Evidence of meeting #51 for Public Accounts in the 41st Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was communities.
A video is available from Parliament.
4:15 p.m.
NDP
The Chair NDP David Christopherson
You're welcome.
We're moving over now to Ms. Jones. You, ma'am, now have the floor.
4:15 p.m.
Liberal
Yvonne Jones Liberal Labrador, NL
Thank you, Mr. Chair.
I thank our guests today for their presentations.
As most of you will know, I represent a region of the country that is very dependent on the nutrition north program. All the things we're discussing here today are very relevant in terms of ensuring that we have a sufficient and affordable food supply in many of these communities.
Today I can tell you that is not the case. Despite the greatest efforts that we have seen with nutrition north, we consistently hear from communities and from individuals across the north that food is still not affordable. We saw explicit examples these past few months in the media coming out of the Nunavut region, but out of other regions as well. Consistently, when I travel through communities in my own riding and others across the north, the number one concern for families remains access to healthy food and affordability of the food. We can never undermine that.
We know that food mail was not perfect, but I think we also know now that nutrition north is not perfect. Anytime we can have $60 million to $70 million in a subsidy going into providing healthy food to people in the north but it's still not reaching them and we can't confirm the subsidies are being passed on, then we have a problem.
My question will be on a couple of things. Unfortunately, we don't have time to get into all the things I want to get into, but first of all I want to ask this. There was a contractor hired by nutrition north to complete a compliance review of the program. It was highlighted in the AG's report under section 6.30. There are a couple of things I want to know with regard to that report. Who was the contractor? What information was provided under the compliance review?
We just want to know, for each year: who was hired to conduct these reviews, how much do these contracts cost the department, and why were those inadequacies not picked up in those compliance reviews?
4:15 p.m.
Deputy Minister, Department of Indian Affairs and Northern Development
I don't have the name of the contractor, but I can certainly get that for you.
We do put all the compliance reports online after they're translated, so you'll find the compliance reports online. We have actually done 16 of the 32 recipients, but that represents about 94% of the volume of food that's going up, so it's almost 100%.
I did want to point out that those compliance reviews do look at whether or not the subsidy is being passed on, but the Auditor General has pointed out that they can't always provide the data and the information to establish the basis on which they're making their conclusion. It is in there, and it is indicating...so you can actually get online and read all the compliance reports. Anyone who is in the north can do so.
4:20 p.m.
Liberal
Yvonne Jones Liberal Labrador, NL
Okay.
The other piece with regard to the compliance reports is that they went on from 2011 to 2014, so if there was no way to measure whether the subsidy was passed on, why did the department not make changes? Why did you have to wait for the AG report?
Second, I understand now that there is an RFP to develop a subsidy model to support the engagement of communities in nutrition north and I would ask if there is an intention right now to develop a new model of providing the subsidy to northern regions. If so, have there been any submissions or when do you expect to have those submissions? It's my understanding from this that you are looking a little further down the road at what could potentially be a different model of passing the subsidy along.
4:20 p.m.
Deputy Minister, Department of Indian Affairs and Northern Development
All the compliance reviews we have done since 2011 look at whether or not the subsidy has been passed on and they come to a conclusion about whether it's been passed on or not.
The issue that the Auditor General has pointed out is that the underlying work to substantiate that conclusion is not always evident. I've got one here. It's done by Samson and Associates, so I think that's the contractor on that one. If you look online you can find the contractor for each one.
The beginning is passing on the subsidy; they've been asked to verify the recipient's passing on the value of the subsidy. The review concludes that the recipient is passing on the value of the subsidy to the purchaser of eligible nutrition north in that case. In some other cases they're finding there's not enough data for them to reach that conclusion. The Auditor General has pointed out to us that we need to reinforce and make it absolutely clear that they have to keep the information, that they have to provide it, and we have that specific now in our contribution agreement and in our contracts with the auditors.
4:20 p.m.
NDP
The Chair NDP David Christopherson
Thank you. Sorry, time has expired.
We'll move over now to Mr. Aspin. You have the floor, sir.
4:20 p.m.
Conservative
Jay Aspin Conservative Nipissing—Timiskaming, ON
Thank you, Chair, and welcome to our guests today.
As my colleague Mr. Albas has said, this is a relatively new program, established in 2011, so if you stand back more nutrition is going up north. The cost of the food basket is coming down, so you're meeting your basic objectives of the program. According to the Auditor General, obviously some tweaks need to be made. There's some question about focusing on the need of communities; perhaps that should be tweaked. Also, in terms of accountability, there needs to be some sharpening of the tools. Is that fair in summing up where you're at with NNC?
4:20 p.m.
Deputy Minister, Department of Indian Affairs and Northern Development
Yes, I think that's fair and I think the things the Auditor General has pointed out to us will help us to try to reassure the public that's benefiting from the subsidy that we're doing everything we can to make it accountable and that the subsidy is being passed on.
There is an information gap. There is a lot of concern; prices are high in the north. Nutrition north's objective isn't to make the prices exactly the same as they are in the south. By reducing the prices of perishable nutritious food somewhat, the objective is to provide a subsidy to try to help in that regard. Indeed, we've been trying to make the program as good as we can and that's why you'll find in our action plan some of the things we're proposing over the next little while to make the improvements that we see could help.
4:20 p.m.
