Mahsi, Mr. Speaker. The Standing Committee on Public Accounts also wishes to highlight a number of concerns with respect to the way the Department of Health is managing people within the staffing structure. First and foremost among these, is the department's completely unacceptable performance in terms of aboriginal hiring. Clearly Health administration should reflect the cultural character of the people it serves. With only 11 per cent aboriginal representation within headquarters personnel and around 40 per cent in health and hospital boards, this has not been accomplished. The standing committee is proposing that the department target planning and strategic resources toward increasing aboriginal access to the health care profession and health administration careers.

The standing committee is also concerned about the fact that employee orientation, cross-cultural awareness, staff performance appraisal, and exit interview procedures within the department are presently inadequate.

Managing information is a notable weak point within the Department of Health. Currently computerized statistical systems are inflexible and cannot interface with each other, while board accounting systems are neither standardized nor efficient. Although medical research is taking place in northern communities, the department lacks policy and procedures which allow it to benefit. Boards are unfamiliar with what other boards are doing. Managers are unfamiliar with what other managers are doing. In many ways, Mr. Speaker, information management is driven largely by ad hoc needs to respond to public events or administrative prices. The standing committee is of the opinion that this situation cannot continue and has identified a number of potential areas for improvement.

The management of capital assets by the Department of Health has not been carried out as well as it might have been, according to the Auditor General. Although some impressive work is under way with respect to revising capital standards and criteria for health facilities, as well as the development of a new system for tracking capital assets. Further improvements can be made by ensuring that follow-up evaluations are completed after the construction of new facilities.

A number of specific financial issues were also identified by the Auditor General. Again, the standing committee was encouraged to see that progress has already begun on most of these including the improvements of forecasting models and procedures for budgetary monitoring. Progress in this area should continue to be a priority of the department.

Management reporting and accountability procedures have not been carried out as well as they should have been. Specifically there is an inadequate use of the government's management for results system within the Department of Health. The standing committee is of the opinion that this department is probably not unique in that respect, but nevertheless, proposes that a program of staff in-service training should be carried out to build expertise and awareness in this important management area.

Throughout the public review, Mr. Speaker, the Standing Committee on Public Accounts was astounded by the number and the complexity of problems facing the Department of Health. At the same time the committee was provided with information which suggests that at least some of these issues are now being addressed.

The very positive initiative to establish a memorandum of understanding with health boards and indeed an earlier indication of a different attitude toward building partnerships with health stakeholder organizations seems, to offer some promise for a change in working relations.

Departmental working groups have been established to revamp board accounting procedures and to address time lags in receipt of cost data from health insurance programs.

The announcement that a nursing diploma program will commence this September at Arctic College holds potential for effecting an increase in aboriginal health care workers.

The consolidation of all medical travel programs within the Department of Health should remove policy inconsistencies with respect to GNWT employees.

In short, progress is being made in a number of important areas. There is still much work to do, however, and the work will require a collaborative approach on the part of all health stakeholders including the Department of Health.

The Standing Committee on Public Accounts is of the opinion that the Auditor General's report can serve as the framework document for the Legislative Assembly to use in elevating continued progress in these areas.

To further assist the process, the Standing Committee on Public Accounts also offers a number of recommendations dealing with the specific areas identified by the Auditor General.

Mr. Speaker, that concludes the summary of the standing committee's report and prior to making a motion to refer this to committee of the whole, as the report is very lengthy and detailed, I would request the consent of the House to have the report considered read and printed in Hansard.

Thank you, Mr. Speaker. You do not have to listen to me read the whole report. As I indicated, it is a lengthy report, but some Members indicated perhaps I should read it.

Motion To Accept And Move Committee Report 18-12(3) To Committee Of The Whole

Nevertheless, Mr. Speaker, I move seconded by the honourable colleague from Inuvik, that the final report ;of the public review of the report of the Auditor General of Canada on a comprehensive audit of the Department of Health, be received by the Assembly and moved into committee of the whole, for discussion.

The recommendations are as follows:

Recommendation 1

That the Legislative Assembly express dissatisfaction with the management response made by the Department of Health to the Auditor General's report and with the presentation of information on organizational structure and information on human resource management, provided during the public review of the report.

Recommendation 2

That budget control and financial reporting requirements policies within the Department of Health should be reviewed to ensure that they reflect the improved financial management capabilities of health and hospital boards;

And further, that, where necessary, revisions to policy directives should be developed in consultation with health and hospital boards and readied for full implementation by September 30, 1993.

Recommendation 3

That the Department of Health transfer responsibilities and resources for financial and budgetary monitoring from its hospital and health facilities division to its finance and administration division;

And further, that the hospitals and health facilities division be given a mandate to deliver technical and professional consulting services to health and hospital boards through extensive on-site support.

Recommendation 4

That the Department of Health should complete a functional review quickly and ensure that it considers all headquarters functions.

Recommendation 5

That the Department of Health prepare and, when necessary, regularly update a document which formally defines the rationale, purpose and substance of "The NWT Way" for health delivery;

And further, that the Department of Health develop a process through which stakeholder organizations and others can provide input to the ongoing formulation of this approach.

Recommendation 6

That the Department of Health prepare, in consultation with health and hospital boards, aboriginal organizations and other health stakeholder groups, a plan for the ongoing administration and delivery of health services in the Northwest Territories;

And further, that a draft version of the plan should be brought forward no later than December 31, 1993.

Recommendation 7

That the Department of Health accord a high priority to the development of work load assessment instruments and procedures applicable to nurses in the Northwest Territories;

And further, that the Department of Health, in consultation with the NWT registered nurses' association and other stakeholders, should carry out work load assessment studies which enable better planning for the allocation of nursing resources.

Recommendation 8

That the Department of Health develop an appropriate strategy for attracting and supporting aboriginal people who want to enter the health professions;

And further, that the Minister of Health table a complete strategy document in the Legislative Assembly by the fall session in 1993.

Recommendation 9

That the Department of Health develop a strategy for attracting and supporting aboriginal people who want to enter the field of health administration;

And further, that the Minister of Health table a complete strategy document in the Legislative Assembly by the fall session in 1993.

Recommendation 10

That the Department of Health prepare a comprehensive affirmative action plan;

And further, that the department assist health or hospital boards of management to prepare comprehensive affirmative action plans, where requested.

Recommendation 11

That the Department of Health, in consultation with the Department of Education, Culture and Employment Programs, review sources, eligibility criteria and amounts of financial assistance available to students wishing to pursue studies in health professions or health administration;

And further, that the departments survey current students enrolled in health-related disciplines to determine the adequacy of available financial assistance, and include survey results in the report.

Recommendation 12

That the Department of Health establish a plan which provides an effective cross-cultural orientation and training program for newly hired staff; and further that, for all departmental personnel, individual training plans within the performance review and planning process should include a requirement for cross-cultural awareness training at least every fifth year;

And further, that senior managers within the Department of Health provide a model for other employees by each participating in a program of cross-cultural awareness prior to December 31, 1993.

Recommendation 13

That the Department of Health implement a system of exit interviews for all departing staff no later than October 1, 1993;

And further, that the department encourage and support health and hospital boards to implement similar procedures.

Recommendation 14

That all supervisors within the department complete in-service training in the use of the GNWT performance review and planning system for staff appraisal no later than April 1, 1994.

Recommendation 15

That the Department of Health, in consultation with the Northwest Territories Science Institute, prepare a comprehensive report on the North of 60 research program;

And further, that this report should include an analysis of whether funding criteria identified in June 1989 have been met;

And further, that this report should clearly indicate the respective responsibilities of the Department of Health, the Science Institute, and NHRDP;

And further, that this report should be brought to the Legislative Assembly by the fall session in 1993.

Recommendation 16

That the Department of Health prepare a document which summarizes health research studies carried out within the department since 1988; and, proposes policy parameters for the design, approval, ethical standards, consultation, local involvement and report distribution of future health research studies within the department.

Recommendation 17

That the Department of Health implement measures to improve the flexibility and usefulness of the HIS system; review and modify procedures for completion of HIS system claim forms and code compatibility; and, develop a single reporting format for HIS and CHMIS by April 1, 1994.

Recommendation 18

That the Department of Health improve registration tracking procedures to ensure that, as people leave the Northwest Territories, their eligibility for territorial health insurance ceases.

Recommendation 19

That all territorial-provincial agreements relating to reciprocal medical billings should be reviewed and updated during the next renewal period for each one;

And further, that the department should ensure that copies of all agreements are on file by June 30, 1993.

Recommendation 20

Recommendation 21

That the Department of Health develop, within the Otto Schaeffer health resource centre, a repository of all current policy and procedures established by health and hospital boards, to facilitate sharing of information between boards and within the department.

Recommendation 22

That the Department of Health develop a process through which senior managers become familiar with activities and mandates of other divisions or with board administration, including, where appropriate, the temporary rotation of officials.

Recommendation 23

That the Department of Health develop a new mandate for the policy and evaluation division, emphasizing responsibility for tactical and strategic planning and ongoing legislative and policy review.

Recommendation 24

That the Department of Health work with health and hospital boards to develop a plan by January 1, 1994 for the standardization of board accounting systems;

And further, that the department and boards complete implementation and training for new system components by April 1, 1994 and complete a comprehensive evaluation of system performance by April 1, 1993.

Recommendation 25

That the Department of Health ensure that post-occupancy inspections are carried out for all capital construction projects using standard criteria.

Recommendation 26

That the Department of Health accord a high priority to final development and implementation of the capital asset tracking system.

Recommendation 27

That all senior consultants, heads of sections and directors of divisions within the Department of Health should complete in-service training in the use of MFRS by April 1, 1994.

Recommendation 28

That the Department of Health prepare a comprehensive report on which definitive objectives have been met since 1988, and include a plan for meeting any unfulfilled objectives.

Introduction

The Standing Committee on Public Accounts, under the authority given to it by this House, has now completed a review of Tabled Document 5-12(3), the report of the Auditor General of Canada on a comprehensive audit of the Department of Health.

Throughout the review process, the committee focused on the following aspects:

-findings and recommendations reported by the Auditor General;

-Management Response to the Auditor General's Report;

-departmental plans, strategies and objectives related to the substance of the Auditor General's report;

-opinions comments, and recommendations of health stakeholders, arising from the Auditor General's report;

-approaches to implementing organizational or procedural changes recommended by the Auditor General;

-pertinent legislation, regulation and policy; and,

-other matters related to the activities and administration of the Department of Health which were raised during public hearings or were observed to be associated with the findings and recommendations of the Auditor General.

The Review Process

The Standing Committee on Public Accounts held public hearings on the matter of the Auditor General's report on several occasions during the early months of 1993.

Initial public hearings were held in Yellowknife from January 6 through January 8, 1993. At that time, the standing committee heard witnesses from the office of the Auditor General of Canada, the Department of Health, the Stanton Yellowknife Hospital Board of Management and St. John Ambulance.

On January 25 and 26, the standing committee held hearings in Rankin Inlet. Representatives of the Keewatin regional health board, the Baffin regional health board and the Kiguti Dental Clinic all appeared as witnesses before the standing committee, in addition to the Honourable John Todd, who appeared in his capacity as Member of the Legislative Assembly for Keewatin Central.

On January 27 and 28, the standing committee held hearings in Inuvik. At that time, it heard representatives from the Kitikmeot regional health board, the Inuvik regional health Board, the Inuvik Medical Clinic and the Inuvialuit Regional Corporation.

