Archived – Readiness Assessment of DFO’s Economic Action Plan

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Project Number 6B209
Final Report
March 18, 2010

Table of Contents

• List of Acronyms
• 1.0 Executive summary
  • 1.1 Introduction
  • 1.2 Objectives and Scope
  • 1.3 Summary of Observations and Recommendations
• 2.0 Introduction
  • 2.1 Objectives and Scope
  • 2.2 Methodology
• 3.0 Observations and recommendations
  • 3.1 Overall Summary
  • 3.2 Canadian Coast Guard
  • 3.3 Small Craft Harbours
  • 3.4 Modernizing federal laboratories
  • 3.5 Federal contaminated sites
  • 3.6 Habitat management – Mackenzie gas pipeline
  • 3.7 Recommendations
• 4.0 Conclusion
• 5.0 Management Action Plan

List of Acronyms

 

1.0 Executive Summary

1.1 Introduction

On January 27, 2009 the Government of Canada tabled the 2009 Budget that included funding for a stimulus plan to counter the effects of the global recession. The plan, known as Canada’s Economic Action Plan (EAP), provided almost $30 billion in support of Canada’s economy.

Under the EAP, the Government is investing approximately $450 million over 2009-10 and 2010-11 through Fisheries and Oceans Canada (DFO) that is intended to help create jobs and build the infrastructure to support the fishing and marine industries for the future, strengthen local economies and enhance communities.

1.2 Objectives and Scope

In anticipation of the Auditor General’s work on the EAP, the Internal Audit Directorate was asked to undertake a readiness assessment of the initiatives that DFO is implementing, to ensure that funding is being spent effectively and that appropriate control frameworks are in place.

Objectives

The objectives of the assessment were to:

• assess whether appropriate governance, risk management and controls are in place to ensure the effective management over the DFO’s EAP funding.
• identify any significant gaps in the management control framework requiring management attention.

The assessment did not constitute an audit of any EAP initiatives, or of specific projects or transactions. The assessment focused on the control framework put in place for the EAP funding and did not examine the results of implementation of the initiatives.  

Scope

The scope of the readiness assessment included EAP activities in Small Craft Harbours (SCH), the Canadian Coast Guard (CCG), Habitat and Species at Risk, and Real Property Safety and Security at National Headquarters and in the regions.

1.3 Summary of Observations and Recommendations

General

• The review of the CCG EAP project management practices indicates that the governance, risk management, and control frameworks are adequate.
  
  
• The review of the SCH Repairs and Maintenance initiative indicated that much reliance is placed on existing processes to deliver EAP projects. This is a good practice; however, these processes may not always be documented.
  
  
• The review of the Pangnirtung Harbour project identified deficiencies in the governance, risk management, and control framework and requires attention.
  
  
• The review of initiatives being implemented by Real Property, Safety and Security Directorate (Federal Labs and Contaminated Sites) indicated that existing processes are being followed to deliver EAP projects, however these processes may not always be documented. The extent of documentation may vary by region.
  
  
• The review of the Mackenzie Gas pipeline funding indicated a concern over the monitoring of expenditures against funding received and the accuracy of reporting to the Budget Implementation Committee (BIC). This concern was addressed during the conduct of the review.

Governance

Most EAP initiatives are being implemented using existing governance structures, processes and practices. While this is a good practice, some of the processes followed have not been fully documented. 

The Department has implemented a Budget Implementation Committee as an oversight and monitoring mechanism for EAP. 

DFO has established a framework outlining its approach to reporting on EAP, both internally and externally. A reporting system has been put into place to gather information regarding different aspects of DFO initiatives.   

Risk Management

A Risk Management Framework for EAP was approved by the Budget Implementation Committee.  Mitigation Responses have been prepared to address the risks; however, these responses do not always adequately address the risks and requires attention.

Formal risk assessments have been prepared for some initiatives. For others, risks and potential mitigation strategies are considered on an on-going basis but are not always documented.

Control

As part of the controls for EAP, the Department follows existing Departmental and Treasury Board Policies in the implementation of projects. In addition, existing departmental processes are followed in implementing EAP initiatives, however, these are not always documented.

As well, a departmental reporting framework, that meets central agency requirements, provides for monitoring, on a regular basis, the extent to which EAP initiatives are being implemented.  

The Department provides Treasury Board Secretariat with monthly status reports and the Department of Finance is provided reports on a quarterly basis. In addition, the establishment of BIC provides a control mechanism that monitors the financial status of the implementation of EAP initiatives. 

2.0 Introduction

On January 27, 2009 the Government of Canada tabled the 2009 Budget that included funding for a stimulus plan to counter the effects of the global recession. The plan, known as Canada’s Economic Action Plan (EAP), provided almost $30 billion in support of Canada’s economy and is based on three guiding principles - that projects supported under the EAP be timely, targeted and temporary to support the economy when it is most needed; support Canadian families and sectors most affected; ensure maximum impact for Canadian jobs and output; and protect Canada’s fiscal position by targeting new spending in the next two years.

Under the EAP, the Government is investing approximately $450 million over 2009-10 and 2010-11 through Fisheries and Oceans Canada (DFO) that is intended to help create jobs and build the infrastructure to support the fishing and marine industries for the future, strengthen local economies and enhance communities.

The Department received funding for the following initiatives:

Canadian Coast Guard	$175M (2 years)
Small Craft Harbours: Repairs and Maintenance  Pangnirtung Harbour	$200M (2 years) $17M (2 years)
Real Property Safety and Security Federal Laboratories Contaminated Sites	$38.1M (2 years) $16.4 M (2 years)
Habitat and Species at Risk: Mackenzie Gas Pipeline	$4.1M (1 year)

2.1 Objectives and Scope

The Auditor General has stated in a letter to the Secretary of Treasury Board that her office will be undertaking certain audit work related to the government’s Economic Action Plan to ensure that there are effective management and control over the spending of public money.

In anticipation of the Auditor General’s work, the Internal Audit Directorate was asked to undertake a readiness assessment of the EAP initiatives that the department is implementing to ensure that funding is being spent effectively and that appropriate control frameworks are in place.

Objective

The objectives of the assessment were to:

• assess whether appropriate governance, risk management and controls are in place to ensure the effective management over the DFO’s EAP funding.
  
  
• identify any significant gaps in the management control framework requiring management attention.

The assessment did not constitute an audit of any EAP initiatives or of specific projects or transactions. The assessment focused on the control framework put in place for the EAP funding and did not examine the results of implementation of the initiatives.  

Scope

The scope of the readiness assessment included EAP activities in Small Craft Harbours (SCH), the Canadian Coast Guard (CCG), Habitat and Species at Risk, and Real Property, Safety and Security Directorate at National Headquarters and in the regions.

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2.2 Methodology

The following methodology was used for the readiness assessment:

• A control checklist that outlined assessment criteria was developed and used to assess the EAP initiatives:
  
  
• Information was obtained from the review of key documents such as:
  
  
  • project approval documentation;
  • accountability documents;
  • management frameworks and controls;
  • risk and performance profiles;
  • policies, procedures, manuals and directives; and
  • previous audits and status reports.
    
    
• Interviews were conducted with DFO staff at Headquarters and in the regions.

A key document used in the preparation of the criteria was the letter sent by the Auditor General to the Secretary of Treasury Board outlining what the government might expect her Office to look at in its EAP audit work. Her expectations were carefully considered in the assessment of the work carried out by the Internal Audit Directorate. 

