Government Operations Committee on June 16th, 2009

[John Wiersema]

Consistent with the appointments to most crown corporation boards of directors, these are order-in-council appointments, where the legislation requires that the Governor in Council consult with the corporation's board on the appointments.

We have done some audit work in the area of Governor-in-Council appointments, going back to I think the early 2000s, where we have expressed concerns with that appointment process. Indeed, quite recently, Mr. Flageole issued a report revisiting the concerns with the appointment process. Essentially, they're Governor-in-Council appointments in consultation with the board.

In the case of Downsview, I think Mr. Flageole can go ahead.

[Richard Flageole]

In the case of Downsview, they have a 12-member board. When we did the special examination, I think we were quite satisfied with the governance practices and the way the board was overseeing the corporation. One point we noted in the report is that as of the end of April 2008, eight directors had been appointed between January and October 2007, including the chair. That's quite a turnover.

Mr. Wiersema mentioned the work we did on the Governor-in-Council appointment process. I guess one of the key issues we raised was the timeliness of the appointments, but there was also the staggering of appointments. I think it's important to make sure that you don't replace two-thirds of the board at the same time. It has quite an impact on continuity and the operation of the board. Downsview had to deal with this. We concluded that it was okay, but that's something that needs attention in the future when appointing people to boards of directors.

[The Chair, Liberal, Derek Lee]

Thank you.

That was two five-minute rounds, just for the record, in case anyone is counting.

Ms. Foote for five minutes.

[Judy Foote, Liberal, Random—Burin—St. George's, NL]

I'm going back to the crown corporations. Have you done a special examination of Marine Atlantic?

[John Wiersema]

Yes, indeed, Mr. Chairman. We are in the final stages of completing that special examination as we speak. I expect that the report will be formally transmitted to the board of directors of Marine Atlantic in the coming weeks. It's almost done.

[Judy Foote, Liberal, Random—Burin—St. George's, NL]

Is that one that will be tabled and available for viewing by anyone other than the board of directors?

[John Wiersema]

As I indicated in my opening statement, Mr. Chair, crown corporations, as a result of the amendments to the Financial Administration Act, are now required to make those reports publicly available within 60 days of receiving them from us.

Next year, as we've done for the past two years, the Auditor General will present another summary report on all the special examinations that we have completed in 2009, so I would expect that this would be in the equivalent chapter that we're discussing here today. The equivalent chapter will be produced for Parliament next year.

[Judy Foote, Liberal, Random—Burin—St. George's, NL]

Are you able to tell me today, before it goes to the board--I can almost anticipate your answer--if there are any significant deficiencies?

[John Wiersema]

I think you anticipated my answer correctly.

[Judy Foote, Liberal, Random—Burin—St. George's, NL]

There's no harm in trying.

[John Wiersema]

I don't think it would be appropriate for us to talk about this in a public forum before the board itself and the responsible ministry have formerly received the report.

[Judy Foote, Liberal, Random—Burin—St. George's, NL]

Let me ask you another question then.

Clearly it serves as the link between Nova Scotia or the mainland of the country and Newfoundland and Labrador. Have you looked at the vessels that are being operated and made any determination in terms of whether there are any safety issues or whether they need to be replaced? I know they brought in one new vessel, the Atlantic Vision, but my sense, in discussions with others, is that they need more in order to be able to provide the type of, what you refer to here as, effective operation.

[John Wiersema]

Mr. Chairman, the member is quite right.

We will look at all key systems and practices that we think are essential to the corporation's success. The operation of its fleet to sufficiency, the funding of its fleet, its safety record, and so on would all seem to be systems and practices key to the success of that corporation. I expect they are within the scope of the special examination. I'm sure the member will be very interested in seeing that report, if I can do a bit of a commercial. That report will help you with the answers to some of your questions.

[Judy Foote, Liberal, Random—Burin—St. George's, NL]

Thank you.

In terms of the operation of Marine Atlantic, my understanding is that the cost recoverable in terms of the crown operation is on a 60-40 split. Are you aware of that? Is that a number that's determined by the corporation? Would you have any input when you do a review of it as to whether that makes sense--considering that it is in fact the transportation link--and whether it should be a 60-40 balance or a 50-50 balance?

[John Wiersema]

When we do the special examination, we will look at how the corporation is funded. The member has correctly pointed out that this corporation is funded in part through the tariffs it charges, and it also receives government funding. We will look at how the corporation manages that. The ultimate decision as to the right balance--whether it is 60-40 or 30-70 or so on--is ultimately a policy decision of government. We will look at how the corporation manages that, but we would not make a comment on the policy decision that was taken on the relative trade-offs and what that balance should be.

[Judy Foote, Liberal, Random—Burin—St. George's, NL]

That's fine, Mr. Chair.

[The Chair, Liberal, Derek Lee]

Thank you.

Mr. Anders, go ahead for five minutes.

[Rob Anders, Conservative, Calgary West, AB]

Thank you very much, Mr. Chair.

You mentioned your involvement on the Great Lakes as a deckhand and a lawyer. I apologize, witnesses. Bear with me for a second here.

Did you know Jack Leitch?

[The Chair, Liberal, Derek Lee]

Yes.

[Rob Anders, Conservative, Calgary West, AB]

That's fascinating. Were you working with his company or another one?

The chair brought it up. It's related.

[The Chair, Liberal, Derek Lee]

He's a lovely man. I was actually his car driver for awhile.

[Rob Anders, Conservative, Calgary West, AB]

Really? That's fascinating. Was it the armoured car, or, was it--

[The Chair, Liberal, Derek Lee]

I won't go any further than that.

[Rob Anders, Conservative, Calgary West, AB]

I don't know if everybody knows, but there was a great deal labour strife and a battle over shipping in the Great Lakes. Mr. Leitch was under armed threat, and he had to take his family to and from various places in armoured vehicles at the time. So that's fascinating, very interesting. I knew that from my time serving with the National Citizens Coalition....

I will get back to some of our stuff about crown corporations, if I may.

I'm going to go through my list here. I have CBC, VIA, EDC, Atomic Energy, Canada Post, Bank of Canada, and CMHC. You mentioned, of course, that there are a number of museums, and you listed off the Museum of Nature and the Museum of Civilization as two. I don't know if that list of museums includes the National Arts Centre and the Canada arts council. I'm assuming it doesn't. Telefilm Canada, Federal Bridges, Canada Race Relations, and Canada Air Transport something--I'm not sure if I caught the full name of that....

[John Wiersema]

The acronym is CATSA, the Canadian Air Transport Security Authority, I believe. They're the people responsible for screening passengers. Among other things, when you go to the airport, the people who do those screenings are under contract to CATSA.