THE STANDING COMMITTEE ON INTERNAL ECONOMY, BUDGETS AND ADMINISTRATION
OTTAWA, Thursday, November 29, 2018
The Standing Committee on Internal Economy, Budgets and Administration met this day at 8:30 a.m., in public and in camera, pursuant to rule 12-7(1), for the consideration of financial and administrative matters.
Senator Sabi Marwah (Chair) in the chair.
The Chair: Good morning, everyone. Welcome to the Standing Committee on Internal Economy, Budgets and Administration. My name is Sabi Marwah; I have the privilege of serving as chair of this committee.
For the benefit of those on the webcast or phone, I would ask each of the senators present to introduce themselves.
Senator Munson: Jim Munson, Ontario.
Senator Wetston: Howard Wetston, Ontario.
Senator Forest: Éric Forest from the Gulf region of Quebec.
Senator Mitchell: Grant Mitchell, Alberta.
Senator Dawson: Dennis Dawson from Quebec.
Senator Moncion: Lucie Moncion from Ontario.
Senator Verner: Josée Verner from Quebec.
Senator Tannas: Scott Tannas, Alberta.
Senator Plett: Donald Plett, Manitoba.
Senator Saint-Germain: Raymonde Saint-Germain from Quebec.
Senator Marshall: Elizabeth Marshall, Newfoundland and Labrador.
Senator Tkachuk: David Tkachuk, Saskatchewan.
Senator Batters: Denise Batters, Saskatchewan, Deputy Chair.
The Chair: The first item on the agenda is the adoption of the minutes from November 22, which is in your package. Are there any questions or changes?
If not, can I have a motion to adopt the minutes? Thank you, Senator Saint-Germain.
Honourable senators, pursuant to the order adopted by the committee on April 19, 2018, the Advisory Working Group on Artwork and Heritage was appointed with a delegated authority to act on behalf of the committee on matters related to the Senate policy on heritage assets and works of art. The working group is required to report quarterly to CIBA.
The second report of the working group is placed before you for your information, and Senators Bovey, Eaton and Joyal are here to give you a brief overview of the report and answer any questions you may have.
Hon. Patricia Bovey, Senator, Senate of Canada: Thank you, chair, and thank you all for receiving us today.
I want to say our focus on this working group has been both short term and long term. The short-term focus has been the move; the long-term focus is going forward in the public trust because this is a significant heritage collection.
The work in our heritage collection will be decanted from Centre Block to the Senate of Canada Building, and some to storage, and this is going to be done on a phased basis. I’d like to thank our curatorial staff, who have flowed with the changing dates and planned it very systematically.
The strategy objectives include minimizing the risk of loss or damage to the collection and supporting Public Services and Procurement Canada’s timeline for the Centre Block rehabilitation.
The move of artwork and heritage furniture started in August 2018 and is going to continue through February 2019. I cannot underestimate the significance and work of moving a heritage collection. I’ve done it a number of times; it is complicated.
In special cases, some of the artwork will be removed from Centre Block after February 2019, and part of that is the Canadian War Museum’s collection of the war paintings in the Senate Chamber. To add to that, I’m sure you are, I am being asked by the public frequently what’s going to happen to those works. They need conservation. They’re owned by the War Museum, and the War Museum will be undertaking the conservation of those works over the next 10 years. I think it will take most of the 10 years to do it.
There’s been some talk of whether they should go on tour, being in the collection of the War Museum. That’s for the War Museum to decide. If they ask my professional opinion, I would say no, they’re too fragile and large. Together let’s work on a systematic way to make sure the public has access to them, including an exhibition at the War Museum. I recently have done a video on those works that is on the Senate website.
The planning principles for the heritage collection’s decant from Centre Block were approved by our committee. As you know, I spoke of this in the chamber, I have visited the new storage site, and it meets the standards. Yesterday I got the particulate report — the dust report — I’ve been looking for from that centre. It’s very encouraging, but I want to keep monitoring one aspect that is encouraging.
The principles of moving this collection were required to be put in place and the committee has been working very hard on that. I thank my colleagues for that.
I’d like continued measurements for temperature, humidity control and dust particulates for the GCC because it takes some time for a building to acclimatize. From my perspective, I would like to monitor that.
