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Standing Committee on Government Operations and Estimates
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EVIDENCE
Tuesday, November 29, 2011
[Recorded by Electronic Apparatus]
[English]
We're going to call the meeting to order.
Welcome, everyone, to the 19th meeting of the Standing Committee on Government Operations and Estimates. Today we're pleased to welcome guests and visitors from the Department of Indian and Northern Affairs who will be speaking to supplementary estimates (B).
Who is the head of your delegation?
You are Susan MacGowan, chief financial officer?
Perhaps in the context of your remarks you can introduce the rest of your delegation for the record.
I would invite you to give your presentation, and then we'll commence with questions from the committee members.
Ms. MacGowan.
[Translation]
First I would like to thank you, Mr. Chair, and your colleagues for inviting the department to appear before the Standing Committee on Government Operations and Estimates.
Today I am accompanied by: Patrick Borbey, Senior Assistant Deputy Minister of the Treaties and Aboriginal Government sector; Françoise Ducros, Assistant Deputy Minister of the Education and Social Development Programs and Partnerships sector; Élisabeth Châtillon, Assistant Deputy Minister of the Resolution and Individual Affairs sector; and Janet King, Assistant Deputy Minister of Northern Affairs.
[English]
As you know, I'm here today to discuss the supplementary estimates (B) for fiscal year 2011-12 for Aboriginal Affairs and Northern Development Canada, as tabled on Thursday, November 3, 2011.
The estimates, consisting of the mains and supplementary estimates, give the department the resources necessary to help improve the quality of life for aboriginal peoples and northerners. The supplementary estimates seek authority for revised spending levels during the fiscal year that Parliament will be asked to approve in an appropriation act. Access to the supplementary estimates by the department is a regular process. For this fiscal year, Aboriginal Affairs and Northern Development Canada is seeking authority for $544 million in supplementary estimates (B).
To begin with, I would like to provide you with a high-level overview of the department's activities and resources in an effort to provide you with some context.
Aboriginal Affairs and Northern Development Canada supports aboriginal peoples—first nations, Inuit, and Métis—and northerners in their efforts to improve social well-being and economic prosperity; to develop healthier, more sustainable communities; and to participate in Canada's political, social, and economic development.
AANDC is the federal department primarily responsible for meeting the Government of Canada's obligations and commitments to first nations, Inuit, and Métis, and for fulfilling the government's constitutional responsibilities in the north. The department's legal and operating environments are complex and continually evolving. AANDC delivers or funds programs and services to diverse groups of people who have varied and distinct priorities and needs and who live in a vast range of communities throughout the country, from remote settlements with extreme climates to metropolitan urban areas. Most of the department's programs, representing a majority of its spending, are delivered through partnerships with aboriginal communities and federal-provincial or federal-territorial agreements. Aboriginal Affairs and Northern Development Canada is one of numerous federal departments and agencies delivering aboriginal and northern programs and services.
Turning to the department's financial resources, the 2011-12 main estimates tabled on June 3, 2011, included approximately $7.4 billion. Of this, approximately 85% goes directly to recipients through transfer payments. Much of this funding ensures that aboriginal people have access to basic services comparable to those provided to other Canadians through provincial, municipal, and territorial governments. These services include education, housing, community infrastructure—water and sewage systems—social support services, and other benefits.
[Translation]
On behalf of the Government of Canada, AANDC is the lead department responsible for the negotiation and implementation of self-government and land claims agreements. By continuing to negotiate and implement claims and self-government agreements, the federal government improves aboriginal-Crown relations and provides Aboriginal groups with the opportunity to make meaningful changes in their communities.
[English]
The department is also responsible for the promotion of economic development and the continuation of the administration of the Indian Residential Schools Settlement Agreement as it seeks further reconciliation with former student residents of Indian residential schools, their families, and communities.
The main estimates are the first step in the fiscal cycle. Additional adjustments of $18 million were approved by Parliament as part of the 2011-12 supplementary estimates (A) for the renewal and extension of a series of Yukon comprehensive land claims, the implementation of several Yukon self-government agreements, and the implementation of the Teslin Tlingit Council Administration of Justice Agreement.
As mentioned, the investments requested in these supplementary estimates (B) would increase appropriations of the department by another $544 million and will bring total spending to nearly $8 billion for this fiscal year. Specifically, supplementary estimates (B) will provide the financial resources to take action on a number of key initiatives, and I'll now describe them briefly.
The first item of funding is $179 million related to the Residential Schools Settlement Agreement, which will allow the Government of Canada to continue fulfilling its commitment to fund awards to claimants resulting from the independent assessment process and alternative dispute resolution. The $179 million is composed of $136 million in new resources to address the increased volume of payments and $43 million that is requested to be reprofiled from the previous fiscal year. With this incremental $179 million this year, total overall funding for these settlements will reach almost $2 billion over six years. The department anticipates there will be over 2,500 decisions resulting in compensation this fiscal year.
For the second item, the Government of Canada continues to support the federal contaminated sites action plan for the assessment, management, and remediation of federal contaminated sites. The $109 million will target sites of high priority, including the Giant Mine, a former gold mine in the Northwest Territories, and the Faro Mine in the Yukon.
The third item of $95 million identified for emergency management assistance will allow the department to meet its responsibilities to assist first nations communities living on reserves in managing emergencies. This fiscal year the costs are primarily related to extraordinary spring flooding in Manitoba, Saskatchewan, and Alberta; forest fires in Ontario and Alberta; as well as storm surges in Atlantic Canada. This funding is used to reimburse first nations, emergency management organizations, provinces, other emergency management organizations, and host municipalities for the response and recovery costs incurred related to emergency situations on reserve.
On the fourth item, the department continues to address the resolution of specific claims to deal with past grievances of first nations that relate to Canada's obligations under historical treaties or the way it managed first nations funds or assets. This fiscal year the pace of the resolution of specific claims is such that the department is requesting an additional $77 million from within the $2.5 billion set aside in the government's action plan for accelerating the resolution of specific claims, “Justice at Last”.
To date, in 2011-12 the department has spent $234 million to resolve the Fort William First Nation boundary claim in northwestern Ontario—$154 million—and the Roseau River Anishinabe First Nation's 1903 surrender claim—$80 million. A number of other claims are expected to be resolved this fiscal year.
Other smaller initiatives included in these supplementary estimates are $14 million for education funding in British Columbia and Nova Scotia; $12 million to implement the Eeyou Marine Region Land Claims Agreement, once implementation legislation to bring the agreement into effect has taken place; $10 million to upgrade, replace, or repair essential fuel storage tanks in first nations communities across the country; and approximately $50 million for various initiatives, including funding for improvements in the northern regulatory system and cumulative impact monitoring program, $10 million; implementation of a prevention-focused approach for child and family services in Manitoba, $6 million; registration of applicants for Indian status as a result of Bill C-3, Gender Equity in Indian Registration Act, $6 million; and the aboriginal peoples survey, which will focus on education and employment income, $4 million.
[Translation]
In closing, I would like to thank you, Mr. Chair, and your colleagues for inviting us to appear before the committee today and permitting me this time to provide you with a summary of AANDC's activities and outline the requests in Supplementary Estimates (B). My colleagues and I would be happy to respond to questions and comments from committee members.
Thank you.
[English]
Thank you, Ms. MacGowan, for that presentation.
We will have five-minute rounds for both questions and answers. So if we could keep the answers fairly short, that will allow people more questions.
