Public Accounts Committee on Feb. 26th, 2008

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Very well.

Mr. Stevenson, when do you intend to present the details regarding the measures taken to ensure that the NORAD buildings can be used for their intended purposes?

[Scott Stevenson]

Yes.

I was not a party to the discussions on this project involving the Office of the Auditor General and the department. If possible, I would like to gather more information on the key questions that the OAG raises in points 1.74 or 1.75.

Nevertheless, I can tell you that the expected cost of construction was $25.3 million. The final cost of construction was $24.9 million. The project's budget covered all construction costs.

Did the budget provide for additional security expenses? If possible, I would like to provide you with that information at a later date.

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Very well.

Mr. Guimont, it was said that the budget for your staff was very unstable and that there was a lack of continuity. It was also said that 12-month job offers were one of the constraints. Do the new contracts exceed 12 months?

[François Guimont]

Until we have a stable funding formula for the program, it will be difficult to establish a multi-year formula. So there will be constraints. Let me be very clear. I want the program to be as stable as possible, but I want to do so within the financial constraints. There has been a new allocation of approximately $6 million, but this, simply put, always impacts other departmental priorities. We of course have to ensure that we have the resources to implement our action plan.

[Marcel Lussier, Bloc, Brossard—La Prairie, QC]

Did I understand correctly? Did you have $11 million? Over what period of time?

[François Guimont]

Basically, there are three figures. Base funding for the program is $6.7 million. Over the past few years, we allocated another $6 million on average within the department. Recently, in September, we received $11.3 million from Treasury Board for the contract security program. There was an increase from Treasury Board, but those funds run out at the end of the fiscal year. On March 31, I will have to find either a long-term or short-term solution to ensure continued progress with the program.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Mr. Lussier.

Mr. Fitzpatrick, go ahead for four minutes.

[Brian Fitzpatrick, Conservative, Prince Albert, SK]

I think everyone knows that assessments and studies can cause serious delays and can definitely drive up the cost of projects and contracts. I am curious about the extent of the process we would use in the certification process. If the department, let's say, were ordering Canadian flags or salt for the salt shakers or something along that line, how much is involved in the checklist process to determine that this really isn't a security issue and let's get on with it? How far are we going to go on the checklist of procedures in the non-sensitive areas? It seems to me we have to allow for some judgment by managers and some common sense in the system, or we could have a real problem.

What are we looking at on this checklist for non-sensitive areas?

[Sheila Fraser]

I absolutely agree that we don't want to burden the system with a lot of unnecessary consideration, but if people are going out to buy flags or whatever, it's pretty clear that there are no security issues there. It's when you get into defence construction contracts, for example, where we noted that for 99% of them there was no checklist done. At a minimum, there could be an indication that someone has considered the security aspects and has made a clear determination that there is no security. Previously that wasn't obvious, and so you didn't know if people had considered the security aspects.

At the risk of getting into a debate, in the NORAD project the security checklist was not completed, and there was no indication about security requirements, and so the people who were doing the contracting wouldn't know what clearances people should have. It's really up to the people who are running the projects to make that determination. Otherwise the people in Public Works, the contracting authorities, have no way of knowing--

[Brian Fitzpatrick, Conservative, Prince Albert, SK]

I appreciate that. With sensitive areas we can all agree on that. I'm just a little bit cautious about making it a government-wide procedure in all government departments. You could really build an empire.

[Sheila Fraser]

It can be a pretty simple thing to do. When we do our own contracting—and you would suspect that in my office we don't have a lot—we have access to protected information. There is just a drop-down thing and people just have to do it. It's not a long process that they have to go through. It's simply checking another box.

[Brian Fitzpatrick, Conservative, Prince Albert, SK]

Auditor General, in all seriousness, if we get into the “what ifs” that can happen—I remember reading an essay about what's involved in the manufacture of a pencil and getting it to market. If we get into all the “what ifs” that are possible in the world, you can create a pretty complicated procedure.

Maybe Mr. Guimont could comment on this area. There has to be some common sense in this whole process too, I think.

[François Guimont]

I very much agree with Madam Fraser. It's not one-size-fits-all, and this is important for committee members to appreciate.

I'll give you an example. If, for instance, someone requires a contract, they require a screening, a reliability check, at the lowest level--protected A--it can be done in days. If I remember, it is three days. It can be a bit more complicated, but it's measured in days. Obviously, to be clear--and this is where Madam Fraser is--if it's run-of-the-mill we can be pretty efficient and therefore not create a burden on either business or capacity for the government to issue contracts.