On January 29, the standing committee held further hearings in Yellowknife. At that time, it heard again from officials of the Department of Health, as well as witnesses representing the NWT Health Care Association, NWT Registered Nurses' Association, the Dene Nation, the Union of Northern Workers and the Native Women's Association. In addition, the standing committee also received submissions from a public witness, Ms. Wendy Colpitts and from Mr. Jim Antoine, Member of the Legislative Assembly for Nahendeh. As well, the standing committee received a written submission from the Metis Nation. A subsequent written submission has since been received from the Northwest Territories Medical Association.

On January 30, the standing committee held public briefings in Yellowknife and invited deputy ministers from other GNWT departments referenced in the Auditor General's report.

Subsequent meetings have also been held by the standing committee to discuss written submissions, to consider evidence received during the public hearings and to review independent research findings.

The Standing Committee on Public Accounts wishes to acknowledge the cooperation and thoughtful input received from the many witnesses who appeared or submitted written briefs. Members of the standing committee have remarked upon the extensive preparation and clarity which characterized all presentations by health and hospital boards and by public and professional organizations that participated in the review. The standing committee has given careful consideration to each of the presentations and has taken the various positions and comments into account during its deliberations on the Auditor General's report.

In addition, the Standing Committee on Public Accounts also wishes to acknowledge the assistance received from the office of the Auditor General of Canada. The committee particularly appreciated the attendance and helpful comments of the Deputy Auditor General of Canada and officials from the Edmonton regional office during hearings in Yellowknife.

Historical Context Of The Audit And Committee Review

On March 11, 1991 the 11th Legislative Assembly carried a motion requesting the Auditor General of Canada to undertake a comprehensive audit of the Department of Health.

This arose from a recommendation in a report of the 11th Assembly's Standing Committee on Finance, Committee Report 2-91(1), on its review of proposed 1991-92 Main Estimates. In supporting the need for a comprehensive audit of the Department of Health, the finance committee had noted several concerns, including:

- high medical travel costs;

- the lack of criteria for planning new capital facilities; and

- the admission that capital costs are poorly estimated in many cases.

The Standing Committee on Finance report concluded that:

As a result, the committee does not believe that the department can assure the Assembly that its operations are effective and are being carried out with due regard for efficiency and economy. Although the department is proposed to be included in the planned base review, the committee wishes to ensure that an independent review is conducted as soon as possible.

The Auditor General of Canada performed the audit of the Department of Health in late 1991 and early 1992. A combination of questionnaire procedures, interviews and document review was used, in keeping with generally accepted auditing principles. The audit covered the approximately four-year period since the 1988 transfer of health responsibilities from federal to territorial authority. The scope of the audit was defined fairly broadly, but excluded:

- duplication of previous audit work done recently;

- consideration of the impact of land claims or community transfer;

- commentary on the impact of the proposed consolidation of the Departments of Health and Social Services; and,

- carrying out of operational audits of any hospitals or health centres.

In introductory comments to the resulting report, the Auditor General remarked on the rationale for the audit, pointing out that:

The topic of health in the NWT is contentious, as demands for more services run into the realities of fiscal restraint. At present, health is the single most expensive program in the NWT and, at an annual cost of close to $200 million, it consumes some 16 per cent of the entire government budget.

The Auditor General's final report was received by the Speaker of the Legislative Assembly in October 1992 and was distributed to the public at that time. The report on the comprehensive audit covered seven aspects of departmental operations and spending:

- organizational structure;

- planning for the future;

- managing people;

- managing information;

- capital assets;

- financial issues; and,

- management reporting and accountability.

The report was formally tabled in the Legislative Assembly on November 17, 1992, Tabled Document 5-12(3), and was referred to the Standing Committee on Public Accounts for public review.

At its November meeting, the Standing Committee on Public Accounts agreed that the following basic principles should guide the committee review process:

- The review would need to be initiated in a timely fashion and scheduled in a way that took advantage of public interest momentum generated when the report was first transmitted;

- Members of the standing committee would have to become fully aware of the contents of the report and of the rationale for the Auditor General's conclusions;

- The standing committee would avail itself of professional consultation provided by the office of the Auditor General;

- While input from the Auditor General was recognized as extremely valuable in terms of identifying and understanding problem areas, the standing committee would have exclusive responsibility for conducting the review and would be accountable for its final findings and recommendations;

- The review process would have to include ample opportunity for interchange between the Department of Health and the standing committee;

- The review would also need to be structured to allow consumer groups, professional associations and other stakeholder organizations in the health system an opportunity to participate;

- Input from aboriginal organizations would be a critical component of the review process;

- The standing committee would carry out its review in the most cost-effective manner possible; and,

- Finally, the standing committee would endeavour to place its report before the Legislative Assembly during the February/March 1993 sitting.

In carrying out its review, the Standing Committee on Public Accounts was mindful that other committees of the Legislative Assembly were examining additional aspects of the Territorial health system. The Standing Committee on Agencies, Boards and Commissions, during the period from January 1992 through March 1993, completed a review of health and hospital boards and has now reported its findings and recommendations to the Legislative Assembly, Committee Report 14-12(3). A Special Committee on Health and Social Services was established by a motion of the Legislative Assembly on November 15, 1991 and has been examining global issues related to the organization and delivery of programs and services in these areas. The special committee, to date, has provided four interim reports to the Legislative Assembly and has indicated its intent to deliver its final report during the fall of 1993.

Some Comments On Comprehensive Auditing

At the request of the Legislative Assembly, the Auditor General of Canada carried out a "comprehensive audit" of the Department of Health. Some comments on concepts related to comprehensive auditing may be in order.

Comprehensive auditing can be defined as a relatively new type of auditing designed to review and report on the management of financial, human and physical resources, so as to provide the greatest possible degree of accountability in the expenditure of public funds. It includes assessing the adequacy of management systems and controls to ensure due regard to economy, efficiency, and effectiveness.

The comprehensive auditing concept embraces three types of audit work which are interrelated but can be separated into distinguishable elements. These are:

- verification of financial information, which could include the auditing of financial statements;

- compliance auditing; and,

- value for money auditing.

It is the "value for money" component of the comprehensive audit which often draws the most attention, as it seeks to comment on the "three E's":

- economy ... which refers to the terms and conditions under which entities acquire human and material resources. An economical operation requires that these resources be obtained in appropriate quality and quantity at the lowest cost;

- efficiency ... which refers to the relationship between goods or services produced and resources used to produce them. An efficient operation produces the maximum output for any given set of resource input - or it has minimum outputs for any given quantity and quality of service produced. The underlying management objective is productivity; and, - effectiveness ... which concerns the extent to which a program achieves its goals or other intended effects.

In most cases, the assessment of effectiveness focuses on operational effectiveness, by examining whether appropriate objectives, systems and operational procedures have been established. "Program effectiveness" is usually assessed by a process called "program evaluation", which determines whether intended effects are, in fact, being achieved. Program evaluation is the responsibility of the entity being audited, and is not usually part of the scope of a comprehensive audit.

In the case of auditing health entities, the situation becomes complicated somewhat further by the fact that health disciplines associate slightly different concepts with the notions of "efficiency" and "effectiveness". For the purpose of this report, these variables are defined in the auditors' sense of the word, as indicated above.

It is important to note that, while the approach is referred to as "comprehensive auditing", it does not necessarily infer comprehensiveness in the sense that everything to do with the entity is scoped for examination by the auditors. In some cases, "wall-to-wall auditing" does occur, but cost containment requirements usually result in the auditors applying the components of comprehensive auditing (ie., financial verification, compliance and value for money) to more limited aspects of the entity.

Standing Committee Recommendations

Throughout this report, the standing committee has made a number of recommendations. These are based largely on the findings and recommendations of the Auditor General, as outlined in the tabled report, but in some cases the committee has modified them, based on input received during public hearings. In other cases, the evidence before the standing committee about the territorial health system has resulted in a different conclusion, and the Auditor General's recommendations have not been supported. In the majority of instances, the standing committee has concurred with findings and recommendations included in the report.

The standing committee carefully noted comments made by the Deputy Auditor General of Canada at public hearings on January 6, when he pointed out that:

In our audit, we have no doubt that some stakeholders will have different views from us. This is to be expected. It is not our intention to dictate to the NWT which health care model it should adopt. Yet, there is a need for the groups to talk and try to reach agreement on many of the pressing problems facing your government.

The Standing Committee on Public Accounts is hopeful that this dialogue has been initiated, at least partially, as a result of the public review process surrounding the Auditor General's report. Further, the recommendations brought forward by the standing committee are offered as constructive solutions or strategies for addressing many of the problems identified in the report.

The standing committee will follow up on the status of its recommendations at a later date and will provide the Legislative Assembly with a further report at that time.

Comments On The Management Response To The Audit And Public Review

The Standing Committee on Public Accounts is concerned with certain aspects of the department's response to the Auditor General's report, and also with certain actions that were taken by departmental officials during public hearings.

Management Response To Audit Formal Written Response

The standing committee noted, for instance, that the department's response to many of the Auditor General's recommendations was to simply state "Agreed." While this suggested that the department will be taking steps to implement these recommendations, it did not provide the Legislative Assembly with any detail about how the recommendation would be implemented or when. As such, the nature of the response makes it more difficult to hold the department accountable.

Response During Public Hearings

This was complicated further by opening remarks provided to the Standing Committee on Public Accounts by the deputy minister of Health on the first day of the public hearings. On January 6, 1993, the deputy minister indicated a number of areas in which the department disputed methods or assumptions used by the Auditor General. The standing committee was concerned that the department chose not to indicate these in its formal written management response to the Auditor General's findings but, instead, chose to raise them only during the public review. The end result was that confusion was created about whether the department did, in fact, agree with the recommendations. This, again, has an impact on the ability of the Legislative Assembly to hold the department accountable for implementing the appropriate changes.

In a written submission provided during the January 6 public hearings, the deputy minister of Health indicated that the department had been provided with "short notice" for the preparation of its management response. The Standing Committee on Public Accounts reviewed documentation which indicated that the department had at least a six week period in which to review the draft report and formulate its response. This was considered a sufficient period of notice by the Members of the committee.

The Standing Committee on Public Accounts took issue with a number of the specific statements made by the department in responding generally to the Auditor General's report. The deputy minister indicated repeatedly that many of the deficiencies identified within the report are experienced in other jurisdictions and should therefore be regarded as "common experiences."

The standing committee disagrees. It is not relevant to the people of the Northwest Territories whether other jurisdictions lack efficient systems, good working relations with boards, appropriate management accountability procedures, and other features identified by the Auditor General. The fact that the Department of Health in the Northwest Territories lacks them is a cause for committee concern and for immediate corrective action on the part of the department.

During the deputy minister's January 6 appearance before the standing committee, he also commented that the Auditor General's report was flawed by a failure to consider the larger context in which the department has been operating, and that:

The events of the past year, in particular, provide dramatic evidence of the unique nature of NWT government. More than ever before department activities have been affected by day to day events in the Legislative Assembly.

When asked on January 7 to elaborate, the deputy minister indicated that he had been referring to the replacement of Ministers of Health within the Cabinet. It was his contention that this should have been taken into consideration by the Auditor General as a context in which to view departmental shortcomings.

Again, the standing committee disagrees and expresses concern that the department should take this public position. Regardless of what is happening at the political level, the people of the Northwest Territories should be confident that the department is going to have the systems, expertise and commitment that will enable health services to be delivered consistently. The operational inefficiencies, lack of systems and deficiencies in human resource management that form the majority of the Auditor General's observations should, in fact, have been corrected even during periods of ministerial transition. Events in the Legislative Assembly should not be used as to excuse continuing management problems within departmental divisions.

