I will call this meeting to order.
Thank you all for being here, particularly in such inclement weather.
Thank you, Minister. This is your first time appearing before this committee. I'm sure it won't be the last. Welcome.
Colleagues, originally I thought we could ask the minister if he could dispense with his opening remarks and go straight to questions.
However, my understanding is, Minister, that you don't have any prepared remarks but you do have an opening statement. In that case, we'll go forward with the traditional 10-minute opening statement, followed by questions.
With that, Minister, I'm sure you know the drill at committees by now. If you would care to open the meeting with your opening statement, perhaps right after you introduce your officials at the head table with you, then you may proceed.
I'm very pleased to begin, since I have many good things to tell you, especially on issues of concern to you.
First, I would like to thank the committee for inviting me today to discuss supplementary estimates (B) 2019-20. As you said, this is the first time I have had an opportunity to appear before your committee. I am very honoured to be here.
I am lucky to be joined by very good officials, who are supported by equally good teams from the Treasury Board Secretariat. On my left is Glenn Purves, assistant secretary of the expenditure management sector. On my right is Karen Cahill, assistant secretary and chief financial officer. A bit further to my left is Marcia Santiago, executive director, expenditure strategies and estimates. As you may have suspected, the three of them will make it their duty to answer any questions you consider relevant to this highly important issue. I am talking about the rigorous and effective financial management of the Canadian government's expenditures and investments.
In all, Mr. Chair, these estimates we are about to speak on describe a total of $5.6 billion in planned budgetary spending. Of this amount, I would remind you that $1.8 billion is already authorized to what we call existing legislation. Thus, with these supplementary estimates, the government seeks authority for $3.8 billion in additional voted spending.
These new expenditure spending plans will ensure the government continues to deliver on its commitments to Canadians in a number of important areas. These include significant investments in advancing reconciliation with indigenous peoples; in supporting the dedicated men and women of the Canadian Armed Forces; and in working with our partners across Canada to address climate change.
In keeping with the commitment we made in budget 2019, total funding of $919 million, which was allocated to Crown-Indigenous Relations and Northern Affairs Canada, will be used to write off the loans disbursed to first nations and Inuit communities, as well as to the Métis nation, for negotiations of comprehensive land claims. Those loans were disbursed to ensure that Canada's indigenous peoples would have the resources they need to participate in land claim negotiations in a meaningful and equitable way.
In many cases, however, the negotiation of those modern treaties, which is so important in today's context, has taken much longer and been much more difficult than expected. In addition, those loans have become a heavy burden for too many communities. In some cases, those loans came up to tens of millions of dollars. For small communities, that was a considerable obstacle to economic and social development.
So those debts will be remitted, and the communities that have paid back loans in the past will be reimbursed.
A further $588.3 million will be allocated to Indigenous Services Canada. These funds are required to support ongoing efforts to meet the critical need to improve indigenous child and family services, which is absolutely essential, including expanding prevention and early intervention programs. As I am certain this committee will agree, the transformation of these services is absolutely crucial to reconciliation and self-determination, to righting past wrongs and moving in the right way. It is even more critical to a new generation of indigenous children, when we remember that fewer than 8% of Canadian children under 14 are indigenous, yet these indigenous children account for more than 52% of children in foster care in private homes.
An additional $232 million to Indigenous Services Canada will provide for the ongoing implementation of Jordan's principle. These funds will help ensure that indigenous children across Canada have access to the same specialized health, education and social service supports as any other child in this country.
Regarding expectations, Canadians have clearly indicated numerous times that they expect all levels of government to take strong action in the fight against climate change.
The expenditure plans set out in these estimates include a continued $109-million investment in Canada's climate action incentive fund to help small and medium-sized businesses, municipalities, universities, hospitals and schools implement their carbon and pollution reduction projects, as well as their energy efficiency enhancement projects.