3.0 Observations and Recommendations

This section provides a summary of findings at a high level followed by the findings specific to the areas responsible for implementing the EAP initiatives.  

3.1 Overall Summary

Governance

Governance includes the processes and structures in place to inform, direct, manage, and monitor activities of an organization toward the achievement of its objectives. In accordance with Treasury Board Policies, departments are expected to establish and approve sound internal policies, guidelines and practices to be followed for identifying, planning, approving/budgeting, defining and implementing projects.

Most EAP initiatives are being implemented using existing DFO governance structures, processes and practices. While this is a good practice, some of these have not been fully documented.

The Department implemented an EAP oversight committee referred to as the Budget Implementation Committee (BIC). The Committee is chaired by the Deputy Minister with membership consisting of senior executives of the Department. The Committee guides the management and oversight of all projects, and is responsible for leading and guiding all aspects of the EAP, including risk management and reporting.

The Committee has an approved Terms of Reference and meets bi-weekly or at the call of the chair. Minutes of meetings are recorded and distributed after each meeting. Working groups are established as required to address specific issues.

DFO has established a framework outlining its approach to reporting on the status of initiatives, both internally and externally. A reporting system has been put into place to gather information regarding different aspects of DFO initiatives and to ensure the completion of reporting to Treasury Board Secretariat and the Department of Finance, as well as bi-weekly departmental updates provided to the Budget Implementation Committee. 

Risk Management

A Risk Management Framework for EAP initiatives was prepared by the Chief Financial Officer sector. The framework was approved by BIC on May 11, 2009. It was designed to meet the risk management requirements of senior management, in that it provides assurance that all material risks linked to projects are identified, assessed, mitigated and monitored.

A Mitigation Response Status Tracking Grid was developed in consultation with BIC and the appropriate program managers responsible for EAP. It provides BIC with possible mitigation strategies that allow the members to better monitor the management of the identified risks.

As part of the readiness assessment, the Internal Audit Directorate reviewed the Risk Management Framework and Mitigation Strategy. It was concluded that appropriate risks had been identified for the EAP, however raised some concerns around the evidence to support the mitigation strategies, clear identification as to who is responsible for action, and accountability for monitoring of the risks.  

It is our understanding that the Risk Management Framework will be revised to reflect the concerns raised and tabled at a BIC meeting in February 2010 for review by Committee members.

Control

As part of the controls for EAP, the Department follows existing Departmental and Treasury Board Policies in the implementation of projects. In addition, existing departmental processes are followed in implementing EAP initiatives, however, these are not always documented.

As well, a departmental reporting framework, that meets central agency requirements, provides for monitoring, on a regular basis, the extent to which EAP initiatives are being implemented.  

The Department provides Treasury Board Secretariat with monthly status reports and the Department of Finance is provided reports on a quarterly basis. In addition, the establishment of BIC provides a control mechanism that monitors the financial status of the implementation of EAP initiatives.  

3.2 Canadian Coast Guard

Through Canada’s EAP, the federal government is providing $175 million over 2 years to the CCG in funding. Projects are primarily delivered in the regions using PWGSC to manage the majority of the projects as the procurement and contracting authority.

Project Selection

Projects were selected through existing processess in place in the CCG, such as the Small Craft Acquisition Program and the capital expenditure investment areas identified in the Department’s Long-Term Capital Plan.

On some initiatives in 2009-10, CCG will spend less than what had been forecasted. To fully utilize the available funds for 2009-10, the CCG will transfer funds not required on one project to another that will be able to use the funds. In addition, an arrangement is being made to have Small Craft Harbours use approximately $8M in CCG funds in 2009-10 that they could not spend. Small Craft Harbours will repay those funds to the CCG in 2010-11. 

Governance

Much reliance is placed on existing processes for the execution of CCG projects. The EAP processes for the CCG are clearly documented and adequate.  

The Project Management Framework sets the common and mandatory management practice guidelines, business rules, instructions and processes that must be followed by all members of the project team in order to ensure and maintain a coherent project planning, management and reporting structure.

Projects are delivered through both the regions and CCG Headquarters under the Project Management Framework. PWGSC is the contracting authority for all the CCG EAP projects. A formal Integrated Technical Services Project Management Methodology exists for all technical projects to use to manage accountability, for cost, scheduling and product quality. The methodology is supported by Project Management Principles and Project Management Requirements.

The approval document for the Coast Guard EAP projects vests overall project leadership in the Commissioner of the CCG. The Director General of Fleet is vested as the Project Sponsor authority and the Director General of Integrated Technical Services is vested with the responsibility to implement the project. Authorities, accountabilities and roles and responsibilities are documented by phase in the Project Management Framework and in the project management methodology. Delegation is outlined in the prepared Project Charters.

Other elements of governance structures are in place and include the Budget Implementation Committee, established at a high level, to lead and guide all aspects of EAP initiatives. The CCG has established a CCG level committee chaired by the CCG Commissioner that coordinates and oversees planning, implementation and delivery. It is called the CCG EAP Steering Committee.

Risk Management

CCG has developed and documented a risk management plan for each of its EAP projects. The plan is a continuous risk management process that identifies risks and monitors residual risks. Risks are tracked with  Monthly Project Progress Reports to ensure the effective execution of risk response plans to manage the risks. Risk assessments are done per type of risk. Project risks including mitigation strategies are also identified in the Effective Project Approval and Project Charter documents.

Control

CCG has established an adequate project management process in accordance with Treasury Board and DFO policies, procedures and guidelines. The CCG EAP Project Management Framework and CCG Project Management Methodology provide support and control.

CCG has developed an adequate framework for effective project monitoring and review to identify deviations early in the process. Each EAP project/group of projects is overseen by the CCG EAP Steering Committee as well as by initiative-specific steering committees chaired by the Director General, Integrated Technical Services. Projects are monitored on an on-going basis through a combination of the committees, tele-conference meetings, and monthly Progress Project Reports. Reports on Financial and Schedule of Risk Management are sent to the Central Project Coordination Office every month. These reports are used by the EAP project team for managing and charting progress of projects.

CCG's EAP Project Management Framework includes financial and management of project expenditures. Monthly and quarterly reports are forwarded to TBS and Finance using a series of templates.

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3.3 Small Craft Harbours

3.3.1 Small Craft Harbours (Repairs and Maintenance of Core Fishing Harbours)

Small Craft Harbours (SCH) received $200 million over two years in EAP funding to accelerate project work on core fishing harbours. Funding obtained through EAP provides for an acceleration of the work already being undertaken by SCH on a regular basis through its repairs and maintenance of core fishing harbours program.  Projects are primarily delivered in the regions using a mix of PWGSC and in-house expertise to manage the projects.

SCH also received $8M from the Canadian Coast Guard for the delivery of additional projects, as the CCG was unable to spend these funds in 2009-10. SCH will reimburse the CCG in the second year of the stimulus funding initiative.  This was done with the necessary approvals.

Project Selection

In anticipation of stimulus funding available through the EAP, National Headquarters asked the regions to identify projects that would meet the criteria for EAP funding, that being timely, targeted and temporary. A proposed list of projects totalling $300 million was developed. SCH subsequently received approval for $200 million in EAP funding to accelerate project work. The projects selected for EAP work was based on the priority ranking of all projects submitted by the regions. 

