Proceedings of the Standing Senate Committee on
National Finance

Issue No. 10 - Evidence - June 1, 2016


OTTAWA, Wednesday, June 1, 2016

The Standing Senate Committee on National Finance met this day at 6:47 p.m. to examine the expenditures set out in Supplementary Estimates (A) for the fiscal year ending March 31, 2017.

Senator Larry W. Smith (Chair) in the chair.

[English]

The Chair: Good evening. It's great to see all of you here, colleagues and our witnesses, our friends, and, of course, I was told that there's the number two team in the back of all of the support people. But I want you all to know that you're not the number two team; you're number one in our hearts.

Welcome to the Standing Senate Committee on National Finance. Colleagues and members of the viewing public, the mandate of this committee is to examine matters relating to federal estimates generally, as well as to government finances.

My name is Larry Smith, senator from Quebec, and I chair the committee. Let me introduce, briefly, the other members of our group. We are small in number but large in heart.

[Translation]

To my left, fresh from La Presse ±

[English]

One of Canada's great newspapers. Now, we have a tablette form, of course. One of the great press people, from that trade, now a senator, and we're proud to have him with us, Senator André Pratte.

[Translation]

Welcome, André.

Senator Pratte: Good evening.

[English]

To my right, I should say the Speaker pro tempore of the Senate and a great member of our committee, Senator Nicole Eaton.

To her right, the former Auditor General — they used to call her the hammer because she could always break the Rock — Senator Elizabeth Marshall.

Senator Marshall: I know; I seem so nice too.

[Translation]

The Chair: Today we will continue our study of Supplementary Estimates (A) for the fiscal year ending March 31, 2017.

[English]

To review their expenditures in Supplementary Estimates (A), we have before us representatives from three departments.

First, from Employment and Social Development Canada, Alain Séguin. Welcome, Mr. Séguin. He is the Chief Financial Officer, Chief Financial Officer Branch. It's not like we're going to have another title to add to Mr. Séguin. We also have Jason Won, Deputy Chief Financial Officer, Chief Financial Officer Branch.

From Health Canada, we have Jamie Tibbetts, Assistant Deputy Minister and Chief Financial Officer, Chief Financial Officer Branch; and Sony Perron, Senior Assistant Deputy Minister, First Nations and Inuit Health Branch.

Finally, from Indigenous Affairs and Northern Development Canada, we welcome back our two veterans of the Senate Finance Committee: Paul Thoppil, Chief Financial Officer, Chief Financial Officer Sector; and Daniel Leclair, Director General, Community Infrastructure Branch, Regional Operations.

To my right, from British Columbia, we have another valued member of our group: Senator Richard Neufeld.

INAC and ESDC have brought more officials as backup, as I mentioned earlier, in case we have specific or technical questions. We thank you all for being here with us.

Each department has five minutes to make an opening statement, which will be followed by a question period. The floor is yours, gentlemen. We will start with Mr. Séguin.

Alain P. Séguin, Chief Financial Officer, Chief Financial Officer Branch, Employment and Social Development Canada: Thank you, Mr. Chair and members of the committee. I have a brief opening statement.

I'm pleased to be here again with you this evening in my capacity as Chief Financial Officer of Employment and Social Development Canada. I also have with me Jason Won, as we said, the Deputy Chief Financial Officer. As was mentioned, I also have senior executives of key areas of ESDC to help answer some of the program questions you may have.

The department delivers a range of programs and services that affect Canadians throughout their lives. The department provides seniors with basic income security, supports unemployed workers, helps students finance their post-secondary education and assists parents who are raising young children. We also have the mandate to maintain a strong, productive, healthy and competitive workplace within the federal jurisdiction through the labour program.

Service Canada delivers ESDC's programs to citizens, as well as other Government of Canada programs and services.

[Translation]

Allow me to present to the committee an overview of ESDC's portion of the 2016-17 Supplementary Estimates (A), tabled on May 10, 2016. Supplementary Estimates present information on spending requirements that were not ready in time for inclusion in the Main Estimates.

We use supplementary estimates to provide Parliament with an update on various statutory programs. Statutory items are included in the Estimates for information only, since Parliament has already approved the purpose of the expenditures and the terms and conditions under which they may be made through other legislation.

[English]

As part of our Supplementary Estimates (A), you will note the budgetary statutory forecast decreased by some $5.77 billion. This is mainly due to the Universal Child Care Benefit. The decrease in forecasted expenditures for the Universal Child Care Benefit is the result of Budget 2016's announcement of the new Canada Child Benefit. The new income-tested Canada Child Benefit will come into effect and replace the Universal Child Care Benefit on July 1, 2016.

Other than the statutory items, ESDC is seeking an additional $292.6 million in voted appropriations.

ESDC is requesting $112.2 million of funding for the Canada Summer Jobs Program. The government announced that it will invest $339 million over three years, starting in 2016-17, to create up to 35,000 additional jobs in each of the next three years under the Canada Summer Jobs Program. This investment will more than double the number of job opportunities supported by the program, bringing the total number of students served up to 70,000 each year.

[Translation]

Also, Budget 2016 announced $78 million in funding for the Social Infrastructure Fund in these supplementary estimates under three initiatives.

First, to strengthen the work of communities in their efforts to help homeless Canadians find stable housing, Budget 2016 announced an additional $111.8 million in funding for the Homelessness Partnering Strategy over two years. Of this, $57.5 million is being requested in the 2016-17 Supplementary Estimates (A).

Secondly, an additional $16.5 million in funding for the First Nations and Inuit Child Care Initiative under the Social Infrastructure Fund will address the immediate repair, rehabilitation, and equipment needs of existing on- reserve child care facilities.

Finally, $4 million in funding will be provided over two fiscal years for the Enabling Accessibility Fund program. This funding increase will support over 80 additional construction and renovation projects aimed at improving physical accessibility and safety for people with disabilities in communities across Canada. Of this, $2 million is being requested in the 2016-17 Supplementary Estimates (A).

[English]

Also, ESDC is requesting $52.3 million to renew the Skills and Partnership Fund. This proposal-based program funds indigenous organizations to work in partnership with employers to provide training for indigenous people to fill specific job vacancies in high-demand industries.

Budget 2016 also announced $50 million in additional funding for the Canada Job Fund agreements in 2016-17. The department is requesting $50 million in vote 5 in 2016-17 to be transferred to provinces and territories through the Canada Job Fund. This additional investment will help ensure unemployed and underemployed Canadians can access the training and supports they need to develop their skills and pursue opportunities for a better future.

Finally, ESDC is requesting $2.1 million for the Aboriginal Skills Employment Training Strategy, also known as ASETS. These resources will provide direct support to ASETS agreement-holders to build capacity, and enhance monitoring and accountability.

I hope this overview has given you a better understanding of the supplementary estimates of our department. My colleagues and I will be pleased to answer any questions you may have. Thank you.

Jamie Tibbetts, Assistant Deputy Minister and Chief Financial Officer, Chief Financial Officer Branch, Health Canada: Thank you, Mr. Chair and committee members. On behalf of Health Canada, I'm pleased to appear before you to discuss the proposed changes to spending from what was previously outlined in the Main Estimates 2016-17.

I would like to introduce my colleague, Mr. Sony Perron, the Senior Assistant Deputy Minister of the First Nations and Inuit Health Branch, who is here with me today. In my last appearance in March, I mentioned to you all that it would be my last time here before I retired, but here I am again in June. I promise that this will likely be the last, and I'm honoured to be here once again.

Allow me now to provide you with an overview of Health Canada's portion of Supplementary Estimates (A), tabled on May 10, 2016.

The department has put forward several important initiatives that will result in an increase in funding of $165.2 million. This means that Health Canada's total budget will be raised to almost $4 billion, at $3.92 billion, for the current fiscal year. Our requests are itemized on pages 2-26 and 2-27 of the Supplementary Estimates (A).

Most of the items included in these supplementary estimates are related to measures announced in Budget 2016 infrastructure spending initiatives.

In terms of specifics, the department is seeking voted appropriations of $94.9 million for affordable housing and social infrastructure projects. This includes $82.1 million to support the community health facility infrastructure, consisting of nursing stations, health centres, acute care facility complexes referred to locally as hospitals, and drug and alcohol treatment centres used in the delivery of health services and programs to First Nations on reserves. There's another $12.8 million in this package to repair and retrofit existing infrastructure associated with the Aboriginal Head Start On Reserve Program.

Another item that we've put forward related to Budget 2016 infrastructure spending is $25.6 million to renew and enhance the public health components of the First Nations Water and Wastewater Action Plan. Health Canada will continue providing public health services related to water and wastewater to 395 First Nation communities across Canada. This falls under the category for public transit, green infrastructure and existing programs mentioned in the budget, as laid out in supps.

Health is seeking another $25.4 million from Budget 2016 under the initiative called Addressing Climate Change and Air Pollution - Reducing Air Pollution. This renewal of funding allows Health Canada to continue at the same level to provide specific research on how air pollution impacts health, which underpins actions to reduce air pollutants, formerly done under the Clean Air Regulatory Agenda.

Health Canada also seeks $12.7 million as per Budget 2016 infrastructure spending initiatives to support a variety of infrastructure improvements, including assessments, remediations, activities on contaminated sites, upgrades to security to federal laboratories to address failing structural, electrical, mechanical, plumbing, ventilation and fire systems, and upgrades to Health Canada's office accommodation footprint. These investments will be made in the National Capital Region as well as in various regions across the country.

