Proceedings of the Standing Senate Committee on
Energy, the Environment and Natural Resources
Issue 16, Evidence of May 27, 2003
OTTAWA, Tuesday, May 27, 2003
The Standing Senate Committee on Energy, the Environment and Natural Resources, to which was referred Bill C- 9, to amend the Canadian Environmental Assessment Act, met this day at 6:04 p.m. to give consideration to the bill.
Senator Tommy Banks (Chairman) in the Chair.
[English]
The Chairman: Honourable senators, this meeting will consider Bill C-9, to amend the Canadian Environmental Assessment Act.
Minister, I suspect that you have some things about which you would like to inform us regarding Bill C-9.
Honourable David Anderson, Minister of the Environment: Honourable senators, it is a pleasure to be back with you. It does not seem a long time since I was here previously. In fact, I have just finished the book that I promise today to give to Senator Buchanan on how the Scots invented the modern world. It goes to show how short a time it has been.
I appreciate the opportunity to discuss today Bill C-9, to amend the Canadian Environmental Assessment Act.
The bill was first introduced in March 2001 in the House. It seeks to strengthen the earlier version of this legislation as a decision-making tool. It is a type of legislation that exists in over 100 other countries.
The Canadian Environmental Assessment Act, or CEAA, as it is commonly referred to, was passed by Parliament in 1992 and brought into force in 1995.
The rationale is simple. Environmental factors should be taken into account in federal decisions about proposed projects.
Over 30 departments and agencies of government make decisions concerning over 6,500 projects each year. These include projects initiated by both the public and private sectors across Canada, as well as projects outside Canada supported by the Canadian International Development Agency.
[Translation]
Environmental assessment enables project proponents to reduce the risks and costs by quickly identifying potential problems. It enables interested parties and organizations to express their concerns and make suggestions. For policy makers, environmental assessment facilitates the incorporation of social, economic and environmental considerations.
Experience has shown that preventing environmental harm by making design changes before you start carrying out a project is much less costly and much more efficient than trying to undo the damage after the fact. Environmental assessment is an evolving practice, and Bill C-9 is part of that ongoing evolution.
[English]
I would like to provide honourable senators with a glimpse into the origins of Bill C-9; describe some of its highlights, including the significant improvements made by the House of Commons; and finally, illustrate the link between a strengthened federal environmental assessment process and Canada's environmental priorities.
I will certainly be willing to answer any questions that you may have.
The origins of Bill C-9 go back to the requirement for the Minister of the Environment to review the provisions and operations of the act five years after it came into force. I launched the five-year review with the release of a discussion paper in December 1999. The discussion paper provided the foundation for extensive public consultations by the Canadian Environmental Assessment Agency that included an interactive Web site, public sessions in 19 centres across Canada, regional workshops in 7 cities and consultation with the provinces.
The Assembly of First Nations, the Inuit Tapiriit Kanatami and the Metis National Council facilitated discussions with Aboriginal peoples. We also consulted directly with 13 regional Aboriginal organizations. The Regulatory Advisory Committee, which includes representatives from the provinces, Aboriginal peoples, federal departments, industry and environmental groups, also examined issues and options that were part of the discussion paper.
I am pleased to report that the environmental and industry groups told us that, on the whole, this was a good review. They felt it was timely, open and comprehensive.
For example, the Canadian Environmental Network issued a press release that congratulated the agency ``for striving to conduct a thorough and transparent review...''
During an appearance before the House of Commons Standing Committee on Environment and Sustainable Development, the Mining Association of Canada representative told members of Parliament:
The degree to which the government took into consideration what the stakeholders and the groups around the country said has been exemplary in the case of CEAA...
We believe that, without getting unanimity, of course, which would be impossible, nevertheless the process we used did manage to satisfy some of the more critical groups.
The first message that came out of the review was that the act does not need a complete rewrite. Indeed, after only five years in operation, a complete rewrite would indicate a major problem at the outset, which we did not have. For example, Wendy Francis of the Canadian Parks and Wilderness Society concluded in her group's five-year review submission that:
...the Act does not need a major overhaul. In general, the structure, scope, and process of the Act are appropriate. However, the way in which CEAA is being applied is deficient in many ways.
On the last point, on the application of the act, the review confirmed the suspicions that we had expressed already in the discussion paper.
The review confirmed that there is uncertainty in the way the act is applied.