As all committee members probably know, the climate action incentive fund is funded through the products and royalties of the federal carbon pollution pricing system. Moreover, as per the commitment made in budget 2019, the estimates include a $950-million contribution by the Federation of Canadian Municipalities, which is more than double the capitalization of its green municipal fund to foster local green innovation across the country. Since its creation in 2000, that fund has contributed $862 million in support of more than 1,300 sustainable development initiatives in municipalities across Canada, and I specify, while preserving every dollar of capital provided by the Canadian government.
Therefore, this new investment will help launch a certain number of new funding streams, from the affordable housing innovation fund—we know how critical of an issue housing in Canada is in terms of affordability, economic development and the fight against pollution and greenhouse gas emissions—to the community ecoefficiency acceleration fund.
Mr. Chair, Canadians also expect that Canada's armed forces will be there when they are needed to protect the safety and security of Canadians here at home and abroad and to contribute to global security as partners in joint missions abroad.
That is the aim of the Government of Canada's defence policy, “Strong, Secure, Engaged”. To ensure that our armed forces are equipped to meet these expectations and these needs, the estimates that we have in front of us include a planned allocation of almost $500 million to the Department of National Defence. These funds will be an investment in the equipment, infrastructure and information technology systems that are absolutely essential to the operation and maintenance of a modern armed service.
A further $128.5 million will support current overseas operations. To be more precise, that will include the ongoing land force deployment in Latvia as part of NATO's deterrence mission in central and eastern Europe, and in Africa where members of the Royal Canadian Air Force are currently providing tactical airlift support to UN peacekeeping operations from their base in Uganda.
In terms of highlights of these estimates, I would also mention one other substantial item: $138 million to the Office of Infrastructure of Canada. The largest part of this amount, $106 million, relates to the completion of the Champlain Bridge Corridor project in Montreal that many of us know is a vital transportation link for more than 60 million vehicles each year.
In closing, I can only provide the highlights of the estimates in the time I have. The estimates and the relevant documents you have access to give all parliamentarians—and all Canadians—the possibility to help the Canadian government act responsibly by allocating public funding to important issues that matter to all Canadians across the country.
In keeping with our government's commitment to increase transparency to a level that enables me to meet the expectations of both Canadians and parliamentarians, I would like to point out that a substantial amount of additional information is also available online. In fact, it is not only available online, but is also presented in an increasingly accessible format to Canadians. That way, parliamentarians and Canadians could understand the impacts of our investments in our families, our children, our seniors, our armed forces, our infrastructure, as well as in indigenous peoples.
I look forward to a thorough examination of these estimates by parliamentarians of whom you are distinguished representatives today and to any questions they may have or you may have as we work together to invest in meeting the priorities, needs and expectations of Canadians.
Thank you, Mr. Chair.
I will now be happy to take any questions the committee may have.
Minister, thanks very much for joining us today. Mr. Purves, Ms. Santiago and Ms. Cahill, welcome back.
I hope you have a good reign as president of Treasury Board. We look forward to you working with us to bring much better transparency and oversight to our spending process.
Speaking of transparency, I want to chat with you about vote 10. Traditionally, Treasury Board vote 10 has been about $3 million a year, up until the last two years where it jumped to well over a third of a billion per year—$368 million and I think $371 million. Of course, that's on top of the $7 billion vote 40 slush fund and the extra $5 billion in the table A2.11 slush fund from last year.
I want to read right from your web page. It says that vote 10 is “subject to the approval of the Treasury Board, to supplement other appropriations in support of the implementation of strategic”—and I want to emphasize that word “strategic”—“management initiatives in the public service of Canada.”
I want to grasp how we have this need go from $3 million, $3 million, $3 million, up to well over a third of a billion dollars. The example I'm going to use is in the estimates this year, we have $3.5 million for CRA under vote 10. Now CRA is on a two-year cycle. Last year they lapsed $180 million, so I'm trying to figure out, for a short-term project, why there's a need for $3.5 million out of vote 10 for something that's not strategic, for a department that is lapsing the money. They can't even spend the money that they have approved, and yet we have to fall back on money that's pushed in there under vote 10 .
Thank you very much, Mr. Drouin.
By the way, I would like to acknowledge your important work once again.