Governance

Much reliance is placed on existing processes for the execution of SCH projects, which is a good practice. The weakness lies in the fact that these processes may not always be documented. If a governance structure is not documented, it can lead to unclear accountability for projects and confusion or misunderstanding of roles and responsibilities. 

Elements of governance structures are in place for SCH EAP projects; however, there are inconsistencies in the extent to which governance structures are documented.  For example, roles and responsibilities are documented to varying degrees; some committee structures are in place however, terms of reference are not always approved or minutes/records of decisions prepared.

Projects are primarily delivered in the regions using a mix of PWGSC and in-house expertise to manage the projects. A national Infrastructure Program Agreement between DFO and PWGSC is in place that sets out the reporting requirements and roles and responsibilities at the departmental level. For individual projects, a Specific Service Agreement or project charter is prepared that sets out project delivery steps. These documents provide broad statements of roles and responsibilities and are not necessarily specific enough to provide clear direction to those involved in project management. For example, the Project Charter, in some cases, refers to the Project Leader as DFO. This is not specific enough to hold anyone accountable for the project.

For projects managed by PWGSC, there is a process that must be followed within DFO from the time projects are identified to the time arrangements are entered into with PWGSC. This process is not documented. 

For projects managed by DFO, inconsistencies exist in the documentation of processes for project delivery using DFO mechanisms. For example, project charters are not always prepared; roles and responsibilities and accountabilities not clearly defined. The documentation may vary by region.

To ensure that SCH has the flexibility and tools to deliver its commitments, the Department sought an increase in specific contracting authorities to facilitate delivery of architectural and engineering and construction projects at SCH across Canada. DFO’s authorities for competitive construction contract awards were increased from $400K to $1.5 million and for amendments to contracts from $200K to $500K. 

For the most part, existing processes were used for project approvals. However to expedite project approvals for some projects,  SCH sought Omnibus Approval from the Deputy Minister to help fast-track the delivery of 48 projects. 

Risk Management

At the program level, a risk management profile was developed for SCH in 2007 and is in the process of being revised. Many of the risks identified are applicable to the implementation of EAP projects as funding is used to accelerate the work already being undertaken by SCH on a regular basis.  The approval document for the EAP funding also identified some risks and mitigation strategies.

On a project basis, there are inconsistencies in how risks and mitigations are identified. Some regions document the risk assessments for their projects while in others, the risks are discussed informally and are not always documented.  

Control

Oversight on projects is carried out to ensure that a project is proceeding as planned, deliverables are on time and within budget and that appropriate management practices are being adhered to. 

At the SCH Program level, a National Management Committee is chaired by the Director General SCH and includes Headquarters and regional representation; it serves as an oversight body for EAP initiatives. Terms of Reference have been developed but have yet to be approved for this committee or minutes / Records of Decisions of meetings kept. 

PWGSC and DFO meet regularly at Headquarters and in the regions in regards to the implementation and monitoring of SCH projects in accordance with the Infrastructure Program Agreement. Following these meetings, actions and decisions are developed to address issues. Projects are monitored on an on-going basis through e-mails, telephone/teleconference meetings, face to face conversations and committee meetings. However, these activities are not always documented.

SCH has a national tracking system,“Information Portuaire / Port Information”, referred to as IPI. The system reports on the financial status of projects. Regional SCH offices have their own individual databases to keep track of the information. The regions are responsible for tracking and monitoring of projects and contracts to inform HQ on the status of projects.

3.3.2 Hasten Construction of a Small Craft Harbour at Pangnirtung, Nunavut

General

The construction of a small craft harbour at Pangnirtung was mentioned in the 2008 Budget with a requirement of approximately $11M in funding identified at the time. In 2009, DFO received approval for the $11M mentioned in the 2008 Budget and an additional $17M in EAP funding to accelerate the construction of the Pangnirtung harbour in 2009-10 and 2010-11.

SCH considered options for implementing some early components of the project at Pangnirtung so that work could be undertaken in 2009/10, given the short construction season in the North. An option considered was that DFO would enter into a Memorandum of Understanding with the Municipality of Pangnirtung who would then enter into contracts locally to construct those components of the harbour. Further consideration was given to this approach and it was decided not to proceed. Subsequent to this, a number of decisions were taken to help move forward on the Pangnirtung project for 2009-10 construction season.

• DFO received special authority to enter into a non-competitive contractual arrangement with the Municipality for up to $6M of work. A contract ($5.4M) was subsequently signed on October 22, 2009 for work on these early harbour components.
  
  
• A letter of intent to enter into a contractual agreement was provided to the Municipality. The letter was sent as an indication of good faith to cover expenses incurred by the Municipality for the mobilization of the equipment, while the final contract details were established so that equipment could be shipped on site for the last sea lift.  
  
  
• A contribution arrangement ($438K) was entered into with the Municipality of Pangnirtung for road and bridge work near the harbour construction site. The contribution agreement was signed on October 21, 2009 and as of November 9, 2009, the initial work was reported as having been completed.

These are key decisions in the Pangnirtung Harbour project and the rationale for them, in addition to the project approval documents, must be fully documented.

Work is not proceeding according to the overall schedule for the project. However, according to SCH staff, Phase 1 milestones are expected to be met although less work was done in 2009-10 than was planned. Consequently, some planned expenditures for 2009-10 will slip into 2010-11 requiring cash management between years with other Small Craft Harbours’ projects.  This was done with the necessary approvals.

Governance

At the time of the readiness assessment, there was no formal governance structure in place for the Pangnirtung project.

A Project Charter was prepared but was not finalized. Roles and responsibilities for Headquarters and the regions were not clearly defined and accountabilities were not clear. Project delivery is a regional responsibility, however, because of complexities with the Pangnirtung project, HQ has played a more active role than what would normally take place. This created confusion at times over accountability for the project.
  
Two joint DFO/PWGSC committees, a Technical and a Steering Committee, were established to provide advice and oversight for the project. Terms of Reference for these committees or minutes from their meetings were not provided. In addition, a DFO Oversight Committee was established, however Terms of Reference for the Committee were not provided and minutes/records from the Oversight Committee have only been kept since October 2009.

Up to the time that this report was prepared (early February 2010), the project has been managed by the Regional Director, SCH in Central and Arctic Region, supported by the Regional Engineer. In September 2009, a decision was made that, in addition to the Regional Engineer, a dedicated project manager would be engaged.  It is expected that a manager could be in place by March. In the meantime, the Regional Director, SCH supported by the Regional Engineer and the Director General, SCH would continue to take primary responsibility for the management of the project.

Risk Management

Risks were considered but there has been no formal risk assessment carried out for the Pangnirtung project. Some risks were identified in various project approval documents but there were limited mitigation strategies indicated. Risks were also identified in the project approval document seeking approval to enter into a non-competitive contractual arrangement with the Municipality of Pangnirtung.   

Control

There are some key control elements in place for the Pangnirtung Harbour project. Committees have been established, although not yet formalized with terms of reference and maintaining records of decisions, and provide oversight on the project. In addition, the high level BIC acts as a monitoring and oversight mechanism for the project.

The hiring of a project manager, who will be responsible for finalizing a project charter and clarifying roles, responsibilities and accountabilities for the project, should enhance controls over project management.