[Translation]
We are also aware of concerns about the inconsistent quality of various environmental assessments. Some groups and individuals have pointed out the limitations on public participation. We can all agree that the fundamental purpose of the act and guidelines are solid. The Review recommended that the Canadian Environmental Assessment Agency have a greater role to play in the environmental assessment process.
Encouragingly, the Regulatory Advisory Committee was unanimous on the changes that need to be made. The results achieved and recommendations made in the course of public hearings have enabled us to focus on developing practical solutions to specific problems. Bill C-9 is the result of that.
My report to Parliament on the Review commits the federal government to further regulatory and policy changes in order to complete the legislative amendments before you today.
[English]
I am confident, honourable senators, that Bill C-9 will strengthen the act so that we can have an environmental assessment process that is indeed more certain, more predictable and more timely, which obviously would result in high-quality assessments and provide meaningful opportunities for public participation.
My officials from the Canadian Environmental Assessment Agency will provide you with a detailed briefing on the bill; I will touch on its highlights.
Bill C-9 includes measures to improve federal coordination and application of the act, including a greater role for the Canadian Environmental Assessment Agency. For example, the agency will gain new powers to ensure that federal efforts are well coordinated and timely during assessments conducted in cooperation with other jurisdictions. The agency will be required to promote, monitor and facilitate compliance and to establish a quality assurance program.
There is also new authority for the Minister of the Environment or ministers responsible for an assessment to issue prohibition orders to stop project construction before the environmental assessment is complete.
The bill also recognizes Aboriginal traditional knowledge and proposes to create a new class of screening tool to deal with small, insignificant projects in an environmentally sound manner.
The bill addresses a significant source of uncertainty by removing the possibility that a project that has undergone an in-depth, comprehensive, study-level assessment could then be subjected to a second assessment by a review panel. The revised comprehensive study track of assessment includes two new opportunities for public participation backed up by participant funding.
As a result of Bill C-9, there will be mandatory follow-up programs for larger projects that have been assessed through a comprehensive study, mediation or review panel. These programs will determine if the predictions of the environmental assessment were accurate and if the mitigation measures are protecting the environment as intended.
Until now, the legislation has been more an attempt to predict the future, to launch the process, but the follow-up has not been in place. We think it is important to have that follow-up.
In addition, the bill proposes to make the transboundary sections of the act more operable. It requires the establishment of an Internet site so that Canadians can easily access information about assessments of projects before final decisions are made. Environmental and industry groups praised these changes as steps in the right direction when Bill C-9 was first introduced in March 2001, more than two years ago.
The House of Commons carefully considered the bill. The Standing Committee on the Environment and Sustainable Development, under the chairmanship of Charles Caccia, took over a year to hear from interested Canadians and made many positive amendments. However, I am pleased to say that the initial consensus in favour of the bill has remained.
Changes passed by the House of Commons include the extension of environmental assessment obligations to Crown corporations three years after Royal Assent on Bill C-9. Special attention has been paid to national parks and their ecological integrity in the transboundary section of the bill. Provisions that ensure public access to environmental assessment documents, including requirements for the Internet site on project information, have been broadened and strengthened.
Finally, the government used the opportunity provided by Bill C-9 to propose amendments that close a potential loophole created by the Federal Court Red Hill Creek Expressway decision after the bill had been introduced. You will no doubt recollect that case, which seemed to go on for a long time, but led to a somewhat dismaying result from the point of view of effective environmental assessment.
[Translation]
Honourable senators, every year, the Canadian Environmental Assessment Act gives rise to potential investments of several billion dollars. Environmental assessment involves all kinds of projects in areas ranging from energy to municipal infrastructure. Investors, proponents and communities involved in a proposed project will be better served by Bill C-9. This bill provides for a more predictable and better coordinated process.
Note also that the Government of Canada uses environmental assessment for its projects based on their potential effects on the air, health, water, wildlife and our natural spaces.
[English]
What, then, is the environmental impact of this proposed legislation? First, Bill C-9 will improve the process for delivering high-quality assessments. For example, the mandatory requirement to implement follow-up programs for larger projects, the quality assurance program and the ability to track projects on the new Internet site will generate information that will be used to improve the practice of environmental assessment. Better assessments will mean better information for proponents and government decision makers.
Second, the bill's measures to strengthen opportunities for public participation will mean, we hope, that all interested persons and organizations will have a fair opportunity to contribute and see how their contributions have been used.