The deputy minister also commented that many other jurisdictions have been recently embracing primary health care and regional board models similar to those in the Northwest Territories. He stated that:

The senior managers in the Department of Health have many years of experience in the health services field. This experience was acquired in most provinces, both territories and in foreign countries. It is our collective judgement that the NWT has one of the best health services in the world.

The Standing Committee on Public Accounts questions the criteria on which this statement was based. During public hearings, there were many comments from health stakeholders which suggested little agreement for the senior managers' notion that the territorial health system is "one of the best" in the world.

The fact that other jurisdictions may be following directions that have been earlier embarked on by the Northwest Territories suggests that we may have some of the world's best ideas about health care.

But, it does not necessarily follow that we have the best system in place with which to implement those ideas.

And, in fact, much of the evidence placed before the standing committee suggested that the Government of the Northwest Territories may have to follow through on a number of systemic improvements before the senior managers' claim can become regarded as fully credible.

Accuracy Of Information Provided To Public Hearings

Presentation of Information About Organizational Structure

The Standing Committee on Public Accounts was concerned about the manner in which certain information was placed before it during public hearings.

During the January 7 discussion of the Auditor General's findings regarding organizational structure, a departmental official commented on the matter of autonomy for health and hospital boards. He presented a summary of information included in a report received from a board auditor as an example of some of the financial management deficiencies experienced by boards. The contextual connotation was that board operations are inadequate to provide the Financial Management Board and the Standing Committee on Finance with assurances about due regard for efficiency and economy.

Certainly, the single example provided by the official contained many examples of board management shortcomings that might lead one to question whether additional board autonomy could be supported at all. However, when the committee accessed the audit letter referred to, Members were dismayed to learn that it did, in fact, deal with financial information from 1988.

The standing committee subsequently reviewed audit letters for this, and all health and hospital boards since 1988. Although all of them do comment on management deficiencies, there have been none with the number and seriousness of this now outdated example from five years ago. Further, when representatives of the particular board referenced in the audit letter were asked to comment during public hearings, they expressed their opinion that it had been unfair and inaccurate for the department to use this letter as an illustration of board capabilities to take on more independent management functions, as there had been considerable improvement since 1988.

To be clear, the specific issue here is not whether the department identified a specific board. The issue is that the standing committee was provided with outdated information in a manner that appeared intended to reflect on the current management capabilities of all boards. Members of the committee were concerned about this. At the most extreme, it could be seen as providing misleading information to the committee; at the least, it could be seen as undue diligence in choosing appropriate illustrative material.

The Standing Committee on Public Accounts was also concerned about comments made by the deputy minister of Health when discussing matters pertaining to health and hospital boards at the January 6 public hearings. During his opening remarks, he stated that:

... thus, the effective operating period since the signing of the 1988 transfer agreement is considerably less than five years and, during that time, there have been continuing difficulties with the recruitment and retention of important senior positions and boards, notably qualified finance officers. The Inuvik regional health board suffered seven finance officers in one year.

During subsequent public hearings in Inuvik, it was determined that, in fact, the Inuvik regional health board has retained a qualified finance officer since April 1990; the "one year" referred to by the deputy minister was again not reflective of the status quo.

Presentation Of Information About Managing People

The standing committee was also concerned about the quality of information provided during public hearings on January 7 and 8 with respect to the department's completion of a strategy for attracting aboriginal people into the health care professions. Officials were repeatedly unclear during public hearings about whether previous definitive objectives in this area had, in fact, been met. The committee was given the impression, however, that a formal strategy did exist.

The standing committee requested a copy of the strategy and, two weeks later, was provided with a single sheet of paper listing nine projects or activities (see appendix D). There were no implementation dates or standards for completion of the activities. There was no plan for evaluating whether the activities would have a desired impact. The document was dated January 22, 1993, indicating that it had been prepared fourteen days after the committee requested it, even though responses during public hearings inferred that a strategy was already in place and being used.

The Standing Committee on Public Accounts was dismayed that an important objective would be handled in such a manner by the department.

Concern With Aspects Of Departmental Response

In its June, 1992 report to the Legislative Assembly, Committee Report 13-12(2), the Standing Committee on Public Accounts indicated that:

During the hearings, committee Members got the distinct feeling that witnesses did not take the public accounts committee seriously.

By way of this report, the public accounts committee wishes to signal -- loudly and clearly -- that this situation will change. The committee intends to be taken seriously. It has adopted a new philosophy -- one that is much more pro-active in holding managers accountable for their past actions. And, it intends to bring about the kinds of changes that are needed.

The Standing Committee on Public Accounts is of the opinion that government officials should realize the importance of providing accurate, balanced information to the committee and of participating constructively in the accountability process. Within that frame of reference, Members of the standing committee were very concerned with certain aspects of the department's response to the Auditor General's report and to the public review process.

Recommendation 1

Therefore, this committee recommends that the Legislative Assembly express dissatisfaction with the management response made by the Department of Health to the Auditor General's report and with the presentation of:

- information on organizational structure, and

- information on human resource management,

provided during the public review of the report.

Standards For Management Response

The Standing Committee on Public Accounts is aware that the management response to an audit should not be dictated by the auditor nor any committee undertaking a subsequent review. It is, after all, the job of managers to manage.

However, the committee was disappointed with the quality and extent of the information which the Department of Health chose to include in its responses to the Auditor General's report.

It is felt that, in future situations where government departments respond to audit findings and recommendations, they may wish to consider including a more specific and detailed commentary. Where departmental officials have concerns over audit methodology, these should be detailed when responding to recommendations or findings that are seen to be most affected.

Where the department agrees with solutions indicated by the auditor, the management response would be most useful if it included a concise plan for how the solution is to be implemented, when various steps in the process are scheduled, who will take on key responsibility areas and what specific deliverables will result.

When providing information to a public accounts review, government witnesses should ensure that all references and illustrations reflect the current state of affairs ... or else clearly specify why older details are being brought forward. Officials should be prepared to respond accurately to requests for updates about definitive objectives and departmental initiatives, and should represent the current status of projects in a fashion that is consistent with formal documentation.

Organizational Structure

Chapter two of the Auditor General's report includes findings and recommendations which deal with the structure of the health system. During its review, the Standing Committee on Public Accounts focused on two central aspects in this part of the audit: (1) the department's reported working relations with health and hospital boards; and, (2) the organization of certain financial management functions within the Department of Health itself.

Working Relations With Health And Hospital Boards

The Standing Committee on Public Accounts was very concerned with many of the findings reported by the Auditor General with respect to a perceived breakdown in working arrangements between the Department of Health and various boards of management created under the Territorial Hospital Insurance Services Act (see appendix E). As well, both an interim report, Tabled Document 9-12(3), and a final report, Tabled Document 14-12(3), on a review of health and hospital boards conducted by the Standing Committee on Agencies, Boards and Commissions document a wide range of concerns identified from January, 1992 to March, 1993.

There is considerable evidence in all three reports that serious problems exist within the territorial health system with respect to role confusion and conflict between the boards and the Department of Health. They conclude, as well, that there has been too much emphasis placed by the department on "controlling" the activities of boards, rather than "supporting" management and planning decisions made at the regional level.

Role Confusion And Control Issues Lead To Organizational Strain

The Standing Committee on Public Accounts was dismayed, too, by comments made with respect to role confusion between the boards and the Department of Health during public hearings. On January 29, for instance, the president of the Northwest Territories Health Care Association told the standing committee that:

... perhaps our association's main concern over the years has been that there has not been a sufficient delineation of the role of boards and the importance of boards in administering health care in the north. It is our view, and we have expressed this previously, that boards should be given the responsibility, the authority and the appropriate funding to administer the programs for which they are responsible.

Witnesses from the Keewatin regional health board appeared before the standing committee during public hearings on January 25, and commented on several troublesome features in their board's relationship with the Department of Health. The committee took particular note of two statements made during the board's presentation of its formal position:

The (Auditor General's) report outlined that board trustees were not viewed by the Department of Health as capable. This outwardly patronizing view of board trustee capabilities can be seen as an excuse for doing little for helping board trustees improve ... This perpetuates the myth that boards cannot do what they are supposed to do and the department is therefore justified in maintaining controls. It is a catch 22 situation. They do nothing. They do not help boards develop. Therefore, they do not have to give any more control to boards.

and,

We believe that, to some extent, the senior managers of the Department of Health have endeavoured to systematically negate the intent of setting up health boards through an undermining process which was intended to erode the credibility of boards, trustees and senior board managers.

At public hearings on January 28, the chairperson of the Inuvik regional health board likened the relationship between boards and the department to one which might occur between a couple of two year old children, each wanting the same things and pushing each other aggressively to get them.

During the same hearings, the chairperson of the Inuvialuit Regional Corporation added the following comments:

On the organizational structure, it is quite apparent that the confusion that exists on roles and responsibilities arises out of central government bureaucrats not wishing to devolve responsibilities and authorities. However, unless this issue is addressed at the political level, and transmitted and monitored by politicians to civil servants, that the government policy is to decentralize, the situation will never improve.

On the issue of board members, I spoke about the attitude of those within the civil service toward board members. In many cases, it is patronizing. Many people say that it is as if they were extending a courtesy to the board members in the role that they have. We all know that many board members are not health professionals. Because of this, they are seen by the health professionals, in many instances, as not having expertise to make fully informed decisions with respect to health issues. This becomes increasingly obvious when a board member is aboriginal.

Indeed, several other witnesses shared their perception that the Department of Health has been resistant to allow boards to exercise more autonomous roles because of the predominantly aboriginal nature of their membership.

Other witnesses stopped short of making that particular observation, while still acknowledging that overly centralized control measures have resulted in boards feeling as though they may not be trusted or respected by departmental officials.

Many of the comments received during presentations and discussions at the public hearings left Members of the standing committee with a definite feeling of uneasiness and concern about the state of affairs which exists within the territorial health system. Priority should be placed on the clarification of responsibilities and there must be an easing of the tensions between the department and the boards.

Better Definition Of Roles And Responsibilities Is Now In Progress

To some degree, the standing committee was heartened to note that a significant amount of energy is now being devoted to finding appropriate solutions. Very recent steps taken by the Department of Health may be pointing toward a resolution of at least some outstanding difficulties.

During remarks on January 7, officials from the Department of Health stated that:

The department realizes that there have been problems. We are also of the belief that the problems that have been identified are not beyond repair and that working together with our boards, our other colleagues in the department

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and with the Legislative Assembly, we can find consensus on which we can build.

The standing committee took particular note of a recent initiative to establish a "master memorandum of understanding" (MOU) which will formally define roles and responsibilities of the boards and those of the Department of Health. This initiative has been reviewed in detail by the Standing Committee on Agencies, Boards and Commissions in its two recent reports on health and hospital boards, so extensive commentary is not required here.

During the public hearings, Members of the standing committee were encouraged to note that optimism was expressed by the Northwest Territories Health Care Association, several of the health and hospital boards and all departmental officials with respect to seeing a positive outcome from this process. The standing committee wishes the participants well in this endeavour, and will be interested in reviewing their progress at a later date.

During the public review, the standing committee heard differing views on previous attempts by the GNWT to define board models and, specifically, a distinction proposed between "boards of governance" and "boards of management." The Standing Committee on Public Accounts is of the opinion that this model should definitely not be used as a starting point for establishing current roles and responsibilities of health and hospital boards.

Other Positive Developments Are Also Taking Place

The standing committee was also encouraged to note that some observers reported very recent indications that working relations are improving within the health system. Some witnesses representing health boards commented that, over the months leading up to the public review, they had become aware of greater efforts on the part of departmental officials to work together on, rather than to dictate, solutions.

