Government Operations Committee on April 2nd, 2009

[Pat Martin, NDP, Winnipeg Centre, MB]

We approved it on the condition that we get our say on whether we're going to get the best bang for our buck. Some of us think the best bang for our buck is raising EI premiums and eligibility rather than putting a new cruise ship dock in downtown Vancouver. I would argue that, but I'm not going to get the chance until after it's all done.

[Alister Smith]

But you've approved the budget as well, which I think contains those initiatives. This vote just provides that bridge of funding for the initiatives that have already been approved in the budget. The budget has passed in Parliament.

[Pat Martin, NDP, Winnipeg Centre, MB]

Okay, I understand. I'm not trying to be heavy-handed with you, as the technical experts. We appreciate your being here.

Can I ask you, then, where the public's comfort is that there's no hanky-panky going on with the application of how this money is spent? How do we know it's going to be spent in an impartial, non-partisan manner? Can you tell us how we can get some comfort that there are those safeguards?

[Alister Smith]

Of course there will be internal due diligence, internal audit. There will be external due diligence, with the Auditor General. All of those due diligence requirements are being met.

[Pat Martin, NDP, Winnipeg Centre, MB]

But when you're six months away from a federal election, that spending is going to happen now and the ruling party is going to get the credit for that spending. It might be after the fact, if ever, that we get a chance to assess whether the money was distributed fairly. That's why we've been saying we need something at the front end. In fact I think that's why this committee was created, so there would be an analysis of the estimates in greater detail instead of an analysis after the fact, with the public accounts committee and the Auditor General.

In my home province of Manitoba, you drag the minister before the estimates committee and sometimes they're there all night, going line by line. “How can you possibly propose to spend that? Why do you propose to spend here and not here?” We don't do that in this Parliament at all.

With these extraordinary circumstances, such that they're asking us to approve, and we have in fact approved, we want a greater element of that advance analysis. We want to know if it's a good idea to spend this money in the way they're proposing. And we want to be assured that there's no hanky-panky or attempt to spend that money to the best advantage of the ruling party, which some of us more jaded people strongly suspect there will be.

Thank you.

[The Chair, Liberal, Derek Lee]

Thank you, Mr. Martin.

For the record, the department has provided the transcript of opening remarks in both official languages.

Thank you very much.

We're going to go back and forth with members here. I have a couple of questions myself.

Who will be next? We will go to the Liberals, if you're ready to proceed, Mr. Szabo.

[Paul Szabo, Liberal, Mississauga South, ON]

Thank you.

Gentlemen, the committee has a unique mandate right now. I don't think that any committee has really undertaken to get so significantly involved in the monitoring and accountability aspects of government expenditures, but these--as I think you said, Mr. Smith--have economic implications. The importance here, which I think all members would agree with, is that all the parties spent some equity to work this budget to get it to this point where there is this facility....

Not getting the cash out in the first quarter isn't an option. What advice do you have for the committee, to monitor, anticipate, respond, and react, to ensure that all the cheques are out by the end of June?

[Alister Smith]

This mechanism, again, is an allocation mechanism. That is, it requires that any funds from this central vote be allocated by the end of June. It does not require.... One would hope, certainly, and it was created for this purpose, that a great deal of that spending would occur right away. But once the funds are allocated to departments, they have to run the programs in a proper manner, in a manner that meets the needs of partners and recipients.

So you can't be absolutely assured that all funding is going to flow before the end of June. Indeed, some of it will, and some of it will continue to flow after the end of June. That's appropriate, depending on the particular program.

As we mentioned, we will be reporting on the effects of these initiatives, to the extent we can, in the June report and in later reports.

[Paul Szabo, Liberal, Mississauga South, ON]

Perhaps I can stop you there, because your first part causes me significant concern. The government made a commitment that on April 1 the money's getting out. I'd like to know how much money went out, you know, today.

We do understand that there are timelines. That's why, in the discussions, it was clear that $3 billion, to have the impact on shovel-ready or whatever it is, to be able to generate results at a critical time, at a time when Canadians need the jobs related to these moneys, the discussion always centred around the fact that you may not be able to provide in detail where all this spending is going, but all of the programs will have the lead time necessary to identify them, to work out the details, to fine-tune them, to get the approvals, the requests, the authorizations. That takes time.

A lot of that, necessarily, has already been done. I'm asking you whether or not it's realistic for this committee to start to monitor the stage at which dollars are in the process of leading to getting the cheque out. If the committee starts to detect, a couple of months out, that very few of the dollars are really out, or if you go past and there's lapsing at the end of June, that may destroy the whole strategy of having vote 35.

