Proceedings of the Standing Senate Committee on
National Finance
Issue 37 - Evidence
OTTAWA, Tuesday, June 15, 1999
The Standing Senate Committee on National Finance met this day at 5:40 p.m. to examine the Main Estimates laid before Parliament for the fiscal year ending March 31, 2000.
Senator Terry Stratton (Chairman) in the Chair.
[English]
The Chairman: This evening we have with us Huguette Labelle, President of the Canadian International Development Agency, and John Robinson, Vice-President of CIDA.
Welcome, and thank you for being here. Please proceed with your opening statement, if you have one, and then we will turn to questions.
Ms Huguette Labelle, President, Canadian International Development Agency: Thank you for your invitation to be here this afternoon. I should like to spend a few minutes dealing with some of the highlights of the brief you have already in front of you. I will be quick so that we can maximize the time for questions.
We want to give you the sense that, in terms of international cooperation, there has been progress over the last 30 years. What we see on television very often does not lead us to believe that, because we see the problem spots, we see the difficulties. We do not always see the positive things that have happened, the progress that has been made with regards to access to clean water, access to education, the number of people who are literate, the number of people who participate in the economic life of a society.
However, although there has been impressive progress, there are many also serious challenges.
[Translation]
We regularly see these challenges on television. There is still a very great disparity between men and women. Women have much less education and girls do not go to school as much as boys.
In many cases, women do the hardest work. These are known facts. Fetching water can sometimes mean walking 15 kilometres a day, which virtually amounts to a day's work.
Children are still dying in a very large number of developing countries. Very young children are used as labour. Many girls are also used for the sex trade starting at the age of five.
[English]
The biggest problem is the disparity that is growing between the rich and the poor. We still have 1.5 billion people living on less than a dollar a day. I have met many people around the world who live on something like $30 or $40 a year -- those are U.S. funds, so maybe one should rejoice. Furthermore, with television -- because sometimes there might be one television in a very poor rural community -- people are able to see how the other portion of the world lives. That creates even more problems, although the problem is not that by itself: the problem is that we have such a great gap.
Population increase is continuing and will probably continue until the year 2040, assuming that things remain about where they are, but who knows what scenarios might unfold. What we do know is that 95 per cent of the population growth, about 80 million people a year now, is from developing countries. We are putting more people into the world every day.
With respect to health, I will just touch on HIV, because we have been supporting the treatment and prevention of HIV, especially in Africa. A few years ago I visited a part of Zimbabwe. At that time, women's life expectancy there was 57 years. Within the next six years or so it will be down to 25 or 26 years. There are a lot of children now who do not have any parents or even older aunts or uncles because they are dead or very ill. It is not uncommon to have a little girl of eight in charge of a family with four or five younger children.
[Translation]
We have been hearing a lot of talk about the environment since Kyoto, and this sector is quite disturbing. The Western countries currently produce the most CO2, but, within a few years, half of the world's CO2 production will come from developing countries since they are industrializing to a much greater degree. In some cases, countries such as China burn soft coal, thus releasing numerous toxic substances into the air.
[English]
In our brief, we flag water as a concern, because we now have 25 countries that are deficient in water. It is anticipated by a group that did a major study two years ago that by 2025, about 66 countries will be water deficient. This is another major source of problems, because many waterways in the world are bordered by multiple countries. The Nile, the Mekong, the Zambezi River are a few examples of those waterways. The joint management of the waterways will be very important to prevent conflicts arising in the future because those water levels are low.
I will not expound on the topic of conflicts. We see them on television every day.
I will jump over page 16 of the brief, but this is just a reminder that Canada, through multiple summits, whether Beijing, Copenhagen or Cairo, made some commitments with all other countries that we should work together to try to change the situation of the poor and make a significant difference.
CIDA is the arm of the federal government that provides international cooperation in the world. Our mandate is basically to work on the reduction of poverty so that hopefully we can all have greater security and more prosperity to share for everyone. We are active on all continents, and we are also active multilaterally in supporting some of the special agencies of the UN, like UNICEF. We work with the international financial institutions who do significant concessional loans in the poorer countries of the world, and in Central and Eastern Europe as well, although the purpose of that program originally was more to establish links between Canadians and that part of the world as it opened up. However, with some of the problems that we have seen, it is turning out to be closer to a traditional development assistance program.
On page 20, we outline a number of program priorities: water, safety, nutrition, shelter. We have committed to spending 25 per cent of our official development assistance on those. CIDA has done a lot of work with women around the world. We have also helped with infrastructure services. That is a third priority. Increasingly we have been working in the area of human rights, democracy and good governance, helping countries to give themselves a system of law where they may not have had one or where they may have had a very weak one. We have been helping them to develop the laws that will permit them to receive investments. Hopefully, that will make a difference in the future. We are also helping them to develop their private sector and environment.
On page 21, we have provided a few examples so that these things come alive.
[Translation]
In the area of micronutrients, for example, we have done a lot of work with many countries where, in many instances, with half a cent, we can prevent a child from suffering mental impairment as a result of vitamin A deficiency. To cite another example, in many regions of the world, iodine deficiencies are not offset by the use of iodized salt, as is the case in Canada. These deficiencies are thus corrected through fortified foods, pending a solution to these problems. Otherwise, we see children with growth deficits that are never corrected by the time they reach adulthood.
[English]
I will not go over the other examples. We have brought them to you so that you can take them back with you, and maybe some of those will prompt questions for us individually or collectively that we can answer.
Basically, the Official Development Assistance, or ODA, program provides Canada with an opportunity to help others. Canadians have said that they believe we need to do that. That is the altruistic part. It also helps us as a source of influence around the table. As Canada has worked in many parts of the world, people know us and are very often more inclined to support on a multilateral basis some of the things that we feel are important. Of course, it is also a way of contributing to world security and to health. We have had cases of malaria in Canada that are indigenous. We have new forms of tuberculosis, and within 24 hours tuberculosis can travel pretty well around the globe.
There are many other aspects. One of them, of course, is that the ODA program contributes to our prosperity. We work with quite a few groups and individuals in Canada. Although our projects are to help communities in other countries, the return on that investment very often includes spin-offs wherein then a Canadian enterprise or university obtains a contract from the World Bank, for example, or there are commercial opportunities. We can see the fanning out of opportunities from many of our programs. Canadian enterprises and universities have become known to a country and have been able to demonstrate what Canadians can do in those situations. That is not the purpose of our program but it does happen constantly.
[Translation]
I would like to have a final word on the budget envelope. On page 29, you see how the distribution is done. There is the international envelope for cooperation, which embraces the service providers, including CIDA. We represent nearly 80 per cent of this envelope. The Department of Finance has a certain portion for the World Bank, the Department of Foreign Affairs and the International Development Research Centre, among other things.
On page 30, it is emphasized that CIDA has made a significant contribution to reducing the deficit in recent years. However, this has caused a significant decline in Canada's assistance budget, which compares to our GDP. In its last budget, however, the government indicated that growth would be starting next year. The following page is a restatement of what you have in Part III regarding the budget.
Senator Bolduc: The world's population is approximately six billion inhabitants, of whom approximately three billion live in Asia, one billion or a little less in the Americas, nearly one billion in Africa and the Middle East and, lastly, another billion in Europe as a whole. Half the world's population thus lives in Asia.
What strikes me in the bilateral budget and the geographical organization of this budget -- I am excluding multilateral assistance for the moment -- is that you have $167 million for South America, $90 million for the countries of Eastern Europe, $315 million for Africa and the Middle East and $253 million for Asia.
