Independent Assessment of the Polar Continental Shelf Program

Presented to the Departmental Audit Committee (DAC)
April 8, 2021

Presented to the Performance Measurement, Evaluation and Experimentation Committee (PMEEC)
March 11, 2021

Table of Contents

• Acronyms
• Executive Summary
• Introduction
• Program Profile
  • Resources
• Engagement Scope and Methods
  • Engagement Considerations
  • Objectives and Scope
  • Methods
  • Limitations and Mitigation Strategies
  • Assessment Resources and Management
• Findings
  • Relevance
  • Achievement of Outcomes
  • Efficiency of Design and Delivery
  • Efficiency in use of time and resources
• Implications for the Program in the Context of Devolution and Land Claims
• Conclusions and Recommendations
• Appendix A: Logic Model
• Appendix B: Engagement Sub-Objectives and Criteria
• Appendix C: Bibliography
• Appendix D: Financial Information
• Appendix E: PCSP Application Process

Acronyms

AINA:

Arctic Institute of North America

AL Dbase:

Arctic Logistics Database

ALT:

Arctic Logistics Team

ARI:

Aurora Research Institute

CAFATC:

Canadian Armed Forces Arctic Training Centre

CCG:

Canadian Coast Guard

CEN:

Centre for Northern Studies

CHARS:

Canadian High Arctic Research Station

CLCA:

Comprehensive Land Claims Agreement

CoI:

Conflict of Interest

DFO:

Department of Fisheries and Oceans Canada

DND:

Department of National Defence

EBP:

Employee Benefit Plan

ECCC:

Environment and Climate Change Canada

FEIS:

Field Equipment Information System

FEU:

Field Equipment Unit

GGI:

Goss Gilroy Inc.

H&S:

Health and Safety

IIA:

Institute of Internal Auditors

IM/IT:

Information Management/Information Technology

ITK:

Inuit Tapiriit Kanatami

LMS:

Lands and Minerals Sector

NRCan:

Natural Resources Canada or the “Department”

OGD:

Other Government Departments

OMU:

Office Management Unit

PCSP:

Polar Continental Shelf Program

POLAR:

Polar Knowledge Canada

PRC:

Project Review Committee

RATS:

Research and Technical Surveys Act

SOP:

Standard Operating Procedure

TB:

Treasury Board

VFM:

Value-for-Money

WARC:

Western Arctic Research Center

Executive Summary

The objectives of this engagement are to assess the relevance and performance of the Polar Continental Shelf Program (PCSP), and the adequacy of the management control framework for the effective and efficient use of Program resources. PCSP is a national service delivery agency responsible for providing logistical support to researchers from Canadian government agencies, northern communities, independent, and university groups conducting scientific activities in Canada’s Arctic. Main services include charter air transportation, accommodation at the Resolute facility, loaning of field equipment and communications to remote sites. The Program is administered by NRCan’s Lands and Minerals Sector. The annual budget for PCSP was approximately $12 million (M) (on average) during the period covered by the assessment (2014-2020).

The assessment was conducted as a joint audit and evaluation. It was guided by the following sub-objectives:

• Sub-Objective 1: To assess the extent to which the PCSP is relevant to the GoC, NRCan, and Program Stakeholders
• Sub-Objective 2: To assess the extent to which the PCSP has achieved its expected outcomes, and identify any unexpected outcomes
• Sub-Objective 3: To assess the extent to which the PCSP’s design, delivery, and performance are adequate for the effective and efficient use of resources, including the following areas: PCSP business model; PCSP management control frameworks; resource planning; PCSP management and strategy for logistics support
• Sub-Objective 4: To assess the extent to which PCSP key governance mechanisms are adequate and effective

The assessment was based on file reviews, financial analyses, a document and literature review, key informant interviews (n=47), site visit of Resolute facility, case studies of similar programs, and a survey of users (n=257).

Findings

Relevance. The assessment found that there is a continued need for logistical and equipment support for those conducting research for scientific, economic and safety reasons in the north. PCSP is aligned with federal government priorities and NRCan’s mandate. Most applications for PCSP services are accepted. Declined applications are mostly denied for safety and logistical reasons.

There are other Canadian entities that provide similar services, at least partially. None of these entities provide a service at the same scope as PCSP, both from a geographical and logistical perspective. While PCSP coordinates with other providers, it was found that there were ongoing opportunities for the Program to better coordinate with some territorial and local programs and organizations.

Effectiveness. There is evidence that the Program is effective. Users appreciate the extensive PCSP knowledge of the terrain, weather conditions and travel routes in the north. Users are generally satisfied with the Resolute facility and with the equipment provided although some users would appreciate better training on equipment assembly and operation. There is also an opportunity to improve advice related to licensing and permitting. Users are generally satisfied with the safety aspects of the Program including the response to high risk situations.

One of the prime objectives of the Program is to provide a cost-effective service for users. Overall, savings for all users are estimated to be between $16M and $20M during the five-year period of 2014-2019 inclusive.

There is evidence demonstrating the significant contribution of PCSP to northern science. PCSP-supported teams undertake research in a variety of fields, including sustainable resource management, climate change, environmental integrity and conservation, cultural history, and emergency preparedness. The research was reported in over 1,700 publications during the period of the assessment.

There are positive unintended outcomes associated with the Program, including economic and employment impacts in the north, resulting from the presence in Resolute, procurement of goods and services, and the travel activities of the users of the Program. PCSP provides a unique training opportunity for new/young researchers and it contributes to economic impact in the north, especially to the transportation and accommodation sectors. It creates learning opportunities for Indigenous youth in the north. PCSP also provides employment opportunities, but there is a general agreement that more can be done to increase the employment impact. There is also a general agreement that PCSP can further develop its partnerships with other federal departments and agencies to increase efficiencies.

With respect to the selection of applications, the Program approves most projects submitted. While interviewees agreed that the selection process in itself was adequate, the analysis of the project selection results indicates that there is an opportunity to attract more proposals with higher ratings with respect to the quality of the science and/or that engages with northern communities.

Efficiency. Despite the challenges of delivering Arctic logistical services in the north, there was evidence that the Program makes efforts to ensure financial budgets are aligned with the extent and nature of demands associated with delivering the Program as well as its approved funding. Annual expenditures generally match budgets.

In monitoring progress against its approved budget, PCSP leverages a monthly forecasting process that provides insight as to how closely the Program is aligning with approved budgets. Expenditures related to seasonal research activities typically commence by late June and continue well into September (and often later in the case of the Western Arctic/Yukon). However, the actual costs incurred in connection with these activities, including the amounts that may be recoverable from Program participants, is not known with precision until November or even later when all invoices from suppliers have been received and verified. This means that throughout much of the fiscal year, the Program lacks management capabilities including reporting to support real time financial monitoring, therefore exposing the Program to variances from budget that may not be correctable in the final quarter of the fiscal year. While a risk, this has not resulted in overspending of budgets during the period covered by the assessment. However, there is also evidence that many researchers were not being provided with invoices until several months after their time in the north and that the Program has not developed service standards related to the issuance of invoices. Late invoices prevent researchers from making fieldwork decisions based on actual invoice amounts during the field season (e.g., lower invoice amounts would allow them to extend their research activities). These delays can make it more difficult for researchers to challenge the charges and also prevents them from making informed decisions during the field season.

The assessment indicates some gaps and inconsistencies in terms of the Program’s ability to monitor and assess the application of procurement requirements (e.g. requirement for three bids, or requirement to implement Comprehensive Land Claim Agreement “CLCA” practices), as well as detect/prevent errors and delays in reporting final financial results at the Program participant project level.

The Program continues to lack the capability to demonstrate the effective and timely financial analysis that could provide timely insight around the achievement of objectives including financial efficiency. This includes, for example, reporting on the extent to which aircraft capacity was being utilized; noting that testing of a sample of Arctic research projects revealed average aircraft utilization of 20-30%. A higher rate of utilization on charter flights would reduce costs for individual users.

Many of these issues and weaknesses are directly related to limitations in key PCSP systems including the Arctic Logistics Database (the AL Dbase) that lack the capability to support effective financial oversight and management. The evidence also revealed ongoing weaknesses and gaps in the capabilities of PCSP’s equipment inventory system, the Field Equipment Inventory System (FEIS). These weaknesses and gaps have caused the Program to take a relatively conservative approach to inventory management. As a result, quantities of equipment are often maintained at higher levels than the expected demand due to uncertainties around actual quantities available to meet operational requirements.

Contributing to this area of concern is a limited governance infrastructure (e.g. formal oversight responsibilities and mechanisms, effective reporting, etc.) related to financial management, including financial planning and efficiency. The impacts of this situation include the Program having only limited insight regarding the state of its financial efficiency as well as limited financial analysis and reporting in support of decision making, and financial records that are prone to errors and/or delays due to reliance on manual practices.

While there is evidence that many researchers have long-term research agendas in the north, there was no evidence that the Program has long-term planning activities. The assessment also found that the Program does not assess federal government research needs in a formal manner. As well, there is no committee structure or other formal mechanism that would allow it to understand user needs and adapt its activity schedule accordingly.

Further, there are concerns that the Program has not implemented formal risk identification, assessment and mitigation protocols that would serve to ensure key risks (especially those that are linked to the Program’s unique environment and objectives) are managed within an acceptable tolerance. These risks include those related to health & safety, conflict of interest, compliance (including CLCA) and succession planning.

Gender-Based Analysis Plus. The GBA+ analysis indicated that program users at the Principal Investigator level of the research team are not equally distributed between males and females. The Program has not implemented measures to encourage further female participation and does not have the means to monitor the distribution of male and female researchers using the Program. There is an opportunity for the Program to involve more northerners at the project level and the staffing level. However, program documentation (GBA+ analysis) reports that service suppliers in the north employ predominantly male workers, and this indirectly contributes to an unequal distribution of program benefits.

Potential Alternatives. With respect to alternatives, there is evidence of opportunities to further develop partnerships with other organizations, including the Canadian Coast Guard and northern organizations. Alternative designs from other similar organizations include the use of multi-year plans. Other organizations in Canada that offer similar services basically operate on a cost-recovery basis. Preapproval of multi-year projects was also suggested by interviewees. Some stakeholders said that the advisory committee that was disbanded in 2016 should be reinstated. There is little support for the idea of moving PCSP to another federal entity.

Implications for the Program in the Context of Devolution and Land Claims. The assessment found that the Program has a role to play in the Government of Canada’s compliance with its legal obligations contained in modern treaties. Potential implications were identified for the following modern treaties: Nunavut Land Claims Agreement, Inuvialuit Final Agreement, Gwich’in Comprehensive Land Claim Agreement, Sahtu Dene and Metis Comprehensive Land Claim Agreement, Tlicho Agreement, Nunavik Inuit Land Claim Agreement and Yukon Agreements and their provisions relating to Comprehensive Land Claims and Self-Government agreements.  According to evidence, PCSP implemented internal processes which incorporate modern treaty implications into its operations. Renewed funding will follow the existing program’s protocols to ensure ongoing compliance. The Program is bound by the purchasing requirements set out in the Canada Land Claims Agreement (CLCA) whereby Inuit firms are to be given priority when procuring goods or services that will be consumed in Nunavut.

PCSP operates a facility (Resolute) on lands leased from the Government of Nunavut, and deploys staff in settlement land under the jurisdiction of modern treaties. There is ongoing engagement with the Hamlet of Resolute, but according to documentation the duty to consult had not been triggered. Most interviewees across categories recommended that the Program engage in stronger collaboration and partnership with communities and actors in the north. It was generally agreed that there is an opportunity for PCSP to train and hire locally (as opposed to having staff from the south), establish internship programs for northern youth, and to better support research spearheaded by (or at least aligned with the interests of) northern communities and researchers.

Recommendations

To address efficiency issues, the assessment proposes the following recommendations:

Recommendation #1. To improve efficiencies, it is recommended that:

1. Improvements be made to the Program’s governance and oversight structure as it pertains to financial planning and performance including such items as longer term financial/cash flow planning, activity planning, compliance, and efficiency in support of reliable and timely information for decision making;

   Management Response

   Management agrees.

   A review of the program’s governance and oversight structure to improve efficiencies will be conducted, including tools and procedures related to financial planning, delegation and oversight, performance, activity planning and compliance, to ensure timely and reliable information for decision-making.

   Actions include:

   • An internal review of governance and organizational structure, financial delegation and oversight tools and procedures, activity planning and compliance, financial planning and performance.
   • Results of the review will inform development of an implementation plan with milestones to address the review.
   • Roles and responsibilities to implement a record keeping system for compliance documentation (i.e. CLCA tracking, vendor lists for conflict of interest analysis) and data analysis will be identified.

   Position responsible: ADM LMS

   Due Date: Review completed by May 31, 2022. Implementation plan developed by September 30, 2022.

2. As a component of the governance structure, develop a terms of reference for a committee structure, that includes reporting guidelines, with representation from other government departments and funding agencies to ensure stakeholder considerations are taken into account within decision-making;

   Management agrees.

   PCSP agrees to create a committee structure to ensure stakeholder considerations are taken into account for decision-making.  This committee will include representation from other government departments and funding agencies. An environmental scan with representatives from key government departments and funding agencies to inform development of the committee structure and terms of reference will be conducted.

   Position responsible: ADM LMS

   Due Date: Decision on committee structure and terms of reference completed by April 30, 2022.

3. PCSP implement strategies with federal departments and northern organizations to leverage resources, increase employment and meet current and emerging needs of its users.

   Management Agrees.

   PCSP will identify and implement strategies with federal departments and northern organizations to leverage resources, increase employment and meet current and emerging needs of its users.

   Actions include:

   • A review of current strategies with federal departments and northern organizations to identify gaps and opportunities to leverage resources.
   • Development of an implementation plan with federal departments and northern organizations to increase employment and meet emerging needs of its users.
   • Implementing a monitoring system to track new initiatives aimed at increased employment and/or meeting emerging needs in the north.

   Position responsible: ADM LMS

   Due Date: Tracking system implemented by Sept 30, 2021.

Recommendation #2. For each of the Program’s internally developed tools and reports (e.g. Excel spreadsheets, databases and other tools):

1. Formally document their purpose, key users, accountability for the tool/report, source(s) of information and how/if they link with other systems including Departmental systems; and
2. Identify and document instructions and training materials on the use and maintenance of these tools to support consistency, quality control, and continuity and inform requirements in recommendation #1.

   Management Agrees.

   PCSP will document its internally developed tools and reports including key users, accountability, sources of information and how/if they link to departmental systems. Instructions and training materials on the use and maintenance of these tools aimed at supporting consistency, quality control, and continuity will also be documented.

   Actions include:

   • Identify and appraise each of the Program’s internally developed tools.
   • Document the purpose and objectives of each tool and how they link with Departmental systems.
   • Document instructions and training materials that support consistency, quality control and continuity for each tool.
   • Develop system guidelines for effective knowledge transfer including standard operating procedures or manuals.

   Position responsible: ADM LMS

   Due Date 2a): Identify the purpose of the Program’s internally developed tools and how they link with other systems by Oct 31, 2021.

   Due Date 2b): Document instructions and training materials for each tool by April 30, 2023.

Recommendation #3. Improve or replace the Program’s proprietary logistics and financial systems/tools with commercial solutions that better support integrated and reliable financial reporting, cash management, invoice management and related financial analysis.

Recommendation #4. Undertake a risk identification and assessment that will support a risk profile for the Program. This would include a focus on those risks that may be particularly relevant/unique to PCSP’s environment and objectives e.g. H&S, compliance (including CLCA), succession planning, conflict of interest, etc.

