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Results: 1 - 15 of 22
View Kevin Sorenson Profile
CPC (AB)
Good morning, everyone.
This is meeting number 128 of the Standing Committee on Public Accounts for Thursday, February 21, 2019.
We are once again here in consideration of “Report 1—Connectivity in Rural and Remote Areas” of the 2018 fall reports of the Auditor General of Canada.
We're honoured to have with us this morning, from the Office of the Auditor General, Mr. Jerome Berthelette, the Assistant Auditor General, and Philippe Le Goff, Principal.
From the Department of Industry we have the Deputy Minister, Mr. John Knubley. We also have Lisa Setlakwe, Senior Assistant Deputy Minister, Strategy and Innovation Policy Sector. We also have Michelle Gravelle, Director General, Audit and Evaluation Branch.
From the Canadian Radio-television and Telecommunications Commission we have Mr. Ian Scott, Chairperson and Chief Executive Officer; Mr. Christopher Seidl, Executive Director of Telecommunications; and Mr. Ian Baggley, Director General, Telecommunications.
For those who may be interested, we are televised today. We had these folks with us before, but we were interrupted by votes in the House. Typically, all they did at that time was their opening statements. We didn't get into very much questioning.
They have complied with our request and are willing to again give us an opening statement. We thank them for that.
We will now turn our time over to Mr. Berthelette.
View Pat Kelly Profile
CPC (AB)
Thank you, Chair.
Again at this committee we have a report from the Auditor General and departments that have said they accept the findings of the Auditor General, yet in the testimony I've heard, in particular in the answers to Mr. Christopherson's question, I sense push-back and defensiveness around the conclusion of the Auditor General.
Mr. Knubley, the Auditor General said that your department did not have a national strategy. Mr. Christopherson asked you why, and if I heard you correctly, I heard not only in response to his questions and to some of the other questions you repeatedly going back to the Johnston report of 18 years ago. It identified a strategy for which the objectives seem largely still unfulfilled 18 years later.
I'm going to repeat the question. Why was there no national strategy in particular after the CRTC declared broadband to be a public necessity? It's easy to declare something a necessity. Those are just words. Once you do that, though, there has to be a strategy and a plan to achieve objectives.
Please, do you accept the Auditor General's assessment that there was no national strategy, and if so, why?
View Pat Kelly Profile
CPC (AB)
Sir, you did not answer my question. You did not answer Mr. Christopherson's question.
Why was there no strategy? If this has been identified and understood for years, the objectives—
View Pat Kelly Profile
CPC (AB)
The reason is just that there wasn't coordination and there couldn't be coordination with provinces. That's why there was no national—
View Pat Kelly Profile
CPC (AB)
That's, then, a political question. You can have a strategy, a public strategy, but if a government won't fund your strategy, then that's a political question and one for the voters.
View Kevin Sorenson Profile
CPC (AB)
I think I'm going to interrupt a little bit here. I think we need to recognize that we are sometimes getting into policy here, and we need to remember that the Auditor General's responsibility is not to determine the validity of the policy. It's to determine whether or not there is a way to deliver the listed policy in an effective manner. I think all of us on the committee have to remember that the parameters of the audit as listed were to look and see if there was, I suppose, some value for money, but if it's found in the conclusion that Canada did not develop and implement a national strategy to improve.... That's the focus of the audit.
Sometimes we get into the weeds on everything else and maybe that's a good time to ask the department, but the auditors are not going to give us a broad synopsis of connectivity in Canada. They're going to look at these very tight parameters, and I think that's what we have to drill down on if we're coming to the Auditor General. We can branch off to the different sectors on their way, but we shouldn't really even be going to the policy at all because the government sets the policy, departments deliver, and auditors check to see if departments have delivered.
If I'm a Conservative and I don't like a Liberal policy, that's neither here nor there at this committee. The government sets a policy, the departments deliver on it, and the auditors ask, did they do it in the best way possible?
If we're going to ask about the process, you can ask the auditors about their audit, but everything else should go to the departments.
Mr. Graham.
View Pat Kelly Profile
CPC (AB)
Mr. Knubley, in response to Mr. de Burgh Graham's question, you spoke about having achieved acceptable value for money in several different ways. The findings of the Auditor General quite clearly say that they found that Innovation, Science and Economic Development Canada did not implement its connect to innovate program for broadband in a way that ensured the maximum broadband expansion for the public money spent. The program did not include a way of mitigating the risk of government funds displacing private sector investments.
Again, I ask you to square your acceptance of the Auditor General's findings and your earlier remarks.
View Pat Kelly Profile
CPC (AB)
That is understood. There is no private sector investment to displace, because you were in an area remote enough that a private sector operator could never profitably invest in a place. I wouldn't consider that displacing private investment, just because you've spent money there and not had it matched.