Once again, proponents and government decision makers will be provided with better information about possible environmental effects on air, water, wildlife and natural spaces. I trust that better information will lead to better decisions that will translate into long-term, positive results for the environment. Whether it occurs at Agriculture and Agri-Food Canada, Fisheries and Oceans Canada or at the Department of National Defence, better decisions will lead to improved protection of our environment.
With regard to the financial side, to make this happen, the government has committed some $51 million in new funding over the next five years to implement the revised act. This is new funding, in addition to previous levels of funding.
I am convinced that project-by-project and step-by-step environmental assessment will, over the next few years, become an even more valuable tool to support our environmental goals.
Senator Spivak: Minister, I come from Manitoba, as you know. There is an egregious example of the operation of the act, not this amendment, in Manitoba. I do not know whether you are familiar with it. However, as you know, under sections 5 and 15 of the original act, the government treats a project as limited, which resulted, instead of an assessment of 15 million hectares of forest, including 6 million hectares of superior-quality fish and migratory bird habitats and thousands of kilometres of new road, in an assessment of a very narrow bridge. Sections 46 and 47, on transboundary effects and international effects, use the same term, and I think that is what allowed the courts to reject everything that the forest alliance was doing.
Bill C-9 contains no amendment to sections 46 and 47 to correct what seems to me to be an obvious failing. I am wondering, is this something you plan to deal with by regulation? What do you see as fixing this obvious and egregious example of what the original bill failed to do?
Mr. Anderson: I believe you are referring to the Tolko decision.
Senator Spivak: Yes, that is correct. That takes up more than half our province, none of which has been assessed environmentally.
Mr. Anderson: When that proposal came forward originally in 1996, there were no federal decisions that triggered the CEAA process. Then, the Department of Fisheries and Oceans decided to request information about fish habitat, to confirm that. That was confirmed.
What happened thereafter was the federal government took part in the provincial process and was before the Manitoba Clean Environment Commission.
Later, the Navigable Waters Act was triggered; this was essentially the Coast Guard. With Ms. Smith here to explain the law, perhaps it will not seem so strange. There is a major impact on land, and it is only the trigger of the Navigable Waters Act that gets the federal government involved.
Senator Spivak: Migratory birds, too.
Mr. Anderson: Yes, that is correct, but it was the Navigable Waters Protection Act that triggered the issue because of the construction of a bridge. The same situation occurred in Southern Alberta on the Oldman River.
The Federal Court ruled that the assessment by the Coast Guard was completed in accordance with the act. To correct that, we hope that the new federal environmental assessment coordinator provisions will result in a more consistent application of the act, including the scoping decisions.
Senator Spivak: What section would that fall under?
Mr. Anderson: Mr. Connelly will get that information for you in a moment. While he is doing that, I will mention the quality assurance program should have a positive influence in the area. There is some flexibility in the bill, but I would hope that this type of situation would not reoccur. It was in the early years. I am hoping, with the experience we have had and the changes that have been made, senator, we will be able to deal more effectively with the type of concern you have expressed.
Clause 7 contains the federal environmental assessment coordinator provisions.
Senator Spivak: I believe I am right in saying that there has never been a trigger for an assessment under the navigable waters legislation? It has not happened.
Mr. Anderson: Are you asking whether there have been any triggers under navigable waters legislation?
Senator Spivak: I ask the question in regard to this kind of comprehensive assessment.
Mr. Anderson: I will turn it over to Ms. Smith for the moment. In my non-legal mind, there were conflicting legal decisions in different cases, one being Tolko and the other in Alberta.
Senator Spivak: The reason for those decisions, if I may say so, was the narrowness of the definition of the project. In my limited understanding, that is the problem. Section 46 talks about transboundary effects. After all, this project was not just in Manitoba, there was one right next to it, in Saskatchewan, and also rivers flow between these provinces. This seems to be an outrageous example of how not to use the Canadian Environmental Assessment Act.
It might be that this coordinating idea would work, but what if it does not?
Mr. Anderson: I fully sympathize with your frustration concerning the scoping issue, which goes back a long way. I remember complaining about the impact of the Peace River dams on the downstream marsh areas in Alberta and the lack of consideration for that in the construction.
I will ask Ms. Smith to explain some of the complications of this trigger.
Senator Spivak: I would like you to clarify the narrow scope of the project to dispel my confusion. That would be helpful. I know the court decisions are all over the map.
