Report on the Audit of Managing Demand

1. Executive Summary


The Department of Justice Canada (Justice) provides legal services to federal government departments and agencies across Canada. Steady growth in the demand, and corresponding cost, for these services led Justice to undertake a Legal Services Review in 2014 and commit to capping the total cost of Government of Canada legal services at $499.8M annuallyFootnote 1. Through the Legal Services Review, Justice, in partnership with its client departments and agencies (partner departments), launched a series of measures to improve productivity, cost effectiveness and business excellence of its operations.

The Managing Demand Initiative (MDI) was one of four measures that support a Legal Services Review commitment to “Redefine the Justice-client Partnership.” Under the MDI, Justice sought to manage the demand for legal services by:

  1. Working with partner departments to identify low risk, low priority work that does not require legal advisory support; and
  2. Enhancing the use of tools to help screen, triage, redirect, and resolve requests for legal services.

Looking beyond the completion of the Legal Services Review and the MDI in March 2017, the Justice executive management team has signalled that efforts to manage demand must continue to help ensure legal services remain fiscally sustainable in the long term. Justice’s vision for 2020 - Canada’s Legal Team – calls for ongoing efforts to manage demand by “working with clients as partners” through “ongoing discussions … to define ‘excellence’ and to identify priorities.”

Achieving this vision will require a shift in how Justice does business, as it moves from a traditional client-service model to a partnership with departments and agencies in which all parties work together to contain legal service costs and meet the government’s legal needs.


The Department has made good progress in achieving the MDI deliverables:

  • formal agreements have been reached with 44 of 45 partner departments to identify low risk, low priority work not requiring legal advisory support;
  • an inventory of tools and strategies to manage demand has been established and work is underway to gather and share the tools with departmental legal services units (DLSUs); and
  • the planned full-time equivalent (FTE) reductions have been achieved.

DLSU heads demonstrate a strong understanding of, and support for, efforts to manage demand. The process of negotiating the agreements has brought focus to the need to manage demand, and has laid a foundation for ongoing engagement with partner departments in these activities.

Areas for Improvement

While DLSUs are making progress in implementing processes and controls to support managing demand, areas for improvement were identified. Existing processes and controls vary in form and substance, due in part to the fact that departmental expectations for processes and controls have not been clearly defined and that opportunities to share best practices have not been formalized. Existing processes and controls also vary in completeness and maturity, due in part to the long-standing practices that exist between DLSUs and partner departments, and to the differing levels of partner department interest in containing legal service costs.

Further consultation and clarification will be required to define specific departmental expectations for managing demand beyond the MDI, including establishing control objectives and progress milestones. The sharing of best practices would also support efforts to enhance processes and controls, and help to identify new opportunities to manage demand.

Audit Opinion and Conclusion

In my opinion, Justice has made good progress since the launch of the MDI in 2014-15, and is on track towards achieving the MDI deliverables. Justice has established addenda with partner departments, identified work that will no longer be performed, and achieved the related 25 FTE savings. A listing of tools and strategies to manage demand has been developed, and the MDI team is working to gather and share these tools and strategies with DLSUs.

The MDI has established a strong foundation in enabling Justice to develop adequate and ongoing mechanisms to collaborate with partner departments beyond the completion of the initiative in March 2017. The creation of the Legal Practices Sector has allowed for a new governance body to support Executive Committee in defining, communicating and periodically reassessing continued efforts to sustain progress and support Justice’s longer-term approach to managing demand. Further progress will require establishing clear expectations and direction; enhancing collaboration and information sharing among DLSUs and Legal Practices Sector; and conducting periodic reviews of the adequacy of memoranda of understanding and related annexes/addenda in supporting managing demand.

Management Response

Management is in agreement with the audit findings, has accepted the recommendations included in this report, and has developed a management action plan to address them. The management action plan has been integrated in this report.

2. Statement of Conformance

In my professional judgment as Chief Audit Executive, the audit conforms to the Internal Auditing Standards for the Government of Canada, as supported by the results of the Quality Assurance and Improvement Program.

Submitted by:

Original signed by Inanc Yazar
July 5, 2016


Inanc Yazar, CPA CGA, CIA, CRMA
Chief Audit Executive
Department of Justice Canada

3. Acknowledgement

The Chief Audit Executive would like to thank the audit team and those individuals who contributed to this engagement and particularly, employees who provided insights and comments as part of this audit.

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