Where it gets to be more difficult--and this is where the OAG focused--is when you get into the more sensitive files. There, clearly, when we're talking about clearances at a secret or top secret level, we are now measuring progress in months. So this is very different.

It is very important for whoever decides there is a security requirement to make the right call, because if the call is one of top secret or secret, there will be an impact. It's not a negative impact. It's going to be a period of time to do the job correctly.

The majority of so-called screenings taking place for government activity are done at the screening level, which often is done in days. We're talking in thousands. If I remember, going on memory, it's like 50,000 clearances or reliability checks per annum. The workload is measured in days.

I don't minimize that. It has to be done, but I would like to think it is not creating a huge burden vis-à-vis the benefits.

[The Chair, Liberal, Shawn Murphy]

Thank you, Mr. Guimont.

Mr. Christopherson, you have four minutes.

[David Christopherson, NDP, Hamilton Centre, ON]

Thank you, Chair.

For the benefit of members and some of the work we have done, I want to put on the record that a page of the Auditor General's report says there was a review of all the agencies to see if they were doing security checks on contracting, and the only one that was doing it was the RCMP, so we have to give them their due where we can.

This is my second point. Deputy, with regard to your opening comments, I want to tell you how impressed I was, particularly that you caught on to this really quickly, when you were being briefed, as to where your priorities were. You got on top of this before the report was tabled, and you put in your comments, additional steps that you have taken, which is very impressive, and you didn't go out of your way to tell us how wonderful everything is and that this was a minor exception. This was a big deal, and you dealt with it that way. I, for one, am very pleased with the way you have approached this, notwithstanding the grilling we're putting you through today, but given the importance, I think you will appreciate that.

I don't want to belabour this one to death, but there are a couple of little things that concern me.

Major-General, how long was the delay and how much was the cost as a result of that delay, and how much was the cost of the modifications to the NORAD facility?

[MGen Glynne Hines]

What delay are we talking about?

[David Christopherson, NDP, Hamilton Centre, ON]

I'm talking about the delay where the report says, “In the opinion of National Defence, after more than a year of investigations and meetings, it is determined that, with modifications...”. I'm assuming that if you have to have meetings about things, then you have to have modifications and you have to go back and undo work. You wouldn't normally put in your project plan four weeks to go back and fix screw-ups, so I'm assuming this went a little bit over.

[MGen Glynne Hines]

I'm not aware what the timeline was for any delay; however, modifications that are performed and reworking that has to be done are regrettably all part of normal construction practices.

Some things were not put in right. We had cases where the locks were put on the wrong side of doors. We had places where conduit wasn't terminated properly in accordance with either good construction practices or the security rules we put on for the facilities. As you can appreciate, we have to make sure we know where any electrical conduit goes and that it's terminated correctly at both ends, because we're going to put communications or power cabling through that. In some cases it wasn't terminated correctly or there were junction boxes where they shouldn't have been, contrary to designs that had been approved.

So a certain amount of rework was required from a construction practices standpoint and a security standpoint, and that would have been picked up as part of the normal construction activity. The contractor would have been held responsible for fixing those things because they were implementation deficiencies, not design deficiencies.

[David Christopherson, NDP, Hamilton Centre, ON]

So if I'm hearing you correctly, there were no security-related matters that required modifications that were a big deal. You're telling me it was all junction boxes. You're really playing this thing down, so you'd better be prepared to defend it.

[MGen Glynne Hines]

I'm not saying they were all minor. They were what would be considered, on a $25 million construction project, oversights that weren't done correctly and had to be reworked.

[David Christopherson, NDP, Hamilton Centre, ON]

Thank you.

Auditor General, would you agree with that?

[Sheila Fraser]

Chair, if you agree, perhaps we could discuss this with the department. That was certainly not the impression we had when we completed our work, but we have not done a follow-up since then. Perhaps we can work with the Department of National Defence and come back to the committee with a response to that question.

[David Christopherson, NDP, Hamilton Centre, ON]

Am I out of time?

[The Chair, Liberal, Shawn Murphy]

Yes.

Mr. Wrzesnewskyj, you have four minutes.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

Mr. Christopherson's opening comment about the RCMP jogged my memory. It was Mr. Crupi who was bounced out of the RCMP and ended up with the top security clearances that allowed him to work in the Canadian security establishment within National Defence. But let's set that aside.

I'm returning to page two under the heading of “What we found”. You found there was willingness on the part of National Defence officials to circumvent key security-related procedures. That's pretty strong wording, and it's quite clear.

Can you provide us, perhaps in the next two weeks, with a list of circumventions that you became aware of so we can clarify this point?