Hon. Nicole Eaton, Senator, Senate of Canada: These planning principles — because there can be delays and continuing changes — will be used to guide any further changes to the timeline. The strategy allows Property and Services to quickly adapt the timeline to respond to delays in the interim location readiness. We’ve all heard there are a few problems.
Turning to PSPC Centre Block investigations work and weather conditions. Art and artifact conservators have reviewed the condition of artworks and heritage furniture to be removed from Centre Block and provided recommendations on stabilization, packing and transportation. Some of them will be difficult to get through the doors if you think of the size of the pictures. How do they take them out? We’ve had extensive conversations on that.
Conservators completed the stabilization treatments between August and November of this year. Fine art and heritage furniture handlers were hired to package and move the Senate’s heritage collection based on the conservator’s recommendations.
The interim locations need to be in a state to accept the artwork and heritage furniture. Senator Bovey has just talked about the storage, which seems to be in good shape.
Hon. Serge Joyal, P.C., Senator, Senate of Canada: Thank you, Senator Eaton. There are four points I want to bring to the attention of the honourable senators. The first is we have reviewed the procedure of moving that would minimize risk and damage. Because a painting that has been on the wall for 50 or 100 years, when you take them off the wall, you realize the backing is not stable. We have reviewed the procedure to make sure that the works are stabilized before they’re moved so we minimize the risk of damages during the move and the re-installation. That was one of our first priorities.
Our second priority was to make sure that there would be oversight at each checking point, meaning there would be someone, besides the movers, to make sure the movers properly handle the objects. Any one of us who has moved understands what it means.
The people come, and they might not really handle the objects with care. So there has to be someone to watch at the point of leaving the walls and at the point of re-installation so we make sure we have control of the procedure all along.
I want to insist on the third point. We want to ensure that the paintings or works of art moved first were those that were in the way of the others. When you start moving the fridge, it’s better to have moved the small objects in the corridor before you move the fridge so you don’t damage the small objects. We wanted to make sure the way was clear before the move takes place.
That’s an important element, and I have to say honourable senators have relied on their own personal experience of moving to make sure that the procedure that was developed was fair and minimized the risk and damages.
We are satisfied that the proper procedure is followed, implemented, and that they will be re-installed in the new building in a way that honourable senators will be satisfied and to keep the ambiance of the Senate as a chamber that pays attention to its history, heritage and meaning for Canadians.
Those were the objectives we wanted to satisfy. Thank you, honourable senators.
Senator Batters: You alluded to some of this in your opening remarks, but I’ve been surprised lately to see how many pieces of artwork have already been moved from relatively visible areas in Centre Block. I have heard a couple of your reasons, but maybe if you could explain that to people who have been touring around here and have noticed the same thing I have.
Senator Bovey: I’d be happy to address that, senator. I have to say that the changing timelines have complicated the move. One of the real issues for us, as you know, we’re now moving in the winter as opposed to the summer. When you’re moving works of heritage, you know that temperature and humidity causes the cracking of paintings. We’ve had to take into consideration what the issues are when moving these heritage objects in January.
Work had to be done to give them the proper backing so the backs could be protected, as much as we could, from the temperature and humidity. With great reluctance this work had to start while we were still sitting in the chamber, but I’m afraid we otherwise wouldn’t have the works in the other place when we come back. I think the staff has been very diligent in trying to start first with the works that are not on the public tour. I appreciate that the public tours have been compromised a bit, but you will notice it’s not a whole section that’s down. It may be one side of the wall, so the tour guides are focusing on the other side of the wall. The principles of the tours have remained the same.
Senator Eaton: Could I add that, because of all the pictures, there is not room for all the Speakers’ pictures, for instance. What we determined, as a committee, it would be interesting for tours where we’re going to pick Speakers who changed history somewhat. The first woman Speaker, the first Speaker that something happened under. The historians and the art people looked and picked Speakers whom they could tell a good story about on the tours. Probably a lot of those were the first to be moved and to be prepared to go into the new centre.
Senator Batters: Will the most recent Speakers’ portraits continue to be in the new building?
