Canadian Heritage Committee on April 27th, 2009

[The Vice-Chair, Liberal, Pablo Rodriguez]

Thank you, Mr. Bruinooge.

We'll go back to the Liberal Party. Mr. Bagnell, for five minutes.

[Larry Bagnell, Liberal, Yukon, YT]

Thank you.

As official opposition critic for the north and member of Parliament for the Yukon, I can tell you that many northerners--4% francophone--love the CBC, and not only from this side of the House but all across the north. A lot have told me that they don't want advertising on the CBC.

I have a lot of questions. You don't have to have long answers.

First, I'd like to go back to what you said in your opening comments:

CBC/Radio-Canada must remain firmly rooted in the regions. We play a pivotal role in the social, cultural and democratic life of this country, and we cannot do that unless we're in Canadian communities.... And it will remain a priority for us as long as I am President and CEO of CBC/Radio-Canada.

The AM tower is about to be removed for radio in the Yukon. People depend on CBC there, unlike in other areas in the south. Because of the remoteness and the minus 50 degrees, weather reports--for survival, for daily jobs--are really critical things in life. Staying in the regions would not be maintained if this tower were not replaced. The local manager is doing a great job, but he says he does not have the resources to replace that.

I hope you will take this under advisement. I know you probably can't answer now, but hopefully we'll have an ally in you to get this service extended. Those people outside the boundaries of FM really depend on it. They're the most vulnerable.

[Hubert T. Lacroix]

If your question is what will I do about this, I will take the question under advisement. I'm not aware of the details surrounding this tower.

[Larry Bagnell, Liberal, Yukon, YT]

And I hope you'll be an ally as we fight for this to be replaced.

There was at one time a northern CBC radio reporter in Ottawa. I've got great resources in the regions, but...in Ottawa. Before that, a lot of northern issues weren't covered on national radio. They were missed. But as soon as Josée Bellemare came here, all of a sudden there was a dramatic increase. It was a great move. Unfortunately, she got another job.

I'm hoping you'll make that position full-time and permanent, because it certainly increased coverage for the northern geographical half of the country. It was a great asset. That was only one employee, and I'm sure you have hundreds, if not thousands, of employees. It was a great investment for the north.

[Hubert T. Lacroix]

Okay. I'm listening, sir.

[Larry Bagnell, Liberal, Yukon, YT]

I just hope you'll consider making that position full-time and permanent.

[Hubert T. Lacroix]

I'm sure you realize that these questions are questions that we have great senior executives on our team looking at right now. We're trying to understand the impact of 800 jobs on our company. We have programs right now in place to try to generate some financial flexibility.

As I have been saying, one of the first things I'm trying to do here is to create some margin so that we can reinvest some dollars in the regions and in the people in the regions.

[Larry Bagnell, Liberal, Yukon, YT]

I want to get it clear on the money again. In each of the last three years, in constant dollars, meaning constant for inflation, and taking out the 1.5% increase you have to give for employees because of Treasury Board and natural increases, have your programming funds been increased or decreased in each of the last three years?

[Hubert T. Lacroix]

The numbers that I have in front of me, with respect to our parliamentary appropriation, are the following. If you look at the nominal dollars that we had in, say, 2004-05, it was about $1.37 billion, then $1.98 billion, then $1.114 billion. These numbers are all numbers that are taken out of our annual reports, so there are no surprises here.

What I think I said in answer to one of the questions before is that our appropriation has been stable. What we have an issue with is, obviously, when you look back on the appropriation since the appropriation of, say, the middle of the 1990s, we're looking at about $390 million less in constant dollars. That's the issue we have been raising because we're losing ground on a yearly basis with respect to the value of the resources that we have.

[Larry Bagnell, Liberal, Yukon, YT]

If you only take the programming resources, have they increased or decreased in the last three years?

[Hubert T. Lacroix]

The programming resources?

[Larry Bagnell, Liberal, Yukon, YT]

Money for programming.

[Hubert T. Lacroix]

There's a $60 million one-off amount, which Madam Lavallée referred to a few seconds ago, that the government, since 2000, has been giving to us. We have to ask for it and request it on a yearly basis. But the appropriation comes to us and then we allocate the dollars according to our priorities.

[Larry Bagnell, Liberal, Yukon, YT]

Would you say you've been forced into a bad position in selling assets in a recession, when the prices are lower, and it's not very fiscally optimal for Canadian taxpayers?

[Hubert T. Lacroix]

What we are trying to do right now is make the most of a really bad situation. We have a recession. We are trying to use the assets that are least likely to be affected by the recession in trying to generate $125 million of cash. We'd like to think that we're going to do this and we're going to preserve taxpayers' money in the best way we can.

[Larry Bagnell, Liberal, Yukon, YT]

Thank you.

[The Vice-Chair, Liberal, Pablo Rodriguez]

Thank you, Mr. Bagnell.

Mr. Pomerleau, the floor is yours.

[Roger Pomerleau, Bloc, Drummond, QC]

Thank you, Mr. Chair.

Thank you, Mr. Lacroix. I much appreciate all of your comments and your presentation, but some of the things you said pleased me more than others, particularly those comments that seemed to me to be the crux of your argument.

On page 1 of your document, it is stated that:

We play a pivotal role in the social, cultural and democratic life of this country, and we cannot do that unless we're in Canadian communities. This is how we ensure that the issues and challenges people face in one community are heard and shared by people living across the country.

However, the key phrase that sparked my interest is the following:

That identification with the lives of people in other communities is the very essence of a national identity.

