Evidence of meeting #33 for Public Accounts in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was economic.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

  • Ronnie Campbell  Assistant Auditor General, Office of the Auditor General of Canada
  • David Enns  Deputy Assistant Secretary, Expenditure Management, Treasury Board Secretariat
  • Rick Stewart  Assistant Secretary to the Cabinet, Liaison Secretariat for Macroeconomic Policy, Privy Council Office
  • Taki Sarantakis  Assistant Deputy Minister, Policy and Communications Branch, Infrastructure Canada
  • Natasha Rascanin  Assistant Deputy Minister, Program Operations Branch, Infrastructure Canada
  • Robert Dunlop  Assistant Deputy Minister, Science and Innovation Sector, Department of Industry
  • Douglas Nevison  General Director, Economic and Fiscal Policy Branch, Department of Finance
  • Elisha Ram  Director, Microeconomic Policy Analysis, Department of Finance
  • John Affleck  Principal, Office of the Auditor General of Canada
  • Clerk of the Committee  Ms. Joann Garbig

9:25 a.m.

Liberal

Gerry Byrne Humber—St. Barbe—Baie Verte, NL

Thank you, Mr. Chair.

The messaging on this particular program seems to be coming here to this committee as a bit of a moving feast. If specific, short-term, immediate-impact jobs were not necessarily the entire end goal, if there were other values that had been equated into the overall evaluation and assessment of projects.... I want to this to be very specific to you, Mr. Sarantakis. Why wasn't the G-8 legacy fund, the $50 million that was approved by Parliament through the border infrastructure fund, incorporated within the overall scope of the community infrastructure program? Would that have been a better program to fund that $50 million initiative?

9:25 a.m.

Assistant Deputy Minister, Policy and Communications Branch, Infrastructure Canada

Taki Sarantakis

I'm not sure I understand your question.

9:25 a.m.

Liberal

Gerry Byrne Humber—St. Barbe—Baie Verte, NL

You used the border infrastructure fund, which was part of the overall economic strategy, the economic action plan, but what you did not do is.... You're now creating an environment here for the committee that in addition to short-term jobs, there was also long-term value that was created. You have not defined for Parliament any of the assessment criteria you used for that overall assessment.

I'll bite now on what Mr. Campbell asked us; I'll get more directly to the suggestion that Mr. Campbell made. When are you going to provide Parliament with an overall evaluation of the jobs that were created and the economic impacts that were provided by this program?

Mr. Campbell, you had no opening comments whatsoever to make in rebuttal to the Office of the Auditor General, so you agreed with the Office of the Auditor General's comments, in everything they put in their report. You have not yet provided Parliament with a specific and descriptive analysis of what criteria you used to determine eligible projects and what criteria you have used to determine the number of jobs. The government continually suggests that thousands of jobs have been created here, using absolute figures, absolute certainty that the program met its key objectives.

When are you going to provide that analysis?

9:25 a.m.

Assistant Deputy Minister, Policy and Communications Branch, Infrastructure Canada

Taki Sarantakis

Perhaps I'll start and then I'll turn it over to my colleague at the Department of Finance.

The stimulus programs were designed, as we noted, to be timely, targeted, and temporary. So the primary objective of the program was to generate economic activity rapidly. That being said, it wasn't just money being thrown away; it was money that was spent on infrastructure. Ancillary benefits of that were to create longer-term jobs.

With respect to reporting, my colleague from the Department of Finance has already noted that there have been seven quarterly reports to Parliament, but there's additional.

9:25 a.m.

General Director, Economic and Fiscal Policy Branch, Department of Finance

Douglas Nevison

Thank you.

Just to follow up on your question, as I mentioned, in terms of tabling to Parliament, both budget 2009 and budget 2010 had the methodology for the jobs estimate that I mentioned, using the macroeconomic model. That methodology has been presented to Parliament on two occasions. It's also been elaborated in the reports to Canadians that I mentioned.

Coming back to the Office of the Auditor General's recommendation, which the Department of Finance and the government agree with, once the information is in place that a final economic assessment can be undertaken, that will be tabled as well and it will use the same methodology that we've mentioned--a macroeconomic base so we can look at the entire range of job creation impacts, not just at the direct project level.

9:30 a.m.

Liberal

Gerry Byrne Humber—St. Barbe—Baie Verte, NL

Thank you.

I'll ask Mr. Campbell, then. You suggested to us to specifically ask our witnesses about what were the plan and the timeframe for reporting to Parliament on the delivery and economic impact of the economic action plan. What specifically have they left out that you suggest they need to be more forthcoming with?