Recommendation #5. To improve efficiencies, the quality of the projects and promote gender equity and cultural inclusivity, it is recommended that the Program upgrade its systems and processes, including project selection systems and processes, to promote and monitor diversity of its clients.

Recommendation #6. In order to facilitate planning from a resource management perspective (including NRCan and other federal partners) and users’ perspective, it is recommended that PCSP pilot a multi-year planning approach.

Introduction

This document presents an independent assessment of the Polar Continental Shelf Program (PCSP). The assessment was conducted by a contracted third-party consulting team under the oversight of the Natural Resources Canada (NRCan)’s Audit and Evaluation Branch (AEB).

The objectives of this engagement are to assess the relevance and performance of the Polar Continental Shelf Program, and the adequacy of the management control framework for the effective and efficient use of Program resources. The assessment responds to Government of Canada Central Agency requirements for an independent review as a result of Budget 2019 funding.

Program Profile

The PCSP is a national service delivery agency responsible for providing logistical support to researchers from Canadian government agencies, northern communities, independent, and university groups conducting scientific activities in Canada’s Arctic. It is situated within NRCan’s Lands and Minerals Sector. Based on a defined scientific and operational review process, it also provides support, on a cost-recoverable basis, to non-Canadian scientists. The PCSP’s Ottawa logistics hub and warehouse for equipment is open year-round. The PCSP provides logistics and infrastructure support for the Canadian Armed Forces Arctic Training Centre (CAFATC), in Resolute Nunavut. Additionally, PCSP collaborates through partnership with Polar Knowledge Canada (POLAR) operating from the Canadian High Arctic Research Station (CHARS) in Cambridge Bay, Nunavut. The logistics network extends from the Canadian borders with Alaska and Greenland to the geographical North Pole, and to the southern reaches of Hudson Bay.

Annually, the PCSP provides services to as many as 1,100 scientists and users who conduct on average 140 projects across the Arctic and provide field equipment for up to 120 federal activities across Canada (for example, support for weather station maintenance and the International Boundary Commission, support for maintenance of communications equipment and networks). Main services provided by this Program to these scientists, include:

• Charter air transportation to and from remote field camps;
• Accommodations, meals, and laboratory space at the PCSP’s Resolute facility;
• Loaning field equipment;
• Fuel for camps, equipment, vehicles and aircraft; and
• Communications networks that link the PCSP with the science teams located in field camps dispersed throughout the north.

This support facilitates the work of scientists in the Canadian Arctic. It produces information related to:

• defining areas of biological, chemical and physical interest;
• renewable and non-renewable resource management;
• understanding the impact of climate change on the biological, physical and human environment in the Canadian Arctic;
• generating geological maps, surveying and mapping the Arctic;
• supporting Canada’s sovereignty of its Arctic region; and
• compiling Inuit traditional knowledge and archaeological data.

The Program’s pre-existing logic model from the PCSP Performance Information Profile was used for the assessment. It depicts the expected results of the Program relating to the activities described above. In brief, the expected outcomes include: scientists receive safe and cost effective field logistics support (immediate); research advances scientific knowledge (intermediate); Canadians have information and knowledge about Canada and its Arctic (ultimate). The full logic model appears in Appendix A.

Resources

The current annual budget for the PCSP is $12M (2014-2020), including $3.5M for personnel (including employee benefits) and $9M in operating costs. Recoverable costs are estimated at $8.6M annually. The program employs approximately 40 full-time equivalents (FTEs).

Engagement Scope and Methods

Engagement Considerations

In order to meet Budget 2019 and Government of Canada Central Agency requirements, the assessment was conducted as a joint audit and evaluation. There was also consideration of the recommendations from previous audits and evaluations. Consistent with the Treasury Board Secretariat Policy on Results, the engagement examined issues related to program relevance, effectiveness and efficiency. A risk based approach was used to establish objectives, scope and approach for the engagement. Consistent with the Policy on Internal Audit, and the Institute of Internal Auditors’ International Professional Practices Framework, the following areas were also identified as having significance in the achievement of program objectives and were therefore assessed as increased areas of risk for this engagement:

• Governance structures and processes to support the achievement of program objectives;
• Program management processes and controls to ensure that the program adheres to the Financial Administration Act (FAA), relevant Treasury Board (TB) policies; relevant legislative and policy requirements; and departmental guidance;
• Design, implementation, and operation of key financial and operational controls to support the achievement of desired outcomes;
• Considerations for GBA+ including comprehensive land claims agreement considerations, and Indigenous representation and participation; and
• Potential alternatives to program design and governance.

Objectives and Scope

Given the above considerations, the objectives of this assessment are to assess the relevance and performance of the Polar Continental Shelf Program and the adequacy of the management control framework for the effective and efficient use of Program resources. The criteria and questions used to perform the assessment are presented in Appendix B.

The assessment covers Natural Resources Canada’s, Lands and Minerals Sector’s Polar Continental Shelf Program (PCSP). In the NRCan Departmental Results Framework, the PCSP is under Department Result 1 (Canadians have access to cutting-edge research to inform decisions on the management of natural resources) of Core Responsibility 1 (Natural Resource Science and Risk Mitigation). The assessment covers the period from 2014 to 2020.

Methods

The approach and methodology used for this assessment follows the TB Policy on Results and related Standards on Evaluation. Where relevant, the approach and methodology used for this assessment also follows the TB Policy on Internal Audit, including the Institute of Internal Auditors’ International Standards for the Professional Practice of Internal Auditing (IIA Standards). These standards require that engagement work be planned and performed in such a way as to obtain reasonable assurance that the objectives are achieved. The assessment was conducted with independence, objectivity and neutrality.

The assessment includes the following methods:

Document and Literature Review – Considering the complexities of the Program, the assessment team reviewed literature and documentation, including hundreds of documents, reports and articles from government and online sources. Key documents and articles are listed in Appendix C.

Database Review – A review was conducted of program/performance information, including the databases of projects that receive support from the Program and financial worksheets.

Key Informant Interviews – The assessment team conducted 45 interviews with 47 individuals, with the following types of key informants:

• Government respondents (n=10);
• Canadian and international Arctic science experts and stakeholders (n=10);
• Program applicants including other government departments, northern organizations, domestic and international researchers; and independent domestic and international researchers and organizations (including those who are not clients of PCSP) (n=24); and
• Community members (n=3).

Interviews were conducted by phone or in person (for interviews in Ottawa). A site visit was conducted in Resolute Nunavut for four days in March 2020. The site visit allowed for interviews, document reviews, testing and observation.

Case Studies (n=7) – Case studies were conducted of other similar programs/sources of support that met the needs of northern research teams in Canada and abroad. The purpose was to identify good practices and potential opportunities for improvement. They were based on documentation and interviews with program representatives.

Online Applicants Survey – An online survey was completed to reach the successful and unsuccessful applicants in a cost-effective matter. The survey was conducted using an online survey instrument that had been reviewed by the assessment committee and some program representatives.

Table 1: Response Rates

	Frequency	Percent (rounded)
Completed	257	50.6
Partially Complete (started survey but did not fully complete)	12	2.4
Refused	18	3.5
Non-eligible	4	0.8
Non-completed	217	42.7
Total	508	100.0

Table 1: Response Rates

Table 1 illustrates the responses of successful and unsuccessful applicants to the On-line Applicants

Survey. Three columns are featured:

Completed –-Frequency 257-Percent 50.6;

Partially Complete (started but not fully completed)-

Frequency 12-Percent 2.4;

Refused-Frequency 18-Percent 3.5;

Non-eligible-Frequency 4-Percent 0.8;

Non-completed-Frequency 217-Percent 42.7;

Total-Frequency 508-Percent 100.0

Limitations and Mitigation Strategies

The following limitations and mitigation strategies for all lines of evidence for the assessment of the PCSP were identified:

• The testing and validation were impacted by COVID-19 safety measures and other precautions implemented in response to requirements of Ontario Public Health and the Department. The main implications were: (1) the assessment team’s ability to access Program documentation that was only available in hard copy at the Program’s Sheffield Road facility; and (2) in-person walkthroughs^{Footnote 1} of some processes and systems were not possible.
  • To mitigate this limitation, the assessment team worked with Program personnel to obtain electronic documentation whenever possible. In-person walk throughs of some processes and systems were replaced with interviews when required.
• As part of the analysis of efficiency, the assessment team did not manage to gain access to extensive financial information of other programs (under the case studies methodology) to compare with PCSP’s efficiency.
  • Mitigation: Although a financial comparison was not deemed feasible, it was possible to analyse alternatives in terms of the business and financial model of other programs, including their approach to cost-recovery.
• Few northern-based/community researchers were interviewed as part of the assessment.
  • The assessment team addressed this limitation in the document review by reviewing numerous documents that provided the perspective of northerners and Indigenous communities and groups, including documents from the Inuit Tapiriit Kanatami (ITK), the Senate of Canada, and the Government of Canada (see bibliography for list of documents reviewed).
• The main limitation associated with the survey is the response rate. While acceptable at above 50%, the non-response involves a margin of error that is difficult to establish beyond statistical means. Statistically, the margin of error is calculated at 4.3% (19 times out of 20).
  • The main mitigation strategy was to conduct follow-up calls and online searches to locate emails and encourage survey participation.

Assessment Resources and Management

A working group was established for the purposes of this assessment. The working group served as the main forum for coordinating program input during the course of the project. Chaired by the Senior Evaluation Manager responsible for this assessment, the working group was comprised of a limited number of sector representatives and participation by Finance Canada and the Treasury Board Secretariat.

Findings

Relevance

Is there an ongoing need for the Program?

Documentation, literature and interview evidence confirm that there is a continued need for logistical and equipment support for those conducting research in the north. When conducted in isolated areas, research in the Arctic is challenged by high risks, including difficult weather conditions, dangerous wildlife and minimal infrastructure. Safety risks are increased as many northern areas are remote and not accessible by land transportation, making them difficult to access for both researchers and first responders. Arctic science logistics is also very costly and can typically cost up to 10 times more than similar studies in southern Canada. Arctic field logistics usually is a significant share of researchers’ budgets.

By aiming to provide lower cost transportation and accommodations, efficient logistical services and adapted equipment, PCSP supports researchers conducting work in the north by providing safe conditions at a lower cost. There is also a need to support science in the Arctic: literature indicates that there is an increasing demand for Arctic Science, namely in relation to the dramatic impacts of climate change on northern regions and populations^{Footnote 2}.

The need was confirmed by interview and survey respondents. The majority said that their research activities would be significantly impacted if the Program did not exist. When asked what would have happened to their research projects in the absence of PCSP support, 45% of the respondents said that their research projects would have been cancelled entirely. Some researchers said that they would spend a significant amount of time on logistics in the absence of the Program and would likely conduct less research.

PCSP is also aligned with federal government priorities and NRCan’s mandate. According to documentation, the Program supports current governmental priorities with respect to continuing to exercise Canada’s sovereignty in the Arctic and developing greater scientific knowledge in critical areas, including the impacts of climate change. The program is aligned with the Resources and Technical Surveys Act, which states that the Minister of Natural Resources may coordinate logistics support and provide related assistance for the purposes of advancing scientific knowledge of the Arctic region and contributing to the exercise of Canada’s sovereignty in that region and its adjacent waters. According to the Act, NRCan may make recoverable expenditures on behalf of any other department, branch or agency of the Government of Canada or a province or any university, organization or person in respect of its share of the cost of any logistics support or related assistance.

The program is aligned with departmental responsibilities related to natural resource science and risk mitigation, and contributes to NRCan’s Departmental Result “Canadians have access to cutting-edge research to inform decisions on the management of natural resources”. The program is also aligned with the new Arctic and Northern Policy (ANP) Framework, and with NRCan’s Science & Technology Framework priorities.

Is the Program serving the right clientele?

Program documentation indicates that the Program is intended for researchers from federal organizations, academia, as well as researchers from other organizations, including northern organizations, and abroad. At the beginning of each year, a target is set with respect to the breakdown of each client group. According to documentation, all project requests are screened by PCSP to ensure they:

• Take place in the Canadian Arctic;
• Are from an institution that is within PCSP’s mandate to support (i.e., academic, federal or territorial governments, Indigenous and northern organizations);
• Are scientific in nature or have a formal partnership agreement (i.e., DND); and
• Are feasible for PCSP to coordinate the logistics (i.e., are within the types of services PCSP provides and are possible to deliver).

Documentation shows that during the 2014-2018 period the proportions of users have been variable between federal public servants/DND personnel (between 40% and 64% of all users) and Canadian universities (between 35% to 40% of all users). Program documentation and data indicate that the actual breakdown of projects is guided by program budget decisions that will vary from year to year. In 2018, the PCSP allocated its direct logistics support as follows: 42% to federal government; 43% to Canadian universities; and 15% to territorial governments, northern organizations (including Indigenous organizations) and foreign researchers. In terms of destinations, most projects selected are located in Nunavut (64% of all projects), or NWT (21% of all projects).

The Program accepts most of the applications it receives from outside the federal government (about 90% are successful). Declined applications are mostly denied for logistical reasons – in most cases, they are deemed not feasible or safe from a transportation perspective. A few interviewees mentioned that the Program should be providing services to Canadians as a priority; however, there is no evidence that the Program is actually supporting foreign researchers to the detriment of Canadian users. As for the quality of the applications selected, this is further discussed under Program design effectiveness.

Is the PCSP designed and delivered in a way that minimizes duplication and overlap with other programs?

While PCSP does not provide financial assistance directly to researchers, there is documentary evidence of other sources of financial support for non-government researchers doing research in the north, including the Natural Sciences and Engineering Research Council of Canada, Polar Knowledge Canada (POLAR), the Aurora Research Institute (ARI) and the Nunavut Research Institute (NRI), among others. Other organizations also provide logistical support including the Yukon Research Centre and the Western Arctic Research Center (in the NWT). Case study evidence also indicates that some organizations including The Centre d’Études Nordiques (Quebec) and the Arctic Institute of North America (AINA) provide logistical services, but are of limited regional scope. Others provide accommodations for researchers, such the ARI and the NRI.^{Footnote 3} Case studies did not reveal more cost-effective options from these organizations as they primarily function on cost-recovery models, except when they provide direct financial support to researchers.

Interviews and documentation indicate that PCSP has linkages with the above organizations and collaborates with them. This includes the Canadian Network of Northern Research Operators, a network of research support facilities providing specialized technical services to academic, government, private and international scientific research sectors.

Interviewees generally indicated that PCSP did not overlap with or duplicate the work of other programs. Researchers may use other resources depending on the nature of their work and its location (e.g., the Aurora Research Institution offers support for research in the Western Arctic). However, according to interviewees, PCSP is a unique player in the High Arctic supporting large-scale projects and providing access to remote locations with charter flights and equipment. Local providers and other existing programs are seen as complementary to PCSP. A few respondents stated that there were opportunities for the Program to better coordinate with some territorial and local programs and organizations. A number of stakeholders interviewed said that the organizations including northern research organizations and the Canadian Coast Guard, with whom they were affiliated, were open to a stronger collaboration with PCSP.

Achievement of Outcomes

Is the Program achieving its expected outcomes? What is the value-added of the Program?
Are there unintended outcomes of the Program?

The expected outcomes of the Program are illustrated in a program logic model (see Appendix A). This assessment evaluated the achievement of these outcomes and focussed on the immediate and intermediate outcomes - the provision of safe and cost-effective logistical supports to scientists, the contribution to the advancement of scientific knowledge and to the exercise of sovereignty in the Arctic.

