:
I think it's now appropriate to call the meeting to order.
I want to welcome everyone here and welcome the witnesses. This meeting is pursuant to Standing Order 108, dealing with chapter 4, “Managing the Coast Guard Fleet and Marine Navigational Services--Fisheries and Oceans Canada”. That's in the February 2007 Report of the Auditor General of Canada.
We have deputy auditor general John Wiersema with us from the Office of the Auditor General. Welcome, Mr. Wiersema. He is accompanied by John O'Brien, the principal.
From the Department of Fisheries and Oceans, we have the deputy minister and accounting officer, Michelle d'Auray. She is accompanied by George Da Pont, commissioner of the Canadian Coast Guard, and also Charles Gadula, the deputy commissioner.
I want to extend, on behalf of the committee, a warm welcome to each and every one of you.
What I plan to do is to take this meeting until 12:45 p.m., and then we're going to deal with Mr. Wrzesnewskyj's motion. We are now going to--
:
No, I'm talking about when you went into Mr. Wrzesnewskyj's motion. I pointed out that the clock was past the normal hour of adjournment, and you said the committee continues until the business is finished.
Now, as I've pointed out, I could have continued on with the witnesses forever because of the nature of the debate. So I think committees have a two-hour period, at which time is the normal hour of adjournment--we just had to wait until the previous committee exited the room--and I come here with specific intentions of being here for two hours; I've other commitments, and I can't juggle them at the last minute.
So I just want to know, Mr. Chairman, does the committee adjourn at the normal hour of adjournment or at some other time, at the chair's call?
:
Good morning, Mr. Chairman.
Thank you for this opportunity to discuss chapter 4 of our February 2007 report. As you indicated, joining me today is John O'Brien, the principal responsible for our office in Halifax.
In this status report, Mr. Chairman, we concluded that Fisheries and Oceans Canada, in particular the Canadian Coast Guard, had not made satisfactory progress in implementing recommendations from two of our previous audits. Those audits were chapter 31, on fleet management, of our December 2000 report, and chapter 2 of our December 2002 report, on contributing to safe and efficient marine navigation.
Mr. Chairman, I should point out we completed our detailed audit work for this chapter in 2006. As a result, our ability to comment on developments in the coast guard since then is somewhat limited.
The coast guard plays a number of important roles. It provides marine navigation services, such as aids to navigation and marine communications, to mariners in Canadian waters. The coast guard also uses its fleet of large vessels to deliver its own programs, such as icebreaking and offshore search and rescue. These vessels also support other programs within Fisheries and Oceans Canada, such as science and fisheries management, and provide assistance to other government departments.
In our earlier reports, we concluded that Fisheries and Oceans Canada had not managed its fleet and its marine navigation services cost-effectively. We made 13 recommendations in our 2000 and 2002 reports, 12 of which remained the department's responsibility. The department accepted all our recommendations and made a commitment to take action.
The following are our key findings from our February 2007 report. First, the coast guard was having limited success in developing a national approach to managing its operations. Modernization of marine navigation services was proceeding slowly and the fleet was aging, and reliability and rising operating costs were going to continue to be issues.
After concluding that progress in implementing our recommendations was unsatisfactory, we focused our attention on identifying the underlying causes.
[Translation]
We found that the coast guard started, but did not complete initiatives, many of which were designed to address issues that we previously raised. We identified three reasons for the coast guard's lack of progress. First of all, the coast guard accepted assigned duties even when there was no realistic way for it to fulfill them. For example, the coast guard developed a plan for a special operating agency, even though it did not have the resources it needed to implement a plan. Not surprisingly, we found that many elements of this plan were unfinished well after the expected completion date.
Secondly, the coast guard did not prioritize its actions. For example, the coast guard attempted to address all of our recommendations to improve management of its fleet at once. These initiatives stalled at various stages of completion. Finally, while the coast guard made commitments to resolve management problems and complete initiatives, it lacked both the organizational and individual accountability needed to achieve them.
You will note that we have made only one recommendation in this chapter. We did this because the coast guard has limited resources and must focus those it has on key issues, including those we have previously reported. Therefore, we recommend that it establish its priorities for improvement, set clear achievable goals for each priority, allocate sufficient and appropriate resources to each priority, and ensure that managers and organizational units are accountable for achieving expected results.
[English]
Shortly after we completed our audit, the coast guard developed its first three-year business plan. The plan included a long-term approach to address the challenges, including those we reported. It established priorities, allocated resources to these priorities, and identified accountable managers and organizational units.
Subsequently, the coast guard provided your committee with a copy of its mid-year review of its business plan. We are pleased to see the coast guard is monitoring and reporting its progress and that it has shared its plans and progress reports with your committee and other interested parties.
