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Speech in Senate Chamber: Inquiry—Statutory Powers of Auditor General—Debate Adjourned



Statutory Powers of Auditor General

Inquiry—Debate Adjourned

Hon. Anne C. Cools rose pursuant to notice of June 3, 2015:

That she will call the attention of the Senate to:

(a) the statutory officer the Auditor General of Canada, and to the Auditor General Act, in which parliament wilfully granted him no powers to subject or compel senators or members of parliament, to audit examination; and, to this Act's Powers and Duties sections 5-12, and section 5 that commands:

The Auditor General is the auditor of the accounts of Canada, . . .

and,

(b) to the constitutional truth that the Senate is no part of the accounts of Canada, nor of the public administration, nor of the public service; and, to the constitutional fact that this parliament's upper house the Senate, like the Commons House, is not a department of government headed and directed by a government minister of the crown; and, to the Auditor General Act's section 7 that commands the Auditor General to report to the Commons House on his Public Accounts audits, but which Act has no section that authorizes this auditor to report to the Senate on anything, and most particularly not on an audit examination of senators, largely because this Act grants no power to report on that which it grants no power to do, and in fact forbids; and, to the critical fact that the Auditor General Act is subject to the abiding law of the constitution, known as the " sovereignty of parliament," which he is sworn to uphold; and,

(c) to the constitutional fact that the auditor general's audit of the Senate and senators is no part of the data or information he requires "to the fulfillment of his or her responsibilities" as the auditor of the accounts of Canada, pursuant to the Auditor General Act section 13.(1), 14.(1) and 14.(2); and, to the fact that senators and the Senate are not subject to his Act's section 13. (4) which grants him powers as a commissioner under the Inquiries Act, Part I, because the Senate, is "no part of the accounts of Canada," nor of the public service, nor of the public administration; and,

(d) to the 1987 Federal Court of Appeal ruling, against the Auditor General in his quest for access to cabinet documents in the Petrofina case, wherein Justice Pratte, concurring with the lead Justice Heald, held that the Auditor General is the "auditor of the accounts of Canada" and, "whatever be his rights under ss. 13 and 14, he may only exercise them in fulfilling his responsibility as auditor of the accounts of Canada," and, to the constitutional fact that audit of the senators is no part of the Auditor General's rights, powers, nor "the fulfillment of his or her responsibilities" by the Auditor General Act.

She said: Honourable senators, I rise today to speak to my inquiry on the Auditor General.

Honourable colleagues, the Auditor General with his duty to report to the House of Commons was constituted by statute to assist that house's pre-eminence in its unique role to hold government ministers responsible to the Commons for the national finance, the public revenue and expenditure, in taxing and spending. This Commons role is actuated by the power of its fatal confidence votes that compel government defeats, resignations, dissolutions, general elections and new governments. This mighty power to make and unmake governments swiftly and without bloodshed is at the heart of the British Westminster governance system. It is known as the Commons "power of the public purse."

Honourable senators, the Auditor General's audit examination of the Senate, the upper, the royal, and the federal house of Parliament, poses large constitutional questions. Is this Senate audit consistent with Canada's Constitution? Is it consistent with our 1878 enacted statutory role of the independent Auditor General, constituted to do appropriation audits of the Public Accounts?

Created by this statute, this officer was to verify to the House of Commons by his audit examination that their appropriation purposes prevailed and that the government spent public monies as the Commons had voted in their appropriation and supply acts, some of which were adopted here earlier as is the practice in June. By the Constitution Act, 1867, sections 53 and 54, these appropriation and supply bills must begin in the House of Commons and may be moved only by a Crown minister, no backbenchers allowed.

Honourable senators, the 1878 statute was titled An Act to provide for the better Auditing of the Public Accounts. This statutory officer's sole constitutional purpose was to audit examine the public accounts and to aid the House of Commons' pre-eminence in the national finance and its power in the "control of the public purse."

