Environment Committee on Dec. 5th, 2017

[The Chair (Mrs. Deborah Schulte (King—Vaughan, Lib.)), Liberal, Deb Schulte]

Welcome.

We are back to FSDA. Pursuant to the order of reference of Thursday, October 19, the committee resumes consideration of Bill C-57, an act to amend the Federal Sustainable Development Act.

We have in front of us some guests from the Office of the Auditor General of Canada.

We have Julie Gelfand, commissioner of the environment and sustainable development. Welcome back.

We also have Andrew Ferguson, principal; Andrew Hayes, principal; and James McKenzie, principal.

We will open the floor to you. You know the drill: when you have a minute left, I'll hold up the yellow card; when I hold up the red card, I don't mean for you to just stop, but to wrap up.

[Joël Godin, Conservative, Portneuf—Jacques-Cartier, QC]

Do we have the document in French?

[The Chair, Liberal, Deb Schulte]

Yes. There is just a bit of a challenge with some of the distribution.

Go ahead, Ms. Gelfand.

[Julie Gelfand, Commissioner of the Environment and Sustainable Development, Office of the Auditor General]

Okay.

Madam Chair, it is a pleasure for us to be here today to share our views on the Federal Sustainable Development Act.

As you indicated, I am joined by senior colleagues from the Office of the Auditor General, Andrew Hayes, James McKenzie and Andrew Ferguson. Mr. McKenzie and Mr. Ferguson worked for a very long time with the previous version of the Federal Sustainable Development Act. They are experts in this matter.

As Canada's Commissioner of the Environment and Sustainable Development, I feel a special responsibility to support your review of Bill C-57. My remarks are informed by our office's 20 years of audit work on the federal sustainable development strategies and will cover the following issues: expanding the focus of the act to include the social and economic aspects of sustainable development; the proposed new principles; and reporting on sustainable development progress and improving accountability.

I was pleased to see that the purpose of the proposed new act is to provide for a federal sustainable development strategy that makes decision-making related to sustainable development more transparent and subject to accountability.

I understand from the proposed section 3 in Bill C-57 and the Minister of Environment and Climate Change Canada's comments before this committee that the federal sustainable development strategy required under the act must respect and support Canada's international commitments. These include the United Nations agenda 2030 and the sustainable development goals, the United Nations Declaration on the Rights of Indigenous Peoples, and the Paris convention, as examples.

Although some of the amendments to the act appear to embrace the three aspects of sustainable development, I am concerned about the limited scope of proposed section 10.1, which is focused solely on environmental impacts.

In addition, it is my view that the implementation of the Federal Sustainable Development Act will require a whole-of-government approach. In this regard, strong governance is crucial.

I would recommend that the committee consider whether an amendment can be made to proposed section 10.1 to authorize the Treasury Board and potentially the Minister of Environment and Climate Change Canada to establish policies and directives relating to the sustainable development impact of government operations and to report on sustainable development progress.

I am pleased to see that the new bill introduces several principles that must be considered when the Federal Sustainable Development Strategy and departmental sustainable development strategies are prepared. My office will use these principles when we audit the Federal Sustainable Development Strategy and the 90 departmental sustainable development strategies.

That said, we anticipate that we may have difficulty assessing whether the principles have been put into practice, because several are open to interpretation.

In accordance with the principles that are set out in the amendments to subsection 5a), the committee may wish to consider the merits of entrenching the cabinet directive on strategic environmental assessment in the Federal Sustainable Development Act. This could be a tool to support the consideration of economic, social, and environmental impacts of all decisions.

Our office supports the amendments which will require more than 90 departments and agencies to prepare, implement, and report each year on their sustainable development strategies. I see this as a positive step towards the integration of sustainable development considerations across government.

I plan to assess the departmental sustainable development strategies against the FSDS, the principles as outlined in proposed section 5, as well as the international commitments as outlined in proposed section 3, the purpose, of the new bill. I will be looking to see how departmental sustainable development strategies support Canada's international commitments, in particular, the United Nations agenda 2030 and the sustainable development goals. I expect that most departments will need to go beyond greening of government operations. I will be looking to see how departments assess their policies and programs to achieve these international commitments and how they apply the principles to all of their activities.

