Proceedings of the Standing Senate Committee on
National Finance
Issue No. 60 - Evidence - February 28, 2018 (evening meeting)
OTTAWA, Wednesday, February 28, 2018
The Standing Senate Committee on National Finance met this day at 6:45 p. m., in public, to continue its study on the Supplementary Estimates (C) for the fiscal year ending March 31, 2018, and in camera, to consider a draft agenda (future work) and a draft budget.
Senator Percy Mockler (Chair) in the chair.
[Translation]
The Chair: Honourable senators, welcome to this meeting of the Standing Senate Committee on National Finance. I am Senator Percy Mockler from New Brunswick and the chair of this committee.
[English]
I wish to welcome all of those who are with us in the room and viewers across the country who may be watching on television or online. As a reminder to those watching, committee hearings are open to the public and also available online at sen.canada.ca. I will now have the senators introduces themselves.
[Translation]
Senator Pratte: André Pratte from Quebec.
Senator Forest: Éric Forest from the Gulf region of Quebec.
[English]
Senator Marshall: Elizabeth Marshall, Newfoundland and Labrador.
Senator Eaton: Nicky Eaton, Ontario.
[Translation]
The Chair: I would like to recognize the presence of the clerk of the committee, Gaëtane Lemay, and of our two analysts, Sylvain Fleury and Alex Smith, who help us in our work.
[English]
This evening, honourable senators, we continue our consideration of the expenditures set out in Supplementary Estimates (C) for the fiscal year ending March 31, 2018.
In the first hour, we have before us officials from Global Affairs Canada to discuss their requests for funding included in the supplementary estimates. We have Mr. Arun Thangaraj, Assistant Deputy Minister and Chief Financial Officer; and Shirley Carruthers, Director General, Financial Resource Planning and Management Bureau.
[Translation]
The clerk has informed me that Mr. Thangaraj will make a presentation, which will be followed by a period for questions. With that, Mr. Thangaraj, the floor is yours.
[English]
Arun Thangaraj, Assistant Deputy Minister and Chief Financial Officer, Global Affairs Canada: Thank you very much. Good evening, senators. It is a pleasure to be here before you. I will have a couple of brief opening remarks and then be pleased to answer your questions.
The estimates that you see before you in the additional funding that we’re requesting is requested for the purpose of allowing Canada to continue to lead and demonstrate to Canadians and the world that our values and actions can make a real contribution to fostering global peace and prosperity. Supporting a stable, predictable international order in our national interests, in fact, building a more peaceful and secure world, will form a central theme that will frame the G7 agenda during Canada’s 2018 presidency.
An example of the department’s work in this area can be seen through the results of our Peace and Stabilization Operations program. We have partnered with the Organization for Security and Co-operation in Europe to support the Government of Ukraine and other partners to resolve the conflict in the Ukraine and have bolstered women participating in UN-led negotiations supporting mediation and peace building in the Middle East.
Further, Canada is working with the United Nations and interested member states to advance the recently announced “Elsie Initiative” which seeks to deploy additional uniformed women as military and police peacekeepers and overcome the barriers to women’s meaningful participation in peace operations.
These initiatives are shaped by Canada’s Feminist International Assistance Policy which has allowed a refocusing of our global development and humanitarian efforts on advancing gender equal and the rights and empowerment of women and girls.
Since its implementation in June 2017, $650 million in funding has been committed to support and sexual and reproductive rights initiatives, which includes comprehensive sexuality education, family planning, prevention and response to sexual and gender-based violence, safe and legal abortion and post-abortion care.
[Translation]
We are committed to measuring our performance and communicating our results to Canadians. To increase the transparency of Canada’s international assistance, beginning in 2018, we will publicly report the planned level of the international assistance envelope on an annual basis.
Global Affairs Canada continues to emphasize responsible financial management to deliver its mandate. Through these supplementary estimates, $202.5 million has been requested to supplement our international assistance envelope funding. This additional funding, allocated to the department through Budget 2017, will, in addition to responding to emergencies, respond to increasing demands on our international assistance envelope funding. It will also allow the department to further deliver on Canada’s feminist international assistance policy and support the government’s commitments to gender equality.