Another requested item is the request of $2.4 million to support Phase III of the Federal Contaminated Sites Action Plan announced in Budget 2015, which allows the custodial departments, not Health, to address the government's priority to protect the health and environment of Canadians by minimizing threats from pollution in these locations.

Finally, Health Canada is seeking a one-year renewal of $610,000 to maintain critical food safety activities that are part of the action plan to modernize food safety inspection in Canada.

[Translation]

As you know, Health Canada plays an important role in health care in Canada. Our department is constantly evolving in order to respond to emerging requirements and to adapt to new realities.

[English]

The funding in the Main Estimates will help us meet the challenges of today and better position us for the future.

Thank you for inviting me before the committee. My colleagues and I will be pleased to answer questions.

Paul Thoppil, Chief Financial Officer, Chief Financial Sector, Indigenous Affairs and Northern Development Canada: Thank you, Mr. Chair and honourable senators, for the invitation to discuss Supplementary Estimates (A) for the fiscal year 2016-17 for Indigenous Affairs and Northern Development Canada.

As you've noted, Mr. Chair, I'm here with my colleague, Director General Daniel Leclair, and I have colleagues here in support.

The Chair: Wave, all the colleagues in the back. We have one in the back? Is that it?

Mr. Thoppil: He's small but mighty.

The Chair: I see you've brought us a brick. Thank you very much. We always appreciate the thoroughness of your presentation.

[Translation]

Mr. Thoppil: First, I would like to draw the members' attention to the deck entitled 2016-2017 Supplementary Estimates (A), which I have tabled.

[English]

I will make reference to the deck through my presentation.

The supplementary estimates are primarily accessing the first year of historic investments announced in Budget 2016, totalling $8.4 billion over five years to support indigenous communities and the aspirations of indigenous peoples. Budget 2016 also announced $237 million over five years for indigenous-related initiatives in the North. This reflects the government's firm commitment to renew the relationship between Canada and indigenous peoples. The remaining funding will be accessed via future estimates.

[Translation]

On slide 2, with respect to financial highlights, Supplementary Estimates (A) includes a net increase of $1.2 billion for initiatives which will bring total investment for the department to about $8.8 billion for this fiscal year to address the needs of Indigenous people and Northerners.

[English]

It should be noted that the increase of $1.2 billion is comprised of $793 million related to Budget 2016 investments, primarily related to infrastructure to improve the quality of life for indigenous peoples; $205 million reflecting Budget 2015 initiatives, primarily for federal contaminated sites; and $240 million for other initiatives, related to claims activities and the Canadian High Arctic Research Station.

Turning to slide 3, with respect to voted expenditures, $205 million will flow through vote 1, operating expenditures, primarily for federal contaminated sites; $13 million as vote 5 for capital expenditures for the Canadian High Arctic Research Station; and $982 million through vote 10, grants and contributions, primarily for infrastructure projects and contaminated sites; as well as $30 million as vote 20, loans to First Nations in British Columbia for comprehensive land claims and incremental treaty and non-treaty agreements.

I will now describe briefly the major items.

Turning to slide 4, the largest item in the supplementary estimates, about $309 million, is required to support the delivery of water and wastewater servicing on First Nation reserves and on-reserve waste management infrastructure development. This funding will provide drinking water advisory task forces, planning, procurement and construction of more than 140 capital projects. Also, this funding will support education, planning, negotiation and construction of facilities to enable First Nations to enter into waste diversion agreements with nearby municipalities, as well as support capacity building and construction of transfer stations and engineered landfills on reserves for up to six remote First Nations.

You will see on slide 5 a sample of these water and wastewater projects across the country, which we have done just to give you an idea of what we intend to do with these monies going forward for other First Nation communities.

On slide 6, the largest item in these supplementary estimates is $241 million required to address immediate on- reserve housing needs so that First Nations have access to safe, affordable housing in support of healthier and sustainable communities. This funding provides for construction of 150 new housing units, renovating 1,400 housing units and servicing 340 lots on reserve. It will also provide funding to address infrastructure gaps in regard to cultural and recreational facilities on reserve.

On slide 7 you will see examples of housing projects in the North, in Pikangikum First Nation, those that are single dwellings in the Yukon, and also retrofits we've done in Manitoba.

On page 8, the third item, which totals $215 million, allows the department to address federal contaminated sites, which are the legacy of past environmental practices of custodians and may be found on federal lands or on lands leased for federal purposes. As noted by my colleagues, this funding is for phase 3 of a 3-phase, 15-year plan called the Federal Contaminated Sites Action Plan, as well as an additional investment to accelerate the assessment and remediation activities of federal contaminated sites across Canada.

The fourth item on page 9 is for $104 million with respect to investments in a range of complementary infrastructure such as roads and bridges, energy systems, broadband connectivity, physical infrastructure to mitigate the effects of natural disasters and fire protection services. It is anticipated that more than 100 projects will be supported with targeted efforts to areas of greatest need.

Slide 10 provides you with a sample of those projects where we have worked closely with First Nations across the country in those areas.

The fifth item of $96 million will provide safe and healthy education facilities for the growing population of school- aged children by addressing the immediate needs of schools in poor condition or requiring major additions and increase the capital asset life expectancy.

Page 12 shows you some examples of pictures across the country of what we have done with First Nations in terms of new schools or expansion of existing ones and retrofits.

Finally, the last few slides provide additional information relating to the key initiatives including objectives, outcomes and status so you know the latest with respect to the items in the blue book.

[Translation]

Mr. Chair, the supplementary estimates will support our shared economic interests and improve the socio-economic conditions of Indigenous peoples and their communities. This funding will help address the economic disparity many First Nations, Inuit and Metis have experienced, and advance a process of reconciliation so that we may together unlock the great potential of these communities.

[English]

I look forward to discussing any aspects of the supplementary estimates with you and including some of the images that we have provided to you on past projects and welcome your questions regarding my presentation.

The Chair: Thank you very much, gentlemen.

Colleagues, let's start off with Senator Eaton from Toronto.

Senator Eaton: Thank you very much, gentlemen.

I'm sure this is easily explicable. Employment and Social Development is requesting 76 million for affordable housing and social infrastructure projects for Aboriginal people in Budget 2016. Then I see under your presentation, Mr. Thoppil, the second largest item is 241 million required to address immediate on-reserve housing needs. Are they two, or are they working together? What is that? What is the difference?

Mr. Thoppil: I refer that to my colleague Daniel.

Daniel Leclair, Director General, Community Infrastructure Branch, Regional Operations, Aboriginal Affairs and Northern Development Canada: Thank you very much, senator, for the question. It's a very good question. As you can imagine, there are many departments that are involved in the housing —

[Translation]

Senator Eaton: Yes, we are aware of that.

Mr. Leclair: I will continue in French.

The first amount of funding we have received thus far, as set out in in Budget 2016, will be used to fund our projects with existing authorities. We have to find other ways of offering better housing to the First Nations in the Aboriginal communities. To that end, we will have to work in partnership with them.

Senator Eaton: We have been asking the same question for many years. In order to offer a better housing program to the First Nations, is it possible to inspect off-reserve housing?

[English]

Because up to now, the last year, when we came and talked about Aboriginal housing, we were told, if I remember correctly, that we could not go on reserve. We could not inspect the houses. How do we know that they are being built to code, that they are being built properly and that money is not being wasted?

Mr. Leclair: It's a very good question. Housing is an asset that belongs to the First Nations, and housing is individually owned or owned by the band council. For the money that we transfer, we ask that the houses get built to code, but like some of us in this room, if we decide, over the years that we own the house, to do some renovations, we sometimes may not do those renovations in accordance with the code, and, also, sometimes the regulations or the code changes.

Senator Eaton: I'm sorry; I'm slow. You're telling me that, originally, when the money is spent and the houses are built — because I think you have 115 new housing units — these houses will be built to the same kind of rigorous code that ours are built to but that, in subsequent years, if renovations are made, then that's out of our control?

Mr. Leclair: I'm saying that, for the money that the department is providing within the funding agreement, we request that the houses get built to the code, but some —

Senator Eaton: Are they inspected?

Mr. Leclair: If, for example, the community or the owner asks for a ministerial loan guarantee, CHMC, before they provide the loan, will request, from the band council that owns the house, that the house gets inspected and be built to the code. One side of the equation is that some of the houses are built by the band council or by individual owners, and they are not receiving funding from the department. For these houses, we have absolutely no control over them because they are individually owned.

What I'm trying to say is housing is not only interesting, it's a complex —

[Translation]

Senator Eaton: Yes, I understand that, but is that something new? Last year, witnesses from Canada Mortgage and Housing Corporation appeared before the committee. They stated that they were not authorized to go onto reserves to inspect housing.

Mr. Leclair: They have changed their procedure for people requesting a loan and whose house is built to code. In the end, the important thing is that their houses are built to code.

Senator Eaton: We agree with you, but the $241 million is not a loan. It is a gift.

Mr. Leclair: We are working closely with members of the Assembly of First Nations through the National First Nations Housing Liaison Committee to identify better ways of offering the program. We are considering working together for bulk purchasing, in other words, purchasing a number of factory-built homes on the market that are built to code. Housing manufacturers have to follow the code, whether they sell their products on or off reserve. We do not have sufficient funding, however, to solve the on-reserve housing problems. We would like to work with the Assembly of First Nations to focus on the communities that are in the greatest need.

