I call this meeting to order. This is the 60th meeting of the Standing Committee on Finance. We are being televised.
Our orders of the day are pursuant to the order of reference of Monday, May 14, 2012. We are studying Bill .
Colleagues, as you recall, last night we were still discussing part 4 of Bill . This morning we are starting with division 3. Division 3 deals with PPP Canada Inc.
We have two officials with us here this morning for this division. We want to welcome them to the committee.
If either or both of you have an opening statement or an overview of this division, please go ahead, and then we'll have questions from members.
PPP Canada is a crown corporation mandated to lead the government sector to improve the delivery of public infrastructure by achieving better value, timeliness, and accountability to taxpayers through the effective use of public-private partnerships in Canada.
PPP Canada is incorporated under the Canada Business Corporations Act by order, by Canada Development Investment Corporation. By order it was made a parent corporation under the Financial Administration Act. At its incorporation it was decided to make PPP Canada Inc. a non-agent crown corporation.
Division 3 of the BIA confirms that PPP Canada does not act as an agent of Her Majesty, except for certain activities. It is proposed that PPP Canada be recognized as an agent of the crown for activities related to the P3 screen on federal capital projects and for the provision of advisory services to federal departments and crown corporations on federal P3s, acting as a source of expertise and advice on P3s for departments and crown corporations.
One of the things we've been hearing at this committee for a quite a long time is the fact that there are a lot of business dollars—about $500 billion was the figure that's been quoted to us—that are parked right now, that people are afraid to use. I presume it's because they're fearing another credit crunch from the banks.
This budget has been described by some as an austere budget. We have said that, perhaps, if the government had taken advantage of the low interest rates, with the bonds where they are now, and taken 10-year bonds, it could have started a program to revitalize the infrastructure in Canada. The Federation of Canadian Municipalities has said there's about $120 billion worth of infrastructure that needs to be done.
Would you see this organization taking part in something like that, should it happen?
I'm interested in a general recap of what's taken place up to now. I know this is included in the budget. But we had, of course, as Mr. Marston said.... In 2005, the Federation of Canadian Municipalities came out and said there was a $123 billion infrastructure deficit in the country left by some years of neglect by both federal and provincial governments in the past.
Of course, we came out with Canada's economic action plan in 2006 through 2009, a series of investments of $47 billion—$33 billion in infrastructure, along with many stimulus projects. Of course, that type of investment was geared so that it would be a tripartisan investment, looking for provincial and territorial governments, along with other parties, to invest. Municipalities put in a third, the federal government put in a third, and the provincial governments put in a third, in essence to cap up, to get us past the $123 billion and to try to recoup some of that.
I know the P3 projects had a late start in getting out, but we have had tremendous response from the FCM over our projects and over our investments. Have you seen the depletion of some of that desperate need that we had in 2006 when we took over as a government? Has that changed dramatically? Would you know of the inventory, of whether these projects have come forward?
I, myself, in northern Alberta.... We had a huge infrastructure deficit. We still have one in relation to our Highway 63 and other areas, because of the fast growth. But we have seen a tremendous investment by the federal government, almost somewhere around $800 million, in that area, over the last six years—provincial governments as well. We got our second, third, and fourth overpass in a number of years, which is great. And we've seen a bottleneck of infrastructure eliminated. Have you seen that across Canada as well?
Let me be a little clearer.
For example, my colleague was talking about the Pont Champlain. I'm from Toronto. We have a toll road in our city that was built as a P3 and has now become privatized. The biggest complaint we hear is about the rising fees on the toll road. So it's a different funding mechanism, as you say. If it had been built with public dollars—or maybe not, as we don't have public toll roads in Toronto—it likely would not have been a toll road.
So here's my question. When you're projecting costs and comparing bids as to whether something is or is not adequate for a P3 project, do you take into account the user fees, as opposed to having something that is built through public dollars and that would not require user fees? Are the user fees factored in as a cost in a P3?
There are many elements to your question.
In terms of comparing bids, typically a government would decide in advance whether it wants to have an asset tolled, for example, or to have some sort of levy that would be raised against its expenditures. Different bidders would propose a user fee or not, depending on their bid. Basically this is a government decision. The procuring jurisdiction would have to decide whether they want to have a certain asset being tolled or not.
In terms of whether a user fee is assessed as a cost to the project, it's more of a revenue source than a cost, so I'm not quite sure I understand your question.
If I understand it, I think it's the island of Guernsey—I'm not sure, but there's one particular island in the U.K.—that has Colas taking care of all of its road infrastructure over a 30-year or 40-year contract. They have tied it in for road infrastructure and also some public works. My understanding is that the performance currently versus ten years ago, before they took that contract, is dramatically different.
I come from, as I say, northern Alberta, where there are huge complaints about potholes because of frost heaving, etc. I understand, with the performance that is necessary with P3 projects on the accountability aspects of the contracts with the government, that the quality of the projects—I see you're nodding your head that you agree with me—and the delivery mechanisms, as well as the ongoing quality of the infrastructure, remain at a top level. Is that fair to say?
A key aspect of P3 is retaking the whole life-cycle cost of an asset. Let's say it's a road and it would be built to last for 40 years. The government is fully aware of what the costs are over 40 years and contracts out the maintenance of that asset over time.
What we see with traditional procurement is that sometimes the decisions are made more on the basis of short-term costs, actually building the road, and with less awareness of the cost of maintaining this asset over the long term. So sometimes, 10 to 15 years down the road, if finances are a bit tight, governments may decide to limit their expenditures on maintenance, and this can lead to the deterioration of the asset.
Basically, P3 aims at aligning the incentives in the right way in the interest of taxpayers. For example, when you ask a consortium that's going to be responsible for designing, building, and maintaining an asset over the long term, they can make decisions that will minimize their costs over the long haul.