It was even suggested that this positive shift may have been influenced somewhat by attention directed toward departmental operations by the Auditor General and the various standing and special committee reviews. Indeed, in a separate written submission, the Dene Nation noted that:

The report of the Auditor General of Canada has set in motion a process of self-examination and hopeful change in the health professions, institutions, programs and professional associations.

The standing committee found it heartening, as well, to note that, while health stakeholders have expressed concern about the department's organizational position, there is obvious recognition of the level of commitment and professionalism displayed on an individual basis by many of its public servants.

During January 26 public hearings, for instance, a witness representing the Baffin regional health board commented that:

It would be totally unfair to state that the staff of the Department of Health as a whole have not been helpful and are not attempting to continually improve the health care system. It is not always appreciated that there has to be a settling down period after a major transfer, some issues continue unresolved for years.

Similarly, at January 28 public hearings, the chairperson for the Inuvik regional health board took the position that:

The Department of Health -- I will admit to you that I am one of the people who feels the Department of Health stands in our way many times -- has many competent and caring people who work in it. I truly believe that part of our problem is, once again, that their time and energies have never been focused on how to help boards. Right now ... they are struggling with wanting their piece of power as we are struggling with wanting our piece of power. Therefore, that focus has to be clearly outlined and some change of thinking and philosophy has to go on at the departmental level.

The importance of focusing on a "partnership approach" as a means of improving relations was also emphasized by representatives of the Stanton Yellowknife Hospital board of management, who noted that:

... a partnership means that there has to be two people in the decision-making process and two people have to agree with the outcome and that is what we are hoping for. We are hoping for a relationship with the department that is a collaborative one where we can sit down and discuss things ... I think that is the first step that we have to solidify. It is working towards that now. We have a good relationship with the Department of Health. I think we have the trust.

Similar comments suggesting that relations have shown recent improvement were also made by the Kitikmeot regional health board, the Northwest Territories Health Care Association and the Northwest Territories Registered Nurses' Association.

The Standing Committee on Public Accounts regards these remarks as hopeful indicators that positive change may be starting to take place and applauds those who are making it happen. Additional progress can be anticipated through the establishment of the MOU and improved ongoing communication between the department and key health stakeholders.

Reducing Centralized Control

The positive change process will also be helped along by a continuing recognition that health and hospital boards have grown significantly in their ability to manage health facilities, programs and services in the Northwest Territories. Indeed, a motion passed in the Legislative Assembly on March 15, 1993, supported the principle that health and hospital boards should be accepted as the primary agents of health administration.

The Auditor General's report commented that:

The department controls boards by its power over their budgets, by closely monitoring spending, and by requiring financial and administrative reports on board operations.

The department informed us that the tight controls were set up in the early days following transfer when the boards had inadequate financial controls. Although things have improved since then, the department still imposes the tight controls because a directive set up before 1988 has not been amended. In light of the improvements, however, it may be time to reduce the strict application of the original directive.

The department should recognize the improvements made by boards since 1988 and amend the control directive to reflect the needs of the present day. (page 8)

In the department's January, 1993 expansion of its management response, a note was included indicating that the financial controls directive had been reviewed and revised in October, 1992. The Standing Committee on Public Accounts is of the opinion that the review process should be repeated to ensure that policy is consistent with relevant motions passed during the current session of the Legislative Assembly.

Recommendation 2

Therefore, this committee recommends that budget control and financial reporting requirements policies within the Department of Health should be reviewed to ensure that they reflect the improved financial management capabilities of health and hospital boards;

And further that, where necessary, revisions to policy directives should be developed in consultation with health and hospital boards and readied for full implementation by September 30, 1993.

Consolidation Of Financial Functions Within One Division

The Auditor General's report identified areas in which the pooling of financial management functions, currently performed in different divisions of the department could result in potential cost and efficiency savings. (The Auditor General's report provides an overview of three divisions within the Department of Health which could be consolidated, and this has been summarized in appendix F).

Consolidation Of Health Insurance Services Within The Finance And Administration Division

The Auditor General pointed out that consideration might be given to incorporating financial management functions of the health insurance services division within the department's finance and administration division.

The standing committee recognizes that, while both divisions perform functions of a financial nature, the health insurance services division provides a narrower and more specialized role. Further, plans are in place to effect the decentralization of the unit to the Inuvik and Keewatin regions and there is no wish on the part of the standing committee to make recommendations that could complicate this process. Therefore, the standing committee, at this time, does not support the consolidation of health insurance services with the finance and administration division.

However, Members of the Standing Committee on Public Accounts were concerned that the rationale for decentralizing the health insurance services division is unclear. Witnesses appearing during the public hearings were unable to identify any manner in which the location of this division in the regions would actually improve the quality of the service delivered, although economic spin-offs were identified by those representing Rankin Inlet and Inuvik.

Concerns were also raised with respect to the need to ensure that the two regional offices for health insurance services were consistent in their policy and procedure. The Standing Committee on Public Accounts urges the Department of Health to be diligent in formulating clear and consistent policy in this area.

Consolidation Of Hospitals And Health Facilities Within The Finance And Administration Division

The standing committee also considered the potential for consolidating or transferring certain functions currently performed by the hospitals and health facilities division. The standing committee noted that much of the monitoring and budgetary analysis carried out within hospitals and health facilities would be consistent with similar functions in finance and administration. It was felt that there would be definite and specific cost efficiencies if all financial matters surrounding health and hospital boards were administered from a single division.

Specifically, many board representatives pointed out that this would likely reduce the number of demands for specific line by line budgetary information, statistical reports and other administrative details which are currently imposed on board management from headquarters. This was a critical problem identified by all witnesses from health and hospital boards who appeared before the standing committee.

If financial monitoring functions were transferred, it was felt that the hospitals and health facilities division could be transformed into a smaller, but very specialized, consultative unit. It would be able to assist boards with administrative problem-solving and could perform vital networking and planning coordination that is presently lacking.

If the hospitals and health facilities division could be relieved of current financial management and monitoring responsibilities, it was felt that a better focus could be placed on field consultation and on-site support. This need was specifically identified by the president of the Northwest Territories Health Care Association when he appeared before the committee on January 29:

... they simply do not have a real feel for what is going on. They read the numbers. I am not saying they are not in contact with the regions, but I have lived in the north for over eight years, and unless you are constantly going into the communities and have a sense of what is going on, you may as well be in Ottawa. You are not going to have that understanding.

The Standing Committee on Public Accounts is of the opinion that there is much merit in the Auditor General's recommendation with respect to consolidating these administrative areas.

Recommendation 3

Therefore, this committee recommends that the Department of Health transfer responsibilities and resources for financial and budgetary monitoring from its hospitals and health facilities division to its finance and administration division;

And further, that the hospitals and health facilities division be given a mandate to deliver technical and professional consulting services to health and hospital boards through extensive on-site support.

Decentralization Of Mackenzie Regional Health Services

During public hearings, the standing committee heard comments which suggested that the administration offices of Mackenzie regional health services should be transferred to regional locations. It was felt that this could better improve administrative awareness of local issues, establish stronger ties with community leadership and, perhaps, set in motion a process of board development or transfer of health responsibility to other representative entities in the region.

While not specifically included in the Auditor General's report, the standing committee is of the opinion that this suggestion has considerable merit, and urges the Department of Health to study the potential in detail.

Health Insurance Services Regulations

During public hearings on January 29, the standing committee was provided with details of a situation in which the Northwest Territories health insurance program was able to pay only for patient in-hospital treatment, not for home care treatment. This was despite the fact that the latter was considerably less costly. It was pointed out that, if the health insurance regulations had been more comprehensive and less stringent, dollars would have been saved.

The standing committee believes that it would be valuable for the department to conduct a comprehensive review of health insurance regulations and policy to ensure that they are consistent with the growing emphasis on health care through home delivery strategies.

Communication With Boards And Public

The Auditor General's report highlighted a specific need for improved communication with health and hospital boards and with the public at large. This need was supported by several witnesses who appeared before the standing committee.

The proceedings of public hearings held on the Auditor General's report contain several excellent suggestions as to how communication channels can be strengthened between the department and other health stakeholders, and the standing committee commends these to the Department of Health for consideration. It was particularly noted that there is much area for improvement in communication with aboriginal organizations.

The standing committee is of the opinion that the entire health system would benefit if a yearly conference was held which brought together representatives of all health boards. This should be in addition to current regular meetings with board chairs and senior staff. It is believed that this would provide trustees and departmental staff an opportunity to share information and engage in strategy development. It would also serve as an opportunity for information exchange with aboriginal organizations. The standing committee encourages the Department of Health to explore possibilities in this area.

The Auditor General's report notes that a current departmental publication, EPI North, could be used to communicate health information with the public. The standing committee notes, however, that EPI North is targeted toward professionals and would have limited value as a general communication vehicle. Other avenues, such as radio or television programming, should be considered as a means of meeting public health promotion needs.

Planning For The Future

The third chapter of the Auditor General's report notes that the territorial health system is suffering from the absence of a plan to guide health program delivery and expenditures. It describes a "planning to plan" posture, in which several strategic approaches are framed, but not followed through to completion.

The standing committee studied these findings in detail and heard extensive commentary from witnesses on this matter during public hearings. The committee is of the opinion that management within the Department of Health has been too reactive and too crisis oriented. There needs to be a much better framework to define departmental priorities and to guide decisions.

The standing committee is also of the opinion that the absence of adequate strategic planning is contributing to many of the other problems identified in the Auditor General's report. It is the one flaw which impacts on all aspects of departmental administration and board management.

The planning vacuum also appears to contribute to current levels of frustration among health stakeholders, documented earlier in this and other reports. The Auditor General notes that, "Without a plan, NWT health care has no clear sense of where it is going or how to get there." That is a difficult situation for all participants to be in, and gives rise to disputes and a lack of coordination regarding priorities and expenditure decisions.

The standing committee paid particular attention to the Auditor General's comments that:

The present system has not progressed significantly from the old federal system, although circumstances today are different. The department has not developed a strategic plan or clear statements of policy on health resources in the territories. Senior managers have developed only a broad "guiding principles" document and have not set direction. With the tough financial situation at present and the high costs of health care, the need for such a plan is vital. (page 14) Functional Review Of The Department

Regardless of the fact that other planning activities may be under way at the Cabinet level, the Standing Committee on Public Accounts recognizes a need for the Department of Health to complete a functional analysis that was planned to take place before consolidation with the Department of Social Services. This was to include a review of structure, processes and operation within the department itself.

The Auditor General's report identified that the functional review of the department is badly needed in order to establish a base for the mandate and operation of the various divisions within the Department of Health. The Standing Committee on Public Accounts is in full agreement.

Recommendation 4

Therefore, this committee recommends that the Department of Health should complete a functional review quickly and ensure that it considers all headquarters functions.

The NWT Way

Throughout the public review of the Auditor General's report, the Standing Committee on Public Accounts came into contact on several occasions with a set of health service delivery concepts described as "The NWT Way."

The NWT Way was described by the deputy minister of Health as a collective representation of service approaches that have developed over the years in the Northwest Territories and which, "in its current form," is characterized by:

- a broad orientation to health -- recognizing the contributions which can be made outside the health care system to improving the health of the population;

- emphasis on health promotion, health protection and disease prevention in the delivery of health services;

- operation of health services as a system of linked services;

- delegation of responsibility for providing care to socially and technically qualified professionals (not necessarily physicians and dentists);

- involvement of the people in the planning and management of their health services system; and,

- involvement of all ethnic cultural and linguistic groups as providers of training and service.