There are probably as many poor people in Asia as in Africa. You need only think of India, Pakistan, Sri Lanka and Indonesia, where populations are huge, not to mention China.
Apart from multilateral assistance, which is mainly immediate and humanitarian aid, you arrive at $250 million. I have trouble seeing the reasons behind this distribution. Since we are a trading nation, I understand that we have to deal throughout the world, and this moreover is one of CIDA's dilemmas. You help roughly 100 countries, whereas many people say that you should concentrate more on the 40 or 50 or so poorest countries.
Is there a justification for this geographical distribution? If the criterion is poverty, I have trouble understanding why you allocate $250 million to Asia and $167 million to Latin America. I am not saying this is a bad thing, but I imagine there must be other considerations that come into play than the poverty criterion. What do you have to say on this point?
Ms Labelle: Considering China and India alone, these two countries represent one-third of the world's population. We know perfectly well that, in a country such as China, things are going well in certain regions such as the southeast, but that in the centre and northwest, there are people who earn $50 or less each year. So there are many poor people in Asia, in Bangladesh and Pakistan, among other countries.
However, there are fewer countries in this region of the world. China, India, Pakistan and Bangladesh, where the poorest people live, are four countries which we call our "concentration countries": 70 per cent of our resources, of the aid program, apart from Eastern and Central Europe, goes to 25 countries. This is a different way of concentrating.
In Africa, we have to deal with the historical aspect and the fact that many of the poorest countries are there. You are right that 44 per cent of aid goes to Africa and 37 per cent to Asia. There are obviously many more poor people in Asia, and that is why these are the three most important countries.
In terms of balance, if we had additional resources, we would clearly be looking very closely at the regions you mentioned. We very often shift from one region to another or from one country to another. What we hoped, obviously, is that in countries such as Indonesia, for example, where we previously identified declining growth, we could do a reallocation within a certain number of years. Unfortunately, with the financial crisis, we have had to revise our positions on the subject. So you've raised a very important point. There are a lot of poor people in Asia, but people sometimes forget the fact.
[English]
Senator Bolduc: Why is CIDA not a statutory foundation? It was established by order in council. Is it because in international and foreign affairs in Canada, as in every parliamentary system based on the Westminster model, there is a tradition of executive leadership in foreign affairs, meaning that the Crown can do what she wishes? Is it that in foreign affairs there is a necessary discretion to weight in a different manner, over time, various programs? Or is it simply that they were very busy in the 1950s when they made that decision and since then there has been some governmental laziness? It is so practical not to have a law that governs your actions. As a civil servant I used to understand that very well.
Ms Labelle: I do not know about the laziness part. I was not there at the time. You will remember that the ODA office was in the Department of Foreign Affairs and CIDA was created 31 years ago. I presume that at the time they felt that it was not necessary. At the time of the foreign policy review, in 1994-95, the joint committee of the House and the Senate asked themselves the question of whether there should be a legal base as opposed to using the foreign affairs legislation. In the end, people did not rule on that, but they certainly debated the question for a while and asked a lot of questions about it. There is no question that there are advantages to having a legislative base, but no move has been made in that direction; therefore, the law of foreign affairs is the statutory base for our activities.
Mr. John M. Robinson, Vice-President, Canadian International Development Agency: In addition to the Foreign Affairs Act, in which there is a passing reflection of CIDA, we are also governed by the provisions of the Financial Administration Act and other acts. CIDA is not without legislative guidance, but there is no legislation that deals with us as a department. For all intents and purposes, we are an independent department of government. We have our own minister who sits as a full member in cabinet. The fact that there is no legislative base has not prevented CIDA from being treated as an individual department of government.
Senator Bolduc: You are independent mostly in management. In policy-making, however, you give your input and then the government decides on the basic public policies in foreign aid.
Ms Labelle: Even if we had our own legislative base, we would be expected to behave and we would behave according to Canada's overall foreign policy with respect to, for example, the decision of whether or not to be in a country. If something goes very wrong in a country, like apartheid in South Africa, and there is a decision to sever relationships with that country, then those are the fundamental policy decisions that we would and do abide by.
Of course the overall foreign policy is decided by the Department of Foreign Affairs and we abide by that. The difference now is that development policy is decided very much by CIDA. I am referring to the kind of policy framework we give ourselves in a particular country, the kind of policy framework we give ourselves for women in development, for environment, for how we will deal with poverty. There is a division of labour.
Senator Bolduc: My third question is related to the report of the Auditor General. I know that you have been working quite closely with the Auditor General for the last four or five years. In 1993, the Auditor General said that there was a need for improvement in CIDA in terms of assessment and analysis of the programs.
I have here in front of me the Auditor General's report for 1998 on your agency. On page 18, the basic thrust of the report is that CIDA is improving in terms of management and in terms of evaluating its own programs, but there is still work to do. You have been pretty eloquent in describing your plans and priorities. It is a major improvement and that gives us a more concrete picture of the variety of your activities. At the same time, the Auditor General says that there is still work to do in terms of analysis, policy evaluation and program evaluation. That last is an aspect that this committee has been looking at for maybe six or seven years; we pushed really hard on that the program evaluation component of government activities because, after all, if you have a program, it must be evaluated.
In his report, after explaining the types of things that you gave us as your objective and priorities, the Auditor General says that there is still much work to do in terms of indicators of the results or the impact of your activities in the developing world. On page 18, he cites good indicators that he takes from the OECD, which works in co-operation with other countries. In looking at your report for CIDA, I find that the indicators in your document are less quantitative than the examples in the Auditor General's report.
Senator Fraser: Is that Exhibit 21-6?
Senator Bolduc: Yes, it is.
Senator Fraser: That is on page 16.
Senator Bolduc: In French it is on page 18. There are the objectives for economic welfare and then the indicators, and then same thing for development, durability, improvement of environment, and finally general indicators. What do you have to say about that? Do you think that the Auditor General was too severe or too tough or was he fair?
Ms Labelle: About four years ago, CIDA started to establish a framework where we would be working on a results-based approach. We have been turning the management of programs around to achieve that.
The Auditor General would agree that we have done very well at the level of projects. If we agree to help a country try to establish a primary school system that works and then when you go into a community and you see all the children in school at the primary level, that is an indicator in terms of outcomes, outputs and eventual impact. We do have that indicator.
The difficulty is to try to bring this up to a higher level of aggregation. We had a good debate with the Auditor General on that as a matter of fact. We were looking for advice from that office on a difficult question: If you are helping a country with primary education in a region, to what extent can whatever success that country achieves at the national level be attributed to what you have done? We may have trained the teachers or we may have assisted the community to manage their schools, which they were not doing before. There are a number of things. The question is the attribution, whether we can say that we are responsible for results at the country level.
In education, we work in many different countries. At times we help with teacher training, at times with putting up schools, at times with curriculum, with books and so on. In the end, it is very difficult to say, "For all that we do around the world, here are the indicators that have been met," because the aggregation is difficult.
The Auditor General would say that at the level of projects we are doing very well. We are very pleased and we reviewed these. There is constant monitoring at the end of every year. Every project is reviewed in terms of where we are as compared to where we said we would be. We are working with the OECD and closely with the World Bank to see whether there is a way around the difficulty of the higher level aggregation. I think the Auditor General agrees with us that this one is not easy. We need to continue to see whether it is feasible, but that feasibility has not yet been fully demonstrated. That is part of the rationale behind this comment.
