Archived - CFIA User Fee Proposal: Overtime Fees
Summary of Stakeholder Comments and CFIA Responses

October 25, 2012 – January 11, 2013

Table of Contents

• Introduction
• About the Consultations
• Respondents' Comments and CFIA Responses
  • (a) Financial impact of fee increases/Inflationary factor increases
  • (b) Timing of fee increase
  • (c) Service standards
• Conclusion
• Next Steps

Introduction

The Canadian Food Inspection Agency's (CFIA) stated mission is to safeguard food, animals and plants, which enhances the health and well-being of Canada's people, environment and economy.

In order to achieve its mission, the CFIA delivers services for numerous programs. These services may be subject to user fees and are typically delivered during regular working hours.^Footnote 1 Expanded service windows^Footnote 2 also exist in some areas and occur when special efforts are made to schedule employees' regular working hours to expand the hours of operation beyond the typical eight hour period. Nonetheless, services are occasionally requested to be provided outside of the CFIA's regular working hours.

Current overtime fees are set out in the Canadian Food Inspection Agency Fees Notice, and are applicable when a service recipient specifically requests that a service be provided outside of the regular working hours or, where applicable, the expanded service window. These fees are charged regardless of whether the service being requested is of a health and safety, quality assurance, compulsory or non-compulsory nature.

Overtime fees are set to recover the additional costs to the Agency to deliver services outside regular working hours. Current rates have not changed since the Agency was created and are based on the rates of pay as per the relevant employee collective agreements in 1995. As such, the CFIA is looking to update the overtime fees in effort to reflect current collective agreement salary and benefit amounts.

Following the consultation guidelines set out in the CFIA Cost Recovery Policy and Framework and the User Fees Act, the Agency undertook a 75-day consultation on a user fee proposal to revise the CFIA's overtime fees from October 25, 2012 to January 11, 2013. This report consolidates and summarizes comments received from stakeholders and the public pertaining to the user fee proposal and the CFIA's response to those comments.

About the Consultations

The user fee proposal set out service standards and user fees anticipated to be fixed in the CFIA Fees Notice at a future date. A consultation document and a Questions and Answers document were posted online, with links available on both the CFIA external website and the Consulting with Canadians website. In addition, the Agency distributed notices to over 12,000 CFIA subscribers to inform them of the consultation. The CFIA also notified the World Trade Organization (WTO) of the consultation and provided links to the documents. Similar announcements were also distributed internally to CFIA staff, and requests made through existing business channels to inform stakeholders and post information on the consultation at CFIA District Offices.

To engage feedback, readers were invited to provide comments through a number of different ways including a web-based questionnaire, email, post and fax.

As a result, the CFIA received a total of five formal comments: three online questionnaire responses, and two letters, including a joint submission from two well established industry associations, who collectively represent a regular membership over 220 firms and over 150 associate members. In addition, the Agency responded to two phone messages, and participated in a teleconference with an industry association, all requesting someone to walk them through the proposal and answer questions.

Respondents' Comments and CFIA Responses

All comments were taken into consideration. Highlighted below, in no particular order, are the comments received through the consultation followed by the Agency's response, including resulting changes, if applicable, that have been made in the final user fee proposal to Cabinet.

(a) Financial impact of fee increases/Inflationary factor increases

Comment: The proposed overtime fee revisions represent a significant increase (>80%) from current overtime fees. Some stakeholders thought it was unreasonable that industry would be expected to absorb these increases.

Response: It is the Agency's position that the full additional cost incurred by the CFIA to provide user requested services in overtime should be recovered directly from the user requesting it, irrespective of industry sector or business. The current overtime rates have not been updated since the Agency was created in 1997 and are based on the rates of pay as per the relevant employee collective agreements in 1995. Current rates recover approximately 53% of the cost to the CFIA to provide services in overtime.

The CFIA's consultation document also set out annual increases to overtime fees by an inflationary factor equal to a five-year average CPI (as determined by Statistics Canada). As a result of the consultation, the Agency has reconsidered recommending annual inflationary increases at this time. In addition, it has rounded down the fee amounts to the nearest dollar. The final proposal for overtime fees will be simplified to reflect these changes, and look to fix fees for a five year period.

Moving forward, the Agency has committed to reviewing service standards and user fees at a minimum every five years in an effort to keep pace with current costs and minimize future changes.