9:30 a.m.

Assistant Auditor General, Office of the Auditor General of Canada

Ronnie Campbell

I think the only thing I missed there was a date.

9:30 a.m.

Liberal

Gerry Byrne Humber—St. Barbe—Baie Verte, NL

A date?

9:30 a.m.

Assistant Auditor General, Office of the Auditor General of Canada

Ronnie Campbell

I didn't hear the government say on what date or approximately what date they intended to table the report that assessed the impact of the economic action plan.

9:30 a.m.

Liberal

Gerry Byrne Humber—St. Barbe—Baie Verte, NL

Mr. Chair, if there is time, would the witnesses be able to provide a date?

9:30 a.m.

NDP

The Chair David Christopherson

You have 15 seconds to try to get it out of them.

9:30 a.m.

General Director, Economic and Fiscal Policy Branch, Department of Finance

Douglas Nevison

No date's been determined. As I said, we're still looking at the most recent information we received. Once we feel this information has been verified, then the decision will be taken on when the report will be released.

In terms of a particular date, we do know that the spending information for the four infrastructure funds that were extended will be presented in the public accounts, which will be released in the fall of 2012.

9:30 a.m.

NDP

The Chair David Christopherson

Thank you. Your time has expired.

Moving now to Madam Bateman, you have the floor.

March 13th, 2012 / 9:30 a.m.

Conservative

Joyce Bateman Winnipeg South Centre, MB

Thank you very much.

Thank you all for being here. I appreciate your perspectives. I so appreciate that this was a collaborative effort and that this was an investment in the future of Canadians and it was made possible through the elasticity—you spoke about how you merged the policy elements.

Everybody did extra, and the result is that Canadians were incredibly well served. I was on the outside looking in when this happened, unlike some of my colleagues who were members of Parliament at that time, and as Jane Q. Citizen, I was impressed with the bureaucracy and the alacrity they showed. That came out loud and clear in everything I heard about it.

There's something I heard today I'm really interested in. Well, there are a few things.

By the way, compliments also to working in partnership with your provincial and territorial colleagues. I may get to that question as well, but first I heard from Mr. Nevison about the macroeconomic models you're using; it's rare for a chartered accountant to be interested in macroeconomic models, especially when so much audit stuff is going on. Could you elaborate on that? I think that's really important for us to hear. It's a way of extrapolating the results, and you were only able to touch on that in your response to another colleague. If you could take a moment, I would appreciate that.

9:30 a.m.

General Director, Economic and Fiscal Policy Branch, Department of Finance

Douglas Nevison

I'd be happy to.

As I mentioned, even though data was gathered at the project level, there was a feeling early on, based on previous experience and experience in other jurisdictions as well, that it's very difficult to get consistent job numbers across such a wide range of projects and project proponents. As I mentioned, using that bottom-up information doesn't capture things such as the indirect job impacts from a particular project. That would be the suppliers that the project proponent is subcontracting to or buying supplies from. An economic impact and job impact goes along with that.

There are also the induced effects. As economic activity is elevated in a particular region, incomes go up, and that has a positive impact on economic activity in terms of income.

Finally, as I mentioned in my earlier comments, there is also the important fact that the economic action plan wasn't entirely project-based. There were some very important elements, particularly in employment insurance benefits, for example, tax reductions that spread to the entire economy, so they couldn't be measured on a project-level basis.

Based on those criteria, we determined that the best thing to do in terms of determining the job impact of the economic action plan was to use our macroeconomic model. It has multipliers in it for each individual element of the plan, whether it be infrastructure, EI measures, or tax reductions. This multiplier gives you a sense that every dollar invested or a reduction tax has a certain impact on the economy in terms of GDP. The model can then translate that into an employment impact.

As I mentioned, we've used that approach throughout the process. We've tabled three particular assessments on the job impact. Our most recent was in January 2011 in the seventh report, and it was determined that the economic action plan created or maintained 220,000 jobs.

Obviously the Canadian economy has created much more employment than that since the trough of the recession. I think somebody mentioned 610,000 jobs since July 2009.

This is a way of isolating the impact of the action plan itself. A similar approach was used in the U.S. by the U.S. Congressional Budget Office, based on similar findings from the U.S. Government Accountability Office. They said they had the same issues with the project-level job information they received through their American Recovery and Reinvestment Act.

Finally, it was also validated by three private sector economists here in Canada to make sure that our multipliers were on the prudent side, relative to other models that were being used in other jurisdictions.

In a nutshell, that's the way we've approached it to get a sense of the overall impact of the economic action plan, not just the bottom-up approach.