When you ask an entrepreneur to build you a road and you award the contract to the lowest bidder, they will not propose something with concrete. It's very expensive and the entrepreneur is not responsible for the long-term maintenance of the asset, so they have no interest in proposing to build the road with concrete.
But if the bidding consortium is responsible for the long-term maintenance of the asset, they may see the economies of scale. The life-cycle costs will be lower than paving the road with a lower-grade asphalt and replacing it multiple times over the life of the asset.
We will set aside the issue regarding Champlain Bridge because, if my understanding is correct, you have not studied, or been given the mandate to study, this report.
Ms. Nash raised an issue I find very interesting. In your studies on PPPs, you can consider projects whose funding comes from the public sector. Is that right?
At this point I will thank our officials dealing with PPP Canada very much for being here.
We will ask the officials for division 4 on territorial borrowing limits to come forward. I know Mr. Marston has a line of questions on that.
For division 4 we have Mr. Macdonald, and we're on page 192 of the bill.
Welcome to the committee, Mr. Macdonald. If you want to give an overview of this division, then we'll have questions from members.
The Nunavut Act, the Northwest Territories Act, and the Yukon Act provide that territorial governments have the authority to borrow money for territorial, municipal, or local purposes subject to approval by the Governor in Council.
These identical amendments to the Northwest Territories Act in clause 214, to the Nunavut Act in clause 215, and to the Yukon Act in clause 216 provide the authority for the Governor in Council, upon the recommendation of the , to do two things: one, to set the maximum amount up to which each territorial government may borrow; and two, to introduce new regulations specifying the definition of borrowing and other instruments to be included for the purpose of the limit, entities whose borrowing is to be measured, and the value that should be attributed to each type of borrowing for the purpose of the limit.
As I said, the amendments to each of the three acts are identical. As stated in the budget on page 157, the intent of the regulations will be to ensure accurate reporting of obligations within these limits and to ensure consistency with reporting in the territorial public accounts. Establishing these clear rules will assist territories in their fiscal planning.
I will go through clause 214 for the Northwest Territories, just to show what's happening, and I will leave it at that, because they are identical for the other two territories.
Subsection 214(1) repeals the existing subsection 20(2) of the Northwest Territories Act. This is the subsection that currently authorizes borrowing by the territorial government if approved by the Governor in Council. The clause replaces the current language with a new subsection that specifies that the amount of all borrowings must not exceed the maximum amount that will be set out in a new subsection 20(4).
The new subsection 20(4) specifies that the Governor in Council may, on the recommendation of the Minister of Finance, set the maximum amount of the aggregate of all borrowings. This confirms the current practice of establishing maximum amounts by order in council on the recommendation of the Minister of Finance, within which territorial governments may make their own borrowing decisions.
Then the new subsection 20(5) creates a new power for the Governor in Council, on the recommendation of the Minister of Finance, to make regulations respecting borrowings, including regulations on what will constitute borrowings for the purpose of territorial borrowing limits, for what entities or classes of entities the borrowings must be taken into account, and the value that shall be attributed to each borrowing for the purpose of the limit.
The remaining clause, clause 217, is a coming into force provision.
That's an overview of the division. I'd be pleased to take questions.
Thank you, and welcome, Mr. Macdonald. I appreciate you being here.
I'm going to have a couple of comments, and it's not necessarily a question directed to you, so don't feel you have to jump in. I will get more specific at the bottom.
When we look at this action, one has to wonder why the Conservative government is changing the Constitution in these three territories to in fact increase control over the financial affairs of the territories, without public consultation, by putting it through Parliament in Bill . I said yesterday, when I was starting off prematurely, that it strikes me as not being consistent with the government statements that the fourth pillar of their northern policy is improving and devolving northern governance. In fact, the territories, from what I understand, are on record requesting the elimination of borrowing limit provisions. So, again, one might wonder why the Conservative government won't give the territories the same type of respect that they give to the provinces.
To my mind, these changes increase almost a colonial-style governance and control over the territories, and I'm left to wonder why the government won't accord the northerners the same kind of respect they do other provinces in the formation of this and the planning of this.
Was there a financial problem, a financial risk, or something that generated this, that you know of?
To respond to the specific question, I would point to the current language, just as an example, of the Yukon Act. So I'll sort of work from the bottom of your question and work back.
The current guidance that is provided for the administration of this federal authority, which has been in these acts and has been administered since, by my record, the 1980s, reads in its entirety, “No money may be borrowed under a law made under paragraph (1)(a) without the approval of the Governor in Council.”
The issue that arose that prompted a review of the operation of borrowing limits is twofold. Territorial governments are increasingly taking on larger, more ambitious, important projects, and they're looking to finance them in using instruments that have been developed over time. As both instruments and arrangements for risk sharing have become more sophisticated, there's not a whole lot of guidance in that line that I just read. So we started getting increasing questions, such as, if an arrangement looks like this, if a project looks like that, how would that be treated? As I said, there's not a lot of guidance there. The intent is to have clear rules. The territorial governments understand that clear rules facilitate clear fiscal planning. It's intended to clarify and to support decision-making by territorial governments.
With respect to how this is administered, I would make a general comment that the structure of the borrowing limit is to set a maximum amount within which territorial governments are completely free to take whatever decisions about how they allocate the free room that's left to them.
There's a parallel on the fiscal side with respect to the transfers that are provided by the federal government to the three territorial governments. They're quite significant in importance to the territorial governments. On the Finance website for the 2011-12 year, if you look at our website with respect to transfers to individual territories, it refers to how 67% of financial resources of the Yukon come from the federal government, 76% for the NWT, and 88% for Nunavut. The vast majority of that is territorial formula financing, and it's transferred unconditionally. The purpose of that money is to enable territorial governments to take the decisions they need to take to provide comparable programs and services, but we don't in any way look at—
If I may, I'll jump in just for a second. We travelled as a committee to Whitehorse last year, and in the north the cost of infrastructure is just huge. We understand the problems they have up there.
