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Results: 2101 - 2195 of 2195
View Mike Sullivan Profile
NDP (ON)
View Mike Sullivan Profile
2011-11-16 16:05
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Thank you, Mr. Chair, and thank you, Mr. Webster.
One of the goals of a national public transit strategy is to take politics out of transit decision-making. I'm not sure whether you were around in the mid-nineties when we dug a hole in Eglinton Avenue and filled it in again. We're digging it again, this time with big boring machines.
Do you agree that having some kind of overarching strategy applied to transit decision-making to ensure that funding is transparent and not politically motivated would be a good thing?
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View Dany Morin Profile
NDP (QC)
View Dany Morin Profile
2011-11-16 17:12
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Thank you.
I have only five minutes and many questions. I ask that the witnesses keep their answers short. My first question is for Ms. Laurent.
In your presentation, you talked about home care. Based on your expertise, do you think that the next accord in 2014 between the federal government and the provinces should include the progress expected and the objectives concerning home care so as to hold the provinces accountable for investments and thereby move home care services forward?
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View John Williamson Profile
CPC (NB)
I will be quick and skip my preamble.
Dr. Turnbull, you said something earlier that was like a V-8 moment. You said that you'd like to move some beds out to save some money so that you could serve patients better.
All too often the solution to health care in this country is more money. We have the second most expensive system in the world. Some things we do very well; others we don't. How do we push innovation? How does the federal government ensure that the provinces and health authorities are making choices that ensure that dollars are spent wisely and are addressing some of these issues?
If you're waiting for a bureaucrat in Ottawa to push those beds out the door, I suspect you'll be waiting forever.
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Jeffrey Turnbull
View Jeffrey Turnbull Profile
Jeffrey Turnbull
2011-11-16 17:29
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I think we have a unique opportunity through the 2014 accord. There is an opportunity, when those transfers are committed, to ensure that they actually do have strings attached to them and that there's an accountability framework to ensure that meaningful change actually happens as a result of the transfers. I would argue that 2014 should be the beginning of a transformed health care system. Any investment we make in terms of transfers should come with accountability.
The accountability doesn't have to be from the province or territory to the federal government; it has to be from the province and territory to their citizens. We should insist that this innovation, this change that we're hoping will take place as a result of the transfers, be done in a transparent and accountable way and that it be based on national standards. I think it's a great opportunity.
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Alexander Wood
View Alexander Wood Profile
Alexander Wood
2011-11-03 10:58
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Thank you.
I'll just note that I saw Ms. Glover sticking out her finger, and I thought my presentation was so interesting, she wanted to jump right in with a question.
The point I was at, I guess, was to talk about the kinds of recommendations we would make for budget 2012. The first of those recommendations is that the budget should introduce into the discussion of Canada's economic context the framework of national capital. The idea here is to be able to report on how various forms of capital in our society—human, financial, built, or natural—contribute to our prosperity. As it's used in Norway, for example, the framework helps the government explain how the drawing down of its non-renewable natural capital, specifically oil, contributes to the building up of other forms of capital in Norwegian society and so lays the foundation for future prosperity. It's our belief that if the government were to use that kind of framework to communicate just how various forms of capital are being built up in Canadian society, it would greatly assist in the discussion of how Canada is doing in terms of its progress towards a green economy.
Our second recommendation is that the budget should contain a specific and structured focus on the green economy. The idea would be to provide a Government of Canada definition of what the green economy is, and how budget measures directly contribute to it with a clear statement of policy outcomes and objectives. The concrete first step would be to start reporting—again, probably in the discussion of Canada's economic situation—on Canada's greenhouse gas emissions or on other concrete indicators that right now StatsCan is in the business of tracking and reporting.
Our third and final recommendation would be for the budget to provide a greater discussion and explanation of instrument choice. Again, the point is not that the choices being made are the wrong ones; only that the absence of transparency that we note in the budget 2011 document on these kinds of choices makes them difficult to assess from an economic and environmental impact perspective. Our view is that greater transparency would increase overall confidence and buy-in for the budget measures.
That's my presentation. Thank you very much. I look forward to some questions and discussion.
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View Mike Sullivan Profile
NDP (ON)
View Mike Sullivan Profile
2011-11-02 16:03
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Thank you.
Thanks to all of you for being here.
You're aware that the nature of this bill that has been presented is to try to create a national strategy, a strategy that guides the formation of public transit at the local, regional, and inter-regional levels, but from a national perspective, because there's a significant amount of federal money in most large public transit projects. In addition, there is a gas tax that is headed off to municipalities, which is a significant amount of money, and essentially there may be more money in the future.
One of the things that the bill would attempt to do is to coordinate transit in a much better way than has been done. I think you're all too aware of what happens when there is political infighting over transit projects: we have a ditch dug on Eglinton Avenue that's filled in later in the mid-1990s, and also, part of your plan for light rail all over Toronto has now been axed by the recently elected mayor of the City of Toronto.
Part of what we've heard other witnesses say is that creating some transparency and some accountability in transit decisions would be a good thing. Do you agree that a national strategy would be helpful?
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Bruce McCuaig
View Bruce McCuaig Profile
Bruce McCuaig
2011-11-02 16:04
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Thanks for the question.
I think it's a really important point to look at the need for some national strategies for how we deal with our public transportation requirements in the nation. I would say that a principle-based approach for dealing with a national transit strategy is something that the committee should be thinking very clearly about.
It's important to have a broad-based consensus about the need for investment in public transit and to recognize nationally the importance of public transit to our economy and to our quality of life in our urban centres. It's really important to take a principle-based approach, without a national strategy getting into the details of local decision-making in terms of what makes sense in a particular regional or community context.
Here are some of the principles you might want to think about in the context of national transit strategies.
One would be about the need to be thinking in the long term. This might be something that you look to the local community or the regional transportation authority for in asking where is their long-term strategy or plan for the area.
Another is predictability in terms of an ongoing investment in transit and transportation. Flexibility for local choice is another one: in the end, this is all about giving residents in communities choice about how they move around the community. Another is accountability: it's really important to give the tools to local communities and regional authorities and then hold them accountable for delivering on the outcomes that they said they would deliver on.
Another principle is to have decisions made at the lowest possible level, because that's where you get the right match between the needs of the community and the nature of the projects and the investments. You've mentioned transparency in decision-making, and there should also be an evidence-based decision-making process so that you can demonstrate why you're making choices between different projects.
I think those are important principles, which we've been trying to apply in developing the Big Move in the greater Toronto and Hamilton area and in trying to implement it over the past few years. If we are studying a national transit strategy, I think those are elements that would be important for such a strategy.
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View Denis Coderre Profile
Lib. (QC)
View Denis Coderre Profile
2011-11-02 16:12
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Thank you very much.
I invite you to put on your headphones; we have to give the interpreters something to do.
Congratulations. I really enjoyed that, and not because I'm from Montreal and I don't know what's going on in Toronto.
I really enjoyed this. This is the real thing. This is exactly the kind of witness we need today for a future strategy.
What I'm wondering may be a neophyte's question. Obviously, our experience is different with the Société de transport de Montréal. Greater Montreal's political reality is certainly different from that of the agglomeration of Toronto and Hamilton.
I put the question to you out of curiosity. There are no politicians on your board of directors. In the end, did it turn out to be the only way, that is, excluding politicians from the process, because they were all promoting their own particular project, you could talk about such a large region as Toronto and Hamilton, and public transit? I'd like you to tell me about this.
Accountability is essential. Mayors get elected to represent a particular population. There are real needs with regard to public transit services. How do you explain the fact that there are no politicians involved in the process? How can you speak on behalf of a large region and establish priorities and make sure you're protecting people's sensitivities and take into account the needs of every part of the region?
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Bruce McCuaig
View Bruce McCuaig Profile
Bruce McCuaig
2011-11-02 16:14
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Thank you very much for the question.
That's a really important question, because we take our accountability to the public and to the municipalities very seriously. Fundamentally, we can't deliver on our objectives as a corporation unless we have a strong partnership with our municipalities and, in the end, with the public we're serving.
Metrolinx originally started with a board of directors that was largely comprised of municipal politicians. The mayors of many of the municipalities in the greater Toronto and Hamilton area were on the board, and they were very successful, in 2006 through to 2008, in coming up with a first for the greater Toronto and Hamilton area: a regional transportation plan. We have never had, in this region, a comprehensive plan that all the municipalities bought into. They were given the task to come up with a plan and they succeeded. We owe a huge debt of gratitude to the mayors and councillors who were on the board at that time.
The province took a look at how Metrolinx was going to evolve in the future and, first of all, merged it with GO Transit, an operating agency. They felt that it was time to switch from planned development to delivery of specific projects. They felt it was appropriate to bring in public-spirited citizens to help remove some of the tension around decision-making about which projects go first, second, third, and fourth, and to bring a very deliberate approach to how we build the infrastructure going forward.
That doesn't mean we conduct our work in secret. Our meetings are basically built into two elements. We have a public session, where the media and the public are fully engaged and hear about the work of Metrolinx, as everyone else does. Then we have a closed session, like any public agency tends to have to talk about contractual or commercial or property issues and things of that nature.
We've tried to maintain our accountability and we've tried to be true to the government objective of moving forward with delivery.
The other thing we were able to do when we brought in the public-minded citizens was to identify specific skill sets. We have a member of our board who is the leader at the Four Seasons Sheraton for customer service. Nick Mutton chairs our customer service committee and has been very successful in raising the level of customer satisfaction in our operating arm--
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Bruce McCuaig
View Bruce McCuaig Profile
Bruce McCuaig
2011-11-02 16:17
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Those are very good points. First of all, all of our planning work is done in public, so the public has a complete opportunity to participate, provide their input, and raise any concerns through the process. Those processes are ultimately approved under various environmental legislation. Sometimes that's federal. Sometimes that's provincial. Sometimes it's both.
As I said earlier on, it's impossible to deliver a project in a local municipality if you don't have the support of the local municipality. We have to work very closely, in context, with agencies like the Toronto Transit Commission and the City of Toronto to make sure that what we're doing on the Eglinton crosstown project, for example, is coincident with their local aspirations as well.
If we don't do that, we're going to fail on the delivery of the projects.
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View Andrew Cash Profile
NDP (ON)
View Andrew Cash Profile
2011-11-02 16:39
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Thank you for that.
As you probably know, there are more high-rise residential buildings--12 storeys and higher--being built in Toronto than in any other city in North America right now. Those people are going to have to move around, and yet, when you talk about coordinating the Big Move.... I mean, we had Transit City funded, but then it disappeared, and we have a crosstown line that's going to serve one-tenth of what Transit City would have served, and now we're going to have this massive influx of new people.
I've listened to you very carefully, and again, for some of the members on the other side who may have a rose-coloured view about the perfect system we have in the GTA, you know that this is very complicated and that there have been some difficulties.
But I wanted to talk about transparency. You talked about how, for a couple of years there, Metrolinx did some fantastic things and, coincidentally, elected officials were on the board at that time. Now, they were all punted off, and many of those elected officials had specific expertise in transit. I wonder if there is a correlation today between the loss of a comprehensive light rail system in Toronto and the fact that elected officials with transparency as part of their mandate are not on the board of Metrolinx.
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Bruce McCuaig
View Bruce McCuaig Profile
Bruce McCuaig
2011-11-02 16:40
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I don't see that correlation. What I see, in terms of some of the challenges we've had in continuing to deliver elements of the plan in the city of Toronto, was the election of a new mayor who has priorities that are different from those of the former mayor.
It doesn't matter, I don't think, whether the new mayor was or was not going to be on Metrolinx. I think we needed to be responsive to the community. I guess it's one of the challenges that all transportation agencies face across the country: you need to be responsive to the mandates of the individuals who get elected. That sometimes means that you have to look at adjustments to your plans in the short and the medium term.
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Bruce McCuaig
View Bruce McCuaig Profile
Bruce McCuaig
2011-11-02 16:54
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I don't see a particular need for the federal government to get into coming up with the plan for the region. That doesn't mean the federal government should not be involved in developing the plan for the region. When we developed the Big Move, we engaged with the federal government to get input from different departments and to make sure to identify and deal with any priorities of theirs.
Going back to my comments a few moments ago, rather than the federal government having a direct control over specific project elements of it, I would say that it's more along the lines of what the standards are. How are decisions to be taken? What is the accountability framework that we would expect? What are the outcomes that we're going to hold you accountable to report back to us on? Those are the kinds of things that I would say would be the role for the federal government.
I would also say that's an area where this study should be asking these very questions.
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View Denis Coderre Profile
Lib. (QC)
View Denis Coderre Profile
2011-11-02 17:21
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How do you manage to make sure there is no collusion? Do you have some specific process? Do you have an inspector-general or a comptroller? How does it work?
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Bruce McCuaig
View Bruce McCuaig Profile
Bruce McCuaig
2011-11-02 17:21
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We have a number of different mechanisms to exercise control and accountability. One is obviously the competitive nature of the marketplace in general, and we monitor very closely the number of bids we get in. We do our own estimates of the cost of the work before we put it out on the street, and we compare the tender prices against what the estimates were. If there is a variation--either over or under--we have a review of the basis for those variations.
In many cases, we have a fairness commissioner who is a part of the procurement process and independently does a report to us and to the board about the quality of the procurement we actually went through. We have internal auditors as well as external auditors who come in and give us a review on an ongoing basis. We also have the provincial Auditor General, who comes in and sees us on a periodic basis.
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View John Baird Profile
CPC (ON)
He said he wouldn't miss it, for the record.
He wishes Deepak was here; don't we all. Deepak is representing the Government of Canada at a very important meeting abroad.
The G-8 legacy fund helped an already beautiful part of Canada put its best face forward to the world. There were going to be literally 4,000 members of the media beaming pictures of this summit and the Muskoka region to every corner of the globe in blanket coverage. There were also thousands of delegates, thousands of diplomats, who would share their own impressions by word of mouth. Some stayed up to 100 kilometres away from the summit site. This was a huge opportunity. This was a huge undertaking.
Large international summits like this generally require significant infrastructure investments. Our government in February 2009 announced this fund to Canadians. Up to $50 million was available.
Ultimately, my office and departmental officials presented me with a list of public infrastructure projects that I approved. These 32 projects met the criteria of the program. These included the effective and secure hosting of the G-8, beautification of the region, and a lasting legacy for local communities.
As minister, I presented estimates to Parliament, and I am accountable for those estimates. When I arrived at the department, I was hearing concern from all sides that federal infrastructure approvals were taking far too long. They were mired in red tape. My mission was to get things moving, and, with this fund, time was of the essence.
The Building Canada fund was a seven-year program. Stimulus programs ran for two. With G-8 projects, though, we had approximately 15 months from start to finish.
Officials recommended, and I as minister accepted that advice, that we use an existing fund rather than create an entirely new one so that we could move quickly. The border infrastructure fund was topped up.
I am pleased to say that the 32 projects were delivered on time and millions under budget.
I would like to underline one point. I said the border infrastructure fund was an existing fund that was topped up. In other words, money that was designed for border infrastructure was not diverted from improvements to border security or mobility. It was merely a delivery mechanism.
The projects came in under budget, every penny was accounted for, and each of the projects continues to serve the public as it was intended. I'm told that this has been done in terms of parliamentary appropriations for more than 100 years.
I would also reiterate, Mr. Chair, the buck stops with me. The projects presented to me met all of the eligibility criteria for the program. I made the decisions, I am responsible, and I am accountable.
