Proceedings of the Standing Senate Committee on
National Finance
Issue No. 60 - Evidence - February 28, 2018 (afternoon meeting)
OTTAWA, Wednesday, February 28, 2018
The Standing Senate Committee on National Finance met this day at 1:30 p.m. to examine the Supplementary Estimates (C) laid before Parliament for the fiscal year ending March 31, 2018.
Senator Percy Mockler (Chair) in the chair.
[English]
The Chair: My name is Percy Mockler, from New Brunswick, chair of the committee. I wish to welcome all of those who are with us in the room and also viewers across our great country, Canada, who may be watching on television or online.
As a reminder to those watching, the committee hearings are open to the public and also available online at sencanada.ca.
[Translation]
I would ask the senators to please introduce themselves.
Senator Forest: Senator Éric Forest from the Gulf region in Quebec.
Senator Pratte: Senator André Pratte from Quebec.
[English]
Senator Cools: Anne Cools from Toronto.
Senator Marshall: Elizabeth Marshall from Newfoundland and Labrador.
Senator Eaton: Nicole Eaton from Ontario.
Senator Andreychuk: Raynell Andreychuk from Saskatchewan.
The Chair: Thank you, honourable senators.
I would also like to recognize the clerk of the committee, Ms. Gaëtane Lemay; and our two analysts, Sylvain Fleury and Alex Smith, who team up to support the work of this National Finance Committee of the Senate.
Today we continue our consideration of the expenditures set out in the Supplementary Estimates (C) for the fiscal year ending March 2018.
For the first hour of our meeting we will have before us officials from three organizations. We are going to discuss their request for funding included in the Supplementary Estimates (C).
First we welcome, from the Royal Canadian Mounted Police, Mr. Daniel Dubeau, Acting Commissioner, and also Mr. Dennis Watters, Chief Financial and Administrative Officer.
On the second panel, we have, from National Defence and the Canadian Armed Forces, Ms. Julie Charron, Associate Assistant Deputy Minister (Finance) and Deputy Chief Financial Officer.
[Translation]
We also welcome, from the Department of National Defence and the Canadian Armed Forces, Patrick Finn, Assistant Deputy Minister (Materiel).
[English]
For our third set of witnesses, from Health Canada we have Mr. Randy Larkin, Assistant Deputy Minister and Chief Financial Officer, Chief Financial Officer Branch; and Edward De Sousa, Director General, Resource Management Directorate.
Thank you, witnesses, for being here this afternoon in order to look at your requests and justify why we should accept what you are asking.
We will hear your short presentation and then have questions from the senators. I have been informed the first presenters will be Mr. Dubeau from the RCMP, Ms. Charron for the Department of National Defence, and to conclude, from Health Canada, Mr. Randy Larkin.
Daniel Dubeau, Acting Commissioner, Royal Canadian Mounted Police: Thank you so much for allowing us an opportunity to present today on our 2017-18 Supplementary Estimates (C). I would like to take a few minutes to provide some background information on the RCMP that may be helpful to better relate to what these estimates contain.
[Translation]
The Royal Canadian Mounted Police, or RCMP, has a complex and multifaceted mandate to provide federal, provincial, territorial, municipal and international policing services.
As we look at the current situation, the RCMP continues to face challenges driven by increasing concerns around terrorism and extremism, cybercrime, drugs and organized crime, as well as rapid technological advances.
[English]
The RCMP’s priority in ensuring the health and safety of its employees cannot be understated. The RCMP is currently undertaking a broad spectrum of initiatives to ensure a healthy workplace. The RCMP Mental Health Strategy will provide leadership and the promotion of mental health in the workplace, reduce stigma, identify vulnerabilities for developing trauma and stress disorders and allow our employees to access peer-to-peer support.
On the international stage, the RCMP works to further Canada’s global peace and security agenda by cooperating with and supporting the international law enforcement community, thereby ensuring that both Canadians and the global community are safe. In addition, we actively participate in multi-peacekeeping missions and provide support to nations at risk building their law enforcement capacity.
The RCMP provides general law enforcement activities to all levels of government. The RCMP delivers policing services under provincial and municipal contracts covering eight provinces and three territories, approximately 150 municipalities and over 600 Indigenous communities, which include 133 community tripartite agreements.
[Translation]
As Canada’s federal police force, the RCMP contributes to our national security through a number of mandates and responsibilities, including national security criminal investigations, through protective policing, ensuring border integrity, and investigating drugs and organized crime, to name a few.
[English]
In addition, the RCMP is the steward of the National Police Services, formed in 1966 and aimed at providing a range of services to the policing and criminal justice communities. In many instances, the RCMP is the sole provider of these specialized police support services. These services include the Canadian Police College, the Canadian Police Information Centre, Forensic Science and Identification Services, the Canadian Firearms Program and the National Sex Offender Registry.
The RCMP’s overall spending authority for 2017-18 Main Estimates was $4.8 billion, which is a combination of $2.9 billion in federal authorities and $1.9 billion in “respendable” revenues. With the additional funding provided through prior supplementary estimates and transfers from other TBS centrally held votes, total year-to-date authorities for the RCMP prior to these estimates are $3.3 billion, plus “respendable” revenues of $2 billion.
The RCMP is seeking an increase of $259.5 million in spending authority in the 2017-18 Supplementary Estimates (C). This amount consists of an increase of $251.7 million in new voted appropriations; a net increase of $2.2 million resulting from transfers from other departments; and lastly, $5.6 million related to Employee Benefits Plans.
The largest component of these supplementary estimates is a funding request of $126.4 million for security costs associated with the G7 Summit in Charlevoix, Quebec. As the primary agency responsible for security at the summit, these funds will support our efforts and activities during the planning and pre-event operations, event operations and closeout phases of the G7 events.
Another major component of these supplementary estimates is a request of $70 million related to program integrity funding in order to maintain overall RCMP operations which were first established in the Fall Economic Statement 2017. The integrity funding will permit the RCMP to maintain its operations to ensure the highest priority threats to Canada continue to be investigated and disrupted and ensure technical and sophisticated measures to support these operations continue to be available.
A further $55.1 million is related to the revised financial authorities and incremental funding for the Contract Policing Program. Based on direction from Treasury Board, the RCMP is redesigning the basis on which future contract policing incremental resource requests are calculated. This funding reflects the incremental costs to the program. The new funding model comes into effect in 2018-19.
Finally, funding of $4.5 million is provided for the grant to compensate members of the RCMP for injuries received in the performance of their duties.
The purpose of this grant is to provide members of the RCMP and their families with financial security in the event our members are injured as a consequence of their duties or prevented from continuing to provide service to the Crown. These benefits are provided for life.
That said, it will now be my pleasure to answer your questions in regard to these supplementary estimates.
[Translation]
With that said, I will be pleased to answer any questions you may have. Thank you.
[English]
Julie Charron, Associate Assistant Deputy Minister (Finance) and Deputy Chief Financial Officer, Department of National Defence and the Canadian Armed Forces: Thank you very much, Mr. Chair and members, for the invitation to present the Supplementary Estimates (C) for the 2017-18 fiscal year on behalf of the Department of National Defence.
It’s always an honour to meet with distinguished members and colleagues before the committee.
Today, I am joined by Mr. Patrick Finn, Assistant Deputy Minister (Materiel), and Chief of Force Development, Rear-Admiral Darren Hawco.
Also in attendance is Ms. Elizabeth Van Allen, Assistant Deputy Minister, Infrastructure and Environment.
The approved defence policy tabled in June 2017 — Strong, Secure, and Engaged — has confirmed the focus of National Defence and the Canadian Armed Forces in protecting Canada’s sovereignty at home, actively participating in the defence of North America and being engaged in the world to contribute to international peace and stability. Defence continues to conduct missions as part of a whole-of-government approach to defending Canada’s interests and keeping Canadians safe and secure.
[Translation]
The Department of National Defence and the Canadian Armed Forces continue to focus on strong fiscal responsibility and careful stewardship of resources in recognition of the fiscal environment in which we are operating. The magnitude, complexity and visibility of the Defence budget demand a cohesive, comprehensive and strategic approach to maximizing the efficacy of our expenditures and investments. As a result, the department continues to monitor and manage its fiscal requirements to ensure value for taxpayer dollars and support for government priorities.
[English]
Turning to the Supplementary Estimates (C) before you, I’d like to highlight key points for the committee on page 2-34 in the English version and page 2-38 in the French version.
The bottom line resulting from these supplementary estimates is that National Defence is seeking to access approximately $780 million in additional funding, including $9.5 million in statutory funding, to cover expected costs for the 2017-18 fiscal year.
This comprises $731.3 million of funding related to operating costs, $31.5 million related to capital assets, $12.3 million of funding related to grants and contributions and statutory spending of $9.5 million for employee benefits plans related in large part to the Canadian Armed Forces military operations.
The department provides to and receives programs from other departments and organizations of government where DND is not the lead department. The request includes nine transfers to and from other government departments. Of the nine transfers, two transfers are coming into the department from OGDs and seven are going to OGDs, for a total net transfer of $4.6 million.
[Translation]
This additional funding will result in a total funding of $15.6 billion for operating, $3.9 billion for capital, $177 million for grants and contributions, and $1.2 billion for statutory items. This is higher than total funding received in 2016-17 and aligns with departmental priorities and our strategy on defence outlined in Strong, Secure, Engaged.
[English]
The increased funding requested in operating costs of $731 million relates to funding identified in Canada’s defence policy for $435 million, covering items such as taking care of military families, in-service support costs for existing equipment and infrastructure, as well as implementation of the Total Health and Wellness Strategy.
[Translation]
Canada’s continued military contribution to global security initiatives in support of our NATO allies in Central and Eastern Europe, as well as international security and stability in the Middle East, resulted in a request for $271 million.
For Canadian Armed Forces support for the 2018 G7 Summit in Charlevoix, Quebec, we have budgeted $9.7 million.
[English]
Also, efforts related to continuing remediation of federal contaminated sites mostly for the Esquimalt Harbour, for $6 million; funding for Innovation for Defence Excellence and Security program, $6.2 million; funding related to projects at Canadian Armed Forces bases and other defence properties to repair and upgrade facilities for the organization, $1.8 million; as well, funding for a strategy to prevent and address gender-based violence.