Senator Eaton: Do you think the problem will be resolved once and for all? For a number of years, hundreds of millions of dollars have been spent on on-reserve housing. Will we finally be able to say that everyone has a house?

Mr. Leclair: I am naturally optimistic. Whether it is on or off reserve, if owners and tenants assume their "responsibilities'', their quality of life can be improved. That is why we keep working with all regional groups. Two weeks ago, at the meeting with the Assembly of First Nations in Toronto, the Quebec chief stated that people who don't pay for their housing will not receive funding. The chief of the Whitecap Dakota First Nation, Darcy Bear, gave a few examples: people who have little money can receive assistance for painting and other work. That helps develop their sense of attachment to their property. That is one possible solution.

Senator Eaton: It encourages people to look after their homes.

[English]

The Chair: Since we're talking about infrastructure, each group has some money for infrastructure, so we have a lot of horizontal players. I'm sorry to interrupt, but can you, maybe Mr. Tibbetts and then Mr. Séguin, each talk about what you're doing with infrastructure in relationship to the indigenous folks on reserve through that department so that we have everything on the table on infrastructure between the three horizontal groups and totally understand what's going on with infrastructure?

We talked of contaminated sites. I would like to alert our members that we received today — and I'm not sure if you've received a copy — an excellent report from the indigenous — it's a follow up, but it gives us all the answers to contaminated sites, the questions that we have. I'm not sure if you've received it. Do you all have it? You have a copy? Richard, do you have yours?

Senator Neufeld: I have one.

The Chair: Okay, Senator Eaton? Senator Marshall, you have yours, too?

Senator Marshall: No, I don't.

The Chair: We'll get that for you because it will give us a perspective. What we would like to try learn from you folks, following up from Senator Eaton as a supplementary, is the priorities with construction and contaminated sites. We talked about this for a while. We had CHMC in last week, and we had their top senior operations individual with us. He was super and gave us a lot of insight in terms of the question that Senator Eaton was asking about — responsibility, codes, et cetera.

Could we just work together to get the number of houses? We have the number from Mr. Thoppil. When we come down to how many units will be built, if we can break that down so that we have a total, we're trying to create an understanding of where this is going and how it's being prioritized.

Mr. Tibbetts: On the health front, I'm going to turn to Sony, here, in a moment. We've got infrastructure coming into the department in about four different ways. Not all of it is for indigenous or on-reserve programming. The main part is for that. In the supplementary estimates, it's the social infrastructure, which is mostly about clinics, nursing stations, hospital repairs and things like that for facilities on-reserve. I'll have Sony go into that in more detail.

On the contaminated site part, we're not building anything at Health Canada. We're getting about 10 million over four years for phase 3 of this. There's no contaminated site work done under phase 3 by Health Canada on reserve; it's already been done.

However, we do the inspection and risk assessment of the health assessments for all custodial departments, not just for Indigenous Affairs but for Public Works, et cetera, on the health impact of those and the risk assessment, and categorization and prioritization of contaminated sites. The money we are receiving for contaminated sites is that enabling support function that we do there.

The third area is Health Canada's labs and facilities. It's not on reserve. They are for our science business and regulatory business. I mentioned electrical, plumbing, ventilation — base building things — to fix that up.

The fourth area is water. Again, that money is not to build water-treatment processes, which is my colleague's responsibility. It's to maintain environmental health officers, et cetera, who do the inspection for contamination in the water, be it chemical or biological, or to help fund First Nations do that and provide test kits.

So there are four initiatives, two of which are on reserve; namely, the water and the facilities part for our nursing and primary care services.

Sony Perron, Senior Assistant Deputy Minister, First Nations and Inuit Health Branch, Health Canada: For the component that is on reserve or related to facilities owned by indigenous partners in the organization, Health Canada supports around 500 health facilities located on reserve. This includes nursing stations, where there's a full range of health care and clinical care services delivered by Health Canada, the province and sometimes also by the First Nation organization themselves as well as health centres that are more like public health — location for immunization, child care — these kind of services. We have 300 of them. We also support a number of detox treatment centres for addiction-related issues. There are 45 of them. Then we have a number of related buildings, including facilities for housing for nurses around these health centres, treatment centres or nursing stations.

Annually, in the last few years, we have spent around $30 million, roughly, in repair and renovation, allowing us to replace probably one facility every two years. The additional investment we got out of Budget 2016 will allow Health Canada over the next two years to undertake major repair or replacement of health facilities, such as nursing stations, health centres and treatment centres. Those are really important investments.

If you were to look at some of our risks that we reported to this table in the past, the health infrastructure was one of the risks. We thought that with the small budget we had, we were able to maintain what was in place but not really undertake major renovation and repair. So this is repairing important health facilities on reserve.

Those are owned by First Nations, so this is done through contribution agreements. There is a framework for that. We have long-term capital planning in each region based on the age and needed repair of each facility. This is known by the First Nations partner. When the resources were announced in the budget, we were able to quickly inform chiefs and councils across the country about the facilities for which we will be able to accelerate our long-term capital plan and undertake these projects.

There are 41 major capital projects that will be completed over the next two years in various regions of the country — most of them in rural and remote locations. You can understand some of the complexity of getting these projects undertaken, so that's why they are done over two to three years, normally.

We also have another envelope, which Jamie will talk about, to undertake repairs to facilities supporting the Aboriginal Head Start program. The Aboriginal Head Start program is one of what we call the upstream health programs that helps to support children of young ages to learn their culture and be proud of their culture. It's part of a public health approach.

We have a number of sites like that across the country — 300 of them. Most of them are in band-owned buildings, but they haven't received additional investment over the years to upgrade these facilities. This will allow an upgrade to a number of facilities across the country, again to put them back to standard but also to deal with the fact that there is a growing population and demand, also allowing these centres to accommodate more services over time.

These are the two major components that are directed to indigenous peoples, mostly on reserve.

The Chair: How many nations are there? 647?

Mr. Perron: 600 of them — about 634.

The Chair: About 634? I'm not trying to be a know-it-all, but we were told the facts recently.

If you are renovating or building 500 health centres, and there are 634 centres, does that mean that there is a need throughout the nations for new, updated or repaired facilities? You said you had 45 detox centres. Would there not be a need for 647 detox centres? Are there 640 or 634 detox centres? I just want to understand where we are with the state of repair and construction.

Mr. Perron: I would not be able to inform this committee in detail about the state of repair for all facilities. What I can tell you is that, in each region, we have a long-term capital plan that identified those facilities that need to be repaired. Some of them are 40 or 50 years old, so they need to be repaired. Some are not to the size to meet the demand of the population, so the service needs exceed the capacity of the building.

Some other buildings are required to be upgraded because there have been changes in the ways the service delivery is organized in these communities. There are also opportunities; for example, you may have heard that several provincial governments have started to expand their services on reserves, so they are coming with physicians and additional services. These facilities need to be able to accommodate that.

It's difficult to give a good sense. I can tell you these 40 projects are the ones that are critical — the facilities that need to be repaired. We have a list of others, so when it will be time to make cases for future infrastructure investments, this program will need some more. But this investment will allow us to address all the critical needs that we had across the country for nursing stations and treatment centres.

To your question about whether we need a treatment centre in each community, I would say "no.'' Treatment centres are highly needed infrastructure, but they are usually organized in an institutional fashion, usually outside the community, because people going into treatment are not necessarily doing that in their own community. They want to go out, and we need to organize professional services around that. We don't do it directly; it's done by third-party organizations that are usually First Nations organizations accredited to do that. There is a huge demand for treatment.

There is a component of the treatment that is called on-the-land treatment that doesn't require infrastructure, so we do fund both. But there is no infrastructure needed when we talk about on-the-land treatment. It is more community- based treatment that brings people back to their roots — back to the traditional way of life to try to rebuild.

There are different components, but when I was talking about the 44 or 45 treatment centres, those are the ones that are really treatment centres — long-duration, for a couple of weeks, going through the long processes. We haven't invested in those facilities for a long time in terms of reshaping the infrastructure. This is a nice opportunity.

After these two years, if there is more opportunity, we will have other projects to undertake, but at least this allows us to address things that we were not able to address for a number of years with the $30 million that we had aside to do these projects.

The Chair: And your partner, Mr. Thoppil, who is on the ground with $8.8 billion, is doing a lot of the heavy pulling. What is your assessment of what these folks have done to help you?

Mr. Thoppil: We work in close collaboration on the ground. There are some schools, for example, where Head Start is incorporated in those schools. That's just an example of collaboration on the ground. When we build new infrastructure or repair existing stuff, we work closely with our colleagues, whether it's ESDC or Health Canada, and with the First Nation to see whether there is complementarity with our actions whereby it works best for the committee.

When I go back to one of the images we have on the schools where we're doing an expansion, we are looking at those types of opportunities such as Head Start.

The Chair: Who measures success with what's taking place between the departments? Who measures if it's been done and done right? How does that work?

Mr. Leclair: Thank you, Mr. Chair. I could take the rest of your time to explain the process, but I don't think you have that time.

Regarding macro infrastructure on communities, there are two types of infrastructure. There's the commercial one, and in our program we don't invest in that — for example, a gas station or coffee shop or casino. This would be done by the First Nation or the owner.

We also have what we call the "community infrastructure.'' For INAC, we have 14 categories of assets that go for water, housing and schools. The other one would be the school, of course, the main one. We will have other infrastructure. You can compare with something off-reserve, a small municipality.

