PACC Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Public Accounts

EVIDENCE

CONTENTS

Monday, May 26, 2003

¹

1530

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

Mr. Hugh McRoberts (Assistant Auditor General, Office of the Auditor General of Canada)

¹

1535

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis (Assistant Deputy Minister, Infrastructure and Environment, Department of National Defence)

¹

1540

¹

1545

The Vice-Chair (Ms. Beth Phinney)

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

Mr. Hugh McRoberts

Mrs. Wendy Loschiuk (Principal, Office of the Auditor General of Canada)

Ms. Val Meredith

Mrs. Wendy Loschiuk

Ms. Val Meredith

Ms. Karen Ellis

Ms. Val Meredith

Ms. Karen Ellis

Ms. Val Meredith

Ms. Karen Ellis

¹

1550

Ms. Val Meredith

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Mr. Roger Gaudet (Berthier—Montcalm, BQ)

Ms. Karen Ellis

¹

1555

Mr. Roger Gaudet

Ms. Karen Ellis

Mr. Roger Gaudet

Ms. Karen Ellis

Mr. Roger Gaudet

Ms. Karen Ellis

Mrs. Ginger Stones (Director General, Environment, Department of National Defence)

Mr. Roger Gaudet

Ms. Karen Ellis

º

1600

Mr. Roger Gaudet

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Mr. Shawn Murphy (Hillsborough, Lib.)

Ms. Karen Ellis

Mr. Don Edgecombe (Director, Environmental Stewardship, Department of National Defence)

Mr. Shawn Murphy

Mr. Don Edgecombe

Mr. Shawn Murphy

Mr. Hugh McRoberts

Mr. Shawn Murphy

Mrs. Wendy Loschiuk

Mr. Shawn Murphy

Mr. Hugh McRoberts

º

1605

Mr. Shawn Murphy

The Vice-Chair (Ms. Beth Phinney)

Mr. Hugh McRoberts

Mr. Shawn Murphy

Ms. Karen Ellis

Mr. Shawn Murphy

Ms. Karen Ellis

Mr. Shawn Murphy

Ms. Karen Ellis

Mr. Shawn Murphy

The Vice-Chair (Ms. Beth Phinney)

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

º

1610

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis

º

1615

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis

Mr. Paul Forseth

Ms. Karen Ellis

Mrs. Ginger Stones

The Vice-Chair (Ms. Beth Phinney)

Ms. Colleen Beaumier (Brampton West—Mississauga, Lib.)

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Mr. Hugh McRoberts

The Vice-Chair (Ms. Beth Phinney)

Ms. Colleen Beaumier

The Vice-Chair (Ms. Beth Phinney)

Ms. Val Meredith

º

1620

Mr. Hugh McRoberts

Ms. Val Meredith

Mr. Hugh McRoberts

Ms. Val Meredith

Mr. Hugh McRoberts

Ms. Val Meredith

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Mr. Mac Harb (Ottawa Centre, Lib.)

Ms. Karen Ellis

Mr. Mac Harb

Ms. Karen Ellis

º

1625

Mr. Mac Harb

Ms. Karen Ellis

Mrs. Ginger Stones

Mr. Mac Harb

Ms. Karen Ellis

Mrs. Ginger Stones

Mr. Mac Harb

The Vice-Chair (Ms. Beth Phinney)

Mr. Roger Gaudet

Ms. Karen Ellis

Mr. Roger Gaudet

Ms. Karen Ellis

º

1630

The Vice-Chair (Ms. Beth Phinney)

Ms. Karen Ellis

The Vice-Chair (Ms. Beth Phinney)

Mr. Hugh McRoberts

The Vice-Chair (Ms. Beth Phinney)

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CANADA

Standing Committee on Public Accounts

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NUMBER 031

l

2nd SESSION

l

37th PARLIAMENT

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EVIDENCE

Monday, May 26, 2003

[Recorded by Electronic Apparatus]

¹  (1530)  

[English]

    The Vice-Chair (Ms. Beth Phinney (Hamilton Mountain, Lib.)): I'll call the meeting to order.

    It's Monday, May 26 and we're considering chapter 7, “National Defence--Environmental Stewardship of Military Training and Test Areas”, of the April 2003 Report of the Auditor General of Canada.

    We have six witnesses today. From the Office of the Auditor General we have Mr. McRoberts, Ms. Loschiuk, and Ms. Smith. From the Department of National Defence we have Ms. Ellis, Ms. Stones, and Mr. Edgecombe.

    I think we'll start with your statement, Mr. McRoberts.

    Mr. Hugh McRoberts (Assistant Auditor General, Office of the Auditor General of Canada): Thank you, Madam Chair.

    Thank you for this opportunity to meet with the committee to discuss Chapter 7 on environmental stewardship of military training and test areas. With me today are Wendy Loschiuk, principal responsible for our audits of National Defence, and Anne-Marie Smith, our legal advisor.

    The challenge for National Defence is to train its people on one hand and manage the environment on the other. We understand the demands of realistic military training and its impacts on the land, but we were concerned when we found instances where National Defence had not shown the environmental stewardship we expected to see. We found instances of non-compliance with environmental protection legislation and examples where the military continued training in areas already identified as unsuitable. While it is working on sites potentially contaminated by unexploded ordinance, more needs to be done. The department has a protocol for managing environmental issues, but needs to better implement it.

