Proceedings of the Standing Senate Committee on
National Finance
Issue 8 - Evidence - June 8, 2010
OTTAWA, Tuesday, June 8, 2010
The Standing Senate Committee on National Finance met this day at 9:45 a.m. to examine the expenditures set out in Supplementary Estimates (A) for the fiscal year ending March 31, 2011 (topics: Canada's initial response to the earthquake in Haiti; capital projects/equipment; and Canada Media Fund).
Senator Joseph A. Day (Chair) in the chair.
[English]
The Chair: I call the meeting to order and thank the witnesses for their patient understanding while we attended to other matters in camera. We will proceed now with the meeting's public agenda.
[Translation]
Senators, this morning we are going to continue our study of the Supplementary Estimates (A) for the 2010-2011 fiscal year, which are before our committee.
[English]
This is the committee's second meeting concerning the first Supplementary Estimates (A) tabled by the government this fiscal year. In this panel, we will consider two issues, one of which is Canada's response to the earthquake in Haiti. Honourable senators will recall that officials appeared before the committee in March to speak to the previous fiscal year's Supplementary Estimates (C).
We are pleased to welcome from Foreign Affairs and International Trade Canada, DFAIT, Ms. Kerry Buck, Assistant Deputy Minister, Afghanistan Task Force; and Ms. Elissa Golberg, Director General, Stabilization & Reconstruction Task Force — START — Secretariat, whom I last saw in Kandahar. Good to have you here. As well, we welcome back from the Canadian International Development Agency, CIDA, Mr. David Moloney, Executive Vice- President, who is no stranger to this committee; and Ms. Isabelle Bérard, Director General, Haiti and Dominican Republic.
At the committee's meeting in March, these two departments were joined by National Defence, DND, which is here today to speak to the second topic of capital projects and equipment. DND has not requested additional funding in Supplementary Estimates (A) for its response to the earthquake in Haiti, but we have invited them here this morning to speak to their request for $338.7 million for capital projects. We will hear from Mr. Kevin Lindsey, Assistant Deputy Minister, Finance and Corporate Services; Mr. Dan Ross, Assistant Deputy Minister (Materiel); and Rear-Admiral Robert Davidson, Director of Staff, Strategic Joint Staff.
We have allotted one hour for this panel, so I request brevity where possible. We will take statements from each of the department's representatives and then move to questions and answers. Ms. Buck, please proceed.
Kerry Buck, Assistant Deputy Minister, Afghanistan Task Force, Foreign Affairs and International Trade Canada: Although I was the ADM for Afghanistan at the time of the Haiti earthquake, I was responsible for whole-of- government coordination of Canada's response. I am here in that capacity.
[Translation]
The objective of my remarks today is to provide you an update on developments concerning Haiti since my presentation on March 17, and information on the programs of the Department of Foreign Affairs for strengthening justice and security systems in Haiti that are funded by the Global Peace and Security Fund.
[English]
I will begin, Mr. Chair, with the International Donors' Conference Towards a New Future for Haiti, which took place in New York this past March 31. This conference was an opportunity for Canada to demonstrate its commitment to sustained engagement in the long-term reconstruction of Haiti. The co-presidents — namely, Brazil, Canada, the European Union, France, Spain and the U.S. — reached a consensus on a long-term vision for the recovery of the country. The principles adopted at the conference in Montreal helped the international community and the Haitian government to define a clear framework for engagement. These were principles of coordination, sustainability, effectiveness, inclusiveness, accountability and Haitian ownership. The meeting successfully raised almost $10 billion over the next 10 years, and Canada committed over $400 million in addition to our current commitments.
The New York conference also produced two international coordination mechanisms: the Multi-Donor Trust Fund and the Interim Haiti Recovery Commission, IHRC. This commission will soon be kicked off with its first steering committee meeting expected to be held within the next two weeks. These mechanisms will align international assistance with the priorities set by the Government of Haiti and will ensure transparency and accountability.
More recently, the Minister of Foreign Affairs, the Honourable Lawrence Cannon, visited Haiti from May 5 to 7. During this visit, Minister Cannon met with Haitian authorities to receive an overview of the situation on the ground to better assess the Canadian response to the earthquake and the way forward for Canadian engagement.
To provide you some context, 2010 promises to be a turning point for Haiti's future with an impact on Canada's programming.
Elections will be held in November, and their results, while hard to predict, will be decisive for the Government of Haiti and for the reconstruction agenda. We will closely monitor the political trends and the governance issues around the electoral process. While relatively stable and under control, the security situation in Haiti remains fragile, with recent protests fomented by opposition parties against President Préval. Such incidents shed light on the ongoing political posturing occurring behind the scenes, which will only intensify in the coming months.
We have worked hard to adapt our programming to new conditions in Haiti with the principles put forward at the Montreal conference. To give you a few examples, DFAIT contributed to financing the law, justice and security component of the Post-Disaster Needs Assessment, PDNA, which was conducted by the Haitian government and the United Nations. DFAIT's START programming deployed experts from the Royal Canadian Mounted Police — RCMP — and Correctional Service of Canada. Drawing on the needs assessment and the action plan presented by the Haitian government in New York, the security and justice sectors were identified as priorities. DFAIT then worked to reorient our programming based on the results of the needs assessment and the action plan to ensure that it contributes to building capacity in the security sector in Haiti.
Overall, START has allocated $51 million for security system reform projects in Haiti, and following the earthquake, which according to the PDNA caused damage and losses of $7.8 billion, the challenges of recovery are greater than ever. Numerous Haitian police officers are still unaccounted for, including several high-ranking officers. Many public buildings collapsed or were seriously damaged, including the building housing the Haitian Ministry of Justice and Public Security. Damage to prison infrastructure and the escape of almost 60 per cent of the prison population has an impact on the security situation and security of communities.
START's funding envelope has therefore been increased to $25 million for the year 2010-11. We will intensify our engagement in our traditional sectors, namely, police reform, prison management and border management. We will also increase our support to community security and expand interventions in the justice sector. With this program, we will ensure that we are building in longer-term capacity for disaster response and disaster-risk reduction. Two examples are international standards for earthquake resilience in infrastructure construction — the buildings that we are building — and providing first-aid training for police officers.
I will conclude with a brief summary of our contributions in these sectors. With respect to police, we are strengthening the Haitian National Police. We have approved the deployment of additional police officers to the United Nations Stabilization Mission in Haiti, MINUSTAH, whose task is to train their Haitian counterparts, and by August the total number of Canadian police deployed will be up to 150. We provided 100 trucks and 100 motorcycles. We have a prominent role in border management, including maritime borders, primarily through providing equipment, infrastructure and training.
On prison system reform, we are undertaking renovation and construction of detention facilities. Minister Cannon visited the Croix-des-Bouquets prison, a major facility that should be operational by the end of the year. Up to 25 Correctional Service of Canada officers are being deployed to MINUSTAH to assist in prison management to ensure that the approaches are effective and more respectful of human rights.
We are also increasingly engaged in community security through initiatives that offer work and training to citizens. These initiatives are undertaken in coordination with Brazil.
Finally, we will be supporting initiatives to establish emergency justice procedures and help restore the foundations of a functional justice system, for instance, a frontline justice program implemented by Lawyers Without Borders.
In addition to programming initiatives, we have also incurred significant expenses to put the embassy back into operation to offer temporary accommodations, additional operating expenses and capital property to ensure it is able to withstand seismic tremors. You will recall when I was last here that in the immediate post-quake period our embassy staff was working out of the garage. We had hundreds of staff and Canadian evacuees tenting on the grounds of the embassy and living outdoors. A significant amount of work has been done to put the embassy back into operation and to ensure it is more sustainable over the long term.
Those amounts — $1.7 million for trailers on the embassy compound, $1.5 million on repairs and maintenance to the embassy and staff quarters, $3.64 million budgeted for repair of the chancery and collocation of chancery and residences — are examples of the overall spending that we have incurred to put the embassy back into operation.
It is fair to say that five months after the earthquake, justice and security system reform are more than ever the core of our Canadian engagement, and as we move from the early recovery phase to the development phase, humanitarian needs continue to be pressing. We are committed to maintaining our sustained efforts.
The Chair: Thank you. We will hear from Mr. Moloney next.
