Public Accounts Committee on Nov. 29th, 2012

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

How's my time, Mr. Chair?

[The Chair, NDP, David Christopherson]

It's at half a minute.

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

I'm guessing that policies relating to marketing milk vary greatly from one province to the next. Should those policies be harmonized? If so, what is the CDC's role and what are you doing to harmonize those policies?

[Randy Williamson]

That's a good question.

I suggest that if you went back to 15 years ago, every single province was an individual. They certainly sat at the Canadian Milk Supply Management Committee as a group, but they had their own policies. They classified their milk in their own manner and acted as individuals.

Over the course of the last 15 years, what we have seen is a creation of two pools, a western pool and an eastern pool, the P5. Within those pools what they have done is harmonized a number of things, everything from what products fit into particular classes of milk to rules around their milk collection, and so on, so that they have similar policies.

Over the course of the last two years, the CDC pulled together what we called the P10. It was a group that, at our urging, came out of the CMSMC to bring all of the parties within Canada together into a single pool, a P10 pool, such that we would have an ultimate harmonization of everything across Canada. The rules would be the same and fair for all concerned.

We made some progress in that. Some of the things that have come out of that are this 1% growth allowance, but we have not yet accomplished the bringing together of a P10. We will continue to look at the benefits to pursuing that.

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

Thank you, Mr. Chair.

[The Chair, NDP, David Christopherson]

Thank you both very much.

Over to Mr. Ravignat. You have the floor, sir.

[Mathieu Ravignat, NDP, Pontiac, QC]

Thank you, Mr. Chair.

I'd like to go back briefly to Mr. Hayes' comments on conflict of interest. Honestly, Mr. Williamson, I did not find your answer concerning the measures you have taken to avoid conflicts of interest very convincing. If I look at page 38 of the Auditor General's report, at paragraph 35, it clearly says that the Auditor General has noted that the commission does not have such mechanisms in place with respect to conflict of interest. In addition, you suggest that you are going to have meetings with the Privy Council on the matter of conflict of interest. First, I want to ask you how many meetings you have had with the Privy Council since 2005?

[Randy Williamson]

I don't believe I made any mention of meetings with the Privy Council.

[Mathieu Ravignat, NDP, Pontiac, QC]

In paragraph 36 of the Auditor General's report regarding the commission's response, the last sentence reads as follows:

As we did at the time of the previous special examination, the Commission will discuss this issue with the Privy Council Office in an attempt to find a workable solution [to conflicts of interest].

I simply want to ask you if you have met with the Privy Council Office and, if so, on how many occasions.

[Randy Williamson]

That, I believe, is a reference to coming out of our special examination discussion with the Privy Council relative to their recommendations. They made a recommendation that we take the issue to the Office of the Ethics Commissioner. We have done that. We have received a response from them that indicates that in their opinion we serve a broader public and that the issue of conflict of interest is not a significant one.

Having said that, I think that the OAG will tell you that they believe we still need to pursue other avenues.

[Mathieu Ravignat, NDP, Pontiac, QC]

In sum, you have simply ignored the Auditor General's recommendation. As for conflicts of interest, there is no problem. Is that what you are telling us?

[Randy Williamson]

From a personal perspective, I don't believe there's a problem. I'm saying that precisely, yes....

[Mathieu Ravignat, NDP, Pontiac, QC]

So, let us be clear, Mr.—

[Randy Williamson]

I have not said I don't believe there is a problem.

[Mathieu Ravignat, NDP, Pontiac, QC]

But you have not put in place a specific plan and you have not met with the Privy Council, as was indicated in your report.

[Randy Williamson]

The change that has been made coming out of that recommendation is we changed our bylaws. I made mention earlier that we have put into our bylaws a need for us to make a determination at the outset of every meeting if we believe we have a conflict of interest. That item in the bylaws did not exist prior to the recommendation by the OAG. We made that change.

[Mathieu Ravignat, NDP, Pontiac, QC]

According to you, that plan is sufficient to prevent conflicts of interest?

[Randy Williamson]

It would be a much simpler solution, if you like, if we had a larger board. That would provide us with an opportunity to solve a couple of issues, the skill set being one and the other being a potential issue around conflict.

[Mathieu Ravignat, NDP, Pontiac, QC]

But why have you not developed—because this is a golden opportunity to do so—a detailed plan to avoid conflicts of interest rather than simply changing a rule?

[Randy Williamson]

We do. I'll refer to my earlier comment that the CDC Act indicates we have three board members only.

[Mathieu Ravignat, NDP, Pontiac, QC]

So, you were saying that if you do not change the structure of the board, you cannot deal with the possibility of a conflict of interest in an effective way. I don't see the connection. Can you explain it to me?

[Randy Williamson]

I think we can eliminate the need for expertise in producer background and processor background, and perhaps there would be an opportunity to bring on individuals with a financial background. That would be another avenue, but I'm not sure that it would be in the best interests of the industry.

[Mathieu Ravignat, NDP, Pontiac, QC]

Why?

[Randy Williamson]

I think that it is very important to have a level of expertise relative to production and processing.

[Mathieu Ravignat, NDP, Pontiac, QC]

Fine, but it would be guaranteed with the three members who sit on the board and who are from the industry.