Schedule B – Other Items of Interest
Detailed Tax Debt Management Action Plans
Tracking of actions to address the recommendations of the Public Accounts Committee and the Office of the Auditor General of Canada (OAG) regarding the collection of tax debts by the CRA
Risk Management
The CRA ’s strategy to improve the risk management of its collections program will address the
OAG’s recommendation (8.52) that:
“The Canada Revenue Agency should establish a more comprehensive automated risk-scoring system for tax debts, update the risk scores on an ongoing basis, and use the risk scores to prioritize workload throughout the collections process.”
Specific Commitment(s) and Deliverables
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1. Establish processes to use new Risk Assessment Tools, build Risk Models and Scores, and implement.
- Risk models will be built in 2006-2007 and are currently scheduled for release over 2007-2008 for testing.
- Fully operational risk scores will be available for individual income tax accounts by March 2009.
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New target date is April 2009 (From March 2009)
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In progress and on track:
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Due to a high complexity in the automation of risk scores we anticipate a one-month delay in implementation. The Taxpayer Services and Debt Management Branch (TSDM) current focus is on
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- Developing the data infrastructure to support the research for the development of various risk models.
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- Developing a taxpayer profile that will include debtor history and various risk scores to assist in determining the next appropriate taxpayer treatment action.
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- Analyzing the value of using Equifax (credit bureau) risk scores that will be incorporated in the taxpayer profile.
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- Piloting a model that predicts the collections yield of a non-filer population. Initial results are encouraging.
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- Field-testing a collections model that anticipates the probability of case resolution in response to specific agency actions, thereby permitting CRA to more effectively allocate resources.
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2. Fully operational risk scores are scheduled for business programs by 2011.
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Deferred until funding source is secured
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Current funding and activities exclusively dedicated to T1 individuals
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File Management
The CRA’s strategy to improve the file management of its collections program will address the
OAG’s recommendation (8.65) that:
“The Canada Revenue Agency should minimize the number of collectors who work on each account, record their actions in a more systematic way, and improve the case management tools they have at their disposal.”
Specific Commitment(s) and Deliverables
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1. Improved file management capacity is currently scheduled for March 2009 for individual income tax collections and compliance.
- Integrated Taxpayer View Workbench
- Integrated Compliance Platform
- Workload Management Component
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New target date is April 2010 (From March 2009)
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In progress and on track:
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The CRA is committed to an enterprise wide case management system that will not be ready for 2009. Instead, it was decided to minimize investment in legacy systems and invest in an integrated Taxpayer view workbench mainframe application, nevertheless maximizing the achievement of the stated objectives. As a result the Branch shifted its focus on risk management for 2009.
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- A prototype of the “Integrated Taxpayer View Workbench” has been developed and is currently being progressively deployed to pilot sites for validation as originally planned. The workbench prototype will assist field officers in collecting debt.
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- Functionality that will record the results of collections actions will be done by improving the current case system to ensure employees record their enforcement actions.
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2. Business programs are currently scheduled to use the same components for improvements to file and workload management in 2011.
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Deferred until funding source is secured
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Current funding and activities exclusively dedicated to T1 individuals
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Performance Reporting
The CRA’s strategy to improve the performance reporting of its collections program will address the
OAG’s recommendation (8.41) that:
“The Canada Revenue Agency should significantly improve its management information to make it complete and comprehensive. It should develop reliable techniques and information sources to determine on a regular basis the results of its collection efforts and use that information to guide its decision-making for each of its major collection modes and actions.”
Specific Commitment(s) and Deliverables
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1. Improved performance reporting tools for individual income tax programs will be available beginning late in 2007, with fully operational reporting at the national, regional, local office, and individual officer levels scheduled for individual income tax programs by March 2009.
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New target date of April 2009 (From March 2009)
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In progress and on track:
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- Enhanced data accessibility provided through an updated version of All Revenues Table in late 2007. This will provide greater understanding of the impact of automated processes, such as letters, call centre, and bring forward (no action).
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The implementation of full operational reporting for T1 (individuals) will be delivered in April 2009.
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2. Performance reporting tools are currently scheduled to be progressively implemented throughout all major business revenue lines by 2011.
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In progress and on track:
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Reporting for Individuals will progressively incorporate other business lines.
