RNNR Committee Meeting

    Ladies and gentlemen of the committee, we can begin.

    Welcome.

    Madam Gélinas and your colleagues, welcome.

    This is meeting number 15 of the Standing Committee on Natural Resources. Pursuant to Standing Order 108(2), we are studying the 2006 report of the Commissioner of the Environment and Sustainable Development.

    Witnesses before the committee today are from the Office of the Auditor General of Canada: Madam Johanne Gélinas, Commissioner of the Environment and Sustainable Development; Mr. Neil Maxwell, principal; Mr. Richard Arseneault, principal; David McBain, director in the division; and Kim Leach, director in the division.

    We welcome all of you.

    Pursuant now to Mr. Cullen, who has distributed a notice of motion, members, before we go on, Mr. Cullen has indicated he will do this very briefly. Do I have consensus with the committee, before we have Ms. Gélinas, to allow Mr. Cullen to briefly introduce his notice of motion?

    Some hon. members: Agreed.

    The Vice-Chair (Mr. Alan Tonks): Okay.

    Mr. Cullen, very briefly, please.

    Thank you, Mr. Chairman.

    I just want to say that I am giving notice of two motions, one having to do with the EnerGuide program and one having to do with the wind power production incentive programs. I'm tabling them today but giving notice of these motions so that we can hopefully discuss when we come back after the recess.

    Thank you.

    Thank you, Mr. Cullen.

    Members of the committee are aware that Mr. Richardson, the chair, is not able to be here today, so I will endeavour to do my best, with the support of the clerk and the assistance of all of the members of the committee, to deal expeditiously with the agenda.

    Having said that, Ms. Gélinas, you have the floor, and we look forward to your opening statement.

    Thank you.

    Thank you very much, Mr. Chair.

    Members of Parliament, I'm pleased to present to you this afternoon my sixth report as Commissioner of the Environment and Sustainable Development.

    This report deals mostly with the federal government's approach to climate change covering up to mid-June 2006.

    In the course of our audit work, we have tried to answer three basic questions: Is Canada on track to meet its emission reduction obligations? Is Canada ready to adapt to the impact of climate change? Is the government organized and managing well?

    The answer is no to all three questions.

    It has become more and more obvious that Canada cannot meet its Kyoto Protocol commitments to reduce greenhouse gases. In fact, instead of decreasing, greenhouse gas emissions in Canada have increased by 27% since 1990.

    Let me walk you through each of the five chapters of my report.

    Chapter 1 addresses how the federal government is organized to manage its climate change activities, whether it is able to report the costs and the results of its efforts, and on what basis it developed key targets for reductions in greenhouse gas emissions.

    It also addresses new tools the government has chosen to help achieve its climate change objectives--a domestic system of trading greenhouse gas emissions, and Sustainable Development Technology Canada, a foundation set up to help reduce greenhouse gas through technological innovation.

    Government action has not been well organized or well managed. The government has not defined its leadership role, nor has it identified the responsibilities of each department. It has been unable to come up with the basic tools it needs to measure its progress. Even though more than $6 billion of funding has been announced since 1997, the government still has no system to track the spending and results of its climate change activities. In other words, the government has no way to report returns on its investment.

    Another major problem with the government's approach is its failure to address the biggest greenhouse gas emitters--transportation and heavy industry, which together represent the lion's share of all emissions in Canada.

    In the transportation sector, which produces 25% of all gas emissions, the only well-defined measure in place is a voluntary agreement with the car industry to reduce emissions by 5.3 million tonnes by 2010, which is only 2% of the overall reduction needed to meet Kyoto's commitment. In addition, we found the agreement falls short in a few key areas for voluntary agreements--mainly, the lack of a third-party independent verification of the model, data, and results that will be used to determine progress.

    As for the industry sector, which is responsible for 53% of all emissions, the government has steadily, since 2002, lowered greenhouse gas reduction targets. The reduction now expected from that sector could be only 30 million tonnes, of a total of the expected 270 million tonnes of reductions needed to meet Kyoto's commitments.

    In other words, according to the data we collected during this year's audit, the two sectors responsible for 78% of all Canada's emissions could contribute only around 20% of the expected emission reductions. Even if the proposed measures are implemented, they will only, at best, slow down the growth in greenhouse gas emissions, not reduce them.

    The two principal tools for reducing emissions--the system of large final emitters and the national emissions trading system--are still under construction, after more than four years.

    Chapter 2 deals with adaptation. Unfortunately, we found that adaptation is where the efforts of the government were especially disappointing. Despite commitments to take action going back to 1992, there is no federal strategy to specify how the effects of a change in climate would be managed.

    The failure to make significant progress on adaptation efforts risks Canadian social and economic well-being.

    Chapter 3 looks at three Natural Resources Canada programs that each received $100 million or more to reduce greenhouse gases emitted during energy production and consumption: the wind power production incentive for renewable energy, better known by the acronym WPPI; the EnerGuide for existing buildings for energy efficiency, abolished in May 2006; and the ethanol expansion program for renewable fuels. We found that while these programs yielded results, it was difficult to assess whether they reduced emissions as planned because their targets were unclear. There was also limited reporting of the results these programs achieved with the money spent. We expected Natural Resources Canada to tell Canadians how successful the programs were at reducing greenhouse gases, but with unclear targets and inconsistent public reporting, we wonder how parliamentarians could assess whether these programs are working.

    Chapter 3 also looked at the federal efforts to tackle emissions produced by the oil and gas industry. We found that in its battle with climate change the federal government has not taken into account the unprecedented boom in that sector. Emissions resulting from the increased exploitation of oil sands could double by 2015, cancelling any other efforts to reduce greenhouse gases.

    Chapter 4 concerns sustainable development strategies. Our findings this year represent good news, to a degree. In three quarters of the cases we examined, departments are making satisfactory progress on their strategy commitments.

    Chapter 5 contains two parts: the annual report on petitions, and the results of an audit we conducted on a commitment made by Natural Resources Canada, Environment Canada, and Public Works to purchase 20% of their power from green sources by 2006.

    It is interesting to note that increasingly Canadians are raising the issues of climate change and air quality in environmental petitions. Canadians are informed and concerned about climate change.

    Most responses addressed questions raised. Some did not. An example of a response that did not address the questions posed is that of Finance Canada to petition 158, concerning subsidies to the oil and gas industry and federal efforts to address climate change. Your committee may wish to get Finance Canada to clearly explain the extent to which the sector is subsidized.

    We found that the government has not been able to deliver on its commitment to buy 20% of its power from green sources by 2006, as it stated it would do in a response to a petition in 2002. As a result, it has not met its expected contribution to greenhouse gas emissions reductions in Canada.

    At the end of our audit, my conclusion is this: the federal government has done too little and acted too slowly on Canada's commitments to address the challenge of climate change. Looking forward, a massive scale-up of effort is needed.

    I have identified five areas that I believe are crucial: provide sustained leadership; integrate energy and climate change; develop a plan to reduce greenhouse gas emissions; push ahead with adaptation; and, assure governance and accountability.

    Each area is important, but the call for leadership by the federal government applies to them all.

    I believe that there is an important opportunity for parliamentarians to pursue the concerns I have raised in my report. Clearly, there are many issues that government officials need to explain, among them: what progress is being made in developing a robust system for collecting and reporting information on expenditures and results? What was learned during the Treasury Board-led review of climate change programs and, how is it being shared and used?

    The federal government has accepted all of my recommendations. Therefore, I expect the government's new plan to spell out clearly how these recommendations will be taken into account.

    So, when the new climate change plan is available, parliamentarians will be able to see how the government has responded to the specific recommendations made in my report, and the five areas I identified as crucial to future progress.

    Mr. Chair, that completes my opening statement. I and my colleagues will be happy to respond to your questions now. Thank you.

    Thank you, Madame Gélinas.

    We will now commence our schedule of questioning. I think you're familiar with that. In this committee there is five minutes for questioning. I would ask members of the committee to address their questions through the chair, as is appropriate. Thank you very much.

    Mr. Cullen, go ahead, please.

    Thank you very much, Madame Gélinas, and thank you to your colleagues for coming here today.

    It is a pretty damning report, I think.

    The Liberal government was in power for most of the period that you covered. You did some review of what was happening or not happening in 2006, but it is fair to say that most of your review covered the period when the previous government was in power. Is that right?

    We started to look at this issue back in 1997, really. So we cover approximately ten years.

    Okay. Then as far as the current government is concerned, I guess there is a phasing-in period in which they have to make an assessment. At some point they need to respond and come up with a plan. So we are all waiting with bated breath for their made-in-Canada solution.

    It is interesting that they have accepted your recommendations, so the challenge now is to see how they respond to those.