Senator Eaton: Not necessarily. If they are part of a good story, yes. Other Speakers will be hung in a less visible, less public space down there, but there’s only so much space.
Senator Batters: It might be interesting for the public to see who it was in the last few years, though, including people who still sit.
Senator Tkachuk: Does it have to be a good story, or just an interesting story?
Senator Joyal: I’ll tell you the stories, Senator Tkachuk.
May I add something to Senator Batters’ question? I think there is another aspect I want to draw your attention to.
First of all, we wanted to make sure the condition of the works are checked before they are moved. I said earlier on, you cannot expect when you remove a painting that when the dust of 100 years is in the back, the canvas is not stabilized and the frame needs to be retouched a little, that you’re just going to take the painting from one wall and hang it on another one. We thought this was a good opportunity to check the conditions, do the stabilization work and make sure the work is in better condition, if I could use that expression, when it is hung in the other place because, as some honourable senators said, it may be 15 years. I’m looking at Senator Plett, as he is an expert on time extensions in the construction industry. We thought this was the right opportunity to check the work. We had to start earlier if we wanted to be on time when the new building is open for us. That is why you see there are some empty spots on the walls.
Senator Bovey: We’ve used this opportunity to upgrade the database of the collection. When it’s reinstalled you will see the artist has been given credit, as well as the Speakers or subjects, so we will be adhering to the Copyright Act of Canada. I think as a result of that approach we’ve taken with the database that the public record is in much better shape than it was when we began.
Senator Marshall: What is going to happen to the stained glass window with Queen Victoria and Queen Elizabeth with their pearls over the Senate entrance? Will that be removed?
Senator Joyal: No, they are part of this building. They might be removed during the construction if the condition of the construction presents a risk to their integrity, but they won’t be moved into the other building, no. There are no windows that offer the format where we could take them and put them in the background.
Senator Marshall: So they’ll protect that.
What is going to happen to the eight paintings in the Senate Chamber that we look at every day depicting scenes from the First World War? Are they going to the Conference Centre?
Senator Bovey: Those are the ones going back to the War Museum. They are owned by the War Museum. They will be conserved. I’m going out on a limb here. My sense is it could take 18 months to two years to conserve each one. They’re big. We all see how they’re cracked and we’ll have to take a look at the back of them, because so often the damage comes from the back. It’s a big project. They will be conserved while we have been decanted and they’ll come back to the chamber. When we move back —
Senator Marshall: We’ll get them back.
Senator Bovey: Yes.
Senator Wetston: I can’t help but make this comment because Senator Plett is an expert in construction, but he’s also an expert in making sure contractors get paid, we hope.
It’s a question about insurance. What are you doing about the risk? Who takes on the risk? Are you insuring the risk of the move, et cetera? I think you know where I’m coming from.
Senator Joyal: Public Works. Essentially it’s like anything that pertains to the Government of Canada. It’s Public Works that has that responsibility. If there is damage during the move, Public Works would have to decide if they would sue the movers or if it is their own people. You know the distinction, legally. We didn’t recommend that we subscribe to a particular insurance policy because we’re covered by Public Works’ responsibility.
Senator Saint-Germain: Senator Bovey, Senator Eaton and Senator Joyal, I would like to recognize the quality of your work and the professionalism of your approach. I am very impressed with your risk mitigation strategy. You have answered all the questions with great depth and credibility. You are among the busiest senators in the Senate. You came to work this summer. You have been working on this project for four months, and your work is not finished. We know how much time there is left to finalize the project. I also want to salute your concern to protect this collection, which is part of the public treasury, and to promote it to citizens across the country. Well done! You deserve our highest recognition.
Senator Joyal: Thank you.
Senator Bovey: Thank you.
Senator Joyal: We’ll keep the same position at the same salary, Mr. Chair.
The Chair: If there are no other questions, thank you, senators. We look forward to your next quarterly report.
Senator Eaton: As long as Senator Saint-Germain is allowed to thank us again.
The Chair: Before we move on to Item No. 3, I was remiss in not welcoming our two new members to CIBA, Senator Dean and Senator Wetston. Welcome to the committee.