With these amendments, I will continue to fulfill my statutory role with respect to monitoring sustainable development strategies. That said, I would have nearly 70 more entities to audit. The committee should be aware that this change will have significant resource implications for the office.

As a result of the increase in the number of entities that will be preparing progress reports, I highly recommend that reporting on departmental sustainable development strategies be standardized across government. By standardized, I mean that the results for all departments and agencies should be presented at the same time each year and in a common format, so that Canadians can understand the results that have been achieved and so that my office can provide a meaningful assessment of those results for parliamentarians.

As auditors, we support the idea of strengthening accountability for results. One way to achieve this would be for the act to specifically require deputy heads or ministers to acknowledge their accountability by signing off on the completeness and accuracy of their progress report on their sustainable development activities, much as you would see in financial statements.

You could also strengthen accountability, which was discussed at length during the committee's previous study of the Federal Sustainable Development Act, by incorporating accountability for sustainable development results in the performance agreements of deputy heads.

Madam Chair, I commend the committee for its work and hope that my suggestions will be helpful to you.

This concludes my opening remarks. We would be happy to answer the committee's questions.

[The Chair, Liberal, Deb Schulte]

Thank you very much.

First up is Mr. Amos.

[William Amos, Liberal, Pontiac, QC]

Thank you, Madam Chair.

To our commissioner and team, I very much appreciate your willingness to come at short notice and to give us your assessment of Bill C-57.

My first question goes to the issue of resources. You state that with 70 more entities to audit, you will require new resources. Can you elaborate a bit further on what would be necessary for your office?

[Julie Gelfand]

That's a great question. I don't even know if we have assessed that yet.

Right now, over a five-year period, we assess 26 entities. Over five years, we're looking at around five different entities and some aspect of their departmental sustainable development strategy. If we have to do that for 90 entities, I'm not sure how we're going to that in a period that would be reasonable to present back to you.

We have not done the assessment of how many more resources it would require, but it's just a flag to say that if we go from 26 to 90 and I'm supposed to review these and present back to you, doing that will require something.

[William Amos, Liberal, Pontiac, QC]

You speak to the importance of standardizing across government the approach to reporting on departmental SD strategies. Do you have any perspective on what the nature of that standardization should be and how it should be framed? I ask that question because you referenced the increased resources that will be required for the number to jump up to 70 audited entities. I presume that standardization would better enable the auditing function. Could you—

[Julie Gelfand]

Absolutely. Right now, the way it's written in the proposed bill is that entities can report any time in the year, so it's going to be really difficult for us to be able to capture all that and present an overview of the results to Parliament.

One of the standardization items is that they are all presented at the same time so that we can then take them away, have a look at them, and give you some form of assessment. That's one form of standardization. The other form would be in how they're constructed. Treasury Board can issue those kinds of guidelines to departments to say what sections they want to see in each of the reports.

I'll just pass it off to Andrew. This was one of Andrew's big concerns.

[Andrew Ferguson, Principal, Sustainable Development Strategies, Audits and Studies, Office of the Auditor General]

You also mentioned that the departmental strategies are to respond to the federal strategy and demonstrate how they support that. As the commissioner mentioned, the federal strategy says that it will align itself with the UN SDGs. That would be another way, potentially, that departments could standardize their approach to reporting to align it both with the federal goals and the UN SDGs, as called for in the bill.

[William Amos, Liberal, Pontiac, QC]

You don't comment in any manner in relation to the principles that underpin the bill. There have been recommendations made by this committee, and then subsequently, the government has adopted some of the principles that were suggested. I wonder if you have any comments in relation to the legal principles that underpin this statute and Bill C-57 amendments.

[Julie Gelfand]

I believe I did say something in my opening statement about the principles. We support these new principles. We will audit against them. We are concerned that, without more clarity on what exactly they mean, they can be open to interpretation. I can tell you that when we review both the federal sustainable development strategy and the departmental ones, I will be asking the question as to how they incorporated all those principles into the development of their departmental strategies.