Throughout the public review, the standing committee noted considerable confusion in all quarters with respect to The NWT Way. Questions were raised as to how these principles were identified, who had framed them in this form, and under what authority this was done. There was also uncertainty about how The NWT Way was to be used -- the department made it clear that this was not a plan in itself, but Members of the committee and others were somewhat perplexed about exactly what functions it was supposed to serve.

The standing committee noted that there is no single document which outlines exactly what The NWT Way is or how it should be used. At least four different descriptions have been released to the public (see appendix G).

However, it should be noted that each of these accounts differ. There is little understanding of the process through which modifications in The NWT Way are identified, vetted and made. Throughout public hearings, witnesses representing a range of health stakeholders were each asked whether they had been requested for formal input on The NWT Way by the Department of Health. Almost without exception, they indicated that they had not had any opportunity to participate in its formulation. Further, they indicated considerable confusion about its implications on their mandate, even though the vast majority believed that the basic ideas were not difficult to support.

In some cases, processes surrounding The NWT Way are resulting in frustration and mistrust. During January 25 public hearings in Rankin Inlet, the Keewatin Regional health board took the position that:

They have developed a new and improved version of The NWT Way of health delivery that still has to be sanctioned by the people of the Northwest Territories. There has been no consultation process put in place to gather input from the people, especially in the regions. Aboriginal organizations, stakeholders in this system and consumers have not been consulted about this new system. To this end, we believe that the model for delivery of health care services in the NWT should be called "The Department of Health Way."

In many ways, it is unfortunate that current processes have left the department's work in this area open to questioning and criticism. Although the Standing Committee on Public Accounts is not in a position to review the substantive content of The NWT Way -- even if it could find a definitive account -- Members regard most of the statements surrounding the concept to be very easy to support.

The Standing Committee is concerned that, in its current level of development, though, The NWT Way concept is being misunderstood and is confusing the health planning process. The Department of Health should either develop the concept fully, indicating operational implications and a formal process for receiving community and stakeholder input ... or it should refrain from referring to it in public communications. The Standing Committee on Public Accounts believes that, of these two options, the former is certainly to be preferred.

Recommendation 5

Therefore, this committee recommends that the Department of Health prepare and, when necessary, regularly update a document which formally defines the rationale, purpose and substance of The NWT Way for health delivery;

And further, that the Department of Health develop a process through which stakeholder organizations and others can provide input to the ongoing formulation of this approach .

A Strategic Plan For The Health System

The Auditor General's report made it abundantly clear that immediate attention must be given to the development of a plan which specifically lays out the principles, goals, objectives, priorities and strategies through which health services should be delivered in the Northwest Territories. Currently, virtually all the health and hospital boards have been active in some aspect of facilities or service delivery planning. The territorial plan should provide an "umbrella framework" which defines how these regionally-driven strategies can be developed and implemented on a coordinated basis.

The Standing Committee on Public Accounts does not wish to provide commentary, at the present time, as to the specific substance of the plan. This is because Members believe that the content of the plan should be developed through consultation with health and hospital boards, aboriginal organizations and other stakeholder organizations.

The standing committee is also of the opinion, however, that a high priority should be placed on completing this planning exercise within the current fiscal year, at least to a point where it can be discussed before 1994-1995 appropriations are considered.

Recommendation 6

Therefore, this committee recommends that the Department of Health prepare, in consultation with health/hospital boards, aboriginal organizations and other health stakeholder groups, a plan for the ongoing administration and delivery of health services in the Northwest Territories;

And further, that a draft version of the plan should be brought forward no later than December 31, 1993.

Nursing Workload Assessment

The Auditor General also indicated that, in order to make the best use of limited resources, the Department of Health needs to analyze the causes of illness and death and match the allocation of its health staff accordingly. The Baffin and Keewatin regional health boards, as well as the Dene Nation made comments during public hearings which paralleled those in the report.

The Auditor General observed that only around 40 per cent of nursing personnel are stationed in community settings, while the majority are based at hospitals in the major centres. The report suggests that this may be an inappropriate distribution of nursing resources and that it can be related back to the department's lack of strategic planning. Insufficient allocation of human resources to the community level can result in stress and poor morale for nurses who are trying to fill a difficult role.

The Keewatin regional health board suggested that problems with resource distribution are regionally-related and also extend beyond the allocation of nursing resources:

The department admits that the system of health care they help set up and support is inequitable. The western Arctic has 62 per cent of the population, five out of six

hospitals, 86 per cent of the doctors and 70 per cent of the nurses.

The department has been operating the delivery of health services in a vacuum ... If they had a strategic plan in place, they would have been able to anticipate the various environmental factors and the internal and external ones that impact on their ability to achieve their mandate.

The Auditor General's report commented that increasing administrative duties in community health centres have often made it difficult for nurses to concentrate on primary health delivery, a position that was strongly supported by the Northwest Territories Medical Association.

Concern was also expressed by the Baffin regional health board that community-based nursing resources have been stretched even further by increased emphasis on health promotion and health education. Witnesses representing the Kitikmeot Regional Health Board pointed out that this pressure has been lessened by the welcome development of the community health representative program.

In reviewing all these positions, the standing committee was left with the understanding that there simply has been insufficient attention to planning and evaluating the distribution of human resources within the health system.

The Auditor General documents the fact that the nursing services division within the Department of Health proposed an assessment of nurses' work loads some time ago. Unfortunately, this initiative stalled due to staff shortages.

The Standing Committee on Public Accounts is of the opinion that the department should revitalize its efforts to implement this important study. Although realizing that the development of work load assessment tools and standards is difficult, the Committee was encouraged to note that the department has agreed to attempt to proceed with this initiative.

During public hearings on January 29, witnesses representing the Northwest Territories Registered Nurses' Association commented that this would be a major challenge:

There are workload measurement tools for hospital nurses that have been developed that are used quite extensively. There are very few community health indicators to say, "How many points in terms of workload do you give to a school visit, talking to the children, versus how many points do you give to someone with a broken leg at the health centre and how many people are required to carry out the care?"

... In a sense, what they have been asked or mandated to do is pioneer work for probably the world.

While encouraging the department to take on this challenge, the standing committee would note that resources do appear to exist within the Northwest Territories Registered Nurses' Association and that important perspectives on community work load can be provided by the health and hospital boards. The development of work load assessment tools, standards and procedures should proceed as a partnership between the Department of Health and these stakeholder groups.

Recommendation 7

Therefore, this committee recommends that the Department of Health accord a high priority to the development of work load assessment instruments and procedures applicable to nurses in the Northwest Territories;

And further, the Department of Health, in consultation with the NWT Registered Nurses' Association and other stakeholders, should carry out work load assessment studies which enable better planning for the allocation of nursing resources.

Policy Harmonization Regarding Private Medical Clinics

The Auditor General's report included a comment that, in the absence of a master health care plan, policies are working at cross purposes. It indicated that the department had seen no observable health benefit from a private clinic in Inuvik and was, in fact, concerned that the delivery system could be damaged by public expectations for costly doctors' services when nurse practitioners would suffice.

However, witnesses representing the Inuvik medical clinic challenged these findings during January 27 public hearings by arguing that:

... this is a flagrant misrepresentation of the Inuvik medical clinic and the people within this region ... Before the clinic came into existence, the hospital recruited approximately 360 physicians in a ten year period. In the six years since the Inuvik medical clinic has been in operation, there have been approximately 25 positions hired.

This issue was also raised in the written submission received from the Northwest Territories Medical Association:

The statement is inappropriate because it makes unsubstantiated assumptions concerning the roles of physicians and nurse practitioners and the relative cost of each type of primary health care. In order to address this issue, there has to be ongoing consultation between all stakeholders. We agree that costs of health care have to be controlled. Government has to remember that private practitioners have overhead costs to meet. Private enterprise promotes fiscal responsibility.

The Auditor General recommended that policies should eventually be developed to ensure that private clinics do not result in higher than acceptable payments for health care. However, the standing committee was mindful that these same clinics have made it possible for elders and other patients in some northern communities to not have to endure seeing a different doctor upon each examination. A better approach is to encourage departmental stakeholders to work toward a better understanding of, and more coordination between, the roles of physicians and nurse practitioners. At the present time, the Standing Committee on Public Accounts does not support the Auditor General's recommendation in this regard.

Managing People

The Standing Committee on Public Accounts also reviewed observations and recommendations in chapter four of the Auditor General's report, which dealt with issues surrounding human resource management in the Department of Health.

Aboriginal Employees In The Health System

The standing committee was dismayed and concerned to see that levels of aboriginal employees in the health system remain so clearly unrepresentative of the ethnic distribution of the population. The Auditor General reported that "the department has not significantly increased aboriginal involvement in health care delivery, although this is a policy objective. (page 21)

The low level of aboriginal representation in the health system was confirmed by figures supplied by the deputy minister of Personnel at a briefing on January 30, 1993. At that time, Members of the standing committee were informed that:

At the headquarters level, they have about 11 per cent of their organization who are aboriginal. In the health boards, there are about 38.7 per cent. That is a low of 34.2 per cent in Inuvik and about 50 per cent in the Kitikmeot region.

The Standing Committee on Public Accounts was not only concerned about the over-all low number of aboriginal public servants participating in the health system, but also noted that most were employed in support functions. The department, and incidentally most health and hospital boards, have not succeeded in opening the door to management decision-making or health planning for aboriginal people of the Northwest Territories. The standing committee found a striking illustration of this fact during the public hearings. Of all the senior managers and middle-management officers who appeared as witnesses during the hearings ... not one of them was of aboriginal descent.

This is an area of serious concern for the Standing Committee on Public Accounts. To have a headquarters complement of 11 per cent aboriginal employees within the Department of Health is absolutely unacceptable and requires immediate attention on the part of the Minister and the Executive Council.

While the Auditor General's findings in this respect were already troubling, the standing committee became even more concerned upon reviewing both the tone and the substance of the management response provided by the Department of Health. While acknowledging that the department is "concerned" about aboriginal hiring, the management response also went took the position that:

... the matter is more complex than simply the distribution of training dollars and it requires concerted effort to increase the number of high school graduates in the N.W.T. (page 20)

Throughout the hearings, a similar message was provided by the Department of Health that this apparent lack of success cannot be effectively dealt with because there is a shortage of aboriginal people who have been trained in professional health careers. The Standing Committee on Public Accounts takes issue with this position.

Aboriginal Access To Health Professions

Undeniably, many careers in health disciplines are sophisticated and require several years of intensive training. When more aboriginal people achieve advanced educational goals in this area, affirmative action policies of this government will assist them in finding employment.

But, the pursuit of health care professions by northern aboriginal people will not happen on its own. For too long, there has been a sense that this field is the domain of physicians, nurses and other health professionals trained elsewhere. Many young people in the smaller communities are not familiar with the opportunities for career advancement which exist in the health professions.

Members of the standing committee are of the opinion that the Department of Health has not taken a proactive approach to ensuring that the health bureaucracy becomes representative of the cultural and ethnic background of the people it serves. The Standing Committee on Public Accounts believes strongly that it is not enough to "sit back" and wait for the educational system to prepare aboriginal graduates.

Instead, if there is an inadequate supply of trained aboriginal health workers, the department should be increasing the demand for them. This should be accomplished through an aggressive approach to promoting health care occupations and career education.

The standing committee agreed with a model proposed by Mr. Jim Antoine (MLA, Nahendeh) who provided input to the public hearings on January 29, 1993. The Department of Health needs to change its approach to promoting health careers for aboriginal people. It should be going out into the communities to identify people who are interested in health. These could be youth, elders or adults who may already be working in a health support role. The department needs to develop individualized training programs which give them access to the courses and support they need to assist in broadening the skills and knowledge they already have. There can be an increase in the number of aboriginal people in the health system, but it will not happen unless a more positive and proactive approach is developed by the Department of Health.