    I'm not very happy with our performance as a country either. However, the information in front of me says that in the last two years of our mandate as a government, we started to see some progress in terms of greenhouse gas reductions. In the first few years we were getting started, and frankly I think we had a not terribly focused effort.

    Does your information also show that toward the latter part of our mandate we started to make some impact on the reduction in greenhouse gases?

    If we look at the three programs I mentioned previously, it is true that we were able to see some progress made. But those three programs, which were the most important ones, would at the most achieve one megatonne of reduction, and they were designed to achieve five megatonnes. This is really one of the few areas where we can talk about progress, because the emissions trading system, the LFE system, and developing a strategy for adaptation were not really up and running.

    I'd like to move to your finding that there's no sort of consolidated monitoring and reporting on spending and performance. We're talking here about maybe $6 billion. You talked about the lack of a cohesive governance structure.

    To what extent is the lack of monitoring and reporting related to governance? Is it just sloppy bookkeeping or performance management records? What is needed to have a proper accountability structure so there are accountable measures reporting against performance and monitoring of what kind of value is being achieved for the dollars being spent?

    There are a couple of points on that. First of all, at the program level the departments--especially NRCan in this case--were able to provide some good information, even if it took a while to gather it. The information was there but it was not readily accessible. Climate change is really a horizontal issue where many departments are involved. We found that every department, and sometimes every program, had a different way of collecting and wrapping up information. So if someone wanted to get an overview of progress made in terms of results and spending, it was a challenge and it's still a challenge.

    You talked about the $6.3 billion. That was money announced by the previous government up to the budget of 2005. So these types of numbers are easy to gather; we just go back to the previous budgets. When it came time to get the information on how much money was spent, it was really because of a question that was asked a couple of months ago by the committee on environment and sustainable development. We were able to access that information because the Treasury Board was gathering it in response to the committee. Otherwise we would have had a lot of problems gathering it. The reason is that there's no consolidated system within the federal government to gather information and give accurate and updated information in a short period of time.

    Thank you, Ms. Gélinas.

    Madame DeBellefeuille.

    Thank you very much, Ms. Gélinas, for your presentation.

    I would just like to note, for my colleagues' information, that you are a Commissioner and your job is to assess the twenty-five departments required to present sustainable development strategies. It's important to clarify your role.

    My questions have to do with the EnerGuide program. As the new Bloc Québécois critic on issues related to natural resources, I would like to try and understand why the Minister terminated this program.

    I read in your report that, for existing homes, the EnerGuide program had resulted in a 27% reduction in average energy consumption and that the Department can prove that the program led to a 0.7 megaton reduction in greenhouse gas emissions.

    My reading of the situation is that there was some effect, possibly minor, but nevertheless a positive effect. I would like the benefit of your expertise to try and understand why the program was eliminated.

    When inspectors or evaluators would go to someone's house to do an assessment and advise people about the renovations needed to increase energy efficiency, do you think these assessments were important in terms of enabling the government to measure and collect the data, in order to determine whether this program was playing a part in reducing greenhouse emissions by enhancing energy efficiency?

    In fact, the EnerGuide program was designed specifically to allow Canadians to improve the energy efficiency of their homes. So, it was designed by officials with Natural Resources Canada, and it is possible to measure the outcomes. Indeed, when we went to see how the program was managed and implemented, we ourselves were able to obtain that information.

    So, this was not a program that was poorly managed--far from it. At the same time, we did identify certain weaknesses: because the targets had evolved, they weren't always clear, and the way the Department was reporting results was clearly not adequate.

    We asked a number of questions in the House, to try and understand the reasons why the program was being terminated, and I believe we were told that the assessment prior to renovations and the one after completion of the renovations were considered to be of a purely administrative nature. We were also told that because this was an administrative type of program, it was not considered to be a good investment for taxpayers.

    I would be interested in hearing your views on that. Do you believe that the pre-assessment and final assessment are purely administrative in nature or are they in fact interventions under the program aimed at measuring its ability to reduce greenhouse gas emissions?

    It may sound like we're playing with words here, Mr. Chairman, but it is clear that the first phase of the program does consist of an assessment of the home's energy efficiency. And it is based on the results of that assessment that homeowners implement a program of renovations aimed at improving energy efficiency.

    The data from the Department of Natural Resources are clear: on average, program participants improved their home's energy efficiency, as you stated, by 27%.

    But depending on the way you interpret the numbers, it could be considered an administrative cost. However, in this particular case, it was an expenditure related to the program itself.

    And collecting that data enabled the government to determine whether there was greater energy efficiency and, thus, whether greenhouse gas emissions were being reduced.

    Yes, that's exactly what the program does.

    Do I have any time left, Mr. Chairman?

    You have one minute left.

    Can you tell me whether you have evaluated or verified, based on government R&D budgets, the percentage allocated to Natural Resources, and in what specific areas research and development budgets have been allocated?

    We have some information about research and development. But we would have to review the information and try and collate it, in order to answer your question. At the same time, I don't think we could give you a comprehensive answer, although we could probably provide some indications, if you are willing to give us an opportunity to address that a little later.

    I'm sure my colleagues would agree.

    Thank you.

    Merci.

    Madam Commissioner, if you wish to redirect to any of your colleagues, please feel free to do so.

    Thank you very much.

    The next questioner is Mr. Bevington.

    Thank you, Commissioner.

    I will focus my questions on the emissions from the oil and gas sector. You say quite clearly that with the proposed expansion of this sector, we'll overshadow any other greenhouse gas reductions we may make in the system. Maybe you would like to elaborate on that a little.

    First of all, the information we received from the oil and gas sector came in large part from the National Energy Board, and was vetted by the Department of Natural Resources.

    What we have said is that if we look at the exploitation of the oil sands between now and 2015, the emissions will double, on the assumption that production will triple and maybe quadruple. When you look at the numbers, as we speak, the oil sands produce around 35 megatonnes of emissions. That will take us to 70 megatonnes if we double it. If you look at what was in place when we did the audit and what should be up and running in a couple of years, it's basic math. Whatever is put forward in terms of effort, we'll never be able to reduce the emissions. At best it might be able to reduce the rate of growth, and if nothing is done in the oil sands sector it may not even be able to reduce the rate of growth.

    NRCan, the federal government, has some responsibility for energy, as you point out in your book. You've mentioned the National Energy Board. Did you examine their mandate? Would the mandate of the National Energy Board allow greenhouse gas emissions to be taken into account at the project development or approval stage?

    We haven't looked at the mandate of the National Energy Board. We have looked, essentially, at the federal programs, strategies, and policies to address climate change.

    It's important to emphasize that we haven't considered what is going on in the industry per se. To reduce greenhouse gases, there must be technologies in place and energy efficiency programs in some of the facilities. Our mandate was to look at the federal government.

    But if the federal government needs to produce a strategy for greenhouse gas emission reduction, and it doesn't have control over this sector, then the strategy is going to be very difficult to carry into effect.

    You mentioned the constitutional division of responsibilities for energy. Dd you draw any conclusions about any of the tools that could be used by the federal government to rein in the emissions from the oil and gas sector?

    First of all, we haven't looked at strategy. There's no strategy as we speak. We can only audit what exists.

    We have said in many different places in the report that even though natural resources is a shared jurisdiction, the federal government has a lot of tools in its toolbox—voluntary agreements, regulation such as CEPA, tax incentives. There are a lot of things that could be used.

    The reason we said the government has not tackled the oil sands is that when you look at the overall programs and strategies, there was nothing put in place to address this sector.

    You talked about the carbon dioxide capture and storage initiative. There's one project that's been up and running for five years, and it's taken its target of 3.5 million tonnes and reduced it by 2.5%.

    Did you look at the costing of this program versus the results it was delivering?

    I will go with your latter point and ask my colleague to give you the details on the numbers. I don't know all of them by heart.

    We haven't done a cost-benefit analysis for all the programs we looked at, so we cannot comment on the efficiency of them. We looked at only three. If you take the example of natural resources, there were more than 30 programs we could have looked at, but we decided to focus on three.

    The oil and gas sector is part of the LFE, the large final emitters. The previous government was going to regulate that sector through the Canadian Environmental Protection Act, which is an act that serves to protect Canadians. It is concerned with pollution prevention—protecting our air quality, our water quality, and the soil. The oil and gas sector is included in the LFEs, the large emitters. There was a target being negotiated with industry. It was being reduced with time, but at least it was a start.

    Mr. Paradis.

    Thank you, Mr. Chairman.

    Commissioner, I want to thank you for being here today. I have two questions, one which is of a general nature, and the other, more specific.

