estimated total cost of commitments made in an agreement with the Province of Newfoundland in 1973 to establish the Gros Morne Park. Subsequently, Parks Canada has estimated that the total capital costs of fulfilling the terms of the agreement would amount to $130 million in 1982 dollars.
    - There was no evidence of adequate cost estimates being provided prior to signing an agreement with the Province of British Columbia to establish the Pacific Rim Park.
    - In acquiring the Nitnat Triangle, part of the Pacific Rim Park, under a federal-provincial cost sharing agreement, no limit was specified in the agreement for future federal spending.
    - Properties at Dawson City were acquired for a nominal cost (in some cases for as little as $1) without clearly considering, at the time, the expenditures that would be needed for stabilizing, maintaining and developing them in the future. The photographs opposite indicate the deteriorated condition of one of these properties at the time of acquisition and the restoration which has taken place in the intervening period. A ceiling of $15 million in total capital expenditures to be associated with this undertaking has since been established. However, at the time of our audit, Parks Canada did not know the total restoration costs incurred in respect of individual properties.
    - An obligation similar to that incurred in Dawson City appears to exist in respect of a property with 35 additional buildings that was acquired in 1975 at nearby Bear Creek (an abandoned gold mining property) for $225,000. This property changed hands several times over the previous three years at prices not exceeding $10,000. Since that time, the property has not been used for the intended purposes, except as a storage facility for artifacts.
    - In one instance, Parks Canada submitted a proposal to Treasury Board for stabilization work on the substructure of Steveston Cannery, a proposed historic site for commemorating the West Coast fishing industry. Treasury Board advised Parks Canada, in July 1981, that the project required Cabinet Committee approval. Parks Canada has not yet submitted the proposal but, in the meantime, has acquired the equipment in the building for $180,000 as an artifact, with the intention of developing the building as an historic site. Cleaning and repair of this equipment alone will require an estimated $114,000. A further $300,000 has already been spent on planning and other minor items subsequent to the Treasury Board ruling, but still no comprehensive plan, with costs of building acquisition, construction/stabilization, operation and maintenance, has been produced.
10.19 Parks Canada has a backlog of recommendations made by the National Historic Sites and Monuments Board for commemorating certain historic places. These recommendations are seen by Parks Canada as an obligation of the Government of Canada and, although they may not create a legal commitment, some of them may become a future obligation for Parks Canada to provide some form of assistance or direct investment. We noted that, in 1981-82, Parks Canada had ranked the existing backlog in order of priority and had established a plan to deal with much of the backlog over a 10-year period.

10.20 In addition to future cost implications for new park acquisition and development, there are several long-standing unresolved operational problems that also represent probable future commitments. In most cases, the problems had been well identified, but there was no apparent sense of urgency to take remedial action. Examples follow:

    - At three of the national parks we visited, sewage effluent exceeded guidelines, and certain local waters have been polluted for a number of years. Regarding drinking water at the same locations, Parks Canada does not comply with its own Department's criteria for water quality and testing. At Banff, for instance, it was only after a serious outbreak of giardiasis (intestinal disorder) that decisive corrective action was initiated, at an estimated initial cost of $4.5 million.
    - Certain highways and bridges, constituting public and traffic access, were observed to be potentially hazardous and in need of attention. These included needed run-away lanes which have not been provided on certain steep grades; guard rails which were lacking or in need of repair on certain hazardous highway stretches; and several highway and trail bridges which also needed repair.
10.21 When seeking approval for new park or site establishment and development, Parks Canada should estimate the total costs for the new park or site as a whole. These costs should be described in terms of both capital and operating requirements for the development period as well as the continuing operational and maintenance requirements once development is complete.

Parks Canada response: Estimates for establishing a new park or site include acquisition costs and the known development package. Usually, this initial development package is the result of negotiation and consultation with the province and with the public. These costs are now being developed along the above lines.

10.22 Regarding the systems and controls associated with developing new parks, we found several cases where no park development plan had been completed, despite significant development expenditures. Where development plans for individual national parks had been completed, they did not contain cost estimates, although, in the case of some of the historic parks, development plans did contain financial information.

10.23 Planning for development of a park is often fragmented and not done on a timely basis. Staff input into planning within Parks Canada has not always been properly co-ordinated, resulting in unclear responsibilities and authorities. Parks Canada has made an effort to review roles and responsibilities and resolve this problem, particularly regarding headquarters and regional roles. This review has been under way since 1978.