Logistical support

According to the key informant interviews, PCSP provides a range of supports, including advice to the researchers upfront about the feasibility of doing research in specific locations at certain points in time. PCSP’s team includes staff with extensive knowledge of the terrain, weather conditions and travel experience in the north that is appreciated by most users. Survey results for this assessment show that about 95% of users were satisfied with the access to PCSP staff; 89% of users were satisfied with PCSP’s assistance with respect to planning of field activity; and 93% were satisfied with PCSP’s advice during field work. The assessment also reviewed PCSP’s own internal survey for the previous field season that showed similarly high levels of satisfaction. Most interviewees said that PCSP staff are excellent at making themselves available to provide assistance during field trips including providing assistance if unexpected events happen that force a change of plans. A number of interviewees also explained that without PCSP, they would need to spend extensive time on logistics. However, documentation indicates that advice related to licensing and permitting is problematic, as about only one-third of users are satisfied with this aspect of the PCSP advisory services.

Equipment and accommodations

The program’s service offering includes the provision of specialized equipment – ranging from winter coats to all-terrain vehicles – as well as accommodations at the Resolute facility managed by PCSP.

The Resolute facility acts as a transportation hub as well as station for PCSP staff to provide logistical services. It is also a depository for equipment and supplies (the main warehouse is located in Ottawa). According to the survey, about 25 % of the users stay overnight in Resolute during their trips in the north. According to the survey, more than 90% are satisfied with the comfort, working space, meals provided and on-site staff support of the facility.

About 40% of the users utilize some equipment supplied by PCSP. According to the survey, more than 85% of the users are satisfied with the availability of the equipment, the quality of the equipment and the service support associated with the equipment. The area where satisfaction is lowest is in the training on equipment assembly and operation although 75% of the respondents indicated satisfaction.

Safety

One of the important pieces of equipment borrowed from PCSP is satellite phones. Users explained that this is a key aspect of the safety provided by PCSP. The phones are functional from the most remote areas, and PCSP staff schedule a daily call with the researchers to ensure safety while they are in the field. Some researchers still use high frequency radio, through which PCSP also provides contact. As well, PCSP works with a network of first responders and transportation suppliers to address emergency situations. Most survey respondents (88%) were satisfied with the safety instructions provided by PCSP, and 86% said that they were satisfied with the response during high risk/crisis situations. A few key interviewees, while in minority, expressed concerns about safety management in the Western Arctic: They mentioned that PCSP might not be the best first point of contact if an emergency situation emerged given that they were located in Resolute. According to these interviewees, other authorities in the Western Arctic would be better connected with local resources to address an emergency situations.

Cost-effectiveness

As indicated in the logic model, one of the objectives of the Program has been to provide cost-effective logistical support. The Program provides this through the provision of logistical advice, equipment, accommodation in Resolute and the coordination of shared charter flights. As discussed later, the Program is based on a partial cost-recovery model, combining both recoverable expenses and the contribution of in-kind services. Recoverable expenditures include logistical support services (e.g. aircraft charters and fuel) that PCSP provides to clients, for which they receive an invoice. This includes any expenses incurred over and above the direct, in-kind support provided to a project. Equipment is provided without a fee for users (except when it is not returned), but the Program will recover costs for expendable or damaged items. Logistical advice is provided without fee. In-kind support also includes overnight lodging at the Resolute facility.

When asked about the costs and value of the services received, interviewees provided mixed views. Most said that logistical assistance and travel costs were advantageous when going through PCSP. A few interviewees said that PCSP assistance is less attractive for fieldwork in the Western Arctic, where there are more suppliers and infrastructure for logistical assistance. As mentioned earlier, this could explain why most applications for fieldwork are in Nunavut.

In terms of program support to non-government users, the documentation identifies a limited appetite from federal government departments to support scientists outside of their own department or outside of government. During the interviews, many government and non-government users requested that there be greater transparency with respect to costs.

PCSP’s financial information provides information about estimated savings for users. Financial information reports on the in-kind support provided to users (estimated in dollars), and savings for users, which are calculated by comparing the initial cost estimates of individual trips for approved projects, against the actual costs at the end of the year. Savings are achieved by PCSP through coordination of charter flights that are shared by the users. According to PCSP financial information, the annual savings varied between $1.7M (2014) and $4.4M (2015). Total savings for the period are estimated at $15.7M (2014-2019). This is added to in-kind services provided to users, that varied from $3.3M to $4.8M per year in value, for a total of $28.4M (in-kind only).

The survey of users provided another source of evidence with respect to the savings for users. The survey assessed the savings from a user perspective by asking respondents 1) what travel costs they paid during their last trip; and 2) their estimate of how much it would have cost them if they had used another service. According to the survey findings, only about 60% of the total users actually used PCSP to arrange the charter flights. However, these users report significant savings over what they would have paid if they had booked the flights themselves through other suppliers. Travel costs through PCSP for each project (which could include multiple team members) is estimated to be on average $49K per project. According to the survey respondents, they would have paid twice that cost (approximately $98K per project on average according to this assessment’s calculations) if they had gone to a supplier directly for a chartered flight. According to these numbers from the survey sample, and expanding them to the entire population of PCSP users^{Footnote 4}, total savings are estimated to be between $15M (low-end scenario) and $25M (high-end scenario). These estimates are in the range of those reported by the Program (i.e., $15.7M for the 2014-2019 period). This amount represents about 23% of the total program budget ($72.2M, excluding recoverable expenditures) (see Table 3). In other words, it is roughly equivalent to the Program’s salary costs.

Contribution to science

There is a large body of evidence demonstrating the significant contribution of PCSP to northern science. As mentioned earlier, close to half of all users said that their northern research would not have happened without PCSP, and many (40%) said that the quality of the work would be reduced without PCSP. According to the survey, significant research outputs are produced as a result of the research work supported by PCSP. Overall, survey respondents reported a total of 1,789 publications resulting from PCSP-supported projects since 2014. While the logic model focusses on the contribution to research about the Canadian “landmass”, the research areas supported, identified in PCSP documentation are broader than geo-physical research. According to the Annual Science Reports from 2014 to 2018, PCSP-supported teams undertook research in a variety of fields, including sustainable resource management, climate change, environmental integrity and conservation, cultural history, and emergency preparedness. Selected examples of studies are profiled below. The following are other examples of research projects supported by PCSP’s logistical services:

• In 2018, novel research was conducted on viruses, bacteria and parasites that could be transmitted from animals and humans, and the effects that climate change could have on the transferability of these viruses to humans. The Program also provided support to high profile wildlife researchers and to research projects on ice shelves and glaciers in the High Arctic.
• In 2016, scientists investigated craters in northern Canada to better understand formations observed on Mars, Mercury and the Moon.
• In 2017, PCSP teams focused on mining rare earth elements in Canada, such as antimony, cobalt, indium, lithium and niobium. The goal was to eliminate a knowledge gap with regard to the environmental impacts of mining these metals.

Many researchers described some of the specific strengths of PCSP that were important for their research, including the ongoing nature of the Program, and its specific ability to transport research teams in isolated areas. Because of its ongoing presence (since 1958), PCSP has allowed research teams to conduct longitudinal studies that are key in some areas of research, such as measuring the impacts of global warming, that necessitate numerous yearly data points. In other cases, such as the study of wildlife or specific terrains, it is necessary to conduct research in isolated areas that PCSP coordinates in a safe manner.

According to documentation, PCSP has a significant engagement within the ArcticNet Annual Scientific meeting, where researchers have the opportunity to discuss operations, field season needs and ongoing Arctic science with past, current and prospective clients, government officials and other national and international polar organizations. PCSP also participates in selected community events in the north:

• In 2016, PCSP supported educational initiatives including the Taloyoak Geoscience Field School (through NRCan’s GEM Program). This was a five-day education interactive activity in the areas of geology, geophysics, glaciology, digital mapping using geographic information systems and geocaching. The Program also supported the McGill Arctic Research initiative, which taught undergraduate students best practices when conducting field research in the North. In 2018, the first Sentinel North International Arctic Field School was held in Iqaluit. Students learned about the changing Arctic cryosphere, and its impacts on people and the environment through lectures, case studies and field excursions. PCSP participated by contributing their high-quality outerwear and field equipment for the duration of the school.
• PCSP participates in Winterlude’s “Cool Science Sunday”, Resolute School’s (now Qarmartalik School) Science Fair, Science Odyssey FunFest and Community Day at the PCSP Resolute Facility. Activities such as these allow for PCSP staff and researchers to communicate their projects with Canadians who otherwise may not be knowledgeable of the projects, and permit Canadians to reach out with their questions regarding Canada’s Arctic tundra.

The Program supports projects focused on traditional knowledge and contributes to the preservation of the rich repository of traditional knowledge of Arctic Peoples. According to documentation, PCSP enabled researchers to work directly with First Nations community members, and incorporate traditional knowledge into their research findings.

Interviewees also generally agreed that the Program contributes to providing a presence in the north and contributes to the exercise of sovereignty, especially the Eastern Arctic where most projects take place. Documentation confirms that most of PCSP’s activities are conducted in Nunavut, with some projects occurring in the Northwest Territories, Yukon, and at the northern tips of most provinces. Though PCSP has a base in Resolute, supported research occurs in locations nation-wide, spreading to the most remote locations in northern Nunavut.

Unintended outcomes

There is evidence that the Program’s activities (procurement and transportation) have led to positive unintended outcomes in communities, including beneficial social, economic and safety-related outcomes. Generally speaking, there is evidence of impacts on Indigenous youth and students including opportunities to learn and conduct research in the north. For example, PCSP assistance allowed a research team from a Northern community college in Yukon to involve youth in their field research. Young researchers participated in interviews with elders, who shared their extensive knowledge. Without the Program, youth would not have been able to take part in these experiences.

PCSP’s chartered flights have also been used for other purposes. Interviews with Program Management, review of departmental documents and the assessment team’s observations at PCSP’s Sheffield Road warehouse demonstrated that the Program had played a substantial role in both the Department’s but also the Government of Canada’s response to the recent COVID-19 Pandemic (see call-out box).

There have been a few cases where PCSP-chartered aircraft provided assistance to search and rescue operations or to a medical evacuation. PCSP chartered aircrafts sometimes bring materials, such as fuel containers, back-and-forth to communities, and have assisted in environmental clean-up operations. Community members interviewed during the site visit said that PCSP had increased air traffic between the community and other Canadian airports. This had reduced the costs of flights and increased the volume. A local retailer said that this had allowed the business to become more profitable because of the lowered transportation costs.

Impacts on student development

One of the major unintended outcomes of the Program is associated with the training and development of researchers. Those who apply for funding often go in the field with research assistants, junior researchers and students, who also indirectly benefit from the Program. PCSP provides these junior researchers with unique opportunities to conduct fieldwork in the north. According to the survey, over 1,200 students have participated in fieldwork in the north through PCSP. According to interviewees, some students in particular disciplines would likely go abroad to access such experience (e.g., through a foreign university), and might not return to Canada.

Procurement and northern employment impacts

PCSP’s activities involve significant procurement to northern/Indigenous organizations as well as some employment opportunities for northerners. According to documentation, PCSP annually contributes approximately $5M towards contracts with northern and/or Indigenous suppliers. Some interviewees mentioned that the Program provides employment to northerners, including community members and students. A number said that PCSP could further involve northerners with respect to the delivery of the Program itself. One interviewee stated that while the Program had hired a few Indigenous staff members, there could be further outreach by employing local rather than southern staff on rotation. A government representative said that the Program had made efforts to hire staff from Resolute. The working hours (up to 10 hours per day) had apparently been a disincentive for local candidates, and the Program has been looking at different working arrangements to facilitate hiring. The Program has used government programs successfully to hire Inuit through intern positions.

In addition to employment, the Program has contributed to impacts on other sectors of the northern economy, through services used by PCSP users, such as the use of Inuit guides and northern accommodation services. According to the survey, 80% of PCSP users stay in commercial accommodations during their projects rather than Government of Canada facilities. On average, each respondent (and his/her team) stays about 30 person-nights for his/her project.

Is the Program design effective in selecting the best applications?

Overall, there is evidence that the selection process is effective at identifying and selecting quality applications, although a small number of projects are deemed of low quality from a science perspective at the application stage.

All applications deemed within the mandate of PCSP are subject to a project selection process. Projects are evaluated for logistics feasibility, including the timing and dates requested, details on health and safety plans and field methodologies, and cost-effectiveness of PCSP coordination. The Program sets an annual target with respect to the allocation of the various user groups. According to documentation, PCSP allocates its direct logistics support as follows: 42% federal government; 43% to Canadian universities; and 15% to territorial governments, foreign researchers and northern organizations (including Indigenous organizations).

To prioritize government projects that are deemed feasible, PCSP seeks advice from a coordinator at the Director General level, nominated by each federal or territorial government for assistance with prioritizing projects for in-kind support. University projects are reviewed by a Project Review Committee consisting of scientists from academia and government with expertise in Arctic science (with a balance of gender, area of expertise, career stage and institutions). Projects are ranked based on the Review Committee Scoring Guide, which includes criteria for feasibility (including health and safety, location, costs and logistics), scientific recognition (including awards, grants, publication records), overall quality of applications, and number of students involved and degree of local involvement. Document review supported that the scoring guide was built using criteria consistent with those used by federal research funding councils.

Stakeholders interviewed as part of the assessment generally agreed that PCSP’s selection process for academic projects was adequate. Interviewees who served on the review panel had positive comments on its composition and the assessment process for university projects, although a few recommended adding northern or community representation. A number of interviewees stated that the review process disadvantages some categories of researchers, including community-based researchers, those working in the Western Arctic, social scientists and emerging researchers. The diversity aspect of the selection is further discussed in the GBA+ plus analysis section. A few stakeholders mentioned that the advisory committee (disbanded in 2016) was an effective mechanism for the Program to learn about user/stakeholders needs and how other institutions were supporting northern research.

As part of the administrative data review, spreadsheets used to calculate the total scores were examined for the 2014-2020 field seasons. According to the information, 89% of all applications from non-federal users were accepted during the period. A review of the scores indicated that many were deemed “strong” by the selection committees. However, among the projects that were accepted for support, about 7% scored low for the quality of the science (score of 1.5 or less on a scale of 3). About 2% of the projects received low scores both for science and for student/community involvement.

Efficiency of Design and Delivery

Efficiency in use of time and resources

Over the last five (5) years, PCSP has expended over $100M (see Table 3) on non-salary items, approximately half of which are recoverable from Program participants. As described in Table 2, the majority of these expenditures are related to supporting operations at the Resolute Hub (e.g. air charters, facilities maintenance, equipment, freight charges and kitchen/food purchases). Managing this volume and range of expenditures requires an appropriate level of management attention.

Like all federal Programs, PCSP seeks to support efficient use of time and resources through the development and effective use of financial management tools and techniques. These include the active use of budgets, forecasts and related reporting in support of timely decision-making, and the use of formal tools and techniques that promote value for money (VFM) while balancing the Program’s operational priorities, including those related to the health and safety of Program personnel and participants. For example, the assessment team anticipated that the Program would have developed and implemented financial management practices and related reporting that would support VFM in procurement of goods and services, including the considerable expenditures related to aircraft charters. The team also anticipated that the Program would demonstrate that the cost sharing formula would also have demonstrated good practices, such as timely invoicing of users, while balancing the principles and priorities related to both financial efficiency and operational demands.