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3.4 Modernizing Federal Laboratories

Budget 2009 provided Public Works and Government Services Canada with $250 million over two years under a centrally-managed process to undertake an accelerated investment program to address deferred maintenance at federal laboratories. The Department identified nineteen (19) proposals to access funding from the funds provided for the modernization of federal laboratories. The Department received approval for 16 projects.  Subsequently, the Department received $38.1 million to address deferred maintenance and to upgrade some of its laboratory facilities.

Project Selection

Headquarters consulted with the regions to determine which projects would be eligible for EAP funding keeping in mind the criteria that they be timely, targeted and temporary. A combination of approaches were used for project selection. For major capital projects, consideration was given to projects already planned but were not affordable. In addition, regions selected some minor capital projects based on EAP criteria. 

The Department consulted with the necessary stakeholders prior to identifying nineteen (19) projects for this initiative. Sixteen (16) projects were subsequently approved.  One of the approved projects, the National Aquatic Animal Health Program (NAAHP), was unable to proceed and may result in $300K not being spent in 2009-10. Steps were being taken to try to carry out other work in place of the NAAHP and fully utilize the available funds in 2009-10.  

Governance

Projects are delivered in the regions using a mix of PWGSC and in-house expertise to manage them. Although much reliance is placed on existing governance and budget processes both regionally and nationally, a weakness lies in the fact that these processes may not always be documented.   A high-level review of key regional risks related to the EAP initiatives was carried out in one region by the regional Finance Branch and identified a risk regarding documentation of their accountability framework.

Elements of a governance structure are in place for the Federal Laboratories projects, however, there are inconsistencies in the extent to which governance structures are documented by regions.   For example, roles and responsibilities and project governance are documented at a high level in project charters in certain regions while elsewhere, it is done in a general overview by phase and in a Project Roles Table. The Specific Service Agreements and Projects Charters with PWGSC contain high-level roles and responsibilities but do not provide sufficient details for them or to clearly assign accountabilities. 

Risk Management

On a project basis, risks are identified in documents such as the project proposals or in project charters, however risk mitigation strategies were not always apparent or clearly articulated.

A risk management methodology has not been developed and documented that could explain the need for a continuous risk management process and control that keeps track of identified risks and the mitigation strategies to manage the risks. Monitoring of the risks and mitigation strategies should be carried on a regular basis throughout the project.

In some cases, no project risk assessment or detailed work plan was necessary due to the fact that projects are small (e.g. maintenance works, roof change, etc). Management could identify and document the acceptable level of risk for their projects depending on their complexity and materiality.

Control

The organization structure differs in each region. Consequently the project management methodology varies from one region to another depending on the complexity of projects and procurement and contracting plans.

There are no standard project management procedures or directives with respect to managing project delivery. Some project management documents (e.g. PWGSC documentation, Project Management Body of Knowledge, and Treasury Board Policy on the Management of Projects) are used for guidance. Established practices and processes were followed in delivering EAP projects. Processes are often based on the team member’s ability and experience in project management and are not always documented. 

On a project basis, projects are monitored on an on-going basis through work plans, site visits and discussions with consultants, face to face conversations and committee meetings. Project officers interact on a regular basis with monitoring and communication between PWGSC and DFO project officers. However, these activities are not always documented.

Financial controls and reporting are standardized and follow the Departmental and Treasury Board policies and procedures. The monitoring of financial information is carried out by regions and headquarters. The Department’s Management Reporting System is used to track all transactions. Headquarters validate regional data and coding prior to Treasury Board reporting. Tele-conferences with regions and headquarters are held bi-weekly as a monitoring measure.

In some regions, a database is used to track project contracts and financial data. Tracking sheets roll up into a master tracking sheet to follow up on timeliness, completion dates and the requests for proposals.

3.5 Federal Contaminated Sites

The government established the Federal Contaminated Sites Action Plan, under the joint direction of Environment Canada and the Treasury Board Secretariat. Through Canada’s EAP, the federal government is providing $16.4 million to DFO over 2 years in funding for the assessment, management and remediation of federal contaminated sites.

Project Selection

The Federal Contaminated Sites Action Plan is used to allocate additional funding to address the legacy of federal contaminated sites, based on the risks they pose to human health and the environment. A government-wide risk evaluation and ranking methodology was developed to target the priority projects for action. Each year, Environment Canada compiles the results of risk evaluations that are completed by departments and agencies. It also presents funding options to an Assistant Deputy Minister Steering Committee, which is co-chaired by Environment Canada and the Treasury Board Secretariat. Among other activities, the steering committee sets project priorities, monitors progress, and makes recommendations on funding projects that deal with federal contaminated sites. These are reviewed and funding is provided. A list of priority projects is updated annually to reflect progress in dealing with known contaminated sites and the investigation of suspected sites. Specific projects selected for funding by EAP follow the standard contaminated sites selection process. 

Governance

There is a program governance mechanism to monitor allocated funds for contaminated sites. It consists of the Deputy Minister of Environment Canada, the Federal Contaminated Sites Assistant Deputy Minister Steering Committee and the Contaminated Sites Management Working Group as an advisory group. There is also Program Support for administrative functions and Program Delivery for the effective delivery of the Federal Contaminated Sites Action Plan.

The Assistant Deputy Minister level interdepartmental group has been overseeing the implementation of the EAP initiative and is composed of representatives of all custodians with contaminated sites or an interest in this program. The committee sets priorities, monitors progress, recommends funding allocations and provides program oversight.

Projects are delivered in the regions using PWGSC to manage the majority of the projects (except for Pacific region) as the procurement and contracting authority. DFO plays a project leader role. For individual projects, a Specific Service Agreement or project charter is prepared that sets out project delivery steps. The Specific Service Agreement also sets out roles and responsibilities for DFO and PWGSC; however, it does not always specify who is responsible and accountable for project delivery from a DFO perspective.   Also, the processes in place leading up to the decision to have PWGSC manage a project are not always documented.

Project management accountability appears to exist informally but is not clearly documented or communicated. A high-level review of key regional risks related to the EAP initiatives was performed in one region by the Regional Finance Branch and identified a risk regarding the documentation of the accountability framework. Roles and responsibilities are documented in various documents for project delivery at a high level (project charters, delegation of authority matrix).

Risk Management

On a project basis, risks are generally identified; however risk mitigation strategies were not always apparent or clearly articulated unless for major capital projects. Small scale projects are part of established programs for which the inherent low risk/low consequence scenarios are managed as a part of the program and ongoing project delivery.

Also, regular meetings between Real Property Technical Services staff and contracting and finance managers take place to discuss needs, requirements, concerns and options during initial EAP implementation but are not always documented.

Control

Various documents exist to support the delivery of the Federal Contaminated Sites program.  Internal processes have been developed by DFO for their management of contaminated sites submissions and projects. While the publications and guidance documents provide technical direction on the management of contaminated sites, they often do not go into detail on how to manage contaminated sites via the creation and execution of projects.

There are no documented standard project management procedures and directives with respect to managing project delivery or evidence of a documented framework for oversight, monitoring and ongoing project review. Some templates for mandatory deliverables are used to support the delivery of projects. Procedures vary depending on the project complexity, procurement and contracting plan.