    Commissioner, I recall that we had a discussion in the spring at this Committee with respect with your 2005 Report. Some of the troubling issues are mentioned once again, and therefore, I find it rather amusing when I hear my colleague talking about an improvement in the last two years. You particularly emphasize the lack of leadership as explaining the poor results we are seeing today.

    In that regard, how do you explain the five points you raised in paragraph 25 of your presentation? Billions of dollars have been invested, particularly to reduce greenhouse gases, and yet there are no results. Is that reflected in these five points? Are they a solution we should be paying particular attention to, so that the money invested finally leads to concrete result?

    Let's look at those points again. Leadership has to be demonstrated in a number of ways. It has to be demonstrated at the political level, by the political leadership. It also has to be demonstrated at the level of the public service. If there is a national goal, a common goal, that must be visible in departmental activities and priorities. It should also be seen in the context of federal-provincial relations, or in the industry's desire and interest in helping to find solutions. Leadership has to be demonstrated across the board. Given the kind of results we have attained so far, it is clear that the government will have to show strong leadership in order to tackle the problem head on.

    There are some issues that remain and which will not change, such as governance and accountability. At this time, those problems have yet to be resolved. If you decided tomorrow that you wanted to have the most recent information available, it could be very difficult for you to get that information, because the system that would enable you to do it has not been implemented. It's important that parliamentarians ensure that the commitment to implement this system is honoured as quickly as possible.

    I can give you other examples. For several years now, we have pointed to the fact that this whole file has been transferred from one department to the other. There have been different ministers and deputy ministers involved. That leads to all kinds of delays, and often, a loss of momentum. That's why things slid somewhat and we are now seeing these kinds of results.

    Thank you.

    Before we leave that point, I'd like to give you an example. The current government has pledged to table its own green plan. There has been positive feedback from Quebec, specifically the Ministry of the Environment, which has said it feels confident about what is going to be brought forward.

    Further on in your report, I read that when provincial incentives are in place, the federal measures are enhanced; in other words, there is leverage on both sides. Is this an example of leadership that should be followed?

    I also want to talk about the EnerGuide program. In your report--and you repeated that today--you say that the targets were not clearly defined. People did a lot of renovations, but I'm wondering whether they wouldn't have done them anyway. I'm not saying that the process would have been as efficient had there not been an assessment. There are many different possibilities.

    Was that one of the examples you relied on in concluding that the targets were not clearly defined and they should be clarified?

    I'll start by answering your question about the EnerGuide. It just isn't true that the program was not well structured or well managed. The targets were well defined at some point, but they changed, and the appropriate adjustment was never made.

    As for whether people would have renovated their houses anyway, I obviously can't answer that question. However, I do know that in 2003, when the government enhanced the EnerGuide program by adding an energy efficiency assessment and analysis, we noted that Canadians were much more interested in availing themselves of the grant; there is a graph on that in that chapter of the report. However, a prior assessment had to have been carried out.

    As regards leadership, I will simply say that an auditor always expects to see results and does not base her opinion on words alone.

    Thank you.

    Members, we'll now go through our second round, and I have Mr. St. Amand, Mr. Ouellet, and Mr. Allen on this one.

    Mr. St. Amand.

    Thank you, Mr. Chair, and thank you, Ms. Gélinas and the other panel members, for your work on this and for your cogent presentation today.

    If I can summarize at least components of your report, it seems to me that Canadians, arguably more than ever, are aware of climate change as an atmospheric problem. Certainly the surveys and anecdotal evidence would point to Canadians being engaged in this issue, and your report recommends, among other things, that the federal government must show leadership with respect to climate change. Is that fair to say so far?

    Whoever the government of the day is, leadership is needed.

    To this point, having studied the issue over a period of time, the money was seemingly allocated to a greater or lesser extent, some $6 billion. It would seem as a reflection of that allocation that the political will was there, if I may, but the reporting techniques, the missing of targets, and the tracking of results came up rather short. Is that a fair summary?

    It's more than that. Tools that were announced are not up and running as of today. If we again look at the two key sectors--transportation and industry--beyond some approaches that were proposed, there was really nothing that could have given us some very strong indication that we were going to achieve the Kyoto target. It's more than just a lack of good accountability and good systems in place so that we can track money and results. It's more what was put in place. If we go back to 2000, 2002, 2005, the three plans have not achieved as much as they should have.

    If I could then be a little forward looking, I'm looking at chapter 3, Madam Gélinas, of your report, on page 22, paragraph or item 3.61. You make a recommendation that

    I presume what follows is essentially the response from Natural Resources Canada. Is that fair to say?

    Yes.

    At the risk of sounding partisan, Natural Resources Canada's response, in my reading of it, falls rather short in terms of meeting your recommendation. I'm wondering if you could comment on your level of approval or disapproval of NRCan's response to your recommendation, because NRCan has less than three months to comply with the recommendation.

    There is no timeframe to respond to our recommendation, first of all.

    If I may put what you have just referred to in context, the paragraph before was referring to some type of commitment from the Minister of Natural Resources, Mr. Gary Lunn, when he testified before the committee saying that the department was in the process of developing an energy framework or strategy. It's not clear which word sums up what they were working on, but it was some sort of energy document.

    What we have said, and that's what the recommendation referred to, is that the government should be clear in terms of what it intends to achieve in that sector and on what the overall game plan is in Canada with respect to energy--how the government will reconcile energy development, economic growth in this country, and greenhouse gas reduction.

    With respect to the response, you're right to say that it's vague, to say the least. This is why I have said that when the government plan or approach becomes publicly known it will be important, especially for you, because I will not follow up on those recommendations in the near future, but it will be extremely important for the committee to ask the government how it has factored in my recommendations in their plan. My understanding is that the government has said they will come back and explain exactly how that was taken into account.

    Thank you, Mr. St. Amand.

    Mr. Ouellet.

    Thank you, Mr. Chairman.

    First of all, I want to say that I think the role of the Commissioner of the Environment and Sustainable Development, and of her assistants, is an important one, and we are very pleased to have them here before the Committee. We encourage them to continue their work, which we see as absolutely fundamental.

    Now I have a question for you, Ms. Gélinas. In your 2006 report, you again emphasize the importance of leadership; we discussed this earlier. You suggest that the government should develop a clear sustainable development strategy.

    To your knowledge, has the Department of Natural Resources begun to outline a federal strategy on sustainable development?

    You are talking about sustainable development?

    Yes.

    Okay.

    I will turn it over to my colleague to give you additional details.

    However, I do want to remind Committee members that every department has an obligation to produce a sustainable development strategy, which has to be reviewed and amended every three years. In a few weeks--in two or three months at the most--departments will be tabling their new strategies in Parliament.

    We know that over the years, the Department of Natural Resources had made a lot of progress in terms of commitments, which could make a difference, and meeting those commitments.

    As the Commissioner of the Environment and Sustainable Development, I would say that you can always do more. However, if I compare sustainable development strategies overall, I'd say that the Department of Natural Resources has generally done some very good work.

    My colleague may want to add something; he is the expert on strategies.

    I can certainly add something to that. However, I hope you don't mind if I make my comments in English.

    This is a wonderful opportunity to bring to the committee's attention one of our ongoing concerns, which is, as the commissioner has talked about, this particular department responsible for strategy and what it has done, and the fact that the federal government still hasn't produced an overall strategy for sustainable development. That's been a concern that we've raised in reports for a number of years now. It's a commitment that Canada made going back to 1992. It was a commitment that was made most recently by the government to produce by mid-2006, and we're still waiting for that long-awaited strategy.

    Merci.

    You say this in your report:

    Because I'm relatively new, could you tell me what strategies are currently in place? You say that new strategies are needed, but what strategies are currently there? Were you able to assess the sustainable development strategies that are currently being implemented, since you speak well of them?

    My mandate is to report every year on sustainable development strategies. There are more than 30 of them and, just to give you an order of magnitude, all across the federal public service, there are more than 2,500 commitments.

    I'm sure you can understand that is impossible for me to verify all of them. As a result, this is what we do: every year, we select a certain number of departments and a certain number of their commitments, and we audit those and report on progress.

    This year, we tried to look more at climate change, in order to focus more on that in the report. As a result, I can't give you a general answer with respect to the progress made in terms of strategies, but I can say that these strategies--and it's really too bad--have not received the attention they deserve.

    If the Standing Committee on Natural Resources decides subsequently that it wants to know about the Department of Natural Resources's game plan for sustainable development, I would suggest that starting in January, you hold a Committee meeting to look at its strategies and question it in that regard. You'll see for yourselves that there is something for everyone.

    Thank you.

    Could I ask another question?

    A very short question, Mr. Ouellet.

    Earlier we talked quite a bit about EnerGuide. I note that you also refer to it in your document. As well, you were saying that you can't make an assessment from the outside.

