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Competition Bureau Canada and Industry Canada officials appeared before the Senate National Finance Committee on March 11, 2009. The Committee was studying Bill C-10 (Budget Implementation Act); this Bill contained considerable amendments to the Competition Act. These amendments were in response to the Competition Policy Review Panel Report of June 2008 and a number of previous Committee reports, uncompleted legislative initiatives and public consultations. Bill C-10 received Royal Assent on March 12, 2009.

Competition Bureau Canada officials appeared before the Senate Committee on Banking, Trade and Commerce on March 25, 2009. The Committee was conducting a study on credit card, bank card, and Interac rates and fees. The Committee had not completed its report within the 2008�09 fiscal year.

2008 December Report of the Auditor General of Canada � Chapter 2 � Governance of Small Federal Entities

Despite their size, small entities can have a significant impact on the health, safety and quality of life of Canadians. This audit defined small entities as federal organizations with fewer than 500 employees or annual approved expenditures of less than $300 million. As publicly funded bodies within the government, small entities need to ensure prudence, probity and effective control over the spending of public funds. Some characteristics of small entities � notably appointment processes, independence and limited capacity � make it more challenging for them than for much larger federal organizations to respond to the management, control and reporting requirements of the government�s central agencies. Good governance requires effective oversight of the organizations that the federal government controls.

The audit examined the governance regime from the centre, focusing on 3 central agencies: the Privy Council Office, the Treasury Board of Canada Secretariat and the Canada Public Service Agency. Activities of the networks that comprise the Community of Federal Agencies, and their interactions with these central agencies, were also considered. In addition, to examine how the governance regime functioned in practice, 3 portfolio departments and two small entities within each portfolio were selected: Industry Canada � the Copyright Board of Canada, and the Social Sciences and Humanities Research Council (SSHRC).

The Audit found that at Industry Canada, the approach to portfolio coordination is in transition. Traditionally, the portfolio affairs office was the main vehicle for dealing with entities, but currently, department units with relevant policy and programming expertise are assuming greater responsibilities. These new arrangements are intended to foster a more direct relationship among departments and the entities in their ministers� portfolios.

*** No official response was required of Industry Canada.

In their 2006�07 performance reports, federal departments and agencies reported a total of
$1.9 billion in fees collected for everything from a passport to a licence for manufacturing pharmaceuticals. The amount charged for these fees must be related to the cost or the value of what is provided. In determining the amount to be charged for a fee, government organizations also need to consider, for example, what proportion of the cost or value is appropriately borne by the fee payer and what proportion by the general taxpayer through tax revenues. Increasingly, fee payers are challenging the validity of fees, and courts have held that where a reasonable relationship could not be demonstrated between the fee and the cost or value of the fee, the fee represented an unlawful tax and, in a recent Supreme Court case, had to be repaid.

For the purposes of the audit, 13 fees, established by 6 federal organizations (including Industry Canada) responsible for a major portion of the fee revenues reported by the government, were selected. The audit looked at how these organizations established the cost of the fee and determined the amount to be charged. It also looked at how they measured, monitored and reported on the performance of the fee-related activities.

The audit found that Industry Canada determined the initial amount to be charged, according to market value, for 3 of the 4 �spectrum� licence fees we selected in our sample. These fees cover licences for cellular phone services and television signals broadcast via satellite, and facilitate fire, police, ambulance and other public safety communications. Industry Canada took all reasonable steps to estimate the value of these licences. The fees will remain at the current amount until a review of the fees is done and the fees are adjusted. As a result, the Department will need to continue to monitor value and ensure that the fees reflect any related changes. With respect to determining the benefit to the fee payer, the Department indicated that its policy and approach to determining the amount to be charged for these fees was to identify an amount that represented a fair return to the Canadian public for the use of a public resource and an incentive to use the spectrum efficiently.

Recommendations and Industry Canada Response:
*** 1.46 Recommendation: �Industry Canada (radio licence fees)�should�establish formal systems and practices to periodically review these fees. In this review, the departments should consider changing fee-related costs or value, the portion of the fee that should accrue to fee payers and taxpayers respectively, and other factors related to changing circumstances. They should also consider developing a longer-term approach to the fee structure that would enable the fee to be automatically adjusted to reflect these various factors, subject to the requirements of the User Fees Act (1.39�1.45).�
Industry Canada�s response: �Industry Canada agrees with the recommendation and will establish practices to periodically review its spectrum and radio licence fees. The system and practices will take into consideration the factors identified. Following this review, Industry Canada plans to review the fees set in 1994 by the Governor-in-Council under the Radiocommunication Regulations.�

*** 1.73 Recommendation: �Industry Canada�should consider improving the transparency of their fees that were subject to this audit by providing more complete public reporting of their financial and non-financial performance information (1.68�1.72).�
Industry Canada�s response: �Industry Canada agrees with the recommendation and will consider how it might improve the transparency of its spectrum fees, and how reporting of financial and non-financial performance information might be improved. This reporting will be provided in the Department�s 2008�2009 Departmental Performance Report and its 2009�2010 Report on Plans and Priorities.

The environmental petitions process is a formal way for Canadians to bring concerns about the environment and sustainable development to the attention of federal ministers and obtain a timely response. The petitions process was created as a result of a 1995 amendment to the Auditor General Act. On behalf of the Auditor General of Canada, the Commissioner of the Environment and Sustainable Development manages the petitions process and monitors responses to ensure that relevant questions and issues raised by Canadians receive a response from federal ministers.