Some useful project management documents such as Treasury Board’s Policy on the Management of Projects, PWGSC documentation, Project Management Book of Knowledge, and Project Initiation Guidance for Federal Contaminated Site Remediation/Risk Management Projects (2006) are used for guidance by the Regional Offices of Environmental Coordination. The Project Initiation Guidance for Federal Contaminated Site Remediation/Risk Management Projects document prepared for PWGSC clearly differentiates between project management and contaminated site management. It appears these two management areas are easily confused and therefore project management documentation should be used to guide DFO on what activities might be included as part of the initiation of a contaminated site management project.

Projects are monitored on an on-going basis through of the Offices of Environmental Coordination at HQ and in the Regions. The monitoring of financial information is carried out by regions and headquarters. Headquarters validates regional data and coding prior to Treasury Board reporting. Tele-conferences with regions and headquarters are held bi-weekly as a monitoring measure.

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3.6 Habitat Management – Mackenzie Gas Pipeline

General Observations

The Mackenzie Gas Project is a proposed $16.2 billion investment in the Northwest Territories to build a 1220-kilometre pipeline system along the Mackenzie Valley that would link northern natural gas producing wells to southern markets. Environment Canada is the lead federal department for the project.

DFO received $4.1 million in 2009-10 to continue its work on the Mackenzie Gas Pipeline related activities through the 2009 Budget as part of the stimulus funding. The funding is managed principally by the Habitat and Species at Risk Sector and by the Central and Arctic Region. 

DFO is responsible for ensuring the long-term management and the sustainability of aquatic resources for use by Canadians, including Aboriginal people and communities on the Mackenzie system, and therefore has a crucial role in the environmental assessment and regulatory review of activities related to oil and gas exploration and development in the North including both, the Mackenzie Gas Project and additional induced oil and gas exploration and development activities. 

Internal Audit Directorate staff were told that the EAP funding for the project is monitored on an on-going basis in the Central and Arctic Region and at Headquarters and that regular reporting is done through the BIC. However, the fact that there were no changes to the funding status from October 2009 to January 2010 as identified in the bi-weekly reports to BIC is an indication that close monitoring of expenditures was not taking place. This concern was addressed during the conduct of the review and no further action was deemed necessary.

It was brought to the attention of BIC on January 11, 2010 of the possibility that some funding may not be spent in 2009-10. One of the reasons given for not having expended all of the funds in 2009-10 is that the number of hours required to work on the recommendations of the Joint Review Panel report for the project were overestimated. The estimate for the work had been based on a different schedule of release of the Joint Review Panel Report for the Mackenzie Gas Pipeline.

At the time of the preparation of this report, the amount that will not be spent was not known. The funds that could not be spent in 2009-10 cannot be transferred to 2010-11 as the funding for the project through the EAP is for one year only.

3.7 Recommendations

Recommendations 1-18 are to be addressed by the Assistant Deputy Minister, Human Resources and Corporate Services. Specific areas where the recommendations apply within this section are identified before each recommendation or set of recommendations.

3.7.1 HQ / Regional Roles and Responsibilities

While existing processes and practices are used to implement EAP projects, the expectation is that there are clear roles and responsibilities set out for HQ and the Regions. 

Applies to SmallCraftHarbours, Federal Laboratories and Contaminated Sites

1.  Roles and responsibilities for HQ and the regional organizations concerning project management and the assignment of responsibility for achieving results should be clearly documented.

3.7.2 Project Identification

Small Craft Harbours was asked to submit a list of projects in the event that funding became available through Budget 2009.   The Internal Audit Directorate understands that approximately $300M in projects was identified and that only $200M became available in EAP funding. With respect to Federal Laboratories, the department had submitted 19 proposals for Federal Laboratory funding, 16 of which were approved.

2.  The process used to identify the initial $300M in projects as well as the final $200M list of SCH projects to be implemented under EAP should be documented. In addition, the process followed to identify additional EAP projects once new funds become available should be documented.

3.  The process used to identify the 19 proposals for Federal Laboratory funding should be documented.

3.7.3 Project Documentation

Projects are normally carried out in the following stages:

• Project Initiation (e.g. business case analysis or feasibility study, project charter development, Preliminary Project Approval (PPA) document preparation, communication requirements (may include a preliminary risk assessment);
  
  
• Project Planning (e.g. approved project plan including scope and schedule, cost planning, capacity and skills requirements, risk assessment, acquisition/procurement planning when applicable, Effective Project Approval (EPA) document preparation);
  
  
• Project Execution and Control (e.g. project plan execution, performance reporting, on-going risk monitoring and control, monitoring contracted deliverables); and
  
  
• Project Closure (e.g. contract close-out activities, Post –Project review, Project Close-out Report).

It is the expectation that the activities and decision making within each phase of a project would be fully documented. A project management framework should be appropriate to the size and complexity of projects. For smaller projects, project management frameworks could be simplified or cover multiple projects.

Applies to Small Craft Harbours, Federal Laboratories and Contaminated Sites

4.  The process for and the preparation of a project management framework that would cover all phases of project management (including templates if considered necessary) should be documented. The following could be included in a standard project management framework.

• Identification of project leader and project manager
• Project Description/Objective
• Resources involved in project delivery
• Roles and responsibilities
• Authorities
• Accountabilities
• Oversight Mechanisms
• Procurement Strategy
• Communication Strategy
• Monitoring Requirements
• Reporting Requirements
• Project Close-out Requirements

5.  A checklist that outlines each step in the project management process as well as the documentation requirements should be developed and applied.

3.7.4 Risk Management

Risk assessments should be carried out for all projects, regardless of size.  A risk assessment should identify risk and mitigation strategies as well as how they will be monitored and updated regularly during the course of the project. It should also clearly identify who is accountable for managing the risks. The risk assessment also documents the risks that are accepted and the rationale for doing so.

Applies to Small Craft Harbours, Federal Laboratories and Contaminated Sites

6.  The process for and the development of project risk assessments should be documented. The process should identify the methodology to be used in identifying risks, the mitigations to manage the risks and how they should be monitored and updated regularly during the course of the project. The results of the risk assessments should also be appropriately documented.

3.7.5 Oversight Mechanisms

Oversight on projects helps ensure that a project is proceeding as planned, deliverables are on time and within budget and that appropriate management practices are being adhered to.

Applies to Small Craft Harbours, Federal Laboratories and Contaminated Sites

7.  A description of the oversight mechanisms in place for project management should be prepared. If the oversight mechanism is a committee, then there should be a formalized terms of reference for that committee and records maintained of the meetings held and decisions taken.

8.  The processes in place for monitoring the status of implementation of projects from a financial and non-financial perspective should be documented.  

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3.7.6 Projects Managed by PWGSC

For projects managed by PWGSC, there is a process that must be followed within DFO from the time projects are identified to the time arrangements are entered into with PWGSC. This process is not documented.

Specific Service Agreements and Project Charters are prepared between DFO and PWGSC for jointly managed projects. These documents provide broad statements of roles and responsibilities and are not necessarily specific enough to provide clear direction to those involved in project management. For example, the Project Charter refers to the Project Leader as DFO. This is not specific enough to hold anyone accountable for the project.

Applies to Small Craft Harbours, Federal Laboratories and Contaminated Sites

9.  The process that takes place from project approval to the time the arrangements are entered into with PWGSC for project delivery should be documented.

10.  The DFO roles and responsibilities set out in the PWGSC Project Charter should be further refined and documented, outside of the project charter.