10.24 There is no formal monitoring and reporting on the progress and expenditures relating to a park, as an entity, through its identification, establishment and development. Expenditures are monitored only on the basis of individual capital projects. This does not provide adequate financial control over the development of the park as a whole. Parks Canada does not clearly communicate to Parliament its resource requirements for park development. The Estimates list only the funds required for individual capital projects, without identifying them as part of total park development or showing the costs of such development.

10.25 Parks Canada should develop and implement an appropriate planning and control system for use during the development period of a new park or site. The system should ensure that projects are begun only after the appropriate approvals are in place; responsibilities and authorities are clearly assigned; costs are properly accumulated and compared with target levels; and progress is monitored in relation to an approved schedule. Government and Parliament should be adequately informed of the total scope of the project and the progress being made.

Parks Canada response: Control of and reporting on progress and expenditures related to establishment of new parks and sites is undertaken by individual managers in the organizational levels where development activity occurs. It is true that monitoring all the development pieces does not provide an integrated reporting process for the whole. There is now a more detailed systems planning process technical manual being developed that will enable Parks Canada to put into place an improved control system for new park development work.

Information Relating to Program Delivery

10.26 As in other departments and programs, managers in Parks Canada need appropriate information to hold employees accountable for producing results related to the delivery of the program. They also need this information to communicate to central agencies and Parliament their resource needs and to indicate how well they are doing with the resources provided to them. There is a further requirement that they be able to satisfy themselves that this information is being acquired in the most cost-effective manner.

10.27 We observed that Parks Canada does not have adequate information relating to how well it is doing. For example, processes are not yet in place to supply appropriate costs and other data regarding its major operational activities. As a consequence, in communications with senior management and central agencies, some program information is limited. For instance, little information is presented to describe Parks Canada's primary mandate of conservation and preservation. Parks Canada does produce information on attendance at parks and sites, such as visits, facility usage, interpretation, and so on, and on the general economic impact of the program. However, in the form presented, this information is susceptible to misinterpretation. In setting up systems and procedures to obtain these data, Parks Canada also has not always employed cost-effective and efficient approaches. These observations are discussed in more detail in the following paragraphs.

Communicating with Government and Parliament
10.28 The Department of the Environment prepared and presented to Parliament, in February 1983, its first Expenditure Plan (Part III of the Estimates) for the Parks Program. This additional information is directed toward improving the Government's accountability to Parliament by providing more and better information on each program, particularly with respect to program performance and resource justification. Since this was the first attempt to provide such information for the Parks Program, we did not conduct a detailed review of the Departmental Expenditure Plan relating to the Parks Canada Program. However, we believe that a number of recommendations in this chapter would provide Parks Canada and the Department of the Environment with an improved basis for future Expenditure Plans.

10.29 Attendance statistics. These statistics are often used by Parks Canada in communications to central agencies, Parliament and the general public. In fact, they are among the main specific indicators used to demonstrate program performance. Some recent uses of these data include Part III of the Estimates, written responses to the Public Accounts Committee and the Department of the Environment's annual report. In none of these were descriptions included to explain how the figures should be interpreted.

10.30 For example, many popular national parks have highways running through them. These undoubtedly encourage people to visit the parks. They also carry high volumes of traffic which are not park-related. In the western mountain parks, the TransCanada Highway runs through Banff, Yoho, Glacier and Revelstoke National Parks. The Yellowhead Highway runs through Jasper, and Highway 93 runs through Kootenay. Each of these highways is crucial to the east-west flow of traffic through the mountains.

10.31 The definition of a "visit" used by Parks Canada for compiling attendance statistics is the entry of a non-resident, tourism-related traveller into the park or site being reported. This definition, or caveat, is not included in the above-mentioned external communications and results in Parks Canada reporting as visitors those persons who are using the highways as a transportation route rather than as a means of gaining access to use the park. Through traffic, as described above, is exempted from paying an entrance fee to the park.

10.32 The examples below illustrate the extent to which through traffic influences attendance data reported to central agencies and Parliament.

10.33 In 1981-82, Parks Canada reported that 21 million people visited national parks. More than half of this total (11.9 million) was reported by the six mountain parks containing through highways. The figure of 11.9 million included 4.7 million through travellers. In the cases of Glacier and Revelstoke National Parks, the number of visitors reported for 1981-82 was 2.5 million, of which through traffic comprised 2.1 million, or 84 per cent.