[Translation]
David Moloney, Executive Vice-President, Canadian International Development Agency: Honourable senators, thank you for the opportunity to discuss the Supplementary Estimates (A) for the Canadian International Development Agency, especially as how they relate to Canada's response to the earthquake in Haiti.
Before taking your questions, I would like to briefly summarize what Canada has done so far to help in the ongoing rehabilitation efforts in Haiti since this terrible tragedy.
Shortly after the earthquake, the Government of Canada provided $85 million in humanitarian assistance to those affected by the disaster by working with trusted and experienced organizations.
In recognition of the tremendous generosity shown by Canadians in the weeks that followed the earthquake, the Government of Canada committed to match eligible donations by Canadians. As a result, the government committed $220 million to the Haiti Earthquake Relief Fund.
[English]
At the International Donors' Conference Towards a New Future for Haiti at the United Nations, which took place on March 31, Canada pledged, as Ms. Buck said, $400 million over two years in new and additional funds for humanitarian and reconstruction programs in Haiti. That commitment included planned spending totalling about one half, or $110 million, of the Haiti Earthquake Relief Fund.
On April 8, Minister Oda announced that an additional $65 million from the Haiti Earthquake Relief Fund would go immediately toward continuing relief and early recovery needs. These included transitory shelter and rubble removal, water and sanitation, child protection and education, logistics and coordination of the international humanitarian response.
These funds were provided to the Canadian Red Cross and the International Federation of the Red Cross and Red Crescent Societies, as well as to UN and Canadian non-governmental organizations for humanitarian assistance.
These commitments are in addition to Canada's $555 million engagement for 2006 to 2011 in Haiti. In fact, various already operational bilateral projects are being used to provide further support to the earthquake recovery, reconstruction and long-term development efforts, including initiatives in the micro-finance, rural development, agricultural and health sectors.
For example, in April, Minister Oda signed a $20 million memorandum of understanding in Port-au-Prince with the Government of Haiti to support the construction of a provincial hospital in Gonaïves. The hospital is a high priority for the Government of Haiti, and Canada's contribution represents an important step in rebuilding the city of Gonaïves' main health services, in line with the Haitian government's action plan. We have also accelerated disbursement for an ongoing electricity project in Jacmel so that local electricity needs can be met 24 hours a day, 7 days a week.
Further, Minister Oda announced $18.1 million in funding for the National Police Academy in the city of Ganthier, near the capital of Port-au-Prince. The project will build the infrastructure and provide the equipment to train Haitian National Police inspectors and commissioners.
Mr. Chair, CIDA continues to respond effectively to the widespread devastation caused by the earthquake by cooperating closely with other Government of Canada departments and agencies, including those with us here today, as well as with other donor countries and the Government of Haiti. Decisions on future CIDA programming will be based on the priorities set out in the Haitian government's action plan. In that context, I would also note that Canada will be a member of the Interim Haiti Recovery Commission, which has been created by the Government of Haiti to facilitate the coordination of international aid and cooperation. The commission will meet formally for the first time next week in Port-au-Prince.
As the main federal government agency responsible for international assistance, CIDA continues to work with trusted partners to do everything possible to ensure that Canada's response to this disaster is effective and meets the needs of the people of Haiti.
I look forward to your questions.
The Chair: Thank you, Mr. Moloney. We will now call on National Defence for comments. National Defence has not asked for further funding in Supplementary Estimates (A), from the point of view of incremental costs for Haiti, but there is a request for $338.7 million in funding for capital projects.
I believe that you would like to comment in that regard. We would welcome your comments, Mr. Lindsey.
Kevin Lindsey, Assistant Deputy Minister, Finance and Corporate Services, National Defence: It was suggested to us that we not take up your time with prepared remarks this morning. We are quite prepared to go straight to questions on that capital item in the estimates.
I would point out, by way of background, that that $339 million was all money approved in previous estimates in previous fiscal years. For a variety of circumstances the cash flow requirements for a number of projects has changed. This reflects an update to the cash flow requirements for a number of projects, cash required in 2010-11.
The Chair: Mr. Lindsey, these funds are not being requested for one or two major projects. It is normal business as usual in relation to many different projects; is that correct?
Mr. Lindsey: Several projects are affected, some large procurement projects as well as 17 infrastructure projects. My colleague, Mr. Ross, could expand on the procurement projects affected, and, if the committee is interested, I could briefly talk to the 17 infrastructure projects for which funding is requested.
The Chair: Thank you. Honourable senators know who to go to if they wish to pose questions in that regard.
Senator Gerstein: Thank you for appearing before us today, witnesses.
In response to the earthquake in Haiti, as I understand it, the government said that it would match every dollar that Canadians donated between the time of the earthquake and February 12.
As I recall, the last time you were here, you indicated the amount contributed by Canadians was $128 million. Could you kindly give us an update on the most recent number?
Mr. Moloney: As I indicated in my opening remarks, the final tally of Canadian eligible donations made between the period January 12 and February 12 was $220 million.
Senator Gerstein: That figure was $220 million; is that correct?
Mr. Moloney: Yes. This is over and above the partial estimate that was provided by the president of CIDA, Margaret Biggs, before the committee at the time of the Supplementary Estimates (C). CIDA needed to go through a process of due diligence with the few hundreds of organizations that collected eligible donations and provided us with statements. We then had a process of reconciling those various statements. The final number is $220 million.
Senator Gerstein: I am trying to track through some of the numbers that you have given us.
How much of the $220 million has been matched by the Canadian government? Has the $220 million been matched so that it takes you to $440 million?
Mr. Moloney: It is complicated.
Senator Gerstein: It is.
Mr. Moloney: Included in the $400 million of new commitments that the government made on March 31 was about one half of the planned spending through the Haiti Earthquake Relief Fund, the $220 million. The government was clear on March 31, Minister Oda and colleagues, that to be eligible for matching purposes the government would not count payments that would be made through, for example, international financial institutions such as the proposed Multi-Donor Trust Fund at The World Bank. Funds for those sorts of purposes were included in the $400 million, however.
On March 31, the government had planned specifically just less than one half, just less than $110 million. One week later, on April 8, Minister Oda then announced a further $65 million for humanitarian and early recovery purposes out of the matching funds. Between those two announcements, we have something close to $175 million having been committed toward the $220 million.
Senator Gerstein: Take me, if you will, from that to the $550 million that you referred to that has been committed between 2006 and 2011. Is that part of the $550 million?
Mr. Moloney: None of it is in the $550 million. That was why I made the point in my opening remarks that the $400 million is new and additional funds for Haiti. By that, we mean going beyond the $555 million that the government had committed to provide to Haiti or for development and assistance to Haiti between 2006 and 2011. It was also additional to the initial $85 million of response that had already been put in place.
Senator Gerstein: You further remarked on $18 million that was being allocated, for example, to the police academy, et cetera. Is that, again, an additional number, or is that included in the numbers that you have given us?
Mr. Moloney: That would be inside the $555 million. Those were funds, part of our existing programming through the delivery on the $555 million, some of which were moved to other more pressing purposes and some of which were for the planned construction of a police college. That work was accelerated and announced in April.
Senator Gerstein: Mr. Moloney, it might be of help to the committee if you were to prepare a chart that indicates the various stages that commitments were made and the public contributions on the other side so that we have a better perspective. If that could be filed with the clerk, it might be helpful to a number of us on the committee who have not followed the numbers as quickly as you have given them.
Mr. Moloney: Certainly, I think we can do that.
Senator Gerstein: Thank you very much.
The Chair: Many of us are struggling with these numbers and how you have taken pieces out of different ones. We are all very proud of the way that Canadians responded, and we would like to trace that through to ensure that it is being used properly and as intended.
Senator Callbeck: Thank you all for coming here this morning.
Continuing on with the costs, you mentioned that on March 31 there was $400 million in new funds. That was on top of the $550 million that had been announced previously to take place in 2006 to 2011. That is $950 million. Is that the total, or is there more on top of that?
Mr. Moloney: The funding that would be additional to that was the government's initial $85 million in humanitarian assistance. The $400 million was drawn out of resources from last fiscal year, the 2009-10 fiscal year, a portion of which you had under review through Supplementary Estimates (C). The $400 million is new and additional funding in the current fiscal year, 2010-11, and the next fiscal year, 2011-12.
