Government Operations Committee on Nov. 26th, 2013

[Christine Walker]

That's part of the monitoring program headed by Michael Presley in our organization.

[The Chair, NDP, Pierre-Luc Dusseault]

Thank you.

Mr. Blanchette, your turn for five minutes.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Thank you, Mr. Chair.

My first question is about VIA Rail. When the main estimates came out, I rose in the House because there was a huge gap between last year's estimates and this year's.

With these adjustments, the estimates are really similar to last year's. I'd like to know the reason why there's such a big difference between the initial amount and the amount we have now. Of all the federal agencies, VIA Rail might take the cake in that respect.

Were there problems as far as the drafting process was concerned? Do you have an idea of what happened?

A brief answer would be appreciated. Thank you.

[Bill Matthews]

To get a really good understanding of the spending at VIA Rail over the last several years—and I will eventually turn to my colleague for some additional information—let me say, Mr. Chair, that VIA has had some additional cashflow from the federal government over the last few years, from time to time, because of shortfalls in their pension. There was a need, from a statutory perspective, to provide additional funding for their pensions. That was part of the story.

Some intensive capital injections have also occurred in the past—not one-time funding, but certainly higher in some years than was planned for on an ongoing basis. It is actually okay to say that there's a one-time investment of this amount, and the ongoing investment will be less, so you saw a spike in the capital investment.

Those are the two things, off the top of my head. I will turn to my colleague to see whether there is anything else.

[Marcia Santiago]

I'll just add that if you are comparing main estimates from 2012-13 to main estimates of 2013-14, the biggest difference is simply that the budget 2013 funding hadn't been announced or approved through Treasury Board yet. If you look at the summary of estimates on page 17 in English and page 20 in French, you'll see that from the actual expenditures for VIA Rail in 2011-12 to their estimates to date for last year and their estimates to date for this year, it's actually not that much of a difference anymore. Total estimates in 2012-13 were about $478 million, and including supplementary estimates (B) they will be at $440 million. So it's comparable.

[Denis Blanchette, NDP, Louis-Hébert, QC]

That's actually what I'm saying. It comes down to the same thing.

I'd like to switch topics and talk about the gas tax. You said that two provinces and one territory had not spent their funding. Could you tell me which ones?

[Bill Matthews]

Yes, I can, Mr. Chair.

The two provinces were New Brunswick and Nova Scotia, I believe. And the Yukon was the territory I was referring to.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Very good.

How much does the gas tax bring in annually?

[Bill Matthews]

I don't know.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Very well. In that case, I'll ask Ms. Walker a question.

In terms of the Elgin Street redevelopment project, I'd like to know whether it's a new building or an existing one. The expenditures for Shared Services Canada, in particular, strike me as high. Could you explain the circumstances around the project? What does it involve? My understanding is that you're moving public servants from nine different locations all there. What will be the outcome of doing that?

[Christine Walker]

On the workplace renewal initiative, first of all, the bulk of our employees currently are actually in L'Esplanade Laurier, and it's a building that does need significant renovations, so we have to move out of that building. We will be moving to the building on 90 Elgin Street, which is the old art gallery, which is right across from the National Arts Centre, along with the Department of Finance. That will house about 60% to 65% of our staff. The second building is yet to be decided.

So why does Shared Services Canada need $3 million? That money goes towards all of the IT infrastructure. Today, Shared Services Canada, for instance, will provide all of the cabling for the Wi-Fi. Rather than going in networking, we're going to go Wi-Fi, where they will provide all of the cabling. We have a secret network for information; they will provide all of that. They also provide all of the telecommunications infrastructure in the building. That means all of the communications closets on every floor, that is all Shared Services Canada. In the past it wasn't Shared Services Canada, but now it is. So they need the money to be able to procure the equipment that is required for the IT infrastructure in the new building, at 90 Elgin Street. There will be about 1,600 employees in that building.

[The Chair, NDP, Pierre-Luc Dusseault]

Thank you, Mr. Blanchette.

Ms. Ablonczy, you have five minutes.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Thank you, Mr. Chairman.

I thank all of you for your assistance in following this.

I noticed that there seems to be a concern on the part of the opposition that government is not spending enough. I would point out that it's a pretty unique and positive problem to have in any country, considering the huge debt load of many of our peers in the developed world.

You mentioned, Mr. Matthews, the concept of value for spending, which is important because you can spend a lot of money but that doesn't mean you're getting a lot of value for it, or maximum value. So my question is, what process is in place to have a value-for-spending determination?

[Bill Matthews]

I would say a couple of things. The first is that there is a Treasury Board policy. It's called MRRS, but for today's purposes it's around performance reporting. It requires each department to outline the performance objectives and how they will measure those for each program they have. That's point one: to get Treasury Board approval of a program, you have to be able to explain what the objectives are and how they will be measured.