    First, National Defence, like other departments, must comply with environmental laws. We had cited examples of non-compliance with the Fisheries Act, one case of non-compliance with the Forestry Act, and our concerns about compliance with the Canadian Environmental Assessment Act. Because of the length of time taken to address environmental issues, we believe these examples point to ongoing problems. While investigating two of the examples, the department itself concluded that there was insufficient attention given to environmental concerns.

[Translation]

    Military training and test activities have continued for decades on land set aside for that purpose. But today, laws have changed. While training and testing should continue, National Defence must ensure the areas are sustainable. The Committee may wish to ask National Defence to demonstrate how it is fully complying with environmental legislation and practising sustainable land use.

    National Defence understands its responsibilities and is aware of its obligations. The Department's own Manoeuvre Area Planning System, or MAPS, was developed in 1996 to study training and test impacts and how to deal with them. However, seven years later, MAPS needs to go beyond the studies and into mitigation, restoration, monitoring and follow-up. The Department needs to move more quickly to implement measures to prevent environmental degradation.

[English]

This is particularly important for training areas that are too sensitive for continued training. Our audit showed the department was inconsistent in its approach to dealing with these lands. Only some of the bases put sensitive ranges off limits.

    What prevented the maneouvre area planning system from being used? Communication about implementing MAPS wasn't clear, there was no follow-up on what happened after studies were completed, and funding for recommendations must compete with other priorities. At the bases we reviewed we saw action on about one-third of the MAPS recommendations. This finding did not agree with the department's 2000-2001 performance report stating MAPS had been implemented on those bases. National Defence should be encouraged to continue implementing MAPS and ensure that priorities, timelines, and costs are in its business plans and performance reports to Parliament.

    In October 2002 the Commissioner of the Environment and Sustainable Development reported that the federal government was not dealing with contaminated sites promptly. We focused on live-fire ranges and wanted to know if the potential for contamination was being managed in a prompt and ongoing way. The science of identifying live-fire contamination is still developing--what is left in the soil, what risks does it pose, and how do we deal with it? Defence Research and Development Canada was asked by the army to test some of its pieces. However, this can be costly and funds are limited. We are concerned that the work may not proceed as needed. If there is contamination in the soil, it needs to be fixed. The department must identify all contaminated sites, determine priorities and costs, and track progress, and it should know the potential for contamination when foreign militaries fire munitions in Canada and how these countries will contribute to clean-up costs.

    Most training areas can sustain military training if measures are taken to address environmental stress. Future use of land depends on good environmental management. Unresolved problems can grow worse, until areas become unsuitable for training or mitigation, and restoration becomes more costly down the road. The committee may want to ask the department how it plans to make the environment a more prominent concern when planning activities and setting priorities.

    Madam Chair, this concludes my statement. We would be pleased to answer any questions. Thank you.

¹  (1535)  

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

    Now we'll hear from Ms. Ellis, the ADM for Infrastructure and Environment, Department of National Defence.

    Ms. Karen Ellis (Assistant Deputy Minister, Infrastructure and Environment, Department of National Defence): Thank you, Madam Chair.

    I would like to begin by thanking you for giving me the opportunity to address this committee and to give some specific discussion on chapter 7 of the 2003 report of the Auditor General of Canada. Although I accompanied the Minister of National Defence when he appeared before the Standing Committee on Environment and Sustainable Development on May 15, 2003, this is my first appearance before this committee.

[Translation]

    I would like to introduce Ginger Stones, Director General of Environment, and Don Edgecombe, Director, Environmental Stewardship, who are here with me today. Other officials are also present and are at the Committee's disposal to answer any specific technical questions that you may wish to raise.

[English]

    I would like to make three points before I address some of the specific issues made by the Auditor General. First, the Department of National Defence and the men and women of the Canadian Forces take their environmental responsibilities very seriously. Second, in doing so, the organization has to continually strive to find the best possible balance between the need for realistic operations and operational training, environmental protection, and resource availability. Third, we confirm and appreciate the Auditor General's comment that National Defence has committed itself to practising sustainable development and protecting the environment when it conducts its activities. I can assure the committee that the chain of command and the men and women of both the Canadian Forces and the Department of National Defence recognize that this commitment will involve ongoing assessment and continual improvement.

    I would like to start now by thanking the Auditor General for her observations in this specific chapter, and I would like to address some of the issues raised in the report. The report examined activities dating back eight years before we adopted many of the programs we now have in place. The area of examination included training and test sites covering more than 1.7 million hectares, 94% of the land holdings of National Defence.

[Translation]

    Within this very broad scope and timeframe, the audit identified only a few incidents in which our performance was less than satisfactory. And the report acknowledges that we had already taken corrective action in most of these cases.

[English]

    Chapter 7 identifies some instances in which our training-related activities may not have reflected due diligence. In one case the audit examined efforts to mitigate damages caused by the discharge of silt into a small stream at Canadian Forces Station Aldergrove in British Columbia in the fall of 1994. Although the department concedes that it was slow to respond, the affected area was fully restored. In another case the report suggests there was a potential contravention of the Fisheries Act through the deposit of batteries and other material in the waters off Nanoose Bay in British Columbia. However, the Department of Fisheries and Oceans has accepted the finding of an environmental assessment in 1996 that there were in fact no negative effects on fish or fish habitat in the area. We are in the process of updating that 1996 assessment, and we are working with Fisheries and Oceans to ensure that we continue to act in accordance with federal environmental legislation.