On the other side of it, I'm pleased to get your explanation of this because I think the federal government has a role to play, not necessarily in this fashion, but certainly a role to play financially, because those territories cannot manage or handle the costs they face with the roads or the telecommunications or hydro.
I presume I'm out of time.
The borrowing limit is reviewed upon request by a territorial minister of finance. The reason for that is it's left at an amount to ensure predictability for fiscal planning purposes. So you have an amount, it applies, and you know what it is. These are long-term projects we're talking about, so you need to know what your room will be for a very long term.
When a minister of finance applies to our minister for an increase, the analysis done is in keeping with the general approach to autonomy of the territorial governments to take the decisions they wish. We look at the general economic and fiscal outlook of the territorial government and its economy. We consult with territorial governments on what its forward-looking budget revenue stream is expected to be. We look at things like what interest rates are available or were available for existing debt of the territorial government, to get an idea of their ability to seek funds in the market.
What you're after is a general estimate of what the forward-looking ability of the territorial government, given its economic outlook, will be to carry a given amount of debt. There's a great deal of scenario analysis, as there are a lot of dynamic parameters in that. At the end of the day there is a decision taken about what a sustainable level will be.
There is a relationship, obviously, between a government's decision to take on debt and its ability to provide programs and services. Both of the territorial news releases actually acknowledged that link. They spoke to the importance of understanding that borrowing takes away from a government's ability to offer important programs and services and that they need to balance decisions taken today with the future.
That's, in essence, the intent of the analysis undertaken to arrive at a sustainable amount of debt servicing a territorial government can undertake. Given the Government of Canada's significant investment, through other transfers, in ensuring that territorial governments have the capacity to take decisions to provide programs and services comparable to those in the rest of Canada, part of the intent of the borrowing limit is to respect that balance.
I'm very interested in this. I'm a northerner as well. I've lived in northern Alberta my entire life, or pretty much, anyway.
One of the major complaints I've heard in my communities, which are mostly smaller communities, except for Fort McMurray, is that when they are applying for funds, it is very difficult to understand what people need. They can't hire a full-time person to fill out applications for federal government funding.
I see you nodding your head, so you understand that this is a common complaint.
Clearly, by changing the act to be more specific, I would suggest that there's going to be more certainty, less spinning of wheels, and indeed more effort put into things that will actually see a concrete and positive result. Would that be fair to say about applications in particular?
The legislation is not going to change the amount of funding received from the Government of Canada to territorial governments.
But I can observe that, as it's disclosed on the Finance Canada website, for example, if you're looking to territorial formal financing, I have figures here that read that in 2005-06, territorial formal financing was just over $2 billion to the three territories in total, and for the 2012-13 year it's $3.1 billion.
Are there any further questions on this division? Okay.
Mr. Macdonald, I want to thank you very much for being with us here today and responding to our questions very clearly. We appreciate that.
We will bring the next set of officials forward for division 5, “Reporting Requirements”, which is on page 194 of the bill.
We want to welcome you to our committee, and if you have an opening statement or if you want to give an overview of the division for the committee, we invite you to do so at this time.
I do have a statement to read, just to indicate in more detail what we're proposing. Before doing that, I'd like to provide some context. These proposals are part of a generalized review we've been undertaking within the Treasury Board Secretariat, looking at reporting requirements and trying to find ways to reassess them in terms of the resources that are put into creating them and to try to eliminate where it seems appropriate to do so.
There are three elements here.
The repeal of section 12.4 of the Financial Administration Act and section 28 of the Public Service Employment Act would eliminate the requirement for the President of the Treasury Board to table the annual report to Parliament on human resources management. Effectively, the report duplicates information that is available elsewhere in a number of sources, and therefore the cost of producing and tabling this report is no longer seen to represent an efficient use of resources. Also, the information that comes to Parliament is often out of date by the time it reaches Parliament, and it is available in a more accessible and timely manner through other vehicles.
The next element is that a new section 151 would replace sections 151 and 152 of the Financial Administration Act. It would create a report that consolidates the quarterly financial reports of crown corporations and provide regular updates on the tabling of their corporate plan summaries and annual reports in Parliament. It replaces effectively the annual report to Parliament on crown corporations and other corporate interests of Canada, which provides readers with information that is often outdated at the time of publication. The new reports would include information on the composition of government and the businesses and activities of federal crown corporations, and the President of the Treasury Board would make it available electronically to the public four times a year rather than once through the annual report.
Lastly, the repeal of section 8 of the Alternative Fuels Act would eliminate the requirement to produce an annual report to Parliament on the application of the act. This section is being repealed because the report presents the same conclusion every year, in effect, and has done so for quite some time, namely, that the use of alternative fuels is not cost effective and is only operationally feasible in select areas of the country. Because of its repetitive nature, the report is of limited use to parliamentarians and Canadians, and the effort required to gather and analyze the data to prepare the report represents again a substantial burden on departments and on the agencies to collect that information.
Those are the three elements. As I say, they represent three legislative changes we're seeking as part of a generalized review of reporting requirements. Again, the idea is to make information more readily available through other means and not to have information duplicated annually in this manner.
The source is the management accountability framework. It contains the information, which all departments make available on their respective websites.
The Clerk of the Privy Council's report to the Prime Minister, which is released every year, contains that information as well. There is also the Public Service Management Dashboard, which contains a lot of that information and can be accessed.
We're actually checking to see whether it can be accessed by the public. My understanding is that previously it could be, but this information is duplicated in a number of online vehicles, making this information more immediately available.