To begin with, Mathieu Ravignat for the New Democratic Party.
[Translation]
Thank you, Mr. Chair.
I would like to thank the witnesses for being here today.
As you know, the Conservative government has started making massive cuts in the various departments, especially in Aboriginal Affairs and Northern Development Canada. These cuts exist, even though a number of aboriginal communities are currently facing considerable challenges.
How might these cuts harm the communities? How will they affect the quality of your work when the time comes to help these communities? Have you specifically considered these probable cuts when making your requests for the Supplementary Estimates (B)?
[English]
The department has put in place a number of cost-containment measures to address certain of the limits within government. We are working very hard to make sure that these don't affect our communities. In fact, on the operation and management side, we have already put in measures to address IM/IT cuts, legal costs, or other items in support of government direction. We've made cuts in hospitality and conference in respect of the caps imposed. We are absorbing salary increases with respect to the operating budget freezes.
In terms of oversight within our department, we have solid governance structures where monthly we review the department's overall financial situation.
[Translation]
Thank you, Ms. MacGowan. That was very interesting.
But could you tell me if this will have an impact on the services that you provide to these communities?
[English]
With respect to the exercise the government is now undertaking in terms of the deficit reduction action plan, our minister has put forward his proposals to that particular committee. Clearly, we don't know the outcome of those, and we won't until the federal budget in the spring.
[Translation]
I recently had the honour of meeting the chief of Kitigan Zibi, Gilbert Whiteduck, in my riding.
Let's remember that the Algonquin communities of Pontiac, Lac-Barrière and Kitigan Zibi have major water problems on their reserve. The water quality problem is common to many reserves. Given all these problems, we could expect to find requests for additional expenditures to help out these communities.
Do the Supplementary Estimates include amounts set aside for the water infrastructure crisis?
[English]
These supplementary estimates don't request additional moneys in the case of water and waste water. However, the department does have programs that allocate money to projects on a priority basis. That would be the level of detail I have on that, in the context of the supplementary estimates.
[Translation]
You are asking for $179.4 million for amounts set aside for claimants following the independent evaluation process.
Do you think that there will continue to be more requests and claims in the next year? Is that one of the reasons why you added it to your expenses?
Also, how do you explain that the government has not been able to provide a more accurate estimate of the expenditures related to the program?
[English]
I'm very pleased to have the opportunity to update honourable members on the IAP implementation.
On the first part of your question, in terms of the number of applications received—we've received 23,000 applications so far and have resolved 12,000. You asked why the estimate done by the former department of Indian Residential Schools Resolution Canada in 2005 was not accurate. It was 12,000 at the time. Because this is a massive class-action settlement, there is no solid precedent for this type of program or for the content—the abuse. So at the time, the department used academic and judicial studies on institutional child abuse and determined from all the information they had that about 15% would be the level. Out of 80,000 living eligible survivors, that came to 12,000.
Five years into the program, we believe now that the level is closer to 30%, and therefore we are expecting closer to 30,000 applications by the deadline of next September.
You'll have to continue that in your next round.
For the Conservatives, the first round of questioning is to Jacques Gourde.
[Translation]
Thank you, Mr. Chair.
Thank you to the witnesses for joining us this afternoon.
For background purposes and for the benefit of Canadians, what are the major challenges facing aboriginal communities in the north? What is the Government of Canada doing to support them in light of these challenges? And lastly, please tell us about governance and how the money is transferred and administered.
[English]
Just to make sure I understood, you're asking how we support communities in the north and how funds are transferred to the north.
[Translation]
The major challenges in the north. Okay.
[English]
I will be speaking to north of 60, largely in the northern territories. In particular, small and very isolated communities, extreme weather, and limited capacity are some of the challenges they face. These challenges lead to difficult social situations that are fairly common across the north.
We support the northern communities through the programs we're responsible for in a variety of ways. We support the broad regulatory regimes in the north and both informed resource development and environmental management. So we support broad economic development in that way.
We also support the communities through governance relations with a variety of first nations. For example, in Nunavut we support the Nunavut Land Claims Agreement implementation, which then supports a suite of communities across the north.
We have a particular program to reduce the price of nutritious foods in the north called Nutrition North. It was implemented last spring as well. That's a direct program that's contributing to enhanced access to nutritious foods in the north.
[Translation]
Will development in Canada's north give aboriginal communities the opportunity to obtain sustainable jobs, good jobs, that will help them get out of this economic slump?
[English]
We expect so. First nations are involved in the consideration of and participation in many development opportunities moving forward. For example, many of the resource projects have very direct impact benefit agreements with the communities to ensure that the northerners have direct access to training, learning, resources, and so on. So we anticipate there will be very direct and positive impacts to northern communities as economic development proceeds in the north.
[Translation]
Are the training programs well suited to the reality of Canada's north? Is there a good rate of participation in the aboriginal communities? For example, are young people 15 to 25 years of age participating in these programs voluntarily, or do they need to be encouraged to go?
[English]
I won't be able to speak specifically to the age group from 15 years to 25 years, but from what we understand, there is generally increasing participation in these training opportunities. There is quite a diverse suite of them relating to territorial, community, and private sector offers of training.
Increasingly, people are being enabled to participate and become interested. Programs offered are being developed in discussion with the communities to make sure they match the needs of the demographics of the people and their community plans going forward. So best practices are being reviewed and built upon by both government and the private sector as they pursue these training opportunities.
[Translation]
Thank you, Mr. Chair.
I'd like to thank the witnesses for being here today.
The third line on page 38 indicates that Aboriginal Affairs and Northern Development Canada is requesting $95.4 million for costs incurred on reserves by provincial, territorial or other emergency management organizations as part of the emergency management assistance program.
How are the roles and responsibilities shared between Aboriginal Affairs and Norther Development Canada and the provincial and territorial governments when it comes to managing emergency situations?
[English]
There are cost-sharing agreements with a number of provinces to deal with the emergency management assistance plans, in particular Alberta, Ontario, Saskatchewan, and more recently Manitoba. There are cost-sharing agreements in place.
In previous years, many of the costs would have gone through Public Safety Canada's disaster financial assistance arrangement for reimbursement. However, this year the DFAA was not suitable as the sole funding mechanism due to the magnitude of the costs. Several first nations require assistance cash in managing their eligible costs until such time as they're reimbursed through the DFAA, and that can take three to five years.
Once there is reimbursement to provinces, then first nations expenses and AANDC mechanisms to replace or ensure there is not a duplication in funding kick into place.
I'm not sure whether that fully addresses your question.
[Translation]
Yes, thank you.
An assessment of the program conducted in 2010 showed that the financial structure of the emergency management assistance program contains some gaps. So this is problematic. It does not provide the financial assistance needed to achieve all the program objectives. This structure also leads to inefficiencies in relation to the financial assistance Aboriginal Affairs and Northern Development Canada needs to meet it legal obligations.
Has Aboriginal Affairs and Northern Development Canada done any work to improve the funding structure?
[English]
The department has moved forward in terms of improving the funding structure. There are now formalized agreements with British Columbia, Alberta, Saskatchewan, Ontario, and Manitoba. We're in the process of negotiating agreements with other provinces.
Where those agreements aren't already in place, we work with emergency management organizations and other partners—in the case of Manitoba, for example, the Manitoba Association of Native FireFighters. We do have recourse to the management reserve within government for these. The amount of money in any given year certainly fluctuates, and this was a particularly difficult year in terms of emergency management, given the size of the floods and the nature of the fires.