3.7.7 Pangnirtung Harbour

11.  A dedicated Project Manager should be appointed for the Pangnirtung Project.

12.  A Project Management Framework should be put in place that includes the following:

• Identification of project leader and project manager
• Project Description/Objective
• Resources involved in project delivery
• Roles and responsibilities
• Authorities
• Accountabilities
• Oversight Mechanisms
• Procurement Strategy
• Communication Strategy
• Monitoring Requirements
• Reporting Requirements
• Project Close-out Requirements

The project brief included in the project approval document includes elements of a Project Management Framework and could form the basis of the preparation of a project charter.

13.  A risk management strategy should be prepared for the Pangnirtung Harbour project. The risks and mitigation strategies should be identified, and monitored and updated regularly during the course of the project. Accountabilities should be assigned for the implementation of the strategy.

14.  The Committees in place for the project, (Technical, Oversight and Steering), should be formalized with terms of reference, confirmation of membership and records of meetings kept.

15.  Financial mechanisms and authorities should be reviewed to ensure that they are in compliance with Treasury Board and departmental policies.  

16.  All circumstances around potentially contentious areas should be fully documented. These include:

• the sole source contract with the Municipality of Pangnirtung;
• the contribution to the Municipality of Pangnirtung for bridge and road work; and
• the Letter of Intent with the Municipality of Pangnirtung.

17.  A monitoring plan should be established for overseeing the contract with the Municipality of Pangnirtung.

18.  A contingency plan should be prepared to deal with the possibility that EAP funds may slip in 2010-11 and DFO will have to fund the project out of its own funding.

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4.0 Conclusion

Most of the EAP initiatives being implemented by DFO are an acceleration of the work that was already being carried out by the Department. The Department has taken steps to implement its EAP initiatives using existing governance structures, processes and practices. The major weakness is that the structures and practices are not always documented. Documentation of these structure and processes must be done to be able to demonstrate that an effective management control framework is in place.

The exception to the implementation of most EAP projects is the construction of a small craft harbour at Pangnirtung, Nunavut. This project is unique given the set of challenges that it is facing, such as limited experience in delivering projects in the North and the shortened construction season. A management control framework will have to be developed around this project to ensure that there is an effective use of EAP funding.

