Internal audit of the resettlement assistance program – income support

Internal Audit & Accountability Branch
11 June 2019

Table of Contents

I. Background

Introduction

  1. The audit of the Resettlement Assistance Program – Income Support (RAP-IS) was included in the Department’s 2018-2020 Risk-Based Audit Plan which was reviewed by the Departmental Audit Committee (DAC) at the February 2018 meeting and subsequently approved by the Deputy Minister.
  2. The Resettlement Assistance Program is a grants and contributions program created to provide direct financial support and fund the provision of immediate and essential services to Government Assisted Refugees and other eligible recipients upon their arrival to Canada. This program includes two components: provision of immediate and essential services for up to six weeks and income support for up to one year and in exceptional circumstances up to 24 months.
  3. Income support is financial assistance provided by the Department and usually disbursed on a monthly basis. It is intended to provide support for essential needs such as initial household start-up expenses, and basic monthly needs such as shelter, food, incidentals, transportation, and communication. Amounts for food, incidentals, and shelter are to be in accordance with prevailing provincial social assistance rates available in the recipient’s province of residence. Between 2016 and 2018 approximately 18,000 recipients received income support payments totaling around $164,000,000. Specifically, $101,000,000 in fiscal year 2016-17 and $63,000,000 in fiscal year 2017-18.
  4. Delivery of the Program resides within the Settlement and Integration Sector’s Settlement Network Branch and is delivered across four regions within 18 local offices by RAP-IS teams usually comprised of a manager, supervisor, program officer and support clerk. Support and guidance are provided from six additional branches within three sectors: Operations Sector – International Network Branch for functional guidance; Settlement and Integration Sector – Settlement Network Branch for management of operations and budget, Settlement Integration Policy Branch for policy development and interpretation; Corporate Management Sector – Financial Management & Deputy Chief Financial Officer Branch for financial support, Financial Operations Branch for accounts receivables and Chief Human Resources Officer Branch for learning and development, and the procurement of furniture.

II. Audit objective, scope, and methodology

Audit objective and scope

  1. The audit objective was to assess the adequacy of selected elements of the management control framework for the RAP-IS, specifically in the areas of governance, control activities and risk management.
  2. Four criteria were selected to evaluate the extent to which the Department has met the audit objective:
    • A governance structure that identifies roles, responsibilities and accountabilities to support the oversight of the RAP-IS has been established and communicated across all regions.
    • Training, tools and guidance have been developed, are consistent and accessible to RAP-IS program officials.
    • Mechanisms are in place to measure and monitor RAP-IS, and adjustments to program design/delivery are made as required.
    • A fraud risk management process has been developed and implemented to identify, assess, and mitigate fraud risks.
  3. The audit scope covered the time period from fiscal years 2016-2017 and 2017-2018 and included an assessment of the governance, various control activities and fraud risk management for the Income Support portion of the Resettlement Assistance Program.
  4. The audit did not include an assessment of the operating effectiveness of the financial controls in place as the Internal Controls team under the Financial Operations Branch of IRCC conducted this work concurrently.

Methodology

  1. During the planning phase, the audit team did some on-site exploratory work in two regions to inform the development of the audit program and conducted some on-site testing within three regions during the execution phase. The site visits took place in August and December 2018 respectively. The following audit procedures were performed:
    • Interviews with specific RAP-IS senior managers, supervisors, officers and clerks in National Headquarters (NHQ), and the Vancouver, Edmonton, Calgary, Winnipeg, Etobicoke, Hamilton, Ottawa, and Halifax regional offices;
    • Review of recipient files; and
    • Review of key supporting documents and relevant background documentation such as federal, departmental and regional policies, directives, guidance, tools and training material.

The audit observations, conclusions and recommendations are based on the work performed.

Statement of conformance

  1. This audit was planned and conducted in conformance with the Institute of Internal Auditors International Professional Practices Framework, as supported by the results of the IAAB’s quality assurance and improvement program.