Financial management context

Interview and observations identified that the Program’s inherently dynamic operating environment in delivering Arctic Logistics services in the North creates additional challenges in consistently demonstrating sound financial management including the development and monitoring of budgets and forecasts. That said, there was evidence that the Program makes efforts to ensure financial budgets are aligned with the extent and nature of demands associated with delivering the Program as well as its approved funding. In addition to the unique context of delivering Arctic Logistics, the Program is granted a temporary increase in its approved commitment level in order to fund expenditures. This increase is permitted under the Research and Technical Surveys Act (RATS) and, reflects the cost recovery component of its service delivery model whereby certain costs related to delivering Arctic Logistics are recoverable from Program participants. As these expenditures are recovered, they are returned to the Department to offset the temporary increase in the commitment level. While there can be several months between the Program’s incurrence of expenditures and those recovered from participants, the Program has consistently demonstrated an ability to repay the increase within the fiscal year.

Figure 1: Table Providing a View of the Program’s Typical Fiscal Year in Terms of Receipt of Departmental Funds, Arctic Training Centre and Field Research Seasons, Invoicing and Recoveries from Program Participants

	Apr	May	Jun	Jul	Aug	Sep	Oct	Nov	Dec	Jan	Feb	Mar
Receipt of Department Funds	X
DND ATC	X									X	X	X
Primary Field Research Season			X	X	X	X
Invoice Delivery to Program Participants					X	X	X	X	X	X	X
Recoveries from Program Participants						X	X	X	X	X	X	X

Text description

Figure 1 is a table that illustrates the PCSP’s Typical Fiscal Year represented by a bar chart illustrating the months where there is receipt of Department Funds (April), Department of National Defence (DND) Arctic Training Center (January-April), Primary Research Season (June-September), Invoice Delivery to Program Participants (August-February) and Recoveries from Program Participants (September-March.

Budgeting and forecasting – Arctic Logistics

The Program’s budget includes costing for the delivery of Arctic Logistics based both on the Program’s expected internal needs and the activities associated with projects that are approved for support by PCSP. Given the inherent uncertainties associated with delivering (e.g. severe weather, terrain, vast distances, etc.) and dynamic nature of Arctic Logistics, development of that budget was identified as particularly challenging.  In the interest of both meeting Program participant service requirements and avoiding overspending, the Program’s budget related to Arctic Logistics is relatively conservative insofar as it does not incorporate all potential savings associated with coordinating logistical services between two or more projects. In practice, opportunities for such coordination are actively sought by the Arctic Logistics Team (ALT) as a major value-add of the Program.

In monitoring progress against its approved budget, PCSP leverages a monthly forecasting process that provides insight as to how closely the Program is aligning with approved budgets. The assessment revealed that reporting and updating of forecasts provides useful and timely variance and other information to inform management about the need for potential corrective actions and that these are regularly reviewed and discussed with senior management. However, this level of reporting is not the case for expenditures related to ALT’s support of the annual research/field season when researchers are on-site in the north. Expenditures related to seasonal research activities typically commence by late June and continue well into September (and often later in the case of the Western Arctic/Yukon). However, the actual costs incurred in connection with these activities, including the amounts that may be recoverable from Program participants, is not known with precision until November or even later when all invoices from suppliers have been received and verified. This means that throughout much of the fiscal year, the Program lacks reliable financial management tools and reporting to support real time financial monitoring, therefore exposing the Program to variances from budget that may not be correctable in the final quarter of the fiscal year. While a risk, this has not resulted in overspending of budgets with the exception of 2015-16 when the Program recorded a deficit of approximately $338K. The financial information indicates that the Program is generally managed within budget, with a small surplus.

Figure 2: Budget vs. Actual Expenditures for 2014/15 to 2019

Text version

Figure 2 is a bar graph of budget versus actual expenditures (in 000s) for the period 2014-15 to 2018/19. It excludes recoverable amounts.

Budget 2014-15 illustrates budget and actuals of salary totaling $2426 and Operations and Maintenance (O&M) budgeted at $10,217 and actuals of $9,635

Budget 2015-16 illustrates budget and actuals of salary totalling $2735 and O&M budgeted at $8,223 and actuals of $8,561

Budget 2016-17 illustrates a budget salary of $2,820 with actuals of $2,739 and O&M budgeted at $7,696 and actuals of $7,171.

Budget 2017-18 illustrates a budget salary of $2,876 and actuals of $2,901 and O&M budgeted at

$8,143 and actuals of $7,838.

Budget 2018-19 illustrates a budget salary of $3,058 and actuals of $3,134 and O&M budgeted at $8,978 and actuals of $8,734.

Table 3: 2014-2020 Budget and Actual Expenditures Summary Demonstrating a Small Overall Surplus

	Totals (2014-2020)		AVERAGE
	Budget	Actuals	Budget	Actuals
Salary and EBP
Salary - initial allocation	$8,890,902	$16,322,621	$1,481,817	$2,720,437
Salary - transfer from DND	$5,461,223		$910,204
Salary - Misc transfers from O&M, branch, etc.	$1,954,671		$325,779
Salary Other	$867,874	$870,483	$144,646	$145,081
SALARY TOTAL	$17,174,670	$17,193,104	$2,862,445	$2,865,517
EBP	$3,663,149	$3,666,836	$610,525	$611,139
SALARY TOTAL + EBP	$20,837,818	$20,859,940	$3,472,970	$3,476,657
O&M
O&M - initial allocation	$50,192,037	$101,248,529	$8,365,339	$16,874,755
O&M - transfer from POLAR			-
O&M - transfer from DND			-
O&M - Transfers to Salary, other branches, etc.			-
O&M - Pass the Hat - ECCC			-
O&M - Budget Top Up			-
Transfer from UNCLOS
O&M- Crown disposal, GEM, Reserve	$1,407,005	$1,193,684	$234,501	$198,947
O&M TOTAL	$51,599,041	$102,442,213	$8,599,840	$17,073,702
Other O&M
Capital	$1,693,285	$1,492,266	$282,214	$248,711
O&M - Special Projects	$1,332,000	$864,748	$222,000	$144,125
O&M - Low Carbon	$30,000	$30,000	$5,000	$5,000
O&M - Pass the Hat - NRCan	$358,000	$358,000	$59,667	$59,667
O&M OTHER TOTAL	$3,413,285	$2,745,014	$568,881	$457,502
Recoverable amounts	$0	-$51,492,880	$0	-$8,582,147
Grand Totals (excludes EBP)	$72,186,996	$70,887,452	$12,031,166	$11,814,575
Difference	$0	$1,299,544	$0	$216,591
% Difference		1.83%		1.83%

Source: PCSP Financial Systems.

The frequent small budget surplus is attributable to a number of factors. These include the conservative nature of ALT’s budget development process^{Footnote 5}, a general sense of significant unplanned expenditures provided by ALT, as well as the Program’s ability to adjust spending in the final quarter of the financial year to avoid either overspending or lapses in budget dollars. However, it was also noted that researchers were not being provided with invoices until several months after their time in the north and that the Program has not developed service standards related to the issuance of invoices. These delays can make it more difficult for researchers to challenge the charges and also prevents them from making informed decisions during field season (e.g., lower invoice amounts than expected would allow them to extend their research activities). Some non-federal interview respondents mentioned that they would be personally responsible for paying these invoices, and not the organization with which they are affiliated (i.e., university or research organization).

The following table provides a summary (2016, 2017 and 2018) breakdown of the in-kind amounts provided by the Program to Program clients, and the recoverable amounts (by organization type). As indicated, federal government clients use fewer in-kind resources than the non-federal government clients, while the latter use fewer cost recoverable goods/services. In-kind support would include all services provided for which the users would not be paying, including Resolute accommodations, fuel and transportation.

Table 4: PCSP In-kind and recoverable amounts (Actuals, 2016-2018)

Organizations	In-Kind Support from PCSP (actuals)	Recoverable by PCSP (actuals)	Total Project Expenditures (actuals)	% in-Kind
Natural Resources Canada	$2,000,529	$5,067,575	$7,068,104	28.30%
Fisheries & Oceans	$1,242,158	$1,006,934	$2,249,092	55.23%
Environment Canada	$1,460,569	$2,524,287	$3,984,857	36.65%
OGD	$891,207	$2,474,050	$3,365,258	26.48%
Totals, Federal Organizations	$5,594,464	$11,072,846	$16,667,311	33.57%
Northern Organizations	$1,189,517	$2,605,310	$3,794,828	31.35%
Traditional Knowledge	$151,972	$0	$151,972	100.00%
Arctic-Antarctic Exchange Program	$261,215	$25,651	$286,866	91.06%
University	$7,387,953	$790,584	$8,178,537	90.33%
Foreign Science Organizations	$123,991	$1,488,338	$1,612,329	7.69%
Independent	$188,310	$453,250	$641,560	29.35%
Totals, non-federal organizations	$7,961,469	$2,757,823	$14,666,092	54.28%

Source: PCSP Financial system

As evidenced in the table above, the percentage of in-kind support in the total of project expenditures is higher for University Projects than for other organizations.  According to program representatives, these differences are based on the assumption that universities have limited resources and are more reliant on in-kind support than their government counterparts. There is also a program effort to support a maximum number of eligible University Projects.

In addition to maximizing the number of research projects supported, the effort to maximize the number of projects also provides for more opportunities for cost savings through coordinated logistics. It also provides for more opportunity to efficiently redistribute in-kind resources should the activities of any specific project change from original plans.  However, an approach that maximizes the number of University Projects also consumes additional administrative time and resources for the Program. 

These costs result from a variety of implications including the need for PCSP to conduct multiple rounds of planning prior to the work occurring, a higher likelihood of project changes that need to be addressed (e.g. cancelled or scaled back project plans), as well as the general requirement for more oversight at all steps from planning, establishing cost-sharing arrangements, execution, invoicing, et al.

Financial management controls and capabilities – Program wide

In addition to the evidence of timely reporting and updating financial forecasts (Arctic Logistics excepted), the assessment revealed evidence of practices and capabilities that support accuracy, compliance and VFM/efficiency of the Program’s financial resources while respecting operational priorities. These practices range from regular reconciliations to leveraging multi-year supply arrangements that provide the Program and Program participants’ access to air charter services. More recently, selected other services and goods have been added under terms and conditions that are more favourable and efficient than other procurement options. The Program also has a requirement in which multiple quotes are sought and assessed prior to making a procurement decision. It has also implemented upgraded processes to help ensure Inuit firms are offered priority as required under the Comprehensive Land Claims Agreement (CLCA). Finally, audit testing completed as part of the assessment indicated that the Program’s recovery of costs incurred on behalf of third parties (i.e. Program participants) reflected requirements under the RATS Act.

However, the assessment also revealed  some gaps and inconsistencies in terms of the Program’s ability to monitor and assess the application of  procurement requirements (e.g. requirement for three bids, or requirement to implement CLCA practices), as well as detect/prevent errors and delays in reporting final financial results at the Program participant project level. This includes considerable delays in providing invoices to Program participants as was reported in the 2013 Audit of the Polar Continental Shelf Program. Recommendations from the previous audit remained largely unresolved during the performance of this assessment, even though the Program regards them as obsolete.

Many of these issues and weaknesses are directly related to limitations in that key PCSP systems including the Arctic Logistics Database (the AL Dbase) and the Field Equipment Inventory System (FEIS) lack the capability to support effective financial reporting and management. Interviewees indicate widespread acknowledgement of limitations associated with these systems and that a combination of time and resource constraints as well as procurement delays have become longstanding in nature. As a result of these system limitations, the Office Management Unit (OMU), Field Equipment Unit (FEU) and other Program units have taken steps to create spreadsheets and implement other manual and ad hoc measures designed to bridge some of these gaps and limitations. These tend to be pragmatic in nature insofar as they meet a practical requirement (e.g. to track purchases, allocate costs, track spare parts or forecast equipment inventory demand).

Despite these efforts, the Program continues to lack the capability to demonstrate the effective and timely financial analysis that could provide timely insight around the achievement of objectives including financial efficiency. This includes, for example, reporting on the extent to which aircraft capacity was being utilized; noting that testing of 10 sample projects revealed average utilization of 20-30%. As another example, the walkthrough of the Sheffield warehouse highlighted a randomly selected satellite phone that was purchased in 2016 had been issued to a Program participant only once. Further, our testing conducted of project expenditures and equipment purchases revealed errors and inconsistencies that are often identified when the Program relies on manual systems and practices. Though the Program had demonstrated mitigating controls that would reasonably result in the correction of some of these errors (e.g. Program participants are provided with the opportunity to challenge cost allocations, periodic physical inventory counts, etc.), it remains that such practices result in additional administrative time. As well, it increases the risk that efficiency-related objectives will not be achieved and/or that relationships with Program participants will be compromised.

Cost sharing

While not “perfect” given the number of variables at play (including priorities, funding), the Program indicated that the cost sharing formula was appropriate to the extent that it assists delivering efficiencies by leveraging economies of scale. Further, the Program noted that the cost sharing formula currently provides universities with in-kind support that represents a significant portion of the total costs associated with individual projects. Without PCSP support, many of these projects would be unlikely to proceed. This is demonstrated in the Program’s projected support of university projects for the 2020 Field Season which indicate that in-kind support represents the vast majority of overall projected spending^{Footnote 6}. This assertion was also evident in our testing of projects insofar as the assessment team conducted a detailed examination of 10 projects including 6 that were university projects. For university projects, the average in-kind contribution from the Program represented 83% of the actual expenditures associated with the project.

Figure 3: 2020 Field Season: University Project Projected total In-Kind Support and Recoveries Allocated

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Figure 3 illustrates the university project projected total in-kind support and the recoveries allocated for the 2020 field season. The horizontal axis of the graph shows in-kind support in blue and recoveries in orange. The vertical illustrates the dollar amounts ranging from $20,000 to approximately $140,000.The blue lines depict in-kind support while the orange lines depict recoveries.

However, interviews with Program Management also revealed a common understanding that allocation of in-kind support favours those projects that are planned for regions where the Program is able to deliver more cost-effective logistics. For example, those projects that plan to leverage the Resolute hub are more likely to have in-kind support offered versus those in the Yukon or Western Arctic where the Program does not support sufficient volume to justify multi-year contracts that drive better VFM for researchers. This was supported by the assessment team’s project testing which indicated that only one (1) of the four (4) projects that occurred in the Yukon or Northwest Territories included at least one shared flight segment with another project. Whereas, all six (6) projects occurring in Nunavut had at least one flight segment that was shared with other projects.

Views from users

The assessment team assessed the extent to which users were satisfied with payment management and with the cost-recovery model. Most users (interviewees and 70% of survey respondents) were satisfied with PCSP’s payment management and said that processes were straightforward. A few said that PCSP invoices could contain mistakes, such as costs charged that do not match actual flights. Some users mentioned that PCSP sent invoices several months, in some cases years, after the travel had occurred. This becomes problematic when the invoice is significantly different than what was estimated. Some interviewees said that the late invoices are often lower than estimated, and that if they had known earlier, they would have conducted more research activities during that season. A few interviewees indicated that the timeliness in invoicing had improved in the last few years.

With respect to the cost-recovery model itself, the main concern mentioned during interviews with the users and stakeholders was about transparency. Many, including federal government users, said that there is a lack of clarity around how costs are managed and how invoices are calculated. A few users said that costs are deemed high for trips in the Yukon, where PCSP does not offer a competitive advantage for users.

Effectiveness and Efficiency of Business Model

The Program seeks to develop and apply formal business frameworks, processes and tools that would support the accurate, and verifiable, allocation of costs to supported projects. Like all federal programs, these cost allocations should reflect both good practices and the expectations of users including Program participants. For example, the Program would strive to ensure that costs allocated to supported projects would reflect the terms agreed to with Program participants and would be accurate both in terms of amounts and the ultimate ratio of in-kind versus reimbursable support. Finally, as identified in the 2013 Audit of the Polar Continental Shelf Program, the Program would work to ensure that reimbursable costs are invoiced and collected from Program participants in a reasonable and timely fashion.