5.0 Management Action Plan

Recommendations	Management Action Plan	Status Report Update
		Actions Completed	Actions Outstanding	Target Date
Recommendations 1-18 are directed to the Assistant Deputy Minister, Human Resources and Corporate Services
SCH, Federal Laboratories and Contaminated Sites 1.  Roles and responsibilities for HQ and the regional organizations concerning project management and the assignment of responsibility for achieving results should be clearly documented.	SCH (Director General, Small Craft Harbours)
	A draft Service Delivery Agreement for the period 2009-10 and 2010-11 was drafted earlier in 2009/10 but has yet to be finalized. The draft Agreement will be reviewed by the SCH National Management Committee and then be submitted for formal sign-off by the Assistant Deputy Minister, Human Resources and Corporate Services, Regional Directors General and the Director General, SCH. In addition, the functional structure chart developed in 2008 as part of the SCH functional review exercise addresses this issue. Headquarters is responsible for program oversight, strategic direction, policy direction and guidance, budget setting, and project recommendations and regions are responsible for project identification, project implementation, respecting delegated contracting and program authorities, and expenditure management.			March 31, 2010
	Federal Laboratories (Director General, Real Property, Safety and Security)
	All of the 16 approved Modernizing Federal Laboratories projects are being implemented in the regions. Roles and responsibilities between Headquarters and the regions are the same as those followed within the long term capital management program. Real Property will prepare a roles and responsibilities document to consolidate this process. The document will be reviewed by the National Real Property Management Committee which consists of the Director General, Real Property, Safety and Security, Regional Directors of Real Property and Headquarters Directors.			April 30, 2010
	As with the Investment and Divestiture portfolios, Headquarters is responsible for program oversight, strategic direction, policy direction and guidance, budget setting, and project approval recommendations. Regions are responsible for project identification, project implementation, respecting delegated contracting and program authorities, and expenditure management. For EAP, the same process is being followed and will be documented in a one page roles and responsibilities document for the master file.			April 30, 2010
	Contaminated Sites (Director General, Real Property, Safety and Security)
	Roles and responsibilities between Headquarters and the regions are similar to those followed for the approval and allocation of environmental compliance funding. The Office of Environmental Coordination will prepare a roles and responsibilities document to consolidate and clearly define this process. The document will be prepared in consultation with the Regional Environmental Coordinators (Environment Subcommittee) and reviewed by the National Real Property Management Committee which consists of the Director General, Real Property, Safety and Security, Regional Directors of Real Property and Headquarters Directors.			March 31, 2010
	Some elements of contaminated sites project management are similar to the environmental compliance portfolio; however Federal Contaminated Sites Action Plan Secretariat procedures and directives also determine project management roles and responsibilities. For Federal Contaminated Sites Action Plan specifically, the Office of Environmental Coordination at Headquarters is responsible for coordination and liaison with Federal Contaminated Sites Action Plan Secretariat and central agencies (program oversight, national policy direction, program level reporting), coordination of project submissions and budget allocation and redistribution. Regions are responsible for project identification, project implementation, respecting delegated contracting and program authorities, expenditure management and reporting. For contaminated sites project management in general, this will be outlined in a roles and responsibilities document. An addendum specifically for EAP roles and responsibilities will also be produced.			April 30, 2010
SCH 2.  The process used to identify the initial $300M in projects as well as the final $200M list of SCH projects to be implemented under EAP should be documented. In addition, the process followed to identify additional EAP projects once new funds become available should be documented.	SCH (Director General, Small Craft Harbours)
	SCH will formally document the processes used for the identification of the $300M, $200M and potential new funding project listings, which will include the Priority Ranking systems utilized for Major Capital and operations and maintenance funding, as well as the budget allocation process to allocate funds to regions.   This will complement correspondence related to the identification of potential and final projects at the onset of the EAP which is kept in binders in the SCH Director General’s office and is available for review at any time. Copies of all correspondence will be placed on official departmental files at the end of the EAP program. The official call letter for the 2010-11 SCH Expenditure Plan was sent to regions in December with the objective of finalizing the Plan and sending it to the Minister for approval in late January or early February.			May 31, 2010
Federal Laboratories 3.  The process used to identify the 19 proposals submitted for Federal Laboratory funding should be documented.	Federal Laboratories (Director General, Real Property, Safety and Security)
	Real Property will formally document the process used for the identification of the 19 proposals that were submitted which resulted in the final approval of 16 projects, totalling $38.1M, under the Modernizing Federal Laboratories EAP initiative. This will complement correspondence related to the identification of potential and final projects at the onset of the EAP. Copies of all correspondence will be placed on official departmental files at the end of the EAP program.			March 31, 2010
	In anticipation that Real Property may receive additional funding further to the list of projects that Real Property submitted in December, Real Property developed a process to rate and rank the new list of projects. This process, which is a modified version of the current minor capital process, was completed in January and is ready to be implemented should DFO be advised that some or all of the funding requested will be allocated to DFO.			January 15, 2010
SCH, Federal Laboratories and Contaminated Sites 4.  The process for and the preparation of a project management framework that would cover all phases of project management (including templates if considered necessary) should be documented. The following could be included in a standard project management framework: Identification of project leader and project manager Project Description/Objective Resources involved in project delivery Roles and responsibilities Authorities Accountabilities Oversight Mechanisms Procurement Strategy Communication Strategy Monitoring Requirements Reporting Requirements Project Close-out Requirements	SCH (Director General, Small Craft Harbours)
	SCH will formally document the process for project management approval and execution.			May 31, 2010
	Federal Laboratories (Director General, Real Property, Safety and Security)
	Real Property will formally document the processes being followed for project management (framework) and execution.			May 31, 2010
	Contaminated Sites (Director General, Real Property, Safety and Security)
	The Office of Environmental Coordination at Headquarters, in consultation with the Regional Offices of Environmental Coordination, will develop a national project management framework specific to contaminated sites.   The framework will consider the range and complexity of contaminated sites projects in terms of size, cost, and type of project (assessment, remediation, risk management, etc.)  A survey of existing Regional Offices of Environmental Coordination project management frameworks will be compiled and assessed in advance.			April 30, 2010
	National checklists, templates and tools to formally document project management phases will be developed as appropriate.			April 30, 2010
	Existing regional approaches and tools will be formalized where appropriate.			May 31, 2010
SCH, Federal Laboratories and Contaminated Sites 5.  A checklist that outlines each step in the project management process as well as the documentation requirements should be developed and applied.	SCH (Director General, Small Craft Harbours)
	SCH will develop a checklist document as per the recommendation.			May 31, 2010
	Federal Laboratories (Director General, Real Property, Safety and Security)
	Real Property will review current practices and if necessary, either develop or modify a checklist to document each step in the project management process as per the recommendation or ensure that existing checklists are part of the process.			May 31, 2010
	Contaminated Sites (Director General, Real Property, Safety and Security)
	Regional checklists and templates will be developed (where necessary) that comply with the national project management framework, but allow for regional differences and project delivery models.			May 31, 2010
SCH, Federal Laboratories and Contaminated Sites 6.  The process for and the development of project risk assessments should be documented. The process should identify the methodology to be used in identifying risks, the mitigations to manage the risks and how they should be monitored and updated regularly during the course of the project. The results of the risk assessments should also be appropriately documented.	SCH (Director General, Small Craft Harbours)
	Risk analyses are done for all SCH major capital projects greater than $1M. SCH will prepare a document outlining the process to be followed by regional staff in developing individual project risk assessments, utilizing a model in use in Pacific region and adapting it, as applicable, to the national level. SCH will ensure that the results of risk assessments are documented as appropriate.			May 31. 2010
	Federal Laboratories (Director General, Real Property, Safety and Security)
	Risk analyses used for major capital projects greater than $1M under the long term capital planning framework currently in place will be updated for use on all the 16 EAP projects. These risk assessments incorporate all the subcomponent projects. As part of the approval of the 16 projects they have authority to adjust funding amongst sub-component projects since they were all approved with indicative cost estimates. Real Property will ensure that the results of risk assessments are documented as appropriate.			May 31, 2010
	Contaminated Sites (Director General, Real Property, Safety and Security)
	Existing Federal Contaminated Sites Action Plan Secretariat and DFO specific documents address the technical risk component of contaminated sites projects. As stated in the assessment findings, there is confusion between contaminated sites risk management and overall project management risk. Risk management approaches to identify, mitigate and manage project management risks will be developed and implemented. These approaches will be categorized by project type, size and cost so that a risk-based approach to project risk management is realized. A distinction between project management and contaminated sites technical risk will be clearly differentiated. Given that the Federal Contaminated Sites Action Plan program has been designed to allow for project substitutions and flexibility with respect to project implementation, risk management efforts will focus on the risks of annual and bundled project delivery for each stream of contaminated sites projects. A framework will be put in place so that the results of risk assessments will be documented as appropriate.			May 31, 2010
SCH, Federal Laboratories and Contaminated Sites 7.  A description of the oversight mechanisms in place for project management should be prepared. If the oversight mechanism is a committee, then there should be a formalized terms of reference for that committee and records maintained of the meetings held and decisions taken.	SCH (Director General, Small Craft Harbours)
	SCH will document the oversight mechanisms in place such as the SCH National Management Committee, regional oversight meetings, meetings with PWGSC (national and regional), etc.			May 31, 2010
	Terms of Reference for the National Management Committee have been drafted and are currently under review by the Committee. They will be finalized by the end of February, 2010.			February 26, 2010
	Federal Laboratories (Director General, Real Property, Safety and Security)
	Oversight mechanisms are already in place such as the National Real Property Management Committee, regional oversight meetings, meetings with PWGSC (national and regional), etc. These will be documented.			May 31, 2010