    You surely know--and I want to take this opportunity to mention it--that $500 million was set aside for social housing. However, no one ever had any work done, even though a little earlier, someone at this table said that people would have had that work done anyway, even if they had been unable to receive assistance from Canada.

    Canada spent exactly $1,456 for every household involved in the program. You and the industry as a whole are saying that this resulted in energy savings of 27%. That means that homeowners in Quebec and Manitoba saved about $500. In the rest of Canada, the average is $750. That is a two- to three-year return on Canada's investment. You can't do any better than that when it comes to energy efficiency. It's amazing!

    I'd like to be able to do the arithmetic as quickly as you can. I'll leave you these figures.

    Madam Commissioner, we'll have to take that as an observation that is made. You may want to weave that into a future answer, but we're out of time on that one.

    We'll go to Mr. Allen.

    Thank you, Mr. Chairman.

    Thank you, everybody, for being here. I'm going to focus my questions on the governance side and the accountability side.

    Page 1 of chapter 1 of the report talks about responding to climate change, management across multiple departments, and the challenge of that. It also talks about levers, resources, and expertise to manage this adequately.

    When we then go further into the report, on page 10 it talks in paragraph 1.15 about the 1998 report, saying we had sporadic performance. In paragraph 1.16 it refers to where the 2005 Standing Committee on the Environment reported, and again there was no leadership of this structure.

    I want to point to paragraph 1.21, which says Environment Canada currently has the leading responsibility, and then there are other statements that say Treasury Board Secretariat should take the lead in these programs that go across. We then have the Climate Change Secretariat, which was phased out in 2004 and which had a leadership role. How can you help me reconcile all these people who were in charge, and what are your thoughts on that?

    It's a challenge, and it has been a problem that we have faced for a while. Richard would be better positioned than I am to give you the details and reconcile what the status is as we speak.

    Yes, climate change obviously is a horizontal issue touching a number of departments and central agencies. Leadership was given at different times to Environment Canada and Natural Resources Canada on this. There was a secretariat that was reporting to the deputy ministers of both departments at one point. It was serving a purpose of federal coordination with the other departments, along with facilitation, as well as reporting. Since they've disappeared from the horizon, no one has replaced them.

    Treasury Board got involved at one point. The central agencies decided to get involved when the decision was made to ratify Kyoto and all that. They decided to take more of a leadership role in terms of trying to put in place the structure that was needed. They decided to produce what's called an RMAF, a big plan, a map of all the federal programs, just to find out what exactly is going on in all these departments. Once you have this map, you then can come up and do a program review, and that's what they were trying to do.

    What they also tried to do was put a system in place to capture the information that was needed in order to do proper management of the file. They wanted to know how much money has been spent on these programs overall, and what results have been achieved.

    There was a program review. The results have not yet been transmitted to Parliament or to Canadians, but there's certainly a lot of information there. That was the logical sequence in which to do it, but they came in very late in the process. A number of programs were in place, but they were not talking to one another; they were not connected. They might have caused some duplication in some cases, but no one knows. The program review was the way to do this.

    When we looked at this, we saw transitions going on as well—transitions between governments and the transitioning of key people in the civil service who deal with this issue. This transition of people also caused some more delays, so essentially the situation was not a clean one.

    Now, when we were looking at making recommendations to the government, we wanted to make certain we were going to be addressing the recommendations to the right bodies of the government, so we were going to go to central agencies. Those central agencies told us they are not responsible for this, they are there to assist departments and ministers. Therefore, they said Environment Canada has the leadership.

    That's why we have this story that is kind of complicated in the chapter.

    Do you believe the program review has taken into account this road map, if you will?

    Yes, the program review has looked at the road map, but Treasury Board has said there are things missing from this big road map. One of them is the governance piece, and another one is the performance management piece.

    In 2004-05 things were starting to get in motion in a positive sense, but they were never completed, as far as we can see.

    That leads me to my next question then.

    We've talked a lot about some departments being stronger in their management systems and reporting systems than others, and it shows in the results in those departments. Given the firm commitment by the government that we're going to put the governance in place, then in your estimation, how far away are we from setting up the management systems and information systems to collect this data?

    The Treasury Board has been working on an electronic system to capture information, but this information obviously comes from departments and departments have different definitions of what they are doing.

    Treasury Board was trying to facilitate a process where everyone would work from the same page. I think it has made progress in terms of doing that. The idea was that once the program review was completed and decisions made, the information in the system would be updated.

    They also made a commitment to make it transparent and available on a website, which has not happened yet, and we don't know how far away we are.

    Perhaps I may give you some timeframes. The government structure....Treasury Board hasn't committed to any date with respect to the performance framework, but it should be available by mid-2007.

    Thank you.

    We'll now go to our third round. Mr. Russell, Mr. Trost, and Mr. Cullen.

    Thank you, Mr. Chair, and welcome to everybody this afternoon.

    I apologize for the Blackberry. It's a bit of a cultural shift for me, seeing that blackberries are usually better in puddings and buns in Labrador than they are ringing next to your ear. That having been said, I'm glad you're here.

    I have a couple of comments, first of all. I was in a community of about 250 people this summer, and one of the elders in the community was telling me there's less ice, less sea ice, and this is something that has been going on for years now, and that type of thing. He was saying they were going to have to change their snowmobile trails. I was thinking at that particular point that if they had to do that, it would cost more money because they'll have to build them over land instead of across sea ice. It's going to take more time for the movement of goods and services.

    It struck me at that particular time how important this whole issue is, and how it affects people in a community of 250, and how they are becoming in tune with not only a local, regional, or national problem, but an international problem and challenge.

    In that context, I am wondering with respect to the Kyoto Protocol and the targets that were set out, what's your assessment of how important those protocols are, those international targets that have been set and Canada attaining those particular protocols and targets? There is some talk of a made-in-Canada solution, and I don't see it as only a Canada challenge. It is something that the global community has to address as well, isn't it?

    I am wondering about this because the current government seems to think the Kyoto Protocol is not that important.

    The only thing I can say about that, Mr. Chair, is that the target that was set by the government when it ratified the Kyoto Protocol was not based on sound analysis. I mean, as we were doing the audit, it became obvious that this number was not supported by any kind of strong social, economic, and environmental analysis. So the question is, what is the cost of achieving the Kyoto Protocol? I guess nobody knows.

    What is the cost of inaction, though? That's another interesting question. Nobody knows, because we don't do that kind of analysis. At least we haven't seen anything in the course of our audit that will support that.

    Then the third question is what is the cost of adaptation? When you are referring to what is going on up north, Neil and I had the privilege about a month and a half ago of going to a remote island in Nunavut, and I heard the same anecdotes--if we can still call them anecdotes, because we hear so many of them.

    It's not clear how the government will manage adaptation to climate change, which you have to remember is also a component of signing the Kyoto agreement. There were two components to the agreement: adaptation and mitigation--reducing greenhouse gas, but also getting prepared to adapt. There's nothing in the books to clearly identify that the government was prepared to move in the direction of adaptation.

    On the EnerGuide program, what would you say were some of the successes of that particular program? Could you reiterate? It seemed that in all of your critique of the environmental programs that are in place, this one seemed to have some positive light shined on it.

    What would you say were some of the positive attributes around the EnerGuide program? Are there things with the EnerGuide program, or the model that was used or the structure that it had and the reporting that it had, that we could use in other programs that may be developed?

    What we have said about the programs is that they were achieving results, maybe not to the extent expected, but they planned to achieve their targets by 2010, so we have to wait and see if they're going to get there. So far the two we looked at, WPPI and EnerGuide, have achieved one-third of their objectives, so they are moving in the right direction. Some of them were just at the beginning of really taking off, so we don't know how much these programs would have achieved or will still achieve.

    Thank you.

    We've actually just come to the end of this time period.

    We'll go to Mr. Trost.

    Thank you, Mr. Chair.

    I guess I'll start off by giving a little bit of a summary of one thing that I don't know if you can really answer. The one question I have is whether we are sometimes looking at the leaves and not seeing the forest. There are other environmental problems out there too. There are other ways of tackling this.

    Canada is responsible for about 3% of the world's carbon dioxide emissions. When China, Russia, or places like that get rolling, what's 3% in the overall world scheme? I sometimes wonder if maybe we're looking too close to home or maybe not concentrating, because this is not a zero-sum game. Technology exports to help China clean up a coal problem or something like that might be a better way to tackle some of this. I'm just blue-skying here, or even looking at....

    As the Minister of Environment pointed out, there are other environmental problems. I mean, 3% out of the whole world's carbon dioxide emissions, even if you accept absolutely everything.... There is the open question of what it would do, and that's something that's not seen. I know that's not something addressed in the audit per se, but it's a broader question that the policy people have to deal with.