[Translation]
Vote 5 funds the investment in projects to acquire the assets required to establish and maintain defence capabilities. The Department of National Defence continues to demonstrate fiscally responsible practices by monitoring cash requirements for capital projects to avoid lapses when projects are delayed and not going to use funding within the fiscal year or when projects are ahead of schedule and would normally require a request for additional funding.
Active cash management provides the information that enables DND to use funds drawn from the Consolidated Revenue Fund that are surplus in one project to fund other approved projects. This avoids unnecessary requests to relieve pressure in one area while funds are being lapsed in another project in the investment portfolio.
[English]
The $31.5 million requested in vote 5 provides funding relating to the Military Personnel Management Capability Transformation, $9 million; capital to support Canada’s contribution to global security engagements, for $6.4 million; the Interim and Future Fighter Capability projects, $5.9 million; investments to improve physical security for CAF operations and personnel, $5.8 million; and investment in projects for repairs and upgrades of facilities at bases and other defence properties, $4 million.
All but $100,000 of the $12.3 million of funding related to grants and contributions covers the assessed contribution to NATO operations required of Canada.
[Translation]
In closing, Mr. Chair, the department remains committed to monitoring and managing its fiscal requirements to ensure value for taxpayer dollars and to continue our efforts to ensure responsible spending.
[English]
My colleagues and I would be pleased to address questions or comments.
The Chair: Thank you.
Now we will hear from Mr. Randy Larkin of Health Canada.
[Translation]
Randy Larkin, Assistant Deputy Minister and Chief Financial Officer, Chief Financial Officer Branch, Health Canada: Good afternoon to all committee members.
[English]
Thank you for inviting me today to discuss proposed changes to spending by Health Canada based on what is outlined in the 2017-18 Supplementary Estimates (C).
[Translation]
Some of my colleagues are with me today in case you have questions that require program responses.
[English]
I have Ed De Sousa with me, who is Deputy Chief Financial Officer, Director General from our Cannabis And Legalization Branch, along with Todd Cain and Naira Minto-Saeed from Healthy Products and Foods Branch, should you have any more detailed questions.
In theses supplementary estimates, Health Canada’s proposed initiatives will result in a net increase of approximately $37 million, which is less than a 1 per cent increase. These investments will support important health programs and services for Canadians.
Health Canada’s total budget will be increased to $4.7 billion for the current fiscal year. This amount includes funding related to the First Nations and Inuit and Health Branch that is being transferred to the Department of Indigenous Services Canada.
[Translation]
As you know, in August 2017, the Prime Minister announced his plans for the creation of the Department of Indigenous Services Canada and the Department of Crown-Indigenous Relations and Northern Affairs Canada.
[English]
Effective November 30, 2017, the First Nations Inuit and Health Branch has been transferred from Health Canada to the Department of Indigenous Services Canada. During this transition period, Health Canada will continue supporting the First Nations and Inuit Health Branch until the completion of the full transfer of these supporting functions. These changes will be reflected in future estimates.
In terms of specifics, Health Canada is seeking funding of $32 million of interim program integrity funding to address gaps in core regulatory operations related to drugs and medical devices.
[Translation]
The department is also seeking $3 million for hosting the G7 Summit in June 2018 in Charlevoix, Quebec.
[English]
The G7 forum offers an opportunity for G7 leaders, ministers and policy-makers to come together each year to build consensus and set trends on challenging global issues. Health Canada’s role is to provide health protection and related security support services to ensure the health and safety of visiting dignitaries, their families and federal employees working on sites at this gathering.
In addition, on behalf of the Department of Indigenous Services Canada, Health Canada is seeking to access $362,000 in 2017-18 for implementation of the new Health Information and Claims Processing System for the Non-Insured Health Benefits Program. This funding will allow the Non-Insured Health Benefits Program to proceed with the project implementation phase to design, build and test a contractor-owned system as well as manage the transition of the new system while phasing out the old system.
The system supports the delivery of pharmacy, medical supplies, equipment, dental care, vision care, mental health counselling and medical transportation benefits to over 850,000 registered First Nations and recognized Inuit in Canada.
Last but not least, the department is requesting to transfer $342,000 to the Royal Canadian Mounted Police for security screening of references of specific individuals and to ensure compliance with regulations on the Access to Cannabis for Medical Purposes. This funding is necessary to conduct and submit law enforcement record checks to Health Canada, which is a requirement under the regulations for Access to Cannabis for Medical Purposes.
In conclusion, the funding being requested in these supplementary estimates will help the department and the Government of Canada continue to address key health priorities for all Canadians. Thank you for inviting me before the committee today. I would be pleased to answer any questions you may have.
The Chair: Thank you very much.
Senator Marshall: I want to start off with the Department of National Defence, and I want to have some discussion on the costing of Canada’s defence policy that was released, I believe, last year. I’m also referencing the Parliamentary Budget Officer’s report, and he’s talking about the plan in increased spending for the new policy, which will increase the department’s spending from $18 billion to $32 billion, which is, I think, about $14 billion over eight years.
Can you give me some idea as to how that $14 billion is going to be phased in? Because there is, as you indicated, $435 million in supps (C), but the spending will have to be ramped up higher than that in order to reach the extent of funding indicated by the PBO. Can you give me some insight into how the funding will be phased in?
Ms. Charron: The defence policy was launched in June of 2017, and as we are ramping up to bring the money inside the department, we’re looking at specific investments that are going to be made. As we need the money, we will bring them in.
For 2017 and 2018, because the year was well advanced, we’re bringing in only $435 million, which is in-line with what we planned. But as we bring in new equipment, we will increase our in-support service costs, and we will also bring in money related to operations for this new equipment.
I do not have the information with me today. I can certainly provide the information. It is in our policy that’s been released. But we will be bringing the money in as the equipment will be coming and as we increase our in-service costs. We are also launching new initiatives, such as the Total Health and Wellness Strategy, which we expect we’ll be ramping up next year in 2018-19.
Patrick Finn, Assistant Deputy Minister (Materiel), Department of National Defence and the Canadian Armed Forces: A big part of the policy, of course, growing the size of the military, both the regular, the Reserve Force, growing the public service to execute it, plus personnel costs are a significant piece of it; so you’ll see that grow over time. Some pretty significant capital investments will occur over that time. The execution of our surface combatant project at almost $60 billion, the replacement for the fighters, estimated at about $15 billion to $19 billion.
It’s a significant investment in defence, in people, growing the force, growing the organization, investing in equipment and infrastructure to support it. As indicated, more in-service support, growing a much-broadened cyber capability, and a number of other things we’re investing in, all of which total the growth that you indicated, on top of what will be the natural growth for the cost of our equipment, which grows at 5 per cent or 6 per cent a year.
Senator Marshall: The $14 billion which you’re expecting over the next so many years, the information you’re going to provide to us now as a follow-up, will that show the full extent of the new funding? Will that show the $14 billion? And will it be broken down by year and by type of investment? Or is it just going to be totals?
Because you’re talking about capital. You’re talking about money for the reserves, fighters and infrastructure. Is it laid out so that everything is itemized? Or is it just a certain dollar amount each year? What can we expect to see?
Ms. Charron: You can expect to see the dollars per operation, capital and grants and contributions. We are not in the position at this point to provide you with the information itemized by project simply because there may be some delays in the projects.
Senator Marshall: Is there any money in the new budget? I haven’t had time to read the entire budget, but can you tell me the funding? Because if the funding that you’re talking about, the $14 billion, is over nine years, and the budget shows a five-year projection, can I find the money in the budget?
Ms. Charron: I don’t believe you can find it in the budget. But in SSE, the money has been earmarked in the fiscal framework. It’s already set aside in the fiscal framework to be given to National Defence.
In the budget yesterday, National Defence received additional money for Operation IMPACT, which are operations mainly in Iraq and Syria. It’s money we will invest in Jordan and Lebanon for additional capabilities over there, including a road. We received money for gender-based violence. Most of the money we have received in SSE.
Senator Marshall: You’re saying that the money for the next nine years is going to be $14 billion of new money made available, but there’s nothing provided in the budget. But you’re saying there’s money somewhere in the fiscal framework, wherever that is?
Ms. Charron: That is right. When the government presented the policy on defence, the money we have requested for capital and operations has been earmarked in the fiscal framework for the next 20 years. We have money set aside for capital assets, $108 billion over 20 years on an accrual basis as well as more than $30 billion for operations.
Senator Marshall: Can you tell me how much of the $14 billion will be for the new fiscal year? It’s not in the budget, but it’s in the fiscal framework. At some point you’re going to be looking for supplementary funding. How much money will you be looking for in the new fiscal year?
Ms. Charron: In the new fiscal year, for 2018-19, we are in the process of finalizing the Main Estimates. Right now we’ve tabled our interim estimates, and we will be calling the money once the projects are ongoing.
You can expect approximately the same amount as last year. At this point I cannot tell you exactly how much we will be calling from the yesterday’s budget, because we will only be calling money we need to carry on the operations.
Senator Marshall: That’s not very reassuring because we talked about the Strong, Secure, Engaged Defence Policy last year and there was no money provided. And this year, even though we’re talking about $14 billion, there is nothing in the budget.
My next question, just to finish up on this line of questioning, the Parliamentary Budget Officer was looking for more information from the department. Actually, you were talking about the Strong, Secure, Engaged Defence Policy, and he says he expects to receive this data. He asked for data so he could get a handle on the numbers, similar to what I am trying to do. He says the PBO expects to receive this data from National Defence by the end of February 2018. Was that information provided to the Parliamentary Budget Officer?
Ms. Charron: Thank you. We are in the process of gathering the information and we are on track to be able to provide it to PBO.
Senator Marshall: So today is the end of February. It’s not ready to go to him yet?
Ms. Charron: It would be today or in the very near feature. We have been in contact with PBO and the department is well positioned to be able to provide the information requested by PBO.
To go back to your question on additional money being requested, I’d like to point out that the money we have in SSE is on an accrual basis. So for capital, what you see in SSE is the equivalent of the usage of the asset once the asset is in service. Therefore, we will be calling money for the purchase of those capital assets, but in the budget what you’re seeing is money on an accrual basis as opposed to a cash basis. That’s the discrepancy that you can see between the budget, the Main Estimates and the cash we’re asking for the department to be able to operate.