Mr. Robert G. Connelly, Vice-President, Policy Development, Canadian Environmental Assessment Agency: Honourable senators, let me respond by saying that under the act, there is discretion for the responsible authority on the scope of the project to be assessed. In this case, under the Navigable Waters Protection Act, the Department of Fisheries and Oceans, as the responsible authority, decided to scope the project as concerning, in effect, the stream crossings, that is, the aspects that affect navigation.
That discretion still exists within Bill C-9. That has not changed; you are perfectly correct in noting that. However, as the minister pointed out, there are other provisions which we hope will assist in bringing about more consistent scoping in the future; and he referred to the federal coordination responsibilities, or the new establishment of a federal environmental assessment coordinator.
There are many examples, by the way, of projects where assessment was triggered under the Navigable Waters Protection Act. Some have been scoped more broadly than others. We need to bring about some greater consistency. I think that has been fully recognized.
For example, if a project involves construction of a long road, and perhaps there is one stream crossing on that road, there is a judgment call to be made as to whether the scope of the project ought to be that one stream crossing or the entire road. If there are multiple stream crossings, perhaps it is more appropriate to scope the entire road plus all of the stream crossings.
I would also note that in many of these projects, as the minister has said, the particular province often conducts an environmental assessment. That was done in the case of the project you are referring to in Manitoba. We strive to have a cooperative arrangement with the provinces whereby one assessment is done that meets both federal and provincial requirements.
Those are a few comments I wished to make. Hopefully, that clarifies some of the issues you have raised.
Senator Spivak: It does not address the narrowness of the interpretation of the project that concerned 15 million acres of virtual virgin forest or superior fish habitat. I understand that it was the province that conducted the environmental assessment, but it cannot be a superficial assessment, which is basically what happened in that case. I am looking at this bill. It has strengthened the application of the act in certain respects; but it does not seem to me that it has solved the problem of that narrow interpretation.
I do not know.
Mr. Connelly: I will add one more point. It does maintain that discretion for the responsible authority to determine the breadth of the project to be assessed. I know that the extent to which the province is also conducting the assessment comes into play in that decision. Generally, we work out a cooperative or harmonized process that meets both provincial and federal requirements. I believe that is what happened in this case.
Ms. Heather Smith, Senior Legal Counsel, Canadian Environmental Assessment Agency: Perhaps I could comment on the definition of ``project,'' which is at the root of your concern.
You are absolutely correct; the act takes a very narrow approach to the definition of what constitutes a project. That is quite deliberate, because the environmental assessment would apply as soon as the federal government has a decision to make in relation to any activity that is intended to trigger the act. Therefore, the construction of a bridge will trigger environmental assessments.
Then there are scoping provisions — which are not in this bill that is before you but in the act — that provide some instructions to the responsible authorities, the departments who make decisions about the projects, on what they are supposed to include when they have a project that triggers environmental assessment.
For instance, if you are constructing a bridge, then you must also assess the operation of the bridge. If you know — or you believe it is reasonably probable — that the bridge will be expanded, you must include that. If you foresee the dismantling of the bridge, you must include that into the environmental assessment as well. That is a set of instructions to the responsible authority on how they are to define the project.
There is another realm of discretion granted to the responsible authority on what other activities they bring into it that are not directly related to the decision that they have to make, and I think that is at the root of your concern.
You are concerned that they did not exercise their discretion to include those forest activities. The courts have said, because of the scope of the rules of judicial review, that they exercised discretion and they exercised it reasonably, which is not to say that they could not exercise their discretion in another way.
I think that is what Mr. Connelly is getting at in terms of the tools built into this bill to try to encourage the responsible authorities to exercise discretion in a more appropriate way.
Senator Kenny: Is the definition of ``project'' properly part of this piece of proposed legislation, or is it part of the legislation it is amending? In other words, is it properly before the committee now or not, in your view?
Ms. Smith: It is not in the bill before you, but it is found in a definitional section of the act, and parts of that are before the committee.
Senator Kenny: It is a fundamental issue, because if it is not before us, we should not be talking about it now. If it is before us, then I think the conversation should continue.
Senator Spivak: Sections 46 and 47 are before us, and that is the point.
Senator Kenny: I wanted to hear from the witness.
Ms. Smith: The point that Senator Spivak is making is that the definition —
Senator Kenny: Are you two colluding on this?