We also have assets that belong to our colleagues under the responsibility of Health Canada. We recently started to work together because we are responsible for the majority of the assets and we're trying to keep the life cycle of the asset. We do inspections every three years for the 14 categories of assets. On water, we do it annually to ensure that the water systems provide safe drinking water. When we have an inspector, they quite often come from the tribal council or from a First Nation organization. We also have an agreement with Health Canada. The inspector inspects the asset under the responsibility of Health Canada.

When we get the report of these inspections, it serves as the basis for the investment plan. For example, if the school roof is leaking, that goes in the inspection report and it provides a work order that the First Nation can submit to the region to say they need to change the roof. From there, it depends on the cost of the repair. If it's what we call a "minor repair'' — for us, a minor repair is about $1.5 million — it's done locally. If it's a major project that will require a new school, for example, that will go in the overall investment plan, the capital plan. Depending on the cost of the school, if it's below $10 million, my regional colleague, the regional director general, will have the authority. He will do the project with the First Nation. If it's above $10 million, because we consider that high risk, they have to come for the authorization or approval to our operations committee.

The Chair: Mr. Séguin, does your department have some implication in this, too?

Mr. Séguin: Yes, I do, a little bit. On the question of social infrastructure, there are many different programs that are part of the chapeau called "social infrastructure.'' We have three of those. I'll quickly go over part of our commitment there.

We're requesting some $57.5 million under the program. Those are specific programs that we manage under the Homelessness Partnering Strategy, and this includes preventing and reducing homelessness across the country. We have a funding mechanism, and we have 61 designated communities across the country, urban and rural areas. When we talk about Aboriginal in this case, these are off-reserve Aboriginals, so they're not on reserve. This is assisting homelessness issues for off-reserve Aboriginals, not on-reserve. That's one under social infrastructure.

Another one under the social infrastructure chapeau is $2 million for the Enabling Accessibility Fund. This is basically to improve physical accessibility and renovations to provide handicapped accessibility. There's no designation as to whether individuals are Aboriginal or not. It's just handicapped accessibility. It does not have an Aboriginal flavour to it one way or the other. It can, but it's not necessarily that.

The third one is $16.5 million for the First Nations and Inuit Child Care Initiative. Again, this is under the social infrastructure chapeau. The intent of that is to support or fund immediate repair, rehabilitation and equipment needs of existing on-reserve child care facilities. So this is to rehabilitate existing child care facilities on reserve. Our programs are designed for off reserve. This is one that is specifically on reserve.

The Chair: Is this a new one, Mr. Séguin?

Mr. Séguin: This is under the social infrastructure, yes. This is new for the budget.

The Chair: How far is $16.5 million going to take you?

Mr. Séguin: I think there are 400 facilities. As for the exact performance, I don't know if one of my colleagues may have that. We'll have more information.

The Chair: That's perfect.

Can you identify yourself for the record?

Damon Rourke, Director, Aboriginal Program Operations, Program Operations Branch, Employment and Social Development Canada: Just to be clear on what Mr. Séguin was talking about, the ASETS program, not to be mistaken with the assets Daniel was talking about, is our Aboriginal Skills and Employment Training Strategy. Through that, we have 84 agreements, of which there are a number of sub-agreements or points of service. For the First Nation organizations, they have sites on reserve. As was mentioned, there are 463 child care centres.

I should have explained that existing right now, to answer your question, senator, $55 million flows through these 84 ASETS organizations that then fund child care centres on First Nation reserves but also Inuit communities. With the $16 million, we've solicited information from the ASETS organizations on what we can do immediately in terms of health and safety concerns, renovations and upgrading. That's what that new money of $16 million would be used for.

The Chair: If you had to say of 100 per cent of the needs, what percentage of needs will you be able to accomplish?

Mr. Rourke: Of the approximately 460 sites, we have information from about 360 of them, of which tier 1 is those immediate needs. Tier 2 would be those other needs, a roof and things like that. Right now, pending ministerial approval in terms of what sites exactly, we could address roughly 120 sites with the $16 million that's been identified. We would obviously need to go back to the organizations to see how exactly they're going to do that within this fiscal year, because it is money for fiscal year 2016-17.

The Chair: Is it done on an average-need basis? Do you just split the money up amongst them, or do you do it on a prioritized basis?

Mr. Rourke: I think it was mentioned that we deliver our programs through Service Canada regions, and our biggest region is the western territories region, which has 46 ASETS agreements, and then there's the Ontario region, Quebec and Atlantic. The notional allocations would primarily go to the western territories region, only because they're the ones with the most agreements.

Senator Eaton: Are these new programs, and how can we follow it? We just seem to see money going out, and every year we all read about a lot of complaints. We all read, and you read the papers as much as we do. We never seem to get on top of it, whether it's the housing situation or the social infrastructure. Are these new child care centres a new thing or an old thing? Is this a new program?

Mr. Rourke: It's all existing child care centres, so we're not looking at new spaces or new child care centres. Of the 84 agreements we have and the $55 million we have currently that flows annually to these organizations, this would be a top-up to that to do immediate renovations and upgrading to those existing facilities.

Senator Marshall: This is not child care for First Nations, is it? Is this all across the country, or is it just First Nations?

Mr. Rourke: FNICCI is the acronym. It's the First Nation Inuit Child Care Initiative. It's been rolled in as part of providing a single window contribution agreement to Aboriginal organizations. It's been $55 million since 1999.

Senator Marshall: Funding for First Nations for different programs is not only in Indian Affairs and Northern Development; it's in health and it's in employment and social development. Last night, we had individuals in from CMHC, and there's funding there. I won't use the word "puppet master,'' but who is taking charge? Who is the person who sees everything?

You have some, you have some, you have some, CMHC, who was in last night, have some. I can't remember the other departments, but it's all over the place. It's everywhere.

The Chair: Mr. Thoppil, would you like to take a crack at that?

Mr. Thoppil: It's a question which comes up often. There are over 30 departments and agencies involved in some fashion with Aboriginal programming. There are frameworks that exist among the departmental community on strategic policy and consultation and engagement on various initiatives, as well as on a program level and infrastructure in order to ensure effective coordination of the delivery of the funds at the reserve level.

Senator Marshall: Why isn't all the funding vested in your department? Why is it scattered? It makes an outsider wonder if the government has control over the expenditures for First Nations. That is just an example, because we had the same issue with things like contaminated sites. Why is it so fragmented?

Mr. Thoppil: Number one, I would argue that's a machinery of government question. Number two, programs are aligned with the mandate of the department. This is where we have correlation between health stations on reserve that are consistent with the medical services provided through FNIHB, which is in health. As well the child care elements that ESDC is espousing is a core element of their Youth Employment Strategy and other elements of their strategy.

The Aboriginal engagement is a whole-of-government responsibility, and that's why you saw the reference in terms of the relationship with engagement with indigenous peoples in every single cabinet minister's mandate letter. It's not just one department's responsibility; it's a whole of government responsibility. It's everybody's responsibility.

Senator Marshall: To narrow it down, under Indian Affairs and Northern Development, I see funding for affordable housing, $241 million. CMHC was in yesterday, and they've also got investments in housing for First Nations. What's the difference between what you're providing and what CMHC is providing?

Mr. Thoppil: I will ask my colleague Daniel, who works side by side with CMHC, to respond to your question.

Mr. Leclair: Thank you, Paul and senator. That is a good question. CMHC, under their authority, the money they received in the budget is for repairs mainly. They probably have other new housing that I'm not aware of. I'm not specific about them. For us, there are repair some sections. I won't bother you with the sections.

Senator Marshall: Yours is all repair?

Mr. Leclair: No, it's mainly new construction and also some repair. It's under their respective authority. The money we received for two years with regard to housing was because the need is so high. We need money to improve the condition of some housing.

Senator Marshall: You receive money for new units and for renovations or repairs, but CMHC receives the same thing for First Nations.

Mr. Leclair: Again, I will have to refer to the existing specific authority of each department. With regard to housing, we were asked to work together, to go back to cabinet and work with the Assembly of First Nations and other First Nations to see how we can improve the management of housing. This is why the owner of the infrastructure is the First Nation. We learned that because just with my program, it's 14 categories of assets. The roles are different for each asset.

Now, with new money, there's money also for capacity. With that budget, we will help First Nations that need to build the capacity to understand the community plan. What is the plan the community needs? It's a holistic approach. If the community needs a health centre, now we work together and say how? But in one plan, the health centre, the social funding could be Health Canada. If it's something that's under the authority of CMHC, it will be CMHC's source of funding.

Senator Marshall: I can understand health is saying they have different health care facilities, et cetera. I can understand that that falls under health. Now we're talking about repairing housing units and building new units. Some money is over in CMHC and some money is in Indian Affairs and Northern Development. The question is: What criteria have to be met in order for the money to be in CMHC? What criteria have to be met to be in your department? More importantly, do the two agencies get along? Are they perfectly in sync? He got his 50 per cent and you got your 50 per cent and you work it out?

Mr. Leclair: To be more precise, I think we will have to get back to you.

The Chair: That's great.

Mr. Thoppil: We can do that. We work closely on the ministerial loan guarantees, which is the loan element on housing and is around $1.8 billion. That is a collaboration with CMHC, who does the risk assessment for CMHC loans. It's essentially our guarantee, but it's done based on the risk assessment and review based on CMHC. That's just another example of the close cooperation at an operational level on the housing file.