Senator Marshall: Well, that makes me somewhat suspicious, but I think my time is running out. I note that the PBO says the $18 billion to the $32 billion is on a cash basis. You’re saying that because you’re talking accrual, that’s why the money is not there right now?
Ms. Charron: I might not have been clear. I’m sorry about that. What I meant is in the budget yesterday, we have not seen additional money because the budget is on an accrual basis, and we’ve already asked, as part of our interim estimates, for some money to operate for next year.
[Translation]
Senator Pratte: My questions are for Commissioner Dubeau. Thank you for being here with us today. You are asking for $126 million, a significant amount, for the G7 Summit in Charlevoix. My information indicates that the RCMP spent $330 million on the G20 summit in Toronto and the G8 summit in Huntsville. Clearly that amount was for both summits, including the G20, thus it is a little more complicated. Therefore, are you certain that $126 million will suffice to cover all RCMP activities for the Charlevoix summit? Or is this just your first request?
Mr. Dubeau: It is just the first request; there will be another next year. I will ask my colleague to provide the total budget for the G7. There were two requests made this year, and we will be submitting another request for the summit itself at the end of the fiscal year. We started planning last year and are incurring expenses now, but there will be another request next year. Denis can tell you more about it.
Dennis Watters, Chief Financial and Administrative Officer, Royal Canadian Mounted Police: We requested $126 million this year; next year, we will be asking for $125 million to $126 million. We have to plan the summit. There are infrastructure to be set up, vehicles to be purchased, and the grounds to prepare. Much of the work must be done during the current fiscal year to prepare for the summit, which will be held in June. Next year, the work will focus on human resources because a large number of officers will be deployed to the Summit. Our expenses mainly pertain to accommodation because people will need hotel rooms, meals, vehicles and infrastructure. Our request spans two years and totals approximately $260 million.
Senator Pratte: I am not asking you to reveal details about your security measures. Have you drawn lessons from past summits where the RCMP was present, such as the Summit of the Americas in Quebec City and the Toronto summit? It was not necessarily the RCMP that was involved in the unfortunate events that occurred in Toronto, but are there lessons you can apply to the Charlevoix summit?
Mr. Dubeau: Yes, senator. When a summit has ended, we have a debriefing to review what we learned. I know that our planners have spoken with the G8 people, went to see them, and discussed how things went and what to improve. Yes, we always modify our planning when a new summit is announced.
[English]
Senator Pratte: I have a short question for Health Canada. The main part of your request is $31.6 million for funding for maintaining core regulatory operations for therapeutic products. In your presentation, you didn’t really explain what was meant by that. Would you care to explain exactly what this money is for?
Mr. Larkin: Yes. Thank you for the question. We have gaps in regulatory approval processes for prescription drugs, as well as for medical devices. We are not able to keep pace to the demand for approvals.
There is also money there in order to maintain our enforcement and regulatory operations with respect to inspections of pharmaceutical and medical device manufacturers.
Senator Pratte: When you say you have gaps, what do you mean? The demand is stronger than you expected?
Mr. Larkin: No, it’s not that the demand is stronger than expected. I have a colleague here who could provide you with more detail. It’s that this is a cost-recovery program for which we are not recovering sufficient funds to cover the costs we incur.
Right now there is a consultation on increasing our costs using the Food and Drugs Act, the first phase of which is underway. Right now the department is deficient in terms of resources to cover the costs of approving those drugs and the inspection and enforcement.
Senator Pratte: This is, in theory, financed by industry, I suppose?
Mr. Larkin: In theory.
Senator Pratte: In theory. Oh, that’s interesting. Thank you very much.
Senator Eaton: Welcome, all. Thank you for coming. Ms. Charron, Mr. Finn, I’d like to follow up on Senator Marshall’s question on the $14 billion in the fiscal framework. I noticed there was nothing about national shipbuilding, ongoing expenses related to the Coast Guard’s Offshore Oceanographic Science Vessel or the joint support ships. Have we fallen off schedule? Has the national shipbuilding strategy fallen off schedule?
Is that why we don’t see anything in the estimates?
Mr. Finn: Thank you very much for the question, senator. The $14 billion is what we grow to. So as indicated, the total in the fiscal framework is much higher.
Senator Eaton: When this gets on schedule, are you going to pull it from that?
Mr. Finn: We are spending against the National Shipbuilding Strategy. It is not so much on the Coast Guard side. That would be our colleagues at Fisheries and Oceans who could come and talk about that. For our ships, the joint support ship, the Arctic offshore patrol ship, the Canadian surface combatants, there is already money in our existing budget that we’re spending to execute that. With the Arctic offshore patrol ships, we’re starting to build the fourth ship. And for joint support ships, we’re beginning construction very soon to pull that through. So we have money, and there will continue to be money in the years ahead that we will pull down to continue to move that. Same with the surface combatants, which is the largest of it. It’s $56 billion to $60 billion. We’re in the evaluation.
Senator Eaton: Surface combatants, does that mean destroyers, in the old words?
Mr. Finn: Absolutely, frigates and destroyers are what we would call them. It’s to replace the ships we recently retired, our destroyers and we’ll also replace our current Canadian patrol frigates.
Senator Eaton: Are we on time for those things? We’re on schedule?
Mr. Finn: Again, from the original schedules, we’ve seen delays. We’ve seen things as we’ve ramped up. With our most recent approved schedule, when we started building the Arctic offshore patrol ships, we’re on schedule with that, the first vessel being launched this summer and delivered to the navy next summer. As indicated, we’ll start delivering the joint support ship. We’ve seen some delay there, now catching and pulling things to the left, surface combatants as well.
To the dates we put into the shipbuilding strategy in 2010, there have definitely been delays as we’ve learned and ramped up. We’re now recovering and building schedules that are more realistic and will start seeing new ships delivered to the navy starting next year.
Senator Eaton: So with the new things you’ve put on track, you’re on schedule?
Mr. Finn: With the most recent things where we’ve updated, sought approvals and that we’re working to, yes. We’re not aligned with where we started in 2010.
Senator Eaton: I’m not sure whether you can comment on this or not, before I go to Health Canada, but when Minister Brison was here, he very much supported the idea of doing a Senate study on military procurement because he said it’s very difficult for non-military people involved in running ministries to make decisions as to what the military might need.
Would you support that or is it too awkward for you to answer? I understand if you say it’s too awkward for you to answer.
Mr. Finn: I can’t speak for Minister Brison. I come from a military background, with 36 years in the military, so I have a better understanding than somebody working in procurement about military requirements. There is some complexity to understand but I would say there is a dedicated team of people at PSPC, Innovation, Science and Economic Development, and us —
Senator Eaton: So you don’t think we can go and learn from countries like Germany, New Zealand, England, Australia, who managed to do their military procurement on a more timely ongoing basis than we’ve managed to in the last 20 years?
Mr. Finn: Senator, I think there are definitely things to learn. We’re engaged with them as well. I would caution the timeliness. Generally, we’re closely engaged with our allies, whether it’s Five Eyes — I’m the national armaments director for Canada at NATO. We share a lot of best practices and issues there. There is a question around procurement of military equipment, small quantities, highly complex, cutting edge where I would say most of our Western allies share similar difficulties.
Senator Eaton: May I ask a question to Health Canada? There is an item here, $3 million for hosting the Group of Seven leaders summit. I think it’s a three-day summit or a two-day summit?
Mr. Larkin: I’m not sure how long the summit is, senator.
Senator Eaton: I think it’s two days, three days at most. Because it’s in Charlevoix, are you building a trauma centre? Because $3 million is a lot of money for tasting food and making sure the kitchen is clean and helping someone with a cold or a headache.
Mr. Larkin: Right; that’s a good point. I think the money is to be used for providing those medical support services in the event they’re required and having doctors, physicians and medical practitioners available.
There are also the services you mentioned, in terms of ensuring that the site is meeting health regulations and so on.
Senator Eaton: I’m sorry, I don’t mean to interrupt you, but you can’t be specific? You don’t know?
Mr. Larkin: I don’t have that specific level of detail, but I could get it for you, if you’d like.
Senator Eaton: That would be very useful. Thank you.
The Chair: In returning answers to senators, please send them to the clerk.
[Translation]
Senator Forest: My first question is for Mr. Dubeau. Your fiscal year ends March 31, does it not?
Mr. Dubeau: Yes.
Senator Forest: I am having difficulty understanding how you account for your organization’s needs. There is the $125 million by the end of the fiscal year — which will be here in one month and a few weeks — for purchases to be made in the next fiscal year. There is the planning aspect, but the majority of expenditures — namely, the acquisition of goods and equipment, the vehicles, accommodation for staff, and the close-out phases — will be part of the 2018-19 budget. Are the expenditures totalling $125 million in the 2017-18 budget related to planning activities and procurement of goods and equipment?
Mr. Watters: I do not have the breakdown by year, but a good number of projects, such as infrastructure and vehicles, were expensed earlier in order to guarantee their delivery. We have to purchase other equipment, such as radios, for the G7. Many purchases will be made this year.
Senator Forest: You pay before they are delivered?
Mr. Watters: No. We only pay for the orders planned for the current fiscal year. We will receive the vehicles and radios before the end of the fiscal year. Next year the expenses may be higher because we have to cover salaries, hotels, meals, and so forth. We should not forget that many people are planning the G7 at this time.
Senator Forest: Do you have a project budget? Let’s say that I am part of your organization. Is my salary allotted to the G7?
Mr. Watters: Yes.
Senator Forest: You have requested $4.5 million for members’ compensation. How many members does that cover?
Mr. Dubeau: I will answer in English.
[English]
This is the grants and contributions to Veterans Affairs, which administers our program for injured members. If you asked Veterans Affairs, I believe it’s about 10,000. Both serving and retired members are getting benefits. The increase goes on as we have more members, because they have been injured, who are applying for pensions or some type of assistance. That’s what’s going on there.
[Translation]
I don’t have the details, but I believe it is about 10,000 members, including retired members. In the RCMP, it is about 3,000 to 4,000. I can get back to you with the details, if you like.
