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37th PARLIAMENT, 2nd SESSION

Standing Committee on Fisheries and Oceans

EVIDENCE

CONTENTS

Thursday, September 25, 2003

1100

The Chair (Mr. Tom Wappel (Scarborough Southwest, Lib.))

Mr. Ron Thompson (Assistant Auditor General, International Affairs, Office of the Auditor General of Canada)

1105

The Chair

Mr. Alan Nixon (Committee Researcher)

The Chair

Mr. Peter Stoffer (Sackville—Musquodoboit Valley—Eastern Shore, NDP)

Mr. Joe Peschisolido (Richmond, Lib.)

The Chair

Mr. Ron Thompson

1110

1115

The Chair

Commr John Adams (Commissioner, Canadian Coast Guard, Department of Fisheries and Oceans)

1120

1125

The Chair

1130

Commr John Adams

The Chair

Commr John Adams

The Chair

Mr. John Cummins (Delta—South Richmond, Canadian Alliance)

Commr John Adams

Mr. John Cummins

Commr John Adams

Mr. John Cummins

Commr John Adams

Mr. John Cummins

Commr John Adams

1135

Mr. John Cummins

Commr John Adams

Mr. John Cummins

Commr John Adams

Mr. John Cummins

Commr John Adams

1140

The Chair

Mr. John Cummins

The Chair

Mr. John Cummins

Commr John Adams

Mr. John Cummins

Commr John Adams

Mr. John Cummins

The Chair

Mr. John Cummins

The Chair

Mr. Jean-Yves Roy (Matapédia—Matane, BQ)

1145

Commr John Adams

Mr. Jean-Yves Roy

Commr John Adams

Mr. Jean-Yves Roy

The Chair

Mr. Ron Thompson

Mr. Jean-Yves Roy

The Chair

Mr. Jean-Yves Roy

Mr. Ron Thompson

Mr. Kevin Potter (Director, Audit Operations Branch, Office of the Auditor General of Canada)

1150

Mr. Ron Thompson

The Chair

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

1155

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

The Chair

Mr. Kevin Potter

The Chair

Mr. Ron Thompson

The Chair

Mr. John Cummins

The Chair

Commr John Adams

Mr. John Cummins

Commr John Adams

1200

Mr. John Cummins

Commr John Adams

Mr. John Cummins

The Chair

Mr. John Cummins

The Chair

Mr. John Cummins

The Chair

Commr John Adams

Mr. John Cummins

Commr John Adams

The Chair

Mr. Andy Burton (Skeena, Canadian Alliance)

The Chair

Mr. Loyola Hearn (St. John's West, PC)

1205

The Chair

Mr. Loyola Hearn

Mr. Ron Thompson

Commr John Adams

Mr. Loyola Hearn

Commr John Adams

Mr. Loyola Hearn

1210

Commr John Adams

The Chair

Mr. Bob Wood (Nipissing, Lib.)

Commr John Adams

Mr. Bob Wood

Commr John Adams

Mr. Bob Wood

Commr John Adams

1215

Mr. Bob Wood

Commr John Adams

Mr. Bob Wood

Commr John Adams

Mr. Bob Wood

Commr John Adams

Mr. Bob Wood

Commr John Adams

Mr. Bob Wood

Commr John Adams

Mr. Bob Wood

Mr. Ron Thompson

Mr. Kevin Potter

Mr. Bob Wood

The Chair

Mr. Bob Wood

The Chair

Mr. Bob Wood

The Chair

Mr. Peter Stoffer

1220

Mr. Ron Thompson

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

The Chair

Commr John Adams

Mr. Peter Stoffer

The Chair

Mr. Peter Stoffer

The Chair

Mr. Andy Burton

1225

Commr John Adams

Mr. Andy Burton

Commr John Adams

Mr. Andy Burton

Commr John Adams

Mr. Andy Burton

Commr John Adams

Mr. Andy Burton

Commr John Adams

Mr. Andy Burton

1230

Commr John Adams

Mr. Andy Burton

Commr John Adams

The Chair

Mr. Bill Matthews (Burin—St. George's, Lib.)

Commr John Adams

Mr. Bill Matthews

Commr John Adams

Mr. Bill Matthews

Commr John Adams

Mr. Bill Matthews

Commr John Adams

Mr. Bill Matthews

1235

Commr John Adams

Mr. Bill Matthews

The Chair

Mr. John Cummins

Commr John Adams

Mr. John Cummins

Commr John Adams

Mr. John Cummins

Commr John Adams

Mr. John Cummins

Commr John Adams

Mr. John Cummins

The Chair

Mr. John Cummins

Commr John Adams

Mr. John Cummins

1240

Commr John Adams

The Chair

Mr. Loyola Hearn

Commr John Adams

Mr. Loyola Hearn

1245

Commr John Adams

The Chair

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

The Chair

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

Commr John Adams

1250

Mr. Joe Peschisolido

The Chair

Mr. Joe Peschisolido

Commr John Adams

Mr. Joe Peschisolido

The Chair

Mr. Peter Stoffer

The Chair

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

Commr John Adams

Mr. Peter Stoffer

The Chair

Mr. Peter Stoffer

1255

Commr John Adams

The Chair

Mr. Bob Wood

The Chair

Mr. Ron Thompson

The Chair

1300

Mr. Ron Thompson

The Chair

Mr. Ron Thompson

The Chair

Mr. John Cummins

The Chair

Mr. John Cummins

The Chair

Mr. John Cummins

The Chair

1305

Mr. John Cummins

The Chair

CANADA

Standing Committee on Fisheries and Oceans

NUMBER 049

2nd SESSION

37th PARLIAMENT

EVIDENCE

Thursday, September 25, 2003

[Recorded by Electronic Apparatus]

Á (1100)

[English]

The Chair (Mr. Tom Wappel (Scarborough Southwest, Lib.)): Order. Good morning, members, guests.

Pursuant to Standing Order 108(2), we are continuing our comprehensive study on the Canadian Coast Guard. Today we have witnesses from the Office of the Auditor General of Canada. They are Ron Thompson, Assistant Auditor General, Bill Rafuse, principal--I'm going to ask you what “principal” means when it's my turn--and Kevin Potter, director, audit operations branch.

From the Department of Fisheries and Oceans we have Commissioner John Adams of the Canadian Coast Guard.

Before we start, Commissioner, I'd just like to thank you very much for the promptness with which you responded to our detailed requests for information. We thank you very much for giving it to us. We appreciate it.

Just for the information of committee members, this committee is “defunct”--that possibly is the correct word--at two o'clock this afternoon and will have to be reconstituted pursuant to the order of the procedure and House affairs committee. The clerk will attempt to call a meeting as early as possible, possibly as early as Tuesday, but there's no guarantee of that. It will depend on the whips of the respective parties.

Of course, every day that goes by will be a day lost in our agenda with respect to the two items that we agreed we would work on. There was one item we forgot to mention, and I'm just going to throw it out here. I'm not asking for any comment. Perhaps we could get an update on the NAFO meetings from Mr. Chamut at some point. But that's only if we have time.

By the way, if I see nine members, I'd like to, if possible, just briefly interrupt the proceedings and ask for concurrence in the steering committee's report. That will only be if I see nine members.

Without further ado, we're going to hear from the Office of the Auditor General of Canada first, and then we're going to hear from the Department of Fisheries and Oceans. After that we'll proceed with our questioning in the usual manner.

Who is going to start off from the office? Mr. Thompson, of course.

Mr. Ron Thompson (Assistant Auditor General, International Affairs, Office of the Auditor General of Canada): Thank you very much, Mr. Chairman.

We really do appreciate this opportunity to discuss the audit work we've carried out in the Canadian Coast Guard. In particular, I'll highlight findings from chapter 31 of our December 2000 report and chapter 2 of our December 2002 report.

Mr. Chairman, I'm pleased that your committee has decided to look at coast guard issues, and I believe our reports on fleet management and marine navigation should be useful to you.

As you mentioned, joining me at the table are Bill Rafuse, principal, and Kevin Potter, director of our regional office in Halifax. Mr. Rafuse has just taken responsibility for the Halifax-based operations in our audits, in particular of Fisheries and Oceans Canada down there. Mr. Potter, on the other hand, is a director of long standing in that office and has worked very hard on both of the audits we're going to be discussing today.

Á (1105)

[Translation]

In Chapters 2 and 31, we concluded that the Department was not managing the areas we examined — that is, fleet management and marine navigation — in a cost-effective manner. Further, we stated that changes should be made, in our view, to ensure that user needs would be met in the future.

We believe that these findings are relevant because the Department plays a major role in providing services that are important to many Canadians. These services include aids to navigation, icebreaking, the marine component of search and rescue, and marine pollution prevention and response. The fleet also supports the Department in conducting fisheries science and enforcement, hydrography, oceanography, and other marine sciences.

[English]

The Chair: Excuse me, but at this point I would appreciate your indulgence. I notice that we have nine members, and while I have them, I'd just like to deal with a little bit of committee business, if you don't mind. It shouldn't take too long.

Members, your subcommittee met, and you have their report in front of you. I will read it as follows:

Your Subcommittee recommends that the Committee adopt the following programme:

That the Committee endeavour to complete a report on Atlantic fisheries issues no later than November 7, 2003; and

That the Committee hear further witnesses in relation to its study on the Canadian Coast Guard as of September 25, 2003 and endeavour to report to the House no later than November 7, 2003.

Good luck to us.

Your Subcommittee also recommends:

That the committee defray the expenses for the working luncheon held on Saturday, September 13, 2003 with Dr. Ragnar Arnason of the University of Iceland; and

That the Committee be authorized to purchase documents for the use of the Committee.

For your information, this last point deals with the idea that the subcommittee had unanimously...that we purchase a book entitled...

What's it entitled, Alan?

Mr. Alan Nixon (Committee Researcher): In A Perfect Ocean, by Daniel Pauly.

The Chair: Yes, In A Perfect Ocean. It's a very, very succinct description of what's happening in the world's oceans and the destruction of the world's oceans. We felt it would be appropriate for each member of the committee to have a copy.

Can I have a mover for the...?

Mr. Peter Stoffer (Sackville—Musquodoboit Valley—Eastern Shore, NDP): I so move.

Mr. Joe Peschisolido (Richmond, Lib.): I second it.

The Chair: Any discussion?

(Motion agreed to)

The Chair: Thank you.

And I believe you're on paragraph 5, Mr. Thompson.

Voices: Oh, oh!

Mr. Ron Thompson: On May 8, 2001, I had the honour of testifying before this committee on chapter 31, regarding fleet management. Our concerns back then were in three areas--organization and accountability, vessel life cycle management, and human resource management. In October of 2001 the public accounts committee also held a hearing on this same report. In December of 2002 the department reported on actions taken and planned in response to our observations in this chapter. This report may help your committee in its examination of the current status of coast guard issues.

Today I'd like to highlight chapter 2 of the December 2002 report that focused on the management of navigational support services and boating safety activities. These are services designed to meet the preventive side of the department's commitment to safe and efficient waterways. They include: marine communications and traffic services; aids to navigation; channel maintenance; navigable waters protection; navigational charts; and the regulation of recreational boats and boaters.

