Evidence of meeting #20 for Canadian Heritage in the 40th Parliament, 3rd session. (The original version is on Parliament’s site, as are the minutes.) The winning word was program.
A recording is available from Parliament.
Conservative
The Chair Conservative Gary Schellenberger
Welcome, everyone, to meeting number 20 of the Standing Committee on Canadian Heritage. Pursuant to Standing Order 108(2), this is a study on the funding of festivals by Industry Canada.
Here today are witnesses from the Department of Industry: Richard Dicerni, deputy minister, Marie-Josée Thivierge, and Marcie Girouard.
Would you go ahead, Mr. Dicerni?
Richard Dicerni Deputy Minister, Department of Industry
Thank you.
Good morning. I'll say a few words, take about four minutes, and then be open to questions.
Marie-Josée Thivierge is the Assistant Deputy Minister in charge of this program, and Marcie Girouard is the Executive Director of the Program.
The marquee tourism events program was announced on January 27, 2009, as part of Budget 2009. The budget allocated $100 million over two years to this program.
In early February 2009, Industry Canada was given the responsibility to design and deliver this new program. The program was developed with two characteristics in mind: one, it had to be timely, and two, it was temporary.
Given the number of events that were scheduled to take place in the spring and early summer of 2009, it was necessary to quickly secure the appropriate authorities from cabinet and Treasury Board to establish an administrative team and develop the program's terms and conditions, including the eligibility criteria. These efforts led to the program being launched on April 6, 2009. The full details of the program's criteria are available on the department's website.
Program results. In the first year, 165 applications were received; 60 events in 26 cities were funded, for a total approved funding of $47.5 million, including $1.2 million in funding for two-year projects. In the second year, 131 applications were received; 47 events in 35 cities were funded, for a total approved funding of $39.2 million.
On May 7 of this year, when the Minister of Industry announced the 2010 recipients, he also announced an investment of $8 million for the Canadian Tourism Commission. This additional funding has been allocated to the Canadian Tourism Commission to capitalize on the great success of the Olympic and Paralympic Winter Games in key international markets.
The Canadian Tourism Commission is well-positioned to use this investment to attract international tourists and generate increased tourist revenue throughout the country in years to come.
A small amount of funding remained in each year, and that was earmarked for program administration costs.
Thirdly, in terms of the process to review the applications, program officials carried out a number of due diligence activities. These included ensuring that the applications were complete, that eligibility requirements were met, and that the requested funding was within the funding limits based on financial information submitted by the applicants. For example, applicants were required to demonstrate how they met all eligibility criteria. They had to submit audited financial statements from the previous iteration of the event. They had to submit a letter from the chairperson attesting that the board of directors supported the proposed project and would ensure that the project adhered to the program requirements.
We also looked at funding requests, ensuring that maximum program funding was restricted to 20% of the event's previous year's cash operating budget, up to a maximum of $3 million per year for tier one applicants, which were the larger festivals, and up to a maximum of $1 million per fiscal year for tier two, the smaller festivals and events.
The program funding was to be devoted to additional costs, incremental activities, associated either with new activities or with improved or expanded activities.
In our review process, we also used the skills and expertise of other government departments and agencies, such as the Department of Canadian Heritage and regional development agencies, as well as of representatives from the private sector who are familiar with the tourism industry and the festival and events industry.
After officials ensured that all applicants met the eligibility criteria of the program, projects were submitted to the minister, who made the final funding decisions.
Mr. Chair, this represents a very brief overview of the marquee tourism events program, which was announced in January 2009. We look forward to answering any questions you and other committee members may have. We have kept opening remarks deliberately short because our experience in front of various parliamentary committees is that members much prefer to ask their questions to elicit the information they have rather than listening to officials share all of the knowledge that we have.
Conservative
The Chair Conservative Gary Schellenberger
Thank you very much.
The first question is for Mr. Rodriguez, please.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Thank you, Mr. Chair.
Thank you for being here this morning. Thank you also for limiting your comments. That means we can go into more detail in our questions.
So we can understand better, I am going to talk about some concrete examples of events. We will depart from the theoretical framework of the program and talk about specific cases.
In the case of the FrancoFolies de Montréal, were you satisfied with the results in the first year?
Deputy Minister, Department of Industry
The evaluation is underway. We have asked all recipients to provide us with an economic impact analysis. I don't know whether the analysis has been completed for that event in particular.
Do you know?
Marie-Josée Thivierge Assistant Deputy Minister, Small Business and Marketplace Services, Department of Industry Canada
It is underway.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Right.
The people at FrancoFolies are satisfied that they achieved the objectives that were set. I talk to them regularly, and they tell us they have a good relationship with you. They were expecting that funding would be renewed. Why did they not receive funding this year?
Deputy Minister, Department of Industry
A number of applications were made, and ultimately, a certain number of new projects were selected, as well as a certain number of projects that had been sponsored the first year.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Did your rules change in the interim? The Minister said afterward that it would be limited to two projects per large city, that there would be regionalization. Did those rules change?
Deputy Minister, Department of Industry
The rules for the eligibility of projects and the eligibility of activities have stayed the same from one year to the next. That explains in part why some projects, like the Montreal International Jazz Festival, were selected.
As the Minister said, for this second year of the program, to increase the regionalization of the program, we adopted the guideline of having a maximum of about two activities per city.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
The FrancoFolies people didn't know that. It wasn't in the rules. When they submitted their application, they had no knowledge of that. That's what they told me.