We have reviewed the coast guard's plans and progress reports. However, as I indicated previously, we have not done audit work in this area since 2006, so our ability to comment on the plans and the results achieved is limited.
In conclusion, Mr. Chairman, I encourage the committee to review the coast guard's business plan and mid-year review and inquire about its future plans to address the issues we have identified.
Mr. Chairman, this concludes my opening statement. Mr. O'Brien and I would be pleased to answer your questions.
:
Thank you, Mr. Chair and members of the committee.
[Translation]
I appreciate this opportunity to come before you today to answer questions and address the issues raised in the Auditor General's report of February 2007.
[English]
You have introduced my colleagues, but with me are commissioner George Da Pont, and la sous-commissaire, Monsieur Charles Gadula.
Let me start by indicating that both the commissioner and I fully accept the findings of the Auditor General. I will also state thathas given us clear direction to deal with these issues. He has asked that we develop a realistic plan for responding, assign clear responsibilities and timeframes for the follow-up actions, and that we provide him with regular progress reports. The coast guard has done this through the development of an integrated and comprehensive business plan that establishes the priorities, sets clear accountabilities and timeframes, and allocates the resources required to ensure the commitments can be implemented, not just for dealing with the issues raised by the Auditor General, which are important, but also for the full range of its programs and services.
In addition, the coast guard will provide the minister with a detailed progress report on its business plan twice a year, one in the fall as part of the mid-year review, and one in the spring after the close of the fiscal year.
[Translation]
Mr. Chairman, as Mr. Wiersema has said, the coast guard business plan and its first mid-year review from last fall have been tabled with this committee. They have also been shared with the Standing Committee on Fisheries and Oceans, the Office of the Auditor General, the Treasury Board Secretariat and the main users of coast guard programs and services. In addition, both are available to the general public on the coast guard website.
The minister, the department and the coast guard are all committed to full transparency and accountability both for the programs and services that the coast guard delivers and for addressing effectively the issues raised by the Auditor General. The general feedback that we have received so far indicates that we are on the right track and that the plan provides a good framework for responding to the Auditor General's findings, within a reasonable timeframe.
This is clearly indicated in the overview that is provided in the status report. What has been done is in green, what is to be done is in yellow, and the deadlines or outcomes that have only been partially completed are identified in red. We are, in fact, very transparent.
[English]
Addressing the findings of the Auditor General will take time, as many of the management measures, especially those relating to the standardization of business practices, will require, and are requiring, significant cultural change within the agency. In fact, we anticipate that it will take three to four years to fully address all the issues that have been raised. However, progress has been made on a number of fronts, and the commissioner and his management team and I are committed to the coast guard becoming the strong national institution that Canadians deserve.
Commissioner Da Pont will now briefly set out some of the key initiatives that are under way to respond to the Auditor General's report.
:
Thank you, Deputy Minister. I appreciate the opportunity to address the committee briefly.
Naturally, I was disappointed with the findings of the Auditor General. I wish that we had done better. However, I was not surprised. The findings fairly closely resemble some of the main conclusions that had arisen from an A-base review that we conducted in 2006, and we had already started to act on some of the key issues. I would like to comment briefly on four areas.
[English]
First, one of the most important challenges is to come to grips with the observation that we operate as five coast guards rather than one. I do not dispute the finding. In almost every area of activity we do seem to do things differently from one part of the country to another.
A significant first step was taken in 2003 when it was announced that the coast guard would become a special operating agency within DFO. This put in place the framework for the coast guard to operate as a client-focused national institution. Our business plan sets out a number of specific measures tied to this objective. Specifically, we have begun an engagement with our clients to ensure consistent application of our levels of service. We have set up structured advisory bodies to get feedback and establish accountability for our service delivery. We have begun to standardize our organizational and service delivery structure, the management of our fleet, our business practices, and our administrative procedures.
In each of these areas we have identified specific yearly commitments and we are tracking and monitoring progress against those commitments. We are at the start of these processes, and as the deputy minister had noted, it will take us several years to complete all of them.
[Translation]
Second, we have also made progress on the renewal of our fleet. In the last three years we have seen investments of well over $1 billion to acquire 17 new vessels, including the announcement in the recent budget of the replacement of the Louis S. St-Laurent, our largest and most capable icebreaker.
While this is very welcome news, it will be several years before the first of these new vessels arrive. In the meantime, we recognize, as the Auditor General has noted, that we have to improve the maintenance of our existing fleet. We have started by putting better planning and money into this activity, including conducting structured vessel condition surveys, and we have launched a maintenance review to recommend how best to deal with the maintenance issues raised by the Auditor General. I expect the results of that review by the end of the month. In taking this approach, I sought the comment of the Office of the Auditor General before I established the terms of reference for that review.