Now, in this audit we did not examine the department's response activities, such as search and rescue and environmental issues.

In 2001-02 the preventive activities that we did examine cost about $220 million. In addition, the department recovered about $30 million during this same period from marine service fees.

Á (1110)

[Translation]

The Department is facing new and changing service demands. Recreational boating is becoming increasingly important. Technological advances in the shipping industry and international obligations have an impact on service requirements. More recently, security concerns are creating additional demands for service. Fiscal restraint is a continuing reality.

Marine service fees have encouraged industry to become more involved in determining the service levels it needs. However, some in the industry still believe that the fees are too high for the services the Department provides.

Although technology is advancing rapidly, there are users who prefer to use traditional services. Therefore, while the Department is putting new navigational support systems in place, it is difficult to eliminate all of the older systems.

[English]

The department is aware, as I think you know, of many of the issues we've identified, if not all of them. It has initiatives planned or under way to deal with them. Still, there are barriers, as we've reported in this later chapter, that prevent the department from modernizing and delivering its navigational support services and boating safety activities in a cost-effective manner.

As we see it, the barriers include the following: a failure to establish one national program; the absence of key elements to ensure accountability; inadequate integration of navigational support services; provision of a service that does not contribute to the department's mandate for safety and efficiency; and the use of outdated legislation for unintended purposes.

With your permission, Mr. Chairman, I'd like to briefly discuss each of these issues.

In 1996 the coast guard merged with Fisheries and Oceans Canada. Subsequently, coast guard headquarters was reorganized. Some national standards are only now being developed or updated. There are limited means of ensuring that the existing national standards or targets are met. Frankly, without national targets, standards, and a monitoring capability, the department cannot hold managers accountable for achieving program objectives.

We found that there are five regional coast guards, each with their own way of doing business, and yet in the areas we examined, the department must meet both international and national requirements. Departmental business lines and internal shared services must work together, in our view, to deliver integrated navigational support services to users.

[Translation]

The Department has made considerable progress in developing frameworks for results-based management and accountability. A significant amount of work remains for the Department to make these frameworks operational. Until it does, the Department cannot show how its activities contribute to maritime safety and efficiency.

The Department made a commitment over five years ago to review the Navigable Waters Protection Act. This review has just begun.

In recent years, the Department has increased its emphasis on recreational boating safety. However it does not have stable funding to meet this responsibility. The Department relies on other organizations to deliver most of these services and receives little information on what is being achieved.

Á (1115)

[English]

In 1998 the government made a policy decision to maintain staff at certain light stations. The department had recognized earlier that it would be feasible to automate most of these light stations. As part of the decision to provide the funding to maintain staff, Treasury Board required the department to conduct a review of this decision by 2003. At the time of our audit, we found that the department had not tracked the cost of operating staffed light stations.

The department has indicated that it generally agrees with our findings throughout the chapter, and our recommendations. The deputy minister told your committee in June of this year that certain organizational changes regarding the coast guard were made in response to some of our findings. More importantly, we're encouraged that he has indicated that these changes are designed to deal with fundamental issues facing the department.

Mr. Chairman, as part of your examination of coast guard issues, you may wish to ask officials to provide an action plan that outlines the specific steps the department will take to address the concerns we have raised in our work.

Mr. Chairman, that concludes our opening statement. My colleagues and I would be very happy to answer questions throughout the hearing, as you wish.

Thank you, sir.

The Chair: Thank you very much, Mr. Thompson, and thank you for the tip.

We'll now hear from the commissioner and then we'll get right into questions.

Commissioner Adams, please.

Commr John Adams (Commissioner, Canadian Coast Guard, Department of Fisheries and Oceans): Good morning, and thank you, Mr. Chair.

It is a pleasure to appear before you today to present initiatives the Canadian Coast Guard is implementing that I believe will result in a better focused and better managed organization. Coast guard staff are currently involved in the review and delivery of several unheralded but very important issues and services. They include modernizing our aids to navigation program; upgrading delivery of marine communications and traffic services; modernizing the fleet; implementing an asset management system; and pursuing legislative renewal, specifically for the Canada Shipping Act and the Navigable Waters Protection Act.

[Translation]

At the same time, the Coast Guard delivers search and rescue services on a daily basis, provides icebreaking services, delivers a national aids to navigation system, promotes safe boating, protects the right of Canadians to navigate our waters, and manages a marine pollution program to protect our waters.

[English]

My main focus today, however, is to update the committee on how the department is responding to the two recent reviews by the Auditor General. The first is chapter 31 of the Auditor General's report of 2000 on fleet management. It found that the coast guard fleet could be managed more efficiently and effectively. The second is the 2002 Auditor General's report on safe and efficient navigation. In that report, the Auditor General observed that the coast guard's preventative services could be managed in a more cost-effective manner.

The department welcomed the constructive scrutiny of the Auditor General and accepted the findings contained within both reports. We remain committed to developing and implementing solutions. Today I will review with you where we are in terms of our initiatives.

First, though, you should be aware that the Standing Committee on Public Accounts has considered both of these audits. Most recently in May of this year, SCOPA tabled its report on chapter 2 of the 2002 Auditor General's report. The government's response to this report will be tabled in Parliament by October 10, 2003.

I wish to focus your attention on the progress we have made with the fleet management renewal initiative. This initiative has many parts, but in general they will fall under three topics: how we allocate money to the fleet and how we cost its activities; how we crew the ships and provide shore support to the fleet; and finally, how we plan, prioritize, and undertake the work of the fleet in consultation with our clients.

[Translation]

We have simplified the budget allocation process by splitting it into two components. The first component covers all of the fixed cost of the Fleet, in other words, the cost of owning the Fleet and having it available for operations. The second component deals with those additional or variable costs specifically required by the Fleet to deliver the various DFO programs. This would mean, for instance, the cost of the crew is fixed because the ship cannot sail without the crew but the cost of the fuel for the voyage would be a variable cost incurred to deliver the program.

Á (1120)

[English]

With respect to being able to demonstrate the cost of those services, we are developing a catalogue of standard costs associated with using the fleet to assist the fleet and their clients in planning, budgeting, and monitoring the costs of the ships' activities.

To close the loop, the coast guard is also putting in place a performance management system that will drive continuous improvement and demonstrate to the fleet's clients where their money is being spent and what they get for it. This is not easy to do, as it requires many different systems providing information to one central place. However, we have made great strides, and hope to have the system in place by the spring of next year.

With respect to crewing our vessels, we are speaking with the Public Service Alliance of Canada, PSAC, and the Canadian Merchant Service Guild, CMSG, to simplify the assignment of crews to ships where and when we need them. A key objective to achieving this is to reduce the number of crewing systems in use.

We have also established a common shore support structure for the regional management of the fleet to standardize fleet management functions across the country.

In the area of fleet planning and prioritization, the coast guard has implemented a zonal approach that brings together the DFO program's clients and the service provider--the fleet--to ensure the most cost-effective way to deliver DFO programs at sea. This ensures that the priorities of the programs are matched to the availability of the ships and resources from both regional and national perspectives.

In the end, as commissioner, I chair a senior committee made up of program assistant deputy ministers and regional directors general to ensure the system is working as efficiently as possible.

[Translation]

In the December 2002 report, the Office of the Auditor General examined DFO's contribution to safe and efficient navigation. Similar to the audit on fleet management, the Auditor General observed that navigation services were not being managed in a cost-effective manner. However, it is reassuring to note that the Auditor General found that the users of these services were satisfied that their needs were being met and the services are contributing to safer navigation.

[English]

In this report, the Auditor General made six recommendations. Five of the recommendations focused on management practices. They were: the Canadian Coast Guard should ensure that there are up-to-date policies, standards, and levels of service or expectations; the implementation of results-based management and accountability frameworks, otherwise known as RMAFs, should be completed; the coast guard should complete and implement its draft guidance on risk management; strategies to modernize and integrate the delivery of navigational support services should be developed and implemented; and finally, information on boating safety should be gathered and monitored.

In additional to these management practice recommendations, the Auditor General further recommended that DFO develop and implement an overall strategy for the future of its light stations.

The department has recognized these same issues and has a number of initiatives underway. In fact, we had been striving hard to develop, implement, and achieve improvements in management practices over the past few years.

[Translation]

One of the first initiatives undertaken to strengthen Coast Guard's management practices was revamping the role and organization of national headquarters. This reorganization has been recently completed and has provided a structure within which other activities are being pursued. For example, we are currently developing a Coast Guard financial management network, life cycle material management for our assets, performance management tools, and risk management tools. Once these initiatives are fully integrated, they will collectively allow for the more efficient and effective management of our programs.

Á (1125)

[English]

Recent specific developments for navigational services include the development of a marine program decision framework. This will ensure the coast guard has integrated its program mandate, policies, levels of service, and the business management components of program delivery. This will allow the coast guard to develop the capability to monitor the delivery of programs and services and assess the results achieved.

The development and implementation of results-based management and accountability frameworks are seen as key tools to improve the efficiency and cost-effective management of programs. Much work has been undertaken in developing these frameworks for the services that are provided by the coast guard. The coast guard will implement these frameworks once completed.

As indicated during the fleet discussion, the coast guard is also developing performance management frameworks. These are critical to the successful implementation of the results-based management and accountability frameworks. We are currently assessing our ability to gather and report on key indicators that have been identified.

Risk management policy and risk management tools have been developed and will be used to assess risk in selected waterways starting this fiscal year. Risk management principles and concepts will also be incorporated into the business management practices of the coast guard's integrated decision framework.

The CCG is constantly seeking ways to modernize and integrate the delivery of its navigational support services. The recent change in the departmental management model that places regional operations under my responsibility is seen as a means to enhance the coast guard as a national institution.

The Auditor General further recommended that DFO develop and implement an overall strategy for the future of its light stations. A project team and terms of reference have been established. Assessment work is underway, with a report expected by December 2003.

Other recent developments include the provision of up to $94.6 million over two years by the federal government for the refurbishment of our existing fleet and shore-based assets. The government has also announced that it will provide up to $27.5 million over the next five years for the implementation of an automatic identification system. This system will increase the federal government's awareness of marine activity within Canadian waters.

One last point, if I may. The Department of Fisheries and Oceans is currently undergoing a departmental assessment and alignment project to align its mandate and priorities to its resources. Other possibilities for improving coast guard operations may result from this project. The actions I have already discussed are being coordinated with this exercise.

[Translation]

That concludes a brief overview of some of the many initiatives currently underway. Although the strain on our aging fleet will continue to show until sufficient reinvestment is made, I believe we are on track. We continue to develop better ways of doing business to manage the gap between available and required resources and desired results.

Thank you very much.

[English]

The Chair: Thank you very much, Commissioner.

You might be interested in knowing that your presentation took 12 minutes, which is excellent. Thank you.

I appreciate both the witnesses providing us with written documentation, because that way we can make little notes about the questions we want to ask and it's a little easier.

Before I call on our first questioner, I have a couple of things.