Deputy Minister, Department of Industry
What we review are the activities, the eligibility of what is proposed. For the number of projects, there were discussions about that, and ultimately the Minister decided to aim for greater regionalization.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
I understand. However, and you will certainly agree with me, when a project is submitted, when resources and time are spent, when people invest in it and try to do it with full knowledge, that is, with knowledge of the rules. The FrancoFolies people tell me, and they are not the only ones who say this, that they were not aware of this business of two major projects per city.
It's as if the rules had been changed or improvised at the last minute, without informing the people making the applications. It came as a surprise to everybody. Is that in fact the case?
Deputy Minister, Department of Industry
I think that when the decision was made public, it may have come as a surprise to some groups.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Since the rules in general haven't changed, apart from the rule about two projects per city, the FrancoFolies festival would have qualified this year. But since you or the Minister have decided to have only two projects per major city, some events did not receive funding and did not know the rules that led to them being refused or disqualified.
Deputy Minister, Department of Industry
It isn't necessarily a question of disqualification. There were a lot more projects submitted than the budget could satisfy.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
I understand, but if they met the criteria the first year, if everything went well, they provided good reports, they submitted essentially the same thing, they are credible, the event attracts tens of thousands of people from around the world, those are good partners for you.
But in the case of the FrancoFolies festival, it was rejected and they got a refusal just before the clock struck midnight. You know as well as I do that an event like that takes lengthy preparation. You have to reserve the halls, the technicians, there are performers who come from around the world, there is promotion to be done, and so on. In this case, why did the FrancoFolies organization learn a month in advance?
Deputy Minister, Department of Industry
On our forms, we were very careful to point out that until a decision is made, we encouraged sponsors of these projects to be prudent. I understand that it put them in a somewhat difficult situation, but as I say, our forms were quite clear on that. Until there is a decision, until an announcement is made, there is no government commitment.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
But you know it is impossible to react at the last minute, a month before the event is held. I understand the element of prudence, but there is a limit to prudence. A month in advance, you have to have reserved the halls and the performers by then. So the organizers had to do that, and what they did was responsible. But it caused them a lot of problems then.
Thank you.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Thank you.
Good morning, everyone.
What is reprehensible here is that there were criteria applied after the fact. Nobody knew about the two new criteria that have been mentioned. I have read the entire program guide, myself. It is extremely interesting. You learn a lot of things. All the criteria are there. There is even one that says, and in fact, it isn't a criterion, it's a definition, that a marquee tourism event must have a long tradition. So all the criteria are there, except for two new ones that suddenly, after the fact, excluded the FrancoFolies de Montréal, the fact that there can't be more than two projects per city and the fact that there has to be regionalization. Those criteria do not appear anywhere in the guide.
It is unfair to invent new criteria after everyone has made their applications. If those criteria had been known, probably the three big festivals in Montréal, with Just for Laughs and the Montreal International Jazz Festival, would have got together, would have agreed, or would have competed.
You say the Minister invented these criteria. That is what you said. In fact, that corresponds to page 4 of the guide, which says that funding applications have to be approved by the Minister of Industry. I understand, and you can tell me whether I understand correctly, that there were new applications and the Minister decided what activities he wanted to fund or not, using entirely subjective, ideological and political criteria, against the FrancoFolies, against the francophone community, against the Toronto gay community, against things with which he doesn't particularly agree. It makes no sense.
You had $12 million left over. Now you are telling us that you have sent $8 million to the Canadian Tourism Commission. Where does it say, in the January 2009 press release, that you would be sending $8 million to the Canadian Tourism Commission? It has no shortage of money. There is money there. What is the tourism commission going to do with that money? These decisions seem to be reprehensible. It is as if, for example, I invented a new criterion to say I will not allow you to respond.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
But I'm going to allow you to respond since I haven't invented any new criteria.
Deputy Minister, Department of Industry
You have said quite a few things. First, I don't think I used the word "invent" when I talked about the two-year period.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
You said "decided", "the Minister decided", that's what you said. We can review the blues.
Bloc
Deputy Minister, Department of Industry
As well, you made a lot of comments about the reason behind that decision, the merits of it, and added adjectives like "ideological" and all that.
I simply want to tell you that as an official in the department, that isn't part of my role, but I should distance myself from it a bit.
Third...
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
All my apologies, but you know, we have only five minutes, and sometimes we have to interrupt the witnesses.
If the decisions are not ideological or political, what was it that made you choose to fund the Montréal festivals that were funded? Assume that you had several festivals to fund, a whole pile of festivals in Montréal, and using a new criterion, the Minister decided that he would fund only two of them. What was it that made you choose those two rather than any other one?
Deputy Minister, Department of Industry
You said the decisions were political. Ultimately, all decisions are political, whether they be decisions made by the department to support the Knowledge Infrastructure Program, where we have supported the construction, the rebuilding of a particular [inaudible—Editor]. Those were political decisions.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
All my apologies for interrupting you again, but I would like you to get back to marquee tourism events.
When you had the whole pile, when you still had money and you knew that the choice was for only two festivals, why did you choose the ones you chose and exclude the FrancoFolies de Montréal and the Montreal High Lights Festival? Why? What criterion did you use?
Deputy Minister, Department of Industry
I am noting the questions you're asking me and I'm trying to answer, but you keep adding more. So...
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Answer the last one. Because the others were not really questions; they were comments.
Deputy Minister, Department of Industry
Right. You referred to the CTC, the Canadian Tourism Commission, and you asked why it got the $8 million. The government decided to take advantage of the extraordinary success of the Olympics. So in order to achieve tourism objectives, it topped up funding for the Canadian Tourism Commission by about $8 million so it could go and solicit more tourists in the international markets and have a more long-term effect.