[English]
Third, with respect to our modernization initiatives, we have grouped them under one umbrella, which we call aids to navigation for the 21st century. We have made some progress in this area. For example, we have converted close to 90% of our lighted floating aids to light-emitting diode technology, up from 34% in 2002. We have also converted nearly 75% of our buoys from steel to plastic, up from 51% in 2002, thereby greatly reducing handling and maintenance costs in both areas.
Our business plan sets out specific and measurable initiatives to ensure that we continue to make steady progress. A key piece of the AToN21 initiative is to develop the vision for e-navigation in consultation with our clients. A draft has been completed, and we intend to consult industry on it in the coming year.
Finally, we have put a very concerted effort into how we manage our human resources. The strength of the coast guard is its dedicated and professional workforce. We have made this a key priority in our business plan. The most significant commitment is to develop, for the first time, a strategic human resources plan for the agency that will help us focus on effective management of our people, on their training and career development, and on meeting the significant recruitment challenges we will face over the next few years.
Some of the most challenging human resource issues raised by the Auditor General concern the management of our sea-going personnel. Our ships officers and ships crew are represented by two bargaining agents with different philosophies, priorities, and goals. We are working with the Treasury Board, through the collective bargaining process, to get common language for similar provisions of their respective collective agreements and to work toward equal application to both groups working on the same vessels.
In addition, the coast guard will finalize a standard regional organization by the end of the month and will implement that standard model in the coming years.
Before I conclude, I would like to note the pride that I have in all of the employees of the coast guard who serve Canadians. We deliver essential services on all coasts, often in challenging conditions and in remote areas. Many of those services are delivered 24 hours a day, seven days a week. Most of the observations noted by the Auditor General relate to our internal management and administrative practices. I would hope they are not taken to reflect on the professional and dedicated men and women who work in the field and who have established our proud tradition of service excellence.
[Translation]
Mr. Chairman, this concludes our prepared remarks. We would be pleased to answer any questions that you or the members of the committee might have.
:
I would say there are probably about three areas of significance.
One area is the one you mentioned in terms of implementing and taking advantage of new technologies that can allow you to do things in a different way and often with a lesser cost. For example, we know and we've seen that the technologies now in terms of global positioning and so forth have taken the search out of a lot of search and rescue cases. So there are a variety of areas like that where we can be more effective.
The second general area is probably the one noted in terms of how we do some of our crewing. One of the observations, which I do agree with, is that from one part of the country to another, for similar vessels, we have different crewing postures for different arrangements, with different cost structures. I think it is reasonable to look at those sorts of arrangements and look at the best efficiency.
The third area is, I think, extremely difficult for us. As the Auditor General has noted, we have more shore-based infrastructure than we actually need to support the operations. We've had a great deal of difficulty in terms of shedding the unnecessary infrastructure, for very legitimate reasons. Some things, like lighthouses, are seen as having very important heritage and local considerations. Others relate to jobs in small communities. Those are very legitimate reasons, but at the same time we have had to invest more in our shore infrastructure--not being able to rationalize some of these things--and that does affect our cost-effectiveness.
:
Yes, Mr. Chairman, I think so.
Fundamentally, the coast guard needs to have the accounting systems to understand and analyze its costs and to be able to make the convincing business case to the Treasury Board Secretariat, and ultimately the Treasury Board and Parliament, to secure the funding it needs. It needs the information, on a national basis, to really understand the costs, the drivers of those costs, and how they change in response to change of circumstances.
For example, I have no doubt that right now the coast guard is facing significant challenges dealing with increased fuel prices. The recent spike in fuel prices is going to have a significant impact on the coast guard's ability to keep its fleet operational and at sea. The coast guard needs to understand those costs, what's driving those costs, the impact they will have on its operations, and where it has flexibility to curtail operations in order to live within its budget.
It is a harsh judgment, but we think it's particularly important for an operational department like the coast guard to really have an understanding of its costs and to explain how they change in response to a change in circumstances.
:
Thank you, Mr. Chairman.
In going through this report, it saddens me to think the senior administration at coast guard seems to be sitting there looking out the window rather than doing what they were supposed to do over the last number of years. This is a serious condemnation for the third time, fourth time, that you still aren't serious about getting the job done, and I'm getting a little bit upset about this.
I happened to read in the Auditor General's report, in paragraph 4.19, where it said, “A 1983”--25 years ago--“Auditor General's report raised a number of the same issues we raised in our 2000 and 2002 reports.” Here we are in 2008, and you can't get the job done. What's going on over there? Who's taking this job seriously?