Ms. Smith: Not at all. The definition of a ``project'' is a fundamental definition that underpins the entire Environmental Assessment Act, and also permeates the bill, I would say.
Senator Kenny: Then would you say this is properly before us?
Ms. Smith: I would say that the root of the concerns that the senator is raising is addressed in sections of the act that are not part of the bill and are not before the committee.
The Chairman: For the record, I want to make sure of the answer to the question: Is the definition of a ``project'' referred to in Bill C-9? Is the answer ``no''?
Ms. Smith: To the extent there is a parent act, section 2 of that act is where the definition of ``project'' is found, and there are amendments to section 2 in the bill.
The Chairman: Is that section 2 of CEAA?
Ms. Smith: That is right.
The Chairman: Not of Bill C-9?
Senator Kenny: Since there are amendments to that section, it is properly before us.
Ms. Smith: That is right. However, I believe the concerns being raised here are about the exercise of discretion in relation to scoping. Those particular sections of the act are not part of the bill and are not before the committee.
I think it is quite legitimate to try to understand how that definition of ``project'' works, but the root of the concern is the exercise of discretion in provisions of the act that are not part of the bill.
Senator Kenny: If this were to lead to an amendment of how you define projects, it would be appropriately before this committee because that part of the act is affected in this amending bill?
Ms. Smith: The definition of project is; that is correct.
Senator Kenny: Therefore, if Senator Spivak wanted to proceed along these lines, she would be in order — and would be in order if she decided to move elsewhere.
Ms. Smith: To change the definition of ``project,'' that is right.
Senator Kenny: That is why I was asking the question.
The Chairman: Thank you.
Senator Spivak: This is a similar point. There is a contradiction, according to the witness in the other place, between sections 5 and 15, and sections 46 and 47. Under section 5 in the original act, the government treats the projects to be assessed as very limited. That has been used in sections 46 and 47, probably inappropriately, because we are talking about transboundary and international effects there. That is my tie-in to this bill. Do you understand what I mean?
Ms. Smith: Sections 46 to 48, the transboundary provisions, do not really address the issue of scoping. They leave the issue of how the project is scoped to the discretion of the Minister of the Environment, because it is talking about his discretionary powers there.
There really are no instructions in those sections, but I would say the strength of the definition of ``project'' is that the smallest part of the life cycle of an activity triggers the act and brings it into the process. There is a real disadvantage in trying to alter that minimalist approach to inclusion, but once something is included, there are legitimate concerns about —
Senator Spivak: I understand what you are saying. I want to ask another question to do with the exclusion list. I understand that list is to be expanded. Can you give us some idea of that? Will the comprehensive study list be expanded? This committee, in one of its reports, has recommended that nuclear power plants that are shut down for a prolonged period or that undergo significant renovations be added to that project list. Are you considering that recommendation?
Mr. Connelly: Senator Spivak, I would respond to two questions. You are quite correct about the exclusion list. The origin of the commitment to look at adding more projects to the list is that we received, through the five-year review, criticism of the fact that, under this process, we tend to assess a large number of very small projects. Currently, about 6,500 to 7,000 projects per year are assessed. As a result of one of the changes that has been brought about through the standing committee process in the House, we will see that number grow substantially because of the new requirement that Crown corporations be subject to the act.
We are looking at some means of reducing the number in order to focus our resources on those projects that are more important and probably of greater public interest. Before we add anything to the exclusion list, we go through a process of making a determination that that project is likely to have insignificant environmental effects. The conclusion of the review was that is the reason we assessed too many small projects.
With respect to your reference to the comprehensive study list, I believe there was a recommendation in one of this committee's reports a year or so ago about nuclear power plants that had been shut down. One of the commitments the minister made in his report to Parliament is to look at what we call the ``four framework regulations'' on a periodic basis. That would include the comprehensive study list. Probably within the next two years, we will be looking at amendments to that regulation and we will examine your recommendation in that context.
Senator Buchanan: I will move to another level on this. I am not sure whether this act covers what I plan to talk about or not. My big interest, since the early 1980s in Nova Scotia, has been offshore development. As you may know, Mr. Minister, we negotiated and signed the first offshore natural gas and oil agreement in Canada with Prime Minister Trudeau, and now Prime Minister Jean Chrétien when he was Minister of Energy. We covered everything in that agreement, from the Canada-Nova Scotia offshore board to environmental assessments of offshore projects. It has worked very well for the development of Newfoundland oil and Nova Scotia natural gas over the last years.