What I've seen in terms of departmental strategies to date under the past law was that they were very much focused on greening operations like buying FSC paper and recyclable pens, but they did not seem to look at their policies or programs to say how they were going to achieve all of their international commitments: what are we as a department going to do to achieve the SDGs; what are we going to do to achieve the Paris commitment and all the other international commitments that would fall under the rubric of sustainable development?

I'll be looking at both of those things, how they apply the principles to their sustainable development strategy as well as how they meet those international commitments, which is, in my opinion, probably way beyond simply greening government operations.

[William Amos, Liberal, Pontiac, QC]

I think I'll leave my questions there.

[The Chair, Liberal, Deb Schulte]

You're just about out of time with 30 seconds left.

[William Amos, Liberal, Pontiac, QC]

Thank you.

[The Chair, Liberal, Deb Schulte]

You're welcome.

Mr. Sopuck.

[Robert Sopuck, Conservative, Dauphin—Swan River—Neepawa, MB]

Thank you.

When I look at the definition of sustainable development in the act on page 2, it means “development that meets the needs of the present without compromising the ability of future generations to meet their needs”. That's the Brundtland definition. I'm glad that the government has accepted the Brundtland definition of sustainable development so it's quite clear that sustainable development is a development concept.

Is that correct, Ms. Gelfand? Would you agree with that?

[Julie Gelfand]

Absolutely, and if you look at the sustainable development goals, good jobs, innovation, and strong infrastructure are all within the SDGs.

[Robert Sopuck, Conservative, Dauphin—Swan River—Neepawa, MB]

Except when one looks at the purpose, the purpose as implementing a federal sustainable development strategy that will make environmental decision-making more transparent, which very much jives with your point number five when you say you're “concerned about the limited scope of proposed section 10.1, which is focused solely on environmental impacts”.

The act starts off as a development concept under the definition of sustainable development, but then quickly devolves back to an old-style environment act. Isn't this inconsistent?

[Julie Gelfand]

I mentioned in my opening statement about expanding the definition of exactly that, that it's not just about the environment. If we're going to achieve sustainability, it's about social and economic issues. We mention that, and that's one of the reasons we mentioned that you might want to consider looking at proposed section 10.1 to expand that.

[Robert Sopuck, Conservative, Dauphin—Swan River—Neepawa, MB]

Right. So measurements of job creation and economic growth should also be considered as measures of sustainable development. Is that correct?

[Julie Gelfand]

According to the SDGs, that's correct.

[Robert Sopuck, Conservative, Dauphin—Swan River—Neepawa, MB]

Good, I certainly agree with that.

In terms of the location and the responsible minister, however, when you look at section 7 of the act, it looks like the office will be run out of the environment minister's department, and that all other departments will essentially report to the environment minister. Is that a fair conclusion? If you look at section 7, the office will be in the environment minister's office. Does that mean that the environment minister will have a veto over all other government departments?

[Julie Gelfand]

You'd have to ask the department that. I can't answer that, but obviously, according to the act, the Minister of Environment will be the one who brings together the federal sustainable development strategy. I don't know if that puts them on top of everybody else. However, I believe that it has been recommended in the past that the creation of the federal sustainable development strategy and its location may be better suited to a more central agency.

[Robert Sopuck, Conservative, Dauphin—Swan River—Neepawa, MB]

I recall that when I was part of Premier Gary Filmon's sustainable development effort, that effort was located in the premier's office and it ensured an equality of the ministers.

This is something that concerns me greatly. If the environment minister's office publishes a—quote, unquote—“bad report” on a department, that's essentially a veto.

In terms of socio-economic impacts, Commissioner, in your view, does that also include an evaluation of lost economic and job opportunities if a project does not proceed? For example, we know Canada builds pipelines in a very environmentally sound way. When energy east was lost, thousands of jobs were lost, and I use that as one example. Don't you think that an evaluation of the opportunity costs of the loss of environmentally sound projects should be part of the evaluation?