Environment Committee on Feb. 10th, 2009

[The Chair, Conservative, James Bezan]

Thank you. The time has expired.

We're going to do a third five-minute round for all the parties.

Mr. Scarpaleggia.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

Thank you.

I have a quick question. Did you get a sense of where the government is at in terms of its Turning the Corner plan? Would you have looked at that as to whether the plan is on its way or if it's stuck somewhere?

[Scott Vaughan]

We only looked at the two measures on the trust fund and the tax credit. Those were two measures identified in the government's national climate change plan that was submitted to Parliament in 2007-08.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

Okay.

In terms of the ecoTrust, permit me to ask a rather naive question.

You said that when it comes to setting up trusts, by definition there's really no accountability. We're trusting the provinces and we're giving them money, whether it be to hire police officers or whatever. We don't really expect them to report back to us. That seems to be the general philosophy when it comes to trusts, so why bother looking at the ecoTrusts?

[Scott Vaughan]

Thank you for the question.

To reiterate, last week the Auditor General gave an overall study on the nature of the trust. I think this one is different because, as you say, there's no obligation for the provinces to report. However, the government set a target on what they expected performance of the trust would be for the climate changing theme.

That was the anomaly on this one. There are no conditions generally attached for provinces in terms of how they spend the money. Where it became difficult is that because of the virtue of the target attached to this trust fund you would then ask how you report back.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

Basically the government should have been straight with Canadians and said it was just going to write a cheque because it believes in devolution.

Did the Auditor General not call into question the trust arrangements in a previous study? I'm trying to remember. In general, had the Auditor General not called into question this whole method of disbursing funds because of the lack of accountability?

[Scott Vaughan]

Not that I'm aware of, sir.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

That's fine.

[Scott Vaughan]

I think this is the first time the Auditor General has actually provided a study to Parliament on the nature of the trust funds.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

Okay.

Now in terms of the cost of the transit pass credit--I'm just trying to understand--there are two components. There's a numerator, which is the total money spent on the tax credit by the government, and the denominator is the number of tonnes reduced because of it.

Did I understand correctly that it will take until 2011 to know the value of the tax expenditure to the government? This is another naive question, Commissioner, but it seems that the revenue department would just have to press a button and figure out how many people claimed a transit tax credit. Why is it going to take until 2011? Did they give reasons for this? If so, are you satisfied with the reasons?

[Scott Vaughan]

I think part of your question is the methodology the government is using to do that calculation in terms of how many people asked for the credit and the impact on total greenhouse gas emissions. We also try to point out that people take public transport for different reasons. Trying to get causality on this can be very difficult.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

So it's not the numerator that's the problem; it's the denominator.

[Scott Vaughan]

I think it may be both. You might want to ask Finance Canada about the methodologies they're assuming to figure this out.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

I'd like to go back to Mr. Calkins' points, which I thought were very good. He said farmers will essentially self-regulate, in the sense that they know what's good for their farm in terms of environmental protection and so on. I buy that up to a point. When it comes to things like the runoff of fertilizer into rivers that move downstream, they don't really have a stake in what they're doing. They're passing the problem along to people downstream.

How do you get around this problem that you have to have confidentially on the one hand, but on the other hand you're giving money that may not be effective because it's not in the interest of a farmer to take a particular environmental precaution?

[The Chair, Conservative, James Bezan]

The time has expired, so a very brief response, please.

[Scott Vaughan]

I'll ask my colleague Mr. Maxwell.

[The Chair, Conservative, James Bezan]

Mr. Maxwell.

[Neil Maxwell]

Very briefly, we were impressed that this department was actually moving on the whole realm of agri-environmental indicators. These are essentially state of the environment indicators that try to capture that sense. You may want to have the department here to brief you more extensively on this.

In some instances, agricultural impacts are improving, and some are deteriorating. It's certainly not the case that across the board things are getting worse. Some are getting better.

[Francis Scarpaleggia, Liberal, Lac-Saint-Louis, QC]

I wasn't suggesting they were getting worse.

[The Chair, Conservative, James Bezan]

Your time has expired.

Maybe as a farmer I'm a little too sensitive on all this. I'm the only farmer sitting at the table. I get a little sensitive at times with all these comments. I can tell you that as a farmer, when my father inherited the farm from his dad, my grandfather, my grandfather always wanted to leave it in better shape than he found it. My father wants to leave his farm in better shape for his children, and I'm doing the same thing with my kids. And that's not just about being a profitable operation, but about environmental sustainability on our farms as well. If we're not environmentally sustainable, these farms aren't going to last.

Monsieur Bigras, s'il vous plaît.

[Bernard Bigras, Bloc, Rosemont—La Petite-Patrie, QC]

Thank you, Mr. Chair.

I would like to talk about the sustainable development strategy and have a look at the public transit tax credit, a bit like a case study.

In 2008, Parliament passed the Godfrey bill, which requires you to study the targets Environment Canada will have put in place by June 2010. In Chapter 1 of your report, it says that:

Finance Canada did not provide documentation that it had assessed the key environmental and economic impacts of the Public Transit Tax Credit—

and that:

The Department provided a copy of its strategic environmental assessment but was unable to show how it was integrated into the Department's overall analysis under the Framework, since it too constituted a Cabinet confidence.

Over the next months and years, you will have to audit the sustainable development strategy. How will you be able to do that if some departments, including the Department of Finance, refuse to submit overall analyses? Is this systemic? Do all departments do this? If the Department of Finance has the same attitude towards the sustainable development strategy audit as it had towards this document during the tax credit audit, there will be problems. Do you feel that, under the circumstances, this type of approach by the departments will complicate your work?

[Scott Vaughan]

Thank you. I would like to ask my colleague Mr. Arseneault to answer your question. I am new to the Auditor General's Office, but I would think that it is quite rare that we would not have access to government documents, to analyses. I think that the Department of Finance, and the measures concerning the tax credit analyses, is really an exception.

[Richard Arseneault, Principal, Office of the Commissioner of the Environment and Sustainable Development]

Usually we have access to any documentation we need in order to do our analyses. Normally, that would include any analyses submitted to cabinet. That was quite an exceptional case, but it has always been difficult to get information from the Department of Finance when we are doing an audit. It is often a question of cabinet confidences or of confidential information for the minister's eyes only. We have had issues like this with the Department of Finance in the past, and it is happening again this year. The sustainable development strategy will apply to all departments. Normally, we have access to the information we need in order to perform an audit.

[Bernard Bigras, Bloc, Rosemont—La Petite-Patrie, QC]

I understand what you're saying, but taxation is a key element in a sustainable development strategy. Just think about the tax exemption for oil companies, which represents close to $5.9 billion. Is the fact that this key element of an environmental policy is the responsibility of the Department of Finance going to make your work fundamentally more difficult? We are not talking about Veterans Affairs. This is the Department of Finance, which establishes tax measures, and taxation is fundamental to environmental policy.

[Richard Arseneault]

We do not know what the government's sustainable development strategy will contain. The government may decide to move in another direction. If there are financial issues that involve the Department of Finance, we will report back to Parliament. If we have accessibility issues, we will say that.