Discussing Our Performance by Anticipated Result

We assess our performance for the Corporate Management and Direction business line against our eight anticipated results as they relate to our expected outcome: Performance of our business services and operations is maximized through modern and innovative management approaches .

Ratings are provided for each anticipated result. They show whether our performance met (green), mostly met (yellow), or did not meet (red) the results. We provide a separate rating on the quality of the information upon which we based the assessment. As with other business lines, we assess our performance against two themes: managing the compliance continuum and innovation for the future.

Highlights

Since becoming an agency, we have been building a sound governance regime to support modern and innovative management, while respecting Parliament's expectations for transparency and accountability (see Exhibit 94 ). The CCRA's Governance Model has three main components: the Minister, with overall accountability to Parliament; the Board of Management (BoM), responsible for oversight management; and the Agency Management Committee, which looks after Agency management and direction.

Two pillars support our governance regime:

• effective decision-making and control through our senior committees—the Board of Management (BoM) and the Agency Management Committee (AMC); and

• appropriate accountability through our Corporate Business Plan, the Annual Report, and the Balanced Scorecard (BSC), backed by enhanced internal audit and accountability contracts with all managers.

Our new governance model provides for an oversight that is more disciplined and more demanding. This is due in large part to the BoM, which brings Canadians' interests and business-like approaches directly into the CCRA's management processes, and challenges us on our progress against our commitments. While the governance model is sound, it requires further maturing and integration. Similarly, we must better integrate the financial and non-financial components of our business into our oversight and governance practices. At present, our systems are not able to easily provide all the information needed to respond to the requirements of the new BoM and the AMC. The Balanced Scorecard will address this need, and although we did not progress as expected last year, we are now on track for 2002-2003.

These changes in our governance framework are also guiding other important initiatives, for example: the transformation of our financial operations; tighter links between project proposals and their fiscal implications; the move toward activity-based costing; and an innovation investment strategy and quarterly budgeting.

Our key accountability instruments are the Corporate Business Plan which lays out the plan to achieve our objectives, and the Annual Report, which reports in plain terms on the results we have achieved. The inaugural Annual Report, tabled in November 2001, received a generally positive overall assessment from the Auditor General, who noted that it represented an “impressive start.” We also enhanced our internal audit function in terms of risk control, assurance, and corrective actions.

CCRA's Governance Model

In 2001-2002, the second year of agency status, the CCRA continued to significantly benefit from our unique governance regime. The BoM brought executive oversight and leadership to bear on the policies and management frameworks needed to exploit the advantage of the CCRA's unique structure and authorities.

In 2001-2002, new streamlined and agency-tailored policy instruments relating to human resources, information technology, and finance and administration were approved, as well as key corporate documents such as the CCRA's 2002-2003 to 2004-2005 Corporate Business Plan and the 2001-2002 Annual Report to Parliament.

The review of the Agency's Management Policy Framework, planned for 2002-2003, will further strengthen governance by: confirming that management policies correspond to independent agency status; identifying and correcting weaknesses in current policy development, approval, implementation, and review processes; and ensuring that due diligence is exercised in policy promulgation in the Agency.

To improve management oversight in 2001-2002, we began briefing the Board of Management and the Minister on potentially troublesome issues identified by the Office of the Auditor General (OAG). To support its oversight role, the BoM is also briefed on findings of the CCRA's internal audit and program evaluation teams.

Exhibit 94: CCRA Governance Model

Canada's Public Policy Forum (PPF) has been involved in advising Government on the development and implementation of the alternative service delivery concept. In 2001-2002 the PPF initiated a study to describe the CCRA's progress in working within its legislated governance structures and authorities. Preliminary findings from the study include the following:

• The high-level governance structures are a faithful rendering of the provisions in the CCRA Act.

• The CCRA is not using its flexibilities to the maximum.

• There are observable changes in senior management culture. In particular AMC members and their direct reports are taking greater ownership and responding faster to management policy issues.

• The Corporate Business Plan and Annual Report hold considerable potential as core management documents.