Business model and framework

The assessment identified that the Program continues to implement a formal business framework that is supported by a number of SOPs and requires coordinated support, input and implementation from each unit within the Program. It also requires effective utilization of a number of tools including the AL DBase, FEIS and Financial Budgets/Forecasts. The overall business model is built upon a process in which applicants^{Footnote 7} (NRCan/OGDs, Canadian Universities and Northern Organizations such as Territorial Governments, Indigenous Governments and Northern Agencies, etc.) can apply to the Program for support. A vetting process which begins with a pre-screening and a logistics feasibility assessment that is led by the ALT is conducted.  For university projects that pass pre-screening and meet feasibility requirements, a Project Review Committee (PRC) is tasked with scoring each project against a Scoring Guide that is periodically updated by the Program. An individual university project’s score relative to other eligible university projects will drive the amount of support offered by the Program to that project. For federal government departments, the Program works through a “Coordinating DG” who acts as the representative for each department and who is responsible to allocate a lump sum of Program support to eligible projects.

To determine the amount of direct in-kind support that the Program has available for Program participants (e.g. Government Departments, Northern Organizations including Territorial Governments and to individual University Projects), the Program calculates an “allocation envelope” that includes estimates of available accommodation, aircraft charter capacity and fuel based on the Program’s budget allocation, forecast usage and existing fuel inventory. In addition to these amounts, the Program provides for an additional “top-up” amounting to 35% budgeted aircraft charter capacity. This top-up reflects the conservative nature of the Program’s budget development process insofar as it accounts for the high likelihood that some approved projects will either be cancelled or scaled back in any given field season. Once the allocation envelope is determined, the Program goes through a systematic process to allocate support to each category of applicant: OGDs (Other Government Departments), University Projects and Northern Organization, including Territorial Government, projects. The support is designed to target the model allocations as follows: 42% to OGDs (divided equally among NRCan, ECCC, DFO and any mix of other applicant departments such as Parks Canada Agency), 43% to University Projects and 15% for Northern Organization projects. The actual amounts allocated to OGDs, University Projects and Northern Organization projects, varies from these targets based on the number and nature of requests and accepted projects within each category of applicant. For example, if the total value of approved requests from Northern Organizations is less than the 15% allocated to such projects, the excess support is re-distributed to OGDs or University Projects.

Process for tracking and allocating costs to projects

Once initial allocations are completed, the Program enters into discussions that result in formal agreements with each Program participant. These agreements, and any subsequent amendments, form the basis for allocating and tracking costs associated with each research project until its completion. In addition to the population of approved project details inputted in the AL Database and the Field Equipment Inventory System (FEIS), the Office Management Unit (OMU) develops a Recoverables (by Season) spreadsheet, which is populated with costing details as per the agreements. Once actual costs are known, these are also entered into the spreadsheet for the purposes of determining the final amounts of in-kind and recoverable support provided to each project.

Interviews with program personnel revealed a consistently positive view of the Program’s business model and framework. As noted under the “cost sharing” section of this report, many interviewees, particularly those associated with university projects, are dependent on the Program’s support of their research projects in the north as there are limited options for the scientists to fund the expensive and complex logistical requirements associated with their work. However, interviewees also noted the considerable weaknesses and limitations associated with the lack of integration across key systems including the AL Database, FEIS and financial systems. Further, while testing of project cost allocations indicated that initial amounts reflect the agreements, there was also evidence of errors in the allocations that can lead to inefficiency, delays and/or inconsistencies with agreed terms. There continues to be a lengthy delay between a project’s completion and the Program’s issue of an invoice/statement of account to the Program participant (audit examination of a sample of projects indicated an average delay of over 86 days). This latter observation is consistent with findings reported in the 2013 Audit of the Polar Continental Shelf Program.

Comparisons and potential alternatives are provided below. No extensive financial information was available from the other programs reviewed as part of the case studies.

Appropriate and effective controls which are compliant with relevant legislative and policy requirements, are in place for financial planning, monitoring and reporting, including for the recovery of costs incurred on behalf of third parties.

The Program seeks to develop appropriate and effective controls, including guidance, procedures, tools, capabilities and other controls that would support financial planning, monitoring and reporting. This includes demonstrating an effective IM/IT infrastructure capable of supporting sufficient financial analysis and reporting to sustain defensible and timely decision making and related approvals. Further, PCSP strives to demonstrate a capability and capacity to promote and confirm accurate financial records and reporting as well as compliance with relevant financial policy or legislative requirements.

Financial management – Oversight & balancing priorities

Interviews and document review indicated that Program management had developed a number of good practices to support oversight and monitoring of PCSP’s financial position and forecast. These include budget development processes, which consider the expected volume of project activity including the extent of in-kind and recoverable expenditures, and routine monitoring of expenditures against approved budgets. Regular management meetings and Program Director bi-lats were used as forums to discuss relevant topics including financial planning, monitoring and reporting. For example, the Program’s Management Team has the opportunity to informally discuss requested purchases or other financial transactions prior to sign off on the expenditure by the financial authority. OMU takes an active role in expenditure management; for example, by working with Managers to ensure that financial authorities are respected and CLCA requirements are considered on applicable purchases.

However, there is some risk that financial oversight may be compromised due to weaknesses and gaps in the Program’s systems that limit the reliability and timeliness of financial information provided to management in support of their financial oversight responsibilities. For example, the lack of in-season reporting of actual AL expenditures incurred creates a scenario where logistics activities may be significantly higher or lower than expected which can have ripple effects on other purchases and related priorities. Moreover, one individual with the sole financial authority is responsible to review and consider a large number and range of transactions (e.g. contracts, inventory purchases and disposals, personnel travel, etc.). Not only can this be onerous, the authority must consider the implications of both in terms of operational (e.g. program participant safety and service) and financial (e.g. fiscal prudence, value-for-money, etc.) considerations. While there is a clear mandate, and often justified priority, for the Program to focus on operational considerations, there is less clarity regarding the mandate to ensure a level of financial management capable of supporting optimal efficiency while maintaining compliance. This appears to have contributed to an environment where operational priorities take precedence over investments in adequate systems and governance infrastructure. In the absence of a more formal financial management governance structure (e.g. an Office Management Unit [OMU], or other resource, with the mandate, authority and resources to prioritize and enforce financial management practices), the Program is at risk of failing to demonstrate effective financial controls , particularly around the efficiency of its operations.

IM/IT – Capability to support financial management

In addition to using departmental financial systems such as SAP, the Program has implemented a suite of custom applications and tools that contain financial information designed to focus on supporting operations. While they have proven to be effective in terms of serving PCSP’s operational priorities, they are neither integrated with financial systems nor capable of supporting the expected level of financial analysis and reporting. Among these systems are the following:

1. The AL Database which is an MS Access^© database hosted in Resolute that was first developed by a co-op student and which has since been updated and tailored to meet ALT’s requirements over a period of several years. This database contains critical operational information related to logistics, including project information and details such as number of participants, charter, fuel and equipment charges etc., all flight information, and details on location and nature of fuel caches that are scattered throughout the Arctic. While ALT personnel demonstrated a strong familiarity of how to use the database, all customization and remediation for this database are provided under a multi-year contract that is scheduled to expire in one year.
2. The Field Equipment Inventory System (FEIS) which is a FoxPro^© based application designed to support management of equipment inventory. Separate instances of FEIS exist in Resolute and at Sheffield Rd. Until the last few years, FEIS was also used for spare parts inventory (e.g. for facilities maintenance or garage). However, FEIS did not support development of work orders or management of scheduled maintenance, which led to the purchase of another system, CWorks CMMS^©. FEIS is scheduled for replacement by the end of 2020.

While these two systems are critical for supporting PCSP operations and contain potentially useful financial information, neither system is configured to support the financial planning, monitoring and related analysis needed to inform financial decision making. OMU works with ALT to find opportunities for the AL Database to be more useful in terms of financial management, but such adjustments tend not to be significant. As such, both the FEU and OMU have developed/a number of customized Excel-based tools over the years. These tools have been designed by the users to support the financial planning, monitoring and related analysis expected from the Program. Review of these tools and discussions with Program personnel indicate that they do not include clear instructions regarding their use, tend to involve a good degree of manual data entry and/or data manipulation, and require a considerable familiarity with the tool in order to use it. Another theme identified through the assessment was that these tools tend to focus on pragmatic financial requirements (e.g. reconciliations, budget development, expenditure tracking, project cost allocations, invoicing, etc.) with few examples of more sophisticated financial analysis or reporting such as trend/outlier and value-for-money analysis or compliance reporting. Further, the expenditure tracking tool is not informed by real time information on AL Activities which means that the Program’s actual expenditures are not captured and reported until several months after the completion of summer research projects. This creates a challenge regarding management’s ability to provide real-time oversight and direction regarding expenditures.

Despite long delays in procurement, the replacement of FEIS is underway with BETA testing expected to begin in summer 2021. However, there was little information available regarding the when, or if, the AL Database would be replaced. Management informed the assessment team that the expanded operational seasonality since the implementation of the Canadian Armed Forces Arctic Training Centre (CAFATC) means that the database is in-use for nearly the entire year. This makes it relatively more difficult to plan, develop, test and implement any customizations that would help support improved financial reporting capabilities.

IM/IT – Records management

As with any organization, PCSP relies on records management protocols and infrastructure to help support effective management of its inventory and other assets. This helps to ensure there is a suitable audit trail to support verification of the location, condition, and other detail of assets and related purchase. As well, it demonstrates the Program’s compliance with both internal and external requirements associated with these items. The testing conducted as part of this assessment, including testing of project costing and equipment purchases, required that the Program provide the assessment team with documents, copies of correspondence, and other records to support compliance with such requirements. As conduct of this testing occurred while various restrictions related to COVID-19 were in effect, the only records that could be provided by the Program were those that were available and accessible electronically by staff. In many cases, particularly regarding inventory purchase testing and purchases done via credit cards, the Program was unable to provide documentation to support the selected sample items. The assessment team selected additional purchase samples, and OMU representatives were able to retrieve some paper documentation from Sheffield Rd. However, of the 12 equipment-related purchases and 5 CLCA-related purchases selected, 4 and 3 purchases respectively could not be tested due to lack of available supporting documentation; with 4 other sample purchases only partially tested. The impact was considerably less significant on the project/charter testing; however, there were still a number of gaps in terms of the ability to provide digital copies of vendor invoices.

While the COVID-19 Pandemic was a significant contributor to this observation, there is an opportunity for the Program to digitalize records and further establish records management protocols^{Footnote 8} that, among other things, support remote working arrangements. Management informed that there are initiatives in place, including within OMU, to digitize records and support a management process that does not rely on paper records.

The Program has formal and effective processes in place to identify and mitigate risks, including Health & Safety and HR capacity including for rotational staffing in Resolute.

What we expected

It was expected that the Program, with support from the Department where applicable, would have developed further materials, practices, processes and protocols that would support timely awareness, identification and active management of its key risk exposures, particularly those risks that are somewhat unique when compared to other Government of Canada programs. Specifically, it was identified that the Program’s unique operational context gives rise to specific risk exposures related to Health & Safety, Management of Staffing Capacity and Conflict of Interest.

Health & Safety

As an operational program that provides logistical support, accommodations, equipment and other services, both Program personnel and Program participants are exposed to a wide range of H&S risks (aircraft transport, hazardous materials, food safety, etc.). See photo of working area within the Sheffield Road facility as an example of the exposures associated with Program Operations. Further, by delivering these services in Canada’s Arctic, these risks are amplified and expanded (e.g. extreme and unpredictable flight and landing conditions, extreme distances/cold/isolation, wildlife, etc.).

Interviews, document review and physical inspections conducted as part of the assessment indicated a high level of Health & Safety awareness by Program personnel. This is supported by the presence of H&S-related training, signage and equipment. Program personnel consistently identified H&S of employees, Program participants and contractors as PCSP’s top priority such that all key decisions, particularly those related to logistics (e.g. decisions to fly or ground aircraft, itineraries, cargo loads, etc.) were predicated on an assessment of H&S risks. The presence of active H&S committees which routinely conduct internal facility walkthroughs, inspections and drills both in Resolute and Sheffield was also notable.  SOPs covering a range of H&S topics were in place and mandatory training was provided to all staff as well as to all Program participants upon entering the Program’s facilities. While there was acknowledgment that H&S was historically left to Program personnel, it was also noted that Lands and Minerals Sector (LMS) had increased the H&S oversight/presence in the Program in the past year. Both Sheffield and Resolute facilities had been visited by a Sector H&S representative in 2019-20.

While there was good evidence of H&S awareness, practices and safety measures, there were also some indicators of potential weaknesses in the management of H&S-related risks. There were also some concerns regarding the capacity of the LMS sector to provide sufficient H&S expertise. While interviewees indicate that access to this expertise has improved, it was noted that there may be a capacity issue, with a ratio of one H&S Advisor for over 1200 employees located in approximatively 25 sites, including Resolute and Sheffield. Not only has this resulted in delays in providing the Program with formal reports on the result of on-site inspections, it may be a factor in why some longstanding H&S issues have not been addressed, including the leaking roof^{Footnote 9} at Sheffield (pictured) which has created an avoidable H&S risk for approximatively 3 years. Further, the SOPs related to H&S had not been reviewed/updated for some time, some as far back as 2013, which increases the likelihood that they may be out-of-date.

Management of staffing capacity

The Program’s seasonal operating cycle, particularly its requirement to staff the Resolute facility for 9-10 months of the year, creates an exposure both in terms of scheduling (i.e., optimizing the mix of full-time, part-time and contracted employees), but also in terms of recruiting and retaining employees available and willing to reside on-site in Resolute for weeks at a time while working 7-days a week/10 hours a day.

While the number of vacancies is not cause for concern, the assessment results indicated that efficiently managing HR capacity continues to be a challenge for PCSP, particularly recruiting and retaining personnel that are required to work in Resolute on a “6-week on/3-week off” rotation. However, there is evidence that this risk is widely acknowledged and actively managed so that serious implications are avoided. OMU helps to manage this risk by tracking the status of hiring activities and supporting each PCSP Manager in his/her hiring efforts. OMU also incorporates actual and planned staffing levels into the development of the annual Program budget.

Notwithstanding the evidence of effective risk management noted above, evidence of a formal risk identification assessment related to succession planning was not identified. The assessment identified some potentially significant HR-related risks related to succession planning. The Program is exposed to some risks in connection with certain key positions where the departure of the incumbent is likely to create some measure of disruption to the Program’s ability to maintain operations. This is particularly evident within the ALT, where the value and role of personal experience and expertise were identified as highly important to supporting effective and safe service delivery. Without a robust and formal succession plan for the ALT, the Program’s business continuity is at a higher risk. There were also similar, though less serious, concerns regarding succession planning within OMU that were related to the number, range and complexity of spreadsheets and other tools used to support financial management that were largely put in place by the same employee.

Conflict of Interest (CoI)

The significance of Conflict of Interest (CoI) risk is increased due to the volume of purchased goods and services relative to the overall size of the Program; driving a need to ensure that purchasing is not influenced by exposure to CoI. Specifically, CoI risk is relatively high for the Program given the limited number of suppliers for aircraft charters/related services and the specialized nature of equipment and other services purchased in support of Arctic research. Another factor is the CoI risk associated with project selection as the Program has authority to determine which applicants will have their projects supported by PCSP as well as the extent (e.g. in-kind support versus recoverable costs) and nature of such support.

