OTTAWA -- Peter McClure was denied pension disability benefits on a non-medical technicality.

The 63-year-old Alberta man has terminal lung cancer -- he says he's lucky to still be alive -- and waited about two years for a decision on his appeal of the government's denial of his Canada Pension Plan disability benefits.

The appeals tribunal accidentally missed his request for a speedier hearing, a situation that prolonged McClure's time in the system, which auditor general Michael Ferguson said on Tuesday was "longer than necessary for a decision."

McClure is one of thousands of people with terminal illnesses or grave conditions who applied for CPP disability payments in recent years and found themselves waiting too long for benefits, or being snowed under by paperwork, or caught in a system where applicants could be twice denied benefits, only to find out later the denials were wrong.

While the audit found no documented cases of patients dying while awaiting benefits, it did find that time limits were often missed. Only seven per cent of dying people who sought disability payments got a decision on their application within the government's 48-hour guideline, while just over half of those with chronic conditions had their cases decided within the established 30-day window.

And the appeals body established to streamline the process was set up without a proper transition plan and enough resources, leaving it unable to deal with the volume of cases it inherited from the four bodies that had handled benefits appeals. As a result, the tribunal didn't meet expectations, allowing the 6,500 cases it inherited to swell to a backlog of 10,871 cases by December 2014.

The tribunal has said it expects to be through the backlog by the end of March.

The auditor also questioned how decisions were made and how average wait times for a decision rocketed up to 884 days.

"It gives validation to, I would say, hundreds if not thousands of Canadians who quietly have struggled and continue to struggle with this very complex system," said Michael Prince, a public policy professor at the University of Victoria who has been a critic of how the previous government set up the tribunal.

Many of the findings in Ferguson's report come as little news to those in the system who have had their concerns documented extensively by The Canadian Press, including McClure.

In his latest twice-annual assessment of various federal government departments, agencies and programs, Ferguson's most eyebrow-raising findings came from his examination of CPP disability benefits, but he found shortcomings in other areas:

  • An audit of the government's central IT department, known as Shared Services Canada, found the four-year-old agency couldn't show whether it was saving the government any money, nor whether systems and data were secure.
  • Auditors found the Canada Border Services Agency was not keeping a close enough eye on exports, allowing high-risk shipments -- including illegal drugs and possibly illicit weapons technology -- to leave the country undetected.
  • Ferguson also found that 20 years after vowing to assess how legislation and programs affect men and women, the federal government had made limited progress on that front. Auditors found gender-based analyses were not always complete or consistent across departments.
  • An audit of the management of military housing by National Defence unveiled disarray, with as many as 1,500 units sitting vacant and not enough consideration given to allowing soldiers to rent in local markets off base.

The theme across every chapter of Ferguson's report to Parliament was that departments do some activities very well, but they just don't seem to see the big picture and don't try to learn how to make the whole system better, with the $4 billion disability benefits system a prime example.

"These are people who have worked in the Canadian workforce and they've made their contributions to the CPP and this is one of the benefits that they expect to be there when they need it," Ferguson told reporters at a news conference.

"The department needs to treat this as a service for people and make that whole system better."

For McClure, his experience eroded his faith in the system.

"It was a system designed to prevent people from collecting CPP disability. That was the result," McClure said from his home in Spruce Grove, Alta.

Ferguson's auditors found the problems with the benefits system started with a 42-page application that can take months to fill out, a burden that could be handled online, as is already the case with employment insurance.

Auditors found the department had little in the way of a quality assurance system to ensure decisions were consistent. The audit found that one-third of applicants originally denied benefits were later found to be eligible based on the original evidence. Two-thirds of those who went to the tribunal ended up winning their appeals, the audit said, raising questions about why any were denied benefits in the first place.

"The inconsistencies in the decisions -- I see that all the time in my job," said Allison Schmidt, a Regina-based, pension-disability case manager who's been a vocal critic of the tribunal.

The government has accepted all of Ferguson's recommendations to fix the disability benefits system, with measures already in place to speed up processing of applications on the most urgent of files, Social Development Minister Jean-Yves Duclos said.