Mr. Leclair: As another specific example, two weeks ago in Toronto there was a discussion with all the national chiefs from AFN and the technical experts from the First Nations on housing and infrastructure. Colleagues from Health Canada and from CMHC were there for the three days. Yes, we work together. At the end, we aim for the best outcome, and the best outcome for infrastructure is a good asset for the user.

Senator Marshall: It would seem to me that the best outcome would be achieved if all the money was under one jurisdiction. Instead of split between CMHC and you, one or the other would do it.

Almost every department we look at has funding for the management and remediation of federal contaminated sites. Under Indian Affairs and Northern Development, would this be just contaminated sites on reserves?

Mr. Thoppil: No. We have two aspects to the contaminated sites at INAC. I will refer you to the response provided when we here last time.

There are remaining in our inventory over 2,000 sites; 1,876 of them are on reserve, but 156 of them are north of 60. There's an inverse relationship between the amount of sites and where they are and where the spending actually occurs, because the more problematic contaminated sites are actually north of 60, which is actually former mine sites. Giant and Fera mine come to mind. It's not about the number of sites but the complexity of the sites that drives the dollars on remediation and assessment.

The Chair: North of 60, that's parallel.

Mr. Thoppil: That's correct. I apologize.

The Chair: Don't apologize. This is why we're here.

Can I ask a favour? We have two eager supplementaries from Senator Pratte and Senator Eaton.

Senator Pratte: Yes, I'd like a supplementary to Senator Marshall. I'll do it in French.

[Translation]

Your answer, Mr. Leclair, has stopped me in my tracks, so I have lost all my English, which was not very good to begin with.

I am a journalist by training and I had made myself a note to ask for an explanation of the difference between the role of Indigenous Affairs and Northern Development Canada and that of CMHC, but I was afraid to ask because I thought the answer would be so obvious that I would look like a fool. I can see now that the answer is not obvious, and I cannot get over it. I feel for the First Nations who try to understand the difference.

I will give you another opportunity. It seems to me that your two organizations should play a specific role, for example, CMHC should focus on a specific type of project while your department would focus on another type. If that is not the case, that means that you do exactly the same thing until you have spent all the money you were allocated, and the same applies to CMHC.

Mr. Leclair: Thank you for the question and for the opportunity to clarify what I said.

Each program operates on different terms. I do not know the terms of my program off the top of my head. As I said, I have 14 categories of assets. I offered earlier to show you a table to clarify the roles of CMHC and Indigenous Affairs and Northern Development Canada.

To answer your question, our role relates more to social housing, while CMHC plays a role in market housing. You are right, it gets complicated for the First Nations to figure out where to draw the line between the two. When there is a line, there can of course be grey areas between the two.

Senator Pratte: I understand that "social housing'' is "subsidized housing'' or even housing that is given ±

Mr. Leclair: For some First Nations, "subsidized'' means that the federal government basically pays 100 per cent.

Senator Pratte: For its part, CMHC lends money to people who buy their houses.

Mr. Leclair: That's right. Mr. Thoppil was saying that, for example, for loans with a departmental guarantee, CMHC gives a First Nation a loan and we, at Indigenous and Northern Development Canada, guarantee the loan. So if there is a default, our department covers it while, in this case, our colleagues at CMHC assume the risk.

I agree that it is not crystal clear. There can be a grey area sometimes, and to help people understand, we developed a chart with our colleagues at CMHC to clarify where the line is.

Let me reassure you. In each region, there is a housing committee that includes members of the First Nations and our colleagues from CMHC, as well as members of my team at the regional level. Those responsible for housing within the First Nations understand the difference.

Senator Pratte: When you say there is a chart, you mean there is a document we could look out that spells out the criteria and that a journalist like me could understand.

Mr. Leclair: I could show you the terms in detail, which are a bit complicated. Since you are a former journalist, I could show you a slide with a balloon explaining the role of our department, of CMHC, and where they have to work together in the middle.

We must not lose sight of the fact that the housing belongs to the First Nations, to the band councils. The owners have to play a role to ensure that, at the end of the day, the housing stock is managed effectively.

Senator Pratte: To conclude, when big chunks of new funding arrive — because you receive very large amounts, as does CMHC — the challenge, the grey area in between, is even greater.

Mr. Leclair: I would like to reassure you in this regard as well. That is why, from the outset, the funding allocated for housing is spread out over two years on the condition of possible review. That review is done in partnership with the members of the First Nations and with CMHC.

The three partners work together for the coming years, and any additional funding we might receive could come with a review or a new management framework. The funding allocated in the first two years is disbursed under the terms of existing programs.

Senator Pratte: Thank you. So the documents ±

[English]

The Chair: It would be great if you can provide that to us. You've been fantastic with providing us with information, as have all of the three groups here tonight.

Senator Eaton: When you give the money, or ESD gives the money, or CMHC gives the money, and you build 500 or 200 new houses, do you say, "All right, these houses should be good for 20 years, or these houses have a lifetime of 10 years, or these houses have a lifetime of 30 years?'' Is there something like that?

[Translation]

Mr. Leclair: I don't think we have that type of criteria for housing. To give you an example, with respect to schools, our goal is to build schools that last as long as a school or some other asset off reserve. As I said earlier, that is why we have a three-year maintenance program to determine what maintenance is needed and what the deficiencies are. Moreover, we pay for the maintenance and the construction of a school, for example ±

[English]

Senator Eaton: Yes, but that's up to code, right? They're inspected.

[Translation]

Mr. Leclair: Yes. There is another thing that I have not mentioned yet. For the majority of assets, aside from housing, the First Nations deal with engineering firms. Those firms have an architect or an engineer who signs off. They have to comply with the standards of their provincial association. For schools, the owner certainly ±

[English]

Senator Eaton: No, but for houses. For the last five years I've been sitting on this committee, all this money goes out every year for Aboriginal housing, yet the need never seems to end. What I'm saying to you is when these houses are built on reserve, is there a lifetime guarantee of 20 or 30 years?

Mr. Leclair: If you have the pleasure of going to Quebec City, the houses there will probably be as long as the house on reserve. Of course, if you have a house up North, as I said previously, some of the houses are built with the money that our department or CMHC provides. Some other houses are built by an individual who can decide to build the house the way they want, and they may decide or not to build it to code.

Senator Eaton: We give them the money to build it?

Mr. Leclair: Not necessarily. In the past, with the money we were allocating, it was not sufficient for all the houses' needs. With the new money, it's basically $416 million. It will not be sufficient to improve all this.

Senator Eaton: No, but with the $416 million, you're building it?

[Translation]

Mr. Leclair: The asset belongs to the First Nation; we deal with tribal councils or directly with the band council. So we transfer the money to the band council which builds ±

[English]

Senator Eaton: So they don't have to build it to code?

[Translation]

Mr. Leclair: In the funding agreement, for the money we provide, we ask them to build to code.

[English]

Senator Eaton: So they can't come back five years from now and say, "You know what? All that money you gave us five years ago, those houses have fallen down and we need new houses.''

Mr. Thoppil: My colleague was saying it depends upon the reserve and whether the band council uses its own source of funds to build those homes for individuals or whether it's federal government money. If it's band council own- source revenues in order to fund individual homes, then whether they apply codes or not, that's up to them. What you get sometimes in the media is a lot of homes in disrepair based on own-source revenue homes.

As Daniel said, when we provide that funding, it is based on respecting code. That's a basic requirement under our funding agreement with them.

Senator Eaton: So now you can go on? If they're building housing with your money, you can go on reserve and inspect them so they are properly built?

Mr. Leclair: That's a good question. The only ones we don't inspect are the houses where the owner is the individual.

To continue from where I think you were going, it is the same thing off reserve. If somebody builds a house and decides they don't maintain it —

Senator Eaton: But if they're using your money, if they are using federal taxpayers' money, can you inspect it or not?

Mr. Leclair: No. And we have no control to determine if they decide not to maintain it.

Senator Eaton: If you give me a million dollars to build a house, you have no right to inspect it? If you give me the money?

Mr. Leclair: No, because the money goes into the overall transfer of the money — in the overall budget — to the chief and council, and the chief and council determine what their priorities are.

The Chair: It depends on the credibility of the chief and council. This is the issue we've been talking about together. It's a very sensitive issue, obviously, because it goes into jurisdiction.

To move forward, if there's going to be real change with you folks negotiating relationships with the various First Nations groups — and we have over 634 First Nations — there's going to be a percentage that will agree, there will be a percentage that will say "maybe'' and there will be a percentage that says "go take a hike.''

Senator Eaton: Then we are not protecting the First Nations person who's got a house that's not quite to code, and we're not protecting taxpayers' money.

The Chair: The question is getting closer to an objective that is going to be for the common good of everyone.

Mr. Thoppil: What we've been talking about is there is a real diversity of housing stock across the communities. It depends upon governance, management capacity and, as Daniel explained, the imposition of a rental housing regime. These are all factors that come into play. Geography also factors in, because the farther north, the tougher the climatic conditions and the wear and tear on the longevity of that house. So there are a number of factors going forward.

What we tried to put in here, notwithstanding the media that tends to talk about the state of disrepair, is that there are a number of success factors that we've tried to give you through the presentation today that demonstrate in the North where we're working in collaboration with First Nations on the design to take into account those climate factors in order to get longer life.

Also, we look at designs that work for the diversity of the demographic in the communities, such as elders or young people, going forward.

Senator Eaton: Those are all good things. Thank you, Mr. Chair.

The Chair: In fairness to Mr. Thoppil, there have been great advances. The issue is, as we go forward, what are going to be the two or three issues that are floating around that you've got to be able to solve to get to where you want to go. Is that possibly one of the questions, from a strategy perspective?

