DR Fund Evaluation: Overview of the Return on Investment From the DR Fund As of March 2004 ^{Footnote 1}

Background:

Between 1998 and 2002, Dispute Prevention and Resolution Services (DRS) at the Department of Justice managed the disbursement of $6.9 million in funding for DR “seed projects” ^{Footnote 2}. To date, seven of the 51 DR Fund project recipients have provided DRS with firm cost savings data on their respective projects. Based on this incomplete evaluation data, we have identified over $6.884 million in cost savings as directly related to these projects.

The DR Fund sought to achieve four measurable results: funded organizations would reduce costs and time spent in managing disputes; parties to disputes would experience increased satisfaction with resolution outcomes; funded organizations would foster further internal DR developments; and, funded projects would serve as catalysts and/or models for other organizations. The follow-up research that DRS has undertaken demonstrates that the DR Fund has achieved impressive results, almost uniformly ^{Footnote 3}.

The most notable result, the $6.884 million in estimated savings, is very significant as it represents a “snapshot” of estimated cost savings from 1998 to 2003. We expect the DR systems now in place will continue to reap considerable cost savings for years to come.

Summary of DR Fund Recipients That Have Quantified Cost Savings:

The Canadian Human Rights Tribunal (CHRT): The CHRT received $63,990 from the DR Fund. The cost savings it identifies are based on the reduction in the number of hearing days due to the CHRT mediation program, less all costs incurred to settle complaints through that program. The CHRT saved approximately 242 hearing days from 1998 to the end of August 2003, and it reports cost savings of approximately $957,000 ^{Footnote 4}.
Fisheries and Oceans (DFO) Office of Early Conflict Resolution: DFO received $180,929 from the DR Fund to introduce a conflict resolution program aimed at reducing the number of grievances and complaints to the Public Service Commission and the Canadian Human Rights Commission. DFO reports that for the period 1999-2000 it avoided costs of $1.7 million ^{Footnote 5}.
Canadian Food Inspection Agency (CFIA): CFIA received $208,500 from the DR Fund and used the funds to create a settlement team that settled 53 litigation cases under the supervision of CFIA’s Dispute Prevention and Resolution Services. As a result, CFIA has conservatively estimated that over the time period January 1, 1999 to March 31, 2003, it realized savings in direct litigation costs of $2.5 million.
Correctional Services Canada (CSC): CSC received $356,000 from the DR Fund. CSC has reported that direct service delivery projects produced cost savings of approximately $1,145,000 over a one year period. This figure is based on the resolution of 230 conflicts through mediation. In addition, conservative cost savings of approximately $50,000 were reported from a CSC restorative justice project. Thus, total cost savings reported by CSC is approximately $1,150,000.
Canadian Transportation Agency (CTA): The CTA received $143,000 from the DR Fund. The CTA has calculated the average cost to the CTA of approximately $20,500 per hearing compared to average mediation costs per case of $7,041. This cost savings figure is based on the resolution of twenty-four (24) disputes through the mediation and pre-mediation work of the CTA’s Dispute Prevention and Resolution Services unit. The CTA has reported cost savings to date of $312,000.
Canadian Radio-Television & Telecommunications Commission (CRTC): The CRTC received $173,600 from the DR Fund. It has handled fifteen cases through its ADR practices since the development of its DR framework. The overall cost savings to the CRTC as a result of these matters being resolved through the non-traditional complaint process is estimated at approximately $240,000.

Need For Further Cost Savings Data:

DRS awaits additional data from some DR Fund recipients and many DR Fund recipients were unable to provide DRS with hard quantitative cost savings data. Projects that have been unable to provide hard cost savings data include the Canada Revenue Agency’s Office of Dispute Management, the Canadian Industrial Relations Board (CIRB), the Immigration and Refugee Board (IRB), and the Public Service Staff Relations Board (PSSRB).

While DRS believes that the cost savings from these projects have been significant, we do not yet have hard evidence to support this assessment. Anecdotally, we understand that the success of the PSSRB’s DR process has been one of the catalysts behind Treasury Board’s decision to require Deputy Ministers to implement informal conflict management systems in all departments and agencies as part of Public Service Modernization. Also, participants in the IRB project received the Head of the Public Service Teamwork award earlier this year. Hard data from these DR Fund recipients would be of considerable assistance in completing the DRS evaluation of the DR Fund.

Conclusion and Next Steps:

Our evaluation of the DR Fund provides clear evidence that DR investments by boards or agencies that hold hearings pay off many times over.

We have also learned that fund administrators, such as DRS, need to establish more rigorous evaluation frameworks at the very earliest point in the funding process. Recipients also need to implement more effective tracking systems to enable them to demonstrate through hard quantitative data whether non-litigious dispute resolution processes are cost effective or not.

Further, the “hard data” cost savings described above are only one part of the DR Fund story. The very positive “soft data” from participants in these various DR projects are also very impressive, particularly in relation to “access to justice” issues and outcomes. Unfortunately, considerable hard cost savings data and soft qualitative data have been lost as a result of poor evaluation practices.

DRS now intends to take the following follow-up steps. First, we will apply an evaluation framework to our activities, as we have has done for DR Fund recipients. Second, we intend to pursue the policy options associated with these successes, including a review of the potential for mandatory mediation in claims against the federal Crown. Third, we will publicize the results of these findings.

Footnotes

Footnote 1

This Overview is based on a detailed report on the DR Fund prepared by Mark McDonald at DRS.

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Footnote 2

Treasury Board provided $6 million and the DoJ $0.9 million of this total.

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Footnote 3

The CCRA’s Appeals Branch mediation pilot project has, until very recently, been described as the DR Fund’s most significant failure. It received $164,160 in 1999 from the DR Fund. Twenty-one cases were identified as suitable for mediation. However, only one mediation was completed (on March 11, 2003) and that result was largely due to the insistence of a major corporate taxpayer. The case involved an $80 million dispute. The litigation costs that would have been incurred by the Government of Canada if this mediation had failed are estimated by DoJ Senior Counsel to fall in a $500,000 to $1 million range. The CRA and DoJ are now reviewing the pilot project with a view to reviving it.

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Footnote 4

The CHRT mediation program was discontinued in 1999 and revived in 2003. DFO has calculated an average cost of $5,300 for each stage in its grievance process and average cost of PSC/CHR complaints at $32,300.

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Footnote 5

DFO has calculated an average cost of $5,300 for each stage in its grievance process and average cost of PSC/CHR complaints at $32,300.

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Date modified:: 2021-08-05

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Notice to readers:

DR Fund Evaluation: Overview of the Return on Investment From the DR Fund As of March 2004 ^{Footnote 1}

Background:

Summary of DR Fund Recipients That Have Quantified Cost Savings:

Need For Further Cost Savings Data:

Conclusion and Next Steps:

DR Fund Evaluation: Overview of the Return on Investment From the DR Fund As of March 2004 Footnote 1

Background:

Summary of DR Fund Recipients That Have Quantified Cost Savings:

Need For Further Cost Savings Data:

Conclusion and Next Steps:

DR Fund Evaluation: Overview of the Return on Investment From the DR Fund As of March 2004 ^{Footnote 1}