We continue to put agreements in place so there are no delays and we can move very swiftly in supporting first nations and addressing emergencies.
[Translation]
As you know, there's been a lot of talk about this issue this week. It's been more than four weeks since Attawapiskat declared a state of emergency. People are in need. They don't have access to water. They are living in tents. They are in danger because of the cold, but no federal official has visited the community to assess their needs.
Since this isn't the only reserve that faces this problem, as there are many other aboriginal communities across Canada that do as well, could you tell me whether amounts have been set aside for this, including additional amounts in the $95.4 million? What are the plans to help out these communities?
[English]
I'll mention in starting that the federal officials are now, and they have been, at Attawapiskat First Nation, the one that's been particularly in the news over the last number of weeks. The department is deeply concerned about the situation. Since 2006, as a department we have invested approximately $80 million on the Attawapiskat First Nation for housing infrastructure, education, and administration.
Department officials have been and are now in ongoing contact with the community. We're working with them to implement their emergency plan. Our priority in the immediate term is working with the community and also with provincial officials to ensure the affected residents of Attawapiskat have access to warm, dry, and safe shelter. We're going to continue to work with them, ensuring health, safety, and well-being of the residents.
When we determine our capital budget through our capital planning process with our first nations, health and safety clearly comes to the fore, and there are opportunities to make sure we can reallocate to high-priority items through the year.
Thank you. Right now, you're at six minutes, actually. You're well over time.
Just on a point of clarification, though, Ms. MacGowan, I didn't hear the dollar figure you said in answer to Ève's question. How many dollars did you say we have spent up to this date?
[Translation]
[English]
Thank you very much, Mr. Chair, and I'd like to thank Ms. MacGowan and the other officials for joining us today.
I note that you capture the costs of funding for legislative and regulatory changes in the supplementary estimates. Most recently, I had the opportunity to join the Minister of Aboriginal Affairs and Northern Development Canada in Saskatchewan, where he introduced a new piece of legislation, enhancing first nations accountability and transparency.
I guess my question would be, and in fact it's a question that I've been asked over the past few days, what will be the cost to Aboriginal and Northern Development Canada when this legislation is passed?
What we're anticipating with respect to the Financial Transparency Act is additional transparency from first nations to their communities. Currently, in the context of our transfer payments, first nations already report to our department in the context of their financial outcomes. We're not anticipating that there are going to be additional costs to us with respect to the financial reporting, and indeed these are the kinds of details that are shared with the department but are not shared today with communities.
Thank you.
In keeping with talking about legislation, I'm wondering if you could give us an update on the state of the implementation of Bill C-3.
Thank you very much. I'm happy to have an opportunity to update you on Bill C-3.
As you know, the bill came into force on January 31, 2011, and $20.2 million was given over a five-year period to fund the implementation and the registration. As of November 14, we had received close to 23,000 applications, and we have a dedicated team in Winnipeg that only focuses on Bill C-3. We expect to have the 23,000 fully processed by the end of this fiscal year, and we expect to receive between 44,000 and 45,000 applications in total over the next year to year and a half.
Thank you, Mr. Chair. I'm going to steal a little bit of her time.
I have two quick questions in these two minutes. Of the $546 million you're asking for, 25 items make up that number, whether it's in vote 1, vote 10, or vote 5. I'm looking at these things. I can't believe that all these things were resolved or changed between supplementary estimates (A) and supplementary estimates (B)—25 items in that timeframe. Why aren't some of these things already in the main estimates, or why weren't they in the supplementary estimates (A)? I cannot understand how we have so many items in that short period of time. I know you have an answer for me.
The President of the Treasury Board tables three supplementary estimates, usually in the late spring, late fall, and early spring—
To cut to it, timing is the reason why supplementary estimates are utilized by the department to revise its spending levels. Input into the main estimates is really required in the fall. However, new funded initiatives that could support, for example, the federal budget emerge in the winter. The only manner in which the funds can actually be accessed for the upcoming fiscal year is through one of the supplementary estimates. It's really a case of timing.
Also, some of these items within our supplementary estimates relate to certain events or activities that are actually time-sensitive. Requests to re-profile resources from one fiscal year to another could be required to accommodate changes in the number of forecasted applications, for example.
I want to tell you why I asked the question. On my chart of who's asking for what over the last five years, I have everybody's main estimates, supplementary estimates, and what they actually spent out of public accounts. In the department you work for, 17%, 12%, 14%, 15% of your annual spending is through supplementary estimates. I was looking for ways to reduce how many supplementaries we have. You were really good. You have $18,000 in the supplementary (A) estimates. But this one is fairly significant, and there are a lot of items here for us to be looking at. I was a little concerned that we're piling on a bunch of pieces.
My next question is on the math, just so I understand. You say you have set aside approximately $2 billion for the settlement. That's what's in this thing. Somewhere it said about $2 billion was set aside for the residential school agreement. Is that not correct?
There are different components to the settlement agreement. If you take the individual assessment process, $1.2 billion has been spent to date. If you take the common experience payment, we have spent $1.6 billion to date.
I'm sorry, that was for Bill C-3.
If we get back to the Residential Schools Settlement Agreement, we're expecting to have a total on the IAP of about 30,000 claims. We've received 23,000 so far. On the CEP, we closed with 101,000 claims. We closed the process last September, but there is still one year of exceptional circumstances, so we'll be getting a few thousand more.
Because it's claims-driven, it depends on how much we will be receiving. The chief adjudicator mentioned that it could be $2.6 billion for the IAP, and that with the additional $1.9 billion for the CEP it could get up over $4 billion. It's claims-driven.
Thank you, Mr. Chair, and welcome to the witnesses.
I have a question about residential schools in general, and the Truth and Reconciliation Commission in particular. My understanding is that a key part of the commission's mandate is to establish a permanent research centre on residential schools. I understand the current commissioner says there isn't enough money to do that. He or she has funding constraints. I understand the departmental performance report says the commission lacks funding and is subject to bureaucratic constraints.
I wonder if someone can comment on this situation.
I can't speak for what the commissioner of the TRC feels is sufficient funding, but the government provided the TRC with $60 million. It also provided $8 million for the TRC to set itself up as a department, $2 million of which was used by the former residential department, so there would be about $66 million. Further questions on their funding would go, I would expect, directly to the TRC commissioner.
I can speak to the fact that the settlement agreement asks the TRC to bring together all the records that deal with 100 years of residential schools. I'm pleased to say that Aboriginal Affairs has transferred 732,000 of its documents and will have transferred close to a million in another month's time.
We're also responsible for coordinating the transfer of relevant documents from 19 other federal departments. We have MOUs in the process of being signed with Library and Archives for the archival material.
So we're diligently supporting the TRC in its efforts to bring archival material together, because they have a very important mandate.
Our responsibility is to transfer all the material, and it's up to the commissioner to decide if there's a research centre or a holding for all this documentation, or what approach he will wish to take.
One of my colleagues raised the issue of Attawapiskat—I might be pronouncing it wrong—the town that's in the news.
You were saying $80 million has been spent since 2006, and I gather that's something in the order of $50,000 for every man, woman, and child. I don't know if you can say much about this, but if you look at the TV images and then you consider the number of $50,000 spent for every man, woman, and child, it's difficult to reconcile the two.
Can anybody comment at all on that?
