Legislative Assembly of Ontario

ANNUAL REPORT, PROVINCIAL AUDITOR, 1992
MINISTRY OF COMMUNITY AND SOCIAL SERVICES

CONTENTS

Wednesday 20 January 1993

Annual report, Provincial Auditor, 1992

Ministry of Community and Social Services

Dr Charles E. Pascal, deputy minister

Alison Fraser, acting director, policy development and program design branch

Andre Iannuzziello, project manager, cost containment implementation

John Stapleton, acting director, special projects secretariat

Shirley Hoy, assistant deputy minister, social assistance and employment opportunity

STANDING COMMITTEE ON PUBLIC ACCOUNTS

*Chair / Président: Mancini, Remo (Essex South/-Sud L)

*Acting Chair / Président suppléant: Duignan, Noel (Halton North/-Nord ND)

*Vice-Chair / Vice-Président: Cordiano, Joseph (Lawrence L)

*Callahan, Robert V. (Brampton South/-Sud L)

Cousens, W. Donald (Markham PC)

Frankford, Robert (Scarborough East/-Est ND)

Haeck, Christel (St Catharines-Brock ND)

*Hayes, Pat (Essex-Kent ND)

Johnson, Paul R. (Prince Edward-Lennox-South Hastings/Prince Edward-Lennox-Hastings-Sud ND)

*O'Connor, Larry (Durham-York ND)

*Sorbara, Gregory S. (York Centre L)

Tilson, David (Dufferin-Peel PC)

*In attendance / présents

Substitutions present / Membres remplaçants présents:

Farnan, Mike (Cambridge ND) for Mr Frankford

Fletcher, Derek (Guelph ND) for Mr Johnson

Hope, Randy R. (Chatham-Kent ND) for Ms Haeck

Jackson, Cameron (Burlington South/-Sud PC) for Mr Tilson

Marland, Margaret (Mississauga South/-Sud PC) for Mr Cousens

Also taking part / Autres participants et participantes:

Amrite, Dinkar P., director, ministry and agency audit branches

Peters, Erik, Provincial Auditor

Clerk / Greffière par intérim: Deller, Deborah

Staff / Personnel: McLellan, Ray, research officer, Legislative Research Service

The committee met at 1011 in room 151.

ANNUAL REPORT, PROVINCIAL AUDITOR, 1992
MINISTRY OF COMMUNITY AND SOCIAL SERVICES

The Chair (Mr Remo Mancini): The standing committee on public accounts is called to order. We are continuing with our review with officials from the Ministry of Community and Social Services. I've still got the elevating devices services on my mind. Deputy Minister Charles Pascal and other witnesses have been here since yesterday morning, answering members' questions. I can't recall, at the close of the day yesterday, who finished off the last round, but I've not allowed the government members to start the rotation very often, so this morning, if they wish, the government members can lead off. You have 15 minutes, Mr Duignan.

Mr Noel Duignan (Halton North): On a point -- it's not really a point; it's just information. I sat in the chair yesterday evening, and I think we started a rotation yesterday, if I'm not mistaken.

The Chair: Yes.

Mr Duignan: I think Mr Callahan served notice of a motion yesterday evening as well.

The Chair: Were we to deal with that notice of motion first thing this morning?

Mr Robert V. Callahan (Brampton South): I'd like to address it, Mr Chair. Perhaps we'll do that within the 15 minutes of our rotation.

The Chair: I understand we have copies of the motion coming.

Mr Callahan: Okay, that's fine. In the interim, you'll find that the auditor has provided us with the 1990 annual report, in which central collection was referred to. It makes for interesting reading. However, the motion, when you do get it before you -- and I'm sure you can remember it from yesterday -- was that --

The Chair: Actually, I can read the motion from the log so that we all have an understanding of what happened yesterday.

Mr Cameron Jackson (Burlington South): On a point of order, Mr Chairman: I believe that we're doing new business and are not in a rotation. I hope that's your ruling, because if you're going to limit motions by time allocation in this regard as well --

The Chair: No, I'm not.

Mr Jackson: Then I hope that we are basically dealing with new business here, Mr Callahan's motion.

The Chair: Right.

Mr Jackson: Okay, thank you.

The Chair: You're welcome. Yesterday, Mr Callahan gave notice of motion. It reads as follows:

"That the auditor, under section 17 of the Audit Act, conduct a special audit of the Ministry of Government Services central collections division, with specific reference to the annual budget, number of employees, amount of collections referred to it; specifying the ministries and the amounts referred and the total received for the years 1989 through 1992-93 with the amounts successfully collected and any other relevant facts."

That was Mr Callahan's notice of motion.

Mr Callahan: We did get information from the auditor, for which I thank him, which is on the members' desks. In the 1990 annual report, there was a review done of this Government Services central collection service. However, I suggest to you that although it's interesting reading, I think it demonstrates a definite need for improvement; there has been really none since 1990.

If you look at the handout that we got yesterday from research, there was some $138 million to $140 million worth of bad debts handed over to this group. The projected item in the estimates of the Ministry of Government Services was that there would be approximately $14 million recovered. That's a pretty sad state of affairs in terms of recovery.

Somebody pointed out to me that perhaps in the case of soft services such as social services, you don't expect to recover that much, but I'm sorry, I think what we're doing if we allow this to continue without looking into the matter further is that we're going to have an impact on the security of those safety nets that are important to all Ontarians and all Canadians.

I note the report the Provincial Auditor provided us with, which is the 1990 annual report. I've gone through it very quickly. I don't see any place in there where there is an indication of some of the concerns I have, and I hope the members of this committee would share as to what kind of budget this division of government has -- how many employees, how many assets, fax machines, photostat machines, computers and so on.

In other words, the bottom line, what are we paying to have an agency of government collect 10%, and in some cases less than 10%, of the debts that are being referred to it? I suggest if it's an extraordinary amount, perhaps the government should revisit as to whether it's worthwhile having that organization any more.

I draw your attention to the 1990 annual report. Perhaps I'll ask the auditor. It doesn't have a page number, but there's something up at the top. I think it's 25. It's under the item "Collection Procedures," on the sixth page. It says:

"As a result of concerns raised in our 1984 audit on the fund" -- it appears as though this group has a long history -- "all delinquent accounts were to be handled by the central collection service rather than private collection agencies."

Do I assume from this that prior to central collection service doing this, it was in fact handled by private collection agencies?

Mr Erik Peters: My understanding is that it was. I've not reviewed the 1984 report, but speculating, there were difficulties apparently with the collection agency and the fairness of their reporting back the actual results of their collections.

Mr Callahan: In the 1984 audit on the fund, they seem to refer to that as the reason why they went back to the central collection service. Can you tell us what percentage the private collection agencies were recovering, or do you know?

Mr Peters: I don't have that information with me. I could get that for you.

Mr Callahan: Perhaps you could find that out, because I think that's of some importance to the committee if it's going to vote on this issue.

Mr Peters: All right.

Mr Duignan: A couple of pages back, it talks about that.

Mr Callahan: Forward or backwards?

Mr Duignan: Forward.

It states, "At July 31, 1989, the unit was administering 33,000 accounts totalling $64.4 million. Of these, $15.2 million had been referred to four private collection agencies." So it was still referring moneys out to private collection agencies as late as 1989.

Mr Jackson: Mr Chairman, could I seek clarification from you? I'm comfortable with this whole line of questioning, but I'm trying to determine just what we're going to be accomplishing in this morning's session. Might I ask the Chair's indulgence and guidance in this regard.

The Chair: Sure.

Mr Jackson: As I understand it, you were recognizing Mr Callahan's motion. If that is your ruling, that you were accepting it, fine, then we're proceeding on a motion. But I sense we're getting into a round robin discussion into matters that flow from emotion. If on the other hand we're just using our time as it's allocated -- Mr Callahan is able to use his time any way he sees fit, but I'm trying to get a sense of what direction we're going here.

I thought with the deputants here with their ministry, we were going to pursue that. I respect what Mr Callahan is doing, but we are talking about another ministry. It's a very important point and I support him on it. I'm just wondering if this is the time to be doing it. If that's the Chair's rule, fine. Then I can get my materials ready to participate in this debate, motion or inquiry, whichever you rule it is. Could you just guide me in this regard, please? It would be helpful.

The Chair: I'd like to answer Mr Jackson's question because I think it's very appropriate. As members know, I was not in the chair yesterday afternoon when the notice of motion was made. This morning, I spoke to a couple of members who had some concern about the notice of motion and about the motion itself, whether it was necessary or whether we could get the information without it. There was a whole host of concerns.

This committee has not yet decided when we're going to hear Mr Callahan's motion. What I thought I would allow this morning was some free-wheeling discussion on the concept of the motion so that we would have a better idea of the merits of the motion, whether we wanted to proceed with it and when we were going to proceed with it. I was keeping an eye on the clock and I was hoping that by 10:30 this morning all members of the committee would have had the opportunity to participate in this -- I wouldn't say unusual, possibly less structured -- debate on Mr Callahan's intent.

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Mr Jackson: I wasn't nor was my caucus one of the groups you discussed this with this morning. I now am informed, so I would like to participate in this discussion in the eight minutes you've said we have remaining to discuss it.

The Chair: Okay.

Mr Callahan: Can I perhaps assist? I remember yesterday somebody made the comment that we have the ministry people here and perhaps we shouldn't be debating other things while they're here. I'm quite content, if the committee wishes and is in agreement, that this matter perhaps be set down until a little bit later in the day to be dealt with, or, if as the Chairman has said, we restrict this until 10:30 just as a preliminary step and then get into it at some later stage rather than inconvenience the people from the ministry.

The Chair: I think this discussion bears heavily on what the witnesses might want to do in their future endeavours within their own ministry, so I think it's an advantage to them to hear this discussion.

Mr Duignan: We have no problem with this motion whatsoever. The audit was done in 1990. Maybe another follow-up audit needs to be done to see exactly what's happened since to some of the concerns the auditor raised.

What I would like to see along with this particular audit -- I know we collect roughly 10% of the money outstanding, but what percentage of cases does that relates to? For example, does it relate to 100% of the cases that have been referred to the ministry or 50% of the cases? That $10 million could refer to 100% of the cases out for collecting, and we're just not collecting enough money. I don't know those answers but I would like to know those answers.

Mr Jackson: For my part, I would be more interested in following up on Mr Duignan's suggestions, but also whether the government would be amenable to inviting someone from that department tomorrow to appear briefly before us to clarify these matters.

It strikes me that we can either ask someone from the auditor's office to explain what he thinks is going on there currently, ask our researcher to go and find out or invite the civil servant in that department to come before the committee. Maybe we could get a sense from the government. I know Mr Callahan would certainly support a brief opportunity to have someone from that department forward just to clarify their procedures.

The Chair: Before we vote on the motion or before the motion's called?

Mr Jackson: Yes. You used the word "unusual" procedure. I'm just simply going with the flow here.

The Chair: "Less structured."

Mr Jackson: I got a sense from Mr Duignan, as the whip for the government side, that he was somewhat supportive of the direction.

My final comment in the interests of time: As I understand it, this committee will examine several recommendations once we conclude not our debate, as Mr Callahan referred to it, but our inquiry into the activities of this ministry. Our debate and subsequent recommendations hopefully will occur in the afternoon of Thursday of this week.

At that time, in my view, it would be appropriate to refine this recommendation of Mr Callahan's in the context of what I believe will be several recommendations flowing from this committee's activities this week. I think that's the more appropriate place, but it's helpful if we could get some feedback from the government if it supports an invitation of that nature.

The Chair: We have some time available tomorrow afternoon. Mr Hope and then Mr Duignan.

Mr Randy R. Hope (Chatham-Kent): I think Mr Duignan wants to clear his comments up, because Mr Jackson has interpreted.

Mr Duignan: I'm in support of Mr Callahan's motion, but I understand that's a new item for discussion another day by this committee. We're dealing with the FBA referral right now. I think the auditor's going to need some time to do a follow-up audit, and I don't think that information is going to be ready this week. My suggestion was that the auditor look at this and that it come back to this committee to be dealt with later on, not at this particular time.

The Chair: I'll tell you what. Why don't we think about this for the rest of the morning, and at approximately 11:50 this morning Mr Callahan can place his motion and we'll have limited debate and then take the vote.

I thank the members for their cooperation in dealing with this matter. Mr Callahan, the rotation this morning will start with yourself.

Mr Jackson: Mr Chairman, again to assist, there was a request of the ministry staff for an extensive amount of documentation. Would it be helpful to the Chair and to the committee if you inquired what of that information they came prepared with today? I have received this stuff from the researcher, for which I thank Mr McLellan, but several members laid out a half-dozen or so requests for information for today, and it would be helpful if we could get that up front.

The Chair: Thank you. I recall that yesterday during the course of business there were some requests made by individual members. Is some of that information available, Mr Pascal, or is it coming?

Dr Charles Pascal: Mr Chair, I don't want to be facetious and say it's in the mail; that's a different jurisdiction anyway. We received yesterday 15 requests for information. Some of it is on the shelf and is being collated and will be here hopefully today. Other requests will take a little time. It might be helpful to Mr Jackson and other members of the committee if I gave you early this afternoon an update with respect to what will be here imminently and what remains to be done, and a guesstimate with respect to how long that would take.

Part of the fault in terms of quick response is a function of the fact that we were here until a particular time, and I didn't arrange -- I'll take ownership for this -- for some kind of shuttle activity to get things going as they arose. I just didn't anticipate the kind of level and breadth of requests that would be forthcoming.

Mr Jackson: It's like estimates but a little more polite.

The Chair: At 2 o'clock, then, we'll get an update on where the information we've requested is at and when it will be coming forward.

We'll start off a 15-minute round. Mr Callahan.

Mr Callahan: The first thing I'd like to inquire about, and perhaps I need some clarification from you, is that on page 8 of your opening statement you say, "We identified five key priorities on which to focus in order to improve the program's capacity: (1) to link interested recipients to training and employment opportunities...." Do I gather that these are going to be employment opportunities to give them experience? The closest thing I can think of is the program in the schools they call co-op education. Is that the type of thing you're talking about?

Dr Pascal: That's one example, but I think the most prominent example is the Jobs Ontario program, which is designed to provide training and subsidies to employers to give both training and job opportunities to social assistance recipients in the private sector, and in the public sector as well. What we did through the infusion of staff was to create far more opportunities to do front door screening and review of current case loads to increase our ability to refer the recipients to the Jobs Ontario program. I think that's the most significant initiative, along with other training programs, and marketing the STEP program as well, as part of the activity. That would be the best example, and the results to date have yielded about 1,200 individuals being referred to job opportunity and training programs.

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Mr Callahan: In light of what you've said, I think that's certainly an approach and a direction one would want to move in to get these people out of the welfare rut, because if they don't, it's demeaning to them and it continues perhaps beyond their family to the next generation.

In light of this very important part of the process, were you ever consulted by the government, particularly by Employment and Immigration, about the introduction of this new WCB policy which would require that students be covered under WCB insurance premiums? There certainly seems to be an awful lot of it in the press.

An article by Richard Mackie of the Globe says, "Coverage could cost employers $8 million, critics say."

There are several other comments made: "Student Jobs on the Line." "Seventy thousand college and university students may be axed over proposed Workers' Compensation Board changes.... About 50,000 training jobs for student nurses and other trainees are in Ontario hospitals, which would have to pick up their WCB costs under the changes slated for July 1."

It would seem to me that if you haven't been consulted, you should have been, because I can see this causing a significant impact on your efforts to get these people to be able to pull themselves up by their bootstraps and get out of the social assistance scheme. If you have considered it or you have been consulted, is there anything planned by your ministry to include in its budget perhaps a pre-payment of these insurance premiums in order to ensure that the employers who might take these people on will not refuse to do so because of the enlargement of these I think short-sighted steps on the part of the WCB? I mean, they're just simply going to dry up the job scenario for people who need the training. That's a long question and it contains a lot of subquestions, but maybe you can answer me.

Dr Pascal: Your question is very straightforward. The answer to the first part of your question is no, I was not consulted.

Mr Callahan: You were not consulted.

Dr Pascal: It does raise some interesting and important policy questions as broadly as you have defined them and those who have covered the issue in the media. It is a most delicate issue in various sectors, not just my own.

With respect to some of the policy implications, this has hit us rather quickly and recently, but perhaps Ms Fraser would answer the second part of your question, which is the relationship between this particular direction and the impact on our own clients in terms of our common interest, around this table, of meaningful self-sufficiency and interdependence in terms of our clients being in the mainstream labour market and all the precursor training activities required for them.

Ms Alison Fraser: I think, Mr Callahan, you've raised the question of what the impact would be on our intent to get social assistance recipients back into the workforce. I think one can look upon that in two ways. One is that there will be some additional costs, as you've mentioned, to the employer in terms of that coverage. The second is that if a student were injured in an employment situation or in a training situation such as you're describing to us, if that person does not have coverage through workers' compensation, then it would be likely that that person might end up on social assistance.

So from our perspective there are both, in the vernacular, an upside and a downside to that kind of coverage. There are additional upfront costs, but on the other hand there is the insurance aspect that ensures that this eventuality would be funded through that system, which is a contribution-based system.

Dr Pascal: When we talk about an upside, we're being very parochial here; we're talking about the load on our particular budget. We don't mean to be disrespectful with respect to the load on others' budgets, whether they be employers or social agencies or colleges.

Mr Callahan: It's my understanding that in those avenues in the past where there have been opportunities for people to go and get some training on a non-pay basis or a subsidized basis, the question of their possibly having an accident, as was raised, is covered by -- I may have misread this, but I think it's covered by insurance that the person who sends them there has provided outside of WCB; I may be wrong, and I'm sure if I am I'll be called to task about it.

This policy is really frightening because of things like: "...200 nursing students would add $180,000 a year to the hospital's operating costs at a time when the freeze is on." I'm not going to comment on the freeze; obviously everything's tight.

"The Volunteer Centre of Metro Toronto warns that the policy can endanger the positions of up to 30,000 volunteers, including candy stripers and people who work for the children's aid society."

If Mr Mackie is right in his article, that's scary, because what that does is to really strip us of people who, in the past -- volunteers particularly; the minute you start getting on their backs, you lose the volunteers. If we think we've got a deficit now, we'll be in worse shape. Volunteers are the backbone of this province and this country.

I would certainly hope you will be communicating with Mr Di Santo of the Worker's Compensation Board. He may feel that this is an opportunity to secure some more money. I don't know why: perhaps to do some building, who knows? But it's certainly very counterproductive, and I don't think it's going to be beneficial to young people, to volunteers or to anybody else. So he should take another look at it.

The article even says, "Between 50,000 and 70,000 people in training programs could be affected." This is according to the Association of Colleges of Applied Arts and Technology of Ontario and the Council of Ontario Universities. I think that's a message that can't be emphasized more to the public, that they should get out there and try to find out why this policy has been taken upon itself and what they can do about stopping it, because it seems to me that it's a totally looney tunes thing, and unless there's some very legitimate reason for it, I think they're going to impact on people trying to get back on their feet.

I'll move on to another issue. How much more time do I have?