If you were trying to add up a total number, you would want, over six years, the $555 million, plus the $85 million of humanitarian assistance in the initial response, and then the further commitment of $400 million over two years.
Senator Callbeck: Is the $220 million that Canadians gave on top of these figures that you have given us, or is that included?
Mr. Moloney: As I said, a portion of that is in addition; $110 million of that is in addition. The $400 million included half of the matching funds; the other half is in addition.
Senator Callbeck: What is the total figure all together?
Mr. Moloney: The total figure, in terms of Canada's response to the earthquake, which is how we have been focusing on this, is the initial $85 million, plus $400 million, plus a further $110 million, which is the remaining portion of the matching funds not specifically included in the $400 million.
Senator Callbeck: That is hard to follow.
The Chair: Perhaps we should receive a chart on this.
Mr. Moloney: We will put it down on paper.
Senator Callbeck: That would be fine.
Mr. Moloney, I want to ask you about the initiatives you spoke about in Haiti, one of which is in micro-finance. Can you talk about that, please?
Mr. Moloney: Perhaps I will turn to my colleague, Ms. Bérard.
Isabelle Bérard, Director General, Haiti and Dominican Republic, Canadian International Development Agency: We have a number of activities in the micro-finance sector, mostly done through Développement international Desjardins. A network was put in place in Haiti about 18 or 20 years ago, and we have been supporting this micro-finance network for a number of years. This network has been very successful. More than half of the clients who benefit from the micro- finance support are women, and they benefit immensely from those initiatives. Luckily, after the earthquake, only three cooperatives were destroyed. Essentially, the full network was still functioning after the earthquake, and this allowed people to have rapid access to support.
The Chair: As a follow-up, Mr. Moloney, when you are preparing your chart for us, will you tie in the $70 million that CIDA has requested in these particular Supplementary Estimates (A) and show how that fits in with the other figures that you are giving us?
Mr. Moloney: Certainly. The $70 million is the amount that the government is seeking to ensure that we can deliver this year's elements of the $400-million commitment.
The Chair: This is $70 million out of the $400 million, and then we will see the balance requested in future years. Is that correct?
Mr. Moloney: The government has not yet decided whether it would need to seek any additional funds or whether we can work out of existing levels.
The Chair: For honourable senators' information, at page 58 of our Supplementary Estimates (A) is a horizontal item showing the various departments and the amounts that they are requesting in the Supplementary Estimates (A). That is what we will be requested to vote on in the next few weeks.
Senator Runciman: Canada had a long-term commitment to Haiti prior to the earthquake. My question is for Ms. Buck. You spoke about a commitment to sustained engagement and then you referenced a long-term vision and the monies that will flow over the next four years. When you talk about sustained engagement and long term, what are you talking about not only the international commitment but also, in particular, Canada's commitment? What type of timeline are you suggesting here?
Ms. Buck: "Sustained engagement'' means two things. First, Canada has for a long time been one of the primary countries in the hemisphere engaged in Haiti. We have long roots and ties, and we have a proud record of good relations with the Haitian people. That is the context for the Canadian longer-term sustainable engagement. There is no definite timeline on that. This is something that we have been doing over decades and will continue to do.
In advance of the Montreal conference, the Prime Minister gave a clear signal to the international community and the Haitian government that Canada — at least, at the Montreal conference and coming into the New York conference — wanted to ensure that the engagement of the international community would not just be one quick hit of financing into Haiti and then stepping back. That is a mistake that can be made with respect to donor response after natural disasters.
We wanted to send a clear signal. The Prime Minister, at that time, talked about a 10-year engagement, which was to set the tone for the international community discussions and their contributions to Haiti to avoid the pitfall of coming in with a large amount of money early on and then stepping back.
Our commitment of the new $400 million was over two fiscal years, but those are new resources. However, of course, our programming is multi-year programming in Haiti with clear benchmarks and results for not just the short- term response to the quake but longer-term reconstruction as well.
Senator Runciman: I wonder about those benchmarks. I can see that when you are rebuilding in the aftermath of the earthquake and with the infrastructure monies, benchmarks are readily identifiable. However, other issues exist. You spoke about the justice system. On police involvement and training, Canada's involvement has been ongoing for years in Haiti with, I would suggest, not much success because areas and neighbourhoods still exist where you would not want to venture into without appropriate security.
I am curious about how you will benchmark those types of things. You made a comment that I have not heard reported. I think you said that 60 per cent of the prison population escaped. I am curious how many of those have been recaptured. Are you aware of that number?
Ms. Buck: Yes. I will speak about benchmarks for the security sector; Mr. Moloney may wish to speak about results measurements for CIDA programming.
Prior to the quake, the international community was in agreement that there had been significant improvements and developments in Haiti. Now the situation is not perfect. Pockets of insecurity continue to exist, absolutely, but there had been some significant improvement just prior to the quake. The quake set everything back, but the aim of the international community was to build on the progress that we had achieved just prior to the quake. This is possible in Haiti, and we have seen it work.
In terms of benchmarks and security-sector reform, we are working with the UN to ensure that the international community is striving to achieve some of the same qualitative benchmarks. We are all singing from the same song sheet and measuring the same parameters. We measure parameters such as the number of fully trained police officers who meet police benchmarks coming out of police academies and respecting international standards for appropriate treatment of prisoners in Haitian prisons, et cetera. We have a robust system to measure results. It does not always work, but it works much of the time.
With respect to recapturing prisoners, some have been recaptured. I would have to check to provide you with statistics on how many have been repatriated to prisons. Some institutions has some success while other institutions were demolished. Capturing those escaped prisoners and returning them to the prisons has not happened yet. We will provide the statistics that are available on that.
Senator Runciman: I am a bit of a pessimist since Canada has been making these significant investments for many years. You say that improvements have been made, but I think there is no light at the end of the tunnel in terms of Canada's continued involvement. Maybe that is desirable since they are part of the area that involves this country to a significant extent.
These are bigger questions when we talk about the viability of Haiti as a nation. My primary concern is Canadian dollars beyond infrastructure and rebuilding of the country — the long-term investments that we make as taxpayers. We need benchmark measurements to assure Canadians that those dollars are being used appropriately.
[Translation]
Senator Poulin: Thank you very much for your respective presentations, which were very interesting.
At the time of this disaster in Haiti, one of the comments I often heard from Canadians was that they were willing to be moved as long as they had news bulletins in front of their eyes. So the great danger we now face is that there is no more media coverage of the situation in Haiti. So it is easy to forget and to underestimate the relevance of our cooperation in international aid and our responsibility as a country to Haiti.
As Ms. Buck said, Canada has for a number of years invested by providing products, services and expertise for the ongoing development of that country. I very much appreciated your presentation. Would it be possible to have a paper copy of it? You could send it to the clerk.
Ms. Buck: Pardon me. As a result of the last-minute changes, we were unable to distribute a copy to all members before the meeting, but it will be ready for distribution approximately 15 minutes after the meeting ends.
Senator Poulin: Thank you. My concern is the efficiency of our management. I do not want to dwell on exact figures but rather on efficiency. In the documents that committee members received, I noticed that a number of Canadian departments are involved in the Haiti file. Who coordinates all this work? Is it one department in particular, the Department of Foreign Affairs and International Trade Canada, CIDA or the Privy Council Office?
Ms. Buck: There are two answers to that. A system has been in place for a number of years to respond to disasters such as earthquakes. This system is directed by the Department of Foreign Affairs, which acts as leader of a number of participating departments. There is close coordination with the Department of National Defence and with CIDA. About 11 or 12 other departments were also involved.
Following the earthquake, we met twice a day for a number of weeks, including weekends.
So the first stage is the response to the earthquake, coordination under the aegis of the Department of Foreign Affairs, with the participation of a number of other parties, including the provinces and the private sector through the relationships we have built with parties outside government.
As for development, assistance and reconstruction, a committee ensures that a pan-governmental program is in place, which includes most of the same players, and which is directed by the director general responsible for Haiti and Latin America, a program that is closely co-chaired with CIDA.
Senator Poulin: Will that coordination mechanism directed by the Department of Foreign Affairs remain in place in subsequent years?
