Government Operations Committee on Oct. 22nd, 2009

[Michael Buda]

First, just to clarify, that loan program is actually for infrastructure, it's not for housing. But you're right, the low-interest loan is going to be available essentially at cost to what the government achieves with its own borrowing.

It's over a 10-year period, and the 0.25%, of course, isn't a daily overnight rate. For most provinces and municipalities, 10-year loans are running at about 3.5% to 4%. For the Government of Canada, it's a couple of points less.

This indeed is a very low-cost loan program. It was made available primarily to help municipalities take out additional loans to help fund stimulus programs, for which, of course, it didn't receive approval until after they had approved their own budgets.

[Pat Martin, NDP, Winnipeg Centre, MB]

That's interesting.

[The Chair, Liberal, Yasmin Ratansi]

And you're out of time.

Mr. Warkentin, I know you have some information you'd like to give us. If you give me one minute, I'd like to wrap up some things. Then we'll take that information.

As Mr. Martin indicated, this is the committee that reviews the way government spends money. For any government, whichever label it carries, it is important that taxpayers understand and are comfortable that there is an oversight. That's what this committee does.

We called you as the stakeholders of or the beneficiaries of some part of the infrastructure funding. Whatever information you give or do not give us, this is how the committee will proceed. It is in your best interest to give as much information as you possibly can to us. That's your prerogative. It's the committee that can ask you the questions, and if you don't supply the information, the committee does not have any more things to do then. Then it says, “Fine, that's what they want.”

But you represent large municipalities and small municipalities. It's your membership that you're representing. It's your membership that's being affected by these investments.

For example, were you aware that the government had demanded $3 billion way back in March that they wanted to give to projects that were shovel-in-the-ground-ready projects? Nothing happened. That money went back to the consolidated revenue fund. So if you are familiar with it.... Then the money got rolled over to the other funding. That's what public finance is: if you commit and do not utilize, it goes back. Then another budget comes. That is why the questions you've been asked were so direct.

What I would suggest is that in your closing remarks, if you have any additional information from your membership that has been rolled out to you as to the number of jobs that have been created.... It says there'll be 220,000 jobs created, or 190,000 jobs created. Has your membership indicated to you the number of people that they have employed or that the municipality has invested in? If you have that information, that would be good. If you don't have that information, I'm sure Mr. Warkentin has some information that he'll supply.

But I'll give you another example. Mr. Warkentin said my riding had investment. I did a photo op with my counterpart, and I got calls to my constituency saying that has not happened: the province put up the money, but the feds have not given the money. Those are the things people are dancing around saying, “What is the reason we're not getting the funds?” It was supposed to stimulate the economy. Did it stimulate the economy? You do not know because stimulation is an economic thing, as economists will say.

In your closing remarks, then, would you take the liberty of giving us as much information as you can?

Who will be speaking for FCM?

Mr. Cunningham, you will supply us information later?

Yes, Mr. Jean.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

On a point of order, Madam Chair, you mentioned the federal government part hasn't flowed yet. But you know, as everybody knows in this room, that the federal government pays on an invoice received from the municipality or the province, except for, of course, the gas tax fund.

I just don't want the record to be showing that the federal government hasn't put the money out, because we don't put the money out as a government. No government does.

[The Chair, Liberal, Yasmin Ratansi]

No, no, no, I am very clear. I do public finance. Commitment is commitment. It's not been expensed.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

But it's paid on an invoice.

[The Chair, Liberal, Yasmin Ratansi]

Yes.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

Okay. I just want to make sure the record's clear on that.

[The Chair, Liberal, Yasmin Ratansi]

The $3 billion was supposed to have flown to municipalities because it was claimed that there were shovel-in-the-ground-ready projects.

[Brian Jean, Conservative, Fort McMurray—Athabasca, AB]

But it doesn't flow until the invoice is received, Madam Chair.

[The Chair, Liberal, Yasmin Ratansi]

That's right. So we are playing with semantics.

To conclude then, you will have a few minutes to give us your closing remarks. We will go from Mr. Cunningham to Monsieur Perras and then Monsieur Généreux.

[Hans Cunningham]

Thank you, Madam Chair.

I wish I could give you more statistics other than what Mike has already given. But these are our key messages.

One, our biggest concern is about the stimulus package and what happens after it's gone. We're worried about a long-term infrastructure deficit and how to fix it.

Two, we cannot afford to repeat the mistakes of the 1990s when federal and provincial governments pushed deficits off their balance sheets and into the local streets. Key investments such as the gas tax fund, GST rebate, and cost infrastructure programs must be maintained to protect our quality of life and strengthen our economy.

Three, in the near term, all orders of government must commit to keep the stimulus plan on track and put every single dollar to work in communities across the country. I think we all agree on that.

Four, to keep the stimulus plan on track, governments must continue to work together and show flexibility. Of course, it's a tripartite union to put these projects there. It's the federal government, the provincial or territorial governments, and of course the municipalities. Everybody has to be pulling in the same direction.

Thank you.

[The Chair, Liberal, Yasmin Ratansi]

Monsieur Perras.

[Jean Perras]

Thank you, Madam Chair.