Senator Forest: Can you send that to the clerk’s office? Thank you.
I have another question concerning National Defence. National Defence is asking for $9.7 million in additional appropriations. What is the total budget that will be allocated to Defence for the G7?
Ms. Charron: Thank you for your question. The total budget is approximately $34 million, including $9.7 million for 2017-18. In the budget tabled yesterday, we received approximately $26 million.
Senator Forest: What are your main expenditures for this event?
Ms. Charron: The main expenditures are the salaries of the reservists assigned to security, that is their wages, and the cost of accommodation and meals. That will cover most of the expenses.
Senator Forest: Thank you.
Mr. Finn, with reference to the $14 billion in total investments, you stated that there were some delays in the schedule. Which projects are affected?
Mr. Finn: In the construction of ships, senator, or in any project?
Senator Forest: The ships.
Mr. Finn: At the start of construction of the Arctic offshore patrol ships there was a delay of about six months. We have not made up for the delay, but we are on schedule with construction.
Senator Forest: Have you increased the delay?
Mr. Finn: We have maintained that aspect. Construction of the fourth ship will start this summer.
As for the initial scheduling of ships to be built on the west coast, there were some delays there as well, delays of a few years that we are making up. We are currently in negotiations for the start of construction this summer, if possible, and trying to see if we can get back on schedule.
With respect to combat vessels, once again there is a delay of approximately one year or so. The bid solicitation has been completed, the evaluation is being done, and the contract will be signed this fall. I would say that, across these projects, considering the situation we were in and the readiness of the market in Canada, we have experienced delays. There was an issue of readiness on our part as well. However, we now have a program that is much better defined with specific exchanges. There is better follow-up.
Senator Forest: Are you staying on budget?
Mr. Finn: Once again, as part of the Strong, Secure, Engaged Defence Policy, all budgets were updated and the combat vessels were at $26 billion. They are now at $56 billion to $60 billion, and the others have also been submitted. Since then, with the updates announced last year, we are in a better position with respect to budgets.
Senator Forest: But they have increased significantly.
Mr. Finn: Yes.
Senator Forest: I have one last question that will determine whether I should complain to the chair. You undertook to send us the reasons that led to the decision to cancel the Obelix order with Davie. Did you send us this document?
Mr. Finn: I do not recall exactly, senator. I apologize. There was never a contract or request.
Senator Forest: I am not talking about a contract. I specifically asked how such an important decision was made. In order for senior command to make that decision, an analysis must have been done, it was not a whim, and I remember saying that. You agreed to send us the reasons that led to this decision.
Mr. Finn: Actually, senator, it was the analysis in the context of everything in the maritime domain. I believe so, but I do not know. I will find out right away.
Senator Forest: If so, then I will be disappointed with the chair; if not, I will be disappointed with you.
Mr. Finn: I understand, senator.
Senator Forest: I have one last question. Each of the three groups has supplementary estimates. It is the year-end. With respect to the G7 Summit, do any of you know the total cost to Canada of the summit, the total budget for the summit?
Mr. Dubeau: I know that we report all our expenses to a deputy minister who is managing this file together with Treasury Board. At the end of the day, there will be a total cost.
The Chair: Thank you for your question for National Defence about Davie. We’ll ask our analysts to dig out this unanswered question and return it to you, Mr. Finn and Ms. Charron, so you can get as accurate an answer as possible to Senator Forest, via the clerk.
Let’s continue with question period.
[English]
Senator Andreychuk: You’ve been asked a few questions about your national shipbuilding strategy. The last answer confused me a bit. You said you were on schedule and you don’t believe there will be gaps, but then you said, “if it is possible.” That gives me some worry about whether the schedule will be maintained. Therefore, it could create gaps, which causes problems for the shipyards. Who has the responsibility of the oversight to manage that?
Mr. Finn: Thank you, senator. To go back, I talked specifically about project schedule. I didn’t actually mention gaps so maybe I’ll come back to that.
As I indicated, marching toward the most recent approved schedules, I don’t want to leave anyone with the impression that since we started this in 2010 that it’s unfolded and the schedules have been as we laid out. They have not been. We’ve learned, as have the yards, and become more disciplined. As with any of our major capital projects, irrespective of suppliers, there are risks.
In the context of the gaps — we are seeing gaps, not no work in the yard, but some reductions and things occurring. Some is happening, for example, on the West Coast, where the nature of our agreements with the yards also compels them to look for other work. That has been occurring whether it’s other maintenance work or commercial work.
Specific to the government, the strategy overall is managed by Public Services and Procurement Canada with a governance that has National Defence, the Coast Guard, Innovation, Science and Economic Development and central agencies at the table. We’re actively looking at what should or would be our role in it but we also have an active governance with the shipyards to make sure it’s clear what we could do. That is, within the authorities and the levers that we have and also what they need to do. As we speak to them through those contracts, they are also marketing internationally some of their products to try to bring more work to bear. It is about load levelling the order book to try to deliver. That has always been the intent. From international best practices as we talk to our allies about this, we know having a fairly complete order book is probably the number one thing that’s going to help us drive down costs in the ships we build.
Senator Andreychuk: So it’s back to the procurement officer somewhere who is the oversight?
Mr. Finn: No. When I talk about the governance, it’s actually at the assistant deputy minister or deputy minister level. There are also groups of ministers from those departments who are very active in the management of how this unfolds.
Senator Andreychuk: So if there was a gap, it would be a deputy minister who would advise a minister that there is a problem?
Mr. Finn: Generally, I think on all topics that would be the case, senator. It would be me, for example, in the case of defence, through an ongoing process, whether it’s my deputy or central agencies, or others who keep them informed on what’s unfolding. I’m the project leader for the defence projects but also set up governance from myself to my deputy and generally from my deputy beyond.
Senator Andreychuk: I know the chair will cut me off so I will not ask any more questions. I was going to go to NATO and some of the other initiatives, particularly with what Europe is doing and how we are meeting our commitments there, but I will not do so.
However, I want to ask Mr. Dubeau from the Royal Canadian Mounted Police about cyberspace. Cybersecurity is very important. The money seemed like a lot but really isn’t if we are going to do the job properly, and we’re behind.
I think we’ve ignored a lot of our security to our detriment in trade, our own security, immigration, what have you. You’ve been seized with some of that before, and now you’re going to get some money.
But you also talked about policing across Canada, and there’s certainly a gap there. The demands are increasing. If you’re in rural Saskatchewan, try phoning and getting someone to come. We have gaps, and I know it’s federal-provincial.
You’ve enumerated all the things being laden on you. Where would you find your entire mandate now? It seems to have come layered upon layer. Perhaps you could provide it, so we can see exactly what your portion is.
In that context, we’re now embarked in looking at this whole new initiative under Bill C-45 —marijuana — and that’s going to hit the training at Depot in Regina, which I’m very concerned about. Every detachment is going to have trained officers ready to respond. It took us years with Breathalyzers to get it right, and now we have someone who is trained on virtually every shift — or at least that’s the theory. We’re going to have to do the same thing with marijuana.
Where in the budget do I see any requests or money for this new initiative under Bill C-45 that’s going to hit you very strongly in training, capacity and personnel? We’re going to have our biggest problems at the street level. I’m surprised that Senator Forest did not bring up the municipal responsibility and the federal responsibility to provinces, et cetera.
Where do I find those figures? Have you factored them in, or do you know yet?
Mr. Dubeau: It’s a very good question. It’s something that’s seized us. There has been money in the past given in our preparation of the bill coming alive in the course of this year. The forces have been very active building capacity on our drug recognition experts, which is the program you’re talking about, where we’re training our people up to be experts and assisting other police forces.
I want to make it clear that drug-impaired driving has always been an offence in Canada; it’s not something new. The organization has been working on that for years, and former Commissioner Paulson had a big push on impaired driving. We’ve been gearing up and continue to do so.
There was money in the former budgets given to us to assist in the drug recognition training, which we’re now rolling out. We are working with Public Safety and other colleagues to look at what type of screening device could be used, because there are other jurisdictions that have used screening devices, so it’s about what we could adopt as an organization.
You’re right there’s a training capacity piece that has to build up over time. We are building it up. As I said, though, impaired driving is an offence that has been on the books for a long time. Many of our individuals already have an idea. It’s to get to the expertise and capacity pieces, which are coming.
Senator Andreychuk: Where are you? Are you saying you’re satisfied you have the capacity now to handle things?
Mr. Dubeau: Currently, our capacity in the field, we have about 200 trained members on drug recognition experts for the RCMP. We’re running a bunch of other courses coming up —22 more courses— to try to train more people over the fiscal year. I can’t remember the exact timing, but we have 22 other courses we intend to run to bring our capacity up.
Senator Andreychuk: So you feel you have the resources to do that?
Mr. Dubeau: We are at the point where we feel we have resources out there. It remains to be seen what the usage will be, because that’s the unknown when you legalize recreational marijuana. We don’t know what the uptake will be. That’s unknown to us at this point.
Senator Cools: My question is for Ms. Charron. You talked about gender-based violence. There are only two genders. Every act of violence is by one gender or the other. I just wonder if you could tell us more fully what you mean by “gender-based violence.” There are only two genders.
Ms. Charron: As part of SSE, the department is increasing its money for the family crisis team and having resources for shelters for women around the bases, for example. So we’re trying to equip our members to have the resources they need, should there be violence by one or the other gender, but also taking into consideration the impact on their families.
In this supplementary estimate, we are asking for $800,000 to increase the funding for family crisis teams and the support for those affected by violence.
Senator Cools: Colleagues should know all the data and the research on family violence shows women are equally as violent as men; the rates of violence are equal, the rates of severity are equal and even the rates of reaching for weapons are equal. So I was wondering if this was a new term that I’ve not noticed before — “gender-based.” Anyway, I suppose it’s a good thing that we keep our eyes and ears alert to these things, particularly in the military, where you have situations of families living side by side and possibly facing undesirable consequences.
In any event, any action to reduce violence is a good thing, by whichever gender.
The Chair: There’s a forceful request of senators for a second round, so we’re going to have one.
Senator Marshall: I want to continue the discussion on the defence policy. I am interested in the information we spoke about earlier, and if you could send that to the clerk, this would be very much appreciated. That would cover the $14 billion over the eight years to whatever breakdown you have.