That's correct: information is available in one place.
The annual report was designed at a time when it was quite difficult to gather that information in an easy manner. Much of the information—in fact, all of it—now is available in a variety of online sources and can be made available, as I say, more immediately. So there's the accessibility question, but also, the annual reports tend to be a bit outdated by the time they're compiled and tabled. This would keep the information fresher.
No, it's not a goal that has been achieved, and the growing sense that it's not a cost-effective alternative means that it's going to be a very difficult goal to achieve over time, particularly given other alternatives.
Hybrid cars, for example, are not included in that definition of alternative fuels. They seem to be more cost-effective, in terms of the efficiency of the vehicles, and also the availability of alternative fuels is quite limited.
So this is a goal that is unlikely to be reached soon.
It is correct. At least the website says so, and so I hope so.
My understanding in relation to some of those vehicles, including hybrids, is that there are some reports out that indicate that the life-cycle cost of batteries is in fact much more worrisome—in landfills, etc.—than GHG emissions, so there is some dispute about whether hybrids would be more environmentally friendly than traditional automobiles or not. I know that automobiles today are 30 to 35 times more fuel-efficient and are more reductive of GHGs than they were 10 years ago, so we have come quite a way.
The definition of insanity is to do things over and over again with the same result. We've had this Alternative Fuels Act report over and over again, and it keeps coming up with the same result.
What would be the cost associated with producing a report like that? I know it's very difficult to itemize it, because each department collects the data and there must be a hundred people every day looking at the data they put into this report. But what would be the cost, in actual terms, that you're aware of?
The general review that I referred to at the beginning is part of an effort that recognizes that ultimately, in this instance, when the laws were put in place and the requirement for an annual report was included, it was at a time when it was quite difficult to obtain that information. To make it available, the annual report seemed to be the most convenient vehicle for doing so. But in an increasing number of cases now, that information is available online in a much more easily accessible manner.
This is trying to recognize that it seems almost artificial to keep producing an annual report when the information is both relatively stale by the time it's compiled but is also much more instantly available through other vehicles.
But, again, we will make sure that those locations, if you like—we are talking about websites—are made available, so that there's clarity around precisely where the information is found.
Again, our view is that the information provided is ultimately to help decision-makers make decisions, and in many cases we've found that because the annual reports contain old information, they're not that useful for decision-making purposes.
One other element I would suggest, and I'll use these three as examples, is that in general the annual reports provide information in segments.
I think the benefit of having online information, in addition to it being easily accessible, is that it helps consolidate information so that decision-makers are able to look across ranges of information, as it's integrated and consolidated in ways that annual reports sometimes don't permit.
Again, if we're talking about the ability for parliamentarians and decision-makers to use that information to make decisions, our sense is that the annual report is not necessarily always the best vehicle, at least in these cases.
Actually, the July 31 date was an arbitrary deadline that was set, asking crown corporations to report up to that period.
You'll notice that there was another amendment, a technical change in that section where we replaced “fiscal” with “financial” year. I guess that was to correct a legal error when the legislation was first introduced. Crown corporations operate on financial years that are not always aligned with the Government of Canada fiscal year. There was some confusion on the reporting period, given that crown corporations have different financial years, with some ending in December and some ending in July. What was effectively happening with the annual report with this July 31 deadline was that sometimes you would get information that was 18 months out of date by the time the report was tabled.
We are proposing that because the crown corporations already have an existing legislative requirement to produce quarterly financial statements, those would be consolidated on a quarterly basis, thereby removing that reporting timeline. The idea that we're introducing reporting “as soon as feasible” is to recognize that at every quarter, crowns have 60 days to make their information public. Once the Treasury Board Secretariat receives that information, we will compile it as soon as possible after that 60 days, consolidate it, and make it publicly available.
It also recognizes that as we're moving to more modern, accessible, online formats, the time it will take to consolidate these reports may get shorter over time. As it stands, it takes about 60 days for the Treasury Board to produce these annual reports to consolidate all the information. We're hoping this will be expedient.
Is there anything further? Do any other members have questions? No.
I want to thank our officials for being here, and thank you for responding to our questions very clearly.
We'll bring the next officials forward for division 6, “Social Security Tribunal and Service Delivery”. For your reference, this is on page 196.
I want to welcome you to the committee.
If you have any opening statement or if you want to give an overview of this division, please do so now, and then we'll have questions from members.
Division 6 amends the Human Resources and Skills Development Act as well as the Canada Pension Plan, the Old Age Security Act, and the Employment Insurance Act to create a social security tribunal, which will replace four existing tribunals that hear appeals related to the three programs I mentioned.
Division 6 also introduces a new part to the Human Resources and Skills Development Act related to the provision of electronic services. This is not related to the social security tribunal changes; they are separate provisions. The electronic services provision is intended to provide the department with the authority to expand the provision of our services to an electronic environment, and to do so in a way that is consistent across the three programs, those being the employment insurance program, the Canada Pension Plan, and the old age security program, in addition to grants and contributions that are provided under the same department.
This means that although with the employment insurance program we are well advanced in the provision of our services to an electronic environment, we are moving toward this transformation in the pension world, specifically related to the old age security program right now. Our service improvement strategy is focused largely on moving these programs away from the paper-based environment that we currently work in to an automated world where we can use electronic signatures and electronic identity verification. So the intention is to ensure that as we expand the transformation of our electronic service provision, we do so in a very integrated and interoperable way.
For example, when we do identity verification in the Canada Pension Plan, we would take the same approach we do with employment insurance or the old age security system. That's the electronic services provision, which is created through the addition of a new part 6 to the Human Resources and Skills Development Act.
