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37th PARLIAMENT, 2nd SESSION

Standing Committee on Public Accounts

EVIDENCE

CONTENTS

Monday, February 3, 2003

1535

The Vice-Chair (Ms. Beth Phinney (Hamilton Mountain, Lib.))

Mr. Philip Mayfield (Cariboo—Chilcotin, Canadian Alliance)

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau (President, Canadian Space Agency)

The Vice-Chair (Ms. Beth Phinney)

Mr. Richard Flageole (Assistant Auditor General, Office of the Auditor General )

1540

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

1545

1550

The Vice-Chair (Ms. Beth Phinney)

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

Mr. Marc Garneau

1555

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

The Vice-Chair (Ms. Beth Phinney)

Mr. Odina Desrochers (Lotbinière—L'Érable, BQ)

1600

Mr. Marc Garneau

Mr. Odina Desrochers

Mr. Marc Garneau

Mr. Odina Desrochers

Mr. Marc Garneau

1605

The Vice-Chair (Ms. Beth Phinney)

Mr. Steve Mahoney (Mississauga West, Lib.)

Mr. Marc Garneau

1610

Mr. Steve Mahoney

Mr. Marc Garneau

Mr. Steve Mahoney

Mr. Marc Garneau

1615

The Vice-Chair (Ms. Beth Phinney)

Mr. Steve Mahoney

The Vice-Chair (Ms. Beth Phinney)

Mr. Pat Martin (Winnipeg Centre, NDP)

Mr. Marc Garneau

Mr. Pat Martin

Mr. Marc Garneau

1620

Mr. Pat Martin

The Vice-Chair (Ms. Beth Phinney)

Mr. Pat Martin

Mr. Marc Garneau

Mr. Pat Martin

The Vice-Chair (Ms. Beth Phinney)

Mr. Pat Martin

Mr. Marc Garneau

Mr. Pat Martin

The Vice-Chair (Ms. Beth Phinney)

Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby, Canadian Alliance)

Mr. Marc Garneau

1625

Mr. Paul Forseth

Mr. Marc Garneau

1630

Mr. Paul Forseth

The Vice-Chair (Ms. Beth Phinney)

Mr. Mac Harb (Ottawa Centre, Lib.)

Mr. Marc Garneau

1635

The Vice-Chair (Ms. Beth Phinney)

Mr. Roger Gaudet (Berthier—Montcalm, BQ)

Mr. Marc Garneau

Mr. Roger Gaudet

Mr. Marc Garneau

1640

Mr. Roger Gaudet

The Vice-Chair (Ms. Beth Phinney)

Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance)

Mr. Marc Garneau

Ms. Val Meredith

Mr. Marc Garneau

Ms. Val Meredith

Mr. Marc Garneau

1645

Ms. Val Meredith

The Vice-Chair (Ms. Beth Phinney)

Ms. Val Meredith

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Richard Flageole

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Philip Mayfield

Mr. Marc Garneau

1650

Mr. Philip Mayfield

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Jacques Bruneau (Senior Financial Officer and Director, Corporate Management, Canadian Space Agency)

Mr. Philip Mayfield

Mr. Jacques Bruneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Steve Mahoney

1655

Mr. Marc Garneau

Mr. Steve Mahoney

Mr. Marc Garneau

Mr. Steve Mahoney

Mr. Richard Flageole

The Vice-Chair (Ms. Beth Phinney)

Mr. Philip Mayfield

Mr. Richard Flageole

Mr. Philip Mayfield

1700

Mr. Richard Flageole

Mr. Philip Mayfield

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

Mr. Marc Garneau

1705

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

The Vice-Chair (Ms. Beth Phinney)

Mr. Steve Mahoney

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Ms. Val Meredith

Mr. Marc Garneau

Ms. Val Meredith

1710

Mr. Marc Garneau

Ms. Val Meredith

Mr. Marc Garneau

Ms. Val Meredith

Mr. Marc Garneau

Ms. Val Meredith

The Vice-Chair (Ms. Beth Phinney)

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

Mr. Marc Garneau

Mr. Philip Mayfield

The Vice-Chair (Ms. Beth Phinney)

Mr. Richard Flageole

1715

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

Mr. Marc Garneau

The Vice-Chair (Ms. Beth Phinney)

CANADA

Standing Committee on Public Accounts

NUMBER 010

2nd SESSION

37th PARLIAMENT

EVIDENCE

Monday, February 3, 2003

[Recorded by Electronic Apparatus]

¹ (1535)

[English]

The Vice-Chair (Ms. Beth Phinney (Hamilton Mountain, Lib.)): Ladies and gentlemen, I call the meeting to order. This is meeting 10 of the Standing Committee on Public Accounts, Monday, February 3. Pursuant to Standing Order 108(3)(e), we are considering chapter 7, “Canadian Space Agency--Implementing the Canadian Space Program”, of the December 2002 report of the Auditor General of Canada.

Before I start the meeting, we have three guests I would like to introduce. There's Mr. Nic Isaacs, Deputy Speaker of the Western Cape Provincial Parliament in South Africa; and Mr. Archie Lewis, Western Cape Provincial Parliament in South Africa; and Mr. Mario Sassman, senior committee coordinator. Welcome to our meeting.

Now I would like to introduce our witnesses today. The first two, from the Canadian Space Agency, are Marc Garneau, the president, and Pierre Richard.

I would just like to make a comment before we start. We understand how busy and difficult your weekend has been. This meeting was already booked. It's something we planned ahead of time, and we appreciate very much you taking the time, particularly right now, to come here.

We want to give you our condolences. We know how all of you in the space program are very close and how difficult this must be for you. So again, thank you very much for coming.

I would like to allow Mr. Mayfield to say a few words on behalf of the opposition, and then each one of you will have a chance to say something a little later, if you want.

Mr. Philip Mayfield (Cariboo—Chilcotin, Canadian Alliance): Thank you very much, Madam Chair.

I'd like to thank members of the Canadian Space Agency for being here. The timing of this meeting, for such a young agency regarding its first audit, may seem at first a little awkward, in light of the events of the weekend, but I am sincerely glad that you are here, Mr. Garneau and Mr. Richard.

I realize you know many of the people at NASA and this meeting may be difficult on a personal level for you. I also know you will be in contact with our friends in the United States, so on behalf of my colleagues in the opposition and fellow parliamentarians, I would like to extend our sincere sympathies and God's blessing to all involved in the Canadian Space Agency and its extended family at NASA. The prayers of these parliamentarians are most certainly with the families of the seven who died.

We recognize the incredible talent and commitment it takes to be on this frontier, which you yourself have experienced, sir. This week is a sad time, but it's also a time for our committee to see with renewed eyes the important work Canada is doing. We look at these reports now in a new light--the light of our commitment to continue on through this adversity to the stars. As the old RCAF motto said, per ardua ad astra.

Thank you very much, sir.

The Vice-Chair (Ms. Beth Phinney): Thank you.

Mr. Garneau, do you want to say anything before I introduce our speaker?

Mr. Marc Garneau (President, Canadian Space Agency): No. I just want to say thank you very much for your kind expressions of concern and sympathy.

The Vice-Chair (Ms. Beth Phinney): Thank you.

Our witnesses from the Office of the Auditor General are Richard Flageole, the Assistant Auditor General, and Reno Cyr, principal.

I'll ask Mr. Flageole to begin.

Mr. Richard Flageole (Assistant Auditor General, Office of the Auditor General ): Madam Chair, thank you for this opportunity to discuss our report on the Canadian Space Agency and its implementation of the Canadian space program. Joining me at the table today is Reno Cyr, the principal responsible for this audit.

No one could have anticipated the events of this past weekend with the loss of the space shuttle Columbia. The tragic loss of seven lives overshadows all other aspects of this disaster.

This event may also involve serious setbacks for the international space station program and for the Canadian Space Agency's programs. Your committee's agenda for today's discussion will surely be affected by these events. However, I will focus my opening remarks on our findings, all of which remain relevant to your committee.

This was the first time since the agency's creation in March 1989 that we reviewed its activities. Our purposes were to identify where the agency could improve its management practices and to inform Parliament, key stakeholders, and Canadian taxpayers about the management of the agency's programs.

Beginning with the federal budget in 1999 and continuing today, the Canadian Space Agency has been an organization in transition. In the previous decade its priorities were clear, its funding was project-based, and its strategic and operational management practices reflected the focus on projects. The 1999 budget gave the agency its first stable ongoing funding of $300 million annually, beginning in 2002-03. At the same time, the government approved a new Canadian space program. These changes to its operating environment called for changes in the way the agency did business.

The agency's senior management recognizes the need for change and has stated its commitment to change. However, several issues in our report reflect the fact that the agency has yet to implement fully the changes needed in its management and business practices. I'll give you five examples.

First, the agency needs to develop a new strategy to resolve an imbalance between its financial obligations and its annual budget. It is unable to carry out all the activities intended under the approved Canadian space program, and it needs to present a revised strategy to the government for approval.

Second, the agency has been slow in implementing the new management framework called for in the Canadian space program. After three years, the framework is still not operating as intended.

