Proceedings of the Standing Senate Committee on 
Foreign Affairs and International Trade

Issue 18 - Evidence - June 12, 2007


OTTAWA, Tuesday, June 12, 2007

The Standing Senate Committee on Foreign Affairs, to which was referred Bill C-293, respecting the provision of official development assistance abroad, met this day at 6:02 p.m. to give consideration to the bill.

Senator Consiglio Di Nino (Chairman) in the chair.

[English]

The Chairman: Welcome to this meeting of the Standing Senate Committee on Foreign Affairs and International Trade. Today, we continue our study of Bill C-293, respecting the provisions of official development assistance abroad.

First, I extend my apologies for the confusion in timing. It is not confusing to us, but our witnesses must wonder sometimes what goes on. Obviously, we do not control our time. Changes took place in the proceedings in the Senate that meant we needed to change a few things around. Thank you for your understanding.

[Translation]

Today's meeting will be divided into two separate parts. First of all, federal officials will be presenting the government's position on this bill, and then, we will be hearing from the Canadian Council on Africa

[English]

From the Canadian International Development Agency, we welcome Stephen Wallace, Vice-President, Afghanistan Task Force, who until recently was Vice-President of the Policy Branch and thus responsible for this file and Christiane Verdon, Senior General Counsel, Legal Services Division.

From Foreign Affairs and International Trade Canada, we welcome John Sloan, Director General, Economic Policy Bureau.

[Translation]

Also with us today is Alain Tellier, Deputy Director, Criminal, Security and Privileges and Immunity Law Section.

[English]

From the Department of Finance we welcome Graham Flack, Assistant Deputy Minister, International Trade and Finance. I welcome you all to the Senate of Canada.

The officials before us have a total of 15 to 20 minutes. We will stretch it, but we want as much time as possible to question and to have what usually is important dialogue. We will begin with Mr. Wallace, followed by Mr. Sloan and finally by Mr. Flack.

Subject to the consent of the committee, I ask Senator Corbin to chair tomorrow's meeting as both the deputy chair and I will be absent. I trust I have your consent.

Hon. Senators: Agreed.

Stephen Wallace, Vice-President, Afghanistan Task Force, Canadian International Development Agency: It is a privilege to appear before this committee and support its work regarding Bill C-293. As you mentioned, Mr. Chairman, I am joined by CIDA Senior General Counsel, Ms. Verdon.

[Translation]

Last year, on November 21, CIDA gave a presentation to the Standing House of Commons Committee on Foreign Affairs and International Development. CIDA indicated that the underlying objectives of Bill C-293, namely, clarifying the purpose, enhancing accountability and setting new standards for transparency, were in keeping with the directives that we had received from the government.

These objectives, which make up the foundations of enhanced international assistance, lie at the very heart of the direction set in the 2007 budget and in the aid effectiveness program that the Minister of International Cooperation is currently striving to implement. I would like to briefly mention these two operational issues.

[English]

I refer to two operational issues. First, there is the obligation to consult under subclause 4(2) whereby competent ministers must consult governments, international agencies and Canadian civil society organizations in arriving at an opinion under subclause 4(1). This obligation is potentially significant and has far-reaching implications in our view.

We support a thorough analysis by the committee prior to committing the government to a new and significantly different modus operandi. For example, the obligation to consult could cover literally thousands of decisions every year around the world for which specific consultation arrangements would need to be established and where Canadian civil society organizations may not even be present.

Second, there is the requirement that the minister take into account the perspectives of the poor when forming an opinion on the provision of official development assistance. This requirement may be problematic given the difficulty in determining exactly how this is to be achieved and what the test of performance might be.

The perspectives of the poor are extraordinarily important to ensure the success of any development effort. CIDA has developed a variety of mechanisms to ensure these perspectives are considered. The issue is clarity and performance and how one achieves this under legislation.

[Translation]

I hope that these brief comments will be helpful to the committee. Ms. Verdon and I would be pleased to answer your questions.

[English]

John Sloan, Director General, Economic Policy Bureau, Foreign Affairs and International Trade Canada: I have been asked to provide observations on Bill C-293 and I welcome the opportunity to do so before this committee.

My department shares the concerns expressed by my colleagues present this evening. The comments I will share with you now relate specifically to the concerns most relevant to the Department of Foreign Affairs and International Trade. Before proceeding, I introduce my colleague, Alain Tellier, from the legal bureau of the department.

Similar to my CIDA colleague, there are two points I would like to make today about the potential implications of Bill C-293. These points have been raised previously by Assistant Deputy Minister for Global Issues, Michael Small, and continue to inform my department's position. He is out of the country and therefore unable to be here today.

My first point relates to the issue of consultation. My second relates to the use of the official development assistance, ODA, test to determine appropriate avenues for Canadian development assistance.

[Translation]

The first point has to do with consultation. Although my department recognizes that consultation is an important aspect of policy making and engages actively where appropriate in various consultations, there could be greater clarity in Bill C-293 regarding exactly what is meant by this term.

As it currently reads, the bill could impose potentially onerous consultation requirements on ministers by requiring that the competent minister "shall'' consult with a broad array of governments, international organizations and civil society organizations, whether consultation is warranted or not.

Our concern with this section of the bill stems from the fact that there continues to be the potential for confusion regarding the intent of the bill versus the legal interpretation of the text.

[English]

Issue two is with respect to the ODA test. Turning to the specific responsibilities of the Minister of Foreign Affairs, the language used in Bill C-293 related to the various ODA tests in subclause 4(1) may be problematic.

Much Canadian development assistance contributes to the goal of poverty reduction in developing countries, but it does so indirectly in some cases and over a longer period of time through such means as increasing the security of citizens, encouraging better governance, improving policies and policy-making capacity and promoting respect for human rights. The Department of Foreign Affairs and International Trade, through the Global Peace and Security Fund and its sub-programs — such as the Human Security Program — funds programs for all these purposes.

Some of the programs qualify as ODA, as defined by the Organisation for Economic Co-operation and Development, OECD, and some do not. An example of a program that is considered ODA would be the deployment of corrections training officers to the Ivory Coast. A non-ODA example is funding for the African Union mission in Sudan.

Unfortunately, unlike the OECD's guidelines on what is ODA, Bill C-293 does not have a clear test to determine what is a contribution to poverty reduction and what is not. This lack of a clear test creates ambiguity, both legal and practical. Similarly, the practical implications of the test, to take into account the perspectives of the poor and consistency with international human rights standards, are not clear either from a legal or a programming perspective.

Both the ambiguity surrounding the test found in subclause 4(1) and the requirement to consult in subclause 4(2) may well create unnecessary obstacles for us when critical events are unfolding and we need to make important decisions on what to fund and when.

I welcome any questions honourable senators may have regarding the view of the Department of Foreign Affairs and International Trade on the implications of this bill for the effective and efficient delivery of Canada's international assistance.

The Chairman: Thank you, Mr. Sloan. Now we have Mr. Flack.

[Translation]

Graham Flack, Assistant Deputy Minister, International Trade and Finance, Finance Canada: Mr. Chairman, first of all I would like to thank you for inviting me here today. If you do not mind, I will raise only three points so that we can have more time to answer your questions.

[English]

The first point I wanted to make is in terms of a concern we have around the bill. Paragraph 5(1)(d) of the bill deals with the Bretton Woods Institutions. It provides that the Government of Canada shall provide "a summary of any representation made by Canadian representatives with respect to the priorities and policies of the Bretton Woods Institutions.'' The concern here is with the phrase "any representation.''

The best analogy I can give you to the executive board of the International Monetary Fund, IMF, and the World Bank is, it is like a cabinet. It encourages a frank and clear exchange between members on the issues before it. For example, if a country report is being analyzed, the Canadian representative may give relatively blunt advice behind closed doors about the exchange rate policy of the country — advice which, if it was made public, would be highly market-sensitive.

There may be private information — information about where the country is in developing its strategy around the repayment of debt to private creditors, for example. This report, as laid out in this clause, would require us to report on any representation that the Canadian representatives made in these institutions. In that regard, the executive representatives for Canada and the rest of our constituency at the IMF and the World Bank have expressed concern about how Bill C-293 could affect their ability to carry out their duties.

It is important to note that while they are executive directors who are nominated by the governors of the countries they represent, they are actually employees of the bank and the fund, and are strictly bound to adhere to the policies of those institutions. Those institutions have clear confidentiality policies on the nondisclosure of information such as this to other individuals.

The result would be either they would be placed in a position where they breach their obligations to the institution, or where they simply refuse to give us the information about the representations they made because it would put them in breach of those nondisclosure policies.

A further complication to draw to your attention is that unlike the United States or the United Kingdom, which have their own constituencies where there is only one member — the United States — in Canada's case, our director represents Ireland and the Caribbean constituents as well. The representations that the Canadian executive director makes are not only representations of Canada, but of all those constituents. To try to disentangle from those representations the exact Canadian position is further complicated. Also, if there is a breach of confidentiality, it would breach the confidentiality of those other constituents that we represent.