Back to the tribunal, which is the more significant change in division 6. Division 6 introduces a new part 5 to the Human Resources and Skills Development Act, as I said. The first two clauses have various sections in them that create the social security tribunal, outline its structure, how its membership will be organized, how members will be appointed to the social security tribunal, the administration of the tribunal, the function of the SST, and a number of regulatory authorities associated with the tribunal.
When you look at this section in the legislation, it's interrupted by the electronic services piece. First we have the amendments to the Human Resources and Skills Development Act for the social security tribunal, which is part 5 of our HRSD act, and then it introduces part 6 for the electronic services I just explained. Then it introduces a number of amendments to the Canada Pension Plan, the Old Age Security Act, and the Employment Insurance Act, which are related to the social security tribunal amendments, which are introduced in the new part 5. So it is a little difficult to navigate through this piece and see how they all link together.
Clauses 225 through 250 are the amendments related to the social security tribunal for the three programs I mentioned. Then we have transitional provisions, which outline how we will move from the existing program under the existing four tribunals that hear appeals to the one tribunal, which will start hearing appeals on April 1, 2013.
After that you have a number of clauses that introduce consequential amendments flowing from the social security tribunal to other pieces of legislation that currently mention one of the four other existing tribunals. So it is just moving the mention of the particular...for example, changing the Pension Appeals Board to make reference to the social security tribunal.
That is the overview of the changes contained in division 6.
In a previous life I was one of the people who helped select nominees for the labour position on the EI boards, so I have a particular interest in this.
Currently, you have Canadians who appeal departmental decisions, either EI or CPP or OAS, to separate tribunals, as you've indicated. My figures here said that last year the EI tribunal heard 27,000 appeals and 1,800 further appeals to umpires. The CPP and OAS tribunal heard 4,500 appeals. There are 900 members who hear the cases at the EI tribunal alone and the government wants to fold them together with just 74 full-time members and the backup of 11 part-time.
What commonalities do you see between these groups, the EI, CPP, and the OAS, that justify a joint tribunal?
I just want to clarify a couple of things. I very much like the idea in terms of combining. You mentioned April 1, 2013. That's when the new tribunal will be up and operating, correct? I think probably the only concern one would have on this is the transition period between them coming together. Can you just address that?
Exactly how are you going to do the transition to ensure that it is seamless, so that for people who have something currently in the process when that switchover happens, it will be seamless for them?
Thank you, Mr. Chair, and I appreciate the chance to get back in.
One of the concerns I have, having seen or at least spoken to people we've had as referees before, is the importance of having that face-to-face contact. I know video conferencing supplies a method, but the face-to-face, where things are drawn out in a different fashion, give a better understanding: do you believe the person or do you not believe the person when you're face to face? I'm really concerned about that. And I'm concerned about the changes to regional access.
Beyond that, you have a situation where, if there are so few people and it's more concentrated, for lack of a better term—understanding the region and understanding the diversity of our country—this has the potential to create problems. We hear the minister talking about changes to EI and accessing EI, and I won't get into the controversy over the things that have been said on that, but based on the changes that appear to be before us on EI, I think there will be an increase in appeals. They've said they're going to restrict transfers to the areas people live in, and if there's no work in that area, what's going to happen? If a person refuses to go, what's the potential for appeal? I think this is problematic. With so few adjudicators, do you have a set of parameters you think will be used? Are you aware of any parameters of expertise and background that will be used?
Part of the proposal is that by there being full-time members, fully engaged in hearing decisions, particularly at the general division level for the two different sections, this will also be of benefit to clients, because they will get clearer decisions from experts who understand the programs. Therefore, I think that in addition to the obvious administrative efficiencies that are associated with streamlining the program, clients can also be assured that the individuals who are hearing their cases are well familiar with any changes.
These programs are like living trees; they change all the time. So you're right, keeping the part-time members fully abreast of the constant policy changes that are happening in the program is a challenge. It's a challenge to keep them up to speed, but with full-time members, they will be constantly experiencing cases associated with the policy as it evolves.
I didn't mean to suggest that the existing tribunal members are not trained.
What I thought I said was that it's difficult for them to be constantly abreast of the constantly changing policies associated with these three programs, and particularly with the employment insurance program, which is, as you know, a labour market program and needs to be extremely adaptable to the ever-changing and broad labour market program.
So on the employment insurance side, we actually provide something like a hundred annual information sessions to board or referee members who attend these sessions. They are trained. As soon as the legislation changes, the information sessions are updated to provide an overview of the training. They're also provided with training on jurisprudence that is coming through the system that they may not otherwise be aware of. So yes, they are very well trained. They are giving fair decisions, but they do it part time.
Mr. Chair, my colleague and I are very happy to be able to appear before the committee this morning to talk about projections regarding privacy.
The Budget Implementation Act will result in the merging and harmonization of the five privacy codes our department currently has. The privacy codes are there to protect private information under the department's responsibility. One of the things those codes specify is when and how that information may be shared. This protection goes beyond basic measures provided for in the Privacy Act owing to the extremely delicate nature of the information we gather.
So this information goes beyond the protections of the Privacy Act. The amalgamated privacy code, which is proposed here, uses mainly pre-existing provisions from five different acts, and this code reinforces the fundamental value that a citizen's personal information is privileged.
It will greatly streamline departmental activities and will provide a consistent approach. It will also improve the integrity of our programs. For example, the privacy code currently allows for the disclosure of personal information with other countries for the administration or enforcement of Canadian law under agreed upon conditions and where the minister considers it advisable. This has been possible for the employment insurance program.
By bringing all the programs under the same code, this will allow us to pursue stronger integrity for the Canada Pension Plan and old age security. As I said, this mainly uses pre-existing provisions from different acts. It appears to add a lot of new text, but the new text is appearing new in the departmental act and is coming from other statutes.