Third, there is an urgent need for the agency to develop a strategic plan for human resources. The agency is changing the mix of its workforce from the term and contract workers it used extensively to more indeterminate staff, consistent with its stable funding. However, it has yet to define its long-term human resource needs to ensure that it has the right number of people with the right knowledge, skills, and abilities in the right place and at the right time.

Fourth, a related concern is the agency's pressing ahead with its staff conversion exercise without a strategic plan that defines its long-term human resource requirements.

Finally, the agency's measurement and reporting of performance are incomplete. It has few performance indicators to measure its progress toward achieving strategic outcomes, and its performance reporting makes it difficult for Parliament to assess whether the agency is fulfilling its mandate.

¹ (1540)

[Translation]

A particular concern we raised is the legacy of funding obligations from decisions that predate the Agency's creation. Financial pressures from the RADARSAT Program and Canada's participation in the International Space Station have forced the Agency to reallocate funding from other projects and will continue to force it to allocate a significant portion of its budget to the projects over several years. The immediate result is that projects planned for other key service lines of the Agency have been deferred or cancelled, and the full scope of the Canadian Space Program is no longer being met.

The Agency's funding obligations for the Space Station will increase when Canada begins paying its share of the common system operating costs. The Agency's annual share is estimated at $50 million and is likely to increase. With the additional cost of operating and maintaining Canada's contribution to the Space Station estimated at $45 million a year, the Space Station program will soon account for about a third of the Agency's annual budget. Other financial obligations associated with the Space Station, including the cost of carrying out scientific experiments in space, have yet to be calculated.

A major new initiative that the Agency is promoting involves a significant role for Canada in the Mars exploration program led by the United States. Given the current limitations of the Agency's financial capacity to undertake even modest new initiatives, participation in the Mars program would require that the government re-examine the priorities under the current Canadian Space Program and the Agency's annual funding level.

[English]

Madam Chair, we make eight recommendations aimed at improving the agency's management practices. We have attached a list of these as an appendix to this statement. The agency has responded positively to our observations and recommendations.

The committee may wish to discuss with the agency the specific steps it is taking to deal with the issues we raised, and obtain from it a confirmation of its action plan and its timetable for implementing it. The committee may also want to explore the agency's strategies for balancing its annual budget and the financial pressures of its existing projects and possible new initiatives.

Madam Chair, that concludes my opening statement. We would be pleased to answer your committee's questions.

The Vice-Chair (Ms. Beth Phinney): Thank you very much.

Mr. Garneau.

Mr. Marc Garneau: Thank you, Madam Chair.

Before I make some general remarks I obviously have to make reference to the fact that a great tragedy occurred on the weekend with the Columbia, and one that affected not only people personally but also has implications for Canada's space program.

It has been a difficult weekend. We have been trying to absorb what this means for Canada's space program and also trying to cope with the personal links that I think not only people like myself but all employees at the Canadian Space Agency--and indeed perhaps even the general public, because I met many, many people yesterday and talked about this--feel about this kind of an incident.

Having said that, I want to point out that 80% of what the Canadian space program does is not linked to the human space program. As a result of that, and I know that you expressed sympathies and support prior to the beginning of this meeting, I would nevertheless encourage you to be extremely direct in the questions you have with respect to the Auditor General's report, because the reality is that this kind of incident, although very, very unfortunate, is part of the high-risk business the Canadian Space Agency is in.

The job of this committee is in fact to make sure that the Canadian Space Agency is providing value for money. Despite your sympathies, I would ask you to be very direct in the issues and questions that you may have for the Canadian Space Agency. We will try to answer those questions as directly as possible.

Having said that, I appreciate the opportunity to address the Standing Committee on Public Accounts.

¹ (1545)

[Translation]

The Canadian Space Agency has cooperated fully and openly with the Office of the Auditor General and has accepted and is taking action on the recommendations of the first audit of the Agency. Following my brief remarks, it will be my pleasure to respond to your questions concerning the report of the Auditor General on the Canadian Space Agency.

[English]

I would now like to take a moment to share with you some of my thoughts on the Canadian space program. Very few countries are as well suited as Canada to take advantage of space for the benefit of its people. Canada is a vast, resource-rich country bordered by three oceans. The unique vantage point of space allows us to monitor our expansive land mass, our waters, and assert our sovereignty. Canada is endowed with rich natural resources. Here, too, space-based technologies and applications are increasingly enabling us to manage them properly.

[Translation]

Canada is sparsely populated with many remote communities. Satellite technologies are linking citizens with government programs and services wherever they work and live. Canada has an increasingly well-educated population and the space sector offers a wealth of opportunities and high-quality jobs contributing to a strong knowledge-based economy. From monitoring our territory and waters to inspiring Canadians to reach for their highest aspirations, the programs of the Canadian Space Agency and the partnerships we are leveraging continue to play an increasingly important role in the day-to-day lives of our citizens.

[English]

Our vision for the future is one where Canada will expand and apply knowledge of space for the benefit of its citizens, and in doing so, inspire through excellence. This vision speaks to being an open, transparent, and accountable organization and supports a greater engagement of Canadians in the activities of the agency: an opening and extension of dialogue and consultation on programs and priorities with an increasing number of stakeholders in industry, academia, federal, provincial, and territorial governments.

As an example, a broad consultation of government departments, industry, and the science community has identified critical needs where space resources can help government departments meet their policy and operational mandates more effectively. Some of these needs may be met now. Many of these ideas will be brought forward for consideration in 2004 as a space plan for the Government of Canada.

[Translation]

Meeting the evolving needs of Canadians also means extending the vision to ensure Canada continues to lead through the investment and development of high-risk, next-generation technologies. These investments will continue to build on a successful model, linking government, industry and the university research community leveraged through international partnerships. This model has proven itself to be the most efficient means of attaining our national objectives to build innovation, expertise and excellence within the constraints of a defined and limited budget.

The development of leading-edge space science and technology, the design of unique space hardware and its on-orbit operation require stringent quality control and effective planning and risk management processes. While maintaining efficient management of initiatives already approved under the Canadian Space Program, the Canadian Space Agency is pursuing its mandate through the introduction of innovative and modern management practices and a revised Strategic Framework.

[English]

The ultimate outcome of this vision will be better, more effective and efficient programs and services delivered to Canadian citizens. Canadians will be better informed about the concrete benefits they personally receive from their investment in the Canadian space program, strengthening the pride they feel about Canada's achievements in space and improving science literacy and an understanding of the world among youth. The agency's commitment to this vision is to support a dynamic Canadian space program and to be instrumental in helping Canada become one of the most advanced, connected, and innovative nations in the world.

Thank you.

That concludes my opening remarks, and I would be pleased to answer any questions you may have.

¹ (1550)

The Vice-Chair (Ms. Beth Phinney): Thank you, Mr. Garneau.

We'll now begin our first round of questioning, eight minutes to one speaker from each party.

For the benefit of the witnesses, the eight minutes are supposed to include the question and the answer. There will be more time afterwards with other people's questions. We hope you keep your answer within that time, but also that the questions don't take the whole eight minutes.

I think we'll begin with Mr. Mayfield.

Mr. Philip Mayfield: Thank you very much, Madam Chair.

Once again, I'd like to thank the members of the Auditor General's department and the Canadian Space Agency for being with us today.

The annual budget of the Canadian Space Agency is $300 million a year, we've heard, so we can see that space is expensive. It was once the exploration for furthering science, and we now know that technology and commerce are not far behind, so this is an important field of endeavour for Canada. We probably have contributed to this knowledge internationally proportionately well beyond our numbers and our budget, and I think this is probably some of the best money Canadians have spent.

It's in that light that I'd like to ask a couple of questions. Given the tragedy of the past weekend, can you give some idea of the impact on the organization as far as funding and planning are concerned? It would seem even more urgent to meet the recommendations of the Auditor General to cope with the massive adjustment that I think will be necessary at this time, as outlined by the Auditor General's report. Obviously, there are going to be some delays in the projects, but President Bush has stated that he remains committed to NASA's programs. What do you think would be the impact of the loss of Columbia to programs such as the Mars exploration program, for example?

Mr. Marc Garneau: Thank you, sir.

The impact, to be blunt, to Mars at this point is zero in terms of the dependence of Mars exploration on the use of the shuttle. However, in the larger context--the fact that Columbia is no longer available as a vehicle and the results of the inquiry are yet to be known--there could be some long-term effects on NASA's budget, which at this point are unpredictable. Whether that will have any impact on their planned Mars exploration I think is too early to tell at this time. There is no technical connection between them. However, if the results of the inquiry and the recommendations that come out of it are such that NASA takes a new direction in its overall space program, then obviously all of the programs it's engaged in could be affected.

At this point in time we have nothing that leads us to believe that there will be any change of course with respect to Mars exploration. It is certainly our fervent hope that we will be able to participate in a visible manner in Mars exploration in cooperation with NASA.

