Government Operations Committee on March 24th, 2009

[Alister Smith]

Yes, all of those dependent on appropriations do comply, certainly.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

So that means that the strategic review is given a great deal of importance. Without wanting to diminish the work that you are doing, we should be giving a great deal of importance to the implementation or to the planning of the program and the results. You are a sort of external auditor. Consequently, we should be asking the departments the real questions.

[Alister Smith]

I think that's correct, because, really, the deputy and the department are the ones who know their programs best. They are the ones who are responsible for ensuring that programs are effective, that performance criteria are respected, and results are achieved and outcomes are....

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Earlier, you agreed with me that the Auditor General of Canada had criticized the lack of planning done in a number of departments. That may be the cornerstone of our line of questioning. When planning is not followed properly, and there is an overlap between two programs, we cannot say whether one program is better than the other or that the other one is obsolete, for example. That is where we can save money. You are not going to be able to achieve the savings, but the departments concerned can.

[Alister Smith]

Absolutely, I think better planning is always better for departments. Indeed, there may be ways in which a department on its own, without the requirement of a strategic review, can achieve better outcomes and more savings in terms of resources, absolutely. And planning would be important to that.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

We should really pay special attention to what the Auditor General said about planning. You can forget about the planning review, because the Treasury Board Secretariat determines whether everything has been done in accordance with the rules. But at the outset, if the foundation is not solid, if the planning has not been followed and the timelines and performance indicators have not been respected, there is a problem. Is that correct?

[Alister Smith]

Well, I would only add that I think it's useful to have that external process where ministers do come forward, having reviewed all their programs and determined that 5% of programs are not performing well or are not any longer as relevant as before, and bring them forward to their colleagues for consideration. I think that's still a useful discipline, over and above what might happen at the departmental level. So I still think it's really useful to have that kind of review.

[The Chair, Liberal, Derek Lee]

Merci.

Mr. Dewar, for five minutes.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Thank you very much for this clarification.

[Paul Dewar, NDP, Ottawa Centre, ON]

I just want to go back to the fact that we're looking at $4.3 billion and that the choices are to reaffirm that if we're not able to find it through the two methods we've talked about and outlined here, that really, there is only one other option for government, and that is to have it on the books as money it didn't find savings for, and therefore it becomes part of the deficit.

Is that how you would see it, Mr. Botham?

If in their books they book $4.3 billion in savings and then you make $2.3 billion, where does that $2 billion go? I'm just speculating here. Would it be rolled into a deficit?

Or some other miracle might happen, but just for basic accounting here, we would we see that the $2 billion hadn't been realized and it would be carried over to the next year.

[Richard Botham]

My presumption is that along with all the other revenue sources of the government, there would be a reckoning of what the pattern of that is over the fiscal year. If there were to be a shortfall on the $4.3 billion, then it would factor into the total revenue picture of the government and a calculation would be made at that point as to whether the government was in surplus or deficit.

[Paul Dewar, NDP, Ottawa Centre, ON]

Let's maybe just go back to the strategic review. I am looking at some of the numbers from 2007, and I'm looking at departments like CIDA and Foreign Affairs. I have them here, and I'm not going to do a quiz, but I'm looking at trends. We talked about 5%, but I'm looking at Foreign Affairs and International Trade, 2008-09, $73 million; for 2009-10, $92 million; then we get to 2010-11, $105 million.

Just taking a quick glance at these numbers--and then you'd look at other departments--you see a huge difference. I look at CIDA in a similar light. Disproportionately, they've managed to find all this money through the review process.

I guess I'd have to ask why it is that these departments seem to find so much in terms of “savings”. That's the first question.

The second question is, at the end of the day, that means this money will no longer be within that department to spend. Is that correct? I know the reallocation goes on.

[Alister Smith]

First of all, it is the scale of the departments. Indeed, when you say CIDA, you're really talking about the international assistance envelope, which is $3 billion.

[Paul Dewar, NDP, Ottawa Centre, ON]

Yes.

[Alister Smith]

And any savings or reallocations found there were simply recycled within the international assistance envelope, so there's no net savings in terms of aid. We recycled from one purpose to another within the international assistance envelope. Indeed, it's the same, to a degree, with DFAIT. You've cited the numbers, which are the reallocations--the $73 million, $93 million, $105 million profile--but there are also reinvestments of $65 million, $85 million, and $98 million--

[Paul Dewar, NDP, Ottawa Centre, ON]

I appreciate that.

[Alister Smith]

--so the net savings are fairly small. In fact it's a recycling of funds from lower-performing to higher-performing, and lower-priority to higher-priority within the department.

[Paul Dewar, NDP, Ottawa Centre, ON]

Proportionately, according to the department, I appreciate your point. Who decided which departments would be looked at? That's decided through the finance department--is that right?

[Alister Smith]

No. There is a process every year for determining which departments would be up for review. Over a four-year period, everybody will be up for review to cover 100% of program spending.

[Paul Dewar, NDP, Ottawa Centre, ON]

Right. I appreciate that.

[Alister Smith]

So it's a bit of a judgment call, because indeed you don't want to have only departments from one sector--international, heritage, culture, or economic--in one year. You want to have a bit of a mix. At the same time, there are advantages to grouping some departments, because indeed there are linkages.

[Paul Dewar, NDP, Ottawa Centre, ON]

I guess my question is who makes the decision?

[Alister Smith]

Ultimately, it's a cabinet decision.

[Paul Dewar, NDP, Ottawa Centre, ON]

Okay. Thank you.

I had a question about the assets that are going to be looked at. CCC, Canadian Commercial Corporation, is an interesting corporation. I'm just wondering, within the definition of what you've been given at finance, how would you consider CCC? My understanding is that CCC does get appropriations from government, yet it's also a crown corporation, and it does business, so to speak. Where would it fit in this family of assets?

[Richard Botham]

I do not know--