The Acting Chair (Mr Noel Duignan): You've got six minutes.

Mr Callahan: I'm concerned about the issue under maintenance and child support. The ministry pays approximately $1.3 billion annually to over 140,000 sole-support parents. I have no problem with that. They're in need, and that was one of my concerns about the bad debt collection, that we'd have a lot of money to look after those people who legitimately need it.

However, it does concern me that in over 70% of the cases -- let's see, the auditor says: "We reviewed these procedures in over 100 sole-support parent files. We found that in over 70% of the cases, either no support was received, or only nominal amounts were received. In many cases, evidence suggested the recipients had not made reasonable efforts to obtain support from the other parent. The ministry did not reduce the monthly allowances in any of these cases, although it has the authority to do so under the family benefits legislation."

That was one of the reasons I asked you yesterday. I would certainly expect that if we do a follow-up audit a year from now we would see this in place: With the technology of computers that's been around for a long time, surely we have the ability to be able to marry the computer system of the Attorney General, with his SCOE legislation, and marry your ministry with a whole host of other operations. It's mind-boggling that governments can adequately track people who are renewing their licence plates, adequately track those who fail to pay a parking fine, a speeding fine or a Highway Traffic Act infraction, put so much effort into doing that, with the rather serious result that if you don't pay it you find yourself driving without a licence and you don't know it and can wind up in jail for that.

Yet here, one of the most sensitive and one of the most important issues that I think a caring society should be terribly concerned about is your ministry, is the looking after those people who for whatever reason -- a downturn in the economy, a death in the family or loss of a job -- need assistance. It just boggles my mind that this would not have been the first avenue that would have been tied in with an on-line computer system to ensure that SCOE works.

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I certainly hope you have more success than the Attorney General has had with SCOE. I think every member around this table would agree that SCOE is one of the most constant referrals and questions asked of us by constituents. It probably causes the most consternation in terms of trying to recover moneys for people, even with the garnishee proceedings. That has not enhanced it.

In some areas, it has in fact worked an injustice. I had one constituent who wrote my office. His income tax return had been garnisheed. He and his wife had gotten back together again and agreed that there was no necessity for support payments. They were trying to get this money out from underneath this cloud and were having an unbelievably hard time in doing it.

Mr Jackson: Maybe that's what brought them together, a project they could work on together, Mr Callahan.

Mr Callahan: It could be. But in any event they very desperately needed this money for themselves, their own welfare and their children's welfare and couldn't get it. It's still being flogged around.

In any event, I've had my --

The Acting Chair: One minute.

Mr Callahan: Have I got one minute? Well, what can you do in a minute?

Mr Jackson: Finish the story. Is there a happy ending?

Mr Callahan: There's no happy ending yet, but perhaps if you tune in in March, we may have a happy ending. I would hope so.

But all in all, I would be recommending as a member of this committee, I don't know whether my colleagues will -- and I hope you won't take this the wrong way -- that we would review your ministry again next year in order to determine whether these technological advances you've promised have taken place, and I'm sure you promised them in good faith, that the whole system would work better, because we can't afford to lose that kind of money, I think you'll agree with me.

Dr Pascal: Just in responding the last point first, we have found the process of dealing with the Provincial Auditor uniformly positive and constructive. I don't wish to assist Mr Peters, our new Provincial Auditor, in his work plan and priorities, but if he and others see fit, that would be fine. We'd be delighted to be part of the annual work plan to follow up on perhaps some of the more precise matters arising out of this past review.

With respect to the issue of family support and SCOE, again, as the Provincial Auditor has noted, we have been vulnerable as a result of the overburdened system and a problem with staffing. I think you're quite right with respect to an insistence on a better track record. You're also quite right with respect to the need for data matching. As a result of a question posed yesterday along the same lines, we will present to you some time today, tomorrow or shortly thereafter a letter that was requested. I think someone requested a jointly signed letter from both ministries attesting to the fact that what we said yesterday about the data matching is in fact happening. We'll be pleased to close that loop.

The results since April are very promising. With the addition of the parental support workers, the number of cases assigned is about 5,000. I think as part of the discussion, though, it's extremely important to remember about the nature of the target groups. With all vigour and comprehensiveness, we should pursue each and every case, but we need to know that it's important not to overestimate the yield that will come from it because of the number of claims that are made against people who themselves are unemployed. I met again a couple days ago with parental support workers who are telling me their work is profitable in terms of the concerns you have, but it also has a percentage yield which we have to keep in perspective.

I very much appreciate your concerns. We think we're making some movement in that direction.

Mr Andre Iannuzziello: Mr Callahan, you may be interested in knowing that in April, just before we hired staff, the revenues we had on assigned cases with the SCOE program was approximately $1.9 million. After new staff have come on board, we have not only an increase of 5,000 people who now have assigned cases with SCOE, but the revenues are up to $2.3 million per month. So for sure, this is an area where we can generate a tremendous cost saving and we need to link up with SCOE to enhance the savings.

The Acting Chair: Mr Jackson, you have 15 minutes.

Mr Jackson: Perhaps I could begin with a question of clarification to the auditor. As I understand it, your activities were confined to the FBA, partially because they were set out in that fashion but also because the general welfare assistance is administered partially by municipalities and therefore you don't necessarily have the authority to go in and examine that activity, or would you have the authority to go in and examine those agencies?

Mr Dinkar P. Amrite: Actually, we have audited the GWA separately. It was also the subject of comments in an annual report back in, I believe, 1988-89.

Mr Jackson: Okay. We're dealing with approximately 40% of the total social service budget is FBA, just for rough estimates.

Mr Amrite: It's one third, I understand.

Mr Jackson: It's one third. It's lower. Okay.

My questions then: Yesterday I asked about the integrated offices and perhaps, Dr Pascal, you were able to check the list of how many. I know there's not many, but do you have that list for us and can you recite for the committee how many communities that is?

Dr Pascal: I believe the integrated site experiment is located in eight communities. Perhaps Ms Fraser would add a little detail with respect to where. I'm sure you have some follow-up questions which we will be able to answer.

Mr Jackson: I'd just like to establish the locations of the eight integrated programs.

Ms Fraser: I apologize to the committee. We had understood that the response to this question had been asked for in writing, and there's actually someone preparing a document as we speak.

Mr Jackson: That's fair ball, but we're going to run out of time. I have to get on with these questions and I do have questions. I don't have a debate at this moment. I'd prefer to do questions.

Ms Fraser: With respect to the location of the sites, I'm going to call upon my long memory next door. We know we have -- Peel is one of them, Windsor is one, Thunder Bay, Lanark, Peterborough, Durham is one and there's one other --

Mr Jackson: Waterloo, yes.

Ms Fraser: Thank you.

Mr Jackson: I missed one: Waterloo, Durham, Windsor, Thunder Bay -- oh, Peel, okay. Thank you.

Could I ask the deputy -- twice you've referred to your visitations -- have you visited any one of the integrated programs?

Dr Pascal: No, I haven't as yet.

Mr Jackson: Is there a reason why you haven't?

Dr Pascal: I have under my responsibility in terms of transfer payment agencies and responsibilities 7,200 transfer payment agencies.

Mr Jackson: Fair ball. You've been very busy. Has any one of the four members present been able to visit one of these offices for an examination or a review?

Mr John Stapleton: Certainly over the last 10 years since those integrated sites have been in place, I think I've visited all of them.

Mr Jackson: What is the nature of your review, and whom do you report to on the statistics found in those centres?

Mr Stapleton: I actually did not participate in any particular review. I thought your question was more of visitation. The actual responsibility is undertaken in each area by the program supervisor for income maintenance in each of those localities that correspond to our area officers. They have program review officers we otherwise refer to as PROs who are responsible for doing all the claims examination activities and statistical gathering and that sort of activity, to ensure that the administration cost and the filling out the form 5 data forecasts --

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Mr Jackson: Yes. Is there any comparative analysis between offices to determine that a greater rate of recovery is occurring in a given office or that a greater rate of file verification is occurring? Is there any analysis done within your ministry on these two points?

Dr Pascal: Mr Jackson, can I just ask a clarifying point? When you talk about the variations between offices, are you talking about integrated sites and other sites or are you talking about within the eight sites is there variation?

Mr Jackson: Between the non-integrated sites and the integrated sites. It strikes me that you have a unique opportunity here, and I'll get into that in a moment. First of all, I want to understand clearly the level of monitoring which is currently occurring by your senior staff. There's no sense pursuing a series of questions if we're not monitoring nor are we doing comparative analysis of whether or not they have a more successful rate.

We have heard in camera from the auditors their position on this, and they're very clear in their understanding. I'm just again trying to establish the degree to which someone in your ministry is examining why certain offices have better success rates than others.

Dr Pascal: I can't answer Mr Jackson's question with any detail, because I haven't either anecdotally or myself in any rigorous way done that analysis.

Mr Jackson: You're the deputy. I wouldn't expect you to have that.

Dr Pascal: I understand that, but I --

Mr Jackson: I'd like to know who is assigned to this department and who's the number cruncher, who's the bean counter -- forgive that offensive expression, but there is literally someone who is responsible for the moneys spent, as opposed to Ms Fraser, who is responsible for policy and implementing policy adjustments and accountability of certain staff. There's certainly someone there who's analysing numbers and reporting to you as a line responsibility. I would not, and I don't wish to, especially since we're on TV, assume that you personally have been involved in all this.

Dr Pascal: No, I was just --

Mr Jackson: That's why you have senior bureaucrats. I want to know which of these people before us today has this responsibility. Then I can continue my questioning.

Dr Pascal: With respect to assignment of responsibility, the person who is in charge of the development of the system from a policy perspective, and I infer from your question it's designed to inform quality assurance and development of the program in terms of decisions around things like delivery, both future options and ones that have been experimented with, would be Shirley Hoy, who's the assistant deputy minister of policy and program development.

My impression, and this is only an impression, is that one part of the answer in terms of the comparison that needs to happen is that because the case load ratios are lower in the integrated sites, by contract, some of the interventions we've described with respect to the program generally, which have been successful in recent months, would have relatively better outcomes in those integrated sites. They're not dealing with all clients, sole-support parents being the focus. That would be an impression and expectation, but --

Mr Jackson: You've used the words "impression" and "suspect." Our limited investigation has brought us to the conclusion that we are getting better results in integrated offices from several points of view, and it would strike me that if you are reading the auditor's report and responding to it, your solutions lie in certain areas.

I haven't looked at the cities which you identified for increased staffing. Are any of the integrated sites involved? We've not bumped the staffing in the integrated sites, so there must have been a conscious decision that those were the cities that required the assistance --

Dr Pascal: The cornerstone of our strategy with respect to the infusion of 200 and eventually 450 staff was designed to deal with the FBA case load in the areas where the client traffic has been exponential and the highest and that's where the staff have been located, not in the integrated site area, where the ratios are --

Mr Jackson: Fair ball, Dr Pascal, but the thesis we're getting is that in an integrated setting, you are having disproportionately more referrals to CPP because the intake is done at the municipal level with the various supports in the integrated environment, that the levels of reported cases of fraud are marginally better.

Perhaps at the root of this is a municipality's ability to hire additional staff. Most of us come from communities where our municipalities have acquired additional staff without subsidy from the provincial government and simply said, "Look, we have a 20% investment in our payment and we're going to protect that, and therefore we're going to hire the additional staff in the integrated setting."

I'll come to my most important area of examination for my purposes, which is why integrated offices have a better investigative rate, and I'd like to move into that, but do you wish to comment here?

Dr Pascal: Yes, if I can just make two comments and suggest another theory, because I think Mr Jackson's line of questioning is very important. First of all, I would predict that when the ultimate study is done -- of course one of the reasons for deciding yes or no to doing the kind of in-depth comparison is that the issue of delivery has been an on again, off again question for political reasons for a number of years, and the disentanglement --

Mr Jackson: I'm sorry, Dr Pascal. You're talking about a definitive study. I'm simply saying to you --

Interjection.

Mr Jackson: No, I'm sorry; it is very important that we understand each other in order for you to be helpful to the committee. I'm not talking about a major study. I am simply saying that a woman with children who's been abandoned in the city of Waterloo is not different from a woman who has been abandoned in the city of Toronto. My point to you, sir, is simply that we don't have a disproportionate number of abandoned women in one community over another, but we do have them appropriately placed within -- some of the concerns that were expressed in the audit review are being treated marginally differently. All you have to do is compare your intake numbers and your outcomes. That's not a major task, Dr Pascal.

Dr Pascal: No, and I was --

Mr Jackson: And you are not able to share that with us at this point.

Dr Pascal: Mr Jackson, I was going to go on to --

Mr Jackson: Don't talk about some big, huge study here, Dr Pascal.

Dr Pascal: Mr Chair, I was going to go on to say two things. One is of the specific nature that I think Mr Jackson wishes to explore, and I think it's very important, and that is that the most significant difference between the FBA offices, the standalones, and the integrated sites is staff ratio. It's precisely the reason why the infusion of new staff is required to yield the integrity that you say, in a comparative sense, the integrated sites are yielding.

We can talk a lot about the municipal involvement, the provincial involvement. You're quite right about the nature of the client, and the most significant variable that's in common in terms of showing differences which the Provincial Auditor has well reinforced is the client-staff ratio. I think you're absolutely right and we don't need, as you say, a grand, well-designed study to show that.

I would like to suggest that Shirley Hoy, the person who's held accountable for this area and who's with us, comment on the integrated sites and then she can be up here to help with Mr Jackson's line of questioning on this.

Mr Jackson: That would be helpful. Before I proceed with that and because of the limited time, I want to put on the table the second area of concern. I think staffing ratio is significant, but I want to get into this whole issue of investigations, the investigative authority.

Yesterday, I asked you if you could respond to any changes in investigative procedures that have been recommended internally, if you could share that. Just for purposes of the committee's understanding, when I'm talking about investigating procedures, there are impediments to a civil servant pursuing a case of welfare fraud. There have been several jurisdictions, several provinces, which have been affected by the cap on CAP and they have reacted by strengthening the tools of the civil service in order to catch welfare fraud.

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It is very clear, in the conversations I've had with at least one integrated office, that it has more tools to catch welfare fraud than provincially run offices for the simple reason that it is an arm of the municipal government, and therefore information is shared within a municipal government setting. There are a whole series of questions which a provincial employee cannot ask of a municipality, but which a municipal employee investigating fraud in a municipal setting can ask, and that, in my view, is why the rate of collections is higher and why the integrity of the systems in our integrated office is marginally better.

I put that as a thesis, and I will explore it, but I have asked you for information on, has your staff recommended to you any changes in investigative powers? I've seen the Quebec legislation. It's rather extensive. I would hope that the committee has time to look into this because it essentially gives the civil servants the tools to go out and collect welfare fraud, to go and pursue it. We don't have the tools in Ontario that they have in Quebec.

Dr Pascal: Elected officials will have to decide whether the province of Ontario should have all the tools this particular jurisdiction uses. But let me ask Ms Hoy to explore both areas, the integrated sites in relation to, for example, the issue of investigation and impediments.

The Chair: Okay, we have Mr Hope, Mr Hayes and Mr Fletcher.

Mr Hope: I thought they were going to answer, because I'm particularly interested in listening to the answer that Mr Jackson was looking for. I think Dr Pascal just indicated that Ms Hoy was going to answer Mr Jackson's comments or question, whatever it was.

The Chair: Is that what you indicated, Mr Pascal?

Dr Pascal: Yes.

The Chair: I'm sorry. I thought you were going to answer it later on. My apologies.

Dr Pascal: We wish to explore what I think is a very important area.

The Chair: It's hard to know what the members want because sometimes when they look up to the Chair they're pointing at the clock.

Mr Hope: Sometimes members don't put the direct questions and we take a long time to make speeches, which makes it very hard for the people to make answers.

The Chair: Sometimes members are pointing at the clock and we start the rotation, and then when you start the rotation they want to hear the answers, which affects the time clock, so we'll just do the best we can. Ms Hoy, could you please answer the questions.

Ms Shirley Hoy: In terms of the question from Mr Jackson, first of all, dealing with the whole area of investigation, when we read the article in the paper on some of the changes that the Quebec government was contemplating, certainly staff followed up on that. We did some follow-up discussions with officials in Quebec. As you saw in the news article, I don't think it's an easy area we can get into, and certainly the commissioner for privacy in Quebec cautioned the minister when he indicated that he wanted to go in this direction. Similarly at the municipal level, the municipalities -- and I know with my experience at Metro -- are also governed by the municipal freedom of information legislation.

In the whole area of looking at how we can broaden the scope of both provincial and municipal officials in investigation, we are looking at it, but we have not come up with any particular strategies to broaden that. It is an area of interest, I think, right across this country because every provincial government is facing the same kind of fiscal pressure. That's the extent of our investigation so far.

In terms of your earlier questions to us about what we have done with the integrated sites, we have not done official reviews, but certainly we have looked at the implication of having a lower case load and the impact on services to the clients and the extent to which we can look at how it affects the FBA case load management. As you know, the way we operate in the integrated sites is that it's a specific contract that we have with the municipalities in operating the integrated sites. They are still considered as a pilot. We've been looking at the results from this experiment. As we move in the direction of trying to help our clients to move back to educational training and employment opportunities, a clear area of success is the time the worker can spend with the clients to help them determine what their past education and employment experiences have been and where they can move to in the future.

On your question, Mr Jackson, on why did we not identify any of the integrated sites when we put the additional staff in and tried to deal with the case load situation, the eight sites we identified were the ones that had the highest increase in FBA case loads. The reason we did that was that was pinpointed as the major area of concern by this report from the auditor and by previous reports as well. Our biggest problem has not been with the general welfare case load; it has been with the FBA case load. This is the reason why none of the integrated sites were covered by the additional staff that we have.

Mr Jackson: I will pick it up in my next rotation. Thank you. That's helpful.

Mr Hope: To Dr Pascal and others who are at the table there, I'm going to go back to yesterday because yesterday there were a lot of questions asked and not a lot of time for you to respond. I need clarification in order for us to deal with this by Thursday, and I'm not particularly interested in reading a whole lot of documentation and presentations that are there.

What I'm going to focus on is that we heard a lot of concern yesterday about fraud in the social service system. Do you agree that we should clarify the difference between deliberately defrauding the system and recipients who make errors? Do you agree that there are two separate types? In the auditor's report, he indicates preventing fraud and detecting fraud. Do you not agree there are two separate identities there, one deliberate and one of just basically human error?

Dr Pascal: Absolutely. There's clearly a demarcation between malicious and mischievous intent to defraud and administrative error and issues of commission and omission around those cases, which I think are qualitatively different from intent to defraud. In either case, I think the line of questioning yesterday was appropriate on both sides, and that is that we need to be rigorous and comprehensive about pursuit of different types of breaches of integrity to the system in order to ensure efficiency of outcome in terms of expenditures. But I certainly agree with the premise of your question.

Mr Hope: Then it leads to my next question, because we've identified and you've agreed with the auditor's report that there is fraud that occurs, whether it's intentional or unintentional. We're looking at preventive ways, because the report indicates that a previous government had the power to make corrections and didn't make corrections. Yesterday, in some of the comments you made you indicated that there has been an increase in the amount of moneys recovered in overpayments. Dr Pascal, you mentioned briefly yesterday something like $100,000 a month that is being recovered, and I'm wondering if you might elaborate a bit more on that area.