Has the fiscal framework you spoke about been approved by cabinet? I’m curious as to what process it has to continue to go through in order to make it into a budget.
Ms. Charron: Thank you for your question. When we presented the policy on Strong, Secure, Engaged, we outlined the need for the funding and it was presented by our minister. It was also reiterated in the economic update in the fall, which has been taken into account in the assumptions for the budget and for the growth in the economy for Canada.
So it’s been set aside by Treasury Board and the Department of Finance for future use.
Senator Marshall: It just hasn’t made it to the budget yet. But does it have to be approved by cabinet before it gets in the budget? Would you know?
Mr. Finn: It depends on which element it is, senator. For example, if it’s money set aside for a major capital project that’s forthcoming, and there’s a number described in Strong, Secure, Engaged, as we always do, something like that would go back to cabinet, be approved there and be subject to follow on Treasury Board approvals.
There are other areas where it’s been approved. As our minister often describes, the money has been approved and set aside. I describe it as an “odd accountant.” The fiscal framework is the bank from which we draw, but it’s specifically earmarked for defence and very precise expenditures.
Senator Marshall: And you would expect to see that in some budget?
Mr. Finn: We would, whether it’s in a budget or a given fiscal year. That comes down to whether it’s itemized in a budget. But it becomes part of our ask for that year in our estimates.
Senator Marshall: You were talking about the detail — there wasn’t a lot of detail with regard to the $1 billion. But I notice in Supplementary Estimates (C), it’s right down to the dollar. It’s $435,306,513.
So there must be a detailed breakdown. I’m not looking for the breakdown now. I’m just asking: Is there a detailed breakdown you could send to the clerk so I could look at it?
Ms. Charron: Yes. Thank you for your question. We do have one, and I do have the information for the budget for the next eight years that’s ramping up from $14 million to $30 million. I do have it by vote, and I can provide this information to the committee.
Senator Marshall: Okay. Vote 1C for Supp(C) is $435 million. Is it broken down any finer than that? Would it say how much is for salaries, how much is for — I’m just trying to get a handle on what kind of detail there is.
Ms. Charron: No, I don’t have the details for the salaries, but what we did when we built SSE, the Strong, Secure, Engaged policy, is we looked at our budget, what we have right now, the operations that we’re conducting, and we’ve reassessed needs, given augmentation and capacity, the additional equipment we needed to buy and the impact on the in-service support costs. All of those elements have been taken into account, but I don’t have it broken down. We also have to understand that, in the past, Defence had something called the escalator, which is no longer part of separate funding we receive. It’s taken into account the inflation factor. That has created an increase in our vote 1 for operating. But I do have the breakdown, or our estimation, based on the best of our knowledge at the time, for the 300 projects. I can provide this information to the committee.
Senator Marshall: Okay. Thank you very much.
Senator Eaton: For Health Canada, in Budget 2017, chapter 3, the government committed $9.6 million, over five years, for public education regarding legalized cannabis. On October 31, 2017, the government announced a new investment of $36.4 million, over the next five years, for cannabis education awareness.
Have you started the cannabis campaign? I haven’t seen it anywhere or heard it, and I was just wondering.
Mr. Larkin: Thank you very much, senator. I think that question is best answered by my colleague from the program, the cannabis branch, Todd Cain.
The Chair: Could we ask him to come forward and identify himself for the record, with his title?
Todd Cain, Director General, Organization and Launch Directorate, Health Canada: Todd Cain. I’m the Director General of Organization and Launch for the Cannabis Legalization and Regulation Branch.
In short, senator, the work is well underway. The public advertising component that would be the most visible piece will happen in the coming months, but the work that’s started, as much as a year ago —
Senator Eaton: I don’t mean to be rude, Mr. Cain, but we’re getting so much of that in Legal and Constitutional. I sit on that committee as well. “Oh, in coming months, you will see. Coming years, you will see.” Is it starting April 1, May 1, June 1, after legalization? I’m sure, in your position, you have some idea of whether you’re behind, whether you’re on top of it. Please give us straight answers.
Mr. Cain: Sure. Work actually has started. It started a year ago. It has, to date, been largely accomplished through two methods. One is social media. So active social media around the health risks of using cannabis started as early as last April.
Senator Eaton: Didn’t see anything on my Twitter account.
Mr. Cain: That has been working its way through social media, through Twitter and Facebook and those sorts of things.
Senator Eaton: We haven’t seen any of that.
Mr. Cain: The other tool that launched earlier this fiscal year is something we call the education toolkit. It’s something used by parents, by partners, non-governmental organizations, to help to sit down and frame conversations with teens and youth. That’s a document that has been distributed, old-fashioned paper copy, about 200,000 times over the last couple of months, and it has been downloaded an untold number of times.
Senator Eaton: Has that been downloaded to schools? Is that what you’re saying?
Mr. Cain: Schools, NGOs across the country, partner organizations in the health care sector, community organizations like Big Brothers, Big Sisters, those sorts of organizations, are using this to do programs within their organizations.
Senator Eaton: Could you do me a very large favour and send a copy to this committee so we could actually see?
Mr. Cain: By all means.
Senator Eaton: Thank you very much. But the rest, posters and advertising, that will start soon?
Mr. Cain: Yes. The creative work is underway right now to design the ad concepts, with a launch date in the early spring. The second big tranche of the advertising will be actually around the law itself, and, obviously, that needs to wait for Parliament to complete its work before we finalize content.
The Chair: Before we close, I want to bring to your attention two little questions.
[Translation]
Health Canada currently pays for health care for First Nations across the country, especially in the North, doesn’t it?
[English]
Mr. Larkin: Thank you, senator. That branch has been transferred to Indigenous Services Canada. So, while those funds remain on our books and there’s an adjustment, referred to as a “deemed appropriation,” for the Main Estimates, those services are now being provided by the First Nations Inuit Health Branch, but as part of the Department of Indigenous Services Canada.
[Translation]
The Chair: Is your department having trouble retaining nurses to provide services to First Nations because of the problems with Phoenix?
[English]
Mr. Larkin: That’s a very good question. The problems with Phoenix did impact us with respect to nurses. Nurses, as you know, have a base salary. They have a lot of overtime. They have pay for remote locations. They have travel, and a lot of that caused us to go into flux and have difficulty with keeping pace to the remuneration that was required for our nurses, that they were expecting. Health Canada responded by setting up and investing in its own compensation unit. We were able to provide specific services to nurses so they weren’t out of pocket on anything related to their remuneration. We’re continuing to do that.
Right now, we have a memorandum of understanding with the Department of Indigenous Services, where all of the corporate support functions are continuing to be provided by Health Canada. So human resources, my finance group, procurement, facilities management, they’re all being provided by Health Canada, under a memorandum of understanding, until such time as the Department of Indigenous Services Canada is capable and prepared to take those services. We’ve provided assurances to our employees, not just nurses but to all of our employees, their pay files and anything related that may be impacted by Phoenix will not transfer until we have assurance there’s no impact to their pay.
The Chair: Thank you for the information, but could you also, for clarity, explain if we have lost nurses in First Nations and Inuit communities in Northern Canada because of the Phoenix pay system?
Mr. Larkin: I wouldn’t be able to answer that.
The Chair: Can you verify and please provide the information to the clerk?
Mr. Larkin: Sure.
The Chair: Last question: When we talk about access to cannabis for medical purposes, what specific security-screening requirements are currently in place to ensure applicants do not have ties to organized crime?
Mr. Larkin: I’ll call upon my colleague Todd Cain once again. I’m sorry for this, but, if you’re going to get the specifics, you may as well get them from the —
The Chair: That’s okay, Mr. Larkin; we appreciate that.
Mr. Cain: Senator, just to clarify, your question was around ensuring organized crime doesn’t play any role in the production side. The existing system under the Access to Cannabis for Medical Purposes Regulations has quite an extensive system of security clearances. For those who are in positions of influence or control in organizations, they are required to submit extensive documentation on their background. Then, we work with the RCMP, who, in turn, engages with police of local jurisdiction to do an extensive criminal intelligence check to verify whether there are any connections whatsoever with organized crime. On that basis, we make a determination on whether the individual and, therefore, the organization is safe to include in our system of medical marijuana.
The Chair: Thank you very much.
In closing, the final question will go to Senator Forest.
[Translation]
Senator Forest: Mr. Dubeau, it’s clear that Bill C-45 will have an impact on your service offering. This is an activity that’s currently illegal, and you say you have 200 officers who have been trained. In your opinion, in terms of equipment and training — I’m thinking of things like roadside testing to detect cannabis-impaired drivers — I imagine that in Canada as a whole, there are significant needs? My subquestion is that this is a challenge that needs to be addressed by your organization and by provincial and municipal police, so is there any kind of partnership developing in that area?
Mr. Dubeau: We work closely with other police forces to help them with training. Our drug recognition expert training program is terrific. It’s been approved by the Supreme Court. As for tools, the screening devices will also be very useful for carrying out our roadside tests.
Senator Forest: Are these devices in use in other countries or states that have legalized the consumption of such substances?
Mr. Dubeau: I believe so, but I can check and get back to you later.
[English]
We are working closely with Public Safety as well Health Canada on the tools.
Mr. Cain: The assessment of the devices is under way right now against standards established through the DDC. A series of volunteer experts from across the country, forensic pathologists and so on, they have established criteria to assess the devices. They’re in that process now. Some devices are in use now in other countries, but they’re being assessed against made-in-Canada criteria.
[Translation]
Senator Forest: These devices need to be purchased by the RCMP, but they’ll also need to be purchased by municipal police forces, which may have less resources. They may not have Supplementary Estimates (A), (B) and (C) that they can use to pay for them. Is Health Canada going to make sure these devices are made affordable to small communities that have their own police forces, especially indigenous communities whose resources are more limited?
Mr. Cain: I can answer that. The Department of Public Safety is in the process of finalizing fiscal arrangements with the provinces and territories to assist them with the acquisition of these devices and training on how to use them.
[English]
The Chair: To the witnesses, thank you for sharing your opinions on the matter.
