Proceedings of the Standing Senate Committee on
National Finance
Issue No. 68 - Evidence - May 29, 2018 (afternoon meeting)
OTTAWA, Tuesday, May 29, 2018
The Standing Senate Committee on National Finance met this day at 1:30 p.m. to study the Main Estimates for the fiscal year ending March 31, 2019.
Senator Percy Mockler (Chair) in the chair.
[English]
The Chair: My name is Percy Mockler, Senator from New Brunswick and chair of the committee. I wish to welcome those in the room and who may be watching on television or online.
[Translation]
I would like to remind our audience that the committee meeting is public and accessible online at sen.parl.gc.ca.
[English]
Now, I would like to ask the senators to introduce themselves, please, starting on my left.
Senator Cools: I am Senator Anne Cools from Toronto, Ontario.
Senator Marshall: Elizabeth Marshall, Newfoundland and Labrador.
[Translation]
Senator Moncion: Lucie Moncion from Ontario.
[English]
The Chair: I would like to recognize the clerk of the committee, Ms. Gaëtane Lemay, and our two analysts, Alex Smith and Shaowei Pu, who support the work of this committee.
Colleagues and members of the viewing public, the mandate of this committee is to examine matters relating to federal estimates generally, as well as government finance.
[Translation]
Today, our committee is continuing its study on the Main Estimates for the fiscal year ending March 31, 2019.
[English]
This afternoon we will hear from two departments that we invited to talk about their requests for funding for the current fiscal year. First, from Transport Canada, we welcome Karen Cahill, Director General, Financial Planning and Resource Management.
[Translation]
We are also hearing from Pierre-Marc Mongeau, Assistant Deputy Minister, Programs.
[English]
We also welcome Ms. Lori MacDonald, Assistant Deputy Minister, Safety and Security.
From Veterans Affairs Canada, we have Sherry Spence, Director, Financial Operations, Chief Financial Officer and Corporate Services; and also Maureen Sinnott, Director General, Finance and Deputy Chief Financial Officer, Chief Financial Officer and Corporate Services.
Joining us by video conference from Charlottetown, P.E.I., is Ms. Faith McIntyre, Director General, Policy and Research Division, Strategic Policy and Commemoration.
On behalf of the Standing Senate Committee on National Finance, welcome to the meeting and thank you also for accepting our invitation to share your opinions, comments and vision.
Each department has opening remarks. We will begin with Ms. Cahill from Transport Canada, followed by Veterans Affairs, Ms. Spence.
[Translation]
Ms. Cahill, go ahead.
Karen Cahill, Director General, Financial Planning and Resource Management, Transport Canada: Thank you, Mr. Chair, for the invitation to meet with the committee on behalf of Transport Canada. I am happy to be here to talk to you about Transport Canada’s Main Estimates for 2018-19. I’m joined by Pierre-Marc Mongeau, Assistant Deputy Minister, Programs, and Lori MacDonald, Assistant Deputy Minister, Safety and Security at Transport Canada.
[English]
The funding outlined in the Main Estimates would support Transport Canada in its efforts to continue to provide a transportation system in Canada that is safe, secure, efficient and environmentally responsible.
Through these estimates Transport Canada is seeking to access a total of $1.5 billion, including $697 million for operating expenditures, $123 million for capital expenditures, $471 million for grants and contributions, and $224 million for statutory authorities.
This represents an increase of $212 million, or 16 per cent, from our 2017-18 Main Estimates. This is largely attributed to the new funding for the Oceans Protection Plan and Trade and Transportation Corridors Initiative, which were both announced last year in Budget 2017.
The Oceans Protection Plan is the largest investment ever made to protect Canada’s coasts and waterways, and these estimates include $98 million towards the plan in 2018-19. This amount includes $59 million in operating expenses and $37 million in grants and contributions funding.
[Translation]
The Trade and Transportation Corridors Initiative will provide infrastructure investments for stronger, more efficient transportation corridors across the country. We are seeking $119 million for the initiative in 2018-19. Of this amount, $99 million will go towards grants and contributions supporting the National Trade Corridors Fund.
This year, Budget 2018 provided $60 million to Transport Canada in 2018-19, including a provision of $26 million for the protection of marine life, targeted to protect, preserve and recover endangered whale species in Canada.
[English]
The funding for Budget 2018 for Transport Canada is not included in our Main Estimates but has been included by Treasury Board Secretariat through its Main Estimates and will be accessed by Transport Canada through the budget implementation vote.
I am also pleased to note that starting in fiscal year 2018, Transport Canada will begin reporting information based on our new departmental results framework.
Through the departmental results framework, we will clearly indicate what results we want to achieve, what results have been achieved, and what resources were used to achieve these results.
For Transport Canada, the departmental results framework comprises three core responsibilities, nine results on which the department reports publicly, as well as a program inventory.
[Translation]
Mr. Chair, the financial resources sought through these Main Estimates would help ensure that our transportation system continues to serve Canadians’ needs — to move goods and people to where they need to go, safely and securely, for years to come.
My colleagues and I would now be happy to answer any questions you may have.
The Chair: Thank you.
Sherry Spence, Director, Financial Operations, Chief Financial Officer and Corporate Services, Veterans Affairs Canada: Good morning, Mr. Chair and committee members. It is a pleasure to be here with you, and I look forward to discussing the Veterans Affairs 2018-19 Main Estimates submission.
My name is Sherry Spence, and I am the Director of Financial Operations at Veterans Affairs Canada. I’m joined by Maureen Sinnott, Director General of the Finance Division. Also joining me by videoconference from Charlottetown is Faith McIntyre, Director General of the Policy and Research Division.
Our department is charged with providing veterans with the respect, support, care and economic opportunities they deserve. This includes providing them with new career opportunities when they leave military service, making it easier for them to access services and doing more to support their families.
I am pleased to say that Veterans Affairs Canada’s 2018-19 Main Estimates reflect the steps we have taken to date to ensure that Canadian veterans and their families are treated with care, compassion and respect.
I will now summarize the contents of our Main Estimates submission.