:
No. Mr. Da Pont, the Auditor General has pointed out that it's a management problem. I'm certainly glad to hear that the men and women who are out at sea defending our coasts are doing a great job, but Mr. Chairman, they seem to be out at sea because management isn't following along in knowing what's going on.
I take a look at exhibit 4.1 of the Auditor General's report, where you don't get one single credit for a satisfactory performance, not one. On every one of these, in the Auditor General's report of 2000 and the Auditor General's report of 2002, on the progress in implementing the recommendations, which the government accepted, satisfactory progress has not been made--not on one of them.
So how can you pat yourself on the back and say you're doing a great job when this is in the report? It seems it takes the landlubbers from the Auditor General's office to go out there and kick your derrière to get some progress.
So what's the problem? Why is it taking so long, and how can we be assured that things are going to be better from here on in?
:
Thank you, Chair. I'll be sharing my time with my colleague Mr. Stoffer.
Thank you all for your presentations today.
I have to tell you, it's been a long time since we've had one this bad. For a while they seemed to come in fast and furious, and then we went off on something else, and now we're back again with this kind of absolutely unacceptable...well, there are lots of words that could be used.
I want to revisit where we were on exhibit 4.1 again. I haven't heard satisfactory answers. I appreciate what's being said about going forward, and we're going to hold that to account. But in terms of accountability, I want some held right now. I want to know why these things were not done. It's not good enough just to say that what you did before wasn't acceptable and that it's going to be okay in the future. I want some accountability right now from the commissioner or the deputy. I want them to take responsibility for why 12 out 13 items in two previous audits have not been done. Why is this?
:
Maybe I could start, Mr. Chairman.
The first point I would like to make is that a lot of work was done on all of these things; none were completed. We tabled with this committee our business plan with a status report, as of February of last year, of what had been done on the items and what remained to be done. It was not a case of not moving on any of the items; a significant amount of work was done on all of them.
I think there are probably three things I would say. It risks sounding like an excuse, and I don't want it to, but I do think the Auditor General was right in observing that we made a fundamental mistake at the beginning in trying to work simultaneously on all the recommendations.
A number of those recommendations were very significant. They required a great deal of work, and they required a significant amount of cultural change within the organization. We tried to do everything at the same time. We did a lot of things; we didn't finish anything. I think that is one factor.
Second is that during that period the coast guard was also undergoing other significant changes, which took a significant amount of management time. The coast guard became a special operating agency within DFO; a portion of responsibilities for navigable waters and the Office of Boating Safety was transferred to Transport Canada.
As I think the committee appreciates, executing those sorts of issues does take a fair bit of time. We also were involved in significant internal review processes, particularly the expenditure review committee process.
I don't want to offer these as excuses, because they're not intended to be, but they are explanations for why management was not as focused on some of this as it should have been.
:
I would agree, Mr. Chair, that is the case. However, I would also point out to the members of the committee that we have tabled a business plan. We have indicated our status report against that business plan, and we have been very clear about the areas we have met.
One of the comments the Auditor General made to us, very rightly--and as Mr. Da Pont has indicated--is that when we try to do everything at once, which we have been told is something the coast guard has as an attitude, we can do everything, but it means that we often do everything halfway.
We have now established some pretty clear benchmarks, some achievable elements, and we are working towards them. It's perhaps not as fast as everyone would like; that's correct as well. But changing the responsibility elements within an organization, for example, having everybody in the regions report to the commissioner, was a significant change. There is a line authority now that was not there before.
:
Mr. Chairman, when I read a report like this, I always think of Fidel Castro's famous words, that if you can't shoot them, you have to educate them. Somebody in the coast guard has to be educated.
When I hear a report that says the Auditor General identified three examples of poor maintenance and lost or badly written manuals that resulted in over $8 million wasted..... If they can't handle this simple task, how can they handle complex tasks like guarding our coast? When the general public hears that, they get very, very nervous, and so does our largest trading ally, the United States. That's just a comment.
I have a copy of the Conservative platform of 2006. It says that they will establish the Canadian Coast Guard as a stand-alone agency. Madame d'Auray or Monsieur Da Pont, have you been given instruction by the government that you will now become a stand-alone agency? Since the 1995 merger with DFO, the people I speak to at the Dartmouth base and bases across the country have indicated that although it was different merging the two cultures together, in many cases it has been nothing but an unmitigated disaster. The Auditor General report has proven that.
So have you been given instruction to become a stand-alone agency?
When the men and women of the coast guard look at this report and read the transcripts of this committee meeting, I think they'll be quite disappointed. So I thought I'd just take a quick moment off the top and express what I think are the views of most committee members, who are all tremendously appreciative of those men and women on the front lines of the coast guard. They do very difficult work, and they try their best, at times in very hostile or difficult environments.
What we don't expect is that the internal structures would create a difficult, hostile environment in which they're expected to do their work.