Let me also say that public servants at Infrastructure Canada did an absolutely outstanding job when the Canadian economy needed the federal government the most. They applied professional oversight and expertise to the thousands of project applications to help create jobs, hope, and opportunity at a time of global recession.
If our government had not acted to create more than 23,000 stimulus projects across the country, the great global recession may well have had great depression effects.
The Auditor General in her report made a number of observations about ways to be more open and more accountable to Canadians. I fully accept those comments, and the government agrees.
In hindsight, the estimates could have included a line regarding the top-up of this fund. I stand by my decisions, which were informed by the best possible advice. I was and remain accountable.
I'm open to providing responses to questions over the areas with which I was responsible.
Thank you.
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View Charlie Angus Profile
NDP (ON)
View Charlie Angus Profile
2011-11-02 16:47
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No, sorry; I only have a few minutes left, Mr. Baird. I love talking to you, so I'll ask you a question tomorrow and you can follow up for me.
I have, I guess, a simple question, Mr. Clement. You tell us you've learned some lessons from this. You got your hands on $50 million of border infrastructure money. You blew it on projects like hockey arenas and summit centres. You told your mayors to keep their lines straight, let's not talk to the media until we get this story out.
What you said, when people started asking questions, was that, I'm sorry, the dog ate my homework, but I'll do better next time.
Mr. Clement, a simple question: why should Canadians trust you with the $250 billion that you're now in charge of? If you're learning your lessons on the fly like that, and having to rely on mayors to come up with your paper trail, what are you doing at Treasury Board?
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View Tony Clement Profile
CPC (ON)
I have a long public record of public involvement, both provincially and federally, Mr. Chair. You know that as well, in our former roles.
I believe my record is a good record. It's an untainted record. It's a record of probity and honesty. I try to do my job the best I can for the people who not only elected me, but for the people of Canada, and I will continue to do so in my new role as President of the Treasury Board.
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Kevin Page
View Kevin Page Profile
Kevin Page
2011-11-02 15:32
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Thank you, Chair.
By way of introduction, with me is Chris Matier, our senior economist, who provides us with our economic and fiscal analysis; Dr. Mostafa Askari, our assistant Parliamentary Budget Officer for economic and fiscal analysis; and Sahir Khan, our assistant Parliamentary Budget Officer for revenue and expenditure analysis.
Thank you.
Good afternoon, Mr. Chair, vice-chairs, and members of the committee.
Thank you for inviting me and my colleagues to speak to you about Canada's economic and fiscal outlook in the context of your consultation leading up to the 2012 budget.
Yesterday, as you know, PBO released a report examining the short- and medium-term outlook. On September 29, 2011, PBO released its 2011 Fiscal Sustainability Report, which examines Canada's fiscal structure from a longer-term perspective. The Parliament of Canada Act instructs the Parliamentary Budget Officer to provide independent analysis to the Senate and the House of Commons about the state of the nation's finances and trends in the national economy.
The PBO's objective is to provide you with analysis of the planning environment to support your debate about policy priorities and directions, and as members of the House of Commons, your power of the purse role in holding the government to account with respect to the prudent management of public finances.
In an effort to provide you with a rich planning environment, PBO provides you with an independent view on the economic and fiscal outlook in a fully transparent manner. In addition we provide you with analysis to support your work.
We provide you with analysis of how the economy is projected to perform relative to potential output—the size of the so-called output gap.
We provide you with analysis on the nature of our fiscal balances—what proportion of our federal deficit is cyclical and will go away when our economy returns to its potential level, and what proportion is structural.
We provide analysis on uncertainty—what does the history of private sector economic projections relative to outcomes mean for confidence intervals around projections for nominal GDP and budgetary balances.
Finally, we do not lose sight of the long term. We provide you with estimates of the fiscal gap to inform you on the sustainability of current fiscal structures and the size of actions required to stabilize debt relative to the size of the economy in light of aging demographics and other underlying long-term cost pressures.
In the budget plan tabled in June 2011, the government committed to balancing the budget by 2014-2015 through reductions in expenses that will be determined and implemented in Budget 2012. This budget must also set up the framework for negotiations with the provinces and territories to be held in 2014 on federal transfers, which represent 30% of federal program spending.
I wish to highlight three challenges in the context of your deliberations on priorities and policy directions leading up to the 2012 budget.
One, relative to the 2011 budget planning framework, the outlook is weaker. Two, the fiscal outlook over the medium term is highly uncertain. Three, the challenges of long-term fiscal sustainability stemming from aging demographics and other cost pressures are real and need to be recognized and addressed.
The outlook for the Canadian economy has weakened in the eyes of virtually all forecasters, reflecting a less optimistic external environment. The negative impacts of de-leveraging, fiscal austerity, and declining confidence underscored by financial market turbulence are largely behind the softening of growth projections.
PBO projects Canadian real GDP to grow by 2.2% and 1.5% in 2011 and 2012 respectively. The weakness in near-term growth pushes the economy further below its productive capacity--a widening of the output gap--resulting in an increase in the unemployment rate. As a result, PBO expects the Bank of Canada to maintain the overnight rate target at 1% through the third quarter of 2013 before gradually raising rates over the remainder of the projection period.
Underlying the outlook is the assumption that the European sovereign debt crisis will be contained and the U.S. fiscal restructuring will take place in an orderly fashion. PBO is projecting a weaker short-term outlook than the average private sector outlook. PBO judges that the balance of risks to the private sector outlook for nominal GDP is tilted to the downside, reflecting a more sluggish near-term U.S. recovery, with real GDP growth of 1.6% versus 2% in 2012 for the average private sector forecast; a larger impact from the recent decline in commodity prices--we have GDP inflation in our forecast of 1.1% versus 2% in 2012 in the average private sector forecast; and the high level of Canadian household indebtedness that will likely restrain growth by a larger amount in the near term than appears to be factored into the average private sector forecast.
The PBO outlook for the budgetary balance on a status quo basis has the deficit declining from $37.3 billion in 2011-12, which is roughly 2.2% of GDP, to $30.5 billion in 2012-13, or 1.7% of GDP, and eventually to $7.3 billion in 2016-17, or 0.3% of GDP. These magnitudes remain significantly better than the projected outlooks of other G-7 countries and are consistent with targets set out by the G-20 in Toronto in 2010 for deficit reduction. The progress reflects reduction in both cyclical and structural balances over the medium term. The significant reduction in the structural deficit partly reflects the planned restraint in direct program spending.
Over the 2011-12 to 2016-17 period, PBO is assuming that direct program expenditure will grow modestly at 1.6% annually on average, which is significantly slower than observed over the five years preceding the downturn of 6.1%. Over the long term, PBO is projecting the structural deficit to rise on a status quo basis due to the impact of aging demographics and other underlying cost pressures.
PBO's 2011 fiscal sustainability report concluded that Canada does not have a fiscal structure at the federal and/or provincial-territorial government levels that will stabilize the debt-to-GDP ratio over the long term. We are undergoing a major demographic transition that will slow economic and government revenue growth and put upward pressure on spending. PBO estimates that restoring sustainability would require permanent policy actions to improve the operating balance amounting to 2.7% of GDP. That is 1.5% at the provincial-territorial level and 1.2% at the federal level.
While the amount of policy action is significantly less than the restraint measures implemented in the 1990s, it will need to be sustained over the longer term. These actions do not need to be taken immediately while the economy is operating below its full capacity; however, long delays in taking action would increase the amount of corrective measures significantly.
The challenges of the planning environment raise important considerations for parliamentarians regarding Canada's fiscal policy directions, targets, credibility, and sustainability.
Parliamentarians may wish to debate the policy merits of a staying the course fiscal policy reflecting the weaker outlook. Projected output losses in Canada relative to potential associated with the ongoing world financial crisis are more severe relative to the economic downturns in the mid-1990s and early 1980s. The output gap is now projected to close in 2017.
Given economic uncertainty based on accuracy of the average private sector forecast over the past 16 years, PBO analysis on balanced budget outcomes indicates the probability of fiscal balance under status quo policies is approximately 10% in 2014-15 and 25% in 2015-16.
In the context of a relatively large and persistent output gap over the medium term, uncertainty about the fiscal outlook over the medium term, and emerging fiscal pressures over the longer term, parliamentarians may wish to debate the pros and cons of further stimulus or restraint measures as well as the achievability, relative merits, and priority trade-offs associated with a fiscal target of budgetary balance in 2014-15.
While many other countries are experiencing market pressure to strengthen their medium-term fiscal plans, parliamentarians may wish to use Canada's better fiscal standing to reinforce the credibility of its medium- and longer-term fiscal plan.
A former Deputy Minister of Finance, Scott Clark, has recently written a paper highlighting four criteria for credible fiscal policy. Credible fiscal policy, he says, must be realistic, responsible, prudent, and transparent. According to Mr. Clark, credible fiscal policy should be based on a balanced view of challenges, prospects, and risks, and not be based on a rosy or unrealistic view. For example, a recent international paper by economist Jeffrey Frankel, published by the National Bureau of Economic Research, has highlighted the tendency across countries to use overly optimistic forecasts. This has facilitated complacency and contributed to tax cuts and increases in government spending.
From this perspective, the projections underlying Budget 2011 are no longer realistic. Parliamentarians may wish to consider whether the recently updated average private sector forecast represents a realistic view or they may recommend that the Department of Finance provide an independent economic outlook.
Responsible fiscal policy means the government will establish a medium- and long-term fiscal plan that is sustainable, whereby debt will not grow faster than the economy. Parliamentarians may wish to request that the government provide longer-term fiscal sustainability analysis, as promised in 2007.
Prudent fiscal policy means the government may wish to provision against forecast error and missed fiscal targets due to unforeseen events. Given high levels of uncertainty, parliamentarians may wish to debate the merits of contingency reserves and prudence allowances around the establishment of medium- and long-term fiscal targets.
Finally, transparent fiscal policy means full disclosure of analysis, information, and risks. Parliamentarians may wish to ensure full disclosure of the measures covered by the strategic and operating review to be implemented in Budget 2012, as well as in the annual reports on plans and priorities, with the same level of detail afforded in the 2009 fiscal stimulus plan.
Similarly, parliamentarians may wish to request that the government provide full disclosure of departmental plans associated with Budget 2010 operational restraint measures and the adjustments to the fiscal planning framework associated with the government's crime agenda.
Thank you for the opportunity to speak to you today.
We look forward to your questions.
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View Scott Brison Profile
Lib. (NS)
View Scott Brison Profile
2011-11-02 16:54
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In your report today you've provided some advice to Parliament and to parliamentarians. You say:
Transparent fiscal policy means full disclosure of analysis, information and risks. Parliamentarians may wish to ensure full disclosure of the measures covered by the Strategic and Operating Review to be implemented in Budget 2012.
You also say:
...parliamentarians may wish to request that the Government provide full disclosure of departmental plans associated with Budget 2010 operational restraint measures....
Are you saying that that information has yet to be provided to Parliament?
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Kevin Page
View Kevin Page Profile
Kevin Page
2011-11-02 16:56
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With respect to the first measure, the strategic operating review, I guess in the context of pre-budget consultations and as advice in your pre-budget report, to get full disclosure would be very important. It's important for us, because as we project forward and we look at the amount of spending in the medium term and we look at these growth rates, it's very low. It's almost unprecedented to have sustained five-year projections of total program spending under 3% and direct program spending under 2% over a sustained period of time. We're going to be building in more additional restraint under that kind of context.
The more details we can see around it, the more we know what will be the impact in terms of fiscal risk and what will be the service level risk.
In terms of 2010 budgetary measures, we still don't know how departments are managing, particularly that third year. So we're getting information almost on an ex post basis.
In terms of the crime adjustment numbers--even the numbers the government has put ou--my office cannot go to a budget, either in Budget 2010 or 2011, and see basically what has been the adjustment in Minister Flaherty's fiscal framework for the additional expenditures for the tough-on-crime agenda, so to speak.
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View Joyce Bateman Profile
CPC (MB)
Thank you very much, Mr. Chairman.
Thank you so much for being here today and for giving us the opportunity to get to know you a little bit better, and for having given us purpose to study your CV, which in my view is very impressive. I'm a chartered accountant myself, and I really appreciate the comments you have made, and I truly appreciate that your value to the crown will be greater because you have worked on both sides of the equation. That's something we can be grateful for benefiting from.
I want to ask you some questions with an international focus. I'm very proud that we in Canada are so well regarded as a model, not only within the accounting profession, but when it comes to accountability in government. We have an incredibly open system. We allow the Auditor General to freely examine whatever he or she chooses to investigate and then to report publicly on those findings. Certainly we as government have improved things based on Auditor General findings in the past.
How do you see the role of the Auditor General—your role, je l'espère—in setting an example for other countries in the world in regard to that openness, that accountability piece?
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Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2011-10-31 16:38
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I believe that the Auditor General of Canada has very much established a leadership position over the last number of years under Ms. Fraser's leadership in terms of its reputation across the world for excellence in performance audits and excellence in financial audits. I think Canada also has a reputation for having very excellent accounting standards for governments, as established by the Public Sector Accounting Board.
So I don't think Canada takes a back seat to anybody, whether it be in terms of the quality of financial statements, the quality of accounting standards, or the quality of the audit work that is done. And I think it's very important for Canada to continue to deliver that message.
For me, as Auditor General, one of the most important parts of that is the recognition that we have an independent accounting standard-setter, that being the Public Sector Accounting Board, and it is absolutely imperative that each and every government comply with the accounting standards set by that board so that everyone has confidence that the financial statements are prepared appropriately and that auditors audit to that set of standards.
Again, I think Canada doesn't take a back seat to anybody and that the federal Auditor General's office very much has a leadership role to play.
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View Bryan Hayes Profile
CPC (ON)
View Bryan Hayes Profile
2011-10-31 17:26
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Thank you.
Auditors general should value accountability and strong fiscal management. And colleagues who have worked with you have applauded your expertise in deficit reduction and fiscal restraint. Others have praised the critical nature you apply to your work, as well as your honesty and thoroughness.
Can you share with us a couple of thoughts on what accountability and fiscal management mean to you?
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Michael Ferguson
View Michael Ferguson Profile
Michael Ferguson
2011-10-31 17:26
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One thing I would focus in on is that when I was auditor general I made the recommendation to the previous government that it needed to implement a long-term budget plan. It had made a commitment to get back to a balanced budget, but I felt it had issued some targets and hadn't issued a plan.
Stepping into the role of Deputy Minister of Finance, of course, now means I myself have to live with that recommendation. So we, in the New Brunswick government, are very much right now going through an exercise—and it's not just the Department of Finance, it's really being led out of the executive council office—to develop a long-term plan that is more than just saying here's what the targeted deficit numbers are. Rather, it's something that has more information behind it in terms of how we're going to get back to a balanced budget.
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Jim Ralston
View Jim Ralston Profile
Jim Ralston
2011-10-26 15:41
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Thank you, Mr. Chair and members of the committee. Thank you for the opportunity to speak to you about internal audit, and how we have strengthened it in recent years.
I have with me today Brian Aiken, Assistant Comptroller General, Internal Audit. I will make a brief statement, and we would then be pleased to answer any questions you may have.
