Auditor general slams federal failures on ammunition, health-care stockpiles and more - Toronto Star

Also, the federal government's dental program was found to have blown past its budget for the first two years by about $1.1 billion. 

Auditor General of Canada Karen Hogan waits to appear before the Standing Committee on Public Accounts on Parliament Hill in Ottawa on Monday, May 4, 2026.

OTTAWA — In a series of damning reports, Canada’s Auditor General found the government can’t keep reliable inventories of either the military’s bullets or public health stockpiles, and has exceeded budgets on the dental care program, an overhaul of government call centres and a new customs system, while also failing to provide law enforcement with sufficient help tracking money laundering.

Several of the reports released Thursday, including audits of the Public Health Agency’s National Health Stockpile and Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) were follow-up audits. Auditor general Karen Hogan said she is seeing many of the same problems running through Thursday’s audits as well as past audits, including IT systems that are not up to the challenge and the government’s inability to keep inventories of critical supplies. 

“I am discouraged that more progress hasn’t been made on known weaknesses and that is a theme in many of our reports today, just not acting on known weakness in a timely way,” she said at a press conference after her reports were tabled in the House of Commons. 

Hogan concluded that FINTRAC failed to carry out its role in overseeing federal anti-money-laundering laws. That report concluded oversight was “weak,” with delays in providing financial data to police, taking an average of four months to hand over information after law enforcement flagged a concern. Half of those responding to a survey the auditor general undertook said the information arrived too late to be useful.

“If law enforcement agencies do not receive timely, actionable intelligence, this limits their ability to freeze assets, intercept transactions, or apprehend suspects to prevent money from being moved or laundered,” the auditor general concluded.

A second report concluded the Canadian Armed Forces failed to properly manage ammunition for regular uses like training and active deployments, as well as for strategic stockpiling. The report found “significant gaps” between the amount of ammunition needed and what was kept in the strategic stockpile, stating that “continued attention over several years” will be required to fix the situation.

The force keeps its ammunition — bombs, bullets and missiles — in two categories, with some reserved for regular training and use and another larger stockpile meant for emergencies. 

Hogan found, on average, over the last three years, the forces have only used 56 per cent of the ammunition assigned to them in a given year, raising questions about whether they understand the amount they require. She also found there was a large gap between what the forces said they needed for the long-term stockpile and what they actually had available. She said CAF members deserve to have the ammunition they need in the event of a crisis. 

“I have confidence that the Canadian Armed Forces will stand ready when called upon. This is about them being best prepared,” she said. 

The Carney government has ramped up defence spending to meet NATO targets, including increasing the production of ammunition here in Canada. Defence Minister David McGuinty said he accepts they have work to do. 

“We’re going to have to make sure we marry that production capacity with the storage, transportation, and use of that ammunition,” he said. “There’s progress to be made and we accept and fully intend to implement these recommendations.”

Another of Thursday’s reports found that the federal government’s dental program, which provides services to roughly 6.9 million people without coverage, has blown past its budget for the first two years by about $1.1 billion. The auditor general said Health Canada shifted funding set aside for future years to pay for dental care now, but that spending is forecast to exceed available funding through 2031-32.

Health Minister Marjorie Michel didn’t commit to bridging that shortfall, but as the program continued to roll out the government was examining ways to improve it. 

Meanwhile, another of the auditor’s reviews found that even after the COVID-19 pandemic, Canada’s National Public Health Stockpile was still allowing products to expire on the shelf.

Last year, the stockpile contained some 84 million expired items, mostly personal protective equipment. That same year, the stockpile sent $27 million in supplies to provinces and territories, but allowed $331 million in equipment to expire or get damaged, the auditor general concluded. Much of what the agency tossed was personal protective equipment like masks and gloves, in cases where they had huge volumes in stockpiles, well exceeding their own targets.

Michel said the government learned from the pandemic and is always looking for ways to improve, but some expired items are going to happen as part of that process. 

“If we have stockpiles that are expired, it’s because we have enough. We have enough PPE, for example, in place if something happens,” she said. 

The auditor found that while the stockpile generally did a good job storing rare vaccines and pharmaceuticals, a major part of its mandate, there were still mistakes. In one instance in 2024, workers repackaged drugs to optimize freezer space, but in doing so they left gaps in the door seals and more than $20 million worth of materials had to be thrown out.

The Public Health Agency did its own review and found workers didn’t follow established rules for repackaging, had insufficient freezer space and lacked a way to monitor when temperatures rose. The same problems had been found in 2022 and 2023 and the agency only started to address them in September 2025. 

An audit of a new computer system for customs imports at the Canada Border Services Agency (CBSA) found that even though it was three years late, it was not fully ready at launch, leading to workarounds that added up to 92,000 hours of employees’ time. The project is $60 million over budget and the workarounds were still in place 20 months after it was launched. 

Hogan also found a long-running plan to get the government’s 220 public services call centres under one roof has been both expensive and largely ineffective.

The government awarded a 10-year contract to IBM in 2015,  aiming to bring federal call centres under one new system. But as of 2020, only eight of those call centres had been brought onto the new system at a cost of $52 million, more than three times the initial budget. The government brought on a few more call centres after 2020, but is now in the process of launching a new process to replace them. 

Hogan said as the government starts to look for new contracts to update call centres, she saw signs the government may be making the same mistakes, potentially leading to call centres that simply don’t work.

“They weren’t learning from some of the lessons … we find that it’s really tight timelines right now to implement the new system and this really increases the risk that there could be a break in service,” she said.

Hogan said new computer systems and inventories might not be flashiest, but they are a basic backbone to a better public service and the government needs to address them rather than just working with broken systems. 

“I know people don’t like to invest in things you just don’t see, but IT systems and stockpiles needed in case of an emergency help make the country better prepared and provide better services to Canadians,” she said. “I guess my recommendation to the public service is when you know something’s not working, fix it.”

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Ryan Tumilty is an Ottawa-based reporter covering Parliament Hill. Reach him at rtumilty@thestar.ca  and follow him on X: @ryantumilty.

Alex Ballingall is the Deputy Ottawa Bureau Chief for the Star. Reach him via email: aballingall@thestar.ca