Opening Statement to
the Committee On Public Accounts
Chapter 16 - Management of the Social
Insurance Number (September 1998 Report)
19 November 1998
L. Denis Desautels, FCA
Auditor General Of Canada
Thank you, Mr. Chairman. I am pleased to have this
opportunity to appear before the Committee to discuss
Chapter 16 of my September 1998 Report, Management of the
Social Insurance Number.
In Chapter 16, we point
out that the Social Insurance Number (or SIN) has become
the gateway to a multitude of federal and provincial
programs. The SIN is used to identify and
gather information on taxpayers and social program
recipients, to verify entitlement to certain types of
pensions and benefits, and to match and exchange data
among programs.
The SIN was originally
intended for use as a file number for Unemployment
Insurance, Canada Pension Plan and Quebec Pension Plan
clients. Today, over 20 federal statutes, regulations and
programs authorize the use of the SIN. Its use has also
expanded to provincial social programs and to the private
sector.
Roles and responsibilities with regard to the SIN are
shared among various federal departments and agencies.
Human Resources Development Canada issues SINs, maintains
the Social Insurance Register and investigates suspected
abuse. The Treasury Board is responsible for the policy
and guidelines that govern the collection and use of the
SIN. The Office of the Privacy Commissioner investigates
complaints about the SIN. The Department of Justice
responds to general inquiries from the public on the
private sector's use of the SIN.
The Social Insurance Register is managed in Bathurst,
New Brunswick. About one million cards are issued each
year. Annual operating costs are $7 million, $2 million
of which is collected from applicants for replacement
cards. The remaining $5 million in costs is divided among
the main users of the SIN - Revenue Canada, the Canada
Pension Plan, the Quebec Pension Plan and the Employment
Insurance Account.
Integrity of the Social Insurance
Register
The audit uncovered a
number of weaknesses in management of the Social
Insurance Number. Birth and death
information on SIN holders is not always complete and
accurate. For example, there are nearly four million more
Social Insurance Numbers than there are Canadians aged 20
or older. Moreover, 11.8 million numbers have not been
certified; valid SIN cards are held by thousands of
individuals with no legal status in Canada.
Since the mid-1990s, the branch responsible for the
Social Insurance Register has been receiving information
from Revenue Canada, Citizenship and Immigration Canada,
the Canada Pension Plan and the Quebec Pension Plan.
However, these sources of information are not being fully
exploited and more could be done to obtain information
from vital statistics bureaus in the provinces.
The weaknesses found are
detrimental to the proper management of social programs.
They may lead to errors, abuse and fraud and,
collectively, the impact could be sizable. There is an
urgent need for action in order to protect public funds
and taxpayers.
The Minister of Human Resources Development, the
Honourable Pierre S. Pettigrew, has accepted our
recommendations. He has stated that his department has
already begun improving the integrity of the information
contained in the Register, and that the department is
working with provincial governments to improve the
situation.
The Committee may wish to obtain from departments
commitments and timetables for implementing specific
action plans to improve the integrity of the Social
Insurance Register.
Roles, objectives and uses of the
Social Insurance Number
Another reason I am concerned about
the widespread use of the Social Insurance Number is
because it undermines privacy protection.
I believe it is time to review the current roles,
objectives and uses of the Social Insurance Number. The
government should determine what it wants to do with the
Social Insurance Number and, at the same time, study
other possible options. I also believe it is essential
that Parliament play a major role in debating these
issues and in finding a satisfactory solution.
The Committee may wish to consider recommending that
Parliament clarify - through the appropriate committees -
the roles, objectives and uses of the Social Insurance
Number. Parliamentarians could then debate the other
possible options, and clearly set out the appropriate
levels of integrity of the Social Insurance Register and
of privacy protection.
Mr. Chairman, that concludes my remarks. We would be
pleased to answer questions from members of the Committee.
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