The standing committee was concerned with the approach that has been taken to increasing aboriginal employment in the health field. Evidence before the committee during public hearings demonstrated only a series of isolated initiatives or projects, with little or no overall planning as to how they were supposed to fit together (see appendix D). Of greater concern was the fact that none of the specific initiatives had evaluation criteria which would enable the department to determine whether its career promotion activities had actually made a difference.

Development Of A Strategy For Attracting Aboriginal Health Professionals

In many ways, the Standing Committee on Public Accounts was concerned that the human resource management division within the Department of Health has not been equal to the task which must be accomplished. Although there has been some positive response to the preparation of an information book about health careers, this should not be seen as sufficient in itself.

The human resource management division has proposed an increased involvement in school fairs, science fairs and presentations in schools. This is commendable. However, the Standing Committee on Public Accounts noted that other stakeholder organizations, including the health and hospital boards, the Northwest Territories Registered Nurses' Association and the Union of Northern Workers have also been involved in some elements of career awareness programming. There seems to be relatively little planning and coordination between the various participants in this area, a responsibility that should be assumed by the department's human resource management professionals.

The standing committee noted the lack of a systematic approach to planning and evaluating other initiatives, including those dealing with health career awareness materials in elementary schools, with post-secondary student summer hiring and with media presentations.

The standing committee was concerned during public hearings, as well, that progress toward the development of a nursing education program in the Northwest Territories had been slow. In the opinion of the committee, the development of nursing education within our own jurisdiction can be expected to have a very significant impact on the accessibility of aboriginal people to health careers. Members of the standing committee applaud the March 8, 1993 announcement by the Minister of Education, Culture and Employment Programs, Minister's Statement 50-12(3), that a nursing diploma program will commence this September. Recognizing that this has been an acknowledged need for many years, however, the standing committee wonders why it has taken this long for the program to finally be developed. The Northwest Territories Registered Nurses' Association pointed out during the January 29 public hearings that:

It has been talked about for three or four years, but the association, and the people who are participating in this, have just very recently been given the go ahead to start working on it. Without the commitment from the government, we could not start. It was like having our hands held back.

Clearly, human resource development initiatives have suffered from a lack of strategic planning, just like other areas of the health system. The Standing Committee on Public Accounts is disconcerted by this lack of progress, particularly since the department has obviously recognized the need for strategy development in this area and established definitive objectives during 1991-92 and 1992-93. These objectives have still not been met satisfactorily today.

If the Department of Health is going to be successful at increasing the number of aboriginal people working in health careers, it will need to work with other stakeholder groups to build a strategy framework. The health and hospital boards, nursing and medical associations, and aboriginal organizations will need to be participants in this process.

The Standing Committee on Public Accounts is of the opinion that strategic planning in this area should be regarded as a priority by the Department of Health.

Recommendation 8

Therefore, this committee recommends that the Department of Health develop an appropriate strategy for attracting and supporting aboriginal people who want to enter the health professions;

And further, that the Minister of Health table a complete strategy document in the Legislative Assembly by the fall session in 1993.

Aboriginal Access To Careers In Health Administration

The Standing Committee on Public Accounts is also of the opinion that career opportunities in the area of health administration should not be overlooked as well. The standing committee is aware that many Northerners have now undertaken studies in business and public administration programs in post-secondary institutions within and outside the Northwest Territories. In addition, considerable progress has been made by Northwest Territories accounting associations in promoting the accreditation of aboriginals as professional accountants.

With these workforce developments, it was somewhat mystifying to Members of the standing committee that there are so few aboriginal people working in health administration positions.

The standing committee is of the opinion that more progress should be made in attracting aboriginal personnel trained in management, accounting and administrative decision-making into the health bureaucracy. Again, this will require a coordinated plan, based on consultation with training institutes, health and hospital boards, aboriginal organizations and the Department of Personnel. The Standing Committee on Public Accounts is of the opinion that work in this area should not be delayed.

Recommendation 9

Therefore, this committee recommends that the Department of Health develop a strategy for attracting and supporting aboriginal people who want to enter the field of health administration;

And further, that the Minister of Health table a complete strategy document in the Legislative Assembly by the fall session in 1993.

Affirmative Action Planning

The Auditor General's report noted that:

To increase aboriginal involvement in the health care system requires a dedicated effort to hire, orient, train and develop aboriginal staff to maximize their retention in the system. The philosophy behind employment equity or affirmative action is to develop a public service that represents the population it serves.

We examined the Department's and boards' affirmative action efforts towards aboriginal representation and noted that the department in Yellowknife submitted its first and only plan in 1989 and has not updated targets since then. (page 21)

The standing committee was concerned that the organizational commitment to aboriginal hiring within the Department of Health has been much less than should be expected. This was echoed by several of the aboriginal organizations and regional health boards which appeared during public hearings.

To be fair, the individual departmental officials who appeared before the standing committee did indicate an awareness of the aboriginal hiring record and appeared very genuine in their interest to see improvements in this area. It should also be noted that the Department of Health has been quite successful in hiring staff who qualify in other categories of the affirmative action policy and, in fact, should be a model for other government departments in terms of the number of female employees in non-traditional senior management positions. Regrettably, this observation was not included in the Auditor General's report.

What seems to be missing is a framework to guide decisions and facilitate ongoing evaluation of aboriginal hiring efforts. The standing committee agrees with the Auditor General's recommendation that the department should "revitalize" its affirmative action plan to recruit and retain aboriginal employees. Where identified as a priority by health and hospital boards, the department should also assist them in such an exercise, as well.

Recommendation 10

Therefore, this committee recommends that the Department of Health prepare a comprehensive affirmative action plan;

And further, that the department assist health or hospital boards of management to prepare comprehensive affirmative action plans, where requested.

Funding And Support For Students In Health Disciplines

Health Bursary Program And Student Funding

The Auditor General's report commented on the $35,000 (in 1991-92) health bursary program, noting that very little of the bursary funding has been directed to aboriginal people. The Standing Committee on Public Accounts requested updates and more specific information on the health bursary program from the Department of Health during public hearings on January 7, 1993 (see Appendix H). The standing committee noted that, of the 119 bursaries awarded since 1987-88, only thirteen have been to aboriginal applicants.

This was a source of concern to Members of the standing committee. The point was raised, both in the department's management response and during public hearings, that the Department of Education, Culture and Employment Programs "provides extensive funding to aboriginal students." Departmental officials also clarified that, contrary to one of the findings in the Auditor General's report, eligible applicants were denied bursary funding only if they were able to secure support from other sources. Further data supplied by the deputy minister of Education, Culture and Employment Programs during his very helpful briefing on January 30, 1993 showed funding trends in student financial assistance (see Appendix I).

Presently, there are forty Northwest Territories residents enrolled in post-secondary programs in health or related studies, according to the Department of Education, Culture and Employment Programs (see Appendix J). Of these, aboriginal people constitute a little less than one third.

Neither the Auditor General nor the standing committee were in the best position to indicate whether total amounts of financial assistance have been adequate to meet the needs of students wishing to pursue their studies in the health professions. However, the standing committee was aware that many northerners have reported having a difficult time supporting their educational activities, particularly since student employment has become more scarce.

The standing committee is of the opinion that the matter of financial assistance for students in health care disciplines should be evaluated to determine whether it is at adequate levels to allow aboriginal people and other northerners to pursue studies in this area.

Recommendation 11

Therefore, this committee recommends that the Department of Health, in consultation with the Department of Education, Culture and Employment Programs, review sources, eligibility criteria and amounts of financial assistance available to students wishing to pursue studies in health professions or health administration;

And further, that the departments survey current students enrolled in health-related disciplines to determine the adequacy of available financial assistance, and include survey results in the report.

Cross-Cultural Awareness And Sensitivity

The Standing Committee on Public Accounts received evidence during public hearings that there is a general perception that many of the staff who work in the health system are insufficiently attuned to the cultural background of the people who form their clientele. The committee agreed with the Auditor General's observations that, often, it appears that hiring decisions are based more on the technical competence of the individual than with whether the person is capable of adapting to life in northern Canada.

In general, the standing committee recognized that a need exists for more intensive cross-cultural orientation of headquarters personnel, as well as the field staff who work for health and hospital boards. Some witnesses also expressed the view that it is the senior management of the department that is in greatest need of staff training and support in this area.

It would not be the desire of the standing committee to dictate the content of such training initiatives. However, the committee was of the opinion that some excellent suggestions were provided by the various aboriginal organizations and appear in the proceedings. The department should supplement these by further consulting with the aboriginal organizations and the health and hospital boards.

The Standing Committee is of the opinion that, to a very large degree, cultural orientation resources do exist in the Northwest Territories and should be available without massive expenditures for consultants, trainers and duty travel. The standing committee strongly suggests that the department should seek the advice of aboriginal organizations and regional councils as to the availability and organization of cross-cultural orientation and training.

Recommendation 12

Therefore, this committee recommends the Department of Health establish a plan which provides an effective cross-cultural orientation and training program for newly hired staff;

And further, that for all departmental personnel, individual training plans within the performance review and planning process should include a requirement for cross-cultural awareness training at least every fifth year;

And further, that senior managers within the Department of Health provide a model for other employees by each participating in a program of cross-cultural awareness prior to December 31, 1993.

Exit Interviews

The Standing Committee on Public Accounts noted the Auditor General's comments that, in many cases, the reasons for staff departure from the Northwest Territories health system have been unknown. The Auditor General indicated that exit interviews should be carried out on departing staff.

The standing committee is of the opinion that it is important for the Department of Health to begin taking this approach for a number of reasons. Exit interview data can assist in identifying problem areas within the personnel management sections of the department, and can allow better evaluation of human resource management strategies. The standing committee was mindful of input from the Union of Northern Workers that exit interview procedures sometimes result in employees saying what they believe management wants them to. However, the committee feels that this could be avoided if exit interviewers received a careful orientation and the process was carried out in an atmosphere of trust and respect.

Recommendation 13

Therefore, this Committee recommends that the Department of Health implement a system of exit interviews for all departing staff no later than October 1, 1993;

And further, that the department encourage and support health and hospital boards to implement similar procedures.

Performance Appraisal Systems

The Standing Committee on Public Accounts noted the Auditor General's findings that the Department of Health has made inadequate use of the performance review and planning process. It was reported that the department has completed only 43 per cent of the performance appraisals required, while health and hospital boards had averaged only 29 per cent completion. The standing committee believes strongly that the monitoring of staff performance is an important function of departmental supervisors and that the performance review and planning process must be kept up to date to be useful.

The standing committee heard differing perspectives on the apparent failure of the health department to meet necessary performance appraisal requirements. A witness from the Union of Northern Workers pointed out, during public hearings on January 29 that:

The audit indicates that, while the system is in place, it is not being accessed by the people responsible to use it ... I do not think that it is necessarily a problem with the system. As we indicated, there has to be proper training in how to do a performance appraisal on an employee and to ensure that it is kept up to date and accurate.

On the other hand, during the January 30 briefing sessions, the deputy minister of Personnel noted that:

It may be a combination of the department not taking the time to complete the performance reviews and also the fact that the existing system is set up as a management by objectives system. It is really structured more for management than it is for jobs at the entry levels and in between.

The Standing Committee on Public Accounts accepts that the system may need some revision to better reflect the need to monitor performance of service delivery and other personnel. The committee urges the Department of Health, the Department of Personnel and the Union of Northern Workers to discuss this area. It should also be noted that the standing committee is fully aware that the matter of incomplete performance review is very likely not unique to the Department of Health. Committee Members were concerned that there may be insufficient attention to staff performance appraisals throughout most government departments. It is a little unfortunate that the Department of Health is singled out alone at this time, and perhaps the Department of Personnel should consider a comprehensive review of problems in other departments as well.