The Office of the Comptroller General of Canada works to strengthen the stewardship of taxpayer dollars and government assets across the federal public service and thereby support the overall effectiveness of public administration in Canada. We are responsible for providing functional direction with respect to financial management, internal audit, investment planning, procurement, project management, and the management of real property and materiel across the federal government.
To focus on internal audit: it is the professional appraisal function that looks at management systems, processes and practices, and the reliability of information. As such, it provides deputy heads with information on how well government's risk management and control processes are working in their departments.
This allows deputy heads to: exercise oversight and control; manage risk in an informed manner; and give attention to areas that need improvement.
Mr. Chair, to support the government's accountability agenda, we implemented the Policy on Internal Audit in April 2006. This policy includes: the clear assignment of accountabilities and roles and responsibilities; improvement in the independence of internal audit through changes to reporting relationships; the inclusion of a majority of members from outside the government on audit committees; and the adoption of professional auditing standards and practices.
Thanks in large part to this policy, significant strides have been made in improving internal audit in the government. For example, we have considerably increased the focus of internal audit on areas of higher risk and significance, and we have increased the credibility and professionalism of the function through community development efforts championed by my office and supported by chief audit executives across the Government of Canada.
As a result, deputy heads have confidence in the independent assurance that internal audit gives them, and they are increasingly relying on it to support them in their role.
Five years after bringing in the policy, we did an evaluation of the implementation—and the results have been extremely positive. They demonstrate that the policy has helped to improve risk management, governance, internal control and the stewardship of resources in departments and agencies.
The Auditor General's audit of the economic action plan in the fall of 2010 praised the work of internal auditors in supporting the successful implementation of this major government initiative. Moreover, the Auditor General comments at length on the progress made in the government's internal auditing function in the 2011 June status report.
We thank the Auditor General for this report, and recognize the value it brings to the continuous improvement of the management and operations of the Government of Canada. Finally, the establishment of departmental audit committees has received attention from academic experts in public administration.
To conclude, we in the Office of the Comptroller General, together with the entire internal audit community, are proud of what has been accomplished, and we are delighted that our efforts have been recognized.
However, we continue to make further strides and welcome the recommendations of the Auditor General, the independent evaluators, and academics as possible directions for future improvements.
We would now welcome the committee's questions.
Thank you.
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View Andrew Saxton Profile
CPC (BC)
View Andrew Saxton Profile
2011-10-26 15:56
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Thank you.
Finally, have the improvements that you described in internal audits contributed, in your opinion, to more transparency and accountability in government?
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John Wiersema
View John Wiersema Profile
John Wiersema
2011-10-26 15:56
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Yes, Mr. Chairman. The improvements in internal audit have absolutely contributed to better accountability in government. I believe that deputy ministers are now well served, for the most part, where there are internal audit functions, and they are also well served by their departmental audit committees. So this is clearly a success story.
What I would say, though--and Mr. Ralston perhaps might have some comments in this regard--is that the entire internal audit community in the core federal public service comprises some 400 or 500 people, who I believe are now functioning well for the most part. There are always opportunities for improvement, but it's important to keep that in the context of a core public service with over a quarter of a million people involved. So this is an important function, but it's a relatively small function, and I believe it's largely functioning well.
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Gregory Thomas
View Gregory Thomas Profile
Gregory Thomas
2011-10-24 16:32
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Thank you, Mr. Chairman.
As the federal director of the Canadian Taxpayers Federation, I'm here representing 70,000 supporters from across Canada. We are Canada's largest and oldest taxpayer advocacy organization, proudly non-partisan, and funded solely by voluntary contributions from supporters. We've never accepted government funding of any kind—we never will—and we're not a charity.
As we discuss the concept of a national transportation strategy, it's important that we have some context. The government just reported a budget deficit for last year of $33.4 billion. It's interesting to note that revenues surged $18.5 billion from the year previous, a healthy rise of 8.5%, bringing the government to within $5 billion of the record revenues reached in 2007-08. Yet just three years prior, those record revenues were sufficient to throw off a surplus of nearly $10 billion, while in this past year the government ran a deficit of $33.4 billion, owing to surging annual expenses that shot to over $270 billion from $233 billion in the same time frame.
So to the extent that government revenue was sufficient last year to have generated a surplus if the minority Parliament had merely held the line on spending, we now have a spending problem, and a major spending problem at that.
In the context of four years of massive deficits that erased 10 years of progress in reducing Canada's federal debt, we approach the proposition of a national transit strategy with some trepidation. We note the enthusiasm of the Federation of Canadian Municipalities for such a strategy. In their brief, the FCM put forth the notion that they represent 90% of Canada's population and they argued for more money from Canadian taxpayers to fund municipal transit systems.
Look, we have sympathy for Canada's city governments. They have built the lion's share of Canada's roads, and for years they had to witness the federal government collecting a user fee for roads, in the form of a gasoline excise tax, while not spending any of the money on roads at all. So we do support the transfer of the gas tax to cities for road projects. We would rather that all the revenue from the gas tax be directed towards roads and bridge-building and maintenance and we'd rather that the municipalities and provinces collect the revenue, rather than delegating the job to the federal government and the Federation of Canadian Municipalities.
Let's be clear: the Government of Canada has no reason to collect an excise tax on gasoline, except for the obvious and disheartening reality that it can, so it does.
Of course, the Government of Canada has spent $5 billion on transit since 2006, including $1.1 billion in gas tax revenue that it rightfully ought to have invested in roads and bridges, not transit systems. Once the diversion of the gas tax into transit began, it failed to satisfy the demands of the FCM and city governments, which see only the insufficiency of the federal financing.
So let's not kid ourselves: the concept of a national transportation strategy, especially as set forth in the official opposition's proposed legislation, is nothing more than a money grab. The so-called legislation contains no strategy, only the proposal that the government convene a conference and gather a group of money-seekers together to draw up a list of demands and submit them to Parliament.
In case there's any confusion that this is something other than a naked cash grab, the province of Quebec is fully exempt from any strategic element of the strategy at all. The bill only provides that any element of strategy that would have an effect on Quebec's sovereign soil simply be monetized, turned into a federal cheque, and handed over to the National Assembly.
The relevant passage says, “Recognizing the unique nature of the jurisdiction of the Government of Quebec with regard to...transit”, and ends with the statement that Quebec shall “receive an unconditional payment of the full federal funding that would otherwise be paid within its territory under...” the title of the legislation--
An hon. member: [Inaudible--Editor]
Mr. Gregory Thomas: Yes, entitled “National Public Transit Strategy”, so--
An hon. member: [Inaudible--Editor]...Quebec?
Mr. Gregory Thomas: We have no quarrel with Quebec's jurisdiction over transit, but we don't submit that it's unique. We think that provinces have jurisdiction over transit. Perhaps if Parliament stopped collecting a heinous excise tax on gasoline, the provinces could go and tax it, fund away, and do what they like.
We were recently asked to comment on proposed tolls to finance the replacement of the Champlain Bridge in Montreal, in a radio interview, and the interviewer was shocked to hear that we enthusiastically support them. I had to point out that we're the Canadian Taxpayers Federation, not the Montreal bridge motorists federation, and we believe that those who use a service should pay for it.
So we put it to you that the FCM, collectively, have been proven to be bad managers of taxpayer dollars, and they should not be rewarded with more federal money for more municipal empire-building. We put it to you that voter turnouts in municipal elections are woefully low, way short of 90%, and that the municipal politicians are principally beholden to people on city payrolls who extract outsized pay packages, benefits, and pensions in exchange for their support, and also to people who buy land as far as possible from transit, schools, municipal infrastructure, and other amenities, and then proceed to build housing on it.
Here in Ottawa, you just need to look at last weekend's daily papers to see ads for new housing located nowhere near any transit.
City governments cheerfully approve these projects, extract massive development cost charges for parks, street lights, sidewalks, street trees, and then send their lobbyists to you to demand billions for elaborate transit systems to get all these newcomers to their distant jobs. The cities’ approach seems to be to fill pastures with two-car garages, and then demand federal assistance for ever wider roads and ever more elaborate transit systems to prevent their regional economies from collapsing into gridlock.
An hon. member: Tell us what you really think.
Voices: Oh, oh!
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View Denis Coderre Profile
Lib. (QC)
View Denis Coderre Profile
2011-10-24 16:48
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No, you're not correct, because the bridge is an investment not only for the local economy, but for all of eastern Canada.
You are making the Tea Party sound like herbal tea drinkers. Having been part of a government before, I know that it has to make investments. So taxes are supposed to be used for services. I agree with you on that.
In basic economics, infrastructure is what brings in investments. When there are investments, there is wealth and the wealth turns into services. But the government is not a company. It has to provide services, and not just in Montreal. There are also taxpayers in rural regions and they are entitled to those services. But if they have no transportation or infrastructure, we have a problem, Mr. Thomas.
I am a radical centrist. I try to find a balance between the two. Yesterday, Richard Martineau was on Tout le monde en parle, as you might have seen, Mr. Chair. He is not really a leftist and he said that, in order to get depth perception, you need a left eye and a right eye. I really liked that. So we need to figure out how to get some depth perception.
I agree with you on the issue of accountability. We have to find ways to be accountable so that the money is well spent. But are you telling us that we should not take care of public transit, that it is not our problem and that we should not have a national transit strategy? I don't agree with that, but I can respect your point of view.
Or are you saying that we should perhaps review how we invest our money in order to make sure that people get services? Not everyone has big houses and two vehicles. Some people don’t have that many resources, but they want to protect the environment. So they invest in public transit. What role do governments play in that?
Finally, did I hear correctly that you want to scrap the gas tax? If so, does that mean transferring taxation power to the provinces and municipalities so that they can do whatever they want with the money? Is that what you are telling us today? I am just trying to understand.
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View Jamie Nicholls Profile
NDP (QC)
I will get to the question.
Another thing on the strategy and planning of the government for infrastructure spending--and I will bring this to transit shortly--is that the CTF talked about the federal government putting up around 9,000 stimulus signs and said that it was part of the government's plan for taking credit for the orgy of stimulus spending.
This member costed it out and said that it cost, if you multiply it across the country and take into account installation costs, about $3.2 million for signage for taking credit.
Now, what we've been trying to do with this transit strategy bill is depoliticize the process so that we can all get on board and improve the economy of this country by finding ways to improve the productivity of our transit systems.
This is my question to you. I will ask you to tell me which of the following would be more likely to gain the support of the CTF membership, putting aside the fact that the members are mostly against public spending, and accepting that, contrary to your position, funding will be transferred to the provinces and those provinces will use the money for their public transit systems. Which of these two would be more likely to gain the support of your membership? Spending with an eye to political gain on pet projects that have questionable economic impact? Or spending on a strategy that irons out the kinks before any money is spent and aims to improve the accountability and funding mechanisms to, in short, eliminate waste in spending?
What I'm saying is that spending is probably going to happen. Wouldn't it be better to have a strategy ahead of time for that spending instead of doing it on a sort of ad hoc basis?
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View Brad Butt Profile
CPC (ON)
Thank you very much, Mr. Chair.
Thank you, Mr. Thomas, for being here.
I'm not quite sure if my NDP colleague who just spoke understood how Canada's economic action plan, the infrastructure stimulus program, worked, because it was actually the municipalities that recommended the projects they wanted funded. I know that in Mississauga there was a unanimous vote by the mayor and members of council as to which 122 projects would be funded in the city of Mississauga.
So when they talk about pet political projects, they weren't the federal government's pet political projects at all. It was municipalities, which understand the infrastructure on the street and what they need in their communities, that recommended to the provincial and federal governments what should be funded. Let's get the facts straight on how that program worked.
Do you support a federal role in funding infrastructure for capital costs, for operating costs, for both, or for neither? Where do you folks draw the line? I think you did indicate that some infrastructure should be funded at the federal level of government. Do you believe the federal government should fund ongoing operating costs for transit systems or just contribute toward capital costs?
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Gregory Thomas
View Gregory Thomas Profile
Gregory Thomas
2011-10-24 17:16
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We believe that as long as the feds continue to collect excise tax on motor fuels those revenues should only go to roads and bridges and transportation infrastructure, or else for sure it'll go into CUPE pay raises and half-million dollar salaries for city executives, and the rest of it will get siphoned off into the black hole which is city governance in this country.
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View Brad Butt Profile
CPC (ON)
I think there are some good examples. Certainly in the city of Mississauga I can use good examples, where the federal government has agreed to partner on a one-third, one-third, and one-third basis with the province and the municipality to do some things that I think all of our municipalities need.
But the good thing about it is that the federal government is not on the hook for all of it. We're a partner in one-third of it. Do you like that model of a third, a third, and a third so there's accountability? Everybody puts something into the pot. It's not just one level of government funding it all. You have three different levels of government, each responsible to see a project...each one getting to put their sign up by the project, so there's some accountability back to the public as to who funded it, how it was done, and if it was done on time.
The three levels of government are, in essence, forced to work together. Is that a good model for how we do public transit infrastructure funding in this country?
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Gregory Thomas
View Gregory Thomas Profile
Gregory Thomas
2011-10-24 17:19
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With this proviso: we don't think the federal government has any business taxing motor fuel.
We also think it's inherently dishonest to levy GST or a harmonized sales tax on motor fuel that includes all these excise taxes. You're taxing a tax and that's kind of a banana republic thing to do. It would be better to be straight up, as they've done in Quebec, where they're actually raising their tax rates and are no longer going to apply.... They're going to have a harmonized system.
We don't necessarily agree that you automatically assume that if the federal government stops levying excise taxes on motor fuels, every municipality and every province will immediately reinstate those taxes. But if the voters in Toronto want to have higher fuel taxes and more transit, and the voters in Red Deer want lower fuel taxes and less transit, those are decisions. Then you can decide to live in Toronto or in Red Deer, as the case may be.
We believe that's a better approach for all Canadians than trying to pretend that the federal government can meddle in transit matters.
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View David Christopherson Profile
NDP (ON)
Okay, that's your time, Mr. Aspin. Thank you.
Colleagues, I'll be leaving the chair shortly for another obligation, and the first vice-chair, Mr. Kramp, will assume the chair, so I only have one question and I'd like to insert it now if I can.
Mr. Wernick, in your opening comments you mentioned that you've been in this position 65 months and have been in front of this committee four times. You'll probably recall that I was here for every one of those months and every one of those hearings. You may also recall that the one thing that launched me more than anything else regarding the Auditor General's reports was when there had been previous audits with the same findings and the situation had become worse. And then we would look at the responses from the previous time and see that they were very similar to the ones we would get at the current time. Mr. Kramp and I have been through this a number of cycles.
My question to you is this, and I say it with the greatest respect, that you're the accounting officer and you're on the dime, sir. I accept that the problems are huge and that they're not all yours alone. But I do have to ask the question, sir. What difference is there now between the promises you're making today on behalf of the government versus the promises that have been made in the past that weren't kept? In other words, why should we believe the department today, given the track record on so many of these issues?
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Michael Wernick
View Michael Wernick Profile
Michael Wernick
2011-10-24 16:20
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Thank you for the question, Mr. Chair. Yes, I do remember a lot of the previous questions.
I think what I can tell you is that where there are specific recommendations and specific issues, we do follow through, and there I can point you to dashboards and progress reports. We meticulously follow through every audit finding, every OAG finding, and we do make progress. There's been progress on water, there's been progress on school construction, and there's been enormous progress on settlement of specific claims. I can go through a long list of accomplishments of the men and women in my department over the last five years.