¹  (1540)  

[Translation]

    With respect to the case involving the silting of streams at Gagetown, I am pleased to report that we are working closely with the Department of Fisheries and Oceans to deal with the situation as expeditiously as possible and are developing a multi-faceted project to address sustainable training at Gagetown.

[English]

    Chapter 7 focuses on our manoeuvre area planning system, MAPS, protocol. This protocol calls for the study of the environmental effects of our training activities and for the development and implementation of plans to mitigate any potentially negative effects. One of the targets of our sustainable development strategy is the full implementation of this protocol, and we expect the priority recommendations to be implemented by the end of March 2004. We intend to review our progress in implementing the protocol and will take appropriate action to ensure that our efforts remain timely and effective.

    One of the most significant challenges the department faces is how we deal with contaminated sites. The Department of National Defence is responsible for approximately 1,600 known or suspected contaminated sites, with a current estimated cost of $769 million to remediate and manage them. Over the last 10 years we have spent an average of more than $40 million per year to clean up contaminated sites.

[Translation]

    We will continue to work to clean up and manage risk at all our contaminated sites, most of which are the result of outdated practices, no longer in effect. This endeavour will take more time than originally foreseen. Nevertheless we are committed to pursuing a proactive and responsible approach to remediation.

[English]

We are also developing a new departmental environmental directive on contaminated sites, as well as updating our existing contaminated sites remediation framework.

    Energetic contamination caused by the use of live munitions in training exercises is clearly a serious issue for the Canadian Forces. In fact, the Department of National Defence has been funding leading-edge research on the environmental aspects of energetic material for the past five years. We are committed to pursuing this research.

[Translation]

    In accordance with the recommendation of the Auditor General, we are also initiating a process to collect information on the composition of ammunition being fired by foreign militaries in Canada.

[English]

    The fourth section of chapter 7 deals with the issue of sustained use of military training and test areas. The men and women of the Canadian Forces rely on our training areas to develop, practise, and hone their military skills in a variety of geographic and climatic situations. However, the training and testing activities that are required to maintain a high level of military readiness and proficiency can often generate complicated environmental consequences. As the Auditor General rightly indicates, the Canadian Forces are facing many challenges in the area of sustainable training. However, as we stated in the audit chapter, we are committed to monitoring our progress in the areas raised by the Auditor General, as well as proceeding with initiatives that were already under way.

[Translation]

    As we move forward to fulfill our environmental responsibilities, we have to remain mindful of DND's mandate “to defend Canada and Canadian interests and values while contributing to international peace and security”.

[English]

At National Defence our environmental programs are a high priority. We are proud of our record in environmental stewardship, which has been judged by the Commissioner of the Environment and Sustainable Development to be among the best in government. At the same time, we do recognize that continual improvement is the key to progress on any environmental strategy.

    We thank the Auditor General for her observations, and we look forward to a constructive dialogue with you.

    Thank you.

¹  (1545)  

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

    I would ask the witnesses to remember that all the members here will have questions. In the first round they'll have eight minutes, and if you can keep your answers concise, they will get more of their questions in.

    Ms. Meredith.

    Ms. Val Meredith (South Surrey—White Rock—Langley, Canadian Alliance): Thank you very much, Madam Chair.

    Thank you to the Auditor General's department and to the members from the defence department.

    The thing I find interesting more than anything else is that there does seem to be a contradiction between what the Department of National Defence is telling us and what the Auditor General's department is telling us. Ms. Ellis, you said they identified only a few instances in which your performance was less than satisfactory, and you'd already taking corrective action in most of these cases. Yet the Auditor General has pointed out that the findings did not agree with the department's 2000-2001 performance report stating MAPS had been implemented on those bases. Why the discrepancy, Mr. McRoberts?

    Mr. Hugh McRoberts: Perhaps I could ask Ms. Loschiuk to address that question.

    Mrs. Wendy Loschiuk (Principal, Office of the Auditor General of Canada): Thank you.

    We looked at the sustainable development strategy, what was required in there for reporting. The performance report says the MAPS had been fully implemented in these bases they named. We looked at those bases and disagreed with the level of implementation, as we found that recommendations had not been completely implemented. In our interpretation, more was required of MAPS than was indicated.

    Ms. Val Meredith: Your comment, I believe, was that only a third had been implemented.

    Mrs. Wendy Loschiuk: On average, yes.

    Ms. Val Meredith: So when they say almost all cases have been corrected, that has not been substantiated, as only a third of the corrective actions would appear to have been taken. Would you agree with that, Ms. Ellis?

    Ms. Karen Ellis: I would just like to clarify. I think there are two issues contained here.

    The first question is to do with compliance with some of the federal legislation. Those were the minor issues we did address, working with the regulating department, as in the Aldergrove case I mentioned and some of the others. So there were some areas where we were out of compliance in a minor way with some federal legislation. The regulating departments chose to work with us to identify them and to address and resolve those situations, which we did in all of those cases.

    The second issue you raised concerns MAPS implementation and the Auditor General's comment that not all the recommendations had been implemented.

    Ms. Val Meredith: Only one-third.

    Ms. Karen Ellis: My understanding is that the assessment of that by the Auditor General was of a quantitative nature, looking at how many recommendations had been made and how many of those had actually been implemented. We respectfully disagree, in the sense that when the local base and wing commanders are working with the MAPS, they do implement those elements that make the most sense and they are able to. Sometimes local decisions will have been taken that mean perhaps not all recommendations, quantitatively, have been implemented, but only the ones they can and that make sense to them from the training and operations perspective. I think that would account for the discrepancy.