View Pat Kelly Profile
CPC (AB)
Fair enough. I understand that, but the Auditor General states in the report that they are concerned that the program was to avoid displacing private sector investment, and they're concerned that is a failure of the department, that the department—
View Kevin Sorenson Profile
CPC (AB)
I don't have any other questions, but I typically explain to our guests that, when we meet like this, we provide a report following it and I do as a result have a couple of questions that have been given to me by the analysts.
Before we get to those questions, I would that although this is a highly technical type of meeting that is televised, many Canadians may be watching it because they watch these types of programs—though their eyes may just glaze over. As Mr. Christopherson suggested, a majority of Canadians live in urban areas and say, “Connectivity problems, what problems? I can game, I can watch a movie, and I can do so many different things.”
However, the Auditor General's report explains the reason for this study, namely, that in 2016 about 96% of urban Canadians had access to broadband Internet speeds of 50 megabytes per second for downloading data and 10 megabytes per second for uploading data, but only 39% of Canadians living in rural and remote areas had access to those speeds.
I represent a riding that is not so much remote as very rural. Within my central Alberta riding, there are what we call the “special areas”, where I know that, when I get into those areas for meetings, I will just have to watch the phone trying to connect. This gap between urban and rural areas is part of why the Auditor General's office did this study, and out of the study, although there has been some improvement over the years, there are some troubling facts.
I should also say—and some of our analysts have worked on indigenous files before—that in paragraph 1.8 of its report, the Auditor General's office noted that “The Commission called broadband a 'transformative enabling technology' and concluded that any Canadian without broadband access is profoundly disadvantaged.” You know this, but I want the viewers watching to understand why this is so significant.
Governments have stated that we want to see improved health care for our indigenous people and those in remote and rural areas. We want to see specialized health, where they have access to specialized health. Part of the universal health care act says that universality, accessibility and reasonable access to common delivery are very important. Those are three of the five principles of the Canada Health Act. Well, specializing in health care in remote areas means that we need broadband, and that it has to be a priority.
I think all of us realize that it's going to be costly. It was costly originally to get a railway out to the far remote parts, but we said we had to do it. Consequently, this is what governments have said.
Health care, education.... If we're going to see indigenous and remote areas of the north, especially the eastern Arctic, improve their lot in life and have more opportunities, it's going to be through education. How do they do it? We do it through broadband, so that's why it's important.
If anyone is going to have a business in those special areas, in rural areas—so many home businesses are now starting up—they completely rely on being able to have the opportunities with this business because of broadband and access. This is part of the reason.
We have 15 minutes left, so pardon the rant.
Then we get into page 13 of the report, and we see, “Lack of transparency in the selection process”. This, to me, is one of the big problems, and we've talked about it today, the lack of transparency in selecting the processes for delivery.
View Kevin Sorenson Profile
CPC (AB)
Here's the problem for most Canadians, if they're watching.
Connect to innovate had $500 million available for allocation to successful applicants. The program received 892 applications, with funding requests for $4.4 billion. In some cases, there were multiple projects covering overlapping areas.
Here's the problem: “We found that the Department used a three-step process to evaluate applications. First, it screened the applications and assessed their merit.” That was the initial screening. “Second, officials from the Department and the Minister's office assessed funding options, each including a different mix for eligible projects.” Finally, in the third step, “the Minister provided conditional support approval on selected projects.” All of these areas—not so much area number one, but the other two areas—can be politicized and could be problematic. I'm not stating that it was a roadblock in any way, but certainly it can be viewed as one.
In paragraph 1.57, the Auditor General's office “found that there were a number of considerations to select projects”. The applications came in and “there were a number of considerations to select projects, but the application guide did not specify the relative weight of each criterion used in the project selection process.” The people applying didn't really understand the weight to each part of it. “Projects were less likely to be funded if they did not align with provincial and territorial priorities. However, these priorities were not made public. In our view, the Department should have made the weights and priorities public.”
Does the department agree with that?
View Kevin Sorenson Profile
CPC (AB)
All right. Thank you.
We go to the conclusion, as Mr. Christopherson and others have done, and we see again that “Canada did not develop and implement a national strategy to improve broadband Internet connectivity to a specific service level in rural and remote areas.”
Again, I represent one of those rural areas and it is problematic.
We have a question from our analyst that we can include in our report. This is regarding its responses to recommendation 1.60, that ISED “should inform stakeholders of the planned availability date, location, capacity, and price of the backbone to which they will have access” in a timely manner. How has the department advised successful project proponents that information on access pricing will be made publicly available in a timely manner as contribution agreements are signed?
Ms. Gravelle.
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