First, it is important to understand that our department’s budget fluctuates each year because of the demand-driven nature of its programs and services. Veterans Affairs Canada updates its client and expenditure forecasts each year to ensure that all veterans who come forward receive the benefits to which they are entitled.
[English]
VAC’s total Main Estimates submission for 2018-19 is $4.4 billion, a net decrease of $297 million in comparison to last year’s Main Estimates.
The decrease in funding is primarily attributable to funding in the previous year relating to Budget 2016, which saw an increase in the Disability Award. In that year, a one-time retroactive payment was made in 2017-18 to all veterans who received an award since the introduction of the New Veterans Charter in 2006.
If this one-time funding was removed from consideration, the department’s budget would actually have increased this year. This is primarily attributable to an increase in the number of Canadian Armed Forces veterans and their families benefiting from VAC’s programs. At the same time, the number of war service veterans is declining.
These Main Estimates include multiple new programs, including a caregiver recognition benefit, an education and training benefit, the Veteran and Family Well-Being Fund, the Veterans Emergency Fund and the Centre of Excellence on PTSD and Other Related Mental Health Conditions.
Veterans Affairs Main Estimates also include funding to enhance career transition services, eliminate vocational rehabilitation time limits for veterans’ spouses and survivors, and to expand access to the Military Family Resource Centres for medically released veterans’ families.
These initiatives were announced in Budget 2017 and are intended to help veterans transition from military life to civilian life; better support the families of ill and injured veterans, including caregivers; and invest in mental health services and care for veterans at risk.
With regard to existing programs, Veterans Affairs Canada continues to see increased funding requirements for programs utilized by Canadian Armed Forces veterans and their families. For example, as I said previously, excluding the one-time retroactive payments, Disability Award funding has increased by over $150 million over last year’s estimates, while the earnings loss benefits has increased by $96 million. This program ensures those undergoing rehabilitation have the financial support they need during their recovery.
Conversely, some of the department’s programs do not require as much funding as they have in previous years. For instance, funding for disability pensions is decreasing by $59 million in comparison to last year’s Main Estimates. This is due to the fact that the number of war service veterans and their families is declining.
As you know, commemoration of all those who served is an important part of Veterans Affairs’ mandate to ensure that we, as a nation, never forget the dedication and sacrifice of those who served. The Veterans Affairs Commemorative Partnership Program exists to pay tribute to the sacrifices and achievements of those who served in Canada’s military efforts. As a result, these estimates include funding to commemorate the hundredth anniversary of the end of World War I, along with the last 100 days; the seventy-fifth anniversary of D-Day and Battle of the Atlantic; the sixty-fifth anniversary of Korean War; and the tenth anniversary of national peacekeepers. Commemoration funding will also be used for the Funeral and Burial Program and grave maintenance.
As in past years, over 90 per cent of the department’s budget in these Main Estimates continues to represent payments to or on behalf of veterans, their families and other program recipients. During 2018-19, the department will continue to focus on the well-being of veterans and their families, promote service excellence, and recognize veterans services and sacrifices.
In closing, I would like to state that supporting the care and well-being of veterans and their dependents through a range of benefits, services, research, partnerships and advocacy is one of our overarching goals. With the help of the funding in the 2018-19 Main Estimates, the department will be able to fulfill its promises.
Thank you, Mr. Chair, and, when it’s time, Maureen, Faith and I will be happy to answer any questions that you or other committee members may have.
The Chair: Thank you, Ms. Spence.
Senator Marshall: Thank you for being here today. I will start off with questions directed to Transport Canada. I wanted to talk about the grants and contributions. I know that there was a pilot in the last few years, and Treasury Board has been updating us regarding the pilot, but reading the note in the estimates it seems this is now going to be made permanent.
Is it going to be made permanent, and was there an evaluation of the pilot?
Ms. Cahill: Thank you for the question. We are in the third year of the pilot. It is still a pilot. TBS has not indicated whether or not we will make it permanent.
Let me state that Parliament votes on the votes. Therefore, Parliament will decide how many votes will eventually be under grants and contributions or if the pilot should become more official.
As far as Transport Canada, we have participated. We continue to participate, and we will continue until a decision is rendered. We monitor the vote. We report on the vote, and we manage the vote.
Senator Marshall: Okay. You have worked with this now for a number of years. What would your recommendation be?
Ms. Cahill: Before we can make a recommendation, more information would be required. The pilot for grants and contributions was decided based on the complexity of our grants and contribution programs, whereas our complexity was not as high as other departments. As well, we don’t have programs that cross between votes and that’s why we were selected.
Our recommendation, before we can say to continue or not, we would need to see the parameters continuing. This was a pilot. It was done on grants and contributions, and if it was to expand, we would need more information.
Senator Marshall: Thank you very much. But I do see under grants and contributions that there is an increase — I think around $100 million — and it looks to be the grant for the National Trade Corridors Fund. So what would that be?
[Translation]
Pierre-Marc Mongeau, Assistant Deputy Minister, Programs, Transport Canada: Thank you for the question. Mr. Chair, the National Trade Corridors Fund was created last year. We are talking about $2 billion over 11 years with an objective to facilitate access to the north and help reduce bottlenecks in order to transport goods and passengers throughout Canada.
We are currently in the first year of the fund. We have called for proposals to assess the interest of businesses or governments. The call was open to all levels of government: federal, provincial, municipal and territorial. We have received more than 350 applications this year. We will begin by funding some of them. We are currently making the announcements. We anticipate that between 30 and 40 projects will be announced this year.
The objective is to continue to implement projects over the coming years to help us accelerate the process in terms of congestion in major arteries, such as ports, but also to ensure that this is being done through innovation and green government. So there are a number of projects and many years remaining for that element. This is a new initiative that was created last year and is now part of our portfolio.
[English]
Senator Marshall: Will that be funding infrastructure?
[Translation]
Mr. Mongeau: We mainly wanted to ensure that municipalities, other departments, agencies or private businesses could identify in their portfolio or their infrastructure what the issues were and what support they could obtain from the Government of Canada. For example, the Port of Vancouver knows what the limits of its current infrastructure are. They have proposed some projects that would help them accelerate decongestion.