What effect, if any, will this bill have on offshore projects in Nova Scotia and Newfoundland, which are now administered by the Canada-Nova Scotia offshore board and the Canada-Newfoundland offshore board? Environmental assessments are currently being carried out and have been carried out on all new offshore projects in both provinces. There has been some criticism recently from industry that environmental assessments are holding up the development of new projects.
Will this be another level in environmental assessment of federal-provincial projects, or projects that are now administered by federal-provincial offshore boards for Nova Scotia and Newfoundland?
Mr. Anderson: To the best of my knowledge, there is no change in the position of the joint boards. However, there are some pressures that I would describe as ``political,'' of which I expect you are aware. Permits were issued to the west of Cape Breton and then a study was commissioned because of public concern. There has been some pressure to extend federal assessments in a different way from in the past.
Mr. Connelly could comment further. My general understanding, however, is that we have achieved fairly successful federal-provincial cooperation in the area of environmental assessment. There are about 150 projects a year of 6,500 that require federal-provincial joint assessments or two assessments. We have responded to and accepted 13 of the 18 recommendations from the provinces in this new bill.
The exception has generally been the Province of Quebec, which has refused to take part in any joint environmental assessment, but I can at least report that with respect to the Eastmain project in James Bay, the Cree project there, while we will not have the traditional joint approach, we will have a common approach, with the same timelines and a single set of public hearings on the Eastmain-Rupert hydroelectric project. There will still be two assessments, but the same witnesses will take part in the process in the same room. We have taken a major step forward in the Eastmain- Rupert project in terms of coordination. However, it is not technically a joint approach. Mr. Connelly will add more about the offshore boards and any possible change with respect to assessments.
Mr. Connelly: First, as the minister indicated, the bill will not alter the boards' application of environmental assessment. Both boards are considered to be federal authorities for the purposes of the Canadian Environmental Assessment Act. They are clearly a joint federal-provincial creation, as you correctly indicated, Senator Buchanan, but for purposes of the act, they have been declared federal authorities. This goes back a number of years and originated in Newfoundland. The industry itself did approach us to bring the boards under the act for reasons of certainty.
There was concern at the time that the act could be applied, perhaps through a legal challenge, at the last moment and that would delay a project going through the process. Partly because of that concern from the industry, the decision was taken a few years ago to bring the Newfoundland board under the act as a federal authority.
Senator Buchanan: I think Nova Scotia was, also.
Mr. Connelly: Yes, and Minister Anderson has also declared that board a federal authority, so there is some uniformity.
Senator Buchanan: I have no problem with that.
Mr. Connelly: I think that has worked fairly well. I should point out that there are some regulatory initiatives underway to bring about some greater consistency across the country with respect to offshore oil and gas.
As you can appreciate, the act applies nationally, and so it would deal with oil and gas developments in the Beaufort Sea, or potentially in the Gulf of St. Lawrence, as well as on the East Coast. We are trying to bring some uniformity and consistency to the application of the act, but that is done through regulations and not through any amendment in Bill C-9.
Senator Buchanan: I cannot leave this without mentioning to the minister, as I have before, a section of the 1982 agreement that I negotiated with the former minister and current Prime Minister, Jean Chrétien, on the Crown share. I mentioned to the minister before that I know he is in Nova Scotia and Newfoundland's corner and we will get that Crown share. Is not that right, sir?
Mr. Anderson: Given the fact that you are referring to my boss when you say you have had discussions with the former minister and the current Prime Minister, I think I should leave that to him to determine.
Senator Buchanan: By the way, we negotiated in the Canadiana Grill.
Mr. Anderson: I will make a point of asking him about his recollection of that.
Senator Buchanan: He initialled that and so did I.
Senator Kenny: I have a small point. Minister, you did not give us the timing of your discussions with Quebec. Were they before or after the last election?
Mr. Anderson: This unusual circumstance of a common timeline and single public hearing was the result of an agreement with the previous government, the Parti Québécois. Essentially, we were to operate together and come to, if necessary, different conclusions. I have spoken to Thomas Mulcair, Minister of the Environment, but I have not yet had a meeting with him. We have an opportunity for effective cooperation without offending sensibilities. Perhaps the previous provincial government has pointed the way in this respect.
I did not find that the previous provincial government had difficulty in handling environmental issues. They obviously had a high level of environmental concern.
