Government Operations Committee on March 25th, 2014

[Bill Matthews]

This one is a bit odd, so thank you for the question, and please bear with me.

Remember that I have told this committee in the past that the budget is on a full accrual basis and estimates are on a modified cash basis. That is an important point when we think about this.

The government is moving to a new payroll system. Effectively, if you were to look in the private sector or at other governments, your basically common systems run with payment in arrears; you usually get paid after the fact. Under our current pay system in government, we effectively get paid up to the day. We're transitioning to an off-the-shelf system, which means pay in arrears. If we were just to implement that without doing anything, we would be asking employees to skip a paycheque, which doesn't make a lot of sense.

Effectively, from an accrual perspective, from a budget perspective, there is no impact whatsoever. There are savings because this will be a more efficient system, but there is no impact in terms of payroll expense.

From an appropriations perspective, there's an additional charge against departments' appropriations because of this change. Given that departments have been coming out of a strategic and operating review and that we have an operating budget freeze, we wanted to make sure that departments had enough money to fund that extra charge. That's what this is there for.

This is the reason for the increase. It is a one-time, bizarre requirement, but....

[Bernard Trottier, Conservative, Etobicoke—Lakeshore, ON]

I guess that from the point of view of cash leaving the treasury, there is actually no change; it's just the way it's accounted that is different.

[Bill Matthews]

The timing is changed, yes, exactly.

[Bernard Trottier, Conservative, Etobicoke—Lakeshore, ON]

I want to follow up on a theme that was discussed by my colleague about the division of responsibilities between different levels of government.

You mentioned in your presentation some new initiatives for affordable housing that were being proposed in this year's estimates, based on budget 2013.

In the city of Toronto, where I'm from, you have the federal government doing certain things with affordable housing, the provincial government doing things, and the city running affordable housing, and so in some ways we're tripping over each other. I want to get a sense of the specific things the federal government is doing with respect to affordable housing. Is it not interfering with things the provincial and municipal governments are already doing?

[Bill Matthews]

Regarding social housing or affordable housing run by CMHC and the federal government, slide thirteen of the presentation mentioned two amounts for investments in affordable housing. Obviously, to spend that money efficiently, you have to work with other partners.

I will highlight for you that the second piece of this is $70 million for housing in Nunavut. The role in territories is a bit different. Just to speak to Nunavut specifically, housing costs in Nunavut are through the roof; it's quite expensive to live up there. So there is a specific amount listed there.

As for the $253.1 million in affordable housing, I'm not sure whether Marcia can offer to explain how it works with provinces.

No? We will have to—

[Bernard Trottier, Conservative, Etobicoke—Lakeshore, ON]

In fairness, that is more of a question for the Minister of Employment and Social Development.

[Bill Matthews]

It's a good question.

[Bernard Trottier, Conservative, Etobicoke—Lakeshore, ON]

It's always a concern of mine, when we have different levels of government trying to do the same thing, that we create redundant bureaucracy. I suppose there are other programs out there, too, that are like that.

You talked about the consolidation of CIDA under the Department of Foreign Affairs, Trade and Development. There's an increase in Foreign Affairs, Trade and Development of $3,037.9 million and then a decrease in CIDA of $3,159.3 million.

There seem to be some savings as a result of this merger. Can you describe what is going on? Were there some senior management savings from having CIDA become part of DFATD?

[Bill Matthews]

Actually, what you're seeing is there were already planned savings in both of those organizations because we were heading into the third year of reductions due to the deficit reduction action plan. The merger itself was not done to generate savings; it was done more to align policies. There's no number I can pull saying that these are the savings from that merger. It was very much done from a policy alignment perspective.

The reason for the reduction you're seeing here is that there were already some planned reductions in those organizations because of the tail end of the deficit reduction action plan.

[The Chair, NDP, Pierre-Luc Dusseault]

Mr. Trottier, you have a few seconds left.

