December 2008
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Management Response and Action Plan
The Food Safety and Nutrition Quality Program (Food Program) is central to Health Canada's mission to help Canadians maintain and improve their health. This Program is delivered by the Food Directorate, within Health Canada's Health Products and Food Branch (HPFB), under the authority of the Food and Drugs Act and the related Food and Drug Regulations.
The objective of the audit was to assess the adequacy of the Food Program's Management Control Framework practices related to strategic planning, risk management, and controls over administrative processes.
The audit was conducted by the Audit and Accountability Bureau in accordance with the Government of Canada's Policy on Internal Audit. It covers mainly activities that took place during the period from April 1, 2005 to March 31, 2007 and reports on actions taken up to end of the field work, i.e., June 8, 2007.
The audit team examined the management control framework of the Food Directorate as it relates to strategic planning, risk management and controls over specific processes such as pre-market submissions, regulatory amendments and health risk assessments. In this regard, we noted the following areas for improvement:
Management agrees with all of the recommendations. Its response indicates its commitment to take action. In fact, the Food Directorate has already started to implement many of the proposed actions that will address the findings. The Directorate has developed the Regulatory Modernization Strategy for Food and Nutrition, which flows from the Branch's Blueprint for Renewal. This strategy, once implemented, will constitute a step in the direction to improving the Directorate's overall management control framework.
Maintaining the safety and nutritional quality of Canada's food supply is a shared responsibility among federal, provincial and territorial governments, industry and consumers. Health Canada is one of the major partners and assumes its share of this responsibility through the Food Safety and Nutrition Quality Program (Food Program).
This program is delivered by the Food Directorate, within Health Canada's Health Products and Food Branch (HPFB), under the authority of the Food and Drugs Act and the related Food and Drug Regulations (the Regulations).
The Food Directorate is responsible for:
The Food Directorate has a number of processes that make up its management control framework:
The Food Program has operations in the National Capital Region (NCR) and all other regions. The national laboratory network has facilities in Ottawa, Longueuil, Scarborough, Winnipeg and Burnaby. For the fiscal year ended March 31, 2007, it had total expenditures of $40 million and about 400 employees.
The objective of the audit was to assess the adequacy of the Food Program's Management Control Framework practices relating to strategic planning, risk management, and controls over administrative processes.
The audit focused on examining the four following lines of enquiry (LOE): the Food Directorate's management controls for strategic planning and priority-setting; administrative processes for evaluating pre-market submissions; the Food Directorate's role in fulfilling its obligations related to health risk assessments; and the development of amendments to the Regulations. Please see Appendix 1 for detailed audit criteria for each LOE.
Audit evidence was obtained from bureaus of the Food Directorate involved in the above-noted areas. The approach included interviewing management teams and staff members and reviewing relevant documentation.
Our audit concentrated on activities that took place from April 1, 2005 to March 31, 2007 as per our agreed-upon Terms of Reference.
The audit was conducted by the Audit and Accountability Bureau as per Health Canada's Multi-Year Risk-Based Audit Plan for the period 2006-2007 to 2008-2009, which was approved by the Departmental Audit and Evaluation Committee on October 4, 2006. The audit was conducted in accordance with the Government of Canada's Policy on Internal Audit.
Strategic planning is the process that an organization uses to define its long-term objectives, and make decisions on allocating its resources, including its capital and people, to pursue its strategy. This process is central to setting priorities which, in turn, influence a program's objectives, projects, and activities.
Given the importance of strategic planning, we expected that the Food Directorate would have conducted a strategic planning exercise on a regular basis, with due regard to the HPFB's strategic plan; that activities would align with and support the corresponding strategic objectives and related priorities; and that input would be obtained from stakeholders. We also expected the Directorate to have selected its objectives in accordance with key risks relating to food safety and nutritional quality issues.
The Food Program's activities for the period 2005-2008 are based on 12 "program areas" of food safety and nutritional quality. In addition, three support areas, referred to as "foundation areas", were also created "Management and Leadership", "Scientific Support" and "Infrastructure" (see Appendix 2). Each program and foundation area is led by a specific Food Directorate bureau director or senior staff member and includes two or more priorities. In turn, these priorities are pursued through a number of projects. This arrangement forms the basis for the Directorate's Program Area Framework.
The Program Area Framework was developed without first conducting a strategic planning process. It was derived from a former program framework, which was based on 40 project areas. Over time, these project areas were twice consolidated before being further rationalized into the current framework of 12 program areas. This consolidation has occurred even though no strategic plan has been in place for a number of years. In contrast, all other similar directorates within HPFB have developed a strategic plan.