[English]
The department has requested an increase of $423.3 million, which will bring its total authorities to date to $6.6 billion.
Global Affairs Canada has requested $31 million for this fiscal year to prepare for hosting this year’s G7 summit in Charlevoix, Quebec. To support the Canadian presidency of the G7 this year, Global Affairs Canada, as the lead department, will coordinate, develop, support and advise on G7 policy, and manage the overall operations, including financial management. The leadership role at the summit presents Canada with the opportunity to pursue strategic objectives, including those within Canada’s Feminist International Assistance Policy, the Progressive Trade Agenda, and the Pan-Canadian Framework on Clean Growth and Climate Change.
Through these supplementary estimates, Global Affairs Canada has requested $169.7 million for this fiscal year to continue to deliver on the Prime Minister’s commitment to invest $2.65 billion to global climate change action by 2020-21.
[Translation]
This year’s funding will support phase II of the Canada Climate Change Program and the Canadian Climate Fund for the Private Sector in the Americas. These projects build on Canada’s expertise in providing financial support for developing countries to reduce their greenhouse gas emissions and increase their climate resilience and adaptive capacity. Some of the successes we have seen from the first phases of these initiatives include the provision of financing to support construction of a hydropower plant in Nepal to address the energy shortages in the region and the construction and operation of the first utility-scale solar power project in Panama. From these initiatives we are already seeing a marked decline in carbon dioxide emissions, as well as increased savings for small and medium enterprises that can now rely on renewable energy sources.
[English]
As announced by the Prime Minister in November, Canada will play a lead role in increasing the participation of women in peace operations. Building on studies that demonstrate the strong link between women’s involvement in peace operations and the achievement of long-term, sustainable peace, the Women in Peace Operations funding aims at providing assistance and incentives to increase the proportion of women deployed in UN peace operations.
Global Affairs Canada is accessing $7 million through these supplementary estimates to begin developing this initiative, part of a total $85.7 million to be allocated to the department over the next five years.
Also, as part of Canada’s leadership role on global peace and security, Global Affairs is requesting access to $12.5 million of renewed funding to fulfill Canada’s financial obligation to Organization for Security and Co-operation in Europe.
[Translation]
This funding will support Canada’s role in addressing major conflicts and crises around the world as well as advancing our foreign policy objectives with respect to democracy, human rights, good governance, conventional arms control, and security cooperation.
The department will continue to collaborate where appropriate, with other federal entities and provincial, territorial and municipal governments, and engage constructively with a diversity of Canadian and international stakeholders.
[English]
We will also ensure the high standards of service to Canadians, particularly those requiring consular assistance abroad.
We understand the unique role that Canada has to play in the global arena, knowing we are safer and more prosperous when more of the world shares Canadian values. At Global Affairs Canada, we are committed to furthering this agenda through all we do around the world, from headquarters to our embassies and consulates, and through our leadership roles in multilateral fora.
Thank you, Mr. Chair, and I look forward to answering your questions.
The Chair: Thank you. Before we go to questions, Mr. Thangaraj, if I look at the French version of the vote you are asking us to consider, in part of the page in French, you’re asking for $205.5 million. When I look at the section of the English version of your speaking notes, you say on page 2 that you are requesting consideration for $202.5 million.
Can you tell us why there is a discrepancy?
Mr. Thangaraj: I would like to say it’s my commission for doing the estimates, but it’s a typo in the remarks. The amount is $202.5 million.
The Chair: Thank you. We’ll proceed to questions.
Senator Marshall: Thank you very much for being here this evening.
Could you start off by giving us some information about the $202 million? The explanation is fairly generic. Is that specifically targeted for certain organizations? Can you give us a breakdown?
Mr. Thangaraj: Sure. Budget 2017 allocated the department an additional $202.5 million to further the ability to respond to the Feminist International Assistance Policy. This increase allows us to develop programs with the World Food Program to address the most vulnerable population typically in sub-Saharan Africa; provide food assist for those populations and those vulnerable groups, specifically targeted to women; to look at food-insecure communities and finding ways for them to be more resilient and immune against supply shocks.