Dr Pascal: To summarize very briefly -- I certainly don't want to repeat my opening remarks -- in the area of overpayment recovery from non-recipients, we expect an annual return as a result of the intervention of about $8 million. As you mentioned in your question, Mr Hope, we're averaging about 100 or so cases a month being terminated as a result of fraud identification and action, and the yield is, as you pointed out, over $100,000 in savings. A few moments ago, Mr Iannuzziello made reference to the progress with sole-support parent assignments. What have I missed? I turn to my colleagues.

We're quite pleased with the progress. Again, the Provincial Auditor certainly noted a vulnerability which was accurate. The discussion yesterday was extremely useful around the need to be very rigorous about following up, for example, on fraud. We have never had a policy not to follow up on fraud; we were vulnerable with respect to our administrative action around that. I'm not here to pretend it has been otherwise, but I am beginning to be quite pleased with the progress and quite optimistic about our ability to act and to recover overpayments or to act on cases of fraud.

Mr Iannuzziello: What's really interesting is that when you look at the figures over the past six months, they reflect how aggressive we've become in pursuing fraud complaints or allegations. Between April and September, we terminated approximately 650 cases. In the months of November and October, we terminated almost double the amount that we did over that six-month period; in two months, we terminated over 300 cases.

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Mr Hope: My final question is dealing with Mr Callahan's questioning around who should collect the money in the ministry. I'm glad this report was tabled to us today from the Provincial Auditor, because it talks about the fact that it used to be in the hands of a private collection agency. I'm not sure, but I'm assuming it was the Conservative government at the time, and then the Liberals, who had an opportunity to return it back to the private or whatever, didn't do it.

Mr Jackson: Just how much high school history did you get, Mr Hope? Can't you read the year on that?

Mr Hope: Yesterday, Mr Callahan suggested that the ministry approach a private collection agency to collect the overpayments. Has the ministry ever considered this? Can private agencies offer a better collection rate for the taxpayers of the province?

Dr Pascal: The short answer is, on a personal level, I don't know. I know the line of questioning of Mr Callahan was something with which I was very comfortable, because we're talking about a common objective we all share, and you're reinforcing it as well: that we ensure we are rigorous and vigorous about the manner in which we try to recover payments.

Because I was quite curious about whether or not we had ever considered private collection agencies, I went back and found enough staff around to begin doing our work on responding to the information requests. I did ask someone in the ministry whether we had ever considered a private collection agency. I was told that about 10 years ago in fact it was suggested. I was also told that when we approached several, we were told they would probably give us three cents to five cents on the dollar.

Mr Jackson: You'd be breaking even at that rate.

Dr Pascal: Government services, we're told, is --

Mr Jackson: They're at 10%.

The Chair: Order. Mr Hope has the floor.

Dr Pascal: I'm told there was some experience with at least investigating. I don't know how thorough it was. It might have been just quite casual and informal. In the case load we're talking about, both current and former, with many of them unemployed and with the migration in and out of provinces, it gives actuarial statistics to various people who are in the business of making money a question of whether it would be worth it in terms of yield. We have a lot of former clients who are disabled and move on to another security system, old age pension etc.

The other thing I did this morning, as the rumours I've just referred to are about 10 years old, was to ask someone to phone a private collection agency and just see, hypothetically, if we ever ask, because I thought it was a really important challenge being posed. What I was told by the staffer who made that inquiry was that the response hasn't changed. They said, "Maybe you'd get five cents on the dollar." He also said that on student loans recovery, the highest he's heard of anybody getting on that return is 30%, 35%. Maybe our client group is somewhat different, although I don't think we should exaggerate that.

Mr Jackson: Could you furnish us with the name of that agency, Mr Chair? Just a request for information.

The Chair: Order. We've got to stick to the rotation. Mr Hope, have you finished your line of questioning?

Mr Hope: Yes.

The Chair: Mr Hayes.

Mr Hope: Is the answer completed, though? Why I brought it up is that Mr Jackson starts asking questions while the deputants are responding to me, and then he comes in and starts throwing gestures out. I'm just wondering, are they done with the answer to my question?

Dr Pascal: Mr Jackson noticed that I took out --

The Chair: Dr Pascal, could you please answer only Mr Hope's questions and ignore all interjections?

Dr Pascal: I'm finished.

Mr Pat Hayes (Essex-Kent): Do what I do. I ignore Cam.

Mr Mike Farnan (Cambridge): That's very good advice: Ignore Mr Jackson.

The Chair: Ignore all interjections. Just answer the questions posed by the members of the committee who have the floor at the time. Mr Hayes, then Mr Fletcher.

Mr Hayes: Dr Pascal, yesterday I was asking for an update on the opportunity planning project. Of course, Mr Jackson did interject and raise the issue of STEP. The question I'm going to ask, and then I'm going to tell you why I'm asking it, is why did the ministry make changes to the programs? The reason I ask is that a lot of stories are going around this province. The leader of the third party, for example, about a year ago, was down in Chatham, in Mr Hope's riding, and made a comment to a group of people that we have people out there making something like $17 or $17.50 an hour and are on welfare. I'm just wondering if you could address that, because I've had letters and phone calls: "Is this correct that we have people who are making this kind of money and being on welfare?" I'd like a clarification, and ask you why you have made changes to that particular program.

Dr Pascal: First of all, the criticism of the changes has included of course the fact that this may be perceived as a backtrack with respect to the importance of STEP, the supports to employment program, and that certainly wasn't the minister and the government's intent. The reasons were twofold, and I'll ask Mr Stapleton to provide some detail.

There were middle-income and, in some cases, well-documented cases, middle-to-higher-income individuals coming on to the program, and that's something we wanted to conclude. Also, it is a way, amid the many difficult, for us, choices of dealing with the fiscal challenge of the program: There's a cost avoidance of $60 million. We try to do it in a way that is not a policy breach in terms of the importance of STEP. As a matter of fact, we have beefed up our marketing of STEP to clients to ensure that people understand they will be better off working than not working.

Mr Stapleton would probably want to add a few details.

Mr Stapleton: When we first started STEP, we provided it to both applicants and recipients of the program. We discovered, about a year into the program -- we were monitoring the statistics very closely -- that in fact more people who had earned income and who were working either full-time or part-time were backing into the program, even though one might say that from the earned income they were receiving they would be able to meet their basic needs through that income. If my recall is correct, approximately 55% of the total number of people who were in STEP, and that numbered some 90,000 people on general welfare assistance and family benefits, were in fact coming to the program with earned income in the first place.

The principal reason for putting STEP in in the first instance is for persons who are making either no income or very low income to actually be able to earn their way off the program or earn their way to a situation where they would be less dependent on social assistance. When we found that was not the case, the changes were made in order to allow only those people who were in the situation of having very low or no earnings to be able to get their foot on the ladder, so to speak, and move their way into paid employment.

The program is much more streamlined in terms of the original intent to help people get off. Over the last three years, those various elements of STEP, whether it be the first months of child care or the deduction for child care, have actually been increased, thus allowing principally sole-support parents, disabled persons and employable persons, to be ensured that for every dollar they've earned they are going to be better off for having earned that dollar.

There's no question that STEP is a complex set of rules, but that complex set of rules interacts with other systems in such a way that people will be better off for each dollar earned. The corollary to it, though, is that people who are earning full-time wages in the private or public sectors would not be permitted to come on to the program, because two of the rules are no longer permitted on an application and are only available to people after the three-month point.

The Chair: I'm sorry, but did I hear an answer to the $17.50 question or did I not hear it?

Mr Hayes: In a roundabout way.

Mr Jackson: Was it a GWA question or an FBA question?

The Chair: No, it's Mr Hayes's question. I want to make sure Mr Hayes got the answer he was looking for.

Mr Hayes: I'm not really sure either.

The Chair: Mr Hayes asked a specific question, from what I understand, about $17.50, and allegations and comments that were made. Was that question answered?

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Dr Pascal: The intent to answer the question was there. My first remark had to deal with middle-income people. I didn't say "middle-income people, such as people earning $17.50," but I assumed that members would infer from that that I did respond directly.

The Chair: Did you get the answer you wanted?

Mr Hayes: If I may clarify, Mr Chair, I think that by people making these kinds of statements, there is the possibility that the public takes it that we have people making $17.50 an hour and working 40 hours a week, which is the impression you would get from this, and drawing welfare at the same time. I guess what I want to ask is, is this so or isn't it?

Mr Jackson: Can it occur in Ontario?

The Chair: Order, please.

Mr Hayes: This statement was made about Ontario, people being on welfare.

Mr Stapleton: The short answer is that prior to August, it would be possible for a single parent who had children in child care, or for a couple who had a number of small children in child care, for either parent to be making $17.50 an hour and still be eligible for social assistance. It's far less likely after August. It's still mathematically possible, if someone has a large number of small children and has a large difference between his gross and net earnings, that this could occur, but it's far less likely and might be only a hypothetical situation.

Mr Hayes: Thank you.

Mr Hope: Have we got more time?

The Chair: I was going to allow two more minutes. Mr O'Connor was on the list.

Mr Larry O'Connor (Durham-York): I would like to ask a question, but I don't think two minutes is going to allow me the opportunity to get as full an answer as I'd like.

The Chair: We'll put you first on the list in the next round.

Mr O'Connor: And I'll save that two minutes to add it on.

The Chair: We have time for a 10-minute round, because we have to deal with Mr Callahan's motion. We can't forget that.

Mr Callahan: Thank you, Mr Chair. I'd like to ask you a question. Maybe you've given consideration to it and maybe you haven't. You have hired 250 new people. Have they been hired on a permanent basis or on a contract basis?

Dr Pascal: Of the first 200, some have been hired on contract and some have been hired as classified staff. Mr Iannuzziello can give us the breakdown specifically.

Mr Callahan: Can you tell me how many are contract and how many are permanent positions?

Mr Iannuzziello: The competitions are presently being finalized. We started off last June hiring 200 people on contract. Shortly before Christmas, we started competitions --

Dr Pascal: Mr Chair, if I can interject, as I recall, of the 450 that we will hire in its entirety, 150 will be contract.

Mr Callahan: So 150 contract, and the others are permanent staff?

Dr Pascal: Correct.

Mr Callahan: And they're unionized?

Dr Pascal: Yes.

Mr Callahan: And they are hired through human resources in the normal way?

Dr Pascal: Yes. Also, as part of our commitment to employability, we have in other parts of our ministry downsizing and deinstitutionalization efforts going on with our schedule 1 facilities. We've made a special effort to have some retraining and internal opportunities for redeployed staff.

Mr Callahan: That's my reason for asking the question. Obviously, one would hope that this recession, which has increased your demands tremendously, is not going to last for ever. We criticize you, and I guess the auditor determines that part of the criticism is because of lack of staff, and that's how you got the additional allocation of 450 employees. We don't want to find you employee-rich either, so that you're falling all over one another. That would be a delightful approach, I would think, but it's not good economic sense. So 150 of them are contract. What type of contract would that be: a year, two years, three years?

Mr Iannuzziello: The staff that have been hired over the past six months have had approximately six-month contracts. In the final analysis, when all staff are fully on board, the 150 staff that will have to remain as contract will probably be hired on a six-months-to-a-year basis on contract.

Mr Callahan: Seeing as how the overall or optimum desire would be to get these people off the welfare rolls and back to work, has any type of consideration been given or any type of leg-up been given to people who are on social assistance to become part of those additional employees?

Mr Iannuzziello: Absolutely. The recruitment outreach social assistance clients are certainly applying and being considered for the positions.

Mr Callahan: It would seem to me they'd be the people who know the system best and could probably know the questions to ask and be trained a lot faster than people just coming in out of the blue.

Mr Iannuzziello: There are a number of skills that could be offered, absolutely. That's why the recruitment outreach includes social assistance clients.

Dr Pascal: That's part of the mix in our balance. Mr Callahan's absolutely right and this came up at treasury board when we asked for the $18-million investment: lots of concern for adding civil servants when there's a downsizing and redeployment spirit and action expected of each line ministry. Redeployment of existing staff, the clients themselves and a very strong commitment to employment equity targets as well have been basically guiding the hiring of the first 200 and will guide the hiring of the last 250.

Mr Callahan: I notice that the government's looking at a policy of taking over 100% of the funding and I presume 100% of the responsibility of administering the entire social assistance program. I'm a believer that it's going the wrong way. I think transferring it all to the province and having it pay the 100%, which I understand is how it's going to go, is really taking it away from the level where the people know the people in their community, can be more sensitive to their needs and perhaps are more attuned to unusual circumstances or knowledge they might have, if it's a small community, of possible schemes that may be inappropriate obtaining of funds and a whole host of things. But I guess that decision will be made by the government.

However, I would like to ask you, is there any type of liaison or joining of efforts between your information, your workers and those at the municipal level? I recognize that at the municipal level I guess they're dealing with just the welfare portion, but is there any type of use of those people on a secondment, a contract basis or whatever?

Dr Pascal: With respect to the first part of your question, which has to do with the disentanglement issue of financial responsibility and delivery because it relates to your second question, the reason why both sides of the disentanglement table, AMO and the provincial government, believe that the province should be the payer is simply because it's an open-ended entitlement program that is not best funded by the local property tax base. It's just a principle of tax and different kinds of programs.

With respect to who delivers, the principle of the payer being the quality assurer has been agreed to at the table. But who should deliver under the authority of the payer and what kinds of contractual agreements has not been decided and is up for further discussion after they've agreed to phase 1, which is just the issue of 100% for tradeoffs in the other direction.

With respect to liaison with our municipal partners, we have a committee that is known as OMSSA, the Ontario Municipal Social Services Association, with which we meet on a very regular basis. I meet directly with the president and the senior staff. We talk about all of our shared activity, including income maintenance, and we talk about shared challenges, including the issues of technology, information exchange and of course some of the more sensitive issues around payment and delivery issues.

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Mr Callahan: Is there still --

The Chair: Thank you. Mr Jackson.

Mr Callahan: Oh, sorry. That was a fast 10 minutes.

The Chair: Yes, it was a fast 10 minutes.

Mr Jackson: I wonder if Ms Hoy could rejoin us. I did have a few more questions to pursue.

Dr Pascal: I'm sure she would be pleased to.

Mr Jackson: Ms Hoy, as I understand it, when the Quebec government first contacted the Ontario government it was because of the practice which was uncovered of people living in Quebec and obtaining welfare in Ontario and that the Quebec government, rightly so, was saying: "Well, you're not going to collect twice. If you want to collect in Ontario and still live in Quebec, fine, but we're not going to pay you the additional money."

Are you doing any cross-monitoring or are you working at all with claimants who are claiming in other jurisdictions and claiming here? That's not come up in any of our discussions, but I'm familiar with my conversations with Quebec officials. It seems to be one-way. Could you enlighten us a bit about --

Ms Hoy: In particular, in the last year or so, because of the situation in Quebec, we've had a number of discussions, not just between us and Quebec but also with our municipal partners in Ottawa-Carleton because, as you know, a number of these cases come through the general welfare system and, as Ms Fraser said to you yesterday, one of our initiatives is to develop these sort of bilateral agreements between provinces on information sharing.

In developing these agreements, we have been very cautious and our legal counsel certainly have been very cautious on how to develop them in such a way that we meet the requirements of all of the freedom of information legislation. In the existing situation right now, those agreements have not yet been signed. We're almost at the stage now of working one through with our federal people with the UI situation.

We are currently discussing how we could do a bilateral agreement between Quebec and Ontario to deal with the situation, but we also have to involve our municipal partners in this because, as long as they continue to operate and administer the general welfare program, they would also need to be party to any kind of information agreement.

Currently, there is a great deal of monitoring happening in the systems. The Ottawa-Carleton general welfare office relates to the provincial FBA office that we have in Ottawa and we are watching very carefully the cases and ensure, wherever possible, there isn't that kind of duplicate payment to the clients in Quebec and Ontario.

Mr Jackson: You also raised the other issue -- and I'm straying slightly but I will raise it because I think it's germane -- of the practice when an unemployed worker applies for UIC and in the interim requires short-term welfare. It's my understanding, and I've seen the documentation that, for example, the city of Hamilton wrote the then minister, Ms Akande, asking for assistance in developing a protocol with the federal government for recovery. This went unanswered. When there was a change in the ministers under Ms Boyd, at least they got a phone call. They said they weren't interested, but they got a phone call.

Hamilton now has in place this protocol and will save some $10 million, $2 million of Hamilton residents' money and $8 million of the province's money, as a result of this procedure. I know the auditor's very interested, as is this committee, in what efforts your department is making in implementing this protocol across, because this is part of the 10% potential recoverables we've been advised are available to you to recover. On a $6.3-billion program we're looking at 600 million-and-some-odd dollars of potential recoverables in any given year in this province, and here is a clear example where the federal government's willing to cooperate. It's doing it with Hamilton-Wentworth region and it did it without any support from the province, so you're benefiting. It strikes me that we should be doing this all across the province. Could you share that information with this committee?

Mr Stapleton: Yes, the UI assignment is being implemented province-wide. It's already begun. It's begun in other important ways too. As to the time period where UI and general welfare assistance, which is mostly the case in this instance, are being paid, UI has been much more timely in its response over the last few months, which minimizes the period of potential double payment in the first instance. To answer your question directly, it is being implemented province-wide.

Mr Jackson: When will it be implemented? The savings in Metro Toronto alone are in the order of $50 million. We could take all of our children's aid societies in Ontario out of a deficit position just with the savings on this one aspect of overpayment on welfare payments. Just this one aspect would eliminate the backlog of cases and the deficits for children's aid societies, which is a problem our deputy is currently struggling with.

Mr Stapleton: Our own estimations are somewhat more modest than $50 million for Metro. They're somewhere in the order of $50 million to $60 million province-wide, but to take your question, yes, it's being --

Mr Jackson: We could eliminate all the deficits in Ontario with $50 million, but my point is, when will this be implemented? It's now working in Hamilton.

Mr Stapleton: Yes, it's now working, and it's starting all across the province.

Mr Jackson: When did that start, was my question?

Mr Stapleton: When did that start? It started November-December-January.

Interjection: November.

Mr Stapleton: November.

Mr Jackson: November-December-January. Okay. Because in October, when I asked the minister, she indicated -- it's on record with estimates -- that there was no program in place.

Mr Stapleton: Yes.

Mr Jackson: I'm pleased to hear it now is because we've been asking for it.

Mr Stapleton: There's no program in place. We are entirely dependent on the federal government to put the assignment in place because it has to pay the money to our municipalities and to the province.

Mr Jackson: I've read the letters from the federal government. That's why they had to work directly with the city of Hamilton. I wish to commend the ministry, after first being notified two years ago, that we're now doing it. I want to put that on the record. I think that's superb. It's unfortunate that when Hamilton first identified this as a potential savings, we didn't react quickly, because by your own admission of your own figures, we could have been $100 million in the plus from the moment Hamilton first said, "We can do a better job collecting this overpayment."