In the absence of a strategic plan, the Program Area Framework lacks focus. The Framework does not identify high-level objectives for its program areas that cut across the Directorate. Instead, the objectives for these areas relate mainly to specific issues for which one of the Food Directorate's science bureaus is responsible. Furthermore, these objectives did not reflect or support the strategic objectives identified by the Branch in its strategic plan for the period 2004-2007. In addition, the two to four priorities associated with each program area vary in terms of their level of specificity and whether or not they have timelines for delivery.
The absence of a clear link between the objectives, priorities, programs and activities of the Directorate and its bureaus on one hand, and the high-level strategic objectives of the Branch on the other, flows largely from the lack of a strategic plan. Without the benefit of such a plan, the Directorate may not be either allocating its resources to dealing with the most significant risks in terms of food safety and/or nutritional quality issues, or delivering on commitments made in the departmental Report on Plans and Priorities.
The key stakeholders include: other government departments, HPFB's Office of Nutrition Policy and Promotion, the provinces and territories and groups such as health professionals, academia, and industry.
While the Food Directorate held some external stakeholder consultations prior to developing the Food Program activities for the period 2005-2008, there was no documented evidence on how the results of these consultations influenced the selection of Food Program activities for that period.
In 2006, the Food Directorate began to develop an initiative called the Regulatory Modernization Strategy for Food and Nutrition (Modernization Strategy). Although the Modernization Strategy had not yet been completed at the time of the audit, it represents a positive step toward correcting some of the shortcomings identified with the Program Area Framework.
One significant improvement is that the Modernization Strategy links directly to HPFB's Blueprint for Renewal, which also supports the HPFB's strategic plan for 2007-2012. Thus, through the Blueprint, the Directorate's Modernization Strategy now links with this strategic plan. One of the ten objectives included in the Blueprint specifically deals with food safety and nutrition quality issues. The Modernization Strategy expands on this objective by presenting five policy goals and their related objectives and sub-objectives, which also incorporate other objectives stated in the Blueprint and the Branch's strategic plan.
The Directorate has also made progress in obtaining input from stakeholders. Between September and December 2006, it consulted with key stakeholders on the development of the Modernization Strategy, and a public discussion document was posted on Health Canada's website in April 2007.
After having started to develop a new strategic plan for 2007-2012, the Food Directorate decided in March 2007 to use the Modernization Strategy for this purpose, as the development of both documents was seen as duplication. However, the Modernization Strategy does not constitute a full-fledged strategic plan since it lacks key elements such as specific medium-term and long-term outcomes, resource needs and timelines.
It is recommended that the Assistant Deputy Minister of the Health Products and Food Branch ensure that the Food Directorate both completes the development and implementation of its Regulatory Modernization Strategy for Food and Nutrition, and incorporate key missing elements into its strategic plan.
Agreed and initiated. The Food Directorate has completed the Regulatory Modernization Strategy for Food and Nutrition. This Modernization strategy which links directly to the Health Products and Food Branch Blueprint for Renewal and the Branch Strategic Plan was developed through extensive consultations with internal and external stakeholders.
Actions being taken:
The final version of the Regulatory Modernization Strategy for Food and Nutrition will be published by December 2008.
The Directorate will integrate key elements of the Strategy into its current draft Strategic Plan and use it to guide the development of the annual operational plan for the next two to four years. The Strategic Plan is expected to be completed by March 2009.
The Food Directorate currently receives pre-market submissions for ten different categories of food products (see Appendix 3). A pre-market submission is a request to Health Canada from an importer or manufacturer (the petitioner) to market a new food product in Canada. The Food Directorate evaluates these submissions for certain categories of food products, to ensure that the food product is safe (except for Health Claims for which the Department determines whether the claim is truthful and not misleading). Although the content of a submission package may vary depending on the category of food products, it generally includes, as a minimum, a description of the product, method(s) of production, detailed reports of tests conducted to establish its safety, and the text of all labels to be used in connection with the food product.
Globalization of the food supply and rapid advances in food science and technology have translated to an increase in the pace at which new food products are being introduced into the Canadian marketplace. Accordingly, the Directorate must devote a significant share of its human resources to complete evaluations of a growing number of increasingly complex submissions.