III. Audit findings and recommendations

Governance and oversight

Governance

  1. Having an established, documented governance structure with clearly defined accountabilities contributes to effective oversight and decision-making helping to ensure the Program successfully achieves its goals and objectives.
  2. The RAP-IS organizational structure has undergone significant changes over the last few years. As a result, the current governance structure has not yet been fully documented. It currently spans six branches under the responsibility of three departmental sectors. Accountability for the Program is shared between: the Settlement and Integration Sector accountable for the Program’s budget, operations, delivery and policy, and the Corporate Management Sector, responsible for forecasting and budget allocation. Provision of functional guidance to regional staff is the responsibility of the International Network’s Resettlement and Operations Division residing within the Operations Sector.
  3. NHQ stakeholders involved in program delivery identified room for improvement in the governance structure for RAP-IS with regards to the provision of functional guidance from the Operations Sector to regional staff in the Settlement and Integration Sector. No formal mechanism exists to ensure that the Settlement and Integration Sector at NHQ has been made aware of all functional guidance being provided by the Operations sector to the regions.
Resettlement Assistance Program – Income Support
Graphic described below
Exhibit created by audit team
Text version: Resettlement Assistance Program – Income Support

Resettlement Assistance Program Income Support Governance Structure

Deputy Minister:

  • Operations Sector
    • International Network
      • Resettlement Operations Division (IN-ROD)
  • Settlement and Integration Sector
    • Settlement Network
      • RAP Operations responsible for RAP Operations and IS Budget
    • Settlement and Integration Policy
      • RAP-IS Policy responsible for RAP-IS Policy

Associate Deputy Minister:

  • Corporate Management Sector
    • Financial Management & DCFO
      • National Payment and Accounting Service (NPAS)
      • Grants and Contributions Financial Management (GCFM)
    • Financial Operations
      • Accounts Receivables (A/R) responsible for NPAS duties, budgeting & forecasting
    • Chief Human Resources Officer
      • Centre of Expertise, Learning Development Division (LDD) responsible for RAP-IS training
    • Procurement

Oversight

  1. The existence of oversight bodies/functions involving relevant stakeholders, who are provided with timely and accurate program information helps to ensure management’s direction, plans and actions are appropriate and support the achievement of program objectives.
  2. There are several oversight bodies that include representation from departmental sectors responsible for RAP-IS such as the Director General Vote 10 Steering Committee and the Settlement and Resettlement Management Committee. The Program is not a regular topic of discussion at these venues. As a result, there is currently no oversight body focused on RAP-IS where senior management from the three sectors involved meet to discuss the Program and make decisions.
  3. The national Government Assisted Refugees-Resettlement Assistance Program Working Group includes representatives from the Settlement Network, Settlement and Integration Sector. The working group makes recommendations and advises IRCC senior management on how to ensure that Government Assisted Refugees and other RAP clients receive the support necessary to successfully settle and adapt to life in Canada. RAP-IS is discussed at this working group, however the main focus is overall RAP support provided to clients, often from the perspective of the provision of immediate and essential services that is delivered under the other component of the Program.
  4. In an effort to strengthen governance and oversight for both components of RAP, the Settlement Network launched in January of 2019, a recurring Director’s and Director General’s Meeting which includes representation from all three sectors involved. The Terms of Reference, membership and key roles and responsibilities have not yet been established.

Roles and responsibilities

  1. Roles and responsibilities need to be defined and communicated to those who are responsible for the achievement of the program’s objectives. When roles and responsibilities are defined and employees are made aware of them, this increases the consistency of decisions made across all regions and allows employees to know where and when they should seek the expertise required to make decisions.
  2. While the roles, responsibilities and accountabilities with regard to the RAP-IS for NHQ and for regional staff delivering the program have been developed, they have not been revised to take into account changes made to the RAP-IS governance structure.

Monitoring

  1. Ongoing monitoring contributes to effective oversight by providing management with information that can be used to inform decision-making regarding program design and delivery.
  2. The only monitoring requirements identified by NHQ for RAP-IS are those used to inform forecasting and budget allocation exercises and set targets for the number of recipients expected to be served by the program. NHQ has not developed a monitoring strategy to support oversight and inform program delivery. Regions maintain various types and levels of program statistics in an effort to provide regional management with a better understanding of operational pressures and needs. For instance, one region creates monthly dashboards of program delivery statistics including, the number and type of refugees arriving, the average time needed to conduct a recipient orientation and the average number of business days to receive a start-up cheque. The information being collected is not systematically being shared with NHQ.
  3. The lack of a defined approach to monitoring, including the identification of key information to be used to inform decision-making as well as the limited amount of information currently being captured and reported, limits NHQ’s ability to provide effective oversight for the RAP-IS.
  4. Recommendation 1. The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should update, document and communicate the RAP-IS governance and oversight structure including roles, responsibilities, authorities and accountability related to RAP-IS.
  5. Recommendation 2. The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should develop a RAP-IS monitoring strategy to monitor program delivery towards informing continuous program improvement.