The coast guard is facing three major challenges: rust-out of its ships; inability to provide timely and accurate information on fish stocks, and that has huge repercussions; and a new challenge, a very serious challenge. Our biggest coast is in the Arctic, and with the melting ice cap, there is going to be a huge coast and a large territory to patrol. From my reading of this report, it's difficult to envision how your agency will be able to meet those particular challenges.
Perhaps what was most interesting in your opening address was that you noted that a cultural change within the agency was necessary. That's perhaps getting at the real substance of things. And you anticipate that it will take you three to four years for this cultural change. Do you have an action plan on this particular aspect of the challenges you face? And if you do, could you please table it with this committee?
:
Mr. Chairman, everything we are planning to do is in the business plan we tabled. And for the very specific items of standardization and so forth, we have identified the specific commitments.
We will be tabling with this committee, I would expect by mid-May, our updated business plan for 2008-09. One of the initiatives you will see in that business plan, which is a new initiative, is to spend probably a year or two within the agency on revisiting our mission, our mandate, and our values. That exercise is intended to get at the issue you're raising, quite legitimately, of looking at beginning to get the cultural change within the coast guard, to have people look at the coast guard more as a national institution rather than one focused entirely on their region, or their vessel, or their part of the coast guard.
I think that's one of the most significant issues, because the coast guard does have a very strong can-do attitude. It needs—and it would be a mistake not to have—a lot of operational flexibility in the field, and it is balancing it with that national outlook and standardization.
:
I guess what I would say is that I think there has been significant change. Becoming a special operating agency was very significant. Becoming a line operation as part of that was very significant. Having policy and regulatory responsibilities move to Transport Canada so that the coast guard could focus exclusively on service delivery was very significant.
We have seen, in the past three budgets, an investment of almost a billion and a half dollars in the coast guard. I think that's extremely significant. It begins to provide some improvements in terms of getting new vessels and so forth.
So I think it is more than just the cultural change. It's been accompanied by very significant organizational changes. It's been accompanied by very significant investment in the last few years.
The final thing I would say is that beginning next year, we're going to implement a standard organizational structure across the coast guard. That also is a very significant change.
So I do think there are a lot of concrete elements, not just the cultural change part.
:
Mr. Chairman, we have looked at comparisons with other coast guards around the world, and we have regular meetings in both the north Atlantic and the north Pacific.
Going specifically to the crewing systems we have, they're all negotiated on our behalf by someone else, as you know. We ended up with the lay-day system, with a 2.1 clause in it. As a result, we now get 18 weeks' work out of an individual.
It's a problem for us, and it's an issue we're looking at now from a strategic point of view, trying to clarify, with those who bargain the collective agreements, the need to have a lay-day system that's comparable with other organizations but that, in the end, would result in a true day-on/day-off scenario. But we are burdened at the moment with the four different operational systems that we use.
In response to your question, in the late 1960s and early 1970s, for instance, when I first went on board our ships, we had only conventional manning. You got your annual leave of three weeks a year and you were away the rest of the time. Times are different now. We are trying to build collective agreements strategically, for both ships' officers and crews, that are fair, that allow us to recruit the professionals we need, but that at the same time don't tie our hands with respect to the availability of crew and the ability to operate 24/7 operations where required, and as well to have seasonal operations that make sense in the areas of Canada where we do have seasonal operations.
:
Thank you, Mr. Chairman.
I think you certainly hear loud and clear, from the entire committee, that this kind of report is more than troublesome. This isn't a 6.9 or anything; absolutely no satisfactory performance has been made.
My real concern, as it goes back to 1983, is that the cultural change you mentioned is an endemic problem. I guess the overall question...and maybe I'll save that as the last question I have you answer.
We really need to know what is different today when this department has repeatedly come back, report after report, and said they were going to make it happen. The last year an action plan was actually submitted was 2002. What's going to be the difference today, over all the rest of those times, so that progress is really going to be made?
Before you answer that, as maybe a closing statement for my round, on pages 10 and 11 there's the sad tale of some seriously flawed maintenance. It not only cost millions and millions of dollars, but it also risked the lives of crew on these vessels. Is the maintenance scheduling--I'm hoping, actually, you're going to tell me that the manuals are in place—a key priority? Is making sure these vessels are kept up to date, not only mechanically but safety-wise out of concern for the crew, one of the key priorities in your plan going forward?
:
No. As the Auditor General has noted, some are not up to date. There are varying reasons for why that's the case, which I won't bother to go into. But we have made that a significant priority, and we are looking at that comprehensively.
Each of the incidents on page 10 and 11 were investigated. There were recommendations, and the recommendations were implemented. But I launched an internal maintenance review, because beyond these specific incidents there may be some structural, fundamental issues. I've been briefed on the progress of that.