[English]
Ms. Buck: These are standard operating procedures that have been in place for a long time. After every major disaster, we do a lessons-learned exercise to determine if procedures are working well and what we need to fix. We are currently doing the lessons-learned exercise post-Haiti. However, we do the exercise after every major event. We did it after the Indian Ocean tsunami, et cetera.
We tweak standard operating procedures, SOPs, every time to make improvements, but they have withstood the test of time. They ensure that we provide coordinated policy advice to the political level and that we coordinate our operations on the ground, which are incredibly complicated, as you might imagine. We coordinate not only the Canadian effort across a number of actors, but with other donors and the UN on the ground. We recognize the need for a UN primary-coordinating role and the need to respond to actual needs on the ground. It is not what we have to deploy; it is what they need on the ground that we can deploy.
That practice has worked extremely well. I have seen it grow over the years. It is safe to say that the SOPs will be with us for a while. We will continue to improve them after each and every disaster.
[Translation]
Senator Poulin: We nevertheless have a team in the field together with the ambassador. Can you remind us who the current ambassador is? How many people do we have on the ground? And what can we expect from the team on site?
[English]
Ms. Buck: Our ambassador, our head of mission, is Mr. Gilles Rivard, who was present during the Haiti quake. As is the case with all ambassadors, he is there as a whole-of-government asset. He has a team that includes DFAIT, CIDA and Citizenship and Immigration Canada, CIC.
During the time of the quake, the team included literally thousands of others from National Defence and liaison officers. Canada deployed many civilians and Canadian Forces after the earthquake. Mr. Rivard headed that effort, and he is still there doing an excellent job. We forget that only five months have passed since the earthquake. Much work is ongoing. He has excellent relations with the Haitian government that have been extremely useful and important for Canada as we move forward to ensure that we work with their plan.
Senator Marshall: I want to return to the funding level, Mr. Moloney. We talk about $1 billion, give or take $100 million. I know some money is given to organizations such as the Canadian Red Cross. How are the funds allocated? Is it to specific projects and non-governmental organizations?
Mr. Moloney: The specific partners that CIDA will work with reflect the nature of the programming. Prior to the earthquake, we were delivering $555 million at about $100 million per year, none of which was going directly to the government. We were working with Canadian NGOs, who have local partners. For example, Ms. Bérard spoke to the Développement international Desjardins, which works with a network of local co-ops.
Senator Marshall: Would this be comparable to the Canadian Red Cross or the Salvation Army?
Mr. Moloney: In addition to that, with some specific programs, we would work with the United Nations World Food Programme as a UN agency. When it comes to the humanitarian assistance, which we are doing now, that shifts more toward the various UN organizations, such as the Office for the Coordination of Humanitarian Affairs, OCHA; the World Food Programme, for emergency food; the Red Cross in the International Federation of Red Cross and Red Crescent Societies; as well as other Canadian and international NGOs, such as CARE Canada, World Vision Canada and so on. With respect to the construction elements, in some cases, CIDA would work directly with partners for requests for proposals, and some private-sector firms would be involved in the delivery of those contracts. It varies depending on the elements.
Senator Marshall: Obviously large amounts of money are going out to some of these organizations, so some type of accountability framework must be in place or some requirement that they meet certain deliverables and report back to your organization. Would that be correct?
Mr. Moloney: There is what we consider to be a very robust accountability framework. The Treasury Board of Canada Secretariat has put requirements in place such that any specific program has risk-based audit and accountability frameworks. We have clear metrics and benchmarks for what is to be achieved for any specific contribution agreement, and ongoing reporting is a substantial portion. CIDA has seven Canadian-based employees on the ground in Haiti on an ongoing basis. We have a further five employees locally engaged. In addition to dialogue with the government and local community, an important part of their work is monitoring the ongoing activity. As well, we require formal evaluations and audits at the end.
Senator Marshall: On the $1 billion that we are talking about now, can you share with us whether there is more to come? We are examining Supplementary Estimates (A), which include a certain amount of funding; and we expect to see soon Supplementary Estimates (B) and Supplementary Estimates (C). Can you share anything with the committee on what we can expect down the road?
Mr. Moloney: The government has not taken a decision as to whether it would need to ask for additional resources from Parliament at this time for that purpose. We have spoken a number of times here about the crisis pool, which is an existing element in the fiscal framework. The $70 million requested for CIDA in Supplementary Estimates (A) is drawn from the crisis pool. There remains a substantial crisis pool in the fiscal framework, which would be allocated or not allocated depending on developments. Hopefully all goes well, and we do not have any further events such as earthquakes or hurricanes, in which case we would not come forward for crisis pool access. The government will have to take that through the course of the year.
Senator Marshall: My question is for National Defence and relates to the request for funding in the amount of $338 million. The Supplementary Estimates (A) lists two specific projects plus 17 additional projects. The implication is that all of the projects were announced in the budget for fiscal year 2005-2006, but I do not know if that is correct. Have those been provided for in every budget since 2005-2006? Why has it been five years?
Dan Ross, Assistant Deputy Minister (Materiel), National Defence: Perhaps I could provide some context. It is for a large number of projects, not just in that budget year but as announced in subsequent budget years. This is a routine cash-profiling process. When individual projects are brought forward initially, we base our cash-phasing estimates — how much we would have to spend on a contract on an annual basis — on the best information available. With the initial approval from Treasury Board, that is often based on information from potential suppliers, although we might not have selected a contractor and signed the contract.
As contracts are finalized or negotiated and signed and actual delivery schedules are confirmed and solidified, the predicted cash phasing is rarely exactly the same as the actual cash spending. A number of factors influence the difference. For example, currency exchange rates with the United States will result in lower expenditures on contracts in place that take deliveries from U.S. suppliers. Another factor can be changes to delivery dates of items that have to be paid for on delivery, which happened when our Hercules arrived last Friday — six months early. In some cases, we do not require the contingencies that we have allocated to these projects. We normally have a contingency fund of at least 10 per cent for unforeseen complexities in projects. We rarely use that, and, as deliveries are completed, we return that investment cash requirement to the Department of Finance.
It is a fairly long list. We could give the committee the details of those by dollar values, both pluses and minuses. It is our investment-planning process with the Department of Finance.
Senator Marshall: It just rolls on. When you read that it was provided for in a budget five years ago but the money was not spent, you have to ask what happened to that money. If it is provided for in the next budget and the money was not spent from the first budget, you begin to wonder about budgetary control.
Mr. Ross: It is probably not correct to say that it was not spent. It is correct to say that the specific amount initially predicted was not spent as planned. There would be a variance of additional money or less money to match the actual contract delivery schedule.
Senator Murray: As Senator Poulin indicated, the world has a very short attention span and the media moves on. I must confess that this is the first time that I have focused on Haiti since the last time the witnesses appeared here.
Thousands of people were left homeless. What progress is being made to rehouse people in something other than temporary refuges? How many kids are back at school? How many schools have been rebuilt? There were grave dangers of the most dreadful diseases sweeping the island. Have those dangers passed? What is being done for what needs to be done in the area of health? Ms. Buck referred to the destruction of government buildings and, I would say, the virtual breakdown of civil authority in Haiti. Senator Runciman asked some questions about that. I want to know who is in charge in Haiti. I know the legal answer in terms of the civil authority; but who really has the last word? Is it the United Nations? Is it the United States?
I remember in the early days the United States had to take over the authority for air traffic in and out of Haiti, for example. Who has the last word on priorities, economically, physically, socially and politically?
Mr. Moloney: Certainly the Government of Canada has been clear from the Montreal conference, which took place on January 25, through to the New York pledging conference on March 31 that the Government of Haiti needs to be in charge. It is the Government of Haiti, as the duly-elected representatives of the people of Haiti, that needs to be positioned, needs to have its capacity reinforced, to ensure that the reconstruction — and, in fact, building a better Haiti than existed pre-earthquake — responds to the priorities of Haitians. All of our work has been very specifically aligned that way, and I must say that the broader donor community has been working very much that way.
The UN does continue to have a robust mission there. They refer to it as MINUSTAH. That provides support on the security side, and Ms. Buck could speak to that, if you wish. Other international military forces — other countries — are there reinforcing the powers of the state in a military sense; but there is an elected president, there is a prime minister, parliament was sitting, and its mandate continued beyond the earthquake. Elections are planned for late in the year, and the international community has been supporting — Canada has been supporting, with others — the operation of those elections in the past.