The issue of consultations was raised. Subclause 4(2) appears to require the government to consult on a wide range, potentially every type, of development assistance. If I could bring a Department of Finance perspective to this issue, in the recent budget, the government laid out a program for aid effectiveness that included a commitment to efficiency and a commitment by the government to set clear targets to reduce overhead.

Introducing significant additional consultation requirements for potentially every single project will take us in the direction of increasing the overhead requirement and reducing the amount of development assistance available to deliver to those in need. I ask the committee to consider if we want to head in that direction.

Similarly, with regard to the third point I would like to make about the production of reports —

[Translation]

With respect to reporting, we already put out a comprehensive report on the Bretton Woods institutions. You heard the comments from the group from the Halifax Initiative, who congratulated the Minister of Finance on the improvements made in the 2006 report. We have a copy of the report, and we would be pleased to give it to the committee clerk.

The problem that we have with Bill C-293 is specifically with clauses 5.(1) to 5.(3). They would require us to put out two additional reports containing exactly the same information required in the report that we already produce.

[English]

My pitch here again is, we can replicate the same information we have in the report we already provide in at least one, and possibly two other reports. That may have some positive impact on the pulp and paper industry in Canada; but the question we ask you is, do you want us, as a department, to spend more money on individuals writing and rewriting in different words the same report, and more money on publishing those reports? Alternatively, will we aim to reduce overhead by being more efficient so we can take a higher percentage of the aid dollars we now spend and put them in the hands of those in need? Those are the three points we wanted to draw to your attention.

The Chairman: All three of you were succinct, and I extend my gratitude to you for leaving a lot of time for our colleagues to ask questions and engage in some debate.

[Translation]

Senator Corbin: I read the proceedings of the House of Commons committee that examined this bill. I believe that several of you testified before that committee, and you raised the problems that you had with the original drafting of the bill.

Furthermore, the sponsors of this bill, the member of Parliament and Senator Dallaire from the Senate, told us that consideration had been given to the points that you had raised during the study of the original bill.

When you read the bill as it was amended by the House of Commons, namely the bill that is now before us, do you find that your observations were taken into account?

Mr. Wallace: We identified two issues in particular that were related to the current wording of the bill. One of our concerns had to do with the requirement to consult, and the other had to do with the need to take into account the perspectives of the poor. A few problems remain with the drafting of the bill.

Senator Corbin: Mr. Sloan, Mr. Flack, do you have any other comments?

Mr. Flack: Two amendments dealt with the difficulties that were identified. One of the amendments was to the definition of international assistance, for there was a risk that the definition could be interpreted as meaning that the government could not provide funding in areas that did not contribute to poverty reduction. We wanted a broader definition of development. So, an amendment was moved to solve this problem, because this was not the original intent of the bill. However, the three points raised remain.

The first point had to do with the drafting of a report further to representations from World Bank officials to the international institution. An amendment was moved, and the members of Parliament were receptive to our proposals, but the entire part where the amendment appeared was removed. I do not believe that the purpose was to do away with the amendment; rather, it disappeared with the rest. In any event, the problem with our representatives before these two institutions continues. They will find themselves in an impossible situation and have no other option than to provide confidential information, which runs counter to the way committees operate. This is a problem.

The second point has to do with consultations, as Mr. Wallace just mentioned. If stakeholders were to turn to the courts, for example, what level of consultation might they ask for? Could they ask for a study requiring a consultation with all necessary groups for each and every project? This approach is risky, particularly for CIDA. As for the Department of Finance — which is in charge of the funds — we fear that a great deal of funding might be required for additional consultations. So that is the question that we are putting to the committee: do you want to increase the amount of funding available or reduce it?

Finally, our third point about the bill, which mainly affects the Department of Finance, has to do with the requirements for additional reports based on the same information, in a second or third report. In our opinion, this requirement would lead to an inefficient duplication of effort. It is not a problem, we could always do it, but the amendment was not made in this part.

[English]

Mr. Sloan: In his testimony to address Bill C-293, Michael Small raised three issues: first, the language related to the original wording on "competent minister''; second, the language related to human rights obligations or standards; and third, the use of the ODA test, which contained two sub-parts. One sub-part was related to contributions to international organizations where there was a varying scale and the other related to the ODA test on various initiatives funded by the Department of Foreign Affairs and International Trade, such as the Global Peace and Security Fund.

I believe that the language in the first two issues has been addressed. The language on the use of the ODA test and the possible confusion has not been addressed. If my memory is correct, the reason we did not address the question at that time of consultations and the difficulties that the current language might pose is that they were covered by other presenters.

Senator Andreychuk: You commented that taking into account the perspectives of the poor is problematic in how you go about it and whom you consult. As well, you commented on consultations with civil society organizations in Canada. On "consistent with international human rights standards,'' what are your comments? I understand consistent with international obligations, which would be the UN conventions that we have signed and declarations to which we are a party. However, how do you interpret "international human rights standards?'' I would like some clarification on that. Is it a term you use at CIDA or in the department?

Alain Tellier, Deputy Director, Criminal, Security and Privileges and Immunities Law Section, Foreign Affairs and International Trade Canada: Thank you for that interesting question. We have looked at the term and find that it is defined in the draft bill.

The proposed definition continues to raise question in terms of how it will be interpreted. If, eventually, it went before the court for interpretation, how clear would the text be? What is the potential for raising difficult questions? We believe there is such a potential. The text currently refers to international human rights conventions. It is not clear at this point whether the intent is to refer to the conventions ratified by Canada as a party or to the broader group of international human rights conventions.

As well, there are varying views as to what is included within the group of human rights conventions. For some conventions it is clear and everyone agrees, such as the UN Convention on the Rights of the Child or on racial discrimination. You will find that a long list of conventions is referred to as related to human rights, where you may have divergent views as to whether they correspond to the term "international human rights convention.''

A word based on that might raise questions. I understand from previous witnesses last week that this is meant to provide flexibility in the term. This flexibility might be useful in some instances but in other instances it might raise questions such as, how does it apply to human rights standards that are under a best effort commitment or a progressive implementation commitment, as we find in some of the international conventions. What is the situation for those found in non-binding political declarations or guidelines that stem from international conventions? Could we say that they are based on those international conventions or should we restrict ourselves to the conventions?

The term "standard'' can also raise questions as to the precise reference. It is not strictly linked to binding standards. Are they standards found in conventions? Are they standards found in regional or global documents aimed at implementing, illustrating or explaining further the treaties and conventions? All these questions are difficult to answer and might be argued in more than one way.

Senator Andreychuk: Clause 4(1)(c) says, "is consistent with international human rights standards.'' I found that curious. I am part of many coalitions and groups that want international obligations adhered to. If Canada has signed, we are encouraging Canada to ratify. If Canada has ratified, we want Canada to implement.

This clause talks not about the conventions, the obligations and the right of the international community but rather it talks about being consistent with them. Who would interpret that provision, apart from a court? Would the minister determine that they are consistent? Of course, the task would be delegated.

Mr. Tellier: Yes, Canada certainly intends to adhere by its international obligations and commitments under the treaties that it ratifies. As to the reference to "consistent with,'' it is my understanding, and I do not speak for the sponsors of the bill, that the intent of the bill is to allow reference to obligations that generally apply — in the case of Canada, it applies to Canadians. It might not apply to ODA outside the country. I understand the logic. You are right that, at the same time, it makes it difficult to refer to the better known and better understood commitments that were negotiated and included in those treaties.

I am sorry, you mentioned a second part?

Senator Andreychuk: It is the minister who would determine whether the minister is of the opinion, so it would be a subjective standard of the minister.

Mr. Tellier: I suspect that initially, yes, it would be for the minister to formulate the opinion mentioned in clause 4. This opinion could eventually be challenged, I expect, and submitted to a court.

Senator Andreychuk: It could only be challenged administratively, because if the minister said, "I have looked at certain documents and I have weighed it and, in my opinion, it is consistent with international standards,'' that would be the end of it, full stop. I do not think a court would step into the shoes of the minister. My point is that if the act talked about international obligations, then the convention that is referred to or spoken about would speak as to how it is applied. The implementation would not flow from a minister's opinion. It would flow from the obligations inherent in the convention.

Mr. Tellier: Not wanting to go too deeply into administrative law, which is not my area of expertise and I do not want to speak without having the knowledge, it might also raise questions eventually of the interpretation of international treaties and who, in the end, under this act, would be tasked with formulating an opinion on the consistency with those international documents.

Senator Downe: Mr. Flack, in your presentation, you indicated that executive directors representing Canada at the IMF and the World Bank had concerns about confidentiality provisions in the bill. Did they have any other concerns?