I am a sovereigntist, but if I were a regular Canada who wanted Canada to be set on solid ground, I would take that sentence at face value. It seems to me that national identity is at the heart of a nation. If you cannot ensure it by investing the funds needed, where does that leave us? I am not here to defend Canada, but I feel the question needs to be asked.

You are asking for additional resources in order to carry out your mandate. You are facing a budget shortfall because your revenues are declining. Industrialized countries around the world have decided, given the economic crisis, to make massive investments in the labour market to stimulate the economy. Countries are investing hundreds of millions of dollars, hundreds of billions even, to support the economy and the labour market, in order to minimize the number of job losses. Some 800 jobs could be lost at your corporation. There is no funding to compensate for these losses. Instead, millions of dollars will be invested to build bridges, roadways and ports, basically in infrastructures. I have nothing against that, but I believe that culture is worth at least the price of a bridge. I know of bridges costing $800 million. However, for there to be investments made in culture, you need collective, political will. That is why my question springs from the following comment, which can be found on page 5:

[...] we need a new contract with Canadians, a memorandum of understanding that would clearly lay out Canadians' priorities for their public broadcaster and the resources necessary to fulfill those objectives.

Would this not be a way to get Canadians or their government to reinvest in culture? That is precisely where the fundamental problem lies.

[Hubert T. Lacroix]

Mr. Pomerleau, I would just like to correct one comment you made, if you don't mind. I did not come before the committee today to ask you for additional funding. I would remind you that we have a mandate that is very different from the mandate of the other broadcasters who have sat in these chairs before you over the past 10 days. They told you how their economic model was no longer working. Our own economic model is not working either, but what I'm driving at here is that the solutions that you are alluding to are the same as those for the private broadcasters that you have met with, namely local programming, the Media Fund and the infamous fee-for-carriage. You have heard this message for 10 days now.

Today, CBC/Radio-Canada is telling you this: if you want us to continue offering services to Canadians, do not exclude us from these funds. Just because we were allocated $1.1 billion, that does not mean that we are able to provide all the services that you are asking us to provide under the Broadcasting Act. This is the message I am trying to convey to you. That is why, on the first page of my brief, I said that I want you to understand the range of our services, the trouble we are having providing these services to Canadians and the importance of the memorandum of understanding as well as conversations about the MOU. We want Canadians to understand our services and we want to meet their expectations.

[Roger Pomerleau, Bloc, Drummond, QC]

I see.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

What does CBC/Radio-Canada need to save these 800 jobs?

[Hubert T. Lacroix]

We would have to get the dollar equivalent of the cost, in the form of ongoing funding. If we are to keep employing these 800 people, we can't lose this funding next year, so it has to be ongoing funding.

[The Vice-Chair, Liberal, Pablo Rodriguez]

Thank you very much.

Thank you, Mr. Pomerleau.

Mr. Uppal, you have five minutes.

[Tim Uppal, Conservative, Edmonton—Sherwood Park, AB]

Thank you, Mr. Chair.

Thank you, Mr. Lacroix, for adding to this very important study that we're doing here.

My questions come mostly from constituents. We had a number of phone calls and e-mails on this issue in my riding of Edmonton—Sherwood Park, mostly because of the economic situation that's happening right now. It's been quoted in the media that Sylvain Lafrance, the CBC's executive vice-president for French services, racked up more than $80,000 in just one year in expenses such as theatre tickets and hotels, including $6,000 on lunches, and $10,000 at a $1,000-a-plate fundraiser, which prompted a written response from our minister.

Then we come to find out last Wednesday, from a number of Sun Media articles, that again, in just one year, the CBC spent at least $61,000 on nine meetings between January and June. Those expenses include $21,600 for 21 human resources managers and executives to stay at the Château Beauvallon in Mont-Tremblant, Quebec, for two days; almost $3,500 for meetings at the Renaissance hotel in Toronto for senior television managers; over $18,000 for a half-day conference at the Casino du Lac-Leamy; just over $6,000 for a luxury retreat in the Laurentians for 22 executives at Manoir Saint-Sauveur; over $1,600 on a dinner meeting; over $3,500 a day at St. Andrew's Valley Golf Club in Toronto; and another $1,500 for meetings at Hotel Le Germain--and this is on top of bonuses for the fiscal year 2007-08, which topped out at almost $964,000 for 12 executives.

You could see why constituents were concerned. I know spokesmen for the CBC say that these spending practices are in line with corporate policy, and they've said that when face-to-face meetings are required, off-site meetings are usually better to avoid disruptions.

Do you think that the spending of close to $150,000 for nine meetings is good corporate policy?

[Hubert T. Lacroix]

The numbers you're referring to, sir, are 2006 expenses. We're in 2009. Let me tell you what I've done since I've arrived. You are referring, though, to an important point: the use of taxpayers' money. I respect that a lot, and we are very well aware at CBC/Radio-Canada of the importance of using these funds smartly.

I came in on January 2, 2008. Our policies are now organized as follows: all of the expenses of our senior executive team members go through me; my expenses go to the chair of the board of directors; the direct reports of our senior executive team members are also vetted, all of their expenses, through them; and on November 24, 2008—I'll remember the date for a long time, because that's the e-mail I sent out when we were trying to cut expenses—we froze all discretionary expenses.

At the end of the day, our monitoring of these expenses right now is, I think, very solid monetarily. But I have to tell you also about meetings. We are a company that is in ten provinces plus the north. We have 10,000 employees, 553 managers. We want to bring these people together in normal business practices on a regular basis doing smart things. So we are going to continue holding these meetings. It's important for our team. We are in 80 locations. They have to be at one point in time in the same room—not all of them, but we think this is important to making sure we use the taxpayers' moneys to the best use.