10.34 Similar situations exist for Kootenay, Yoho (which counts vehicles only at the east gate) and Jasper, although at Banff, Parks Canada does adjust its figures to take out estimated through traffic. In Eastern Canada, we reviewed Terra Nova, Gros Morne and Fundy National Parks, which also contain through highways and have inconsistencies in attendance reporting.

10.35 Our detailed audit findings also revealed numerous compilation errors, inconsistent counting methods, multiple counts of visits, and obsolete or inconsistent conversion factors for estimating passengers in recorded vehicles, to arrive at reported attendance. For example, vehicles entering the south gate at Jasper are assumed to have an average of three occupants, whereas at Yoho, vehicles are assumed to have 2.5 occupants. In Banff, yet another factor is used. We could find no recent data to support these conversion factors. These variations serve to emphasize the inconsistencies in the statistics.

10.36 Parks Canada is taking steps to improve counting methods and accuracy, but has not yet resolved the issue of how to measure park use. In the meantime, it continues to report attendance statistics without distinguishing between people who are essentially through travellers and those who gain a fuller experience through a short visit or a longer stay.

10.37 Visits to historic parks and sites were reported at 4.7 million in 1981-82. Although this total appears to be substantially correct, data from some sites suffer from errors and inconsistencies. An extreme example is the Halifax Citadel, where entrants are counted at the gate (a reasonable basis) and reported to headquarters, where the reported numbers are inflated by 50 per cent before being published. For 1981-82, this practice increased reported visits by about 170,000.

10.38 Records are kept of boats passing through the locks of Heritage Canals, but the number of shore-based visits to the canals is not yet reported. Measurement of such visits is currently being considered by Parks Canada.

10.39 In our opinion, published attendance statistics lack credibility and do not constitute a reliable indicator of park use.

10.40 Parks Canada should re-examine its definition of a "visitor", together with related data collection and reporting methods, with a view to establishing:

    - a definition and classifications that reflect, with reasonable accuracy, the purpose of each visit;
    - methods of data collection that facilitate collecting and reporting data in a reliable, consistent, meaningful and cost-effective manner; and
    - a reporting approach that facilitates understanding and minimizes misinterpretation of its attendance statistics.
Parks Canada response: Parks Canada is developing systems and procedures that respond to the concerns about visitor definitions, data collections and reporting.

10.41 Economic impact. Parks Canada, in a number of formal submissions, including the 1983-84 Part III of the Estimates and a report to the Public Accounts Committee, has reported that its program contributed $849 million to the Canadian economy in 1980-81, as shown below:

(millions of dollars)

Program spending $221 26%
Re-spending of program disbursements 132 16
Visitor spending 310 36
Re-spending of visitor disbursements 186 22
$849 100%

That is, for every dollar of its budget, approximately three dollars were returned to the economy. It also reported that it had generated in excess of 50,000 jobs.

10.42 Approximately $353 million, or 42 per cent, of the economic impact estimated by Parks Canada results from spending its own parliamentary appropriation and the re-spending of it. Since the budgetary resources were drawn in the first place from the Canadian economy, they do not necessarily represent an addition to national economic activity.

10.43 The remaining $496 million, or 58 per cent of the claimed economic impact, is due to spending by visitors to parks or sites or re-spending by the recipients. Parks Canada, by attracting domestic tourism, probably prevents some spending from taking place outside Canada and, by attracting foreign tourists, encourages additional spending to take place in Canada. This has a favourable impact on Canada's foreign exchange position, and represents valid incremental economic benefits. It is not made clear, however, that tourist spending attributed to Parks Canada facilities might, in any event, have been spent elsewhere in Canada.

10.44 These data are published without the benefit of interpretive caveats to provide readers with a guide to their use. As a result, they can be misinterpreted and consequently may be misused. Publication of these data by Parks Canada without qualification gives the impression that the economic contributions are generated exclusively by, and would not exist without, the program. In practical terms, this may not be correct.

10.45 Parks Canada has subsequently estimated the economic impact of the program for 1981-82. We were informed that the impact was $740 million, with 29,457 person-years of employment, including 5,058 Parks Canada staff. We have not examined these data, which were prepared on a basis similar to that used the previous year.

10.46 Parks Canada should ensure that information on the economic impact of its activities is presented to Government and Parliament in such a way that possible misinterpretation is minimized.

Parks Canada response: Estimating the direct, indirect and induced impact of Parks Canada and visitor expenditures on the national economy is largely an interpretive process. Parks Canada agrees that conclusions must be stated in the clearest possible manner to avoid misrepresentation.