That is a choice the government made. Don't forget, this program is part of a framework to promote the tourism industry, to bring more people to Canada.
Conservative
The Chair Conservative Gary Schellenberger
You'll have another opportunity.
I'm going to go to Mr. Del Mastro right now.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Thank you very much, Mr. Chairman.
And thank you, witnesses, for coming today.
We're not having a very honest debate here today about the amount of support this government is in fact providing to significant events. I was just watching the news last night and I saw that the Formula 1 race is coming into Montreal. I think it's some $75 million in support that's bringing the Formula 1 back to Montreal.
I don't think there's any question that this government is providing significant support to major cities to draw tourism and to create economic activity in the country.
I think you'd probably agree with me that to pull a single event out and ask why that event didn't get money, when you're not looking at the entire package of what the government is actually trying to accomplish, which is balance, which is to pick the very best, what we figure the best value for money is...
Would you agree that there is a balancing that needs to occur across the country and that every effort is made to ensure that there's regional fairness in programs like this?
Deputy Minister, Department of Industry
I would agree that indeed choices have to be made. It is the essence of being in government that you make decisions, you make choices. The government supports the tourism industry through a variety of mechanisms, through a variety of programs, and a variety of agencies.
I believe what you were referring to, in terms of the Grand Prix, is that the Quebec economic development agency was a key player in contributing to this event's coming back to Montreal. Other regional agencies also contribute to tourism.
The government made a choice, given the extraordinarily successful Olympics, to redeploy some of the money that it had allocated for one program to the Canadian Tourism Commission in order to enhance the marketing reach, the marketing penetration.
So choices were made. There were choices made in terms of which projects receive government support and where to spend the money, all in aid of enhancing the tourism economy.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Obviously, in my position I hear from groups across the country, but I also hear from people in my riding. I clearly see that an effort has been made here for money to be... This is a temporary program, and I really think it's important that members across the way and groups across the country understand that this is a temporary program. So next year, I don't want to have a meeting about how important the program was to talk about the need to re-establish it, because we've always been clear that it's a temporary program.
But it looks as though every effort has been made to more broadly distribute the money and get it into more regions. Frankly, I think that's a good thing, because I can tell you that in my riding last year... Yes, I heard from major festivals across the country, but I heard from groups in my riding who told me that they'd never qualify for this program, and that even though money was being spent, “We have festivals, we're a tourism region, but we're not going to qualify for any of it.”
So I think an effort has been made to more fairly distribute the money across the country. I think that's a good thing.
Speak to the intent of capping it. Obviously, by capping it you've been able to get more money to more parts of the country than you did in the first year. Is that not accurate?
Deputy Minister, Department of Industry
That was indeed the decision and the approach taken, that more cities in 2010-11 will receive support from this program than was the case previously. Last year, I believe our numbers indicate, 26 cities received support for 60 projects. This year it was 35 cities for 47 projects. So there was a bit more diversification of the cities, and that was the orientation that was taken by the minister.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Thank you.
I think that's a good thing, and I think those additional cities would also thank you for that support.
Can you tell me whether anyone who received money from this last year was promised that they'd receive money from it this year as well?
Deputy Minister, Department of Industry
The criteria document that Madame Lavallée referred to, the brochure, indicates that each project would be reviewed on its merits, unless there was an undertaking given—and there were a few, three or four projects—that they would receive two-year funding.
Conservative
Deputy Minister, Department of Industry
Yes, at the beginning. But for all other recipients, it was indicated that each application would be reviewed on its merits and would be decided subsequently.
Conservative
Conservative
The Chair Conservative Gary Schellenberger
Thank you.
Mr. Simms, please. You have the next question.
Liberal
Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL
Thank you, Chair.
Thank you, guests.
Every summer I deal with the Canada student job program. The process that's in place now for these student jobs tries to be as objective as it can be, so there's a points system. If somebody, say, gets a certain number of points, they get a student job, and someone who doesn't get a certain number—there's a cut-off point, and arbitrarily I'll just say 40 points—say, below 40, doesn't get a job, that sort of thing. Obviously, because there is only so much money, everybody has a certain ranking. What they do is complete a questionnaire, and they receive points for the answers given.
Is there anything that you would consider to be an objective way of choosing? Is there a similar system? Do you look at that sort of thing? Do you say in your mind, there's a points system involved here for some of these programs?
Deputy Minister, Department of Industry
No, we did not have a points system established--for a couple of reasons. One is that the program is established for two years. We were given this mandate, as I said, a couple of weeks after the budget, and there were a number of events that were almost upon us. We developed an approach whereby we identified key activities that we were prepared to fund, and we sought input from different regional agencies: Is this a good event? Does it have an impact locally? But we did not establish, if you will, a methodological approach to allocating points, partially because it would have been extraordinarily difficult to identify. How do you measure; what metric do you use? But time was truly of the essence.
Liberal
Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL
I understand. But in this particular case, there was a story some time ago on the issue of Pride Toronto being denied federal funds. Subjectively, or even objectively, whichever way you approach it, what do you say to an organization when you say, last year yes, this year no? What's the first thing you say to these people when they ask you why not?
Deputy Minister, Department of Industry
Financially, there were more requests than available funds. You say there were a number of projects—you've mentioned one; Madame Lavallée has mentioned another one—
Liberal
Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL
So obviously that new program, if it's oversubscribed, then... In the case of Pride Toronto, they went from acceptance to not acceptance; they went down because more people came in.
Were those other projects of greater benefit to Canadians in general?
Deputy Minister, Department of Industry
At the end of the day, the government selected some projects. The minister made some decisions.