To add to this challenge, the Regulations impose stringent timelines for Health Canada to complete its evaluations. According to the Regulations covering three categories of food products (Food Additives, Infant Formulas and Novel Foods), Health Canada must, within 90 days (45 days for Novel Foods), notify the petitioner as to whether or not the Department will allow the product to be marketed in Canada.
Insufficient coordination between bureaus and divisions has resulted in inconsistencies in the conduct and the management of pre-market submissions. It has also prevented the introduction of a coordinated mechanism to screen submissions and to prioritize evaluations. In addition, until recently, the Food Directorate had no performance standard for completing submissions dealing with categories of food products not covered by the Regulations and had not required petitioners to respond to requests for additional information within a set time.
The shortcomings noted above have prevented the Food Directorate from delivering many of its decisions within the time limits set by the Regulations. Data available for 2006 indicates that 61% (17 out 28) of submissions on hand for Food Additives had not been completed within these time limits. The statistics were 97% (38 out of 39) for Novel Foods and to 89% (17 out of 19) for Infant Formulas. An inventory of outstanding submissions dated March 2007, showed that the Directorate had held 46% (45 out of 98) of them for more than one year since receiving them (see Exhibit 1). It is noted that many of the submissions older than two years at this time were outstanding because the Directorate was waiting for the petitioner to reply to a request for additional information.
| Category of Food Products | Less than 1 year | 1 to 2 years | 2 to 3 years | More than 3 years | Total |
|---|---|---|---|---|---|
| Food Additives | 23 | 9 | 10 | 12 | 54 |
| Infant Formulas | 19 | 3 | 1 | 0 | 23 |
| Novel Foods | 11 | 4 | 3 | 3 | 21 |
| Total (%) | 53 (54%) | 16 (17%) | 14 (14%) | 15 (15%) | 98 |
The Food Directorate's difficulty in complying with the timelines imposed by the Regulations negatively affects the food industry by postponing the introduction of food products to the Canadian market.
The Food Directorate has been aware for a number of years of its shortcomings in managing the evaluation of submissions. For example, commitments were made to develop formal guidelines clearly outlining the nature and quality of the data requirements for submissions, implementing a program-wide tracking system to manage all submissions, and developing service standards. More recently, similar commitments were made at the branch level in the strategic plan covering the period of 2007-2012. However, these commitments have not led, at the time of the audit, to significant improvements.
In fiscal year 2006-07, the Directorate initiated a new project aimed at modernizing its processes for managing pre-market submissions. This project includes establishing an integrated business process for managing all FD submissions, and performance measurements to improve, measure and report on the Directorate's performance.
It is recommended that the Assistant Deputy Minister of the Health Products and Food Branch ensure that the Food Directorate completes the development and implementation of its new management framework for evaluating pre-market submissions and complies with the timeline requirements stated in the Foods and Drug Regulations.
Agreed and initiated. The Food Directorate will continue to improve its approach to the review of pre-market submissions. A new pre-market submission review process that includes service standards for the safety review, and timeframes for applicant response to request for new information was developed and subject to internal and external consultations in 2007. A submission management unit was recently established for the central reception, tracking and coordination of submission reviews. Guidance documents to assist applicants in preparing quality submissions for food additives and novel foods were published in 2007 and 2008. A backlog reduction plan was implemented and, in the first phase, the Food Directorate after consultations with the applicants withdrew 30 out of 31 submissions that were more than two years old, and for which no response to our requests for additional information had been received. For the remaining submission, the applicant provided additional information, and it is currently under review.
Actions being taken:
The Directorate has developed a transition plan for the phased introduction of the improved submission review process. As noted, Phase 1 has been completed and Phase 2 of the backlog reduction plan for the safety assessment of food additives, novel foods and infant formulas is currently being implemented. The project targets a 90% reduction in the noted backlog by March 2010.
Some resources for developing the improved business processes and for backlog reduction have been identified through internal reallocation. In addition, the pre-market review of foods has been identified as a priority area in the consultation for the renewal of the Agricultural Policy Framework (Growing Forward).
In 1999, Health Canada signed a Memorandum of Understanding (MOU) with another government entity which, amongst other things, delineates the roles and responsibilities for conducting health risk assessments (HRA's) in situations in which there are no known cases of human illness.
According to the MOU, Health Canada should be involved in this category of HRA only in two specific circumstances: (a) either, no standard, policy or guideline dealing with a public health concern exists, or, (b) the existing standard, policy or guideline does not indicate an appropriate control for dealing with the emergency situation.