Commissioner, just so that I can put it on the record, I notice on page 2 of your remarks that you indicated the coast guard is presently involved in the review and delivery of several unheralded but very important issues. One of them you list is the upgrading delivery of marine communication and traffic services. I would suggest that was very much heralded in our report of 2001, where we certainly recommended in no uncertain terms that the government provide more money for MCTS.

The other point I'd like to make—I don't know if members are yet aware, as I was only recently made aware—is that the supplementary estimates, insofar as they affect the Department of Fisheries and Oceans, provide for $42.3 million going to the coast guard this year under the heading of “refurbishment of capital assets”. In the closing remarks, Mr. Commissioner, you indicated that the government was going to provide $94.6 million over two years for the refurbishment of the existing fleet. I am just wondering if that $42.3 million is part of the $94.6 million and whether, before we begin any questioning, you have any comments about the allocation of the $42.3 million and what it's going to be refurbishing.

Á (1130)

Commr John Adams: It's what we're calling the national support project, and it's being coordinated from the headquarters. What it will address is all of our most urgent demands with respect to refurbishment across the entire spectrum of our fleet and in fact shore-based infrastructure.

The Chair: And it does form part of the $94.6 million.

Commr John Adams: It does indeed. It's part of the $94.6 million, which was over two years, which was $47 million in round figures. The $42.3 million is part of that.

The Chair: Thank you very much.

We'll begin our questioning with Mr. Cummins, for ten minutes.

Mr. John Cummins (Delta—South Richmond, Canadian Alliance): Thank you very much, Mr. Chairman.

I want to thank the presenters for being here this morning.

Mr. Adams, I have some comments and some questions for you. I appreciate your report this morning. I would say that in listening to you present it and read it, you understand, I'm sure, that this committee is a committee of the House of Parliament, and to function properly and to do the people's business we require accurate information.

You appeared before this committee on June 12 of this year. I asked you at that time repeatedly if the cost for a hovercraft, the Liv Viking, was $10 million. This was the figure “floating around”, was the term I used was, and you said “I wonder who's floating it”. In other words, you questioned the number I gave you, and you repeatedly said the figure was $6 million. That was on June 12.

Mr. Commissioner, on June 4 you approved a document that says that Hoverwork will deliver Liv Viking in early 2004 at a total cost of $10 million. How is it that eight days after approving that document, approving that price of $10 million, you advised this committee, not once but repeatedly, that the $10 million figure was inaccurate; that in fact it was $6 million?

Commr John Adams: You will recall, at that time, Mr. Cummins, that we had not concluded negotiations with the company. In fact, that was not concluded until much later in the summer.

What I said was I could not give you anything more than the number that had been quoted in public documents up to that point in time, which was $6 million. In fact, the actual cost of the work they're doing on the hovercraft is, round figure, $6.7 million. But $10 million is the all-up cost to include all aspects, including the number we always put in for contingencies.

So, for two aspects of the answer, first of all, in June I was not about to prejudice negotiations with the company by talking about a number, other than the public number that was on the record as being in the order of $6 million. Secondly, now that we have finalized negotiations, the actual cost is $6.7 million and the remainder is contingencies, etc. I can provide you with the details of that now, because of course we finalized the contract.

Mr. John Cummins: The coast guard document is quite clear, Mr. Adams, and it says, “Hoverwork will deliver Liv Viking in early 2004 at a total project cost of $10 million...”.

Commr John Adams: Total project cost, yes, but that's--

Mr. John Cummins: That's what you were asked.

Commr John Adams: No, you asked me what the price of the hovercraft was going to be, and I couldn't give you that at the time because that would have been public knowledge and it would have prejudiced the negotiations. That was an indicative figure at that time and it had not been finalized. We had not signed a contract. Until we'd signed the contract I was hesitant, as I explained, I think, at the time, to talk about a real so-called number until such time as we'd finalized negotiations.

We've now done that and the number is real, and it's $6.7 million, plus contingencies and other associated project costs.

Mr. John Cummins: That brings it up to the $10 million in the document that you were aware of when you appeared before the committee. Don't you think it appropriate, then, that at some time between June and now you would have advised the committee of the incorrectness of your original projected cost?

Commr John Adams: No, because it wasn't incorrect. The projected cost was estimated at $6 million. And it is coming out at round figures, $6 million, and the total project cost is in the order of $10 million.

There was nothing incorrect about my answer.

Á (1135)

Mr. John Cummins: The cost of delivering the Liv Viking is $10 million. That was what you were asked in June.

Commr John Adams: No, you asked me what it was going to cost us for the Liv Viking--

Mr. John Cummins: That's correct...delivered in Vancouver.

Commr John Adams: I did not want to deliver that number at that time because it might have prejudiced our negotiations with the company.

Now it's a public document, we've signed the contract, and it's come out at $6.7 million. I don't see any contradiction there at all.

Mr. John Cummins: Well, there is, Mr. Adams. It's unfortunate that you can't distinguish between the reality here, which is a $10-million delivered price in Vancouver, and the $10 million that you indicated on that document. There's a huge difference between that and the figure you gave this committee of $6 million.

Along that same line, Mr. Adams, the committee here is attempting to do a study of the coast guard, and it must have the ability to talk freely to members of the coast guard to get their opinion, to understand how the coast guard operates, and so on. Yet recently you sent a directive to all members of the coast guard, a member of Parliament inquiry form in which, and I'm quoting from the document, “All staff are required to report contacts with members of Parliament, senators or their representative within 24 hours of contact.” Some of the coast guard folks are already expressing concern. They feel their rights are being violated by having to comply with this document.

I think my next concern is one that concerns all members of this committee, not just me. If coast guard personnel are required to work through you for all questions that we're being asked, it would seem to me that there's one answer that we're going to get, and that's the corporate answer that's favourable to you. It may not be the kind of appropriate, real-time answers this committee may be looking for.

Commr John Adams: It's unfortunate, Mr. Cummins, that there has been some misinterpretation of what we intended by that document, and I will admit there has been some.

What we intended by the document was not that people wouldn't talk and respond immediately if it was in their area of expertise and within their capacity to respond to people like yourselves, senators, or your representatives. That was never the intent.

All we wanted to know was whether there was a contact and what was said. That would then better enable us to prepare ourselves to either elaborate on the answer or to anticipate further questions so we could better respond. That was all that was intended.

Obviously any of our members, like any other Canadian, can speak to members of Parliament or whoever they choose to speak to. It was just that if the contact came from the outside in, all we wanted to know was that there was a contact so we could respond in a perhaps more appropriate or a more fulsome manner, particularly if the expertise or the information you were looking for wasn't available with the contact you had made. So if they said no, then we'd know, all right, we'd have to try to find somebody who could give the answer.

That was the only intent of that document. In fact, it's a departmental approach, simply to keep ourselves apprised of who's asking what about the coast guard so we're better informed and we can inform our minister, for that matter, with respect to what people are asking about the coast guard.

Á (1140)

The Chair: Mr. Cummins, if you have time, can you make a copy of that document available to the committee?

Mr. John Cummins: Absolutely.

The Chair: Thank you. Go ahead.

Mr. John Cummins: As far as I'm concerned, Commissioner, you're telling us that there's one set of responses that's appropriate from the coast guard, and that's the set of responses that your office deems appropriate.

Let me give you an example.

Terry Tebb, who's your man in charge now in British Columbia, was about to appear on the CKNW radio station in Vancouver. The subject was an interview that I had had prior to Mr. Tebb. And the advice that was given to yourself from your media person in Vancouver was that Mr. Tebb would be conducting this interview or participating in this interview.

It says, “John Cummins discusses the purchase of the Liv Viking.” And it says, “As usual, he doesn't let the truth get in the way of what he says to the media.” It goes on to say, “I have sent this on to Terry to see before his interview with Peter O'Neill.”

I'd like you to elaborate on the mistruths that I'm spreading to the public, Mr. Adams.

Commr John Adams: I wouldn't call them mistruths. You use facts in a fashion much different from how we would use facts and your emphasis is on different syllables. That's the point that's being used.

Mr. John Cummins: You said that it says he doesn't let truths get in the way of what he says to the media, Mr. Adams. What does that mean?

Commr John Adams: It means that your presentation of the facts is quite different from ours and it could be misinterpreted as a response that is quite different from what we would consider the response to be.

Mr. John Cummins: I'll tell you what it means, Mr. Adams. It means that you don't understand the difference between $10 million and $6 million when you're talking to this committee. And you also don't understand what “lie” means, because that's what your document is accusing me of doing. And that's a sad commentary on the leadership of the Canadian Coast Guard, Mr. Adams.

The Chair: And that's where we are going to stop at this round.

It reinforces for me the importance of the use of words and how important the cost of the Liv Viking is and what the project costs are.

So the important question will be, what does it come in at in January or whenever it is in 2004? Does it come in at $6.7 million, or does it come in at $10 million? Are all those contingencies used up? I guess we'll find out in about four months or so.

Mr. John Cummins: I have a point of order, Mr. Chairman. I think it's incumbent on this committee to examine in detail the response of the commissioner on that particular day to determine for itself whether in fact the opinion that I expressed this morning is the accurate one, that we were misled, or whether Commissioner Adams.... That's a matter for the committee, and I would hope you would agree to look into that matter, Mr. Chairman.

The Chair: Thanks, Mr. Cummins. Of course, no one knows who's going to be where in January and who's going to be doing what, but there is a corporate memory here, in the form of our clerk and in the form of our researcher, and your comments have been noted. Whoever's here will remember that, because I'm sure that, despite our diligence, we'll still be studying this issue in some way or other.

We now go to Monsieur Roy, for five minutes.

[Translation]

Mr. Jean-Yves Roy (Matapédia—Matane, BQ): Thank you, Mr. Chairman.

On page 25, the Auditor General's report states that “key elements to ensure accountability are not present.” A little further on, Mr. Adams, on page 6 of your brief, you say: “This is not easy to do, as it requires many different systems providing information to one central place,” and you say that you hope to have this system in place by spring of next year, that is to say to have sufficient knowledge of the Coast Guard's operation to be able to solve the problem.

What I would like to know is, when the Auditor General's report refers to the absence of “key elements”, which you have addressed, what does that mean, more clearly? And when you tell us that it requires “many different systems providing information to one central place,” to what extent is the Coast Guard so different in the east relative to the west that it is unable to receive information adequately and to manage it properly? That's something I find hard to understand. The Coast Guard system mustn't be so different as that from one ocean to the other.

Á (1145)

[English]

Commr John Adams: If you don't want me to speak to the Auditor General, I won't--obviously they're here--but what he pointed out was that we in fact did have five different approaches to this issue within the coast guard. And you're right, they can't be that different, but in fact in many cases they were very different.

What we're working on now is approaching it from a national perspective, to make absolutely certain that our approach is a national approach and is consistent with sound management practices, and that's the challenge we're facing. We have to somehow bring those five mini coast guards into one, and that is no mean task. It has been that way for quite some time. An autonomy developed within each of the regions that was very difficult to knock down, and that was one of the major findings the Auditor General had. It's approaching the regions to get them to think more nationally, more corporately, and provide the information to the central headquarters, so that we can then establish objectives that can be properly measured in the national sense. That's what the challenge has been. It's taking us some time, but we're hopeful that we'll get there.