The assessment team identified an opportunity to increase the Program’s awareness of CoI-related risk and the active management thereof. For example, while acknowledging the importance of avoiding CoI, interviews with program personnel also revealed an acknowledged lack of Program-specific internal requirements^{Footnote 10}/ SOPs, reporting and analysis to support identification of potential CoI. Notwithstanding, interviewees also pointed to existing controls to promote fairness and transparency (e.g. requirement for 3-quotes on purchases, centralized purchasing provided by OMU, an independent PRC project selection process,  and Director-level sign-off on all financial transactions).

Given the lack of a formal process in place to identify potential conflict of interest risks (e.g. analysis of purchasing to identify unusual trends^{Footnote 11}, particularly high use vendors, formal identification and assessment of CoI-related risks, etc.), the Program may not be able to identify and appropriately investigate/mitigate such risks should they manifest. The stakeholders did not mention any difficulties with respect to the project selection process, apart from the lack of representation of some groups in the committees (including northerners). It is worth noting that no CoI issues were identified as part of this assessment.

The Program has formal and effective processes for the management of inventory and other assets, including IT assets, equipment and resources, in compliance with relevant legislative and policy requirements.

The Program seeks to develop and implement formal requirements, procedures, practices and tools to support the effective management of assets. This includes demonstrating a continuous capability to provide suitable field equipment to Program participants and to maintain an infrastructure of major capital (i.e. buildings) and IT assets that is appropriate to the Program’s needs and priorities and also reflects consideration of cost effectiveness and compliance. It also includes maintaining inventory records that are both accurate and suitable to support analysis such as the identification of slow moving or expired items. Finally, PCSP strives to ensure that transportation of inventory and other assets to Resolute reflects cost effective options and that purchases of goods and services for consumption in Nunavut comply with the CLCA.

Compliance with financial authorities

Testing of equipment purchases completed by the assessment team indicated that the Program was generally able to demonstrate compliance with Financial Administration Act (FAA) requirements (including Section 32 and Section 34) as well as the Department’s delegated financial authorities. From the sample of 12 purchases, there were three (3) purchases where the Program was unable to demonstrate FAA compliance as this evidence was only available in paper form and was not accessible due to COVID-19 restrictions. For the remaining nine (9) purchases, evidence of compliance was provided with the exception of one (1) purchase where testing revealed that goods were purchased prior to receiving formal S.32 authorization.

Inventory management

Interviews, document review, testing and walkthroughs conducted by the assessment team revealed ongoing weaknesses and gaps in the capabilities of PCSP’s equipment inventory system (known as FEIS). Key weaknesses of FEIS are that separate instances of it are required for Sheffield Rd and Resolute and are not integrated. As well, there is reliance on data downloads to populate manual Excel-based tools and reporting required to support effective management of equipment inventory. The assessment also highlighted a known weakness in FEIS in that equipment that is indicated as “on hand” may not actually be available to clients in the event the item is actually in for inspection, repairs, cleaning or has been removed from shelves in anticipation of disposal. These weaknesses and gaps have caused the Program to take a relatively conservative approach to inventory management. As a result, quantities of equipment are often maintained at higher levels than expected demand due to uncertainties around actual quantities available to meet operational requirements. The FEU also conducts physical counts of equipment inventory each year following the field season as a way to help ensure the accuracy of inventory records.

The Audit and Evaluation Branch’s efforts to follow-up on the 2013 Audit of the Polar Continental Shelf Program indicated that efforts to procure a replacement for FEIS had been underway for over two years prior to the 2019 procurement of a new Commercial off the Shelf (COTS) inventory management solution. This new system is currently being configured by the supplier. As well, NRCan’s Chief Information Officer and Security Branch has engaged a business analyst to assist with implementation of the new system. The Program currently estimates that the new COTS solution will be implemented by the third quarter (Q3) of 2021-22; a date which has been moved back from estimates provided in 2019.

As noted, FEU completes periodic inventory counts at both Sheffield and Resolute in order that inventory records are adjusted as appropriate to reflect physical quantities on-hand. Discussions revealed that OMU is not involved in these counts nor in the reconciliation of various inventory records. Test counts at both Sheffield and Resolute revealed that FEU staff were very knowledgeable regarding equipment inventory (e.g. location on shelves, usage trends, recent movements, etc.) and that the warehouses were generally well-organized and maintained. The counts also revealed some discrepancies between physical inventory and inventory records (FEIS system) at both locations; however, most of the unexplained discrepancies were relatively minor (i.e., many discrepancies were for 1 item). The counts confirmed some weaknesses in FEIS such as discrepancies related to lack of integration between Sheffield and Resolute as well as identification of equipment items that were not available for use. They had been flagged as “on reserve” for clients or were removed from the shelves for inspection or cleaning. In one instance, 14 snowmobile helmets that were recorded as “available” in FEIS were not physically present in the Sheffield warehouse. While investigation of this discrepancy led to a February 2020 adjustment voucher that identified the helmets as lost, follow-up discussion with the FEU Manager revealed that the voucher had not been posted as of our test count on June 17, 2020. Furthermore, the helmets had actually expired rather than being lost.

Capital maintenance

Physical inspections of both Sheffield and Resolute facilities indicated that Program personnel appear diligent in ensuring that Program assets were effectively and safely organized. There were clearly defined spaces for shipping and receipt as well as appropriate storage and labelling of hazardous materials such as fuel and firearms. There were some examples of assets not belonging to the Program that were being stored within Program facilities (e.g. NRCan vehicles, researcher’s equipment and spare parts belonging to a helicopter charter company); however, these were identified as exceptions.

There were no identified examples of significant maintenance concerns, with the exception of the leaking roof at Sheffield. Heavy equipment, such as loaders and vehicles appear to be in good working condition with care taken so that regular scheduled maintenance is provided (See photo of heavy equipment maintenance schedule in Resolute). In terms of common themes regarding management of larger physical assets, the interviews and observations identified challenges related to the remote location of Resolute. Extreme cold can significantly limit the useful life of assets or impact their ability to function properly (such as the garbage incinerator at Resolute) and considerable cost and time lag are associated with transporting such items to the far north. Interviewees noted that through years of experience the Program had become accustomed to managing these challenges. For example, the Resolute facility features a number of redundant systems (e.g. power generation, heating, water/sewer) that can be called upon in the event of a failure, the impact of which would be more important in Resolute than an equivalent occurrence in the South.

The PCSP has formal and effective mechanisms in place for all gender, equity and GBA+ considerations for clients and stakeholders.

To ensure that PCSP meets federal government priorities and responsibilities with respect to gender equality and diversity, it was anticipated that the Program would provide and promote equal access to all user groups to the Program and to the Program’s outcomes, both intended and unintended. Where differences exist, it was anticipated that the Program would identify and address potential barriers to equality and diversity. For instance, given the underrepresentation of women in Science, Technology Engineering, and Math (STEM), it was anticipated that the Program would apply a gender lens so as not to disadvantage female applicants. To ensure equality and diversity, it was also expected that the Program would collect demographic information about applicants, research leads, and research program participants. It was also expected that program equipment, the Resolute facility, and safety measures in the field would be appropriate to all user groups. Finally, in line with GBA+ principles, it was anticipated that PCSP would consider and act according to the principles of Reconciliation by conducting its activities in a manner respectful of and beneficial to First Nations and Inuit people.

Results of Analyses

The GBA+ analyses examined overall access to the Program by different populations, and suitability of PCSP components to all user groups, including the provision of equipment and the Resolute facility. Interviewees and survey respondents generally agreed that the Resolute facility is suitable for all gender groups, especially since the facility was renovated a few years ago (there were no response differences between gender groups). The location now offers single accommodation, separate accommodations for males and females, and gendered bathrooms. Those elements were described as improvements. Survey and interview evidence also indicates that most female users are satisfied with PCSP equipment (in proportions similar to male users).

The program does not collect any demographic information from lead researchers or research participants, except gender information for funded team members going in the field. This gender information is provided by project leads, not through self-identification by team members. Gender analysis for PCSP has been conducted over the years using the Principal Investigators’ name as proxy for gender. According to interviewees, adding demographic questions to the application process has been delayed due to challenges in refreshing the Program’s IT infrastructure.

According to literature, women continue to be in the minority in Science, Technology, Engineering, and Math (STEM) fields. In 2016, women made up 34% of STEM bachelor’s degree holders and 23% of science and technology workers among Canadians aged 25 to 64^{Footnote 12}. PCSP data shows that 23% of supported Principal Investigators of research teams are female (varying between 18% and 36% during the period). PCSP has implemented no measures to particularly support female researchers. The application review process does not consider gender, and research has shown that that the criteria related to academic publications can disadvantage women, who publish less than men on average. It is also interesting to note that among assessment survey respondents, females were less likely than males to be satisfied with the ease of filling out the application forms (63% female were satisfied, versus 72% for male). On a positive note, many of the students and researchers accompanying Principal Investigators are female. About 90% of the survey respondents said that their project involved female students, and 55% of all students involved in projects were female.

Finally, as mentioned in other sections of this report, a number of interviewees said that the Program should involve more northerners at the project level and the staffing level. However, program documentation (GBA+ analyses) reports that service suppliers in the north employ predominantly male workers, which indirectly contributes to an unequal distribution of program benefits. Sufficient data on Indigenous employment for quantitative analysis was not available, due to gaps in PCSP’s performance measurement indicators. As well, research teams may employ community members directly, rather than through the Program.

Are there alternative program designs that could improve the effectiveness and efficiency of the Program

Other Designs

The case study component of the assessment revealed alternate models in Canada and abroad. In Canada, three cases of similar programs were covered: the Centre for Northern Studies (CEN) (associated with Université Laval), the Western Arctic Research Center (WARC)/Aurora Research Institute and the Arctic Institute of North America (AINA) (associated with the University of Calgary). All of these organizations provide advisory services and are true research organizations. The CEN provides a similar service to PCSP, but at a smaller scope in a specific region (Northern Quebec and Nunavut), and at higher expense for users than the PCSP as it is based on a cost-recovery model. The WARC is also based on a cost-recovery model and focusses on the NWT and Yukon. As for AINA, unlike other research centres focusing on the Arctic/Northern Canada, it does not provide much logistics support since most of the fieldwork is done where there is road access. It can provide equipment at a rental fee, and accommodation in the Kluane Lake Research Station (Yukon) is provided on a user-fee basis. It should be mentioned that all of these organizations collaborate with PCSP to coordinate transportation of goods and researchers.

Two of the cases studies focussed on foreign programs. The first, the Alfred Wegener Institute (AWI), is located in Germany. While Canada has many organizations involved in polar research, AWI is the national coordinator of German polar research activities. The AWI serves two clienteles. When a research proposal is accepted, it gives access to research and logistics support for free including transportation, accommodation, equipment, etc. Other users can access services on a user fee basis. The AWI has a 5-year plan to which research proposals must be aligned. AWI also manages two vessels and two aircrafts for Arctic research (the vessels are owned by the German federal research fleet). AWI also provides logistical advisory services for researchers.

The other organization reviewed is the British Antarctic Survey (BAS) (United Kingdom). BAS is a research organization that manages multiple research stations in the Arctic and Antarctic and operates two ships and five aircraft. When approved, research projects from the UK are funded by BAS at a rate of 50% of the costs. Foreign researchers using BAS need to pay users fees (costs are recoverable). BAS managed to reduce some of its costs through transportation assistance provided by the UK military.

Partnerships and coordination

Case study evidence shows that there are opportunities for PCSP to engage/strengthen partnerships with federal departments and agencies such as Indigenous Services Canada, Transport Canada and the Canadian Coast Guard (CCG). These organizations can potentially offer transportation services of interest to PCSP and its users and/or better promote PCSP within their organization. Interviewees noted that PCSP is not necessarily well-known in these organizations.

In particular, the CCG is currently expanding its presence in the north and recently created a new administrative region for DFO (Arctic Region). CCG is equipped for the transportation of goods with barges, tugboats, and helicopters that can move 1,400 pounds of material. New icebreakers will soon be built, including the John G. Diefenbaker that will replace the Louis St-Laurent in remote areas. The new icebreaker is designed to be able to operate year-round, and will include laboratory space, a helideck and hangar for two medium-lift helicopters. As DFO becomes more present in the north (due to the extending navigable areas as a result of global warming), there is an opportunity to collaborate in order to transport materials and people, including those conducting research in shoreline areas.

It was mentioned that PCSP and CCG had a Memorandum of Understanding (MOU) between the two organizations in the past. CCG provided a cargo service for PCSP equipment going to Eureka. It was decided to leave this service to commercial transportation companies given that these companies were deemed better equipped than CCG for the transportation of fragile merchandise. However, interviewees see a potential for a renewed collaboration with new opportunities resulting from changes at DFO.

Governance and administration of program

Some interviewees mentioned that PCSP had an advisory committee that comprised members from other organizations. The committee was disbanded in 2016 as a result of an organizational review. However, interviewees mentioned that the committee allowed NRCan to connect with other key players, including other federal agencies that fund northern research. The committee also allowed NRCan to better understand community needs. With the development – and greater use – of new online videoconferencing interfaces, it would be possible for NRCan to recreate a new committee at very low cost. The committee could be consulted about partnerships, delivery options and selection criteria.

Delivery

From a delivery perspective, a number of suggestions were made by users, ranging from increasing the Program size and budget to expanding the western presence of the Program. A contingency fund to help absorb higher than expected costs for users was also suggested. A pre-approval of multi-year projects would, in the view of these interviewees, make it easier to plan, both for them and PCSP.

Is NRCan best suited to manage PCSP?

Interviewees were asked if PCSP should continue to be located within NRCan. Most interviewees, particularly users of the Program, agreed that PCSP should continue to be based at NRCan although many said that it could (theoretically) be housed in another federal department. A few said that Polar Knowledge Canada had not yet reached its full potential to assume these responsibilities to the same extent as PCSP. Some interviewees said that PCSP could have an agency status, such as an Operational Agency Status, in order to access more flexibility in its administration.

Implications for the Program in the Context of Devolution and Land Claims

What are the implications for the Program in the context of devolution and land claims?

An internal assessment of modern treaty implications was conducted by NRCan in the context of the most recent PCSP application for renewed funding. The assessment of the funding proposal found that the Program has implications for modern treaties and/or the Government of Canada’s compliance with its legal obligations contained in modern treaties. Potential implications were identified for the following modern treaties: Nunavut Land Claims Agreement, Inuvialuit Final Agreement, Gwich’in Comprehensive Land Claim Agreement, Sahtu Dene and Metis Comprehensive Land Claim Agreement, Tlicho Agreement, Nunavik Inuit Land Claim Agreement and Yukon Agreements and their provisions relating to Comprehensive Land Claims and Self-Government agreements. The document however notes that PCSP has (already) implemented internal processes that incorporate modern treaty implications into its operations, and renewed funding will follow the existing program’s protocols to ensure ongoing compliance. According to the document, program procedures and protocols respect Modern Treaties.

The Program is bound by the purchasing requirements set out in CLCA in which Inuit firms are to be given priority when procuring goods or services that will be consumed in Nunavut. Document review indicated that the Program had developed an SOP specific to purchases subject to CLCA. While interviews indicated that the Program was understood to be responsible for 3% of the 5% of the Department’s targeted Indigenous purchases (including those subject to land claim agreements), interviews also indicted that PCSP had been challenged to effectively promote the participation of qualified Inuit firms on solicitations. To address this challenge, the Program made some changes to process beginning in January 2020 that included proactive engagement with qualified suppliers listed in the Inuit Firm Registry Database as maintained by Nunavut Tunngavik Incorporated (NTI). There was agreement among Program personnel that this active engagement was a positive step that was already serving to increase the level of Inuit supplier participation. Evidence that the Program had conducted a formal risk identification and assessment exercise specific to CLCA was not identified.