I know I've run out of time, but I hope Ms Hoy will join us this afternoon. I want to pursue this concept of the integrated approach, because Hamilton is not an integrated community but is taking an integrated approach. I would like to pursue that because I see some significant savings occurring out of specific offices in this province.

Mr O'Connor: I want to carry on a little bit with the line of questioning that my colleague Mr Callahan had talked about yesterday, and that's with the drug benefit plan. He had talked about the dispensing fee aspect of it, the cost there. Perhaps I could get you to explain about how the benefit works, give us a bit of detail around it and then maybe elaborate more on the dispensing fee aspect of it.

Dr Pascal: We'll be very pleased to do so. Mr Chair, I'll ask the panel's expert, Ms Fraser, to provide a direct, clear and precise answer to the question.

Mr Jackson: Why? Is that going to be a change from what we've been getting.

The Chair: Just ignore the interjections.

Ms Fraser: Thank you, Mr Chair. With respect to the Ontario drug benefit plan and social assistance recipients, the arrangement is this: A social assistance recipient receives with his or her cheque a drug card. That will be the case whether the person receives GWA or FBA. The person takes the drug card to the pharmacist with a prescription from a doctor and has the prescription filled. The cost of that prescription, including dispensing fee, is eventually billed back as part of the cost of social assistance for persons in receipt of social assistance. The mechanism is actually based on a card that the individual receives.

Yesterday there was some discussion with regard to a particular individual who I believe was in receipt of social assistance -- although it was not, I think, indicated which sort, GWA or FBA -- who had a prescription for an extended period of time and asked the very reasonable question why it was that she had to pay the dispensing fee on a repeated basis.

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I'm sorry, my memory fails me as to whether a number was actually quoted, but I've had some people look into this and I can tell you that the fee for social assistance recipients in terms of the dispensing fee is $6.47 per act of dispensing, if you will, that is, each time the client goes to the pharmacist. That would apply to all recipients of the Ontario drug benefit plan, both social assistance recipients and seniors. With respect to the fees for the general public, that is a matter between the pharmacist and the consumer and would be set by community conditions and so forth. It's not a regulated amount. The fee, then, would be paid on each prescription.

The issue, I think, that was raised was the issue of frequency of repeats or what period of supply the individual might be able to obtain. In fact there are limits, under the Ontario drug benefit plan, for those limits of supply. For GWA recipients, because eligibility is determined on a monthly basis and can change quite quickly, given the nature of the GWA allowance program, an individual can only have up to 35 days' supply of medication paid for in one prescription. With respect to family benefits recipients and seniors, I believe the time period's considerably more extended than that; it's 250 days' supply.

For the individual, I would suspect from the information provided that this individual was in receipt of GWA and was only permitted to receive 35 days of prescription on each occasion. That's in order to ensure that a person doesn't go off GWA and continue to have prescription drugs paid for under this program.

Mr O'Connor: That aspect of course is good, but I think Mr Callahan was referring to the periods that could be within that 35-day period where they could go back for several repeats, and that dispensing fee could add up.

Ms Fraser: Certainly the position is the authority is, and the pharmacist would have been encouraged, to fill the prescription up to 35 days if indeed that was authorized by the doctor's prescription.

Mr O'Connor: Does the ministry have any feeling as to whether or not this area could be abused or is being abused? I know it's not something the auditor looked into, but do you think there could be any abuse in that?

Ms Fraser: With respect to the drug benefit program itself, it's my understanding that the Ministry of Health is reviewing that program. They're in the process of reviewing that program in order to look at opportunities to avoid abuse and minimize expenditure and ensure it's directed to appropriate individuals. We have been cooperating to some extent with that review, but I think it's in early stages at this time.

Mr O'Connor: Thank you, Mr Chair. I'll yield the floor to my colleague.

The Chair: Does anybody else want to use up the remaining four or five minutes?

Mr Hope: I guess I can pursue some of the other areas. When we're talking about the collection, we're talking about possibly people who are still on social services and we're talking about those who may have found a job and they find it very difficult to meet the job needs. You know, when you're on social services and you get a job, usually you have to buy work shoes, you have to provide transportation and transportation costs may be there. Just to help people get off services they have to make some assistance programs available to them because there's nothing out there to help them.

If I look at the auditor's report, the auditor's report says -- I was trying to find the number of garnishment on wages. How would you come up with a number to make sure that you're not driving people back into more financial hardship by trying to recover those moneys that may have been an overpayment, no fault of the recipient, or may have been a misunderstanding of information? How do you work a system of that nature to try to meet the government's needs of these huge numbers of collecting the money back and meeting the needs of citizens?

Mr Stapleton: In each of those cases, for recipients, first of all, who go entirely off assistance, an individual negotiation would be made, usually at a more nominal amount as the person first gets into the labour market, but those will be done on an individual basis. For someone who remains on social assistance but is still earning -- in other words, who would be a recipient of the STEP program -- then it's quite likely in most of those cases that the recovery of any overpayment would be still made at 5% of the allowance, but not in such a way that the person's drug card or dental card or those sorts of things would be affected; but generally speaking, through individual negotiation.

Mr Iannuzziello: What's also important to keep in mind is that over the past summer what we've done is -- we have staff in each of the area offices totally dedicated to this particular function and they play a significant role in determining whether a former client does have the ability to pay the money back. The kind of judgements Mr Stapleton was just talking about are made before any further efforts are made to refer the case to central collection services.

What's interesting, when we look at the data, is in 1991-92 I think we collected $4.2 million. To date again -- we've gone over these figures over the past day or so but they're worth repeating, because to this point we've collected $6.7 million and it looks as if we will collect a total of $8 million for this year, which is double the amount we had last year.

Also, we've talked an awful lot about the number of referrals to central collection services. In the previous year we had referred a total of 293. This year we're already up to 960 referrals, so we are spending an awful lot of time and energy on overpayment collection.

Mr Hope: I'm going to reflect some of the concerns that are brought into my constituency office in my own area, Chatham-Kent. It deals with where we're providing more workers because we didn't do a good enough job in the past. Now we've got to do things better this time, we've got to be more efficiently staffed, we've got to ask for more information. Because we didn't have the proper numbers there before, we have the problem here today.

I'm looking at the human element aspect; I'm looking at it as the individual who's going to come now before me and start talking to me about a problem. The problem is that after 10 years of separation and 10 years of fighting to provide for her children and everything else, now the government wants her to go and pursue support payments. You haven't seen the individual for eight years, 10 years, and what you're driving is a human, emotional thing back on that individual.

I'm just wondering, as we're looking at trying to recover moneys, are we also looking at the human element. I know some people forget about human elements and focus on dollars, but I want to focus on the human element of driving that individual back to an understanding that you and I will never have of what that person went through in the separation. I'm wondering, are we looking at the human element when we're talking about recovering support payments.

Mr Stapleton: Actually, I think that's what you see in the situation where 70% of the cases are not being paid, or in fact that we only have support orders in 50% of the cases. One of the things we do is look at any situation of family violence, and where that's even suspected we don't even place a woman -- which is normally the case in these situations -- we don't place a woman in jeopardy in terms of sending her back into a situation, either with the estranged husband or the putative father, where that's going to affect her.

In determining whether there is a support obligation available, that's one of the very first things that's done, and in some cases we actually waive the support situation. But it's not waived for ever; it's always something we would come back to at another stage and in fact, if the situation had improved, then we would look at it at that point.

Dr Pascal: It's because of the balance among and between the human issues, the history of the need for support of children, the fiscal issues, that we have specialized workers, parental support workers who do nothing other than keep those things in balance as they deal with each case.

Mr Callahan: Mr Chairman, I have a little concern with that last answer --

The Chair: I'm sorry. You'll have to take that concern up this afternoon. The allotted time for this morning's questions has expired. We're now dealing with Mr Callahan's motion:

"That the auditor, under section 17 of the Audit Act, conduct a special audit of the Ministry of Government Services central collections division, with specific reference to the annual budget, number of employees, amount of collections referred to it; specifying the ministries and the amounts referred and the total received for the years 1989 through 1992-93 with the amounts successfully collected and any other relevant facts."

Mr Callahan, you could move your motion and I will allow approximately three minutes discussion for each caucus.

Mr Callahan: I so move the motion, Mr Chair, and I understand that the government members are going to support it. If that's not the case, I'd appreciate knowing that at this point.

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Mr Hope: I would only ask that a friendly amendment, in order for us -- and I've had a brief chance to look through this. I want to ask the Provincial Auditor a question. If we were to move the date to, say, 1987, to give us a reflective view, to see that trend, would there be a problem with that?

Mr Callahan: I have no problem with that. The only reason 1989 was put in there was that was the information that was given to us by the research officer, if you look at the material you've got there.

The Chair: Why don't we just agree that the motion read "1987"?

Interjection: That's fine.

Mr Callahan: If the government intends to support it, I would just briefly re-emphasize the importance of this, because if the amount of money that's being collected is less than the amount that we're paying to provide all of the accoutrements for a division of the government to collect it, maybe we should be revamping it and taking a look at it for a more effective treatment.

I'd even suggest that perhaps we might want to at some point -- I don't know when -- get somebody here from that specific branch to tell us what is the cause of this problem. Maybe it's underfunding. If it's underfunding, then it's kind of a wasted effort, even in these tough times, to withhold money from that organization if in fact the net result is going to be a limited amount of collecting of moneys that might be available for the consolidated revenue fund or for social assistance.

Those are my brief comments, Mr Chair.

The Chair: The auditor would like to make a point before we carry on.

Mr Peters: Because we had a brief correction and you added 1987 to it, I just want to alert you to the fact that the Financial Administration Amendment Act was assented to in December 1991. It had a very interesting provision which may be interesting for your deliberations, and that is that it permitted that the fees and commissions chargeable by collection agencies were now a direct charge against the consolidated revenue fund and did not come out of the ministry's own funds. This of course provides an incentive to go outside, incur fees and commission fees and collect them that way. I just thought I'd put it on the table for your knowledge because the historical movement of these funds will probably be influenced by that one.

I think, in the second part, I'd endorse your idea of inviting the ministries, because there may be a very interesting question as to whether this amendment to the act, for example, has significantly influenced their efforts. Since it was made in December 1991, they now have a little bit of time under their belts to determine that. I'm not sure whether there is a comment.

Mr Callahan: If everybody got that -- I guess they did.

The Chair: I think so. Thank you. Mr Jackson.

Mr Jackson: A couple of items, Mr Chairman: When Mr Hope was making reference to the Conservative government in 1988, if he's wanting to capture all three governments, it's a short -- if you checked Hansard, you were inferring that it could go back to 1988. I assume that you had a lapse of memory.

Mr Hope: The Conservatives weren't there.

Mr Jackson: Precisely. I'm glad you caught it.

Mr Hayes: You are getting paranoid, Cam.

Mr Jackson: No. It's just that the idea of 1987 -- I'm having difficulty engaging the auditors on a trip back down memory lane. I think that its most significant elements are what procedures substantively changed upon the implementation of the freedom of information and privacy commission laws in this province, and clearly that evidence will become apparent in any examination of an audit, but it would be more of a narrative than it would be reflected in the numbers.

I'd be interested in that because I think there's a serious impediment in this province to collecting fees because of the emergence of these types of legislation, and that's what I'm hearing from other provinces. So the point at which that legislation was brought in in this province has changed our ability to collect. Frankly -- I'm sorry?

The Chair: I'm not sure that's part of the motion.

Mr Jackson: We just received an amendment to start going back to 1987. I'm suggesting that I'd rather the auditor focus on the current year's activities to snapshot than to start comparing how many photocopiers we had and whether we had sufficient resources and material and personnel back in 1987. Frankly, I would much rather he do a stronger, more forensic audit of the given year of this ministry now to help guide us in improving it.

The Chair: So you don't want to go back to 1987?

Mr Jackson: I'm going to support the motion. I just think we're creating additional work for an already overworked auditor. We are adding to his plate with this motion and it's sometimes helpful to the auditor if we -- I recall, and this is no slight to Mr Peters, that Doug Archer was very quick to advise us of the extent to which any audit recommendation would engage his activities -- not that Mr Peters isn't helpful, not coming forward with that. He's our new auditor and we're very pleased and we think we have one of the best in the country.

My point is that I'm aware, having done audits on school boards in my private sector life, and know the kinds of work this motion now entails. To have it narrowly defined in a given year might be of more assistance to this committee, and I would certainly hope we might get some feedback from the auditor about the scope of work involved in this motion. I think that's a fair question, Mr Chairman.

The Chair: Yes, that's fair.

Mr Jackson: Other than that, I fully support the motion, as I indicated yesterday, but I frankly would have preferred us to invite someone from this ministry to come forward to answer some very brief questions before we voted on the motion. I would much rather that we voted on this with three or four other motions late Thursday and maybe invited someone to come for a half an hour before this committee. I'd certainly be willing to sit until the hour of 6 o'clock tonight or tomorrow night in order to achieve that but I think it may be a little premature, and we wouldn't need a motion which is so far-sweeping, the inquiry which this contains. It's still valid; it's just a lot of work.

The Chair: I hear you. It's a very good point, Mr Jackson. Maybe the auditor could take a moment to address the point that you've raised.

Mr Peters: I would be happy to, Mr Chair. The point of inviting the ministry in order to focus the audit is very much appreciated by us because it helps very much to get the sense of the committee as to the direction in which you would like to pursue the audit. As I pointed out before, in most of these kinds of audits you start with a funnel approach. You look at everything and you ultimately would like to focus on the significant issues. Certainly inviting the ministry would help in that regard. The alternative is just going to be in the timing. We will be doing it; we'll get it done as soon as we can.

The Chair: Okay. Mr Duignan.

Mr Duignan: Thank you, Mr Chairman. We will be supporting this motion. Mr Callahan raised a question, how much money does the ministry, this particular branch, spend in collecting the amount of money? On page 23 it indicates that in 1989 they spent $1.4 million in administration costs, of which they collected $7.8 million from debtors.

Getting back to my original question, or a question this morning: when we're doing this if we also could look at, in relation to a number of cases, the amount collected, and refer that to the number of cases that involved; and the percentage of cases referred for collection, what percentage had been acted on and money collected from it.

The other question I have is that in 1989 we reviewed the funds analysis of the $99 million receivable for 1989 and determined that approximately 50% of that amount of money originated prior to 1980. "The fund should review its accounts and consider a one-time write-off of all inactive accounts older than 10 years." I was wondering, has that been done, and if it hasn't been done, of the $140 million receivable right now, is that $50 million still included in that $140 million or not? In fact, has the recommendation to write accounts older than 10 years off been followed through on?

Mr Peters: You want us to include this in the audit? You don't want an answer right now.

Mr Duignan: No, not right now.

The Chair: The discussion on Mr Callahan's motion is now concluded. All in favour of Mr Callahan's motion?

Mr Hayes: Recorded vote.

The Chair: Do the members want a recorded vote?

Mrs Margaret Marland (Mississauga South): Recorded is fine.

The Chair: The clerk will call the names of the members. All in favour?

Ayes

Callahan, Duignan, Farnan, Fletcher, Hayes, Hope, Jackson, Marland, O'Connor, Sorbara.

The Chair: All opposed? None. Mr Callahan's motion is carried.

The committee stands adjourned until 2 pm this afternoon.

The committee recessed at 1201.

AFTERNOON SITTING

The committee resumed at 1416.

The Vice-Chair (Mr Joseph Cordiano): Members of the committee, I'd like to call to order the meeting of the standing committee on public accounts in our afternoon session.

Mr Callahan: Mr Chairman, on a point of order or a point of clarification: This morning we passed a motion asking the auditor to do a special audit under section 17. Just to be clear on how I understood the auditor in terms of having a person from that division come before us, I've just spoken with the auditor -- I'll let him speak for himself, but my understanding is that he would rather have someone here beforehand whom we could interview, and that would give him clearer direction as to where he should go, so that he's not spending a lot of time around the edges where we may not wish him to go. Is that correct?

Mr Peters: That's a fair assessment, yes. In these special assignments, we are finding it very helpful to better understand the direction from the committee, and that very often comes out in these kinds of hearings. I put it to you that I would advocate that direction.

Mr Callahan: I'd ask, Mr Chair, if we could have unanimous consent of the committee, that as we've pretty well grilled these people, as near as I can figure anyway, to the nth degree, we may perhaps be able to fit someone from that division in tomorrow, if that's agreeable to the committee members. Then the auditor can use the period between now and the March sittings to do his work. Then maybe, if there's a necessity to bring these people back, we can bring them back in March.

Mr Duignan: Are you indicating that we could finish with these witnesses this evening and then tomorrow morning deal with this issue?

Mr Callahan: Tomorrow morning or tomorrow afternoon.

Mr Duignan: Tomorrow afternoon is in closed session.

Mr Callahan: All right, tomorrow morning. I've asked all the questions I have for these people. I don't know about Mrs Marland and Mr Jackson, but I'm sure we could probably finish them off.

The Vice-Chair: Could I suggest that we're not giving people who come before us an opportunity to prepare themselves. I think it would be fair to request that they be before us in the afternoon, but certainly not in the morning. That would be a little too early to ask for. Mrs Marland, we haven't heard from you yet.

Mrs Marland: No. Thank you, Mr Chairman, because as you know, I do like to speak for myself.

The Vice-Chair: I've noticed, but it's certainly welcome.

Mr Callahan: Far be it from me to try to put words in your mouth.

The Vice-Chair: Order, please. Mrs Marland, you have the floor.

Mrs Marland: What are we dealing with tomorrow afternoon in camera?

The Vice-Chair: There was, as I understand it, a motion put forward by Mr Callahan to have the Government Services --

Mr Callahan: That's been dealt with.

The Vice-Chair: I know, but you're talking about having these people appear before us. I was going to refer to the Government Services central collection service branch, which you want to appear before us at some point tomorrow. I've suggested that the earliest is possibly in the afternoon, to allow for some time for people to be notified.

Mrs Marland: Mr Duignan said we're in closed session tomorrow afternoon, so I'm asking, what is it that is scheduled for closed session tomorrow afternoon?

Mr Duignan: I understand that tomorrow afternoon we will be dealing with the evidence we've heard over the last couple of days from the Ministry of Community and Social Services and making recommendations to the auditor on what this committee wants to do next. That's the reason for closed session. So I feel we should possibly deal with this in the morning.

Mrs Marland: I'd rather make that decision at the end of today, and see how this afternoon goes. If they don't come tomorrow, they could come next week, couldn't they?

The Vice-Chair: Because I think it's only fair to allow a certain amount of time for people to prepare to come before the committee, I suggested that the early afternoon would be reasonable. If we do want to have this group of people before us, perhaps we could have them appear for a short period of time before we go into closed session in the afternoon sitting. That would allow for some time to ask questions and clear this section up and then move into the closed session following that.

Mr Callahan: Mrs Marland has asked if we could have them next week. Well, we won't be sitting again until March 6, I think.

The Vice-Chair: We sit the week of February 22.

Mr Duignan: According to the chairman's schedule, it's scheduled in for the beginning of the week of February 22.