[Translation]

Mr. Jean-Yves Roy: Yes, but what are the elements you would like to harmonize? Because, what you're ultimately telling me is that, in view of the differences, we don't have the necessary knowledge to be able to manage the problem properly. That's roughly what you told us. But what are these elements that are so different that they prevent you from obtaining information? When we talk about management of the Coast Guard, I find it hard to understand how managing a ship in the east can be so different from managing a ship in the west, or how managing a fleet in the east can be from managing it in the west. I understand that, when you talk about the central regions, the Maritimes, Ontario or the Great Lakes, that can be different. But what are these key elements that were missing to ensure accountability? What does that mean?

[English]

Commr John Adams: We're going to see if the Auditor General can add some specificity to what the problems were.

[Translation]

Mr. Jean-Yves Roy: Ultimately, what I want is something concrete. I agree with you on your main principles, but what does that mean in concrete terms? What are these concrete key elements that prevented you from managing the Coast Guard?

[English]

The Chair: Mr. Thompson.

Mr. Ron Thompson: Thank you, Mr. Chairman.

Perhaps I could help a little bit on this, and I'll ask my colleague Kevin Potter, who was intimately involved with this chapter, to speak. But before I do that, Mr. Roy, which paragraph are you looking at in the report? You mentioned, I think, page 25, and I didn't find page 25.

[Translation]

Mr. Jean-Yves Roy: On page 25, the report states that “key elements to ensure accountability are not present.” That's in your conclusion. “Failure to ensure that there is one national program” — that's all right, but when you talk about key elements, in concrete terms, that means nothing to me.

[English]

The Chair: Is there a paragraph number, Mr. Roy?

[Translation]

Mr. Jean-Yves Roy: It's in point 2.106, the Conclusion, in the fourth paragraph: “key elements to ensure accountability are not present.”

[English]

Mr. Ron Thompson: You've asked, sir, what the differences are between five coast guards and one national one, and we've looked at that quite carefully in doing the chapter. There indeed were differences, and I wonder if I could impose on my colleague Mr. Potter to talk about at least two of them we've seen in this work, because that's a very good question, and I think it's important to put some facts on the table.

Mr. Kevin Potter (Director, Audit Operations Branch, Office of the Auditor General of Canada): The specific areas we're talking about in this report are national policies not being set up to date with direct regional operations, absence of standards, expectations of levels of service in the work. The headquarters within the departmental management model is responsible for establishing what the responsibilities are to ensure that we meet our national and international obligations in regard to marine navigational support services, and in those areas there were problems. That's what we observed in the particular section you're talking about. So it's not always easy for the regions to understand what it is they are being held to account for and what's expected to be delivered, but also, at the headquarters level, it is difficult for them to determine whether what is actually being provided by the regions meets those national and international obligations.

A specific area would be aids to navigation, the reliability of the aids to navigation. In that particular area there is a standard set and expectations are known, but there wasn't at the time we did the work an ongoing reporting on that to determine whether the standard was being met or not. That is one example of the issues we found.

Á (1150)

Mr. Ron Thompson: Perhaps I might add another one.

In the report we talk about the possibility--and we found an example of this--of duplication of the development of systems. In one particular case--and I forget the paragraph number--there was a system developed on the west coast to do a certain thing, there was another system developed on the east coast to do essentially the same thing, and what worries us is that there are five separate coast guards, rather than one national one. There could be this kind of duplication of effort, and of course wasting of money at the end of the day.

So those were two examples of the kinds of differences we've seen and reported in the chapter.

The Chair: Merci.

Mr. Peschisolido.

Mr. Joe Peschisolido: First of all, I'd like, as my colleagues have done, to thank you for appearing here, gentlemen. It's always very informative and interesting. Let me begin by making a few comments for the commissioner, then asking a few questions.

Commissioner, as you may know, I met with several of your bureaucrats, as well as ministerial staff, in the whole process of the hovercraft purchase. There was a firm from Richmond that I believed had the capacity and a better offer to provide a back-up hovercraft. We had differences of opinion, but I accepted the process. A decision was made to give it to a firm not based in Canada. I thought there were major advantages to having a Canadian-based company, but a decision was made, and we had a legitimate difference of opinion.

Having said that, I would like to ask, Commissioner, if you are confirming today that indeed, the money has been allocated, the $10 million--$6.7 million, plus $3.3 million--for a back-up hovercraft, and will it be arriving at the base in Richmond in the early part of 2004?

Commr John Adams: Yes.

Mr. Joe Peschisolido: Can you elaborate further? When you say the early part of 2004, is this January, February?

Commr John Adams: May.

Mr. Joe Peschisolido: Does that mean the hovercraft will be fully operational when it arrives? Is it arriving in May to be fully operational in August, or is it arriving in February to be fully operational in May?

Commr John Adams: What we originally planned was that it would arrive in February, and we'd finalize the operations in Richmond. It was decided that was not the best way to go. We're going to finalize everything in the U.K. and bring it over. It'll be fully operational in May.

Mr. Joe Peschisolido: Will there be operational tests done by some of your people in Britain?

Commr John Adams: Yes, there will. We'll be part of ensuring that the work is completed to our satisfaction.

Mr. Joe Peschisolido: Could you assure this committee and, more importantly, the Canadian public that the hovercraft that will come to the base in Richmond will meet all the requirements of a fully operational search and rescue vehicle?

Commr John Adams: As a backup vehicle to the CA, yes.

Mr. Joe Peschisolido: How long will that hovercraft be a backup before we begin a procurement process for a new hovercraft for the base?

Commr John Adams: That will obviously depend on the allocation of appropriated funds available for capital renewal, but the minister has made a committment that as soon as is possible, the procurement process to replace the backup with a new hovercraft will begin.

Á (1155)

Mr. Joe Peschisolido: So the minister has made the commitment that the funds, whatever they may be, have been allocated? It's just a question of timing? I just want to be clear here.

Commr John Adams: The timing has not been established at this point.

Mr. Joe Peschisolido: All right.

Let me then go to Mr. Potter. I too would like to delve a little into the five coast guards. I don't think that's necessarily a bad thing. It may be a bad thing when it comes to overall finances and ensuring the efficient running of the department, but we do have five regions, and maybe we have five coast guards because each region is different. I'm not an expert in the Atlantic region, and I've spent some time in Ontario and Quebec, but I know the area around Richmond, with its airport, with the mud flats, in many ways is different from the other parts, and maybe it's a good thing, on the operational side, that we have differences in how the different parts of our coast guard function. I'd like to get a comment, and then I'll leave it till we come back.

The Chair: Mr. Potter.

Mr. Kevin Potter: I think the point is well taken. There is a requirement for flexibility to deal with individual circumstances. Certainly each waterway is different. In the report we talk about the need to assess risks in each particular waterway, and I think the commissioner probably would agree with us that the national standards and policies should incorporate the ability to respond to local needs.

The Chair: Mr. Thompson.

Mr. Ron Thompson: If I could just add to that, as Mr. Potter pointed out a little earlier, the coast guard is looking at serving and meeting a variety of national and international obligations, and in order to do that, it seems to us to stand to reason that you need national standards to work to, and then a national program to put those standards into play. Otherwise, you'll be trying to service an international or national obligation in a fragmented way, maybe not in a consistent way, given the fact that it's Canada that's trying to serve these obligations, not just a particular region. As Mr. Potter points out, though, that's not to say that a national program can't have built into it, and must have built into it, where necessary, differences to deal with different regions. But that's quite a different situation from having five different coast guards, it seems to us.

The Chair: Thank you.

We'll go to the Canadian Alliance, Mr. Cummins, then Mr. Burton.

Mr. John Cummins: I'm going to try again. I understand the coast guard is trying to muzzle its employees. They believe I manipulate the truth, but I'm going to try again.

On June 11--this is another coast guard document, a transcript of a question I asked in the House, and it's regarding the Siyay, the hovercraft currently used in Vancouver--in my question I noted that after a recent trip two and a half tonnes of water were pumped from the vessel. I said, “Mr. Speaker, the corrosion identified in the coast guard report won't stop, it won't reverse itself, the leaks will only get worse”, and I asked what was the minister's plan to deal with it. I got a response that it was just technical problems. I suggested that these are more than technical problems. The engineering report refers to them as serious problems, almost impossible to control.

This is a transcript of question period proceedings, and there's a note on it signed by a gentleman by the name of Sylvain, and he says “Note: John Cummins. Do we need to change our plan?” What does that mean? What's he asking there?

The Chair: Commissioner?

Commr John Adams: I'm sorry, I have no idea what he's asking there. I can't respond to that, Mr. Cummins.

Mr. John Cummins: I've pointed out a very particular problem with the coast guard. An engineering report had been quite adamant that the problem was a serious problem, and the answer I got dismissed that. But this gentleman seems to be saying that maybe there's some substance to that. Is that your take on it?

Commr John Adams: No, because there isn't. The issue you referred to is some two years old, and as I responded fairly lengthily the last time I was before the committee, those matters have been dealt with. Frankly, there is no rust problem on the Siyay, any more than there is on any other vessel working in salt water on a continuous basis. The Siyay is perfectly capable of meeting its operational requirements.

Â (1200)

Mr. John Cummins: If the employees weren't being muzzled, would I get the same answer from them?

Commr John Adams: Mr. Cummins, it was the employees who in fact had the press out. They crawled around and through the Siyay. Obviously, corrosion is a challenge at any time in any vessel that's in salt water. The engineer was there pointing out to them the work they'd done and how they're addressing it and that it isn't and hasn't been a problem.

Mr. John Cummins: That press conference was manipulated by senior management. It was not an employee talking.

The Chair: We weren't there, Mr. Cummins. We don't know about manipulation.

What is your next question?

Mr. John Cummins: You understand the point. It was prepared by senior management. It wasn't one where coast guard employees were expressing their concern in the hope that the situation would be rectified. This was an attempt, if you will, by management to demonstrate that this serious problem had been dealt with. Yet there was no paper trail, which I asked you about the last time. Where's the paper trail to show that this serious problem has been addressed? There is no paper trail. We can't find it. You don't fix a serious corrosion problem on a vessel without a serious paper trail.

The Chair: Question mark?

Mr. John Cummins: Question mark.

The Chair: Any comment, Commissioner?

Commr John Adams: It's a question of what's serious. In the normal manner of addressing issues, whether they're corrosion issues or any other issue, they're corrected through the normal refit process, the normal operation and maintenance process. That goes on on a regular basis. That's exactly what was used to address the corrosion that was evident in the Siyay, as it is in most other vessels that operate in salt water. So it wasn't a serious problem in that sense. That was the opinion of one individual at one time some two or three years ago. That issue has now been resolved in the normal course of addressing concerns being expressed by our people.

Mr. John Cummins: You'll have to demonstrate that with more than just words before I'm going to buy into it.

Commr John Adams: We'll invite you out, Mr. Cummins, any time you want to look at the Siyay, as long as we can work it into the operational cycle.

There was no manipulation. You have to set it up so that you can do it at a certain time, and I think it was interrupted because the Siyay was called out.

The Chair: You have an offer of a date.