In fiscal years 2005-06 and 2006-07, the Food Directorate carried out, on average, 90 HRA's per year at the request of the other government entity, most of which were completed by the Food Directorate's Bureau of Microbial Hazards. In reviewing a sample of HRA files completed in those years, we found that the Food Directorate did not require the other government entity to clearly explain the rationale for requesting Health Canada to carry out the HRA in terms of the circumstances noted above. For this reason, we could not conclude that the Department had conducted these HRA's in accordance with the terms of the MOU.
We also noted that follow-up actions that the Directorate had taken, when deemed necessary, had not been documented. Such tracking would have enabled it to ensure that any issues raised in the request, with respect to its standards, policies or guidelines, had been addressed.
It is recommended that the Assistant Deputy Minister of the Health Products and Food Branch ensure that the rationale for conducting health risk assessments as per the terms of the 1999 Memorandum of Understanding is adequately documented to ensure compliance with the MOU and that HRA's be used systematically to inform policy and standard setting.
Agreed.
Actions being taken:
The Directorate will review current standard operating procedures (SOP). This will include a review of service standards, as well as the examination of documentation requirements and possible approaches to decrease response time.
The Directorate will implement a more systematic approach for the tracking, review and analysis of health risks assessments to help ensure that they inform policy and standard setting through detection of emerging issues and precursors of food safety risks.
These will be completed by the end of fiscal year 2008/2009.
To keep pace with rapidly expanding scientific knowledge and the development of new food products, the Food Directorate should be amending the Regulations in a timely manner. The timeliness of this process is important because some of these amendments deal with matters that could have public health and/or economic implications.
We noted that regulatory amendments to enable the use of food additives, to align regulations with new scientific knowledge or to address emerging issues are not completed in a timely manner. In fact, some projects have been active for more than 10 years. It is to be noted that this time is spent over and above the period required to develop underlying policies. Consequently, the audit focussed on identifying certain key factors that contribute to the lack of timeliness, and over which the Food Directorate has control. These factors include, but are not limited to, the staff complement and clarity of priorities, roles and responsibilities.
The Food Regulatory Program (part of the Food Directorate's Bureau of Food Regulatory, International and Interagency Affairs) is responsible for developing and managing regulatory amendments.
In recent years, the Food Directorate has recognized that the Program has not had sufficient staff to keep up with the demand for new regulatory amendments. Consequently, the number of employees has gradually increased to ten.
Most projects to amend the Regulations extend over several years. This means that at any given time, the Food Regulatory Program is dealing with a number of concurrent amendment projects. The Food Directorate has generally not established and communicated clear priorities for its various amendment projects. Priorities tend to shift suddenly. Staff have been moved from one project to another before the first has been completed. Some projects have been put on hold for several months waiting for resources to be reassigned. As a result, at the time of the audit, some 20 amendment projects were incomplete, sitting at various stages of the amendment process.
As per the Regulatory Agenda implemented by HPFB in the fall of 2006, the directorates must now report to the Branch, on a quarterly basis, the details of the regulatory amendments that they plan to complete within a specified time. They are also required to classify amendment projects as being of high, medium or lower priority. This exercise will likely enable the Food Regulatory Program to focus on those regulatory amendments that are of the highest priority.
All regulatory amendment projects originate from policy documents that the science bureaus have issued. These documents are then transferred to the Food Regulatory Program, whose role it is to convert them into regulatory amendments. However, even after such transfer has taken place, Food Regulatory Program staff still need to interact with staff in the science bureaus. This interaction is necessary to ensure that the legal texts, which are incorporated in draft regulatory amendments, adequately reflect the content and intent of the original policy documents.
Interviews have shown that the respective roles and responsibilities of the Food Regulatory Program and the Food Directorate's science bureaus with regard to the drafting process have not been formally documented. As a result, these two groups tend to work independently resulting in some policy projects to be transferred to the Food Regulatory Program without being ready to be converted into regulatory amendments. This tends to unduly increase the effort and time required for drafting legal texts.
It is recommended that the Assistant Deputy Minister of the Health Products and Food Branch ensure that the Food Directorate improve the management of its regulatory amendments.
Agree and being implemented. The Food Directorate is conscious of the need to improve the management of regulatory amendments. The Directorate commitment to addressing the regulatory issues of highest priority has meant that lower priority but important files have not been addressed in a timely manner. The Directorate also agrees that the business processes require review and modernization.