(b) Timing of fee increase

Comment: The timing of the implementation of proposed fee increase for overtime fees (proposed: April 1, 2013) were considered to be problematic for industry to review and adjust operating budgets which had already been established to include potential overtime service costs based on previous demand and charges. The suggestion was made to provide at least a full year's notice prior to implementing any changes to fees. Additional suggestions were made to consider phasing in the fee increase over more than one fiscal year.

Response: Requests for services delivered in overtime are made at the discretion of the user. As such, the full additional cost (salary and benefits) incurred to provide user-requested overtime should not be subsidized by the general public; instead they should be recovered directly from the user requesting it irrespective of industry sector or business. Similarly, there are no plans to phase-in the revised overtime fees. However, in order to allow industry to accommodate the fee increase, the Agency is seeking implementation of revised fees effective no sooner than April 1, 2014. In its commitments to being open and transparent, the CFIA plans on communicating with stakeholders to update them on the user fee proposal and confirm the planned implementation date of revised fees as the process advances.

Comment: It was perceived that overtime fees were being reviewed and changed independently of the review of other user fees and modernization initiatives, such as Inspection Modernization and Regulatory Modernization. It was perceived that the review and implementation of revised user fees should wait until the outcomes of the various working groups were known and the revised service delivery models in place.

Response: The Agency is undergoing a number of change initiatives to modernize and improve service delivery to Canadians, including a comprehensive transformation of the regulations it enforces. Coordination of these initiatives occurs whenever possible and consultation is a key component. The CFIA is currently reviewing its service standards and user fees in efforts to align fees with the costs to delivering current services. Wherever possible, this review is being completed in coordination with and in support of Agency regulatory modernization and inspection modernization efforts, such as the Safe Food for Canadians Action Plan. A comprehensive review of the impacts to industry will be undertaken as part of the food regulatory modernization and accompanying user fee proposal.

As set out in the Agency's Cost Recovery Policy and Framework, the CFIA has committed to reviewing service standards and user fees every five years, or more frequently if there are significant changes as a result of other changes to service delivery.

(c) Service standards

Comment: Concerns were raised about the "lack of detail" around service standards associated with overtime.

Response: The CFIA agrees with the importance of establishing clear service standards for the services it provides. Overtime services are provided on request and as such there are no service standards directly related to the overtime itself, but rather are connected with the service being provided. For example, service standards that relate to the timeliness in which a service can be expected during regular working hours would continue to apply in overtime.

The CFIA is committed to excellence in our processes and practices and we strive for continuous improvement in dealings with our regulated parties and stakeholders. We are committed to providing quality service that is consistent, professional, timely and fair, based on the CFIA's Statement of Rights and Service for Producers, Consumers and Other Stakeholders.

Comment: Service standards for regular time service should be more detailed and published.

Response: The Agency is currently reviewing its service standards and user fees in tandem with regulatory modernization. In efforts to increase transparency, the Agency continues to work towards publishing and maintaining an inventory of its service standards as an online resource for stakeholders. As user fee reviews are completed and changes to fees in the CFIA Fees Notice implemented, the Agency will track and evaluate its performance in meeting its service standards and report on it annually through the CFIA's Departmental Performance Report.

Conclusion

There is a general understanding that overtime fees are not new fees. Stakeholders have also acknowledged that the CFIA is only looking to update overtime fees in order to be reflective of more current costs of delivering services outside of regular working hours.

No comments were received on the Agency's proposed change to limit the application of overtime fees so as to apply only if the service requested in overtime has an associated regular-time user fee. Therefore, there is considered to be support for this change.

It is clear that stakeholders would like greater clarity on how various different Agency initiatives, including the service standard and user fee review, relate and coordinate with each other. The Agency will continue to improve and maintain the information available to both internal and external stakeholders, including communication of ongoing modernization plans.

The consultation period ended January 11, 2013. The CFIA responded to stakeholders complaints both through written response and follow-up meetings (March 2013), and did not receive any requests for additional consideration of issues through an independent advisory panel.

Next Steps

The CFIA will finalize its user fee proposal to revise overtime fees and submit with its recommendation for tabling in Parliament (targeting fall 2013 session), as per the requirements of the User Fees Act. Once the Parliamentary process has completed, the Agency will request that the Minister of Agriculture and Agri-food fix the revised fees in the CFIA Fees Notice, as per the authority in the Canadian Food Inspection Agency Act.

The CFIA would like to thank everyone who took the time to share their views during this consultation process.