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3. The CRA will collect information on collector actions through continued enhancement of its performance measurement systems by way of the Integrated Revenue Collections (IRC) project, which is scheduled to have its first major phase implemented by March 2009.
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New target date of April 2010 (From March 2009)
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In progress and on track:
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The CRA is committed to an enterprise wide case management system that will not be ready for 2009. Instead, it was decided to minimize investment in legacy systems and invest in an integrated Taxpayer view workbench mainframe application, nevertheless maximizing the achievement of the stated objectives.
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Progress continues to be made on improving performance information on the results of actions of individual collectors. Activities have been completed or are underway in the following areas:
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- Three different data marts have been built to support the development of various risk models, as well as data analysis and performance reporting capabilities.
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- Functionality that will record the results of collections actions will be done by improving the current case system to ensure employees record their enforcement actions.
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- The measure is the development of a “taxpayer folder” through which individual debtor history, including risk, will be gathered and made available for improved decision-making. This will assist in meeting the commitments made over the 2009-2010 period.
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Debt Management Research
The CRA’s strategy to improve its debt management research will address the
OAG’s recommendation (8.28) that:
“The Canada Revenue Agency should identify and collect the data it needs to analyze the makeup of its tax debt and to develop better collection strategies.”
(considering a variety of factors including fluctuations in the economic cycle).
Specific Commitment(s) and Deliverables
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Initial research model (to better understand the makeup of tax debt and the profile of debtors) is currently scheduled to be developed over 2006-2007 for individual income tax programs.
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- An Individual Tax Debtor Research Model has been completed and a number of related research initiatives have been completed or are In progress.
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Business program research model is currently scheduled to be developed in 2007, for implementation early in 2008.
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In progress and on track:
- Detailed articulation of a Business Tax Debtor research model is somewhat behind schedule due to delays in obtaining detailed data needed to validate our proposed approach to this area of research. We expect to recover from the delay and meet the stated goal of starting related research by early 2008.
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Build enhanced analytical capacity using IRC data-analysis enhancements, currently scheduled for 2009 for individual income tax accounts.
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In progress and on track:
- The data infrastructure in being developed to support the research and analysis to increase the capacity for debt management research using data already available in CRA.
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- Privacy Impact Assessment was prepared to address privacy issues relative to access to data for analytic and research purposes.
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Build enhanced analytical capacity using IRC data-analysis enhancements by 2011 for business programs.
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Deferred until funding source is secured. Current funding and activities exclusively dedicated to T1 individuals.
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5. Research Into Economic Indicators
Develop research approach and conduct study.
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In progress and on track:
- A research initiative has been launched with the objective of determining the timing and nature of any observable impact that reported economic variables may have on debt management, and whether the impacts operate in a consistent, measurable manner.
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Outstanding 1994 OAG Recommendations
“That the Canada Revenue Agency develop a detailed action plan that includes timelines and performance indicators for the implementation of the outstanding recommendations contained in chapter 29 of the Auditor General’s 1994 Report and submit that action plan to the Standing Committee on Public Accounts no later than 31 December 2006.”
- Two items involving risk-scoring and performance information have been included under Item 1.
- No further submissions to PAC will be made as our September 2006 report met with PAC requests.
Specific Commitment(s) and Deliverables
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1. An analysis of danger-of-loss scenarios is being conducted, and a final report will be produced by June 2007.
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In progress and on track.
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2. Performance standards will be established at the collector level through a tailored addendum to the existing performance management products to be implemented for all collectors beginning September 1, 2007. These standards will include the nature and frequency of debtor contacts, timeframes for resolving accounts, and use of legal action and other methods to collect amounts outstanding.
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In progress and on track:
- Work Assessment Checklist and tools have been developed. The initiative will complement performance management products rather than form specific addendum. Documents have been finalized and orientation sessions are underway with field. Union consultation ongoing.
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3. In response to the OAG's recommendation to monitor time spent by collection officers in both cash-generating and non-cash-generating activities, the CRA has already introduced more detailed time reporting on newly established speciality workflows.
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Complete (implemented April 2006)
- An internal order process has been developed and implemented to capture time spent on activities. The process is very detailed and includes all work activities handled by the field.