We’re also allocating this money to respond to humanitarian crises that exist globally. Additionally, for example, there is an amount of about $5 million for UN AIDS programs. We work with the United Nations program there to ensure that we consistently reduce the number of individuals affected with HIV/AIDS, provide greater access to treatment and care, and reduce barriers that exist for certain populations that confront that disease.
Senator Marshall: Do you have a list of that? The funding for each of those areas you just went through — are there amounts designated for each of those areas? Do you have a list?
Mr. Thangaraj: In anticipation of this budget increase, we had highlighted a number of partners, for example, the World Food Program and UN AIDS, to whom we would either increase our support or provide additional funding. We can provide a list of organizations we are supporting for this money.
Senator Marshall: And the amount they will receive?
Mr. Thangaraj: Yes.
Senator Marshall: This is something you do on a recurring basis. Some of these organizations have received funding in the past, I would think, so how do you make sure the funding goes — we’ve talked about this in previous years — how do you ensure it gets to where it is supposed to get?
Mr. Thangaraj: That work begins up front in the project design. In the selection of partners, we look at the type of issue, whether it’s food resiliency, as I spoke about with the World Food Program, or a climate change program. We look at the partner and the geographic area. In the project design, we look at the internal controls in place, such as how the money flows into a local organization.
We do the upfront due diligence to ensure that, in the project design, all the fiduciary requirements are embedded. One example is monitoring, oversight and the frequency of audits. We ask for those audit reports. Prior to any funding we do through contribution agreements, we ask for detailed budgets, as well.
Our projects are typically over five years, so we fund in increments; we don’t fund everything up front. We provide, for example, six months’ or one year’s worth of funding and we get detailed reports prior to funding.
Senator Marshall: And then you go into the next phase, okay.
Mr. Thangaraj: Part of that upfront due diligence is looking at the partner’s capacity to monitor. We’re looking at their internal audit function, procurement policies, internal controls and their audits. So throughout the project life cycle, our staff in the finance function and the development officers work very closely together with the partners to ensure that we act on findings for audit reports.
At the end of project life cycle, two things happen. One is that we do project evaluations, so we build in results reporting. Are we getting value for money? The other thing we do is recipient to audit. Over the course of the agreement, we look at whether the recipient has complied with the terms and conditions of the contribution agreement. We try to do this in a way to ensure that money goes to its intended recipient but we’re not overloading partners, as well. We have a long history of doing this.
Senator Marshall: You make sure it goes where it’s supposed to and then that it yields results?
Mr. Thangaraj: If you think of humanitarian situations, for example, in Middle East refugee camps in Jordan or Syria, there is only a specific number of partners who have the ability and on-the-ground logistics to ensure food or other types of assistance actually gets to the people in need. That specific intervention in humanitarian aid is driven by the assurance that the partner can provide the money or that the assistance gets to the intended recipient.
Senator Marshall: Who decides what areas? You talked about the sub-Saharan region and then about Syria and Jordan. Who decides what countries and who decides what projects and what amount?
Mr. Thangaraj: Those allocation decisions really flow from the Feminist International Assistance Policy, where we said our priority will be the poorest and most vulnerable.
For example, when we are looking at what countries are the poorest and most vulnerable, we look at income indices and fragility indices of those countries to decide where we ought to be intervening. We look at what other partners are doing with multilaterals and other donors and interventions where we know we can make the biggest difference and we’re not duplicating efforts of other organizations.
One of the things we have tried to do and done well with the donor community over the last 10 years is work collaboratively. It strengthens our oversight to know what everyone else is doing. They share audit findings with us and we do with them. The partners we work with and the areas where we intervene are driven by the policy in terms of a focus on sub-Saharan Africa and the poorest and most vulnerable and in the areas focusing very much on women and girls.
We have a very robust tracking mechanism internally to ask whether this program is generating the results and targeting women and girls.
Senator Marshall: Syria, right now, has quite a few challenges and a lot of media coverage. Is that something that we would fund? I would imagine it would be very challenging to get resources into that country now.