Highlights

Since becoming an agency, we have been working toward shifting our corporate culture to one that increasingly relies on values instead of rules, and on empowerment through greater delegation of authorities and accountability. In 2001-2002 we made major strides toward this objective, including:

• the creation of a Management Group (MG) of some 3,200 front-line managers who will power the cultural change. Decision-making authority has been put more squarely in the hands of managers who know their clients and business processes best, equipping them to more effectively deliver the CCRA's mission and promote an environment of trust, dialogue, and responsiveness;

• greater delegation of authorities in the areas of human resources, real property, financial management, and administrative policies; and

• results-based management through clearer goals and accountabilities, which are communicated in the Corporate Business Plan and the Annual Report, respectively. These are embedded in performance agreements for almost 600 executive and for over 3,000 MG members. These agreements form the basis for assessing and rewarding good job performance and effective people management.

While we believe that the cultural shift is well under way at the overall corporate level, we have not yet been able to thoroughly entrench this shift at all levels of the organization. This remains a key challenge. Overall at the corporate level, staff training has not kept pace with the scope and momentum of this cultural change and is a high priority for 2002-2003 and beyond.

Exhibit 95: Cultural Shift at the CCRA

Highlights

With more than 50,000 workers at peak times, human resources are a critical determinant of CCRA performance. Our employees deliver our business results in a highly complex and dynamic work environment, and they should expect a Human Resources (HR) system that is responsive, flexible, integrated with other corporate services, and strategic.

When we became an agency, it was evident that our HR system, designed for a public-service environment, had many significant shortcomings. For example, the classification system was too complex, with 35 different standards that created inefficiencies and delays; the staffing system took on average five months for external recruitment; the recourse process was lengthy and adversarial; the performance management process often ignored poor performance and failed to reward excellence; and managers were not sufficiently empowered to take responsibility for managing people. As a separate employer we now have responsibilities for staffing, classification, and labour relations, with the flexibility and discretion to customize our processes to fit our business needs. These new responsibilities underpin our HR change agenda.

In becoming an agency, we launched a comprehensive, five-year, Human Resources Reform and Renewal plan with 14 major initiatives that address the key aspects of effective people management. During year one, we addressed the elements required by our new separate employer status, in particular, putting in place staffing, classification, and dispute resolution systems. This year, we have further developed these systems. We also achieved breakthroughs in key areas, which have already attracted interest from outside the Agency as potential HR innovations. They include:

• The creation of a new Management Group (MG) of some 3,200 managers previously managed through 20 different classification standards, simplifying our management process and enhancing our links to front-line employees. This is a Public Service first. The MG is supported by negotiated pay plans that include unique performance rewards for effective people management.

• Connecting the commitments in the Corporate Business Plan from executive cadre performance agreements to employee performance expectations allowing us to better recognize achievement and address cases of under performance.

• Employees developing 25,000 individual learning plans, as part of the foundation for a continuous learning organization.

We have also focused on other enablers that are critical to achieving continuous performance improvements across the Agency. For example, during the last year we:

• concluded settlements with our two unions without labour disruptions;

• piloted pre-qualified pools of candidates in high-demand areas such as customs inspectors, revenue collectors, and tax and GST auditors;

• hired some 4,500 new permanent employees, 44% from outside the CCRA and the remainder from our temporary workforce; and

• achieved a national representation rate for the four designated employment equity groups at or above the most recent labour market availability rate. For example, we succeeded in increasing our representation of visible minorities from 8.4% to 8.7%.

There are, however, a number of areas where improvement is needed. The development of the Agency Classification System for groups within the organization other than the MG was deferred, and now needs to be addressed to advance the Agency's classification efforts. Our bilingual capacity in the workplace lags behind the average in the federal public service—expectations for official languages are now embedded in executive accountability contracts. We also need to address the significant delays many employees face in receiving acting and overtime payments, among others. Finally, after two years of implementation, the Corporate Administrative System (CAS), which is meant to provide the CCRA with meaningful, accurate, relevant employee data and performance information, is still not performing to the degree required. We therefore need to enhance our measurement capacity and also develop further measures to better report on our HR performance.