Control Activities

Training and guidance

  1. The provision of formalized training is important to ensure that staff delivers the program consistently while respecting program requirements. As such, RAP-IS staff need to be provided with the necessary training, tools, resources and information to carry out their responsibilities.
  2. In 2008 an online tool was developed to train staff on how to deliver the Program. An update to it was started in 2015, however it was put on hold due to shifting priorities. As a result, new employee training for RAP-IS consists mainly of job shadowing whereby staff learn their duties and responsibilities by observing experienced program staff. Considering that the program is being delivered by four regions all across Canada, it is difficult to ensure consistency of training when it is provided through this method, as it is based on the knowledge and particular experience of the individual being shadowed. The Learning, Development Division under the Corporate Management Sector is aware of the need to update the RAP-IS online training and is planning to do so within the next year.
  3. Guidance materials for RAP-IS in the form of policies, manuals, templates and program delivery instructions are available online to help inform staff of how to conduct their RAP-IS responsibilities. For example, how to calculate adjustments to the income support entitlement for a recipient. The RAP-IS guidance materials and templates are located on various IRCC platforms such as, Connexion, Intranet and GCDOCs and are difficult to find for the staff in charge of delivering the program in the regions. In the absence of a centralized repository, regions have developed their own. These regional repositories do not always contain the most up-to-date version of guidance and templates. For example, one region was found to still be using a previous version of the RAP-IS Agreement template between the income support recipient and the Department. Having a centralized location where all guidance and templates are maintained and updated would help reduce the risk of using outdated materials, and would help ensure that the program is being delivered consistently across regions.

Tools

  1. The provision to program officials of tools, resources and information such as software and databases help ensure the program is being delivered consistently while respecting program requirements.
  2. Across all regions in Canada, recipient files for RAP-IS are being managed through a paper-based system. A challenge encountered with using paper-based files is that the information contained cannot be readily accessed by program officials at NHQ in order to help maintain oversight or conduct various types of data and trend analysis to inform policy development and program design.
  3. With the exception of the six key documents outlined within the RAP-IS Manual there are no national guidelines outlining how files are to be maintained and what documentation must be included to ensure a consistent approach is being used. As such, each regional office has developed their own approach to file creation and to what documentation must be maintained on file. A sample of 122 recipient files reviewed demonstrated a 93% completeness rate, for the six key documents identified within guidance materials. The document found to be most often omitted from the files was the Client Receipt of Start-up Cheque, which was not included in 13 of the 122 files examined.
  4. Under RAP-IS, income support mirrors provincial social assistance rates. The calculation of individual income support benefits are made by Resettlement Assistance Program officials using regionally developed excel-based calculation tools. As these calculation tools are being maintained by each region, there is no systematic process in place to ensure that rates are being updated as directed by NHQ.
  5. An initiative is underway to transition RAP-IS from paper files to the Global Case Management System (GCMS), a single, integrated, worldwide system that is used to process immigration, refugees, and citizenship applications. Officials have informed us that this transition will take place within the year. This initiative is expected to improve the consistency of program delivery as a result of standardizing what documentation must be completed and retained on file. It will also allow program officials from NHQ direct and more timely access to information from recipient files needed to conduct various analysis. In addition, it is expected that GCMS will include a National Calculation Tool which will replace the regional calculation tools currently in use.

Quality assurance

  1. A quality assurance process is needed to verify and ensure that regions are delivering the program in accordance with established policies, guidelines and requirements, such as the need for documentation supporting decisions being made with regards to recipient IS entitlements.
  2. There was no quality assurance process with regards to recipient file creation and management for RAP-IS. As part of the file review, an inconsistent approach to file maintenance was observed across regions. The existence and adequacy of documentation on file supporting decisions taken for or against the issuance of special allocations to recipients such as, housing supplement or transportation allowances, varied across all regions. For example, in some regions having a copy of the lease agreement was a requirement to be eligible for the housing supplement under RAP-IS, while in other regions this was not the case.
  3. Anomalies and inconsistencies with regards to the reporting/tracking and collecting of overpayments were also observed. An overpayment situation occurs when a recipient receives income support to which they are not entitled. The RAP-IS Manual states that an officer must take into consideration and document on the recipient’s file: circumstances leading to the overpayment and potential hardship to the recipient.
  4. The circumstances leading to overpayment situations were documented within files. However, documented evidence to support that an assessment of hardship had been conducted by the officer as required was not observed in any of the files. In addition, there are variations as to how some regions addressed the recovery of overpayments. For example, some regions routinely refer overpayment situations to NHQ Accounts Receivable, while others deduct the overpayment from future income support payments or discontinue IS. In two other regions officers were forgiving overpayments owed without documentation to support the decision on file.
  5. Recommendation 3. The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should ensure RAP-IS guidance and training materials are current and create, communicate and maintain a centralized repository accessible to all RAP-IS officers.
  6. Recommendation 4. The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should develop a RAP-IS Quality Assurance process to review recipient files to ensure officers are consistently following program requirements and that required documentation is on file.