Mr. Thangaraj: That is correct. Where there is fragility or instability in an environment like that, that is typically where we work with the UN or other multilateral organizations where you have a lot of donors contributing and it’s not just Canada. It’s a joint effort of different donors funding an organization to ensure that we get the results so that the people who are in camps for the internationally displaced have access to education, health care, sanitation and things like that.
Senator Marshall: So where the media is reporting that women have been forced to provide sex in exchange for food, are these things we are aware of?
Mr. Thangaraj: That’s correct.
Senator Marshall: And we would be focused on that?
Mr. Thangaraj: Absolutely. In unfortunate incidents like that, we work with the organization. We often sit on their boards of governors and ensure up front that our agreements build in the expected standards of conduct that respect Canadian values and the rights of vulnerable people. And so when incidents like that happen, the institution, in collaboration with those who support it, act quickly to resolve those situations.
Senator Pratte: Good evening. I would ask a couple of questions about the global climate change action initiative. I noticed that you mentioned a couple of initiatives and stated that you have already been seeing a marked decline in carbon dioxide emissions linked to these projects, which is quite interesting.
If this committee wanted to follow the results of the initiative, not only specific projects, but as a whole as the money is divested and so on, is there a way to do this? Do we just go on the Global Affairs Canada website and see the initiative and the decline in GHG emissions? Is that how it goes? Or do we have to ask you to send in the information?
Mr. Thangaraj: The examples that I was citing are project-specific. For example, in the funding requested through the Supplementary Estimates (C), we work through multilateral development banks who make these loans, they do the reporting on our behalf and we collate that.
I don’t believe it’s on our website. I can confirm that and how we report that out. In general, we do reporting on this initiative, but for specific projects if you made that request we can provide you a list of the projects we are funding and the results.
Senator Pratte: I should know this, I’m sorry, but I didn’t have time to check. When the global climate change action initiative was launched, was there a specific GHG emissions reduction objective? There probably was.
Mr. Thangaraj: I would have to confirm that.
Senator Pratte: I’ll check on that. It’s all right. Is there a monitoring system so that we make sure that, at the end, there is an objective that has been met or not?
Mr. Thangaraj: We work with our colleagues in Environment Canada on the reporting of this, and we monitor and track the upfront objectives of the $2.65 billion.
Senator Pratte: I would appreciate if you would report back to the committee.
Mr. Thangaraj: I will report back.
Senator Pratte: I have a question about the G7 summit. We’ve had other government agencies or departments who came before us who are also involved and are also requesting sums of money for their part in the organization of the summit.
You do mention that Global Affairs Canada is the lead department. I was wondering whether that involved simply a foreign policy aspect of the summit or whether that also involves a financial aspect. Are you the lead department to make sure that the budget involved is controlled and no one is spending more? Is that Treasury Board?
Mr. Thangaraj: That’s correct. We are the lead department and the coordinating department, so in the supplementary estimates you will see funds allocated to the RCMP, for example, who were here this afternoon. The overall budget is coordinated by the G7 Sherpa, who is a deputy minister, and so the spending and monitoring of that is done and coordinated through Global Affairs Canada.
Senator Pratte: We know, from what other organizations have told us, that the amount that is asked in Supplementary Estimates (C) is the first tranche of money and that there will be a second tranche, I suppose, in the Main Estimates or maybe in next year’s supplementary estimates. Can we presume that this will be your case also?
Mr. Thangaraj: That’s correct. The full amount will appear in the Main Estimates.
Senator Pratte: It will appear in the Main Estimates.
Mr. Thangaraj: That’s correct.
Senator Eaton: Mr. Thangaraj, perhaps you could help me a bit here. I noticed the $202 million to support international assistance priorities, and you were very generous with your remarks to Senator Marshall about sub-Saharan Africa and the Middle East. You didn’t mention the Rohingya, but maybe that’s not on your horizon right now. What’s different from when you came last year to talk about aid programs to these very vulnerable populations now with this new Feminist International Assistance Policy? Is that just lovely trendy words of the budget or is there a change in the way you will deliver?
When I read some background information about that, I also think that with some populations, they have different cultural and religious practices. I wonder about a big economically rich, highly educated society coming in and talking about the new feminist international assistance; it might be a bit patronizing or a bit pushy.