    I didn't peruse the report in detail, but I did try to read as much of it as I possibly could, and skimmed through it. What I would like you to comment further on and what struck me continually as I read the report was that there was a lack of information, it was difficult to assess, it required knowledge to assess, there was the cost of goals, etc. While Mr. Allen dealt with that by talking about governance and control, the overall question I have is while the governance may be one portion of it, how much data collection is there that's accurate, and how much analysis that is totally broad is there between the departments? Does it vary greatly? I don't know if I'm expressing myself well.

    I ask this because in order to make an accurate decision as policy-makers, or to make accurate assessments of its working, you actually need very detailed data. You need the economics. You need the science. It's very complicated.

    In your opinion, were the departments collecting the data sufficiently? Did they have enough data? Was it just management of data that was a problem, or was the problem the underlying lack of data that they had in total to make the judgments? Because it's one thing if they just have the data and misused it; it's another thing if they didn't have the resources to get it. Could you make a judgment? If it's the same all across the board, just say it's the same across the board. If different departments did better, I'd appreciate if you woud lay out your opinion on which departments performed better and which departments performed worse.

    Is that clear?

    We haven't made a comparison among departments. What I can say--and I will let Richard give you more details--is that the data is good. If I'm right, even the international community has acknowledged the quality of the inventory work that Canada is doing. The foundations are very good.

    I'm not just talking about calculating the number of tonnes of carbon dioxide and everything, but about actually analyzing the cost-benefit analysis when it comes out.

    I'm getting there.

    The foundation is good, so I don't think that there is a need to discuss that.

    As far as the analysis goes, it depends. Sometimes it's obvious that there is a lack of analysis, and we have referred to that many times. You may have access to much better analysis now that the program review by Treasury Board has been done on most of the programs. When you get access to that information, you will be able to judge the accuracy of the information that is provided to you. If we take the example of adaptation, the information is there. There is a good chunk of information, but that information has not been translated for decision-makers, so it depends where you look. Sometimes it's good, sometimes it's weak. Sometimes it's getting there. Sometimes more work is needed to be able to have good information. So there's not one answer for the overall activities of the government with respect to data and monitoring.

    There's time for one short question, Mr. Trost.

    I'll just say that this was my basic point. When we give advice, are we going to give advice that says, “The information is there; just coordinate it,” or, “Go back and get more information?”

    I think you answered that, but I think you also, reading between the lines, say it's really going to vary department by department, program by program. Is that correct?

    That's true, but it's also topic by topic. Adaptation may differ from gathering information with respect to spending, for example.

    Thank you, Mr. Trost, and thank you, Commissioner.

    Mr. Cullen, we'll now go to you.

    Thank you, Mr. Chair.

    I'd like to touch on two areas: the oil sands, and then EnerGuide and the wind power production incentive program.

    Concerning the oil sands, based on the way things are proceeding, would it be your assessment that the scenarios you're aware of today are going to be a sustainable way to proceed in the oil sands?

    If I knew that answer, a lot of people would be running after me to get it. I don't have the answer for you.

    I would suggest to you, Madam Commissioner, that it's not sustainable. I guess it depends how you define sustainable. But if you look at the increase in the greenhouse gases, at the carbon dioxide, at the way the water is being dealt with, and at the impact on local communities, I'm not sure that the way it's progressing today is sustainable.

    Another aspect of this would be.... There are many propositions that come up from time to time. Today we hear that EnCana Corporation and the U.S. giant ConocoPhillips are talking about a joint venture, so that oil sands production would go into refinery capacity in the United States. That raises a number of political questions and other public policy issues that I have a certain perspective on. Is that the kind of thing you would look at, in terms of whether or not this is a sustainable approach?

    The second part is this. We hear a lot about carbon capture and sequestration and a lot about recycling water, but those technologies are not in play yet. How long will it take to get them into play?

    Could the federal government, for example, redeploy some of the tax expenditures that go to the oil and gas industry now? I have some research on that, which tells me there is about $1.2 billion to $1.4 billion a year in tax expenditures to the oil and gas sector. Why not redeploy those resources to accelerate the development and deployment of technologies that are going to capture and sequester carbon and deal with the recycling of water?

    Mr. Chair, these are policy decisions. But I would like to add two things.

    It's not up to me to decide whether we are moving on a sustainable path or not in Canada. But I will remind you that any new policy or program developed by the federal government should go through what we call a strategic environmental assessment, which means that the bureaucrats, before they design the policy or the strategy or the program, should look at the environmental impact, the social impact, and the economic impact and take the best decision. This analysis should be made available publicly so that people will be able to judge what work was done before the decision was made and judge it on the merits.

    But as you know, my job is to give you the information, and you are the ones who then make the judgment.

    With respect, I would think you, as the Commissioner of the Environment and Sustainable Development, might have a view on whether or not we are proceeding in a sustainable way in the oil sands. But I'm not going to pursue that.

    I'd like to come back with a quick question on EnerGuide and the wind power production incentive program, which have been frozen by the government.

    We heard from NRCan officials that there had been some Treasury Board evaluations, and I thought I heard the NRCan people say, “But we haven't actually seen them.” That struck me as somewhat odd, and frankly I think we need to call the Treasury Board people here to explain what work has been done.

    Have you actually seen the evaluations that Treasury Board has done? And what do they actually say?

    I think we have seen part of the evaluation, but we haven't had access to the documents that were sent for cabinet decision. This is not something we have access to.

    Were the ones you saw highly negative or positive with respect to, let's say, EnerGuide or the wind power production incentive program?

    I don't know myself.

    It's variable, and the Treasury Board has criteria to evaluate, first of all, if a program that was submitted was truly a climate change program or something else, because often departments mix the two. It wasn't a program that was providing benefits from a standpoint of climate change but the program was more an environmental program dealing with some other issue.

    In terms of the results, again we cannot speak of those, because they were submitted to cabinet for approval and we do not have access to the information, but we know that they followed a very rigorous process. Departments were involved, information was provided, was returned in some cases to the department when it was not complete or was not following the proper framework, and then they were moving like that to get something they could make decisions on.

    We're out of time there, Mr. Cullen.

    With respect to that line of questioning, I would remind members of committee, and perhaps inform Madam Commissioner, that the committee will be embarked on an oil sands study commencing next week. I don't know whether you're aware of that, and some of these questions obviously will be raised.

    With respect to the second point from Mr. Cullen, the chair will be seeking some process clarification with respect to follow-up. For example, in Madam Commissioner's report she does refer to the Treasury Board and some of that, and what I'll be suggesting at the end of the meeting is that we agree on a process of follow-up of some of the things in this report. So the chair will be seeking some direction at the end of this meeting with respect to that.

    Madam Gélinas, do you--

    I was just going to bring a point of clarification. I would love sometimes to give and share my views with you, but my mandate doesn't allow for that. I don't want to leave any confusion that it's not by a lack of desire, but because my mandate doesn't give me that privilege.

    Just so there's no confusion, I think we would all love to share those views with you.

    I would like to point out that there is a definition of sustainable development in the Auditor General Act, and if you read the definition and you look at the explanation you gave us, I think there's probably a sustainable development issue there.

    Okay, thank you for that.

    We'll now go to Madam Boucher.

    Good afternoon. What I have learned today has been very interesting.

    But there is one question in particular that concerns me. In Chapter 1 of your report, you note that progress with respect to reducing greenhouse gas emissions by large industrial emitters is very slow. I would like you to present the key elements of a successful policy aimed at reducing emissions, particularly in the industrial sector.

    It is not really up to me to suggest the kind of steps that need to be taken. However, basing myself on my experience as an auditor, I would say that when you plan something, it ends up getting done. As a general rule, when you set objectives, the mechanisms are put in place to meet those objectives and to measure performance and outcomes. When there are no objectives, it becomes very difficult. You can always say there has been progress, but it will never be tangible, measurable progress where you can make a connection between the costs of a program and the outcomes in terms of efficiency.

    That is a question people often ask me. The first step is to set objectives, and then to develop measures.

    The third critical component is to produce public reports, so that Canadians can find out what progress has been made.

    Does anybody else wish to take the balance of Madame Boucher's time?

    Okay, then we'll go to the final round. I have Mr. St. Amand, Madame DeBellefeuille, and Madam Bell and Mr. Bevington will be splitting their time.

    Mr. St. Amand.

    Thank you, Mr. Chair.

    Ms. Gélinas, in your remarks today on paragraph 11, or what I have as paragraph 11, and perhaps you have the same sheet, dealing with the transportation sector, you make a comment about the voluntary agreement that was entered into between the government and the auto sector. You have a comment about voluntary agreements, that the particular agreement entered into between the government and the auto sector falls short in a few key areas.