Here, the key words are “effectiveness” and “transparency”. As we know very well, there is a problem that goes back to the beginning of Confederation, I believe. It is a problem of alignment between the budget process and the estimates process. That leads to a disconnect between the information you have access to when it is time to consider estimates and the tabling of an annual budget, such as that of the .
That disconnect has been explored over the past few years, including through the pilot project you mentioned. We have learned important lessons from that pilot project. In parallel to those lessons learned, we have also implemented significant measures to increase both effectiveness and transparency.
By the way, I want to mention the directive on results that was submitted not even two years ago, in 2017, which increases transparency, so it makes is easier for you to understand those two work methods. We call it the exercise method for the Minister of Finance, and the accountability method for the estimates process.
In English, this is called “accrual and cash”.
It cleary creates difficulties in the work you wish to do as parliamentarians.
As you know, we have implemented a database, GC InfoBase. It is an extraordinary database that I invite you to use fully. It gives increasingly transparent and accessible details, not only on expenditures, but also on implications in terms of the Canadian government's resource management. We also have executives who are working both on departmental planning and results. I actually submitted the departmental results for 87 departments and agencies yesterday.
So there is a lot of information that supports the lessons we have learned from the pilot project.
Mr. Drouin, thank you for these relevant and well-informed questions.
As everyone knows, in the first year of the pilot project, vote 40 was used to enable committee members and parliamentarians to find out the results of the reconciliation between the budget process and the estimates more quickly.
Parallel to that, there is now a reconciliation table every time a budget is tabled, which increases parliamentarians' ability to obtain transparent information.
In the second year, following recommendations from parliamentarians, vote 40 disappeared. That was an excellent development that led to a subdivision of much more useful data in the reconciliation table between the Finance Minister's budget and the estimates.
Now, parliamentarians have the responsibility to guide us through the next steps. A number of projects have been implemented over the past few years, and we are very proud of that, especially GC InfoBase and the reconciliation table. An increasing amount of information is available in an accessible format to all Canadians.
We want to and have to do more, and we are counting on you to help us.
Thank you for this question, Mrs. Vignola.
As the president mentioned, the vote has existed in the tool kit for many years as an essential vote to provide for government-wide initiatives.
It all depends on which initiatives are coming forward. If you look at what's been supported, it's indigenous, early learning and child care. In this case, there are application modernization initiatives that Mr. McCauley mentioned. There's support for Phoenix damages that have been identified. These are instances in which Treasury Board authority is given for supporting the initiative, but we don't know exactly which vote it's going to end up in because a lot of times it's demand-driven. A lot of times there's a payment, or a partial payment, that's required before the next appropriation act is set out.
Transparency is provided, just as for any other initiative, so that parliamentarians can ask the questions they wish to in order to get more information. As items are allocated from that vote, it is reported online as we table the next estimates document. In this case Mr. McCauley mentioned, I think, $3 million to $4 million for the application modernization initiative.
The other thing to point out on that question is that there are many departments involved in that initiative. When authorities are provided for new funding, they're given to those departments, irrespective of a point in time where they are in a certain lapse forecast. Lapse forecasts change all the time, so it would be inappropriate for a government, or a parliament, to keep approving funds with inappropriate information on what the financial situation of a government is.
We have “The Fiscal Monitor” that provides information on an ongoing basis. We have loads of financial reporting that provides this information, so it is simply one of many departments in that initiative.
Thank you, Irek, and welcome to the committee and to Parliament, and thank you for your leadership.
Now, here are three brief things.
First, it's absolutely essential to be mindful of the anxiety that Canadians feel toward the effects of climate change and of course the impacts that these effects have on their lives.
Second, we have a broad set of measures, including pollution pricing, that are setting Canada on a more sustainable path and greater economic growth, and making life more affordable through pollution pricing in particular. In the supplementary estimates, there are a number of expenditures that relate to carbon pricing. There is $109 million for the Department of the Environment to implement the climate action incentive fund, which, as you well know but it deserves to be repeated, puts more money in the pockets of the large majority of households in Canada than the price on pollution imposes. That's not only benefiting the majority of households, but it also reduces poverty. It helps the more vulnerable Canadians do well and live more fully in Canada.