The Vice-Chair: I don't see why it would be too much of a problem to have them in the afternoon, accommodate that for half an hour, and then move on with our closed session starting at 2 o'clock; perhaps have them at 1:30.

Mr Duignan: With all due respect, Mr Chair, they may require more time to prepare to come to this committee to answer some of the concerns we've raised.

The Vice-Chair: Fair enough. What I'm going to suggest, then, as I don't see a real consensus here, is that the subcommittee look at this and try to decide what scheduling arrangements can be made.

Mr Duignan: That's a good idea, Mr Chair. The evening's getting on. Why doesn't the subcommittee deal with this particular topic?

The Vice-Chair: I would suggest that, and therefore we could proceed with our other business. Okay? We'll have the subcommittee deliberate on this matter.

I'd like to move on to our regularly scheduled session.

Dr Pascal: Mr Chair, I just want to follow up on requests for information. I said this morning that the 15 individual requests would be acted on in due haste. What I have is a list of questions for which we have information today and some questions for which we'll have most of the information tomorrow; we've summarized that. We have copies for the committee that we'll deliver to the clerk.

The Vice-Chair: You have that information in written form, and you're going to make that available. Fine.

Dr Pascal, are we going to deal with this matter first?

Dr Pascal: No, I'm just tabling information that was requested, Mr Chair.

Mrs Marland: They are probably the questions I raised last night, so I appreciate the promptness with which the ministry has responded to questions that were placed late yesterday afternoon.

Mr Jackson: You haven't seen them yet, Margaret.

Mrs Marland: Anyway, when we get into rotation, I'd like to speak.

The Vice-Chair: Dr Pascal, do you have additional information to present before the committee or shall we move into rotation and further questioning? I'm not quite sure where we left off this morning, so I ask the committee's assistance in this. Is the government next on questioning? It was Mr Hope, so we'll turn to Mr Callahan and continue with the rotation. Mr Callahan, you have the floor.

Mr Callahan: I was asking you yesterday about the impact of the federal UI changes which kicked in April 1: what impact and whether you had made preparations for the impact of that. Perhaps I should ask you, was there any consultation with the federal government, either at your request or its request, before it considered bringing in these rather draconian amendments?

Dr Pascal: No.

Mr Callahan: None whatsoever?

Dr Pascal: We were not in a position to consult with them about something we did not know was in the works, because they didn't consult with us.

Mr Callahan: Okay. Your ministry encompasses a number of areas, including this particular type of coverage. As far as you know, have there been any considerations in your ministry about the impact on other areas of your ministry? I'm not trying to be a fed-basher, but it seems to me that the direct impact of the UI amendments -- I think people viewing these committee hearings would understand that as of April 1, it's my understanding, if a person is fired from his or her job, he or she will be denied any unemployment insurance coverage, even though he or she has paid into it and was entitled to it.

Interjection.

Mr Callahan: Maybe you could clarify it. I thought it was only if they were fired, but apparently if they quit, they're not entitled to UI benefits. Is that the understanding?

Dr Pascal: That's correct. The controversy arises, of course, in those situations where taking leave of the job -- I'm being descriptive of the discussion in the public domain -- may be for reasons other than personal choice under ideal circumstances: workplace harassment and those types of things. But I think you've got the basics.

Mr Callahan: I think it's important that the public understand that, although at first glance that may appear to be a very salient approach to take to unemployment insurance, in fact what it very possibly could do would be to allow an employer to manipulate his or her employees to the point where they become captive employees, because if they quit or they're fired, they're literally going to be thrown on to the social assistance of this province, and the taxpayers of this province, in turn, are going to wind up paying for benefits out of their tax dollars that should have come out of unemployment insurance premiums that had been paid by those people for that service.

It also seems to me that if unemployment insurance is truly what it says it is -- insurance -- and in fact the premiums are paid for by workers of this province and, for that matter, Canada, that's a totally draconian approach for the federal government to take to the question of unemployment insurance. It may have a sexy first look, but I find it absolutely abhorrent, and I'd like to canvass whether or not you feel you've got an accurate handle on just how much this is going to cost you.

Dr Pascal: Obviously I don't wish to characterize in one way or another the policy itself. My job as a bureaucrat is simply, as Mr Callahan is requesting, to assess the impact. We assess the impact in terms of cost to be somewhere between $50 million and $70 million. The discrepancy is due to the qualitative assumptions that are made when we try to figure these things out.

With respect to other impacts, I guess the only other impact I can envision is as an employer, as well as a ministry that has an indirect relationship with 7,200 transfer payment agencies which in turn are employers. Apart from that, I don't know if others on the panel have other impact responses to make, but in terms of cost to our system, UI payers who've severed the relationship with their employers coming on to social assistance we assess at about $50 million to $70 million, somewhere in there.

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Mr Callahan: Okay. I'd also appreciate it, if it's not a great deal of effort, if you could provide to this committee at some later date the financial impact of the changes in the workers' compensation coverage I referred to briefly this morning. Again, just for clarification, workers' compensation is now going to require that the employer pay workers' compensation insurance fees for people who are volunteers, who are job trainees. Of course that's going to impact on employers outside the governmental system, but it's also going to impact on government. I would like to know what impact that will have on your ministry so we can determine just how much more money is going to be taken out of the moneys available to you to service the people you're supposed to be servicing.

Mr Hope: Mr Chair, what does the request that's being made about workers' compensation assessment have to do with the auditor's report? I don't see workers' compensation even mentioned in the auditor's report. I'm just wondering what this request that's being made -- it's substantial -- has to do with the report. I just ask for clarification. If he's right, so be it; the information will be provided. But what a cost factor of workers' compensation has to do with the auditor's report --

The Vice-Chair: I will allow Mr Callahan to clarify that a little.

Mr Callahan: Would you like me to explain why I'm concerned? The auditor's report of course came out at a time prior to this policy being laid on the table. The auditor's report refers to a number of things, most of them being not enough employees and so on. Of course that all impacts on cost.

You may recall, Mr Hope, that I asked of the delegation this morning what the cost of the new policy that would require accident insurance coverage for volunteers and trainees would be to the government as an employer, because particularly through social assistance, if the STEP program and other things are to work, that's what it's going to try to do, put them out in a trainee situation.

Two things can happen there. First, if the employer says, "I'm not going to pay for it, and if you want to have them come and get a job, you're going to have to pay for it," that's going to impact financially on this ministry. For children's aid societies, if they have volunteers, and I'm sure they have numerous people in a volunteer capacity, it has far-reaching implications. I'd like to know if they can give us a ballpark figure of just how much that's going to cost, to be taken out of their already capped budget. And I don't say that disparagingly: In these hard economic times the Treasurer has to make some tough choices. But what impact is that additional policy going to have on their budget and thereby make their service that more difficult to provide? If the auditor goes back out, as I'm going to ask him to do for next year, is he going to come back and say, "You hired 450 extra workers, but your system is not any better"? And they're going to come back and say, "We hired them, but we had to cut back here, we had to cut back there; we couldn't give cost-of-living increases" or whatever. I don't want to see that happen. Generally, I think we're entitled to canvass that within the framework of this committee.

Dr Pascal: Mr Chair, we would be very pleased. As our own analyses arise from what began a few days ago -- that is, the moment we read articles to which Mr Callahan referred this morning -- we set in motion within our own ministry a group of people to begin assessing across all of our programs the impact of the WCB decision proposals. This will be true, of course, of every ministry. We have 7,200 transfer payment agencies which depend heavily on volunteers. We ourselves as an employer have many people from college programs on work placement, social service workers and developmental service workers, so it does impact. It will also impact on some of the things that are proposed in some of our major reform areas.

The only thing I need to say, by word of caution, is that the impact analysis which has to happen across the board is going to be an ongoing process. I can't say there'll be a single point in time where it can all be made available to the committee. But as it arises, if the committee so desires, if you wish to request that information of our ministry, we'd be pleased to provide it as it becomes available.

The Vice-Chair: Just on a question of clarification with regard to the handout we've just received, I was particularly interested in some questions I had the other day with regard to a cataloguing, if you will, of changes with respect to the system we have in place today versus what was there before these changes were made. Is there any information about that in this document?

Dr Pascal: Mr Jackson, I believe, yesterday asked for an update of SARC recommendations, Transitions recommendations, and where we're at, as well as Back on Track.

Mr Iannuzziello: There was also the question about updating the eligibility review manual. That information will be provided tomorrow morning.

Dr Pascal: It's question 12; we'll have that tomorrow morning.

The Vice-Chair: Thank you. That was just for my own edification. Mr Callahan, you have five minutes left.

Mr Callahan: Just to go a little further on that issue, as I said this morning -- there may have been some members who were not around -- you've raised the impact by saying that it's not just your ministry and that it's not just money that's going to be affected. I think the most significant feature is that things like candy stripers and people who work for children's aid societies on a volunteer basis may soon become history, because if the hospitals, with their strapped budgets, have to pay the WCB stipend for candy stripers, they're gone. The children's aid society in my community, as I'm sure in many communities, is struggling to carry out its mandate -- a statutory mandate in many respects -- because of the cap on funding; they're going to lose all sorts of volunteers. I can think of the Elizabeth Fry Society and a whole host, thousands and thousands, of volunteers across this province. I certainly hope your ministry, through your liaisons with other ministries, might have them take a good hard look at this and the impact financially.

That's one thing. But I think the most important impact is the question of the myriad, those thousands and thousands of good people in Ontario, who volunteer their services and may very well find themselves having to become extinct because the bodies who are employing them or using them can no longer afford to pay the additional cost that is going to come from this policy.

That's over and above the obvious impact, recorded in Mr Mackie's article, that the employers out in the private sector are going to have to pay some $8 million a year. That's going to mean the end of co-op programs and it's going to mean the end of any trainee programs, I would think, because no employer, even if subsidized by the government -- unless the government's prepared to include in that subsidization the cost of that WCB premium -- is going to hire these kids or these people on social assistance.

That's tragic, because I think your ministry was going along the right road, trying to get people on social assistance out of that rut and back in the workplace. With one fell swoop, I suggest that the policy that has been indicated, at least, will take place through WCB is an ill-founded one. This committee should send out in our report a very loud message that we do not agree that that's a wise policy, considering the economic times. I think we could include it in our message with the report about social assistance, because it does impact on that and the success with which you people can carry out your mandate.

Those are my -- not questions, but as Peter Trueman used to say, "That's not news, but that too is reality."

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The Acting Chair: It's the end of your time, Mr Callahan, that's what that is; we'll have to move on. Mrs Marland, you have the floor. You're next in line for questions.

Mrs Marland: Dr Pascal, I'd like to return to the subject of overpayment write-offs, because the more I read about that particular area and see the comments the auditor has made about the number of dollars involved, the more concerned I become. What I really would like to hear, on behalf of the taxpayers of the province is some -- I know we've got a systemic problem that obviously has been accelerated in the last two years, but I'd like to talk about the years before the past two years, where we have been in a recession.

I want to read, in the auditor's comments, the paragraph that really gave me a great deal of concern. It's on page 7 of his long-form sheets:

"The Ministry of Treasury and Economics requires that opportunities to recover amounts owed, even subsequent to write-off, should be pursued. However, some former recipients who had their overpayments written off were again receiving family benefits allowances. The overpayments previously written off were not reinstated for recovery.

"We estimate that $2.6 million in overpayments written off in 1988-89 and 1989-90 pertained to recipients who were again receiving assistance."

Just in this one group of people we've got $2.5 million. I recognize that when these people come back on the system it's because at that time they need welfare assistance, we hope. I mean, the legitimacy of their being on the system and receiving assistance today is because they're eligible, and I know that's not the time you can say to them: "I'm sorry, we can't help you today. We're going to close the door in your face today, even though you're eligible, because you owe us X number of dollars because you were overpaid last time you were on the system."

I don't deny the fact that we all share in this responsibility to look after each other when we need to be looked after, which is what the welfare system is about. It's about people who earn paying income tax, and that money being used to support other people who are not in a position to support themselves at a certain time in their lives. But when people walk away from overpayments, it's fraud, isn't it?

Dr Pascal: It is somewhat described by omission or commission. They would put it in the general neighbourhood, but there are varying definitions of fraud. Every province has a different definition.

Mrs Marland: The Criminal Code defines it, doesn't it?

Dr Pascal: But if it's due to administrative error and they've not been, according to policy, informed, I would not place that particular case in the context of fraud.

Mrs Marland: Okay. Let's deal with the cases where they have been informed. If you've been informed that you have been overpaid on a welfare support dollar and you continue to receive that overpayment, and I would guess, when we're talking about this category of overpayment -- maybe you'd like to elaborate on that, but if we are talking about a category of overpayment, we're obviously not talking about a few dollars here. If it reaches the point of requiring a write-off because it's uncollectible, it obviously is in most cases a substantial amount. So if you're talking about somebody who has been notified that they have received money from the government for which they are not eligible, then surely it's fraudulent to keep that money, because they've been given notice.

Dr Pascal: A couple of things: First of all, the Supreme Court of Canada next week will begin discussing the Findlay case, which will address the issue of overpayments to welfare recipients and the constitutionality of repayment. Second, I think it's important that you hear very clearly from us that we agree with your concern that when there has been overpayment, at this particular point in time it is our policy to pursue that overpayment.

With respect to that policy in practice, you and the Provincial Auditor have found our interventions lacking and inconsistent. We accept that criticism and we have, through intervention of staff, through tighter accountability and assignment of staff to be accountable, begun to recover in major amounts, totalling about $8 million in about 9 to 10 months from non-recipients. With respect to recipients who become non-recipients and then return to the program, we also have been remiss in a consistent way across the province, and we have taken steps to ensure the kind of integrity that you and the taxpayers would want to see. Just because they've been written off does not mean that the pursuit of overpayment would not be part of our action.

When they return, you're quite right; by definition, they are in need of benefits and how quickly we can recover becomes an issue. We recover at a rate of 5% for each cheque as part of the repayment plan.

Mrs Marland: You refer to a case that's going to the Supreme Court. Is this the first time a case of fraud through a welfare recipient in that particular category has --

Dr Pascal: As I said earlier about the greyness around describing certain overpayments as fraud, this is a case that obviously the plaintiff is not going to argue that having been overpaid through administrative error, the individual should be required to repay, but --

Mrs Marland: Is this the one where they got the computerized cheque with all the extra digits?

Dr Pascal: Ms Fraser knows in great detail from her legal background as well as her current job.

Mr Jackson: In what jurisdiction is this claim?

Ms Fraser: The case we're discussing is the Findlay case and it arises in Manitoba, where the individual failed to report certain income and as a result was later assessed an overpayment and is now taking the position that the Canada assistance plan, under which these allowances are cost-shared, prohibits the reduction of his allowance in order to recover that overpayment. That's the case that's going to the Supreme Court.

Mrs Marland: How much was the overpayment, approximately?

Ms Fraser: I do not recall the total value, although I believe the cumulative total was in the thousands. But I can't be precise; I'm sorry.

Mrs Marland: I'm sorry to interrupt you, but I find it interesting because I asked you yesterday about the $38,000 example, which I think is also in the overpayment category. Was the $25,000 one also an overpayment, the one I asked you about yesterday? It was? I find it interesting that here in Ontario we have an example of a $25,000 overpayment and a $38,000 overpayment and not only are we not at the Supreme Court with it, we haven't even proceeded to have any charges laid against those individuals. What is it that they're doing in Manitoba that they've obviously had a case which is now being appealed by the client?

Dr Pascal: First of all, in every case where we can identify an overpayment and with our interventions can proceed to investigate and follow through, we are doing so, including the cases raised by the Provincial Auditor. In some of the cases raised by the Provincial Auditor, some of the traditional problems of tracking, in terms of migration out of the province or missing addresses, are part of the problems of pursuit, but we don't disagree that there are problems of overpayment which should be pursued, and we don't disagree that in the past our vulnerability has been very real. We agree with that and we're doing something about it.

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Mrs Marland: But it's very difficult for the public to understand. Speaking on behalf of that public that doesn't understand, with the sophistication of computer systems and SIN numbers and everything else, it's very difficult for us to appreciate that people just disappear off the planet, because there are two ways people survive. They either work and earn money or they receive assistance from some government agency, or they steal; otherwise, they die from lack of shelter and food.

Mr Callahan: Or enter politics. That falls somewhere in between either category.

Mrs Marland: Excuse me, Mr Callahan.

The Vice-Chair: Order. Mrs Marland has the floor.

Mrs Marland: If you are receiving assistance from a government agency or you are employed, you certainly are trackable. Surely there must be a very simple cross-referencing system where, if one of your clients has taken off with $38,000 that doesn't belong to him, the next time that person surfaces in Canada, his SIN number is flagged at whatever agency's door he's at asking for more assistance; alternatively, he now has a job and his employer is notified through the connection through UIC. There are all kinds of ways. I can't believe that people can just disappear.

Dr Pascal: First of all, every attempt is being made, within the freedom of information and privacy environment, which is something about which we have to be cognizant, to do data matching, to harmonize with the UI information, as we discussed this morning, and to pursue on a bilateral basis interprovincial agreements around data matching to prevent duplication and collection from one to the other. We certainly don't disagree that the public at large deserves increased integrity in terms of follow-up.

By the same token, while not underestimating the seriousness of it, we don't want to overestimate the yield we will be able to achieve when we continue to pursue overpayment in a very vigorous and rigorous way.

The Vice-Chair: Pardon me, Mrs Marland, you have two minutes left, and Mr Jackson has indicated he has a question. I don't know if you want to proceed or --

Mrs Marland: I just want to finish this line of questioning. I'll give Mr Jackson the next round.

The auditor says on page 7, "There was no evidence that any efforts had been made to locate these recipients." He says: "The reason given in 60% of the write-offs we reviewed was that the whereabouts of the former recipients were unknown. There was no evidence that any efforts had been made to locate these recipients."

Are you suggesting that these recipients can be shrouded behind the FOI? I want to tell you, I received my federal income tax label through the mail this week, the little label they give you if you submit your own filing, and I was absolutely floored: There's my name and my address and my SIN number on the label that's going to go through anybody's hands, through the post office and anywhere else. So I can't believe that these clients can be shrouded behind freedom of information. I'm interested to know whether you can't access them because they are protected under FOI.

Dr Pascal: The fact that Mrs Marland has said she was floored I think indicates the sensitivity around issues of where the SIN rises.

Mrs Marland: But I don't owe $38,000 to the taxpayers.

Dr Pascal: I think what's really critical is that Mrs Marland has reinforced very clearly that the ministry's practice in this area has been less than satisfactory. I couldn't agree more: It is less than satisfactory. In the 60% of the cases where they have been written off without any follow-up, we have no excuses other than the burden of the case load on all the workers in our offices, but it's unacceptable.

Mrs Marland: You don't agree with it?

Dr Pascal: It's totally unacceptable, you're absolutely correct. Our interventions around assigning dedicated staff both to do the work itself, as well as to hold those doing the work accountable, has been put in place. We plead guilty with respect to the practice. The performance has been less than satisfactory. We agree entirely. I certainly do.