Exhibit 96: Human Resources Reform and Renewal Initiative

The Human Resources reform and renewal initiative

In 2000-2001, the CCRA launched an HR Reform and Renewal Initiative and completed the initiatives necessary to meet new statutory requirements (i.e., staffing, dispute management, classification, and labour relations). Last year the focus was on implementing other key elements of the Framework. Following is a discussion of some key achievements.

Enhancing Our Management and Leadership Capacity

The senior management (SM) level, comprising 233 jobs within the Executive category, was created in 2000-2001 to strenghten and unify the management team. During 2001-2002, the Management Group (MG) was created, consisting of some 3,200 managers, to acknowledge the importance of the managers' role in front-line operations. The Agency Classification System (ACS) was adapted to support the new MG, with 8 key job requirements re-weighted to incorporate elements of the previous 20 classification standards. To enhance the development of management skills in the MG, we implemented a Leadership Program, a computer-based Learning Interface, and a performance reward compensation component.

Nearly half of the members of the SM and Executive (EX) groups become eligible for retirement within the next five years. To prepare for this, we initiated the development of an EX/SM succession planning model to develop the managers and executives needed to address impending shortages with the skills and expertise we require.

Together, the SM and MG provide us with the solid management and leadership cadre we need for the success of our HR reform and renewal initiative. Our managers are the main link between human resources and business management, and their HR efforts to support, motivate, and develop employees in order to meet the CCRA's business objectives make them key change agents.

Performance Management Regime

We have now fully developed and begun implementing a results-based performance management regime for all employees. This links the expected achievements in our Corporate Business Plan to the performance agreements of our management cadre (EX, SM and MG) who, in turn, are required to establish performance expectations for their own employees.

All executives and senior managers have results-based performance agreements with provisions to reward performance for program and people management. Newly negotiated MG pay rates also include performance rewards (pay or leave) for sound people management.

Across the Agency, more than 30,000 employee performance expectations were completed in 2001-2002 and 25,000 individual learning plans were prepared (see Exhibit 96 ). Nearly 95% of our MGs fulfilled this important component of their people management responsibilities.

Staffing

Standardized assessment tools have been developed to evaluate all organizational, behavioural, and some technical competencies. This has enabled us to set up pre-qualification pools (PQP) on a pilot basis for high demand groups such as custom inspectors, revenue collectors, and Tax and GST auditors. We also continued to develop the necessary IT infrastructure to support the implementation of the assessment results. The competency-based approach will enable managers to match employee and job competency profiles using a “just-in-time” staffing approach, and to identify skills gaps to be addressed on an Agency-wide basis.

Last year, we reported a 30% reduction in the time required to staff positions through internal competitions. Further progress is expected when our PQP system is fully implemented by 2004-2005. In the meantime we are taking advantage of streamlined staffing procedures to fill positions with minimal delays. For example, an internal and external process involving 105 candidates for 12 positions, was completed in 65 calendar days, considerably faster than in our Revenue Canada days under the Public Service Employment Act.

As for staffing recourse, during 2001-2002 we provided 6,290 individuals with feedback (compared to 4,470 in 2000-2001) and 523 with decision reviews (compared to 260 in 2000-2001), and 35 cases were submitted for independent third party review (up from 27 last year), with 20 cases being resolved.

A survey conducted this year showed that CCRA managers are taking the broad principles of the new staffing system to heart. Of those who responded:

• 82% agreed that the staffing process was guided by the fairness principle;

• 80% thought that the process is guided by the competency and effectiveness principle;

• 75% felt the process was guided by the efficiency principle; and

• 69% agreed the process was guided by the adaptability and fairness principle.

In addition to a new student program, an applicant management tracking system was introduced in 2001-2002 and will be further developed in 2002-2003.