Honourable senators, in ministerial responsible government, this power is actuated as denials of supply, confidence votes and impeachments. This House of Commons power is also shown in the parliamentary fact that the lower house, the Commons, chooses Canada's government and Prime Minister, who are then appointed by the Governor General. The Prime Minister is that member who holds the confidence of the house, meaning the support of the majority.

This public purse pre-eminence is founded in history, and it is described in the concepts known as "taxation by representation," "representation by population," "no taxation without representation" and "the financial initiatives of the Crown," meaning originating in the House of Commons.

Honourable senators, the Auditor General's recent Senate audit is inconsistent with our Constitution and with his powers and duties pursuant to the Auditor General Act, sections 5 to 12, headed "Powers and Duties." These sections express the total of his powers. Section 5 is the total of those powers he may, by law, audit examine. With the heading "Examination," section 5 reads:

The Auditor General is the auditor of the accounts of Canada . . . .

I repeat, "The Auditor General is the auditor of the accounts of Canada." These are accounts of the government departments headed by Crown ministers who are responsible to the Commons for their expenditures. The Senate is not a government department, nor is it headed by a minister responsible to the Commons, nor is it a government agency or a Crown corporation with a minister responsible for it.

Senators' and Senate expenses are no part of the government's accounts, the accounts of Canada. The former Leader of the Government in the Senate and the Auditor General, her invitee in audit, have ignored this. They do not admit that the Auditor General's role, as the auditor of the Public Accounts, is to verify for the Commons that the public expenditures are as dictated by the Commons appropriation acts and their schedules. This verification is the Auditor General's statutory duty to the Commons House pre-eminence in the national finance. As I said before, it is the "control of the public purse." The proper expenditure of their appropriation is the Commons House's absolute interest in the "accounts of Canada" and the audits thereof. Their absolute interest is the "control of the public purse."

Honourable senators, the Senate accounts are no part of government departments' "accounts of Canada." Black's Law Dictionary, Revised Fourth Edition, defines public accounts, at page 35, as:

The accounts kept by officers of the nation, state, or kingdom, of the receipt and expenditure of the revenues of the government.

Senators' expenses are no part of the "accounts of Canada," which, by the Auditor General Act are available to the Auditor General's audit examination, as "the auditor of the accounts of Canada," by the Powers And Duties section 5 of this Act.

Honourable senators, no Senate Government Leader's Government motion, moved and adopted here as government business in a government whipped vote, can change this Act to grant this auditor a power to compel senators to his audit examination. Such power is hostile to the auditor's legal duties to the House of Commons. For this reason, such a power was never considered nor granted to this Auditor General, because seasoned and experienced lawmakers knew and understood that such power would lead to epic constitutional catastrophes, as the one now before us in his report. The Government Leader's motion was couched in insipid words that belie its gravity. Moved June 5, 2013, it said, in Senate Debates, page 4133:

That the Senate invite the Auditor General of Canada to conduct a comprehensive audit of Senate expenses, including senators' expenses.

That day, Senator LeBreton, responding to my question whether her motion was a government motion, said in Senate Debates, page 4134:

I acted in my capacity as Leader of the Government in the Senate . . .

So it is unquestioned. It is a government motion, government business.

Honourable senators, motions and resolutions once adopted become orders of the houses. Those affected are liable to the houses' mighty curial and judicial powers, contempt and impeachment. By motion, the Senate Government Leader placed an officer with unique duties, to report to the Commons, squarely within the Senate's judicial and curial powers, and treated it like an invitation. The word "invite" is pleasant and cozy. But this government action, and his compliance, are a grave matter that have impaired and compromised this officer's independence. As I said, compromised this officer's independence.

This is bad parliamentary practice and bad politics. Constituted by statute, this officer was intended to be wholly independent of government control, to have a unique judge-like impartiality. This independence was needed to permit him, the auditor, to express his opinion on government spending, free from reprisals from government Crown ministers, no little fare.