Mr. Flack: The key one they raised was around confidentiality, but if I could go back to Senator Andreychuk's question, an additional concern was linked to the issue she raised. The IMF, as you may know, was set up in a way to invite the broadest possible membership. As a result, the fund is not allowed, by its design, to attach conditionality to international human rights issues. It is not allowed, in its approach when judging a country, to assess international human rights standards.

There is a question about whether a minister could find that all the funds' activities, to the extent the IMF deals in providing reports to countries on how their economic conditions are progressing, if that country did not follow international human rights standards, whether it would be consistent with us providing funds to an IMF that ultimately reports on that.

That was the second issue raised by the executive directors, but the key one was on confidentiality. They had a high level of anxiety. In fact, I am sure they would be delighted to have the opportunity to appear before you to express those views directly. In part, it is reflective of the fact they are not employees of the Government of Canada; they are employees of the institution and have obligations to that institution.

Senator Downe: They are not employees of the Government of Canada? We do not pay their salaries?

Mr. Flack: Correct: They have contracts with the institution and a fiduciary obligation to confidentiality with that institution. We have an excellent working relationship with them. We provide recommendations, as does the government of Ireland and the governments of the Caribbean, on what they say. We receive an excellent debrief on what went on in the meetings, but we do not publish all of those difficult details, because to do so would undermine the efficacy of those institutions. Much in the way that the ultimate decisions of cabinets are published, the ultimate decisions of the IMF and World Bank are published, but the details of exactly who said what and how aggressive the criticism was inside the executive committee or inside the cabinet are not published.

Senator Downe: The government appoints individuals to represent Canada at the IMF and the World Bank as executive directors, but we do not pay their salaries. Do we reimburse the IMF and the World Bank for funding?

Mr. Flack: We fund the institutions generally, but the institution has a range of individuals who work at the institution, including the executive directors. I guess I would be careful in the word "appoint.'' We work with our Irish and Caribbean constituents to identify the individual who we agree will be the executive director for our collective constituency. This is not as much of a problem, obviously, with the United Kingdom or Britain or the United States because they have a single member constituency. They are the only country. The Minister of Finance, in our case, works with the governors of the other ministries of finance, the minister of finance for Ireland and the ministers of finance for the Caribbean, to identify a candidate. At both institutions, the executive director has been, in practice, a Canadian. They are an employee of that institution with obligations to that institution.

Senator Downe: The point I am getting at is, in all past cases, they have been Canadians. Is that correct?

Mr. Flack: Correct.

Senator Downe: They are representing Canada and these other countries, and they are bound by the policies of the institutions, but if this bill went through, they would not be bound to divulge any information pertaining to any other country than Canada. Is that correct?

Mr. Flack: I could break it down into two parts. Let us imagine you have a country report on country X, and Canada believes, as does Ireland and others that they should be very blunt in their criticism of the economic policies of this country, but Canada provides advice to the executive director. The executive director will, in that closed door meeting, make a blunt assessment of the economic policies of that country. That would be a representation that the Canadian executive director has made. It is a representation, as are the vast majority of representations in this institution, about other countries, because that is what the institution does. If we were required to provide a summary of that representation, it could move markets, potentially, to the extent that that information was market sensitive. It could certainly undermine our relationship with those countries.

Senator Downe: I understand that. If the person is not an employee of the Government of Canada, how does this bill affect them?

Mr. Flack: We have a relationship, as I think you would want us to have, where the governor, the Minister of Finance, has discussions, and we have working level discussions regularly with the executive director in the office of the executive director so we understand in considerable detail exactly what is going on and what is being said. That detail helps us formulate our perspectives for future cases. At the extreme, if we were to tell the executive director, "We will automatically publish everything you give us on this,'' the executive director would stop giving us that information. That would be an unprecedented situation where the governor, the Minister of Finance, would not know what the executive director was saying or what was going on behind closed doors in this committee for fear that the minister would be obliged to publish it. In effect, we would be blind as to the operations of these important institutions that Canada played a critical role in founding, and that is our concern.

The Chairman: As a quick piggyback supplementary question, I hear you say that if Bill C-293 became law, you would not be able to comply with the summary of any representation that the bill calls for in paragraph 5(1)(d). Because of the potential legal obligations and conflicts, the executive director would not be able to comply with that. Is that what you are saying?

Mr. Flack: The analogy I might give is that it is like being inside cabinet. They might be able to comply once, and then they would no longer be in the cabinet. To the extent that we provided that confidential information and released it, the flow of confidential information would cease. I was making light of that, but that is an untenable situation for the government to be in. Although this individual is an employee of the bank or the fund, they work closely with us and with the governor, so that is the risk.

The Chairman: I apologize for laughing. It is a serious matter. I think we in the political arena understand that. Thank you for that clarification.

Senator Smith: I will ask three or four questions, and I will ask them all at once. Whoever wants to reply can do so. As you know, this bill did not start here. It started in the House of Commons, and the three opposition parties all supported it. In fact, the present Prime Minister, when he was in opposition, indicated support on the record for the principle of what it was trying to achieve. I think the bill was well intended. Is the status quo of the world that this is trying to deal with, fine and dandy? Are there things that should be addressed?

I hear lots of concerns about, for example, why can you have foreign aid projects that are somehow linked to trade with Canadian products? Why is the number of people in the Canadian International Development Agency, CIDA, so huge and the number of operatives in the field so miniscule? Why are some projects in countries where, historically, there was a lot of poverty — and there still is some — but they have become economic powerhouses, such as India, China and places like this? With respect to the goals and intent that this bill is trying to deal with, is that a valid concern? Can some fine tuning on things such as confidentiality put the bill in shape so that you can live with? Do you think, on balance, it would be helpful or are you saying this is hopeless and forget it? What are you saying in answer to those questions?

Mr. Wallace: Thank you very much for that question. I think it is clear that the underlying intent of this legislation with respect to clarity of purpose, strengthening of accountability and achieving greater transparency are all essential objectives and ones that are fully consistent with the guidance we have received from government as well.

When you examine, for example, Budget 2007, and look at the three-point program that was laid out in that budget, it is clear that the budget speaks directly to issues of purpose, accountability and transparency at the same time. If you look at that agenda that is laid out in that budget, it is far reaching in places. It will tackle head-on the issue of concentration, for example, and on not having Canadian assistance spread out in too many countries for too many purposes. It will handle directly the issue of overhead in field versus headquarters staffing, and it contains within it a direct commitment on strengthening field presence as part of the forward agenda.

If you examine the specific provisions in Budget 2007 and in that agenda of aid effectiveness of the government that has been put in place, it speaks to those three issues directly: accountability, clarity of purpose and increased transparency.

Senator Smith: They are still not statutory parameters.

Mr. Wallace: No, those are achieved essentially through the provisions of that policy purpose.

Senator Smith: Any other panels?

Mr. Flack: The budget is an unusual platform from which to introduce a policy around, let us say, development assistance. It was a sign that the government attached significant enough importance to this issue that it wanted to put it in a document that is normally associated with the financial priorities of the government.

The commitment here laid out is to these three principles: focus, efficiency and accountability. As Mr. Wallace indicated, however, there are specifics underneath, including a commitment to countries of concentration to be a top- five donor, which is a significant commitment in terms of the resources that would need to be allocated. To a number of the elements that appear in this bill, there is a specific commitment on accountability that talks about how we must have a better means for parliamentarians to measure the results that we achieve.

Speaking from the Department of Finance perspective, we are waiting for the full plan to come out before we take action. You saw evidence of that in the 2006 Bretton Woods report that we tabled, where we attempted, in a clearer way, to identify the priorities of the government vis-à-vis these institutions and where we had succeeded and failed with respect to those priorities. The Halifax Institute, which I believe appeared before you a couple of months ago, talked about the improvement in the report that the Department of Finance had made significant progress. I agree with you that words cut at this level are not sufficient. They are a precondition, but a precondition to a plan that is much more detailed that will lay out these elements.

Mr. Sloan: To agree with my colleagues, I think all three of us share the intent behind the proposal, but we are worried that the drafting as it currently stands will provide both a certain additional complexity and perhaps layers of bureaucracy that will impede our ability to implement an effective and efficient international assistance program.

The Chairman: Senator Smith, are you satisfied with that? Can we move on?

Senator Smith: I am satisfied that they gave their thoughts. I am still not sure they are happy with the status quo. Who is?

Senator Merchant: I seek clarity or help with the ODA test. I am trying to confirm my assumptions about this test. If official development assistance is provided solely on the basis of poverty, then I would like to be sure of the factors that will no longer be considered.

First, am I correct that implicitly, countries that make progress on solving their poverty problems will no longer receive any priority attention? Do you know what I mean by that? Would countries, say, that develop fisheries instead of asking us for more fish, no longer be a priority for us? Would countries where the leadership may steal the money or the aid and use it to feed an army who may be slaughtering an opposing faction be underweighted or taken off the list, if aid for their poverty remains high? If a country stands for principles such as human rights, that we hold dear, and their neighbour embraces our principles, would we then treat them equally with the naysayer who might be more poverty-stricken and receive more aid than the people who espouse the principles that we stand for?