    Ms. Val Meredith: With regional decisions or local decisions, qualitative or quantitative, what happened in Gagetown? Apparently, the staff didn't really have authority to enter into any kind of contract to remove the trees, to get into land clearance. Where did they get the direction to clear the land?

    I guess the concern is that somebody took it upon themselves to clear some land and put out, I understand, 50 contracts. They got about two-thirds of the value the Canadian Forest Service feels they should have got for it. It's really a question not of whether it happened, but of whether you have implemented a process to make sure that kind of thing does not happen in the future, that the local headquarters or whoever has full control to make sure all acts of the government are complied with and this sort of thing doesn't happen again. Have you made some serious changes in the way you proceed?

    Ms. Karen Ellis: On this question of Gagetown, it's important to note that National Defence conducted a full investigation into the land-clearing activities. The Auditor General herself quoted the conclusion of our own investigation into that case, and it says there was nothing “to show that any public servant or CF member had knowingly broken the law, or hidden information, or profited personally from the Gagetown expansion.” The findings of that internal report are currently being reviewed within the department, and appropriate action is being and will be taken to implement the advice in there.

    This is a very important issue. Whenever we look at a situation in the department, whenever we do an investigation of this or any other kind or an internal review, we do take very seriously the findings and the lessons learned out of that. The internal review has given advice and recommendations to the department, we are working on implementing them now and into the future, and we'll use every opportunity to reinforce communications on problem areas, to do our very best to ensure that nothing like this happens again. We can always communicate better on these issues.

¹  (1550)  

    Ms. Val Meredith: I come to the comments you made regarding Nanoose Bay. Sitting on the mainland side of that whole area, I find it a little distressing that you would take a report that says dumping ammunition and contaminated batteries and materials into that bay is not harming the fish population. I don't know if you're aware of the problem with the salmon stock that coast is having. I find it incredible that you would assume from a report taken a number of years ago that you're off the hook. Do you feel you have no commitment in the Nanoose Bay area to make sure contamination from dumping materials in that bay is not having an effect?

    Ms. Karen Ellis: I appreciate your concern, and I would like to reiterate a very important message. We take all environmental issues seriously at National Defence, and there's not one part of the country where we don't have an even level of concern. This was an environmental assessment conducted in 1996, with Fisheries and Oceans agreeing that there was no evidence of damage to the habitat or to the fish. As I did mention earlier, we are doing a review right now of that environmental assessment, so the whole issue will be looked at again, and we'll be working with Fisheries and Oceans to make sure we continue to comply with legislation. We do have data collection that has been ongoing and we have to keep working on, but we are reviewing that 1996 assessment, and we'll be updating it.

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

    Monsieur Gaudet.

[Translation]

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

    Ms. Ellis, on page 5 of your presentation, you note that there are 1,600 known or suspected contaminated sites. Can you tell me in which provinces these sites are located?

    Ms. Karen Ellis: Regarding contaminated sites, we are participating in a process initiated by the Treasury Board of Canada.

[English]

They have a major inventory of all the contaminated sites that fall under the jurisdiction of federal departments, and we are indeed feeding into that inventory. We will have our first full report to the Treasury Board by July of this year. At this time I do not have a list I can share with the committee, but we are working on elaborating our list, and we will be feeding that into the Treasury Board as an overall report in July.

¹  (1555)  

[Translation]

    Mr. Roger Gaudet: Thank you. I have a second question.

    You indicated that over the last ten years, the department has spent $40 million per year to clean up contaminated sites and that the cost of the cleanup is estimated at $769 million. Did I understand you correctly? I'm still on page 5.

[English]

    Ms. Karen Ellis: For the 1,600 known or suspected sites, our current estimate is that it would cost $769 million to remediate them from this point and into the future. I was describing in my opening remarks the investment made to date for cleaning up contaminated sites.

[Translation]

    Mr. Roger Gaudet: Therefore, it will cost $769 million to clean up 1,600 sites so that they can be used for farming or forestry activities, for instance. Will $769 million be enough to clean up these sites thoroughly?

[English]

    Ms. Karen Ellis: We basically have to make a choice, when we are doing an assessment of contaminated sites, whether the assessment indicates we can do a successful clean-up or we actually decide to do a risk management approach on the site, where it's a better use of resources and the risks are such that we can manage it over time, rather than doing a whole clean-up. Every site has to be assessed individually and prioritized in respect of how soon we will clean it up, or the approach we'll take, clean-up, remediation, risk management. There's a variety of different decisions depending on the assessment of the sites.

[Translation]

    Mr. Roger Gaudet: Take last year, for example. Which sites were cleaned up at a cost of $40 million?

[English]

    Ms. Karen Ellis: I will refer this to Ginger Stones.

    Mrs. Ginger Stones (Director General, Environment, Department of National Defence): Thank you.

    Our clean-up activities in the past year can be divided into various categories. We have those that are handled corporately, the larger clean-ups, as with that of the distant early warning line radar chain that's across the Arctic. We've been cleaning those up over a number of years. We have sites we are cleaning up on bases we are decommissioning. Also, there would be sites on active bases that have been identified, and we are cleaning those up as well.

[Translation]

    Mr. Roger Gaudet: How do these National Defence contaminated sites tie in with the Kyoto Protocol? How do you see things unfolding in the future? The Canadian government has signed the Kyoto Protocol. What action will you recommend be taken to implement the terms of the Protocol?