Liberal
Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL
How does...? So the final decision comes to the minister.
Liberal
Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL
To how many projects, would you say, in percentage terms does the minister say yes or no?
Deputy Minister, Department of Industry
This is not different from our projects as they relate to the strategic aerospace and defence initiative project, through which we provide support to the aerospace industry.
Liberal
Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL
That's true, but without dealing with that, when the minister says that because this program is oversubscribed—“Now I have more people, and there are certain projects”, not just Pride Toronto, but others... I use Pride Toronto because it was in the news; they went from the level of acceptance to not accepted.
Does the minister tell you why, or is it simply a yes or no?
Deputy Minister, Department of Industry
The minister made decisions based on identifying projects that would have the most impact across the country, in different cities, different regions.
Liberal
Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL
Let's say Grand Prix de Trois-Rivières. Why? Will he tell you why that has been accepted? Or do you just put this oversubscribed program in front of him and he says yes, no, yes, no?
Deputy Minister, Department of Industry
We rather rigorously reviewed all applications that we received.
Liberal
Scott Simms Liberal Bonavista—Gander—Grand Falls—Windsor, NL
Do you make a suggestion to him, a short list of what should or should not be? In the beginning I mentioned this points program, because it makes that decision much easier; it creates a short list.
Do you give a short list per se to the minister?
Deputy Minister, Department of Industry
As I said, we looked at this program when it was set up under... We have a brief amount of time to establish conditions, develop the application forms, and so forth. To measure explicitly and allocate points for economic impact... Do you get five points for an international tourist, three points for an interprovincial tourist, one point for...? How do you measure?
We felt that it would be fairly challenging to come up with a reliable modality to go down your path of establishing points. So no, we did not establish points. We assessed whether these projects met criteria. As I said, we received 131 applications this year. We screened out 43 because they were not eligible, which left about 88, of which 47 were approved for funding.
Conservative
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Thank you.
I want to come back to Mr. Simms' question. Did you suggest choices to the Minister so he could make his decision or did he analyze the 88 new applications?
Deputy Minister, Department of Industry
We submitted those projects to him, large and small, from a regional perspective. We made him aware of the ones that had received funding the year before. From that, he selected the 47 projects that received support.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
When you made the suggestion to him that you referred to earlier, I imagine you reviewed the budget available to you, you did an analysis of the projects and you suggested a total amount, that did or did not include the FrancoFolies.
At that point, did you know there were two new criteria, the fact that there would be two events per city or that regionalization was favoured?
Deputy Minister, Department of Industry
I would like to clarify something about the use of the word "criterion". As I see it, the criteria are what is set out in the document, that is, the eligibility criteria for what is funded and what is not funded. For example, there have to be a certain number of participants. In our jargon, those are criteria.
After the whole process was finished and the screening had been done, there were still 88 projects. We then had discussions with the Minister and his staff to break them down somehow. He made an observation about how the money had been spent the year before. That idea prompted him to expand regionalization, to increase the number of cities that could benefit from the program. Those are the circumstances in which the Trois-Rivières Grand Prix, the Valleyfield Regatta and the Truck Rodeo were selected.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
At that point, did you have all of the funds? There was still about $51 million...
Deputy Minister, Department of Industry
There was still nearly $47 million.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Did you break that amount down when you made your suggestions to the Minister?
Deputy Minister, Department of Industry
That is done in the course of lengthy discussions. We discuss topics relating to the department with the Minister. As well, that was the situation in which the idea of offering additional support to the Canadian Tourism Commission came to me, to capitalize on the efforts made during the Olympic Games.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Do you understand that this makes no sense? In January 2009, you announced that $100 million would be reserved for marquee tourism events. You announced that.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Yes, but you issued a press release. I saw it with my own eyes.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
It said $100 million was being allocated for marquee tourism events. I read that press release, and nowhere did it say you were keeping $8 million for the Canadian Tourism Commission, which, as you know, is not a marquee tourism event. There has been some misappropriation of funds within the program. That is reprehensible.
In addition, you are excluding marquee tourism events. You are preventing them from getting funding supposedly because there aren't enough funds for everybody or because the Minister decided there would be two events per city. After all the applications were analyzed, the Minister said maybe it would be better for there to be two events per city, and that would mean funding could be given to people in some municipality or other.
The money was there and you misappropriated it to give it to the Canadian Tourism Commission. I am not denying that you had good intentions or that the objectives for the Canadian Tourism Commission might have been valid, but that is not the appropriate program. The Canadian Tourism Commission was not eligible under the criteria for your own funding program. That was misappropriation.
Deputy Minister, Department of Industry
I would say that "misappropriation" is a bit strong.
Deputy Minister, Department of Industry
We have to look at the program in a slightly broader context, in terms of supporting the tourism industry. The 2009 budget talked about the importance of the tourism industry, and from that perspective, the government was going to support it through that program. As well, an additional allocation was provided for the Canadian Tourism Commission. It's under the heading dealing with support for the tourism industry. There were two components.
The second year, the Minister decided to top up the second component a bit. That was a government decision. The government had to decide where the funds would have the most impact, and it chose this industry.
Conservative
The Chair Conservative Gary Schellenberger
We have to move on. You can go on the next round.
Mr. Galipeau, please.
Conservative
Royal Galipeau Conservative Ottawa—Orléans, ON
Thank you, Mr. Chair.
Welcome, Mr. Dicerni.
I have to admit I have visited the Web site. I looked at the list of festivals that received funding last year and this year. I see that the list for this year is longer than for last year, but I note that total investment is lower—I may be mistaken. I note that last year, $43 million was granted to recipients under the MTEP, the Marquee Tourism Events Program, while this year $39 million was granted. There is also $5 million that was granted to festivals that are funded for a two-year program. That doesn't come to $100 million.