How do other countries handle this issue? Do countries look at these parameters when they decide how they want to spend their aid dollars?

Mr. Wallace: I think it is fair to say that most countries, in addressing the issue of how they make decisions on the allocation of aid, increasingly take into account country performance. That country performance can take many guises in terms of commitment to poverty and respect for human rights, for example.

It is also fair to say that few of these decisions are ones that are derived directly from legal provisions. They are mostly policy positions taken by the governments themselves with respect to performance-based allocations.

You started with a question with respect to the scope of what is meant by poverty reduction. Here, I think the committee has listened to a variety of testimony which, perhaps, has underscored the fact that there is a lack of clarity around what constitutes the scope of poverty reduction. In some instances, the committee has heard that poverty reduction is a relatively narrow concept, more akin to humanitarian assistance and social development; in others, it has heard that it is a broad one. The issue that was underlined originally by my colleague Mr. Sloan about ensuring that there is clarity with respect to definitions in areas such as this one is a key point.

By way of example, perhaps I can give you a sense of what the scope of poverty reduction is as understood by the OECD, which gives at least one dimension to this issue in the guidelines from their Development Assistance Committee, DAC; there are others.

According to the DAC Guidelines on Poverty Reduction, "The dimensions of poverty cover distinct aspects of human capabilities.'' These include economic dimensions, which involve income, livelihoods and decent work; human dimensions of poverty, which are health and education; political dimensions, including empowerment, rights, and voice; socio-cultural dimensions, which involve status and dignity; and protective dimensions.

Concepts of security, risk and vulnerability were underlined by the OECD as being part and parcel of the distinct dimensions of poverty, which is a broad scope.

There are other aspects here to be covered. The key element perhaps for the committee's work is the issue of clarity with respect to what this aspect means in the Canadian context and for this piece of legislation.

Mr. Sloan: The other side of the question was the question of the ODA test. I would like to flag the fact briefly that we do have in the DAC a definition of ODA, which is, promoting the economic development and welfare of developing countries. This is an internationally agreed-on definition, the application of which is incredibly complex and convoluted. There are extremely detailed documents from the DAC outlining what can be counted as ODA and what cannot.

If we have a separate Canadian-only definition as to what can count as ODA, and we still have the separate internationally agreed on definition in the OECD, it will raise clarity questions with regard to our definition of ODA.

The Chairman: If we tie official development assistance to the narrow focus of poverty reduction, it will likely be subject to some tests, interpretation and debate. Will this tie create the kind of problem I see in my mind? Is anyone able to comment on that?

I am concerned about the narrow focus of the bill, tying ODA to poverty reduction, which will be subject to tests and may create problems. Am I correct?

Mr. Wallace: I believe the question is legitimate. There is not an immediate and broad understanding of the scope of what poverty reduction entails. Therefore it will be subject to variable interpretation. Achieving clarity with respect to the scope of this focus would be a helpful way of ensuring that there is no ambiguity as we go forward on that question.

Mr. Sloan: The history of the discussions inside the OECD of the definition of ODA simply reinforces the point you made. These discussions can be extremely convoluted and difficult, and they continue today as the definition is examined and re-examined in light of new circumstances.

The Chairman: I appreciate that. Thank you for your clarity.

Senator Segal: I wanted to raise some of the responses to the concerns you have already addressed and which I raised in the chamber about aspects of the bill that we have heard from the well-meaning proponents of the bill.

Ms. Verdon, in response to the anxiety about "must consult'' and the implications that those words would have for CIDA — to produce a layer of bureaucracy, to produce non-governmental organizations who felt they must be consulted, force consultation with governments we might not wish to consult with for good and substantial reason — we were informed in testimony last week by legal advisers to one of the NGOs that has a strong view in support of this bill that we are hyperventilating or overreacting here.

In the normal context, the minister and officials have the right to decide what constitutes consultation; to define it. As long as it was in any way reasonable, the notion of some court imposing upon the minister a higher standard or a more broadly based context for that to the point where it was in the way of the smooth administration of the foreign assistance program was only hyperventilating, that we were over worrying about that. Can you respond to that?

Ms. Verdon: It is one possible interpretation. There may be others.

I know the committee has heard from witnesses and that other Canadian domestic legislation imposed consultation obligations. It would not be a big change to have that consultation in this bill.

We looked at many of those examples, as a matter of fact. It seemed they were in different contexts where obligations were imposed on ministers to consult for a small part of their duties and powers. This bill creates — in the case, for instance, of the minister responsible for CIDA — a duty to consult for a broad range of activities; almost for the entire mandate of the minister.

There are different interpretations that could be sustained.

Senator Segal: My second question is what I would call the chewing-gum question. We have all seen the advertisement on television where an engineer is walking by a dam and there is a leak. Rather than dealing with the structural issues, he puts gum on it and walks off. I think the commercial is for retirement planning.

The worry I have about this bill is that it does not achieve any of the goals of broader transparency and a broader regime of governance that various folks — including people within CIDA — have suggested over time we may want to embrace: The notion of not having our own U.K. Department of International Development, DFID, kind of legislation that is explicit and not a subparagraph of another act but its own law.

My concern is because it is difficult to have the time of both Houses of Parliament to address this kind of instrumental design question, it is a hard thing to have happen. If this bill were to pass in its present form, some people would say we have done a good job and off we go, and the actual core issue is not addressed unless some administration decides to do so.

It strikes me that the good faith in the other place amongst the other three political parties — and I think probably broadly shared without respect to partisanship — is that the elephant in the room is greater transparency. We all have this task, as government modernizes, changes, becomes more complex and new legislation is overlaid, accountability and all that stuff. How do you deal with that transparency question without so paralyzing an instrument that the end result is you have transparency, but you also have complete paralysis? That is not what anyone wants, because we want our foreign aid to go to the right places, in the right amounts and to have a positive impact. We all share that view.

Assuming that you do not want to prescribe a change in policy, because of where you work and the constraints that public servants traditionally face under the Westminster system, what advice do you have for the committee on the broader question of transparency, at least as it is raised by this piece of legislation?

Anyone who has the courage to address it, I would be delighted. I want to assure you that I will defend you, win or tie, in case any minister is upset, for whatever that is worth.

Mr. Wallace: Thank you very much. It is absolutely the right question to ask. Can there be a higher standard of transparency achieved in the way the government both manages and demonstrates the effect of its development assistance? I think everyone would agree that higher standards can and should be achieved.

Having said that, when you go through the range of reports, for example, clearly, more work can and should be done in this area. My colleague Graham Flack talked about some of the reporting evolutions. A number of reports are new developments over the course of the last year or so — both general reports on development assistance and specialized reports in the health sector or Afghanistan or an example of democratic governance. However, in doing more work, it is important to ensure that what is enshrined in law is clear enough and straightforward enough to add value without adding needless overhead.

I can provide a practical example in the legislation. Clause 5(1)(b) is a reporting provision. The requirement in clause 5(1)(b) obligates the government to report a summary of any activity or initiative undertaken with respect to development assistance.

In undertaking to address this unprecedented broad notion of reporting on any activity, attempts have been made to help by talking about a summary of any activity. It is not clear from this language that this notion substantially changes the obligation of ministers under this section. It is also not clear that reporting obligations of various ministers, which are responsible to Parliament, may not be blurred with respect to the accountability relationship when a single minister is summarizing activity that takes place under the mandates and responsibilities of many other ministers.

This is an underlying intent clause of greater transparency on reporting, which I think is a compellingly important objective with which everyone would agree, but which, with respect to this particular formulation, may have unintended consequences that may not get you to the objective you are seeking.

Mr. Flack: I would like to give a concrete example. Four parts of the bill under clause 5 deal with a requirement for the repetition of things that are already in the Bretton Woods report, which we already prepare, that we would republish in another format.

In an era when everything is accessible on the Internet, do we really want another print run with the same information and the same copies? Does that provide greater transparency to Canadians, or should the focus be to improve the quality of the report? We said in the Department of Finance eight months ago that the report needed to be improved as we did not think our report was doing a good job of articulating the priorities and how we were achieving them. We focused our efforts on improving the report, and that resulted in the Halifax Institute, which has been a critic of many of our activities in the past, commending us on the new report we produced. We have a ways to go to improve it further.

One concern of the Department of Finance is overhead. Every dollar we spend on overhead is a dollar that does not go toward development assistance in the field. I invite senators to consider the impact the bill would have on overhead, and the direction you want to go on that. We are, of course, at the service of Parliament, and if Parliament wants us to do the same report twice, we will do that. If you want us to consult on every project, Mr. Wallace may need to develop several new teams, but we can do that. I appreciate that there are benefits from the perspective of further engagement with civil society.

However, this provision has consequences and costs, and we invite senators to consider those costs. As Senator Segal said, where in the overall effort do we want to direct the reform of Canada's international development assistance? This is one piece, but it impacts on the other pieces, and not necessarily in a positive way. Where should we direct that effort?