Senator Lavoie-Roux: How do you go about evaluating whether the money that you are handing out to countries and governments and so on goes where it should be going? How do you know that it is being well spent? For instance, someone who went to Uganda told me that all of the money does not go where it should be going. I do not know where it is being distributed, so that worries me. I heard a similar remark from Canadian embassy personnel or staff in other African country, I believe. They told me that there should be close examination of the use being made of OECD money. What kind of control can you exercise and how successful do you feel you are?
Ms Labelle: Today we do not transfer money to governments. We agree with the governments of the countries or with the community on their needs and their priorities, what is it that we can best do, and then we turn to Canadian expertise to manage on our behalf that particular situation. For example, if a particular country says that they would really like to help their people have access to credit because they do not have it, we could turn to one of our Canadian co-ops that has experience in that part of the world. The co-op would work with that community to develop a cooperative and pool their money in order to do their own development. However, we would not transfer resources to that government to do that.
In the 1980s, there was a substantial push towards structural adjustment to try to help countries reduce the great deficits that they had then. In a way, most of them could have been bankrupted. Institutions like the World Bank and the IMF who were managing this very closely provided resources. We do not do that anymore. What we do is agree on needs and priorities, turn to Canadians and then monitor very closely the results. They do not have money until they have delivered. The advances are very small, very short. People are not ever given a total amount. They receive either monthly or quarterly instalments based on reports of how the work is proceeding. We either have a special monitoring institution or we do the day-to-day monitoring of the results. That is how we make sure that the resources go for the purpose it was decided they should, and we are satisfied that it is working.
If a specific situation ever occurred, I hope that you would raise it with us so that we could investigate immediately, which is what we do whenever there is a question or a doubt somewhere. We hire special external auditors to move in and review the situation. We do not let it go.
[Translation]
Senator Lavoie-Roux: Are there not areas where control is more difficult? For example, for resources which you make available for education and that must be used for school construction or teacher training, this can be relatively easy to control. In health, where you have vaccination and prevention programs, it may be much harder to exercise control as to whether the money has actually been used for the purposes for which it was granted.
Ms Labelle: Precisely. If you consider immunization, for example, we are working with the WHO, which has its network throughout the world to help countries establish immunization systems and vaccine quality control methods. We are also working with Unicef to provide vaccines. So we do not give more money to the country to buy a vaccine. When the time comes and it can do so, it probably will not need us and can do this using soft loans or other arrangements. Unicef, the WHO and the Canadian Public Health Association are our three partners in the area of vaccines. You are right, it could be much easier in this area to divert vaccines or the needles that are used.
Senator Lavoie-Roux: Is it your impression that all the money you grant to a country is being tightly controlled?
Ms Labelle: The Auditor General is also our external controller on a fairly regular basis. For each project, we conduct periodical audits and, in many cases, mid-term assessments. We monitor the project as it moves forward so that, if something is wrong, we stop and we take a look at what is going on. If we see there is a problem and we are not sure of the result, we cancel the project, even if it is half implemented. This does not occur frequently.
[English]
Senator Fraser: I am asking you about the proportions of your budget allocated to the various areas. I see that 25 per cent goes to basic needs, but we are not told what per centages go to the other priority areas.
Ms Labelle: That is the one sector where it is pre-allocated. For the other sectors, we identify retrospectively how much of the resources has gone to each of our program priorities. We report that to Parliament in our performance report as well as in part III of the document I gave you. Compared to other sectors, the governance sector has grown because of the demand and the need at this time. That is the only one that we pre-allocate. For the rest, we agree with a country on needs and priorities and we review those on a regular basis because their needs change often. For example, we had to modify completely what we were doing in Honduras and El Salvador. If we want to give the people of a country ownership of their development, if we want to work on their needs and priorities, then we cannot allocate too much in advance, because we begin to skew what might be important to them.
Senator Fraser: I wonder if I could look at one area, women and gender quality. I am looking at the English versions. Page 10 of the blue book and page 16 of the Auditor General's report seem to set out rather different perspectives. The blue book says that an expected result is the advancement of women's equal participation with men as decision-makers in shaping the sustainable development of their societies. Parenthetically, equal participation is not a goal we have reached here, let alone there. It also refers to women and girls supported in the realization of their full human rights. The Auditor General has as a goal eliminating gender disparity in primary and secondary education by the year 2005. Did he pull that out of a hat? How do we reconcile those?
Ms Labelle: The OECD has picked up a number of specific targets or goals that have been identified in the multiple summits around the world and has lifted them to say let us not forget that these are achievable if we work together on them. Let us keep them as a beacon. The latter one arises out of that.
Senator Fraser: This is what we should figure is your authoritative statement.
Ms Labelle: Yes.
Senator Fraser: Well, good luck.
On the question of debt forgiveness, we have forgiven $1.3 billion of our debt; that is Canadian, not multilateral, right?
Ms Labelle: It is Canadian.
Senator Fraser: How much is left of our debt?
Ms Labelle: In terms of our bilateral debt for ODA, we have every one except Burma for the least developing countries.
Senator Fraser: That is the $100 million for $1.3 billion.
Ms Labelle: What is left now are sort of the agricultural credits in some of those countries where the EDC is still present.
Mr. Robinson: We have forgiven all of the debt for Sub-Sahara and Africa and the Commonwealth Caribbean. We have done a debt-for-environment swap in Latin America. The parts of our ODA that are outstanding are debts in the subcontinent, largely in India and Pakistan. I do not know the exact figures, but something in the order of $400 million or $500 million is still outstanding in debt. Those countries do not fall within the parameters of the Highly Indebted Poor Country Initiative and so would not normally be subject to debt forgiveness.
Senator Fraser: I want to move to the parameters, particularly the international, multilateral parameters. I am not very familiar with this field. As I was trying to prepare for this meeting, I was struck by the concept that for a number of these countries there is a six-year framework, divided in two tranches of three years, dependent on good fiscal or economic -- I am not sure which -- performance. Who defines "good performance"? How is it defined?
Ms Labelle: I am sure you have read about this issue and will continue to read about it over the next number of days because it is to be discussed at the G-8 summit taking place in Cologne. At the World Bank Development Committee, Canada has been making representations on a number of items. One is to try to reduce the length of time. Also, we want to try to reach some of the countries that are part of the list for the future in order to bring them in faster.
As for who decides, there is a lot of discussion among our executive directors, the World Bank and IMF. Basically, the multilateral framework has been worked out by the World Bank and IMF together, but the developing countries themselves have been participating increasingly, as they should, in the discussion about the parameters, the criteria and the guidelines.
We have been on the side of making it easier, faster and more generous.
Senator Fraser: Can you give me some examples of what some of those criteria would be? Are we talking about balanced budgets? Are we looking at a Reagan-like economic program here?
Ms Labelle: What is expected is that the countries will have prudent fiscal management and, therefore, a budget that over time would be balanced. In all of these countries it cannot be early on. We have been pressing for more balanced budgets. How much goes to armament and how much goes to military in relation to other aspects of the budget is becoming an important consideration, because you could have a lot of money moving into those countries. Those are some of the criteria and the kind of legislative framework that people have given themselves to manage themselves on an economic basis.
We have been exerting considerable pressure to make sure that the IMF and the World Bank do not create a situation where those countries must reduce their social funding, because that happened in the 1980s and 1990s and created major problems. There must be a good balance between social and economic so that you do not destabilize the country and create worse problems than you solve.
Senator Cools: Perhaps we could also in the future have some discussion at the larger committee level about when the subcommittee will take over regular committee slots. Perhaps we could have a discussion about that.
You have raised many issues. Obviously, the subject-matter is enormous. Is this a permanent order in council for 30 years, or is it renewed from time to time?