However, at the same time, the completion rate for performance appraisals within this particular department has been so inadequate that it does strongly suggests the need for immediate and significant action. Perhaps this will provide the Department of Health with an opportunity to model approaches to correcting the problem that can be adopted elsewhere in government.

Recommendation 14

Therefore, this committee recommends that all supervisors within the department complete in-service training in the use of the GNWT performance review and planning system for staff appraisal no later than April 1, 1994.

Performance Standards For Doctors

The standing committee took careful note of the Auditor General's comments on the need for systems which allow the evaluation of physician performance. Inconsistency was observed in the treatment of salaried doctors, potential conflict of interest considerations were raised, and the performance standards were absent from most physicians' contracts.

At the same time, the standing committee also took into account the positions expressed by witnesses representing the Inuvik Medical Clinic and a written submission received from the Northwest Territories Medical Association. Both pointed out that the matter requires more intensive study than has been heretofore provided. It may be that this issue points out the need for the establishment of a college of physicians and surgeons in the Northwest Territories.

At this point, the Standing Committee on Public Accounts is unprepared to make a recommendation on the Auditor General's findings in this area. However, it is seen as a critical issue which the Minister and Department of Health are strongly urged to address. Certainly, the importance of providing additional structure for the government's working arrangements with physicians is underscored by the illustrations in the Auditor General's report, and it is hoped that it will be possible at the earliest opportunity for the Department of Health to address the matter formally with the Northwest Territories Medical Association. If a consultation process is established, it may also be useful to involve the Northwest Territories Health Care Association, to ensure that the views of health and hospital boards are represented, as well.

Recruitment Function Of The Human Resource Management Division

The Auditor General's report recommended that the department should consider the desirability of eliminating the recruitment function from the human resource management division within the Department of Health.

During the public review, the Standing Committee on Public Accounts heard evidence from witnesses representing several organizations that the function provided by this division in terms of general advertising and promotion of northern health careers is very valuable. In particular, the committee noted the comments made by representatives of the Kitikmeot regional health board, during the January 27 public hearings, that:

From our board's perspective, and we have a very slim administrative staff, if we did not have that position in Yellowknife doing a major portion of the nurse recruitment review and summarizing, we would be in a real bind in trying to get staff at this point. We do not have the resources to put the time into the job which is done by that person. I know there are some other boards which use this position extensively, but for us, this is a key role to changing a lot of the ideas of who can deliver different types of health care, how to recruit and how to develop training systems for health people within the Northwest Territories.

At the present time, the Standing Committee on Public Accounts is not prepared to support the recommendation of the Auditor General in this regard.

Managing Information

The fifth chapter of the Auditor General's report deals with the management of information within the Department of Health. This was an area considered by the Standing Committee on Public Accounts during its public review of the comprehensive audit.

The Auditor General's report comments that:

Information is both a resource and a tool to make informed decisions. Managers must have information that meets several criteria including usefulness, comparability, accuracy, accessibility and timeliness, as well as being responsive to changing requirement. How managers use the information is equally important.

The Standing Committee found that comments encountered during the public hearings were very consistent with the Auditor General's reported findings. Serious attention needs to be given to the way in which information is collected, classified, stored and used within the Department of Health.

Research Information

The Standing Committee on Public Accounts noted the Auditor General's concerns regarding the relevance and coordination of much of the health research currently being carried out by investigators from outside the Northwest Territories. The report recommends the development of a focused health research policy to ensure participation, relevance to regional needs, and action on results of these studies.

North Of 60 Health Research Program

The standing committee is of the opinion that before policy can be formulated in this area, details need to be clarified about the current status of health research. One element should be a review of the current North of 60 research funding program. This is an initiative of the federal national health research and development program (NHRDP) of Health and Welfare Canada. Both the Department of Health and the Northwest Territories Science Institute are involved in program administration. Funding under this program is to be allocated according to priorities established through extensive community consultation and outlined in a June 1989 report (Tabled Document 27-89(2)).

Recommendation 15

Therefore, this committee recommends that the Department of Health, in consultation with the Northwest Territories Science Institute, prepare a comprehensive report on the North of 60 research program;

And further, that this report should include an analysis of whether funding criteria identified in June, 1989 have been met;

And further, that this report should clearly indicate the respective responsibilities of the Department of Health, the Science Institute and NDRDP;

And further, that this report should be brought to the Legislative Assembly by the fall session in 1993.

Research Activity Within The Department Of Health

In addition to policy relating to studies carried out by research investigators who are external to the department, the standing committee is of the opinion that policy should also be developed to provide a framework for any health research undertaken within the department itself.

The Auditor General stated that, "... the department has no research resources of its own and research data are poorly managed" (page 29). During hearings on January 8, exception was taken to this by the deputy minister of Health, who pointed out that:

True, the department has no fixed laboratory research resources. However, it undertakes various research efforts into various issues and quite often with existing staff. The department has been actively involved with and has liaised on a regular basis with the Science Institute of the Northwest Territories.

Recommendation 16

Therefore, this committee recommends that the Department of Health prepare a document which:

1. Summarizes health research studies carried out within the department since 1988; and,

2. Proposed policy parameters for the design, approval, ethical standards, consultation, local involvement and report distribution of future health research studies within the department.

Data Processing Systems

The standing committee also noted that serious concerns were expressed with regard to data processing systems in the Department of Health. A consideration of these soon opened the door to a confusing array of acronyms and purposes.

Generally, though, most of the committee's focus in this area was drawn to the health insurance services system (HIS), which records and processes bills received for various medical services -- and on the community health management information system (CHMIS), which records statistics showing the kinds of medical treatment or other services provided through community health centres. Both systems were seen to have their own specific operational flaws and cannot merge their data with each other. The Auditor General's report noted that this has resulted in certain cost inefficiencies, data entry error and an insufficient information base for planning. This was further supported by witnesses representing almost all of the health boards and in the written submission received from the Northwest Territories Medical Association.

The Standing Committee on Public Accounts is of the opinion that attention needs to be paid to system shortcomings.

Recommendation 17

Therefore, this committee recommends that the Department of Health implement measures to:

- improve the flexibility and usefulness of the HIS system;

- review and modify procedures for completion of HIS system claim forms and code compatibility; and,

- develop a single reporting format for HIS and CHMIS by April 1, 1994.

Registration Tracking Procedures

The Auditor General's report expressed concern over observations that people are taking advantage of health insurance funding in the Northwest Territories. It noted that:

Health care for NWT residents is free, but some other provinces charge a fee, making it desirable for ex-NWT residents to keep their membership. Even if residents try to move out of the NWT, they may try to use their NWT health care membership so that they get free benefits of NWT coverage. (page 31)

Several Members of the standing committee were already aware of this problem and there was considerable concern over the out-flow of dollars through inappropriate registration. A need was identified to implement system changes that will allow better tracking of health care registration.

During the public hearings on January 8, the committee was encouraged to see that the department is already working on solutions. A number of promising options were discussed with senior officials from the department's health insurance services division. The standing committee is of the opinion that better policy development is needed in this area and should be regarded as a priority.

Recommendation 18

Therefore, this committee recommends that the Department of Health improve registration tracking procedures to ensure that, as people leave the Northwest Territories, their eligibility for territorial health insurance ceases.

Reciprocal Billings

The standing committee is concerned that the Northwest Territories is losing dollars through the way in which claims are made when medicare and hospital services are performed on northern residents in other provinces. The Auditor General estimated that approximately $84,000 is lost each year through over-payments that are made to other provinces.

The Auditor General reported that GNWT agreements with other provinces are often outdated and that some cannot even be located. The Standing Committee on Public Accounts believes that this is an administrative area which could be tightened considerably.

Recommendation 19

Therefore, this committee recommends that all territorial-provincial agreements relating to reciprocal medical billings should be reviewed and updated during the next renewal period for each one;

And further, that the department should ensure that copies of all agreements are on file by June 30, 1993.

Recommendation 20

Information Sharing

The Auditor General's report raises concerns about the degree to which participants in one component of the health system are familiar with what those in other components are doing, particularly in terms of policy set by health and hospital boards.

Of particular concern was the fact that boards are not able to easily access each other's operating and administrative policies. The standing committee is of the opinion that the central health library and resource centre in Yellowknife could assist by adding a collection of board policy documents to its holdings.

Recommendation 21

Therefore, this committee recommends that the Department of Health develop, within the Otto Schaeffer health resource centre, a repository of all current policy and procedures established by health and hospital boards, to facilitate sharing of information between boards and within the department.

The Standing Committee on Public Accounts is also of the opinion that systems should not only ensure that information is generated but also that it is available for use. Managers should be familiar with other areas of operation. This opens career development pathways, improves staff morale and reduces administrative costs during periods of staff displacement.

Recommendation 22

This committee also recommends that the Department of Health develop a process through which senior managers become familiar with activities and mandates of other divisions or with board administration, including, where appropriate, the temporary rotation of officials.

Health Policy And Legislation

The Auditor General's report concluded that the department is not making good use of its policy and legislation division. However, Members of the committee are also concerned that these comments may leave one with an incomplete perception of the division's total contribution to the department and to the territorial health system.

The committee took note of the January 8 comments by the deputy minister of Health that, "the division has been extremely busy over the last few years updating existing polices, legislation and working on new policies", and agrees that the amount of effort required on each of these initiatives is extensive. Further, the standing committee is aware that, in a department which has tended to operate in a reactive mode, much of the responsibility for responding to "crises" has fallen on this division. Health policy and legislation personnel are active in preparing information for the department's response to issues raised in the Legislative Assembly and in public.

As noted by the Auditor General, however, the role for the Policy and Legislation division would be enhanced if it were allowed to develop a more proactive approach to working with boards and other government departments, rather than spending so much time "responding" to events and circumstances.

Recommendation 23

Therefore, this committee recommends that the Department of Health develop a new mandate for the policy and legislation division, emphasizing:

1. Responsibility for tactical and strategic planning; and,

2. Ongoing legislative and policy review.

Board Accounting Systems

The Standing Committee on Public Accounts was extremely concerned to discover the state of affairs which exists with respect to accounting systems used by health and hospital boards, and with the approach to decision-making that has been used by the Departments of Health and Finance when dealing with board accounting requirements.

Members of the committee found it incredible to note that the boards are having to use incompatible accounting packages and that there is no standardized chart of accounts. This has necessitated the development of procedures at the board level for reprocessing data, which adds to administrative costs, increases error rate potential, and frustrates finance managers.

The president of the Northwest Territories Health Care Association commented, during January 29 public hearings:

That is one of the difficulties that we have had over the years. Health has essentially taken the position that you cannot run your operations responsibly, yet we do not have the information to be able to make the decisions that are necessary ... I understand that steps are slowly being taken to remedy the situation. That is something that I do not think we can emphasize strongly enough. If the situation is going to improve, or if boards are going to be able to manage responsibly and efficiently, there has to be a common information system that is able to gather and collect information and present it in a way that is usable and effective.

Departmental Demands For Financial Information

To a large degree, these shortcomings in information processing have contributed to the repeated time-consuming demands for information which health and hospital boards receive on a regular basis from the Department of Health. With an efficient and standardized accounting system, it would become possible for the department to access information about board operations electronically, without imposing extra reporting requirements on board management.