I think the key message of the Auditor General's report, as I hear it—and they can speak for themselves—is that we have reached the limits of a lot of further progress with the tools we have, and that we have to get better tools if Parliament wants better results.
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View Earl Dreeshen Profile
CPC (AB)
View Earl Dreeshen Profile
2011-10-24 16:50
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I think that comes back to the impediments Mr. Wiersema was speaking of earlier. You talked about the clarity of service levels—so that's one aspect of it—and the legislative base that we discussed earlier and, of course, the appropriate funding mechanisms. Those are being addressed, but you still have to get down to the final part, which is to look at the service delivery and see what is going to take place there.
I wonder, Mr. Wiersema, if you have any comments on that, and also if we could maybe expand it somewhat into the reporting requirements of federal organizations so that people do have some idea of what is taking place with the money that is being spent.
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John Wiersema
View John Wiersema Profile
John Wiersema
2011-10-24 16:51
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Mr. Chairman, I do not have a great deal to add to what has already been said, except to say that I agree with the member. It's all four elements; it's the legislative base, the service levels or standards and the outcomes the government is trying to achieve, the funding mechanism, and the capacity of the first nations themselves to deliver it. All of those have to work together to advance the lot of first nations on reserves.
With respect to the reporting burden, I think you've heard Mr. Wernick talk a little bit about that. A lot of it is driven off the funding mechanisms the government has chosen to use, the contribution agreements. A lot of this reporting is required by these contribution agreements. As the government moves to multi-year funding and funding to a broader group of communities, the reporting requirements might be lessened, but I still think the core issue is, as Mr. Wernick has indicated, that the government is excessively dependent on contribution agreements as a vehicle for funding.
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View Earl Dreeshen Profile
CPC (AB)
View Earl Dreeshen Profile
2011-10-24 16:52
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Mr. Wernick, can you perhaps give us a little bit of an idea of what has been done to help streamline some of those reporting requirements?
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Michael Wernick
View Michael Wernick Profile
Michael Wernick
2011-10-24 16:52
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What I found about reporting requirements is that, if you mow the lawn, the grass comes back. There are all kinds of people asking for data. They can be Treasury Board analysts who want to know about something. There can be a flap in Parliament, with all due respect, about an issue like fire protection, and people want to know about it, and the only way to know is to go and ask for data from first nations about what's going on. We don't have a lot of other sources to use, other than the census, which only comes around every five years. Our way to get information on what's going on out there is often to ask for reports to be sent to us. Sometimes, if you send money, you attach reporting conditions and so on.
There's lots of pull for more data, more reports. You have to really lean against it and say, “What do you need it for? Who's going to read it? What are you going to do with it?” and create some checks and balances to stop that.
I have taken one of my very senior people with a lot of field experience and put him full time on the issue of reporting burden. I told him, “Don't mow the grass; tell me where the roots are; what can we do to stop this proliferation of reports?” We've gone deep into the plumbing of our data collection instruments and where this comes from. I think we are making a lot of headway on that and we've stopped the growth of reporting requirements and have started to prune things, asking whether anybody is going to read something and what they are going to do with it. We ask, would it make a difference, would it help parliamentarians, would it help Canadians understand what's going on here?
Over the next year for sure, I think we'll see a dramatic drop in the number of reports, but I concur entirely with the observation of Mr. Wiersema. That's great. It really takes some of the load off administrators in band governments, but it's because we have very few other ways to get information that we do so much of that.
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Susan Eng
View Susan Eng Profile
Susan Eng
2011-10-24 16:17
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Thank you very much. I could say all of the above; indeed, all of those points are extremely relevant.
We have talked with our membership. We are engaging with them all the time, and we do focus on the fact that lots of work has been done around the country in a patchwork. There are all kinds of pilot projects that are taking place, but what is needed is a comprehensive set of strategies that can only come with a national conversation.
The health accord presents the opportunity for the federal government to set aside money to actually fund these initiatives, but a condition of having that money transferred to the provinces is to set certain national standards, certain national priorities, and to ensure there's accountability for the money being spent. In observing and reviewing the work that has been done according to the existing accords, we find the accountability is lacking.
While there may be projects that are happening—we know a few of them are very promising—we're not certain the knowledge is being shared. A lot of good work and a lot of serious money has been spent, so I think the federal role, and there is definitely a federal role, is to set the large framework. The coordination, the strategy, the accountability is implicitly a federal role.
The provinces, of course, have to deliver. Even in the latest elections this fall, all of them addressed many of these issues in a patchwork. They all had pieces of the puzzle, but none of them had the whole. The single most important message for us is that there be an overall framework.
The second piece, and I want to re-emphasize this because it's important from the point of view of fiscal management, is home care was identified as the next essential service to respond to an impending challenge, which is valid all by itself. But we feel that it's also important because it has the opportunity of restructuring the health care budget for the future. We're worried about its sustainability. We're hearing arguments for private pay, etc., and yet we're not looking at restructuring our actual delivery of those health care dollars and using them more appropriately. The opportunity arises with home care and caregiver support to actually divert a massive amount of demand, and therefore the opportunity to also put our fiscal books in balance.
Those would be our major recommendations for the federal role.
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Joe Sardinha
View Joe Sardinha Profile
Joe Sardinha
2011-10-20 15:32
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Thank you very much for this opportunity. Through the miracle of modern technology we're able to participate in these consultations, something I would like to do in person, but unfortunately I'm still harvesting my apple crop here in B.C. It's a little bit late this year, so that has kept me at the farm.
In terms of science and innovation, I believe the right mix of investment in research will lead to innovation at the farm level, resulting in a more competitive and, more importantly, a profitable farm sector. We need to get it right. We also anticipate that the risk management tools we have today and are developing for the future would experience a decline in demand if we do get that basic research flowing correctly throughout the industry.
Research is a vital part of agriculture's unbroken record of improvement in quality and productivity. It is particularly important to Canada as a nation of exports with vast agricultural capacity. Canada has a stake in advancing farm productivity, with research as a key component.
Food security may not be an issue in Canada but it is an issue as food supplies tighten. In Canada we're looking more at the issue of rising food prices than food shortages. Comparing this to the Canadian agricultural sector, where the road of productivity is allowed to slide compared to other competing jurisdictions, we know that other world areas have higher yields than Canada, and we have to continue on the research and innovation front to maintain our competitiveness in that regard.
The value of inventions that are created in Canada can alone compensate for the investment in productivity enhancement. This is particularly important to the tree fruit industry in terms of variety development or the plant breeding programs we currently have. It's key to the innovation in the tree fruit sector.
I want to address a question that we developed here. It states, what are the interests of agricultural producers, especially tree fruit growers in research? Growers are most keenly interested in improvements to horticultural practices, for example, more efficient irrigation, more efficient pruning/thinning, picking, grading, and storage of produce, using automation and computer technology. As I've said, the development of new varieties that are suited to our northern climate is extremely important, as is more environmentally friendly pest control, which builds on successes of integrated and area-wide pest management, enabling producers to manage both current and emerging pest and disease issues. We are an importing nation and seem to be landing new insect and disease species on our shores on an ongoing basis.
What is the reality? We've seen with Growing Forward 1 that the delivery of research programs to high-value Canadian horticulture needs to be upgraded so that we are competitive and build value for Canadians.
The switch that established national research science clusters was well intentioned but poorly implemented. It took longer that expected to launch and the criteria and eligibility of research projects changed up to the final moment.
The Canadian Horticulture Council assumed the role of administrator of the edible horticultural science cluster and has done a commendable job in dealing with the many changes to the science initiative since its inception. Under the CHC's guidance, the Canadian apple industry, a very big part of which I am in, invested substantial effort in synthesizing provincial research priorities into national research priorities. The industry then worked to develop its top three project proposals, as did other commodity representatives of the CHC. Application deadlines were met, but the guidelines changed after the fact, and two of the industry's three proposals were turned down because they involved federal research employees at AAFC research centres—some of the criteria that was not spelled out from the outset of the industry developing its research priorities.
The process really undermines the industry's confidence in investing all this time and effort when projects are rejected for what we feel are new and inconsequential reasons.
Following that debacle, the CHC was informed just this past summer that additional unallocated funding existed for the horticultural science cluster. It was a last-minute scramble by all to submit new project proposals in a very short timeframe to take advantage of this additional funding that no one knew anything about prior to the government's announcement. The apple industry did submit for a new project, but this was done in a very ad hoc way and it didn't really follow the priority-setting process that we had used in identifying our previous three projects.
So was it the right project for our scarce resources? Perhaps not, but it certainly exposed some inadequacies in the funding process, and certainly all the changes we've been hit with in the cluster initiative have led to much confusion.
If agricultural associations are willing to commit their share of research investment, it's perhaps time that government programs are made more transparent at the outset, and certainly the science cluster initiative could have used more transparency and better program development because we saw far too many changes throughout the implementation of the program. We need less bureaucracy so as not to sideswipe industry’s efforts to capitalize on research that I believe will ultimately enhance the competitiveness and profitability of the agricultural sector.
We do have some Growing Forward 2 recommendations that we'd like to propose to your committee. The government has increased other types of agriculture and processing research at the expense of horticultural practices, often referred to as primary production research. We recommend ensuring the level of funding for research and horticultural practices be balanced with other research needs.
The government has let key research positions go unfilled when retirements occur or are imminent. In a round of consultations a few years ago, this was a high priority to resolve, yet no strategy is emerging, and the erosion of our science capacity continues.
For tree fruit, we recommend that a weed scientist, a post-harvest physiologist, and a plant breeder be hired to replace recently retired or soon to be retired scientists at the Pacific Agri-Food Research Centre in Summerland.
We recommend that advisory committees for research stations, composed of producers nominated by provincial commodity associations, be re-established, with meaningful input into business plans, including succession planning for researchers and adequate and balanced resources required for senior researchers and technical staff to ensure a balance between horticultural and other types of research.
Lastly, we recommend that the federal government provide incentives for consolidation of research. We believe that research can take on a more focused approach throughout research stations across Canada. We recommend that Agriculture Canada's research branch take strong measures to re-establish consolidation of research activities, such that we may not have a model where we're doing horticultural research at every station across Canada, but we will have what I believe will be centres of excellence for applied research that will deal with horticultural issues, grain, grains and oilseeds issues, and animal and livestock issues--so it is more targeted, much more efficient, and we can have the appropriate expertise placed at those positions.
I would like to thank you for this opportunity to present. I did want to speed it up, so if there are any questions, I would be more than willing to answer them.
Thank you.
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Nicholas Gazzard
View Nicholas Gazzard Profile
Nicholas Gazzard
2011-10-20 10:03
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Good morning.
I would like to preface my remarks by saying we recognize the need for fiscal prudence in the coming budget. We would also, along with others, though, caution the Minister of Finance to show some flexibility and keep a fiscal open mind, given the international economic uncertainty we face.
In that context, I want to address very quickly the three elements of our brief.
The first is the need, in our view, to continue to invest in Canada's cities. We have an opportunity here in Budget 2012 to renew the federal government's good track record on investment in infrastructure and housing. This is an opportunity for Canada right now in the face of global uncertainty to ready its cities and its urban infrastructure to be economically competitive in the future, to create what we would like to call “joined up cities”, where transportation, housing, and jobs all come together to create an environment that is conducive to economic productivity.
Part of that, of course, is housing. The government has a good record in investing in housing. Close to $400 million a year is going in through the affordable housing framework, which runs between now and 2014. But we would argue, given the housing need in this country, that more is needed.
A number of witnesses, both before and after my appearance, will argue for tax-side incentives to create affordable housing. We would agree with that, with one caveat: that the housing that is created retain long-term affordability. We have seen tax-incentive housing developed in the past, which has lost its affordability. We would argue that if the government is going to invest on the tax side to create opportunities for affordable housing, it needs some sort of guarantee of continued affordability for the long term.
One possible way to do that is to look at the low-income housing tax credit system in the United States. This was actually a Conservative platform in the 2007 federal election. We would argue that you should revisit that and consider carefully whether that might be a scheme that could work in Canada to create more affordable housing.
Our second thing today actually is not one that is going to cost you any money. I'm sure the Canadian Taxpayers Federation will be happy to hear that. The federal government is in the process of completing agreements with the provinces in the affordable housing framework. Part of those agreements is an accountability clause, which we actually argued strongly for leading up to the renewal of the affordable housing framework.
The accountability framework requires the provinces and territories to actually account for the money they are spending on housing to demonstrate how they are creating affordability on the one hand and reduction in housing need on the other. What we are asking the federal government to do is to hold the provinces' and territories' feet to the fire here to make sure that the accountability framework is robust and that the provinces and territories really do account for the housing reduction that is caused through spending federal housing money.
I'd like to dwell now on the third point, which I think is perhaps the most pressing for us. Over the next five or six years an enormous number of funding agreements for existing what we might call legacy social housing are going to come to an end. That housing is facing a very uncertain future. The question is going to be the affordability of that housing for the low-income residents. What is going to happen is that subsidy streams will expire at the same time as the mortgage commitments those housing projects have. The question is, will those two things cancel each other out, or will they face an uncertain future in terms of the affordability of this housing for the low-income households?
What we argue is that there is not enough going on, not enough being talked about, not enough being discussed around the future of this housing. Last week the president of the CMHC, Karen Kinsley, was in front of the HUMA committee and said broadly that much of this housing is going to be okay.
We take issue with that. We don't believe it's going to be okay. The requirement to reinvest in this housing, coupled with very high ongoing maintenance costs, means that the affordability of this housing for low-income families is very much in doubt, very much at risk. We are looking at up to 200,000 units of affordable housing in this country that may no longer be affordable to seniors, to other people with fixed incomes, and to people with disabilities, going forward.
Part of the legacy of our affordable housing program in this country is security of tenure for low-income households. That security of tenure is in danger of being lost unless the federal government takes a leadership role to address the shortfall that's going to occur once the subsidy streams come to an end.
We are urging the finance minister to press CMHC to release a long-awaited report on the future of this stock and to address the financial shortfall that's going to occur.
One thing we don't want to see in the face of a real scarcity of affordable housing is the loss of housing that is already on the ground and is currently affordable, but that affordability is no longer guaranteed in the future. So we're urging you to address that in a meaningful and organized way with your provincial and territorial partners.
Thank you.
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View Manon Perreault Profile
Ind. (QC)
View Manon Perreault Profile
2011-10-18 15:36
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Good afternoon, sir.
I just have one simple question. Unless I am mistaken, the federal government provides the funding, but the provinces have the power to legislate. Is there an accountability mechanism that goes along with the federal funding?
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Rob Walsh
View Rob Walsh Profile
Rob Walsh
2011-10-18 15:37
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Yes. It has to do with federal expenditures. The federal government could get involved in areas administered by the provinces through expenditures, but the areas are defined when it comes to legislative issues.
In addition, the federal government could spend money in the provinces on matters that, according to some, are not exactly in line with the federal government's legitimate objectives. Nevertheless, from time to time, the federal government does spend money in the provinces in areas that don't come under federal jurisdiction, as set out in the legislative regime.
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View Carol Hughes Profile
NDP (ON)
I want to continue down the line of what she's just asked. You've indicated that there are accountability mechanisms as part of the funding. Can you maybe just elaborate on what kind of accountability that is?