Senator Andreychuk: For clarification, I know the impaired driving training, but the new devices is the question I was really putting to you. I used to prosecute and defend, so I know the impaired driving tests and all that, but it’s the new drug devices and you’re saying you’re well prepared for that now?
Mr. Dubeau: No, I’m saying we’re using the drug recognition expertise, which is where we’re at. We need the device — sorry if I misunderstood.
Senator Andreychuk: That was my question. You left me with you’re ready to go on all of that.
Mr. Dubeau: The device will be a valuable tool for all police agencies across the country and that’s going to be important.
The Chair: Thank you, Mr. Dubeau, for the clarification; and thank you for raising that question again, Senator Andreychuk.
Thank you to the witnesses for sharing your opinions. We might call you back in the event that we want additional information.
For the second hour we have, on our panel, the Office of the Parliamentary Budget Officer. Representing the PBO, we have Jason Jacques, Senior Director, Costing and Budgetary Analysis; and Jason Stanton, Financial Analyst. We want to say again, as we have done in the past, when we ask you to appear, you are always available and we thank you for that.
I have been informed by the clerk that Mr. Jacques will make a short presentation and then we will follow with questions. Mr. Jacques, the floor is yours.
Jason Jacques, Senior Director, Costing and Budgetary Analysis, Office of the Parliamentary Budget Officer: Thank you very much, Mr. Chair. For our part, we always appreciate the opportunity to appear before the committee. Of course, all the work we do is for parliamentarians in both houses. We certainly appreciate the opportunity to present and speak to the work we prepare for you and hopefully receive some useful feedback we can incorporate to improve the products we prepare for the committee.
First, I would be remiss if I did not say the Parliamentary Budget Officer, Mr. Fréchette, does send his regrets. Unfortunately, he had a conflict with an appearance at another committee far less important than this one. However, he did commit to doing it some time ago.
With respect to our analysis in Supplementary Estimates (C), I know you’ve already heard from multiple witnesses so I’ll keep things at a fairly high level.
Overall, we’re looking at approximately $3.7 billion. This typically is on the higher end when you actually look back over the past 10 years or so of what typically ends up in Supplementary Estimates (C).
As members around the table are well aware, once the appropriation bill is actually passed, government departments and agencies will have a very short period of time during which to spend the cash because, of course, the money has to be spent by March 31. We’re looking at spending several tens of millions of dollars on a daily basis between now and the end of the fiscal year.
The other thing I’ll put on the table is this is actually the first estimates document in which you’ll see an appropriation for the Office of the Parliamentary Budget Officer. We actually appear within the Supplementary Estimates (C), requesting approximately $730,000 as well. That’s something I’d be happy to go into a bit more detail on with respect to why we’re requesting the money and how we’d propose to spend it within a relatively short period of time.
Last, but not least, I want to touch on something in the last testimony that hasn’t been highlighted — and is taking things up to 30,000 feet — which is looking at the content and the efforts by the government to ensure better alignment or congruence between the budget and the estimates document.
As most members around the table are aware, the government has established this as a key priority, ensuring the financial documentation furnished to parliamentarians and committees is more sensible and more comprehensible, both from a financial perspective and, more importantly, from an operational perspective. This is to ensure when parliamentarians are voting on specific items, they have a clear understanding of the connection between the money they’re being asked to vote upon and the expected results that are going to be achieved.
I think the bottom line for us in looking through Supplementary Estimates (C) is the government’s efforts are very much a work in progress at this point. So looking at the roughly 95 specific initiatives contained within Budget 2017, we were able to track about 70 of them going through Supplementary Estimates (A), (B) and (C) so far this year. That leaves about another 25 items we were not able to identify within the supplementary estimates over the previous year.
This ends up being important given the aspirational goal — those are the words of the President of the Treasury Board, not my own — of ensuring that 100 per cent of the Budget 2018 items actually appear within the Main Estimates themselves.
All that said, there does seem to be some progress, albeit a bit of a gap, but there continues to be room for improvement. I know within the Office of the Parliamentary Budget Officer, we’ll be the watching this with great detail, both to see whether the government is actually on track to achieve their goals but more importantly whether, even after they achieve those goals, it renders the financial information you need to make decisions more comprehensible and more meaningful.
With that, I’ll hand it back over to you, Mr. Chair.
The Chair: Thank you.
Senator Marshall: Thank you very much. I wanted to focus on the social affairs section and specifically your comments relating to the Department of National Defence, because they have just testified.
Last year, we had talked about their new defence policy, the Strong, Secure, Engaged, and there was no money budgeted last year. And I notice this year the Parliamentary Budget Officer is talking about how they’re going to ramp up spending over, I think, the next nine years and there is going to be a substantial ramp-up of $14 billion. But when you look in the budget, you can’t find anything, or I couldn’t find anything.
I know the verbiage is there about the $18 billion to the $32 billion, but the PBO gets into talking about looking for detailed information. Can you just talk about where you got those numbers and the expectation of whether you would see it in the budget or not? Because I couldn’t find it in the budget.
You could probably just throw in this thing about the fiscal framework. I always thought the budget was part of the fiscal framework but now I’m wondering after the testimony if that’s correct.
Could you just elaborate a bit on the section that you have on National Defence?
Mr. Jacques: Sure. With respect to the numbers, within the graphics we’re actually using numbers from the National Defence document, Strong, Secure, Engaged, which was published in June 2017. That ends up being the numerator and then, of course, on the denominator side we are using our own forecast with respect to direct program expenses going out over the medium term.
What I will say, with respect to the clarity regarding what National Defence has actually budgeted vis-à-vis what’s in the fiscal framework and what’s going to be spent, that’s something we’re also very interested in.
That’s why we’ve filed multiple information requests with the Department of National Defence. They have committed to hopefully get back to us by March 9 with details around Strong, Secure, Engaged because, I think as you and other members are aware, the budget amounts from National Defence are very much a moving target.
We have a snapshot from June 2017, but since that time there has been movement, for instance, with respect to the government’s announcement of the potential purchase of the F-18s from Australia. It wasn’t contained in the document in 2017 but is something the government is moving on at this point.
With respect to your point around the fiscal framework, I think your understanding of the fiscal framework is bang-on to the extent that if it’s in the budget document tabled yesterday, it is the fiscal framework for all intents and purposes. Something we’ve noted in the past and I noted in a meeting with defence officials yesterday is there is no line for National Defence in that document.
Senator Marshall: That’s right.
Mr. Jacques: So when you actually go back to the summary tables with respect to expenses, National Defence ends up being rolled up in terms of overall operating expenses.
One of the key things we’re focused on is reconciling what was in Strong, Secure, Engaged, the Department of National Defence document in June 2017, versus what the government actually has, as of the budget yesterday, within their overall fiscal framework.
It’s not to say the two are not completely congruent, but the point I made to Defence officials yesterday would be the knowledge there is effectively only one organization that manages and controls the fiscal framework, and that’s the Department of Finance.
To the extent the Department of Finance is not publishing an updated medium-term framework regarding how much money has explicitly set aside in the budget, if I was sitting in National Defence, let alone any department, it might give me pause or concern that I couldn’t point to the government’s predominant or pre-eminent fiscal document and identify my medium-term spending path and reconcile that back to my actual operational plans.
Senator Marshall: That’s very helpful. Thank you.
For the $435 million that’s in Supplementary Estimates (C) for National Defence, I was asking for the detailed breakdown. I’m not quite sure from the testimony I received, because I went back and asked a supplementary question.
As the Parliamentary Budget Officer, do you get details of what’s in that $435 million? It looks like a lot of money. They say it’s operating, and it’s in vote 1C, but surely there must be a more detailed breakdown than that available. Do you have access to that?
Mr. Jacques: Sadly, or potentially optimistically, the information we have access to is the same body of information to which you have access. There are some exceptional situations where National Defence or other government departments will share confidential information with us. This is not one of those situations, which is why we filed the information request with National Defence specifically to reconcile what is in Supplementary Estimates (C) back to Strong, Secure, Engaged — the snapshot from June 2017 — and figure out what is new and whether it’s consistent as set out as part of the plan.
That said, to give credit to the Treasury Board and National Defence, there are supplementary tables that are online, some of which I do find helpful. They have a detailed breakdown of something they call “by standard object.” If you go online, you can download spreadsheets that tell you how much is to be spent on personnel versus professional services, utilities and other types of expenses. That’s something we go to quite quickly.
Senator Marshall: Would that be available to me?
Mr. Jacques: Absolutely, yes.
Senator Marshall: I spent a lot of time last week on the government’s website and in the open portal, trying to find detailed information. All I could find was really high-level information.
What you’re talking about — as you roll down, it’s available?
Mr. Jacques: I only sat in on the second half of your discussion. In terms of the additional detail that’s online, it certainly wouldn’t answer all of your questions, but within our office, our starting point is to go through all the detailed information. At the very least, even if it doesn’t answer your questions, it allows us to ask more intelligible questions.
Yesterday, when I was meeting with DND officials, I had gone through that information in detail, only knowing there are far more of them than there are of me and they know far more about their budget than I possibly do. But at the very least, if I’ve gone through an exhaustive search of every detail they have online, even if they don’t have an answer, I’m able to pin them down with respect to the specific questions.
Senator Marshall: I’m not asking you to divulge information, but would you have seen the detailed breakdown for that $435 million in the Supplementary Estimates (C)?
Mr. Jacques: On this one in particular, we would not have much more information than you do at this point in terms of the actual linkage back to Strong, Secure, Engaged. From a policy perspective, we’re very much relying upon the explanation of requirements within the Supplementary Estimates (C) document or the estimates documents, which I think I could diplomatically describe as being “uneven” in terms of the level of detail furnished to the public regarding what the monies are.
Senator Marshall: But the government has got the information, haven’t they? They would have to. It starts at the bottom and rolls up.
Mr. Jacques: Absolutely. I spent the first 15 years of my career working in the Department of Finance, Treasury Board Secretariat and the Privy Council Office before I jumped to work at the PBO for the past 10 years. I can confidently say there is no random number that shows up in an estimates document. There are thousands of officials going through and preparing these numbers in excruciating detail. I’ve made this observation to other committees in the past: There is a reason when officials appear at the table, their briefing binders are much thicker than your briefing binders. That’s not to denigrate the contribution made by the good analysts on the committee.