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4. The OAG reported that satisfactory progress had been made in respect of four additional items recommended in 1994:
- Large Debt Collections
- Ability To Pay Guidelines
- Tracking Results By Officer
- Annual Review Of Accounts
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Remaining PAC Recommendation
“That the Canada Revenue Agency report on progress on the implementation of this plan in its annual performance report, beginning with the year ending March 31, 2007.”
Specific Commitment(s) and Deliverables
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5. The Annual Report to Parliament will be modified to include this information.
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A progress update will be included in the CRA Annual Report to Parliament 2006-2007. The update focuses on the plan of action for implementing the Agency 2010 strategic vision through branch business transformation to strengthen core debt management business operations.
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Remaining OAG Recommendations
“The Canada Revenue Agency should minimize the number of collectors who work on each account, record their collection actions in a more systematic way, and improve the case management tools they have at their disposal. “
The Agency will undertake an initiative to identify file management inefficiencies and improve the effectiveness of collector actions on case inventories.
The Agency will build on process improvements it has made, such as the national collections call centre and national pools, to further improve its file management. More specifically, the Integrated Revenue Collections project will improve the case management tools available to perform all Agency collection activities.
Specific Commitment(s) and Deliverables
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1. A study of files managed by collectors will be conducted to validate the OAG observations and identify improvements to practices.
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The file reviews have been completed and initial findings on lower value and complexity accounts demonstrated that additional measures are needed to assure quality of work. This item has now been completed insofar as delivering on the management response to this 2006 observation.
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For information: An on-site quality assurance process has been developed for implementation in all offices by April 2008. The appropriate adjustments are being made to processes and budgets.
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Response to Parliamentary Committees, Audits, and Evaluations for 2006-2007
The following tables outline the CRA’s responses to reports by Parliamentary committees and the Auditor General in 2006-2007. They also list the internal audits and evaluations of the CRA that were published in the past year.
Responses to Parliamentary committee reports
Report 7 - Chapter 8, Canada Revenue Agency: Collection of Tax Debts of the May 2006 Report of the Auditor General of Canada (Adopted by the Committee on June 13, 2006; Presented to the House on June 21, 2006)
Government Response: Seventh Report of the Committee on Public Accounts, “Chapter 8, Revenue Canada: Collection of Tax Debts of the May 2006 Report of the Auditor General of Canada” (Presented to the House on September 29, 2006)
Report 9 - Parliamentary Review of the Canada Customs and Revenue Agency Act: A Value Proposition or a Failed Experiment? (Adopted by the Committee on December 12, 2006; Presented to the House on December 13, 2006)
Government Response: Ninth Report of the Standing Committee on Finance, “Parliamentary Review of the Canada Customs and Revenue Agency Act: A Value Proposition or a Failed Experiment” (Presented to the House on April 4, 2007)
The links included below are to the Auditor General reports, which include the CRA’s response.
Responses to Auditor General reports
Canada Revenue Agency - Collection of Tax Debts
International Taxation - Canada Revenue Agency
Internal audits and evaluations
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2005-2006 Selected Fiscal Year-End Procedures Audit
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Information Received under Memorandum of Understanding with respect to Joint Registration of Business - Province of British Columbia
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Information Received under Memorandum of Understanding with respect to the New Brunswick Business Registration Service System
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Cyclical Audits - T1 Transaction - Flow-through Audit
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Cyclical Audits - T2 / T4 Transaction - Flow-through Audits
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Information Received under Memorandum of Understanding with the Workplace Health, Safety and Compensation Commission of the Province of Newfoundland and Labrador
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Follow-up Audit of CRA Contracting Processes
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Information Received under Memorandum of Understanding with the Workplace Safety and Insurance Board of Ontario
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Follow-up of 2003-2004 Internal Audit Reports
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Governance of the Values and Ethics Environment
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Impacts of the Government's Secure Channel on CRA Program Delivery
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Large Business Audit Program Audit
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Information Received under Memorandum of Understanding with respect to Integrated Business Registration and Change of Business Information - Province of Ontario
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Use of Legislated Enforcement Provisions Audit
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For further information on audits and evaluations please visit: www.cra-arc.gc.ca/agency/internal/menu-e.html .
- Date modified:
- 2007-11-01