Honourable senators, Senate and senators' expenses are not part of the government's public "accounts of Canada." Open to audit and ever audited, Senate expenses are not legally available to Auditor General examination and compulsion. In the 1987 Petrofina case, Federal Court of Appeal Justice Heald, in ruling, spoke to the limits of the Auditor General's powers. He ruled that the cabinet, the Privy Council, and parliament were not subject to this Auditor's compulsion. He noted that the Auditor General Act section 13(1) that says "the fulfilment of his or her responsibilities," means specifically those responsibilities as "the auditor of the public accounts" that is limited to government departments' public accounts. The Senate, the Commons, and the Sovereign, are not subject to Auditor General audit compulsion. Mr. Justice Pratte concurred, and said, at paragraph 21, that the Auditor General:

. . . is the auditor of the accounts of Canada . . . whatever be his rights under ss. 13 and 14, he may only exercise them in fulfilling his responsibility as auditor of the accounts of Canada.

In the 1989 appeal in the same Petrofina case, the Supreme Court confirmed this responsibility, and ruled against this Auditor General's quest for a writ of mandamus against the cabinet. Chief Justice Dickson held that the Auditor's powers and duties are limited to those stated by Parliament in his statute, the Auditor General Act. His judgment, at page 103 said:

The grundnorm with which the courts must work . . . is that of the sovereignty of Parliament.

So the courts must work within it, and so must the Auditor General.

The grundnorm of constitutionalism, I repeat, is the sovereignty of parliament, not alterable by the Auditor General.

Senators' expenses are no part of the public administration and the public services' public accounts of Canada. The Auditor General is the auditor of the public accounts. By ministerial responsibility, Crown ministers, as the heads of all government departments, have the lead role in public spending and are constitutionally liable to the Commons for these monies. The government, the ministry, is liable to Commons', the pre-eminent power, the "control of the public purse." But the Senate has no liability to the Commons for its spending, which was the purpose for the creation of the Auditor General in the first place.

Honourable senators, senators' expenses, not government expenditures, cannot be subjected to Auditor General audit exam. By the British North America Act, 1867, constitutional relations between our two houses of parliament, the Senate and Commons, the two coordinate institutions, are known as constitutional comity. This Act received into Canada, the full powers of the ancient British parliament's lex et consuetudo parliamenti, the law of parliament. The lex prescribes that the two houses ought not inquire into each other's affairs, and forbids that the one judges the others. Each house is the master of its own proceedings. This 'comity' gives our constitution balance, equilibrium and equipoise.

Honourable senators, the proof that Senate expenses can be no part of the government's public accounts, is the fact that no parliamentary process exists to put senators expenditures before the House of Commons Public Accounts Committee, that drives their "control of the public purse," and their examination of the public accounts. This is proof positive. Senate expenses are no part of the "the accounts of Canada." Our two houses are self-managing. They are constituted directly by our British North America Act 1867, sections 17 and 18 which establish the two houses and the Queen, the three separate coordinate entities as the one Parliament of Canada. This was made clear in the uncertainty about to whom the Auditor General would report on the Senate audit, and in what form the report should take. All this absolutely prove that this auditor was outside his lawful ken. Webster's Encyclopedic Unabridged Dictionary, 1989, defines "report," at page 1217:

. . . an account or statement describing in detail an event, situation, or the like, usually as the result of observation, inquiry, etc.: . . .

Honourable senators, "report", in the Auditor General Act means strictly his reports to the House of Commons on the "accounts of Canada." Reports follow his public accounts duties. He has no duty to report to the Senate, because he does not audit the Senate. In short, no duty to audit, no duty to report, and no one to report to.

Honourable senators, the Auditor General's want of jurisdiction to audit the Senate is confounded by the anomaly that this Senate audit was moved here by the Senate Government Leader as a government motion, for government business, with priority over Senate proceedings. Senate Rule 4-13 (1), says:

Except as otherwise provided, Government Business shall have priority over all other business before the Senate.