Deputy Minister, Department of Industry
The big piece that is missing is the $8 million.
Conservative
Deputy Minister, Department of Industry
I am going to ask my colleagues. Last year, we spent about $47 million, I believe.
Deputy Minister, Department of Industry
Last year, it was about $47 million, including a number of projects funded for two years. There is about $2.5 million for administration, for the employees hired to handle this. This year, I think we spent about $39 million to support projects, plus the $8 million that was given to the Canadian Tourism Commission, which makes $47 million. There is still $2.5 million for administration.
Conservative
Royal Galipeau Conservative Ottawa—Orléans, ON
Right. I'm just trying to help the people whose applications were unfortunately refused.
How many festivals were funded last year that are not this year?
Deputy Minister, Department of Industry
Quite a few. I could provide the information for you later, because I don't have it.
Conservative
Royal Galipeau Conservative Ottawa—Orléans, ON
Was a commitment made last year to fund them this year?
Conservative
Royal Galipeau Conservative Ottawa—Orléans, ON
So in preparing their project, it would be imprudent for them to assume that the government commitment in one year guaranteed a commitment the next year.
Deputy Minister, Department of Industry
The concept of prudence was discussed with Mrs. Lavallée, and I think Mr. Rodriguez also addressed it. On that question, we tried to be as transparent as possible.
Conservative
Deputy Minister, Department of Industry
I am going to ask my colleagues to do a count. A lot of projects that were funded last year are not being funded this year. In addition, a number of them that were not funded the first year were funded the next year.
Conservative
Conservative
Royal Galipeau Conservative Ottawa—Orléans, ON
But they are receiving smaller amounts, since the total amount is lower, is that right?
Deputy Minister, Department of Industry
That is correct, in part. However, the average is the same, about $1 million. If we count the projects...
Assistant Deputy Minister, Small Business and Marketplace Services, Department of Industry Canada
There are 47, for a total of about $39 million.
Conservative
The Chair Conservative Gary Schellenberger
Ms. Dhalla and Mr. Simms, you're splitting some time here, I think.
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
Thank you very much for coming.
I want to pick up on a point that my colleague had raised. In terms of the minister's approval, a review of applications, how many applications does he personally take a look at?
Deputy Minister, Department of Industry
Those that we had scrubbed, that we had identified as being eligible both in terms of project eligibility as well as the activities within those projects.
Deputy Minister, Department of Industry
This year it worked out to, I believe, 88.
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
Eighty-eight projects. Now when he is given those 88 projects, given all the expertise and so forth in the department, are suggestions made by anyone else on that list of 88 projects as to whether or not they should or should not be approved?
Deputy Minister, Department of Industry
With this program this year, we took the same approach as we had with the other economic action plan program in the department, which was the knowledge infrastructure program, where we scrubbed, we analyzed, and then presented these projects to ministers as being worthy of consideration.
Liberal
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
Out of the 88 projects, what is the percentage that the minister approves?
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
—were not approved. Does the minister provide an explanation as to why those other projects are not approved?
Deputy Minister, Department of Industry
As was the case with some of the other economic action plan programs and initiatives, some were accepted and some were not. Given that there were many more projects requesting much more money than was available, those were the 47 projects deemed to be worthy of government support.
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
So 41 projects, almost 50% of the projects that were put forward to the minister, were not approved.
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
Was there any money left over in terms of the availability of what existed once the 47 projects were approved?
Deputy Minister, Department of Industry
That's where it was felt that there would be more impact, more positive impact, by redeploying some of those resources to the Canadian Tourism Commission so that they could capitalize on the success of the Olympic and Paralympic winter games, in order to reach out to some of the emerging tourist markets, because this again, I'm going to emphasize, is part of a broader strategy to improve or increase the visitor economy of Canada.
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
So one out of every two projects, despite the positive recommendation by the department, is not approved by the minister.
Deputy Minister, Department of Industry
This program was part of the economic action plan. A certain amount of money was allocated to it, and the minister identified projects, as previously discussed, that were more regional in nature. There was greater penetration across the country than had been the case in previous years. There was a 30% and 40% increase in the number of cities. So that's the choice.
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
When the minister is approving one out of every two projects—so there's a 50% approval rate despite the positive recommendation by the department—do you think politics could play a role of any sort in his decision?
Conservative
Deputy Minister, Department of Industry
It would be extraordinarily imprudent of me to speculate upon such a hypothetical question.
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
Okay. So you don't know what criteria the minister is basing his decision on, then.
Deputy Minister, Department of Industry
I believe good judgment, good assessments of where the projects would have good tourism impacts, and if you look across some of those projects, such as the Grand Prix in Trois-Rivières, the Régates de Valleyfield—
Liberal
Ruby Dhalla Liberal Brampton—Springdale, ON
But all 88 projects received that positive recommendation by the department.
Deputy Minister, Department of Industry
I'm sorry, I should just qualify that. We reviewed them in regard to eligibility. We reviewed them in the context of whether they met program criteria. There's a small difference between doing that and actually recommending the 88 projects.
Conservative
Bloc
Roger Pomerleau Bloc Drummond, QC
Thank you, Mr. Chair.
Thank you for coming to talk to us today. I am very pleased that my colleague Mr. Simms raised the example of summer jobs, which we, as members of Parliament, look after in our ridings, because that is the only program where we play exactly the role of yourself and the Minister, overall. Under that program, we distribute funds for summer jobs for students, figures ranging from $3,000 to $4,000, to businesses or organizations that agree to hire a student for the summer, for a certain number of weeks.