Nice to hear from you, Mr. Burton.

Mr. Andy Burton (Skeena, Canadian Alliance): Do you want me to try one?

The Chair: There's no time whatsoever.

Some hon. members: Oh, oh!

The Chair: We're going to Mr. Hearn for five, Mr. Wood for five, Mr. Stoffer for five, Mr. Burton for five, and then Mr. Matthews for five.

Mr. Hearn.

Mr. Loyola Hearn (St. John's West, PC): Thank you very much, Mr. Chair.

Let me thank the gentlemen for coming this morning to address our concerns and hopefully to answer our questions.

In the remarks made by Mr. Thompson, he mentioned the policy decision to maintain staff at certain light stations in 1998. Minister Tobin was there at the time, if I remember correctly. Certainly he was involved in making such statements. However, the department had recognized earlier that it would be feasible to automate most of these light stations, and we've had discussions on that. When you attempted to make a real comparison, you found out that the department had not tracked the cost of operating light stations. What is the status now? Are you planning to throw out the old decision not to automate and to at least go ahead with some, or are you not going to do anything until you can make the proper comparison with the right backup information?

Â (1205)

The Chair: Who is the question addressed to?

Mr. Loyola Hearn: Mr. Thompson made the statement, but if the commissioner wants to answer, I'm easy.

Mr. Ron Thompson: I suggest, Mr. Chairman, that perhaps Mr. Adams would be best equipped to answer that at this point.

Commr John Adams: We're busy now putting together the very things that the Auditor General had highlighted need to be done in a commitment to conclude the review of the light station decision by December of this year. At that time we will be able to complete the kind of analysis the Auditor General was looking for. That will be essential if we're going to make that kind of recommendation. The decision would not be ours, obviously.

Mr. Loyola Hearn: Mr. Chair, I suppose nobody appreciates more than our committee the restraints under which your division operates, the coast guard. We can say the same thing of the Department of Fisheries, and I guess every department could make the same arguments, but we know some of the problems you face.

The results of the issue of heritage lighthouses--and a lot of people are caught up in that--and preserving these not only for safety's sake.... And we can argue whether an automated one is better than having eyes and ears. In some cases there might not be any difference and in some cases it's economically more viable, but I will argue that there are probably places where having the physical presence of the lightkeeper is essential, has made a difference in the past, and could continue to make a difference.

Others have tremendous historical and tourism potential. That is not your problem, and you can answer it that way and you'll be factual. However, is there any coordination or discussion with other departments, such as Canadian Heritage, to look and see? It's all government money, and if you have to pay for it, you shouldn't be charged with the burden of keeping an extra expense you really don't need on your books. I appreciate that. Is there anything going on with other departments that might be able to address the bigger picture of lighthouses?

Commr John Adams: Yes, there certainly is, and not just with other departments but with municipalities, heritage groups, and the provinces. To give you an illustration, in the Maritimes region alone, in the one small province of P.E.I., they've just recently signed an agreement transferring the heritage responsibility for 12 of the light stations on that island to heritage societies and to municipalities. So we're working very diligently in that regard.

Of course, the challenge federal departments face is the same challenge we face, a question of funding. We are working closely with the heritage people here and with the Department of the Environment to see if there isn't some way we could more efficiently deal with the heritage character of our light stations. We now have made a commitment that we will not walk away from the light stations without having made some kind of accommodation to deal with those that have a heritage status.

Mr. Loyola Hearn: In outlining the duties of the coast guard, you talk about protecting the rights of Canadians to navigate our waters and managing a marine pollution program. Just on this, let me throw out two questions.

One, in managing or protecting the rights of Canadians and certainly in relation to our fishery--and we have had this discussion--the coast guard plays an extremely important role. Even though fisheries has the primary responsibility, the coast guard is relied on quite heavily, certainly in the area I represent, Newfoundland. I personally don't think we have the resources. Fisheries certainly doesn't have the resources. I don't think the coast guard has them to do the job that has to be done, and that's why we have so many problems with overfishing and what have you.

One of the other concerns is the oil activity that is growing on our coast. We've just returned from Norway, where we've been told that the Norwegian coast guard--under the department of defence, of course, which probably gives them more clout--basically is very vigilant and is spread out along the coast. In fact, they even have special boats assigned now because of Russian activity bringing oil along the coast. We certainly have some real concerns about the possibilities of disasters in our area.

In relation to the pollution, just some time ago in a court case in Newfoundland.... Well, it didn't get to court. The department backed away because they didn't think the evidence they had of satellite tracking of an oil spill, where a boat was charged because of that, could stand up. I'm sure there's more to it than that. But what's the sense in having such tracking if we can't take the evidence to court? I'd appreciate your comments on that.

Â (1210)

Commr John Adams: Those are always difficult situations. In fact, the decision not to prosecute, obviously, is very much a recommendation from the justice department. The prosecutions are not coast guard responsibility; they're the responsibility of the Ministry of Transport in conjunction with the Ministry of the Environment.

The challenge is always whether you have enough to ensure a conviction, because it's not inexpensive, obviously, to proceed. We have had some success recently in that regard. The other challenge that we have is to convince the courts that the penalties have to be high enough to discourage dumping offshore before coming to port.

Again, I think there is some indication that they are upping the fines, but it's always a challenge to make the connection between the oil that's in the water and the ship. Obviously, if you've seen it dumped, it's easier, but often you don't. You pick it up with an oil slick or what have you. These are challenging times.

However, we have formalized an MOU among ourselves, the environment department, and the Department of Transport to work more closely together to adopt a common approach with respect to attempting to be more vigilant and more effective in our prosecutions. We're hopeful that it's going to work.

With respect to the challenge that exists, we share your concern with respect to a catastrophic problem on our coasts. It's one of the reasons why we've committed to a risk assessment, particularly on the south coast, mostly because of the amount of oil that's moving in Placenta Bay from the platforms. We share your concerns in that regard.

We have, however, quite a good public-private relationship and arrangement with respect to an environmental response to pollution. The challenge that we have is to prevent the pollution before it happens. That's the challenge.

The Chair: Thank you.

For the information of committee members who were not on the trip, on the issue of lighthouses, this question came up in all three of the countries that we visited, Norway, the U.K., and Iceland. I believe, if I remember the evidence correctly, that all of those countries have completely automated lighthouses. My impression was that they looked at us as if we were crazy when we asked them if they had manned lighthouses. It's an interesting thing that I noted.

Mr. Wood.

Mr. Bob Wood (Nipissing, Lib.): Thank you, Mr. Chairman.

Mr. Adams, I'm rather new to this committee. I haven't been here that long, but I was wondering about something. It has been almost four years now since the coast guard launched the Flag II vessel-tracking system. I believe, at the time, in 1999, that it was reported as state-of-the-art equipment. I have a couple of questions about this. First of all, is it still state of the art, or is it quickly becoming state of the ark? And I see on page 11 that you're putting $27.5 million into an automatic identification system. Are they basically the same?

Commr John Adams: No. One is a vessel traffic control system that enables us to control traffic once it reports in. It was, and continues to be, a very good system. We have to continue it. As with anything that's computer-based, you have to continue to improve it and you have to continue to invest in it.

The AIS is essentially a system where the majority of the money will be spent on a ground-based system to receive the information from transmitters that the SOLAS vessels will be carrying. We do not have that capacity now. This is a new system. The other system is a voice system between ship and shore. The AIS is a transponder system.

Mr. Bob Wood: For the new system, are you saying that we are meeting all of the “potentials”? Have we met all of the “potentials”, in your mind, of the Flag II?

Commr John Adams: Yes.

Mr. Bob Wood: Okay.

Commr John Adams: Yes. It's a very good system. We've spread it out. We started it in Quebec and spread it east.

The challenge you heard the Auditor General make reference to is with a second system that was developed on the west coast. Again, it was part of the old five coast guards approach to things. It was the VTOS system.

What we're doing now is moving the INAS system out to the west coast. That will happen over time.

Â (1215)

Mr. Bob Wood: Okay. In 1999 there was a memorandum of understanding reached between U.S. Coast Guard Auxiliary and its Canadian counterpart. Is the MOU still in place?

Commr John Adams: It certainly is. This weekend there's an international search and rescue competition between the two auxiliaries, U.S. and Canada, being hosted in St. John's, Newfoundland.

Mr. Bob Wood: So you're still exchanging different ideas, for instance, on search and rescue, disaster relief, and environmental response?

Commr John Adams: Absolutely. We work very closely between the auxiliaries and between the coast guards themselves. We have a very close working relationship in both respects.

Mr. Bob Wood: I believe the MOU was subject to review and revision every year.

Commr John Adams: It is.

Mr. Bob Wood: And is that going on?

Commr John Adams: Yes, regularly.

Mr. Bob Wood: All right.

The Union of Canadian Transportation Employees started a campaign--I think it was about a year ago, now--saying that SOS actually means “save our services”. The union claims there have been brutal funding and human resource cuts since the coast guard merged with the Department of Fisheries and Oceans. Do you feel there is merit in what the union has claimed?

Commr John Adams: Merit.... There's truth in what they have said. I don't think there's merit in the way they portrayed it. There isn't a government department that went through the nineties that didn't suffer considerable cuts. It was part of program review, and the coast guard was part of it.

The sad part of it is that since the time we in fact were merged with Fisheries and Oceans and left Transport everyone wants to blame somebody else, and in fact what many folks would argue is that the cuts the coast guard suffered were as a result of the merger. One could counter that with saying no, they were the normal program review cuts that all departments, all institutions, suffered during program review.

Were there additional cuts on top of that as a result of the merger? That is the point of contention. I think there were in fact, because you had an institution that left Transport Canada that was a bit more independent and came over to Fisheries and Oceans and we integrated the corporate services support. In so doing, we eliminated overlap and duplication, so there were other reductions in the coast guard. But from a program point of view, on the merger to Fisheries and Oceans from Transport Canada, I don't think it's fair to say that the programs suffered any more than they would have had they stayed in Transport Canada.

Mr. Bob Wood: Mr. Thompson, did you and Mr. Rafuse and Mr. Potter, in your assessment of the coast guard, look at this area at all?

Mr. Ron Thompson: I think as a part of putting the audit work we did do into context, we did look at that. I'll ask Mr. Potter to comment in a little more detail on that, but we did look at the context that surrounded the coast guard, which we actually ended up auditing for the first time.

Mr. Kevin Potter: The period of time the commissioner is talking about predates the actual work we did by several years. As you can appreciate, not all the information was readily available to us in a form that would allow us to do the kind of analysis you're talking about, but certainly what the commissioner has said is true, that there were the cuts in terms of the program review. Then in terms of the allocation of the budgets that would have been in the department when it was with Transport coming over to Fisheries, that's where the difficulties come in, in terms of how much should come over. It wasn't a focus of our audits to determine whether it was a fair amount or not.

Certainly, though, there have been a lot of difficulties in terms of going through a number of different events--the merger, program review, a lot of technological changes affecting the coast guard as well--so there are a lot of things that are impacting on the organization all at one time.

Mr. Bob Wood: Good.

Thank you, Mr. Chairman.

The Chair: Thank you.