Those are not all projects selected for this first stage because the requested amounts were huge, but we are continuing to focus on the next stages.
Mr. Chair, these are infrastructure projects with a goal to improve transportation and trade flow in Canada.
[English]
Senator Marshall: Thank you.
I was looking at your results report and your departmental plan. The results are posted there for 2016-17. When would we see the results for 2017-18?
Ms. Cahill: The results for 2017-18 will be tabled in the fall through our departmental results report. Financial information will be published also in the fall through Public Accounts.
Senator Marshall: Will there be any interim reporting on results, or will we have to wait?
Ms. Cahill: Those two official reports, yes.
Senator Marshall: Some of the items I was looking at, for example, marine security — it says percentage of industry indicating confidence in the Canadian marine security transportation system. Is that done through a survey? I notice that your target is 80 per cent, and for the last three years, it’s 80 per cent. It looks odd. How do you determine that? Is it by survey?
Lori MacDonald, Assistant Deputy Minister, Safety and Security, Transport Canada: Thank you for the question. We look at a number of factors when looking at how we identify what matrix we want them to meet in terms of the percentage. We work with industry to actually identify that. It does change year by year, depending on what they’re identifying to us in terms of that matrix and what our expectations are of them.
Senator Marshall: Is that the actual results there? The 80 per cent — was that done by survey? How independent are those ratings? Does that come from third parties?
Ms. MacDonald: Yes. We actually have an oversight program where we measure a number of factors they’ve identified. Part of that oversight program is to see how they have been compliant with certain areas from a marine security perspective, but we receive information directly from industry as well.
Senator Marshall: So, it’s not all survey. It would be your own independent assessment.
Ms. MacDonald: That’s right.
Senator Marshall: Another one was the transportation marketplace framework. It looks like, rather than improving, it’s getting worse. What do you do in a case like that? This one is competitive transportation sector rail passenger transportation intensity, and it started out as 0.61 but now it’s going down to 0.54, which is below your target. What do you do in a case like that?
Ms. MacDonald: Unfortunately, that doesn’t fall under my area in terms of monitoring, but I will give you my overview in terms of that piece.
It’s the same thing. We measure and monitor activities that are happening in that particular area and work with the industry, or the railway in that case, to determine what we see with respect to the metrics they’re giving us and what our expectation was in terms of what was identified in the first place.
Senator Marshall: Is there an independent assessment done on what you report? As you were speaking, I was thinking about the Canada Revenue Agency and their telephone system, and how they were reporting that they were doing great until the Auditor General went in and said they weren’t. Is this something all done internally, or is there an independent assessment?
Ms. MacDonald: We have a few different mechanisms. The Auditor General would be one mechanism, as an example, that could look at that. We also have our own internal audits we do. Transport Canada audits a number of programs such as this.
Senator Marshall: Would they audit performance?
Ms. MacDonald: Yes, and evaluations, as well — that does that kind of auditing.
[Translation]
Senator Pratte: My questions are for the Transport Canada representatives, first regarding the pilot project. When I look at the French version —
[English]
— grants and contributions are separated. In French, it says:
[Translation]
“réseau de transport efficace, réseau de transport écologique et novateur, réseau de transport sûr et sécuritaire”.
[English]
So it’s separated into three different bowls. That’s what the pilot project is all about, right?
[Translation]
Ms. Cahill: Yes.
Senator Pratte: If I understand correctly, that could not be made more granular because it would become impossible.
Ms. Cahill: It becomes difficult to make it more granular when it comes to grants and contribution prograMs. What you are seeing in the Main Estimates is each grant and contribution program.
The web version of the budget now contains a link that allows us to classify each program according to the credits under which they are identified.
Senator Pratte: If I went on the website — your website?
Ms. Cahill: The Treasury Board’s website?
Senator Pratte: Could I find each of the grant and contribution programs under “efficient transportation system”?
Ms. Cahill: That’s right. The granular version you are seeing is the one presented in the Main Estimates, on page B134. That is the most granular version you can obtain for grants and contributions.
Senator Pratte: Okay. This is the third year of the project. Why can’t I make a comparison with previous years yet?
Ms. Cahill: When we look at the Main Estimates, we see the estimates for 2017-18 and 2018-19. No amount appears for 2017-18 because there was no allocation for this grant or contribution program in the Main Estimates 2017-18. However, if you look between the two years, you will see that amounts have been earmarked for each of the contribution programs.
Senator Pratte: The largest amount goes to the Oceans Protection Plan. Does this plan include the wrecked vessels program? It is included in that. So, of the $98 million for the 2018-19 plan, how much is spent on wrecked vessels?
Mr. Mongeau: From memory, the target is about $7 million a year. There are two stages. First, people will apply. They must do an analysis of the wrecked vessel to see how they could recover it and what materials are in the wreck. Second, if necessary, another submission must be made to remove it. There is a $5,000 limit for the first part, the analysis. As for the second part, it’s open, depending on the type of vessel. This is new and we are following it closely.
Senator Pratte: How do you determine which are removed first?
Mr. Mongeau: Thank you for the question. We launch a call for proposals. We open a general call for proposals with criteria. Since the program is new, many applications have been received this year. We hope that this program will continue for as long as possible.
Senator Pratte: Do they come from the areas concerned?
Mr. Mongeau: Yes. What we do is ensure that the proposals meet the criteria. Most of the time, they do. Then, the various individuals who have applied are notified as soon as their project is approved. It really depends on what the people or the municipalities are proposing.
Senator Pratte: In terms of the 2018 budget allocation, the $26 million for the protection of marine life is part of the Treasury Board central allocation. But can you tell us more about the intended use of the $26 million?
Ms. Cahill: It is part of the 2018 budget. We are preparing the program, which will be presented in due course to the Treasury Board and, later, to Parliament for funding.
Senator Pratte: Is this a new program rather than a continuation of an existing program?
Ms. Cahill: It’s a new program.
Senator Pratte: Okay. Thank you very much.
Senator Moncion: I have two supplementary questions in relation to Senator Pratte’s questions. As far as wrecked vessels are concerned, how many have to be removed? With $7 million, if you have 50 wrecks to recover, you won’t get very far.