Mr Iannuzziello: I want to emphasize the point that Dr Pascal made about how in each area office we have dedicated staff to this function, which we didn't at the time of the auditor's report. We have people in each office working solely on overpayment recovery.

Mrs Marland: As a result of that, are you seeing a reduction? How many months are you talking about? The last four months?

Mr Iannuzziello: Since last April what we've seen is that we've virtually doubled the amount of recovery.

Mr Jackson: What's your projection?

Mr Iannuzziello: The projection for this year is $8 million, whereas last year --

Dr Pascal: That's for non-recipients.

Mr Jackson: Can I clarify that, Mr Chairman? First of all, we have a recovery number of $300 million that the minister gave us as your potential savings. You gave us a figure of $8 million on those people who should have gone on CPP but are on FBA, and now we have another $8 million?

Dr Pascal: No. The $300 million consists of all of our interventions. It consists of training opportunities and job referral. It's inclusive when it comes to the rate deferral.

Mr Jackson: Without your walking through it, I did request whether you could give us the breakdown of that, if that is still possible, how you arrived at the $300-million saving. It's difficult for us to receive an $8-million saving on this, an $8-million saving on that. There are so many categories where the auditor deems the ministry to have failed in terms of accountability, it's hard even for this committee to keep up with all the different categories you're attempting to rectify.

The Vice-Chair: I'm going to allow a short answer on that, because we've run out of time.

Mr Jackson: Just for clarification.

Dr Pascal: It's an important question. The short answer is that we'd be pleased to give you the breakdown, recognizing that some of the subcategories are elastic in both directions, but I'll provide a little more detail than I did in my remarks yesterday, where I paraphrased the sources of contribution to the $300 million. I'd be pleased to do that.

The Vice-Chair: I'm afraid I have to move on to the next round of questioning.

Mr Duignan: Talking about disappearing people and disappearing money, I've just got some information here talking about disappearing federal dollars. I want to spend a little time talking about that right now. In the federal budget of 1990-91, the budget placed an extended growth limit of 5%, a cap on the Canada transfer payments from that period of time on, for three provinces: Ontario, Alberta and British Columbia.

I'm just looking at the growth limit on that over the last number of years. In fact in the 1990-91 year there was a $400-million shortfall, in the budget year of 1991-92 there was a $1.3-billion shortfall and in the year 1992-93 there was a $2-billion shortfall. Because of that cap of 5% growth limit, the standard Canada assistance plan recovery from the federal government would have grown, if that wasn't in place, from 38% to about 42% of ministry expenditures from 1989-90 to 1992-93. Because of the growth limit, in fact it has decreased from 38% in 1989-90 to an estimated 24% for the 1992-93 fiscal year.

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I understand that if the federal limit on the transfer had not been imposed, the transfer would have grown in the last two years from $1.37 billion to over $3.3 billion in that period of time. That growth would have been driven by the increase in the federal government's share of the social welfare costs, which roughly would have increased something like 96% in that period of time, and child care and child welfare costs, which would have increased 23% in that period of time.

In a period of massive recession and massive increases in income maintenance because of the recession, I believe this limit means a federally driven increase in Ontario's deficit and provincial debt. In your particular department, what type of impact has that cutback had on the FBA program?

Dr Pascal: The financing of that program, of course, has put enormous pressure on us, as I said yesterday, and you've just reconfirmed it. The cap on CAP has had a three-year impact of between $3 billion and $4 billion, and counting. It has put, without being able to plan for it because it was done without notice, a major pressure on the ministry specifically and certainly the government generally.

That doesn't of course suggest that any of the things the Provincial Auditor has discovered in terms of the administration of the program shouldn't have proceeded anyway. But in terms of financing the program, financing and investing in reform and investing in technology, having that revenue along with some of the initiatives we're talking about would have given us perhaps greater opportunity to move more quickly. But I don't want to suggest an abrogation of responsibility to have moved on the points noted in the auditor's report in any event.

Mr Duignan: In fact over the last three years there's been a shortfall of some $4 billion to the program, which the provincial taxpayer again had to make up, because we had to increase the deficit for the shortfall in the federal dollars. What's the planned shortfall for the 1993-94 fiscal year for the FBA program?

Mr Callahan: I thought the Treasurer included that.

The Chair: Are you asking me? You're out of order, Mr Callahan.

Mr Duignan: I'm just wondering what the expected shortfall for the 1993-94 fiscal year is estimated to be in the transfer payments to your programs.

Dr Pascal: You're still on CAP?

Mr Duignan: Yes.

Dr Pascal: I'm sorry, you're asking for the latest instalment of this activity, and I don't have that. I just know that to date it's about $3.5 billion, but if you're asking what's the next phase of that in terms of impact, I don't have that. We can certainly provide that tomorrow.

Mr Stapleton: One matter that might be of interest is simply the cost-sharing ratios themselves. On a program like the family benefits program, which did have a 50-50 nominal cost-sharing formula, the very fact that the federal government now pays in the neighbourhood of 26% to 28% means that the province's share of that program alone has gone up over 20% and is now in the 70% to 74% range.

On general welfare assistance too, which is a program that has a nominal cost-sharing formula of 50% federal, 30% provincial and 20% municipal, we now see the province reversing its role with the federal government and actually paying the lion's share of the cost there. Although the municipal share nominally stays at 20%, the provincial role now is again over 50% while the federal role is in the 28% area. Just using percentages as another way of measuring the order of magnitude in terms of the changes because of Bill C-69 and its subsequent passage at the federal level is an indicator of the massive changes that have taken place as a result.

Mr Duignan: Just using a formula based on a rough estimate of what your budget will be next year, in fact the federal shortfall could be in the range of about a $2.7-billion to $3-billion shortfall in federal revenues, which would put the shortfall for the last three to four years at nearly $7 billion from the federal government to your programs.

Dr Pascal: That's probably not out of line in terms of your projection.

Mr Duignan: Thank you, Mr Chair. I understand Mr Hope has a question.

Mr Hope: I'll just jump right in. I'm going to try and pick up, because it was interesting, the comments that were being made and the fine work that our legislative research people do. It says, "Ontario to Ottawa: Where's Our $4.4 Billion for the Province of Ontario?" But I guess we'll still searching for that answer.

Today's debate and yesterday's debate have been focusing totally on fraud, and I just wonder how many people actually cheat on their income tax returns. That's another area. I guess as we talk about the fraud aspect of it, I would wonder, as we're talking about trying to recoup, the focus of the conversation has really thrown me off, because just sitting in the committee makes me feel that everyone on social services is defrauding the system. We've heard numbers that are like people throwing the dice and trying to figure out which number's going to come up first. We've heard projections of 2% fraud, 3% fraud, 5% fraud.

Mr Stapleton, you mentioned something about research documents yesterday, and I guess my question would be, what are the real numbers that we're looking at in terms of fraud, and do we have any research about what's going on around this issue about fraud?

Dr Pascal: The short answer is that I don't know. What I said yesterday I will say again today and that is, what we have decided to do is put all of our energy into identifying, detecting fraud and acting on it in a way that respects the overwhelming number of welfare recipients who are not defrauding the system, so that we don't overpolice it in a way that creates blows to the integrity of honest people.

But with respect to the research, I asked Mr Stapleton for a copy of a study that was done in 1987 by the Canadian Research Institute for Law and the Family. There are just three very short points that I'll read in response to your question, Mr Hope:

"Due to the nature of welfare fraud and how it is measured, there has been little reliable and objective research conducted. The actual incidence of welfare fraud is unknown.

"The literature indicates that the perceived incidence of welfare fraud is often exaggerated due to the prevailing negative attitudes towards welfare recipients.

"A few reliable studies estimate that the actual incidence of welfare fraud varies between less than 1% to almost 10% of all welfare cases, excluding unintentional client error and administrative error."

I guess what I'm trying to say again today is that the most important thing is that we put in the resources required to ensure the system's integrity and protection against fraud. As we do a better job with that, we'll be able to answer the question of incidence with more sophisticated intervention. I'm sorry that the answer continues to be a moving target. Again, our interest is in ensuring that most of our time is spent in trying to deal with the issue as identified by the Provincial Auditor.

Mr Hope: Why I bring it out is because, like I said, two days of this now and we've been talking about recovering overpayments, we've been talking about people not supplying information. It just seems to me that the viewing audience that is not part of the ongoing discussion here must think that 50%, 75%, 80% of the people on social services are defrauding the system. I just want to indicate that the auditor makes reference to 3%. That's the type of area as a percentage that we're talking about.

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Mr Joseph Cordiano (Lawrence): On a point of order, Mr Chair: Could Mr Hope clarify that point that he was trying to make, as I think it leads us off base a little bit here with respect to what other people said. We were dealing with what the auditor's comments were, and I think what other people said or may have said was a little off topic, trying to make the point flow from the auditor's report which is, I think, the point he was making about Mr Callahan's point of order a little while ago. But I think it's important not to use figures and go astray on these matters. Would he clarify what point he was trying to make there?

Mr Hope: If you look at the report on page 5 of the information that's provided for us, it says "at least 2.59%" and it's 3.66% of the total payments. So they're talking about the fraud, welfare fraud represents at least -- it's in your report, if you read your report. I think the information I'm bringing up is more valid than the information brought up on the WCB, but what I would like to focus on, if I may --

The Chair: The only point I'd make on that 3.66% is, that's not the auditor's figure, that's the figure the auditor accepted based on a report done for the ministry. The auditor did not come up --

Mr Hope: It's in the report, in the body of the report. Am I wrong? It's in the body of the report, right? So it's part of a report.

Interjection.

Mr Hope: Okay, thank you. Now, I'm going to ask a question dealing with UI, because Mr Callahan has brought forward a number of concerns around unemployment insurance and asked about the impact of UI with the current changes that are going to take place April 1, I believe it is.

I was interested in listening to some of the comments he made at an earlier stage, of when the increase of growth happened around social services. I believe that is very reflective of a time frame that changes of UI had happened called Bill C-21, and I remember playing an active part. I remember the federal government making a comment saying it was modest changes to the Unemployment Insurance Act. I remember making comments saying it was draconian changes to the Unemployment Insurance Act.

I'm wondering -- through those changes that took place by the federal government in 1990, with the changes to the unemployment insurance, and the changes -- because you're going to look at changes that are taking place currently -- what offloading has occurred by those changes in unemployment insurance and has now put pressures on our social service program in the province of Ontario?

Dr Pascal: I'll ask Mr Stapleton, because your question is a trend analysis, it's historical. I'll ask John to respond to that.

Mr Stapleton: I think one of the most important things coming out of the C-21 changes is that for the very first time -- it was absolutely unprecedented in social assistance in this province -- social assistance led the recession in the sense that the case loads we saw on our general welfare assistance program and our family benefits program actually started going up in a very major way before the unemployment insurance figures started to go up.

What that actually tells you is that people came to general welfare assistance and to social assistance programs in general in Ontario before they went to the UI program. Now, although that has to do with such things as people having shorter attachments to the labour market, part-time jobs and not being able to get the amount of weeks, it means that for the first time the UI program didn't act as that first line of defence, if you will, before social assistance, and rather than social assistance being the safety net it became the first line of defence.

With the further changes, as Mr Pascal has already stated, we are possibly likely to see a further hit from that, but it remains to see how great that will be. Certainly the C-21 changes in combination with the labour market changes that had taken place were responsible for an unprecedented change in the system.

The Chair: Your time expired at 3:12; I added a couple of minutes because of the interruption.

Mr Hope: I know you're always precise, so I stopped.

The Chair: Mr Cordiano, 15 minutes.

Mr Cordiano: I would like to lead the discussion in perhaps an area that is not easily definable or, shall we say, easily answerable in this regard. Let me start off by recounting what I heard on a radio station phone-in show one night as I was driving home. It was an anonymous caller. The anonymous caller was one of your eligibility officers, I think, filling out reports, visiting with clients at home etc. These were general views being expressed on this show but, trying to summarize the scope of this phone-in conversation, generally speaking, the person who was the eligibility officer, the anonymous caller, felt that the present situation, with the plethora of programs and new requirements, left gaping holes in the system opening it up to all kinds of abuse, that what used to be a very tight system or constraining set of rules were now no longer in place and that people were in fact abusing the system, people who were doing that because perhaps they had no other source of income but at the same time had all kinds of other assets which were not being looked at.

All the eligibility requirements have changed now. If you can bring me up to date on understanding that, those are the things I've requested: the kinds of changes that have been introduced from a policy standpoint in terms of eligibility. But the point I'm going to try to make to you is that there's a view out there that people who are not really entitled to receive assistance under these various programs are in fact receiving assistance. That's really the perception that exists at the present time with the larger public.

Dr Pascal: Mr Cordiano, I'll respond in two parts, because you're raising a couple of questions. You're raising, first of all, the issue of eligibility. We'll be pleased to provide you with recent changes to eligibility, but I think the central concern you and I share is the issue of fraud. As I said yesterday, most welfare recipients are among the most concerned about the issue of fraud, because they wish the integrity of the program to be established and maintained.

I can't comment on an anonymous call of an eligibility review officer, but I can comment on meetings I have with eligibility review officers. The most recent one was several weeks ago -- I mentioned this briefly yesterday -- when I spent two hours with 15 EROs in our Toronto area office, where they discussed the nature of their work in great detail. I was left with a couple of very clear impressions.

One, they're doing their job. It is generating at least three times the salary per ERO. The nature of the integrity breaches are of major concern, and they've established in this particular office some relationships with local detectives for follow-up.

One of the clearest impressions I got is that there are some very sophisticated groups of people out there who look at all systems that are under extraordinary pressure from participation in the system, whether it's a tax system or cross-border shopping and what's assessed at the border during peak hours, whatever the system might be. I cannot characterize the cases because of the nature of certain things being brought forth for prosecution, but I got the clear impression with most of the interesting cases that there were people who were basically spending a Thursday night trying to figure out how we are, in an intelligent way -- including people who work in mainstream society. I can't characterize it beyond that, because there's one case that comes to mind which, when it does become public, will provide a sense of the nature of what's taking place.

But there are problems. If an eligibility review officer did phone a radio station and say there's fraud in the system, I hope he or she would also have said he or she is doing something about it. If they are one of our EROs in the Toronto area office, I assure you that the excitement about their work and the fact that they're doing it not as a welfare police mentality but to ensure the integrity for honest people on the system is something I'm quite proud of in recent months.

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Mr Cordiano: Well, it disturbed me, because the suggestion was made that there wasn't the kind of determination and thoroughness because there simply wasn't the time to do a thorough examination, that there were other hindrances which prevented eligibility officers and others from thoroughly examining what was being presented; in fact, that there was no direction that this was to be done. I don't know what it's attributable to; perhaps, as we've seen from the auditor's report, a lack of personnel or what have you. The people who were in place -- and, I would say, are there today -- may be more enthusiastic than they were because there have been indications that things will change, but they're continuing to be under serious constraints, serious pressures, and cannot thoroughly do their jobs.

Dr Pascal: Again, I really don't want to comment on an anonymous call, the origin of which can't be validated by either of us. I simply know from what I'm told and what I've experienced directly that they know what their job is.

Up until quite recently, many of our parental support workers and eligibility review officers were at the front door because of the load, because of case loads of over 500, where distinguished, experienced and committed leaders like Mr Rowe, who's over my left shoulder, are there to ensure the number one legislative priority, which is bringing people in the front door and establishing eligibility, for which the Provincial Auditor found us satisfactory -- it's one of those few parts of the report card where we seem to be doing relatively okay, in terms of establishing initial eligibility; we have some problems with respect to updating of information. But indeed we had eligibility --

Mr Cordiano: May I interrupt you? The comments that were made about the problems associated with this were to do with updating information and then the follow-through, if you will: getting information that was more up-to-date and therefore changing the status of a person's eligibility. Officers had heard indications that there were people who had reported other people, yet there was no follow-up to ensure that that update was being made.

Dr Pascal: Some of the examples, Mr Cordiano, that you've just used, I wouldn't put in the category of fraud but of an overburdened system where proper information, both the getting and giving of information to the client and from the client, has placed us in a vulnerable position. I think that's a very accurate criticism. If that's part of what the person commented on, I think that's fair.

Mr Cordiano: Call it what you will. I don't think at this point it's essential that we say that's a fraudulent situation. What we do know is that it ends up being in contravention of what is required for eligibility, so therefore there's a violation. I presume we can call it money that's being expended that should not be expended. "Overpayments" is probably the way to describe that, as a result of changing eligibility status.

Dr Pascal: Other than the fact that the only way in which we can effectively intervene requires a finer kind of subcut with respect to the distinction between fraud and overpayments of different varieties. But yes, we have an overpayment problem that has many contributing subcategories, and you've alluded to a couple, very importantly.

Mr Cordiano: It's difficult to get at this, because we don't have what I thought was important information; I know you've indicated you will probably provide that for us some time later. But it certainly could be said that some of the changes that were made in terms of eligibility criteria, as policy matters, have led to that situation as well. Am I correct in saying that?

Dr Pascal: Every time there is a change to eligibility rules there is very strong effort -- it's obviously had some problem from time to time -- to ensure on-the-ground training with respect to the differences.

Mr Cordiano: But there have been changes to the eligibility rules recently. Over the last several years, say, during the course of time that this government's been in office, eligibility rules have changed.

Dr Pascal: There have been some as part of Back on Track and the STEP change; there have been a few. If that's what you're requesting, perhaps Mr Stapleton could give you some examples.

Mr Cordiano: Yes. Would you please give us a review of that in general terms.

Mr Stapleton: In general terms, there's been a complete revamping of the eligibility review --

Interjection.

Mr Cordiano: With Mr Jackson talking, I couldn't quite hear what was being said.

Mr Jackson: I wish to apologize. The reason I was asking the question of clarification is that this question was asked yesterday and it's on the list to come before us. I simply wanted to know how much more time Mr Cordiano had. If he wants to use his last four minutes hearing something which is coming soon in printed form, that's fine; he has the right to do that. I was simply asking the Chair how much more time. If he had one minute left, I knew the deputant wouldn't, from the 150 recommendations of the SARC report, be able to give a complete answer to Mr Cordiano.

Mr Cordiano: Mr Chairman, I still have the floor, don't I? Can you please answer my question?

Mr Stapleton: As I understand your question, it is what are the changes we've made in the area of eligibility over the last few years and what we're actually telling our eligibility review officers through our manual amendments and that sort of thing. If that's a correct understanding of your query, we have made changes in the manual which reflect the new freedom of information and protection of privacy requirements.

We have made a lot of changes that made reference to old computer systems and now bring it up to date with our new computer systems. We've updated the whole overpayment recovery for non-recipients, which is something the committee has talked about at great length over the last two days, recovery of cases in regard to overpayments. Those areas have been updated and changed over the last year, but basically those amount to various different types of housekeeping changes and just keeping on top of current law and current events.

The real news in terms of our whole eligibility review system is that it's been completely revamped in the number of people and the number of referrals that are going to those people. Just going back to your earlier comment, if the comment of the caller was made in good faith, it's extremely understandable, both in the last recession and in this recession. The fact is that we have a statutory program that can grow by amounts, amounts which we do not know in advance. Certainly we did not expect, at the beginning of this recession, for the family benefits program to grow by 97%. As a result, we saw those unprecedented strains that tend to bring, as Mr Pascal has put it, people to the front counter of the program. So people who perform jobs that work on the program exits, like the parental support worker, like the eligibility review officer, simply cannot do their job in that environment.