The only comment I would make is that we have departmental officials actually on the ground now. They're working with the community to try to sort things out. I don't have a comment beyond that, though, at this point.
My last question is very broad. Some time ago, maybe 14 years ago, I wrote a paper called “The Cost of Doing Nothing”, about aboriginal affairs. It was an extremely dismal set of statistics, whether you looked at health care, incarceration rates, education, etc.
Now, you spend large sums of money every year. Can you comment on the cost-effectiveness of your department in terms of whether it's in housing or education or health? Has there been significant progress in the living conditions of aboriginal people over, say, the past decade—that would make it non-political—or are things standing still or getting worse?
I didn't bring any of the socio-economic statistics with me today.
I don't know if my colleagues would care to comment.
I'll answer, Mr. Chair, maybe from a self-government perspective, because a number of our first nations or aboriginal groups are now self-governing, and we're starting to see a body of evidence that can make a link between better socio-economic outcomes and becoming self-governing, and getting the benefit of being able to be more self-sufficient in their communities.
About 40% of our land mass is now covered by treaties or self-government agreements. A large number of first nations...it's still a minority of the first nations population, but we're making progress, and we're negotiating with a large number of other first nations that have those aspirations. I think this certainly points to some better outcomes that can be achieved through our departmental programs.
Again, as a point of clarification statistically, when you said $80 million since 2006, that equals about $50,000 per person. Does that include education, health care, housing, from all five of the departments that feed reserves?
So $50,000 over six years for everything. That would be about $9,000 per person. We spent $10,000 per child simply to go to high school, so $9,000 per person over six years doesn't seem like a lot of money.
Is my math right? Mike, you're good with math.
It's about $8,000 per person per year for everything: health, education, housing, infrastructure, sewer, water, electricity.
That makes sense. Now I see why there are shacks in Attawapiskat. I can't editorialize because I'm in the chair.
In response to whether it includes everything—housing, infrastructure, education, and administration—yes.
I think that's important for the committee. If the sum total aggregate amount of spending for that community was $80 million for that six years, $50,000 per person, I understand that to mean that's everything from all five of the government departments that feed health, education, infrastructure, INAC—
I think we're getting a little bit away from it, and I think it's a great topic for the aboriginal affairs committee.
Thank you.
Thank you, Mr. Chair.
Thank you, distinguished guests. It's good to see some of you.
I participated earlier this fall in the aboriginal and northern affairs committee, and we talked about the resolution of native claim lands. I'm glad to see a large number here.
In your presentation you talked about $2.5 billion that's been set aside for the resolution of specific claims, and that's a big number. I can understand the need to resort to supplemental estimates, because these kinds of negotiations are inherently unpredictable. There are lots of twists and turns.
Could you describe what's involved in the implementation of the resolution of these claims and some of the creative approaches the department is using that might differ from what was done 10 to 20 years ago, and why those things are perhaps leading to additional costs? Hopefully that will lay a framework for long-term benefits for first nations, in terms of resolution of the claims, better governance, and then ultimately some form of self-government.
Thank you, Mr. Chair.
Certainly this is an area in which a lot of progress has been made over the last two years. In 2007 the government announced a new initiative called “Justice at Last”, which responded directly to the frustrations expressed by communities about the slow pace of these outstanding claims. Some of them went back decades without any resolution or solution. So we put in place a fairly aggressive process by which within three years of receiving a claim we would have completed the assessment and made a decision as to whether we accepted the claim—whether or not there was a legal obligation—or we refused the claim. Then after that would be another three-year timeframe within which the claim would be negotiated and an offer would be made and hopefully resolved.
After three years, the first nation has the option of taking the claim directly to the specific claims tribunal, which is now up and running and hearing cases. It has five cases now.
In terms of assessments, we have completely cleared the backlog that existed back in 2007-08. Now we're in the process of negotiating many of those claims we have accepted to negotiate. There are over 300 claims currently under negotiation. Some of them are fairly small. Some of them are fairly big. We've made some changes. For example, for the small claims, in order to avoid a lot of the legal costs, the negotiating costs, we have a fast-track process through which we can simply resolve the claim very quickly without the first nation incurring loans. That's one of the approaches.
The other approach we've taken is to do shared valuation studies, so that at the end of the day when a settlement number is put on the table, the first nation is not surprised, because they were part of the valuation. So if they lost 10,000 acres of land 100 years ago, we know how to evaluate what that land is worth today; they will have all that information, and that hopefully will lead to a quicker and easier solution and settlement.
The progress we've made so far does demonstrate that we are making progress, having settled about $1.2 billion worth—over 70 claims—since the introduction of “Justice at Last”.
What I'm hearing is there's an accelerated pace of claims. Maybe it's speculation, but is there a likelihood that we can actually come under that budget of $2.5 billion that was set aside, that there might be a supplemental estimate at some point that says we don't need as much money as we thought we did?
The $2.5 billion was an estimate made some years ago based on what we knew was in the system. We are now closing in on that amount, when we look at the claims that are under negotiation. Certainly, there's a possibility that we will come under that, but I think it's a very low possibility. My prediction is we will be coming back to the government and actually seeking to replenish that reserve.
The contingent liabilities that are booked against the department's books are much larger than that amount. Of course, those include claims that have not yet been accepted, so some of them will not be accepted for negotiation. I suspect we will be coming back for more and to try to finally get to the bottom of resolving all these claims.
Oh, good.
Well, quickly then, maybe you could just talk about after a settlement is made, after a claim has been negotiated. Can you just talk really briefly about the capability-building and things your department might be doing there, in terms of partnering first nations with provincial and municipal bodies, where you can build education and other kinds of infrastructure?
Again, it's a little bit complicated because there's a separation between resolving a specific claim and capacity-building or working with that first nation towards self-government or, in some cases where there's not a treaty, negotiating a treaty. In some cases, we're actually negotiating both issues with the first nation. For example, the Yale First Nation is one of the recent settlements of a specific claim. We also have a treaty that we hope will soon be implemented there.
So they are separate processes; however, from a reconciliation perspective, it's an important step to be able to put the mistakes of the past behind us, to be able to start a fresh, new relationship.
Also, the funding that's provided...sometimes those are big settlements. They're provided in trust. Again, the first nation decides how it wants to manage. It can go to buying more land, where there are land shortages. It can go into investments in economic development. It can go into education programs. There's a whole range of things that the first nation can then do with that money to help build the capacity, and hopefully a brighter future.
Thank you very much.
Thank you, Mr. Borbey.
That's all the time we have, Mr. Trottier. Thank you.
Denis Blanchette, you have five minutes, and then we'll have a brief round from the Conservatives.
Then I remind committee members that we have to get on to the next round of witnesses, with HRSDC.
Denis, you have five minutes.
[Translation]
Thank you, Mr. Chair.
I would also like to thank the witnesses.
My first question is about the transfers from the Canadian Northern Economic Development Agency to the Health Canada portfolio because of government reorganization. There was an initial transfer of $12 million and then another transfer of $30 million.
What is that exactly? Will there be more transfers like this in the next Supplementary Estimates?
[English]
The transfers that are listed in the supplementary estimates are, for the most part, transfers that are coming into aboriginal affairs. With respect to the one from health, the $1.6 million, the department has entered into a service agreement, on behalf of Health Canada—
[Translation]
Ms. MacGowan, we're talking about using government reorganization to justify the transfers. I'd like you to explain that specific aspect and not necessarily all the little sums of money here and there.