One thing that is made more clear with these amendments is that the departmental act will be amended to make explicit our authority to disclose information to provinces in support of provincial activities, subject to conditions and the prescription of the provincial activity in regulations. This change will ensure that operational needs of provincial programs and services will be met and will support work on important federal and provincial files such as labour market development agreements.
Additionally, authority to disclose information contained in the social insurance registry will be moved from the Employment Insurance Act and the Privacy Act into the Department of Human Resources and Skills Development Act. This will enhance privacy protection by ensuring that such information is governed by the same privacy requirements and safeguards as are other HRSDC programs.
We're very happy to talk about the provisions in the act.
I believe the question has two parts. I'll deal with the second one first.
We did consult the Office of the Privacy Commissioner. The code, which is contained in the departmental act, actually dates from several years, and the Office of the Privacy Commissioner was consulted at the time.
In bringing forward this harmonization, we have consulted the office again. They have not raised any specific concerns with respect to the harmonization we're proposing.
I believe the first part of the question dealt with how CPP and OAS are being folded into this. You're right; since this is a harmonization, this does not show the sections of the act that are already there. What this does is it essentially takes pieces out of the CPP and the OAS Act, move them into the departmental act, and harmonize them all together, which has the result of ensuring that that code applies consistently across our programs.
There are no further questions on this division, so I want to thank you for being with us today and for responding to our questions.
We'll now call the next set of officials for division 8, “Social Insurance Number Cards”. That's on page 235 of the budget.
Do you have a point of order, Mr. Hoback?
This particular division of the bill runs from clause 304 to clause 314.
In the context of the presentation you just heard from my colleagues about moving various pieces of the EI Act into the departmental act, the text you see in these clauses reflects that move because it is happening at the same time; it makes some additional changes to some of that text to deal with the social insurance number card. It's been proposed to eliminate the production and issuance of the social insurance number card as of March 2014, so we would stop printing the card at that point. This would yield savings in the range of $1.5 million.
Fundamentally, we don't require the card for service delivery. It's the number that is the key piece within our service delivery framework. The card is merely a reminder of that number, so as of March 2014 we'll be replacing the card with a letter, which is more efficient and easier for us to print.
That's the main piece within this section. There are also some consequential changes to some other pieces of legislation relating to the Wheat Board, the Farm Income Protection Act, the Immigration and Refugee Protection Act, and the Wage Earner Protection Program Act because they all make mention of the card. So those changes are strictly to reflect that.
Clause 307 talks about money, and it merely maintains the source of funding for the social insurance register and card, the program around the social insurance number. It maintains the status quo from what was before, recognizing the change in the act.
There's also a consequential change in the Canada Pension Plan Act, as it also makes reference to the card and actually requires the card to be presented to an employer within 60 days. So that has been changed to say that the number must be given to the employer within 60 days for the employer to then report it on the various documents on which they are required to do it.
At high level, that is what this section is proposing.
Yes, this is an existing provision, so this doesn't change because of this amendment.
The commission is able to make information available for the purpose of effective identification of the client and for the effective use of the social insurance number. Those are two terms that give the high-level guidelines, and then any decision the commission makes is also guided by the lesser legislation that they talked about previously around privacy, the Privacy Act, as well as a number of other acts of Parliament that provide authority for that particular program to use the social insurance number. For example, the Income Tax Act authorizes CRA to use the social insurance number, and therefore disclosing that information to CRA for those purposes is allowed under the act. So it's in that way.
The social insurance register does exist. It was created in 1964, when the social insurance number was originally created. That does not change in this amendment. That is very much the status quo.
I don't have an exhaustive list here, but the information contained in that register is obviously the name, the address we sent the letter or card to, the date of birth, gender, and those sorts of pieces. As well, there a few administrative things, such as whether the person has been declared dead or whether they've not used it in several years. A lot of administrative flags are also in there.
That's the nature of the information in the register, and it has been for many years.
In fact, on the Service Canada website, under the heading “Social Insurance Number”, there are, in fact, a couple of booklets. One is specifically on protecting your information, and one is a code of conduct, we call it. It's not just about how individuals are supposed to use social insurance numbers but also about how businesses and government should use the social insurance number. It recommends that people not carry it in their wallets. A safety deposit box is a good place for it.
Don't give it to someone unless you actually need to. For example, if you're applying for EI, you must provide it, because that's what it's for. You hear a lot of examples of people being asked to give it for renting a house or for getting a card to rent a video at your local store. I guess we don't do that anymore. Those are not the reasons for which the number was created, so we advise Canadians to be cautious about using it in that way.
That information is readily available on the website.
It's one of a variety of considerations that we've taken into account. It is an initiative that's been discussed in the department for quite some time. More and more we recognize that the physical card is not required in order for us to do our business or for other government departments to do their business. So phasing it out, in that context, makes a lot of sense.
Identity theft is also a consideration. It's not the only one. But a department such as HRSDC is very attuned to the privacy of personal information, as my colleagues were just saying about the changes to the privacy framework for the department. Safeguarding that personal information is a prime concern. Anything we can do to reduce the opportunities for identity theft, the better. This is one of the reasons we encourage people not to use the card inappropriately. The more widely the number becomes available, the more likely that someone will be able to take advantage of it.
When you issue a card, people come to rely on it as a piece of identification, a document. We do not encourage the use of the card as an identity document. It has no security features on it—no picture of the holder, no fingerprint, no retinal scan.
Good morning. My name is Margaret Strysio, and I'm responsible for strategic planning and reporting at Parks Canada. I'm joined this morning by Jonah Mitchell, who is responsible for law enforcement.
Division 9 of the bill proposes changes in two areas for Parks Canada. The first relates to collaboration on environmental enforcement activities, and this is covered by clauses 315, 316, 322, and 323. Mr. Mitchell will take the committee through those clauses, and then I'll speak to the remaining clauses that deal with the streamlining of planning and reporting.