    I'm hoping I'm not steering you toward the area of policy, but I'm wondering if you have a comment, given the urgency of addressing the issue of climate change, as to whether it is your view that voluntary agreements in and of themselves are likely going to be inadequate in addressing the whole issue of combating global warming, climate change.

    Can you fairly comment on that?

    I can just refer back to what we have said in the past in the Office of the Auditor General. We were not favouring one tool over another. What we are saying is that every tool will be developed as robustly as possible, and if it's the right tool to achieve the objective, that's fine. But we have seen in the past, and we have looked at that, that voluntary agreements were not as robust as they should have been. And the most important thing, in this case in particular--and it's not for me to judge if at the time it was the right tool or not--is to have third-party verification so we will know if this agreement, in particular, is working well or not.

    We don't know as we speak. We haven't seen the results, but it's important that Canadians can see what results are achieved through this particular tool.

    All right.

    In chapter 3 of your report, dealing specifically with the wind power production incentive--and I'm looking at page 9 of chapter 3 and the bold heading of one section, “The Wind Power Production Incentive is progressing toward its targets”--you earlier made mention in your remarks about how, albeit short of the targets, there was in fact considerable progress being made under the auspices of the wind power production incentive.

    I'm just wondering about your reaction to NRCan's response to your recommendation 3.27, your recommendation being:

    The response from NRCan, in my reading of it, to be charitable, seems on the tepid side--it's certainly vague--and I'm wondering if I could ask you to comment on that.

    The response of Natural Resources Canada is clear. First of all, if this program is to be pursued--it's unclear what the future of that program is--there will be some more work done. You have to know that there was a wind strategy in the making. NRCan worked on that, and we have seen some of the work as a draft version of their strategy. They have even gone through consultations on that strategy, so you may want to know a little bit more about where NRCan is with respect to that strategy and what the objective of the wind power strategy was at the time. It would be very interesting to have an update on where the department is.

    We're just going to have to cut it at that. Thank you, Mr. St. Amand.

    We'll go to Madame DeBellefeuille.

    Thank you, Mr. Chairman.

    You say that you recommended to Natural Resources Canada that it take a lead role in developing a wind energy strategy. The WPPI program does exist, however, and was supposed to be reviewed in March of 2006. That was never done. Natural Resources Canada said it would carry out an assessment during the 2008-2009 fiscal year.

    Please reassure me. These days, the government has accustomed us to the following process: when there is talk of evaluation, it cuts the program first and evaluates it afterwards. That is exactly what happened with programs for women and many other programs, such as EnerGuide.

    Were you given any indication that the WPPI program would be suspended or frozen pending a future review?

    As you say, based on our information, funding has been frozen while they evaluate the program. You would certainly be given much more information if you put the question directly to the Department or the Treasury Board. What I perhaps should add, with respect to what you've already mentioned, is that before pledging to evaluate the program itself, the Department of Natural Resources clearly indicated that it would wait to see what future the program might have and that, depending on what the new plan includes, it would determine the next step. That was very clear in the documents we examined. The next step was indeed to proceed with an actual evaluation of the program.

    So, according to your information, the WPPI program has been frozen. No new money will be allocated, then.

    When they say it's been frozen, does that mean the amount will remain the same, or that there won't be any more money?

    In my opinion--and my colleagues are free to correct me on this--when they say the program has been frozen, that means that no money will be spent for the time being. They will complete the evaluation, and after that, the government will make a decision. That does not mean that the program has been abolished, or that there will be no additional money. It simply means that for the time being, things are at a standstill, pending the results of the evaluation.

    It is fair to say that the program has been suspended until the evaluation is completed?

    I don't know whether it has been suspended, but my colleagues seem to be saying it has.

    Yes, I would say it's in suspension at the moment, while the funds are frozen. So they can't make any new engagements with new wind projects until a decision is rendered.

    I am not yet very familiar with the departments, and particularly the Treasury Board. However, as a member of Parliament and taxpayer, I would like to know whether it would be helpful for the Committee to hear from Treasury Board officials, so that they have an opportunity to explain how the funding for the different measures related to climate change will be broken down. We could review the document tabled in Cabinet, a document that you did not have access to.

    Will you make that recommendation to the Committee?

    It's important not to mix apples and oranges. I think it would be appropriate for the Committee to ask officials from Treasury Board, which is a central agency, to appear. In terms of knowing how much money the federal government has spent overall on climate change, theoretically, it is the Treasury Board's job to collate this information and pass it along. So, that could be very helpful.

    Based on our experience, I would suggest that you let Treasury Board officials know now what kind of information you are seeking. I should remind you that you don't just press a button to obtain that information. There is a great deal of work involved in researching and collecting information, particularly when it comes to expenditures and outcomes. I don't know how far along that work is at this time. However, in June, it was difficult to obtain all the information, even for us, as part of our audit.

    So I suggest you put the question directly to them, and hope that you will get an answer within a reasonable period of time.

    However, the information related to program review should be available.

    Mrs. Claude DeBellefeuille: Pardon me?

    Mr. Richard Arsenault: Information with respect to costs, outcomes, and so on should be available through program review, that took place towards the end of last year.

    So, I guess we could ask Treasury Board officials to appear to answer questions about program review?

    Yes, absolutely.

    Yes, of course.

    Thank you.

    Thank you.

    Madam Bell.

    Thank you, and I would also like to thank Madame Gélinas for her presentation and this excellent report.

    I have just a couple of quick questions. EnerGuide and the WPPI seem to be the favourite topics today. You've said that the EnerGuide program may not have had clear targets but that it was not poorly managed and was on its way to meeting its 2010 goals, whatever those were. But now it's gone. It has been cut.

    The Minister of Natural Resources, Mr. Lunn, said last spring that it was inefficient and that 50% of the costs for that were administration costs. I'm just looking at the tables in chapter 3, on page 6 and page 10. On page 10, where you have program administrative costs and it says “24.5”, is that a percentage, or is that millions of dollars? I'm not quite sure how to interpret it.

    Mr. Chair, I will let my colleague David just walk you through those numbers so that you will understand what this is all about.

    The figures in this table do refer to millions of dollars. As you walk from left to right, there is the authorized funding that our department received. Next is the actual payments that they have made in the form of grants or contributions. Then comes payments for what they record as operating expenses, but we broke it out into two parts. Because they've issued contracts directly from their operating expenses to energy evaluators, it shows up as an operating expense or potentially interpreted as an administrative expense, but in fact those are contracts to enable the home inspections to take place.

    The actual program administrative costs that we're accustomed to talking about, such as staff, facilities, running data systems, and that sort of thing, represent $24.5 million, or roughly 25% of the cost of the program averaged over the period of time covered here.

    Madam Bell, we're going to have to go to Mr. Bevington now.

    Are my two minutes up already?

    Yes, two and a half. I know it goes very quickly. I'm sorry.

    I have a couple of questions.

    Your work here, Madame Gélinas, is going to guide us in some degree in the future.

    You talk about the ethanol program and you say that the 10% gasoline compares to about 4% reduction in greenhouse gas emissions. This is a low figure. Are you confident with that figure? Has that figure undergone some rigorous analysis?

    That figure doesn't come from us. I think there's a direct correlation between the production of ethanol and blended gasoline and what we can expect in terms of greenhouse gas reduction. Here again, David can give you the details on that.

    Thank you, Mr. Chair.

    The basis for that 4% comes from a modelling program developed by Natural Resources Canada, and they can explain how they developed it and who they brought in to assist them with it. Basically it is....

    Okay.

    The second question.... Going back to carbon storage, you didn't analyze this and lay it out as you did the other three programs, but clearly when you look at the results of this program, we don't see the money entered into the system, but the results coming out are very poor. Is that an indication of the ability of this program to produce results, or is it simply that the program was poorly initiated? We have results in this carbon dioxide storage initiative that are worse than any of the other programs in here. Could I have a comment on that?

    The answer is very simple, Mr. Chair. We haven't looked at this program in detail. We have very few comments to make on it.

    But it's certainly going forward in the oil and gas industry. This has been touted as one of the most important parts of their greenhouse gas reduction strategy, and you've got a report here that shows very poor results from the test programs you have in place.

    The last question I had was on wind. Did you analyze the success of the wind program based on other wind programs, such as those in the United States, where the subsidy for wind energy is somewhat double what this Canadian program is?

    The answer is no, but I can say that when we interviewed people in that business in the course of the audit, we were told this program has had a lot of support and has also stimulated investment in this area.

    Okay, thank you, Mr. Bevington. We are out of time.

    Now, Mr. Harris, please.

    Thank you, Mr. Chair.

    Madame Gélinas, I thank you for your presentation.