Mr. Mongeau: We have already managed to spend some money this year. The challenge is to start the program to figure out the demand. As with any contribution or grant program, it depends on the demand and response of the public or the municipality. Where appropriate, annual budget requests may be submitted to ensure that the project continues.
Senator Moncion: Do you know how many there are?
Mr. Mongeau: It is difficult to establish the number of wrecked vessels because more keep coming. We remove one and someone else will abandon another boat. But there are probably hundreds of wrecked vessels at the moment. That’s an estimate. There are probably more. I don’t have that data with me today.
Senator Moncion: Is it true that you are only going to look for those on the surface, not the ones at the bottom?
Mr. Mongeau: It depends on the depth. Some wrecks are completely lost. Most of the time, the wrecked vessels are found in marinas or waterways and are relatively easy to recover or analyze. This is mainly at the request of the people. The more applications we get, the more the program will keep going. It is a long-term program. It is a safety issue. We want to ensure that waterways are as safe as possible.
Senator Moncion: Thank you. My second question deals specifically with the amount of $26 million for the protection of marine life. Why is this amount allocated to transportation instead of the environment?
Ms. Cahill: Actually, the project falls under Fisheries and Oceans Canada. Only a portion of the funding goes to Transport Canada. We are developing the program. It has not yet been approved by the Treasury Board. Once the program is finalized and approved, we will be able to provide more details.
Senator Moncion: Okay. You mentioned that the funding for Budget 2018 for Transport Canada is not included in the Main Estimates but has been included by Treasury Board through its Main Estimates and will be accessed by Transport Canada through the budget implementation vote. Can you explain that?
Ms. Cahill: As we know, $7 billion is allocated in the 2018-19 budget. In annex 2.11 of the budget plan, all the initiatives are organized by department. Transport Canada initiatives are identified and envelopes were voted in the Treasury Board Secretariat Main Estimates under Vote 40. Once the Treasury Board ministers approve Transport Canada’s initiatives, the money will then be transferred to the department. On the website, the Treasury Board Secretariat will post a monthly report on funds directed to departments.
Senator Moncion: Okay, thank you. My next question is for Veterans Affairs Canada. Funding for disability pensions has decreased by $59 million in comparison to last year’s Main Estimates. This is due to the fact that the number of claims made by war service veterans and their families is declining. How could it have decreased? The amount of $59 million is quite a significant decrease.
[English]
Ms. Spence: Thank you for the question. As I said in the opening remarks, there was a budget drop this fiscal year, which was really caused by a one-time bump up in funding, within the Main Estimates last fiscal year, to pay out a one-time retroactive payment to all veterans who had received a disability award since 2006. That was due to the fact that we increased the amount of the disability award, so that did make it look like there was a $297 million decrease in our budget overall, but, if you actually had taken that out of the equation, our budget would have increased by $300 million.
Senator Moncion: Okay, but these families are no longer receiving the disability amounts, or they’re just switched to another area?
Ms. Spence: Neither, actually. What happened was we paid out, last year, a top-up payment, if you want to call it that, to all of the veterans who had previously received an award.
Senator Moncion: Okay. Thank you.
Senator Eaton: I apologize for being late, but I had to do scroll.
In Budget 2018, there was $11.3 million allotted for maintaining rail services to remote communities. I was just wondering if you could give us an update on the railroad to Churchill because I think that’s been out of commission now for almost a year. I, having been to Churchill, know how dependent a remote community like Churchill is on the rail service.
[Translation]
Mr. Mongeau: For almost a year now, we have been working hard with the municipality, the province and OmniTRAX, which is not always easy, to ensure that we rebuild a rail link for the people of Churchill. We are still in the final negotiations and finalizing discussions with a number of players today. I therefore do not have a positive answer to give you, senator. I cannot tell you that the matter is completely settled, but I can tell you that it has the attention of our entire department and that we are working hard on it right now.
[English]
Senator Eaton: To continue along that line for a little bit before I get to my next question, Senator Jaffer and I sit on the Arctic Committee. We’ve heard the need for landing strips, a better port system, especially in Labrador and further up north, and I was just disappointed to see in your budget — and maybe I’m not reading it correctly — that you don’t have a lot of money allocated to corners of the North in terms of landing strips and port development, where they could have larger ships going into some of those ports.
[Translation]
Mr. Mongeau: Yes, food and service in the north are challenging. We already have an agreement with Labrador. We have committed $1 million per year to repair runways in Newfoundland and Labrador. We have had this program for a number of years and I think at least $8 million has been invested in it in recent years.
Earlier, I was talking about the new National Trade Corridors Fund. We have opened it to all the territories to ensure that all Canadians have access to it. This morning, projects have even been announced with a view to serving the north by the highway.
We are still working very hard on the Churchill project, but some airports and ports are no longer owned by Transport Canada. They were sold to the private sector a few years ago.
We have special programs under the Airport Capital Assistance Program which, through calls for proposals, enables us to financially support small airports that are not necessarily funded by Transport Canada.
[English]
Senator Eaton: Would this fall under the $10.1 billion over 11 years for transportation projects?
[Translation]
Mr. Mongeau: The $11 billion is for all phases of the call for proposals for infrastructure. We have just completed one of those phases, and some projects have been identified for the north under the initial application. Unfortunately, we are victims of our own success. We have over 350 projects, and the funding, in the first years, is limited and does not allow us to do everything. So we’re setting priorities.
Senator Eaton: You are doing things in stages?
Mr. Mongeau: Yes.
Senator Eaton: Okay.
[English]
I understand your ministry is also responsible for protecting whales in the St. Lawrence River?
[Translation]
Mr. Mongeau: In my opinion, the government’s directive is fairly clear regarding the protection of whales. We are working with various departments, particularly Fisheries and Oceans Canada, which is the leader of the program. A number of proposals have not yet received the necessary approvals as part of the process, but this is also one of our top priorities. We continue to work on it.
Senator Eaton: How are you going to combat the pollution and underwater noise generated by the boats?