Point two is that there is also a requirement that all programs be evaluated every five years. An evaluation will look objectively at the results of the program and offer up some analysis of whether the results are being achieved. Those evaluations are made public. When each department finishes its evaluations, the results are posted on the departmental website.

The final piece of the puzzle would be in each department's report on plans and priorities and follow-up departmental performance reports. In those you will get a sense of what the program has actually done. The really key question for me, when there is an evaluation, is, what does it say?

That's the policy framework to make sure that there's value for money. If you look at the fairly recent expenditure reduction exercises, going back a few years we had strategic reviews. They were very much focused—and the government was in surplus when they started—on the question of whether we were getting value for money for the programs. The reductions that were made were for cases in which there was no federal role or in which we were not getting good value for money or something along those lines.

We borrowed those concepts when we did the strategic and operating review, but we brought in operations as well.

Those are the key things we do to look at programs.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

We're spending some time this afternoon as a committee examining supplementary estimates spending, but obviously this isn't the only oversight of spending that government exercises. Could you outline for Canadians, as well as for the committee, what oversight steps are put in place to monitor spending and make sure that it's appropriate?

[Bill Matthews]

This is one of the final stops of the train, the parliamentary approval of spending plans or an appropriation act.

Before it gets here, there needs to be a case made in the budget: someone has to convince the Minister of Finance and other cabinet ministers that a program is worth pursuing. That's step one.

Step two is the work of the Treasury Board itself. Before money can be spent, there are some detailed questions asked about how much is needed, what the objectives of the program are, how the department will achieve them, whether you could reallocate from within the department to fund the request. That's the Treasury Board piece.

It then comes here.

Then there's ongoing oversight of actual spending. I would point to deputy ministers as the accounting officer for each department. They are supported by such things as departmental audit committees, an internal audit function, and an evaluation function, which I have already mentioned.

Lastly, when the government's financial statements are prepared, there is an independent audit done to make sure that the departments are accurately reflecting their results in the way they were accounted for.

That's a kind of complete picture in 30 seconds.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Oh, that was very good.

How much time do I have?

[The Chair, NDP, Pierre-Luc Dusseault]

You have 30 seconds.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

I think we'll wrap it up there, then. Thank you very much.

[The Chair, NDP, Pierre-Luc Dusseault]

Thank you.

We now move on to Mr. Byrne for five minutes.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

I want to talk a little bit about what supplementary estimates should normally contain—what your normal expectation would be. You have the main estimates, which are done before the budget; then of course the supplementary estimates would take in things that the budget might provide for. But you also have things that are outside the budget.

For example, if there were a new program expenditure in regional economic development agencies that wasn't included in estimates and wasn't a budgetary measure, is it the expectation of Treasury Board that departments would try to stay within the discipline of the budget process, or is it simply that as cabinet approves things, they are eligible to be included in the supplementary estimates?

[Bill Matthews]

The budget is the most normal way that you'll see funding. The budget is once a year. So if you've got cabinet approval of something and there is a need to spend in the current year and you've missed the budget, is there a way around that? Yes there is. Departments can make a case to the Minister of Finance and the Prime Minister to get effectively an off-budget cycle funding approval. That means they have the blessing of the minister responsible for the fiscal results to go ahead and they have what we call funding approval.

That would still require them to come to Treasury Board and if there's money needed to be added to their votes they would still have to come through the estimates process.

You did mention that the main estimates are the bulk of the spending but there is more in supplementary estimates. You would also see things that are old programs. Oftentimes our programs have a five-year lifespan and they get renewed frequently but sometimes they don't get renewed to make it into the main estimates. So you may find the odd program that's been around for a while missed the main estimates but comes back through the supplementary estimates. The budget announcement there could have been quite some time ago.

I'll give you a good example from, I believe it was two estimates ago, the contract policing for the RCMP. If you looked at the main estimates you would have seen a massive drop in RCMP spending. It was because the contract renewal for that function with the provinces had been missed for the mains. It was, I believe, in supplementary estimates (A) so there was a big amount in the supplementary estimates that effectively brought the RCMP back to its normal levels. So you will see that from time to time as well.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

One item that caught my attention was a one-off request for authorization for $4 million for Veterans Affairs targeting advertising. So what we should take from this is that the $4 million was indeed a one-off, it was meant as a one-time payment for a one-time advertising media buy or advertising activity. Would that be fair to say?

[Bill Matthews]

It's for the current year. The advertising is a horizontal item because there are multiple departments that do advertising. Veterans Affairs is the only department with money for advertising in these estimates.

You are quite correct, it is a specialized event in that it is to commemorate the 60th anniversary of the Korean War. Veterans Affairs is planning something specific to commemorate the veterans from that war so that's why you're seeing that in supplementary estimates.

[Gerry Byrne, Liberal, Humber—St. Barbe—Baie Verte, NL]

So in terms of the central agency's process, since that is a one-off item with a sunset, it's for this year and this year only. It didn't necessarily appear in the budget, or would that have been a budget item? I can't recall.