My fundamental questions relate to what you have described as development policy and the setting of development policy. What is the process by which development policy is made? For example, I am told that one of your priorities is human rights, democracy and good governance. What is the process by which that issue, that particular subject matter, democracy and good governance, would have been chosen as an area of involvement?
Ms Labelle: The original order in council still stands. The part in the foreign affairs legislation is also there. In terms of the policy, the program priorities and the mandate, the overall framework was adopted at the time of the foreign policy review by the government following the House and Senate committee proposals and it fits very well. That was in 1995. If certain of our policies are such that we really must go to government, then we go to cabinet for review or approval. For example, we escalated the level of involvement for Cuba a few years ago. It became a cabinet decision to do that. The amount of resources allocated for humanitarian assistance for Kosovo was a cabinet decision as well, because we were dealing with a major issue.
On the other hand, we have had health as a priority and we have worked to develop a framework for how we would achieve that priority, and that we have done in discussion with other federal departments, with many partners in Canada and with our partners internationally.
Senator Cools: Did cabinet take the decision or did you take the decision that human rights, democracy and good governance would be one of your six priority areas?
Ms Labelle: The government did. The government identified those priorities as well as the 25 per cent for basic human needs that you raised earlier.
Senator Cools: I do not mean to raise any issues of partisan politics, but which government decided, the previous government?
Ms Labelle: It was in 1995.
Senator Cools: The same time?
Ms Labelle: Yes.
[Translation]
Senator Ferretti Barth: Since this organization was founded in 1968, countries have grouped together to provide assistance to underdeveloped countries. Today we can say that we have helped certain countries develop. Which countries have become economically and industrially self-sufficient as a result of our aid?
Ms Labelle: The Caribbean is a region where Canada made a major contribution in the 1970s and 1980s. We no longer have any programs in certain countries in the region, such as Barbados, for example. Barbados is not a rich country, but it is self-sufficient. Talking about this region in particular, Trinidad and Tobago would be two others.
Senator Ferretti Barth: Are there any other countries that are about to become self-sufficient?
Ms Labelle: We have identified Thailand, Malaysia and Indonesia. We believe these countries will be able to recover quite quickly, particularly Thailand and Malaysia.
We have had to move back the timetable. We review it each year and it is really declining. We saw ourselves completely out of there in three years. We were not doing any new programming and we were completing the projects we had started.
Senator Ferretti Barth: To date, CIDA has given $3,800,000 to Sierra Leone. You have been helping this country for three years now. I read a report on the subject and the situation is deplorable. The country's armed forces are holding the general population hostage and committing crimes against humanity. They are still there and they are very well armed. I wonder what the $3 million was used for.
Ms Labelle: Mainly for emergency humanitarian aid to help amputees. We provide them with medical assistance through organizations such as Médecins sans frontières and the International Red Cross.
The money was also used to help refugees who have moved around within the country. It is very difficult to work in Sierra Leone because security is always an issue.
Without a bilateral program, we are acting where we saw it was possible to help people survive and did so through the Red Cross and Médecins sans frontières.
Senator Ferretti Barth: The financial aid we provide to this small country has not helped restore order or create any human awareness. Is it worth continuing to help this very poor country? Where does the money come from for the very modern weapons used?
Something is wrong here. CIDA should conduct a special investigation into these atrocities. Money should be sent to put an end to these atrocities which have been going on for three years now.
Ms Labelle: Sierra Leone is one of the most difficult countries. Sudan is another one, but atrocities there are not as great and aren't as numerous. We are cooperating with the international community, both multilaterally and bilaterally.
We are working with England and France to determine opportunities that would enable us to help this country restabilize. It is difficult to get there because of security problems. All we can do for the moment is wait until we have found a way to act as part of the international community and to help those who have been the hardest hit.
We know perfectly well that this is a stopgap measure, not a long-term solution. It is to enable people to survive. We are doing this with well-known international institutions.
Senator Ferretti Barth: Why continue to help this country and send money? You know perfectly well that we can only intervene outside areas of conflict. CIDA is giving money to these people and we cannot get in there. How is this money being spent? How can we justify the fact that these people are so well armed? Why provide weapons to mutilate people?
Ms Labelle: Many people wonder where the weapons are coming from. They are obviously coming from the outside. We are not giving money to this country. We are working with the International Red Cross which tries to provide the least well-off with humanitarian aid to enable them to survive pending another solution. We are not handing out money except to the Red Cross, Médecins sans frontières and Care Canada.
Senator Ferretti Barth: Do you know what results the Red Cross's efforts have produced? We need a report since we are going to send $1.5 million. What has our humanitarian action produced? How many children have been cared for and how many families have been housed? Do you have a report on how the financial assistance was used?
Ms Labelle: I do not have any information with me, but I can submit it to you. When we work with an institution such as the Red Cross, we know exactly what they are going to do and what they have done with the resources. The same thing is true with Médecins sans frontières. These doctors operate on amputees to prevent gangrene in their amputated limbs, as you mentioned earlier. We will be pleased to provide you with the information on Sierra Leone and what we have done there.
Senator Ferretti Barth: I read in your presentation that, in infrastructure services in China, CIDA has introduced an irrigation system model that will use 30 per cent less water than the conventional system and will protect soils while improving productivity. Couldn't this project be introduced in other countries than China?
You spoke about a water shortage. Nations will have very little water. They must irrigate, and so on. These countries are already aware that they will be suffering from a water shortage. Have you made any efforts to offer this infrastructure system which has had such great success in China?
Ms Labelle: In China, we have done this in the form of a pilot project. We are working with the Chinese government so that other regions can benefit from the project. It is spreading across China. This is important because it means that our project has produced many children -- not those who help increase the world's population, but those who help.
For the other countries, we are talking with a particular government, with the people, and this priority issue is on the table. We are doing a number of things.
In Ghana, we have supported a program that is somewhat different from this one. This program provides clean water to every small village which otherwise had to go looking for water elsewhere, in areas where people were drinking the water and dying as a result. The program is managed by the women in the communities. We are doing this at a very low cost for each of the wells. In an entire region in Ghana, communities now have clean water. We can help these people solve this problem.
There is a risk of major conflict in the area of water. In the Mekong and Nile regions, for example, we have developed a project with the countries bordering on the rivers so that they can manage the water together.
Senator Ferretti Barth: A cooperative.
Ms Labelle: That is correct. If someone at the source of the Nile -- the Nile is not a big, wide river -- decides to implement an irrigation project, there will be problems in Egypt, and conflict will obviously result.
[English]
Senator Moore: Looking at pages 14 and 15 of your performance report, on the right, I see $86.5 million for countries in transition. Does that refer to the countries shown on that portion of the map, the former Soviet Union countries and so on? On the left is a graph showing the moneys that were spent in the various countries. The only one I see that would be in that area is the former Yugoslavia at $18 million. Where else was that money spent?
Then I want to come back and ask you about the former Yugoslavia.
Ms Labelle: In the category of countries in transition, the major countries are still Russia and the Ukraine. The Ukraine is there primarily because of the energy problem where the European Bank for Reconstruction and Development and a number of bilateral donors have come together with that country to try to prevent another Chernobyl and to help them with their energy needs. It is still a disaster waiting to blow again.
Senator Moore: How much money is for the Ukraine?
Ms Labelle: I will have to send you that.
Senator Moore: Is it more than $11 million?
Ms Labelle: It would probably be around that or a little bit less. It is something like $40 million over 5 years. Do not take that as definitive.
Senator Moore: It is not on the graph. What about for Russia?