[English]
In the case of CanNor, for example, the minister had responsibility for CanNor up until a date in May, at which point responsibility was transferred to Health Canada. There was an accounting done, and that's reflected in the estimates.
With respect to transfers in general, departments generally transfer money back and forth where one of the departments is in a position to enter into an agreement, in our case with a community where there is some opportunity perhaps to have a single agreement as opposed to having multiple agreements with a community.
I'm not sure I'm directly answering your question, but I'm struggling a little bit with what you're getting at.
[Translation]
Anyway, I'll change the subject.
Under the heading "Professional and Special Services", with respect to Aboriginal Affairs and Northern Development Canada, on page 200 of the Supplementary Estimates (B), there is an amount a little over $70 million. What portion of that amount went to subcontractors? And why?
[English]
I don't have that level of detail here, but certainly, if the committee is interested, I can bring back detail.
[Translation]
Thank you.
Under another heading titled "Funding related to the assessment, management and remediation of federal contaminated sites", you are asking for $26 million, which is roughly a 30% increase. I imagine that this concerns the decontamination of mines that you mentioned in your presentation. Is that it?
Since these things are foreseeable, how is it that there is suddenly a 30% increase in the budget? What happened?
[English]
I'll probably ask my colleague Janet King to elaborate, but this was money that was announced in the federal budget. It's a horizontal initiative, and this was the mechanism to bring the money into the department.
Janet, would you like to expand on that?
Yes, it was about the timing. It wasn't a brand-new ask. It was about when the money was made available and brought into the departmental budget.
[Translation]
Is it customary for you to pay for the decontamination of mines? After all, it's private companies that are doing the polluting, but it's public money that has to be used for the decontamination. Is that usual?
[English]
Since 2002, regulations have been in place. The private sector posts bonds to manage the mitigation of sites. Prior to 2002, such requirements did not exist. Speaking for the north in particular, two of the major mining projects—the Faro and the Giant—were active when the government did not have requirements for the companies to mitigate all impacts as they closed down. When they closed these companies as active mines, they reverted to the control of the Government of Canada. The Government of Canada thereby became responsible for their mitigation.
Denis, I'm afraid that's the end of your time.
Thank you, Ms. King.
Mike Wallace, did you have a few minutes you'd like to...?
Yes, thank you.
I'd like to come back to the Indian residential school thing, just so I understand the budgeting of it. I want to be clear that I'm in favour of resolving these issues. I just want to make sure I understand the money when I'm looking at these books.
Vote 45 has residential schools in supplementary estimates (B)...well, it's not in supps (B); it's from already approved authorities to date. The figure is $33.5 million, based on what's printed in your book.
The item we're talking about today was $179 million, which is $136 million of new money, with $43 million reprofiled. In my understanding, that means we had a budget last year, we didn't spend it, so we're reprofiling it into this year's estimates.
Am I right? Are we talking about the same line item, the same area, or am I mixing two things up?
Thank you for the opportunity to clear this up. The $179 million that we are seeking this year is to add funding to the settlement allotment, to make additional payments for the independent assessment process. With the adjudication secretariat, we have been successful in increasing our productivity, and we expect this year to be able to do 4,000 hearings. So we need more funds for the—
The $179 million we're asking for is to make additional payments under the individual assessment process.
Where do I find that in the mains? You're asking for additional money. What was the number in the mains that you asked for to begin with?
We have received $136 million for 2011-12, from which we've reprofiled $43.4 million. I don't have the mains; I can get them. But these are the additional funds we are seeking for the IAP—
So you're asking for an additional $179 million, minus the $43 million you didn't spend last year. That's why it's being reprofiled. Is that correct?
I wouldn't say we underestimated. It is application-driven. We receive about 430 applications, but it varies. So our best guesstimates last year would be that we would be settling about $3.6 million, which we did, with 3,500 hearings, which we did. This year we're looking at 4,000 hearings, and we're going towards it.
So based on those numbers, assuming that's the average you're getting, I'm assuming the hearings go on, they're probably more difficult—
And the adjudication secretariat thinks they'll have 2,000 to 2,500 hearings to do in the third year, so 2012-13, 2013-14, and then 2014-15.
Based on what we're doing, will you be able to better estimate from the mains what we're going to be doing?
Thank you, Mike. And thank you to all of our witnesses from the Department of Indian Affairs and Northern Development. We appreciate the information you've given us today regarding supplementary estimates (B), and we thank you for your attendance.
We'll excuse you now.
I think we will suspend the committee for a minute while we exchange panels.
The committee is suspended.
I will call the meeting to order.
Welcome to our next panel of witnesses, representatives from the Department of Human Resources and Skills Development, who will help us examine the supplementary estimates (B) for that massive department. Leading the delegation, I understand, is Mr. Alfred Tsang, the chief financial officer.
Mr. Tsang, I think we're a little tight for time. We're going to ask you to do a five-minute or ten-minute presentation and we'll have one round, at least, of questions. We hope to conclude about 20 minutes after the hour, if that suits everyone here.
Mr. Tsang, you have the floor.
Thank you, Mr. Chair and committee members.
[Translation]
Mr. Chair, committee members, I am pleased to appear before you this afternoon as the Chief Financial Officer for Human Resources and Skills Development Canada.
[English]
For simplicity's sake, I will use the acronym HRSDC throughout this presentation.
I would like to introduce my colleagues who are with me today: Kathryn McDade, assistant deputy minister, learning branch; Paul Thompson, assistant deputy minister, processing and payment services branch; and my colleague, Nancy Milroy-Swainson, director general, office of disability issues, income security and social development branch.
Allow me to offer the committee an overview of the HRSDC portion of the supplementary estimates (B), tabled on November 3, 2011. Through these estimates we are providing Parliament with an update to one statutory program, mainly an increase of $43.8 million in forecasted expenditures for the Canada disability savings program.
[Translation]
Introduced in Budget 2007, the Registered Disability Savings Plan is a long-term savings and asset building plan for people with disabilities.
Our revised forecast is based on two factors. First, provincial and territorial exemption announcements were made sooner than expected. To date, all provinces and territories have announced a full or partial exemption of Registered Disability Savings Plan income and assets. Second, financial institutions who offer Registered Disability Savings Plans have increased awareness, and individuals have greater access to the program given the financial institutions offering it.
Committee members can see this item on page 77 of the Supplementary Estimates (B). Because the Canada Disability Savings Program is a statutory program, this update is provided for your information only as Parliament has already approved the purpose of these expenditures and the terms and conditions under which they may be made.
[English]
In addition to this statutory item, HRSDC is asking for an additional $166 million in spending authorities, of which $149.5 million is related to a request for the writeoff of debts owed to the crown for unrecoverable Canada student loans.
Mr. Chair, this student loans writeoff item is the same item contained in our supplementary estimates (C) of last fiscal year. Given that last year's supplementary estimates (C) did not receive royal assent, we have reintroduced this item in the supplementary estimates of this fiscal year.
[Translation]
Allow me to provide a little context. A large percentage of students respect and repay their loans. Some borrowers have difficulties with repayment, and we have measures to support them through the repayment process. Nevertheless, some loans go into default. We have a vigorous recovery process, including working with our partners at Canada Revenue Agency.
[English]
The Canada Student Financial Assistance Act establishes a limitation period of six years between the time the borrowers last acknowledged their Canada student loan and any legal activity the crown can undertake to recover that debt. Once this period has expired, the crown no longer has the authority to take action to collect on the debt. Ninety-nine percent of our writeoff request has been deemed unrecoverable for this reason.