One of the issues, in fairness to the people doing the work and with regard to some of the observations, is that in the last number of years, after program review, we cut significantly the number of people on the vessels, the number of people engaged in these activities. That was happening at the same time as the vessels were getting older and as the requirements for maintenance--the workload--were rising.
So beyond the very specific issue of manuals and so forth, I think there's probably a more fundamental issue we need to come to grips with. I'm beginning to wonder whether we may not have enough people on those activities, given the workload and the increased workload because of aging vessels.
:
Thank you, Mr. Chairman.
I'm looking at paragraphs 4.52 and 4.53, about the director general of integrated technical services, who apparently reported, “Many of the catastrophic failures that have occurred over the past several years were avoidable.” He goes on to say, “while the recapitalization of any asset base is critical, the various failures have not been caused by age alone, but by the lack of even the most fundamental materiel management system.”
The next paragraph says that the coast guard is going to have this all fixed up by March 31, 2007, which of course begs the question, has it been done?
:
Okay, so you have that completed.
I'm going to ask one final question, Mr. Chairman, because I know my time is very limited.
It seems to me the last time the coast guard commissioner was here he said that every ship that approaches our shores is required to radio ahead telling us that they're coming. Then of course, he went on to say that really these boats that bring in boatloads of illegal immigrants and boatloads of illegal drugs haven't been radioing ahead to say they are coming, and we have no real means of identifying that they're on their way.
Do we now have any means of identifying that boatloads of illegal immigrants and boatloads of illegal drugs are on their way, in case they don't tell us that they're coming?
:
I have another more pressing question.
I am particularly interested in the issue of fleet renewal. We are currently in the process of purchasing 17 ships. It has been noted that the process is very slow, that there may be delivery delays, etc.
We are in the process of buying a ship in Vancouver. We are now on the third set of performance specifications. We want to buy a ship, but we are proceeding through performance specifications. Therefore, we do not have a plan. We are asking suppliers to give us plans and costs. I can understand that the process is slow, if we do not know what we want to buy at the outset and if we are proceeding through performance specifications.
Have you been informed of this process?
:
Thank you very much, Mr. Chairman.
Again, on page 14 of the report, one of the biggest concerns is that scientists and the are making quota allocations or decisions on fisheries using unreliable information.
Regarding the maintenance concerns of those vessels, opening up a limited fishery in an area that hasn't been properly surveyed and without having the scientific information could be very damaging to fish stocks. So I would hope we don't see something like that again.
But Mr. Da Pont, in a previous committee you and I talked a lot about the moving of the icebreakers from the Halifax region over into St. John's and Argentia. And you have indicated that though there's a certain limited cost in the one area, it won't be much of a cost at all--although people within your department have publicly said that's simply not true.
You issued those reports of the cost analysis to the DFO committee. I was hoping you'd be able to bring one to this committee as well, and that the committee, Mr. Chairman, would ask the Auditor General to look into this prior to the actual move happening in order to ensure that what they say about the cost will definitely be the truth, and that we won't find out six months later, “Oh well, we didn't know about this dredging, or the expansion of a wharf” or something of that nature. We know those things have to happen. But they're being very optimistic that the cost will be almost negligible for the St. John's area.
My question for you is this--and this is all a matter of trust now, Mr. Da Pont and Madam d'Auray. How much money are you going to go to the Treasury Board and ask for? You said you need more resources. You should know the answer of how much money Treasury Board needs to give you in order for you to do your job, so that we don't have a report like this again in the future.
Is it $10 million, $20 million?
:
I have a quick question.
Commissioner, your opening comments speak to trust, so I'd ask you to comment on this. You said today that “a significant first step was taken in 2003 when it was announced that the Coast Guard would become a special operating agency within DFO.” If we took that as a stand-alone, that would sound like a good thing. You have used the word “significant” a number of times today.
But the statement made by the deputy auditor general today said that, “for example, the coast guard developed a plan for a special operating agency”--which you took the bow for--“even though it did not have the resources it needed to implement the plan. Not surprisingly we found that many elements of this plan were unfinished well after the expected completion date.”
Now, this--because it's your statement--in conjunction with the issue that two of my colleagues have raised about it being a year over date, has happened during your time, sir. We want to have a comfort level that you're actually going to ensure that the promises made this time are really kept. Yet there are a couple of flies in the ointment already. Can you comment on the discrepancy between your bragging about what's done and then the deputy auditor general's saying today--in the same hour--that this was one of the problems? It somewhat speaks to our relationship with you and our trust level.
:
Thank you, Mr. Chairman.