Mr. Thangaraj: Some of that is outside my area of expertise. For the Rohingya, which was an emerging humanitarian issue last year, in response the government allocated about $38 million for that, working through other donors in the United Nations and with our Bangladesh program, looking at how we deal with displaced persons.
Senator Eaton: They’re on your horizon? They’re part of your priorities?
Mr. Thangaraj: Yes, in international development, because of the level of fragility and instability, you have to be responsive. We do a lot of forward planning; it’s good financial practice. But in that financial management, you have to build flexibility to be able to respond and reallocate to areas of need.
Senator Eaton: The second part of my question was that I think we’ve always done that, and you have always done that and the department has always done that, but how has this new Feminist International Assistance Policy changed the programs we’ve been doing, assistance programs for the last years?
Mr. Thangaraj: It’s a new lens through which we look at development programming. For example, we want to make sure that women and girls are integrated into program design.
Senator Eaton: Sorry, you will have to explain what that means.
Mr. Thangaraj: For example, if I was to take —
Senator Eaton: Just give me an example of a program.
Mr. Thangaraj: A vaccination program. I would want to make sure that the program is designed in such a way for the access to vaccines. For example, there are cultural barriers, as you have said, for people to access vaccines. In certain cultures, having a male doctor administer the vaccine would have an impact on take-up rates.
Senator Eaton: You would have always been conscious of that.
Mr. Thangaraj: It is central to the design.
Before we design a vaccination program, education program or a water and sanitation program, we are looking at that. For example, I was in Mozambique a little while ago at a school and we were looking at the fact that we do fund educational programs there, but something as basic as access to sanitation facilities for women or girls is different. So building that component very much up front in program design is what this means. It doesn’t mean that we’ll —
Senator Eaton: You will put little boys out by the road.
Mr. Thangaraj: That’s correct.
Senator Eaton: Thank you, that explanation is very helpful.
To continue on Senator Pratte’s line of questioning about environmental funding, with the $2.65 billion, are the countries we give that to countries that could not afford to do it otherwise?
Mr. Thangaraj: Yes. So the funding that Global Affairs Canada allocates to its development program is addressing a funding gap.
Senator Eaton: We have given in the past to countries like China and Mexico, have we not?
Mr. Thangaraj: I would have to look in the past to see who the recipients of those funds are. I’ll use the example of Nepal or Sri Lanka. There are coffee crops that are impacted because of climate change to a rust virus, so we work with farmers to mitigate the impact of climate change. The notion is that absent this funding that’s provided through what we’re requesting from the supplementary estimates, these projects, whether they be solar projects or others, wouldn’t get funded.
Senator Eaton: We’re not giving them to economically advanced countries like China and Mexico.
Mr. Thangaraj: That’s not the intention; I’d have to confirm that. When we work with partners, such as the Asian Development Bank, they will list a list of recipients of those funds. A lot of the time, our funds are targeted for developing countries. They may have other funds where projects would be funded for those, but I would have to go back and confirm that.
Senator Eaton: Thank you very much. That was interesting.
[Translation]
Senator Forest: Thank you for being here this evening. In your remarks, you indicated that, in 2018, the government intends to measure your results and to account for them. That seems to me to be the proper thing to do and I congratulate you for it. Can you tell me which measureable indicators you are going to use in order to be able to conduct an objective assessment of the targets attained because of the international investments?
[English]
Mr. Thangaraj: For every development project we have, we establish results for those specific programs in terms of development outcomes. For example, with vaccination, the easiest indicator is the rate of vaccination, how many people. But we move down a value chain to look at longer term results.
One thing the department did this year, which you will see in our departmental plan, is that we have a brand new departmental results framework where every individual project has a results framework that rolls up into the results we expect to achieve for every program.
Those results used project monitoring, so a project officer says here are the results we expect for this and then they monitor, work with the project. Is there an adjustment required? What is going on? And then it’s used in the evaluations, so we feed that back and if we are doing a similar type of intervention, we take the lessons learned from the results frameworks into account.