    There are a lot of interesting questions for you today. You made a comment earlier in your responses that to get something done you should have measurements, measurements where you have achievable benchmarks set so you can do your checks and balances throughout the process or throughout the implementation of any program.

    It appears to me that in your report--although I have to be honest, I haven't read it cover to cover, but I have had briefings on it--you're quite clear in your assessment that the environmental and sustainable development approaches by the previous government had a profound lack of benchmarks and a way of checking the progress, a way of ongoing cost-benefit analysis of the money being spent versus the results that were being achieved. That's what I get from your report, although you may not use such strong terms as that. Am I understanding the gist of your report and some of your comments correctly?

    You're right with respect to some programs. If you want to measure, you need a target to measure against, right? In some cases, those targets were unclear. We mentioned this, at least for the programs we looked at.

    In many other areas, the measures were never implemented, so it was very difficult for us to report on progress. The best examples are the LFE system and the emission trading system. We don't know how those two tools would perform, because they are still under construction. In such cases, it's very hard to comment on how good the measures would have been. We just don't know.

    I appreciate that you're unable to make that assessment. I remember, going back to the early days of Kyoto, that there seemed to be a lot of difficulty in getting the government of the day's plan for what Kyoto was, the targets they had set, and how they were going to get there. Nor was it easy to find out what it was going to cost the government over the next ten or twenty years to achieve their targets. Quite frankly, I think Canadian taxpayers would have a hard time determining whether they were getting any value for the tax dollars that were spent.

    I support your demand for encouragement and direction. The current government and governments to come should have solid benchmarks and assessment means—not just in the beginning, but throughout the progress of any environmental plans we make.

    I know that the current government has set an ethanol target: 5% of gasoline should consist of ethanol by the year 2010. Do you think this is an achievable target that can be measured along the way, between now and 2010, so that we'll know whether they're on the right track?

    I cannot tell. Let me remind everybody that we have also said that there are some good foundations to build on. I'm sure we'll all agree that it's not too late to do better. We have to make sure that whatever targets the government establishes, we have a system in place to measure and report.

    As I mentioned in my report, it is public knowledge that there was no strong foundation for the “6% below 1990”. So let's make sure that in the future, whatever the new targets, we have sound analysis to explain where the targets came from and how we're going to achieve them. I'm hopeful that the new plan will address this point, as part of my recommendations.

    Thank you.

    That completes the round. We have a little bit of time, and I'd like to take some direction from the committee on whether we could go in the order of parties. If there's an additional three minutes, that would take us through. Is that okay?

    Some hon. members: Agreed.

    The Vice-Chair (Mr. Alan Tonks): All right, let's go around.

    Mr. Cullen.

    Thank you, Mr. Chair.

    I would like to come back to the EnerGuide. The Deputy Minister of Natural Resources was here and said that 12¢ out of every dollar was administrative, and 38¢ was the pre- and post-audit, which any reasonable person would say was required.

    I think the fundamental question is whether that program was getting bang for the overall buck, and that would be in comparison with alternatives. So if the new government comes in and replaces this program, I'd be very curious to see what kinds of evaluative tools they've used to model the fact that a new program will get better results. We know that most of the homes were getting a 30% increase in energy efficiency. I think it is a valid question. Is that a good performance in relation to the inputs that go into that program?

    Madame Commissioner, I'd like it if you could comment on a couple of things. Frankly, we hear from the other party notions like, “We don't really need to be worried about greenhouse gases, because Canada is a bit player. What we should be doing is focusing on clean air.” Clean air, as you know, is a different scenario from greenhouse gases. They are interconnected somewhat, but they're totally different concepts.

    We also hear that maybe there are some sectors that have to contribute more. We've heard a lot about the automotive sector, about the transportation sector. Frankly, and I'm not getting into a partisan statement--well, I guess I am--I haven't yet heard the Minister of the Environment talk about the contribution of the oil and gas sector.

    It seems to me if we're going to deal with greenhouse gases in a real way we're going to have to get a contribution from the large emitters--the oil and gas sector, the manufacturing sector, the transportation sector--and citizens as a whole are going to have to try to change behaviour.

    I wonder if you would comment on some of those points. I'd be interested in your perspective.

    There's no silver bullet.

    One piece of information that is important is that in the overall plan that we audited, half of the reduction should have come through emissions trading. Emissions trading was a key component of greenhouse gas reduction. As I said earlier, it's still under construction.

    The other big chunk is really the transportation sector and the heavy industry sector. There again, as long as we don't have clear measures we won't be able to achieve the objective.

    You have three pieces there that have not been taken into consideration so far. So when you look at the target, it's hard to believe we were going to get there.

    With respect to the EnerGuide, your question will probably find an answer through the Treasury Board program review.

    Thank you, Mr. Cullen.

    From the Conservatives, Mr. Trost.

    I was just looking over this. Just to restate for the record, what years was this audit done for? What period were you covering in your audit?

    It's hard to say when exactly we started, because it depends on the program. Some programs started in 1997, so we looked back to 1997. It's easier to say that we closed the books in June 2006. Sometimes we were able to have updated information until 2006, sometimes 2005, sometimes 2004. Depending on the measures we looked at, we could have covered 2000, 2002.... Overall, I would say close to a ten-year period.

    But nothing prior to 1993. That would be correct to state.

    I look at your recommendations here. They're pretty basic, pretty simple: provide sustained leadership, integrate energy and climate change. There was a government that was in power that was supposedly committed to this for that length of time, and for a decade there was absolutely no leadership. That seems to be the absolute raw minimum of government.

    Do you not agree that leadership is one of the minimum requirements of any bureaucracy when dealing with this program?

    What you referred to are not my recommendations. They are, let's say, food for thought.

    You said there are five areas you believe are crucial.

    There are five areas of key importance, but these are not the recommendations. The recommendations are very specific, and the government has already responded to those recommendations.

    I think we're nuancing here. Basically the core lack at the top of everything was that there was no leadership for over a decade.

    Yes, but that's not a recommendation per se. It's a statement.

    That's an analysis, then. The basic analysis of the situation for over a decade was that there was absolutely no leadership by the previous government. It wasn't just the bureaucracy; it was the government itself, too, that showed no leadership regardless of the rhetoric, regardless of the statements, regardless of what has been claimed. I realize you're civil service; you're supposed to be there.

    I was just going to say, Mr. Trost, that at this point we're not really getting inquisitorial. We're just asking the--

    No, I was making a statement, Mr. Chair. I wasn't pushing for any response. I realize the civil service is good and non-partisan.

    You indicated you could fill the three minutes, and you have. At that point, I think you're out of time.

    Madam Gélinas, I'd rather go to the others, because we'll run out of time. You have made your point, and natural justice here is to allow the other parties to have their questions--

    But it's important to--

    --in the context. If you wish to get back to that, you can, but I'm going to go to the Bloc.

    Who would like to ask a question? Mr. Ouellet is next.

    Thank you, Mr. Chairman.

    I would just like to clarify one thing. I read somewhere here that the Kyoto Protocol includes a carbon exchange for emission reductions.

    In my opinion, no particular format is set out in the Kyoto Protocol. Every government decides how it wants to proceed in order to meet its targets under the Kyoto Protocol. In addition, the carbon exchange was an idea proposed by the Liberal Party. I am not saying whether it is good or bad. However, it has no connection whatsoever to the Kyoto Protocol. Very often we are told that the Kyoto Protocol includes that, but that is not correct. The Kyoto Protocol lays out targets.

    So, when I read that in your paper, it wasn't very clear. But that is not a serious criticism.

    In Chapter 4 of your report, on page 2, you say that, “Agriculture and Agri-Food Canada has made sustainable development principles a key component of its Agriculture Policy Framework.”

    Could you tell us in just a few seconds what they have done at Agriculture and Agri-Food Canada?

    If you don't mind, I'd like to ask Neil to answer that question.

    Certainly, Mr. Chairman.

    That was an example. One of the things we do when departments make commitments in those strategies is look to see whether they actually achieve them or not. That was one in which they fell short of what they intended to do, but we were quite complimentary in the report about the fact that in that department they've taken sustainable development and tried to implement it within all of the agriculture policies in the agriculture policy framework, so it was actually an example we used to show that sustainable development is working in some parts of the federal government.

    Madame Gélinas is next.

    Mr. Chair, I wish to correct something, because some people are putting words in my mouth that I haven't said. Nowhere in this report have we said that the previous government lacked leadership. We have made the comment that in looking forward, leadership will be needed if we are to achieve our Kyoto target.

    Thank you, Madame Gélinas.

    We're out of time on that one too.

    We'll now go to the NDP. Madam Bell is next.

    Thank you.