Ms Labelle: Russia, the former Yugoslavia here was $18 million.
Senator Moore: I want to know about this $86.5 million. We are looking at $8 million for the Ukraine. So where is the other $78 million?
Ms Labelle: Russia is more than the Ukraine, so Russia would likely be closer to the former Yugoslavia; but then we have Romania, we have the Balkans, and of course now Kosovo. Next year you will see quite a different level of resources. There will be a bit in terms of the Czech Republic, Hungary and Poland, although moving down. A number of countries there are likely to be graduating within the next three to five years. I would be pleased to send the list of all the countries, including Central and Eastern Europe and the annual budget as well as the planned five-year expenditures.
The Chairman: Would that be satisfactory?
Senator Moore: That would be helpful. If you could do it in groupings as well so that we could see them, that would be appreciated. The example that I raised was the $86.5 million. Of course, this is to the end of March 31, 1998, so we are dealing a year back. What countries would that have been spent in? Does that include Bosnia?
Ms Labelle: The largest part of that has gone to Bosnian reconstruction.
Senator Moore: So most of the $18 million would have gone there. You mentioned that there was a decision made by cabinet with respect to Kosovo. What are you looking at there? Was money spent there in the 1998-99 year or are you looking to budget something for 1999-2000? What kind of numbers are you looking at? What sort of agencies will we work through to make sure that the money ends up in the right hands and that the right thing is done with our tax dollars?
Ms Labelle: In terms of CIDA and Kosovo, at this time it has been humanitarian assistance. We have an approved budget until today of $52 million.
Senator Moore: Is that for the 1999-2000 fiscal year?
Ms Labelle: Yes, with some of it spent in the first part of 1998. I am looking at it retrospectively as well. That is not all spent as we speak. Approximately $35 million to $36 million has been spent on food, blankets, support to the UNHCR, working with CARE Canada, the Red Cross and to some extent with Médecins sans frontières. We see the future of Kosovo in terms of reconstruction and peace building. Removal of land mines is one of our priorities.
Senator Moore: Is that sort of thing funded by CIDA as opposed to the Department of National Defence?
Ms Labelle: The removal of land mines is usually done in two ways. The peacekeeping group, as they are entering Kosovo now, will be using their heavy machinery to remove probably about 70 per cent of the land mines. The soldiers will open up the major avenues, making sure that where people go through, the villages are cleared for immediate return. After that the question is whether there are some in the fields that people would be cultivating. That is when it turns to us. The first part is definitely through the peacekeeping operation.
Senator Mahovlich: Whatever happened to CUSO? Is it still around?
Ms Labelle: It is alive and well. It has recovered. CUSO is still doing work in many countries around the world.
Senator Mahovlich: I had a nephew who taught drafting in the middle of the Congo in the 1960s. I have often wondered: Has the Congo improved?
Ms Labelle: Unfortunately, it has not, but I know it has nothing to do with your family, senator.
Senator Mahovlich: He came home and I think he needed psychological help for about five years. It was very difficult for him. I remember him writing letters to my mother. It was a terrible experience.
Ms Labelle: Many Canadians have done development work through CUSO as young people or even not so young people.
Senator Mahovlich: We have had some good come out of it.
Ms Labelle: Yes, no question. CUSO still does good work today. I am surprised there is not somebody in the room who has worked for CUSO.
Senator Cook: I have a question on your youth program, although you might not be familiar with the details. I first became aware of CUSO as a Girl Guide when we planted orchards and dug wells in Angola. Are those programs ongoing? They serve a dual purpose, helping the other country and our own Canadian youth. They create awareness. Is that a dollar-for-dollar match for funding for the organization?
Ms Labelle: That is what our partnership program does mostly. Many of our programs there are a match. When we work with the Canadian Food Grains Bank, they raise a lot of money through the churches and through the agricultural community who give some of the food they produce to that food bank.
We have a number of youth programs now. CUSO and WUSC still do quite a bit of work with youth, but that is not their only focus. Their vocation has changed a bit since the early 1960s. We also have Canada World Youth and Canadian Crossroads International, to name just two of the volunteer sending groups for youth. We have opened a segment of the government's youth internship program for international cooperation where our partners bring a young Canadian as part of their project or their team. That program has had very good results. It was meant to be transition from university or college to employment, and the great majority are finding employment, many of them with the organization that took them in as an intern. It has been quite successful. Finding more ways of internationalizing our young people pays off in terms of their openness to the outside world.
Senator Cook: My second question is on the health sector. I come from Newfoundland. We are very much involved in East Africa with the telemedicine program. Do you see that as a wave of the future? We had an interesting partnership when a group of our nursing instructors went to Angola and brought their people back to Newfoundland and trained them in our hospitals. When those accredited licensed nursing practitioners returned to Africa, would that ongoing program in that country be the sort of thing you would fund?
Ms Labelle: Usually, the project must include a strong sustainability component, meaning that we must take them to the level where they no longer require support. Often we do what you did in Newfoundland, which is to agree to do some periodic refresher or coaching, and that usually carries them very nicely towards self-sufficiency.
Senator Cook: You see that as a plus for the country. What about telemedicine? Do you see that as a wave of the future? Will we bring it into the millennium?
Ms Labelle: We have used Newfoundland as a very good model and example of what countries could do. We have adapted what has happened in Newfoundland to the situations of other countries. We have reached out to people without creating a physical infrastructure, which they cannot afford. We have also had other models where we have twinned some faculties of medicine in a developing country with those in Canada so that a lot of the training can be done electronically. Some of our people help with the training in residency or specialized training, or they come to Canada for a short time. It costs much less and there is a greater chance that people will stay in their country to help their people after having been trained within their country to do that.
Senator Cook: I searched through here and I could not find it listed. I figured that it was insignificant in the big scheme of things. I was just curious.
Ms Labelle: It was not used as an example. We rotate the example that we use to provide a breadth. I think that we will retain that for next year.
Senator Cook: I was part of the nursing program and I was really excited about it. I thought that that was the wave of the future, coupled with telemedicine. I felt that we could help those people in developing countries to become self-sufficient.
Ms Labelle: One of the great difficulties in many developing countries is that they have either physicians or unprepared health workers. That can create major problems. We now have an increasing demand to prepare nurses so that they have that middle group who can be prepared in greater numbers and very often stay longer.
Senator Cook: It will be an ongoing thing, then?
Ms Labelle: Yes.
Senator Bolduc: What are the mechanisms for coordinating bilateral aid? I suspect that a lot of European countries give money for work in the same field as you do. For example, I remember that when I was in Africa working for the World Bank, I would often see agricultural machinery or equipment lying in fields. There were no spare parts, so they could not use them. I realized that they had a John Deere tractor from the United States, and another brand of tractor from Europe. How do you try to coordinate your help?
This is true for both developing countries and for those that are in transition insofar as the aid that we provide in helping them to become more democratic and more market-economy minded. I know that you work on both aspects. You must have some organization within the OECD or some other area.
Ms Labelle: There are a number of levels in this. Once a year, the World Bank leads a group. It invites all the donors to meet with each country that receives significant resources. So at that particular level we come together, and the country in question comes to the table. We have maybe two days of discussions to see where the country is headed, whether there are things we could do best by doing them together.
On the ground, in the country itself, we are now trying to improve that coordination. On the day-to-day level, we make sure that we look for synergies, for opportunities to work together where we can have a bigger impact than we would have if we were to do it alone.
Senator Bolduc: The Italians, French, British, the Americans and perhaps the Germans send their surpluses to those places. They do not necessarily send what is needed.