For specific needs on the ground, to help reinforce the capacity of the government to stand itself back up — they did not lose any ministers, but certainly a substantial portion of the civil service was killed — the Government of Canada has provided, announced by the Prime Minister and Minister Oda, the ability to stand up the central agencies of government and this new commission as well as ministries of health and agricultural, which are critical. CIDA has funded and a Canadian firm has provided large office structures. Those are up and running.
As of yesterday, the Interim Haiti Recovery Commission had an office up and running in a tent provided by Canada. We are talking about a tent that can accommodate 100 work spaces, computers and lights. It was delivered in full.
For shelter, every person that was in need of immediate emergency shelter has had a tent or a tarp provided since March. The preoccupation now is to get those people into something sturdier that will withstand the weather. The Caribbean hurricane season is officially under way. Funds have been committed by the donor community for, I believe, 105,000 transitional shelters, each of which would shelter a family. Only about a thousand of those have actually been put in place.
There were two needs. One is removing rubble and providing space, and that was why, in our April announcement, the largest amount of money was toward rubble removal. That is under way.
The second need is to clarify, in some cases, the legal ownership of land, where houses or other buildings had been destroyed. The inadequacy of their land-registration system has been one of Haiti's weaknesses for decades now. The Government of Haiti is now putting a strong focus on that. That is one of the core top priorities of this new commission, which is being stood up as we speak. The commission is majority Haitian-controlled, has a UN- nominated co-president — and former President Clinton is the UN Secretary-General's nominee for that co-chair — and the major donors, including Canada. Therefore, we will be coordinating that aid.
With respect to education, another important part of what we have been doing is to get children back into temporary schools. We do not have a figure for reconstructed schools; it is too soon. We have also put a strong focus on health in terms of diseases.
The Canadian Forces, as I am sure senators are aware, were directly providing health services in the early days. CIDA and Norway have co-funded a field hospital. We are now working on further health services provided through the Red Cross.
There is no doubt that it remains an urgent situation. We do have some hundreds of thousands of people in camps, which are organized, have delivery of services, but of course are, as you are suggesting, risky places should there be spread of disease. That is why we do need to try to get these people out of these camps, out of tents and into something that is closer to permanent shelter.
Ms. Buck: If I may add two points. You asked who has the last word on priorities. March 31, the Haitian government delivered its action plan to New York. It was a very good action plan, done by a government under duress, a government that was operating, as Mr. Moloney said, out of tents. That has been the blueprint for the action and for all of the donations and commitments since then. They are calling the priorities.
The second point is that it is important that the Haitian government is visibly leading delivery of services and operations, visible to the Haitian people. They are obviously not 100 per cent there. No government could be, following the devastation of an earthquake of this magnitude.
However, if you look at the security sector, for instance, within about three weeks of the quake, we had Haitian National Police out on the streets and visibly leading operations. They were backstopped and supported by MINUSTAH police, but the point was to have them doing their police work out in front. It was an important political signal.
Our RCMP is there as high-level, elite trainers to build the Haitian police capacity. That is the Canadian niche. We are good at it; our police are good at it; and we have long-standing ties. We are funding creation of temporary classrooms for Haitian National Police officers and for corrections officers. We are funding new vehicles that will arrive in September, and so on.
This is the Canadian niche, to help put the Haitian government out there visibly delivering security to the Haitian people. MINUSTAH is big. Many military are still deployed, about 9,000, and several thousand police. However, as I said, the Canadian niche is to build the capacity of the Haitian police to be out there and visible.
The Chair: Thank you very much. Honourable senators, our time is up, but I do have three people on my list. I would like to get to the questions of these three senators, and you, as witnesses, could make note of the questions. If you can answer them very quickly following all of the questions, that would be fine, otherwise if you could provide us with a written reply that would be very helpful to us in the work we are doing.
Senator Finley: I have a short question, to which I would expect a very short answer. I have heard many adjectives used to describe the Haitian effort today: brilliant, wonderful, first class, really good, et cetera. You have identified benchmarks in a list. Is there a compendium of quantifiable benchmarks or metrics for this project that we can see, that we can have access to?
I have asked this next question before and still have not received, in my view, an answer to it. Who measures the managers? In other words, you tell me people from CIDA are monitoring what is happening on the ground. They are measuring results. Who is measuring CIDA? You are managing the program, in effect. That is my question.
The Chair: If you would make note of that question. We now turn to Senator Ringuette.
Senator Ringuette: Thank you, chair. Mr. Moloney, it is nice to see you again. I hope are you happy in your new duties.
My question is for National Defence. I am somewhat dismayed that, from my perspective, National Defence is always a very organized entity, and you are here this morning requesting us to approve $338 million, yet we do not even have a sheet of paper from your presentation to justify this. Therefore, I would like to know what are the different projects or equipment purchases to justify these millions of dollars. Was there procurement, and when were they called? Was it an open or closed competition? In the different fiscal year, what cash flow, as you say, has been disbursed, and what is the expected cash-flow disbursement for the future for these projects? Thank you very much.
Senator Dickson: Following up on Senator Ringuette's question relating to National Defence, I have a general question. I read some discussion or some people were putting forward the idea that Public Works and Government Services Canada, PWGSC, rather than National Defence should be involved in the purchasing process to acquire equipment. I would like your general impression, if you could answer in writing. That is my question to National Defence.
Turning now to Haiti for a moment, I have three quick questions there. First, when was the Auditor General last in to visit CIDA, and what were her comments? If she made any recommendations, have they all been implemented?
Second, I can appreciate that the Haitian government has the action plan and that they want to be seen to get the benefit. My concern — and I am sure it is that of other senators, the government naturally and particularly those Canadians who contributed tens of millions of dollars voluntarily — is that we, as this committee, have a responsibility that Canadians are getting value for their money. Where do we fit in the process as far as funding? Is it against work completed? What are the legal obligations? It is fuzzy to me. I want to ensure that, at the end — whenever that is of a particular project — we can choose a project and see results on the ground,.
The last question is about land titles. I come from Nova Scotia. I think that agencies and the private sector in Nova Scotia have done work for CIDA. I may be mistaken here, but I know that they have done work overseas insofar as setting up land-registry systems. I would like to know whether these companies and agencies from Nova Scotia are getting a shot at providing services to the Haitians as far as their land-registry expertise is concerned.
The Chair: Thank you, Senator Dickson.
Senator Ringuette: I have another question.
The Chair: All right. Put it on the record.
Senator Ringuette: This question is to each and every one of you. It seems that there is this system called MEP, the message event proposal, centred at the Privy Council Office and the Office of Prime Minister. I would like to know if any one of you, individually or collectively, have been subjected to this MEP prior to coming to what probably is an event this morning before us.
The Chair: Senator Poulin, do you have a short question to ask?
[Translation]
Senator Poulin: I have a question again concerning management, but this time my question concerns international management. We talked about the Interim Haiti Recovery Commission. I would like to know who Canada's representatives are. What is the decision-making mechanism? And how is our team on the ground involved in the Commission?
[English]
Senator Callbeck: In the estimates in 2009-10, a chart showed the incremental funding for Afghanistan. It showed what the six departments contributed to the task force coordinating Canada's involvement in Afghanistan, and I found it very helpful. It is not in the estimates here for 2010-11. Why is that?
When National Defence was here a year ago, I brought up that the Auditor General's report mentioned that National Defence's commitment to improve financial management remained unfulfilled. Mr. Jacobson, at the time, said that he thought it would take three to four years to do this. Are you satisfied with the progress that has been made? Do you know when the Auditor General will be looking at this again?
The Chair: If you can provide answers to any of those questions promptly, it would be very much appreciated. We want to submit a report on our observations in relation to Supplementary Estimates (A).
Senator Gerstein has the final word.
Senator Gerstein: Senator Ringuette asked a very specific question about whether or not anyone on the panel had been subject to an MEP, whatever that is, prior to coming to this meeting; and I suspect it could be answered by either a yes or no so that we do not have to stay in suspense.
Senator Murray: Also, do they know what headline they are expecting to get from this meeting?
Senator Gerstein: Could we have a yes or no answer so that we are not in suspense?