Mr. Da Pont, Mr. Stoffer asked you if you had developed a clear presentation to go to Treasury Board or whomever to say that in order to be a really functional organization through the mandate given to you, this is what you need, and this is what you're going for. You came back and said you were trying to figure out how to accommodate the increase in fuel prices, and you totally avoided Mr. Stoffer's question.
You now, according to the Auditor General and perhaps according to you, know what is required to run the coast guard to the standards determined by the Government of Canada. Have you made a submission to the Treasury Board or to the department--since you are an SOA--saying that this is what you need to do the job they expect of you?
:
We can only hope that is not going to take too long, because the coast guard does perform a vital service to this country.
Mr. Da Pont, you mentioned, of course, that the maintenance is a problem because you may not have enough people. I was quite troubled by the word “may”, because you've been dealing with this problem for years and years, and you still haven't figured out if you have a shortage of manpower or if you don't have a shortage of manpower, or if they're just ill-trained and ill-equipped and in the wrong place at the wrong time. I don't know what the problem is.
But when are we going to get definitive statements from the coast guard of, yes, we see the problem, we have identified how to fix it, and we're going to get it fixed? When are we going to get that kind of language?
:
They took a look at us, and having an independent observer giving us their advice was very helpful.
What came out of it—and I know you probably won't like this answer—was a need to actually do a structured review of how we do our maintenance. We have been doing that for the past year, in-house, involving mostly our people in the field and the experts on the vessels. I expect to have the result of that by the end of the month.
My view is that I need to understand very clearly to develop the type of business case that the deputy minister was talking about. I need to be able to substantiate it by having gone through a very structured process. As the Auditor General noted, one of our failures has often been that we haven't actually taken the time to do our homework on some of these things, and as a result, we perhaps have not been as successful in dealing with central agents as we should.
What I do want to say is that I'm very committed to dealing with these issues. We have a plan. We are being very transparent. We are reporting consistently against this plan. I do take full accountability for it.
:
I will be very brief, Mr. Chair. I have two comments before I go into the closing remarks.
The first is that one of the members requested the regional breakdown in the business plan, and it is actually on page 66, so that the costs, the regional spread, are there.
With regard to the lighthouses and their divestiture, I believe there is a bill that will be going to the Standing Committee on Fisheries and Oceans with regard to lighthouse divestitures and heritage protection as well.
In closing, I think a number of members have rightly asked us if we are accountable, and the answer is yes. Will we take the responsibility? We do. Do we take it seriously? Absolutely. Is it easy? No. Are the changes that have been identified to be made significant, to use that term? Yes, they are. Are we making progress? Yes.
Is it satisfactory according to the report of the Auditor General, which was done in 2006 and reported in 2007? No. Have we made progress since then? I would absolutely say yes. Do you have our commitment for that progress to continue? Yes. What are the changes we have seen? We have seen the organization become a special operating agency. Yes, it is within the department, but with its own fenced-in budget.
We have seen changes in terms of our ability to move capital money forward and re-profile as necessary. We've seen changes in terms of the maintenance capacity and understanding of the issues. We have a more focused mandate; a lot of the policy issues have been transferred to Transport Canada. We are now clearly focused on the key operational elements.
We have line reporting, which we did not have before. We now have the capacity to replace 17 of the 40 vessels, again a major issue that had been identified. And we are actually at the point of reporting on a regular basis, in a very transparent fashion, on the goals we have set ourselves, the results we seek to achieve, and whether or not we're making them.
I think the motion is self-explanatory. Perhaps I could add a couple of words to the motion.
The Honourable Jim Flaherty, Canada's , is not a rookie politician. In fact, he's quite the opposite. He's a very experienced politician. That's why it's quite worrisome that there was this violation of Treasury Board guidelines.
Even more perplexing and worrisome is the explanation that this was fine because there was value for money. We know that Mr. MacPhie, a long-time Conservative stalwart going back to the time of Mr. Harris, obviously got tremendous value for the money he received. Perhaps there's a long-standing relationship with the minister. Perhaps there was value for money for the minister. But I'm not convinced that this renders value for money for the Canadian taxpayer.
Secondly, even more worrisome is that after an admission of violation of Treasury Board guidelines, we've seen through access to information documents that there has been a series of these contracts just below the $25,000 limit. This is something similar to what we saw in the RCMP investigation of pension insurance funds, when we talked about the rigged contracting system. We saw a similar pattern of nudging just below the limit.
Instead of addressing this violation thoroughly and making sure that in the future these sorts of things do not occur, we've seen a new manner in which to circumvent Treasury Board guidelines. This is why I think it's incumbent upon us to bring the minister before us.
:
Thank you, Mr. Chairman.