Mr Cordiano: The point I am trying to make is that it has been the view of some people commenting, whether in the media or elsewhere, that eligibility requirements have been loosened and therefore that has led to an increase in all kinds of difficult situations, described before by many members and described by others as being some of the problems associated with the system at the present time.

I don't know. I'm just trying to get to the bottom of that in terms of perceptions that people hold, and if that's the case, then we would want to understand why that would lead to additional instances where people are being provided with more incentive to move forward in this area, or where you have groups of people who are systematically planning to break the system or to go around certain rules. Where are the loopholes, where are the holes that need to be filled, if it's in the eligibility area?

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Mr Stapleton: Certainly, one of the areas is the client information update reports and the basic eligibility when it's first done. We got a fairly clean bill of health in the basic eligibility, but in terms of client updates it's been the case over the last couple of years, with that unprecedented growth, that certain clients have not been seen. We've done our best to get back on top of that and I think you'll find that over the coming year, with the new staff and some moderation in case load growth, we'll be back on top of it again.

During that period, if some clients got the view that because they haven't been visited, haven't had an income maintenance officer contact them and there hasn't been follow-up on situations that don't look quite right, as Ms Fraser put it yesterday, there might be a sense on the part of certain elements in the clientele that, say, "Hey, I got away with that," or, "I haven't been seen in a couple of years," perhaps that would lead to a sense on some people's part that the program has been loosening, but that's exactly why we have put the new staff in place and why we're working to get on top of it. But it didn't work that well in a scenario where every new staff we added was taken up with the additional case load growth.

Mr Jackson: I wanted to comment briefly about Mr Callahan's line of questioning around UI. I make no apologies for the federal government and its decision. Perhaps it's a particular Liberal view of the world that if another level of government pays for it, somehow we're doing a responsible job. I frankly wanted to indicate that if we could all take one step back and look at the decision on UI, it is no different from the activity we're currently undertaking, which is, how do we prevent the growing number of citizens who are working for 21 weeks, then quitting their job and collecting unemployment insurance for a year? UI fraud was a significant problem in this country. The government maybe reacted harshly, but it reacted to the problem.

Our problem is that cases of sexual harassment in the workplace have a terrible record before our courts. To say that being able to go and get UI is an effective remedy for workplace harassment -- I reject that approach completely and believe that the matter should be dealt with, and dealt with harshly, and that the worker has the right to maintain the dignity of her work. Just for the record, I'm not about to throw stones at the federal government. I consider it an accountability issue of equal measure.

What I am concerned about is that we are accurately assessing the impact of those people who normally would fall into the first wave of UI, the second wave of GWA and then into family benefits. We are seeing clearly a cohort of clients who are going from a workplace experience to GWA and FBA. I think it would be somewhat helpful if you could share with this committee briefly if you've at all been able to quantify that. I have the figure that you gave Mr Callahan of $50 million to $70 million. Was that predominantly GWA, FBA or a combination? I'm sure it wasn't all FBA.

Ms Fraser: Perhaps I could deal with that question. The numbers the deputy mentioned were indeed, if I recall correctly, almost exclusively GWA since the individuals involved would normally touch the GWA system first. It would be during their period of eligibility for GWA where we would feel that increased cost as a result of those changes.

Mr Jackson: Following along with this, pursuing this deeper, GWA doesn't run indefinitely. In some circumstances, we encourage clients to move from GWA on to FBA at some point. Is that not correct?

Ms Fraser: It will depend on the individual client and whether that client has FBA eligibility.

Mr Jackson: Correct, but there is a trend that you have been able to discern, by analysing your stats, that after a period of time there is an effort to move to FBA because FBA stabilizes the payment for a greater duration, and there's a variety of reasons. I'm noticing some interest and I want your colleague to participate in the response here.

Mr Stapleton: The only point of clarification I would make is that the only people who really can move to the family benefits program are those who are single parents or those people who have a medical certification of permanent unemployability or disability or who have reached the age of 60 years. Otherwise, someone could stay on general welfare assistance and there wouldn't be any particular time limit on that, although the usual period of time for, say, a single person is in the order of four to six months.

Mr Jackson: Perhaps I wasn't clear. If a family moves from a situation of employment, where they've quit their job -- husband and wife and kids -- they go to GWA right away. After a time, if they're not coping, there may be, for a variety of factors, a separation, and now it's in the best interests of the mother-led, single-parent family to pursue FBA. We don't have as many women in the workforce who are moving directly from quitting their jobs and then going on FBA. That is not the trend that I've discerned when I examine these stats.

All I'm saying to you is that we're going to see an increased activity in the transfer over to FBA, marginally, but we're looking at $50 million to $70 million as the increase in this fiscal year of new client loads that might have been on UI for a year.

Ms Fraser: In the fiscal year, starting in April.

Mr Jackson: Okay. So you're anticipating $50 million to $70 million. I want to get to the point of this figure of 4% that's floating around this week, the 4% increase in your costs for FBA and GWA. Is there concurrence that's the figure you're floating as a government right at the moment?

Dr Pascal: At this particular point.

Mr Jackson: You're projecting potentially 4%.

Dr Pascal: Yes.

Mr Jackson: Can you assist this committee in determining how you get our base figure? Then we can figure out 4%. But 4% on $6.2 billion is about $250 million. Is that about a rough estimate? Fine. We've been given a lot of figures that show -- follow me here -- you've got a $250 million projected increase in your total payments to this program.

Now I ask you, how do we get a $300-million saving? Does that mean that it's actually going to go up by the $300 million in savings plus the $250 million? Are you following what my concerns are? You're telling me that you've picked up an additional $50 million to $70 million worth of new clients. Is that where the increased costs are going to be broken down? I'm having difficulty understanding how your 4% increased projection is arrived at. That will help this committee unlock some of the mysteries around where your savings are to the issues raised by the auditor.

Mr Stapleton: Basically, the $300 million, as I understand it, is against forecasts and against plans for what we would have otherwise seen. To look at that mathematically, if we have a $6.2-billion program this year, at some earlier point in time, prior to May 6 last year, we were looking at an increase that would have gone in the $6.7-billion or $6.8-billion range, but then the $300 million would be against that.

Mr Jackson: I'm not sure I understood that. In simple math, $300 million is about 5%. Are you talking about a true 9% increase in expenditure with a 5% reduction in there to net you out at 4% -- that's what I'm trying to get a handle on -- or are we talking about a net increase of 9%, so your true expenditure increase is 9%? I'm just trying to understand which is the figure we're supposed to work with.

Dr Pascal: I think I understand the question. What Mr Stapleton has just said is that when the $6.2-billion projection was put into the estimates, that took into account what otherwise would have been a $6.5-billion projection as a result of these interventions.

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Mr Jackson: Let me reverse the question then, because you're talking of this fiscal year and the 4% is what you're projecting.

Dr Pascal: Correct.

Mr Jackson: Let's stay with one year. You pick the year and let's stay with it. I want to talk about next year, which is starting April 1, 1993. Those are deemed the 1993-94 estimates. Your Treasurer and your minister have already floated a figure. They anticipate welfare costs for this government to go up by 4%. I simply want to know what is your base number as you exit this fiscal year.

Dr Pascal: It's $6.2 billion.

Mr Jackson: You're going to exit at $6.2 billion and you're saying you're only going to increase your expenditures by 4%.

Dr Pascal: That's the projection. If we take two years, one at a time, we entered last year at a $6.5-billion projection and a $300-million intervention to cost-avoid, which we've been discussing for a couple of days. Exiting this year, we hope the $6.2 billion will be on target, including the $300-million cost avoidance, and on that $6.2-billion base, we're projecting a 4% increase.

Mr Jackson: I understand that now. Thank you. What is your projected saving for 1993-94, since you're already able to estimate your gross expenditures in the coming year? What do you estimate to be your savings in the coming year?

Dr Pascal: Taking some of the interventions we're talking about now?

Mr Jackson: Correct.

Mr Stapleton: We don't have an exact figure. We're going to have to assess the $300 million at the end of this year and see exactly what the amount is going to be next year.

Dr Pascal: The hesitation is that I'm making the assumption. I can clarify tomorrow morning or validate what I'm about to say. In terms of the advice we get from our financial people, my assumption is that if the projection is a 4% increase to $6.2 billion, the kinds of interventions and cost-avoidance we hope to achieve this year are rolled in and taken into account in terms of that $6.2 billion plus the 4% increase. I have to assume that's all built in. Otherwise, as you well know, the 4% isn't 4%; it's less than 4%, if that hasn't been taken into account.

Mr Jackson: I need help with that. If I may, Mr Chairman, there were several questions Dr Pascal returned today. He indicated there were 15. It's of limited comfort to me that five of my six questions didn't make your list today.

Dr Pascal: There was no malicious intent.

Mr Jackson: What was even more significant is that two of my questions didn't even make your list. So I'd like to go over those if I could.

Dr Pascal: I apologize for that.

Mr Jackson: That's okay. They were all thrown at you at a very late hour, but it's important that I get on the record now and not tomorrow night what I'd requested, which I thought we'd forgot.

I specifically identified three major policy initiatives which made welfare more permissive in Ontario. You addressed two of those, the lack of home visits and the non-residency. I also asked for the impact of student welfare or what people call walk-in welfare or over-the-counter welfare. I'll come back to that. You did give me statistics elsewhere which told me a lot about that.

The second question I had was with respect to what new statistics you are now keeping. Again, the auditor said you're not keeping statistics. When we as a public accounts committee say, "Can you give us these numbers?" you say, "We don't keep them." So I specifically asked you what are the new statistics you are now keeping as a management tool so that you can satisfy the auditor, this committee, your Treasurer, anybody. I needed to know which new statistical base you're measuring. I put a caveat on there. I also asked you what trends you have been able to discern as a result of now examining those statistics. You have periodically referenced them. I just wanted you to amalgam them and present them to us if you could.

Third, it wasn't on my list, but if you could, the name of this collection agency which your staffers had indicated. If you could just check with that staffer who gave you the advice about calling a collection agency to know who was only giving 3% of the recoverables back, that would be helpful if you could give us that. I know we're going to get inundated with phone calls, because every agency is going to change its collection rates because they saw on TV that 97% they keep and 3% they give back to the person.

Dr Pascal: Just by way of response, first of all, my assumption yesterday, and I will check my own notes, but I thought the issue on the students was something you just tabled that you wanted to discuss. We didn't put it on the information request because that's not the way we heard it.

With respect to the MIS, management information system, that's an information request you're making right now. Number 13 is the question we thought captured that, "What new information is collected?" We would include in that response, I think, your reiteration.

With respect to the collection agency to which I referred, Mr Chair, I must say I'm very uncomfortable with that request, because, first of all, the request was made of a staffer very informally. The person who was phoned was under the clear impression it was not for public discussion. I can assure you, as I will testify right now and in the future, that I know the call was made and it was made in that particular context. I just think it would be unfair to the individual call to have that become part of the public domain.

Mr Jackson: Then with equal diligence and more clarity and direction, maybe you can ask the same staffer to call two agencies that would be more than pleased to go on the record and that staffer could enlighten this committee with, say, two collection agencies and their rates if they were given the assignment.

The Chair: Order.

Mr Jackson: Is my time up? That would be helpful and appreciated.

The Chair: Mr Hope, 15 minutes.

Mr Hope: I'm still stuck on this UI stuff, because I believe the changes, contrary to what Mr Jackson says, to Bill C-21 were draconian, were affective to people. You're talking about increasing staff, you're talking about doing better assessments on people coming in the door, making sure we comply with the auditor's report and his findings.

One of the areas which I found is very hard for a lot of people, and it's not because they're doing it intentionally, it's a lack of knowledge -- those who understand Bill C-21 will understand the regional unemployment rate aspect. Every four weeks a new regional unemployment rate comes out and you may be short one day, you may be short three days, you may be short a week. You may not qualify as you went through the door of the unemployment insurance office.

I know that most of the time they go to welfare, but what about those individuals who are the single-parent moms and can access FBA right away? We have a lot of single parents working out in the workforce today who may qualify.

In your conversations you're having to make sure we get our money back or the money is returned back to the coffers, are you even in discussions about how UI is going to help you to assist in making sure those individuals might qualify down the road? Each four weeks, people are receiving notices that they may qualify if they've worked their extra day or extra week in that four-week time period. They may now qualify for unemployment insurance. I'm just wondering, in the conversations you're having with the federal government, are you talking about the regional rating system too?

We're talking about putting more staff in place. I have some more questions I want to deal with on staff. I'm just throwing this out. If you don't have an answer, I understand, but I'm just wondering about those conversations, because we're talking about putting more staff on to comply with an auditor's report and I'm wondering if the actions that are being taken by the federal government are not causing us more problems in that sense.

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Mr Stapleton: Certainly the people we have talked to about the assignment system and putting the assignment system in place don't make the rules and they don't make any of the rules that relate to what happened with C-21, either in the sense of the number of weeks being eroded or the amount of time that one has to spend working before one gets on the program in the first instance.

Certainly that has continued to have been one of the really major stories of this current recession and the social assistance case loads that we've seen. Really, the assignment system itself will end up with more money coming back to us simply because people will not receive money for the same time period. I can say that that happens in two ways: both through the assignment system and through the fact that the time period of overlap has been reduced over the past time, but I suppose that's a long way of saying there's a different set of votes.

Mr Hope: I just wanted to lay that on your lap as I listened to the conversations that have been taking place about recoveries. I'm saying I have prime examples in my own constituency where people are dedicated and have worked 25 years and put all kinds of money in unemployment insurance and then all of a sudden -- some may have been laid off for a little bit and then went on to unemployment insurance and went back to work -- when they went to recalculate, they were three days short or a week short in receiving unemployment insurance.

I know that happens and, like I said, there are a lot of single parents out there in the workforce and it could happen where they're affected. I'm wondering how the cooperation will be with the federal government on that issue of the regional rating system and every four weeks the weeks may change depending on the unemployment rate -- the qualification weeks will change.

The other area, and I've learned a lot about savings that you're doing in order to help the issue we face with the recession that's here -- I come from an agricultural community, so I say the "silos" of savings that are there. If I look at the silos of savings on eligibility, you're making improvements in that area, complying with the auditor's report, making savings about CPP and making sure that people who are entitled to programs are getting access to those programs through the assistance of increased staff.

If I look at the savings that you're providing just on the direct deposit, for instance, you're talking about where you have to reproduce cheques of $1.5 billion. If I looked at it in a silo, you've got savings there. Then I look at the cost of staff that you're talking about. Since there's been so much conversation about fraud and the recovery aspect, can you explain to me -- I'm understanding those other areas -- clearly the process the ministry is taking to pursue the overpayment aspects? I've got some ideas, but I want a clear definition of how you're trying to stop, whether it's computer error or whatever error, the overpayment aspects to people.

Mr Stapleton: I can certainly start off. One of the items that was in the minister's announcement last May 6 was the fact that we were looking into a project of looking at monthly reporting on the family benefits program. Members may be aware that in the family benefits program we have earnings averaging, which means that a client's earnings can be looked at over a period of months. When earnings are looked at over a period of months, what this could mean is that the earnings can fluctuate, and at the reconciliation period, then we would have what we would call system-made overpayment.

In a couple of areas in the province, both in the southwest region and in the Sault Ste Marie office in the north, we've looked into the monthly reporting so that clients would be able to reduce the number and level of overpayments that were caused by fluctuations in earnings. This may seem like a small aspect, but it's a very important point for recipients who go back into the workforce and then find after a couple of months that they've massed an overpayment that they themselves actually don't know anything about. It has absolutely nothing to do with fraud or any manipulation or even any administrative error.

What we also found from the focus groups of clients that were conducted during the deliberations that the Moscovitch committee went through is that many clients were telling us, and I would say candidly, somewhat to our surprise, that they would appreciate a system where they reported a little more often as opposed to less often simply for the fact of not incurring the overpayment. I'll defer to my colleagues, but that's certainly one area that we're looking at very closely and feel has a lot of promise.

Dr Pascal: The only thing I would add for the moment to what I think is a very important line of questioning is that it's not just staff and it's not just the presence of larger numbers of staff. There were questions earlier this morning about worry about adding to the province's load in terms of the Ontario public service; on the other hand, it is employment. But it's systems design, it's better accountability structures and it's technology. All those things have to be part of it. We can't just keep adding staff as part of the interventions.

With each of the subcategories of overpayment, Mr Hope, I think we're making some progress. Again, we appreciate the kind of reinforcement and, if you will, leadership provided by the Provincial Auditor in calling attention to the depth and breadth of some of our problems. We're fortunate that the treasury board of the provincial government gave us an $18-million investment at the right time so that we are here today with better news than we might otherwise be, because the system was under siege in terms of load and, as others have pointed out, vulnerabilities around administration and implementation of policy have been very much a problem.

Mr Iannuzziello: One of the points that was made in the auditor's report was the fact that we were behind in our annual reports that we had to complete on people who were in receipt of social assistance. Since we've had the additional staff on board, up to this point we have completed 10,000 more client contacts than we had last year, which would update circumstances so that we should reduce the number of overpayments that are created.

Mr Hope: Dr Pascal, I was listening earlier to some of the line of questioning when it was talked about the Provincial Auditor coming back in. I just want some clarification for my own reasons, because I was looking at an editorial that was supplied in information from our legislative research dealing with social services. I'll just give you a synopsis.

They were talking about the transfer payments and everything else. It says that most of the problems were "particularly when some of the transfers were driven by irresponsible provincial spending increases in the 1980s." This was a news article saying that we are irresponsible in our spending and that's why the federal government put the cap on CAP, because of bad provincial government in the early 1980s and late 1980s. This is what this editorial says.

It's important and I think you brought it out, but I just want clarification for myself. Are you saying you're welcoming the Provincial Auditor to come back in, say, a year to make sure we're pursuing the issues the auditor has raised, to come back and do a reassessment to see if we're on track, if we're not wasting taxpayers' dollars? Am I clear on the assumption?

Dr Pascal: Mr Callahan proposed this morning -- I'll leave it to Hansard to give a full report on what I thought I heard. There were areas that were serious enough that, given the nature of this program, he offered a suggestion to the committee and to the Provincial Auditor that, because of the magnitude and concern, public interest, they return.

I simply said that if that were the decision of the Provincial Auditor, I would welcome that. I'm not asking for it. We think we have the controls in place. My performance objectives clearly reinforce the importance of ensuring the kind of integrity that the taxpayers of Ontario and those in the system want and deserve. But I would welcome anything we can do to ensure increased accountability and consistency of administration in these areas. I simply was responding to Mr Callahan's suggestion that if others decided that would be, we would not find it an inconvenience.

