Government Operations Committee on Feb. 26th, 2008

[The Chair, Liberal, Diane Marleau]

I would like to call the meeting to order.

I'm going to welcome our witnesses, along with their legal counsel.

I would ask that the cameras leave, now that the meeting has been called to order.

Before we start, now that the cameras are gone, as you know, there are some legal things happening over this particular issue. I will tell you in advance that I will not allow any questions that deal with whether there was a breach of contract on behalf of the City of Ottawa with regard to the O-Train. That is before the courts, and that will not be a question I will allow. As for the others, we'll take them one at a time, and at that point we'll rule.

I would like to start by having our guests identify themselves. You can introduce yourselves. Counsel can introduce themselves as well, for both parties, so they know who you are. Welcome to Parliament Hill, and welcome to this committee.

I've also asked the witnesses, if they wish, to give a brief statement, and then we will go directly to questions from different parties.

Who would like to be first, and who would like to introduce? Maybe we'll have Mr. Wouters. You're more familiar with this.

[Wayne Wouters, Secretary of the Treasury Board]

Thank you. I am Wayne Wouters, Secretary of the Treasury Board.

[Michel LeFrançois, General Counsel, Secretariat Legal Services Branch, Treasury Board Secretariat]

My name is Michel LeFrançois and I am an employee of the Legal Services of the Treasury Board.

[Kent Kirkpatrick, City Manager, City of Ottawa]

Madam Chair, I'm Kent Kirkpatrick, city manager, City of Ottawa.

[Réjean Chartrand, Former Director of Economic Development and Strategic Projects at the City of Ottawa, As an Individual]

Hello.

My name is Réjean Chartrand, former employee of the City of Ottawa.

[Peter Doody, Legal counsel for the City of Ottawa, Borden Ladner Gervais LLP]

I am Peter Doody, legal counsel for the City of Ottawa, and this is Mr. O'Connor.

[Rick O'Connor, City Solicitor, City of Ottawa]

I am Rick O'Connor, city solicitor, City of Ottawa.

[The Chair, Liberal, Diane Marleau]

I will say to the committee that the representative from Siemens has not been able to free herself to come forward. My understanding is that she can come at a later date. Perhaps I'll let the clerk explain what he's done in order to get in touch with Ms. Wessel, of Siemens.

[The Clerk of the Committee, Mr. Michel Marcotte]

Thank you, Madam Chair.

Ms. Wessel couldn't be here with us today, but she indicated to me that she might be available Tuesday, March 4, or next Thursday, March 6. And that's about it. Otherwise, it's going to be at the end of April. Seeing as we've already had a motion that we will have two meetings next week on a different topic, I told her that we would wait for the committee's decision on whether we're going to invite her again.

[The Chair, Liberal, Diane Marleau]

Thank you.

Perhaps we can now move to remarks from witnesses. I believe that Mr. Wouters has something to say.

[Wayne Wouters]

Thank you, Madam Chair.

Good morning, members of the committee. I have a bit of a cold, so if you could, bear with me here today.

I am here today to speak to the role of the Treasury Board of Canada and of the Secretariat in the matter of the federal funding for light rail transit project in Ottawa.

Before I do so, I want to clarify that I am here in my role as Secretary of the Treasury Board, which is a cabinet committee. As such, I am limited in what I can talk about. Particularly, I cannot discuss cabinet confidences. These include submissions to Treasury Board, board deliberations themselves, and board decisions. I'm also not at liberty to discuss legal advice that may have been provided, as this remains solicitor-client privileged.

To provide members with some context, I believe it would be useful to set out the role of Treasury Board and of the Secretariat during the submission process.

The Treasury Board is a committee of ministers, chaired by the President of the Treasury Board. As the government's management board, it has three core roles: it promotes improved management performance through its role as the government's management office; it focuses on smart spending through its budget office role; and it's also the principal employer of the public service.

While other cabinet committees approve broad policy directions or new policy initiatives, Treasury Board approves the program design, implementation plan, and specific costs that will achieve the policy objectives. A Treasury Board submission is the official document submitted by a minister on behalf of his or her department to seek the necessary approval or authority from Treasury Board to undertake an initiative that it would not otherwise be able to undertake or that is outside its delegated authorities. It is the role of Treasury Board Secretariat to provide sound advice to ministers in their consideration of Treasury Board submissions, and to do this the secretariat works closely with departments.

Following consideration of a submission by Treasury Board, the secretariat provides the department with a formal record of decision. Treasury Board has four decision options for submissions: approve as proposed, approve with conditions, not approve, or defer the decision.

The Ottawa north-south light rail transit project is one of Canada's strategic infrastructure fund projects. These projects are selected by the Minister of Transport, Infrastructure and Communities in consultations with provinces, territories, and municipalities as appropriate.