Naturally, nearly all of us, in our ridings, receive applications every year totalling $1 million. Personally, I have $240,000 to distribute, which is about the same amount as all members have. We receive about four to five times as many applications as we can fill, and we have to find ways of distributing the money transparently and intelligently. We set up a system similar to yours: we have pre-established criteria, a defined analytical grid, a deadline for people to apply and a deadline for giving them an answer. Those people have to hire a student for the summer and guarantee the student something, and if we don't give them an answer by a certain date, the student will finish school and go to work somewhere else. They have to jump at the first job they find. People may receive money and not be able to find a student to fill the position, or vice versa. So we have to have specific deadlines, and we abide by them because we know the money will be distributed intelligently if we do that, and it won't be if we don't.
The purpose of the entire operation is to be as transparent as possible, because it is public money, we know that, because we can be called on to answer for everything we do, and also because we want each of the organizations that does business with us to be aware that this is a transparent method. We provide reasons, but only on request, for the decisions made, that is, if we are asked for the criteria, for the analytical grid, we will give them to people. If we aren't asked, we don't have to do it, but if we are asked, people are given everything.
In the case before us today, I note that the criteria changed in midstream, something we would never do. I'm not talking about criteria for applying or eligibility criteria. Criteria for analyzing and selecting, for the projects, were changed in midstream without people being informed. That is an anti-transparent measure that is not shown anywhere, people were not informed, and it changed the entire way funds were distributed, without people having anything to say about it. I think they are entitled to think that it wasn't transparent.
I also support my colleague, who uses words that are occasionally weak: $8 million has been "misappropriated". It was misappropriated in terms of the pre-established criteria for this program, when that money should have been given to businesses that were clearly defined at the outset. In fact, the Canadian Tourism Commission did not meet those criteria. It can always be said that the money was used well, that it was well spent, that it was used for tourism, that nobody stole it, but the fact remains that in terms of the program criteria, that money was misappropriated, and that is completely anti..., anti... In any event, there is nothing transparent about it, in my opinion.
I would like to hear your comments on that.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
The word you're looking for is "anti-transparent".
Deputy Minister, Department of Industry
I will make two comments. First, in terms of the issue of misappropriation, a government always has the right, and even the responsibility, if it wants to reallocate funds... If that had been done under cover of darkness and there had been no transfer, agreed, but it was done in a press release. The Minister clearly said that in a context of supporting the tourism sector, he was going to direct additional funding, on top, to the Canadian Tourism Commission. The year before, a fund had been set aside for the Canadian Tourism Commission, which he decided to top up. I don't think this amounts to misappropriation of funds; rather, it is a government decision to reallocation funds to other activities.
Deputy Minister, Department of Industry
Second, I am also aware of the example Mr. Simms talked about concerning summer jobs. About 30 or 40 years ago, I was hired under the Local Initiatives Program. I was actually on the team that recommended that some changes be made to expand the role of members of Parliament. At the time, they were programs that had to be supported over the years and had to be repeated from year to year. The same thing applies to the student jobs program. We hope it will be a program that will be supported over the years.
In the case that concerns us, it was a very specific program, lasting two years. This year is the last year. There will be no more grants next year, as the member said. I don't expect to have the privilege of appearing before your committee next year to talk about this program.
So we have to ask whether it was worth it to invest in what I might call a certain "infrastructure", to train people, and so on, for a program that is in fact ending this year. In the department's budgets for next year, there are no appropriations for this program.
Conservative
The Chair Conservative Gary Schellenberger
Thank you.
We'll go to Mr. Uppal, and then we're going to go to Mr. Rodriguez.
Mr. Uppal, please.
Conservative
Tim Uppal Conservative Edmonton—Sherwood Park, AB
Thank you.
We've heard that there were more projects approved this year than last year; more people and more communities have been touched by this funding. You have said that it's made a positive impact on people. Can you explain a little bit about the positive impact to these communities that this funding brings?
Deputy Minister, Department of Industry
I think I will defer to some of my colleagues, who are perhaps closer to the...
Marie-Josée, you could perhaps speak to some of those projects that this year received funding that had not received funding in the first year.
Assistant Deputy Minister, Small Business and Marketplace Services, Department of Industry Canada
Thank you, Deputy.
Essentially, there were three results or three objectives to this program: to try to sustain or increase the number of out-of-country/out-of-province tourists, to grow the revenues for the event, and to sustain or grow the revenues in the community in which the event was being held. The benefits that would accrue as a result of the funding under the program would be to the event itself but also to the small businesses, restaurants, and hotels in the community where the event was held. So it does have a broader reach into that community.
In terms of the actual economic impacts, every recipient under the program was asked to submit, as the deputy noted earlier, an economic impact study. Those economic impact studies had to be submitted for year one recipients at the end of the fiscal year. We are now, in fact, in the process of reviewing what are some of the benefits that have accrued as a result of this project.
One thing to note is that of the first group of recipients in year one, of the 60 which were through those 26 cities, 13 chose not to reply in year two and two were not eligible in year two. Of the 47 that were funded in year two, 19 were new recipients in nine additional cities. So the reach has indeed been broader.
Conservative
Tim Uppal Conservative Edmonton—Sherwood Park, AB
The idea was to bolster tourism locally and across Canada, and also help the Canadian economy, as part of the economic action plan. Can you tell us, in a broader sense from some of the preliminary numbers you have, a little bit about how that's helped the economy across Canada, how that's impacted the economy? Do you have preliminary ideas from those numbers?