The Chair: If it is a maybe, do not answer.
Mr. Moloney: The answer is no for me.
Ms. Buck: No.
Mr. Lindsey: No.
Mr. Ross: No, as well.
Senator Murray: Has anyone been briefed to respond to this ''tollé'' that seems to be developing in the media these days and in the defence production industries about the apparent intention of the government to sole source the contract for the replacement of the CF-18s by so drafting the specs that only one company will be able to bid? Has anyone been briefed on that?
The Chair: Mr. Ross, maybe you could send us a note back on that. Rear-Admiral Davidson, could you let us know if the National Defence costs for its contribution, which was considerable at the front end of this Haiti operation, are out of your normal operating expenses, or was there some incremental cost that you were reimbursed for, and, if so, how much?
Mr. Moloney, if you are providing us with a chart of where the money goes and the various categories, could you tie that into the international assistance envelope that was brought to our attention when we did Supplementary Estimates (C) in March? I think most of us here are thinking of the decision that the Prime Minister and the Minister of Finance can make in the emergency situation.
We assume that all of the funds that have come out of that envelope are later approved by Parliament in the form of estimates or supplementary estimates, similar to Treasury Board contingency vote 5. Could you tie in all of the money that went out? I assume the $85 million or $120 million in Supplementary Estimates (C) was replenishment of the envelope, but perhaps you can help us to understand that and let us know if we are thinking correctly in that regard.
Unfortunately, we will have to wait for your answers because we have another panel that has been waiting patiently. I would like to thank Foreign Affairs and International Trade Canada, the Canadian International Development Agency, and National Defence for being here. From the many questions that we were not able to fully delve into, you can see that the work you are doing is important to this committee and to senators. We thank you very much for that.
With our second panel, we will be discussing the Canada Media Fund. I am pleased to welcome, representing the Department of Canadian Heritage, Pablo Sobrino, Assistant Deputy Minister, Strategic Policy, Planning and Corporate Affairs; and Helen C. Kennedy, Deputy Director General, Broadcasting and Digital Communications Branch.
Would either or both of you like to make introductory remarks?
Pablo Sobrino, Assistant Deputy Minister, Strategic Policy, Planning and Corporate Affairs, Canadian Heritage: As the chief financial officer of the department, I am here to answer your general questions. The person with technical expertise in the Canada Media Fund is Ms. Kennedy, who will present a deck containing a technical discussion, which addresses some of the questions that were raised at the appearance before the Treasury Board Secretariat. We thought we would address those questions first and then continue with your further questions.
Helen C. Kennedy, Deputy Director General, Broadcasting and Digital Communications Branch, Canadian Heritage: We are circulating a presentation today, the purpose of which is to provide general information and to help answer a number of questions that you may have about the Canada Media Fund.
The Canada Media Fund, CMF, replaces the previous Canadian Television Fund and the Canada New Media Fund. On the second slide of the deck you will see the main objectives. The fund is meant to promote the creation of convergent digital content across multiple platforms, including television, as well as to create interactive digital content and applications for the Internet, wireless and other emerging platforms. In terms of genres, the fund supports drama, documentary, children's programs, performing arts and variety in both official languages, Aboriginal languages and from all regions.
The fund is estimated to create over 22,000 jobs. The other numbers on slide 3 simply aggregate production volume data and present the leverage the fund has created with respect to volume of production. For every dollar invested, the fund has generated another $2 in production activity.
The CMF corporation is an independent, not-for-profit corporation. It is responsible for the administration of the Canada Media Fund and operates independently of government in that function. CMF administers the program as a whole, including a contribution from the government, as well as that which is injected from the private sector. CMF does so under the terms of a contribution agreement with the department, which we may talk a little more about later when we come to the issue of controls.
Slide 5 shows the CMF funding streams and eligible applicants. In terms of who will benefit, you have before you the technical definitions of who will be eligible applicants to the program according to the funding streams that the fund has put in place this year.
It may be more interesting for you to think about examples of possible projects that might be supported. A convergent project, for example, could be a television program that adds a web component that may enhance the program's storyline. A past example of this would be "ReGenesis,'' a science fiction program that included a website that integrated interactive media elements into the series. This led to the first successfully deployed alternate-reality game paired with a major television broadcast.
A typical project under the second stream, the experimental stream, might be the development of software to enhance the accessibility of multimedia content for both television and other digital platforms. The project could also be an innovative web- or mobile-based drama or comedy, video series or a cutting-edge interactive game for digital platforms, such as the Internet or mobile devices.
As you can see, CMF provides support to production in the regions, and it is up to the corporation to decide how to do that. Slide 6 shows a list of the current mechanisms to do so, including factor weighting that helps the fund determine the size of the performance envelopes and specific incentive programs in both the English- and French- language markets.
Slide 7 presents regional data by English- and French-language markets over a five-year period. We have presented percentages in the English market. Ontario has the single largest share, followed by British Columbia, Quebec and the Prairies. In the French market, it made more sense to provide dollar amounts for productions within Quebec and elsewhere, which rose between 2004-05 and 2008-09.
We also tried to provide a sense of the types of projects supported and the companies that produced them. Examples are shown of regional productions that were funded by the Canadian Television Fund, CTF, including such programs as "Razzberry Jazzberry Jam,'' "Buffalo Air'' and "Carmen à la campagne.''
CMF's total budget is $350 million. Cable and satellite contributions have risen over time as their revenue has grown. The Government of Canada remains the largest single contributor.
It is noted that individual broadcasting distribution undertaking — BDU — contributions remain confidential for internal use by CMF corporation. However, the Canadian Radio-television and Telecommunications Commission, CRTC, now publishes aggregated data for large distribution undertakings. A copy of the table with the largest contributors is being circulated to provide you with the contributions for 2008 and 2009.
Slide 9 breaks down the government funding to illustrate the total of $134.7 million. It includes $100 million per year as part of Canada's Economic Action Plan for two years; $14.3 million per year ongoing as part of the Canada's Economic Action Plan; and $20.4 million per year ongoing from Canadian Heritage.
In terms of controls, the contribution agreement with the government requires the fund to ensure due diligence and controls. The corporation must also put in place risk management and audit procedures, including an audit plan, and report regularly to the department. In addition, the department has the right to audit accounts and records of the CMF corporation.
I hope these few slides answered your questions. We are happy to provide any additional information. Thank you.
The Chair: Thank you. Many numbers have been given to us again.
We are dealing with Supplementary Estimates (A). We will soon be asked to vote on these. On page 9 is a figure for Canadian Heritage of $107.6 million. How does that compare to the summary that you gave us of $134.7 million?
Mr. Sobrino: The difference is the amount already in the Canadian Heritage budget of $20.4 million. One element is the renewal of what used to be the Canadian Television Fund and is now the Canada Media Fund. There is also renewal of the digital content side shown in Supplementary Estimates (A) as $6.185 million. If you add those three amounts, you will arrive at the total.
The Chair: What page are you on?
Mr. Sobrino: On page 83 of Supplementary Estimates (A), the first line is funds to support the creation of the Canada Media Fund. Two lines down it says, "Renewal of funding to continue the support of Canadian digital content and innovation.'' The amount is $6.185 million allocated in vote 5. Those two amounts plus the $20.4 million in our budget adds up to the total investment.
The Chair: Will we see legislation to rebrand and change these two entities — television and new media — into one entity?
Ms. Kennedy: No. The fund has been reformed, rebranded and combined as part of a renewed public-private partnership. It did not take any legislative change to make that happen.
The Chair: It was all done by ministerial directive. Did any regulations have to be changed?
Mr. Sobrino: The program for regular program approvals is administered by contribution agreements through Treasury Board.
The Chair: However, the previous two boards of directors will now be one. Presumably, there must be some regulatory change to help us understand.
Ms. Kennedy: There was one board for the previous Canadian Television Fund. The Canada New Media Fund was a program administered by Telefilm Canada under a contribution agreement with Canadian Heritage. The government decided to take those resources and inject them into a new fund under a private, independent board of directors with appointments from the public and private sectors. Only one board was changed. The Canada New Media Fund did not have a separate board.
The Chair: Have you anything that explains this governance change?
Ms. Kennedy: Absolutely.
The Chair: Could you send that to our clerk for distribution to our members?