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Rob Walsh
View Rob Walsh Profile
Rob Walsh
2011-10-18 15:38
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It was any spending by the federal government. The accountability is a parliamentary one, of course, although the federal government might spend federal funds in areas of provincial legislative jurisdiction. Nonetheless, it has to have an appropriation from Parliament for the spending of any funds. There is that initial stage of the federal government having to get its funds from Parliament. Then at the end of the year it reports to Parliament on how it spent those funds. In terms of process, there's an accountability by the federal government to Parliament regarding its use of the funds that had been provided to it by Parliament.
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View Carol Hughes Profile
NDP (ON)
I'm just wondering if there is any time where accountability measures go over the line and infringe on provincial prerogative.
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Rob Walsh
View Rob Walsh Profile
Rob Walsh
2011-10-18 15:39
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I don't know that I understand how accountability measures as such could go over into provincial areas.
As you may know, there's been an ongoing debate for some years between the Province of Quebec and the federal government regarding spending by the federal government in that province. From time to time, if my memory serves me well, the view often expressed, or sometimes expressed, by the Quebec government is that you can spend that money in the other provinces, but in this province, just give us the money--don't you spend it; you give us the money and we'll see that it is appropriately used. Sometimes that is acceptable to the federal government, I suppose, and sometimes it's not.
The important consideration here is that the federal government is accountable to the Parliament of Canada, to the House of Commons in particular. It's not accountable to the provincial governments, but the actions of the federal government in areas of provincial legislative jurisdiction sometimes give rise to a debate between a province, or several provinces, and the federal government about the propriety of what the federal government is doing.
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Tim Shearman
View Tim Shearman Profile
Tim Shearman
2011-10-17 16:26
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There can always be more money. The question is where is it going to come from? In Canada we have to balance what comes in with what's important to Canadians. We poll Canadians all the time, and we know health care is always important, education is important, and transportation is important.
We think the money perhaps can be spent more intelligently through looking at some of the research that's being done out there in terms of making better use of the existing infrastructure and ensuring, as you point out, there's transparency. I think if Canadians see transparency in the process, they're going to be more likely to buy into it.
I think that's certainly what we would advocate. Transparency can come in the form of the various levels of government getting together with other stakeholders to discuss the best ways to spend those precious dollars.
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Jeff Walker
View Jeff Walker Profile
Jeff Walker
2011-10-17 16:27
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I'm going to echo what Tim said on this notion of transparency. We think in a lot of cases decisions are getting made. I think the stimulus spending money was spent in very specific ways because there was a very specific set of needs that needed to happen relatively immediately. You could call those political or you could say there was an economic need at a moment in time. To our mind, we'd love to see a few different criteria introduced to hopefully the next version of Building Canada, but at the end of the day I really agree with Tim on this one, that this notion of transparency around the rationale for decision-making can probably go a heck of a long way to assuaging some of those concerns or considerations. That's something that could be usefully done without being too prescriptive.
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Toby Sanger
View Toby Sanger Profile
Toby Sanger
2011-10-17 17:16
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One of the major sources of savings is simply the lower costs of financing through public procurement and financing--i.e., not P3s. Over the 30 or 40 years that these might be amortized those 100 or 200 basis points can be a really substantial amount. Unfortunately, a lot of the value-for-money studies that are done by provincial governments really obfuscate the information. They present just a few pages of information. It's really not transparent. Unfortunately, that lack of transparency about the costing is endemic to P3 projects as well, because the public just does not have access to that information, which is often protected by commercial confidentiality and thousands of pages of legal contracts.
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View   Profile
2011-10-17 17:17
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Thank you very much. That's a good question.
One of the things that CNA has been talking about is an accountability framework. We'd be glad to send more information to the committee.
First of all, I want to thank the federal government for the leadership it has influenced in health care, given our constitution and the difficulties that it raises. I'd like to be a bit provocative and talk about, or at least allude to, the example of the HST and the kinds of harmonization issues this has caused in various jurisdictions.
In terms of an accountability framework, it's the ability, then, to grant funds to our jurisdictions with the provision that they demonstrate, for example, how they have harmonized or integrated their multiple governance systems. So does home care have to be separate from acute care? Do there have to be separate entities providing those services? What kind of accountability can we demand in terms of accepting the funding that the federal government's provided to bring to bear?
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View Andrew Saxton Profile
CPC (BC)
View Andrew Saxton Profile
2011-10-17 16:36
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Thank you, Mr. Chair.
Thanks to our witnesses for being here today. Thank you also for your very detailed and informative presentations. It is reassuring to know that we have the necessary procedures and controls in place here in Canada.
My first two questions are for the Auditor General. Can you highlight for the committee what one thing stands out as the biggest improvement in the last five years in the overall fiscal reporting process by the Government of Canada?
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John Wiersema
View John Wiersema Profile
John Wiersema
2011-10-17 16:37
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I have frequently indicated to this committee, Mr. Chairman, that at the level of summary reporting to Parliament and to Canadians, I believe the Government of Canada is a world leader. I believe that is the case for a number of reasons.
First, the Government of Canada adopted full accrual accounting in its financial reporting in, I guess it was, early 2000. That was an important development.
Another reason, as Mr. Ralston has indicated, is that the government follows independently set accounting standards, the standards set by the Public Sector Accounting Board, in preparing those financial reports.
So one huge step forward was made with the introduction of full accrual accounting. And at the risk of having my name removed from Michelle's Christmas card list, we have frequently and constantly been encouraging government to take the next step of moving towards full accrual accounting in the budgeting and estimates and supply process. The government has indicated how that works. It starts with the Minister of Finance's budget, then goes to the estimates process, and ends up with the public accounts of Canada. Well, the start of the process, the budget, is full accrual accounting. The end of the process, the public accounts, is full accrual accounting. Everything in-between is a bit of a hodgepodge of cash accounting and modified cash accounting. So we'd like to see the benefits of full accrual accounting extended right throughout the supply process. That would be one major improvement.
The other improvement I would talk about—and I believe I have mentioned this previously, Mr. Chairman—is as a result of the introduction of the Federal Accountability Act. The requirement relating to accounting officers for the heads of organizations, I believe, was a significant step forward. That same legislation, as Mr. Ralston has indicated, also put in place the requirement for internal audit functions in government departments and the establishment of departmental audit committees with outside membership.
So those were some milestones in public financial administration that I think have significantly moved the yardsticks forward.
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View Andrew Saxton Profile
CPC (BC)
View Andrew Saxton Profile
2011-10-17 16:39
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Thank you.
Given those milestones—the introduction of the Federal Accountability Act, and other legislation—would you say that the government is more transparent today as a result than it was, say, six years ago, before the introduction of that legislation?
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John Wiersema
View John Wiersema Profile
John Wiersema
2011-10-17 16:40
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Yes, Mr. Chairman, the Government of Canada is quite transparent in its financial reporting. Yes.
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View Andrew Saxton Profile
CPC (BC)
View Andrew Saxton Profile
2011-10-17 16:40
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Thank you very much.
My next question is for the secretary. How did the Federal Accountability Act change the way your office works, and what improvements did it make to the overall operations of government, in your opinion?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2011-10-17 16:40
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Thank you.
John picked up on a couple of those elements. I would say one of the primary elements has been to codify in legislation the traditional approach, or an understood approach, to the role of accounting officers, the role of deputy heads of organizations, their responsibilities, their span of control, and management responsibilities. The FAA literally codified those things and put them in legislation.
The big change has allowed us, as I indicated in my remarks, to move away from prescription and from a secretariat directive having to go into the gory details and telling everybody exactly how they should be doing everything. That has been a big shift, because the responsibilities and accountabilities are now with the deputy heads of the organizations on a full range of elements. So we can look to principals, results-based approaches.
The other core elements were mentioned in regard to the departmental audit committees: internal audit executives and their functions within organizations; and the requirement to have chief financial officers, and the accreditation of those chief financial officers or senior financial officers within organizations. So it involves the whole rigour around financial management and financial management processes.
Finally, I would add the management accountability framework and the rigour of reporting requirements that have come about as a result of that. I would say the cumulative impact of that has been a significantly more rigorous and stronger management regime.
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View Daryl Kramp Profile
CPC (ON)
Thank you, Chair.
After spending over three years discussing accrual accounting and accrual implementation, I can assure both the chair and our guests here today that I will not be commenting any further at this meeting on that topic.
Voices: Oh, oh!
Mr. Daryl Kramp: But I am assured that we have a great set of checks and balances in this country. When we shop and compare around the world, as Mr. Wiersema has mentioned, I think we can be tremendously proud of our collective accomplishments as a nation, thanks in no small part to our tremendous staff and civil service, as well as our executive and administrative branches of government. So I thank you all for your work on this.
In public accounts, for a number of years now we've recognized the necessity of moving and implementing IT into our entire process. Of course, it's not without its problems. One of the concerns that has been registered to both me and others is that if we move away from the actual paper trail to electronic and virtual tabling, will we not lose transparency or accessibility?
Madame d'Auray?
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Michelle d'Auray
View Michelle d'Auray Profile
H.E. Michelle d'Auray
2011-10-17 16:49
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I actually believe it will be the opposite. A web-based approach allows for a greater degree of information and greater flexibility in the use or manipulation, in the good sense of the term, of the information and data. I think that is indeed where governments are increasingly going. The print versions, while interesting, also have limitations in their format and what you can do with the information, whereas an electronic version allows you to add, change, and update on a regular basis.
For example, as Jim and I mentioned, we did the quarterly financial reporting electronically on organizations' websites. It's easily updated. If we had to go to a printing cycle, the delays in producing this would far outweigh the timeliness of the production of the information. So going to an electronic format actually speeds up a lot of the process. We wouldn't have been able to meet the deadlines on a quarterly reporting basis if we had not gone electronically.
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View Gerry Byrne Profile
Lib. (NL)
Thanks very much, Mr. Chair.
Mr. Wiersema, you indicated that you have a strong desire to stay on after November 31. I detected that.
Voices: Oh, oh!
Hon. Gerry Byrne: I detected that.
Given that Parliament, both the House and Senate, has to review this and appoint someone accordingly before that date and that we have not yet had an official nominee, I'd welcome you back in December to the committee.
Voices: Oh, oh!
Hon. Gerry Byrne: I'd like to move to Mr. Matthews and Mr. Ralston. I want to talk a bit about the challenge function. You both talked a little in terms of examples, giving specific examples of how the system works, and you talked about the process.
One recent example that strikes me is the G-8 legacy fund. What should we as a committee know? Obviously things did not happen the way they were supposed to, and those who were in a position--I think almost a statutory authority position—to
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View Gerry Byrne Profile
Lib. (NL)
That's good. Thanks very much.
That's helpful because it allows us as a committee to be able to say that, maybe, the CFO would be someone who we might want to ask to appear before the committee. So thank you very kindly.
I want to talk to Mr. Wiersema about the importance of this committee. You place a lot of value in this committee. Every time you've appeared, every time you have spoken in public, you always talk about the importance of your relationship with Parliament, in particular the PACP. Convince me that this relationship is important. More importantly, convince Canadians. What value does the PACP offer in terms of transparency and accountability?
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John Wiersema
View John Wiersema Profile
John Wiersema
2011-10-17 17:08
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Mr. Chairman, at a strictly legal and technical level, we present our reports to the Speaker of the House of Commons, who tables them in the House of Commons, and those reports are referred to this committee by standing order. So right off the bat, this committee is our key point of interface with Parliament. As an agent of Parliament, we're hear to serve parliamentarians and we see this committee as the key point of interface for our work on behalf of all of Parliament.
The second reason this committee is so important to the work of the Office of the Auditor General is that it brings life to the work of the office by way of its hearings on our individual audit reports. This committee will select a sample of our reports to have hearings on and will call the Office of the Auditor General to explain our findings. One of the unique features of this committee's work that we find very effective is that at the same time, at the same hearing, it will call departmental officials to explain their position opposite the findings of the Office of the Auditor General. And this committee in the recent past has also been very effective in asking departments to prepare action plans. It asks them whether they agree with the Auditor General's findings recommendations, yes or no, and sometimes departments disagree. And that's okay. But if you do agree, what is your action plan for correcting those deficiencies?
I indicated that the key measure of our performance is the extent to which our findings, our recommendations, are actually implemented. It's through this committee that we get action plans and a basis for follow up and accountability.
It's also through this committee that we can communicate to all parliamentarians and Canadians about the work of the Office of the Auditor General or our audit findings. This committee will prepare its own reports to the House of Commons after a hearing, saying: we listened to the Auditor General and the department, and here's our take on what's happening and here's our recommendations to the government on the issues that were our subject.
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Howard Bernstein
View Howard Bernstein Profile
Howard Bernstein
2011-10-06 8:48
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Good morning, honourable members and Madam Chair. Thank you for inviting me to speak.
I want to start by making my position perfectly clear. In my opinion, the CBC/Radio-Canada has no right to block freedom of information requests that refer to the financial operations of their corporation. It seems obvious to me that when a corporation accepts millions of dollars from public finances, it is incumbent on them to be completely transparent on the use of those funds.
It is furthermore hypocritical for a corporation with a news operation that is a major user of data received from freedom of information requests, an entity that in fact complains bitterly when freedom of information requests are denied, to deny the same access they demand of others.
I do not agree with the CBC when they claim that releasing such information will put them at a competitive disadvantage. The idea seems ludicrous to me. Many people at CTV and Global, for example, once worked for CBC, and vice versa, many CBC employees once worked at CTV and Global. The idea is beyond silly that they don't know how the others work. The cross-pollination in Canadian broadcasting means that all the networks know how everyone else does their jobs and all the networks work and spend in similar ways.
The real reason CBC does not want to open their books is the fear that some of the mistakes and misspending that will ultimately be revealed will result in bad publicity and even ridicule from those who are determined to harm the public broadcaster.
I'm afraid this is a real fear. There have always been political and broadcast business opponents who have had no qualms about sticking it to the CBC by taking mistakes out of context and blowing up the importance of minor misspending. Today, the anti-CBC hysteria has reached epidemic proportions. The news on TV channels shows a prime example of people who show no compunction in using distorted data and widely exaggerated claims to discredit the CBC. Members of Parliament have also been known to attack the CBC without taking the time to understand what they are criticizing and the fairness of the complaints.
Putting all of that aside, I still believe the CBC has to open its books. If they don't like the way they are read or interpreted by others, it's their duty to explain to the public that pays them and not hide from them.
However—and it's a big however—I feel I must make another point that is tangential but pertinent to what we are doing here. It seems amazing to me that members of Parliament or any politician from any level of government would take CBC to task for stonewalling the public. Are there any institutions that attempt to bury their mistakes more than governments do?
One example is this, if you'd permit me. How long have Canadians, both private and in the media, been trying to find out how close to $1 billion was spent on the G-8 and G-20 meetings last summer? In question period we're witnesses to the spectacle of a minister refusing to answer questions on he spent the $50 million allocated to the summits.
The CBC's hypocrisy is matched and raised every day by federal, provincial, regional, and urban governments. My suspicion is that government secrecy is carried out for the very same purpose that our public broadcaster is hiding behind its excuses: If the opposition, the media, and the public were privy to the blunders and some of the misspending, it could be a source of tremendous embarrassment to the people who control the purse strings of the nation.
Yes, the CBC should open its books. I hope the courts force the issue and rule against the CBC.