Employment Equity and Diversity

Exhibit 97: Representation of the Employment Equity Designated Groups Within the CCRA

The Agency approved a new employment equity (EE) policy and specified Employment Equity and Diversity as a required competency for all positions. In 2001-2002 we continue to meet all employment equity expectations at the national level for all designated groups (women, Aboriginal peoples, visible minorities, and persons with disabilities) (see Exhibit 97 ). However, to accelerate progress, particularly in light of changing labour market demographics, we developed and began to implement a three-year strategic plan which sets out representation goals, based on labour market availability, for each of the four employment equity groups. At the same time, regional under-representation in certain occupational group levels will require our continued attention. These achievements reflect the CCRA's unequivocal commitment to the principles and objectives of employment equity and workforce diversity. Over the review period, representation of the visible minority group grew from 8.4% to 8.7% of our workforce. However, for persons with disabilities there was a decrease in representation, although the rate remains above labour market availability.

HR Planning

Regional HR plans now extend to staffing, official languages, and employment equity requirements and strategies. Efforts continue to strengthen the links between HR and business planning to prepare for the major business transformation initiatives and the expected increase in “baby boomer retirements” over the next 5 to 10 years.

The following data reflect key developments in our workforce during 2001-2002:

• Permanent staff grew from 37,400 to 40,000 people.

• Temporary staff varied from 6,800 to 12,700 in response to workload fluctuations.

• We recruited more than 4,500 new permanent employees, 56% of whom were former term employees, while 44% were recruited from outside the CCRA's (compared to 34% in 2000-2001).

• In our vital Auditing employee group, we turned a net loss of 1.2% in 2000-2001 into a net gain of 4.4%.

• Our complement of program management permanent employees including custom officers, tax assessors and junior auditors grew by 3,500, or 10.5%.

Exhibit 98: Auditors Eligible for Retirement (Cumulative)

Key HR priorities in 2002-2003 will include developing human resources strategies to effectively manage demographic pressures, notably the anticipated wave of “baby-boomers” retirements. For example, as Exhibit 98 indicates, almost 30% of auditors will be eligible for retirement by 2008-2009. The 2002 Employee Survey will be particularly useful in this regard as it includes questions on employees' retirement plans.

Learning

During 2001-2002, the BoM approved both the Agency Learning Policy and Educational Assistance Guidelines. The First Agency Learning Plan was developed and aligned with the Corporate Business Plan objectives. Together, these are laying the foundations for a learning organization (see Exhibit 99 )

We invested the equivalent of 6.6% of our payroll on learning (surpassing the stated goal of 6%) and piloted a Learning Innovation Seed Fund of $500,000 per year to support 12 learning initiatives accross the country. As well, we enhanced the funding for tuition reimbursement from $2.1 million in 2000-2001 to $4 million in 2001-2002.

Exhibit 99: Elements of a Learning Organization

Eight of the Learning Organizations elements have been implemented (denoted by check marks), and all the other elements are in progress.

Labour relations

In December 2001, the Public Service Staff Relations Board (PSSRB) rendered a decision that greatly simplified our collective bargaining process. Where the Agency once had 6 unions and 13 bargaining units, we now have 2 unions and 3 bargaining units (See Exhibit 100 ). The agreements currently in force were all negotiated without work stoppage. The agreement with the Public Service Alliance of Canada (PSAC) was concluded in March 2002, and the agreement with the Professional Institute of the Public Service of Canada (PIPSC) was concluded in July 2002.

Unfortunately the PSSRB did not draw a line between management and non-management personnel where the Agency would have liked. This complicated the creation of the Management Group (MG) and obliged us to negotiate MG pay rates with both PSAC and PIPSC, in addition to administering a third pay rate for excluded MG employees.

Exhibit 100: Labour Relations

Alternate Dispute Resolution System (ADRS)

We have also developed and begun implementing our interest-based Alternate Dispute Resolution System (ADRS). It is based on a revised and enhanced CCRA Dispute Resolution Policy and clearer Mediation Guidelines. To date, we have trained over 2,000 managers and 28,000 employees in the alternative dispute resolution process, initiated a national network of alternative dispute resolution advisors, and implemented a ADRS monitoring plan. The ADRS focuses on prevention and early resolution of conflicts, and allows managers to take corrective measures quickly. We believe that the new multi-faceted system has increased employees and management dialogue and trust, contributing to a decrease in formal harassment complaints from a four-year average of about 90 complaints a year to 46 complaints this past year. Our focus for 2002-2003 will be on continuing our training program and implementing a reliable measurement system that will allow us to clearly evaluate our progress.