With respect to the effect on our own program that the Columbia explosion has had, it is the manned space program side of things, so it obviously affects two things in a direct fashion. One is the opportunity for Canadians to fly on the space shuttle, our astronauts, and secondly, what is going to happen to the international space station. The international space station of course can only be built with the use of the shuttle. The shuttle is required to bring the pieces that are used in the assembly of the international space station.

So the building of the station, the assembly, has come to a standstill. Later on, when it was fully built, the intention was to use it at its full capacity as a science laboratory. That is obviously on hold as well. So there are going to be implications for Canada's participation in the international space station because of the grounding of the shuttle.

It's too early to say exactly what the implications are. It could be simply a reasonable delay. It could be more profound than that. I think we'll get more information in the weeks to come.

Mr. Philip Mayfield: Thank you.

The strategic plan the Auditor General mentioned is to be completed in 2003. Where was the agency progress on that initiative before this weekend?

Mr. Marc Garneau: We have had strategies in the past to guide us, so it would be a mistake to assume that we have been without a rudder since the creation of the agency. There have been a number of strategies that have been developed.

However, we fully recognize the need, especially since we converted to an A-based budget in 1999, to have a strategy that takes into account the fact that we're no longer funded on a project basis but have a constant budget. Our plan is to have the draft of that CSA strategy in place by June.

We have five service line strategies. The service lines are the areas we work in. We have five service line draft strategies in place at this time. We're also in the process of developing supporting strategies in other areas, such as human resources, a Government of Canada space strategy, and a science strategy.

¹ (1555)

Mr. Philip Mayfield: Sir, you've mentioned some dates, some targets for yourself. I'm wondering if you could match the dates and the targets in such a way that if you're not able to complete that picture now, you could provide this to our committee researchers so that we will have in our records the information about how you are approaching the obstacles you faced in reorganization, in the financial obstacles and the administrative program that you have. If you could put that in a timeline, would you be willing to supply that to our committee researchers?

Mr. Marc Garneau: Absolutely. The end date at the moment is June, and we would be delighted to give you the milestones on the way to that date.

Mr. Philip Mayfield: Could you comment on those milestones in addition to what you had in your brief report to the committee before questioning began? Could you comment on them, please?

Mr. Marc Garneau: The service line strategies are strategies that identify how we approach each of our areas of activity. The service lines are those areas of activity. Those draft strategies are in place.

However, we have a number of stakeholders. We have our industry stakeholders because part of our mandate is to promote a competitive, export-oriented industry. We have been consulting with our industry counterparts now for the last nine months.

Mr. Philip Mayfield: Perhaps I could interrupt for a moment.

You mentioned in your report that many of your ideas will be brought forward for consideration in 2004 as a space plan for the Government of Canada. Is that what you're discussing now?

Mr. Marc Garneau: No. The terminology is a little confusing. We are putting together a Government of Canada space strategy that specifically targets our government stakeholders. That's why we consulted with 19 ministries and agencies this summer.

How do we address the needs of our government stakeholders--the Department of the Environment, the Department of Fisheries and Oceans, the Department of Indian Affairs and Northern Development? Those are government stakeholders. That strategy will be completed by 2004, because there are a lot of things they asked us to do, and we're going to need some time to figure out whether or not we can help them in areas of security, environment, communications.

We were overwhelmed with the number of areas where they said “Can you help us in this particular area?” We need to do some exploratory work before we can fashion that strategy.

Mr. Philip Mayfield: Is that done within your present budget, or are you going to have to ask for additional funds to do the job being asked of you by the government?

Mr. Marc Garneau: We went forward with a memo to cabinet in November asking for additional funds to do the exploratory work that will enable us to say whether we can help these departments or not.

Mr. Philip Mayfield: I would like you, before you're finished, to finish your comments on your relationships with industry.

Thank you, Madam Chair.

The Vice-Chair (Ms. Beth Phinney): It's somebody else's question.

[Translation]

You have eight minutes, Mr. Desrochers.

Mr. Odina Desrochers (Lotbinière—L'Érable, BQ): Thank you very much, Madam Chair.

I too would like to take a few moments to thank Mr. Garneau and Mr. Richard for coming here today.

We realize that you are here in body, but that your hearts and minds may be elsewhere, given last Saturday's events. Mr. Garneau, your sombre demeanour is evident. On behalf of the Bloc Québécois and my constituents, please accept my condolences. You are a member of the extended NASA family and understandably, you will have some commitments tomorrow in light of events scheduled in the United States. Again, our condolences.

Now, on to more down-to-earth business, if you'll pardon the expression. Early on in his remarks, the spokesperson for the Auditor General emphasized the need for the Agency to develop a strategic plan for human resources. I can appreciate that programming within the Agency depends on related factors, such as astronauts, program promotion and so forth.

Can you tell me how many people are currently employed with the Agency and what the principal jobs entail? What more do you feel is needed to improve performance within your organization?

º (1600)

Mr. Marc Garneau: First of all, let me just say that the Auditor General's recommendations were well received. This is one of our Agency's shortcomings. We recognize that we have work to do on the human resources front. The problem stems from the fact that up until 1999, we were funded on a project-by-project basis and that as such, there was little motivation to increase the number of permanent Canadian Space Agency personnel, since this would increase our costs. However, now that the Agency is allocated a set budget every year, it's a matter of reassessing our human resources, taking this fact into account. We readily admit that we lag behind on this front and we're taking action to remedy the situation.

Prior to 1999, the Agency had approximately 390 permanent employees, more or less, as well as a fairly large number of term and contract employees. Now that our situation has changed, it's a matter of taking a very close look at our human resources to identify a level that would ensure the Canadian Space Agency operates at optimum efficiency, without unnecessary duplication, so that we can pour as much money as possible into our programs. Last year, we reviewed our Agency's operations and in conjunction with the changes now under way, we are looking at the type of organizational structure for the Agency that would prove most efficient.

My sense is that once the transformation is complete, the Agency will be left with anywhere from 600 to 700 indeterminate positions, and with fewer contract and term employees. These changes are now being made. We're proceeding slowly and cautiously, because we're reviewing our structure at the same time. We do not want to hire people to staff indeterminate positions if ultimately our analysis shows that these positions are not required. We need to act on these two fronts simultaneously, because the Canadian Space Agency has some projects in the works and cannot put everything on hold to correct the problem. We are juggling several things at the same time, that is to say we are working to optimize our organization, to transform our operations and to operate as efficiently as possible at the same time. I believe that ultimately, the Agency will have between 600 and 700 indeterminate positions.

Mr. Odina Desrochers: Are you working to a timetable?

Mr. Marc Garneau: I'd have to say that we expect to complete the process within a year.

Mr. Odina Desrochers: I have another question. Judging from the Auditor General's remarks, it seems the International Space Station Program has changed the way in which overall budget funds are allocated. Soon, one third of the budget will go to the International Space Station. You also stated that you were taking steps to secure additional funding to offset this change in direction. I'm curious, first of all, as to the other programs which are currently being given priority consideration by your Agency and the funding you feel is needed to achieve your stated objectives even before any pressure is brought to bear to refocus your programming priorities in light of the International Space Station Program.

Mr. Marc Garneau: Concerning the first point you raised, as a partner in the International Space Station program, we have an obligation to contribute not only toward the equipment sent into orbit, but also toward the infrastructure on the ground. Throughout the lifespan of the International Space Station, we are responsible for logistical matters, for support, for technical requirements and astronaut training. Putting it another way, we own 2.3 per cent of the International Space Station.

It's not the same as when we supplied the Americans with the Canadarm for the space shuttle. We sold this piece of equipment to them, it belongs to them and they service it. However, in this instance, we are one of several partners responsible for a certain percentage of the station, and while it remains operational, that is for the next 15 years at minimum, we are obligated to contribute on an ongoing basis to the upkeep of the equipment and to cover common costs. An intergovernmental agreement to this effect was drawn up, adopted by Parliament and subsequently signed. Specific costs were not mentioned, but there was no misunderstanding as to our obligation to pay these costs.

At present, we likely allocate 20 per cent of our budget to this particular line item. That share will increase as of 2008 when we will be required to contribute to joint costs. We have managed to avoid paying such costs by supplying other items. We hope to propose another kind of trade-off in 2008 in order not to pay joint costs. If we succeed, our overall contribution to the space station will certainly not represent one third of our budget, but more than likely between 15 per cent and 20 per cent. Nowhere is it carved in stone that we would be compelled to spend one third of our $300 million budget on participation alone in the International Space Station program.

º (1605)

[English]

The Vice-Chair (Ms. Beth Phinney): Thank you, Mr. Garneau.

Mr. Mahoney.

Mr. Steve Mahoney (Mississauga West, Lib.): Thank you very much, Madam Chair.

Let me echo the comments of my colleagues. I'd also like to say that I appreciate Mr. Garneau encouraging this committee to deal with the business at hand. That's a very professional approach to it.

You made a comment that 80% of the work at the agency is not related to the human resource side. I'm assuming that means the majority of our work is scientific in support of the entire international effort in space. It has been reported that some quite substantial Canadian scientific projects were lost in the tragedy. I just wonder if you can enlighten us at all on how your agency would intend to deal with that. There must be great costs involved.