Mr. Mongeau: Right now, we are considering all sorts of proposals. For example, we are thinking about how we could place special equipment underwater, not necessarily at sea, but at different access points, to see what the noise impacts are. We know that speed can also have an impact on migration, as it seems that many whales have been struck by boats.
What we are doing is known and public. We are asking boats to reduce their speed considerably. The boats have reduced their speed by almost half.
Since we do not yet have all the scientific data, we can address the problem by identifying the underwater signals that disturb whales. We can reduce the speed of vessels and we can even close some areas to navigation.
It’s very difficult to do that at the moment because it’s against the interests of fishers. So there’s nothing simple about that, because if it were very simple, there would be a lot of whales.
[English]
Ms. MacDonald: I would like to add to my colleague’s comments that we are doing a lot of work right now around developing regulations and policy with respect to noise and whales. We are looking at things such as shipbuilding and what appropriate designs should be used for ships to reduce noise.
We are also looking, as my colleague indicated, at voluntary slowdowns in that area.
We are also working with a number of partners in industry, and looking at innovative methods and discussions in terms of other mechanisms we could put in place to protect whales from the noise.
I would say it’s one of the areas where we have a high degree of energy right now, with the most appropriate methods being numerous, given how complex the problem is, to positively impact that area.
Senator Cools: I would like to welcome the witnesses before us. My question is relatively simple. I wonder if you could tell me how many war service veterans are there in Canada at the present time, and which theatres of war did they serve in, if you have that information.
Ms. Spence: I can give you the breakdown as of December 2017. Those are the last numbers I have with me. In terms of veterans in Canada, there are 127,926.
Senator Cools: That’s the total?
Ms. Spence: Yes. Of those, 21,156 are war service.
Senator Cools: Which war?
Ms. Spence: Sorry, that would be the Second World War and the Korean War.
Senator Cools: Okay, WW2.
Ms. Spence: We refer to them as traditional war service veterans. The Canadian Forces numbers are 93,573. The RCMP number is 13,197. These are all people served by VAC. We have just over 60,000 survivors so, the total clientele for Veterans Affairs right now is 188,008.
Senator Cools: Okay. When you include RCMP, were they in war service?
Ms. Spence: No — well, some of them could have been in active duty areas.
Senator Cools: Yes, some have been. I know.
Ms. Spence: Yes, correct.
Senator Cools: Thanks.
Senator Andreychuk: Thank you. I want Transport to give more clarification on airports and airport facilities. You mentioned that you are giving support to smaller airlines. What is the jurisdictional position on what are municipal airports, et cetera? I’m out of date on the designations. We constantly hear of the major airports and their difficulties, but I hear of in-and-out airports in small isolated areas. Where does your mandate end, and where does someone else’s start?
Mr. Mongeau: Thank you for the question. There are a lot of different types of airports. I don’t have my numbers here, but there are the big national airports — Pierre Elliott Trudeau, Toronto, Vancouver — we have, I think, 22 or 23 of these major airports. These are managed by a special authority, the airport authority, who is responsible. I’ll switch to French now.
[Translation]
We have 22 or 23 major airports that have to survive and find their own funding. We have retained small airports for which we have full responsibility, whereas in some regions of Canada, 15 airports or so are still managed by Transport Canada.
There is also a series of small municipal airports. A few years ago, Transport Canada transferred airports to the municipalities and provinces that wanted them, with a certain amount of money that allowed them to survive or to complete their infrastructures. Today, we have these various types of airports. As for the airports we manage, we continue to subsidize them. However for the smaller airports, there is the airport assistance program.
Each year, we issue a call for proposals and the airports submit proposals to increase their tarmac area or their runways. We go by merit, while large airports have to make sure that they are profitable, because we have no grants to give them. Airports come in several types. Transport Canada’s mandate may well be to make sure that all airports are privatized, or put in the hands of municipalities.
[English]
Senator Andreychuk: I am thinking of an accident that occurred in Saskatchewan that you’re probably aware of, and a recent report that indicated that the de-icing should have taken effect better than it had. It ended up, if the newspaper reports are right — I haven’t read the report yet — that all they had was a stepladder and a spray gun to de-ice the plane. Of course they ran into problems, and there was one death out of, I think, 22 passengers.
The question I’m being asked is: Whose responsibility is that airport? It’s very hard to find and trace small airports that are sometimes even run privately. Then some are municipal and maybe others from a provincial point of view. The point is safety, and the point is accessibility. This is crucial in winter to get these people out. Thankfully, we have now a government in the Province of Saskatchewan supplemented by STARS using helicopters to airlift any accident victims to hospitals. But just getting in and out of these communities is very difficult.
The death that occurred was a young man who was going for medical reasons, so where is the federal responsibility for the air transport? And where would I go to look for it?
Ms. MacDonald: Thank you. I would say a couple of things. Responsibility for safety and security is with Transport Canada, particularly as it relates to all modes of transportation. In this particular incident, we had responsibility for oversight in terms of looking at compliance that airport had with respect to all of the initiatives that they are required to have in place, including things like de-icing, maintenance of their runway, the equipment that they use, training that they have and so on. We provide inspection oversight to those services.
I would say with respect to the media that often when you get reporting, you only get snippets and pieces. It’s not the full reporting, but certainly in the account in this particular area, when we go in, both the Transportation Safety Board, with respect to their responsibilities, and ours in terms of doing immediate inspections following an event such as this, we take precautionary measures. We look at what kinds of problems or issues that may exist and we make determinations with respect to whether we see that air operator continuing or not in those conditions. We work with the Transportation Safety Board to take a look at what kinds of findings come out of an incident such as this.
If we find an airport that was non-compliant with respect to a particular piece of equipment, as you have identified, we can do things such as find against them from the perspective of fines and so on. We can also give them orders to put new equipment in place, new training programs and those kinds of things.
In the case of that particular accident, we worked with the airport and we put specific measures in place to ensure they have the right safety and security mechanisms in place going forward. Part of that process continues. We continue to go in and monitor them. Over the course of the past few months, we have given them some of their certifications back as part of this program and we will continue to do that. As we do with all airports like that, we have a risk-based approach with respect to oversight and compliance of their safety issues.