The key message is that in spite of the fact that this is a short-term economic stimulus plan, efforts to rehabilitate infrastructure have to continue on a 15 year horizon. Unfortunately, I can't give you the information you want. I told Ms. Bourgeois that once the November 1 municipal elections in Quebec are over, we will be able to consult our members.

The Union had been calling for infrastructure programs for a long time, and we are pleased with it.

I'd like to remind everybody around this table of what we are talking about from a strategic point of view, and we've discussed this with our friends at the FCM and FQM. Forty-six percent of all the federal, provincial, and municipal revenues go to the federal government. Forty-six percent goes--tax, income tax--to the provinces and 8% comes to the municipalities. With that 8% we're supposed to do everything that we're being asked to do, plus there's downloading from our respective governments. We have been asking for a long-term view of structural adjustments on what we consider our key elements, such as infrastructure programs.

Work on infrastructure in Quebec has increased visibly, but nothing is perfect, it will take time. There have been examples in Quebec where programs were considered to be ending on a certain date. Extensions were given because of various things that happened.

All kinds of things happen. I'm doing a structural project right now in one of our villages. We dug to see if there were rocks. We dug in five places, but in between the places where we dug we found rock. This threw the project into an uproar because we had to come back and deal with the rock differently. There are all kinds of reasons why projects are not going as fast as possible. That's reality. We live in an imperfect world.

In conclusion, the UMQ would like to see both higher levels of government coordinate their priorities better so the programs will be better tailored to the situation in Quebec.

Thank you.

[The Chair, Liberal, Yasmin Ratansi]

Thank you.

Monsieur Généreux.

[Bernard Généreux]

Thank you, Madam Chair.

Certainly we are again pleased and would like to point out how important this program to assist in upgrading our infrastructure is. I also join my colleagues in calling for permanent programs because of the need to plan the work of upgrading our infrastructure over time.

In terms of knowing the extent to which the programs have been rolled out, you are asking us to take on a responsibility that may lie with your own committee or the government. To ensure that what is going on everywhere in the country is being monitored, you need the resources to go and get that information. Providing accurate information requires considerable resources.

The discussion today hinged to a large extent on actual progress made in the infrastructure strategy. It is somewhat unfortunate that we did not have more concrete facts or ways of assessing it, but we still feel that things are moving in the right direction.

We have to agree on better terms and conditions, that will make it possible to move ahead quickly on these programs. We must not forget that it would be unacceptable to leave the money needed for upgrading our infrastructure on the table.

Once again, this means abiding by the division of powers. We have to find formulas that simplify access to this money and also provide flexibility in terms of deadlines.

I am not saying there should be no cut-off dates, but we must make absolutely sure that the money available is fully committed for improving the quality of life in our communities.

I hope we will be able to benefit from these programs and at the same time be able to avert any of the temptations of party politics that so often arise when these measures are rolled out.

[The Chair, Liberal, Yasmin Ratansi]

Thank you.

This was supposed to be non-partisan stuff that we were trying to get you to say, and I think a cities agenda where the cities and communities sit down with the federal and provincial governments will probably help you in your discussions.

What you have to say, Mr. Warkentin, is to the committee, so I will let the witnesses go meantime.

I'd like to thank you all for being here, and thank you for taking time off to supply us with information. Thank you very much.

Mr. Warkentin has some information that he'd like to share with the committee.

The floor is yours, Mr. Warkentin.

[Chris Warkentin, Conservative, Peace River, AB]

Thank you, Madam Chair.

I just thought for the sake of transparency I would provide the committee with some documents that some committee members may not have been able to find. I found some that are not secret, but are actually available to the public. I specifically pulled out a document that outlines all of the projects that will be funded under the infrastructure stimulus fund in the province of Manitoba. I'll give this to the committee; it's in both French and English. It think it will be helpful to Mr. Martin, who said he had not yet been able to find out what's being funded under that stimulus fund. So I have that document.

In addition to that, I also have a backgrounder from the FCM. There were some questions with regard to the number of jobs being created as a result of this. In this backgrounder they actually do a calculation as to the numbers of jobs being created: it's 11,500 for every $1 billion spent. I can provide this document in English and French.

[The Chair, Liberal, Yasmin Ratansi]

You can provide it to the clerk who will have it translated.

[Chris Warkentin, Conservative, Peace River, AB]

Perfect. Thanks so much.

[The Chair, Liberal, Yasmin Ratansi]

Thank you very much.

The next item is the minutes of the steering committee, and I guess, Ms. Hall Findlay, you have an amendment to item number 4?

[Martha Hall Findlay, Liberal, Willowdale, ON]

Yes, thank you, Madam Chair.

In the first two points we had mentioned the people by name who we had asked to be included. I just note that on the fourth one, we had in fact specifically requested not only the President of the Treasury Board and relevant representatives as needed, but also the former clerk of the PCO, the current clerk of the PCO, and the catch-all language, “whatever other representatives would be needed”.

[The Chair, Liberal, Yasmin Ratansi]

So you want us to name whom we are going to invite?

[Martha Hall Findlay, Liberal, Willowdale, ON]

Or just put them down by title: the President of the Treasury Board, the PCO clerks, former and present.

[The Chair, Liberal, Yasmin Ratansi]

Fair enough.

Since we had received your request and had asked members of the committee to send a list of suggested witnesses, we will make those amendments.