Ms Labelle: In Bosnia, they needed energy because they could not heat themselves. So the Japanese, Canada and Great Britain decided to come together. We could not have afforded to do it by ourselves. The Japanese could have done it by themselves, but they wanted the know-how from Canada. We also generally all work together in planning reconstruction or development.
In Haiti, the top priority was establishing a system of justice. So France, the United States and Canada adopted this as their project. We decided between ourselves what we thought we could best do, and divided the work accordingly. By working together, we have a greater capacity than we had before. Before, our capacity was nil.
Senator Moore: Did you say that the World Bank meets just once a year with the donors in receiving countries to assess the matching of aid with needs, in order to get maximum results?
Ms Labelle: Yes.
Senator Moore: What happens in between?
Ms Labelle: There is a summit meeting once a year where you really focus on that country. The rest of the time there could be a number of meetings within the country, with the UN, with the bilateral donors who are in that country and with the World Bank, as well as with other multilateral institutions if they exist in a particular country. This once-a-year summit meeting takes place at the high level. However, at the more specific level, meetings take place in the country on a periodic basis, depending on whether the country is stable or not, and they happen on a sectoral basis.
Senator Moore: Do we have a requirement as a donor country to receive reports regardless of what level exists in these countries that you mentioned? Are reports required every 30 or 90 days? Do we establish a reporting regime or are we just letting it go along?
Ms Labelle: In terms of our executing agencies, we establish in our contracts with them from day one a regular reporting schedule. Depending on the project, it can be very frequent or every three months. However, when money is allocated, it is mostly on a monthly basis. When a particular country reports on its progress to all the donors, it generally happens once a year.
Senator Moore: I understand that. I am concerned that if a file is turning bad, we want to know before the year is up.
Ms Labelle: If a file is turning bad from our point of view, we monitor it on an ongoing basis.
Senator Moore: I have the same concerns as Senator Ferretti Barth.
Senator Cools: What capability or potential do you have to stop a country from selling something off to make a profit? For example, in Grenada I believe, CIDA largely built the telephone system and then the government that they built it for sold it.
Senator Bolduc: In November last year, the World Bank published a book, Who Gives Foreign Aid to Whom and Why? It is written by a man with the curious name of David Dollar and by Alberto Alesina. A lot of new research has gone into the book. The correlation between aid and growth is near zero, they say. More aid does not mean more growth. It depends on where it is given. If it is given to a good country, then it reduces poverty. But it must be given to the right country. If it is not given to a good country, it does nothing.
The authors, in evaluating countries, point out that in order for aid to work, countries must have good economic policy, low inflation, politicians who control their budget and deficit, openness to trade, strong rule of law and competent bureaucracy. Those criteria should be used in deciding to donate money.
On a sample of 113 countries, 32 lie in this high-impact quadrant with poverty rates of more than 50 per cent. This is one way of focusing. Does that book inspire you in your work? Does it help you to focus? A report published a few years ago said that you were not focused enough. You try to help in too many places at the same time.
Ms Labelle: There is no question that the Dollar Report from the World Bank makes a very strong point that if there is not a good governance system in a country, a whole lot of things do not happen. This is why we have increased our support to governance. If a country is ready, willing and capable of improving their economic policy, their budgeting approach and their banking legislation so that these banks do not collapse, then of course we offer support where we have the resources to do so.
In the former Zaire, we pulled out a number of years ago because we felt that our investment did not make a dent. We pulled out of Nigeria. We pull out very regularly and we constantly do assessments. When we do not feel that we can really make a difference, then we do not.
We do, however, have alternatives in countries that may not have problems that are so big and blatant. We may choose not to work with the country, but we may have tremendous opportunity to do grassroots work, but in a lesser way. For example, we can work with our NGOs. They put up a lot of the resources themselves and we can give them some, too, such as developing micro-credit programs for the poor in communities and helping with literacy and immunization programs. We would not have a regular bilateral program in these countries, but we would help at a much different level.
We agree with the Dollar report. The countries that do not have a high level or a good level of governance fall into many categories. There are some that you stay away from. There are others where there is a readiness or a capability to improve, and then we work with them on their governance problem.
Senator Bolduc: If we look at the history of economic growth in the last 25 years, we can say that some good examples of countries that have improved would be those that have embarked on a market economy system like Southeast Asia, Malaysia and Thailand. There, the growth has been very fast, 6 per cent a year for the last 10 years, except for the last drop that they had because of international financial volatility. I wonder if you do not have a kind of welfare approach, working a lot with health, education and things like that, instead of trying to stress the market economy in those countries. For example, you give a lot of advice on fiscal matters, on taxation. Most of the time in those countries the taxation systems are bad in that they do not give incentives to people to develop business. I suspect that it might be more efficient to work on an economic aspects approach instead of on a variety of programs because the growth rate in Africa was about 1 per cent for 10 or 20 years, compared to 6 per cent in Southeast Asia, 6 per cent in India and 9 per cent in Thailand. Those people did not receive our aid. They managed to develop a market economy system, which seems to have developed their economies much faster than all these other programs. Maybe I am prejudiced, but I notice that only one of your priorities out of six is the development of a market economy. To me, that is the only solution. There is no growth possible in those countries without a market economy. It is very tough to begin one in those countries. I would place a much higher priority on that than on many other things, except for emergency health or food situations. That is my feeling.
Your agency spends $7.5 million on policy. It is a lot of money. Secondly, you spend about $2 billion, although maybe some of that is spent by the Minister of Finance and by External Affairs, and it costs about $100 million to support and manage that. It seems to me that you spend a lot on managing it: it is nearly 7 per cent.
Ms Labelle: We should enumerate what is in that sector because policy is a small part of it. We have professional and scientific advisors at the senior level who are really the knowledge-base of the institution, in terms of health, environment, governance and human rights. There used to be a special branch a number of years ago, but it was abolished and the scientific and professional staff were placed in each of the programs. A core of the most senior people was kept, so we had an institutional capacity beyond what each program had. We have also kept all of the data. Part of our institutional memory is there. Libraries too fall under policy, as do a whole list of things. All of these things account for the 7 per cent that we spend on management and policy, which would appear to be a high figure, without taking all of this into consideration. In terms of foreign affairs, what exactly are you referring to?
Senator Bolduc: I am referring to the $100 million for the management of CIDA, in other words, to about 7 per cent of the entire budget.
Ms Labelle: If you look at the management costs in most institutions, it is often between 10 and 13 per cent rather than 7 per cent.
Senator Bolduc: Yes, but you are giving a lot. There are many grants.
Ms Labelle: Yes, it is a question of being able to manage those, but we also develop the projects with the countries. We monitor, we evaluate, we do all of this, so at 7 per cent, I think that we are doing pretty well in comparison to most institutions in terms of management costs.
Senator Bolduc: You have about 1,200 people?
Ms Labelle: Yes, we have close to 1,300.
Senator Bolduc: You have about 50 per cent here and 50 per cent in the field?
Ms Labelle: No. Before I came to CIDA, because of cost, there was more centralization. This is not necessarily the best solution, but it costs about two-and-a-half times as much to have someone in the field as it does to have someone here. It costs us less to have our staff travel significantly. This is harder on our staff. They sometimes have to travel for a third of the year to the countries for which they are responsible. We have people in the field that link up with them, but we have fewer than we would normally have.
Senator Moore: What is the breakdown of the staff in terms of per centages? How many are in Ottawa or in the central office? How many are in the field?
Ms Labelle: We have approximately 125 in the field. In 1992, we recentralized.
Senator Bolduc: The other half of your staff go all over the world?