I appreciate where Mr. Wrzesnewskyj is coming from. First of all, Mr. Flaherty, the , apologized not to the committee but to the House of Commons for breaking the Treasury Board guidelines, in that there was a contract for well in excess of the $25,000 limit for untendered contracts. Not only did he apologize, but he made a clear, categorical statement that he wouldn't do it again.
I'm not sure what Mr. Wrzesnewskyj wants beyond an apology and a commitment that it will not happen again. I don't know what he intends to do.
With regard to the Treasury Board guidelines of $25,000 for untendered contracts, that is the rule. If the contract is awarded for less than $25,000, that is not breaking Treasury Board guidelines; that's living within the guidelines.
Now, some people may say there's a perception of abuse, in that it's close to the limit, though not in excess of it. Let's remember that this is not breaking the guidelines. Therefore, it is very strange to call in the President of the Treasury Board to ask him why he didn't take any action against the . What's he supposed to take action against? The Minister of Finance lived within the Treasury Board guidelines.
The first point I want to make is that I cannot understand why the President of the Treasury Board would be called before the committee other than to reaffirm what the rules are. Well, we already know what the rules are.
I take the opposite point of view. I know speeches are valuable, and I listened to that speech in the House. When I heard later that the writing of that speech cost that much money, I just wonder what value we did get. What was the cost per page? It seems like a very significant cost to have someone write a speech.
I know we have speakers in this country who come and deliver speeches at great conventions and they're paid $50,000 or $100,000. I know certainly the government has great support for the presenter, the so-called minister. To think it cost that much to write him a speech seems extraordinary.
The fact that it was done, Mr. Williams, without any tendering process certainly shows that one of the senior ministers in our government is not able to follow the accountability and the high standard that the present government has for how it deals with business.
:
Mr. Chairman, this motion was tabled at the Standing Committee on Finance, on which I also sit. One of the reasons why we did not agree that it be studied at the Standing Committee on Finance was that we were convinced that it should come under the Standing Committee on Public Accounts.
I therefore agree on the substance of the question. However, some components of the motion are very different from the motion that was tabled at the other committee. That was much less accusatory, in part. I would like to propose a friendly amendment to Mr. Wrzesnewskyj, if he agrees. In the second paragraph, I would delete the part that talks about contracts “valued at $24,900 to Conservative Party supporters in order to bypass Treasury Board guidelines”. If we want to find out if that is what was done, we must hear from the witnesses in order to ask them, before stating it in the motion. I will read the motion as it was tabled at the Standing Committee on Finance. It said:
Furthermore, Access to Information requests have shown that the Minister of Finance awarded a disproportionate share of untendered contracts valued at between $24,000 and $24,900 and therefore falling just below the level at which contracts must be subject to competitive tendering.
Everyone knows that. I would delete the entire third paragraph. At the end of the fourth paragraph, where it says: “to appear as witnesses in order to further study these violations of Treasury Board guidelines”, I would delete the words “these violations of Treasury Board guidelines”, and say: “on these situations that appear to be contrary to Treasury Board guidelines”.
I do not know if Mr. Wrzesnewskyj will agree, but I propose this friendly amendment.
:
First of all, I think the amendment improves the motion dramatically and brings it more in line with the reality of the situation. To punish a minister or ridicule him because he came close to reaching the maximum but didn't reach it would be the equivalent of giving someone a ticket because they almost reached the speeding limit, but not quite.
Flowing from that, we really don't have much reason to bring in the police officer who, according to this motion, would be the . He is not accused of having broken any rules whatsoever. The only administrative rules that were not followed were on the one contract with regards to the budget speech, and the has already apologized for that. I fail to see why the President of the Treasury Board would have anything to do with our discussion.
I would be more inclined to support the motion if Mr. Wrzesnewskyj would accept a friendly amendment that Mr. Vic Toews be removed at this time, and he could be called later if we find that there's something in some of his conduct that would require greater scrutiny later on.
I would offer that as a friendly amendment, that we remove from this motion as a witness.
:
Mr. Chair, the first two paragraphs—the third being deleted by the first amendment—are the preamble to the actual motion itself. The motion is that we study the situations that seemed to be instances where the Treasury Board guidelines were violated—I'm not exactly sure of the terminology—but we're dealing here with government administration and Treasury Board guidelines. That's what the motion actually says, and I can't imagine why we'd bring Hugh MacPhie and Sara Beth Mintz here to tell us about Treasury Board guidelines.
Also, Mr. Chairman, as I said, the Minister of Finance has apologized as well.
Therefore, I would move, Mr. Chairman, that the reference to Mr. Flaherty, the Minister of Finance, Mr. Hugh MacPhie, and Sara Beth Mintz also be removed, and that we bring in Mr. Wayne Wouters, the Secretary of the Treasury Board, to explain what's going on here.