[Translation]
Senator Forest: You will agree that there are two ways of proceeding. You can look at the results of a project, any project. So you say that X million dollars were invested in a vaccination campaign to treat a disease, for example. The other way, which you do beforehand, is to clearly identify the objectives with measurable indicators. You invest $5 million in a project, for a vaccination campaign, for example, and your target is to administer 10 million doses of vaccine. At the end of the project, if you have administered 8 million, you have reached 80 per cent of the target. If you have administered 12 million, you have reached 120 per cent of the target.
Do you determine the targets to be reached before the project starts, or do you just indicate that $10 million were invested in the vaccination campaign and that the result is that 8 million doses of vaccine were administered?
As I see it, if you really want to have measurable indicators and accountability, you have to set measurable objectives for yourself at the beginning of the project and then record the results you have obtained.
[English]
Mr. Thangaraj: At the beginning of every project, we establish those results. We create an accountability mechanism for that with our agreement with the partner, and we monitor those results, sometimes on a quarterly basis with them, and at least annually. But for every project in the project design we have those results up front. It’s not post facto, it’s very much up front.
[Translation]
Senator Forest: So you can already measure how effective your investments have been. But, in your efforts to measure your results and be accountable for them, you are going to make the results public in 2018.
[English]
Mr. Thangaraj: The results we have are part of our departmental results, so you will see the high-level result. But every project has results available for it.
[Translation]
Senator Forest: I would like to know the difference between the efforts at accountability you are planning to make starting in 2018 in comparison to those in 2017. How will your accountability look any different? If it does not, you will be telling me that you are going to continue measuring the results, which you are already doing. Next year, when we meet again, I should be able to tell you that I see the difference in your accountability methods, because I will have been told about the objectives and the results.
[English]
Mr. Thangaraj: That would be in our departmental plan. So what we are hoping to achieve that’s incremental and different we will set out in our departmental plan. That’s, again, the vehicle by which we roll up the project results and say here is, for this program, whether it’s humanitarian assistance or the environment, the result that we’re hoping to achieve or the incremental progress towards a target. So that’s where you will see that set out.
[Translation]
Senator Forest: Perhaps it would be easier for you to send the clerk the method by which you are going to measure your starting objectives, so that you can then be accountable for them.
One global phenomenon that is very serious in some countries is the prevalence of tuberculosis, malaria and AIDS. AIDS in particular is a major issue. However, tuberculosis currently causes more deaths than AIDS. Is your department targeting its involvement to countries that are in the grips of tuberculosis?
[English]
Mr. Thangaraj: I don’t have the details specifically on tuberculosis, but one of the organizations that we work very closely with is the Global Fund to Fight AIDS, Tuberculosis and Malaria. They look at the incidence of all three diseases, and all three diseases present themselves in different ways and in different populations. For example, tuberculosis often manifests itself in vulnerable populations, for example, in prisons. So the interventions that the Global Fund uses to address that vary. For example, with malaria, they use prophylactic bed nets. For AIDS, it’s antiretroviral therapies. But tuberculosis is emphasized within their programming, and a lot of the health partners that we work with, the multilateral ones, do focus on tuberculosis because, as you said, the incidence of that disease is increasing.
[Translation]
Senator Forest: Currently, the epidemic killing the most people around the world is tuberculosis. When you have the information—
[English]
Mr. Thangaraj: We can provide you with specific information on what we’re doing for tuberculosis.
Senator Marshall: Going back to the international assistance priorities, are we providing any assistance to Venezuela?
Mr. Thangaraj: I don’t believe we are, but I would have to confirm that. I know we don’t have a —
Senator Marshall: You can get back to us on that.
I have a question more related to the way you’re budgeting as opposed to your programs. That’s the transfer to the Department of Public Works and Government Services for the International Civil Aviation Organization headquarters building in Montreal. What I wanted to know is: There’s $12 million being transferred out for operating and $2 million for capital. Were those amounts budgeted in your department precisely for that?
Mr. Thangaraj: That is correct.
Senator Marshall: It was?
Mr. Thangaraj: Yes.
Senator Marshall: Why is it being transferred out? What happened?