Other requests are itemized on page 80 of these estimates.
Committee members will note that we have several items listed under vote 5, grants and contributions. Of these items, all but $9 million represent carry forward of unspent funds from the previous fiscal year. One of the non-carry-forward items is the new horizons for seniors program to support projects that ensure seniors contribute to and benefit from activities in their communities.
As for our requests under vote 1, operating expenditures, our largest item is for $9.5 million, related to the government's advertising program. This request is to fund campaigns to promote skilled trades and raise awareness about elder abuse and financial elder abuse. Another item is the $2.6 million for the implementation of the enhanced guaranteed income supplement for those low-income seniors who rely almost exclusively on their old age security and the guaranteed income supplement.
[Translation]
I hope this overview has given you a more precise idea of the content of the Supplementary Estimates (B) for HRSDC.
[English]
My colleagues and I will be happy to answer your questions.
Thank you, Mr. Tsang, for that presentation. We will jump right to questions.
On behalf of the New Democratic Party, we have Ève Péclet.
[Translation]
Thank you, Mr. Chair.
Thank you to the witnesses for being here today.
We know that most of the department's budget cannot be cut because it covers payments for employment insurance benefits and for student benefits, for example. In accordance with the government's strategic reviews, $60 million was cut from the department. I would like to know where these cuts were made, given that most of the budget cannot be cut.
When the Hon. Diane Finley appeared before the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities, she spoke about a number of programs that the government is introducing to assist in training, and so on.
What are the impacts of budget cuts on these programs? Where will we find the funds needed to run them, given the government's strategic reviews?
[English]
As contained in the main estimates, these funds available can be directly attributed to strategic review. The strategic review is referenced on page 223 of the June 6, 2011, budget document.
There are three categories of savings. The bulk of the available funds referred to in the question for this year—well over 80%—are from the category of increased efficiency and effectiveness. An example of this is the streamlining of internal services such as finance, human resources, and information technology.
Another example of this is the merging of the apprenticeship incentive grant and the apprenticeship completion grant. Committee members may recall this item in the supplementary estimates (A) earlier this fiscal year.
A very small portion of the remainder comes from the other two categories: a focus on core roles, and meeting the priorities of Canadians. An example of this is the sector council.
I hope that answers the member's question on our strategic review.
[Translation]
My second question is about Service Canada. We are concerned about the figures provided with respect to the number of people who manage to obtain services by telephone. It seems that only 32% of the calls are redirected. About 50% of people cannot obtain services by telephone and hang up or the call is ended.
Given that a cut of 600 jobs and the closure of several sites were announced on your department's website—I'd like to mention that one of the few sites that will remain open in Quebec is in the riding of the Hon. Christian Paradis, Minister of Industry—I'd like to know how many jobs were lost and how much that will save. I'd also like to know if that money will be used elsewhere. For example, will it be carried forward to supplementary credits? And what impact will these cuts have on services to Canadians?
[English]
Before I turn it over to my colleague, Mr. Paul Thompson, I want to inform the committee that in the supplementary estimates (B) there is no reference to the funding being questioned.
I'd be happy to speak to the question of service delivery. The announcement you're referring to on about 600 positions does not impact call centres. That is a modernization agenda that will unfold over the next three years, this being the first year. The vast majority of that will be achieved over the course of three years.
On the call centres, we're experiencing a very high volume of calls right now, and that fluctuates over the year. I just want to make the distinction between 50% of callers versus 60% of calls. It is indeed the case that about 50% of the calls we receive are not being answered, but on subsequent attempts they are likely responded to. Far in excess of 50% of the callers are getting through to speak to agents.
Thank you.
Your time is up, Ève. It goes very quickly, I know.
Scott Armstrong for the Conservatives.
Thank you, and thank you for being here today and looking at the estimates.
At first I noticed a $2.5 million increase to the GIS supplement. Could you elaborate on whether or not that means the money has already been delivered to the seniors as part of our Budget 2011? That brings it up to the largest amounts it's been in 25 years. Could you elaborate on some of that?
Mr. Chair, if you will allow a bit of a two-part answer, I'm going to address the operating part and I'm going to ask my colleague, Paul Thompson, to talk about the contribution part.
The $2.6 million under vote 1 for GIS top-up is for us to implement the top-up, and that's primarily changing our systems, etc.
And on the program side....
This was a measure that we implemented in short order following the budget. We actually got it implemented in time for the July payment for seniors. What it does over the course of the year is increase the GIS payment by approximately $600 for a single recipient and $840 for a couple, and it goes to about 40% of the guaranteed income supplement recipients who receive this top-up. That, as I said, has already been fully implemented. The amounts in the supplementary estimates are the funds that help us with that implementation—answering inquiries, changing the systems to ensure that it's delivered accurately and on time, and supporting communications and websites and various other tools we use to administer the program.
That's wonderful.
I've also noticed a $5 million increase to the new horizons for seniors program—we're still on seniors here. It's very popular. I know in my riding we have a significant number of seniors.
Was that increase the one that was included in Budget 2011? What will this increased funding be put towards?
The $5 million for the new horizons for seniors program is indeed provided as announced by Budget 2011, and it will further the program's objectives by funding a greater number of projects, bringing the program's total annual budget to $45 million. Since 2004, the new horizons for seniors program has funded over 8,500 projects in well over 1,000 communities across Canada.
Can you give me examples of some specific programs that might have been funded? What types of programs can seniors apply for? Would you know of any?
The new horizons for seniors program has a number of priorities, but the bulk of that money was used to strengthen the program's capacity to deal with abuse of seniors—abuse prevention and so on—so that's what it was devoted to for the most part.
You've also increased the advertising campaign to promote the abuse against seniors program. You must have done some sort of research to see that the message wasn't getting through so we needed to promote that more strongly?
In the item for the $9.5 million for advertising, that is indeed one of the campaigns it is intended for.
My last question has to do with the student loan program. Could you clarify the amount of student loans that are being written off? I think this includes up to three years of bad debts. Am I on the right track there?
Yes, you are on the right track. The estimates indicate that we are requesting a writeoff of about $149 million. Those writeoffs did occur over a three-year period, so 2008-09, 2009-10, and 2010-11. The last time Parliament was asked to agree to a writeoff of direct student loans—loans that are provided directly by the Government of Canada—was in 2007-08, so the year just preceding this three-year period.
You mentioned some options students have to repay their loans. You say you're very flexible. Could you outline some of those opportunities and options?
There is a whole range of options, beginning at the time a student first consolidates their loan. If the agreed terms are not workable for the student—they get into, say, financial difficulty—they can for a short period of time make interest-only payments, or they could renegotiate the terms of their loan. Very few students avail themselves of those opportunities.
The primary measure for students who are having repayment difficulties is the repayment assistance plan. That program was introduced in Budget 2008 and was effective in the fall of 2009 for the 2009-10 school year. Under the repayment assistance plan, a student can apply to have an affordable payment that they have the capacity to repay based on their family income and family size. In the 2009-10 year, the first year that was implemented, about 160,000 students took advantage of the repayment assistance plan.
Thank you, Scott. Your time is up.
Thank you, Ms. McDade.
We'll go to Denis Blanchette, for five minutes.
[Translation]
Thank you, Mr. Chair.
I'd like to thank the witnesses.