The Chairman: Thank you, Mr. Flack, for supporting a principle that we articulated clearly in our Africa report, which talks at length about having more money for development rather than more money for administration.

Mr. Tellier: Enhanced clarity assists in achieving greater transparency. We earlier mentioned a couple of elements in which clarity raised some questions.

I draw your attention to subclause 2(2) of the bill, which says that Canadian ODA shall be defined exclusively with regard to the values identified in subclause 2(1) under "Purpose.''

This provision raises the question of how this relates to and meshes with the three criteria found at subclause 4(1). I will take this opportunity to mention that earlier there were references to poverty being the test under the act. As I read subclause 4(1), there are three tests and all three must be met. That is only for clarification. This is another example of questions that might come up when the time comes to implement a bill such as this.

[Translation]

Senator Dallaire: Mr. Flack, I find it fascinating to see your interest in not making more work for our public servants, even though in some fields we see countless reports being published — reports that at times are repetitive — and all the bills that have been considered over the past year. I appreciate your interest in reports, but there is a fundamental issue at stake: what is being done with the money that we are allocating to official development assistance? The answer is not clear.

We hear that it takes two years to get a complete report from CIDA. Recently, funding was provided in your budget. According to other sources of information, international development is conducted in different ways, depending on the department involved, such as the Department of Foreign Affairs, CIDA and the Department of Finance, and that there is no consistency. So the objective was not to reform CIDA or to reform the way the Department of Foreign Affairs and International Trade functions, but rather, the bill is intended to focus efforts on the three points that were raised earlier, namely:

[English]

Clarity of purpose, transparency and accountability. The aim of the exercise is to determine what the target is, to determine whether we are achieving the target, and to receive a report in six months that the target is being achieved. The essence of the bill essentially tells me that. There are methodologies described here that may be complex and create problems.

With regard to consultation, I do not see that it says that the minister must consult with everyone who is poor, and every organization, NGO and government in the world to which we give 50 cents. It says the minister wants consultation. It seems to me that you should be undertaking that process. When we tell children that we have the answer to their problems, we often discover that the child has a better answer than we do but has not been consulted.

Do you believe the extreme positions you have argued today, that through consultation with those governments we are changing the fundamental methodology of the minister? Why are they travelling all over the place and why are you receiving all these reports? Is it not simply putting into focus that by defining poverty reduction we are assisting the minister to look for the right information in the right places? Also, ultimately, through the processes of the reports indicated here, we will give them an instrument to come back to Parliament in a timely fashion, at which time parliamentarians can tell the minister that the minister went too far and stalled the process or that the minister has not done enough and must do more.

Does this bill not permit that consultation to be focused instead of being all over the map, as it is today?

The Chairman: Do you want anyone in particular to answer that question for you, Senator Dallaire?

Senator Dallaire: I was looking to Mr. Wallace.

Mr. Wallace: One can always do a better job on reports. I will tell you a little bit about the current overall structure. Some reports produced by different departments, including CIDA, are monthly and are now web-enabled. We change our website on Afghanistan report results virtually weekly now, so there is a sense of reporting that goes through different cycles. Some of these specialized reports are monthly in nature. Other reports include plans, priorities and the departmental performance report.

[Translation]

These are annual reports that are produced in the spring and fall. They have to do with the agency's plans and performance over the period in question.

Furthermore, we produce a statistical report, and it requires more time to prepare. We have to wait for the results that come, in part, from multilateral agencies, which have a different reporting cycle — in particular, agencies in the United Nations system and international financial institutions. It takes several months to obtain this data, which affects our capacity to consolidate this information and provide a complete picture of the situation.

Within Canadian government departments, it is easy to produce reports quickly. However, gathering data from approximately 100 different international institutions always means delays, which affect the production of our own reports.

That being said, there may be ways of improving the situation. We could produce interim reports so as to speed up the process.

[English]

The issue of reporting is one for which, looking at the whole picture, clearly there is room for improvement in a number of areas. There are items on different cycles, from monthly to quarterly to annually, and you can look at what that provides and for what purpose. Fundamentally, the purpose is exactly what the senator was saying, to show what Canada is doing, the activities it has undertaken, and the results that are produced with activity in those resources.

With respect to the issue of consultation and the question of interpretations and legal risk, I will ask my colleague and senior counsel to address that.

[Translation]

Ms. Verdon: Regarding consultations, clause 4 requires the minister to consult. Beforehand, it was at the minister's discretion. Now the minister is required to conduct consultations, otherwise he runs a number of risks. He must consult above all so that he has something on which to base the opinion that he has to form pursuant to clause 4(1) of the bill. He must form this opinion when he grants development assistance. He could provide development assistance hundreds or even thousands of times. So the clause has to be interpreted in this manner. The minister must consult quite often, otherwise a court could rule that he has not fulfilled his obligation pursuant to the clause.

Senator Dallaire: He is required to do so pursuant to a piece of legislation that states that he is accountable to Parliament, not to a Canadian or international criminal court.

Given this context, we are asking him, first of all, to reduce poverty by taking aim at a number of targets, and second, to carry out consultations, with proof that he has indeed consulted. Then, parliamentarians will have to judge whether or not he has met his obligations. This review will be done on the basis of an analysis of this component, not on the basis of each $50,000 project for which he is obliged to consult. That interpretation is consistent with the spirit of the legislation and is not meant to address the concerns that you raise.

[English]

I come back to our Bretton Woods exercise and the document that you produced.

[Translation]

The statement reads: "This annual report needs to present a clearer picture.'' Here the minister is speaking of the Canadian government. Then the statement continues, saying that this view was strongly reiterated by organizations including the International Monetary Fund and the World Bank. So they share this point of view. It does say, all the same, that Canada must respect the confidentiality policies of its institutions.

I did not see anything that says that we are putting confidentiality at risk. No one has indicated that confidential information from these institutions will have to be disclosed.

If you do not mind, I would like to raise the following points:

[English]

Paragraph 5(3)(a) in the bill talks about a summary of representation, which is more open to interpretation than the last point about the position taken by Canada on any resolution that is adopted by the board of governors, and so on. It requires a summary characterization of the high-level general assessment. It did not ask for the word-for-word analysis of every interpretation.

Many member states of Bretton Woods Institution report on the approach to policy and priorities of the institution. The World Bank disclosure policy accepts that bank directors may release statements on their positions. Of course, there is the qualifier of confidentiality, which no one is asking for. Canada's current Bretton Woods report to Parliament, the one here, is committed to embrace that transparency.

I will conclude with this quote from the World Bank Disclosure Policy, if I may: "governments of member countries are free to release statements of their positions on matters considered by the Board.''

Therefore, we can obtain data without throwing the whole thing into a tizzy. Do you really think, the way it is written there, that we want the fundamental processes of those institutions to be undermined by our our desire for more transparency, or are we simply saying: Tell us what you are doing up there and inform us?

Mr. Flack: As we argued before the House committee, we did not think that was the intent of the legislation. Unfortunately, the introduction of the word "any'' pushes us in a different direction. It does not say "a summary of general representations made.'' It says "a summary of any representation made'' before the committee. Our legal counsel raised that as an enormous flag.

We agree with you completely on transparency and the attempt to open up the World Bank and the IMF. In fact, Canada was a leader, along with the U.K., in pushing for further disclosure. As you will see in our Bretton Woods report, we are pushing for further disclosure still in terms of those institutions opening up as many of their documents as possible, where there is now a presumption of disclosure for the vast majority of the documents. That has been, in large measure, the result of countries such as Canada and the United Kingdom pushing for those institutions to open up, and we absolutely support that.

We are saying to the committee that it is difficult for us to unilaterally take a further step of opening up what is, in effect, a cabinet meeting, and doing that alone. Indeed, our report in the Bretton Woods and Related Agreements Act and the United Kingdom's report are two of the best examples internationally of pushing the limits of disclosure. We did that carefully, in consultation with the World Bank and the International Monetary Fund, to ensure we did not cross any line.

We did not think the intent behind this provision was to do that. Our challenge is that we will be required to obey the law that is put forward. The law says that we need to provide a summary of any representation that is made. To give a practical example, if we have a bank policy discussion of exchange rates, that is a market-sensitive discussion that has the potential to be leaked. Exchange rate speculators understand where exchange rate policy may have an impact, and if that meeting was about exchange rate policy, I do not know how you could do a summary of any representation that did not explain where we came out on that.

To the extent it did — according to the executive directors there — it put them in a position where it would break their contractual obligation to the bank and to the fund not to release that confidential information. It could also damage third parties.

We agreed that we did not think that could possibly be the intent, but the words were different. That is why we were comforted that an amendment was proposed in the House that said nothing in this legislation should be taken to impact the confidentiality requirements. It may not have been sufficient from a legal perspective to cover all the situations, but it appeared that the House members recognized a problem here. Unfortunately, because some of the sections were shifted around, it looked as though one section was removed at the last minute. It was the section to which this amendment would be attached, and all the amendments associated with it went as well.