[English]

    Ms. Karen Ellis: Again, that's an issue at the heart of all of government thinking on environmental policy, the reduction of greenhouse gases. The Department of National Defence, because it has such large holdings in land and vehicles and fleets, has a major role to play in making contributions to reducing greenhouse gases. We have made a commitment to reduce our own department's greenhouse gas emissions by about 135 kilotonnes between 1998 and 2010. We anticipate that we will be on target to meet those reductions, and that is a very significant contribution to helping the government meet its commitments on climate change.

    We have done this primarily through something that's part of the federal building initiative. We do energy performance contracts. We engage the private sector up front, we ask them to come and retrofit our buildings to make them more energy-efficient, and we pay them after the fact with the energy cost savings we make from the retrofitting. This is a good initiative, because it contributes to greenhouse gas reduction, but it also brings operational savings to the department.

º  (1600)  

[Translation]

    Mr. Roger Gaudet: Thank you.

    Moving on to the topic of prevention, how does DND feel about the US anti-missile shield? What about the environmental impact of exploding missiles?

[English]

    Ms. Karen Ellis: Respectfully, I must say this is an area outside my expertise. I would be unable to provide any information, and it would be inappropriate for me to speak on a matter that falls more to my colleagues who are expert on this in the Department of National Defence.

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

    Mr. Murphy.

    Mr. Shawn Murphy (Hillsborough, Lib.): Thank you very much, Madam Chairman.

    Thank you to the presenters.

    The first question I have, Madam Ellis, is on the timber contracts in Gagetown, New Brunswick. Was there a public process followed in the letting of contracts?

    Ms. Karen Ellis: I'll refer that to Mr. Edgecombe.

    Mr. Don Edgecombe (Director, Environmental Stewardship, Department of National Defence): Yes, there was a public tender call for the contracts.

    Mr. Shawn Murphy: To all the people in that industry in that particular area?

    Mr. Don Edgecombe: I would assume so, yes.

    Mr. Shawn Murphy: My next question is to the Auditor General, and this is a difficulty I have in some situations. If we followed a public tender process and it was adequately and widely advertised, I have difficulty with complaining about the value after the fact. Can I get your comments on that?

    Mr. Hugh McRoberts: Before you get into a tender call of this type, particularly where you're involved in a barter relationship, it is expected, both with the forestry management agreement and as good business practice, that you first assess the value of what you are offering. I think, in fact, we would expect there to be a floor price below which any and all tenders offered would not be accepted.

    Mr. Shawn Murphy: It sounds great on the second floor of the West Block, but sometimes it doesn't work. Who would do this so-called assessing?

    Mrs. Wendy Loschiuk: With the contracts at Gagetown, we didn't look at the whole process. We were more concerned about what happened after the contracts were let. We took as given that this arrangement was entered into and there were impacts on the environment as a result of what had gone on, the land-clearing. We wanted to know why this land-clearing had gone on, and so we asked the question, how did all this come about? That was pretty much the scope of our examination: contracts have been signed, now what are the impacts? Here's the value that was assessed, and here is the result on the environment since then.

    Mr. Shawn Murphy: I agree with you 100%. If there were environmental issues, they should have been dealt with, if there was lack of authority in signing those contracts, that should have been dealt with, and I'm going to question Ms. Ellis on those. But I'm assuming there was a full public tender process and a public bidding process, and somebody in Ottawa is now saying the bid was only $4 million, where somebody's put a value on it after the fact of $6.7 million. My premise is that if there was an open process and it was followed correctly, the value at that point in time was $4 million. Do you agree with me?

    Mr. Hugh McRoberts: Without having audited this aspect of the process in detail, our expectation is that due diligence in the expenditure of public assets would have required that what was offered in payment be valued and that there be a balance between what was offered and the tender that was accepted.

º  (1605)  

    Mr. Shawn Murphy: Well, we'll agree to disagree, but you can see the problems it causes. You make this statement that it was $6.7 million, we've no idea how that's assessed, and it becomes an issue. I'll make the point again: if there was an open public process, that was the value, not somebody's assessment two or three years after the fact. I want to move on, I'm just making my statement.

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

    Mr. Hugh McRoberts: Perhaps I could just point out, as we indicate in the chapter, that the evaluation was done by the Canadian Forest Service, which had a co-management agreement with DND with respect to these forests.

    Mr. Shawn Murphy: Again, I think we've made our point.

    My next line of questioning, Ms. Ellis, again with the Gagetown situation, is on the lack of authority to sign the contracts and the environment problems that did arise on the salmon river there. I ask this question to a lot of witnesses that appear before this committee. Now we're dealing with the situation after the fact, and you talk about lessons learned here. Was anyone in the Department of National Defence disciplined over this particular set of circumstances? I should point out that the answer I get from every witness is no.

    Ms. Karen Ellis: With the investigation that was done and the report and recommendations that came out of that being under review in the department, the department is looking at the best ways to address the issues raised in that report. So I would not be able to answer your question with any more precision than that, other than to say the department will take appropriate action to address the concerns that were raised. Indeed, if there are issues that need to be communicated on different kinds of practices, they will be communicated, not just in the case of Gagetown, but as a reminder to people across the department on any generic questions that came up here. I'm sorry I can't be more precise than that, but I don't have any additional information on the specific question you've asked.

    Mr. Shawn Murphy: To summarize your answer, as far as you're aware at this point in time, no one has been disciplined with respect to this particular situation?

    Ms. Karen Ellis: That's right.