	While it has been a topic of discussion at most National Real Property Management Teleconferences, EAP will be added to the agenda as a standing item from now unit full completion of EAP			January 27, 2010 (Complete)
	There is a terms of reference for the National Real Property Management Committee. A modification to the term of reference will be made to specifically outline the role of the committee with respect to EAP			March 31, 2010
	Contaminated Sites (Director General, Real Property, Safety and Security)
	Oversight mechanisms are in place such as the Environment Subcommittee of the National Real Property Management Committee, regional team meetings and project management documentation with PWGSC (such as project trackers).   These processes will be documented and available nationally.			April 30, 2010
	Implementation of the EAP and baseline contaminated sites program is the subject of most bi-weekly Environment Subcommittee teleconferences. EAP will be added to the agenda as a standing item from now until full completion of EAP. Environment subcommittee agendas and minutes are located on the Environment National Drive which is accessible by all regions.			February 4, 2010
	There is a terms of reference for the Environment Subcommittee. A modification to the terms of reference will be made to specifically outline the role of the committee with respect to EAP.			February 18, 2010
SCH, Federal Laboratories and Contaminated Sites 8.  The processes in place for monitoring the status of implementation of projects from a financial and non-financial perspective should be documented.	SCH (Director General, Small Craft Harbours)
	SCH will document the oversight mechanisms in place for the monitoring of resources (i.e. the use of regional and national informatics tools).			May 31, 2010
	Federal Laboratories (Director General, Real Property, Safety and Security)
	Real Property collects detailed financial, contractual and project completion rate data at the regional and national level in support of project monitoring and reporting. Much of this information is provided for national reporting purposes via other committee structures such as the Budget Implementation Committee and Budget Implementation Reporting Committee. Information which is not collected and retained specifically for the two above noted committees will be retained on regional and national EAP files. Real Property uses the departmental financial system to monitor and track expenditures. The departmental financial system, in addition to the information collected above, provides a sound basis for monitoring, assessing risk and reporting.			May 31, 2010
	Contaminated Sites (Director General, Real Property, Safety and Security)
	Federal Contaminated Sites Action Plan Secretariat through the Interdepartmental Data Exchange Application governs project planning, approval and expenditure information for federal contaminated sites projects accessing project funds through the Federal Contaminated Sites Action Plan program. Mandatory reporting and attestation governs the financial management component of the Federal Contaminated Sites Action Plan program.   DFO also utilizes the Contaminated Sites Module and the DFO financial system to monitor contaminated sites projects and expenditures. The Office of Environmental Coordination has developed detailed financial project tracking tools for use in preparing bi-weekly Minister Reports as well as for central agency reporting. Explanations on the use of these tools and systems will be documented and included in the overall contaminated sites project management framework.			May 31, 2010
SCH, Federal Laboratories and Contaminated Sites 9.  The process that takes place from project approval to the time the arrangements are entered into with PWGSC for project delivery should be documented.	SCH (Director General, Small Craft Harbours)
	Refer to Recommendations #4 and 5 above. The process and checklist that will be developed will cover this recommendation.			May 31, 2010
	Federal Laboratories (Director General, Real Property, Safety and Security)
	A decision tree will be developed to demonstrate this process and it will form part of project files.			April 30, 2010
	Contaminated Sites (Director General, Real Property, Safety and Security)
	A process and checklist will be developed as part of the project management framework outlined in the action plan for Recommendation #4.			April 30, 2010
SCH, Federal Laboratories and Contaminated Sites 10.  The DFO roles and responsibilities set out in the PWGSC Project Charter should be further refined and documented, outside of the project charter.	SCH (Director General, Small Craft Harbours)
	SCH will develop a document to clarify and define the DFO roles and responsibilities referred to in PWGSC Project Charters.			May 31, 2010
	Federal Laboratories (Director General, Real Property, Safety and Security)
	Real Property will develop a document to clarify and define the DFO roles and responsibilities referred to in PWGSC Project Charters.			April 30, 2010
	Contaminated Sites (Director General, Real Property, Safety and Security)
	The Office of Environmental Coordination will develop a document to clarify and define the DFO roles and responsibilities outlined in PWGSC Project Charters as part of the project management framework outlined in the action plan for Recommendation #4.			May 31, 2010
Pangnirtung Harbour Recommendations 11-18
11.  A dedicated Project Manager should be appointed for the Pangnirtung Project.	SCH (Director General, Small Craft Harbours)
	A dedicated Project Manager is in the process of being acquired and is expected to be in place by early February.			February 2010
12.  A Project Management Framework should be put in place that includes the following:	SCH (Director General, Small Craft Harbours)			February 2010     All remaining measures will be the respon- sibility of the Project Manager working in conjunction with regional and Head- quarters SCH staff and the offices of the ADM, Human Resources and Corporate Services and the Regional Director, Central and Arctic and the Internal Audit Directorate. These measures will take place during the period February to May, 2010. Some measures will be completed earlier than others during this period.
	In collaboration with staff at Headquarters and in the Central and Arctic Region, the Project Manager will continue to gather, finalize, and develop where necessary framework documentation as suggested and ensure that this task is completed by May 1, 2010. Observations on specific items follows:
Identification of project leader and project manager	With the coming on strength of a dedicated Project Manager, the Regional Director General, Central and Arctic Region will be the responsible project leader, with continued support from regional SCH staff. The PM will also consult the Internal Audit Directorate to ensure that the requisite Project Management Framework is comprehensive and steps are undertaken to ensure adherence to the implementation plan.
Project Description/Objective	Documentation to be drawn from project approval documents.
Resources involved in project delivery	In addition to above mentioned staff resources, an additional engineer will be acquired to support the project. Financial resources to deliver the project are based on project approvals during the course of the project implementation phase.
Roles and responsibilities	Project Charter, remains to be finalized with PWGSC, and addition of Property Manager will dictate some revisions to existing roles and responsibilities across the board.
Authorities	Authorities should be drawn from project approval documents and existing policies.
Accountabilities	To be driven from roles and responsibilities above.
Oversight Mechanisms	Need to complete documentation related to roles and responsibilities of two joint DFO/PWGSC committees and DFO Steering Committee.
Procurement Strategy	Aside from special authority obtained, future procurement is expected to follow a mix of regular approaches under existing authorities.
Communication Strategy	Gather Communications components of project approval documents coupled with recent updates to specific strategy for the project.
Monitoring Requirements	Gather monitoring commitments referenced in project approval documents and include various central agency and other reporting requirements for EAP funding.
Reporting Requirements	Reporting goes hand in hand with above referenced monitoring.
Project Close-out Requirements	Ensure that financials and project reports are completed and ensure that a section on “lessons learned” is highlighted.
The project brief included in the project approval document includes elements of a Project Management Framework and could form the basis of the preparation of a project charter.	This base document to be used throughout as a starting point.
13.  A risk management strategy should be prepared for the Pangnirtung Harbour project. The risks and mitigation strategies should be identified, and monitored and updated regularly during the course of the project. Accountabilities should be assigned for the implementation of the strategy.	SCH (Director General, Small Craft Harbours)
	Gather existing documentation from project approval documents and augment as required by documenting discussions and decisions on key issues and recommendations. This may require additional documentation to Records of Decision from various applicable technical and management committees. As a starting point, project approval documents will be examined and augmented as necessary to ensure that the overall risk management strategy for the project are adequate. Risk management strategies should be identified and documented for each additional work component to be undertaken. The risk assessment will specifically include mitigation measures and accountabilities.			May 31, 2010, or earlier.
14.  The Committees in place for the project, (Technical, Oversight and Steering), should be formalized with terms of reference, confirmation of membership and records of meetings kept.	SCH (Director General, Small Craft Harbours)
	Where not already done, formalize Terms of Reference and membership for all committees and ensure Record of Decisions are kept. Specifically including the DFO/PWGSC Technical Committee, the DFO/PWGSC Steering Committee, and the DFO Oversight Committee.			May 31, 2010, or earlier.
15.  Financial mechanisms and authorities should be reviewed to ensure that they are in compliance with TB and departmental policies.	SCH (Director General, Small Craft Harbours)
	Ensure that all authorities and financial transactions used to implement the project are vetted, through regular operating procedures, by departmental financial advisors, procurement offices, and Legal Services as required. Should special circumstances arise, appropriate guidance will be sought from these or other functional groups.			May 31, 2010, or earlier.
16.  All circumstances around potentially contentious areas should be fully documented. These include: the sole source contract with the Municipality of Pangnirtung; the contribution to the Municipality of Pangnirtung for bridge and road work; and the Letter of Intent with the Municipality of Pangnirtung.	SCH (Director General, Small Craft Harbours)
	Gather documentation from existing base documents, e.g. project approval documents, and augment as required with additional information and applicable Record of Decisions to support decisions on key issues, options, and recommendations leading to decisions on these actions.			May 31, 2010, or earlier.
17.  A monitoring plan should be established for overseeing the contract with the Municipality of Pangnirtung.	SCH (Director General, Small Craft Harbours)
	Document existing monitoring commitments in the project approval documents and in the contract documentation, review for adequacy, and augment as required.			May 31, 2010, or earlier.
18.  A contingency plan should be prepared to deal with the possibility that EAP funds may slip in 2010-11 and DFO will have to fund the project out of its own funding.	SCH (Director General, Small Craft Harbours)
	Current strategic discussion on approach to implementing remainder of Phase 1 and the implementation of Phase 2 are including EAP funding considerations and project cash flow requirements. If 2010/11 EAP funding should prove to be at risk, the financial contingency would be the other capital funding allocated to the project or in the final eventuality, if required, be augmented by regular SCH funding. Certain Phase 2 options under consideration could include providing for the addition/expansion to some initial variable harbour infrastructure components at a post construction stage using regular program funding. Ensure that documentation reflects these deliberations, strategies, and decisions. Continue to advise and discuss evolving project issues with central agencies.			May 31, 2010, or earlier.