We hope that the ADRS initiative will also have a positive impact on grievances, which have increased by approximately 25% in 2001-2002 to 5,201, and reduce the cost of dispute resolution while protecting our employees' rights to be treated in a fair, reasonable, and respectful manner.

Compensation

Workloads for our compensation staff continue to grow due in part to high turnover rates. Their efforts are also hampered by outdated paper-based processes. A planned on-line compensation system will allow managers to make many pay-related transactions simply and quickly. Meanwhile, in June 2002, we launched a Web-based training program coupled with electronic tools to assist our compensation staff. Priorities for 2002-2003 are to improve cycle times for processing acting and overtime pay.

Official Languages (OL)

In 2001-2002 the CCRA undertook a comprehensive examination of the OL program and found that only 77% of incumbents of bilingual positions providing internal services met language requirements, compared to 82% in the Public Service. To address this situation, we developed an action plan for language of work which includes specific regional and branch action plans for the management cadre to meet their bilingual requirements. In addition, two Assistant Commissioners have been designated as OL “champions,” and specific bilingualism accountabilities have been established for key executives.

Recognition

In 2001-2002, more than 4,000 certificates and gifts were presented to employees in recognition of their service to the CCRA. In addition, the CCRA Award of Excellence was presented to 392 individuals and teams to recognize outstanding performance.

Employee Assistance Program (EAP)

After extensive consultations with unions, managers, and EAP personnel, the Employee Assistance Program policy was confirmed by the Board of Management in June 2002. It reflects a continuing commitment to high quality employee services and establishes mechanisms to manage, assess, and monitor program performance. In addition, the network of EAP Coordinator-counsellors has been expanded, to meet growing employee needs.

Areas of Improvement

The following areas have been identified for priority attention in 2002-2003:

• developing the Agency Classification System for groups other than the MG, which was deferred in 2001-2002 and now needs to be addressed to advance the Agency's classification efforts;

• improving processing speed for acting pay, overtime payment and promotion adjustments;

• improving the reliability and integrity of HR information in the Corporate Administrative System (CAS);

• improving the capacity to provide internal services to employees in their language of choice;

• developing the necessary performance and measurement information to implement both the People Dimension of the CCRA Balanced Scorecard and the Human Resources Branch Balanced Scorecard; and

• developing HR strategies to effectively manage the demographic pressures of the anticipated wave of “baby boomer” retirements.

Highlights

The CCRA has advanced in establishing transparent and results-based planning, control, and accountability mechanisms that underpin modern comptrollership. Management believes that the necessary elements (strategic leadership, motivated people, shared values and ethics, integrated performance information, mature risk management, rigorous stewardship, and improved accountability) exist at the corporate level. However, some of these elements are more developed than others, and they are not sufficiently integrated to provide the holistic approach to management decision-making that modern comptrollership demands.

In 2001-2002, we made advances in planning and accountability reporting by issuing an improved Corporate Business Plan with an emphasis on results, and our first Annual Report, which set a standard for the CCRA in balanced performance reporting. However, as our experience with the T3 accounting error showed us, we had not invested enough in past years to modernize some of our financial systems and practices. Our performance also fell short in our phased-in implementation of the CCRA's Balanced Scorecard. This will delay the availability of consistent, high-quality information to facilitate results-based management.

A Deputy Assistant Commissioner/Agency Comptroller was appointed and the Modern Comptrollership Office established to strengthen our capacity for modern comptrollership. We will continue our efforts towards activity-based costing, quarterly budgeting and reporting, and enhanced links between the Corporate Business Plan, the Balanced Scorecard, and the Annual Report. Planning is also in progress to advance the Financial Information Strategy, in particular the move to accrual accounting for tax revenues, and the establishment of the revenue ledger. Next steps include the establishment of internal service standards for key activities within the Corporate Management and Direction business line to better report on our performance.