I would also like to thank Senator Jaffer and Senator McCoy for their contribution to the committee and subcommittees. As you know, Senator Jaffer has been a member of this committee since the beginning of this parliamentary session and Senator McCoy officially became a member of CIBA in December 2016.
Item No. 3 is a report from the Audit Subcommittee. I invite Nathalie Charpentier, Comptroller and Deputy Chief Financial Officer, Finance and Procurement Directorate to the witness table. Welcome.
Senator Moncion, as chair of the subcommittee, will table its twelfth report dealing with — Senate quarterly financial report to the third quarter ending June 30. I understand Senator Moncion will be giving a presentation and that Nathalie will be available to answer any questions.
Senator Moncion: Dear senators, as chair of your Audit Subcommittee, I have the pleasure to table for information the Senate Financial Highlights Report for the first quarter of 2018-19 for the period ending June 30, 2018.
The committee was diligent in reviewing the report and several questions were asked to the finance team which were answered to our satisfaction. The dealing in the presentation of this report is due to exceptional circumstances caused by the scheduling constraints of the Audit Subcommittee and the priority given to the review of the financial statements.
This report has been redesigned to provide greater relevance to the information presented to senators in a new and dynamic format that enhances senators’ work and some of the key initiatives of Senate administration.
The report is issued on a quarterly basis. It is prepared by the Finance and Procurement Directorate and it is not audited. The objective of this report is to provide continuous information about the usage of the Senate budget authorities, actual expenditures and forecasted spending for the current year.
As a summary, the Senate budgetary authorities for 2018-19 are $109.1 million. The actual expenditures for the first quarter represent $19.8 million. Overall, based on best available information at the time that the report was prepared, the Senate is forecasting to spend $97.8 million for 2018-19, or close to 90 per cent of its budget. A surplus of $10.2 million over senators and committees’ budgets is expected due to the average number of senators forecasted to be lower than budgeted, 96 versus 103, and due to trends in spending that would not exceed an 85 per cent utilization rate of senators’ office budget.
For the committees, the surplus is due to the fact that some committee travel will be cancelled because of a change of plans and also due to the fact that some senators will not travel as planned.
The administration is forecasting a net surplus of $1 million, mainly due to salaries being at a lower level than planned, consistent with the previous year’s experience, which is due to vacancies or challenges in staffing.
I will now provide the committee with an overview of significant changes to budgetary expenditures.
Year-to-date actual expenditures, as at June 30, 2018, have increased compared to the prior year by 5 per cent. The more significant changes occurred in four expenditure categories. Page 8 of the report provides information on the most significant changes.
For the first category, “personnel,” costs increased by $1 million due to the new rates that were approved for unrepresented employees of the Senate administration, senators’ and house officers’ employees and unionized employees.
For the second category, “transportation and telecommunications,” costs decreased by $300,000 compared to the same quarter of previous fiscal year due to a reduction of senators’ travel, including Senate committees’ travel.
For the third category, “professional and special services,, costs increased by $0.2 million. This increase is mainly attributable to the increase in legal services and management consulting services, explained by the reorganization of the Human Resources Directorate.
Consistent with past practice, our quarterly financial reports lists under section 4 the key risks and uncertainties that may be monitored and mitigated.
This concludes my presentation of the financial highlights of the first quarter ended June 30, 2018. Thank you.
The Chair: Questions? Senator Batters.
Senator Batters: Thank you, Senator Moncion. I have a few questions, and perhaps the deputy CFO could answer them. On page 5 of the financial highlights, under the “budget authority summary,” it talks about how 32.5 full-time employees were added for the Senate administration to support its mandate and priorities. So this is not senators’ staff. This is Senate administration. I note that a previous page mentions that there are 412 Senate administration employees. That’s a big increase. Can you tell us more about that? What types of areas and employees? Why such a large increase over the past year?
Nathalie Charpentier, Comptroller and Deputy Chief Financial Officer, Finance and Procurement Directorate, Senate of Canada: Thank you, senator. That is a really good question. However I don’t have the detailed information about the 32.5 FTEs with me, but I would be able to provide the information to the committee.
Senator Moncion: In last year’s budget, there was this staff that were added to the amount, so it’s in last year’s financial statements.