With regard to the ongoing program, particularly the space station, it's my understanding that a Canadarm was in the process of being developed for the international space station. Notwithstanding the fact that the decision with regard to its delivery will be made by NASA and the United States, is our agency still going to be able to function in the scientific area of these experiments, plus Canadarm, in contributing to the international space effort?

Mr. Marc Garneau: Canada's commitment to the international space station in terms of hardware involves Canadarm2, a large robotic arm that has been on the station now for coming up to two years. In fact, it is a critical component; they can't build the station without this arm. So Canadarm2 is there. The base on which it operates so it can move up and down the station was delivered last May, so that part is there.

The part you're referring to, which is not yet up in space, currently called the special purpose dexterous manipulator--that's a two-armed robot--is intended to be launched. At the moment the schedule has it going up in April 2005. I think it's highly likely that will slip to the right as a result of all of the missions involving the shuttle slipping to the right. How far to the right, I do not know. That particular component is now being handed over from industry to the government. It's built, it's waiting to go up, and it will have to wait until its shuttle is ready to take it up.

As far as the science is concerned, there's no question we're going to be very limited in the amount of science we're going to be able to do on board the international space station if we don't have the shuttle vehicle, not only to continue building the station, but also to take up scientific experiments and to bring them back down. We'll have to rely on the Russian Soyuz vehicle, which is a very much smaller craft and it is very limited in terms of what it can take up and bring down. So there is an impact on our science program in life sciences and microgravity.

The other parts of the Canadian space program with respect to science that involve us looking at the earth and the environment, trying to understand the causes of global warming, and putting sensors in space to study ozone depletion are unaffected; those are unmanned craft. For example, in May we will be launching SCISAT-1, which is a Canadian satellite, and it will be studying ozone depletion. We have already some payloads in space that we've launched on other people's satellites. We're going to launch a small astronomy satellite in June called the MOST satellite. We are going to continue with programs that allow us to build micro- and small satellites to put in place other scientific payloads. These will be satellites built in Canada and launched into space, and they will allow us to continue with what we call space and environmental science. So that part of the space science program is not going to be affected.

º (1610)

Mr. Steve Mahoney: Thank you. That's good to know.

I know we have a fairly substantial component of the agency, I think, in Moscow. I wonder if the tragedy on the weekend might change the focus of our agency to work more closely in the immediate future with the Russians, given that basically I think they are now seen as the people responsible for doing as much as they can with regard to the international agency. Do you see diverting any of your budget in that area toward the Moscow operation?

Mr. Marc Garneau: As you quite rightly point out, Russia is one of the partners in the international space station, and at the moment they have the only vehicle that can get us back and forth between the station and the ground. If the decision is made during the downtime for the shuttle that we need to send up more Soyuz vehicles to the international space station, then that role will fall upon the Russians.

If the Russians say they're going to need some financing from the other partners, that's where the possibility of Canada having to furnish part of the contribution to make use of the Soyuz vehicle may lead to some costs. It wasn't part of the equation when we were talking about the space shuttle going up.

At this point it's too early to tell. We don't know what the plan is for the international space station.

Mr. Steve Mahoney: My understanding is that your strategic plan that's referred to by the Auditor General will be ready in 2004. Could you perhaps focus that a little more in terms of the timing in 2004? And what impact does the tragedy have on that plan in relationship to your plan for spending?

Do you agree, Mr. Garneau, with the concerns expressed in the report, particularly that the full scope of the Canadian space program is no longer being met and that there's an inability to undertake even modest initiatives? And if you do agree with that, do you have a specific plan you can share with this committee on how you will answer those criticisms?

Mr. Marc Garneau: There is a space strategy that we'll have ready in June, which is our umbrella strategy for all of the agency. The one that will be ready in 2004 is focused on our government stakeholders. Obviously we will then have to modify the one prepared in June 2003 because of the new inputs that will come from the Government of Canada space strategy. This is going to be an evergreen document, at any rate, so we'll continue to do that.

With respect to whether we have the resources to do what we have to do at the Canadian Space Agency, let me say that last year we went through a priority review. We went through it in the spring, and we had $58 million more on our plate than we could finance. We went through the review and found the highest priority programs that we wanted to push in order to stay within our $300 million budget. That said, we also cut out $12 million worth of programs that were already underway to replace them with new, higher priorities. We are doing priority reviews, and we're committed to doing that in our cycle on an annual basis, because we always have more requests from our stakeholders than we can accommodate.

We went to the government. We went forward at the last budget seeking increased funding, but largely because of what happened with 9/11, we didn't even get to first base. We are going back to government; we went in November with another application.

We're trying to do two things. We're trying to get more funding, but at the same time we realize that if we're not going to get it, we have to have a prioritization review within the agency, and we're committed to that on an annual basis.

º (1615)

The Vice-Chair (Ms. Beth Phinney): Thank you.

Mr. Steve Mahoney: My time is up, but I might just add that we also have stakeholders who ask us for more money than we're often able to deliver, so I sympathize.

The Vice-Chair (Ms. Beth Phinney): Mr. Martin.

Mr. Pat Martin (Winnipeg Centre, NDP): Thank you, Madam Chair.

I would like to thank you for making the effort to be here today to deal with what are really technical administrative matters of the Space Agency, when your mind must be occupied with the events of the weekend. We do appreciate that.

To start, looking at the recommendations in the AG's report, you would have to say that it was fairly critical, given the diplomatic language in which it's couched--and the Auditor General's language always is very diplomatic in its turn of phrase. Really, looking at recommendations 7.36 through 7.99, it begs the question, if in 1999 we switched from predictable, project-based financing to stable core funding of $300 million a year, and the Auditor General finds now that there is no strategic plan with clear objectives, there's no yardstick to measure progress, and there's a lack of priorities, on what basis do you think the agency was granted core stable funding of $300 million a year, in the absence of a business plan?

Mr. Marc Garneau: I think the decision was based on its track record. If you look at the history of the Canadian Space Agency, you'll see that it is a remarkable one. We were the third country in space. We launched our first satellite back in 1962 to study the ionosphere. We were the first country in the world to put up a national communication satellite. We were the first country in the world to put up a direct broadcast satellite. We built the Canadarm. We were the first country in the world to put up RADARSAT, which is the only operational remote sensing satellite in the world. It has captured 15% of the world imagery market. It delivers products to 600 clients in 60 countries. Canada has a remarkable track record in that respect. I think based on this, the government felt it was a good decision to have a budget that was constant for the Canadian Space Agency. I hope we will continue to be able to prove to Canadians that it was a good investment.

Mr. Pat Martin: That's a hell of a good answer.

I think most Canadians are justifiably proud of many of the things you've cited. I'm the first to admit it. Coming from Manitoba, I know there was a history of the aerospace industry, the Black Brant rocket program.

I guess I would ask you a question, then. In your list of priorities, other than our commitment to the space station, do you anticipate decentralizing some of the activity throughout the country?

I'll ask specifically about the possibility of the Churchill missile launching base, which has been dormant for many years, but has been cited as a possible revenue-generating, profit-making service that we might market to other countries that might want to launch satellites in a climate that has more clear days than NASA does in Florida. Is this on the radar screen at all for you, and is it something you would view as a favourable priority for future spending?

Mr. Marc Garneau: The Churchill range was used extensively, as you probably know better than I, in the sixties, seventies, and up to the early eighties. Over a thousand Black Brants were fired out of Churchill, the Black Brant of course being built by Bristol Aerospace in Winnipeg. It was an extremely useful vehicle for studying particularly ionospheric physics because of the fact that we happen to be located under the northern lights, and it proved to be probably one of the main reasons that Canada is regarded as the expert in ionospheric physics today. So there's no question about it, it has proven itself to be extremely useful.

Having said that, we have to look at all of the priorities within the agency and decide how to spend our money. This falls into the realm of science. There was a proposal a few years back to take it commercially, and there was one launched that was managed by a commercial firm out of Churchill. Unfortunately, there was no follow-on, because the business case for it being run by a commercial enterprise was not strong enough to make it viable as a commercial enterprise. So if we were to continue doing launches out of Churchill at this point with Black Brants, it would have to be underwritten largely by the Government of Canada.

With all the priorities we have with our very limited budget at the moment, there is not a sufficiently compelling case for us to reopen operations in Churchill.

º (1620)

Mr. Pat Martin: Time?

The Vice-Chair (Ms. Beth Phinney): Two and a half minutes.

Mr. Pat Martin: In specifics dealing again with the recommendations of the Auditor General, which is really why we're here, I notice one of the recommendations citing paragraph 7.62: “In proposing future projects for Cabinet's approval, the Agency should consider carefully its ability to sustain funding commitments for projects that involve high risk, international partners, and leading-edge technology...”, etc. You can read it for yourself.

I guess in projects that involve high risk, our losses on the weekend leap to mind. What kind of insurance do we carry? Were you insured at all for the very real financial losses that we incurred with the tragic events on the weekend?

Mr. Marc Garneau: I'm afraid I cannot answer that question right now. I'm going to have to check. It's a good question. I don't know.