Modern Comptrollership

Modern comptrollership in the CCRA supports our change objective of transparent management for results. In pursuing this goal, we aim to foster a management culture with a strong focus on performance and accountability. We want to ensure that managers and staff understand how well our programs are performing and appreciate how they can be improved. This shift is part and parcel of our business transformation agenda, and will lead to a more client-focused approach to service.

The CCRA's first Annual Report, tabled on November 8, 2001, was a milestone in results-based accountability, highlighting both our notable successes and areas for improvement.

The following CCRA comptrollership business model was developed to guide our future actions in this area. The model identifies eight key components for successful implementation.

A Vision for Modern Comptrollership in the CCRA

Exhibit 101: Transparent Management for Results

The Corporate Business Plan

The Corporate Business Plan, developed in 2001-2002, addresses both ongoing core operations and our strategic change agenda. It emphasizes results and more precisely defined deliverables with performance criteria and targets. In developing the Agency's second Corporate Business Plan, process improvements were realized including earlier involvement of the CCRAs Strategic Advisory Group, full engagement of the Board of Management, and increased horizontal discussion and analysis across business lines.

The evolving EX/SM performance agreement regime, which now applies to about 600 executives and senior managers, is increasingly seen as the key vehicle for translating the Corporate Business Plan priorities and strategies into concrete action. Last year, increased attention was given to monitoring performance against deliverables specified in the Corporate Business Plan. This year, EX/SM performance agreements will emphasise results, targets, and more precise deliverables.

An analysis of external risk factors facing the CCRA was undertaken last year and the results have been included in the Corporate Business Plan. However, the T3 incident flagged the need to better address internal risks as part of our business planning and priority setting.

Balanced Scorecard

To strengthen our move towards results-based accountability and better support senior management decision-making, we aligned and integrated our Balanced Scorecard (BSC) with the framework for the Annual Report and the Corporate Business Plan. The BSC is an integral component of modern comptrollership at the CCRA. With its new focus, the BSC will strengthen linkages between plans, accountability instruments, and performance reports across all business lines.

Over the past year, some 2,500 managers attended BSC awareness/knowledge building sessions. Workshops also enabled more than 200 managers to develop scorecards in five branches and 30 program areas. We expect to have a partial corporate Scorecard early in 2002-2003.

Service Standards

The CCRA continues to move ahead with its service standards initiative. Service standards continue to support our drive toward results-based accountability and better service. Last year, the CCRA reported on some 34 standards mostly related to our operational business lines, and this year we introduced two new standards. We realize that there is considerable progress yet to be made for service standards related to CMD activities.

Highlights

We protect client information and treat it with the confidentiality it requires under legislation. To further safeguard confidentiality, we continued work on the Authentication Management Services project to enhance security for Internet-based information exchanges. Respect for confidentiality is key to maintaining public trust in our operations and our service modernization initiatives. It is also a strict requirement under the Income Tax Act (Section 241) Excise Tax Act (Section 295), Customs Tariff (Sections 107 and 108), and other legislation including the Access to Information Act and the Privacy Act. In 2001-2002, a survey indicated that 81% of Canadians are confident that the information they provide to the CCRA is treated confidentially. This was up from 77% a year earlier.

With respect to processing privacy requests, we achieved 98.4% compliance level with statutory turnaround times, up from 89.5% in 2000-2001. Similarly, despite a substantial increase in the number of access to information requests over the prior year, we improved our turnaround time for processing them—achieving 93.7% compliance level, significantly up from 84.5% last year. In addition to our strong performance in responding to requests for information, we delivered internal access to information and privacy training to more than 1,500 employees.

Our commitment to provide Canadians with more information of better quality was also demonstrated by our transparency about our performance. Our first Annual Report represented a step forward in this regard. We believe the Report presented a balanced and holistic view of our performance by discussing not only our major successes but also our areas for improvement. The Office of the Auditor General of Canada stated that this report “provides a considerably better and more transparent performance story” than our previous departmental performance reports. Our management of the T3 accounting error also showed that the CCRA was open about both its errors and its solutions, and willing to learn from its mistakes.