Senator Batters: I think we need to have some detail about that. What particular branches and that sort of thing, rather than simply reference to a document that we don’t have in front of us right now.
There are a couple of other points that I wanted to raise as well. I notice on the following page, 6 of 13, that in this particular quarterly financial statement, it talks about additional funding for house officers, caucuses and groups. That equates to $400,000 more, and then there is also a savings of $400,000 because of the significant increase in senators’ pension contributions that we’re all making towards our pensions as was put into place several years ago. So we’re doing our part to make sure that’s taken care of. Thank you.
Senator Tannas: First of all, thank you for the new format. I think this is great. I think it will be easier for curious Canadians to get to the heart of their questions, so congratulations. I suspect our Communications Directorate had a hand in this as well, but maybe not. If not, somebody has a career in communications, because this is really great.
I wanted to ask a question and point senators to the appendix. We refer to knowledgeable-client funding. This, as I understand it, is a program of Public Works. Is that right, Nathalie? If we’re the client, Public Works, if we are knowledgeable and have expertise, we can actually have our employees subsidized to the extent that they are working on a Public Works project, which many of our employees have done, moving to the Government Conference Centre, now the Senate of Canada Building.
Do you have at your fingertips what the knowledgeable-client funding amount is?
Ms. Charpentier: No.
Senator Tannas: Okay. Could you next quarter? It’s not urgent, but I think we need to be better educated on this. What are the ramifications in 2019 in regard to staff who will no longer be subsidized? What happens to them and their costs if they’re sticking around? How does that tie into the 2019-20 estimates? Thank you.
Senator Marshall: I don’t have a question for today. I like the new format. Since this is for the first quarter, the next quarter, I would like to see some information on the work that’s being done on our IT systems, because I think human resources last year went significantly over budget. So next time maybe we can get some information on that. But I like the format. Thank you very much.
Senator Dean: Just very briefly staying on Appendix A below “knowledgeable-client funding,” I see a reference to succession planning and talent management. Members will be hearing a lot from me about human resources management and development in this place. We’ve seen the impressive literature from our Human Resources colleagues which includes succession planning and talent management. I, among others, are going to make sure that this is more than a label, more than a PowerPoint slide in a deck with lovely colours and pictures, and that we make it real in this place.
There is a huge opportunity in this organization to do a better job on appointing, developing and nurturing the professional staff that work in here. I’m glad to see this flagged, but I think we’re collectively going to have to move away from flagging things to thinking about them very seriously and taking HR development as seriously as we possibly can.
I’ll leave it at that. I’m glad to see the references, but when I see references to human resources developments, lights start going off. This is as important a reference in this document as anything else.
Senator Tkachuk: I have a comment just in reference to the question that Senator Batters raised. I understand that Director of Finance, the CFO, couldn’t be here for unfortunate circumstances, but if we would have them come to committee in case there is a conversation, not just sending information.
The Chair: Sure.
Senator Tkachuk: Thank you.
Senator Moncion: I wanted to add to Senator Dean’s comments that the Audit Subcommittee has started looking at these things, so we have received a first report coming from HR on employee turnover. There was a lot of information that was provided. Next week, when we look at the budget for 2019-20, there is a mention on staff development and the creation of a better framework for HR. So there are concerns, and they are being addressed.
The other component that has also been looked at by the Audit Subcommittee is everything that is related to the renewal of all the policies used in the day-to-day work. Most of them have not been reviewed for the last 10 years. There’s been a schedule put together so that all of the policies will be reviewed over the next, I think, three years. So they’ve been slated so that the work will be done progressively.
These are situations that have been addressed in the last few months, just to alleviate your concerns.
The Chair: Thank you. If there are no other questions, thank you to Nathalie and Senator Moncion. We will have you back soon on your response to the question.
Moving to Item No. 4, a request for proposal for toner. It’s to initiate a competitive procurement process for the purchase of toner cartridges.
I invite Ali Rostami to the witness table. Ali, you may begin your presentation.
Ali Rostami, Acting Director, Building Operations and Assets, Property and Services Directorate, Senate of Canada: Hello, senators. I’m here today to obtain the committee’s approval to proceed with an RFP process for the acquisition of toner cartridges.