Senator Andreychuk: To me it’s just one example. When there is a problem, you go to Transport and try to figure out who maintains and what kind of money has gone into the Province of Saskatchewan to assist us in transportation, never mind the North, where we have some of the same problems. It’s very hard to find and pull up those figures. So no wonder that everyone else is having trouble when I have some fine minds around the table here who can’t find them.
Then, there are no comparisons year-to-year, because you seem to be shifting your process, which is always done under efficiency and updating, et cetera. But the figures don’t match up between what you did last year to this year, so I find it very difficult.
I guess my final question is: Are all of these programs that you’re setting out and the justifications you do through your department based on accountability to the minister and, therefore, to Parliament that way? Or are they based on accountability to customers? What is the focus of all of this data that you’re going to collect? In whose benefit is it?
Ms. MacDonald: Thank you for the question. There are a couple of things. Regarding the issue that we just spoke with respect to the airport, the municipality and the province are responsible for funding those. Our responsibilities are in oversight of that particular area, so our funding goes to oversight with respect to inspections, risk-based assessments, compliance enforcement, certification and those kinds of things. That’s where our money goes in terms of supporting that airport, and the airport itself looks after its own funding in terms of the equipment it buys and so on. It gets support from the municipality or the province depending on their funding mechanisms.
If I go back to the broader question with respect to our programs, obviously we’re accountable to Parliament. In terms of what we do, we are accountable to our minister. In terms of what we spend our money on and accounting back to Treasury Board with respect to what we said we were going to do and whether we did, in fact, do it, and that comes back to the point that my colleague, Ms. Cahill, made in the beginning with respect to when we report on our results in the fall period of the year. Ultimately, we are accountable to Parliament overall.
But as we go through each month of the year, we do a complete review ourselves with respect to where our budgets are at. Are they being spent on the programs the way they have been designed and appropriately to do so? We also make sure that we are doing our checks and balances in terms of those expenditures. I’ll turn it over to either of my colleagues for further comments.
[Translation]
Mr. Mongeau: Yes indeed, for the grants and contributions programs, whether for improving port facilities or for airports, we as officials are responsible and ultimately, so is the minister. We establish all the methods of monitoring the contributions provided to airports. If the grant is to buy a fire truck, we make sure that that is done and that the cost is followed through to the end of the project, in order to ensure that the project was done in accordance with what had been established.
My role is to check that the steps taken by ports and airports to improve their facilities are done according to the standards, and that the money has been well spent. They cannot change their minds in the middle of a project and do something else. If they do, we stop paying. So the responsibility lies with me to make sure that things are done appropriately.
[English]
Senator Neufeld: A lot of my questions have been asked.
Regarding the wrecked vessels or abandoned vessels, if I understood you correctly, it’s a new program. Do you take expressions of interest through the whole year, or is there a timeframe? When will you get rid of the first abandoned vessel? We got a few in British Columbia we would sure like to get rid of. I’m just wondering when you will be in there taking it away or when that decision will be made. I mean, at some point and time, I guess you have to do something. It’s not that you’re not doing anything. Don’t get me wrong.
[Translation]
Mr. Mongeau: I was about to say that it is going well. We have already begun to remove wrecked vessels. This program is new this year, but there was a call for bids, and the phases of the project have already been announced. We have started removing boats everywhere. Boats have been removed in Victoria, in Madeira Park, and in Sechelt. There are a lot of them in British Columbia, but basically, we are just starting. As we said earlier, it is $5,000 for a preliminary analysis. So that takes a certain amount of time. Then the residents decide to continue. They make a second application. If the project looks good, they will get money for the removal.
The project is under way. We will be starting our second call for bids shortly. The process goes on year-round. We are going to do it regularly, as long as the program lasts. I think that 47 contracts or analyses have already been done. The program will gain in popularity.
[English]
Senator Neufeld: I think it is a very good program. Could you send the clerk the list of those vessels that have been dealt with so far? If you would do that, please.
My second question, in your plans and priorities — clean water from transportation. It’s a number of releases of harmful pollutants in the marine environment by vessels identified by pollution, patrol and other means.
You have some results from 2014-15, 2015-16 and 2016-17 and they’re dropping by a lot, which is good, or at least your target. Can you tell me how that process works? What is a pollution patrol and other means, and how do you control it from ships? How does that all work? It’s good we’re doing that, but I want to know how it works.
Ms. MacDonald: Thank you for the question. I will talk a bit about our national aerial surveillance program, which is how we look at these issues. We have planes that we fly every day, weather permitting, with sophisticated technology built into the plane. We have pilots who are trained, as well as watchers who sit and manage the special technology that we have in these planes. They fly over our waterways and the equipment takes pictures and looks for pollutants on our water. We have a number of hours per year that we dedicate toward flying time to look for those pollutants.
When we find them we connect with other government departments, such as Fisheries and Oceans or the Coast Guard. We take data from those spills and then we connect with spill clean-up. On any given day, if we have a plane up in the air which sees a pollutant in the water, it contacts the Coast Guard or Transport Canada. They contact a local site that is responsible and trained in pollutant clean-up, and they are dispatched to that particular area to do clean-up of the pollutant.
We also collect data and we share that information with other government departments. That’s one of the reasons you will see there is a decrease with respect to what we see happening in the water.
We also do inspections of ships. We’re out constantly, as part of our oversight program, inspecting ships. We’re taking a look at what mechanisms they have to put pollution controls in place. We use things, such as administrative monetary penalties, when we find people that, for example, have broken valves or their systems aren’t compliant in the way they should be. We take action against them that way. So we have a safety program and an inspection program that are having a positive impact with respect to pollutants. In practicality, we look for it every day and we also have contracts to ensure that we do clean-up.
All of these things are having a positive impact on the amount of pollution and spills that we’re seeing in our waterways.
Senator Neufeld: Okay. So those airplanes that do the patrolling, that’s on both the West and East Coasts, and in the North?
Ms. MacDonald: Yes.
Senator Neufeld: Thank you.
The Chair: Now we will move on to second round.