Highlights

In most respects, we were successful in our ongoing financial management and exercised prudent fiscal management, staying within budget. However, the CCRA's reputation was seriously damaged by an error in the allocation of capital gains refunds earned by mutual fund trusts. This resulted in overpayments totalling about $3.4 billion to certain provinces for the 1993 to 1999 tax years. In response, the CCRA studied and launched a comprehensive financial management improvement initiative to address the root cause. As well, we initiated Phase II of the Financial Information Strategy to improve internal and external financial reporting, and are on track for implementing accrual accounting for tax revenues.

Overall, we demonstrated sound cash management of our $301 billion in annual receipts—and average daily collections of $1.2 billion. We have reliable data for $239 billion of these receipts which indicate the prompt deposit of 98% within 24 hours (up from 97% last year), excluding the $6.4 billion collected during the April peak tax-filing period. Improvements are still needed in our monitoring and financial management systems that cover $62 billion in customs duties, GST/HST, and excise duties and tax receipts. Similarly, legacy costing systems limit our capacity to precisely measure the cost of our operations and productivity gains within business lines.

We made considerable strides toward achieving better long-range strategic resource management through the implementation of a rolling three-year Investment Plan currently set at approximately $110 million a year, which funds some strategic investments required to achieve the Agency's change agenda. The establishment of an ongoing Asset Management Plan of over $130 million a year helps ensure the sustained delivery of our customs and tax administration programs within our existing funding levels.

Administrative Reform and Renewal

In April 2001, the Agency Management Committee and the Board of Management approved a three-year action plan for administrative reform and renewal (AR&R). We expect to save about $50 million between 2002 and 2006, due to AR&R efforts. This year we completed 19 of the 54 AR&R initiatives, including those in the area of real property and facilities management. Our AR&R work in 2001-2002 also included a thorough review of all financial and administrative policies, programs, and systems, and the development of a multi-year work plan to implement reforms.

Financial Information Strategy (FIS Phase)

The FIS Phase II Project was initiated in 2001-2002 to improve accounting, control, and internal and external reporting processes over a two-year period. Achievements to date include system changes which strengthen the accounting and reporting functions for tax revenues. We also developed an automated Revenue Ledger (RL) to capture and summarize data from the CCRA‘s 34 revenue streams. The RL is also a milestone in our move to accrual accounting for tax revenues.

In 2001-2002, the Auditor General of Canada reviewed our Statements of Operations and reported that they accurately reflected the CCRA‘s activities.

Resource Management Review

In spring 2001, following its Resource Management Review, Treasury Board approved an additional $246 million in funding to relieve specific operational workload pressures in the CCRA‘s revenue collection and audit activities to ensure that the tax base is protected (see Exhibit 102 ).

Exhibit 102: Resource Review Funding ($thousands)

In response to Treasury Board's concerns over the quality of our costing information, we completed a preliminary feasibility study in December 2001 and will launch pilot projects in 2002-2003 to assess the usefulness of activity-based costing in meeting the CCRA's strategic management and information needs.

We are also studying the “drivers” which effect the Agency's workload in order to eventually reach agreement with the Treasury Board Secretariat and the Department of Finance about a more systematic funding formula to accommodate changes.

Exhibit 103 depicts the elements of sound financial and treasury management in the CCRA.

Exhibit 103: Sound financial and treasury management in the CCRA

Sustainable Development

We made excellent progress in implementing Year 2 of the CCRA Sustainable Development (SD) Strategy 2001-2004 by achieving 75% of our targets for the period. Major highlights included the finalization of the SD Policy and Environment Policy and launching the SD Toolkit as part of SD learning and to champion best practices.

During the year, we assessed 80 custodial properties for real or potential contamination, 29 of which require follow-up. We also remediated one previously identified contaminated site. The CCRA now has a good picture of its liabilities in the area of contaminated sites and is proceeding with further action.