The strategy is that the cash has got to be out. This committee, I think, wants to be accountable, to report to Parliament, to carry the ball to Canadians that the moneys are there. We understand that even once the money is put in the hands of the third-party program provider, there will be economic lags for them as well. It doesn't happen instantaneously.

Again, June reports are fine, but I think this committee really needs your advice here. How can we monitor the progress of the process of getting $3 billion of cash into the hands of program providers before the end of June? Are there mechanisms or resources available to the committee to do that, or people who are better suited? I don't think the committee has to know very much about the micro-detail of projects, but to know, rather, that the representations of the departments are consistent with the objectives of the budget.

I think we need some words of advice. If it can't be done, the committee should know now.

[Chris Forbes]

I'll give you my comments just generally on that.

In the first report we put out, at the beginning of March, we basically laid out, budget item by budget item, the stage in the approval process that it was at and when the cash was expected to flow. We gave a fairly detailed summary for each item--where it was at; what it needed in terms of authorities; when those were expected to be received; when, in the case of benefits, the cheques were expected to flow; in the case of tax reductions, when people would see the effects on their paycheques; and in the case of specific programs, when we might see whatever the next stage was, such as agreements with provinces, or benefits flowing to Canadians.

So we've laid out a fairly specific and detailed timeline for program-by-program progress, if you will, toward delivering benefits and getting the money flowing. As my colleague has said, what Treasury Board has done is provide, then, once the proper authorities are obtained, the allocations to the departments--or departments can cash-manage, or wait until supplementary estimates A, but as per their own decisions--when they need to access that money.

Departments have given us, and the government as a whole has given, a fairly specific plan as to what your progress markers are, budget item by budget item. So I think that—

[Paul Szabo, Liberal, Mississauga South, ON]

Are you talking about vote 35?

[Chris Forbes]

Pardon me?

[Paul Szabo, Liberal, Mississauga South, ON]

Are you talking about vote 35?

[Chris Forbes]

Actually, I'm taking a broader question for the whole—

[Paul Szabo, Liberal, Mississauga South, ON]

I understand that. Please don't do that.

[Chris Forbes]

Okay. I apologize.

[Paul Szabo, Liberal, Mississauga South, ON]

Okay.

Again, I got the sense from just the way things were going that until Mr. Smith said the economic implications are crucial to vote 35, because it is dependent on cash being out.... I think you have to stop talking about, oh, they've got proposals in. There isn't a list of projects available. Government told Parliament that.

[The Chair, Liberal, Derek Lee]

Okay.

[Alister Smith]

Could I perhaps address...?

[The Chair, Liberal, Derek Lee]

Yes, you may, fairly quickly.

[Alister Smith]

I will confine myself to vote 35.

We are monitoring all of the budget implementation, including vote 35. What Mr. Forbes was saying does apply to vote 35 as well. We are monitoring it closely.

I would suggest, though, that if you really want to know the progress on an individual item that has received funding through vote 35, the department is the best place to provide that information. You may very well want to draw on Infrastructure Canada or one of the other departments that's key to budget implementation in asking exactly how well this is progressing. We are going to be monitoring and we are monitoring already, and we monitored for the first report. We'll keep monitoring the progress, the funds, and all aspects of the budget implementation to make sure, indeed, that as much of this happens as early as possible.

[The Chair, Liberal, Derek Lee]

Thank you.

Madame Bourgeois.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Thank you, Mr. Chair.

My question is brief and does not deal necessarily with Vote 35 but on the work that the three of you do. I am meeting Mr. Sargent from the Privy Council Office for the very first time.

When a department awards a contract worth $500,000, $1 million or $1 billion, does your role not consist in managing these expenditures, and asking questions with respect to the contract's plans and priorities? Do you make sure that the amount of $1 billion is going to the right place and that there will be positive economic spin-offs for Canada? Do you make sure that savings are made?

[Alister Smith]

I'm afraid that's more in our terrain as well than in the Privy Council Office's.

In general, the Treasury Board is responsible for the policies on project approval and for contracting the big policies. Departments have delegated authority to provide those projects and contracts. Within the terms and conditions of the program, the departments manage the projects specifically.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

To come back to the question asked by my colleague from the Liberal Party, Mr. Szabo, when departments award contracts under Vote 35, you Mr. Smith, should be able to inquire into the soundness of these contracts.

Am I mixing apples with oranges or am I on the right track?