Thank you, Madam Chair and committee members.
Thank you for the opportunity to appear before you today on behalf of the Public Service Alliance of Canada. Joining me this afternoon, as Madam Chair mentioned, is Mike McCracken. Mike is the chairman and CEO of Informetrica. His firm is a privately owned Canadian company specializing in quantitative economic research.
PSAC commissioned Mike's firm to analyze phase one of the real estate plan. It will surprise no one that we think the sale and leaseback of several properties owned by the people of Canada was a bad deal for citizens. Mike has also concluded that it is a bad deal for taxpayers.
In a moment, Mike will brief you on the highlights of his analysis, but first let me outline some of our general concerns with the sale and leaseback of the initial set of properties. Because virtually no details are publicly available about phase two of the real estate plan, it is difficult to comment on it. All we can do is examine the recent transaction and anticipate what phase two might bring.
Our concerns are rooted in the belief that the sale of these assets is akin to the privatization of public space. In a world where Canadians are bombarded virtually every waking moment by commercial messages, images, and values, the loss of any public space is a very serious matter.
In a real sense, these buildings are the bricks and mortar of public services PSAC members deliver to Canadians. It is our view that the sale of these properties further diminishes the role in leadership of the Canadian government in our communities and is in keeping with the view that less government is better government.
The properties in question belong to the people of Canada. As our representatives, your committee has properly objected to the secrecy adopted by the government when it came to conducting the sale of these buildings. Your call for a moratorium on the sale was entirely appropriate and prescient, given the Federal Court injunction in relation to the Musqueam Band's objection concerning its unresolved land claim.
Information this committee demanded was withheld. Canadians were kept in the dark about the government's plans to sell our property. Some but not all details related to the sale have since been released, but only after the transaction was announced. If one is to encourage good behaviour through praise, then the government deserves credit for this limited release, but key documents remain secret, the Larco lease among them.
In fact, the most important details, the real numbers contained in a prospectus prepared for bidders called “The Confidential Information Memorandum”, continue to be withheld to this day. The confidential information memorandum contains a description of every property. It provides the details a potential bidder would need to craft an offer to purchase. It includes a statement of net operating income. It outlines operating expenses, taxes, management fees, parking income, and the like. It also includes a detailed schedule of capital improvements the new owners will pay for.
Without the details contained in the confidential information memorandum, it is impossible to properly evaluate the sale. I dare say, Public Works has probably withheld this confidential document even from government members of this committee.
Vague assurances that this is a good deal are not good enough. When you see the numbers, I believe you will quickly come to the same conclusion that Informetrica has reached: that taxpayers lost big time in this transaction.
You might be wondering, “How does she know?” The truth is PSAC obtained a copy of the confidential information memorandum. We were given the document on the condition that we keep it secret. For this reason, unless the Minister of Public Works releases us from this undertaking, I cannot at this time give you the document, but we can and will brief you on our analysis of it, and I will now ask Mike to do just that.