Last week, we had representatives from PWGSC. There was an amount of $16.5 million for a new authentication system called the Access Key service. When I started talking a little more about the content, I was told to speak to the Service Canada representatives. I think the time is now.
Where are you at in implementing the Access Key service and what are the main steps in the future? What is the estimated cost of implementing this new system?
[English]
I'm afraid I don't have all the details on the work we're doing on Access Key, but it's an issue we are certainly actively working on within the organization. We're looking to align the different systems with government-wide authentication processes. There are discussions across the government, with different departments, to arrive at the best solution to meet the needs of various departments, including Service Canada.
I'm afraid I don't have much more I can elaborate on at the present time.
[Translation]
Can you give me a timeline and tell me what you will do with the $16.5 million? What steps do you see for going from epass Canada to the Access Key service? Will you be able to give me an answer later on in writing?
[English]
That's something we would have to follow up on. I'd be happy to follow up. I can get the answer from colleagues in Service Canada and provide that to you.
[Translation]
Perfect. Thank you very much.
Mr. Chair, with your permission, I will give the rest of my time to Ms. Ève Péclet.
[English]
[Translation]
I would like to speak about credits for the student loans program. It's a fairly astronomical amount because we're talking about $149.5 million. How is it that the forecasts were so wrong? I know the minister said when she appeared before the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities that this was provided for in last year's Supplementary Estimates (C). How is it that we aren't seeing it in the Main Estimates? Why carry them forward now? How is it that there is such poor foresight?
Since 13% of students cannot repay their debts, don't you think the program is missing its target? Would it be possible to review the program instead of simply requesting a repayment of $149.5 million?
[English]
Without getting into all the complexities of the accounting, the government does in fact make a prediction about the level of bad debt we anticipate over the course of a year. That amount appears in the estimates. However, because Canada student loans are crown assets, there has to be an accounting when an asset is written off. The minister doesn't predict that. She doesn't do a forecast. She actually comes to Parliament with an exact accounting of the specific loans, the specific crown assets, she wants to write off.
As set out in these supplementary estimates (B), there are about 62,000 loans, in the amount of $149 million, she's asking be written off. She's bringing those forward now, as opposed to having done that earlier, because of the process the government has to undertake to write off the loans.
The minister makes a presentation to cabinet to seek approval for the writeoff of direct loans. It was just in recent months that she did that with respect to the three loans years: 2008-09, 2009-10, and 2010-11. It is only at this time that she can provide Parliament with an exact accounting of the loans she wishes to write off.
It's not that she didn't forecast it well or couldn't have foreseen it. This is a precise accounting of the writeoff.
Thank you very much, Mr. Chair.
Thank you to our witnesses from HRSDC for being here this afternoon.
I want to start by following up on some of my colleague's questions about the GIS top-up. I presume that the request for the $2.6 million is in the supplementary estimates (B) because of the reality of the timing—your cut-off dates for the main estimates and the supplementary estimates (A) and the timing of the election. Is that correct?
What's the deadline for both your main estimates and then your supplementary (A)s, for your department?
For our department we would prepare our main estimates in the month of October, obviously of the previous year, so around five to six months before the fiscal year begins.
It's based on an estimate that we made some time ago. Again, the timing issue is such that now we have included that item in the supplementary estimates (B).
Very good.
This was a budget that was passed in June. The implementation of this particular initiative was in July. In terms of government, that's pretty impressive, that's pretty quick.
What did your department do to make that happen so quickly and effectively?
Thank you for that question.
This was indeed a huge challenge. Normally, to make a change of this magnitude and complexity affecting this many people would take quite a number of months to do, to reprogram the systems. We came up with some innovative ways. I don't want to get into all the details of the technology, but we brought together our technology specialists and our program designers. We came up with a strategy to implement this and test it in a rigorous fashion so that we were able to implement it without taking any undue risks.
A big part of the strategy in implementing this is to make sure you do it accurately so that you're not mispaying people. We think we got the right balance between an expeditious implementation and doing it without putting the program at risk.
Great.
Perhaps this is a segue to my next question. As members of Parliament we often hear from constituents in our riding, often to help with issues or concerns relating to the federal government. Last week I received a compliment from a constituent about the service they received from the Service Canada office on Weber Street in Waterloo. A constituent went in to apply for a social insurance number, a card for his 16-year-old daughter, and he was very impressed with the service he received. It was fast, friendly, quick. I wanted to pass that along to you, first.
Second, this is customer service, and improving customer service is a process of continuous improvement. How is HRSDC working to enhance customer service at Service Canada offices across the country?
Thank you for that question.
We have made service excellence the cornerstone of the strategy for Service Canada for the last several years. It's been a bit of a transformation for the organization to go from being specialists in a given program to being more generalists in the delivery of service to Canadians. The model is that a citizen should be able to come into one of our Service Canada centres and be served in the best possible way on a broad range of initiatives, not simply be told to go to a different door or to phone a different office. It's to provide a whole-of-government service, service that cuts across, definitely, the range of HRSDC programs in particular—our major statutory programs—as well as a range of other programs. This has been underpinned by a very extensive training regime for our staff, and we have other measures in place to monitor client satisfaction and the extent of the progress we're making on this service excellence journey as well.
Very good. Thank you.
If I might, I'll just ask a point of clarification again.
Do you have to make application for the guaranteed income supplement system, or do you automatically get it based on your income tax return being at a low threshold?
There is a requirement for initial application for the guaranteed income supplement, but for the last number of years, I believe the last two or three years, we've had an automatic renewal. So once you've entered the GIS system, there is a process through which, based on CRA tax data, we automatically renew the GIS. It's just that initial application that is required to get you into the GIS program.
Is there any kind of actuarial projection that anticipates that there are people out there who qualify or are eligible for the supplement but who have not yet applied for it? And is there an effort to reach out to them to invite them to apply?
We have a very active program. In fact, in advance of people's 65th birthday we have a major outreach campaign to send out presumptive applications to people who we know might be eligible. So to the extent that we have data that there are individuals approaching their 65th birthday, we do mail out a package and encourage them to apply.
As well, there are various other outreach activities through stakeholder organizations and other groups to build awareness of the importance of applying and getting the benefits to which you're entitled.
Thank you.
And thank you to our witnesses.
I would like to return to the subject of the $60 million in savings in the strategic review.
If you look at the budget, you'll see that the categories are very broad and virtually the same thing for every department, things like increasing efficiency and effectiveness, focusing on core role, etc., which basically doesn't tell you anything.
My question is this. Whether you could do it now or whether you perhaps send written information, can you give us a breakdown of the $60 million in terms of which programs or activities were cut and what the implications were in terms of full-time equivalent jobs?
Mr. Chair, earlier in the session I gave some examples. Probably the largest of the $60 million is the merging of the AIG—that's the apprenticeship incentive grant and the apprenticeship completion grant—which is $30 million right there.
It is very difficult to read the table, so we would be happy to provide the committee with a table.
Thank you. That would be very helpful.
The second question is on the same subject. The budget says that your department is responsible for $80.5 million, not $60 million. Does that mean there is $20 million more coming?
The answer to that question, Mr. Chairman, is that the $60 million shows up in voted money. The other $20 million is chargeable to things like, for example, our CPP account. Those are other savings, which count for the purpose of the budget document on page 223, but they do not come under the supplementary estimates because they are not appropriated.
Thank you. That's very clear.