We had two experiments on board. My guess is that they were not insured, but I will check and get back to this committee on whether they were insured. We do insure certain things, such as launches of certain satellites, but I do not know whether we had insurance for the two experiments that were on board the Columbia. We will get back to you on that.

Mr. Pat Martin: Fair enough. Thank you very much.

The Vice-Chair (Ms. Beth Phinney): Thank you.

You can send your response to the clerk of the committee.

You have another minute if you'd like it.

Mr. Pat Martin: Maybe I'll just tell Mr. Garneau what I was thinking when I first saw you. I remember years ago when my kids were small and you were flying over the night sky in the space shuttle and we were on a camping trip in Prince George. I had my toddlers, my kids, convinced that if they stood on a rock and yelled load enough--hi, Marc--that in fact you would know that they were down there.

Mr. Marc Garneau: I think I remember, actually.

Mr. Pat Martin: Do you actually remember that? Oh, good, I'll tell them.

The Vice-Chair (Ms. Beth Phinney): Thank you very much.

Mr. Forseth, four minutes.

Mr. Paul Forseth (New Westminster—Coquitlam—Burnaby, Canadian Alliance): Thank you very much.

Welcome to the committee.

You say in your statement here that investments will continue to build on a successful model linking government, industry, and the university research community, leveraged through international partnership. I want you to address that a bit. We know that other countries, like even Japan, China, and India, I suppose, and others have space programs. So I'm wondering if we're too much tied to the United States. You talked about a priority review assessing the what, but what about assessing with whom, and how that relates to our priority review of specifically what Canada, in its own sovereign mind, should be deciding what to do?

Mr. Marc Garneau: If Canada wants to do it by itself and not depend so much on other partners, that is one option. However, the budget has to be considerably bigger to do that. We're kind of unique as a country in the sense that we really work hard at leveraging our international partnerships. For example, RADARSAT-1 was launched for free. That was $100 million. In return for that, we promised to give our NASA partners the information from RADARSAT-1 during its lifetime. So that's the kind of leverage we get. Alouette-1 was launched by the Americans in return for data.

We probably have had NASA as our strongest partner because we started 40 years ago. We've been a member of the European Space Agency for the past 23 years, and are the only non-European country to be a member.

At the moment, we have an instrument on its way to Mars on a Japanese satellite called Nozomi. We have an ozone-measuring instrument on a Swedish satellite, the Odin satellite. So we work with the Swedes. We have contributed to five instruments to the tune of $45 million on the European environmental satellite, Envisat. We are contributing in a similar vein to other satellites flown by NASA, which have nothing to do with the manned space program.

Up until now, the problem has been that if we wanted to get our scientists' instruments into space, unless we built our own satellite, which costs a great deal of money, the only other option has been to ask another country if we can put our instrument on their satellite. If we wanted to launch our own satellite, we had to go and cook up a deal or pay for the cost of getting another country to launch it, because we don't have a launch capability. So that's the approach this country has taken.

To put things in perspective, our budget is 75 times smaller than NASA's budget. So this is the relationship. But I think people at NASA will tell you that we get more bang out of our little $300 million than they do on a dollar-per-dollar basis, because we scramble so hard to work with other countries.

The price we pay in working with our international partners is that certain conditions are imposed in terms of schedule, in terms of how we design our experiments, and of course the fact that we share the risks. Unfortunately, last weekend was an example of what can happen when we share the risks.

If we want to get away from our dependence on other partners, then we have to be ready to commit a much larger amount to the Canadian space program. I don't see any other alternative.

º (1625)

Mr. Paul Forseth: I just wanted to ask a supplemental question. I assume the $300 million you talked about is the Canadian taxpayer portion. You also talked about leveraging. Perhaps you could talk about other private sector spending. Is the figure you mentioned the total spending in the Canadian envelope of all concerned, or is it just taxpayer spending?

You talked about the priority review listing of what Canada wanted to do. But I also wanted you to go a little bit further on that priority review, considering not only the what but with whom. Again, coming back to the question, are we tied too strongly to the U.S. program, and will this be part of the review—the whom as well as the what?

Mr. Marc Garneau In terms of leveraging other than with international partners, that's a very, very good point. If you look at RADARSAT-2, which is going to replace RADARSAT-1, we decided to do a public-private partnership there. In fact, Canada is leading the world in trying to move remote sensing into the private sector, just as communication satellites are largely a commercial undertaking today.

We are paying $432 million for RADARSAT. However, the company that is building it, MDA, is paying $92 million, plus they are assuming the full operational cost during the lifetime of that satellite, which is estimated to be seven years. So in terms of life cycle costs, we can argue that the private sector is paying 30% and we are paying 70% over the life cycle. The satellite will be turned over to them, and in return they will provide the Government of Canada with $430 million worth of services during the lifetime.

Another example is Anik F2, which is owned by Telesat, which is the commercial operator here in Canada of satellite communications. They're very successful, and they've been around a long time. They were responsible for Anik A1, all the way up to now Anik F2.

On Anik F2, there is an $80-million Canadian Space Agency or government-financed payload called a Ka-band transponder. Ka-band is the highest frequency band that has been used in communication, and it's capable of providing full broadband services.

We made a deal with Telesat. We asked if we could put our transponder on their satellite, which they were going to launch later in the year. They could use it, but in return we wanted them to give the Government of Canada $60 million worth of services over the next ten years. We cut that deal with Telesat, and in return for that Telesat promises the Government of Canada $6 million per year for the next ten years of broadband services that we can use any way we want. Health Canada can say they want to use it for telemedicine. Any government agency that needs to use broadband services is going to be able to use it.

That's another example of leveraging with Canadian companies. So we look at that as well as working with international partners.

As far as reducing our cooperation with NASA, I think it's a two-edged sword. If you look at the cooperation we've had with NASA over the past 40 years, I think you would have to conclude that it has been beneficial. It hasn't always worked out, and unfortunately that's part of the risk we assume.

º (1630)

Mr. Paul Forseth: Thank you.

The Vice-Chair (Ms. Beth Phinney): Okay, Mr. Harb.

Mr. Mac Harb (Ottawa Centre, Lib.): Thank you very much, Mr. Garneau. Again, my deepest condolences to you and to all the families and friends of the victims.

We talk about risk; as well, there are always opportunities. I want to ask you a question about risks. When we talk about space, often if you were to have seen one of those.... I'm sure, since you were in space, you probably would have noticed the amount of junk that exists in space, satellites that have been decommissioned, that don't function, pieces of metal that have fallen off ships, other pieces of equipment that have passed their time, and so on. I suppose after some point in time it would cause some sort of a risk for some of the functioning satellites that exist in orbit, as well as some of the ships that might travel in that part of the world.

My thought is whether there is some sort of international registry so people can say, okay, this is my ship or my satellite that's being decommissioned, number 53-..., or whatever, or whether there is some sort of standard internationally that someone is working on to say if you put a system in orbit, it's your responsibility at some point in time not only to track that system, but if you decommission it, whether you have to bring it in or deal with it, this is what we recommend you do.

Secondly, if there is no standard, do you think there is room for the Canadian Space Agency to play a leadership role on the international scene by saying let's sit down and work out some sort of a plan whereby we can deal with this issue, and if there is a market for recycling, for example, if the Space Agency might figure out a way to go and bring down some of those systems or figure out some way to reuse them?

I guess it's a blanket question. I'm interested in your comments. I don't have any questions other than that.

Mr. Marc Garneau: There's no question that space is a hostile environment. At the beginning of the space program, the only thing you had to worry about was cosmic radiation, the temperature extremes, the vacuum of space, and natural micro-meteorites, that kind of thing. Now we have to add to that man-made debris. And it actually is recognized as a very serious concern.

Even though space is a very big place, there is now evidence that collisions have occurred, none of them responsible for any loss of life--some of them possibly responsible for damaging satellites; this is now recognized. And there are a number of initiatives and standards that are being invoked now by space-faring nations. Some of them, for example, deal with one of the big culprits, which was typically the second or third stage of rockets that would help to bring something up there, and when they'd finished their job they still had fuel in them, and that fuel would turn into a gas under heating from the sun and eventually explode the whole fuel tanker, the whole remaining craft, and that would cause lots of pieces to go all over the place. And now procedures are in place for a valve to open to get rid of all the remaining fuel so it's not going to cause this pressure situation.

Another procedure is in place for de-orbiting. As you know, if you bring it down, it's going to eventually get caught by the drag of the earth and re-enter and generally get consumed on its way down. That's another way of accelerating the taking of space debris out of orbit. Everything over 10 centimetres is monitored in space by NORAD, so at the moment we know about everything that's over 10 centimetres, so we can plan in accordance. And quite a bit of that will eventually re-enter the earth's atmosphere. Some of it unfortunately is going to be up there for tens of thousands of years because it's higher up.

What about the stuff that's smaller than 10 centimetres? That is a serious concern, there's no question about it. I've been on a space shuttle where I've been witness to a small ding in one of the windows because of something that was very, very small but unfortunately travelling at a very high velocity.