Inadequate Consultation With Boards

Several health and hospital board representatives noted extreme dissatisfaction with the manner in which the department made decisions respecting the choice of accounting system. The Inuvik, Keewatin and Kitikmeot regional health boards, and Mackenzie regional health services, all now use the health board information system (HBIS). Witnesses told the standing committee that the selection of this system was made without an assessment of board accounting needs and despite serious concerns that were identified by the boards. Boards felt as though the decision to use HBIS as an accounting system was imposed on them, rather than implemented as a collaborative venture.

This was not the approach that should have been used. The chairperson for the Keewatin regional health board noted, during January 25 public hearings, that:

"We believe that the Department of Health, in cooperation with the boards, should analyze the available systems, as well as other potential systems, and see which one best suits the overall needs."

Review Process Is In Place

The standing committee was encouraged to find out that this, in fact, has started and that a working-group composed of departmental and board representatives has been attempting to review board accounting needs and identify systems alternatives. The working group is also drafting a uniform chart of accounts for health and hospital boards to use.

The Standing Committee on Public Accounts is of the opinion that this an important initiative. Because of the various barriers to effective management that are created by these system deficiencies, a priority should be placed on the finalization of the work and enhancement of accounting systems within a definite time frame.

Recommendation 24

Therefore, this committee recommends that the Department of Health work with health and hospital boards to develop a plan by January 1, 1994 for the standardization of board accounting systems; And further, that the department and boards complete implementation and training for new system components by April 1, 19944 and complete a comprehensive evaluation of system performance by April 1, 1995.

Capital Assets

Chapter six of the Auditor General's report deals with the management of capital assets by the Department of Health. The report notes that, from 1987 to 1991, the Government of the Northwest Territories spent over $55 million on capital assets for the health system. In fact, additional information provided departmental officials during public hearings indicates that the total dollar amount is even higher.

Last year, the Standing Committee on Public Accounts considered matters related to government-wide management of capital assets in conjunction with its review of the Auditor General's 1990-91 Annual Report on Other Matters, and commented on this in a report tabled June 25, 1992, Committee Report 13-12(2). At that time, it was made clear that:

The committee was disturbed to hear a recurrent theme: that departments had control systems, but none were complete, and there is no overall control and accountability for asset control.

In reality, no one knows exactly what the government owns or what it is worth. This is disturbing because the assets owned represent major investments in infrastructure and other items for the people of the territories. The committee got no satisfaction that the various departments were doing a good job of effectively managing and controlling this large investment.

The standing committee is again concerned that the Auditor General's report provided evidence that the Department of Health did not have suitable policies and procedures in place for the adequate management of its significant capital assets. However, during January 1993 public hearings, the standing committee was informed that the department has initiated a number of projects that have been aimed at improving capital asset management. This was seen as a positive development.

For instance, the Auditor General noted that the capital Projects process manual has not been updated since 1982 and is not often used by the department because it is out of date. During January 8 public hearings, departmental officials advised that a review has been undertaken with the Department Responsible for Government Services and Public Works, and should be completed by September 1993. At the same time, work is being carried out to revise capital standards and criteria for health facilities -- another one of the shortcomings identified in the Auditor General's report.

Post-Occupancy Evaluation Of Capital Projects

The standing committee took notice of the Auditor General's comments that the department needs to improve project management follow-up after completing construction projects. It was a matter of concern that major capital projects are being completed without adequate follow-up inspections. During public hearings, the department responded that a process for post-occupancy evaluation has now been developed, and that inspections are generally scheduled anywhere from 12 to 24 months after a facility has been constructed and/or renovated. The standing committee was pleased to learn this, but is also aware that there is little point to having a "process" unless it is used consistently.

Recommendation 25

Therefore, this committee recommends that the Department of Health ensure that post-occupancy inspections are carried out for all capital construction projects using standard criteria.

Capital Assets Tracking Procedures

The standing committee's June 1992 report (Committee Report 13-12(2)) also commented on the need for government-wide improvement of systems for monitoring the location and status of capital holdings.

The Auditor General's comprehensive audit found that the Department of Health was poorly organized for monitoring its capital equipment and other holdings, and that asset inventories were inadequate.

During public hearings on January 8, the standing committee was pleased to learn that some progress had been made on developing a capital assets tracking system (CATS). Some concerns were raised, however, that once again the initial design for this system had been developed as an internal process and that boards were only informed after the framework was set.

While the standing committee is of the opinion that the CATS project will eventually allow the department to develop a much improved inventory, Members also wish to emphasize the importance of working closely with all boards. System compliance will be increased only by a sense of ownership that comes from full participation. As well, it is important that CATS implementation procedures are scheduled in a way that does not conflict with other board administration deadlines at the regional level.

Recommendation 26

Therefore, this committee recommends that the Department of Health accord a high priority to final development and implementation of the capital asset tracking system.

Terms Of Medevac And Ground Ambulance Contracts

In several cases, the Department of Health has contracted with St. John Ambulance to provide air medevac support and ground ambulance services. The terms of these contracts have been either two or three years.

During public hearings on January 8, the Standing Committee on Public Accounts heard from witnesses representing St. John Ambulance that they would recommend longer contractual terms. This would provide all potential contractors with additional fiscal stability and allow better planning for program enhancement. Further, it would allow for greater cost-efficiency in ambulance leasing over an extended period than on a yearly lease basis.

The standing committee understands that the Department of Health has been reluctant to encourage longer leasing arrangements until areas of board and departmental responsibility can be better defined. With the impending establishment of the master memorandum of understanding referred to earlier, however, this impediment will be removed.

Although this matter was not specifically reviewed by the Auditor General over the course of his comprehensive audit, the Standing Committee on Public Accounts is of the opinion that there are definite advantages to considering five-year contracts for the delivery of medevac and ground ambulance services. This standard should be considered whether it is the boards or the department who eventually hold contract authority for these services.

The Standing Committee on Public Accounts expects that the department will study this matter in detail. The committee intends to follow up on progress in this area during future hearings.

Financial Issues

The seventh chapter of the Auditor General's report deals with a number of specific observations about fiscal management within the Department of Health.

Procedures For Budget Development And Management

The Auditor General observed that the department, for instance, has not done well in terms of its ability to accurately predict budgetary needs, often requiring the Minister to request additional appropriations from the Legislative Assembly. The report stated that:

The annual pilgrimage (for supplementary appropriations) is symptomatic of the lack of accountability, the unclear definition of cooperative arrangements, and the need for more effective information management. (page 41)

... The department starts each year without enough money to deliver its programs and has to be bailed out by increasing amounts of supplementary funding. Supplementary estimates have increased by six percent over budget for 1989-90, 10 percent for 1990-91 and 12 percent for 1991-92. (page 42)

The Standing Committee on Public Accounts took special note of these concerns. During public hearings on January 8, the department acknowledged certain difficulties. Increases in funding to hospital and health facilities have been necessary to reflect collective agreement increases, inflationary increases to other O and M and basic increases to budgets to reflect service delivery levels. Timing delays in the receipt of cost data for the insurance programs of medical travel, medicare and NWT hospitals make it difficult to incorporate these items within operational planning (OPPLAN) procedures. Complicating this is the observation that neither total resources nor their regional allocation at the time of devolution were adequate.

The standing committee wishes to emphasize that, notwithstanding the fact that these factors are often seen to complicate the forecasting process, there are some very real and disconcerting implications related to the budgetary planning and reporting failures observed by the Auditor General.

Some of these relate to political aspirations of northern people. As pointed out in the written submission received from the Metis Nation of the Northwest Territories:

We are aware of the already high cost of health care in the Northwest Territories, and sincerely hope that your review of the Auditor General's report will lead to improved efficiencies so that cost alone does not stand in the way of extended health care for Metis. Our people have lived with this inequity for too long.

Other implications relate to working relationships with the health and hospital boards. The standing committee was concerne

d to note that boards do not always understand, and cannot predict, target adjustments imposed on their budgets through departmental direction.

Clearly, attention needs to be paid to the process through which expenditures are forecasted and departmental budgets are developed. Specifically, the department needs:

- trend information and prediction models showing estimated price and use of provincial facilities;

- cost prediction models for hospitals, medicare and medical transportation;

- systems which allow better analysis of whether cost increases are due to price and volume fluctuation ... or to trends in the health status of residents requiring treatment;

- a more comprehensive understanding of work load factors at the community level;

- greater predictability in physicians' expenses through per diems and salary contracts;

- tighter monitoring of medical travel utilization;

- standards and documentation requirements for the review of quarterly variance reports by senior management; and

- an expansion of the quarterly variance report format to allow more complete documentation of management control activities.

The Standing Committee on Public Accounts was encouraged to note that the department has already undertaken initiatives aimed at addressing several of these needs.

However, Members were very concerned that some important projects are being delayed because of the need to focus on the decentralization of territorial health insurance services to Rankin Inlet and Inuvik. The committee was advised by departmental officials that a proposal for the development of management data for the insurance programs, for instance, had been delayed by staff changes and the prioritizing of decentralization procedures. The committee is of the opinion that these larger needs should not be further compromised by the government's decentralization initiatives and urges the department to develop a more appropriate global work plan.

The finance and administration division appears to be making considerable progress toward addressing several of the specific issues related to budgetary forecasting and reporting. The standing committee is of the opinion that the completion of these measures should be regarded as a departmental priority.

Medical Travel

The Auditor General commented on the high cost and inherent difficulties in funding medical travel in the Northwest Territories. The Standing Committee on Public Accounts urges the Department of Health to make improvements in noted areas with respect to quality controls in claim processing and in the monitoring and management of medical travel. Specifically, claims documentation should include the reasons for medical travel and measures need to be developed to verify patient attendance at medical appointments.

Medical travel policies revised in August 1991 should be reviewed to ensure that revisions have had the required effect, and a long-range study of the impact of shifting referral patterns to Stanton Yellowknife Hospital should be undertaken.

For several years, employee and non-employee medical travel programs were administered separately by the Department of Personnel and the Department of Health respectively. The Standing Committee on Public Accounts noted the March 12, 1993 announcement by the Minister of Health that management of medical travel benefits to GNWT employees would be consolidated within the Department of Health during the 1993-94 fiscal year. This conforms with one of the Auditor General's key recommendations on medical travel, and should be given a high priority by both the Department of Health and the Department of Personnel.

Management Reporting And Accountability

Chapter Eight of the Auditor General's report deals with the inadequate use of the Management for Results System (MFRS), a government-wide management reporting system used by all departments. The report contained observations that:

The department does not use the system to its fullest potential. The objectives and goals are not clearly stated and its indicators are poor, and there is inconsistency in the quality of reports produced by managers. Managers need to be involved in developing indicators for their divisions, if they are to be committed to using them. (page 47)

The Standing Committee on Public Accounts is aware that problems with the use of MFRS are not unique to the Department of Health and that, in fact, most departments could be called on to improve deficiencies in management reporting. Given the particular need for greater direction and a more systematic approach within the Department of Health, however, it is especially important that managers work according to a set of objectives and standards.

Recommendation 27

Therefore, this Committee recommends that all senior consultants, heads of sections and directors of divisions within the Department of Health should complete in-service training in the use of MFRS by April 1, 1994.

In reviewing previous performance of the Department of Health, the Standing Committee on Public Accounts noted that a great many of the matters raised by the Auditor General had, in fact, been identified as problems by the department and included in the department's Definitive Objectives during prior years' estimates review. These, in many cases, were not met by the conclusion of the respective fiscal year. In some cases, they still have not been met.

The Standing Committee was also concerned with the way that many Definitive Objectives in previous years were worded in a very general fashion that would make evaluation difficult.

Recommendation 28

Therefore, this committee recommends that the Department of Health prepare a comprehensive report on which definitive objectives have been met since 1988, and include a plan for meeting any unfulfilled objectives.