Mr. Stoffer.

Mr. Bob Wood: Do I have any time left? No?

The Chair: No, you're way over.

Mr. Bob Wood: I was going to give it to Joe anyway.

The Chair: Mr. Stoffer, go ahead.

Mr. Peter Stoffer: Thank you, Mr. Chairman, and thank you, gentlemen, for appearing today.

Mr. Thompson, my first question is to you. In the six years I've been here, in every one of these audit reports I get from the department I always hear that particular departments say they agree with the findings of the Auditor General and they'll do all they can to ensure his or her findings are met accordingly. This question is from ignorance, but in every one of the reports I get from the Auditor General, there's no deadline that says this department must fix this problem by this particular date; and it leaves it open-ended, which leaves it open to criticism that, yes, we did the report, and yes, we're looking into it.

A classic example is in December 2002 it says “The Coast Guard has recognized this issue and recently started a national review”, but there's no deadline when this will be done. For employees of the MCTS, for example, it is extremely frustrating.

Why doesn't the Auditor General's department put confirmed deadlines whereby departments must meet these recommendations at a certain time?

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Mr. Ron Thompson: Thank you for that question, Mr. Stoffer. It's an important one and really gets at the heart of what we feel we can do as legislative auditors acting for you--and what we can't.

We can recommend action, certainly, and we do a lot, but for us to go that next step and put our own deadline in as to when this action is to be done we think is getting into your territory inappropriately. We can suggest that a deadline be established and that perhaps a committee of the House such as this committee might suggest and recommend a deadline to the department, but that's for you to do, not us, we feel.

Mr. Peter Stoffer: Thank you for that.

Mr. Adams, like Mr. Cummins, I also received from the union a copy of what I would consider the gag order. Had the coast guard ever asked their employees to do this before?

Commr John Adams: Yes. It's not just the coast guard, it's the Department of Fisheries and Oceans.

Mr. Peter Stoffer: I meant the coast guard specifically. When was the last time you asked them to do that?

Commr John Adams: All I've done is reiterated a past practice.

Mr. Peter Stoffer: Because in the six years that I've been here, again, I have not heard anything from the coast guard, either from Mr. Wilson on the east coast or anything else, about asking employees to do this.

Commr John Adams: It's been in operation, as far as I know, certainly since I've been there. All we've done is simply emphasize the importance of employees letting us know what people are asking so that we can obviously help.

Mr. Peter Stoffer: As one who is very concerned about the morale of the coast guard, my suggestion to you is to review this practice, because it just--I hate to use this word, Mr. Chair--really pisses them off when they get this kind of document coming from the coast guard. We know that the Senate committee now is in Nova Scotia reviewing the coast guard, and they don't have very many good things to say about what's going on.

I have a couple of specific questions for you.

In the reports it says that the MCTS centres were reduced from 44 to 22. Is there any plan to further reduce MCTS centres and amalgamate those services in the country?

Commr John Adams: What we're engaged in now in consultation--I might add that in fact the unions are part of that team--is we're looking at the MCTS from a strategic point of view as to how most effectively and cost-efficiently to provide the service that the MCTS is currently providing.

Mr. Peter Stoffer: Overall, sir, with the greatest respect, I think the coast guard's main responsibility is to guard our coast. I would think that if you ask most Canadians on the coast they would say that simply isn't being done. In fact, there's an article in theChronicle-Herald today that says we should just call it the “coast company” instead of the “guard”, because it doesn't appear they're guarding anything.

So I ask you this particular question, and as the commissioner you might know this: how many vessels are patrolling our coastline as we speak?

Commr John Adams: At this very moment I can't tell you that. Certainly any day you want to come over I can give you those kinds of figures.

Mr. Peter Stoffer: The reason I say that is when this committee was last in Newfoundland asking the question, and I asked the person there how many ships they have, he said seven. I said, “How many are patrolling the coasts of Newfoundland and Labrador at this time?” He said, “One.” I said, “Where is it?” He said, “It's in the harbour.”

I've repeated this to you before, and I find that after the trip we just made, Mr. Chairman, to Iceland and to England, and everything else, it appears that those countries take their coast responsibilities a lot more seriously than we do. It's really a shame as a Canadian parliamentarian when you go to these countries and you tell them what's happening on our coastline and you have to duck under the table, because they do a much better job, in my opinion, than we do.

With the recent announcement by Mr. Manley to ask for further reductions from various departments, has the coast guard been asked to pony up any more money from its already starved resources?

Commr John Adams: Not at this time, no.

The Chair: Have you made any recommendations, sir, to the government for additional resources than what was allocated in the last budget?

Commr John Adams: We're formulating those plans now.

Mr. Peter Stoffer: I have a million more questions to ask, but my last one is for the Auditor--

The Chair: Your time is up, but your questions were short and crisp. Maybe we'll get around to you again.

Mr. Peter Stoffer: We need more seats in the House.

The Chair: Mr. Burton.

Mr. Andy Burton: Thank you, Mr. Chair.

As Mr. Hearn raised the issue of coastal lighthouse manning, I want to reiterate that it is an issue on the west coast in terms of weather reporting and safety for aviation--for the coastal float plane operators--and it's something we hear is basically gone. And NavCan is not being particularly forthcoming, so there's a real gap there from a safety issue. You might want to keep that in mind.

As you know, this committee is currently studying the coast guard. And as another comment or aside, we were recently at Lee-On-The-Solent in southern England, and maybe you could have saved some money for the coast guard. There's a number of fairly large hovercraft mothballed in their yard there, so perhaps you should check that out. I'm sure Mr. Wood will back me up on that. They don't use them. Anyway, that's an aside.

Mr. Adams, we've heard a fair bit of talk about programs and service levels, reviewing and so on. Because we're currently studying the coast guard and looking at possibly making recommendations of how we might improve it, what other coast guard management systems have been examined or considered at this point in time in order by you and your people to improve our coast guard?

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Commr John Adams: We're trying to leave no stone unturned with respect to looking at how we're delivering each and every one of our programs, with a view to trying to be more cost-effective. When we initiated this, we called it a coast guard modernization plan, but it has now been rolled up into the departmental assessment and alignment project. It's a look to make absolutely certain that we're doing the right things and that our resources are allocated in the right way. So we're looking at everything and anything.

Mr. Andy Burton: When you say everything and anything, what other systems have you looked at? Can you name some? Have you looked at the Norwegian system, the British system, the Icelandic system?

Commr John Adams: Oh, I'm sorry...you meant other approaches.

Mr. Andy Burton: Have you considered other countries' modes of operations?

Commr John Adams: Yes. The challenge you have is that there's no one system comparable to ours, as you've heard from a number of people recently. I think somebody made reference to the Chronicle-Herald on the east coast and the comparison with the U.S. Coast Guard. We do compare in some respects, but not in other respects.

We work as part of the International Maritime Organization, and as part of the the International Association of Navigational Aids and Lighthouse Authorities, IALA, which is part of the UN. So, yes, we're constantly working with all international nations to compare like systems with like systems, to make certain that we are comparable, or that we are adopting best practices to the extent we can.

Mr. Andy Burton: So at this stage of the game, what has actually taken place at the operational level to initiate some of the changes that we're hearing need to be made?

Commr John Adams: I made reference to some of them. In modernizing our navigation systems, for example, we're looking to exploit technology in order to use lighter materials that would be easier to handle with respect to our buoys. We're looking to maximize the utilization of technologies that are now onboard the ships, to reduce the number of buoys we have in the water. We're looking to continue to improve our relationship with the private sector with respect to responding to pollution. We're looking at life-cycle material management systems, to be certain that we are better managing the systems that we have in place, from the point of view of operations and maintenance—and, obviously, eventually at divestiture and new procurement. All of those....

We're comparing what we're doing with what other countries are doing.

Mr. Andy Burton: As an example, we were recently in England and Norway. Their coast guard systems have gone into the practice of leasing vessels. They actually design and spec-out vessels and lease them. Have you considered that?

Commr John Adams: Yes, we'll have to look at that as one of the options in our recapitalization program. In some cases, where we cannot meet the demand that our client is placing on us, we have leased—as recently as last year in British Columbia, for example.

Mr. Andy Burton: Again, looking at some other countries' systems, do you feel that the Ministry of Fisheries in Canada is the appropriate ministry to be handling the coast guard? For instance, Iceland is fairly militaristic and has it under their navy; in England, it's under the navy; and in Norway it's a mix as well. What's your comment or feeling as to the possible direction we should go in terms of whether it should it be under a different ministry? Is DFO the appropriate ministry?

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Commr John Adams: Frankly, from my point of view, DFO is as good as any other ministry.

Our challenge is a resource challenge. It's not where we are, but it's how we're resourced.

Mr. Andy Burton: When you say it's as good as any other ministry, then how good is any other ministry?

Commr John Adams: There are arguments on many sides. The argument for being in Fisheries and Oceans is that there is one minister responsible for oceans and that we complement that minister in what we do on oceans. The legislative basis for what we do is in the Oceans Act, which the Minister of Fisheries and Oceans is responsible for.

Two of our largest clients are the fisheries management and science branches. We're collocated with fisheries management and science, so you get that interaction, which is very effective with respect to meeting their demands.

On the other hand, you could argue, “Are you not transportation?” Yes, we deal with the transportation sector. Would it not be more sensible to be in the Department of Transport? You could make the argument, yes, that it would be one place for us to go, but then we're distant from Fisheries and Oceans. Previously, when we were in Transport, Fisheries and Oceans had to have their own fleet. In fact, they had two fleets; they had the science fleet and the fish management fleet, or the conservation and protection fleet. Now we've amalgamated into one fleet, so you get the economic advantages of one fleet versus three fleets.

So you can make arguments. Other people would argue back to the point about guarding, that we might be more effective if we worked with National Defence with respect to guarding the coasts. Yes, if we had a mandate to guard the coasts, it would be true; but at this point in time, we don't. We're a safety and environmental response organization.

So for where we should be, you could make arguments on many sides; but wherever we are, we need to be properly resourced. That's our challenge. That's what our minister is very much hoping for.

The Chair: Thank you.

We now go to Mr. Matthews.

Mr. Bill Matthews (Burin—St. George's, Lib.): Thank you very much, Mr. Chairman.

To follow up, Mr. Adams, on Mr. Hearn's comments on light stations and so on, what's happened to the employees where you've automated? Have they been accommodated in some way? My understanding is they have been.

Commr John Adams: Yes. In fact, our commitment to all our employees is that we will accommodate them to the maximum extent possible. You can never say you will not make anyone surplus, but we always aim to accommodate our employees. Light stations are peculiarly challenging, because those employees are not really mobile, so it's always very difficult to accommodate them. The way we often deal with situations like that is through attrition. We just wait until it's time for them to leave, and then we don't replace them.

Mr. Bill Matthews: So right now are most of them employed in some way with authorities that have taken over the light stations for tourism and cultural purposes?

Commr John Adams: No.

Mr. Bill Matthews: What's happening?

Commr John Adams: The vast majority have either left completely or have been absorbed into other parts of the department.