Interestingly enough, DFAIT, or Foreign Affairs Canada, suggested an initiative such as the one you are mentioning, a number of years ago--a kind of a craft that would go up and help pick up some of that junk. Unfortunately, it did not receive the support to take it forward. We tried to promote it. I was not involved in it myself. We tried to promote it on an international level, and I think probably it was just a little bit ahead of its time. It is something that may come in due course.

So, yes, countries are turning towards the very important question of man-made debris, but we're not there yet.

º (1635)

[Translation]

The Vice-Chair (Ms. Beth Phinney): Merci beaucoup.

Do you have a question, Mr. Gaudet?

Mr. Roger Gaudet (Berthier—Montcalm, BQ): Thank you, Madam Chair.

Mr. Garneau, the AG noted that your Agency is slated to receive $300 million in 2002-2003. Recently, the Standing Committee on Finance held a series of consultations to ascertain your financial requirements. Based on your strategic plan, what will you be seeking over the next three years in terms of personnel and programming as such, and do you expect to receive adequate funding to meet your objectives?

Mr. Marc Garneau: We requested additional funds from the government in the last budget, and again this time around in November owing to some unexpected expenses we incurred.

We built RADARSAT-1 pursuant to an agreement with the United States. The Americans agreed to launch our satellite and in exchange, we would supply them with the data from this satellite. We continue to do that today. In fact, the biggest user of RADARSAT data is the United States. We came to a similar agreement in the case of RADARSAT-2. Unfortunately, five years after signing off, the Americans decided that they no longer wanted to hold up their end of the bargain. Regrettably, we found ourselves in a position of having to cover launch costs and given the ITAR policy which was implemented around the same time in the US, we also had to change contractors. Instead of having an American contractor responsible for the main structure, or bus, we had to look into having this part built by the Europeans. All in all, this cost us approximately $160 million, which was absorbed by the Canadian Space Agency over a four-year period, which is set to end next year.

Had we not been facing a $160 million tab for expenses associated with RADARSAT-2, the situation would have been quite different and I might have been able to tell you if $300 million in funding was an adequate amount. Unfortunately, because of this unexpected turn of events...Furthermore, all of this money flowed out of the country, unfortunately, because we found a company -- a U.S, company -- to launch the satellite. However, we incurred costs of $108 million, and we were forced to find a contractor to build the bus. This merely added to our overall costs and to the money flowing out of the country. The Agency absorbed this expense, otherwise we would likely have requested less money from the government last November. Therefore, it's possible $300 million would have been a reasonable request, but when unexpected costs arise, the situation changes completely. In this case, $300 million wasn't enough money.

Mr. Roger Gaudet: I have a small question. Getting back to my colleague's query, you estimated that between 20 per cent and 25 per cent of the funding allocated covered the participation of the Canadian Space Agency in the International Space Station program. What about the remaining 75 per cent or 80 per cent of the funding?

Mr. Marc Garneau: The funds will be used for programs like RADARSAT, for the development of remote sensing applications, for space science, for our involvement in the

[English]

James Webb Space Telescope, the Hershel, the Planck mission, the Swift mission.

[Translation]

the development of a program in Canada for microsatellites and small satellites that would be built right here in Canada, so that we would no longer need to buy them elsewhere. I have a long list which I could turn over to you, but this has nothing to do with manned spaceflight.

º (1640)

Mr. Roger Gaudet: Thank you, Mr. Garneau.

[English]

The Vice-Chair (Ms. Beth Phinney): Thank you.

Ms. Meredith.

Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Yes, thank you, Madam Chair.

I'd like to also add my condolences to the agency for the loss of friends and associates.

I'm going to ask you more on the management end, because I think you've been asked many questions on the funding and the difficulties in balancing the priorities with how much money you have. But the the space management program framework of 1999 also formalized the structure of the management group, and it recommended that there be a Canadian Space Agency advisory council with service line advisory groups for each of the agency's five service lines.

In the audit report, there seemed to be a concern that either the advisory groups weren't formed or they certainly weren't part of the process, and that when the budget priorities were set and the strategy was set, they weren't even included in it. So could you maybe respond to this concern that was expressed by the auditor's report?

Mr. Marc Garneau: Of course. The Auditor General's report covered the period I think going up to the end of June, and what they said was largely true.

We now have all our five service line advisory groups named, and they've all met. We have had two meetings of our CSA advisory council since the completion of the audit, or the period when the Auditor General started to write the report.

I can say with complete confidence that in the last two meetings of our advisory council, and they were the third and the fourth, they have become fully engaged. It takes a while to get up to speed, but I think they're fully engaged. In the third one they had a chance to make an input to our preparation of a memorandum to cabinet, which we made in November.

So we have the service line advisory groups named, in place. They have met, and will to continue to meet. The structure is in place, and the CSA advisory council has now met four times, most recently a couple of weeks ago.

We also have always had space science advisory groups. They have been around for many years. That's perhaps a sub-set of these, but an important group as well, which maybe brings in our university stakeholders.

Ms. Val Meredith: So you would feel this is a valuable contribution to your prioritization and strategy development, and you will continue to support it?

Mr. Marc Garneau: Absolutely. We look to our advisory groups, which, as you point out, are from university, government, and industry, to advise us.

We have also had the interdepartmental committee on space in existence now for at least twenty years. So we have had a body there that includes all our government stakeholders in place for many years.

Ms. Val Meredith: Thank you for that.

Is part of your strategy and prioritization an educational component? By educational, I mean making the public, Canadians, aware of what it is that you do--that is, the innovative technologies that you have supplied over the years, the length.

I think all of us were a little bit taken aback that we're talking forty years. Is part of what you do making sure Canadian young people and all Canadians are aware of the agency?

Mr. Marc Garneau: It is, although you could argue we don't put sufficient resources into it. That's the problem.

I would say that the Canadian Space Agency is probably the most solicited government agency, solicited by the general public for information about Canada's space program and about science in general. We get an enormous amount of communications and interest shown by individual young people, older people, by schools.

There is a very close link with the Association of Science-Technology Centres and museums across the country. We have a kids website, which is an award-winning kids website. We have a CSA website, which was in December the website of the week in Canada. Our astronauts and other members of the Canadian Space Agency spend a great deal of time going out and talking to people right across the country. So we do have an outreach that is very significant, but not funded well enough.

If you look at what NASA does, they put just two-thirds of 1% into outreach. That's $100 million. That would be one-third of our budget. They have a ten times bigger population as well, but we'd like to be able to put two-thirds of 1%. Two-thirds of 1% would be $2 million, and that means that other programs would not be touched. But we're always trying to get as much as we can out of it, because we realize it's a potent tool for interesting young people, especially in science and technology, because of the fascination of space.

º (1645)

Ms. Val Meredith: I would like to finish by saying it's tragic--

The Vice-Chair (Ms. Beth Phinney): Your time is up. You had about three minutes.

Ms. Val Meredith: I think it's tragic that the only news you get is when tragic events occur, and that there's not more promotion in our media for the good news.

Mr. Marc Garneau: Yes. We did our best to promote the two experiments on Columbia, and they did receive quite a bit of coverage. But you're right, in general, people were not aware that vehicle was up there until it exploded.

The Vice-Chair (Ms. Beth Phinney): Thank you very much.

Before we go into the second round, I would just like to use my prerogative to ask a couple of questions.

I'd like to ask Mr. Flageole, so he doesn't feel left out, how you feel about the agency's response to your recommendations. When you're finished, I'd like to ask Mr. Garneau if he could share with the committee some of your plans to carry out the recommendations.

In general, you've said yes, we think this is a good recommendation, we're going to do it. I think one is 7.44, where you said yes, the action is underway. You agree with the recommendations, but it doesn't seem to go much further than that. So if you could give us some ideas of where you're going to go with these recommendations....

Mr. Flageole.

Mr. Richard Flageole: Thank you, Madame Chair.

Overall, I think we were very, very satisfied with the reaction of the agency, starting from the beginning of the audit. We met the management team, who went through an audit exercise with a very open-minded attitude. They provided us with a very high level of cooperation. They were open to suggestions.

As we said at the beginning of the chapter, this is an organization in transition. The fact that they received ongoing funding in 1999 has a very important impact on the way they manage their operations. There are still a fair number of things to do, as we mentioned in the report, in terms of planning, project management, HR, and performance measurement.

We are encouraged by the reaction of the agency. At the same time, I think it's important to make sure we'll have a firm timetable and definite plan of action to address those issues.

The Vice-Chair (Ms. Beth Phinney): Thank you.

Mr. Garneau.

Mr. Marc Garneau: Madam Chair, I don't want to bore this committee with our plan of action, but it's here in about five pages and it addresses the specific recommendations, if I may offer to forward it to you. It details how we will specifically address them in not too much micro-detail, but at least, I think, more satisfactorily than I've done so far.

The Vice-Chair (Ms. Beth Phinney): All right, thank you. If you would forward that to us....

Mr. Marc Garneau: We have an RPP, a report on plans and priorities, coming out in about a week's time that also addresses the Auditor General's recommendations.

The Vice-Chair (Ms. Beth Phinney): Will you forward that to us?