    Mr. Shawn Murphy: The report indicates that there are approximately 1,600 contaminated sites presently under administration by DND. Are you reasonably confident that there won't be any more added to that? You have made a lot of improvements and a lot more standards have been set for the department.

    Ms. Karen Ellis: With a large number of sites, as indicated, and the attention the department's paying to them, that's an important question. I cannot personally guarantee that we will never have another small fuel spill or anything else, nor can I guarantee that we won't discover something as we work on decommissioning bases. So there could be additional contaminated sites identified in the future. We hope that will not be a large number and our ongoing remediation, clean-up, and risk management of other sites will mean that the overall number declines over time. That is our plan, and we're trying to work at it as responsibly as we can with the resources available. We take this one really seriously, as we do all our issues. I wish I could make that guarantee, but I think it would be unwise of me to do so.

    Mr. Shawn Murphy: Thank you very much.

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

    Mr. Forseth.

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

    On page 12 of the Auditor General's report we find that the Commissioner of the Environment and Sustainable Development “found that despite having first recognized the need to address the problem of federal contaminated sites over 13 years ago, the federal government still does not know how many of its sites are contaminated, does not know the full extent of the risks to human health and the environment and the likely cost of cleaning up or managing the sites, does not have a ranking of the worst sites by order of risk, does not provide the long-term, stable funding needed to manage the problem effectively, and most important, does not have a firm central commitment and leadership or an action plan essential to the timely clean-up or management of the higher-risk contaminated sites under its control.” I was quite amazed to hear that with some of the remediation, you leave it up to them locally to decide. There's no comment about outside monitoring. You're leaving the contaminators to clean it up as they see fit, without any independent monitoring or certification. Then you repeatedly say how seriously you take the plans, the record, and the ethics and values of what we have committed ourselves to nationally. I've heard that repeatedly in this committee, the environment committee, and many other committees. We've had the minister make announcements. We've seen the maps in the hallway of Centre Hall of our contaminated sites.

    I just have to remind you, you're under oath when you come here. It's not just you folks, it's repeated committee after committee after committee. After that time we begin to wonder just at what point does it become contempt of Parliament to make these kinds of commitments, when we know for sure the job is not done. We know the “what” is beyond any kind of argument, but tell us why. You claim you have the capability, you have the knowledge of what needs to be done--and that's been said over and over again by ministers and bureaucrats on down in many different committees--yet today the department's promises to Parliament are unfulfilled. What we need is your help and advice to say why, rather than repeating the same kinds of things I've been hearing since 1993. Since I've been sitting in this room, how many times have I heard it from different delegations and the various ministers? You're going to have to help us, because the final accountability is with the public accounts committee when we look back at the track record of all those wonderful promises made under oath and find we're still not there. Why isn't it done?

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    Ms. Karen Ellis: I do appreciate the concern. In the Auditor General's report the comments you read out refer to all federal contaminated sites, not just those of the Department of National Defence, and I think it is important to clarify that. Indeed, there had been several previous audits looking at that whole issue and how the government as a whole was managing it.

    The Treasury Board did actually release a new policy, an overall policy on contaminated sites, in June 2002. Departments are now working to comply with the guidelines and directives set out in that policy. All the departments that have contaminated sites in their jurisdictions have to provide their first annual overall report on how they're managing those contaminated sites to the Treasury Board by July of this year, including DND. The other thing is that they do have an overall inventory of federal contaminated sites that has to be updated yearly. They're gathering the data, they're trying to be accountable, transparent, and clear on where the sites are and where all the departments are managing those sites.

    The Vice-Chair (Ms. Beth Phinney): Can I interrupt to ask if you can send us that report for July when you're finished?

    Ms. Karen Ellis: We will check with the Treasury Board on when that information can be released and get back to you.

    The Vice-Chair (Ms. Beth Phinney): It's not the timing I'm worried about. When your report is ready, please send it to us.

    Ms. Karen Ellis: Certainly.

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

    Ms. Karen Ellis: To continue, we have had a contaminated sites remediation framework or risk-based framework in place and operation since 1996. We have spent quite a lot of money so far, as we've said, an average of $40 million a year, on managing our contaminated sites, and we are continuing to prioritize, assess, and manage those sites year by year. We do have to provide an annual update from now on to the Treasury Board. I think you're going to see reporting across government, including from National Defence, getting better year by year.

    Mr. Paul Forseth: Part of it is the money being spent and the running around and the making of the maps and planning, but few sites are actually being remediated. You've been trying to get the German army to pay, because they were involved in training. World War II has been over for a little while. How have you done in getting more money from the Americans as their contribution? I take it in the past you got some money for Argentia, so what about getting the Americans to help us with both expertise and money?

    Ms. Karen Ellis: I'll refer that question Ms. Stones, who has a longer history on that particular issue.

    Mrs. Ginger Stones: There's a current agreement with the United States for $100 million over the space of 10 years as their contribution towards clean-up of four installations where they were active in Canada.

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

    Ms. Beaumier.

    Ms. Colleen Beaumier (Brampton West—Mississauga, Lib.): We're talking to you as if you're naughty children, and frankly, many of us think you have been. This and previous reports have indicated little or no progress in the military's approach to environmental issues. I look at the paper the Library of Parliament has done for us and I see that past and present audits have enumerated a number of lapses and there's little or no progress in addressing the outstanding problems, there's no evidence, it's just discrepancies. “Activities between 1988 and 2001 have aggravated problems identified in the 1998 environmental report, and yet no corrective measures have been implemented.”