    I was looking at pages 12 and 14 regarding the wind power initiative, and I note that Environment Canada has maintained a wind atlas for over 40 years, which is quite a long time. I think the first time I visited a windmill in eastern Quebec was in the year 2000, so that's about six years ago.

    In your report you examine and evaluate the renewable electricity from wind power and you make some recommendations. Given that the funds for the WPPI program are frozen, and based on the Natural Resources Canada response to the recommendation 3.32, how does the frozen fund impact their ability to evaluate this program?

    I cannot answer that question, Mr. Chair. You will have to ask Natural Resources Canada that question.

    Good, and as I had said, Madam Bell, let's have a little bit of time at the end of the committee because we can follow up on those kinds of things.

    Do I have a bit of time left?

    Yes, you do, a couple of minutes.

    So the other part of it was that in the paragraph 3.27 recommendation it says that Canada should lead the development of wind power strategies for Canada in collaboration with the provinces, and we see that some of the provinces don't have any capacity at this point. Natural Resources have said that they would have a consultation and a discussion paper. Given that there is data available for a long period of time, is that adequate? Do you think that this discussion paper is adequate, given that you said that Canada must act quickly on climate change? There's a time-sensitive issue here. Is there the ability, based on all this information, to move forward in a more expeditious manner?

    This is one of many examples of where the government could move much faster. There is a lot of information available with respect to WPPI, and then it becomes a policy decision if the government wants to move ahead or not. Also, in the course of the audit we were told that some provinces are much more advanced than we are in developing wind power. So the federal government will have to adjust its approach to take into consideration that new reality of some provinces moving forward faster in the area of wind power.

    We've exhausted our time, and I hope we haven't exhausted you, Madam Commissioner, and your colleagues.

    I can go for another hour, if you want.

    I can see that. I guess it's us who are exhausted.

    We have run out of time, and we do appreciate your being here. The balance of the discussion, very quickly, is how we deal with your presentation here today. So I'm going to thank you and your colleagues on behalf of the committee, and I'm going to now take it back into the committee.

    Members of the committee, it seems to me, if I may, that there are a few obvious questions that are raised out of Ms. Gélinas's comments. I've just noted a couple of them. One was that question raised with respect to the response that was received from the Department of Finance on a petition. This is a citizen's petition. The commissioner is indicating concern about subsidies to the oil and gas industry, that she's not satisfied with the response. This is an example to me of what, in terms of closing the accountability loop, we really should act on. She's recommending that the committee may wish to get Finance Canada to clearly explain the extent to which the sector is subsidized.

    The other thing is that two questions were raised, and I think members have raised them. One was about what progress has been made in developing a system of collecting and reporting information on expenditures and results. Also, there was one about the review of climate change programs led by Treasury Board and how was it being shared horizontally across departments.

    I wonder if I could suggest this, if I may. My suggestion would be that we have our research meet informally with the vice-chairs and the chair next week, and if members wish to attend that, fine, but I'm going to, on behalf of the committee, ask research if they would go over Madam Commissioner's report and pick out those things that we could then look at for follow-up, and then ask the committee if they wish to do that.

    So I've given three examples to follow up, but it would be up to the committee. Is there any discussion on that?

    Mr. Cullen.

    I think that's a good idea, Mr. Chairman, but I think there are a couple of obvious witnesses that we should call. One is Finance Canada and the other is the Treasury Board.

    It's recommended right here.

    So I would suggest that we should just agree to invite them.

    A voice: Do you want to make a motion?

    Hon. Roy Cullen: They could come together in one panel, Finance Canada and Treasury Board.

    The problem is that it's highly irregular, with respect, that some of the members are not here. And my suggestion is that we would meet Tuesday, and we could come back with that report. We do have the oil sands deputations that have been confirmed that are coming, Mr. Cullen. I think it would give the opportunity for members to prioritize who we'd like to come in and give them some advance notice. I'm sure we could get into that. But I really would try to avoid, at this point, motions being put, because there was nothing on the agenda that was going to indicate that we would raise that here, in fairness. I think we can move expeditiously next week, since we have our agenda filled. Okay?

    Mr. Trost.

    Mr. Chair, this is just to say I think your idea is eminently fair. It also gives us a little bit of time to go back to rethink our notes, and so forth. I know I have scattered notes here, there, and everywhere.

    I'm just been informed—I forgot—that it's a break week next week. But we'll get on with it.

    In the next sitting week.

    We won't be here next week.

    Madam Bell.

    That was going to be my point.

    From past experience, we avail ourselves of the best advice we can take, and it's usually our research people who put that together for us. It will give our research a chance to digest what Ms. Gélinas has also raised.

    Madame DeBellefeuille.

    I agree with you, Mr. Chairman, on the idea of reviewing the follow-up. However, it seems pretty clear that some witnesses will have to be called, including officials from the Treasury Board and the Department of Finance.

    I would like to draw your attention to the fact that the Commissioner talked about sustainable development strategies. A report is planned, and those strategies will be evaluated.

    Since sustainable development has been identified as a topic for further study and we are looking for witnesses, if Committee members agree, I would like us to consider the matter of follow-up, which is related to a decision that has already been made with respect to sustainable development.

    I think the comments can be taken into consideration from our research and incorporated into the draft follow-up paper from the commissioner's report. I think that's what we want. We'd like something to work on.

    Mr. Cullen.

    I was just going to add—nothing that we have to worry about today—that if we are going to invite the Treasury Board Secretariat, we've already heard from some of the witnesses that there was a certain level of Treasury Board evaluation, and then there was a report that went to the cabinet. What we want to avoid is having the Treasury Board Secretariat come here, for example, to the committee to be told that they cannot discuss the report because it's a cabinet confidence. If that is the case, I would suggest we invite the minister as well.

    We'll take that under consideration, but I think research can help us. They have a little experience on this too.

    Mr. Paradis.

    I understand my colleague's point, and I agree with him. However, Mr. Chairman, I also know you plan to hold a prior meeting with researchers and all concerned, to avoid our being told that we should speak to this or that person. When the right people are here, we will get answers to our questions.

    Is my understanding of the process correct?

    No, I'm not suggesting, Mr. Paradis, that we should have any individuals in other than the members of the committee. I'm suggesting that to begin with it's the two vice-chairs and the chair to meet with research. Research now is looking at Ms. Gélinas' report to make some suggestions as to follow-up.

    We would present that to the committee at our first meeting, but it would be up to the committee still to decide. It may be obvious to us all that Treasury Board should come in and that there should be questions and so on. But I'm not presupposing that as chair on behalf of the committee; it's the committee that will decide that. I think you should have something in front of you, as research has digested this, as to who and what should be asked of departments, out of Ms. Gélinas' comments here.

    Ms. DeBellefeuille.

    Mr. Chairman, I would like a clarification.

    The Tuesday following the Parliamentary recess, we will be looking at a motion that was tabled today. Will we also be hearing from witnesses to talk about the tar sands project and look at a proposal to follow up on the Commissioner's report? Will we be doing all of that in the same day? Is that what I am to understand?

    No. We are having deputations a week Tuesday on our oil sands framework, as was agreed upon through committee at the last meeting. That is going ahead. And we will have the consideration of the motions. Those are separate.

    What I'm suggesting is that possibly a week from Tuesday, or even Monday—we'll have to see—the research staff will have had an opportunity to look at Madam Commissioner's report and to make suggestions to an informal committee, which I'm suggesting be the two vice-chairs and the chair, to review what the researchers are looking at in terms of follow-up and present it back to the committee.

    It will be an action plan, if you will, of Madam Commissioner's comments. There may be things that are missed by research; you can bring that up. My feeling is that there are some obvious things, but I'm suggesting on behalf of the committee that we don't get into a discussion of it but give research an opportunity to digest and then present some follow-up actions to us. It's up to the committee to decide whether they wish to follow those actions or suggest some others.

    We've heard this now; let's digest it. We have a week. We also have our agenda for a week in advance and we have the notices of motion. We have all kinds of work, but I think we also want to lay out our future initiatives in terms of closing the accountability loop with the commissioner's report.

    Mr. Cullen.

    With respect to the oil sands study, a number of lists were sent to you in terms of potential witnesses. Has that program been put in place, or will the committee have a final look at which witnesses we plan to summon?

    I'm going to have to ask the clerk if he would like to respond to that.

    The lists have been submitted to me. I have contacted the department to appear that week, as per the committee's recommendation.

    We have scheduled someone else for that week, but on that, I will be circulating a calendar, much as I did this spring, and the committee will be able to contact me and the chairman in the meantime to recommend that someone be added or taken away. There will be a calendar circulated.

    So there will be a calendar we can look at.

    Yes, absolutely. I'm working on organizing the puzzle right now.

    All right.

    Since it is 5:30 and there is no more business before the chair, we're adjourned.