Mr. Leclair: Yes. Again, First Nations leaders, First Nations housing managers, our team within the department and colleagues from CHMC — the first thing they will say is to determine a sense of ownership. We see that, and it's not particular to on reserve; it's the same thing in off reserve. If you buy a house versus if you rent, or the kids now go new couch crashing somewhere, the point is that if you don't own it, if you don't invest it, you have no interest in maintaining it.

I'm positive by nature. With the work we are doing and First Nations members and leaders, we are saying, "Okay, the housing needs are so high. I think we can probably all agree that the past did not work, so we need to work together.'' I think this is the question from you, senator. Money is only one part of the equation. There's ownership, leadership and after that, there's the regulations.

The Chair: And the cultural issue.

Do you have questions, Senator Neufeld?.

Senator Neufeld: I've been listening, and the questions I had have been ably asked.

Senator Pratte: I have one for ESDC.

The Chair: Let's make sure we involve all the groups.

[Translation]

Senator Pratte: As to summer jobs programs, I have absolutely nothing against these programs for Canada and it was announced a little while ago that the funding had been increased substantially, to $339 million over three years, which means an additional 35,000 summer jobs for the next three years. Have additional criteria been added to the program as to the type of jobs and so forth? Have changes been made or is it exactly the same program? That is a lot of money going to summer jobs. I understand it can be very helpful, but that is a lot of money.

Mr. Séguin: That's a very good question, I will ask ±

Senator Pratte: I am suspicious when someone says it is a good question.

Mr. Séguin: I say that because I do not have an answer right now. I will ask a colleague. In principle, it is the same vehicle, but I will ask Mr. Atherton so he can tell you more about how the funding was developed.

[English]

John Atherton, Director General, Employment Programs and Partnerships, Employment and Social Development Canada: One of the programs I am happily responsible for is the Youth Employment Strategy, which has Canada Summer Jobs, which is part of the summer work experience component of the strategy. There is also Skills Link and Career Focus. Skills Link is for youth at risk and Career Focus is for graduates.

Senator Pratte: Mr. Atherton, did you get my excellent question?

Mr. Atherton: I did indeed. The question is: Is there a criterion? Yes. Actually, there are several criteria. Canada Summer Jobs was launched this year on December 15, I believe, in the house, with all the members of Parliament. They play a really important role in the program. The budget is actually allocated out by constituency. At that time, the first criterion is local priorities. We get members of Parliament to identify the local priorities for us in the program, and those are posted in advance of the actual application process. That is part of the assessment that's done on every one of the applications.

We receive, on average, about three applications for $3 for every one that we have, so it's a highly competitive process.

There are many different criteria: You can imagine criteria that would support Canada's official minority communities. This year, the minister had four national priorities that had special criteria supporting refugees, which was a key one. Aboriginal organizations was another one, and some for small business was a third one.

So we have national priorities, local priorities and then, of course, we have the quality of the job itself. What kind of on-the-job experience does somebody get? Is the employer making a commitment to top up the wage? Because in our program, we will pay up to the minimum wage but no more in the not-for-profit sector, and we will pay half of the minimum wage in the private and public sectors. So another criterion is whether the employers are willing to top up that wage.

Yes, indeed there are criteria, and it's a competitive process. At the end of the day, members of Parliament work closely in helping make sure that the lists of funded applications truly do represent the needs of the local area, because they validate and sign off those lists with us.

Happily, I'm able to tell you that when the government asked for the additional funding, it said it would double the number of jobs offered, and it looks very much like we've done that, at least.

Senator Pratte: The local criteria are defined by the MPs or —

Mr. Atherton: The members of Parliament, and our Service Canada folks can be helpful, but we find that the members of Parliament have a very special connection with their constituencies. They know if there's a local festival or something that's really important in their community. They have constituency offices, of course, that help them do that. It's a well-run machine.

Senator Pratte: I'm sure, and I'm sure it's very popular and MPs like it. I'm just wondering if whether, after the three years, we should not look at it. Is it written in the budget to look at it? It is?

Senator Marshall: There's a section in the budget that says "pursue evidence-based decision-making.'' I think that's what you're alluding to.

Senator Pratte: Exactly. I'm sure it's very popular and is good for youngsters, but I think it would be a good idea after three years to see whether the program did have an impact and whether young people did benefit from it as much as we think they did.

Mr. Atherton: That's actually a really good point. In fact, the evidence from the program — the publicly available evaluations — shows that it helps kids save for their educations and gives them valuable work experience, and so we have very strong results.

Interestingly, something we implemented this year out of the evaluation, which indicated that we had an opportunity because we come in a contact with so many young people through this program across Canada, was to share with them more labour market information so they could make career learning decisions earlier in their life. Of course, Canada Summer Jobs participants, as a requirement of the program, need to be returning to school.

It's important during this period, especially if you're returning to school or you're in high school, that you're making these choices about what subjects to take. Our evaluation found that we were missing an opportunity in connecting with the young people. This was the first year in which we shared with our participants, through the employers, a career choice tool that we had developed in the department to help young people understand the choices they make at school and the demand out there for jobs. We are an evidence-based organization, and this program comes under fairly tight scrutiny and has strong evaluation results.

Senator Marshall: All those programs are evaluated, are they? You said summer jobs was evaluated and you get responses from students, not just the MPs or the organizations being funded. It includes the opinions of students?

Mr. Atherton: Yes.

Senator Marshall: What about the Skills and Partnership Fund? Are evaluations done on that program too?

Mr. Atherton: We can get back to you on the latest evaluation results. There's a fairly recent initiative that programs are evaluated on a five year cycle, so it might not be surprising to learn that an evaluation had not yet taken place.

Senator Marshall: I was curious. It's in the government's budget book, and I keep hearing through the media, too, that it's now going to evidence-based or results-based decision making. You're saying evaluations are every five years, so that hasn't changed, has it?

Mr. Séguin: The government is actually reviewing its evaluation policy to bring it more up to date and to provide more up-to-date information, as opposed to five years. They're looking at how to get results and performances out more quickly.

Senator Marshall: Is the Canada Job Grant the one where the money gets transferred to the provinces?

Mr. Atherton: That's one of the transfer programs I'm responsible for.

Senator Marshall: So that's $50 million in the supplementary estimates. It's more than that, isn't it? Because $50 million is not much if you look at it all across Canada.

Mr. Atherton: That's true. There's a commitment to provide up to $200 million more for those arrangements but, because of the lateness of the funding and the provision this year, it's $50 million in the first year. So on a base of $500 million, a $200 million increase will actually turn out to be quite substantial for the Canada Job Fund itself, over time.

Senator Marshall: Do you send auditors out to the provinces to look at that money? Something rings a bell. Have you ever done so?

Mr. Atherton: I actually receive audited statements. It's different, so when we do contribution agreements with organizations, like the YMCA or others, of course we have monitoring procedures. We actually go out as a department and we monitor those financial transactions and get results.

When we're dealing with another government in a federal state where you have two sovereign governments, what you're finding is that they have very strong evaluation and audit procedures. When I get a signature that their auditor has reviewed it, and it's in line with our agreement, then that's what it takes for us to send the cheque.

Senator Marshall: Thank you.

I had a question for health. I don't think you're going to be able to answer, but I still have to ask it.

What is the status of the Health Accord? We've been hearing about it a lot in the news lately, especially with regard to New Brunswick looking for increased funding because of their demographics. They have more people who are in the older age category. That's under finance, isn't it?

Mr. Tibbetts: The annual payments to the Canadian Health Transfer are done by the Department of Finance, yes, but the negotiation of the renewal of the Health Accord that's underway is being led by the Minister of Health, with other officials. It is a federal-provincial table that is underway with many things coming together. There have yet to be any decisions or recommendation coming out of that process. We expect something, hopefully, for Budget 2017, and the work over the next several months will go through that, like the home care programs that were announced in the mandate. As well, any kind of demographic issues will be subject to those negotiations.

Senator Marshall: I was wondering if we were going to see something in any of the supplementaries this year.

Mr. Tibbetts: Not likely, unless something happens sooner. There's nothing in this budget because of the negotiations, so you'll likely see something in the next fiscal year.

Senator Marshall: It's just the escalator clause now, is it?

Mr. Tibbetts: Correct.

Senator Marshall: You are thinking it will be next year and nothing for this year.

I'm thinking of the bigger picture of the $24.4 billion deficit, and thinking what's not in the budget yet and what could be added on.

Mr. Tibbetts: The negotiations are going very well, frankly, but I really have nothing to report at this point other than what you read in the paper.

May I provide a clarification? There was a question earlier on the division on why there are 30 departments involved in Aboriginal issues.

Indigenous and Northern Affairs is definitely the largest player, and significantly larger than anyone else. We are the second largest, and 70 per cent of Health Canada's $4 billion is for First Nations health care, but we're smaller than Indigenous and Northern Affairs and then it goes down from there.

You, I and others at this table are accountants. We understand very well the concept of separation of duties, and in a large, complex environment you need separation of duties.

We perform the health functions, and they perform things like water treatment facilities, but we do the no boil advisories. Separating those duties is actually essential.

Senator Marshall: I can see that. You're health, and they're social or daycare. I think the part that confused me was the housing.

Mr. Tibbetts: One super agency would get so big and complex. It might work, but the reason for it is to keep accountability flowing from legislation.

Senator Marshall: I can see the logic in that.