Assistant Deputy Minister, Small Business and Marketplace Services, Department of Industry Canada
We don't at this time. What we do know is that the tourism industry was quite significantly impacted by the economic downturn. We know, for example, that employment fell by 2%. We know that revenues declined in this industry. So we do know that the program, which had an economic focus, came at a time when the tourism industry was in need of further support.
Deputy Minister, Department of Industry
I could just briefly add that some proponents have said this program made a very unique and extraordinarily timely contribution, where it gave them just that bit of additional funding to get them over what was a horrible period of time in the summer of 2009, Stratford being one, the Jazz Fest in Montreal being another.
Conservative
Tim Uppal Conservative Edmonton—Sherwood Park, AB
Very good.
With respect to that, how does the support for marquee tourism promote Canadian heritage itself?
Deputy Minister, Department of Industry
Well, it broadens the number of people who can appreciate the diversity of Canadian identity and various Canadian cultures. I think it is a great opportunity to create what we refer to in French as des événements rassembleurs. It brings people together because it exposes a diversity of people to the great and diverse activities that occur in Canada.
Conservative
The Chair Conservative Gary Schellenberger
Thank you.
The last question is from Mr. Rodriguez, please.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Thank you, Mr. Chair.
Before coming back to the management, I want to take another example of an event, because it helps me understand whether things have changed or not. I'll address it briefly. The year before, did the Toronto Pride Parade achieve the objectives set?
Deputy Minister, Department of Industry
That's the same thing, I think their impact analyses haven't been done yet, if I'm not mistaken.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
You didn't have any problem with them; we know that, at least.
Deputy Minister, Department of Industry
I don't think so. Last year, they were recipients...
Deputy Minister, Department of Industry
...of financial support from the program.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Have the internal rules changed, so that this event, which qualified last year, couldn't qualify this year?
Liberal
Deputy Minister, Department of Industry
They made an application. They were eligible.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Is there a single event in the gay community that is funded by the program?
Deputy Minister, Department of Industry
I don't think that is one of our criteria. In our document...
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
I'm not saying it's one of your criteria, I'm wondering whether a single gay event was funded.
Deputy Minister, Department of Industry
I don't know, because we don't review the programming from that angle.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Generally, they do have a good idea. Gay pride, the Toronto Pride Parade, and so on, they do have a good idea...
Liberal
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Could you get back to me with the figure, please? I assume that...
Deputy Minister, Department of Industry
But I don't know whether, as I'm saying, our documentation allows us to determine accurately and precisely...
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
With all due respect, sir, I think it does. It's up to you to show me that your documentation doesn't allow you to know that. I think it does allow you to know that, because there are obvious indications.
I would just like to know whether or not there are any. My calculation gives me zero, but I would like you to confirm or...
Deputy Minister, Department of Industry
As I say, last year, there was the Gay Pride Parade in Toronto, which I went to. When I lived in Toronto, I often went to it. They received support...
Deputy Minister, Department of Industry
...but that is not a criterion we apply.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
I'm not passing judgment, I just want to know. In my opinion, there is no funding for any gay event, and I would like to have confirmation, please.
To come back to management, did the Minister see projects that were not on the list of 88 events, projects that did not qualify? Did he see any of them?
Deputy Minister, Department of Industry
I don't think so. No, we presented projects that met the program criteria.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
You are absolutely certain that he saw only projects that appeared on the list of 88 events? He would not have approved a project that did not necessarily qualify?
Assistant Deputy Minister, Small Business and Marketplace Services, Department of Industry Canada
After our review,using all the eligibility criteria and requirements of the program, we submitted and gave the Minister the projects that were eligible.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
So as my colleagues have said, there is no point system. That means that the Minister has total carte blanche. Am I mistaken when I say that?
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Once the projects meet the criteria, he has total carte blanche?
Deputy Minister, Department of Industry
Let me go back to a basic point. From the standpoint of public administration, ultimately all decisions made are ministerial decisions...
Deputy Minister, Department of Industry
...whether it be about EDC or the FedNor program. They are ministerial decisions, and...
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Can you simply give me a yes or no answer? Did he have carte blanche?
Deputy Minister, Department of Industry
The Minister can identify projects that he considers to be suitable for contributing to achieving the program objectives.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
But the minister doesn't have to give reasons. He doesn't have to tell you why this or that. In other words, he has carte blanche.
Deputy Minister, Department of Industry
That is why in the parliamentary system, in question period, a number of you have already questioned him on his choice of projects. So I would not say he has carte blanche, because you all have an opportunity...
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
We can question him about it, but when he makes the choice, he has carte blanche.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
He can do what he wants. In fact, the Minister does not have to explain to you why he chose this festival and not another one. He doesn't have to give reasons, he just has to say yes or no.
Deputy Minister, Department of Industry
He doesn't have to say why he chose the Trois-Rivières Grand Prix, no. That is not how the hierarchy works.
Liberal
Conservative
Royal Galipeau Conservative Ottawa—Orléans, ON
The Minister doesn't have to answer for his actions to the deputy minister, he has to answer to you.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Thank you for the clarification, Mr. Galipeau. What I want to know is whether he has carte blanche. Can you give me a yes or no answer?
Deputy Minister, Department of Industry
It is not a term I use, because if he had carte blanche...
Liberal
Deputy Minister, Department of Industry
If he had carte blanche, he could choose from the 131 projects that were submitted.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Perfect. Did he have carte blanche when it comes to the projects that were selected?
Deputy Minister, Department of Industry
He has the discretion to identify the best projects that will enable him to achieve the program objectives.