Ms Labelle: Two thirds spend a lot of time and energy in the field, but this is much less costly for us, although it is not as ideal.
Senator Bolduc: How about the use of the universities? I have noticed that a lot of people come here for training and they have a tendency to stay here instead of returning to their countries. Why do you not send a university professor over there instead of sending the people here, because otherwise they do not serve their people.
Ms Labelle: People that come from Asia generally return; there is a very high rate of return. For people who come from Africa, the rate of return is much lower. We have been working with universities to see whether we could bring people here for maybe one or two years of their studies, instead of bringing people here for a four-year period. This would be based on an understanding between two universities. Usually the shorter the time, the less likely people are to stay. We also want to concentrate a little more on the Master's level, because people are a little older, they have usually started a family, and the likelihood of their return is much higher.
We have quite a significant number of programs where people from universities and community colleges go to different countries and help institutions to establish themselves and do some training on the ground because it is less expensive.
Senator Fraser: I also want to ask about the Dollar report. I have been looking at the performance report for the year ending 1997-98, and I see for example that in that year you spent approximately $80 million on directly targeted initiatives for women and gender equity and $238 million on directly targeted human rights democracy and good governance initiatives. Would those proportions be likely to be carried through this year?
Ms Labelle: Yes, they would be pretty close to it. However, just keep in mind that in terms of women, we have many projects, for example in micro-enterprise for women or in the basic education of girls, which become coded in something else.
Senator Fraser: I understand that, but what I have here refers to the directly targeted numbers. It seems to me that the human rights category is a big catch-all for human rights, democracy and good governance. The increased collection of customs duties in Mali, which was one of last year's projects, for example, has minimal relevance to human rights although it has great relevance to good governance. I am particularly interested in the human rights component of this. There is surely an ongoing tension between Canada's dedication to the cause of advancing human rights and dealing with some of the regimes that you are dealing with. Sometimes, when things are really bad, you just pull out, and that applies to many appalling human rights situations as well as to countries where the government does not want to develop the country or whatever. What about the middle ground? What are the criteria, what are the rules of thumb, what are the policies that determine where you go, what you do?
For example, helping China develop an excellent statistical service may be wonderful in the development of good governance, but given what we know about the Chinese record on human rights, we are helping them to develop a tool which could easily be misused one way or another. How do you approach this fundamental problem?
Ms Labelle: Let me use China as an example. We have discussed with China what priorities we can best assist them with. We have been sponsoring a project for the last three years to help Chinese women understand their rights under the law; a law that was proclaimed around the Beijing Conference on Women. This has been very interesting because now, in a number of provinces, women's organizations are saying that that is fine, but that one of their big problems is that they do not have access to any legal assistance. They have no recourse if, for example, their husband decides to sell the land that they are living on and go and live with another woman in the south where he has been working. We are now working with them to establish a form of legal aid for women, which again falls very much into that broad category.
We look for these opportunities in countries where suddenly it makes sense for us to proceed in a particular way, especially when there is an opening and sometimes an offer. We have been working with certain countries to help them set up a human rights commission, using our own knowledge in Canada about how to do that, so our aid takes different forms and shape.
When do we decide that the Government of Canada should pull out? It could be under our recommendation or a situation like the one I mentioned earlier. It is more difficult to make decisions about the middle ones because if you pull out, you no longer have tools that you can use to influence or help. If you are not there, you cannot seize opportunities as they arise. There may not be as many opportunities as you would like, but sometimes you can build on each one and you will thus be able to have some influence.
Senator Fraser: Do we ever go on the offensive in this area? Would we, for example, use the fact that a country wants our help with an infrastructure program as leverage to have that government expand human rights?
Ms Labelle: We may not necessarily barter, but in a number of situations it becomes clear to the country that our ongoing assistance, or potentially increased assistance, depends on a number of things that happen. These are discussed with these countries. We have found that very often, if the people of those countries gain greater strength, they also become much better able to represent themselves vis-à-vis their government and the authorities. That is another avenue.
Senator Fraser: Another area that interests me is the question of what used to be called tied aid, although I do not know that the phrase is still as appropriate as it once was. I saw somewhere that 70 per cent of our aid actually funnels back into Canadian pockets. Could you explain how this system works? How much money actually stays in the developing countries? What kinds of dollars are we talking about? What kind of Canadian services or goods is the money being spent on and what are the criteria?
Ms Labelle: There is a lot of debate right now internationally about reducing the degree of tied aid under the OECD. We are 50 per cent tied in terms of Africa, and 66 per cent in terms of the other countries.
For example, we use our humanitarian assistance in terms of food. We buy this food in Canada, and that accounts for a large proportion of our level of tied aid. If we hire a Canadian university to help establish a new faculty in a particular country, the salaries of the people providing technical assistance from Canada would count against that.
On the other hand, if we are helping to build a rural road in a country, few Canadians would be involved. There would be maybe a senior engineer plus one or two people working with them, and they would work with the local people. Therefore, the local people would be the beneficiaries, not just in terms of getting the road but also in terms of work. We try to minimize the downside and maximize the upside of that. The issue of tied aid remains very much on the books and there is a lot of debate about it.
Senator Fraser: What is our position on it? I understand what we do, but I am not sure what we are pushing for.
Ms Labelle: In principle, we believe that we should have much less tied aid. In practice, we must be careful because part of the debate is that the world is looking at multilateral untying, which means that if we want to help with micro-enterprise in a particular part of the world, we would likely have to have an international tender. So we favour bilateral untying vis-à-vis the country where we work, as opposed to multilateral untying, where the greater part of our technical assistance could be provided by people from other Western countries, with very little opportunity for Canadians.
Senator Fraser: The administration cost would also rise for that if you are tendering internationally.
Ms Labelle: Yes. The debate is a bit complicated for these reasons.
Senator Cools: I have before me a copy of an article from The Lawyers Weekly dated August 29, 1997. The headline of the article is "Canada's New Global Role: `Juges sans frontières'," and the byline is, "Judges from around the world turn their eyes to Canada's justice system." This article is an interview with the Commissioner for Federal Judicial Affairs, Mr. Guy Goulard, and with the Chief Justice of the Supreme Court of Canada, Mr. Justice Lamer. In this article they say some extraordinary and interesting things.
One of the things here for example is, "Juges sans frontières" or "judges without borders" which is how Chief Justice Antonio Lamer smilingly refers to his brainchild. Earlier in the article it says, "Mr. Goulard coordinates a growing number of highly successful international judicial cooperation projects, many of which are financially supported by the Canadian International Development Agency."
Now, about two years ago, on December 9, 1996, in an interview with Mr. Chief Justice Lamer on CPAC, Mr. Justice Lamer stated quite clearly that he was very disappointed that the Senate had amended the Arbour amendment, which was what he called elements of Bill C-42. Mr. Justice Lamer said,
...I was a little disappointed, when the Senate amended this Arbour amendment because...it was made general for the purpose of enabling judges...to go into countries...
It continues,
And that amendment would have made it more easy to meet the expenses because judges...were supposed to receive money only under the Judges Act...
He said:
I was a little disappointed but I found another way and I'm going to be having lunch today with Madame Huguette Labelle, the head of CIDA, then I think we're going to go through CIDA. Well, where there is a will, there is a way, and I will be very proud to see 20, 30, 40 judges of Canada, at no Canadian judge's expense, except that Canadian judge's free time...a bit like Médecins sans frontières, you know, Doctors without frontiers.