The other part is going back to the government's results-based decision making. I'm trying to think ahead. I understand health, but what about the housing? How are they going to look at and evaluate these programs when they are in different places? I guess we'll find out. On the health one, I'm fine. I understand the schools are with you. Daycares are with employment. I understand that. It's the housing.

Mr. Tibbetts: I wanted to make sure we didn't leave the question of why one department isn't taking care of all of it.

Senator Marshall: You're the specialist in health, and that's why you got the health.

Mr. Tibbetts: Correct.

Senator Neufeld: I have a couple of questions.

For employment and social development, there was one piece of funding here for $4 million over two years for enabling accessibility fund programs that will increase the support of over 80 additional construction renovation projects.

I don't know how far $2 million a year goes. You can say 80, but what does that mean? Is it 80 single residences or 80 apartment buildings? What does it mean? How is that money actually spent? You singled it out. Do you go out on a special contract for every one of those upgrades? Who decides you need the upgrade and where you need it? Is there more money spent in administration than there is in actual fixing of steps or whatever you're doing? That's the question.

Mr. Séguin: Perhaps I can provide that. It's under our responsibility. The process is that there's a call for proposals. These are individual projects to provide the construction of ramps, for example, to allow accessibility to community centres, things like that. So there's a call for proposals. They come forward. We're estimating that, with the 2 million, we can generate some 80 additional projects. It's 80. It's not huge, but it is more than we currently have.

Senator Neufeld: I get all of that. With $2 million, you make the call across Canada. How do you that in hundreds and hundreds of communities and rural areas? How do you make that call and say, "We have this kind of work to do?'' Then there's a bunch of bids that come in. Someone must adjudicate those. Someone must decide and recommend further up the line. How much of that 2 million is spent in the administration of getting $2 million a year on the ground?

Mr. Séguin: It's a good question; thank you. The 2 million is for the actual projects. It's not for the administration.

Senator Neufeld: What would the administration of spending that $2 million be?

Mr. Séguin: Just a second here, and I'll get that for you. How much is that administration, Mr. Won? There is just existing. There's no additional administration for that $2 million. We're using existing administration.

Senator Neufeld: So you have enough people walking around that they can actually figure all of this stuff out?

Mr. Séguin: It's Service Canada. We use that as our vehicle. They are across the country. We have centres and staff across the country. They administer the proposal process. They evaluate them. As to the details, I'm not familiar with how that's actually done.

Senator Neufeld: You have experienced people in every one of those Service Canada places that can actually go out and adjudicate these small little jobs, is what you're saying.

Mr. Séguin: Yes.

Senator Neufeld: I have another question, and it's for Health Canada. Health Canada is seeking a one-year renewal of 610,000 to maintain critical food safety activities, which are part of the action plan to modernize food safety inspection in Canada. I think we're all quite aware of some of the things that have taken place with food safety, and $600,000 doesn't sound like a lot of money to me. What are you doing with 600,000 to actually bolster the food inspection that you're responsible for?

Mr. Tibbetts: This is a one-year renewal of existing funding that came through prior increases that were made to respond to some of those issues that you're mentioning. The 600,000 is to fund the 4.5 people that we have that basically do the health risk assessments. Again, that's separation of duties between us and CFIA, the Canadian Food Inspection Agency, which does the inspections and whatnot. They provide specialized advice on areas around microbiology and toxicology within those health risk assessments and provide technical expertise on specialized chemistry and things like that, and that is sort of part of the assessment.

The response and the inspection part is part of CFIA. There is money in the budget for CFIA, for the larger slice. It's just our small piece of that.

Senator Neufeld: Do you have to apply for that every year to maintain those 4.5 employees?

Mr. Tibbetts: It is a program that is subject to further review by the government on its long-term sustainability. In the Main Estimate, every few years, you have a list of sunsetters in each department. Our climate change money in the current supplementary estimates of 25 million also sunsetted at the end of last fiscal year, so we had a reduction in mains. This is renewing it for a year while the government has a chance to assess that program as well. It could increase. It could decrease. It could adjust to new priorities. As we go forward, we'll see how long-term that renewal might be.

In this case, it seems to be a fairly steady requirement, unlike the federal contaminated sites one where we're seeing a gradual decline in our 2.5 million a year, roughly, for the next four years that we need for that. It used to be 5 million in the early days of the program, but now that remediation of sites, not the assessment of them, is really the issue, our level of requirement on that health inspection is a lot lower.

Senator Neufeld: This one could be going in the same direction?

Mr. Tibbetts: It seems to be steady, to me. It has been for a while. It's small. It will likely continue into the future as the government determines that bigger question about the level of inspection, et cetera, that's required.

Senator Neufeld: I have one question for Indigenous Affairs. It's about the Taku River cleanup and the Small House Project. Can you just explain a little bit about what you mean by Small House Project? I know where the band is; I know the country. Tell me a little bit.

Mr. Thoppil: This was a proposal that actually came from them. To deal with a response from the community, primarily elders, they wanted to have a home just for them, outside of a family dwelling. Usually elders are with the larger family, but there was a request that came in to try it out for single members within the community, so it encompasses elders or individuals, starters going forward.

What was interesting about this project was that they had young people who were apprentices who we helped to train to build those homes, and some of them are actually occupying them. But, now, as we continue with the next phase, those same people who learned the apprenticing in terms of building those homes will now actually take it on fully. So a number of objectives were accomplished with this proposal that came from the First Nation itself.

Senator Neufeld: They are pretty progressive; I know the band quite well.

Mr. Thoppil: Yes, they are. It was also adjusted for the Northern climate. In that one, there was also a bit of a vestibule in the front in order to provide that barrier that's lacking in a number of existing Northern homes related to the Arctic cold getting in.

Senator Neufeld: How many have been built, and how many are planned to be built? I gather that some were built maybe last fiscal year?

Mr. Thoppil: This is new, so the start date was 2014. It just finished last year. It was an experiment, an innovation, and it was three homes. But now that we've got those young people trained through that, we can contemplate doing more.

Senator Neufeld: What would it cost for those three homes?

Mr. Thoppil: Total cost, including the training of the 15 students and the three homes, was 550,000. That included in kind costs as well.

Senator Neufeld: That was the training of the students.

Mr. Thoppil: And the building of the three homes.

Senator Neufeld: Do you know the training cost?

Mr. Thoppil: I don't have that, senator, but I could come back to you with it.

Senator Neufeld: No, that's not a big deal.

The Chair: We have 15 minutes left. I'd like to ask one more question of Mr. Séguin, and then I'd like to ask each of the leaders of the departments if you could give us your top two successes in the last period of time that you've been overseeing your department and your top two challenges.

Mr. Séguin, with the reduction and the change going to the new Canada Child Benefit, you are going to reduce your expenses by 5.7 billion. What's the cost of the new Canada Child Benefit? What's that going to cost each year, and what will that do to the deficit?

Mr. Séguin: It's a very good question. I keep saying that.

Senator Neufeld: Larry's starting to feel pretty good about it.

Mr. Séguin: You don't see the amount for the new Child Care Benefit in the supplementary estimates because it's already in the Main Estimates. That's why there's a net taken out. The Child Care Benefit is already in place. For 2016- 17, it's estimated at $7.7 billion. It's $7.697 billion, to be precise, but $7.7 billion is the estimate for 2016-17.

The Chair: Does that mean, in simple arithmetic, that if you're reclaiming or reducing by $5.7 billion and it's costing you $7.7 billion, there's an incremental cost of $2 billion? Is that what we're saying?

Mr. Séguin: I'd have to get back to you on how that would work out to make sure that I have the right numbers because the amount is a net-out figure. I'll get back to you on that exact calculation.

The Chair: One of the things I hope you folks understand is that we really appreciate the honesty and openness that you're communicating with us. When we ask all these questions, we're trying to understand not only the operational issues so we can be better educated and see the interaction but also whether these expenditures are going to create more jobs and help our economy or are they going to be expenditures that increase the size of departments? It's important to understand that if the government is saying we have a policy that's going to be an economic policy to drive expansion and growth, et cetera, we just want to understand what's actually happening in your departments and what are the implications. Are the implications just adding FTEs and costs to your department, or are they actually doing something to stimulate the economic growth of this country? It affects all of us. No matter what your stripe is, most people will always admit that you can't spend more than you earn, and it's good to go into deficit financing to do different things as long as they deliver the results. Is that a fair statement?

What we're seeing from you folks as we move on is there's more about developing results and feedback. I understand the plans and priorities, because we're following them much more closely than we did historically. At the same time, however, we have to make sure that the actual results are taking place so that there is a real value for money.

As we look at indigenous affairs, as an example, this is a sensitive issue of jurisdiction regarding who controls the money and the whole housing issue. On the housing issue, it appears one of the recommendations we may make is there needs to be a real move not only for accountability and transparency, but there has to be a clarification of relationships so that the relationships evolve and the determination of ownership will take place in most of the 634 reserves. If you can give us the breakout of ownership versus non-ownership, it would help us to understand where this is headed. If one of the issues is going to be ownership versus non-ownership, this affects the value of money being given to these projects and the longevity of the projects themselves. It's great to say we're pumping in X million or billion dollars in terms of fixing things, but if you're fixing garbage, you're going to have more garbage. I think you've been clear on that. We're not trying to put you in a position where you're going to expose yourselves. We want to get facts to say this is going to be helpful to Canada.

Are you ready to talk about your two biggest successes and your two biggest challenges? That could be helpful to our committee to see where you are moving to. Who is up?