Overall, we maintained our momentum in the implementation of our SD goals by increasing SD awareness and commitment, strengthening our capacity to deliver results-based reporting, and continuing environmental compliance and stewardship efforts in our operations.

Highlights

Information technology (IT) accounts for about 43% of the Corporate Management and Direction budget. In this anticipated result we report only on our performance in support of the other business lines. Our IT performance for financial, comptrollership, and human resources systems are discussed under CMD Anticipated Results 3, 4 and 7.

We have demonstrated operational excellence and solutions leadership in our support of the other four operational business lines. We provided high levels of operational performance for approximately 200 IT applications that are part of the systems critical to the delivery of services to Canadians. Following the extraordinary circumstances of September 11, we ensured that the key systems required to support the operations of Canada's border points remained fully available.

We also delivered complex new business applications to help meet tax and customs client needs and expectations for accessible, fast, error-free, and confidential tax and customs services. For example, we implemented: the Tax on Income (TONI) system, which provides the provinces and territories with greater flexibilities in tailoring their tax rate structures; the Business Number (BN) registration system, available to the general public over the Internet; the change of address on the Web option for individual clients; and the Intelligence Management System which provides automated support to combat contraband activities.

Last year, we implemented the final components of our 2000-2003 IT Strategic Framework, intended to better define and align our IT priorities and resources. However, we must improve IT performance measurement.

Business Solutions

We provided high levels of operational performance of approximately 200 IT applications that compose the systems that are critical to the delivery of services to Canadians. Following the extraordinary circumstances of September 11, we ensured that the key systems required to support the operations of Canada‘s border points remained fully available.

On the tax side, we developed applications and enabled developments such as the Tax on Income (TONI) initiative which will enable greater flexibility in tax rate structures for the provinces and territories. We also delivered the systems for the launch of the GST/HST TELEFILE service. The CCRA has been a key driver of the Government On-Line (GOL) program, with all of our business lines offering information and services via the Internet. In 2001-2002 for example, we made Business Number (BN) registration and T4 filing for employers available over the Internet. We also launched a new, interactive tax information service and an on-line change of address option for individuals.

To further expand our GOL presence, in 2001-2002 ITB awarded a contract for approximately $32 million for an infrastructure project to improve our capacity to develop e-commerce applications for our business lines.

On the customs side, we provided a range of innovative IT systems which enable improvements in border operations and services. These include:

• The customs Administrative Monetary Penalty System (AMPS) – to administer financial penalties for commercial clients

• The Customs Self-Assessment Program (CSA) – to streamline border transactions for commercial importers

• The Intelligence Management System (IMS) – to combat contraband and support intelligence activities

• The Integrated Primary Inspection Line (IPIL) – to support enquiries by customs officers to improve border compliance and protection

In 2001-2002 we also delivered IT solutions and met all milestones for the Regional Census Processing Project. Under this joint-venture with Statistics Canada, the CCRA processed more than 13 million census questionnaires.

Planning for the future

To improve our capacity to organize, integrate, and manage growing volumes of information, ITB initiated a multi-year Businesses Intelligence/Decision Support (BIDS) initiative in 2001-2002. Upon completion in 2002-2003, the BIDS framework will provide an Agency-wide approach in support of furnishing timely, accurate data for program evaluation and tactical as well as strategic decision-making.

In 2001-2002, ITB also initiated an evaluation of XML standards which will facilitate information sharing among CCRA business lines and enable expanded GOL services.

IT Branch Renewal

A paramount challenge for CMD is to retain the current generation of IT professionals while recruiting and training the next. This is being addressed through the IT Branch Renewal Initiative, which aims to motivate staff and improve the quality of our workplace. In 2001-2002, we launched a new Employee Orientation Program and developed “wellness guidelines” and other projects to nurture our IT workforce. A study released in 2002 by Carleton University's Dr. Linda Duxbury demonstrated that we have made significant progress in initiating positive change for our IT community compared to the broader public service.

Exhibit 104: CCRA/IT Strategic

Date modified:

2002-11-07