It's also time for all Canadians to demand the same level of transparency from government that some members of Parliament are demanding from the CBC. When I worked for CBC, CTV, and Global, it was not uncommon to hear my colleagues talk about having to go to Washington to find out what was happening in Ottawa. Canadian government levels of secrecy are out of control and do not make a lot of sense when considering our economic, political, and strategic place in the world.
I believe one of the best ways to force the CBC and governments of Canada to clean up their acts would be to let the public know where the waste and the misspending occur. Once the people of Canada see the errors, those in power will be forced to fix their mistakes or be punished with the loss of their jobs or worse. Most Canadians understand that in corporations as large as the CBC and within political entities as large as the federal, provincial, and urban governments mistakes and errors in judgment will be made. Canadians are willing to forgive the ones who own up to their mistakes and quickly fix the problems. It is the cover-ups and the secrecy that inevitably turn a simple error into a scandal.
So let me sum up. Yes, the CBC should have to open its books. But it seems to me a little unseemly to have the pot calling the kettle black.
Thank you for hearing me out.
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View Gerry Byrne Profile
Lib. (NL)
Thank you very much.
It strikes me that increased comptrollership improvements to the internal audit functions were not able to pick these things up. In fairness, they were probably not designed to do that. Would you be able to inform the committee as to whether or not the government, in this act of contrition, noting its failures and shortcomings here, has communicated to you and your office any specific measure, standard, or procedure that it is now instituting across government to prevent this from happening again?
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John Wiersema
View John Wiersema Profile
John Wiersema
2011-10-05 16:13
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Mr. Chairman, I don't think this is a situation that requires more rules. I believe the rules are there. This office has taken the position in the past, and I absolutely support that position, that we don't need more rules. What we need is consistent application of the existing rules. I'm not waiting for the government to say it put a new rule and procedure into place, because I don't think it's necessary in this case.
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Helen Cutts
View Helen Cutts Profile
Helen Cutts
2011-10-05 15:32
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I am pleased to be here. My understanding is that as you embark on your work on the north, it would be useful for you to have a briefing on how environmental assessment works. My purpose is go to over a deck; I don't have any prepared remarks. I will review the deck, which explains the Canadian Environmental Assessment Act and how it works, and I'll be very happy to answer your questions.
Turning to slide one, you can see that environmental assessment has been in place in one way or another since 1974. It was a very thin cabinet directive at that time. It wasn't until 1995 that we brought the Canadian Environmental Assessment Act into force. Since then, we've had one round of parliamentary review, and we brought in amendments by 2003. We had a small round of amendments in July 2010. That was part of the jobs and economic growth package that came with the budget that year.
Before I get into slide three, I want to emphasize that environmental assessment is a planning tool. It's a way for the government to work with companies such that before a shovel goes into the ground there is a discussion of what the environmental impacts are and how to mitigate them. This is beneficial for proponents because they get to see early on what changes in design they might need to make or what adjustments to their strategy might be needed before they invest a great deal of money.
The act itself applies to federal authorities. It asks those federal authorities to carry out assessments. These are departments and agencies, typically. There are a number of limited conditions under which those authorities are asked to carry out an environmental assessment having to do with whether a decision is required from them on a project. If they are the project proponent or if that department or agency is offering some sort of financial assistance, then they need an environmental assessment--or if they are a source of land, or if they are a regulator.
The regulation is a very common one. A company that needs to get a permit related to fish would then go to DFO and would indicate that they believe they need an environmental assessment.
We have three types of environmental assessments. Those are screenings, comprehensive studies, and review panels. I'll briefly go over each of these three types.
Most of them are screenings; these are required for any project. Our act works such that any project requires an environmental assessment, and then we have a tier that says a subset of the projects we will name requires a more comprehensive approach. Those will need comprehensive studies.
The vast majority of our environmental assessments are screenings, about 6,000 a year. The responsible authority, the one with the decision to make, is the one that carries this out. We end up with 40 or 50 different agencies involved across the board. They make a decision about what type of opportunity they want to give for public participation, they determine whether to require a follow-up program of the proponent, they make the final decision, and they're also responsible for the implementation of the mitigation measures and follow-up.
Just as an aside, I'll explain what follow-up is. Follow-up means that somebody needs to verify that the particular mitigation measures that were set out in the environmental assessment are doing what they were expected to do. This is a little different from enforcement. If we felt there was some concern about the habitat and said the company needed to make an adjustment, needed to build a ditch to ensure that the water flow was in the right direction and beneficial to the fish or other habitat that use the stream, then you would want to make sure that building the ditch did indeed divert the water and create the level of water that you expected to be sufficient when you set out those plans.
A comprehensive study, as I mentioned, is a more intensive and generally thicker document that looks at environment assessment. It meets the same types of criteria as a screening, but it has a few additional elements; for example, it would be required that you look at alternative means of carrying out the project.
The agency to which I belong is responsible for most of the comprehensive studies. The only exceptions are the ones that involve the Nuclear Safety Commission or the National Energy Board.
With comprehensive studies, one thing that is different from screenings is that we have a participant funding program; therefore, if an aboriginal group or an environmental group or a citizen would like to participate in some way and needed some funding for some research or to collect the views of their members, they can apply to us for participant funding. That's an important element of our comprehensive study program.
At the end of a comprehensive study, it is the Minister of the Environment who has to make a decision, deciding whether or not there are significant adverse environmental effects from the project. That decision would be based on the project as modified; it would not be based on the original project but on the project as described in the comprehensive study, taking into account any design changes and any mitigation plans.
Though the Minister of the Environment has that responsibility, it would still be a particular department that would be responsible for ensuring that those mitigation measures were taken. Often, as I say, it might be the Department of Fisheries and Oceans because the issue at hand was an issue surrounding fish habitat, for example. The follow-up programs under a comprehensive study are mandatory.
The third way we do environmental assessments involves situations in which the Minister of the Environment appoints independent experts, who will do research, call upon witnesses, hold hearings, and make recommendations to the government. This is another case in which we offer participant funding. The role of the agency in this particular case is limited to being a secretariat for that panel.
In the end, the responsible authority, the one with the decision to make, makes the final decision, with the approval of the Governor in Council. Again, the responsible authority checks to make sure that the mitigation measures are undertaken and that follow-up is done to ensure that mitigation is working as planned.
The last element I would like to flag to you today is on federal-provincial cooperation. The environment is really a shared responsibility between the federal government and the provinces. Many of you will already know that the provinces have their own environmental assessment processes.
This situation has the potential to create overlap and duplication. It is difficult for proponents if they have to respond to two sets of requirements. What we try to do is work with the provinces to run a process that is as seamless as possible. In order to facilitate that process, we have bilateral agreements with a number of provinces that set out how we would run a particular project when we are working together.
When we get into these cooperative arrangements, it's usually the provinces that take the lead and we participate actively.
That is simply the nuts and bolts of the Canadian Environmental Assessment Act, and I'd be pleased to answer any of your questions.
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View Mike Allen Profile
CPC (NB)
View Mike Allen Profile
2011-10-05 15:47
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Can you comment on whether the major projects management office has helped the process in its early stages? Are you seeing a change in some of the duplication that might have been in the process before?
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Helen Cutts
View Helen Cutts Profile
Helen Cutts
2011-10-05 15:48
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I've been very impressed with what the major projects management office has been able to accomplish. They've helped set up project agreements with timelines. That's the first thing. We have a tracker that is available to the public so they can watch what is happening on any given project and what the key milestones are. I believe that when transparency is emphasized it puts the onus on public servants to ensure that things get done in an efficient way.
The major projects office has played a key role just by shining a light on the slower timelines we had five years ago and the more rapid ones we have right now. The major projects management office has also ensured that the integration among government departments is stronger, that there is less time spent trying to decide which is going to be the lead department, so the projects get going faster.
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Michael Hudson
View Michael Hudson Profile
Michael Hudson
2011-10-05 16:34
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I understand you wanted to have a brief presentation on the duty to consult as a legal duty. I will spend a few moments on that.
When everyone thinks of natural resources in this country, your mind will automatically go to aboriginal peoples and the connection they may have to those resources. That is not a surprising feature because the place of aboriginal people in Canada has been a defining feature of this country for over 500 years. Nearly from the beginning, consultation between the crown and aboriginal peoples has been a hallmark of that relationship. From the making of treaties in the 18th century, from the surrenders of traditional lands by treaty to the use of Indian lands under the Indian Act, and more recently on section 35 and the justifications for infringements on traditional harvesting rights, consultation has been a key tool for the crown to justify its actions.
It was not surprising about seven years ago that the Supreme Court of Canada, in a series of landmark decisions, articulated a legal duty to consult on the part of the crown in order to justify its decisions that could have adverse effects on aboriginal peoples. Those decisions were the Haida Nation decision, Mikisew Cree, and the Taku River. What they articulated was a duty on the part of crown decision-makers to be informed of the implications of their actions on aboriginal people and their interests before they make decisions. This, as I say, was not a totally unique or new development, but it raised the stakes considerably for decision-makers. At its heart was a desire by the courts to ensure those decisions were well-founded, well-justified, and respectful of that relationship.
In practical terms, there was a period of some time after the court articulated that legal duty when there was some uncertainty among regulators as to what exactly they had to do. On the one hand, you had some who were fearful that this meant a complete rewriting of the regulatory regime of Canada. On the other hand, there was an extreme of people who thought it meant nothing, that it would simply be one more factor that would really have no consequence. In reality, what the court was calling for was a meaningful consultation with aboriginal people where decision-makers would pause and take into account what the issues at stake were, what the adverse impacts could be of their decisions, and then to make accommodations before a final decision was made.
The government's response was articulated in 2007 with its action plan on how the duty would be integrated into decision-making across the government. Those interim consultation guidelines were updated earlier this year, in March 2011.
I would like to pause now to run through the major steps the courts apply in terms of how the duty to consult is defined and then fulfilled by government decision-makers. It is important to stress that this is a legal duty; this is not discretionary. That is not to say that it is an impediment to either decision-making or to efficient and timely decision-making. I have often said to clients that meaningful consultation doesn't need to be a process without a time limit or something that provides a veto to an aboriginal party. It is being able to justify to a third party—in this case, the courts—that you have made an honest, reasonable effort in light of the stakes for the aboriginal party and the risk of the adverse impact of your decision to factor that into your decision-making process.
There are three key elements that need to be considered: crown conduct, potential or established aboriginal treaty rights, and potential for adverse impacts.
As for crown conduct that could trigger the duty, there are literally tens of thousands of actions by government officials at the federal level that could theoretically have an impact on aboriginal people. But in reality what the court is looking for are those actions that will have a true impact. These include land disposals, for example, which could affect aboriginal interest in lands; regulatory activity, such as assessments, which could lead to approvals or permitting, which would permit activities that could have an adverse effect on the aboriginal people.
The second element is the potential or established aboriginal rights or treaty rights. Here again, it could be that an aboriginal group with an interest in a project or in the treatment of land or a resource will articulate its opposition to the project. So the regulator or the decision-maker inside the government has to ask themselves whether there is truly an interest at stake here that relates back to section 35 of the Constitution Act, protecting aboriginal and treaty rights, which in short are mostly the traditional harvesting rights that one would expect to see as centrepieces of aboriginal culture in the past and into the present. So that second element isn't simply that an aboriginal party has an interest but that the interest relates back to section 35 and traditional activities.
The third element is potential adverse impacts. Not every decision that is made is necessarily going to have an adverse impact on the interests of the aboriginal party, but many will. So, for example, a decision to permit the construction of a pipeline that would cross an area in which traditional activity such as harvesting of caribou takes place should cause the decision-maker to ask themselves whether this is a situation in which there is a duty to consult. Changes in regulations that could change land use would be another example, as would decisions about pollution that could affect flora or animal populations.
When you add up those three elements, though, a spectrum is created. Consultation is a very generic word. At one end of that spectrum there could be a relatively weak claim by an aboriginal group. Interest might not be particularly tied to a type of fish or a type of animal to be hunted or an activity on land. The average impact is going to be very weak as well and might simply be sharing information, posting information, or sending a mail-out.
At the other end of the spectrum there could be a very strong claim if, for example, a court had recognized an aboriginal title right to land and there was going to be a decision that would permit a very destructive activity on that land. One would expect there to be a strong, meaningful consultation process. It wouldn't be a veto, but there would be an expectation of accommodation measures that would be commensurate with the negative impact on the interest.
Thank you, Mr. Chair.
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View François Lapointe Profile
NDP (QC)
Mr. Hudson, you used very strong words, like meaningful, for example. So you are referring to significant, viable consultations. From what I gather from your remarks, that is an absolute priority.
What procedure do we use to work with aboriginal people and to ensure that the work has been significant and viable, as they perceive it? How, and when in the process, is that checked?
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Michael Hudson
View Michael Hudson Profile
Michael Hudson
2011-10-05 17:29
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That is an important point. We have to be able to convince a third party, a judge actually, that the process was viable and that the effort made to consult the aboriginal people was significant. That is not a veto. Working with aboriginal people is not in itself necessary to make the decision a good one. Another test is in play. It must be shown that the process was bona fide and that it allowed the proper decision to be made.
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Richard Dicerni
View Richard Dicerni Profile
Richard Dicerni
2011-09-28 15:33
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Thank you very much, Mr. Chairman, for inviting us to your first meeting.
I've been asked to do a bit of an overview of the department. I will start by noting my two colleagues: Simon has been with us for over a year now, and Kelly has been with us for two or three years.
I'd like to give a brief overview of what the department does and speak briefly about the industry portfolio, which encompasses the granting councils and so forth.
Now, first things first. We note on the first slide that we work with and support four ministers:
Mr. Paradis, who is the current minister; Mr. Goodyear, who is the Minister of State (Science and Technology) (Federal Economic Development Agency for Southern Ontario); Mr. Bernier, who is the Minister of State (Small Business and Tourism); and Mr. Clement, who has maintained his responsibilities for FedNor.
If you come and visit the department, you will see that, as public servants, we support the work of four ministers.
If you turn the page to Industry Canada's mandate, I'd like to focus on each of our mandates and then discuss with you some of the initiatives we are involved with in each.
The department in the portfolio seeks to achieve three overarching and interrelated objectives. First is to develop and administer sound marketplace policies and programs. Second is to foster and encourage a knowledge economy. Third is to support small, medium, and large business. Let me speak to each one of those.
In terms of the marketplace, it is important that all modern economies have sound, effective marketplace policies. People need to know what the rules are; people also need to know what the framework policies are. The department contributes in a number of ways to this. I'll give you a few examples. Within Industry Canada lies the Competition Bureau, which is very active in making the marketplace work. It is currently involved, for example, in reviewing the Maple Group's desire to acquire TMX. Recently it got involved in and sought to take remedial action against the Canadian Real Estate Association for anti-competitive rules that it thought the association was imposing on real estate agents. So the Competition Bureau is one framework policy program.
We also work with the Department of Canadian Heritage on a very important piece of legislation dealing with copyright. That's important framework legislation.
We also administer—and my colleague Simon is the lead on this—the Investment Canada Act to ensure that transactions which are subject to the act are of net benefit to the country.
Other offices within Industry Canada include the Canadian Intellectual Property Office, where we issue patents and trademarks; Measurement Canada; and Corporations Canada. So there is a whole series of small agencies whose purpose it is to make sure that marketplace programs and policies work to the benefit of Canadians, both consumers and businesses.