Mr. Bill Matthews: On page 2 of your document you talked about staff presently involved in review and delivery of issues and services. Then you went on about upgrading delivery of marine communications and traffic services. I think that ties into someone else's question about the MCTS and stations. If my memory serves me correctly, there are five MCTS centres in Newfoundland and Labrador. This says there's going to be an upgrade in delivery. In your review in Newfoundland and Labrador, are you looking at shutting down any of those centres, or are you going to upgrade them?

Commr John Adams: What we're looking at doing is determining the most cost-effective way to deliver the service. That may include reducing the number of sites, but we'd have to augment the sites that remain. So it could go both ways: fewer sites, but increased capacity in the sites that remain. Those are all hypothetical at this stage. No decisions have been made, and we continue to review our options in conjunction with the unions.

Mr. Bill Matthews: Going back to the committee's work on MCTS, if my memory serves me correctly, there were commentaries on a number of Newfoundland sites, and one was in Port Aux Basques, which is in the riding of Burin--St. George's, which I represent. That services the gulf region. I think the comment on that site was that the radar that's currently there can't service the full width of the gulf, and I think there was a recommendation that you look at putting a radar service there that would service the gulf, because of the potential vessels entering that zone undetected. Do you have any plans to upgrade the Port Aux Basques site, or are you looking at shutting it down?

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Commr John Adams: We're looking at all options, Mr. Matthews, and whatever is left will be upgraded to meet the requirement that needs to be met with respect to safe waterways.

Mr. Bill Matthews: Isn't that reassuring?

Thank you. That's it, Mr. Chairman.

The Chair: Thank you.

Mr. Cummins.

Mr. John Cummins: Thank you, Mr. Chairman.

Mr. Adams, is it true that the coast guard intends to close light stations in December, when Parliament is in recess?

Commr John Adams: No.

Mr. John Cummins: You're not closing light stations in December? It's not in the plans?

Commr John Adams: No.

Mr. John Cummins: You did mention that you have some authority under the Oceans Act and so on, and you've certainly got authority under the Canadian Shipping Act. Essentially, that means the coast guard does have some obligations in security, and I understand you're working with DND now in an attempt to improve the situation, with some cooperation, long-range radar, and this long-range AIS. Is that correct?

Commr John Adams: It's not so much DND as interdepartmental. We're working with Transport, all departments involved in security. There are a number of improvements we're making with respect to surveillance and intelligence. We'll give them information, and they'll make it intelligence. In other words, we're working to establish data fusion centres on both coasts. AIS is one part of that data gathering or surveillance capability. That's part of a bigger system that National Defence runs out of the data fusion centres in Victoria and Halifax. They are working on the over-the-horizon or wave-top radar, which will improve the radar coverage on the coast, but that's their project as part of an interdepartmental initiative towards improved security on the coasts.

Mr. John Cummins: Well, my understanding is that in spite of what you've said--and I don't question it--much of what's been done to date is going to accomplish little for national security. I'm under the impression that the HF radar and the long-range AIS comprise an incomplete system. It's great at monitoring vessels that aren't in Canadian waters, but these vessels will disappear as soon as they get within 20 to 40 miles of the coast. That means vessels will still be able to enter Canadian territorial waters without any surveillance or challenge from Canadian authorities. Is that a correct assessment?

Commr John Adams: That's way out of my area. I'm not into that kind of detail.

Could I, Mr. Chair, take that under advisement and see if I can get you a written response with respect to where that radar cuts off and where other radar picks up? Frankly, that's pretty technical and beyond me.

Mr. John Cummins: I appreciate that.

The Chair: That's fine.

Mr. John Cummins: I'd appreciate that.

Commr John Adams: I'll certainly do that.

Mr. John Cummins: Thank you.

One of the problems MCTS has is that it appears that the bulk of their budget.... This committee did a study on the MCTS and were quite concerned about the operation and about the stresses that were put on the personnel. And with this issue we were just talking about, the long-range radar and this AIS, it seems that there's going to be even more demand on the MCTS officers. All that being said, the speculation within the department concerns what they refer to as the usual fall wall, meaning the department will run out of money and they'll have to stop their travel, their training, and so on. Is that the way it is again?

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Commr John Adams: I hope not, Mr. Cummins. We've been working very hard to ensure that it doesn't happen. In fact, we took your observations and conclusions and recommendations on the MCTS situation, particularly on the west coast. We have committed ourselves to increase the ab initio training for MCTSOs and to increase the staffing level, so that we don't burden those who are left to the extent that we have in the past.

We're doing our level best to make absolutely certain that the fall wall--I've heard it referred to as that as well--or the curtain doesn't come down again this year. We're hopeful that we've got sufficient allocation that it won't happen, but I would be less than truthful if I didn't say we have some real challenges with respect to finances on the west coast, and we're working very hard to address them. That's all part of the rationale behind the departmental assessment and alignment project. We're looking at where we can find resources to realign them, so that we can avoid the sorts of situations that were highlighted to you when you visited the MCTS sites on the west coast.

The Chair: We've got twenty minutes left. We have three questioners, and I have a couple of questions, so I'm going to be real tight on time.

Mr. Hearn.

Mr. Loyola Hearn: Thank you, Mr. Chair. I'll also try to be brief and save some time for the others.

In relation to staffing, one of the complaints we get quite often with the coast guard is that you can be working there for years and years and have no tenure or seniority; you're still just shoved in here and there whenever you're needed. In order to get a good crew, in order to have stability, in order to have morale, more importantly, isn't there a better way of handling things?

Commr John Adams: There certainly is. We've taken the first step in that regard by converting all our long-term terms, any terms over three years, into indeterminate employees. That was a good step. The second step we have to take--and we're working on it, but again, it's a question of finding the finances to do it--is to establish pools. If I'm sick one day, my office sits empty; somebody else can answer the phone that day, but you can't sail if you haven't got the requisite crew. So what you need is a pool of people to deal with people who are off on training, people who call in sick, etc. What we're trying to do is establish a pool that would have legitimacy. It would be indeterminate employees, who would be available to fill in when you needed them on the crews.

The way we've been doing it up until now is with terms and casuals. I agree, that is not an approach we're particularly pleased with. We've taken the first step, we've done away with long-term terms. It's not fair to them, nor is it fair to the crews. But we haven't managed to get to the second step, which is that pool of indeterminate employees we would use to backfill legitimate vacancies in the crews. We're working on it.

Mr. Loyola Hearn: That's fair ball.

Let me just throw two more at you, and that's it. One is in relation to the auxilliary coast guard. I think it's playing, certainly in my area and I'm sure everywhere, an extremely important role. One of the concerns that was raised last year was about funding to keep that going, because more and more demands are being put on them. Our fishermen are being forced farther and farther from shore in smaller boats, as you know, and all of that leads to problems. Can that operation be sustained, and is it beneficial? Can we make sure it's in place, and is it of assistance to you?

The other one is in relation to your capital costs. Of course, the big costs are for boat replacement and repair. In Norway--and I've raised this before, maybe with the minister, maybe with you, I'm not sure--leasing is a big issue. When I raised it, the answer basically was, yes, but we have so many specific needs, you just can't go out and lease the type of boat we want. However, your boats, as you know, do a lot of different things, from going out rescuing a small boat when some idiot goes out when it's rough, to oil spills, fishery observations, you name it.

In Norway they charter for short terms, maybe five years or ten years, depending on their needs, looking ahead to specific needs, smaller fishing boats, really, converted boats, trawlers, with adequate equipment, but to do specific jobs. They even have research vessels to do a specific job. It seems they can better spread their money. It's almost like leasing a car: in the long term, you could say, it doesn't make a lot of sense, but you always have a new car and you don't have a lot of costs, and you have what you want.

Is there any thought about doing something like that? Have you had any proposals from people who have offered to do those things for you?

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Commr John Adams: The answer to both of those is yes. We are looking very hard at that option, and we'll have to explore it when we move forward with our requests for additional capital. What we've got to make absolutely certain is that it's more cost-effective, that's the big point.

With respect to the auxilliary, just last year the minister did sign a new five-year agreement with the auxilliary for a total of $4.5 million a year--$21 million, I think it worked out to. Could we do more with the auxilliary? That's an interesting point. Are we getting good value for that dollar? Are we ever. They're terrific on both coasts and in the centre of the country. You can only push volunteers so far, so there is a limit, but they are serving us very well, and we will continue to support them. I will be in Newfoundland this weekend to be with them as they're competing with the Americans. They're a tremendous group of people, who do certainly use the dollars we give them tremendously to our benefit.

The Chair: Thank you.

We'll be hearing from the auxilliary. They're going to be witnesses. We heard in the U.K. about the tremendous volunteer organizations that help the U.K. coast guard; they've clearly acknowledged that without them, it would be impossible to do the job.

Mr. Peschisolido.

Mr. Joe Peschisolido: Thank you, Mr. Chair.

Commissioner, the third or fourth week in August I toured the sea base in Richmond. Also, we went on the Siyay and had the opportunity to discuss the status of the Siyay with the officer in charge and the engineers. Is it your understanding that their assessment is correct, that the Siyay is completely functional, and other than the usual wear and tear that occurs in any hovercraft and the periodic maintenance that was done on the Siyay, the Siyay is a first-line functioning search and rescue vehicle and will meet the needs for the next five to seven years?

Commr John Adams: Yes.

Mr. Joe Peschisolido: Okay.

Also, while I was on the base, I had the opportunity to speak with the second dive team the officer in charge has put together. As you know, we've had a bit of controversy on the coast after the tragic Cap Rouge incident and different variations on whether or not dives could occur. Is it your understanding that as of October 10, with the graduation of the second dive team of six, on the west coast the two teams will now have the capacity, if after assessing a scene they believe they can do penetration dives?

Commr John Adams: They will have the capacity, but not yet for 24/7. We need additional divers to come into the system. But yes, they will have that capacity.

Mr. Joe Peschisolido: And when will that occur, Commissioner?

Commr John Adams: I'm not certain, but I think it's the end of November, this fall. I can get back to you on this.

Mr. Joe Peschisolido: Very good.

The Chair: Sorry, end of November for 24/7...?

Commr John Adams: Yes, 24/7, dive under all circumstances.

But I'll get that date to you, for sure.

Mr. Joe Peschisolido: All right.

Third, Commissioner, I share the concerns of my colleagues Mr. Cummins and Mr. Stoffer on the form that your officials or officers or workers have to fill out if a member of Parliament or staff member contacts them. I have in front of me an e-mail that was sent to Mr. Stoffer's office. I want to go over again the questions that were asked, just for my own sake.

Is it accurate that if, for instance, I called the sea base in Richmond and requested to go in, to have a conversation with the officer in charge or with a diver, they would have to fill out a form, submit it, and say what was discussed?

Commr John Adams: Yes.

Mr. Joe Peschisolido: When was that implemented?

Commr John Adams: As I said, it's been there since I've been there. I'll have to get some details on that and let you know.

Mr. Joe Peschisolido: What would be the rationale for that?

Commr John Adams: The rationale, basically, is that we and the minister know what is currently being talked about, and we can prepare ourselves to either complement or supplement the information, or prepare the minister to prepare himself for “Whoops, this could come up in the House”, or “This could come in a media scrum”. So it's the two aspects, both ends.