Senator Kenny: We have come across this file a number of times in this committee and I am intrigued that progress is being made. I do not know how the committee can stay abreast of improved relations with the province vis-à-vis environmental matters, but if you could find a way to help us do that, we would be grateful.
Mr. Anderson: Certainly I could do that. I take this as a positive step. I should mention that there is another case, Kenogami, in which we have been required to come forward with our own hearings. This appears to be a reversal of the old system and was a decision of the former Quebec Minister of the Environment, Mr. Boisclair, made two days after the election. It may be possible for to us reorganize that along the lines of the Eastmain-Rupert proposal and we are hoping to do that. If the Quebec government recognizes the importance of some kind of coordination I am sure it will not be difficult to work something out.
The Chairman: Minister, I think everyone is glad to see that the Crown corporations are now subject to these same regulations. Could you tell us about the rationale for keeping them from coming under the purview of the bill until three years after Royal Assent? Is that time to destroy the evidence or throw stuff overboard? Why the three-year interregnum?
Mr. Anderson: I do hope that your worst suspicions are not well-founded.
The Chairman: I was joking.
Mr. Anderson: We have some 41 Crown corporations and many of them will need a tailored process, because one size does not fit all. The Farm Credit Corporation provides thousands of small loans to family farms and we do not want delays that could cause some economic hardship while, on the other hand, not providing any environmental benefit. Clearly, we have to look at these things one by one.
The other important aspect is to allow a Crown corporation to gain expertise. They have expressed considerable concern over being subjected to regulations that they perceive as appropriate for government but not for their operations because, of course, they are not government, at least in the eyes of some of their directors. We think there will be an opportunity for them to acquire understanding and expertise. When they finally are required to comply three years hence, it will be a more comfortable experience for them.
The Chairman: I love decent intervals. You mentioned that there was ``participant funding,'' in your words. I presume that means there is public support for participation in the process.
Mr. Anderson: Yes, that is correct. It is public money. However, I understand that in certain situations, proponents have provided funding for the use of public interest or environmental groups. Mr. Connelly may know the details of how the funding could be disbursed.
Mr. Connelly: Under the current act, there is a participant funding program for any project at the environmental assessment panel stage. The fund is allocated at the hearing process based on certain criteria and on an application from any group that wishes to participate.
The Chairman: The panel process is the smallest minority of the processes?
Mr. Connelly: That is correct. Bill C-9 also proposes to create a participant funding program for the next level of assessment, the comprehensive study level. That will obviously increase the number of projects for which funding is available to assist people to participate in those reviews.
The Chairman: Does that money come from the proponent of the project or from the public purse?
Mr. Connelly: That comes from the public purse.
The Chairman: Entirely?
Mr. Connelly: Yes.
The Chairman: Would you tell us, minister, about the follow-up programs for larger projects? I did not find that when I read the act. What is the mechanical means by which the follow-up programs for larger projects come into play?
Mr. Anderson: This is a completely new requirement and applies to panels. Mr. Connelly will give us the time frame, but my understanding is that the panel would indicate the appropriate time in the future to undertake a review of whether expectations have been met. Mr. Connelly, is that the correct information? Would the time vary according to the panel's decision?
Mr. Connelly: Yes, minister, that is correct.
The requirement would apply to comprehensive studies as well as panels. The larger projects would require follow- up programs.
What will happen in practice is as the minister has indicated. The timing of the measurement of certain environmental effects will be determined on a case-by-case basis. The idea is to find out whether the predictions in the first instance were accurate. If we find through that process that there are problems, then corrective action can be taken.
The Chairman: Just so we have it on the record, the criterion for determining what is a small project or a big project is the environmental impact? It depends on how big the pipe is or how much land it covers? We need to be sure that we know that. I can make a very small hole somewhere and yet do a great deal of environmental damage.
Mr. Anderson: In fact, senator, the criterion is the expected environmental impact. It is a judgment call. With 6,500 issues coming before the agency annually, there has to be some way of sorting out the cottager's dock from something with a more serious environmental impact. We do not want to hold up the smaller projects unnecessarily.
The Chairman: To be sure that I understand, let us use the example of a large building that is adjudged to have a minimal environmental impact, as opposed to a small project that requires digging near a stream and has a potentially huge environmental impact.
My first example could be a small project and the other could be a big one. Is that right?