Second is the knowledge economy. In 2007 the government released its science and technology strategy on maximizing its investment in S and T for the benefit of all Canadians. The department is very directly involved in this, but also with partner organizations in the portfolio, which I'll speak about in a few minutes.
I'll give you a few examples of the initiatives that the department has taken to encourage and support the knowledge-based economy.
We managed the Knowledge Infrastructure Program. As part of the Economic Action Plan, within the department we spent $2 billion, which resulted in further spending of $3 billion for post-secondary institutions and the private sector. In total, $5 billion was invested to increase the quality of the infrastructure in colleges, CEGEPs and universities across the country. Some 500 projects have been supported through this program.
We also launched the Canada Excellence Research Chairs Program. With a third party, we designated 19 recipients around the world and invited them to come to Canada. They were granted chairs worth $10 million over seven years. I think that we found a fairly extraordinary class of individuals.
We have other programs, including the Centres of Excellence for Commercialization and Research. All of this is intended to support the knowledge-based economy.
Third is support for business. As I said, the department is involved in supporting small, medium, and large businesses. We work on a wide range of projects and initiatives. Obviously, the department was quite involved during the auto restructuring in working closely with the U.S. government, as well as with GM and Chrysler, to assist in their restructuring, which I think has turned out to be a good initiative.
We also work closely with the aerospace sector. We have a program that supports partnerships, which contributes to Canada punching above its weight in regard to civil aviation market share in international matters. This program has supported a number of initiatives across the country--Magellan in Winnipeg and Pratt & Whitney in Montreal--and I think it's an essential part of our tool kit to support the aerospace industry in order to always achieve higher degrees of productivity and innovation.
We also have programs in the department that support small-business financing, whereby we will insure some loans that are provided by financial institutions.
So that's it in a nutshell, and I say “in a nutshell” because I've appeared before some of you in the past to discuss certain specific programs, and this is a very brief overview of what the department does.
Let me briefly talk about some of the policy and legislative initiatives that we are working on presently.
On the digital economy strategy, including spectrum auctions, the department released last year a discussion paper about auctions pertaining to both the 700 megahertz and the 2,500 megahertz. The minister recently had further consultations. The assumption is that over the course of the next two or three months some fundamental orientation will be identified, so either later this year or early next year, some decisions around the spectrum should be made public.
Building the critical infrastructure is one of the major pillars of the digital economy strategy. Other pillars include enhancing skill sets and ensuring that there is a very solid statutory framework. I can refer in that respect to the spam bill that was passed. I can refer to the copyright bill, which will be, I believe, shortly reintroduced, and to our PIPEDA legislation. Those are important statutory pillars.
There's also another pillar that is related to improving ICT adoption. One of the key aspects that explains the difference in productivity between Canada and the United States is the lack of ICT adoption by small and medium-sized businesses. We are working with the Business Development Bank to enhance awareness among SMEs regarding the usefulness, from productivity and competitiveness perspectives, of higher ICT adoption.
Speaking of the BDC, we are also working on the BDC's legislative review. Every five to ten years, the BDC act must be reviewed, so we're in the process of looking at how well it has done over the last five to ten years and identifying possible enhancements to its legislative mandate to support more effectively Canadian SMEs and Canadian entrepreneurs.
The department is also working under Mr. Bernier's stewardship on a federal tourism strategy to bring together in a more focused manner the various elements that are in play at the federal level to support tourism.
Lastly, in terms of policy initiatives, I would note that the government asked Mr. Tom Jenkins, chairman of OpenText, to launch a panel on research and development last October. We expect him to be submitting his report in October of this year. This panel will focus on the expenditures of the federal government in support of R and D in order to make sure we have the right mix between tax expenditures and program expenditures.
Overall the government spends about $7 billion in this area; $3 billion or $4 billion of that is for tax expenditures, and the rest for a series of programs.
In terms of legislative initiatives, I mentioned copyright and PIPEDA. They are two of our major initiatives in regard to our digital economy strategy. I believe these pieces of legislation will be reintroduced shortly.
Let me say a word on the Industry Canada portfolio. I would draw your attention to pages four and five. If you look at those two together, it will be more productive.
I would now like to speak about Industry Canada's portfolio.
First, with regard to the obligation to be accountable, all these agencies and corporations are headed by executives or presidents whose position is at a level equal to that of the deputy ministers, meaning that they do not work for me; they are part of the Industry Canada portfolio. As deputy ministers, Simon and I have some duty to supervise what they do and how they do it. If things are not going well, that clarifies our interventions a little. Still, these organizations are independent entities. I am sure that these people would be pleased to meet with you and tell you about their activities.
Please allow me to give you an overview of these institutions.
The National Research Council, which has been around for 90 or 100 years, is focusing on two interventions: the IRAP, a very useful program for supporting SMEs and launching new businesses, and institutes across the country that aim to increase the commercialization and the participation of the private sector in certain targeted sectors.
We have two granting councils: the Natural Sciences and Engineering Research Council and the Social Sciences and Humanities Research Council. They support fundamental research in universities. In the case of the Natural Sciences and Engineering Research Council, we are talking about approximately $1.1 billion, and with the Social Sciences and Humanities Research Council, it's approximately $700 million. A large part of this is recouped by the Indirect Costs Program. The grants they are awarded equal about $300 million. As part of the Science and Technology Strategy, these are obviously important partners, given that they work with the universities and, increasingly, with colleges.
There is also the Canadian Space Agency, in Saint-Hubert, which aims to support space exploration and the space industry.
I spoke earlier about the Business Development Bank of Canada, in Montreal, which supports some 29,000 or 30,000 clients annually through loans. It played a significant role during the economic crisis by increasing the credit available to entrepreneurs to ensure that the money was circulating in the economy.
The portfolio also includes Statistics Canada, which has just completed the census and the National Household Survey. As you know, the census went well, and the participation rate was high at 98.1%, which is very good. I think that Statistics Canada will soon make public the results of the national survey.
There is also the Canadian Tourism Commission, located in Vancouver, and it promotes tourism.
I'll stop now.
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Suzanne Legault
View Suzanne Legault Profile
Suzanne Legault
2011-09-22 8:50
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Good morning, Mr. Chair. Thank you.
Good morning to all the members.
Good morning. I'm very pleased to appear before you today as the committee starts its work on access to information, privacy, and ethics in this 41st Parliament.
You will find in the package that was distributed to you a number of documents that provide more information about my mandate, the accomplishments and priorities of my office, as well as a report and action plan related to a recent audit of our investigative processes. My opening remarks, unfortunately, are not finished being translated, so we will bring them to the committee a little bit later this afternoon.
Clearly this committee plays a crucial role in holding the government to account. You're vested with the responsibility of ensuring that the Canadian government's transparency agenda fulfills Canadians' needs and expectations for timely disclosure of valuable public sector information. Indeed, timely access to public sector information drives democracy and citizen engagement.
In an era of highly developed and ever-evolving information in communication technologies, it is the fluidity of public sector information that is key to competitiveness and socio-economic growth. That being said, it's important to remember that not all government information should be disclosed. As the Supreme Court of Canada stated last year:
Access to information in the hands of public institutions can increase transparency in government, contribute to an informed public, and enhance an open and democratic society. Some information in the hands of those institutions is, however, entitled to protection in order to prevent the impairment of those very principles and promote good governance.
It's a very delicate balancing act.
One of my responsibilities as Information Commissioner of Canada is to ensure that this right balance is struck. My annual report, tabled in June 2011, highlights the activities of my office in this endeavour.
The core of my mandate is to investigate complaints under the Access to Information Act. I am proud to report that we completed more than 2,000 cases for a second consecutive year.
We reduced by 8% the average time needed to complete investigations, and we further decreased our inventory at year-end by 11%. This success is due to a combination of efficiency gains, agile case management and collaboration with institutions. Overall, we can count on institutions' collaboration in resolving issues and implementing recommendations.
However, to deal with more complicated problems of non-compliance, I issued last year seven reports of findings with formal recommendations to heads of institutions. After the reports had been issued, three of these cases were ultimately resolved and the recommendations implemented. The four remaining cases are now before the courts.
I bring forward or intervene in legal proceedings when important principles of access legislation must be defended or clarified. This is the case with proceedings involving the Canadian Broadcasting Corporation and Canada Post Corporation.
To maximize compliance with the act, we must address the root causes of widespread or recurrent issues that adversely impact the timeliness and quantity of information disclosed. I take a systemic approach to assessing and investigating institutions' compliance. My goal is always to provide institutions, central agencies, and Parliament a thorough, fact-based diagnostic with specific and tailored solutions to guide efforts for improvements.
Last year, we implemented year two of our three-year plan for report cards and systemic investigations. The exercise included the assessment of a group of crown corporations and agents of Parliament that had recently come under the act. We followed up with 13 institutions that had performed poorly in previous assessments. Based on the data collected, we also launched a systemic investigation into the sources of delays, particularly mandatory consultations.
We are also investigating allegations of interference with the access to information process at Public Works and Government Services Canada.
In the current context of fiscal restraint, all institutions must seek more efficient ways to serve Canadians. This is why, upon taking office, I undertook a strategic planning process with my staff and key stakeholders to determine priorities and chart a roadmap for the first years of my term.
This plan will help us achieve significant outcomes in three key areas: exemplary service delivery; a well-governed workplace of choice; and a leading access to information regime.
To provide exemplary service, we will continue to refine our case management strategies while developing a comprehensive talent management framework. In this endeavour, we will build on the results from the audit of our investigative processes.
Mr. Chair, that is what I did last year as part of our internal auditing, in the wake of the incidents within the Office of the Public Sector Integrity Commissioner.
I commissioned an audit of my investigative function at the OIC, and I made sure that the criteria that the OAG had used to do its audit of the Integrity Commissioner's office was incorporated into the audit we conducted.
This morning, as part of the documents before you, I've tabled the results of this audit, which basically show that our investigative function conforms with our legislation. It made some recommendations, which we plan to incorporate into our action plan this fall.
Mr. Chairman, you can count on my continued support and advice to foster a leading access regime. I applaud the Canadian government for its commitment in the Speech from the Throne to ensuring that citizens, the private sector, and other partners have improved access to the workings of government through open data, open information, and open dialogue.
Minister Clement has taken the helm of the open government initiative, which notably includes an open information component that promises to take access to information closer to the digital age. I also welcome Minister Baird's commitment this week to having Canada join the multinational open government partnership. We will follow these government initiatives with great interest. In my view, they are key to embedding a culture of openness in federal institutions.
However, an open government initiative and a commitment to transparency must include a willingness to improve the efficiency of our access to information regime. In this area much work remains to be done. As reflected in Treasury Board statistics, over the past ten years there has been a steady decline in the timeliness and disclosure of information by federal institutions.
Current needs and expectations of Canadians require that we reverse this declining trend in timeliness and disclosure. I've committed to using all the powers and tools at my disposal to influence this outcome, starting with effective and timely investigations of complaints.
Mr. Chair, next year will mark the 30th anniversary of the Access to Information Act. I submit that the way forward must include the review and modernization of the act to bring our regime up to par with the most progressive international models. In preparation for this event, I have started an in-depth review of international benchmarking of our legislation to be in a position to advise Parliament of necessary amendments to the act.
To provide information about our work, I will be hosting the International Conference of Information Commissioners, which will be held in Canada for the first time, in collaboration with the Canadian Bar Association from October 3 to 5.
This forum will provide an excellent opportunity for commissioners, practitioners and advocates to exchange ideas for the advancement of access to information principles.
I am very excited to host this important event here in Ottawa. I invite you all to join the discussions, as we have an agreement with the Canadian Bar Association to allow all the committee members to attend the conference and some of the presentations.
In closing, I would like to acknowledge the hard work and unwavering dedication of my staff, to whom I owe much of our accomplishments.
I urge this committee to continue to advocate for more open government, for more timely and greater access to information.
Mr. Chair, I am now ready to answer any questions the members may have.
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View Charlie Angus Profile
NDP (ON)
Thank you, Mr. Chair.
Thank you, Madame Legault, for being here. I was very heartened to listen to your discourse this morning, particularly your words in terms of the “crucial role” of defending the public interest, of ensuring accessibility and transparency: that it really is a cornerstone of accountable government. I want to commend your work as a commissioner in ensuring that there is accountability for the people of Canada, because without that accountability there is no ability to say that we are truly democratic.
I preface these remarks because this week we learned of a SLAPP suit that was brought against three civic organizations: Newspapers Canada, the Canadian Taxpayers Federation, and the B.C. Freedom of Information and Privacy Association, which asked our committee to look into the Access to Information Act and the possible failings of the information act after the RCMP failed to follow up on the case of Sébastien Togneri and his complicity in obstructing information requests. Now, I find this attempt to use legal SLAPP suits to tell citizens that they can't come to our committee, or to try to obstruct citizens from looking to a parliamentary committee to investigate something that's clearly a cornerstone of democracy, to be outrageous and a possible serious breach of our privilege as parliamentarians.
But I also want to comment on the fact that Mr. Togneri made a number of comments publicly about your work, wherein he accused you of “grandstanding” for the sake of publicity. He said he hoped that in the future your office will demonstrate a little bit of caution and understand the consequences of “grandstanding against a political staffer”. I mean, who is this guy? I have to ask you. These are serious allegations to make against someone in your position. What do you think of the kind of public attack Mr. Togneri has waged against your work and against the work of citizens' groups that are trying to get accountable government?
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View Tony Clement Profile
CPC (ON)
By staying focused on balancing the budget and reducing the debt, we aim to keep taxes low and promote long-term economic growth.
We want to ensure Canada continues to be a place where people invest their money and grow their businesses. We want to ensure Canada will offer Canadians opportunities to work and contribute to their communities. These are the objectives driving us. And despite the large injection of stimulus funding we made over the past two years, I am pleased to say we are on track to balancing the books by 2014-15, a year ahead of the plan outlined in March.
Our government's commitment to this goal is clear in the responsible spending plans set out in the 2011-12 main estimates and supplementary estimates (A). The main estimates currently total $250.8 billion in expenditures for operating and capital costs, transfer payments, and the public debt charge. This represents a reduction of $10.4 billion in planned spending from the 2010-11 main estimates.
Also in the main estimates, program and operating votes are down by about $720 million, or 1.5%, from the 2010-11 main estimates. This amount is accounted for mainly by the winding down of the infrastructure initiatives we had under the economic action plan. The reductions also include a $3.4-billion decrease in planned statutory spending on interest and other costs.
Also shown in the main estimates is a $1.1-billion decrease resulting from the implementation of the harmonized sales tax.
The 2011-12 main estimates are in line with decisions from budget 2010 and previous budgets. Budget 2010 outlined our three-point plan to balance the budget. The first part of that plan is the winding down of the stimulus. The second part includes a number of measures to ensure the government lives within its means.
These include a freeze on the operating budgets of departments, and many other measures to restrain the growth of spending. But they do allow for some flexibility to implement budget priorities, among other things, and to accommodate cost pressures related to essential services.
Essentially, we have taken the same approach to balancing the books as Canadian families have. They have looked at their expenses and set priorities. They expect their government to do the same, and that's what we have been doing to great effect.
The third part of our government's plan to balance the budget includes continuing the strategic reviews on all of our program spending. This process requires departments to assess whether programs are achieving their intended results, are effectively managed, and are appropriately aligned with the priorities of Canadians and with federal responsibilities.