To confirm compliance with CLCA, the assessment team selected a sample of 5 purchases from categories that were most often associated with CLCA (e.g. aircraft support, janitorial products, food, security, etc.). For 3 of these purchases, the Program was unable to provide supporting documentation to demonstrate compliance with the CLCA process as a result of COVID-19 related restrictions. Only one (1) of the samples fully demonstrated compliance with CLCA processes, while another demonstrated partial compliance. For the other three (3) purchases, the Program was unable to access supporting documentation due to COVID restrictions.

PCSP operates a facility (Resolute) on lands leased from the Government of Nunavut and deploys staff in settlement lands under the jurisdiction of modern treaties. There is ongoing engagement with the Hamlet of Resolute, but the duty to consult had not been triggered, according to documentation. Documentation also states that all applicable PCSP procurement processes for services or goods are compliant with federal government requirements with respect to the CLCA in effect. The documentation further notes that PCSP annually contributes approximately $5M towards contracts with northern and/or Indigenous suppliers. PCSP is currently responsible for meeting 3% of NRCan’s 5% target for procurement to Indigenous suppliers^{Footnote 13}.

Perspectives from stakeholders

Several interviewees could not comment on these issues. Generally, they described that, progressively, the research community is putting greater emphasis on engaging communities, valuing and integrating traditional knowledge, supporting northern-based research, and addressing northerners’ priorities. Most interviewees across categories, however, recommended that the Program engage in stronger collaboration and partnership with communities and actors in the north. Interviewees encouraged PCSP to train and hire locally (as opposed to having staff come from the south), to establish internship programs for northern youth, and to better support research spearheaded by (or at least aligned with the interests of) northern communities and researchers. A few interviewees stated that the Advisory Board used to provide PCSP with a good connection to northern affairs and realities (however that body never included community representation). Concerning devolution, some interviewees noted that support from the federal government for northern research logistics remains necessary, because territories and northern communities cannot support this on their own. However, they stated that there were opportunities for PCSP to further partner/coordinate with the different levels of northern governance, as well as with northern communities, researchers and businesses/providers directly.

Conclusions and Recommendations

There is strong evidence that there is an ongoing need for the Program, that users are satisfied with the logistical assistance provided by the Program, and that the Program provides a significant contribution to scientific research in a variety of disciplines in the north. There is also evidence that the Program is ensuring safety for its users, and that they benefit from a low-cost logistical and transportation service and quality equipment through PCSP. According to program financial data and estimates based on survey data, savings for users are estimated to be within a range of $16M to and $20M during the 2014-2019 period.

Many quality, longitudinal research projects have been made possible as a result of the Program. In this sense, PCSP is much more than a logistical assistance center; it plays a true program role by contributing to a net impact on the production of northern science and knowledge. Despite these successes, there is an opportunity to further promote the Program. More applications would allow the Program to increase the incremental impact of the Program, promote female participation in Principal Investigator roles, and create efficiencies by making better use of chartered flights.

The Program also has extensive unintended impacts. It provides a unique training opportunity for new/young researchers, and it contributes to economic impact in the north, especially to the transportation and accommodation sectors. It creates learning opportunities for youth in the north. PCSP also provides employment opportunities, but there is a general agreement that more can be done to increase the employment impact. There is also a general agreement that PCSP can further develop its partnerships with other federal departments and agencies to increase efficiencies.

Although the Program has deployed significant efforts to meet the scientific and safety needs of its users, ongoing challenges with respect to its governance structure, financial systems, data systems and controls have prevented PCSP from maximizing the use of its resources. The assessment found that the Program’s business model was supported by a number of systems, guidelines, practices, and other controls that help to support both the efficient use of resources and compliance with legislative and policy requirements. However, operational priorities and procurement delays have contributed to longstanding gaps and weaknesses in key systems that continue to limit the Program’s ability to deliver a level of financial management capacity commensurate with its size and importance. The impact of this includes the Program having only limited insight regarding its financial efficiency, limited financial analysis and reporting in support of decision making and financial records that are prone to errors and/or delays due to reliance on manual practices. Further, there is some evidence that the Program may be exposed to higher than expected risks related to business continuity and achievement of value-for-money through purchasing activities.

The assessment also concludes that the Program can play a role in promoting gender equity in northern science, but that the Program has not given itself the tools to do so. This includes the use of selection criteria to support applications led by women.

While there is evidence that many researchers have long-term research agendas in the north, there was no evidence that the Program has long-term planning activities. The assessment also found that the Program does not assess federal government research needs in a formal manner. As well, that there is no committee structure or other formal mechanism that would allow it to understand user needs and adapt its activity schedule accordingly.

Finally, the assessment found that the Program has a role to play in the Government of Canada’s compliance with its legal obligations contained in modern treaties. Potential implications were identified for the following modern treaties: Nunavut Land Claims Agreement, Inuvialuit Final Agreement, Gwich’in Comprehensive Land Claim Agreement, Sahtu Dene and Metis Comprehensive Land Claim Agreement, Tlicho Agreement, Nunavik Inuit Land Claim Agreement and Yukon Agreements and their provisions relating to Comprehensive Land Claims and Self-Government agreements.  According to evidence, PCSP implemented internal processes which incorporate modern treaty implications into its operations. Renewed funding will follow the existing program’s protocols to ensure ongoing compliance. The Program is bound by the purchasing requirements set out in the CLCA whereby Inuit firms are to be given priority when procuring goods or services that will be consumed in Nunavut.

As noted earlier, PCSP operates a facility (Resolute) on lands leased from the Government of Nunavut, and deploys staff in settlement land under the jurisdiction of modern treaties. There is ongoing engagement with the Hamlet of Resolute, but according to documentation the duty to consult had not been triggered. Most interviewees across categories recommended that the Program engage in stronger collaboration and partnership with communities and actors in the north. It was generally agreed that there is an opportunity for PCSP to train and hire locally (as opposed to having staff come from the south), establish internship programs for northern youth, and to better support research spearheaded by (or at least aligned with the interests of) northern communities and researchers.

Recommendations

To address efficiency issues, the assessment proposes the following recommendations:

Recommendation #1. To improve efficiencies, it is recommended that:

1. Improvements be made to the Program’s governance and oversight structure as it pertains to financial planning and performance including such items as longer term financial/cash flow planning, activity planning, compliance, and efficiency in support of reliable and timely information for decision making;

Management Response

Management agrees.

A review of the program’s governance and oversight structure to improve efficiencies will be conducted, including tools and procedures related to financial planning, delegation and oversight, performance, activity planning and compliance, to ensure timely and reliable information for decision-making.

Actions include:

• An internal review of governance and organizational structure, financial delegation and oversight tools and procedures, activity planning and compliance, financial planning and performance;
• Results of the review will inform development of an implementation plan with milestones to address the review; and
• Roles and responsibilities to implement a record keeping system for compliance documentation (i.e. CLCA tracking, vendor lists for conflict of interest analysis) and data analysis will be identified.

Position responsible: ADM LMS

Due Date: Review completed by May 31, 2022. Implementation plan developed by September 30, 2022.

2. As a component of the governance structure, develop a terms of reference for a committee structure, that includes reporting guidelines, with representation from other government departments and funding agencies to ensure stakeholder considerations are taken into account within decision-making;

Management agrees.

PCSP agrees to create a committee structure to ensure stakeholder considerations are taken into account for decision-making. This committee will include representation from other government departments and funding agencies. An environmental scan with representatives from key government departments and funding agencies to inform development of the committee structure and terms of reference will be conducted.

Position responsible: ADM LMS

Due Date: Decision on committee structure and terms of reference completed by April 30, 2022.

3. PCSP implement strategies with federal departments and northern organizations to leverage resources, increase employment and meet current and emerging needs of its users.

Management Agrees.

PCSP will identify and implement strategies with federal departments and northern organizations to leverage resources, increase employment and meet current and emerging needs of its users.

Actions include:

• A review of current strategies with federal departments and northern organizations to identify gaps and opportunities to leverage resources;
• Development of an implementation plan with federal departments and northern organizations to increase employment and meet emerging needs of its users; and
• Implementing a monitoring system to track new initiatives aimed at increased employment and/or meeting emerging needs in the north.

Position responsible: ADM LMS

Due Date: Tracking system implemented by Sept 30, 2021.

Recommendation #2. For each of the Program’s internally developed tools and reports (e.g. Excel spreadsheets, databases and other tools):

1. Formally document their purpose, key users, accountability for the tool/report, source(s) of information and how/if they link with other systems including Departmental systems; and
2. Identify and document instructions and training materials on the use and maintenance of these tools to support consistency, quality control, and continuity and inform requirements in recommendation #1.

Management Agrees.

PCSP will document its internally developed tools and reports including key users, accountability, sources of information and how/if they link to departmental systems.  Instructions and training materials on the use and maintenance of these tools aimed at supporting consistency, quality control, and continuity will also be documented.

Actions include:

• Identify and appraise each of the Program’s internally developed tools;
• Document the purpose and objectives of each tool and how they link with Departmental systems;
• Document instructions and training materials that support consistency, quality control and continuity for each tool; and
• Develop system guidelines for effective knowledge transfer including standard operating procedures or manuals.

Position responsible: ADM LMS

Due Date 2a): Identify the purpose of the Program’s internally developed tools and how they link with other systems by Oct 31, 2021.

Due Date 2b): Document instructions and training materials for each tool by April 30, 2023.

Recommendation #3. Improve or replace the Program’s proprietary logistics and financial systems/tools with commercial solutions that better support integrated and reliable financial reporting, cash management, invoice management and related financial analysis.

Management agrees.

PCSP will replace its Field Equipment Inventory System and improve additional logistics tools following a review of commercial solutions to better support integrated and reliable financial management, including improvement of invoice and cash management and financial analysis. 

Actions include:

• Identify improvements to financial and logistics systems/tools to better support integrated reporting, invoice and cash management and related financial analysis;
• A review of commercial IM/IT systems to enable incorporation of financial reports into logistics systems;
• Develop scope of work and requirement documents for logistic systems replacement and/or modifications; and
• Procure or engage private sector services in order to implement modifications or improvements to databases and financial systems.

Position responsible: ADM LMS

Due Dates: Develop work plan for improvements to logistics tools by Dec 31, 2021.

Replacement of the Field Equipment Inventory System by April 30, 2022.

Implement improvements to logistics systems/tools by April 20, 2023.

Recommendation #4. Undertake a risk identification and assessment that will support a risk profile for the Program. This would include a focus on those risks that may be particularly relevant/unique to PCSP’s environment and objectives e.g. health and safety, compliance (including CLCA), succession planning, conflict of interest, etc.

Management agrees.

PCSP will conduct a risk identification assessment that will support a risk profile for the Program. This assessment will focus on risks relevant to PCSP and include health and safety, compliance, succession planning, and conflict of interest.

Actions include:

• Engagement with Lands and Minierals Sector’s Business Management Services and Data Branch and Corporate Management and Services Sector (CMSS) on development of a risk profile for the program that includes NRCan financial, health and safety, environmental and conflict of interest guidelines.
• Updating the program’s performance information profile and relevant corporate reports.
• Development of job-specific training plans, standard operating procedures and a framework for tracking of certifications to address occupational health and safety risks.

Position responsible: ADM LMS

Due Date: Risk assessment completed by December 31, 2021.

Recommendation #5. To improve efficiencies, the quality of the projects and promote gender equity and cultural inclusivity, it is recommended that the Program upgrade its systems and processes, including project selection systems and processes, to promote and monitor diversity of its clients.

Management agrees.

PCSP will improve efficiencies, the quality of projects and promote gender equity and cultural inclusivity by:

• modernizing its project intake form to make it easier for clients to apply to the Program;
• implementing a monitoring system to track applicant gender equality and diversity; and
• reviewing its selection processes to identify areas to promote gender equity and cultural inclusivity.

Position responsible: ADM LMS

Due date: New equity, diversity and inclusion criteria incorporated into project selection process by Sept 30, 2021.

Recommendation #6. In order to facilitate planning from a resource management perspective (including NRCan and other federal partners) and users’ perspective, it is recommended that PCSP pilot a multi-year planning approach.

Management agrees.

PCSP will pilot a multi-year planning approach to better manage resources and client support. This will include development of a framework and piloting multi-year planning options for procurement, facility maintenance and logistical requests of clients.

Position responsible: ADM LMS

Due date: Implement multi-year planning pilot by May 30, 2022.

Appendix A: Logic Model

Text version

This is a graphic of the PCSP Logic Model for the Polar Continental Shelf Program. The first row contains the Core Responsibilities, Ultimate Outcomes, Intermediate Outcomes, Outputs and Activities. The second row describes each as follows: Resource Science and Risk Mitigation NRCan Responsibility is below Core Responsibilities; Canadians have

information and knowledge about Canada and its Arctic Outcome is the Ultimate Outcome; Research advances scientific knowledge of the Canadian landmass and contributes to the exercise of sovereignty particularly in the Arctic is the Intermediate Outcome; Scientists receive the safe and cost effective field logistics support and related assistance they need to conduct research is the Immediate Outcome; Project arrangements for

logistics support across Canada and in the Arctic is the output; and Coordinating and Delivering field logistics support across Canadian landmass with a focus on the Arctic corresponds to the activities. In the Logic Model the activities flow to Outputs then Immediate Outcomes, then Intermediate Outcomes then Ultimate Outcomes.

The bottom right corner describes the Field Logistics

• Provided by PCSP that include: Inventory of field equipment and field vehicles for use across Canada
• Charter air transportation to and from remote field camps across Canadian Arctic
• Fuel for aircraft, equipment and camps across Canadian Arctic
• Meals, accommodations and working space (including multi-purpose laboratory facility) at the PCSP facility in Resolute

Appendix B: Engagement Sub-Objectives and Criteria

The objectives of this engagement are to assess the relevance and performance of the Polar Continental Shelf Program, and the adequacy of the management control framework for the effective and efficient use of Program resources.