    When you're talking about $769 million to remediate some of these sites, I'm wondering how many of these sites have been contaminated since the 1998 report or subsequent reports. According to this audit, it looks as though you say, yes, we're going to do this, yes, we're going to do this, but not only does it not get better, it actually gets worse, the behaviour anyway of the military. How can we be sure you're actually changing attitudes and cleaning up?

    Ms. Karen Ellis: With the Department of National Defence, as with many others, there were a lot of practices that took place years ago when standards were lower, and we're trying to do two things, clean up the legacy of the past and do business differently today and into the future. I can certainly say we have got an excellent policy on environment that is well communicated and understood in the department. One of the key principles in that policy is due diligence, and that means not just the chain of command and the leadership in the department, but individuals are expected to know and respect federal environmental legislation and to conduct themselves accordingly. We have made progress in dealing with contaminated sites, and to date we have on record 745 sites that have been remediated, are under remediation, or need no action. We do have numbers and statistics we're building into our first overall report that do show progress.

    The Vice-Chair (Ms. Beth Phinney): Do you have any comment to make on that, Mr. McRoberts?

    Mr. Hugh McRoberts: It would be difficult to give a definitive answer. We have taken one look at one point in time. I would note that we did indicate in our chapter, in the section beginning with paragraph 35, that there are some good examples of environmental management at training and test areas. We would like to see them do more, and that's what we have said in the chapter.

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

    You have half a minute.

    Ms. Colleen Beaumier: I really don't have any other questions. I'm beginning to sound like a lecturing mother.

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

    Ms. Meredith.

    Ms. Val Meredith: Thank you, Madam Chair.

    My question is for the Auditor General's department. You've heard the testimony from the Department of Defence that their environmental and sustainable development is, according to the Commissioner of the Environment and Sustainable Development, among the best in government. The defence department feel they're doing a really good job in dealing with this. Do you support that statement from them? Do you feel they're the best in government and are doing a really good job, responding the way they should be responding?

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    Mr. Hugh McRoberts: I was somewhat surprised by the reference to the commissioner's endorsement of National Defence. I have not had the opportunity to verify with the commissioner the source of that endorsement. I think I won't comment on that until I understand better what the source of it was and what the commissioner may or may not have said.

    I certainly have been encouraged by the tone of the answers the department has given to the committee today. It certainly indicates that they understand the seriousness of the problems they are faced with and that there is a real commitment to trying to deal with them. As we indicated in the chapter, what we saw was a mixed picture. We saw some very encouraging developments, which we have highlighted, but we also saw some problems with following those encouraging developments through and really pushing them over the top, so to speak. I was encouraged, for example, by the commitment on MAPS.

    Ms. Val Meredith: Part of the concern was that they had to be asked twice. It was pointed out once, and nothing was done, it was pointed out a second time, and maybe something was done. Do you feel you have heard a commitment from National Defence to actually do something, rather than just studying it, rather than just acknowledging it, rather than knowing it exists? Have you heard anything today that gives you some confidence that National Defence is going to get on with the program and actually do something? I may be putting you on the spot, but I know what I've heard, and I want to understand what you have heard.

    Mr. Hugh McRoberts: We have heard commitments, made on the record by the department, to do things, in some cases with a timetable. It would make us happier if we saw an actual action plan to respond to our recommendations. It's probably premature to expect the department to have prepared a complete action plan, but we will be looking for that. As you know, we will be seeing in our follow-up work how and how rapidly the commitments made today are in fact honoured.

    Ms. Val Meredith: What was the response from the department to your audits?

    Mr. Hugh McRoberts: The department indicated that it was satisfied with the accuracy of the chapter and that in general, it would be moving forward to respond to the recommendations we made.

    Ms. Val Meredith: Thank you.

    The Vice-Chair (Ms. Beth Phinney): I'm just going to ask Ms. Ellis if there actually has been an action plan yet. Is there one that's in use right now?

    Ms. Karen Ellis: We are preparing one right now in response to the chapter, which was out a few weeks ago.

    The Vice-Chair (Ms. Beth Phinney): When would that be ready?

    Ms. Karen Ellis: We expect to have that within a month.

    The Vice-Chair (Ms. Beth Phinney): Could we have a copy of that when you get it ready?

    Ms. Karen Ellis: Certainly. We have accepted all the recommendations made by the Auditor General.

    The Vice-Chair (Ms. Beth Phinney): And your action plan will be an action plan, not just what you think is a good idea?

    Ms. Karen Ellis: As we've got timeframes and targets on many of our initiatives, it would have the same kind of approach.

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

    Mr. Harb.

    Mr. Mac Harb (Ottawa Centre, Lib.): Thank you, Madam Chair.

    I'm quite happy when I hear Ms. Ellis mention that out of the 1,600 sites, there are--how many sites did you say you have taken action on?

    Ms. Karen Ellis: There are about 785 either remediated, or assessed as not needing it, or still in progress.

    Mr. Mac Harb: For the balance you're looking at setting up an action plan?

    Ms. Karen Ellis: Yes, an action plan that will capture what we're doing now and what we need to do in the future. It'll be updated every year.

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    Mr. Mac Harb: What really concerns me about all of this is not what National Defence is doing, but what other forces are doing on our land. You indicated that you are in the process of developing a database to find out who's finding what. When will that database be ready?