In 2010, the last year of the first four years of strategic reviews, 13 organizations were involved. They identified savings of more than $500 million annually. Together with measures to restrain the growth of national defence spending, this first cycle of strategic reviews resulted in $11 billion in savings over seven years, and more than $2.8 billion in ongoing savings.
Eliminating the deficit will also require new actions planned in the most recent budget, including the strategic and operating review. This process will involve the efficiency and effectiveness of government operations and programs in order to ensure ongoing value for Canadians. We will put about $80 billion of direct program spending under the microscope. The goal is to find at least $4 billion in ongoing annual savings by 2014-15. Every organization will be asked to develop two scenarios: one representing a 5% reduction, and one representing a 10% reduction in their spending. Unlike strategic review, the spending base will include all operating expenditures, including wages, salaries, and professional service contracts, for example, as well as grants and contributions, capital, and payments to crown corporations. Indeed, about two-thirds of the review base is represented by operating expenses. With this approach, we are taking a page from the private sector, which regularly conducts operational reviews to find areas for cost savings and productivity gains.
This is the first time in 15 years the government has conducted a review of the scope, and we believe that challenging times like these can also be opportunities to look critically at the programs and services we provide, their relevance, and how best to deliver them.
Let me also take a moment to describe the highlights of supplementary estimates (A), both government-wide and TBS-specific. Supplementary estimates (A) are part of the normal parliamentary approval process to ensure that previously planned government initiatives receive the necessary funding to move forward.
Specifically, the government-wide Supplementary Estimates (A) support the request for Parliament's approval of $2 billion in expenditures in 19 organizations. This amount is within the spending level specified in Budget 2010. In the Treasury Board Secretariat Supplementary Estimates (A), we are seeking $1.3 billion. This amount results from the Secretariat's role in funding a cash-out of severance pay for public service employees. This is happening in accordance with the collective agreement for three occupational groups, signed on March 1.
All these measures are part of the government's larger commitment to the prudent management of taxpayer dollars.
Mr. Chair, I'm proud of the government's economic record and its plan to ensure Canada remains at the forefront of economic growth and job creation. These main estimates and supplementary estimates (A) show the government is on track to implement its freeze on operating budgets.
As I mentioned earlier, program and operating votes are down by about $720 million from the year before. Also, if you compare spending in the estimates tabled to date for 2011-12 to total spending put before Parliament for 2010-11, you actually see a $2.7 billion decrease, excluding transfer payments and public debt.
Mr. Chair, we are also committed to improving the accountability and transparency in reporting to Parliament, and have been so for some time. For example, there are changes to the format of the 2011-12 main estimates. Part I now includes the trend of the budgetary main estimates accounts for the last ten years. In part II, for each department and agency we have added a brief description of the mandate or purpose of the department and the department's explanation of the major reasons for a material change in requirements from the previous year.
This change to the format of the main estimates is on top of improvements we have made over the past decade to supplementary estimates documents. These include a listing and description of horizontal initiatives requesting funding through supplementary estimates, and that means initiatives involving two or more organizations; an expanded introduction that includes descriptions of the largest dollar-value items; and summaries of authorities by ministry.
In addition to my responsibilities as President of the Treasury Board, I am also the minister responsible for FedNor, the Government of Canada's economic development organization serving northern Ontario. It's a position I've held proudly since 2006. In this regard, I'm joined today by Industry Canada's assistant deputy minister for regional operations, Mitch Davies, and at the back, FedNor's director general, Aime Dimatteo, should be around here somewhere, I hope.
Since April 2006, FedNor has invested more than $263 million in over 1,240 projects to benefit northern Ontario's economy. Our goal is to ensure that these investments and projects are having a positive impact on the economy of northern Ontario communities.
I was pleased to see that budget 2011 included a further commitment to northern Ontario of $4 million over three years to establish a cyclotron laboratory in Thunder Bay. This investment, through FedNor, will help create medical isotopes for early detection of cancer cells. The Government of Canada is pleased to support the Thunder Bay Regional Research Institute as it continues to develop new leading-edge technologies and products in medical science and research that will benefit the world.
Starting this August, we'll be taking another step to improve accountability and transparency in reporting to Parliament. We will require federal departments and crown corporations to prepare quarterly financial reports and to make them public. This will allow each department to provide a window into its own financial situation on a quarterly basis and give parliamentarians and Canadians enhanced information on government spending. It will facilitate timely oversight by parliamentarians of government expenditures and it will complement other information currently provided by the government, such as departmental performance reports and the annual public accounts of Canada.
I’m joined by the Secretary of the Treasury Board, Michelle d’Auray, and by other officials here, Bill Matthews and Christine Walker, and I previously introduced Mitch. At this point we are certainly here to take your questions.
Thank you, Chair.
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View Tony Clement Profile
CPC (ON)
As I said two weeks ago, we thank the Auditor General for her 10 years of service to Canadians.
The first chapter contains a recommendation to the Treasury Board Secretariat to review the reporting practices so that Parliament is better informed of the total costs of interdepartmental measures.
In accordance with the Auditor General's recommendation, I asked my colleagues to review the government's reporting practices in order to establish greater clarity when it comes to the horizontal initiatives, for example.
It's important to understand that these procedures have been around for 99 years, I'm told. The roll-up procedure, for instance, that was used to report the G-8 legacy fund used a process that has been around for nearly a hundred years. That's not to excuse, but to inform you as to why a particular process was used at the time by the minister of infrastructure.
Minister Baird and I have concluded, quite rightly, that the Auditor General was correct, that this procedure in these kinds of circumstances does not meet our test, our high standards for being transparent to Parliament. The Auditor General has indicated that this was not a deliberate malicious act by myself or by Minister Baird, but there was room for improvement. We have taken that to heart and I have given, as I mentioned, instructions to the secretary that we will come up with a new procedure for similar situations so that there can be a greater transparency and accountability to Parliament.
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View Alexandre Boulerice Profile
NDP (QC)
Thank you very much.
You addressed the matter yourself. As for the G8 Infrastructure Fund, you said in the media that it had been developed from the innovation or creativity—if I remember correctly, it was in English—of six of the region's mayors. I really want to highlight the poetry of the expression.
Were the decisions really made in consultation with six mayors or only with the mayor of Huntsville, the director general of Deerhurst Resort?
Mr. Minister, can you tell us how many times you met and if you kept files, notes from those meetings, from those discussions you had and about the criteria you used to choose the 32 projects that were selected? If those notes exist, are you willing to submit them to this committee?
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View Tony Clement Profile
CPC (ON)
As the Auditor General said and wrote, every dollar was spent based on the priorities indicated by the municipalities, and we accounted for every amount spent.
That's an important aspect of this report. There has been no misallocation of funds. There has been no misappropriation of funds.
Having said that, as I said, there's no mystery here. When the G-8 fund was announced, there were quite a few.... I have 16 municipalities. North Bay also had their airport that needed some funding to be ready for the G-8 as we knew it at the time.
As a result of this process, there were over 242 projects that were arrived at to potentially be funded. I went to my mayors, not only the six. I went to all 16 municipalities. Six mayors were represented on a committee where we would convey information to them and they would convey information to us, but I went to all the mayors and said there was no way the Government of Canada would fund 242 projects and told them to get that out of their heads right then. I asked them to give us the best projects they had that conformed to the terms and conditions of the G-8 legacy fund. Those were the ones that we could at least consider for the fund.
So there's no mystery. I know MPs always consult with their mayors about which projects fit the terms and conditions of various infrastructure projects. So they said they agreed that 242 was too much and they suggested 32 or 33, which they conveyed to me, that conform to the terms and conditions that were set out by the Government of Canada. I conveyed them to the department and to the minister of infrastructure, Minister Bairdat the time, and that's how that process went.
The Auditor General has said that she would like to have seen more paperwork at the front end of that, and you know what? Looking back on it, I understand her concern. The good news for taxpayers is that at the middle and back end of this process there were contribution agreements signed. There were terms and conditions that were met and verified, and not a penny was spent in a way that was not consistent with the contribution agreements and the terms and conditions.
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View Andrew Saxton Profile
CPC (BC)
View Andrew Saxton Profile
2011-06-20 17:05
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Could you explain how the improvements in the main estimates have helped make those estimates more transparent for Canadians? Perhaps your officials could expand on that as well.
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View Tony Clement Profile
CPC (ON)
I can refer to my notes on that. Certainly we have added to the transparency in the reporting. We're always looking for ways to do so to a greater degree, and I'll certainly be reviewing that over the next little while as President of the Treasury Board.
That's all I can say in 30 seconds.
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View John McCallum Profile
Lib. (ON)
Thank you, Mr. Chair, and thank you to our witnesses for being here.
I want to first try to review the facts briefly with regard to this legacy fund in a way that I hope is fair.
It's my understanding that in terms of the expenditure of money hundreds of kilometres from the borders it was designed for, this was not done maliciously, but in hindsight you think it was probably inappropriate and won't happen again.
With regard to the way in which the projects were chosen, it was basically a group of mayors and yourself, with little or no oversight at the bureaucratic level. All the money was accounted for, but with hindsight I think you agree that perhaps there should be more paperwork and oversight.
Is that a fair summary?
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View Tony Clement Profile
CPC (ON)
Let me say a couple of things.
First of all, I think we've acknowledged that the Auditor General in this particular chapter made one and only one recommendation. Her recommendation was that in circumstances where you roll up funds into a larger fund and that decreases the transparency, don't do that. She has a very good point. I would say again for the record that this was a procedure that had been used by Liberal governments and by Conservative governments for 99 years in dealing with rolling up expenditures in certain larger funds, but I think in 2011 we have to do better than that. Just because it was done in 1912 doesn't mean we do it in 2011.
So, yes, I think we do have to change those things.
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View Alexandre Boulerice Profile
NDP (QC)
Mr. Minister, allow me to go back to the G8 Infrastructure Fund. In these brief comments I will be making, I have to ask you first why no senior public servants were involved with you in choosing the projects for approval.
It is difficult to feel that you acted responsibly in this matter since only elected officials were involved with you. There were no senior public servants, no one representing the State. If I am not mistaken, there are no notes. So you cannot provide us with any notes, any minutes. It is a kind of black hole. You made decisions, but there is no record at all of the discussions that you had among yourselves.
Why were there no officials, no senior public servants, with you when you met?
Then you say that money to be spent on sidewalks was actually spent on them. That is not a satisfactory answer simply because the money was supposed to be for easing traffic congestion on the border. No way was it for sidewalks 300 kilometres away from the border or for fixing a town clock! Why was $250,000 spent on signs for hiking trails, parks and facilities in Muskoka? How does that reduce traffic congestion on the border? Parliamentarians were hoodwinked over this; money was not spent where they approved it to be spent.
Why were senior officials nowhere to be found and why was money used for things that had nothing to do with the uses approved by Parliament?
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View Tony Clement Profile
CPC (ON)
You know, you're absolutely wrong, I must say. To suggest that money was diverted from the border infrastructure fund for the G-8 legacy fund is factually incorrect. It's just not true. The funding was allocated in the budget. It was put in the border infrastructure fund for the purposes of presentation to Parliament. That was a decision that was made by the minister of infrastructure at the time. He has indicated that he realizes, in retrospect, that was not the most transparent way, but the fact of the matter is everyone knew that there was a G-8 legacy fund because I kept announcing via press conferences and ground-breakings that the funds were being used.
So it's a bit precious to say that no one knew what was happening. Having said that, there was no diversion of money from the border infrastructure fund to Muskoka. That's just a falsehood, and I refuse to let it stand.
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View Alexandre Boulerice Profile
NDP (QC)
Yes, I can.
I was referring to vote 55, Voted Appropriations, whereas $83 million was allocated to the Border Infrastructure Fund to reduce congestion at the border. One realizes, indeed, that a part of this $83 million was used and injected into the G8 Infrastructure Fund. You talked about it a great deal in the media, but this was not authorized by parliamentarians themselves. You raised the question yourself earlier. We see that this amount was spent on certain facilities, in Muskoka in particular, in your riding.
I would like to know how you justify this transfer of funds that was not explicitly authorized.
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View Tony Clement Profile
CPC (ON)
Let me say first of all that it's really not my place to say, because I did not make that decision. That was made by the minister responsible for infrastructure. I think if the minister of the day responsible for infrastructure were here, Minister Baird would say--because it was his decision—that he received advice from officials that this was a procedure that had been used for 99 years in various types of activity of the government to roll up smaller funds into larger funds where it merited to do so, and he took that advice. He now says—and he agrees with the Auditor General, just as I do—that in circumstances like this it is better to be more fulsome in description than less. It has fallen upon my responsibility as President of the Treasury Board to have a government-wide edict on this and policy on this for the future.
So I take your point. You're asking me why I did that. I didn't do it. John Baird did it. He said he did it on the advice of officials because that was the way it was done for 99 years. Now we know that in 2011 we shouldn't do things the way they were done in 1912, and we will govern ourselves accordingly.
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View Mike Wallace Profile
CPC (ON)
View Mike Wallace Profile
2011-06-20 11:53
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As members of Parliament, we would never see.... Where would somebody find that? There's nowhere it's listed that these are the programs and this is what was funded.
This is at a fairly high level, so it's grouped together. There's no way for us to be able to figure that out, as members of Parliament, so that when you come here, I can question you about program A, B, or C. How is it doing? How is it evaluated? Does that exist anywhere for me to see?
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Glenda Yeates
View Glenda Yeates Profile
Glenda Yeates
2011-06-20 11:54
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We report to parliamentarians in a number of ways with our program activity architecture. We try to give parliamentarians a good sense that here are all of our programs and this is what we do. We do reports on plans and priorities. I think those would be some of the places. It doesn't reflect the budgeting mechanisms or the scrutiny mechanisms a government might put in place, but it gives parliamentarians, I think....
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View Mike Wallace Profile
CPC (ON)
View Mike Wallace Profile
2011-06-20 11:54
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Asking you back to discuss your plans and priorities document would be a good time for us to do that. Would that be correct?
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Glenda Yeates
View Glenda Yeates Profile
Glenda Yeates
2011-06-20 11:54
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I think that's certainly a possibility, but the committee may have other possibilities as well, Mr. Chair.
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View Pat Martin Profile
NDP (MB)
View Pat Martin Profile
2011-06-20 11:59
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If I might just say, some of the answers given today serve as a graphic illustration to the committee that we've got to find better ways to follow the money. Your answers are honest and they're forthright and fulsome, but really what you're saying is there's no way of telling. Looking at these books, comparing this set of mains to this set of mains, the public would never know really what's going on. As the oversight committee for estimates, it's really difficult.
Mike has made it his life's work to follow the money and try to compare. But to compare apples to apples, we should be able to review those books and be able to say at the end of the day, this department went up or that department went down. It's a very frustrating process. But it's no fault of your own. I appreciate your answers and we appreciate your being here today.
Peter, did you have a point you wanted to make?
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View Peter Julian Profile
NDP (BC)
Yes, thank you, Mr. Chair.
Just to follow up on that, it would be very helpful to have the supplementaries on those departmental supplementary funds for 2010-11. A cut is a cut, and if the amount is coming back, and we're talking about the same programs that we have in the estimates for 2011-12, it would be helpful for the committee to be able to compare apples to apples, as the chair said.
I also wanted to say to you, Mr. Chair, that you bring a lot of poise and dignity to this position.
Some hon. members: Oh, oh!
Mr. Peter Julian: I think a lot of other chairs on Parliament Hill could be well served—
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