Ms. Kennedy: Yes.
The Chair: That will help us to understand the new structure that you have briefly explained. Governance is important to us as well. We want to know what the board will administer, how they will be appointed and what representation will be involved.
Are there any questions flowing from this discussion?
Senator Dickson: Ms. Kennedy, slide 4 lists the Canada Media Fund corporation. Is that a new company or the old company with a name change? Was there ever a company? I am confused.
Ms. Kennedy: There was a corporation that changed itself into the Canada Media Fund corporation. It used to be the Canadian Television Fund corporation. It amended its corporate objects and by-laws to become the Canada Media Fund corporation.
Senator Murray: Was it federally incorporated?
Ms. Kennedy: Yes.
Senator Murray: Is it still federally incorporated?
Ms. Kennedy: Yes.
Senator Ringuette: Do you need legislation to do that?
Ms. Kennedy: No.
[Translation]
Senator Poulin: My question is further to that of Senator Day. Any change in governance is normally made through legislation or a change in regulations.
You mentioned the creation of a new board of directors, which, as you say, is a public-private partnership. To whom does that board of directors report, in view of the fact that there is no legislation or change of regulations?
[English]
Ms. Kennedy: The corporation's board of directors has a fiduciary responsibility over the corporation. For purposes of administering the Canada Media Fund program, it enters into a contribution treatment with the government. Under the terms of that agreement, it reports on its activities and results.
[Translation]
Senator Poulin: Then who would be responsible for selecting the two members of the board of directors who represent the government?
[English]
Ms. Kennedy: The two Government of Canada appointees are decided through the office of the Minister of Canadian Heritage and Official Languages. The rest of the board is appointed by the Canadian Coalition for Cultural Expression, CCCE, which represents the private sector contributors. They are the members of the corporation.
[Translation]
Senator Poulin: Would it be possible to get a copy of the incorporation document?
Ms. Kennedy: Yes.
Senator Poulin: I think that would help us answer our questions.
[English]
Senator Marshall: Is the corporation a Crown corporation or agency?
Ms. Kennedy: No.
Senator Marshall: It is neither. Does it have its own legislation?
Ms. Kennedy: No.
Senator Marshall: Where is its mandate defined?
Ms. Kennedy: It has its own corporate bylaws in that respect. For the purposes of the Canada Media Fund program, its parameters are set in the contribution agreement between the corporation and Canadian Heritage.
Senator Marshall: We should have copies of those documents because I would be interested in seeing the bylaws.
The Chair: We have asked for and will receive copies for distribution to committee members. Even a simple change of name requires some steps in the corporation.
Senator Murray: If I may, we might want to revisit a larger issue because we have been on this before under either the Martin or the Chrétien government. Some of you might recall that they created a number of foundations not by legislation, as would be necessary for the creation of a Crown corporation, but through the Canada Corporations Act. We suspected with some reason or justification at the time that they were trying to put as much distance as they could put between the operations of those foundations and Parliament.
It is a general issue, and I make no accusations for this particular one. We might want to revisit the general issue and decide whether we want to say anything soon about this practice.
The Chair: Yes. Senator Murray has explained well our concern because we have some history of trusts and funds that are, in part, government money. We would like to know how it is being administered and that it is being administered in the interest of Canadians.
Senator Dickson has a supplementary, and then we will ask for comments.
Senator Dickson: I will follow up on the general theme of the questions that have been asked. I understand that you will supply us with documentation. Could you clarify, the agreement was between the corporation and whom?
Ms. Kennedy: It was between the corporation and the department.
Senator Dickson: Which department was that?
Ms. Kennedy: It was with Canadian Heritage.
Senator Dickson: Are there agreements other than with Canadian Heritage? Are there any agreements with the private sector? Can you provide an organization chart to the committee so that we have better understanding?
Ms. Kennedy: Yes. We can provide you with information that will show the governance structure for the corporation to provide you with a sense of where the government's contribution agreement fits in.
Senator Dickson: I want to see the government contribution agreement as well.
The Chair: There are no further supplementaries. Do you have a general comment on that line of questioning before we go to general questions?
Mr. Sobrino: Yes. I want to confirm that the contribution of Canadian Heritage to the Canada Media Fund is from appropriations on an annual basis. It is not in the same structure as an endowment. It is a fund that is appropriated annually and expended in that year. The funding changes depending on the revenues of the private broadcasters. Currently, those amounts are going up because their revenues are improving, so the total fund is healthier than it might have been two years ago. We will provide all the documentation about how the corporation is set up and governed and the agreement that we have with the corporation.
The Chair: The agreement would explain how the federal contribution functions relative to the private-sector contributions.
Mr. Sobrino: Absolutely, yes.
The Chair: That will be helpful to give us a better understanding. Were two funds operating under different sets of rules that are being brought together?
Mr. Sobrino: Yes. The first fund was actually a program that administered a number of contribution agreements from Canadian Heritage with individual organizations. The government has taken that fund and combined it with what was known as the Canadian Television Fund. Those two funds form the Canada Media Fund, which is administered by CMF.
The Chair: If we track the federal government's contributions in the two funds from previous years, we will find that they track as one amount now. Is that correct?
Mr. Sobrino: Yes.
The Chair: They have been brought together. Is that correct?
Mr. Sobrino: That is correct.
Senator Ringuette: Looking at the list of contributors that you have distributed, I see that they are all Canadian- owned entities. The CRTC decision has been reversed by cabinet with respect to foreign entities entering the Canadian market. Will foreign entities contribute to the fund?
Ms. Kennedy: CRTC's regulations require that broadcasting distribution undertakings licensed by the CRTC contribute to Canadian programming. If Globalive does not have a licence to be a BDU, it would not fall under the regulatory requirement to contribute to the fund.
Senator Ringuette: I am looking at the two streams that you fund, the convergent stream and the experimental stream. Both are web-based, interactive mobile service providers. In Canada, the number of mobile service providers is greater than those on the list of contributors that you provided to the committee.
Ms. Kennedy: Yes. On this slide, we are talking about entities that may be eligible to apply for funding as opposed to entities that have a duty to contribute to the fund.
Senator Ringuette: First, I truly believe that this must be reviewed in terms of the convergence of media. Everyone is doing video or web-based animation of all types, whether CBC news or elsewhere. The stream of contributors definitely must include not only Canadian-owned entities but also Globalive. Foreign providers should be paying into this fund just as any other competitor pays into it. I do not see TELUS Communications Company on the list. We all know that these devices include telephone, Internet and television because they provide the convergence of all media. Why are they not contributing to this fund?
Second, the committee heard the testimony of representatives from CBC/Radio-Canada. You are talking about a licensed Canadian broadcaster being able to access these funds. I recall that CBC/Radio-Canada did not have access to these funds. I would like to know why that is so.
Ms. Kennedy: In fact, CBC has access to the fund. Its productions can be supported by CMF. However, you may have heard that CBC had, at one time, a guaranteed envelope. The last time the fund was reviewed, the government's decision was to remove the guaranteed envelope to create a level playing field whereby CBC would compete with others for funding from CMF. CBC has access to CMF.
Senator Ringuette: Okay. In your governance, it should be independent; you stated earlier that it is independent from the department. Your governance structure has received an ordinance from the Government of Canada to remove the dedicated envelope for CBC/Radio-Canada. That is what you are telling us. Therefore, your board is subject to the directive of Canadian Heritage.
Ms. Kennedy: The policy parameters for the fund were a matter of cabinet confidence and decision. They were then translated into the terms of a contribution agreement with the department and the Canada Media Fund corporation. Policy decisions were taken.
Senator Ringuette: You are telling us that the Government of Canada makes its contribution conditional, and that is the way they rule what is happening within what you described as your independent entity. Therefore, you are not independent, are you?
Ms. Kennedy: The contribution agreement sets the general policy parameters for the program. Then it is up to the fund itself to administer the program and to give effect to those policy parameters.
Senator Ringuette: You are not independent; you are subject to the government issuing policy to your board of directors.
My last question is a very important one, and its subject was in the media recently: the message event proposal, MEP. Have any of you been subject to the MEP?
Ms. Kennedy: No.