Senator Marshall: My last question is this: Does the Parliamentary Budget Officer have access to the details the government is producing for their own benefit, right down to the lower levels? Is that what’s accessed by the PBO?
Mr. Jacques: We definitely have more access. We have direct access to the government’s accounting system. On a monthly basis, we receive a large data dump of all of the accounting and — you can certainly appreciate this — all the monthly trial balance data for each department and agency reconciled back to what was actually budgeted.
I will observe, though, that looking at the financial transactions provides some insight. That said, in terms of the linkage back to policies, it becomes a bit more tenuous — then actually linking it to results — again the government appropriates money to achieve policy outcomes. There is a bit of a gulf on that front.
That is the reason why I will go over and meet with Defence officials, because I can figure out if they’re asking for 435, I can figure out how much is related to personnel and professional services. I kind of have a sense of how it relates to Strong, Secure, Engaged, but in terms of asking the question, “Is it really 435? Do you think it’s going to be under? Do you think it’s going to be over? How much risk did you take into account? How did you calculate the numbers? What are the sensitivities around those?” That’s information that can only be furnished by sitting down with the department officials.
Senator Marshall: The data I’m talking about is there. I don’t have it but it’s there. Thank you.
Senator Pratte: I would like to pursue this line of questions. You have an interesting table in your report that shows how defence funding will increase as a percentage of program expenses over the next five years. Of course, the amounts with the new defence policy are quite impressive.
Has the PBO decided to give particular attention over the next few years to defence spending? Has there been any decision to look into that over the next few years, considering the amounts that will be spent?
Mr. Jacques: In terms of decisions around what to monitor and what to analyze, it’s primarily on the basis of what we call risk and materiality. Starting with the second first, materiality is to ask if it’s big. In a $300-billion budget, is it a substantial amount of funding? The answer in the case of National Defence is “absolutely.” You’re looking at $20 billion per year.
On the topic of risk, that’s something that ends up being more subjective in nature. In an area where the government is ramping up significant amounts of spending and there ends up being a risk they’re not going to achieve their specific targets, either flowing funding out the door or to complete a procurement in time. Going back to previous Auditor General reports, you can also see where the government has had problems achieving targets. We’ll focus on those areas. In the case of National Defence, we look at the ramp-up in spending, which ticks the second box. Defence is something we’re paying very close attention to.
Senator Pratte: I’m asking because I’m thinking about the focus you’ve put in recent years on the infrastructure programs, which has been extremely useful for us. All the questions Senator Marshall asked are indications of how uneasy we are in front of those huge numbers and the difficulty we have in getting information. We’re very early in this new policy, and the amounts are huge. I don’t think it’s normal we as parliamentarians will have to sit in front of our computers on the Defence website trying to understand what’s going on. Even you, with the resources and time you have, have difficulty getting information.
The PBO and maybe the Auditor General have to find a way to get this information and to get it as early as possible, so we’re able to follow what’s going on. The amounts that will be spent and the impacts of the amounts on both procurement and Canada’s defence policy will be huge.
Mr. Jacques: Absolutely. For us, it was part of the motivation in sending in the additional information request to National Defence. The plan right now with Strong, Secure, Engaged is every six months, we’ve asked National Defence for an update with respect to their current spending. As well, as part of our budgetary requests for the coming fiscal year, we’re planning on adding some additional capacity on the defence side to build out our own models, so hopefully we can turn things around more quickly.
I would suggest — and I don’t know whether it’s feasible for the committee — but coming out of multiple discussions I’ve had with Defence officials, as I mentioned, they do share confidential information with us, which in the past, they have not necessarily shared with the committee. Defence officials certainly have a very good grasp on their own budget and the financial pressures they face. It might help if there were a mechanism whereby the committee could have an in-camera or confidential session with Defence officials.
I know from my own experience the meetings I have with them discussing confidential data are incredibly useful. While I do have more time and am paid to do it on a full-time basis, it’s challenging to go through the National Defence website, or the website of the Congressional Budget Office, or the Government of Australia to triangulate and piece things together. However, sitting down with the officials in the room and actually asking them questions while they have spreadsheets at their disposal and they can explain “here is this public figure” and “this is how we calculated the public figure” is very useful.
I’ve suggested to them on multiple occasions in the past they might want to be proactive in that regard. However, were the committee to invite them and create that space where they could provide a confidential briefing, I think you might find that informative.
Senator Pratte: I have one point. This is a rookie senator question. I’ve been here two years, but I’m still surprised by how this process goes. We have, for instance, National Defence. I know they have this new policy, and so on, and a $15-billion budget, but they came here requesting over $700 million on February 15 and the end of the fiscal year is March 31. I’m still overwhelmed by that. Is this normal?
Mr. Jacques: Yes, it is normal. Having been around the block both on the inside — that is, having put together Supplementary Estimates (C) when I was working in the executive branch — and also being on the outside now working for the Parliamentary Budget Officer, it is a bit of a high-risk endeavour, primarily because there isn’t a lot of time to spend the money.
I think in 2015-16 the government came in requesting $923 million in Supplementary Estimates (C). They appeared before this committee and the committee at the house, assured everyone they were going to definitely spend the cash and lo and behold they weren’t able to spend the money. There’s always that challenge when you’re dealing with a short time window as to whether it’s feasible to spend the cash within that period of time.
Taking things back to where the government is trying to go with respect to providing better congruence between the budget and the estimates, if you’re coming in at the end of the year to request this funding as part of appropriation Bill No. 5, none of this should be a surprise at this point. Reasonably speaking, the government’s fiscal plan is in the budget; everything is detailed. In this current budget, Budget 2018, when you go to the annex they have great reconciliation tables that haven’t been public in the past. They’re existed, but they haven’t been published. If the government is coming in at the end of the fiscal year, nothing should be a surprise at this point for anyone. It certainly shouldn’t raise questions in the minds of members around this table, or in either house, whether it’s feasible to actually spend the money at this point in time.
Senator Pratte: Thank you very much.
Senator Eaton: Mr. Jacques, to follow on with everyone, as you’ve spent a little time with the defence department, can you tell, looking at their figures, whether they are on track with their shipbuilding schedule by the amount of payments that have been given out or not given out?
Mr. Jacques: That is precisely the reason why we’ve asked for this information from National Defence. To give the government full credit in Strong, Secure and Engaged, it is a level of transparency, especially project by project, we have not seen before.
There are two interests. The first is from a fiscal framework perspective, that is, ensuring there is alignment between what’s in the budget versus what National Defence says it needs to spend. The second component is, if you can actually identify movement. If in June 2017 they said the profile for spending for the national shipbuilding strategy was going to be such over a 10 to 15-year period and then six months later, those numbers end up changing ever so slightly, from a financial perspective it starts the line of questions, why are those numbers and why is the spending delayed?
Senator Eaton: Or not moving.
Mr. Jacques: Precisely, or whether they’re still on track. That’s the specific reason why we asked for the updated financial information.
Senator Eaton: Thank you. You mentioned the used CF-18s they’re buying from Australia. Where would I find that? Would that be in the budget coming on April 1? Would it be in the mains? Do you know?
Mr. Jacques: I think the government has yet to actually sign an agreement with the Australians. Were they to do that, then I presume we would see it. It’s probably late for Supplementary Estimates (A). They would be in the fall, so we might see something in the fall.
Senator Eaton: All right. One more question. According to some research I was given, you found that a quarter of all Budget 2017 measures did not make it into the estimates. Do you know how that compares with previous years? Is that an anomaly? Is that a usual thing? What are the reasons for the delays? Is it the same departments over and over again?
Mr. Jacques: I don’t think we’ve actually tracked things on a department-by-department basis over a multi-year period of time, although it is a good question. Actually, I’ll go back and take a look at that.
It isn’t out of the ordinary. That’s one of the reasons for the commitment made by the government to incorporate 100 per cent in all budget items in the subsequent estimates. In this situation the Budget was tabled yesterday, the Main Estimates are going to be on April 16 and the aspirational commitment is to incorporate all items. That’s why that commitment really struck us as being a very aggressive commitment and potentially not necessarily realistic.
Senator Eaton: So this time next year I’ll be able to ask you whether all items have been included in 2018?
Mr. Jacques: No, on April 16, at around 5 clock in the afternoon, assuming the Main Estimates are tabled sometime in the morning. My colleague and myself will look at the Main Estimates, lock ourselves in a room, eat pizza and do a reconciliation of Budget 2018 where, hopefully later in afternoon, we can happily tell you the government has met their commitment of incorporating all Budget 2018 items in the next estimates document.
Senator Eaton: Thank you very much.
[Translation]
Senator Forest: This is all very interesting. I’m still very much a rookie. I tend to take a macro view of the file, having drawn up budgets for so many years on a much smaller scale. Don’t you think the budget method we use here, with Main Estimates in April, followed by Supplementary Estimates (A), (B) and (C) — although at least one of those is apparently going to be eliminated next year — creates a kind of laissez-faire culture? Even if the Main Estimates aren’t as specific as I would like, I can ask for budgetary estimates in Supplementary Estimates (A), (B) and (C). So I don’t quite understand the manager, because it’s like there are no expectations. It’s like we’re making the budget this way: you spend, you request funding, and if you don’t have enough, you request some more.
At the end of the line, there’s the Treasury Board, of course, but when you look at our budget… I’m explaining this badly. Let me take a simple example, just $125 million. Earlier, in its Supplementary Estimates (C), the RCMP asked us for $125 million to hold a long-planned event, the G7 Summit, but the end of the fiscal year is six weeks away. What I’m having a hard time understanding is why, when they were making their budget, they didn’t think to include the G7 Summit that’s going to be held in Charlevoix in 2018 in their Main Estimates and think about how the needs are going to be assessed. I was previously told that the RCMP would need a total of about $250 million. Here we are six weeks from the end of fiscal year 2017-18, and they’re asking for 50 per cent of that total in Supplementary Estimates (C). But they didn’t request anything sooner. Those expenditures weren’t included in the Main Estimates, nor in Supplementary Estimates (A) or (B). This request just popped up. All of a sudden, they need $125 million to spend in the next six weeks.