For context, the enforcement activity of park wardens is limited to the agency mandate for national parks, national historic sites, and national marine conservation areas.
Clause 315 would allow for park wardens to assist other ministers to enforce their acts and regulations outside of parks and sites with the following constraints: the act or regulation must relate to the environment; the act or regulation must be listed in the schedule to the Parks Canada Agency Act; the location of the enforcement activity must be such that it is more convenient and efficient for park wardens to respond than other federal enforcement officers; there must be an agreement to provide these enforcement activities on behalf of the other minister; and park wardens must be designated and trained to enforce the other act.
Essentially the intent of the change is to allow for a faster and lower-cost response to environmental enforcement incidents, particularly in remote areas in the north where Environment Canada does not have an ongoing presence, but Parks Canada has a park warden nearby who could act on its behalf.
Clause 316 allows the Governor in Council to add acts and regulations to the schedule of the Parks Canada Agency Act for which park wardens could assist other bodies in enforcement activities.
Finally, clauses 322 and 323 restructure the schedules of the act to add part 3 and part 4 for the listing of the associated regulations.
I'll deal first with clause 320, because clause 317 is consequential to it.
Clause 320 removes the requirement for Parks Canada Agency to prepare a corporate plan and annual report by repealing sections 33 and 34 of the Parks Canada Agency Act. As a consequence, clause 317 would remove the reference to the corporate plan in subsection 21(3).
These documents duplicate the information in the report on plans and priorities and the departmental performance report that Parks Canada must produce each year because of where it is placed on the schedule under the FAA. We will continue to do the departmental performance report and the report on plans and priorities each year, but the duplicated report will be removed.
Moving to clause 318, this amendment would extend the timeline for the preparation and tabling of a report on the overall state of our parks and sites from every two years to every five years. Changes to the overall state of our parks and sites, things like ecological integrity, commemorative integrity, take longer than two years in which to see an appreciable change. A five-year timeframe is much more appropriate and will allow for a more meaningful report and more analysis in terms of trends, etc.
Clause 319 would extend the timeline for the review and tabling of management plans for each national historic site from five years to at least every 10 years. Management plans are long-term strategic plans with a 10-year to 15-year time horizon. They set out the vision, key strategies, and long-term objectives for the place related, for example, to natural resource management, cultural resource management, visitation, and stakeholder relations. Ten years is a more appropriate timeframe and will allow us to focus on implementing the plan over that time, to work with our stakeholders in implementing the plan, and move towards those long-term strategic targets we've set out in the management plan.
This changed timeframe is reflected through an amendment to the Parks Canada Agency Act for historic sites.
Clause 324 includes the same changed timeframe for management plans in the Canada National Parks Act for national parks. Clause 325 makes the same change to the Canada National Marine Conservations Area Act for marine conservation areas.
Finally, clause 321 removes the requirement for an annual audit of Parks Canada financial statements and an annual review of its performance information in its annual report. This would be through repealing section 36 of the Parks Canada Agency Act. We would continue to report on our performance annually through the departmental performance report, and our financial statements would continue to be completed and made public via a link to the departmental performance report. There would no longer be the Auditor General's audit of the financial statements.
This item was already raised in division 1 of part 4 of the bill. A number of organizations are having the same types of changes made by the Office of the Auditor General, and I think that was discussed last night.
No, it will not have an impact on the opening season or the seasons of our parks. This is solely for enforcement-related activities.
A good example would be in the Gaspé Peninsula, where there are a couple of migratory bird sanctuaries,
especially Rocher-Percé and Île-Bonaventure,
and Environment Canada's enforcement officers respond to those locations from Quebec City. We have a small number of park wardens who do enforcement in Forillon National Park. It is much closer in terms of travel distance for our wardens to have authorities to respond to enforcement incidents in those migratory bird sanctuaries on behalf of Environment Canada. That's probably the best example.
This doesn't have an impact on other parts of Parks Canada's operations, like the visitor services, the campgrounds, the—
Certainly I appreciated that very specific example. Having done work in remote locations, I can remember a health nurse for the federal government doing immunizations and having to drive four hours to immunize one baby. It always seemed like such a terrible waste of time and resources. So I really appreciate this move, in terms of a little bit more flexibility with the role.
Just to clarify, this would only relate to federal statutes and enforcement, or have there been conversations in terms of some opportunities for provincial collaborations?
I want to thank our officials from Parks Canada for being here today and for giving an overview of that division. We appreciate your time with us.
Colleagues, we did divisions 10 and 11 last night, so we will be moving to division 12, on the Integrated Cross-Border Law Enforcement Operations Act.
With us we have Joe Oliver—the real Joe Oliver.
Voices: Oh, oh!
The Chair: To address this, we have Mr. Oliver from the RCMP.
Mr. Oliver, if you want to give an overview of this division, then we'll have questions from members.
Joe Oliver of the RCMP will be joining us momentarily, when he gets through security.
I'm here to speak to the Shiprider operation part of the BIA. Division 12 of the BIA is required to implement regular Shiprider operations between Canada and the United States. Shiprider enables specially trained and designated Canadian and U.S. law enforcement officers to conduct seamless, continuous law enforcement operations across the border on shared waters. This new and innovative cooperative policing model not only leverages law enforcement resources more efficiently, but has proven to be a more effective method of detecting and interdicting cross-border criminality.
Just to give you a sense of it, the idea is that there would be police law enforcement vessels in shared waters on the Canada-U.S. border, and they would be jointly crewed by Canadian and U.S. law enforcement. It's very important to note that all Shiprider operations will be conducted under the direction and control of law enforcement officers of the host country, so in Canada under the control and direction of Canadian law enforcement, and in Canada it would be conducted in accordance with Canadian laws, policies, and procedures, and the same on the U.S. side.