Bloc
Conservative
The Chair Conservative Gary Schellenberger
Okay. I think that brings us to the end of our questions.
Madame Lavallée.
Bloc
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Yes, but I requested the floor before you, Mr. Del Mastro.
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
Yes, but I thought that... I don't want to speak, I want to ask...
Conservative
Bloc
Carole Lavallée Bloc Saint-Bruno—Saint-Hubert, QC
I have something to ask you. I would like the Canadian Tourism Commission to send us a breakdown of how the $8 million in question was spent and what results are expected or have already been obtained.
I'm not too familiar with the procedure for making an official request for a document like that. Does it take a proper motion, or should I just ask them for it? I don't know.
Conservative
The Chair Conservative Gary Schellenberger
As chair, I imagine we can make the “ask”, if it can be done.
Bloc
Deputy Minister, Department of Industry
The Canadian Tourism Commission is a Crown corporation. It is independent and has its own board of directors. I can ask the people in charge there for it.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Can we also have the list of the 88 projects that were approved, through you?
Deputy Minister, Department of Industry
As I told you, with the constraint I mentioned, it depends on what information we have in our records. There are no criteria that...
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
No, I want to know whether you can submit the list of the 88 projects from which he chose projects.
Liberal
Conservative
Dean Del Mastro Conservative Peterborough, ON
Do you mean everybody who applied? You want everybody who applied, not just those approved?
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
Those who were selected, the 88. It's those who passed the test.
Is that possible?
Deputy Minister, Department of Industry
The list of projects selected has been released. For the projects that were not selected, I would gladly share it with you, but I would have to ask the people to give their permission because we're dealing with the Access to Information Act. The Act says that because there is confidential information in the applications, the applicants have to be asked whether they are prepared to release it. But as I told you, it isn't a problem for me.
Liberal
Pablo Rodriguez Liberal Honoré-Mercier, QC
I'm not asking for what is in the projects themselves, but if we could have the list with the amounts...
Deputy Minister, Department of Industry
Even that, if I may, we will check it with the...
Conservative
The Chair Conservative Gary Schellenberger
Okay, now the final question. I'm sorry I missed Mr. Del Mastro for the final question.
Conservative
Dean Del Mastro Conservative Peterborough, ON
It's all right, Mr. Chair. I'm often very quiet and easily overlooked. I understand. I won't blame you for that.
Conservative
Dean Del Mastro Conservative Peterborough, ON
I'm very demure over here.
Obviously, I don't think there's anything wrong with MPs coming forward and fighting for their regions. I think that's why this was called, as people wanted some clarification as to how the program worked, and ultimately people want to fight for their regions.
But I would note that Mr. Alain Simard was recently in the news, and one of the things he said was there was no doubt the federal government today was more involved in providing more support for festivals than any government ever has. I think that's a pretty big endorsement by somebody who also said he understood there was no guarantee of federal funding. Of course, he's the gentleman running the FrancoFolies.
So I think that as much as there is disappointment, I've never seen anybody who has applied for federal or government funding of any sort who hasn't been disappointed in some way if they weren't given the funding. I think it's a reality that we face that there is a finite amount of government funds available and an infinite number of asks. As much money as you put on the table, there will always be asks for more money over and above that.
Have you heard from any of the applicants last year or this year? Have you heard evidence from them, or have they made any comment to you about how this program is assisting them in drawing more tourists and promoting and operating their events? Were they telling you stories of difficulties in finding sponsors last year, and so forth? Are we hearing positive reviews of how the program has assisted these events through what was a fairly significant global recession?
Deputy Minister, Department of Industry
As mentioned, all of those who have received funds have been asked to do an economic impact assessment. Those are ongoing and we should receive them shortly.
Having said that, a number of individual groups have noted that as a result of the MTEP program, they were able to add an event or add some plays, Stratford being a case in point. I think Monsieur Simard said that as a result of that, he had Stevie Wonder last year at the jazz festival in Montreal. It was directly related to that.
I think this speaks to the fact that it did have an impact during what was an extraordinarily difficult year for a number of sectors, tourism being one of them and the auto sector another, which we are also involved in. So 2009 was a horrible year, and I think these initiatives helped bridge a difficult gap.
Conservative
Dean Del Mastro Conservative Peterborough, ON
Yes, I'd agree with you. I think it was part of a very effective economic action plan that has seen Canada lose significantly fewer jobs than competing economies. I think we're now seeing the benefits of a rapidly expanding economy. Our GDP is growing rapidly, with over 300,000 jobs created, Mr. Chairman. The OECD has referred to Canada as a shining star.
So I think this is part of an overall economic action plan.
I want to thank you for your work in administering the program on behalf of all parties. I think all members would agree that the success of the economic action plan is something we all celebrate.
Thank you, Mr. Chairman.
Conservative
The Chair Conservative Gary Schellenberger
Just in closing, I'd like to say one thing as chair; lots of times I don't have the opportunity. But I do represent Stratford—
Conservative
The Chair Conservative Gary Schellenberger
—and I'm just going to give you a little bit of an example of how important this was to the Stratford Shakespeare Festival.
Last spring ticket sales were way down, and the festival projected there would be a $7 million loss. After they had done all the cutting they could do, they put 30 performances on hold. Once they got their funding and they did their advertising, their sales went up. At the end of the year, their sales were way up. They did end up in the black by I think close to $200,000. The economic impact in the area was pegged at somewhere around $34 million.
Was it a success? Yes. They just opened on Monday night, the grand opening night, for another great season of the Stratford Shakespeare Festival. I hope everyone has an opportunity to attend that great tourist area in Stratford, Ontario.