Mr. Thangaraj: This is more of a simplification of a financial transfer. The building was leased. It was a purpose-built space for the International Civil Aviation Organization, and, in our reference levels, we had money to pay the lease, payment in lieu of taxes, as well as an amount for the capital. Global Affairs had the money. But we couldn’t pay directly, so we had to transfer the money to Public Works, who would pay it. Essentially, what this does is normalize and put the money in the organization that was —
Senator Marshall: Would we see something like that now in the next year?
Mr. Thangaraj: No, this is permanent. You will see this transfer in this supplementary estimates, and then it will be adjusted in our Main Estimates. So this will be an ongoing reallocation to the Department of Public Works.
Senator Marshall: When a department transfers money to another department for something, it always has to be for that specific purpose?
Mr. Thangaraj: That’s correct.
Senator Marshall: You just can’t say, “Okay, they have savings over there. Let’s just move them over here.”
Mr. Thangaraj: I would be making phone calls all day if we could.
Senator Marshall: Okay. Thanks. That’s helpful. I learned something new.
Senator Eaton: Mr. Thangaraj is going to continue my education. The $12 million funding for the Organization for Security and Cooperation in Europe, is that the Ukraine?
Mr. Thangaraj: So the Organization for Security and Cooperation in Europe is a multilateral organization that really fosters what its title says, security —
Senator Eaton: Is it NATO? Is it funding of NATO?
Mr. Thangaraj: It’s a specific organization. Every year, like multilateral organizations, there is an assessed contribution. So this is our assessed contribution for the organization.
Senator Eaton: What do they do for us for our $12 million?
Mr. Thangaraj: They advocate for us in terms of, in Europe, enhanced security cooperation between Canada, European countries. For example, in Ukraine they were very much involved in election and oversight and those kinds of things.
Senator Eaton: If you have a moment, do you think you could just send us a little note? Then I won’t have to ask the same question next year.
Mr. Thangaraj: Absolutely.
Senator Eaton: Thank you.
[Translation]
Senator Forest: I need a piece of information. I have a question about the votes totalling $202.5 million. How will you manage to spend $202.5 million? We are six weeks before the end of the financial year. How are you going to go about it?
[English]
Mr. Thangaraj: This is the magic of working in international development. It’s cash management. So we know that this money was allocated to the organization in Budget 2017. So we started planning for potential expenditures. We’ve negotiated agreements. So, essentially what we’re waiting for is really to sign the agreement with the organizations.
In certain cases, we know what our expenditures are, so, if an organization had an expenditure in June, we would have paid for that and delayed other ones. So essentially we’ve been cash managing this amount since the announcement.
[Translation]
Senator Forest: New agreements?
[English]
Mr. Thangaraj: Yes.
The Chair: There is one question; I was told that you have the answer on this one.
Mr. Thangaraj: That is a lot of pressure, Mr. Chair.
The Chair: We’ll switch to the G7 summit. Can you inform the committee what the total budget will be for all of the departments to support the G7 summit of 2018, keeping in mind Budget 2017-18 and what you’re looking for, 2018 and 2019, to have a total cost of the G7 summit?
Mr. Thangaraj: As outlined yesterday in the budget speech, the total amount of funding for the G7 is $604.5 million.
The Chair: Can you then distribute who will be responsible for what within the government apparatus?
Mr. Thangaraj: Yes. For example, in these supplementary estimates, Treasury Board Secretariat publishes horizontal items, and they will list in the supplementary estimates, for example, for the G7, which is a horizontal item, all of the departments that are requesting funds for that. Similarly, for the Main Estimates, there will be an enumeration of all of those horizontal items for this amount.
The Chair: Could you provide the clerk with that information, please?
Mr. Thangaraj: Yes.
The Chair: Could you also provide the committee with that amount, $604 million, what percentage of that and where physical assets will be constructed?
Mr. Thangaraj: I would have to go back to look at the spending plans for the organization to look at physical assets.
The Chair: When will you provide that to us, sir?
Mr. Thangaraj: We should have that fairly quickly, within the next week.