We did not find the process with the Provincial Auditor this past year anything other than extremely constructive and helpful. It was not mischievous. It wasn't, "Oh, here comes the Provincial Auditor." As a deputy minister, it is absolutely essential to my way of doing business, or any other deputy minister's way of doing business, that a rigorous, arm's-length review of something as important as this program is extremely helpful. So it was only in that context that I said if others decided that's something they wanted to do, that's fine. I hope it won't be necessary, but if others decided that would be politically or fiscally responsible to do, then so be it, and we will be as cooperative with that process as we think we have been this past year.

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Mr Hope: Why I pulled a section of that --

The Acting Chair (Mr Duignan): Very briefly.

Mr Hope: Briefly? I just started. Let me briefly say, then, that I brought that comment out because it talks about the irresponsible governments in the 1980s. That was in the Financial Post of May 27, 1992. I take it most people read the Financial Post. Some would take that as gospel. That just tells us there was irresponsible provincial government in the early 1980s. I thought I'd bring it out for reference. I hope we're responsible enough to be accountable to the public.

The Acting Chair: Have you got a quick reply?

Dr Pascal: Only that I do not want to enter the large-p political fray. I simply want to say --

Mr Callahan: I'm glad you recognized it for what it was.

Dr Pascal: I recognize that. I enjoy my status and appreciate the courage required for others to run for office.

I simply want to say that in the early 1980s I was the president of a college in the public domain. I suppose the only legitimate PhD I have is one in hindsight. These are times that are different from the 1980s and there are some things we're doing now that we should have done then, that I should have done as a college president but didn't, that if I were one now, would be doing.

Again, we're appreciative that some of the upside of the fiscal challenges we face has to do with better accountability, better systems that should have been in place years ago.

The Acting Chair: Mr Callahan, you've got 15 minutes.

Mr Callahan: I want to go into a few items. You can indicate that I'm asking you something about policy, if I am. We all know there was no increase, or an increase has been delayed until April 1, I think, for recipients of social assistance. That's unusual. As I understand it -- I've been here since 1985 -- it's been usual that the announcement has been made earlier on, I guess to allow parents to deal with and budget any increases. I recognize that you must have had to go to treasury board and ask for the $18 million you've indicated for the additional 450 workers in order to rectify the concerns the auditor has addressed in his report. I'd like to know the timing of the request for the $18 million. Was it made before or after you'd been audited?

Dr Pascal: It was made after the audit process had started. But the only addendum I would add is that requests for additional staff has been ongoing. That wasn't the first time additional staff for these types of issues had been requested. But at the time we were successful, in terms of this last round, the provincial audit process had begun. So the answer is, after the process had begun.

Mr Callahan: In fact, requests that had been made prior to this had been unheeded, but when it became apparent that the auditor was buttressing your own concerns that you didn't have adequate staff, the money did come forward.

Dr Pascal: I think it's fair to say that in a time of extraordinary fiscal constraint, when governments are trying to keep a lid on their own expenditures, as is the wont of the people of Ontario and the government itself and members of opposition parties, when individual ministries come forth with requests for additional staff in that environment, it's always helpful if there is research --

Mr Callahan: Some trouble on the horizon.

Dr Pascal: No, no, no. I'm sorry. I do not in any way want to characterize the treasury board's response as, "Let's avoid some trouble with the people of Ontario in terms of the Provincial Auditor's report." What I'm trying to say is that having an informal report that reinforced, through an independent and credible process such as the provincial auditing process, was something that wasn't unhelpful. But I participated in the meetings of the treasury board, and it was simply a matter of pressing the case for all the right reasons: to increase the integrity in the system.

Mr Callahan: I won't continue the water torture, but it could be simply said that it was fortuitous that the auditor made these findings, because it did in fact -- I'm not saying this in any partisan way. I think governments always require spurring on by something that happens so they can give in to something they probably should have given in to earlier. That's why I'm so concerned about this central collection agency we have here in the government. If their problem is underfunding, we had better take a look at it and maybe we can create something fortuitous for them too, where the treasury board will provide it with additional funding if it requires it.

But the thing that does concern me is the fact that, as a civilized and a sensitive society, we have pushed the message to the public about such things as drunk driving, which is admirable, we've pushed it about wife assault, which is admirable, but I've yet to see any ads by any government, of whatever political stripe, that say, "If you cheat the system or you take more than you're entitled to, you're going to deprive some other person who has equal need of receipt of funds," and are also going to deprive, as happened in this case -- the 1% or the 2% or the increase to social assistance recipients has been delayed until April 1; that means they go over the winter without that additional assistance.

I think most caring Canadians are prepared to see their tax dollars paid out to assist those people who are truly in need. There should be a campaign, just as there is with drunk driving and with wife assault and all the rest of it. In the final analysis -- and maybe some people hearing this will think I'm stretching the message -- it really is child abuse and wife assault. If there's not enough money in the house either because they haven't got the increase or they haven't been able to get through the increased and stepped-up efforts that are going to have to be obtained because of the pressures on the system, these people actually suffer and the kids perhaps don't get what they should get. I think that's as deserving of education through advertising as these other good things, like against drunk driving and wife assault and child abuse.

I think it's important that governments not forget that. This is not a handout for anyone who can play the rules; it's a handout for people who are in a tough spot. We're trying to help them out for the time being. That's what's so important to me, that the integrity of this system has got to be maintained. I really will be looking forward to an audit. I for one will be asking the auditor to do a full audit along the same lines next year to ensure that we see how you're doing in terms of the technology. I think technology is the key.

I'm sure with the LCBO, fines can be collected. I don't think anybody doesn't pay his or her fines, because they don't get their licence plates; they lose their wheels. There's got to be a technique, as Mrs Marland has said, of linking all of this in with a social insurance number so you can trace these people and make certain that when they come back into the system, if they haven't paid, then you can do what you're doing. I think taking 5% back from them is fair, or maybe even less, depending on their circumstances.

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But we can't just forget them, and that's what I get from this report, that in some cases they were just ignored. You've accepted the fact that that's unacceptable, and I'm glad to hear you do, but we've got to see that doesn't happen again. I think the only way to do that is for us to perhaps be a thorn on the horizon for you people, and you're going to be a thorn on the horizon for those people out there in the field to ensure that they carry out this function.

Finally, it strikes me that people should be required to update the information themselves. That would save people going out and having to update it themselves. As much as I've harangued UI this afternoon, you are required under UI to send in a card if you've earned anything and so on. They do spot checks, and every now and then they catch somebody who's cheating the system. I'm not sure that is done in the case of social assistance. As I understand it, what happens is that a worker goes out and updates the information from time to time, usually triggered by a request from the recipient or from one of our offices or whatever. I don't think that system is really all that helpful.

The other thing I would say, and maybe I sound like a right-wing Tory saying this --

The Vice-Chair: If I could interrupt, do you want an answer to that, Mr Callahan?

Mr Callahan: I'll get an answer in a second. I'm sure they will answer it shortly.

The Vice-Chair: We are running out of time for today.

Mr Callahan: How much more time have I got?

The Vice-Chair: I'm going to allocate another two minutes, and then I'm going to turn to Mrs Marland for some concluding questions, and then I think we're going to call it a day.

Mr Callahan: One other thing I would throw out for your assistance, and I've always advocated it, is that if people are required to sign a statement under oath that they are entitled to the benefits they're claiming -- some people say that's being a little too strict with people. The importance of an oath or the sanctity of it will mean something to maybe 50% of them; it may not mean anything to the other 50%. But you're going to get people giving you more significant answers, and it might limit the number of people you have to send out to check on them. It also gives you the opportunity that, if these people have sworn the oath improperly, if they've lied, you've got definitive evidence that fraud has taken place.

Finally, and this is really getting right-wing, but I feel so strongly about maintaining the integrity of this system, in the United States, as I recall, they've got what they call almost bounty hunters. If someone in the system believes that somebody's cheating the system and they turn them in, they get a reward. I hate to say that maybe we have reached the stage. That's a little caustic, but maybe we've reached the stage. We do it with Crime Stoppers, we do it with a whole host of things, and I think that's how 90% of Revenue Canada's investigations take place: You're standing in the yard talking to your neighbour and you're telling your neighbour, "I got away with all sorts of things," and the next thing you know, you're being audited by Revenue Canada. But money is so tight that maybe we have to resort to some of those programs to maintain the integrity of the system.

The Vice-Chair: We're going to move on to the next set of questions. I'm sorry we ran out of time, but we're going to move on to Mrs Marland. She's on the list. We have a few minutes left and we're going to move on.

Mr Hope: I would be interested to hear what the ministry has to say about the posse aspect he's taking about.

The Vice-Chair: I'm sorry. We are running out of time, so I'm going to move on to Mrs Marland's questions.

Mrs Marland: Mr Jackson has one question first.

The Vice-Chair: Okay; Mr Jackson.

Mr Jackson: In the last rotation I was pursuing some concerns I had about the impact of several substantive changes in procedures for your ministry in terms of eligibility. I discussed the lack of a permanent residence, no longer requiring a home visit, and I mentioned the increased eligibilities for student welfare, or "walk-in welfare" as some people call it, or "over-the-counter welfare," as some people have even called it.

You answered, in part, on question 4 in your handout today. Could we address that very briefly? According to your statistics, in the city of Toronto in July 1991 there were 3,167 homeless people collecting GWA. Then you go on to show that in December 1992 the figure was 1,775. You basically indicate that these fluctuations are not significant. Perhaps it's because I chair several food banks in my community and we're constantly monitoring our client load and our shifts in clients, but we see a substantive increase in the number of students, 17-, 18- and 19-year-olds, collecting social assistance and presenting themselves at food banks during the summer months and not in the winter. I see something else in these statistics, but I really wanted to get a clearer window on the number of students or young people who are obtaining welfare more readily. I have a case example I want to share with you which is very disturbing, but it's a growing incidence and I was hoping you would be able to identify some numbers for this committee. These ones are fine, even though you interpret them differently than I do.

Ms Fraser: I wonder if I might be able to respond, Mr Jackson. The material to which you are referring deals with the question you tabled yesterday with respect to the changes of rules around homeless applicants --

Mr Jackson: Absolutely.

Ms Fraser: -- and it was in that intent that we provided that information to you. I believe the issue you are addressing at the moment has to do with the eligibility of young people for welfare.

Mr Jackson: If I can interrupt you, when I asked the minister the question around this, both in estimates and on the floor of the Legislature, what we established was that it is sufficient for a 17-year-old student in Ontario not to verify where he was living as much as it was to verify that he was no longer living with his parent. That's a very significant question to ask a client, because the problem with student welfare is you have students who are saying: "I can't get along with my parents at home. I'm not living at home."

Therefore, there would very clearly be, not the requirement to establish another residence but simply to establish that the residence was no longer acceptable to a student, who is then eligible for welfare. That is what the minister has explained to me in estimates, and I've seen your procedural manuals around this. I know you've answered the one question, but contained in this statistic of homeless people are young people who do not show a residence. Would you not agree with that?

Ms Fraser: I would agree with you that contained in that statistic would be people of all ages eligible for general welfare, so some of them may indeed be of the ages of 16 to 17. That is possible.

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Mr Jackson: Yes, and what I was sharing with you is that we're servicing over 2,000 individuals in the community of Burlington on the four food banks that operate under the coalition I chair. We're keeping statistics by age, by mobility and by whether or not they are social assistance clients. We keep extensive statistics. We don't put names associated with them; we protect their privacy. But it's very important to us to be able to talk to our community about who the typical client is.

All I'm saying is that we see a large increase of homeless, young people during the summer months who are collecting welfare of some form and who are presenting themselves at food banks, and then we see that number diminish during the cold winter months. That's what I'm observing as a community worker dealing with a lot of FBA and GWA recipients in my constituency.

I'm seeing this statistic now which, by your own admission, can include, because it's not age-specific -- and that's why I was asking you what the impact on student welfare was. Are you keeping statistics by age? Can you break out your client load by age to say, "Here has been an increase by age of these individuals"?

Ms Fraser: The numbers we provided to you, Mr Jackson, were from Metro Toronto, and I can certainly follow up with them to see if we can get that broken down by age. I believe we can, and if that would be helpful, we'll certainly be delighted.

Mr Jackson: Okay. I think that would be more helpful.

Ms Fraser: Certainly.

Mr Jackson: I wanted to share with you that I'm rather disturbed by these kinds of numbers, and I would suspect that what I'm experiencing in my community we're experiencing elsewhere. I'll just share with you briefly the case and then I'll yield to Mrs Marland.

The teachers' federations and school boards have expressed growing concern about the increased practice of students who merely establish that they can no longer get along at home and therefore have to move out and therefore are eligible to attend a high school and collect welfare.

The case that came to my mind in my own community is of a 17-year-old boy who has now moved in with his 18-year-old girlfriend and her family and is not necessarily paying rent to that family, but what is the big joke in the school is that so-and-so has all this mad money to spend on his girlfriend and they're domiciled together. This is a great embarrassment and frustration to the family who have lost the child living under their roof and it's of great concern to the guidance counsellors who approached me because of the increased number of requests, "How do I get on student welfare?"

When you get a class where there are two or three students on student welfare -- and Dr Pascal, you have an extensive background in schools, you know how these things happen -- these are matters of concern and I was wondering -- there's an example of a change in policy which has improved access -- to what extent are we monitoring that?

I know I'm straying into a policy area, but I think this committee would like to know to what extent the impact of those policy sessions have been.

Mr Hope: That's false. Check into it further. It's false. Check into it further.

Mrs Marland: He's saying what you're saying is false.

The Vice-Chair: Order, please.

Mr Jackson: Are you calling the teachers who told me liars?

The Vice-Chair: Order, please.

Mr Hope: If you call these general guidance counsellors and talk about it --

The Vice-Chair: Mr Hope, order, please.

Mr Hope: -- you understand that a lot of rumours circulate around schools and half the issues that you just brought forward, labelling students as all welfare recipients, are wrong.

The Vice-Chair: Mr Hope, you do not have the floor.

Interjection.

Mr Hope: It's an access program for people to access welfare.

The Vice-Chair: Mr Jackson, you have the floor and you have two minutes left, and if you'd like a response to that question, two minutes in total left.

Mr Jackson: I am satisfied. He said he'd get some statistics and I want to yield to Margaret.

The Vice-Chair: Mrs Marland, you have two minutes left.

Mrs Marland: I guess I'm going to have to continue at another time, but I will ask one question at this point.

I have received some calls this week from former employees, and that's inevitable, talking about welfare fraud. I guess the reason I keep coming back to this subject is that there is such a major need in legitimate cases, and because of the recession we're in now, we're almost causing an expansion of the need by the fact that through other forms of taxation people are getting into more and more financial difficulty in this province.

While, on the one hand, we have these legitimate needs for welfare assistance, it becomes a revolving circle because we just don't have enough money to support -- by your own figures, Dr Pascal, you said, I think, it's a 69% increase over last year in the one category. When you look at those kinds of increases, the government has to get the money from somewhere. If the government is not able to prioritize in terms of human need and starts cutting back other programs to support this program by necessity, then I think there's a responsibility at the end of this for all of us to do something where some remedial measure can be successful.

I'm happy that you've agreed with our concerns and have said that you're not happy with the situation as it exists. When I get calls from former staffers who have worked with the general welfare assistance clients who say there is fraud, then you know they don't have an axe to grind. They're simply reinforcing what we've been saying.

I am encouraged by your responses to our concern and I must say I'm very impressed. I'm not surprised that you have been given the difficult deputy minister position in what I think has to be the most challenging of any of the government ministries. You've obviously been given that position because you're very capable, and I'm very impressed with the answers to our questions and how you have been dealing with this subject this week.

The Chair: I hate to cut you off, but we --

Mrs Marland: I want to ask this one question very quickly, because it may be something the staff may be able to look into overnight. I know someone who is currently employed with the clients of the GWA, the general welfare assistance, and this person tells me that we have in the system at the moment in the greater Toronto area facts that support -- it's very hard to say this, but is it true that we are supporting on welfare in Ontario the spouse and children of a Somalian warlord? I'm asking that question because if the rumour is out there, it needs to be killed if it isn't true. I understand that in this building where this particular person -- you haven't heard this rumour?

Dr Pascal: Well, other than what we've read in the newspapers --

Mrs Marland: Okay. To be honest, I didn't read it in the newspaper, but if it's been in the newspaper then obviously it's not something that's a hidden secret. But I understand that in this particular building, which I have been invited to tour but have not toured yet, something like 99% of the people are all on some kind of government assistance, whether it's family benefits or general welfare, but also that the garage in this building is full of BMW and Mercedes cars. When you're told something like that, it probably means that there are a few expensive, late-model cars in the garage of this building.

This is the kind of thing that, if it exists and people see it -- those are the questions I think you have an opportunity to answer on the record. If it is all rumour, it does need to be stopped. If it is fact, then the public is entitled to an explanation about what is being done. That's the importance of my question today.

Dr Pascal: Just briefly, obviously it's always important for us to do everything we can to separate out impression from reality. Where there are patterns that are disturbing we need to identify and act. The case you referred to, to which I responded with a reference to seeing an article in a newspaper, is in fact under investigation. I don't have the details with respect to where it's at. I couldn't agree more that there are some symbolic things that take place that are real and that put a cloud over the entire program. We need to ensure that as we pursue problems of breach of integrity, we do so in a way that we don't overreact to allegations that it's spread beyond what it might be.

When we see newspaper articles about someone earning $52,000 on the supports to employment program -- mathematically, it's actually possible, because of the number of children, their ages and how many are in child care; the number would probably have to be about six, seven or eight -- symbolically, there's a cloud that's cast over a very important program. So there's always a judgement that elected officials have to bring to bear to decide what kind of intervention is wise in terms of the original intent of a program.

In the case of STEP, as you and others know, the minister and her cabinet responded with an intervention which kept people of certain incomes from moving on to the system. It was not just cost-avoidance of $60 million, which was part of that. Again, it was also dealing with symbols that called attention to a program whose objectives were certainly not in line with what the BMW implies.

I think it's really important for us not to do anything other than look at patterns of behaviour and incidence, and follow up and be seen to be following up to protect the integrity, as you have said, for those who need equitable access to benefits they deserve. I think that's the important point you've reinforced, which is important for us all to keep in mind.

Mrs Marland: Would you be able to report to us tomorrow on the investigation that's ongoing with the allegation about the Somalian warlord?

Dr Pascal: I will do everything I can to give you a sense of where it's at in the process. By definition, an investigation is something that has to take place away from public tables, but I'd be very pleased to let you know what I've learned. I think you and I have the same knowledge base with respect to the case.

The Chair: I saw the same program Mrs Marland was referring to and I was appalled. If there's any truth to that, it certainly is something we should be looking at. To have someone in another part of the world starving innocent people and having thousands of defenceless children who cannot feed and look after themselves die for the sake of dividing up whatever power structure is there, and then having one of his spouses here living off the hard-working taxpayers of this province is probably a little more than most people could take.

Time has expired for today. The committee will resume tomorrow morning at 10 am.

Mr Hope: You should thank your colleagues for chairing.

The Chair: I thank Mr Duignan. I thank Mr Cordiano, the Vice-Chair. Who else helped out today? I thank Mr Callahan. Tomorrow, I'm going to thank Mr Farnan, because I know he's going to want to help.

The committee adjourned at 1634.