    Ms. Karen Ellis: As to what foreign militaries are doing on our land, that's not so much a database, but we do have specific agreements. Whenever a foreign military is training on one of our ranges, there has to be a clean-up provision and plan within that agreement. That's how we work with them for general clean-up of any munitions or anything they leave behind.

    I can ask Ginger Stones to add to that.

    Mrs. Ginger Stones: I would accept the recommendation from the Auditor General that we should identify if there are any munitions being used on our training areas by a foreign military that are different from the types of munitions we normally use. We are working to put in place that kind of feed-back loop, so that we can identify if there's anything new, something that we should be aware of, and take the appropriate action.

    Mr. Mac Harb: I am a bit illiterate on this unexploded ordinance. I suppose this is ammunition that has not exploded. On how many sites do you think we have this kind of situation, and is there a specific plan for this? As a normal citizen, the first thing that comes to my mind is, my God, here's a farmer or somebody who is venturing in, and an explosion takes place. Is that what we're talking about here?

    Ms. Karen Ellis: You're right, unexploded ordinance is ammunition that has not yet exploded.

    I'm going to pass the floor to Ginger.

    Mrs. Ginger Stones: Wherever we have live-fire exercises, we have the potential for unexploded ordinance. Those are on our property. The areas where this activity is undertaken are delineated on maps, and there's a standard operating procedure for what activities are allowed to go on in those live-fire areas. Also, routine clean-up is undertaken at various times on those live-fire ranges.

    Mr. Mac Harb: I'm quite happy with the response. It is my hope that the Auditor General will work closely with National Defence, and I'm looking forward to seeing their action plan for the remainder of the sites.

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

    Monsieur Gaudet.

[Translation]

    Mr. Roger Gaudet: Thank you, Madam Chair.

    If I understood correctly earlier, you stated that 785 sites are not contaminated. Correct? Let me put my question another way. Of the 1,600 sites, how many are not contaminated?

[English]

    Ms. Karen Ellis: We at present count around 750 of our sites that have been remediated, are under remediation, or need no action. So there are three categories that can be counted in that total. I shared that number to show the progress we have made and the work we are doing on contaminated sites.

[Translation]

    Mr. Roger Gaudet: Your remarks are somewhat contradictory. You note the following on page 2:

I can assure the committee that the chain of command and the men and women of both the Canadian Forces and the Department of National Defence recognize that this commitment will involve ongoing assessment and continual improvement.

    What do you mean by “assessment”? I thought an assessment had already been done and that the situation would improve day by day. What exactly is this assessment that you refer to in paragraph two on page 2?

[English]

    Ms. Karen Ellis: My reference at the beginning of my opening remarks was to our general commitment as a department to environmental stewardship and sustainable development. I'm basically saying that's something we encourage through our policy, through our communication, through our business planning every year, where we integrate environmental projects and stewardship. When my colleagues do a business plan, they have to build in their environmental projects and clean-ups. So we're talking about a culture we're trying to encourage and to build in caring for the environment with our individual employees, as well as through our leadership actions. That was a general reference to our approach and philosophy on environment.

    On the contaminated sites specifically, I was pulling examples out of the around 750 where we've taken action or made assessments that no action is required. It was an illustration of the work we're doing on contaminated sites. It was a separate category, even though it's under the general topic of environment.

º  (1630)  

    The Vice-Chair (Ms. Beth Phinney): I have one question.

    With the energetic material you were talking about, I think you're committed to spending $500,000 annually to clean up those sites. I think the army itself has decided that the total cost would be $9 million. That means it's going to take about 18 years to do this. Is there any thought of doing this a little faster or getting more of that $9 million now, rather than waiting 18 years?

    Ms. Karen Ellis: This brings us right back to the heart of the issue I mentioned in my opening statement. The department is always having to make decisions on environmental protection projects as against its core mandate operations and training, and factored into that is the availability of resources. On an annual basis, we have, through the business planning process, to make choices about where we're going to make expenditures and how quickly over a certain time we'll be able to make those expenditures. We are committed, however, to doing research, and in this area of energetics, for this current fiscal year the department has committed, through my own team in the environment group, $300,000, and the army commitment is $600,000. So in this year alone we're looking at almost a $1 million commitment to research in energetics.

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

    Mr. McRoberts, would you like to make a closing statement?

    Mr. Hugh McRoberts: Thank you very much, Madam Chair.

    As indicated in response to an earlier question, we have certainly seen DND make some progress in dealing with this very important area. We look forward to seeing the action plan that has been promised and to following up on the recommendations.

    I'd like to return very briefly to one area, though, and that's the manoeuvre area planning system, which I think we really see as being at the heart of the army's approach to managing its bases in a sustainable way. The witness from DND was correct that when we reported that one-third of the recommendations, on average, had been responded to, that was a quantitative assessment. One of the reasons is that for most of those there had been no plan done on the part of the base management to take the recommendations, to assess them, and to establish what are priorities. We would encourage the department to do that.

    We are also encouraged by the commitment that most of those recommendations will be implemented by March 2004. We would encourage the department in the future to report in its sustainable development strategy and its departmental performance report on its progress in managing the recommendations coming out of these manoeuvre area planning system studies. I would also note that these in many cases now will have to be renewed. So this will be an ongoing, cyclical thing and could be a useful area of performance reporting for the department.

    Thank you very much, Madam Chair.

    The Vice-Chair (Ms. Beth Phinney): Thank you very much. Thank you to all the witnesses.

    The meeting is adjourned.