Assisting Management of Parks Canada
10.47 Parks Canada needs appropriate information to manage the program and hold its employees accountable for results. This means that employees should have a clear view of how the activities for which they are responsible are contributing to achieving the required results. This requires both a performance measurement system, to indicate the degree of success in achieving results, and an appropriate accounting system, to make visible the cost of doing so. Assigning appropriate responsibility for achieving particular results would follow.

10.48 We noted that Parks Canada does not yet have a comprehensive framework, or program activity structure, for defining packages of results. Within Parks Canada, this framework would likely include, but not necessarily be limited to, the following activities:

    - conserving, preserving and restoring natural and cultural heritage;
    - interpreting this heritage for the appreciation and enjoyment of visitors;
    - sustaining the visitor to the park or site by providing food, accommodation and recreation;
    - providing visitor access by building and maintaining roads within park and site boundaries for vehicular traffic and by building and maintaining trails and walkways for suitable access to the more remote regions of the park or site; and
    - providing services to other than visitors, including municipal services to certain park townsites, roads in parks for through transportation rather than visiting, and land leases for residential and business purposes.
10.49 Further, Parks Canada does not have an adequate cost accounting capability. As a result, it is unable to readily:

    - ascertain the cost of its major activities;
    - determine the cost of achieving intended results;
    - make comparisons with similar functions outside the parks system, such as private sector campgrounds, golf courses, municipal services and the costs of building and maintaining roads; or
    - establish an appropriate fee structure to allow for recovering the costs of certain of its visitors' services.
10.50 Finally, Parks Canada does not have a well developed measurement system to supply data for performance measures and tests of efficiency. However, we noted that, in the case of a number of operational activities (such as cutting grass, collecting garbage, providing campsite facilities and the like), appropriate performance measures were in place, and several current initiatives will result in future improvement. For example, the Maintenance Management System currently being implemented by Parks Canada should improve performance measurement and help to improve the efficiency of many other activities at the operating level. Similarly, a cost distribution system is being developed in conjunction with an improved program activity structure that may improve accountability.

10.51 Parks Canada should:

    - ensure that its revised program and activity structure will enable it to measure results in significant areas of its activities;
    - consider supplementing the cost distribution system currently being developed with a full cost accounting and reporting system; and
    - implement additional appropriate performance measures that will enable managers to hold their subordinates accountable for relevant aspects of program delivery.
Parks Canada response: Parks Canada has assigned a high priority to the development of an operational planning system. The program activity structure is being revised in line with Treasury Board Operational Planning requirements, and the component parts of the overall system, including work plans with appropriate performance measures, are being developed.

Acquiring Needed Information
10.52 Processing data into information suitable for accountability within Parks Canada and for communicating with Government and Parliament requires the design and implementation of co-ordinated processes that match costs with operational outputs in an appropriate manner. These are often computer-based, and financial data are usually a major common input.

10.53 We observed that Parks Canada, in setting up systems and procedures to obtain needed management information, has not always developed its management information systems in a co-ordinated, cost-effective and timely manner.

10.54 Independent systems have been developed without adequate assessment of information needs and the possibility of integration with other systems. Systems were not co-ordinated to take advantage of any potential common elements or shared uses. For instance, the financial management system, which was a departmental initiative, was introduced in 1982 without taking into account the data needs of major information systems under development in the Engineering and Architecture, the Program Planning and Analysis, and the Socio-Economic Divisions. Logically, the financial management system would be expected to form the core of many of these other systems where cost or other shared information is required.

10.55 In some cases, the analysis of costs and benefits prior to systems implementation was inadequate. Managers needs were not clearly determined. Sometimes, the potential of the systems was overstated, with the result that some systems have failed to meet expectations. As an example, the financial management system, which is a purchased service, has not provided all the reports originally envisaged. Parks Canada has experienced significant difficulty in reconciling data to the central financial records of Canada. This failure on the part of the system supplier made it necessary for Parks Canada to consider costly alternatives and for operating managers to retain self-initiated, informal systems. In addition, the full costs of implementing the system had not been identified at the time of our audit.

10.56 Parks Canada should ensure that all new systems are compatible with existing or other proposed systems and can share common data, where appropriate, for maximum efficiency and cost-effectiveness.

Parks Canada response: Directives and procedures have been developed for the planning and development of systems in Parks Canada which will establish a mechanism to ensure that all relevant management functions are involved in the development of systems. This process should produce co-ordination of effort and maximum efficiency in system development.