This is my last question on this general subject. I'm not sure whether this is related to the strategic review or not. A couple of months ago I was in Montague in Prince Edward Island. There is a Service Canada centre there, which I think processes EI claims. It was in the process of moving from 60 permanent staff to zero over a number of years.
My question is this. Is that a part of the strategic review process, and whether it is or not, what is the rationale for closing that place?
Part of our strategic review, as I noted earlier, our plan, is to achieve savings equivalent to 600 full-time equivalent jobs over the course of three years. Those are through automation and efficiencies. Those aren't simply cuts. There's actually a strategy with various releases of automation to achieve those savings.
As part of this agenda, we're at the same time consolidating our processing capacity. Rather than having processing staff spread across a multitude of small offices across the country, there's a strong business rationale to consolidate into larger, more efficient centres. That is why there have been a number of smaller sites that are slated to wind down over the course of the next two or three years.
You said earlier that service to the customer is your top priority. In Montague, I learned it was absolutely the opposite, because rather than getting service from individual people in their own community, who are now getting laid off, customers were required to phone 1-800 numbers, and in a large number of cases they either had to wait for many hours or not get contact at all, as compared with a local person living in their own community who understood the conditions.
So those people—and I know it's quite common across the country—have received a very sharp reduction in the quality of the service, rather than an increase.
It's important to distinguish between the front-counter Service Canada Centre presence and the back-office processing capacity. When you were referring to the job reductions over the next two or three years in Montague, that is back-office claims processing, which works on a national inventory of claims, so they're not working on claims from people in Montague. That's a distributed processing capacity.
No, but the member of Parliament was on a regular phone-in basis with the people in this office. The people are now being transferred out of it so that local contact is lost. I've heard from many individuals that the service is much diminished from what it was a year or so ago.
I'd also like to ask a question about advertising. There is $9.5 million in advertising. Advertising for what, and how is that broken down?
I believe I referred to that in my opening remarks, Mr. Chair. They are for three campaigns: skilled trades, elder abuse, and financial elder abuse.
I wonder if we could get that information to you, John, and we can move on to the next round of questioners. It will be our last...unless you have the information available now. Do you?
It's $4.5 million for senior financial abuse, $2.5 million for the apprenticeship grant, and $2.5 million for access to financial benefits.
Very good. Thank you for that specific information.
Now for our last round of questioning, Ron Cannan.
Thank you, Mr. Chair.
I'm going to share my time with Mr. Gourde. I have a couple of quick questions.
I have a daughter in post-secondary, and I know the cost of schooling is quite a challenge. She works hard and has won some scholarships, and I have a registered education savings plan, so we try to help out.
You said the majority of students pay. What percentage of this $149 million represents the outstanding number of student loans?
As Mr. Tsang said in his opening remarks, the vast majority of student loans are repaid to the government over the lifetime of the loan. The exact number is about 87.2%.
Taking that another way, almost 13% of loans are not repaid. Of that amount, about 11% is written off, so a writeoff of $149 million is captured in the request to Parliament under these supplementary estimates (B).
The government forgives very small amounts—the difference between 11% and a bit, and 13%—because of the death or severe permanent disability of the borrower, or because, as I had answered in response to a previous question, the borrower is on the repayment assistance plan. While they're on that plan the government may be paying down or forgiving part of their principal. Those are the reasons for the 13% of loans that are not repaid to the government.
We rely on the chief actuary in the Office of the Superintendent of Financial Institutions to forecast for us whether there is an anticipated shift in that amount, either up or down. He is forecasting that for the foreseeable future the amount will stay roughly constant, so the proportion of loans we're writing off is not expected to change over time.
He did identify a small increase in default that he attributes to the recent recession, but he does expect that to be a blip and expects the number to return to its previous level. Because the number of loans that we disburse is going up on an annual basis, the quantum is growing, but the proportion of writeoffs is largely staying constant.
How many loans do we have outstanding? The portfolio of outstanding direct student loans shifts on a day-to-day basis. As money comes in, obviously the amount of outstanding loans goes down, and as we disburse funds the amount goes up. But the outstanding balance is between $13 billion and $14 billion.
I can't tell you the number of accounts that represents, I'm sorry, but it is—
It has been in effect since 2003. One of the primary reasons the number of loans written off is increasing is that of course students are just going beyond the six-year statute of limitations as they get out of school, start the repayment process, and then—
Before that six-year statute of limitations was in place, the Government of Canada was basically using whatever statute of limitations was in place in the student's province or territory of residence. Those statutes varied across the country. Some were as low as a two-year statute of limitations. The idea in 2003 was to establish a consistent statute across the country for Canada student loans, regardless of where the student resided. The six years was chosen as the reasonable upper limit of what was in place in the provinces at the time.
Is there anything else we can do, after talking to the Federation of Students or the university groups and college groups, to help them with the repayment strategy or a repayment plan?
It's early to evaluate. As I said, the repayment assistance plan has only been in place since the 2009-10 school year, so we haven't undertaken an evaluation yet. We intend to. We expect to find that it's made a significant difference in the ability of students with low incomes or with employment difficulties to repay their loans.
To change the channel for a minute, I have a question on apprenticeships. I think that's one of our big challenges. With our aging population, we need skilled labour. What's the uptake in the apprenticeship program? Is it meeting our planned uptake?
I'm afraid I don't have those statistics on hand, but certainly they're available. I'd be happy to provide them to the committee.
Thank you. That's very helpful.
That actually concludes this round of questioning. We're right on time for the rest of our business.
We'd like to thank Mr. Tsang and the delegation from HRSDC for helping us understand your supplementary estimates (B) for this budget year. Thank you very much for coming.
Just give us one minute to regroup. There doesn't seem to be any....
An hon. member: [Inaudible--Editor]
[Translation]
[English]
[Translation]
…which reads as follows:
That the Standing Committee on Government Operations and Estimates undertake a study to investigate the many overcharged projects for the management of federal buildings that were granted by the Department of Public Works and Government Services to SNC Lavalin without following the rules, and that the Committee report its findings to the House.
I am making this request for the following reasons.
This is a situation that should be of great concern to us as members. We are talking here about the management of several millions of dollars from Canadian taxpayers.
[English]
Before he started to speak, I asked that we move in camera. I actually asked to move. If we have not—
A point of order, Mr. Chair. If we did not suspend, I asked to go in camera. We should move in camera before any announcements are made by any other members of the committee.
Just a minute. It's a point of order. It's a legitimate point of order, and my ruling on it is that the clerk asked me if we were going to suspend the meeting. I said, “No, we're going to carry on, in the interest of time”. Mr. Mathieu then said, “May I have the floor to go ahead?” At that moment, you said, “Are we going to go in camera or not”, and I said no at that time.
No, you did not, Mr. Chair. I challenge you on that. I'm challenging the chair.
I asked to go in camera. There was an indication that we were going in camera. We were under the impression that we were under suspension, as we normally are between groups, which we did even today between groups, between sessions, on our agenda.
I am challenging you. I moved to go in camera. It's a debatable motion. If we were not suspended, we should have moved to that directly, before any announcements from the opposition.
Actually it isn't a debatable motion. A motion to go in camera is voted on immediately. You didn't specifically say “I move this”. In fact, you weren't even in your seat, Mike; you were standing and walking back to shake hands with that guy. In the interim I went ahead and....
You're challenging the chair. The quickest thing would be to just go ahead with your motion to go in camera now.
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