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Mr. Joe Peschisolido: Okay.

Do I have time for one more point?

The Chair: Yes.

Mr. Joe Peschisolido: I just want to follow up on the national standards, because I think this is a point that should be explored. First, there are the national standards for the financial aspect of it. And I would agree with all of the speakers that we have just one coast guard, but we do have different regions.

In talking about national standards, can you elaborate a little bit, Mr. Thompson or Mr. Potter, on what that would entail--if you can indulge me with my particular interest on the west coast and Richmond--or on how that would impact on the hovercraft and the search and rescue plans that would have the airport, mud flats, and hovercraft...?

Or that's probably for Mr. Adams.

Commr John Adams: It wouldn't have an impact. Just as was said, we have to make certain that we have a level of service, a level of response that's consistently applied. Now, mud flats are much different from open water, so we'd have to tailor our response to ensure that the level of service can meet the peculiarities of that situation.

So that's the very point that was made--a national standard, but implemented in accordance with the specifics of each region, obviously, for the best of both worlds. Of course, we have to be certain that there is a national level of service and that we're consistently meeting it, not more in one and less in another.

Mr. Joe Peschisolido: Thank you, Mr. Chairman.

The Chair: Mr. Stoffer.

Mr. Peter Stoffer: Thank you, Mr. Chairman.

The Chair: You're the final questioner, other than me.

Mr. Peter Stoffer: Okay.

Help me out here. Maybe I'm just ignorant, or maybe I come from a different world, but to me, when I was growing up, the coast guard meant we guard the coasts. Is it your mandate, sir, to guard the coasts, yes or no?

Commr John Adams: No.

Mr. Peter Stoffer: Okay. So that changes that opinion I had of the coast guard.

How many people work for the coast guard in the DFO building here at 200 Kent Street in Ottawa?

Commr John Adams: In round figures, 400.

Mr. Peter Stoffer: Now, this is the part that really frustrates me.

To Mr. Thompson and Mr. Rafuse, kick in, if you like.

This is a report of the Auditor General from December 2000. To follow up on what I said earlier, this is a quote from the Department of Fisheries and Oceans' overall response--

The Chair: Can you give us the reference?

Mr. Peter Stoffer: Sorry, it's in the conclusion, 31.139. It says here:

Fisheries and Oceans' overall response: Fisheries and Oceans accepts the Auditor General's findings, and is committed to finding solutions to the shortcomings.

Now we move ahead two years. Go to page 23 of the December 2002 report. It's a full two years later. It's on page 23, 2.108. It says:

We are concerned that the Department has not responded to issues that have been confronting the organization for many years.

Call me simple, call me stupid if you like, but there are 400 people working for the coast guard at 200 Kent Street. Right here, it says that we're going to do something. Over here, it says that it hasn't been done yet. Why has it been so long?

You want to know why members of Parliament and taxpayers, who pay very good money to operate these departments, are very frustrated at what they see as a Neanderthal, dinosaur approach to moving on issues? It's why the Auditor General said we don't put deadlines on it, but I think we should.

On accountability, if you can't get it done, my own opinion is that there is value for the taxpayer and value for the industry, the fishermen, and for all kinds of things. We have three huge coastlines here. Iceland does a hell of a lot better job than we do. We have a huge economy with a tremendous GDP. We can't even do something like answering a report in a reasonable time.

Auditor General, you must be extremely frustrated when you have these delays. It's not only this department, it's others.

Mr. Adams, it's not against you personally. You're doing the best job you can with the resources you have, but something has to change and speed has to be invoked on this. There are 400 people working at the coast guard, and two years later we still have the same problems. What is going on?

I know that's a bit of a rant, but it frustrates me to no end when I deal with officials, union people, and very good workers in Nova Scotia and Newfoundland. They bang their heads at this so-called Neanderthal approach at DFO and the coast guard. Nothing is getting changed, in their perception.

Prove me wrong, please.

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Commr John Adams: I tried to outline a number of things we're doing. I would gladly offer, once again, to have the committee over to talk and meet with our people to see what we're doing. I think we are doing a great deal.

You're comparing the 2000 report to the 2002 report. The 2000 report was on fleet management. The 2002 report was on marine programs. They are two different reports. Frankly, they didn't come back to look at the fleet management work. They're going to do that.

When you talk about time, we did put an action plan together. We did submit it to Parliament on the FMRI, the fleet management renewal initiative. As I've said, we're committed to give an action plan to Parliament with respect to 2002. It will have timelines, and the Auditor General will be back to review what we're doing.

I really do think we are doing a lot. I would love for you to come over and get a briefing from, for example, my project manager for MCTS on the work we're doing there. He's doing a lot of work on it. We're continuing to move forward, conscious, obviously, of the impact it's going to have on people and conscious, obviously, of the impact it's going to have on federalism. In many cases, we are the only people in some of the small towns and villages in this country. That has to be factored in. It's not simple.

Frankly, I think we are moving the yardstick. I think that some of what I've given to you today is an indication of that. I'm prepared to entertain one, two, or any number of you, to give you more details on what we're doing.

The Chair: Thank you very much.

Mr. Bob Wood: Excuse me, Mr. Chairman.

The Chair: Yes, sorry.

Mr. Thompson

Mr. Ron Thompson: Thank you, Mr. Chairman.

This might be a time when I could make a comment I was going to make at the end of the hearing. It relates to what Mr. Stoffer raised, if you could give me just a moment to make it.

We're looking at two audits here that we've done in the last several years. It's good to us that we seem to have identified issues that are of interest and relevance to members of Parliament. That's important to us. Some times you hit good issues and other times perhaps issues that don't resonate as well with members of Parliament, but these two have. We also seem to have found a situation where the department we've audited has said “Yes, we recognize the issues; we know about them and we want to fix them too.” That doesn't always happen either, but it has happened here.

But all of that doesn't get anything done, in my experience—and I've been with this office for 26 years—unless members of Parliament take an interest in the issues and say “we want some change”.

I think here we don't only have one, but we have two parliamentary committees reviewing these sets of issues and encouraging and holding people to account—ourselves as well as Mr. Adams and his colleagues—to make some changes. That to me is a good thing. I think it probably takes time to make some of these changes. They're not small things that we've been suggesting be done, but I think the process is working from where I sit.

One thing I would leave you with is that we are going to come back to re-audit these two chapters. We're going to report the results of that in what we call a status report—a new product of our office that we've been putting out now for the last two years—in about January or February of 2007. So at some point we'll come back together to see in an audit sense what's been done. You talk about deadlines, Mr. Stoffer, but my hope is that when we get together in January or February of 2007, quite frankly we can tie a bow around a lot of this stuff. We'll see some very significant change that has been made, thanks in large measure to the interest of parliamentary committees such as this.

Thank you, Mr. Chairman.

The Chair: Thank you, Mr. Thompson.

Indeed, that ties in perfectly with what I was going to say, because I was going to make a couple of suggestions based on what we've heard today, first to the Auditor General. Your work is fantastic, and the detail that's in here is just wonderful. The problem is that we as parliamentarians are absolutely swamped with wonderful reports, and not only wonderful reports in general, but wonderful reports from the Auditor General.

I wanted to offer the suggestion to the Auditor General that a more proactive approach be taken with respect to parliamentarians, as follows: that when you issue a report such as this—and although I'm referring to the 2002 report, I mean any report, but let's take fisheries—that deals with fisheries, you not only submit it to the House of Commons and to the Speaker, but write a letter to the chairman of the committee asking for an opportunity to appear to discuss your findings.

Now, you may never get to the committee because the committee may be too busy, but what will happen is that this letter will be given to the chairman and will be discussed by the steering committee, which contains opposition members who will have their own agendas and government members who will have their own concerns of their own regions, and it may very well be that you would then be given the opportunity to make a presentation to the committee about your findings. If you do such a thing, it gives you the opportunity.... You're here a lot longer than most members of Parliament. You said you've been doing this 24 years, I believe.

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Mr. Ron Thompson: It's 26 years.

The Chair: You'd be hard-pressed to find members of Parliament on the fisheries committee who've been doing it for 24 years.

My point is that you could then return here and say, as you did in your material, “I was here on the issue of safe and efficient marine navigation in September 2003, and this is roughly what we said. Now we've done the follow-up, and I'm pleased to report that the department has done everything it needed to do”--or whatever your point is.

So I'd suggest that you take that to the Auditor General and that this become a matter of course to try to engage parliamentarians who see these things. Some read them, some don't. The committees are tremendously busy. We may never have time to call you, but it would be an impetus for us to at least be forced to consider whether or not to call you on a particular issue.

So that's just some free advice.

Commissioner, more free advice. I haven't even seen the memo about what you're asking your staff to do, but just based on the questions by the three parliamentarians, I would urge you at the very least to reword it and to make it clear that there is no prohibition on speaking to parliamentarians and there is nothing wrong with speaking to parliamentarians. The purpose of any report would be to ensure that the minister is aware of the interests of the parliamentarians for obvious political reasons, including question period. We can all understand that makes sense. But to leave any kind of impression that your employees should not be speaking to parliamentarians is totally inappropriate. I'm sure it isn't your intent, but even if that's the impression of one employee, that's one impression too many. I would ask you to inquire privately--I'm not going to ask you the question now--as to whether this is in fact the practice in all departments.

I want to address a question to the representatives of the Auditor General's department on point 9. We're going to be hearing from the shipping industry. You say, “Marine services fees have encouraged industry to become more involved in determining the service levels it needs. However, some in the industry still believe that the fees are too high for the services the Department provides.” Does the Auditor General have any opinion on that opinion?

Mr. Ron Thompson: There's an easy answer to that question, I'm afraid, Mr. Chairman. The answer is no, we don't. That's really a matter of policy. What the three levels are is something we wouldn't comment on. Certainly, though, when you start to charge fees for a service, it does sharpen the mind in terms of what you're getting for the money you're paying, and that's the point we're making here.

The Chair: Our time is up.

Mr. Cummins.

Mr. John Cummins: Just very quickly, Mr. Chairman, on that document, the member of Parliament inquiry form, I think it's totally inappropriate that the form even be in existence and for the coast guard to be acting, if you will, as spies for the minister. As an extension of that, Mr. Chairman, I would view it as a violation of my rights as a parliamentarian if a member of the coast guard, who may or may not be a constituent, were to approach me on a matter of concern and to be required to report that elsewhere. It's an issue I intend to take up with the Speaker.

The Chair: I was going to say that would be the perfect place to take it up.

Mr. John Cummins: I intend to do that.

The Chair: That's why I wanted to give a heads-up. If it's a departmental policy across the government, then that needs to be known in terms of submissions that are made by all parliamentarians, and also the wording thereof.

Mr. John Cummins: Yes.

The Chair: Let's leave it at that.

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Mr. John Cummins: I just want to say to the gentlemen from the Office of the Auditor General that my ignoring you today should not be taken as a reflection on your work. I do appreciate it, and I commend you for it. I hope that at some point we will have the opportunity to discuss it further.

Thank you.

The Chair: Thank you all, gentlemen, for coming and for answering our questions.

We're adjourned.