Managing Professional Staff

10.57 Of Parks Canada's 4,515 operational and administrative person-years, 1,433 (31.8 per cent) are located in five regional offices and the National Capital headquarters. Exhibit 10.2 indicates the distribution of person-years among headquarters, regional offices and operations. Among the professional staff in headquarters and the regions, the available expertise includes such functions as engineering and architecture, interpretation, natural resource conservation, archaeological research, historical research, cultural resource conservation, socio-economic research, realty services and so on.

Exhibit not available

10.58 The roles of the professional staff in headquarters, and to a lesser extent in the regions, are to provide specialist advice to senior management, exercise functional authority over their counterparts in the field, and provide specialist services to the field.

10.59 We reviewed the activities of a sample of 20 per cent of the professional and support staff, selected as follows:

    - 156 person-years associated with the engineering and architectural function at headquarters and 2 regional offices;
    - 230 person-years associated with the historic parks and sites activity at headquarters; and
    - 20 person-years associated with the socio-economic function at headquarters.
10.60 The majority of the individual employees in this sample of professional staff appeared to be dedicated to the objectives of the Parks Canada program, highly motivated and very knowledgeable in their areas of expertise. However, we found that, in general, they had not been managed in a manner that would ensure their most effective use in meeting the needs of the Parks Canada program. For the most part, these staff resources were being used to provide a variety of services on an as-requested basis instead of in accordance with any predetermination of program priorities. Furthermore, attempts to carry out a form of functional management normally associated with a headquarters function were generally ineffective.

10.61 The Engineering and Architectural function at headquarters. We found that, in the following ways, this group was not performing a role commensurate with its senior position relative to the more than 1,600 engineering, architectural and general works personnel in the field.

    - The majority of its available resources (56 out of a total of 84 person-years) was engaged in providing specialist services to various parts of the program in headquarters and the field. However, the provision of these services tended to be on an as-demanded basis as opposed to being allocated in accordance with predetermined program priorities.
    - Resources devoted to functional management were constrained by the absence of properly articulated and communicated responsibility.
    - The development of directives, policies, standards and guidelines was limited, for the most part, to highly specialized areas with limited national applicability. Other guidance, related to more general areas, did not appear to be widely used in the field.
    - Fewer than three person-years were used to evaluate the quality of the delivered product. The only formal review took place at the project proposal stage. Subsequent reviews were limited to sporadic inspections carried out during the course of field trips and occasional reviews of the finished product. These were insufficient to assess adequately how well the engineering, architectural and general works functions were being carried out.
    - Insufficient information was received in headquarters to allow appropriate monitoring of project performance and the provision of advice, on a timely basis, to senior management.
10.62 Historic parks and sites activities at headquarters. The activities of this group of 230 person-years could be categorized in the following three areas:

    - practising functional management relative to their field counterparts;
    - providing some form of specialist services to the field or delivering some aspects of the Parks Canada program; and
    - providing research and secretarial services to the Historic Sites and Monuments Board of Canada.
10.63 The practice of functional management involved 39 person-years. This took the form of producing and issuing standards and guidelines for use in the field and providing training, advice or other aspects of functional guidance. We found the standards and guidelines activity to be somewhat ineffective in view of the following:

    - managers' responsibility for setting standards and guidelines had never been properly defined or communicated;
    - considering the number and scope of historic parks and sites activities, very few standards and guidelines had been issued; and
    - the standards and guidelines currently in preparation did not appear to be addressing the current priorities of the program.
10.64 Most of the 122 person-years providing specialist services to the field or delivering some aspects of the program from headquarters were not being adequately managed. We reviewed numerous projects and observed the following:

    - projects were seldom identified in accordance with any set of program priorities;
    - there was seldom any limitation on either the resources to be consumed or the time to complete the project;
    - there was no evidence of periodic reviews being carried out to see that projects were on course and still relevant in relation to program priorities;
    - cumulative project costs were unknown; and
    - there were no status reports going to senior management.
10.65 In general, the activities of this group (relating primarily to military themes) appeared to be influenced by the highly specialized nature of the employees comprising the group. As a consequence, there is an inherent inflexibility in responding to desired changes in direction to meet changing program priorities. This is significant, because the need to change direction has been appreciated by Parks Canada since the early 1950s when the Massey Commission identified a thematic imbalance in the commemoration of historical sites and events. Parks Canada has been attempting to address this imbalance through developing a systems plan. However, very little progress has been made.