[Bernard Trottier, Conservative, Etobicoke—Lakeshore, ON]

You mentioned that the Canada Revenue Agency appropriation is decreasing by $400 million or so and that half of that is due to e-filing. This trend around people interacting with the government electronically must be driving savings throughout government.

[Bill Matthews]

It is driving savings throughout, and CRA is the best example.

As mentioned, half of that saving relates to softwood lumber, and the other half is administrative savings. I highlighted e-filing as an example, but to talk further about this, they have changed rules so that major tax preparers who file more than 10 returns must do e-filing. For you and me, it's voluntary; if you're in the tax preparation business, you now must do e-filing. There are savings there.

They did one other thing on the paper-based side. They used to send tax return information out by registered mail. Now they use regular mail. That's a savings as well, even though it's still paper-based. This is not the only thing they've done from an administrative perspective, but the “e” part of this is certainly a big component.

[The Chair, NDP, Pierre-Luc Dusseault]

Thank you.

Before the meeting ends, I will give the floor to Mrs. Day.

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

Thank you.

Mr. Matthews, I am going to ask you a few questions about the Old Port of Montreal Corporation.

The latest budget has a decrease of $24.5 million compared to main estimates 2013-14. As we know, the Canada Lands Company has merged, but can you tell us where the money has gone?

[Bill Matthews]

The money itself, as far as I recollect, and I may ask my colleagues to help me out.... They've moved the organization. I'm not aware of an actual reduction in funding for Old Port of Montreal; I think it was effectively just a transfer of responsibility into the Canada Lands Company. You're likely not seeing it presented in the way you used to, but my understanding is that it's just a movement of organizations from a responsibility perspective.

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

Have the lands been sold?

[Bill Matthews]

They have not been recently, to my recollection, no. But I'm wondering whether.... I haven't looked at the Canada Lands Company corporate plan documents to see whether there's any news there, but to the best of my recollection, no.

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

I would like to ask you a question about the estimates, which, from now on, exclude any funding deemed to have been assigned to a department following a transfer of a portion from the federal public administration. When there is a transfer from the federal administration, if we don't see it, how can we keep track of it?

[Bill Matthews]

Thank you for your question.

This does not relate to transfers between votes. As always, if a government department wants to use another department to help deliver its services, that's a vote transfer and it will run through supplementary estimates. You will continue to see that.

We've made a change in presentation in cases when we have an example, such as CIDA, when an organization is being moved into another department.

If you look at part II, it's on page 143 in the English version.

It is on page 5 of the French version.

Marcia, please feel free to correct me, but what we're dealing with is that when you look at the “Estimates to Date” column of 2013-14 for Foreign Affairs, you will not actually see the money from CIDA. Do I have that correct?

[A voice]

Yes.

[Bill Matthews]

I do. Okay. You won't see the money from CIDA because CIDA is actually still presented separately. That's the change we're talking about, just that “Estimates to Date” where the transfer happens in-year. We already had published CIDA's main estimates and we've kind of kept them there. The transfer of CIDA is not affecting the Foreign Affairs estimates to date. The main estimates for 2014-15 for Foreign Affairs absolutely do include that.

Correct?

[A voice]

Yes.

[Bill Matthews]

Yes.

[Anne-Marie Day, NDP, Charlesbourg—Haute-Saint-Charles, QC]

Yesterday, in the House, we heard a speech on homelessness by the Conservative members.

As we know, the funding for the homelessness partnering strategy (HPS) will be cut. The government talks about studies to determine the exact numbers and the state of homelessness in Canada, studies that cost several million dollars. At the same time, the government is cutting several millions from the HPS funding for homelessness groups.

Can you tell us how that will be handled internally?

[Bill Matthews]

I'm not sure that I can offer you any information on that front. Those might be very good questions for, I'm assuming, ESDC—what I will forever call HRSDC—to actually discuss, and for you to pose questions about homelessness and their programs. You may find some information in their report on plans and priorities in terms of programs, but I'm afraid that I can't speak to that particular question.