The following table identifies the questions addressed by the engagement, as well as the sub-objectives and criteria used to conduct the engagement:

Engagement Sub-objectives and Criteria

Sub-Objectives	Criteria
Sub-Objective 1: To assess the extent to which the PCSP is relevant to the GoC, NRCan, and Program Stakeholders	1.1 The PCSP is aligned with Government of Canada and NRCan roles and priorities.
	1.2 The program is designed to be effective and reduce overlap with other programs, and is reviewed on a regular basis.
Sub-Objective 2: To assess the extent to which the PCSP has achieved its expected outcomes (as per the logic model in Appendix A), and identify any unexpected outcomes	2.1 Scientists receive safe and cost-effective field logistics support and the related assistance they need to conduct research, and this is more than they would receive in the absence of the program.
	2.2 The PCSP advances scientific knowledge of the Canadian landmass, and contributes to the exercise of sovereignty, particularly in the Arctic.
	2.3 Canadians have information and knowledge about Canada and its Arctic.
	2.4 Potential or actual unintended outcomes are understood by the program and mitigation strategies are implemented as required.
Sub-Objective 3: To assess the extent to which the PCSP’s design, delivery, and performance are adequate for the effective and efficient use of resources, including the following areas: PCSP business model; PCSP management control frameworks; resource planning; PCSP management and strategy for logistics support	3.1 The program facilitates efficient use of time and resources for program participants, using a cost-sharing formula that is appropriate from both the program’s (financial) and users’ perspectives, with gaps between expenditures and budgets documented.
	3.2 Business models, frameworks and/or processes are effective, efficient and comparable to other organizations with respect to how much users are paying, and how much they could be paying.
	3.3 Appropriate and effective controls which are compliant with relevant legislative and policy requirements, are in place for financial planning, monitoring and reporting, including for the recovery of costs incurred on behalf of third parties.
	3.4 The Program has formal and effective processes in place to identify and mitigate risks, including Health & Safety and HR capacity including for rotational staffing in Resolute.
	3.5 The Program has formal and effective processes for the management of inventory and other assets, including IT assets, equipment and resources, in compliance with relevant legislative and policy requirements.
	3.6 The PCSP has formal and effective mechanisms in place for all gender, equity and GBA+ considerations for clients and stakeholders.
	3.7 The Program is aware of alternative design and delivery options and operates according to a model that optimally balances effectiveness and efficiency for the Program, NRCan, the Government of Canada, and PCSP clients and stakeholders.
Sub-Objective 4: To assess the extent to which PCSP key governance mechanisms are adequate and effective	4.1 Selection criteria that reflect PCSP objectives and priorities are in place for proposals’ evaluation, and controls are in place to identify and mitigate actual or perceived conflicts of interest related to selection.
	4.2 The Program has formal and effective risk-based processes to support timely and risk-based decision making and oversight.
	4.3 The PCSP resource planning and management strategy for logistics support positions it to support emerging issues associated with devolution and land claims policies and activities in Canada’s North, and PCSP has the ability and capacity to plan for changes in demand for services.
	4.4 The PCSP’s resource planning and management strategy for logistics support positions it to support emerging scientific and logistics activities in Canada’s North, and PCSP has the ability and capacity to plan for changes in demand for services.

Appendix C: Bibliography

1. Government of Canada. (2017, April 10). Investing in Canada’s Future: Strengthening the Foundations of Canadian Research (Canada’s Fundamental Science Review 2017), Ottawa (ON). PDF – 2.5 MB
2. The Council of Canadian Academies. (2019). Canada’s Top Climate Change Risks (The Expert Panel on Climate Change Risks and Adaptation Potential), Ottawa (ON). PDF -  5.48 MB
3. Government of Canada. (2019). Annual Report of the Chief Science Advisor 2018, Ottawa (ON). PDF – 4.6 MB
4. Transportation Safety Board of Canada. (2019, November). Air Transportation Safety Issue Investigation Report A15H0001, Ottawa (ON). 
5. Government of Canada (2018). Federal Arctic And Northern Science And Indigenous Knowledge Approach (draft), Ottawa (ON). (Accessible only on the Government of Canada network).
6. Inuit Tapiriit Kanatami. (2018). National Inuit Strategy on Research, Ottawa (ON).
7. Leroux, J.G.R., Major. (2017). The Arctic SAR Region: Frozen in Time, (Canadian Forces College, JCSP 43, 2016-2017, Exercise Solo Flight), North York (ON).
8. Mallory, M. et al. (2018, May 30). Financial Costs of Conducting Science in the Arctic: examples from seabird research, NRC Research Press, Ottawa (ON).
9. Natural Resources Canada. (2020). Economy Assessment of Geoscience Information (Final Report), Ottawa (ON). (Accessible only on the Government of Canada network).
10. Natural Resources Canada. (2019). 2018-19 Department Results Report, Ottawa (ON). PDF - 2.90 MB
11. Natural Resources Canada. (2012, October).  Evaluation of the Polar Continental Shelf Program, Ottawa (ON).  (Accessible only on the Government of Canada network).
12. Natural Resources Canada. (2013, December).  Audit of the Polar Continental Shelf Program Project AU1412, Ottawa (ON).
13. Government of Canada. (2016). PCSP 2016 Change Management Document, Ottawa (ON). (Accessible only on the Government of Canada network).
14. Government of Canada. (2018). PCSP 2018 High-Profile Projects, Ottawa (ON) (Accessible only on the Government of Canada network).
15. Government of Canada. (Undated). PCSP Business Plan 2016-2019 - 2019-2022, Ottawa (ON) (Accessible only on the Government of Canada network).
16. Government of Canada. (Undated). PCSP GBA+ analysis, Ottawa (ON). (Accessible only on the Government of Canada network).
17. Government of Canada. (2017). PCSP Input to Canada’s Fundamental Science Review, Ottawa (ON). (Accessible only on the Government of Canada network).
18. Government of Canada. (2016, August). PCSP Arctic Operations Manual, Ottawa (ON). PDF - 5.4 MB
19. Government of Canada. (2016). PCSP Operating Framework 2016, Ottawa (ON). (Accessible only on the Government of Canada network).
20. Government of Canada. (2019). PCSP Support Plan for the 2019 Season, Ottawa (ON). (Accessible only on the Government of Canada network).
21. Government of Canada. (1985). Resources and Technical Surveys Act (R.S.C., 1985, c. R-7. 1994, c. 41, s. 35. Section8 (1)).
22. Schwing, Emily. (2016, August 23) “Unraveling the Accidents of Climate Change (With rising temperatures and melting sea ice, hunting and traveling in the Arctic is becoming a riskier venture. Here’s what a changing environment could mean for search and rescue efforts)”. The New Humanitarian, Arctic Deeply. 
23. Senate of Canada. (2019, June). Northern Lights: A Wake-Up Call For the Future of Canada (Report of the Special Senate Committee on the Arctic), Ottawa (ON).  PDF – 4.5 MB

Appendix D: Financial Information

Figure 5: PCSP Financials by Fiscal Year

		2014-2015		2015-2016		2016-2017		2017-2018		2018-2019		2019-20		Totals		AVERAGE
		Budget	Actuals	Budget	Actuals	Budget	Actuals	Budget	Actuals	Budget	Actuals	Budget	Actuals	Budget	Actuals	Budget	Actuals
Salary	Salary - initial allocation	$1,114,834	$2,230,899	$1,537,257	$2,562,990	$1,537,257	$2,571,998	$1,537,257	$2,733,813	$1,601,052	$2,962,712	$1,563,245	$3,260,210	$8,890,902	$16,322,621	$1,481,817	$2,720,437
	Salary - transfer from DND	$750,993		$776,358		$944,755		$977,296		$1,060,475		$951,346		$5,461,223		$910,204
	Salary - Misc transfers from O&M, branch, etc	$365,072		$249,374		$170,975		$194,302		$229,329		$745,619		$1,954,671		$325,779
	Salary Other	$194,668	$193,490	$172,206	$172,206	$167,000	$166,838	$167,000	$167,000	$167,000	$170,949	$0	$0	$867,874	$870,483	$144,646	$145,081
	SALARY TOTAL	$2,425,567	$2,424,390	$2,735,195	$2,735,196	$2,819,987	$2,738,836	$2,875,855	$2,900,813	$3,057,856	$3,133,661	$3,260,210	$3,260,210	$17,174,670	$17,193,104	$2,862,445	$2,865,517
	EBP	$485,113	$484,878	$547,039	$547,039	$563,997	$547,767	$575,171	$580,163	$611,571	$626,732	$880,257	$880,257	$3,663,149	$3,666,836	$610,525	$611,139
	SALARY TOTAL + EBP	$2,910,680	$2,909,268	$3,282,234	$3,282,235	$3,383,984	$3,286,603	$3,451,026	$3,480,975	$3,669,427	$3,760,393	$4,140,466	$4,140,466	$20,837,818	$20,859,940	$3,472,970	$3,476,657
O&M and Other Expenses	O&M - initial allocation	$5,620,780	$15,609,239	$6,152,393	$17,906,653	$5,857,165	$14,974,744	$6,320,328	$18,152,774	$4,790,433	$16,974,452	$6,490,260	$17,630,668	$50,192,037	$101,248,529	$8,365,339	$16,874,755
	O&M - transfer from POLAR	$1,544,441								$1,704,000						-
	O&M - transfer from DND	$1,152,972		$1,170,775		$1,443,133		$1,273,535		$1,278,748		$1,477,382				-
	O&M - Transfers to Salary, other branches, etc	-$348,297		-$583,819		-$180,621		$23,403		$260,632		-$947,320				-
	O&M - Pass the Hat - ECCC	-		-		-		-		$358,000		-				-
	O&M - Budget Top Up	-		-		-		-		-		$4,672,375				-
	Transfer from UNCLOS	-	-	$661,339		-	-	-	-	-	-	-	-			-
	O&M- Crown disposal, GEM, Reserve	$456,507	$403,869	$309,198	$197,831	$249,156	$207,125	$170,352	$163,510	$158,900	$158,457	$62,892	$62,892	$1,407,005	$1,193,684	$234,501	$198,947
	O&M AND OTHER EXPENSES TOTAL	$8,426,402	$16,013,107	$7,709,886	$18,104,484	$7,368,833	$15,181,869	$7,787,618	$18,316,284	$8,550,713	$17,132,908	$11,755,589	$17,693,561	$51,599,041	$102,442,213	$8,599,840	$17,073,702
	Capital	$428,993	$428,992	$512,661	$311,652	$327,042	$327,033	$355,639	$355,639	$68,950	$68,950	-	-	$1,693,285	$1,492,266	$282,214	$248,711
	O&M - Special Projects	$1,332,000	$864,748	-	-	-	-	-	-	-	-	-	-	$1,332,000	$864,748	$222,000	$144,125
	O&M - Low Carbon	$30,000	$30,000	-	-	-	-	-	-	-	-	-	-	$30,000	$30,000	$5,000	$5,000
	O&M - Pass the Hat - NRCan	-	-	-	-	-	-	-	-	$358,000	$358,000	-	-	$358,000	$358,000	$59,667	$59,667
	O&M OTHER TOTAL	$1,790,993	$1,323,740	$512,661	$311,652	$327,042	$327,033	$355,639	$355,639	$426,950	$426,950	$0	$0	$3,413,285	$2,745,014	$568,881	$457,502
Other	Recoverables	-	-$7,701,931	-	-$9,855,128	-	-$8,337,981	-	-$10,833,689	-	-$8,826,180	-	-$5,937,971	$0	-$51,492,880	$0	-$8,582,147
	Totals (excludes EBP)	$12,642,962	$12,059,306	$10,957,742	$11,296,203	$10,515,862	$9,909,757	$11,019,112	$10,739,047	$12,035,519	$11,867,339	$15,015,799	$15,015,799	$72,186,996	$70,887,452	$12,031,166	$11,814,575
	Difference	-	$583,656	-	-$338,461	-	$606,105	-	$280,064	-	$168,180	-	$0	$0	$1,299,544	$0	$216,591
		-	4.84%	-	-3.00%	-	6.12%	-	2.61%	-	1.42%	-	-	-	1.83%	-	1.83%

Source: Program financial system.
Note: Totals may differ due to rounding.

Text version

Figure 5 in Appendix D is a table of the PCSP Financials by fiscal years 2014-15, 2015-16, 2016-17, 2017-18, 2018-19 and 2019-20. It illustrates the Budget and Actual amounts for each year.

Primary categories in the first column are:

Salary: Salary-Initial Allocation, Salary - Transfer from DND, Salary - Miscellaneous Transfer from O&M, branch, etc, Salary-Other and Other Expenses and Other, Salary Total, EBP, Salary Total plus EBP

O&M - initial allocation, O&M –Transfer from POLAR, O&M - transfer from DND, O&M - Transfers to Salary, other branches, etc., O&M Pass the Hat – ECCC,

O&M Budget Top UP, Transfer from UNCLOS, O&M Crown disposal, GEM, Reserve, O&M  and Other Expenses Total

Capital, O&M – Special Projects, O&M – Low Carbon,

O&M- Pass the Hat –NRCAN, O&M Other Total

Other: Recoverables, Totals (excludes EBP)

Figure 6: PCSP Financials - Totals and averages

		Totals (2014-2020)		AVERAGE (2014-2020)
		Budget	Actuals	Budget	Actuals
Salary	Salary - initial allocation	$8,890,902	$16,322,621	$1,481,817	$2,720,437
	Salary - transfer from DND	$5,461,223		$910,204
	Salary - Misc transfers from O&M, branch, etc	$1,954,671		$325,779
	Salary Other	$867,874	$870,483	$144,646	$145,081
	SALARY TOTAL	$17,174,670	$17,193,104	$2,862,445	$2,865,517
	EBP	$3,663,149	$3,666,836	$610,525	$611,139
	SALARY TOTAL + EBP	$20,837,818	$20,859,940	$3,472,970	$3,476,657
O&M and Other Expenses	O&M - initial allocation	$50,192,037	$101,248,529	$8,365,339	$16,874,755
	O&M - transfer from POLAR			-
	O&M - transfer from DND			-
	O&M - Transfers to Salary, other branches, etc.			-
	O&M - Pass the Hat - ECCC			-
	O&M - Budget Top Up			-
	Transfer from UNCLOS>			-
	O&M- Crown disposal, GEM, Reserve	$1,407,005	$1,193,684	$234,501	$198,947
	O&M AND OTHER EXPENSES TOTAL	$51,599,041	$102,442,213	$8,599,840	$17,073,702
	Capital	$1,693,285	$1,492,266	$282,214	$248,711
	O&M - Special Projects	$1,332,000	$864,748	$222,000	$144,125
	O&M - Low Carbon	$30,000	$30,000	$5,000	$5,000
	O&M - Pass the Hat - NRCan	$358,000	$358,000	$59,667	$59,667
	O&M OTHER TOTAL	$3,413,285	$2,745,014	$568,881	$457,502
Other	Recoverables	$0	-$51,492,880	$0	-$8,582,147
	Totals (excludes EBP)	$72,186,996	$70,887,452	$12,031,166	$11,814,575
	Difference	$0	$1,299,544	$0	$216,591
		-	1.83%	-	1.83%

Text version

This is a summary of the PCSP Financials for 2014-2020 that includes the totals and averages of the financial categories in Figure 5 outlined in the table above. Source: Program financial system.

Appendix E: PCSP Application Process

Text version

Appendix E illustrates the PCSP application process.

A pool of potential candidates from Canadian Universities and Federal Departments (excluding DND), Territorial Departments or Northern Organizations is created.

Applicants from the two groups complete an on-line-application.

The Canadian Universities applicants go through the following process:

There is a PCSP pre-screening of the applicants. This includes a feasibility assessment by PCSP.

A program review committee (PRC) that consists of external and internal personnel reviews the applications in an objective manner based on criteria.

Those projects prioritized selected by the PRC are then reviewed in terms of the support, in-kind, financial, equipment, etc., that can be provided to the selected project.

The Federal Departments (excluding DND), Territorial Departments, and Northern Organizations go through the following process:

The Co-ordinating DG is the principal reviewer for the project from his/her division department.

A feasibility assessment of the project is conducted.

This is followed by an allocation of the costs and in-kind support that will be available to the project.

The Co-ordinating DG then makes a decision re: allocation.

Following the vetting process,  for both Canadian and Federal Departments (excluding DND) and Northern, a draft agreement is prepared.

The next step is approval by the Delegated Financial Authority (Director PCSP) and/or amendments finalized.

DND/CFATC is the applicant for training in the Arctic at the Resolute facility.

A template identifying requirements for the DND training in the Arctic at the Resolute facility is completed.

Adjustments to the initial plan/template are completed.

PCSP develops the draft funding (facility, program support, off-season and improvements R&M), to meet DND requirements.

DND and PCSP conduct negotiations.

Following negotiations, a draft workbook and implementation plan are prepared.

A final workbook and plan are developed and include any adjustments.

DND sends supplementary transfer to PCSP.