Mr. Anderson: That is correct. It would be the expected impact. There is no question that it is a judgment call and that that will sometimes lead to differences of opinion and perhaps requests for a smaller project to be upgraded, and vice versa.
Senator Ringuette: My ears pricked up when you mentioned Farm Credit Corporation. I come from a farming community that is constantly assessing the high risk and the impact of climate change. Can you tell me if Farm Credit Corporation will begin doing environmental assessments of farms when farmers apply for loans? Is that the situation that we are looking at?
Mr. Anderson: There are literally thousands of Farm Credit applications and, indeed, granted loans. I do not know the exact number, but I think it is in the thousands. We expect the vast majority to be automatically approved from an environmental aspect. If the loan is to re-roof the barn, there may be little impact. If, on the other hand, the loan is to be used to change the location of manure storage areas, there might be a question of drainage. That type of issue could come up.
That is why we are having a three-year phase-in period. We want something automatic for two reasons. Delay is the first; credit is not much good if it comes too late. Second, there are extra costs. We do not have to use the full bells-and- whistles study for a new roof on a barn. That should be straightforward.
I think we can work out something with which they will be quite comfortable. The fact is that we lend money on many things. There is no question that on some loans, it is appropriate to have environmental assessments.
Senator Ringuette: That comforts me. I understand that the project requirements will be assessed and approval will not necessarily depend on refinancing. A farmer will not need to face an assessment each time he needs to renew his loan with the Farm Credit Corporation.
Mr. Anderson: I think most projects will require a quick check-off. Of course, some farm projects can have environmental impacts. For instance, a change in a manure pit could contaminate groundwater, which could lead to a situation like Walkerton.
Logically, one has to rely upon common sense. I will not use the term ``legalistic'' with a lawyer sitting next to me, but we cannot be, let us say, inflexible or categorical. Common sense is a necessity here.
Senator Ringuette: I certainly welcome the federal-provincial cooperation on environmental assessment projects. We often must look to the municipalities. Although they are the creatures of the provinces, hopefully they will be invited to participate on specific projects that touch them. People who live in non-incorporated areas rely on provincial governments or local service districts; they should also be invited to participate in the assessment of projects. They have a great deal at stake. Most of our environmental and natural resources are in the hands of non-incorporated rural communities.
Mr. Anderson: That is why it is so important to have good relationships with the provinces, which have direct responsibility for such communities, whether incorporated or unincorporated.
We do try hard. I am genuinely pleased with the level of cooperation we are achieving; it is not perfect. We find cooperation is generally forthcoming when a project requires both a federal and a provincial assessment. Frequently, such assessments are better because more expertise is available when both levels of government are involved.
We are trying to avoid duplication and extra costs. I repeat that it has even been a normal practice in such meetings, with the exception of Quebec, to sign on to the harmonization agreement. However, we are now seeing some encouraging signs that we will be able to stickhandle our way through some of the difficulties with that jurisdiction as well.
I am pleased. Difficulties sometimes arise, of course, because indeed we have people pressing us for a second or separate assessment.
Sometimes we have to disappoint people, who then regard our process as inadequate to protect the environment because we have gone with a provincial-federal joint approach or we have said the provincial approach is adequate and we will be simply there providing information, or even as an intervener.
There are a number of opportunities to work with the provinces, but we recognize that the boundary line between federal environmental jurisdiction and provincial environmental jurisdiction is again, with due respect to the legal experts, flexible, particularly when provincial governments are cutting back so drastically on their budgets for environment departments. The latest cut in my province was 40 per cent. There may be room in that flexible boundary to perhaps give a greater role to the federal government than it otherwise might play. This is not to intrude on provincial jurisdictions, but to simply admit that there are many areas where one or the other can do the job. If there are reductions at the provincial level, we should not always reject the suggestion that we should assist under those circumstances.
Senator Ringuette: As a New Brunswicker, I was disappointed to read in the paper in the last few days the results of a study indicating that New Brunswick is where there are the worst environmental concerns and deterioration of wildlife. I hope that this kind of new cooperation will not only help reduce this but create a certain common environmental standard from one province to another. People who want to put projects together need to be able to look at a certain standard, whether they want to deal with New Brunswick, Nova Scotia or Ontario. That will be happening, I assume, from the cooperation that you will be getting. Thank you.
The Chairman: Thank you very much for being with us again. You have been very generous with your time and most informative. Our deliberations on this bill will continue on Tuesday.
The committee continued in camera.