Senator Marshall: My questions are for Veterans Affairs, because my previous questions had been for Transport Canada.
When you gave your opening remarks on the department’s budget and you talked about the one-time retro payment that was made to all veterans, what is the total dollar amount of the retro payments? What were they in total?
Ms. Spence: Thank you for the question. It was $621 million paid out in the 2017-18 fiscal year.
Senator Marshall: For the new initiatives in Budget 2018, the $21 million for better services for veterans, that still has to go to the Treasury Board, doesn’t it, as a proposal before you release the funding?
Ms. Spence: That is correct.
Senator Marshall: What you were envisioning there? Just very briefly.
Ms. Spence: That funding is really meant to improve service turnaround times for veterans. A lot of it will go to processing applications on a faster, more efficient basis, as well as ensuring that veterans in need have case managers and veterans service agents assigned to them to help navigate through the system.
Senator Marshall: Will most of that be used for hiring of staff? Because when you are talking about processing, it sounds like it would be a staffing increase.
Ms. Spence: Yes, that’s what it would be.
Senator Marshall: I had some questions on your 2016-17 results report and also the departmental plan.
When you look at the financial support programs where it’s saying percentage of eligible veterans whose family income is above the low income measure, the target is 90 per cent, but then it’s 94 per cent for three consecutive years. As with Transport Canada, when I see the same percentage for three years in a row, how is that determined? Is that determined internally or is there some sort of — do you have some kind of computer program that would provide that percentage? How is it determined?
Ms. Spence: Thank you for the question. We have different means of determining that type of information. Every year we conduct a Veterans Affairs Canada National Survey in which we include questions on financial well-being, and that enables us to monitor the program performance, the activities and outcomes that our programs are providing, and supports us in program evaluation.
We also have stakeholder summits every year and meetings with advisory groups, and we use their stakeholder input to help develop policy and program changes. These measures are about ensuring that veterans have the money that they need to live comfortably, because we want to ensure that no one is in a low income level.
Senator Marshall: Not all your programs are means tested, though, are they?
Ms. Spence: That’s correct. No, they’re not.
Senator Marshall: Usually a lot of this information is in your database with regard to incomes. It would have to be verified. So it’s not done through programming or anything; it’s more through surveys, is it?
Ms. Spence: Yes, through surveys and through their entitlements, too. For example, the earnings loss program provides 90 per cent of the veterans’ prerelease salary. It’s built on what they made before they left the military.
Senator Marshall: For the Canada Remembers Program — that’s a $55 million program — it’s the percentage of Canadians who feel that the remembrance program effectively honours veterans. Your target is 70 per cent, and you’ve got 76 per cent, 73 per cent. So, you’re above your target.
How would those amounts be determined?
Maureen Sinnott, Director General, Finance and Deputy Chief Financial Officer, Chief Financial Officer and Corporate Services, Veterans Affairs Canada: Those are determined primarily by feedback that we get from the population: if anyone has answered surveys with respect to information; also attendance at remembrance ceremonies; and participation by schools, and so on, in remembrance ceremonies.
Senator Marshall: Would it be a multitude? I was looking at it and it’s a $56 million program. It shouldn’t just be one criterion, or one survey. It should be a number of factors, I would think. So is it a number of factors?
Ms. Sinnott: There are different factors used to measure that.
Senator Marshall: And then the department would merge the factors and come up with the percentages.
For the veterans ombudsman, there is a target of 80 per cent for acceptance of his recommendations. It’s always over 80 per cent, but I notice it is decreasing. Where did the 80 per cent — what it looks like is this. I’m a former auditor so I will tell you my logic.
You started three years ago at 91 per cent, so the target is 80, so you started three years ago at 91, now it’s down to 93, now it’s down to 81. The target was set, so it seems you’re getting towards your target but, because it’s the department that accepts or rejects the recommendations, you can make it fit the 80 per cent. Where does the 80 per cent come from?
Ms. Sinnott: That’s a good question. Thank you for that. I could say we always aim to meet our target but it’s good to be above the target. We do accept the majority of the Veterans Ombudsman’s recommendations and the department works hard to respond to them and to put items in place. I can’t really speak to how we got to a decreasing amount.
Senator Marshall: And even the 80 per cent. Continue.
Ms. Sinnott: I can bring information back to the committee, if you like.
Senator Marshall: That would be very helpful.
Is there anything more current? I notice the data is over a year old now, so is there any current data or interim data on some of those performance indicators, or is it just the one year?
Ms. Sinnott: We will be coming back with our results reporting in the fall again, so we don’t really have interim reporting. For some of our newer programs, we track almost daily if there are increased applications, what our approval rates are, and so on. But for full results reporting, we will be back in the fall with that.
Senator Marshall: How do you decide the percentage of clients who are satisfied with your services, because I notice that’s a performance indicator, too. Is that from the survey?
Ms. Sinnott: That’s from the client survey.
Senator Marshall: My last question for today is the percentage of complaints closed within 60 working days. Your target is 75 per cent, which I thought was low. You haven’t been meeting the target. It’s 72 per cent, 62 per cent and most recently 60 per cent. So it’s going in the wrong direction. The question I have is, what corrective action would you take when you have a performance target that you’re not meeting? In fact, you’d like to get better, but you’re getting worse.
Ms. Sinnott: I would start with this. The department’s almost a victim of its own success, in some respects. We’re forever out there trying to contact more veterans, see if more assistance is required, see if people need to apply to our programs. So, when you do get an onslaught of applications, and it’s successful that our outreach has brought in more individuals, sometimes you’re a victim of your own success in that the percentage that you’ve treated has gone down. We end up trying to hire more staff, to find better and faster ways to provide service, to resolve issues and complaints, and so on.
It’s difficult to say it’s a work-in-progress, but it is. It’s something that we take very seriously and are working forward on.
Senator Marshall: So, the $21 million that’s in Budget 2018, this should help to make your performance indicators better. It should improve the performance indicators.
Ms. Sinnott: Yes, it should.
Senator Pratte: Did you want to go before me?
Senator Eaton: The chairman was looking at right at me.