RAP-IS fraud risk management

  1. Integrating a fraud risk management process, that includes reporting and monitoring on potential fraud risks into a program’s governance structure helps inform and support control activities needed to detect, prevent and mitigate potential fraud risks specific to the Program.
  2. Since the RAP-IS involves an exchange of funds between IRCC and a recipient, there is an inherent risk of the potential for fraud or abuse of the Program. A Fraud Risk Management process specific to the RAP-IS, including the identification, assessment, and mitigation of fraud risks has not been developed. The guidance available to staff on how to identify potential cases of fraud is also very limited.
  3. The control identified to mitigate the possibility of fraud or abuse of the RAP-IS consists of ensuring that the recipients are made aware of their obligation to report any change in status prior to signing the RAP-IS Agreement and they are provided with the Change of Status Form at that time. This form allows recipients to advise IRCC of any change to their situation that could impact their continued eligibility to receive income support, such as earned income.
  4. There is little incentive for recipients to declare additional earnings as it could negatively impact their financial situation. Under RAP-IS, recipients are allowed to earn up to 50% of their current income support entitlement and anything above this amount could lead to the reduction or termination of income support payments.
  5. A weakness was observed with regards to this control when a number of recipients who had gained employment, but had not reported it to IRCC, were identified by a program officer via a survey completed by the Service Provider Organization. This demonstrates the need for a more proactive approach to monitoring continued recipient eligibility to reduce the likelihood for the potential abuse of the Program. Officials informed us that a draft approach to client monitoring had been developed in 2016 to help address this issue, but it has not been implemented.
  6. Recommendation 5. The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should conduct a fraud risk assessment for RAP-IS and develop and implement mitigation strategies to address the inherent risks identified.

IV. Conclusion

  1. To conclude, elements of the RAP-IS management control framework assessed as part of this audit require improvement. A governance structure is in place to support the oversight of RAP-IS, but it is not fully documented due to recent program changes. Similarly, the roles and responsibilities for program staff at NHQ and in the regions have been developed but need to be updated. RAP-IS training, tools and guidance are available for RAP-IS officials but improvements are needed to ensure they are up-to-date and accessible. Finally a RAP-IS Fraud Risk Management process has not been developed including the identification, assessment, and mitigation of fraud risks.
  2. The Department is taking steps to address a number of areas identified as requiring improvements as part of current initiatives underway. Namely, the transition from paper-based files to the Global Case Management System, planned updates to the RAP-IS online training tool, and the creation of the Director and Director General’s recurring meeting including all three sectors involved in the governance of RAP-IS.

Management has accepted the audit findings and developed an action plan to address the recommendations.

Appendix A – Management response

Recommendation 1

The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should update, document and communicate the RAP-IS governance and oversight structure including roles, responsibilities, authorities and accountability related to RAP-IS.

Management response

Management agrees with the recommendation and will enhance the existing governance and oversight structures to ensure roles, responsibilities, and accountabilities of those involved in the oversight and delivery of RAP-IS are updated, documented and communicated.

Recommendation 2

The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should develop a RAP-IS monitoring strategy to monitor program delivery towards informing continuous program improvement.

Management response

Management agrees with the recommendation and will develop a monitoring strategy to assess program delivery.

Recommendation 3

The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should ensure RAP-IS guidance and training materials are current and create, communicate and maintain a centralized repository accessible to all RAP-IS officers.

Management response

Management agrees with the recommendation and will enhance accessibility to guidance. As noted in the report, work is currently underway to update and enhance the training module for RAP-IS.

Recommendation 4

The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should develop a RAP-IS Quality Assurance process to review recipient files to ensure officers are consistently following program requirements and that required documentation is on file.

Management response

Management agrees with the recommendation and will develop a quality assurance process aligned with the GCMS functionality to ensure compliance with program requirements, which includes maintaining appropriate documentation on recipient files.

Recommendation 5

The Assistant Deputy Minister, Settlement and Integration Sector, jointly with the Assistant Deputy Minister, Operations Sector should conduct a fraud risk assessment for RAP-IS and develop and implement mitigation strategies to address the inherent risks identified.

Management response

Management agrees with the recommendation and will conduct a fraud risk assessment of the program.

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