Colleagues, by performing his Senate audit as government business, this Auditor has wholly compromised, I believe irreparably, the independence of this office, in its public accounts role. Days ago, in his June 9 press conference, he said that the real cost of this Senate audit was $23.5 million. To me, colleagues, this is a $23.5 million lunacy. This lunacy is best expressed in his idea that an independent body of non-senators should have oversight of the Senate. His report's recommendation 52 states, at page 11:

The oversight of Senators' expenses should be performed by a body [the "oversight body"], the majority of whose membership, including its chair, is independent of the Senate. The members of this oversight body should be selected so that their collective skills, knowledge, and experience enable the oversight body to carry out its duties thoroughly and efficiently.

This recommendation is not even credible, not even debatable. It's not even vaguely credible. As a matter of fact, it is so infantile that one wonders how somebody could have actually put this forward as a serious proposition to be considered by us senators. This juvenile advice was costly. He has wilfully hurt many fine senators, sounding a lot like the Queen of Hearts, "Off with their heads!"

That is a group of senators that are now suffering under this "for RCMP investigation group," that this Auditor General created. But I say unto them, that they should take comfort in the Auditor General Act, sections 18.1 and 18.2, headed Immunities. This section shields him from the legal action of his audit subjects. This section has no application to senators and cannot shield him from them. This officer has no immunity from them in his illegal and illicit audit of senators, and his public scorn of the Senate and of senators. These damaged senators should know that they are free to take legal action as they see fit. These senators should know that. I wish to bring some comfort to them because I know that many of them are smarting in anxiety.

Honourable senators, the Finance Minister, Joe Oliver, is the minister responsible for the Auditor General. Will he answer to the Commons for the cost of this lunatic Senate audit? Is he responsible to the Commons and their Public Accounts Committee for the cost of this Senate audit? Did he accept that then Government Leader Senator LeBreton's motion was government business? Did he agree that monies appropriated to the Auditor General for public accounts' audits should be applied to unexplained government business audit of senators?

Senator LeBreton has never told us what the nature of the government business was in her government motion for the Auditor General to audit the senators.

Why was the independent Auditor General asked to do government business? What is that government business? What section of the Auditor General Act permits him to do government business as an extra-legal audit? Is this government business audit of senators "value for money?" Who knows? Who will say?

These questions have never been answered; they haven't even been thought about.

Honourable senators, I have said that the Senate audit is a mortal compromise of the independence of the Auditor General of Canada. This is a serious matter. I flag Ian MacDonald's June 9 ipolitics.ca article on the Senate audit, titled "The AG and the Senate: $23 million to catch $1 million? Are we kidding?"

He wrote:

It isn't just senators' reputations that are on the line — it's Ferguson's as well. Leave aside for a moment the nine senators referred to the RCMP —

I cannot put these senators out of mind; I feel such pain for them.

I will repeat that —

The Hon. the Speaker: I we regret to inform you that the time has lapsed.

Senator Cools: Can I have five minutes? I am on the home stretch.

He wrote:

It isn't just senators' reputations that are on the line — it's Ferguson's as well. Leave aside for a moment the nine senators referred to the RCMP; should Binnie dismiss his conclusions about many or most of the Senate 21, Ferguson's reputation for competence — not to mention that of his consultants — would be in trouble. He'd need to consider his own future at that point, if only for the integrity and standing of the AG's office.

You used to use the word AG to mean Attorney General, but now they use the AG to mean Auditor General.

Honourable senators, I wish to put to you the very same point that I put to Senator Day earlier today. As you know, in 1988 the Senate's National Finance Committee did a profound study of the role of Auditor General. At that time, there were many senators who were still smarting from the combative Auditor General Macdonell, who won the then new 1977 Auditor General Act. We did an instructive study at the Committee of National Finance. Under the Main Estimates, we looked at the Auditor General, then Kenneth Dye. We heard from the Auditor General, but we also heard from a body of scholars, including Professor Sharon Sutherland, who had been studying the role of the Auditor General and has for years.

I would leave with senators the idea that I think the time has come for another serious Senate committee study of the role and the duties of the Auditor General of Canada.

(On motion of Senator Cools, for Senator McCoy, debate adjourned.)

The remainder of this day's Senate Debates are available here.