To be absolutely clear, we are fully supportive of the notion of transparency and opening up these institutions. For years, we have taken a leading role in doing just that. We are saying that there are limits to how far we can unilaterally go and ultimately, there are limits in how far we would want to go in terms of those cabinet-like discussions where we want a full and frank exchange. We do not want anyone pulling punches in those discussions because the purpose is to provide blunt advice to those individuals. In those cases, we do not want to provide summaries of those representations because the result of doing that would be to neuter our representations or lose the information.

We agree with the intent. We are asking senators to look at the language to determine whether it aligns with that intent and whether it would not risk, as our executive directors tell us, putting them in impossible positions.

The Chairman: I want to remind colleagues that we still have another session after this. We are truly going over my estimated time now.

Before I go to Senator Mahovlich, I want a point of clarification from Ms. Verdon on subclause 4(2) with respect to the consultation process.

What I hear you say, and I am not trying to put words in your mouth, as written, the consultation paragraph would compel or oblige the minister to consult. Is that your interpretation of that?

Ms. Verdon: Yes, subclause 4(2) obliges the minister to consult. Now, the minister does not have such an obligation. The minister may consult now, but under subclause 4(2), the minister shall consult.

The Chairman: I appreciate that.

Senator Mahovlich: I thank the witnesses for appearing. Mr. Flack, do you think the government feels that the more reports they receive, the more transparency they have? That is my question to you.

Mr. Sloan, you say Bill C-293 does not have a clear test to determine what is a contribution to poverty reduction and what is not. This lack of a clear test creates ambiguity, both legal and practical.'' Can you explain what "a contribution to poverty'' is?

Mr. Wallace, you are right, the perspectives of the poor are the most valuable. A committee that I am on sent me to Africa, and I was in the Congo. A lady there had to walk 10 miles for a bucket of water. I think if I asked her what poverty was all about, she would have explained it to me. It was an experience.

Mr. Flack: Briefly, I think better reports provide better transparency. That is why in our Bretton Woods report we made a real attempt to provide greater transparency this year and will attempt to continue to do that. If you want us to duplicate that in other vehicles, we can. I only point out that costs are associated with that.

Senator Mahovlich: Streamlining is important when fighting a war. I think poverty is kind of a battle for us.

Mr. Flack: I fully share that view. As you might imagine, the Department of Finance was interested, as was indicated in their budget document. We only highlight some of those areas that raised flags for us.

Senator Mahovlich: I found the same thing in hockey.

Mr. Sloan: With respect to the comment about the clearer test to determine what is the contribution to poverty reduction and what is not, I think, very much, the points raised by the chairman and Senator Segal go to the heart of the difficulty of clearly defining a term such as poverty reduction. The long and convoluted discussion inside the OECD to try to define what is official development assistance, what should be counted as official development assistance and what is not, and even though it might appear to be or is purported to be by some or others, I think it is a history we need to be aware of in trying to set out a test for what, in the future, we will determine to be official development assistance or not.

There is a long and difficult but genuine debate about how we define these terms.

The Chairman: Thank you. I will ask my colleagues who had put their names down for a second round if I could postpone that until the next portion and I will put them first on the list. We are really running out of time and we have somebody else waiting for us. I would like to suspend for two minutes.

Senator Corbin: Can I ask a point of clarification? I know you do not like this, but Mr. Flack has alluded to the Halifax Institute or the Halifax Initiative and he said they appeared here before us. I checked with the clerk. We have never seen these people. Can you tell us in two sentences who and what they are and what they strive to do?

Mr. Flack: My apologies: They appeared before the members of the other place. Halifax Initiative was set up in the aftermath of the then G7 summit in Halifax with a view to reporting on the transparency with which the Government of Canada reports on how it performs in development assistance. The Halifax Initiative is a collection of NGOs that provide a scorecard on how well we are reporting.

The Department of Finance for the five previous years, I believe, received a consistent D in our reporting. We went up to a B minus so we are not there yet.

That is the institute and they appeared before the House committee a couple of months ago.

Senator Corbin: Where does it operate from?

Mr. Flack: It is more of a virtual institute that has representatives all over. There is a representative in Ottawa, but as I understand it, it is not a large organization.

The Chairman: Thank you, senator. To our five guests, thank you for your clarity. Thank you for your contribution. I believe all our colleagues agree it was useful.

Honourable senators, welcome to the second portion of this meeting. We are continuing our study on Bill C-293, respecting the provision of the official development assistance abroad.

[Translation]

With us today is Lucien Bradet, President and CEO, Canadian Council on Africa, who appeared before our committee last June when we were conducting our study on Africa. We are pleased to have you with us again, Mr. Bradet.

[English]

The Canadian Council on Africa is dedicated to promoting trade and investment between the Canadian and African business communities with a focus on capacity building. CCAfrica is a member-driven, not-for-profit organization serving private and public sector organizations with business interests in Africa. I remind everyone that our witness will have seven minutes for his opening remarks and we will then move on to questions from members.

[Translation]

I will now give the floor to Mr. Bradet.

Lucien Bradet, President and CEO, Canadian Council on Africa (CCAfrica): Thank you very much, Mr. Chairman.

[English]

I hope it will not be too tiring for everyone to stay but we have an important message to bring to you. We thank you for inviting us. The Canadian Council on Africa has a clear mission working with the public and the private sectors for the economic development of Africa. That is our goal. This mission includes, as a direct result of its activities, the important objective of poverty reduction. There is no question about that in our mind. This is not a novel idea. If you read the OECD, and people here mentioned that before, the DAC definition, the official definition of ODA clearly states, "promoting the economic development and welfare of developing countries.'' It is the same for the African Development Bank. Its main objectives are property reduction and economic growth.

[Translation]

We truly find ourselves in a situation whereby everyone is in agreement on the objectives, or at least the major institutions.

[English]

Why would Canada enact a narrower definition than the above institutions that has been approved and discussed for years? Why would Canada leave to interpretation — or to the discretion of many of my friends, civil servants, or for that matter unclear "civil society consultations,'' and I do not understand how that could be done —the role of defining or deciding whether a proposed Canadian aid activity or project that is otherwise acceptable to the international multilateral or other national aid agencies is noble enough for Canada to undertake?

Unfortunately, the proposed act reads and sounds like that. No organization concerned about Africa is against poverty reduction. I understand Senator Mahovlich and others who went to Africa. I am in Africa every three or four months. I see poverty everywhere and we must fight and work to eliminate it. Everyone wants less poverty, more growth, more jobs, more schools, more food and less illness. Everyone wants to promote a better quality of life in the developing world. Ultimately, then, what is the purpose of this bill?

If Canada was visionary, first of all, apart from my text, they would have accepted your report and many of its recommendations. That is beside the point — I thought it was a good report. If Canada was bold and wished to be a world leader, it would change a few words in subclause 2(1) regarding the purpose. Instead of reading: "with a central focus on poverty reduction and in a manner that is consistent with Canadian values,'' it would read: "with a central focus on prosperity and wealth creation in a manner that is consistent with Canadian values.''

This is a positive aspect of the problems of the developing world. This would be a bold, clear signal that Canada wants to ensure economic development occurs in Africa. I have thought a long time about that sentence, although I do not know if my friend from CIDA would agree, the real meaning of that word "development'' in the title of CIDA, would be meaningful.

Wealth creation means assistance to Africa or other nations to build economies that become self-sustaining. Is that not the goal of every aid agency in the world? We can see scenarios where focusing on poverty reduction may actually constrain important efforts by Canada. I know that many of you are in the field of law. Can the argument be made that training judges, usually any country's elite, reduces poverty? Will important projects that provide an enabling environment for the rule of law, which is a critical step to stimulate wealth creation over the long term and is certainly in line with Canadian values, pass the ambiguous and undefined poverty reduction test?

We do not know when reading the act. The only definition not provided in the act's interpretation section is poverty reduction. I was surprised when I read the act and wondered where the definition was? It is nowhere to be seen. It is inferred but not defined.

What is it? Are there different standards for different continents? We are poor in Canada but if our poor were in Africa, would they be rich? I do not know. Maybe they would be or maybe not. If you do not define this critical term, it is left to a doubtful process of consultation that may produce, we guess, guidelines and precedents that remain in place only until the next government. I can assure you that. Canada cannot manage billions of dollars in this manner. There is a clause that nobody talked about tonight and I was surprised. Why?

An organization so admired by Canadians called the International Development Research Centre, IRDC, seems to be out of touch with that problem because they have a special clause. I do not understand why. Do they want to do something not correct? I do not think so, but they are exempt from clause 4(4). It leaves a doubt in the mind of the reader.