The last thing I wanted to say is that the Government of Canada also needs to be a leader. Since 2005, the greenhouse gas emissions of the Government of Canada have been reduced by a third. Our Paris target is 30% between 2005 and 2030. In the federal government we have reduced greenhouse gas emissions by more than that, by a third, and we're only in 2020. Therefore, we have the ambition of getting to a lower level of greenhouse gas emissions by 2030 than what we announced in the Paris Agreement.
Thank you very much, Mr. Chair.
I'm struck by the figures coming out of the Canada student loan program writeoffs. I'm sure members around this table can recall when they went to university. I know that for me it was not too long ago. If I recall, I was paying about $3,500 in tuition at Acadia at the time. At that time it was very expensive. I have deep concerns about the increasing financialization of post-secondary education as it relates to providing equal opportunities to everybody to be able to engage in our post-secondary education system.
Mr. Chair, when I look at 33,098 writeoffs, I have to wonder what we're doing in terms of saddling this whole generation of students with debt.
A voice: No, we're not.
Mr. Matthew Green: Well, we are. If they're writing it off, you can imagine the collections process that happens for students who are having to write off this debt, it also has ancillary implications on their financial outlook. Even though the government's writing it off, you can imagine the pressure that's on these students.
As we look at the rising costs of every aspect of life—the financialization of education, housing, food, transit—the question is put quite rightly. This is obviously the writeoff on the previous estimate. What factors do you think account for the increased dollar value in unrecoverable debt from 2019 to 2020 in the fiscal year, compared to 2018 to 2019? If you care to comment on my colleague's comment, what are the consequences for students when this debt gets written off on their behalf?
Mr. Purves, I realize we don't agree on a lot of things. I have to take great offence at your comment about misrepresentation.
If you look up the definition, it's providing fake or false information. I don't believe my comments about the use of vote 10 ballooning from past years traditionally being $3 million a year is false or misrepresentation. I hope you were perhaps using that word wrong.
I want to get back to the vote 10 issue. Traditionally it has been $3 million. I think you commented to my colleague, Mr. Aboultaif, about the use of it in a crisis response. I want to go back to the last world crisis we had financially in 2008. The vote 10 then, I think, only went up to about $8 million. Again, no government—Liberal or Conservative—had used this in the past to the extent that it has been used this year and last year.
The vote 5 money, which is contingency money, is where I would think such money should be coming from, not an inflated vote 10. I will state again that if the government tries to bring forward a $200-million, $300-million or $380-million vote 10 in the estimates again for the coming year, I believe the opposition will look to reduce it to the traditional level of around the $3-million mark as it has been used repeatedly.
Getting to vote 5, there's money in vote 5 for almost $5 million for Rideau Hall Foundation. Vote 5, “...to provide for miscellaneous, urgent or unforeseen expenditures not otherwise provided for...”. Rideau Hall Foundation has been funded for the last eight or 10 years by the government. I'm wondering how this $4.9 million, therefore, is considered unforeseen and urgent. Again, this should be Heritage Canada re-profiled over $5 million.
I bet you'll ask Marcia.
If I recall, I believe my mother actually worked on the connecting Canadians program for the Department of Industry way back in the nineties, so I'm glad to see that we're still on that.
In your mandate letter, the asked you to help ensure that people of all gender identities, indigenous peoples, racialized people, persons with disabilities and minority groups are reflected in positions of leadership.
In June 2019, this committee published a report entitled “Improving the Federal Public Service Hiring Process”, which noted that the Government of Canada should develop initiatives and programs to attract and hire more women in certain fields, such as STEM; more people with disabilities; more indigenous people; and more members of visible minorities. Morever, they should not just be hired for entry-level positions.
What concrete actions do you plan to take to ensure that the number of women in certain fields, people with disabilities, indigenous people and members of visible minorities increases in the public service, including in leadership positions?