Government Operations Committee on March 24th, 2009

[Chris Warkentin, Conservative, Peace River, AB]

Thank you, Mr. Chair.

I have a number of questions. I'll start with Ms. Jen or Mr. Hirst. I don't know whether you would know the value of land that Public Works or Canada Lands Company currently own that is facilitating no valuable contribution to the federal government or to Canadian taxpayers. Is there any assessment of how much land or how many vacant or unused properties the government currently owns?

[Bob Hirst]

We have something called the directory of federal real property, and all departments contribute information to that directory. In that context, the departments identify lands that are surplus to their program requirements. There are about 1,000 of what I described earlier as routine properties; those are lower-value properties. In terms of strategic properties, for which we get Canada Lands Company involved, we're looking at about 15 or 16.

[Chris Warkentin, Conservative, Peace River, AB]

Has anybody ever done an assessment of the current value of those vacant and unused properties?

[Bob Hirst]

We have not. No, I don't think so.

[Shirley Jen]

We don't capture, in the directory of federal real property, the value of each individual parcel. As you can well imagine, we have in the directory roughly 45,000 buildings owned and leased, and there are about 25,000 properties. The only time you would estimate the market value of a property is when you in fact have a reason to get an appraisal. The reason for getting an appraisal would usually be that you recognize it's no longer required for your department for delivering the service. You would then go out, as per our directive, to get a market value appraisal.

[Chris Warkentin, Conservative, Peace River, AB]

I know of some land personally that the Government of Canada has held for no apparent reason. I've done some digging, and my understanding is that the government has no long-term objective to ever develop or to use that land again. I was curious, because it is located in a place where development could take place if it were handed over to the private sector. Maybe we'll have a conversation at some point about that.

I know there are farmers whose farms get so big that they forget where all their land is, and maybe this is a case in which some department has forgotten that they own it.

[Shirley Jen]

I would say that there are some properties that have been offered for sale on the market for which there are no takers.

[Chris Warkentin, Conservative, Peace River, AB]

Right.

In regard to the strategic review discussion—and I'll go to you, Mr. Smith—am I to understand that this review is purely a program review?

[Alister Smith]

That's correct.

[Chris Warkentin, Conservative, Peace River, AB]

It doesn't look into the effectiveness of procedures and policies across departments? Is it simply a lowest-value or lowest-performing program?

[Alister Smith]

It's very much program-focused in departments, looking at the effectiveness of programs and their relevance and their performance.

[Chris Warkentin, Conservative, Peace River, AB]

Is there any review process that would look at the mechanics of government or the mechanics of the relationships between departments or segments of departments involved?

[Alister Smith]

Those kinds of questions deal with machinery issues, and they are very much the purview of the Prime Minister and the Privy Council Office: whether government is configured properly or whether there are better ways of moving programs from one place to another. They don't really figure into strategic reviews.

[Chris Warkentin, Conservative, Peace River, AB]

It's my sense, and I know some of my colleagues probably share this opinion, that government has the ability to grow simply by its nature. It sometimes has a problem, so there is a new agency or a group of people who are developed to solve that problem, but we never see that group of people disintegrate. That entity continues long-term, and their budgets continue to grow, because although they were created for a purpose that was short-term, we sometimes see those things continue and grow and develop.

The chair and I had the opportunity to sit on another committee, and our concern with what we were looking at was that there was a sense that there might have been an alternative way to solve a problem. It might have been less costly, but because the different departments don't always talk to one another, we were required simply to give one department money, although a more comprehensive solution might have been found to reduce long-term spending. Is there no review taking place by Treasury Board or different departments in that vein?

[Alister Smith]

Within the format of strategic reviews, we do look at the relevance and performance of individual programs. We can, in fact, use this vehicle over time to do horizontal analyses of certain types of programming that are in different departments. It's a bit more complicated, but more and more, I think, we now have the tools in terms of performance indicators, evaluation, and our program activity architecture to start to do that work.

It's more challenging, because one has to look at, for example, aboriginal policy or environmental policy across a number of departments. That could give rise to some conclusions or recommendations for where best to have a particular program, which programs are redundant, or where there's overlap and duplication, but I think that's really down the road for us. It's more difficult.