The Chair: Thank you, senator.
Senator Pratte: If we forget the numbers — this is for Veterans Affairs — for the bump in the budget for the expenses for 2017-18, and we compare 2018-19 to 2016-17, there is an increase of over $600 million. Would that be more attributable to the increase in the number of veterans or because there were new programs and more help for veterans, or both?
Ms. Spence: Thank you for the question. I would say it’s a combination of both. As Maureen has said, we are a victim of our own success in terms of doing more outreach and trying to get veterans to come forward for benefits and services.
There is also the demographic factor that the number of Canadian Armed Forces Veterans served by the department is growing in leaps and bounds every year, while the traditional war service veteran population is declining. So it’s both.
Senator Pratte: And the numbers for 2018-19 don’t include the new program, which is I think called Pension for Life, and which has no bearing on the numbers for next year, for 2018-19, right?
Ms. Spence: That is correct.
Senator Pratte: So Pension for Life would come in the year after that?
Ms. Spence: Next year, yes.
Senator Pratte: I should know this, but, do we know what the impact on the department’s expenses will be for Pension for Life? Has that been published yet, or do we know that?
Ms. Spence: Nothing more has been published than what has been released in Budget 2018.
Senator Pratte: Thank you. I will look it up.
Senator Eaton: Has Senator Pratte finished well and truly in time?
My questions are not as erudite as my colleagues.
What is the Canadian Veterans Association of the United Kingdom line item? I’m sure there is a very easy explanation for that.
Ms. Spence: Yes, there is. It’s an association of veterans in the United Kingdom and it’s an annual grant that we pay every year.
Senator Eaton: Is it because they’re Canadian citizens that live there, or did they fight with Canadians?
Ms. Spence: I would really have to follow up to give you a proper answer to that question. I’m sorry. It’s such a small amount.
Senator Eaton: If you could send us information about why we send the money to Great Britain, that would be most appreciated.
Reading a speech, or the letter of mandate, given to the minister, he prepared to implement recently announced Budget 2018 initiatives including Pension for Life, which Senator Pratte brought up, and addressing the backlog. What is the backlog and where does it fall, mainly?
Ms. Spence: Thank you for the question, Mr. Chair. The backlog is, as I mentioned, in our Disability Benefits program. It has to do with the number of veterans who have applications in for disability awards at the moment. So it’s the number that are sitting, waiting to be processed.
Senator Eaton: Is it because it’s a whole system they have to go through and they have to get certain medical checks? Is it because it’s quite a long process? What is the process?
Ms. Spence: Yes, there is an application process, and sometimes applications come in and they don’t have all the information that they need to be adjudicated. So they have to wait until that information comes in. They can be at various stages — nearing completion or at the beginning of a process — but we call them all the backlog.
Senator Eaton: If I am a veteran and I have a disability, can I go to a hospital or doctor anywhere in the country and get the medical information you need for my application, or do I have to go specifically to a veterans’ hospital?
Ms. Sinnott: No, you don’t need to go to a veterans hospital. We don’t have any veterans hospitals anymore. In Veterans Affairs we negotiated our last one with the province of Quebec and now it is there.
What happens, generally, is that a member of the Canadian Forces would come to Veterans Affairs and apply for a disability award with respect to an injury incurred during service. They would have had some kind of documentation while they were in the Canadian Armed Forces that documented “I was injured at Day X doing exercise Y, or in Afghanistan, or in some place,” and then they would apply to us for a disability award with respect to that. We would be looking for information from the Canadian Armed Forces that would substantiate that.
As well, the individual may or may not be released from the forces and be attending their own family physician and receive information from the family physician who says the injury is complicated by various other factors. All of this information would be pulled together. We’d also need service information and so only.
When a veteran applies, they provide quite a bit of information. Sometimes the information isn’t necessarily all there, so we would go back to them, call or speak to them, and say that if we had this piece of information, it would be more helpful.
Senator Eaton: Can you tell us what the backlog is presently?
Ms. Sinnott: I do not have that information with me, but I can submit it afterwards to the committee.
Senator Eaton: Would you mind? It would be very interesting for next year. Do you also have a target for reducing it for next year?
Ms. Sinnott: There is a major effort being made by the department to reduce any backlog that we have in order to treat all of these applications in a timely manner.
When I said earlier that we’re a victim of our own success, the other thing we’re trying to do is to predict human behaviour when we staff up. You don’t know when someone is going to come to the department, whether they come on the day they are released, the day after they were injured, or 10 years later. So we try to track that, as well, to see when people apply, how long it takes before they come to us, and so on. Predicting human behaviour is not really a simple matter.
Senator Eaton: No, it is difficult. If you could supply us with the number of people whose applications are waiting for approval, that would be helpful.
The Chair: I have a few questions, and maybe we could have Ms. McIntyre take one of those questions.
In Budget 2018, we allocated $42.8 million over two years, on the same wavelength as Senator Pratte and Senator Eaton, to increase service delivery capacity to Veterans Affairs.
How would the funding increase service delivery capacity? Why only two years? What happens after that? And my last question is, what is the current ratio of clients to service agents in VAC?
Ms. Spence, Ms. Sinnott, or Ms. McIntyre.
Ms. Spence: Thank you for the question. I’ll start and ask one of my colleagues to join in.
In terms of how to increase service delivery capacity, as we stated before, the funding is all contained within our operating budget and the majority is earmarked towards new hiring; so a two-year bump-up of our staff.
Why two years? Because, as we have just spoken about the backlog, the idea is to eliminate that where we can get to a steady-state level again where we can adjudicate benefits on a more timely basis.
In terms of the current ratio of clients to case managers, we are aiming for 25 to one. That’s our goal. We haven’t met that everywhere in the country, and I would have to follow up with the committee to provide you with exactly what those numbers are in various areas of the country today.
Did I get all your questions?
The Chair: Absolutely.
Honourable senators, our next meeting will be tomorrow evening at 6:45 p.m., Victoria Building, and we’ll have the officials from DND appearing on Main Estimates.
To the witnesses, thank you very much for your comments and answering the questions of the Finance Committee.
(The committee adjourned.)