10.66 Approximately 36 person-years are deployed to provide secretarial, research and other related assistance to the Historic Sites and Monuments Board of Canada.

10.67 The Board was established by statute in 1953, as an entity independent of Parks Canada, to advise the Minister on the commemoration of historic places. Although the Act gave the Minister the power to assign departmental personnel resources to the Board, no direct relationship between it and Parks Canada was envisaged. The relationship established by the Act requires the Board to advise the Minister; the Minister, taking the Board's advice into account, may direct Parks Canada to commemorate certain historic places; Parks Canada is then obliged to implement the Minister's decision.

10.68 We observed that the affairs of the Board have become increasingly integrated with those of Parks Canada. In effect, Parks Canada assigns resources to the Board without the explicit approval of the Minister. There are three major consequences of this integration:

    - the independence of the Board could be jeopardized in that the same employees are often working simultaneously for both Parks Canada and the Board;
    - there is no way of recognizing or reimbursing Parks Canada for the Board's use of program resources not directly used in delivering the parks program; and
    - the Minister and Parliament do not know the full costs of operating the Board and, therefore, cannot hold it accountable.
10.69 Socio-economic function. This function comprises 20 person-years. It devotes the majority of its resources, on an as-requested basis, to the following:

    - analysis of the demand for visitor services, mainly as a budgetary support to ensure that proposed capital projects for visitor services are designed according to the projected demand;
    - various studies for the field and headquarters of a socio-economic nature;
    - functional guidance to the field for performing various statistical analyses; and
    - issuance of standards and guidelines for use by the field when carrying out work of a socio-economic or statistical nature.
10.70 We found that there was scope for improving the use of professional staff within this function.

    - Limited attention is paid to advising senior management on how visitor attendance statistics and economic impact analyses should be interpreted. Comment on the potential for likelihood of misinterpretation has already been made earlier in the chapter.
    - The function is not offering advice to senior management on the socio-economic impact of the Parks Canada program compared to similar federal, provincial, municipal and private sector activities.
    - The function is rarely used in the decision-making process leading to the acquisition of a new park or site. Its use is mainly restricted to analyses of specific projects once the major acquisition decision has been made.
10.71 Some of these deficiencies in the management of its professional resources had already been noted by Parks Canada, and initiatives were under way to deal with them. In particular, Parks Canada is involved in a reorganization of headquarters, establishment of roles and responsibilities throughout the entity, and an A-base budget review.

10.72 In conjunction with current initiatives, Parks Canada should take measures for more effective use of its professional staff by ensuring that:

    - professional advice is available to management at the appropriate levels;
    - responsibilities of functional managers are defined and communicated;
    - professional services are allocated in accordance with program priorities;
    - the professional output is monitored and controlled; and
    - staffing levels are established in accordance with demonstrated program needs.
Parks Canada response: Parks Canada is involved in an intensive exercise to improve accountability for both functional and line management. Roles and responsibilities have been developed for all functions. Work planning procedures are being formulated to ensure that professional advice and direction are planned and provided for all functions and that the professional services required at each level are provided in an effective manner.

10.73 Parks Canada should review its relationship with the Historic Sites and Monuments Board and its current interpretation of the Historic Sites and Monuments Board Act with a view to:

    - ensuring the independence of the Board; and
    - displaying explicitly to Parliament the resources currently consumed by and for the Board.
Parks Canada response: The professional integrity and objectivity of the Historic Sites and Monuments Board of Canada is essential to the fulfilment of program objectives. Board members and Parks Canada officials will continue to safeguard the nature of the relationship of this advisory body with the Minister. Board costs can be separated from other activities under the Act with the current financial system.

Resolving the Status of Banff and Jasper Townsites

10.74 Significant townsites have developed in the National Parks of Banff and Jasper and, to a lesser extent, in other locations. The Banff and Jasper Townsites each have permanent populations in excess of 3,500, with seasonal variations that bring Banff up to 5,000 in the summer and Jasper to more than 4,300. As managers of these townsites, Parks Canada generally and the Park Superintendents in particular need to provide adequate municipal services. At the same time, they need to manage the affairs of the municipalities in a cost-effective manner that will:

    - meet the residents' needs;
    - provide appropriate visitor services;
    - control future development consistent with the policies of Parks Canada, such as conservation; and
    - reduce the financial and administrative burden on the program budget.
10.75 The following needs are implicit in these management requirements:

    - provide the residents with municipal services, such as garbage collection and utility services, and recover the costs of those services through a form of municipal taxation;
    - provide for the general safety of residents and visitors;
    - deal with individual businesses to negotiate and administer land leases, concessions and licences;
    - deal with individual residents holding land leases for residential purposes;
    - monitor both business and residents to make certain that their continued tenancy is consistent with Parks Canada policy and the terms of the individual concession or lease; and
    - react to a range of conflicting pressures from politicians, businesses, groups and individuals for dealing with aspirations and problems specific to the townsite as a community.
10.76 As a result of our review of how Parks Canada has managed these two major townsites, we concluded that it had not adequately resolved several important and long-standing operational problems.

10.77 Parks Canada's policy states that the towns of Banff and Jasper are visitor services centres whose boundaries are fixed. In the case of Banff, proposed changes to zoning would permit significantly increased densities which could have an effect on the program's primary mandate which emphasizes "ecological and historical integrity" - minimum disturbance of the original natural environment.

10.78 A second issue is local self-government for Banff and Jasper. A previous initiative in this direction was not adopted by the residents. We note, however, that Parks Canada still sees this as a future option; the 1983-84 Estimates (Part III) state as a program objective the introduction of amendments to the National Parks Act to provide for the future self-government of Banff and Jasper.

10.79 Examples such as these lead us to conclude that Parks Canada has not adequately resolved the future of the townsites within its own park policies. However, we noted that the program is currently implementing a planning process for the four mountain parks that should clarify these and other issues.

10.80 Controls over the development of the townsites were not effective, due, in part, to the absence of adequate town plans. This made it difficult for the program managers to deal adequately with the pressures for development from the private sector. For example, Parks Canada and the private sector occasionally exchange parcels of land inside parks and particularly within townsites. In 1982, an exchange took place in an attempt to preserve one area of Banff from high-density residential development. In doing so, Parks Canada had not identified, and consequently had not complied with, all appropriate authorities and controls of central agencies and Parliament. This land exchange involved a differential in values of approximately $550,000, favourable to the developer. Of this, approximately $400,000 was rationalized by Parks Canada on the basis of social values to the park. In accordance with its customary practice in such transactions, Parks Canada assumed this transaction was within the authority of the Minister and did not seek Treasury Board approval, even though, some months before, an earlier version of the proposal had been formally submitted to the Treasury Board because it contained an unusual method for payment. This earlier proposal was rejected by the Board, which also noted that the normal procedures involving public advertising for tenders, requiring large payments up front and a share for the Crown in the income from the development ought to be followed in transactions of this type.

10.81 These procedures, suggested by the Treasury Board, were not followed by Parks Canada in adopting the second proposal, since it was considered to be consistent with practices followed by the program in earlier land transactions. The transaction was tantamount to Parks Canada acquiring $970,000 of leasehold assets and disposing of others valued at $1.5 million, and is an example of an unauthorized vote-netting practice. As a consequence, it was not subjected to the normal parliamentary approval process.

10.82 The right to live in townsites is governed by regulation. However, monitoring compliance is not carried out systematically.

10.83 The issue of who should pay for the townsites was addressed in a 1977 Cabinet directive, which authorized the preservation of nominal rent for residential leases, if the towns of Banff and Jasper became financially self-sufficient by local self-government or by paying the full costs of service. This was confirmed in 1980. If Parks Canada were relieved of the burden of townsite management, it was estimated at that time that $4.5 million (including 47 person-years) could, if needed, become available for reassignment to other park tasks and needs. Parks Canada pursued the local self-government option, which was ultimately rejected. Although some increases were made in utility charges, full cost recovery was not realized. This was mainly as a result of delays in identifying relevant costs and the introduction of the Government's 6 and 5 Program. Residents continue to benefit from nominal rents. Specifically, we noted the following:

    - Townsite operating costs are partially buried in general park costs, and no system currently exists for correctly identifying them. At the time of our audit, a cost identification system was being developed in which it is intended that direct townsite operating costs will be identified.
    - Parks Canada has not acted on a previous recommendation that a townsite accounting system, compatible with those used in similar sized Alberta communities, be adopted. As a consequence, comparison of costs with other Alberta municipalities is not possible.
    - Parks Canada charges to residents and businesses do not include costs of municipal services relating to roads, sidewalks, snow removal, fire and ambulance services.
10.84 In the case of Banff, we estimated that the cost in 1982-83 to Parks Canada of operating the townsite was $1.7 million. This does not include related capital expenditures or the time of personnel located in the regional office and headquarters. Since only $.6 million was recovered through billings to residents, the unrecovered cost of $1.1 million, or approximately $325 per resident, is effectively a subsidy by Parks Canada. This subsidy will be reduced somewhat in that Parks Canada also consumes some municipal services and should pay an appropriate share, although the extent of that share is not known. Also, if the town were under provincial jurisdiction, it would be eligible to receive grants toward municipal expenses, estimated by Parks Canada to be between 11 per cent and 16 per cent of the total costs. Because the town is federally operated, a similar grant may have to be paid by Ottawa. Alternatively, residents of provincial municipalities pay for capital works and municipal financing through local taxation; residents of Parks Canada towns do not. A situation similar to this also exists in Jasper.

10.85 The consequences are that:

    - residents who comply with the need-to-reside regulation pay rents at a lower rate, resulting in a cost to the federal government of approximately $3.5 million a year;
    - residents are receiving municipal services at less than cost from the Parks Canada program;
    - Parks Canada is obliged to devote substantial resources to municipal management that could be used elsewhere for activities more relevant to its mandate; and
    - Parks Canada is unable to measure the operating cost-efficiencies of these townsites against those of other similar sized communities.
10.86 Parks Canada should clarify the status of the park townsites and its relationship with them in the context of its approved policy and ensure that its costs are minimized and that implicit subsidies are either eliminated or explicitly displayed to Parliament.

Parks Canada response: Consultation and negotiation with townsite residents is an ongoing process in Parks Canada. This process is being continued to pursue the objectives listed above.

10.87 Parks Canada should ensure that future land transactions comply with all applicable authorities, including, where appropriate, Treasury Board approval.

Parks Canada response: Parks Canada and Treasury Board are clarifying and rewriting guidelines for this process. These guidelines will direct future activity.

Revenue Policy

10.88 Visitors to parks and sites generate revenue for the Consolidated Revenue Fund by paying entrance fees to some parks and sites and by paying user fees for services such as camping, swimming, golfing, the use of canal locks and so on.

10.89 During 1982-83, Parks Canada generated approximately $21.6 million in revenue (around 7 per cent of total expenditures) from the following sources:

(millions of dollars)
Entrance fees $3.2
Visitor services fees 6.6
Land leases and concessions 7.7
Miscellaneous 4.1
$21.6

Exhibit 10.3 shows total revenues and three main groupings of revenues over the past five years.

Exhibit not available

10.90 The entrance fees in total in 1982-83 amounted to $3.2 million, or approximately 1 per cent of the total Parks Canada annual appropriation. Fees for visitor services in 1982-83 amounted to $6.6 million, or 2.7 per cent of the appropriation. Thus, total visitor-generated revenue amounted to only 4 per cent of the total Parks Canada annual appropriation of $284 million in 1982-83.

10.91 Parks Canada levies vehicle entrance fees at 19 of 29 national parks and personal entrance fees at 4 of 82 historic parks. It also levies specific user fees at visitor service facilities such as pools and campsites, and lockage fees on heritage canals. The policy for setting user fees for visitor facilities is to recover only direct operating and maintenance costs and not to recover capital or infrastructure costs. Fee levels have not kept pace with increases in costs; for example, lockage fees on Heritage Canals have not been increased since 1976.

10.92 Parks Canada does not monitor compliance with its entrance fee structure. For example, it estimates that 45 per cent of all vehicles entering parks do not pay the fee, many as a result of genuine exemptions such as for through traffic, but others are a result of false declarations of intent at the gate. There is little concerted effort to monitor those in the latter category. In many parks, those passing through pay no fees but are reported as visitors. Management does not require reports on revenues collected.

10.93 These findings, along with those discussed in previous sections of this chapter, have led us to the conclusion that Parks Canada has not fully thought through what its user-pay philosophy should be, does not ensure that the user-pay policies are applied equitably and consistently and does not have the cost information needed to do so.

10.94 Parks Canada should review its entrance fee philosophy for all its parks and sites to ensure consistent and equitable treatment of visitors. It should also rationalize and keep up to date its fee structure for visitor services in a manner consistent with recovering whatever portion of Parks Canada's costs is considered appropriate in accordance with general government policy.

Parks Canada response: Parks Canada is presently preparing a paper on entrance fee policy for submission to Cabinet. The paper will address the concerns listed.