Mr. Marc Garneau: Yes.

The Vice-Chair (Ms. Beth Phinney): Thank you very much.

Now we'll move on to the second round, starting with Mr. Mayfield.

Mr. Philip Mayfield: Thank you very much, Madam Chair.

The agency has committed to implementing the initiative to modernize the comptroller function to improve reporting to Parliament, particularly with regard to communication on performance. I would like to ask you how far this initiative has progressed. Can you briefly answer that?

Mr. Marc Garneau: At the moment, we are supposed to report on our performance through the RPP document. We have seven strategic outcomes against which we measure our performance in the various programs we undertake. We have been reviewing those seven strategic outcomes because we do not think they correspond to accurate measurement criteria. The Auditor General has also made that point with us.

We cannot modify them at this point, since we would have to go through Treasury Board to do so. It is our intention to request that we modify the strategic outcomes so that they more accurately reflect what we are actually measuring our performance against. I think this will give an indication to Parliament in a more accountable way of whether or not we're achieving our objectives.

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Mr. Philip Mayfield: These outcomes would be reported back to Parliament, would they? How would they be directed? Would they be directed through Treasury Board? How would Parliament receive those?

Mr. Marc Garneau: I'm not an expert here, but I'm told we have to go through Treasury Board to propose under the framework of a document called the PRAS. They will have to get into it. How it makes its way to Parliament to approve, I will defer to....

The Vice-Chair (Ms. Beth Phinney): What's a PRAS, and how do you spell that?

Mr. Marc Garneau: I'll let Mr. Jacques Bruneau, who is our head of corporate finances, answer the question, if I may.

The Vice-Chair (Ms. Beth Phinney): Mr. Garneau, could you introduce the witness, please?

Mr. Marc Garneau: Monsieur Jacques Bruneau is a director general at the Canadian Space Agency. He is responsible for corporate management at the agency. I believe he is better qualified than myself to answer the question.

The Vice-Chair (Ms. Beth Phinney): Go ahead.

Mr. Jacques Bruneau (Senior Financial Officer and Director, Corporate Management, Canadian Space Agency): Madam Chair, I guess what Dr. Garneau referred to is that the agency will be looking at this whole strategic framework, as he mentioned. In that context, we have to look at our strategic outcome and whether, in the way it's now spelled out, we respond to what we feel should be the framework against which we would report in our RPP the targets we will pursue with the funding the House votes for us. In that context, I guess the president, in re-looking at its strategic plan by June, would likely entertain some discussion with the Treasury Board on redefining that framework.

The PRAS is essentially the planning, reporting, and accountability structure that each department agrees with Treasury Board should be the one used to report to the House of Commons.

Mr. Philip Mayfield: Why go to Treasury Board then? Believe it or not, Treasury Board is not a very direct route to Parliament. I'm wondering, is there some way that report could be sent to the researchers of our public accounts committee? This is where Parliament meets, believe it or not, to consider that kind of stuff.

Mr. Jacques Bruneau: My understanding, sir, is that the Treasury Board defines, in conjunction with the House representative and the Auditor General, the way in which the reporting of the government should be done to the House. The agency is obligated to fulfill its obligation under that reporting framework.

The Vice-Chair (Ms. Beth Phinney): Mr. Mayfield, thank you very much.

Mr. Mahoney.

Mr. Steve Mahoney: Thanks, Madam Chair.

I have two questions. One might be a little naïve; I don't know.

Does the agency look at revenue opportunities anywhere? If so, could you tell me what they might be?

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Mr. Marc Garneau: The CSA does not have any direct involvement with NORAD in that regard. Our mandate, of course, is a civil one. We do not regard that as part of our mandate. We are available within Canada if the Government of Canada wanted to consult and ask for our support or input to such matters, but that is not within our umbrella of activities at this point.

Mr. Steve Mahoney: Would it be fair to assume that if such a defence system were indeed developed and potentially deployed, it would cause pretty catastrophic damage in space? In going back to my colleague's question about the junk that's already up there, would that not be a fairly significant concern, both to the Canadian agency and to the United States?

Mr. Marc Garneau: Answering the question on a purely technical basis, there's no question about it: you blow something up in space, it's going to cause a lot of debris, and a lot of debris makes life difficult for anybody who wants to put anything else up there and try to ensure its survival so it can operate.

Mr. Steve Mahoney: Okay.

Let me ask Mr. Flageole to follow up on the chair's question about your reaction to the response from the agency.

In another life I spent about four years on this committee. I've been off it for the past while, but now I'm back. It's always my experience that for the most part, when the auditor appears side by side with a particular department, there's pretty much agreement on what needs to be done.

Unlike the comment by Mr. Martin, I don't find this particular report terribly critical. In fact I think the agency has been quite responsible in living up to finding ways to deal with their funding shortfall of $58 million. I'm sure it was painful. I'm sure you've made some cuts you would rather not have made.

Is it fair to say that the bottom line for the auditor is that this agency has indeed been fiscally responsible, lived within their mandate, and that in a perfect world they would be able to do more in terms of their mandate if more funding were available?

Mr. Richard Flageole: Madam Chair, I think I would agree with that statement. Yes, the agency had been fiscally responsible. They had to make the adjustments to their own operations to make sure they would live within their budgets. As mentioned before, there is a fair amount of risk in this type of business. I think the president just referred to an event involving RADARSAT, which was not predictable at the beginning, and which resulted in a fair amount of extra expenditures by the agency.

I think we're expressing concerns about the future. The question of the balance between the objectives and what this agency has to do under the Canadian space program and the level of its present and future financial obligations requires a very careful analysis.

The Vice-Chair (Ms. Beth Phinney): Mr. Mayfield.

Mr. Philip Mayfield: Thank you very much, Madam Chair.

I would like to come back to the issue of reporting to Parliament. My experience on this committee leads me to believe that because it goes to Treasury Board doesn't mean it comes to Parliament.

So I'm going to ask Mr. Flageole, what was your understanding of this component of the agency reporting to Parliament? What was the mechanism? In your understanding of this component of the report, how was it to be done?

Mr. Richard Flageole: Madam Chair, the agency is following the standard framework for reporting to Parliament. This includes a report on plans and priorities, which has to be presented and tabled every year, as well as a departmental performance report. So on this aspect, they are under the same rules promulgated by Treasury Board as any other department and agency in the federal public service.

Mr. Philip Mayfield: So it's appropriate for us to ask them to include in their annual report tabled to Parliament the reports we've been discussing. Is this correct?

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Mr. Richard Flageole: Those reports are required to be tabled in Parliament. They are usually referred to other House committees, who can examine them. Again, these are the standard procedures.

Mr. Philip Mayfield: Now, in your understanding, would that—

The Vice-Chair (Ms. Beth Phinney): Mr. Garneau would like to answer this too.

Mr. Marc Garneau: Just to amplify what Mr. Flageole has said, our minister tables these two documents, which mention our strategic outcomes and assess how we perform against them. So this is part of our annual cycle.

Mr. Philip Mayfield: Are these from the President of the Treasury Board or from Industry Canada? Which department is it?

Mr. Marc Garneau: No, Minister Rock presents or tables them in Parliament.

Mr. Philip Mayfield: I see. Okay, thank you very much. I'm pleased to have that sorted out, in my mind at least. It was probably clear in yours, anyway.

In the August 2002 Ottawa Citizen there was a report on work being done on the Mars program at the university in Winnipeg. Students of the university were saving the government money by building a Mars environmental chamber. It was reported to have cost them about $15,000 to do this, whereas if you had gone out to industry and let a contract for that, it would have cost $200,000, as I think was mentioned.

Can you elaborate on the Mars exploration program in terms of its budget priority?

Mr. Marc Garneau: In the area of space science, space exploration is one of the areas in which Canada has part of its mandate. Because we respond to our research communities, or to these stakeholders and their desires with respect to space exploration, we have Canadians who are recognized in the area of space exploration.

I have made it part of my vision for the Canadian Space Agency that Canada participate in a visible way in Mars exploration. As I mentioned, Canada currently participates in an instrument on a Japanese satellite on its way to Mars. This will be the first thing Canada sends to Mars. We are two of the four finalists in the NASA Scout mission for 2007. Canadians aren't leading it, but we're part of an American team. So this may be yet another participation of Canada on a small scale.

Mr. Philip Mayfield: Can you give me an idea of the budget priority for this Mars project?

Mr. Marc Garneau: In terms of priority, that project will have to be measured. We have financed it to the end of phase A, which is the conceptual study. At the moment we have not funded it beyond those levels and we will have to examine how it will fit. We won't have to make a decision on that until next fall, when the finalist is chosen. There are four finalists, and the Canadians are only involved with two of them. But if one of them is in there we will look, at that point, at the cost and we'll measure it against our other priorities. This would be for funding that would start to be spent in 2004 all the way up to 2007.

