Government Operations Committee on June 14th, 2010

[Malcolm Allen, NDP, Welland, ON]

It certainly sounds as though you're doing a lot of work at HR. I just didn't get a number for what that critical mass is. I need to move on to something else.

In your budget, clearly there's money that comes from the tax base, and then there's other money that comes from a revenue base. For part of that, we have heard about how there are assets out there that perhaps may not stay on the assets side: they may be sold, or moved, or have other things done to them.

If indeed you do get rid of assets, whatever those happen to be, how will you account for the money you receive for the asset? What can it be used for within your department, if anything at all? Have you identified any of those assets that you may actually want to be disposing of?

[Andrew Treusch]

Insofar as we have capital assets in relation to our capital budget—and again, the capital budget is not affected by the operating fees—there are well-defined policies and procedures for the disposal of crown assets.

I'm not an expert in this vocation, but when a department or custodian declares that it no longer has a need for an asset, there's a policy to be followed whereby we ensure that it is indeed surplus to the Government of Canada, that there is no requirement for it. Then, as long as it is not a contaminated site or not the subject of an aboriginal claim, it may be disposed of at market rates to ensure a value for the crown.

That's a general review of what happens.

We do indeed, from time to time, have properties that are assets, and they can be disposed of. Sometimes we dispose of them ourselves, and sometimes that's done by the Canada Lands Company. It has a mandate here.

The important thing to note is that where there are revenues or proceeds from the sale of a crown asset, they do not accrue to the custodian department. They accrue to the consolidated revenue fund.

[The Chair, Liberal, Yasmin Ratansi]

You can have a very brief question, Mr. Allen. You have 30 seconds.

[Malcolm Allen, NDP, Welland, ON]

Have you identified any surplus assets?

[Andrew Treusch]

At any particular time, there are probably assets in our inventory that would be surplus to our requirements.

[The Chair, Liberal, Yasmin Ratansi]

Thank you.

We will now go to the last round of five minutes.

Ms. Hall Findlay.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Thank you, Madam Chair. I have just one very simple question, and then if I can I'll share my time with my colleague.

Mr. Treusch, you'll just have to bear with me, but I heard a number of numbers, and I heard a number of numbers about savings and what was actually being frozen or not. I remain just a little bit confused. I see a lot of line items in the description of the comparison of 2009-2010 and 2010-2011 main estimates. What is the number that will actually be subject to the freeze?

I don't want savings. I just want to know the number that is going to be frozen.

[Andrew Treusch]

Mr. Lakroni.

[Alex Lakroni, Chief Financial Officer, Finance Branch, Department of Public Works and Government Services]

From our operating budgets of $3.4 billion, we have a salary budget of about $1 billion. When we apply the freeze, that leads to an amount of about $8.7 million.

[Martha Hall Findlay, Liberal, Willowdale, ON]

I'm looking at total operating expenditures here for last year of $5 billion, almost $6 billion. I'm looking at various portions that come up as operating expenditures. I'm not asking for the savings. I'm asking for what total is going to be frozen.

We hear the government advertising and bragging about departmental freezes. I'm looking at very big numbers here that have increased by almost 20%. All I'm trying to get at is the departmental number that will actually be frozen, so we can compare apples to apples when in fact we want to hold the government to account on the actual freezing.

What's the number that's going to be frozen?

[Alex Lakroni]

I will provide you with an explanation and then the number.

On $3.4 billion of operating budget, there is a salary envelope of about $1 billion—$1.080 billion. When we account—this is again an estimate, because the amount has not yet been confirmed to us officially—give or take, we're looking at a freeze of about $8.7 million. That's the amount to be frozen.

[Martha Hall Findlay, Liberal, Willowdale, ON]

So out of a total departmental budget, in terms of operating expenditures that I'm looking at, that is now almost $6 billion, the only portion that's actually going to be frozen is $8.7 million?

[Alex Lakroni]

I don't think the operating budget is $6.3 billion.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Well, I'm looking at total operating expenditures. If I'm missing something, I'm more than happy to have you explain it to me. I'm just looking for a number.

[Alex Lakroni]

Okay.

The $6.3 billion is various components. As Mr. Treusch explained, the special allotments that are for non-discretionary expenditures are excluded from the freeze. For instance, all the money for the economic action plan--

[Martha Hall Findlay, Liberal, Willowdale, ON]

I hate to be blunt, but I understand that. What I'm trying to get out of this is that if you take out the discretionary amounts, what is the number that will be frozen? We were told that this department's budget was going to be frozen, and I just want to be able to compare. What is the number? If it's only $8.7 million, that's not an awful lot in the grand scheme of the advertisement that somehow government departments are being frozen. It ends up being a very small portion of the departmental spending.

[Alex Lakroni]

I have to go back to the basics of the budget. A big chunk of our budget is for non-discretionary expenditures. The government decision is that those non-discretionary expenditures are to be excluded from the freeze. In addition to that, we have other expenditures that are revenue-dependent.

So when you make all those adjustments on a salary budget of about $1 billion, more or less, the freeze--it's an estimate, again, until it is confirmed--is $8.7 million for 2010-11.

[Martha Hall Findlay, Liberal, Willowdale, ON]

Thank you.

[The Chair, Liberal, Yasmin Ratansi]

Thank you.

[Andrew Treusch]

Can I just augment that, very briefly?

[The Chair, Liberal, Yasmin Ratansi]

Sure.

[Andrew Treusch]

By its very title, the operating budget “freeze” is meant to eliminate growth in the operating expenses of a department. Insofar as the government is looking to harvest savings from programs, that process would be strategic review. That's the process that will unfold for our department over the coming year.

[The Chair, Liberal, Yasmin Ratansi]

Thank you very much.

I thank you for being here.

I will suspend the committee for 30 seconds while we change our witnesses.

Thank you.

[The Chair, Liberal, Yasmin Ratansi]

Order.

Yes, Mr. Holder.

[Ed Holder, Conservative, London West, ON]

I'd like to express some concern on behalf of the Bloc and on behalf of the NDP and on behalf of the Conservatives.

I really appreciate that the Liberals have great quality of questions. I think that's really excellent. I think the tenor of the questions is useful. But I'm appealing to the chair for a sense of fairness. I had a series of questions, and I was slated to be the next Conservative speaker. It would have been great if all of us had had a second round.

I would appeal to you, Madam Chair, that if we do not all have a second round as per our flow-through, no one gets a second round, and we find some way to do that in the spirit of fairness. It seems to me that the Bloc would have had other questions to ask our guests. I think the NDP would have had some, and certainly we would have had some as well.

We need to find a way, Madam Chair, if I might, through you, to make it fair to all concerned. I appeal to your sense of fairness.