Looking at some of the key elements of this legislation, the act would define the scope of operations for Shiprider; specify the authorities being granted to designated officers; outline the role of the Canadian central authority, which would be responsible for managing the day-to-day operations; specify the appointment process, including the mandatory criteria for appointment; outline how the seizure of goods and detention of persons are to be managed in Canada; and establish a civilian oversight mechanism for the conduct of designated officers.
Legislation seeking to implement Shiprider has twice been introduced to Parliament, the latest being former Bill , which died on the order paper when Parliament was dissolved in March 2011.
Regularizing Shiprider operations will permit the government to realize one of the key law enforcement commitments in the Beyond the Border action plan between Canada and the United States. Importantly, it would also allow Canada to ratify the Shiprider framework agreement signed by the public safety minister and the homeland secretary back in May 2009. With this legislation in place, it is hoped that regular Shiprider operations could be implemented this summer.
This is the mounted cavalry riding in. This is my colleague, Joe Oliver, director general, border integrity, RCMP.
I think it's important to recognize that today the RCMP conducts on-water operations in shared waters with the United States. Because law enforcement in Canada and the U.S. respect jurisdiction, our ability to pursue criminals across the border is limited by the fact that we are empowered under Canadian law and not U.S. law. As a consequence, there have been instances when suspect vessels we have tried to intercept have fled into U.S. territory and evaded apprehension.
Even with our existing resources today, this bill will give us the legislative authority to jointly crew vessels with specially trained officers from Canada and the U.S., so that the border will not be a barrier to current cross-border law enforcement operations. Even in the absence of dedicated funding for this type of activity, we currently conduct operations, and those operations would be enhanced by this increased operational flexibility. We will be operating with our American counterparts across the border. In fact, we would leverage each other's finite resources to bring better effect to cross-border crime-fighting, both in Canada and the U.S.
Perhaps I could speak to that.
I think what we've done with the Shiprider framework agreement.... It was one of the first times we tried this innovative law enforcement practice along the Canada-U.S. border, so we were mindful of concerns that may have been raised around sovereignty and so forth. To mitigate that, and to test the concept, the first deployment of this was in the maritime environment, which is a very clearly defined boundary. We limited it to the U.S. Coast Guard and the RCMP in order to....
We're talking about the integration of operational cultures, operational standard procedures, training and so forth. It was tested, it was evaluated, it was improved, and then it was tested and evaluated to the point that both governments saw value in this as an innovative law enforcement practice that would increase the crime-fighting capability of both Canadian and U.S. law enforcement entities.
Now, based on the lessons learned from Shiprider, there is a commitment in the beyond the border action plan to follow how Shiprider evolved and bring it to the land environment and test it there as well. In the Beyond the Border action plan a commitment is made by the governments of Canada and the U.S. in terms of testing this concept in the land environment.
We visited Windsor, as a committee, and we had discussions with Canada Border Services Agency about chases, at times, that occur across the bridge.
Just so I understand clearly, the things that are being considered in the future would be a joint force that would have the capacity to go past the gates of the bridge, for instance, into Canada if they were in pursuit?
I don't think the concept is that clean.
I think what we have to look at, particularly with respect to Shiprider.... We know what it does; we've deployed it and we know how it works.
In Shiprider, it's a planned operation, in most cases, where officers from both countries are cross-designated and they are co-crewed. A key element of the Shiprider framework agreement in the legislation itself is that this has to be an integrated maritime law enforcement operation on a jointly crewed vessel, with cross-designated officers who have received special training. It is very much built on the fact that sovereignty still applies.
When in Canada, Canadian laws still apply; it's just that the U.S. officers are now acting in Canada under the direction of Canadian officers, and they're essentially backup to the Canadian officers. If there's a situation where Canadian officers are in U.S. territory, they're actually acting as U.S. officers, supporting the U.S. lead law enforcement agency.
Correct. And that is why, if you look at the legislation, it confines us to the maritime environment. The framework agreement specifies that there are only rare instances when a pursuit can be continued on land.
That might be a situation where surveillance commenced in the United States, the vessel was followed into Canadian waters, it hit the shore, and the suspect fled. Then the Shiprider officers would have the authority, in those very rare instances, to continue the pursuit on land, but they must coordinate with the on-land or Canadian resources.
Now, based on the construct that we have, where you have three RCMP officers and one U.S. Coast Guard officer, the decision may be made by the lead Canadian officer that the U.S. Coast Guard officer stays with the vessel and the RCMP officers, who have full authority in Canada, would continue with the foot chase.
Those are things that are being worked out in the important part, which is the training, where these scenarios are actually practised time and time again for these officers so that it becomes ingrained in how they do business when they work together.
The framework agreement provides for the opportunity for air officers or air observers to be cross-designated. I think the important element to understand about this aerial support—and it is only support, since they are not involved in direct law enforcement—is that they essentially become the eye in the sky for the vessels that are on the water.
If you look at certain areas along the border, there are a number of small islands where suspects could easily hide and fall out of the line of sight of a vessel working on the water. Having aerial support would provide the opportunity for the air observer to direct officers to wherever the suspect has fled.
Another important element is that any operation conducted in Canada must be under the direction of a Canadian officer and consistent with a constitutional framework in Canada as well as with the legal requirements in Canada.
I want to pick up on what I was asking you about earlier.
The budget implementation bill will establish the new Framework Agreement on Integrated Cross-Border Maritime Law Enforcement Operations.
You told us there are no financial implications. This is the Standing Committee on Finance, but I appreciate this was the government's decision. Nevertheless, since this is such a key part of public safety, can you tell me whether you appeared before the public safety committee to discuss the Shiprider program?