The final bigger thing is the fact that the NASA administrator, Sean O'Keefe, sent us a letter about two months ago inviting our participation in the biggest mission of the decade, which is the Mars science laboratory in 2009. We call it the capstone mission of the decade, and we have been working in the last year to show that we would be a good partner. We have some key technology to bring to this lander-rover that is going to be looking for signs of life, digging underneath the surface of Mars. We have some key technologies in a number of areas--in obotics, minin, and lidar technology--and we have some scientists who can contribute to the science of the mission.

We've done that during the past year because, first of all, you have to prove to whoever you're going to work with that you can do it, and we've sufficiently proved to them that we have something to offer.

Missions to Mars are more complex by an order of magnitude than missions to low-earth orbit--very high-risk. We have sufficiently impressed them that Mr. O'Keefe sent us a letter and said they'd like us to participate in the mission in 2009. The rub is, we have to tell them this winter, because the mission has to get under way.

The cost of our involvement with that is significant. We have gone forward in our MC requesting this funding, and it's a go/no-go situation. The government is going to decide either yes or no. If it says no, then we're out of it. It can't say yes, but we'll give you half the money. It's go/no-go, and it has to be done this winter.

That would be a very visible presence for Canada in space. There's always the potential that it may be the mission that establishes directly whether or not life exists or has existed on Mars--a very exciting possibility. But it requires a decision by the government in this budget.

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Mr. Philip Mayfield: And certainly it's a turning point in our commitment to space and deep space exploration.

Mr. Marc Garneau: Absolutely. This is a bigger-than-ever commitment to space exploration.

Mr. Philip Mayfield: Can I have one more question?

The Vice-Chair (Ms. Beth Phinney): You're four minutes over already.

Thank you very much. I'm sorry to interrupt you.

Mr. Mahoney.

Mr. Steve Mahoney: Thanks, Madam Chair.

I wonder if you've given any thought to perhaps using the resource of members of Parliament in terms of communicating what the agency is doing. I think this goes somewhat to the point that Val and Philip were making in regard to getting this information out there.

We all have schools in our ridings. We're always asked to go to those classrooms and talk to the kids. This is the kind of stuff I think they would love to hear about, and it would be very helpful to us. At the same time, it would facilitate an opportunity to get your message out a little more broadly, just in terms of the public communication. I don't know whether or not you've thought about that.

I recognize your budget constraints, and I'm not suggesting you spend millions of dollars on CDs or communication material, but there must be some way. As a group, there are 301 of us. Perhaps we could help and work a little more closely.

Mr. Marc Garneau: Well, thank you very much for the offer. We certainly have excellent materials, and we could put together packages for members of Parliament who are willing to do this, with pleasure.

Some hon. members: Hear, hear!

The Vice-Chair (Ms. Beth Phinney): That's a very good idea. Thank you, Mr. Mahoney, for the suggestion.

Ms. Meredith.

Ms. Val Meredith: I want to follow up on my colleague's conversation with you on the mission to Mars. You've gone for funding because it's a go/no-go situation. Is that request for funding above your normal yearly budget, so this would be an additional amount of money specifically for this project that you have requested?

Mr. Marc Garneau: Yes, it is. And may I take the opportunity to explain something here? It would fit into the category of a big program. Unfortunately, one of the drawbacks with constant funding is that it defies the reality of big programs. We're going to go RADARSAT-3 one day. If it's like RADARSAT-2, we're talking about a $500 million satellite.

Typically, the spending curve for a large project, or any project, is bell-shaped over time, and you cannot absorb that kind of cost within constant funding. At one point the top of the bell is going to burst through the top of your funding envelope and you cannot do anything else but fund that, or you can do very little else during the period when you're having to spend the majority of the money, which is the middle portion, on those big projects. Government recognizes that there are cases where we will come forward and make requests for big programs because there's just no way they can be accommodated within our A-base.

Ms. Val Meredith: I guess that goes into what I understood from the Auditor General's report--this balance of all the projects and priorities with the amount of money that's there when you're planning and strategizing. Obviously, here you have 2009, where you're going to need, at either the lead-up to it or at that point, an influx of money that you can't accommodate in your budget.

Is that included in your planning and priority budgeting? Or is what you're offering the government and the audits, when they're done, a statement like “This is our plan; we will require more money than our regular budget at this point, this point, and this point“? Is that how you.... Or do you just go in and knock on the door and say we have this offer and we need an extra $800 million--can you accommodate?

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Mr. Marc Garneau: The situation is that--these are early days--we tend to go forward with a memo to cabinet saying there is a project. In the case of Mars, it's going to go this winter because there will be some spending in this fiscal year coming, 2003-04, and then it builds up and peaks around 2008, and then it starts to come down. We can cover the first year because it's a small amount, but then it ramps up very quickly.

So when we present everything in these plans and priorities, we have to show that we are working within our existing envelope. We can't put in things there that burst through that $300 million ceiling. What we do is go forward and see if we can get the funding, and if we get the funding, that changes our funding envelope and we show once again that we will stay within that.

Does that make sense?

Ms. Val Meredith: Yes, it does actually.

My constituency is right on the border. Amtrak came through--I guess it was probably late summer--with an art train. It was called the space train. Amtrak had provided two or three cars full of space photography, art work, and what not. That's how they were promoting it.

Maybe a corporate entity could take it on as an educational or advertising promotional thing on your behalf. Rather than you spending your own money, get some other corporate entity to spend its money to help you out on that.

Mr. Marc Garneau: We'll follow up on that. I'll talk to Mr. Pelletier to see if VIA Rail is ready to help.

Ms. Val Meredith: It never hurts to ask. It was very well received in the communities. It goes from community to community and stops. I think it was there for a couple of days so the school kids could go through it.

Mr. Marc Garneau: I will say that there are some tremendous organizations in this country. I just came from the Odyssium in Edmonton, and I've been to the space centre in Vancouver. I've been to Science North in Sudbury. There is the Cosmodome in Montreal. There are a lot of organizations in the country that have put together some really fantastic sites, and there is a lot of volunteering involved here. They're not getting financed. They are a bit, but they're doing a lot of this because they're enthusiastic about it, and they're always met with great interest.

A travelling exhibit is something that has been done in the United States, and we've talked about it here. I agree with you, it has a lot of possibilities.

Ms. Val Meredith: Thank you, and thank you for coming.

The Vice-Chair (Ms. Beth Phinney): Thank you, Mr. Garneau.

Mr. Mayfield, you're going to have the last word here.

Mr. Philip Mayfield: Thank you very much. I appreciate that very much.

It is so exciting to listen to you talk about plans like that, but my question now is a bit of backfilling beyond that. We've mentioned the delays that will be caused by the accident on the weekend, but without considering that, time is money. Delays cost money. There have always been delays in the program for one reason or another. I'm wondering how big a chunk of your budget these delays eat up. Do you have any estimate on that?

Mr. Marc Garneau: Not off the top of my head, but delays cost money, you're quite right, and in the space business, where we are very often on the leading edge--I know it's a tired cliché, but it is a fact, that's where we work all the time--we're in a high-risk business. Delays do occur and will continue to occur, and they do cause expenses.

We can put some kind of assessment together for you, if you wish.

Mr. Philip Mayfield: Well, I was just thinking, because it is a constant factor for you, you probably have those delays built into your budget somehow.

Mr. Marc Garneau: We do.

Mr. Philip Mayfield: I'm wondering if you could just tell us about that aspect of the budget. How much do you allow for delays, on average?

Mr. Marc Garneau: We build it into our risk management structure. Risk is there to cover a number of things. But that is considered part of the risk, and it entails cost.

I can't tell you right off the top of my head, but we can dig up something that will answer your question.

Mr. Philip Mayfield: I wonder if you could just send it to the clerk of our committee.

Thank you very much.

The Vice-Chair (Ms. Beth Phinney): Thank you very much, Mr. Mayfield.

If there are no other questions, I would like to allow our witnesses to make closing remarks, if they wish.

Mr. Flageole, we'll start with you.

Mr. Richard Flageole: Thank you, Madam Chair.

As I mentioned before, we were very happy with the reaction of the agency. They still have a fair amount of work to do to complete that transition, to put together the management systems and practices that we would expect from an organization like the agency.

From the responses we received, I think they're really on the right track. Again, we mention the positive attitude to change that we observed during the audit. We were quite pleased by the commitment of the agency and the reference to the action plan, with a specific timetable. So I think it's a positive step in the right direction, and we will certainly be going back to the agency in the future to see how much progress they're making in addressing our recommendations.

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The Vice-Chair (Ms. Beth Phinney): Thank you very much.

Mr. Garneau.

Mr. Marc Garneau: I will only add that I have four more years in my mandate, unless I get kicked out, and I intend to make sure that the Auditor General is happy with our performance the next time she or he comes around.

The Vice-Chair (Ms. Beth Phinney): Thank you very much. We're pleased to hear that.

I would again like to thank the witnesses for coming, and particularly Mr. Garneau. I know you were given the opportunity this morning; we contacted the industry department and said that if you didn't want to come, we could make arrangements. But you came anyway. You're very positive, and you sound like a man who really loves his job.

Good luck.

Mr. Marc Garneau: Thank you very much.

The Vice-Chair (Ms. Beth Phinney): The meeting is adjourned to the call of the chair.