Finance Committee on June 22nd, 2020

[John Casola]

Thank you for the follow-up question.

No, it's not correct to say the banks would have been there anyway, so why are we bothering because they would have come in? To say the government could have done it, absolutely, the government could have done it all. We think the beauty and the magic of the bank's mission is to take either 100 to build one REM, or to employ the methodology we're using by filling whatever minimum gap there is to crowd in private capital for the rest, and now all of a sudden we can build two or three REMs with that very same hundred.

It really is a question of spending taxpayer money more responsibly, of leveraging that $35 billion that we have to create some multiple of that. Because of all the private sector capital, we're able to crowd in financing and really expand the reach of building new and needed infrastructure across the country.

[The Chair, Liberal, Wayne Easter]

Mr. Julian, followed by Mr. Cumming.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Thanks, Mr. Chair, and thanks, Ms. Ropar, Mr. Casola, and Mr. Morley for being here today. We hope your families are safe and healthy.

I want to start by asking a very simple question. How much money has the Infrastructure Bank received from the federal government to date, over the length of its existence, and what have been the operational expenses?

[Annie Ropar]

I can take that question.

We can divide up the appropriations between two parts. There are capital appropriations, which are amounts that are funded for investments. As of the end of Q3 of the 2019-20 fiscal year, which is the last set of financials we have published, that totals just over a billion dollars. Obviously, that was in support of the REM transaction.

In terms of operating costs and expenses, the most recent fiscal quarter, this would be December 31, 2019, the total operating costs are roughly about $16.6 million on that front.

I want to point out that obviously that is the cost side of the equation, but there is also a revenue side to the equation. As of the end of Q3 of that same period, we roughly have about $9.7 million in accrued interest revenue on our transactions.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

So $16.6 million a year, or $16.6 over the last two years?

[Annie Ropar]

I'm sorry, that's just for the year-to-date fiscal Q3, December 2019. Last year, our full year fiscal expenses were about $11.4 million, the last fiscal year ending March 2019.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Pierre Lavallée stepped down after 24 months at the Infrastructure Bank. Can you confirm that he received a bonus of $720,000 when he stepped down in April?

[Annie Ropar]

Just to back up on that question, it's important to note to the committee that our CEO's base salary is disclosed via the OIC appointment, and that is disclosed on the OIC website.

In addition, to give people the colour around our transparency, we do disclose in our annual report, under our key management personnel notes to the financials on an aggregate basis, total compensation paid to the executive team as well as the board of directors.

Unfortunately, I cannot comment on a specific individual's payments or terms, as these are subject to confidentiality, obviously, of their employment agreement.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

François Lecavalier stepped down after 12 months in December. Nicholas Hann stepped down after nine months about 11 months ago. Could you confirm that bonuses were paid in their departures as well?

[Annie Ropar]

Again, all of our disclosures around compensation appear in our notes to the financial statements, but I cannot comment on the specific terms of any one individual's employment agreement.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

The Auditor General just appeared before us and stated that she is auditing the Infrastructure Bank, including the issue of executive bonuses, and that she would be sharing that information and recommendations directly with the Infrastructure Bank. Can you commit today to releasing that information to the finance committee when that audit is completed?

[Annie Ropar]

Right now we are in compliance with all of our disclosure requirements for all financial aspects of our cost structure at the bank in accordance with current Treasury Board and Financial Administration Act guidelines. Obviously, the Auditor General, along with the private sector auditor, BDO, audits us on an annual basis and goes through all of the HR matters. They go through all of our disclosures and whether or not we've met the requirements under the Financial Administration Act. I'm happy to say that we've had clean audits to date.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Thank you, but that wasn't my question. My question is: Will you share that information with the finance committee?

[Annie Ropar]

In our notes to the disclosures to the financial statements, once our annual report is submitted, which will be shortly, those notes to the financial statements will disclose, again on an aggregate basis, the compensation of the executive team as well as the board of directors.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

I'll take that as a no.

Could you indicate what the staff turnover has been, at least anecdotally? Within the executive suite that turnover has been 100% over the last 11 months. What has been the overall staff turnover? You mentioned earlier, Ms. Ropar, that there are 50 people currently working in the Infrastructure Bank. What has been the staff turnover since its inception?

[Annie Ropar]

Maybe I'll also preface that to give you a little view on the number of people we've had along the way.

On March 31, 2019, we had 35 people. Now we're roughly at about 50 people. In the last fiscal year, our turnover rate was just about 17%. We had the two departures of executives and then a small number of people at the more junior levels.

Obviously, with a small organization, any departure will create a larger percentage impact on a turnover number.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

You've announced five investments in two and a half years, so that's once every six months on average. Of those five investments, a number of them, of course, had already been announced. Can you confirm to us how many of these five projects had already been announced as receiving funding from the federal government before the Infrastructure Bank took them on?

[Annie Ropar]

I'm sorry, are you referring to the 10 projects that we had specifically—

[Peter Julian, NDP, New Westminster—Burnaby, BC]

No. You have five projects that you have indicated specific financing for. I'm not counting memorandums of understanding or—

[Annie Ropar]

I see.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

This is just in terms of the five projects where funding has been announced and there are concrete figures. Of course, REM, as an example, had already been announced as being funded by the federal government, so how many of the five had already been announced by the federal government before the Infrastructure Bank then re-announced, with federal government funding, supports for the projects?

[John Casola]

Could I help with that question?

[The Chair, Liberal, Wayne Easter]

Go ahead, John.

[John Casola]

I don't think any of them had—not to our knowledge. REM was the only one.

The other announcements with dollar numbers attached to them are Mapleton, Contrecoeur and the GO RER in Ontario. I'm not sure if I'm missing one. I think that's it with dollar numbers attached.

To our knowledge—to my knowledge, I'll speak for myself—none of those had any commitments from the federal government attached.

[The Chair, Liberal, Wayne Easter]

This is the last question.

Peter, we've let everybody roll along here in this first round, so you have time for one more.