Government Operations committee  That's an excellent question. The $16 million is a portion of our contribution from strategic review. Basically it is savings: we are shaving $16.5 million from our appropriation and we are using it to reduce our legitimate ask for cash.

Government Operations committee  That is correct.

Government Operations committee  We are going to replace epass. The initial technology was epass and Bell Canada was the provider. The technology has evolved into the current Access Key, which is still provided by Bell. I have the details here regarding costs, and so on. But the new technology that we are proposing and for which we are asking $16.5 million comes from SecureKey Technologies.

Government Operations committee  That's just one of the phases. The amount of $16.5 million covers the design and development of the technology replacing the current technology. The total cost is $61.9 over six years, which comes to about $10.3 million annually. If we compare this amount to the $24.3 million required for the current technology, we see that we are saving a lot of money with the private sector technology.

Government Operations committee  There is an explanation for the increase in subcontracting. But I would like to make a clarification. Under no circumstances does Public Works and Government Services Canada hire subcontractors at the expense of public servants. Subcontractors are hired either when there is a fixed project period or when specialized expertise is required.

Government Operations committee  A few factors come into play. First, as you know, we have been very involved in Canada’s Economic Action Plan. That is no longer underway now. Another factor is inflation, which varies over the years. There has also been a change in how we account for subcontracting. One part of Public Works and Government Services uses services from another part of the department.

Government Operations committee  Thank you for the question. There are certain legitimate transfers that appear under Treasury Board Secretariat and are transferred to PWGSC--for example, termination benefits, maternity leave, and severance pay. That accounts for about $30 million. Another $30 million, $40 million is due to....

Government Operations committee  Because, year over year, departments don't spend their full operating budgets, they are entitled to report the following year, up to 5%. Public Works' share this time is $30 million, which we had access to. That was reported from the previous year to this year.

Government Operations committee  It is on page 20---

Government Operations committee  --of the supplementary estimates (B). It is in the second column called “Permanent Allocations from TB Central Votes”.

Government Operations committee  Thank you, Mr. Chair. Members of the committee, good afternoon. My name is Alex Lakroni, and I am the Chief Financial Officer at Public Works and Government Services Canada. With me are John McBain, Assistant Deputy Minister of Real Property Branch, and Pierre-Marc Mongeau, Assistant Deputy Minister of Parliamentary Precinct Branch.

Government Operations committee  I will defer to my colleague, John McBain, who's aware of the infinite details. But we've done the analysis, both the engineering analysis and the financial analysis, and the findings are that this deal is an outstanding deal. I will let John McBain comment on the details.

Government Operations committee  Thank you for the question. There are two reasons for the increase in the capital vote. Reason number one is the purchase of the Nortel building, which we talked about. The second reason is that Public Works is managing the economic action plan, $200 million in this fiscal year.

Government Operations committee  It is a program over two years. It means an influx into the PWGSC budget of $200 million for 2009-10 and 2010-11.

Government Operations committee  Mr. Chair and members of the committee, good morning. My name is Alex Lakroni, and I am the Chief Financial Officer at Public Works and Government Services Canada. With me is John McBain, Assistant Deputy Minister of the Real Property Branch. We appeared before this committee to discuss supplementary estimates (B) on November 25, and we are pleased to return today as part of your review of the supplementary estimates (C), which were tabled in the House of Commons on February 28.