The Minister of Transport is also responsible for undertaking the due diligence on the project and negotiating a contribution agreement--in this case, with the City of Ottawa.

Treasury Board Secretariat becomes involved in these projects once a contribution agreement has been negotiated. Treasury Board ministers are the only ones who can authorize signature of contribution agreements under this fund; therefore, submissions seeking final approval for the contribution must go to Treasury Board. This submission must be considered before a contribution agreement can be signed.

From a Treasury Board perspective, the Ottawa north-south light rail transit project submission was typical of any of the projects brought forth for consideration under the Canada strategic infrastructure fund program.

I've given you this background on the Treasury Board submission process and on the process of selecting Canada's strategic infrastructure fund projects. My goal in doing so has been to provide members with a better understanding of the role of the Treasury Board ministers and of the secretariat in reviewing the submission relating to the Ottawa north-south light rail transit project.

As I've explained, cabinet confidentiality precludes me from being able to mention the date of a Treasury Board meeting or providing you with information on a Treasury Board decision; however, as this information has already been made public, I'm able to state that the decision of the Government of Canada to approve funding for the north-south light rail transit project in Ottawa was made as a result of a submission presented for the consideration of the Treasury Board ministers emanating from the Minister of Transport, Infrastructure and Communities. In this matter the Treasury Board decided that the Minister of Transport, Infrastructure and Communities was authorized to enter into a new contribution agreement with the City of Ottawa for up to $200 million to construct the proposed north-south light rail transit project subject to ratification by the new city council.

As the City of Ottawa is an important party in the project, the president asked me to inform the city of the decision. I did so in a letter to Mr. Kirkpatrick, city manager, on October 10.

This concludes my remarks, and I'm prepared to answer any questions you may have.

[The Chair, Liberal, Diane Marleau]

Before I start, you said that you cannot make any of these decisions public. What about the last decision that Treasury Board made? Can you make that one public, because it is in the public domain?

[Wayne Wouters]

That is in the public domain, and as I already stated, it was in a letter that I sent on October 10 to Mr. Kirkpatrick. As I said, that decision was one where the Minister of Transport, Infrastructure and Communities was authorized to enter into the agreement to provide funding up to $200 million to this light rail project. That was conditional on the Minister of Transport receiving ratification by the new city council that they supported the project.

[The Chair, Liberal, Diane Marleau]

Was that dated?

[Wayne Wouters]

Yes, it was dated October 10, 2006.

[The Chair, Liberal, Diane Marleau]

Are there any other submissions by any of the other witnesses?

[Kent Kirkpatrick]

Madam Chair, on behalf of the city representatives I would just say that we are happy to be able to respond to your request to be here today. We will answer the questions that are posed to us to the best of our ability, the only exception or issue being what you raised at the outset, which is that there may be some questions that I will need to consult with counsel on vis-à-vis how those questions may or may not affect the city's interest in terms of responding to the legal claim we're currently responding to. But other than that, we are here to do our utmost to answer the questions to the best of our ability.

[The Chair, Liberal, Diane Marleau]

We'll start with Mr. Holland.

[Mark Holland, Liberal, Ajax—Pickering, ON]

Thank you, Ms. Chair, and thank you to the witnesses.

Our time is tight today, and my questions will be direct, so if we could have the most concise answers possible, it would be appreciated.

I'm going to start with the Treasury Board, and then I'll go to the municipal officials if I have time in this round or in a subsequent round.

I want to ask Mr. Wouters this. Can you tell the committee how many federal departments would have been involved in the sign-off process leading up to the final submission to Treasury Board on the light rail project?

[Wayne Wouters]

I'm sorry, I can't answer that question regarding the number of departments involved in the project, but the Department of Transport, Infrastructure and Communities was the lead department for this particular project.

[Mark Holland, Liberal, Ajax—Pickering, ON]

Maybe I could ask either Mr. Kirkpatrick or Mr. Chartrand if you're aware of how many federal departments had signed off on this project prior to it getting to Treasury Board.

[Réjean Chartrand]

Actually, through the environmental assessment process, there were seven different departments that had to sign off on the project, and we also worked very closely with the Canadian Transportation Agency, which was providing its approval on this.

[Mark Holland, Liberal, Ajax—Pickering, ON]

Correct. Is it not correct as well that Minister Cannon himself signed off on this project?

[Réjean Chartrand]

Through my colleagues at Transport Canada, we understand that the minister was fully supportive of this project and that he did submit positively to Treasury Board.

[Mark Holland, Liberal, Ajax—Pickering, ON]

I'll go back to Mr. Wouters, if I could. Can you tell me if any federal departments, of the seven that were involved in approving it up to the point at which it got to you, had ever expressed concerns about the project to Treasury Board?