Last week we had the chief economist of the African Development Bank. The subject of his presentation was poverty reduction. The economic growth of Africa; infrastructure, energy, communication, education were at the top of the agenda. This week CCAfrica as we speak is co-hosting seminars with Federal Business Development Bank in Toronto, Calgary and Vancouver. The main discussion was what African countries want; economic growth and wealth creation.

These aspirations are the same ones that our own governments, provincial and federal, focus on day-in and day-out. Why should I preach something else for African or other countries with the same needs?

Fundamentally, will anything in this bill improve Canada's ability to work with developing country partners? Will it make our aid work harder, smarter and faster to stimulate self-sustaining economies in the developing world? We simply do not see it. As written, the legislation seems poised to increase confusion and bureaucratic process. I was in the bureaucracy for many years and that thing coming down from above would create a bureaucratic process on a huge scale. In fact, we are worried that it will actually constrain and decelerate the tempo of the ODA planning and implementation process. At a time when cutting-edge and out-of-the box thinking is needed in Canada's approach to Africa — you said this clearly in your report a few weeks ago — and other developing areas, this legislation seems to take a backwards step.

It is a bit harsh in our view. We say so because we believe strongly that Canada must be open to new ways of doing things, with more transparency. If there are questions about it, I will be pleased to answer them too.

The Chairman: No one could accuse you of not being clear.

Mr. Bradet: Thank you very much.

Senator Corbin: I have a brief question, Mr. Chairman.

[Translation]

Senator Corbin: Thank you for your presentation, Mr. Bradet. I share — and I would even almost dare say that I have shared right from the outset — your concern about this bill.

However, I did not understand what you were implying when you said:

[English]

The blanket waiver for the International Development Research Centre, IRDC, seems to point out the problems with a poverty reduction focus in Canadian ODA.

[Translation]

Could you be more explicit? I have not grasped what you are trying to say. Could it be that I cannot read the English?

Mr. Bradet: According to some people, poverty reduction covers all aspects: the economy, social considerations and so on. If that is so, then why did the IDRC ask for an exemption? If the proposal I am making does not cover everything, they are afraid and so they are asking for an exemption.

We may carry out economic activities or technology training activities — they also do a lot of that — or research with African or South American universities, and such activities may not pass the test. You see some people who have been doing this for 20 years.

[English]

How many years have they been in the development business? They have been there for many years. They are afraid, so much so that they ask for an exemption. I do not understand that. I am not in on the secret. I do not know.

[Translation]

When I read that, I immediately became concerned. To my mind, it was like a red flag, there was something that was not right here.

Senator Corbin: What is the mandate of this research institute? Is it not basically research?

Mr. Bradet: Its mandate is to work very closely with developing countries on all kinds of issues, ranging from governance and telecommunications — they are currently doing a lot of work in that area in Africa — to joint research conducted by Canada and African or South American universities. They have an international board of governors, unless I am mistaken — Canadians and non-Canadians — and they do very commendable work, and it is 100 per cent funded by the Canadian government. It is a Canadian government agency; it is not a private organization.

Senator Corbin: It is an at-arm's-length organization.

Mr. Bradet: Yes, but paid for by the taxpayer.

Senator Corbin: From a statutory point of view, it is independent. You must read the documents as they are written. You want to involve them in development, but that is not their mandate, that is not their fundamental role. Their fundamental role is research.

Mr. Bradet: If they are outside government as a non-governmental institute, they have an exemption. I do not understand that any better, but I agree with you. But I do not understand why.

Senator Corbin: I am trying to understand your vision of the role and mandate of this organization, and I think that we are not in agreement.

Mr. Bradet: That is all right.

[English]

Senator Andreychuk: We have heard you before at this committee. You have always given us a different perspective and I appreciate that.

I was and still am part of the Make Poverty History campaign. It was targeted to a specific, understood target from the 1970s that no government had matched or reached. It was measurable and it was understood, so I welcomed that initiative in the NGO community and the Canadian broader community.

What troubles me in the bill is that we are back to the question of what is poverty, and is wealth creation a way of achieving poverty reduction and all those issues — you put it out when you alluded to the report from this committee. Is it jobs; is it trade; is it development; is it sustainable development; and is it environment issues? How do we assist — and I hope the key is on assist — African nations resuming a position within the world that is tenable, which it is not at the moment, in my opinion?

When you work in Africa, are you concerned about the phrase "poverty reduction,'' because you represent businesses, right?

Mr. Bradet: When you say business, I represent universities, colleges, governments and all that; a large group of people concerned with economic development. Business is about half our members. What about the other half? It is not only business.

Senator Andreychuk: That is what I want to find out. You have a specific mandate and mission in Africa; but within that mission, how do you address poverty reduction, or do you?

Mr. Bradet: Activities that are undertaken by Canadians — be it business, private sector or universities and colleges and so forth — are doing what Canada has done for its own economy. They are developing the economy in Africa by transfer of technology, by doing business, by training people and by helping governance. When the University of Ottawa works on development for the legal system in Senegal, for me it is an activity of developing an economy and developing a country.

Senator Segal said in the previous session that the question that is the most important one to address is, how do we put in an act something that does not exist at this point in time? Our aid program does not have any act or statute, except what you have noted that in your report. For us, if this bill were to pass, we would have it for years to come and it will be problematic in many instances.

I will give you a small history. About two weeks ago, the OECD committee came to evaluate the Canadian aid program. There was a meeting and there were 10 NGOs — one working with the private sector, which was us, and nine others working mainly in humanitarian things.

The OECD gentleman asked, are you consulted on policies of CIDA? Everyone said yes, except us, because we are never consulted. I guarantee you if that thing passes, I do not know what they will do about all the projects, how they will manage them, but definitely the situation will become chaotic rapidly. The language is so strong that nobody will be able to get away with it. For us, we do not know why we should agree with that. We do not want to agree with that because it is not the right approach.

Your prescription, or some of the recommendations you made, says to the government, please develop a strategy; please develop an act that would be comprehensive. This is not comprehensive.

Senator Andreychuk: I have advocated a legal framework where CIDA or the government would determine what they were capable of achieving in their development, present it to the Parliament, involve parliamentarians, seek their advice, consult others — stakeholders, whatever you want to call them — and then come back to assess whether they have accomplished those aims. In other words, there is the transparency of filing their accomplishments.

I take it you are saying you are not against that approach; you would be in favour of that, but you believe this bill could deflect from accomplishing that goal. Is that correct?

Mr. Bradet: Yes, by doing little of that job; and in a way that will confuse our program more that it is now. If you saw the presentation before mine, I have not seen many votes in favour. They cannot vote; they are civil servants and I understand that — they are in a difficult position. However, the questions that were asked point-blank sometimes were deflected in rapid answers. It is a difficult question to say no to, but I understand that.

[Translation]

Senator Dallaire: Mr. Bradet, you have made a number of rather interesting arguments. Initially, you began by saying that poverty reduction and economic growth are linked.

A few moments later, you said that prosperity and wealth creation, self-staining economies, are not compatible with the concept of poverty reduction. I am not an economist, nor am I a linguist. And you wondered whether the training of judges could be part of a plan to reduce poverty.

Imagine that someone invents something, and that he wants to sell his invention, but another person steals his idea because it has not been patented, and no one can put this thief in prison because there are no judges. I do not believe that such a situation would help create the kind of economic structure that will encourage people to do business in a legal manner.

When I look at poverty reduction and the definition of official development assistance, I see that the definition speaks of promoting the economic development and, necessarily, the welfare of countries.

That means that we do not want an upper class that makes money while everyone else works in difficult conditions. Rather, we are trying to build a middle class and increase people's standard of living. To do so, you need industries, you need infrastructure and you need jurisprudence.

One thing that I have a problem with is the establishment of armies. We have seen that some countries are taking money that is intended for development and using it for security, setting levels of security that are beyond their needs. This is what we are trying to do away with.

But within the context of poverty, the idea is to create employment for people. That is how we will eliminate poverty and create this middle class. I do not see how we can put down industry, which wants to take action with many initiatives to help people improve their standard of living and provide them with the tools to do so.

Mr. Bradet: Your description of what Canadian assistance should be is excellent. The only problem that I have with this description is that in a well-drafted act that deals with the mandate of CIDA, we would find all the words that you have just spoken. Unfortunately, all we find here is "poverty reduction.'' I have no problem with what you have said, I completely agree. I would emphasize the wars, the armies. And everything else should be part of CIDA's clearly set-out mandate. But at this point, all I have is one expression, just one of the various things you mentioned, and that is what is going to create ambiguity.

Senator Dallaire: I take the millennium development goals and other people describe everything that I have just said, that poverty reduction paves the way towards them, and that we have to take that direction. From this point of view, I do not see how this reduces our capacity to operate.

The aim of this bill is certainly not to reform CIDA, but rather, to set a policy direction that the agency currently does not have. Basically, we provide humanitarian assistance with education projects spanning 25 years. But behind all of that, there is no one to maintain the building where people are trying to teach the kids.