Mr. Sobrino: Not at all. I want to be clear about the contribution agreement. A contribution agreement is an agreement between the department and the recipient of a contribution agreement. It is essentially a contract. We provide resources for which we expect certain results. The results are outlined in there and are called the terms and conditions of the contribution agreement.
I want to be clear that the Canada Media Fund, as with any other recipient of our contribution agreements, receives a certain amount of funding with some terms and conditions that it must meet and report on. That is how the arrangement is made.
Therefore, when we provide a contribution agreement, it is an instrument of policy and an instrument of direction of how the government wants its resources expended. Every one of the 7,000 contribution agreements we do has something similar to that.
Senator Runciman: I am curious about a couple of things, having read the notes and know a concern was expressed by at least one party. It is about one of the criteria that are utilized to assess a program; namely, audience success versus historic access and the ratio there, which is 30 per cent for audience success and 45 per cent for historic access. To most casual observers, that would be puzzling because one of the criticisms of Canadian productions over the years has been the lack of broader public appeal, perhaps, and the ability to sell Canadian productions outside of the country.
What was the rationale behind that breakdown?
Ms. Kennedy: That is actually a very good example of where the fund operates independently. The government's direction is that they want programs that are reaching audiences. The fund then translates that into program guidelines that attempt to implement and achieve it. They came up with a factor-weighting system to determine the performance envelopes. As you pointed out, audience success was a part of that.
Over time, they have taken that whole issue very seriously. They are better placed, to be honest with you, than I am to explain the details of their calculations or methodologies.
Senator Runciman: This is outside of the government direction issue that we were talking about, is it?
Ms. Kennedy: Yes.
Senator Runciman: The government encourages this whole area as a measurement of success of Canadian productions; there is no doubt about it.
I have another quick question dealing with the convergent stream and the English-language production, which is targeted to address a decline in English-language productions over a period of time, I suppose. Is that done on a per capita basis? I see the monies will flow to Quebec, British Columbia, the Yukon and the Northwest Territories — 54 per cent and 46 per cent of the $10 million, I think it was.
Is that on a per capita basis? What is the process used for that type of application?
Ms. Kennedy: In terms of explaining the calculation, it is a measurement of the funding supported to productions occurring in those regions. That is how the percentages are calculated.
Amounts devoted to regional production can vary year to year, which is why we chose to present a five-year average. The regional licensing is also one of the factors included in the calculation of the envelopes.
The fund essentially deals with the applications that come in, funds them, has mechanisms in place to support them, and then reports out on what the results have been at the end of the year. However, they do not have a specific mandate stating that a certain amount must be in province X or province Y. Instead, they monitor it closely and provide mechanisms to support it.
Senator Runciman: Across the system, are long-term goals attached to timelines for what is hopefully achieved; is there some end game here?
Ms. Kennedy: A performance measurement framework is set out for the fund, and we will be looking at, for example, what the impacts would be on the levels of production and on the level of audiences. The whole experimental stream is new. Therefore, that will get up and running, and we will measure it to see what it is doing.
The general policy directions are to reward audience success; require innovation; and focus on what Canadians want — hence the genres that Canadians do watch. We can provide you with details on what those measurements and performance indicators are, if that would be of help to you.
The Chair: Thank you. We will make a note of that.
[Translation]
Senator Poulin: Having worked at Radio-Canada for more than 20 years, I am particularly concerned about the issue of Canadian production.
As regards the $134.7 million in funding you referred to for 2010-2011, including private contributions, it will total an envelope of $350 million. Why is the government contribution so limited in the context of an incredibly competitive environment with the U.S. market? And yet we know that the production cost of each of the television programs, whether it be through new media or conventional media, has risen significantly.
The government contribution is not big enough to show the very basis of our Canadian pride, which we can acknowledge, whether it be on television or on the Internet. I should put the question to the minister, not to those who deliver the programs. However, I admit that I am a bit surprised.
Mr. Sobrino: We have received the government share of the administration funding, and we have leveraged it with assistance from the private sector, which gives us more than what we invest; it is more than 50-50. So this is a success. At the start of the negotiation, the figure was much lower, but with the economic growth of the various businesses, it has become larger. Since this is the amount granted by the government, this is what it decided was a priority.
Senator Poulin: So we will put the question concerning the amount to the persons responsible.
[English]
Senator Murray: Just to clear up any probable confusion in my mind, the policy parameters are available. That is a public document somewhere, right? The broadcast agreements are private, confidential, is that correct?
Ms. Kennedy: Are you looking at the contributions in slide 8?
Senator Murray: No, I will come to that.
Ms. Kennedy: Sorry.
Senator Murray: The individual agreements, what did you call them?
The Chair: Contribution agreements.
Senator Murray: Are they private? All right, I will come to the slide that you want me to come to.
Ms. Kennedy: We use the same words in so many different places, so I want to make sure I understand you.
Senator Murray: The contributions from the large cable and direct-to-home, DTH, broadcasting distributors to the old Canadian Television Fund for 2008-09 are public information — we have it here — whereas individual contributions to the Canada Media Fund from broadcasting distribution companies "remain confidential, for internal use by the CMF corporation only.'' Why is that?
Ms. Kennedy: The CMF has typically reported out on its private-sector revenues by distinguishing between the cable portion and the satellite portion. I think it felt that some of the BDU contributions could constitute sensitive financial information.
The commission has, as we said in our presentation, recently begun to publish aggregated data for large distribution systems. It is quite clear in that data what the largest contributors from the private sector are putting in. They really do constitute the bulk of the funding. I wanted to table that with you today because I knew you were interested in what was coming in from the private sector and from what companies.
I guess we will see if the CMF corporation now will publish more granular data with respect to the contributions coming in from the private companies, but those are the largest ones there.
Senator Murray: Do you know why the Government of Canada has only two of seven directors in the Canada Media Fund corporation?
Mr. Sobrino: That was a policy direction that I received.
Senator Dickson: My question is a broader policy question. I am looking at slide 3, Canada Media Fund economic indicators. Hopefully, it will lead eventually to there being a fourth after you give due consideration, and cabinet and government give due consideration, and we break down some of the silos between different departments. Canadian Heritage responsible for sport; Health Canada is responsible for health promotion, and sport is part of exercise activity. In addition, the Auditor General said, I think — and I am new at this committee and really new around government — that the return for every dollar invested in health promotion is anywhere from 6 to 45 times. That means a great deal.
If someone looked further at the medical aspects, many policies should be viewed through the prism of health promotion. It is fortunate to have you here today, being from the policy branch of Canadian Heritage, to find out whether cabinet, when it was making these policy directive decisions to control all this money, received any advice about the companies making applications or about what percentage of the money or the themes of programs should focus on health promotion. If they did not, then why not?
In anything I have read, it seems that a very small percentage of money is spent by government on health promotion — and it is a priority of this present government. Legislation is in place that created the Public Health Agency of Canada, which is responsible for health promotion. I will be saying something about this in the Senate, so I would be interested in having your preliminary comments today and some more detailed comments later.
It really affects the bottom line when you think about it — 6 to 45 times; it is in the billions of dollars. Kids love to play interactive games and all that. I do not know what an interactive game is, but I know what a dollar is.
Mr. Sobrino: I really cannot comment on any advice we may or may not have provided. The parameters of the program in terms of what we are expecting from the Canada Media Fund are laid out, and we will provide that written information in response to your earlier questions.
I take your point about how programs are integrated across the system. We do make efforts to do that type of thing; but in this case, the objective is to increase Canadian audiences and to produce productions that Canadians will want to watch. That is really the objective of the Canada Media Fund.
Senator Dickson: I would appreciate very much if you had some discussions between your minister and the ministers responsible for sport and health. These people that are producing these programs must have a good deal of creative talent, so I am sure that they must be able to produce some programs that would focus on health promotion, which can make tremendous returns on the investment dollar. Also, the more you save as far as primary health care is concerned, the more is available for new medicines, palliative care and all the things that people want funded. I just do not get it, to be honest.
The Chair: Sometimes senators ask questions and other times they make comments. You are entitled to comment back if you wish, but it is not required.
Seeing no other questions at this time, I would like to thank you both very much for being here. Thank you for your patience and understanding in our timing with the earlier panel. We look forward to receiving the information that you have undertaken to send us, which will help us, I am sure, along with the testimony you have already given.
(The committee adjourned.)