Government Operations Committee on Dec. 10th, 2007

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

Actually, for the record, the Liberals haven't asked a single question on polling in the House. I didn't respond to you or any other Liberal on the issue of polling. In any event, the minister has dealt with that effectively and I won't belabour it.

My question is that Paul Dewar had a substantive question on the issue of the former JDS Uniphase campus, and maybe Tim can give us an update on that, because that's actually an important case study of an example of why the government isn't in the business of owning buildings and seeking out real estate opportunities to buy and reno and flip. We're not in that business, because it's a dangerous business.

There's the headline in the paper that said we could have had it for $30 million, or whatever, and now it's expanded into a few hundred million dollars. But that's not at all accurate, because if we had purchased it in the beginning, there would have had to be renovations and security, and there are all kinds of things with that.

One way of looking at a lease is the owner is taking on the obligation. When you lease a building, the taxpayers aren't on the hook if the federal government doesn't own the building. If you're leasing a building, the costs of the fix-ups of the building are absorbed by the owner and it's amortized over the life of the lease. Therefore, if the government had purchased the JDS Uniphase building, even at the original price before the Conservatives came into government, the immediate hit to taxpayers would have been tens of millions of dollars for the cost of a retrofit right off the top, rather than amortizing that cost. This is good business.

It's in Mr. Dewar's neck of the woods, and people here want to know about the status of the JDS building, so just go ahead and talk about that if you would.

[Tim McGrath]

Sure.

Madam Chair, on that particular transaction, Minto Developments Inc. are responsible for providing us accommodation at the Government of Canada standard. That will cost them anywhere from $27 million to $32 million, which they're responsible for and which they will be funding. We, in turn, are funded for our normal fit-up costs, and our normal fit-up costs for that particular asset will be around $100 million.

Comparing the total cost package of the JDS Uniphase on the present value basis versus what we would have had to do at the existing RCMP facility, the retrofit and the fit-up of that, is showing a net advantage to taxpayers of around $100 million in that particular transaction.

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

Where are we in terms of the time? The current RCMP headquarters is--

[Tim McGrath]

The RCMP have already started to occupy the asset. The plan was that they'd be occupying it as construction was taking place over a two-and-a-half-year period. They've already started to move various groups in, and construction work is continuing on that particular building.

[James Moore, Conservative, Port Moody—Westwood—Port Coquitlam, BC]

Is there a firm timeline for completion, and what about the current RCMP headquarters?

[Tim McGrath]

The timing for completion is June to August 2008 when everybody will be in that building, and we're still on course to be ready for that particular asset.

Once that building is empty, the campus itself, we will be looking at various reuses for that existing campus in the Alta Vista area. If you look at where it's situated right now, the one thing the RCMP was most pleased with is the fact that it takes that highly secured facility out of a residential area. If you see where the current RCMP headquarters is, it abuts right up to a residential neighbourhood in Alta Vista, and based on the new security requirements and in conjunction with agreements with their U.S. counterparts, they needed to have a facility that provided a 100-metre setback from any roads. This existing facility of JDS provides that heightened security as well.

[The Chair, Liberal, Diane Marleau]

Thank you.

I'm going to take the prerogative of the chair. No one has asked this question, but this is a pet project of mine. It's about employee compensation.

The last time you appeared before the committee you had a tremendous backlog of issues on compensation. I'd like to know what's happening within the public works department on compensation at this time. How big is the backlog?

It's of great interest to us, as you know, and I know that you do a lot of it yourselves.

[Michael Fortier]

The backlog is actually much, much smaller than it was. As I explained at the time, we had a personnel issue in the sense of training people to do the compensation. We had people working overtime. We had outsourced part of the job. Literally, we were trying to get more people thrown at the problem, and we managed to do that.

Currently, there probably are some cases that haven't been dealt with, but at this point I would say, de minimis, we've really dealt with a very large segment of the backlog, and I'm hopeful that in the very near future this won't be a problem.

François.

[François Guimont]

Madam Chair, if I remember, I signed off a letter to you—or it might have been from the minister, frankly, going through my office—giving you the latest statistics. So the minister is accurate in what he said, actually. I don't think we have a backlog anymore, but I could be wrong. We are on target with what was promised before the committee, as a first point.

The second point is that we are also dealing with what I would call the deeper root cause of this, in pursuing with the minister a so-called pay modernization approach. We're trying to invest or get support for investments into our backroom systems, which are very old, 40 years old. We're trying to get an investment so that we can optimize our system with off-the-shelf technology, and that would address the root cause, in reality, of what we're facing. So we're also pursuing that strategy.

[The Chair, Liberal, Diane Marleau]

There are other ways of dealing with people you're trying to hire and keep. My information is that oftentimes by the time you have them trained, they're not going to get paid enough for the amount of pressure and work they have to do, and they go on. So in some departments, it continues to be a major problem, but others have found a way to address the pay issue by moving the categories, say, from AS-1 to AS-4.

Has the Department of Public Works considered doing this to help retain some of the employees? It does take a long time to train them, and once you've trained them, you'd like to retain them.

[François Guimont]

Yes.

I have just two points on this.

I took the time to sit down with the staff, those individuals who are working hard to get rid of the backlog and also ensure that our statistics on the way forward are good—that is, you always have people leaving, and so on. So I showed some commitment in listening to them, and we had a bit of a chat.

I'm not saying that the issue of salary is off the table, but very often what I heard more, at least in the case of Public Works, is that because of the backlog, they face a lot of pressure in terms of work. Frankly, I'm being very transparent. I said, “Hang in there; let's try to do what we can right now.” I hope people will get overtime, as they should. Let's try to get over that bump and then stabilize ourselves by investing in a system long-term that will depressurize the system, not only in Public Works but also in other departments.

In reality, the situation faced in Public Works is not unique. What is unique in our case is that about one-third of our workforce, for whatever reason, left almost at once, which created the issue. Any other department is using our system as a centralized system, and if they also were to lose some of their people, they could face the same situation that we faced.

Going back to the core issue of a properly designed new system is imperative, otherwise that curve is always possible, that some people move, they go to another department, and so on, or they simply move out of that field to do something else, and then the pressure can creep up again. We have to go to the root cause, which is reinvestment in our pay modernization system.

[The Chair, Liberal, Diane Marleau]

Thank you very much.

Thank you for coming before the committee.

I will advise the committee that we will be hearing from Madame Boudrias exactly on the payroll issue on Wednesday. She's one of our witnesses.

We remain to be convinced. Thank you.

The meeting is adjourned.