Conservative
Jay Aspin Conservative Nipissing—Timiskaming, ON
In addition to the helpful advice and guidance of the Auditor General, you have this NNC advisory board, which is new. Could you identify or elaborate on the purpose of that board and how it would perhaps configure into this arrangement?
4:20 p.m.
Deputy Minister, Department of Indian Affairs and Northern Development
This is one of the changes from the old food mail program. We put in place an advisory board to help advise the minister on all aspects of the program. All the details of their terms of reference are available online on the nutrition north website, so people can read it there.
It consists of up to seven members—I believe there are currently four—and a technical adviser. They're people who represent the north and who live in the north. They meet at least three times a year in person and when they meet in person they have an event that's open to the public, and then they meet by phone fairly frequently as well.
Their objectives are to draw on the experience and expertise of organizations and individuals involved in transportation, distribution, nutrition, public health, government agencies, community development, and retail—it's a long list of those engaged in the provision to northern communities that they're supposed to gather information from—and to advise the Minister of Aboriginal Affairs on various matters, including, but not exclusive to, program performance, communications and public awareness, health and nutrition strategies, transportation systems, food supply chain management, food pricing, and food eligibility.
4:25 p.m.
Conservative
Jay Aspin Conservative Nipissing—Timiskaming, ON
I'm going to interrupt as I have minimal time.
Would they have any influence with regard to helping you with need identification or the type of accountability measures that the Auditor General is suggesting?
4:25 p.m.
Deputy Minister, Department of Indian Affairs and Northern Development
They certainly can help us in trying to identify areas around the levels of subsidy and the types of foods that need it most, what's most needed in the north, and they do meet frequently with the Minister—they met with him in early February—and they provide their views. They are people who live in the north and they provide a good grounded set of suggestions.
4:25 p.m.
Conservative
Jay Aspin Conservative Nipissing—Timiskaming, ON
Okay, and I have one quick question, if I may, Chair.
Why did you change the program from a transportation subsidy to a retail subsidy? I recall you mentioned something about a subsidy being involved with snowmobiles and this kind of thing, but what's the basic reason for that?
4:25 p.m.
Deputy Minister, Department of Indian Affairs and Northern Development
Well, the basic reason was that air transport is the major cost, the reason for the increased cost, but there are a lot of other factors that lead to the high cost of food in the north. Some relate to the size of the communities. They're relatively small. Another factor is hydro power. It's very expensive to keep a store going. Wages are higher because people have a higher cost of living to deal with. World markets trends.... There are all kinds of factors that affect the price. It's not just the cost of transportation alone.
4:25 p.m.
NDP
The Chair NDP David Christopherson
Thank you. The time has expired. You timed that nicely.
Now we go back over to Mr. Bevington. You have the floor again, sir.
4:25 p.m.
NDP
Dennis Bevington NDP Northwest Territories, NT
Thank you, Mr. Chair.
I would like to talk a little bit about the actual monies that were spent on this program. Could you tell me what monies were spent this year, 2014-15?
4:25 p.m.
Deputy Minister, Department of Indian Affairs and Northern Development
I'll ask my colleague to give exact figures.
4:25 p.m.
Assistant Deputy Minister, Northern Affairs, Department of Indian Affairs and Northern Development
We'll be spending just over $62 million for the subsidy component.
4:25 p.m.
Assistant Deputy Minister, Northern Affairs, Department of Indian Affairs and Northern Development
That's the subsidy component. That doesn't take into account the small portion that we provide to Health Canada to allow it to do its nutrition education programming, the dollars associated with the processing of the payments, and a little bit for the advisory board and other overhead.
4:25 p.m.
NDP
4:25 p.m.
Assistant Deputy Minister, Northern Affairs, Department of Indian Affairs and Northern Development
That is about $3 million and change for Health Canada, as a top-up, and that would be about $2 million and a bit for the rest of it.
4:25 p.m.
NDP
Dennis Bevington NDP Northwest Territories, NT
Within the time of the food mail program, we saw the budget go from $33 million to $59 million over a seven-year period. Since the nutrition north program has been in place, the budget has gone from $57 million—it actually dropped the first year of the nutrition north program from $59 million down to $57 million—and it is now at about $65 million total.
So you see, we don't see the rapid increases that we saw in the food mail program over those years. I think you'd see that the percentage is smaller for these last three or four years. Yet at the same time we have two factors that come into play when it comes to the cost of food. One is, of course, the cost of the food. Then with the populations in the communities, there are more mouths to feed. Do you actually do an analysis of what costs are required to maintain a balanced program? It seems that over the years of the food mail program we saw a very substantial increase every year, and I think that's one of the problems we see with this program now. It has fallen behind in the amount of dollars that are available for the kinds of cost increases that are in the system.
Have you done an analysis in that regard?
4:30 p.m.
Deputy Minister, Department of Indian Affairs and Northern Development
I think that's the reason there was an announcement in November about an increase of an amount for the nutrition north program and an automatic 5% escalator. That escalator is based on the increased volume of nutritious perishable food that the subsidy program is supporting. It has been around that amount, partly because of demographics and partly because of people finding that it's worthwhile to buy that food.
4:30 p.m.
NDP
Dennis Bevington NDP Northwest Territories, NT
Well, that announcement in November for 2014-15, according to your calculations, left it at about the same amount as the previous year, 2013-14, where you had spent $63,879,000.
There wasn't really any increase in November. You just simply added the money that you normally add into the program.