Government Operations Committee on March 24th, 2009

[Martha Hall Findlay, Liberal, Willowdale, ON]

So it's safe to assume about $2 billion a year over five years?

[Richard Botham]

No, I think the number you're looking at for the $10 billion is both cumulative for the corporate asset review and for forward projections on the strategic review, taking into account the savings that would be built in each year based on the results of the review.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Can you confirm for me, then, the global number we're looking at just for asset sales? I'm trying to get a handle on our concern. We're not trying to hide anything here. We are concerned there is a commitment that this government will see revenue attributed to asset sales. These assets have not yet been identified. We don't know that these assets, on the occasion of their sale, will generate that amount of money. We are concerned about the challenge of establishing a number without knowing what the assets are, without knowing what the market is, and—in particular in the current economic situation—whether this is the right time to be selling any assets at all.

Maybe I can help you with why I'm asking the question. I want to get down to what the government is expecting in terms of revenue in terms of asset sales. I will follow through with asking what those assets are. Apparently, no assets have been identified. I'd like a sense of the timing of when those assets will be identified.

I'll leave that with you, if you could help me with those two bits so far, recognizing that we're all very limited in time and that's why we have to be fairly firm in our questioning.

[Richard Botham]

Sure, that's fine.

The amount for revenues from corporate asset reviews for 2009-10 is $2 billion.

[Martha Hall Findlay, Liberal, Willowdale, ON]

I'm talking about all assets. I'm assuming that's corporate as well as real estate, right?

[Richard Botham]

That would be the anticipated revenues as a result of the corporate asset review, which looks at both assets defined as crown corporations as well as real property.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Okay. Thank you.

[Richard Botham]

The question you also posed in terms of timing--

[Martha Hall Findlay, Liberal, Willowdale, ON]

I think we'll just leave it for now that there's a lot of money at stake. I'm still not completely clear on what the expectation is in terms of dollars.

Now I will go to the concern about saying we're going to see this revenue from assets that we haven't yet identified. In your presentation you referred to identifying a shortlist of those assets early in the fiscal year. The fiscal year is about to start. Again, you can't see that revenue if you don't sell those assets, and you have to identify those assets before you can sell them.

Can you give me a better idea of when you expect to see that short list of assets, both corporate and real estate?

[Richard Botham]

I don't think I can be more precise than it being the first quarter of the fiscal year.

The process we have initiated for the corporate asset review really just started in the last couple of weeks. We have started to talk to departments to make them aware of the objectives of the exercise. We're starting to work with them so they can identify a comprehensive list of the assets within their portfolios. Once we have established that baseline, we will be working with them to apply policy-relevant, significant tests so that, between the two of us, we identify a short list of those specific assets that would merit further analysis.

I would suggest that a short list will be developed sometime early in the summer, so within the first few months of the fiscal year.

[Martha Hall Findlay, Liberal, Willowdale, ON]

If you identify assets early in the summer that the government may be willing to sell, needless to say there will be a significant lag time, especially in these economic times, before you necessarily find a purchaser. I'm just noting that this is a longer process, perhaps, than being able to book a couple of billion dollars in the next fiscal year.

Another question is--

[The Chair, Liberal, Derek Lee]

I'm sorry, we're at eight minutes now.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Okay. Thank you.

[The Chair, Liberal, Derek Lee]

Ms. Bourgeois, you have eight minutes.

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

Thank you, Mr. Chairman.

My first question is to Mr. Botham.

Mr. Botham, I would like to come back to some of the questions raised by my colleague about a list of property that could be sold. When people from your office appeared before our committee in 2007, we were told that some 40 buildings that belong to the government were to be sold. Seven of them have in fact been sold. That leaves some 30 buildings. At the same time, we were told that there was no list of the buildings that were to be sold. The list was being worked on, but no one really knew what buildings were on it.

That was almost two years ago. I find it rather unusual that we still cannot see this list of public property that could be sold.

I would also like to ask you a question about the famous 30 government buildings that were supposed to be sold in 2007. Is the process underway? Will they in fact be sold?

[Richard Botham]

I don't think that is something I have enough expertise to comment on, not having been involved in that process at all.

Maybe my Treasury Board colleagues are able to comment on the sale of real property.

[The Chair, Liberal, Derek Lee]

Ms. Jen.

[Shirley Jen, Senior Director, Real Property and Material Policy Division, Treasury Board Secretariat]

Ms. Bourgeois, I think the 40 buildings to which you are referring belong to the Department of Public Works and Government Services. These buildings are only some of this department's holdings. We are not in a position to answer the question about the future of the other 30 buildings.

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

I find it rather unusual that you cannot answer the question. After all, you are from the Treasury Board Secretariat and the Department of Finance. I imagine you must be aware of what is going on. The sale of the seven buildings brought in $1.4 billion. You must be aware of what is happening with these buildings. The study did cost some $400,000. You will remember that—there was an issue about banks, and so on.

My questions are now for the Treasury Board representatives. Together with the departments, you are going to be doing a strategic review of program spending. It states here that there was an expenditure review process in 1994, 2003, 2004 and 2006. I thought departmental expenditures were reviewed every four years and that the purpose of the review was to check whether the strategic plan had been followed.

Why are you doing another review in 2008-2009?

[Alister Smith]

There have been, in the past, many different types of expenditure reviews, dating back, as you said, to the mid-nineties and even beyond, and they all had different characteristics and were required for different reasons. Sometimes they were indeed cuts exercises.

In the last two rounds of strategic reviews, however, we've taken a different approach. That approach is intended to be strategic in the sense that it's a comprehensive review of all program spending in a department that's undertaken with a view to potentially recycling funds to better-performing programs or other needs in that department or other departments. So it's not undertaken with a view to cuts or to raising money or to balance the budget, which was the case in the mid-nineties. It's undertaken for other purposes. In that sense, it's more strategic.

It's not a review of strategic planning, per se, either. It's really just a review of the value for money of current spending. That was in fact precipitated by the views of the Auditor General and indeed the views of parliamentary committees, such as the public accounts committee and this committee, that we need to be able to review, on an ongoing basis, the value for money for government spending.

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

When you do a review of the type you are about to undertake, I imagine you base the work on what you did before. No review can be done without knowing whether the department followed indicators having to do with time, performance and so on.

For several years now, the Auditor General has criticized the lack of planning and performance and time indicators used in a number of departments. I have a few of them here. You say that you want to conduct a review to check whether the program has produced satisfactory results, but you must know that I am very skeptical about this.

How will you go about conducting this audit?

[Alister Smith]

You're quite correct that there has been an emphasis by the Auditor General and others on the need for better program evaluation and performance management information. And indeed, strategic reviews are intended to build on that kind of evidence base in coming to decisions as to where funding should be better deployed.

So it's very much in line with this that we are trying to build up both the performance management side, performance indicators in departments, and the evaluation side. We have a new evaluation policy, which is moving to a full evaluation of all programs over a five-year period once the new policy is fully phased in. We're trying to encourage, every year, better performance indicators in departments. We have these performance indicators in our RPPs and DPRs, departmental performance reports, and departments are required to report on them; it's mandatory.

So we are indeed moving in exactly that direction.

[The Chair, Liberal, Derek Lee]

Thank you.

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

Is my time up already?

[The Chair, Liberal, Derek Lee]

Oui, c'est huit minutes.

We go to Mr. Warkentin for eight minutes.