The Chair: My last question, as a former minister of international affairs for a province, but it’s very similar with the federal government, can we have funds that are not utilized by the end of March of the year, which would be the end of March 2018? Could we have a transfer of funds to those organizations that will only be targeted for their operations starting April 1, 2018 to March 31, 2019 — that is, internationally?
Mr. Thangaraj: If I understand your question, it is can I use “unspent” funds?
The Chair: Yes, you can use that word.
Mr. Thangaraj: That is a tricky question for us. On our grants and contributions budget, anything we do not spend by March 31 is lapsed. We cannot carry forward those expenditures for the next fiscal years to use for other purposes. For operating vote, we are allowed to carry up to 5 per cent, given our budget it is about $78, $80 million, around that number.
Senator Marshall: You can’t reprofile it and spend it?
Mr. Thangaraj: We can reprofile it under certain circumstances. For example, if there is a significant capital project and we assume it would be spent in a specific disbursement pattern — and again, with large capital projects that profile doesn’t normally materialize — we would do the reprofile as opposed to carrying forward. A carry forward is usually a result of operations. Yes, we can carry forward up to 5 per cent.
Internally, we have a list of priorities that we will fund against those. If there are emerging needs or pressures, we will do that. Part of it is we do plan and use our carry forward as contingency measures as well.
The Chair: Thank you. To conclude before we go in camera, Senator Andreychuk.
Senator Andreychuk: First, I apologize; it was not the plan. I’m sure you breathed a sigh of relief because I do have a number of questions, but one I’m still struggling with is separation of management of humanitarian money within the department and assistance work. It’s still impossible to figure it out. This is about the third year I’ve asked for that. We need to know whether we are doing legitimate development work over here and legitimate humanitarian assistance here. We need to know that breakdown.
I follow the department closely, as you know. That’s why I was late. I was dealing with an issue. It’s important for the NGOs because they keep saying development is dropping and I can’t rebut whether or not they it is. I see global figures all over the place, but I cannot tell legitimately within because your development assistance sometimes goes to humanitarian assistance. I need a clear picture so that we can really explain to the Canadian public where our money is really going.
Mr. Thangaraj: Internally, there is a clear delineation as to what will count as humanitarian and what will count as development assistance. Technically, it all falls under the same umbrella as official development assistance. We use coding provided by the OECD. They give us the coding convention. For every project we have we will code it, there is a specific code and the project has to meet specific requirements for it to be coded for humanitarian apart from development.
One of the things we spoke about with Supplementary Estimates (B) is the use of the crisis pool. Given that, as we I said earlier, when we look at the countries in the environment that we’re programming, it is far more fragile and we are seeing more rapid on-site crises like the Rohingya. The crisis pool allows us a stable and predictable pot of money from which to fund that so we don’t have to dip into development resources or ongoing development work. The notion of not having to do that was contemplated in setting up the crisis pool.
I can provide an explanatory note about how we do this, how we code it and how we track humanitarian and other programming decisions.
Senator Andreychuk: That would be one more step in understanding it but I’m back to your question, though. It’s still very much a judgment call and which crisis counts, what is development, and where. I think it’s an ongoing concern that we need to address as a country.
Mr. Thangaraj: I think even for the development practitioners — and I’m not one — they would say a lot of things that start off as a humanitarian crisis are more prolonged than they used to be. We contemplate humanitarian aid as something that is as a result of natural disaster and a lot are manmade. There is fragility in different aspects, so “humanitarian” tends to be a lot more prolonged. That’s part of the challenge.
With respect to the judgment call, the criteria are very specific in terms of how we track. We have a reporting obligation to the OECD. Internally, one of the functions that we provide with that coding is we report financially to the OECD and publicly. We ensure that the same financial rigour over that coding is applied as I would in the Public Accounts. Anything that we report — and a lot of that reporting, admittedly, is retrospective — I assure you meets the “humanitarian” definition.
One thing we are working on is how we can enhance the transparency of our spending. NGOs have said that as part of the international assistance review in 2016. That is something we did here and something, as a department, we are actively working on.
Senator Andreychuk: To be continued, thank you.
The Chair: With that, senators, we will say thank you to Global Affairs Canada for providing information on our questions. We will now suspend to go in camera.
(The committee continued in camera.)