I feel like this budget process leads to a management style that is — I don’t want to say “lax,” but I can’t think of any other word — and a sort of loose approach to budget forecasting. There are no stated expectations for budget forecasts. For instance, we could say that, in drawing up the budget for your statutory and operating expenses this year, setting aside extraordinary expenses like the G7 Summit, we expect you to stick to a maximum increase of 1.8 per cent. As far as I know, there are no stated expectations with regard to the most important public budget in Canada, the Government of Canada’s budget.
[English]
Mr. Jacques: For myself, I would also not necessarily use the word “lax.” What I would say is that at a macro level, I think your observations end up being well-founded. If you are expressing frustration with respect to the congruence around the budget process —
[Translation]
Senator Forest: My astonishment.
[English]
Mr. Jacques: It’s a similar type of astonishment observed by parliamentarians for a very long period of time. Sadly, these issues are still flagged today.
What I will say, to give the government some credit, is there are some moves in a more positive direction.
For instance, if you look at Budget 2018, for the first time, they actually have detailed summary tables in the back telling you how much money they plan to come in and ask for as part of the estimates process, and they delineate that by department.
They also link it to specific types of initiatives. For instance, were you to turn back the clock to Budget 2017, if the money for the G7 conference was actually earmarked in Budget 2017 and if they had the same disclosures they had this year, one would expect to see in the back of the budget that amount of money earmarked for specific departments.
Now, where things do fall down — and information they do have internally that they need to manage the approvals process — is the delineation of timelines. So even though they will have Budget 2018 and they know how much money they’re going to come in as part of the estimates process by department and agency, they won’t necessarily tell you when. So apart from the aspirational commitment, there’s no indication whether it’s in the Main Estimates, Supplementary Estimates (A) or Supplementary Estimates (B). Nor is there any indication with respect to the results they actually expect to achieve. There ends up being a significant cleavage between what’s actually in the budget on the spending side on the departmental plans documents, the detailed documents every department and agency will be tabling on April 16 with the Main Estimates.
All that said, being someone who has been around budgeting for far too long at this point, I apologize we haven’t made better progress over my past 25-year career. But the observations you’re making are very similar observations that parliamentarians have made in the past. While there are some tepid improvements, I’d make an observation I’ve made to other committees. If you’re surprised or you don’t like the material or you don’t understand it, it’s not you. It’s not you and it’s not your problem.
The government produces the estimates documents to substantiate the financial request that they make to Parliament and they produce them for you. And if you cannot understand them or if they’re not meeting your needs, then that’s their problem; that’s not your problem.
[Translation]
Senator Forest: We were speaking earlier about infrastructure. That’s the main initiative the government proposed to Canadians for jump-starting the Canadian economy. One component — the smaller component — is being undertaken in partnership with the territories, provinces and municipalities. The larger component and the investments are being done within our departments and agencies. This is not an operating budget. It’s on a permanent basis. It’s a 10-year plan. It’s impossible to figure out what funding is being allocated, in order to track the spending. Yet jump-starting the economy is really the government’s main initiative, since it’s putting $100 billion on the table. We can’t track this, and it’s been exactly two years.
I want to know about the pace of investment. How close is each department to reaching the objectives? Even going through the websites doesn’t give me a breakdown of the impact of this tool, which was the government’s key initiative for jump-starting the economy.
[English]
Mr. Jacques: Hopefully at the end of next month we will be publishing an updated report with respect to the Budget 2016 infrastructure spending. We had very similar challenges in actually tracking spending going through the official government documentation and the websites. We sent out information requests to about 30 departments and agencies and now we’re just finalizing the data set. We’ll have an update on that topic. The way in which the data is organized does make it challenging on occasion, but it does provide a certain degree of job security for myself.
[Translation]
Senator Forest: Updated with respect to 2016.
Mr. Jacques: Yes.
Senator Forest: But it’s 2018 now.
[English]
Mr. Jacques: We are starting with the 2016 spending amounts and so we’ll have a snapshot as of December 2017 to what extent the money has rolled out around various projects in detail across the country. So we’ll have a database that we can, of course, share with the committee. And I would note in the budget tabled yesterday, the government did note there was roughly $2.6 billion they said they were going to be spending in 2017-18 that they had to push off to future years.
The Chair: Senator Eaton has a comment and we will conclude with Senator Andreychuk.
Senator Eaton: I just want to say that, as a committee, we’re also trying very hard to find out the accountability of some programs, i.e., X number of dollars one year, the following year, did it work, how many people, is it worth it? And so we’re trying to push that one, an evaluation of money spent.
The Chair: Honourable senators, there will be a vote at 4:04. Therefore, the last questions will be from Senator Andreychuk.
Senator Andreychuk: I’ll try to make it short. Following up on what Senator Forest said, most parliamentarians don’t have the skills to look through estimates and budgets, et cetera. That’s one problem.
The other is we want to know the programs. We want to know the policies, and we want to know how much it’s going to cost. That’s basically the same.
The documents are difficult for us to read, but there are two problems. One is how the bureaucracy produces, and I certainly have been an insider, like you have. Towards the end of the year, you can move your money around to make sure it got spent. I recall one prime minister said some years back if you are encouraged to be efficient and you have money left, you will be able to roll it over to use, which then I think was a more effective use of money.
There have been minor changes to improve the system and to make people more accountable and responsible. But it’s still a complex system. The Auditor General said the information we get on websites is really for the department to put its best face on itself rather than user-friendly and consumer oriented. That’s the other problem.
What’s troubling me today is that I rely on Senator Marshall.
I thought she could read all of the figures. Now she’s telling me she hasn’t got them; now I’m really worried.
Is there any attempt to do it program by program that we can look at it? Senator Stewart used to sit here years ago and say we’re not doing our job well because each committee should be scrutinizing the budgets of their particular area. In other words, Foreign Affairs should be scrutinizing that. We would then do what Parliament was intended to do some 100 years ago.
There’s a lot of fault to go around is what I’m saying. How do we make it today when everyone wants instant information? That we get the things we need to reply back to the constituents who ask us: How much does that program cost? When will it be implemented? Those are things we want to be reassured are happening on the financial and program sides.
Mr. Jacques: I shouldn’t disagree with a senator, but I will in this situation. If there is a problem, the blame quite squarely lies at the feet of the federal public service. They’re the ones producing these documents, and it certainly does not lie with members of the upper house or the lower house. They produce these documents for you. They’re very well paid to do it. If you cannot understand the information, they need to be directed to produce more meaningful and useful information.
The other observation I’d make — and again going back to a point that Senator Forest made — there was a House of Commons study in 2012 produced by the Government Operations Committee specifically looking at renewal of the estimates process. One of the key recommendations was moving to a voting structure whereby you would vote on programs as opposed to input. As opposed to operating, capital, grants and contributions, you’d vote on programs. As part of the President of the Treasury Board’s efforts to improve the transparency of the budget and the estimates, he committed to run a pilot project, which he’s done with Transport Canada.
I had the opportunity about a week and a half ago now to watch him testify before the Government Operations Committee, where he indicated that that pilot program, from the internal government perspective, had gone quite well. There were no hiccups and no issues on the part of the department.
If there is one thing that you were going to do around the committee table, or as parliamentarians, if there is one thing you could press on that would dramatically improve your understanding and your ability to perform scrutiny as well as conveying or communicating that to the public, it would be shifting the voting structure from those inputs to a program basis. If for no other reason than it always resonates far more with people, instead of talking about Fisheries and Oceans vote 1, you’re talking about the Canadian Coast Guard. Instead of talking about $1.2 billion, you’re having a conversation about, well, in the North Atlantic in December, when there are people out there fishing, what percentage of the time will you save those people? How much money will be given to the Coast Guard? How many ships will they actually have in terms of search and rescue? What capacity is in place? And how many people do you expect not to save within an hour based on the money provided?
That’s very concrete for people. More important, it sets up a manner of accountability which is far more reasonable.
From a parliamentary perspective, it’s an unreasonable expectation someone will go through and say, “Well, you’ve asked for $453 million. Should it be $452 million? Or $454 million?” The better conversation to have, from a parliamentary perspective, is: Great, you want $453 million. What do we get for it? Six months from now, what are you going to achieve? When I invite you back to testify before the committee, what do you expect to tell me 12 months from now as to what that is going to look like?
We need to be voting on that basis. You have, effectively, a contract with the public service and with government departments. You’re no longer saying, “Here’s $1.2 billion. Shift it around.” The end of the year comes, maybe you don’t spend on the Coast Guard. Maybe you decide you need to spend on new chairs for the folks downtown in Ottawa. You can’t do that; right? The money is voted for the Coast Guard. You know that’s where the money is going. Most important, it’s actually tied to concrete results. You know if you’re giving this amount of money to the Coast Guard, the level of commitment the government makes with respect to service levels is X. So 5 per cent of the time in the North Atlantic in December when there’s a poor fisher person out there on the high seas, they will not be saved within one or two hours. That’s how much money is available.
If you focus on that, if there’s one thing you do over the next 12 months, and you’re able to accomplish that —
Senator Andreychuk: That would make sense to me, and there’s only one qualifier, which is timing. We do have other committees. Getting papers at a late date is the other thing — estimates, as we were talking about — but a program would make sense to any parliamentarian.
Senator Marshall: We were talking about the data and how it rolls up by department, and departments keep that information. I would think that Treasury Board and the Privy Council Office have access to that, but do they have their own data sets or is there just one set of data?
Mr. Jacques: In terms of the accounting or financial data, we’re all, for the most part, working with the same data set. What I will say is the data can be organized differently. For instance, we have access to a direct feed — it’s like drinking through a firehose — of data from the accounting system which is very disorganized, which we then have to go through —
Senator Marshall: Stratify it or whatever.
Mr. Jacques: This is it. Whereas, in the government, they start with organized data.
Senator Marshall: They are filling in the data.
Mr. Jacques: Yes. There is a difference. But from a financial perspective, certainly with respect to the accounting data, and to a lesser extent with respect to some of the costing data, we’re all pretty much working from the same data sets.
The Chair: To the PBO, we are not astonished; we’re not surprised. You have been very informative. You have provided clarity, and you have been very enlightening. We will continue working together.
(The committee adjourned.)