My mandate to review the activities of CSE and to report to the Minister of National Defence is contained in an Order in Council (see Annex A).
Each year, my office identifies areas within CSE's operations where, at first view, questions of lawfulness might be presumed. Under my authority, my office then conducts systematic reviews of these operations. I pass the results of these reviews to the Minister of National Defence in the form of classified reports. The fact that I have issued a classified report is not an indication that I have uncovered an incident of unlawfulness. Rather, it is an indication that the report contains sensitive information that requires classified handling.
The effort that goes into researching and preparing my reports to the Minister accounts for the bulk of the work of my office and gives me a detailed understanding of various aspects of CSE's operations.
I have reviewed CSE's authorities to collect foreign intelligence on behalf of the Government of Canada and its mandate to protect the security of the government's information technology. On an ongoing basis, I examine CSE's policies, directives and actual practices to ensure they contribute to lawfulness and to protecting Canadians' privacy.
Among other issues, my reviews have looked at how CSE provides intelligence reports to its clients, and the receipt of intelligence from its Second Party partners. I regularly monitor CSE's operational activities, as well as circumstances that have led to internal security investigations.
Annex B contains a list of the classified reports I have passed to the Minister since my appointment in 1996.
During the past year, I continued to review CSE's activities as they relate to the intelligence cycle and the handling and production of intelligence product. As I outlined in my last annual report, CSE conducts daily reviews of the raw traffic it receives from multiple sources and assesses its foreign intelligence value against the government's priorities. CSE then passes the results to its government clients in the form of intelligence product.
This past year, I reviewed the policies and handling practices associated with CSE's receipt and retention of foreign intelligence traffic. I examined how CSE identifies issues of intelligence interest within the raw traffic it receives and the practices associated with its retention and subsequent dissemination in the form of intelligence reporting. And, as is my practice, I reviewed CSE's policies and practices, within this cycle of activities, that deal specifically with safeguarding the privacy of Canadians.
I also reviewed CSE's information management policies in light of the National Archives of Canada Act and Treasury Board policy and guidelines related to the management of information holdings.
Government departments and agencies are required to establish Records Disposition Authorities for their operational and administrative holdings. These Authorities grant permission to departments and agencies to dispose of certain holdings and require them to forward to the National Archives other holdings identified to be of archival interest, for preservation.
I observed that these Authorities do not constitute a requirement to destroy records, nor do they provide direction regarding the timing of records destruction. Moreover, they do not provide or authorize records retention periods. Retention and disposal periods are determined by the designated Minister of the institution and must, of course, conform to any other applicable legislation.
I was satisfied that CSE's policies conform with existing law and policy requirements related to the management of government information holdings. I recommended, however, that CSE give priority to completing its retention and disposal schedules.
In my 1998-99 Annual Report, I indicated my intention to examine the new framework for policy authority, accountability and coordination that CSE had recently adopted. Of particular interest to me were two of the objectives of the framework: to identify the appropriate level of authority for various policies; and to provide a desirable level of operational flexibility in support of day-to-day activities.
During the past year, I reviewed the new framework and found it to be well conceived and sound. It will take time, however, to convert all CSE policy to the framework. While some policy gaps remain, CSE has policies for its major requirements, and the new system should address my earlier concerns about having policy in the right place and signed off at the right level.
During the year under review, I was pleased to learn that officials had opened discussions on having cornerstone internal policies issued to CSE as Ministerial direction. I applaud this initiative, because it will strengthen the accountability linkages between CSE and the Minister of National Defence, who is responsible for CSE in Parliament.
My mandate authorizes me to investigate complaints by Canadians or permanent residents of Canada about CSE activities. While there were informal inquiries during 2000-2001, none led to a formal complaint.
During the past year, my office has maintained its informal contacts within the security and intelligence community. We were particularly pleased to receive the Inspector General of South Africa during his autumn 2000 tour of North America. I look forward to renewing acquaintances with my counterparts from other countries at the upcoming conference of review agencies in Washington in October 2001.
I am satisfied that during the period under review, CSE acted lawfully in the performance of its mandated activities and did not target the communications of Canadian citizens or permanent residents. I make this statement on the basis of the thorough review of CSE's activities conducted during the year.
My mandate requires me to inform the Minister of National Defence and the Attorney General of Canada of any CSE activity that I believe may not be in compliance with the law. To date, I have not been required to do so. CSE is aware of its boundaries, receives legal advice from counsel appointed to CSE by the Department of Justice, and has policies and procedures in place to promote lawfulness. These measures have proven to be effective.
During the 2000-2001 fiscal year, my budget allocation was $648,800. I can report that actual expenses incurred were well within budget.
My office continues to consist of two full-time employees and a number of subject-matter experts whom I employ on contract. At present, there are five people performing specialized work under this arrangement, all of whom have the required security clearances. This provides me with both continuity and flexibility to obtain the expertise I require to review CSE's activities effectively.
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