Our current contract with our supplier, PrintersPlus, will expire on March 31, 2019. Even though there is another option year to be exercised under the contracted, the contract maximum amount has already been reached.
Last June, Property and Services completed an analysis of toner cartridge expenses, explaining the cost increase in recent years. Following this review, Property and Services, Information Services Directorate, and Finance and Procurement worked together to develop a five-point plan to reduce toner cartridge costs. This request considers the expected impact of this plan.
Based on historical expenditures and considering anticipated cost savings from the toner reduction initiative, it is estimated that a total of $900,000 may be incurred over a five-year term. Therefore, we are asking the committee to authorize the Property and Services Directorate to proceed with a competitive process to award a contract over a three-year period, with an option to extend for two additional years, for an estimated total of $900,000. Thank you.
The Chair: Any questions for Mr. Rostami?
Senator Marshall: The tender process, is that a public tender?
Mr. Rostami: Yes, senator.
Senator Marshall: Where do you advertise?
Mr. Rostami: We advertise online, similar to MERX. I believe it’s called Buy and Sell. It’s a public process — all the public is allowed to bid.
Senator Marshall: Who will be on the committee to evaluate the bids?
Mr. Rostami: We’re going to be putting together an evaluation committee that is composed of each directorate; there will be someone from Procurement and Finance, Building Services, ISD and anyone else who would like to participate as well.
Senator Marshall: The bids will be evaluated by the committee?
Mr. Rostami: Absolutely.
Senator Marshall: Will you come back with a recommendation, or will this just happen?
Mr. Rostami: Absolutely, I will.
Senator Marshall: It will come back?
Mr. Rostami: Yes, we will.
Senator Marshall: Thank you.
Senator Saint-Germain: Thank you for your brief. I am interested in your action plan to mitigate the additional cost increase, because we are at almost $1 million for five years, which is a lot of money. You have noticed — and I congratulate you on what you have done — that the cost has almost doubled over the past five years. What were the main reasons for this? What was your action plan? What are the control measures you are planning, in practice?
Mr. Rostami: Madam Senator, I don’t have the report with me right now, but I will be pleased to share it with the committee.
Senator Saint-Germain: I care about it. It’s a very important issue. It’s all about control in such a situation and, without wanting to micromanage, I think it’s important to have accountability for it.
Mr. Rostami: Absolutely.
The Chair: I believe Ms. Legault has some information on that, so please go ahead.
Pascale Legault, Chief Corporate Services Officer, and Clerk of the Standing Committee on Internal Economy, Budgets and Administration: Just to give you a bit of history on the increase in some expenses, first of all, there is a greater volume of consumption. Also, we noted that some of the devices were a number of years old. The renewal of some devices could generate savings in the amount of ink cartridges purchased.
We also noted that some clients used central printing services less, and there is a large economy of scale to be achieved when people have large documents to print. This is one of the solutions we want to promote. In the strategy, we want to raise awareness of printing costs and we will ensure that directors and senators know exactly what printing costs are associated with their offices. Awareness raising is one of the measures planned.
Finally, from an administrative point of view, we want to see if some devices are more efficient and effective, such as multitasking devices that could be integrated into the administration to generate additional savings.
Senator Saint-Germain: Awareness is important. When you see the costs, you can take steps, such as setting printers to print in black and white by default. This is a lot of money, and printing in colour isn’t always necessary. Thank you.
Senator Wetston: This is just a comment more than a question. I, personally, have been exploring printers, and they drive me crazy. Ink versus cartridges — they’re environmentally better; in other words, they’re much improved environmentally, ink versus cartridges. They last longer, and as you’re exploring the addition of new printers in the future, I wonder whether you would consider looking at ink versus cartridges.
The Chair: If there are no other questions to Mr. Rostami, I will need a mover for the following motion:
That the Property and Services Directorate is authorized to proceed with a competitive process to award a contract valued at more than $100,000 for the purchase of toner cartridges over a three-year period, with an option to extend for two additional years, for an estimated total of $900,000.
Is it agreed, honourable senators?
Hon. Senators: Agreed.
The Chair: Carried.
The next item is “other business.” Any other matters before we go in camera? Seeing none, we shall go in camera.
(The committee continued in camera.)