[Chris Warkentin, Conservative, Peace River, AB]

I recently learned that the City of Ottawa has an unlisted phone number that was given to all of the people who work for the city. Basically it was set up as a hotline, whereby people who work within the city were able to call in and report places where they felt that waste or inefficiencies were taking place. It's been so successful, in fact, that they've decided to expand it to allow the general population to access this phone number and suggest places where efficiencies could be made.

Do you know of any type of process or any type of mechanism such as this one that is in place government-wide or that may even be in particular departments in order to accomplish that type of effort?

[Alister Smith]

I'm not aware of any such mechanism within government. Here, I would also emphasize that with strategic reviews the focus has not been on administrative costs either, or on savings that could be obtained through cost-cutting across departments. It's very much a focus on programs, on whether they're working well, whether they're still relevant, whether they need to be better resourced, or whether there are excessive resources in certain programs.

But indeed, I think there's always a need to be careful of creep within government, where costs rise and there are inefficiencies. We do periodically need expenditure reviews to sort out some of those problems, but I'm not aware of any particular mechanism at the moment.

[Chris Warkentin, Conservative, Peace River, AB]

What was the last--

[The Chair, Liberal, Derek Lee]

That's eight minutes. I'm sorry. Thank you.

Mr. Dewar, for eight minutes.

[Paul Dewar, NDP, Ottawa Centre, ON]

Thank you, Chair.

I apologize for my voice. I've been the recipient of the head cold that's going around town.

Thank you to our guests for their presentations.

I will start with the finance department, Mr. Botham. Going back to what Ms. Hall Findlay was trying to establish here, I think part of the confusion lies in the way the numbers were presented, going back to the fiscal update and then of course the budget.

In the fiscal update, the finance minister himself did admit that his numbers were a bit rosy in terms of savings. He declared that at one point he was going to do the $4.3 billion in savings; he combined the two. The problem we're having, though, is that when it came to the budget and the way that was laid out, the charts were different. In the fiscal update, we had one set of numbers established one way and laid out one way, but in the budget it was a different way. I think that's probably part of our concern. It's how the numbers are laid out and therefore what exactly the targets are.

As well, there is still an outstanding question for the government as to what happens if they don't meet these savings and reviews and the sale of assets. It's not a question for you, but for the government.

But here's my question: if you're being asked--and I'll ask the same on reviews--to find a certain amount of money for assets, how are you being told to do this? Are you being told it's something that has to be done? Is it according to the criteria that it will be “a considered approach to the sale of any asset, including taking into account the condition of markets, to ensure that fair value can be realized by taxpayers and the transaction will generate additional economic activity”? As well, states the budget, “Assets will not be sold if such sales do not meet these tests”. That rolls off the tongue nicely.

Are you being told explicitly that if you don't meet this test, you don't sell the asset?

[Richard Botham]

Yes, I think that's an accurate statement. The corporate asset review starts from the premise that the government's assets should be reviewed; that the management of those assets should be brought up to date; that there may be opportunities to improve the management of those; that there may be opportunities to generate more economic wealth for Canadians from the management of those; and that in some cases that may mean having an asset owned by the private sector that's currently owned by the government.

And the process—

[Paul Dewar, NDP, Ottawa Centre, ON]

No, no, I appreciate that. I understand that part; I was asking about when you can't, and you answered it in the first sentence. I appreciate that.

Basically, if you can't meet this test, you shouldn't recommend selling the assets. As a public servant, this is the direction you were given. I just quoted from what you had in your speech. Certainly it's what I read from the budget.

Would the same apply in terms of a review? I'm concerned here; I actually sit on the foreign affairs committee, and many of us are more than displeased about the fact that the department has been cut. I'll say “cut”; you'll say it differently, and I understand that.

The point is that when a government says we have to meet these targets, they have one of two choices. They can either go and find the money or they can eat it--i.e., a deficit. That's where we're concerned.

You're being told as bureaucrats to go and do these reviews and identify the assets. My question--it's not about methodology here, I understand that you were very comprehensive--concerns the operational side. Do you go into a department and say, “We need to find this amount”? Is that how it works?

[Alister Smith]

Mr. Dewar, it doesn't work that way for strategic reviews. The departments themselves propose, and are required to propose, reallocations that are up to 5% of their direct program spending base. We determine the base. In that sense--

[Paul Dewar, NDP, Ottawa Centre, ON]

So it's 5%. But you were directing them to find 5%. Their review said “required”.

[Alister Smith]

Right.