Actions being taken:
Regarding the issue of staff complement, the Food Directorate has reallocated resources internally and sought additional funding to support the timely completion of regulatory amendments. Funding was identified in the Food and Consumer Safety Action Plan. In addition, addressing such regulatory impediments was identified in consultation with industry as a priority area for Agriculture and Agri-Food Canada Growing Forward.
The Food Directorate is prioritizing its regulatory initiatives and allocating resources accordingly. The Directorate has also taken steps to improve the process for the management of regulatory amendments by integrating key project management principles and establishing closer contacts with partners to help secure support throughout the regulatory development process. Food Directorate has also launched a project to eliminate the regulatory amendments backlog, which is composed largely of food additives. This includes working with the Treasury Board Secretariat to streamline the regulatory process for low risk food additive regulatory amendments. A proposal is being prepared in collaboration with the Health Canada Regulations Section and a draft plan will be available by December 2008.
The Audit and Accountability Bureau examined the management control framework of the Food Directorate, as it relates to strategic planning, risk management and controls over specific processes such as pre-market submissions, regulatory amendments and Health Risk Assessments. In this regard, we noted the following areas for improvement:
Management agrees with all of the recommendations. Its response indicates its commitment to take action. In fact, the Food Directorate has already started to implement many of the proposed actions that will address the findings. The Directorate has developed the Regulatory Modernization Strategy for Food and Nutrition, which flows from the Branch's Blueprint for Renewal. This strategy, once implemented, will constitute a step in the direction to improving the Directorate's overall management control framework.
| Line of Enquiry (We were expecting that the Food Directorate would) | Audit Criteria |
|---|---|
| 1. Conduct a regular Priority Setting exercise to ensure that resources are allocated based on stated risks, objectives and strategic plans. |
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| 2. Perform Pre-Market Submissions (PMS's) analysis on a consistent basis and in compliance with FD's legislative obligations. |
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| 3. Perform Health & Risk Assessments (HRA's) with regards to Health Canada's mandate and ensure that results are used to influence the Policy Development process. |
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| 4. Have a process to ensure that amendments to the FDA and Regulations are developed and implemented in a timely fashion. |
|
| Program/Foundation Area | Lead Bureau | Number of Projects | FY 06-07 Budget ($000) (*) |
|---|---|---|---|
| Enhancing the Canadian Food Safety System | Bureau of Nutrional Sciences | 30 | 3,893 |
| Nutritional Quality and Safety of Foods | Bureau of Nutrional Sciences | 20 | 1,851 |
| Foodborne Pathogens | Bureau of Microbial Hazards | 27 | 2,697 |
| Emerging Pathogens and Prion Diseases | Bureau of Microbial Hazards | 14 | 2,384 |
| Health Implications of Foodborne Environmental Contaminants and Agrochemicals | Bureau of Chemical Safety | 28 | 4,195 |
| Food Surveillance and Monitoring | Bureau of Biostatistics and Computer applications | 16 | 4,237 |
| Food Allergens | Bureau of Chemical Safety | 5 | 1,004 |
| Natural Toxicants in Foods | Bureau of Chemical Safety | 24 | 2,231 |
| Nutrition Labelling and Claims | Bureau of Nutrional Sciences | 13 | 1,928 |
| Health Implications of Food Additives, Packaging and Processing Induced Chemicals | Bureau of Chemical Safety | 13 | 2,638 |
| Novel Foods / Processes and Innovations | Bureau of Microbial Hazards | 10 | 1,502 |
| Special Purpose Foods for Vulnerable Groups | Bureau of Nutrional Sciences | 12 | 1,217 |
| Management and Leadership | 8 | 3,015 | |
| Scientific Support | 26 | 2,730 | |
| Infrastructure | 12 | 1,587 | |
| Total | 258 | 37,109 | |
| (*) Unaudited financial figures |
| Category of Food Products | Lead Bureau |
|---|---|
| Food Additives | Bureau of Chemical Safety |
| Novel Foods | Bureau of Microbial Hazards |
| Infant Formulas | Bureau of Nutrional Sciences |
| Processing Aid | Bureau of Chemical Safety |
| Food Incidental Additives | Bureau of Chemical Safety |
| Food Packaging Materials | Bureau of Chemical Safety |
| Food Irradiation | Bureau of Chemical Safety |
| Novel Fibres | Bureau of Nutrional Sciences |
| Addition of Vitamins, Mineral Nutrients and Amino Acids to Food | Bureau of Nutrional Sciences |
| Health Claims | Bureau of Nutrional Sciences |