Perhaps you could share with us exactly what it is that CIDA, and you in particular, have been doing in this regard. It was my clear understanding that the judges of Canada, under sections 54 to 58 of the Judges Act, are only supposed to receive money from the Canadian government. I wonder if you could expand on what was said. Maybe it is not totally accurate, I do not know. Can you tell us about CIDA's involvement in judicial affairs and the role of the Chief Justice of Canada, in respect of Canadian judges' international activities across the world?
Ms Labelle: First of all, we have a number of demands from countries to assist them in establishing rule of law. It all begins with a judiciary that works, so the need and the problem are there. It is part of the governance question that you were talking about earlier, Senator Bolduc. We do get these requests.
We have a number of avenues, but not a lot of resources in Canada to support that. We have been working with Mr. Goulard by helping to identify expertise at different times in order to provide technical advice. The demand is much higher than what we are able to meet at this time.
Senator Cools: Perhaps you could give me a bit more information. I am not concerned about the demands from across the world. I am especially interested in these projects where you are funding the Commissioner for Federal Judicial Affairs to do these things. I should like to know the quantities of money involved and how it is basically done. I am interested in how money is paid from CIDA to the Department of Justice Commissioner to finance judges going across the world.
Ms Labelle: Would you like to have the list of our projects, for example? We can provide this very easily so that you will know where the projects are and the kind of resources that are used.
Senator Cools: I would absolutely welcome it. I would like to have the list of projects, and to know who is administrating them, the quantities of moneys and the actual judges involved.
I am asking you because we have been trying to receive this information for quite some time. It just seems very difficult. I do not really understand why, because if it is such a noble thing to be doing, I would have thought that everybody would be proud of it and would be advertising it from the highest buildings.
What kind of money are we talking about?
Ms Labelle: These are not large sums of money because it is not like setting up an infrastructure project, and it is usually not necessarily something that requires full-time people. This is technical assistance. Someone comes in for a period of time to review the work that people are doing, to provide direct expertise and direct advice. We are not dealing with a situation where you are constructing something. We are not looking at very large amounts of money, but we will provide this information to the committee.
Senator Cools: I have noticed that in a part of the same article that I just cited from The Lawyers Weekly, it reports that:
Chief Justice Lamer said his discussions with senior Chinese judges have convinced him that the judges themselves genuinely want to improve their justice system, while the Chinese government wishes to implement reforms which will promote investor confidence.
This is outstanding, extraordinary.
I am just curious, of the $62.3 million that goes to China, is any of that involved in these projects?
Ms Labelle: We have one project with China, which is to assist with the retraining of judges. This is not a large amount of money. This is one of many projects.
Senator Cools: I am not so much concerned about the amount of money as I am concerned about the constitutional processes in which the money is flowing from you to the judges. The Judges Act is quite explicit on the issues of remuneration, expenses and payment to judges. My concern stems from a bill that the Senate had before it, Bill C-42. At the time, many senators will remember that the bill was seeking -- and I have letters here from Mr. Justice Lamer to Minister Rock at the time -- pretty large sets of exemptions from the Judges Act to allow judges to engage in international activities. The Senate took a look at it and did not like that at all, and so it did not grant the authority. However, we limited the ability to one exception, and that exception was Madam Justice Louise Arbour. The Judges Act states very clearly that Madam Justice Louise Arbour may do this or that. It is pretty explicit.
It struck me as a little odd that after the Senate unanimously amended the bill, declining to grant this authority for judges' international activities to Mr. Justice Lamer and the others, that I should turn on the television and see the Chief Justice live saying that he was disappointed with the Senate actions, but that he had found another mechanism through you and your people.
I still question whether or not these activities fall entirely within the intent and spirit of the Judges Act. I understand that they are difficult questions and you cannot answer these off the top of your head. I would have thought that some of your departmental people might have brought this forward, because these exact questions have been recurring within this committee for about three or four years.
I would appreciate any help that you can possibly give us to shed some light on this question. I believe in humanitarian assistance to many nations. I believe in aid and I believe that Canada has a very real role to play in the world. However, I differentiate between roles that I consider to be developmental, which is what we used to do some years ago, and roles that I would consider to be clearly political, as being almost neo-colonial. The business of promoting governance, human rights and democracy is not really the aid that CIDA was ever intended to provide. When CIDA was created, I do not believe that the intent was ever to have it become involved in setting up any formal governmental institutions abroad. I view the role of judges as pretty sacred. My training is largely British. Toying with the judiciary makes me very nervous.
It is an enormous subject. I do not like to see the judiciary, especially the judiciary of Canada, being put to any political purpose. That is the reason for my concern. I am not interested in the individual wealth or financial resources of a judge. My concern is that we have a duty, as members of Parliament, to protect the integrity of an independent judiciary.
The Chairman: We have talked a lot about the present and the past. My concern really is the future. When you are planning for the future, I know that you do one- and two-year game plans, as you would with any good management system. As far as your agency is concerned, what do you envisage as the greatest looming problems that this world must deal with? What processes are you now putting in place to attempt to deal with them?
Ms Labelle: One problem stands out, but there are an awful lot of other ones right behind. I would say that the biggest problem is probably the disparity, the increasing gap between the rich and the poor, and the greater number of people who are becoming excluded because of population growth and so on. That is probably more explosive than all the other very difficult issues, like illiteracy, child mortality, and so on.
That issue applies to all countries. In Canada, people are concerned about this here as well. There is disparity both within countries and between countries.
In terms of dealing with that disparity, this is a very difficult issue. It requires a number of tools, some of which are in place now. However, it means putting more emphasis on some of them as opposed to others. Therefore, our current priorities still create the foundation for people to be able to pull themselves out of poverty, and therefore reduce that disparity.
A second issue lies in working with those governments. I go back to some of the earlier questions about the World Bank and the debt issue. We want to see if we can support them in instituting a better redistribution of wealth in their country. As a matter of fact, in India, we have been helping them with their taxation system exactly for that reason. There are many more people in India who could pay taxes, and the government knows that and they want them to. Thus, redistribution is another major issue.
Third, there is the whole issue of coherence in all of our policies. That is, if people from the poor countries cannot export to the rich countries, then their economies will never be able to reach a level much beyond that of subsistence.
We must therefore focus on traditional development, as Senator Cools was saying, and on assisting with social safety nets, the social infrastructure and redistribution. We must also focus on how we can work together as a multilateral community to ensure that our markets are accessible to poorer countries so that they can export their products. We must support the development of the quality of their products, their marketing initiatives, and help them to accede to some of the multilateral trade regimes. Many important issues remain like population growth, but I still think that maybe this issue of developing a market economy is more pervasive than all the other issues, and that is why we have been focusing on it.
The Chairman: Are the richer nations starting to address this concern?
Ms Labelle: We have spent a lot of our energy in the OECD Development Committee doing a lot of work. There is special work being done on policy coherence. CIDA has also done a great deal of work, in conjunction with the Nordic countries and a number of like-minded donor countries, on the issues of how best to support governments in their social infrastructure. Of course, the work being done on the debt issue is another way. Many initiatives all coalesce both bilaterally in our work and multilaterally as well, mostly around the World Bank, the OECD and the UN.
The Chairman: You are an eternal optimist, right?
Ms Labelle: Yes. You must be in this job.
The Chairman: We put you through a long two-and-a-half hours. Thank you very much for attending. We may ask you to return.
Ms Labelle: This has been a tremendous two-and-a-half hours. The extent of the preparation of the senators was quite outstanding. It has been fun. If any of you have advice, we would welcome that very much, or if any members of the Senate or of this committee would like some additional information on what we do or how we do it, please let us know.
The committee continued in camera.