Do you not think that we should define at least one preliminary general orientation and ask the people to try to build something? Later on, we can define the reform measures much more specifically.

Mr. Bradet: In this case, I suggest that the term "poverty reduction'' in the legislation should be translated into the terms that you used. I would have no problem with that. Strike out "poverty reduction'' and give a list of the potential consequences. If you focus on social issues, on the general welfare of the population, on economic development, I have no problem with including this definition in the legislation, because it is not there now. I agree with your way of putting things.

Unfortunately, I do not see it reflected in the legislation. If I do not see it, trust me, they will not see it in Gatineau or in Ottawa. Everyone will have the same discussion that you are having and there will be no end to it.

I know that the intention is good, but it is not well expressed. As for consultation, you can always say that the legislation is not very restrictive, but let me repeat that the language is restrictive, unfortunately.

Senator Dallaire: Nevertheless, you do consult your clients. I can no longer see how ministers can fabricate solutions. In the past, bridges were built in deserts because they wanted to provide work for engineering companies here in Canada. Those times are over.

Do you consider that poverty reduction is a way to improve everyone's standard of living, as the Millenium Project seeks to do?

Mr. Bradet: I do not think that it applies to our present discussion or to the document. I do not see where the things you are referring to are reflected. I am not opposed to your interpretation, but I simply do not see it reflected in the bill, and it worries me. That is my problem.

[English]

The Chairman: With the passion held by two fine gentlemen such as Senator Dallaire and Mr. Bradet, we could go on all night.

[Translation]

Senator Segal: First, I want to thank Mr. Bradet for his very clear description of what is not working. Your suggestions are very clear. They will help us enormously in our clause-by-clause study.

[English]

Mr. Bradet, I would like to step back a bit from the explicit words that you find problematic in the bill and go to your last paragraph, which asks: Will anything in this bill improve our ability to work with developing country partners? Will it make our aid work harder, smarter, faster, et cetera? I would like to link that with your testimony, Mr. Bradet, before this committee when we considered the matter of Africa.

You advanced the view — not an unfair interpretation — that, grosso modo, we were not as sophisticated as some other countries in the way in which they mixed constructive aid projects that developed opportunities for countries that are targeted, "les pays sont ciblés,'' and the constructive links with other parts of Canadian society such as universities, businesses, et cetera, that can be part of a follow-on relationship to assist in the wealth creation and trade side. Can you stand back and give us a sense of whether this legislation, as worded or even as amended as you suggest in your presentation on behalf of CCAfrica, will assist us with the spectrum of moving to that more sophisticated and more effective aid delivery? Will it be neutral or, as I think you suggest in the last two paragraphs of your presentation, will it raise more fundamental problems that are not anticipated now by the drafters of the bill?

[Translation]

Mr. Bradet: That a wide-ranging question. I would choose terms whereby international assistance would help countries to have self-sustaining economies, which would be better for people. There would be fewer poor people and everyone would be happier.

[English]

Without question, it would be more difficult. The rules put in place would make it more difficult to deliver aid. It is difficult to deliver aid now but it would be harder.

[Translation]

Senator Dallaire says that we should not worry because the minister will not consult everyone. However, I must say that, unfortunately, those are the words. I did not invent those words. We heard lawyers who were very clear about this.

Perhaps the intention is not reflected in the text. Therefore, it will be harder. However, I am not sure if it will be smarter.

Recently, I read three or four reports stating that in the developed or Western world, for the past 10 or 15 years or so, shortcomings are being detected mainly in the infrastructures in Africa, Latin America and other places. Canada does not touch any of this. It maintains that this is not its problem and that it is up to others to solve it.

When I see, in Luanda, Angola, the Democratic Republic of the Congo and other places, young people deprived of drinking water, mothers deprived of acceptable health services, I see that there is a problem with infrastructure. In my opinion, this is exactly what Canada should focus on. This is what the term "smarter'' means.

CIDA does not like to hear about infrastructure problems because they do not look at things in that way.

[English]

Faster? There is no question that this will slow the process.

[Translation]

The bill says that the minister must hold consultations. CIDA has between 1,100 and 1,600 employees. Up to 90 per cent is delegated to the lower echelons. The report tabled in the Senate rightly suggests that there are too many people in Ottawa and not enough people in the field.

With greater delegation, more people in the field, a follow-up by the minister and more consultations, the process will grind down to a snail's pace.

In my opinion, those three elements really create serious problems stemming from the current legislation. Will these provisions provide more transparency? The government will have to publish its report no later than 12 months after the end of the fiscal year. Many things can happen in a year and even more in two and a half years. What kind of transparency is this!

Senator Mahovlich asked whether things would be clarified by making more reports. Things will not become any clearer. They will be just as ambiguous as they are now and the problem will not be solved.

Every question is subject to the Access to Information Act. It takes weeks to get any information and it is given out one drop at a time, despite the Bretton Woods report.

I, for one, believe that we need legislation for foreign aid, but it must be clearer and more complete. Among other things, we should come back to your report, which proposes some very important solutions.

I do not want to do without legislation, and I do not want any omissions in it, as suggested here. It all depends on the way in which the text is drafted and the provisions are described. We do not object to having legislation. To the contrary, we have been asking for legislation for the past four or five years.

[English]

Senator Mahovlich: Thank you for appearing, Mr. Bradet. You mentioned that there will be increased confusion. A nephew of mine went 35 years ago to teach in the Congo. I guess he was a draftsman and he was teaching the young boys drafting in school. Can you tell me if he taught anybody or if those children are active today? When I went over to Africa, I was confused. There is still confusion over there. Have we made any progress in 35 years?

Mr. Bradet: Yes, I think we have made a lot of progress. As an example, 35 years ago I was on the school benches of the National University of Rwanda, and I graduated from that university. There were 400 students there. Senator Dallaire will be able to witness what I say here. I went there last year, and they have 9,000 students now and many faculties and new buildings. All of that was created by the Canadian aid system in the 1960s and 1970s.

The answer is yes. If we do it right, it works. I am a product of Africa, a tiny bit.

Senator Dallaire: CIDA built the university.

Mr. Bradet: That is right. Today, it is a beautiful university. Rwanda is a tiny country, but they now have three universities, and the aid is working. I know there are many problems. One of the best things you can do is create jobs. A small company in Montreal that retreads tires made three investments: one in Rwanda, one in Mali and one in Senegal. Everywhere they went, they created 100 jobs to retread tires. The technology has moved there, the know-how was moved there, and the training has moved there. To me, that is economic development at its best. How many white people like us are there? A couple. The rest are all Africans making a living above the poverty level.

Senator Mahovlich: Your idea is to have more people in the field instead of having them checking reports here in Canada?

Mr. Bradet: Yes and no. I do not think the people will make the difference. The law and the regulations will make the difference. I will provide another example. CIDA-INC is the Canadian program. This program has been in existence for 28 years. For the last five or six years, it has been going down rapidly like a rock. We are totally dismayed by that. The reason is simple. When you ask anybody that dealt with that program over the last five years, they say, "I cannot go there anymore because it will cost me more money to make a proposal than I am asking for.'' They ask for an environmental study and other things. At the end of the day, nobody wants to touch it. You strangle some of the good stuff we have, so we do not have people wanting to do that anymore. It is unfortunate. Companies in other countries are doing that galore. I feel bad about that. I can tell you later what they are doing with programs like that, and I find it totally unacceptable.

Senator Corbin: I want to test Mr. Bradet's patience a little more. The U.K. Department for International Development, quoting here from a document, is the part of the U.K. government that manages Britain's aid to poor countries and works to eliminate extreme poverty. They are headed by a cabinet minister, one of the senior ministers in the government. To me that is important. This leadership reflects how important the government sees reducing poverty around the world. It has two headquarters, one in London and one near Glasgow, and 36 offices overseas. It also has over 2,500 staff, almost half of whom work abroad. My question is, is that a ratio that Canada could strive for?

Mr. Bradet: I think so. If you look at the trend of CIDA government-to-government support and moving large sums of money to multilateral organizations, we conducted a study that shows that, in the last five years, money now spent in Africa that goes directly to government or to multilateral organizations went from about 40 per cent to about 85 per cent. If you follow that logic, moving the money outside for a program of four or five years, the best way to administer that money is by having people in the location or in the country provide more flexibility and respond more to the needs of the local people, as opposed to managing all or most of it from Ottawa. I agree with you that the proportion you are talking about, fifty-fifty, would make more sense to me. I have not conducted a study, but there is a balance that is not right here. With the transfer of those major sums, the human resources did not follow, if you look at it that way.

Senator Corbin: Thank you.

The Chairman: Thank you, Mr. Bradet. We want to express our gratitude for being so patient and understanding about our time challenges. Thank you for staying late. Particularly, I want to express our thanks for sharing your valuable African experience. You have lived it. As you have said, you are a product of Africa. Your evidence will enhance our knowledge and make a valuable contribution to our report.

The committee adjourned.