Petition No. 229: Installation of cellular towers in Simcoe, Ontario (Response Date: 2008-04-18)
Petition No. 230: Impact of cellular phone transmitters on human health (Response Date: 2008-04-19)
Petition No. 230B: Follow-up petition on the impact of cellular phone transmitters on human health (Response Date: 2008-11-11)
Petition No. 231: Barrel burning (Response Date: 2008-05-15)
Petition No. 235: Health risks posed by electromagnetic radiation exposure from cellular towers (Response Date: 2008-05-16 )
Petition No. 235B: Follow-up petition on the health risks posed by electromagnetic radiation (Response Date: 2008-11-05)
Petition No. 241: Mercury waste from compact fluorescent lightbulbs entering the environment (Response Date: 2008-09-12)
Petition No. 247: Environmental health impact of electromagnetic radiation (Response
Date: 2008-10-03)
Petition No. 252: Environmental health issues related to a hydroelectric transmission project in Tsawwassen, British Columbia (Response Date: 2008-10-30)
Petition No. 253: Potential adverse health effects from phones using Digital Enhanced Cordless Telecommunications (Response Date: 2008-11-01)
Petition No. 254: Environmental and human health effects of compact fluorescent light bulbs (Response Date: 2008-11-04)
Petition No. 255: Health impact of electromagnetic radiation from telecommunication towers located in close proximity to residential areas (Response Date: 2008-11-06)
Petition No. 255B: Relocation of transmission towers from Triangle Mountain to a non-residential site (Response Date: 2008-12-03)
Petition No. 264: Installation of a radiocommunication antenna system atop the Simcoe water tower in Ontario (Response Date: 2009-01-01)

1. Update 2009: 2004�10 CESD Chapter 4: (related to SEA) Recommendation 4.47

Industry Canada has achieved full implementation of the recommendation. The Department does have a management system in place, including an accountability infrastructure, to support the proper application of the Cabinet Directive on environmental assessment of policies, plans and programs. Industry Canada has an SEA template available on our website which helps officers identify and describe proposals that require a SEA. The Department has developed and implements a tracking system to track all proposals subject to the directive, preliminary scans and detail assessments. The Department regularly provides internal guidance to staff conducting SEAs and provides an annual training course to departmental staff on how to conduct SEAs.

In the spirit of continual review and renewal, however, the Department�s management system, quality control procedures, consultation, communication, follow-up and evaluation procedures could be updated and improved in order to address gaps in the system. Industry Canada commits to undertaking this review and renewal over the current fiscal year, while taking into account the conclusions and recommendations flowing out of the cross-government evaluation of SEA conducted by Canadian Environmental Assessment Agency (CEAA) this past fiscal year. The Department has played a very active role in this evaluation of SEA.

2. Update 2009: 2003�10 CESD Chapter 3 � SDS: Case Studies, Recommendation 3.65

While no specific consolidated report has been produced by Industry Canada on the adoption of, and the economic and environmental benefits associated with, eco-efficiency and environmental technologies in Canada, the Department continues to support studies and projects that examine the sustainability performance of Canadian industry in order to assess and customize its products to address gaps identified.

In fiscal year 2008�09, Industry Canada contracted Stratos Inc. to conduct a study of 7 national and international firms to learn their leading practices with respect to integrating sustainability practices (including eco-efficiency and environmental technologies) into their operations and how they communicate these practices to the public at point of purchase. 4 areas of focus were assessed: product attributes, operational performance, product life cycle, and global and community issues. These materials and a learning tool will be made available on the Industry Canada CSR website during fiscal year 2009�10.

3. Update 2009: 2003�10 CESD Chapter 3 � SDS: Case Studies, Recommendation 3.63

Industry Canada runs an annual one-and-a-half day Sustainable Department Development training course. Each course is attended annually by about 20 officers in the department. Course and trainer evaluations are distributed to participants and each year the course and trainers are highly rated. In the spirit of continual review and renewal, however, we plan to overhaul the course this fiscal year and identify some new speakers to participate in the course.

The hits on Industry Canada�s Corporate Social Responsibility (CSR), SD, Eco-Efficiency (EE) and SEA websites are measured on a monthly basis. We view the hits as an indication of the use of Industry Canada products that are available on our websites. Over fiscal year 2008�09, the sites received the following hits: SD � 26,944; CSR � 80,094; EE � 13,621; SEA � 3,643.

This past fiscal year, Industry Canada conducted work that will lead to the placement of case studies on our CSR website in fiscal year 2009�10. The case studies emerged as a result of contracts with consultants, including Stratos and Strindberg and Associates. The case studies are on 7 leading Canadian and international companies (their integration of sustainability practices into their operations and how they communicate these practices at point of purchase) and BC Hydro�s sustainability-integrated decision-making framework.

Industry Canada was one of 11 federal organizations selected to participate in the Public Service Commission�s Audit of the Federal Student Work Experience Program and subsequent appointments through bridging mechanisms. The objective of the audit was to verify whether 250 Federal Student Work Experience Program (FSWEP) and bridging appointments made between April 1, 2006, and March 31, 2007, were in accordance with the legislative and policy requirements and respected the appointment values. The audit found that FSWEP and bridging files were poorly documented and did not always support selection and appointment decisions. Industry Canada was cited, however, as having a noteworthy practice for putting in place an annual monitoring exercise of staffing files, including bridging appointments.