Mr. Séguin: I can start with that.

To put into context your query about whether the programs are going to garner results or are we just hiring public servants, et cetera, if you look at our supplementary estimates, out of almost $293 million in programs, only about $12 million is in operating for that. It's a small piece of the Canada Child Care Program, the $7.7 billion. The administration on that is incidental. It's a program that's managed through CRA. The operational costs are extremely low, so the performances are quite high on these.

From my perspective, the success and the challenges would be the same, and I'll explain. In responding to the new government in the last fiscal year and this fiscal year, with new programming, much of which is in the supplementary estimates today but there will be more in other supplementary estimates, you'll see a huge mandate of reform and change. In our own department, Employment and Social Development, we've had major changes to the EI policy — that is, investments in EI service to Canadians. Responding to that major transition as a public servant was definitely a challenge, but many people can be proud to deliver on those major changes. The intent, obviously, is to respond and to set up the criteria so that we have accountability, performance measures and proper responsibility for the delivery. Putting all that together are the big successes and definitely the challenges.

The Chair: From our perspective, we want to make sure that if there's a $2 million hole that may be created by implementing a new program, it's going to be important to see that there's a tremendous benefit to Canadians for the new program. Over a four-year period, you're talking $8 billion of additional debt. We're just wondering: Is that part of the government's plan as part of the debt? It will be interesting to identify that.

Mr. Séguin: Yes. I'll provide you that. I just want to make sure I have the accounting right, because there are ins and outs and that particular program is tricky.

Mr. Tibbetts: To give the context as well for Health Canada, of about $165 million that's in the supplementary estimates, there are only about 21 new FTEs in it. Most of those are temporary to oversee these large infrastructure projects and to make sure those results are achieved. There are 8 FTEs for the federal infrastructure sites on our labs to make sure those go well and to oversee my colleagues leading in First Nations' health and the water areas. About 240 other FTEs, though, are funded through the sunsetting programs that I mentioned earlier. It's not new; it's just maintaining the existing levels of the department. Very little is for incremental-type overhead, so to speak. Of the 165, the vast majority is going directly to these initiatives.

Many of the jobs are local; they're not in Ottawa. They're out doing work in communities, for example. Our labs are not just here at NCR; they're in Longueil, Scarborough and in other parts of the country. They are not necessarily permanent jobs; they are economic influx jobs that will go out to contractors through First Nation contributions or directly through our own contracting mechanisms to deliver these programs.

Will it create economic growth? I'm not an economist. I'm an accountant, so I'll make sure it's accounted for well. I believe the evaluation measures are there to demonstrate that.

On our two successes, I was here, as I said, in March. I'll start with successes. The First Nations Health Authority in British Columbia that we created is a massive example of partnership and federal-provincial First Nation leadership. It has been successful to date and is showing enormous signs of direction to move in the future. It has several more years of agreements and billions of dollars to watch over there.

The jobs and economic growth part was another kind of success. As for getting this infrastructure funding, which is a 300 per cent increase, when I was here last time I mentioned that infrastructure in First Nation communities was one of our number one risks on our corporate risk profile at Health Canada. This funding that is to go to the 40 projects we spoke about alleviates that in a major way. That, we assume, will be a success over the next couple of years.

The Chair: Will you be able to get the health professionals you need to go to some of these areas?

Mr. Tibbetts: This becomes one of the two challenges.

The Chair: I got excited because I saw that you were thinking.

Mr. Perron: You're right, and we probably flagged to the committee before that recruitment and retention of nurses and health professionals is a challenge. These are very challenging and demanding jobs. We have been able to achieve some success reducing our vacancy rate in the last year, training and attracting more nurses, but investing in infrastructure, security and residences for nurses in the community is basic.

When I talked with nurses — we had discussions with them yesterday and again today — they're coming with the basics they need to support them, and infrastructure is critical. Jamie mentioned before that this is one of our risks. This is an element for us to improve quality of service and attract more health workers, but not only nurses working for Health Canada but also working for the bands themselves, because our long-term goal is to support and empower First Nation control over their own health services.

It's difficult, and frankly, if I were the chief of a community, there would be temptation to take over these programs. With not really good infrastructure, I would not take on this responsibility because there's too much risk built in there.

Building a solid infrastructure is, in a way, also to enable better First Nation control over the health services. This is something we have done in British Columbia to get to the First Nation Health Authority. In the years before, we had invested a lot to get the state of the infrastructure in a better place so it would not be a liability to start with.

This year, with the funding we are getting into the infrastructure fund, B.C. First Nations are receiving their share of that. It is not because they are running their business on their own going forward, but they are isolated from additional programming and support from the federal government, so we are trying to maintain a solid partnership with them because we think they will be very successful.

Already in my job I see there are things happening in British Columbia that I've seen nowhere else in Canada because the province and the First Nations control their programs. They can do things that even from a public health perspective we need to do. It's really difficult to do because there's a legacy of relationship with the federal government or with government in general. When it's a First Nation institution, the trust is there for them to approach health and public health in a very different way.

Hopefully, you see the passion in me when I talk about this, because I feel there is hope in the future. I hope we will have similar things, and maybe different from B.C. It has to be done in the way the First Nation wants on their own in each province and territory or treaty area.

But there is a clear indicator. This committee is concerned about success and results. I think when you see First Nation control over their health programs, when you see better capacity and accreditation of services, then you get the work results and the partners that can work to organize the service differently than what we would have done from a government perspective.

My goal is to walk myself out of a job. It will not happen in the next few weeks unless something really bad happens. It's a long journey, but all these pieces that get better under control of First Nations make me hopeful that one day we will have a better system running in a First Nation community that is integrated but is fully under their control and culturally safe as well.

You have all heard the media and the sad stories we see across the country. We need to pay attention to them and we are, but there is also great success across this country that we don't talk a lot about, and we need to promote that. Those have characteristics in common: capacity, First Nation control over their programs, and good partnership with regional health authorities and provincial systems. These are elements that make them successful and provide better health outcomes.

Sorry, I had to do my pitch.

Mr. Thoppil: To respond to your first question about adding more to the bureaucracy, we are a Gs and Cs department. If you look at our vote structure, out of 8 or $9 billion, $1 billion of it is essentially vote 1 for operating, and half of that is actually for residential schools, the operations and the payments thereof. You can see the majority of our money goes out; it doesn't stay with us. It all goes out to the 634 communities across the country.

In terms of your second question about whether we are adding to stimulus, I would refer you to page 7 or 8 of the Parliamentary Budget Officer's analysis of Supplementary Estimates (A), whereby they found INAC to have a very good track record of getting the money out in terms of creating the stimulus that is desired from the PBO's perspective.

In terms of our successes, I think this is a very exciting time in the state of the nation in terms of the Canada- Indigenous relationship. We spend a lot of time in terms of advocacy and in terms of lifting the 2 per cent cap, and the government has acknowledged that. Therefore, you see now a significant investment, in part based on the proof that we have the evidence-based information we are bringing to give. Now we have a budget that has given that a percentage that is actually around 20 per cent in terms of by 2020-21.

I think that the spirit of reconciliation is also creating a positive momentum in terms of trying to deal with the issues of the past but also in the spirit of moving forward. I think that will be very important in terms of providing that underpinning that my colleague Sony was referencing in terms of eventually getting to sustainability in First Nations in terms of control.

The challenge is essentially what the minister has imposed upon her bureaucracy, which is: You've got the money that you asked for in terms of dealing with closing the socio-economic gaps. But she says she wants results. So now she's putting pressure on us to work together with First Nations on what those indicators are because she sees that as a mutual bargain between the federal government and First Nations so that they have to get by and on those indicators and working together to get there.

I think that the reconciliation provides that very positive platform, combined with the commitment on the investment to eventually get to the ultimate objective, which is to get to the elimination of the socio-economic gaps between indigenous and non-indigenous peoples in this country, and also dealing with self-determination as well.

The Chair: We really appreciate the feedback you gave us on the contaminated sites. You gave us an update about six or eight months ago. Where are you now? How many have you been able to remediate and clean up, and what's the base number? You said earlier in our discussion today that 1,850 sites or so still need remediation. In the last period of time, how many sites have been cleaned up, and are you going to be able to accelerate the cleanup? When you look at it as citizens, for me, anyway, two priorities are housing and water, and obviously education is the third. That's been stated publicly. But where are you now with providing clean water to folks and the actual cleanup of your sites?

Mr. Thoppil: Let's start with water. There are about 75 or 76 long-term boil advisories. When we say "long term,'' it's more than a year. We believe that with the money that's been bestowed upon us for water and wastewater, we will effectively eliminate that over the next five years.

The Chair: The 76?

Mr. Thoppil: That's right, and more. But the objective is to eliminate the long-term water advisories. That's the first objective.

The second is contaminated sites. As I said, we have done remediation as of April 1, since we've started, of over 715 sites on reserve and 48 north of 60. We have about 1,500 on reserve that are in assessment stage and 341 that are in remediation.

It's an amazing portfolio of sites in terms of their breadth of complexity; some are small, and some are very large. There are some "easy winners'' that we can do, and then some are going to be perhaps — our generation will be actually dealing with that. I think about some of those sites up North. It's an evergreen challenge for this department to work them out.

The Chair: We thank you. I kept you five minutes late, and I apologize, because it's been a long day for everybody — from our side and your side. We certainly thank you again. Have you great evening.

(The committee adjourned.)