Government Operations Committee on Nov. 18th, 2010

[The Chair, Liberal, John McKay]

Ladies and gentlemen, we'll bring this committee to order, please. This is the 37th meeting of the Standing Committee on Government Operations and Estimates.

We have five groups who wish to make presentations to the committee, and I am sure that our clerk, our very able clerk, has advised you on presentation time. You have up to ten minutes in which to make a presentation.

I'll simply go on the orders of the day, starting with Infrastructure Canada, please.

[Bryce Conrad, Assistant Deputy Minister, Program Operations Branch, Infrastructure Canada]

Thank you, Mr. Chair.

Thank you, committee members. I promise not to take the full ten minutes.

We're pleased to be here today to speak to the Government of Canada's G-8 legacy fund. Joining me today from Infrastructure Canada is my colleague Mr. Taki Sarantakis, the assistant deputy minister of policy and communications.

As the committee is well aware, Canada hosted the G-8 summit on June 25 and 26 of this year in the Muskoka region. This was Canada's fifth time hosting a summit since joining the G-8 in 1976. In budget 2009 the Government of Canada provided $50 million as a legacy fund to the Parry Sound--Muskoka region, which was the host of this year's summit. The funding was very much designed to assist the region to prepare for the hosting of the international summit as well as in part to compensate the region for the inconveniences of hosting an international event of this magnitude.

As the committee members present can surely appreciate, having a large group of world leaders and their respective delegations presents a number of significant challenges to the local population. These include dealing with the increased security, the media, and the sheer disruption of everyday life associated with this type of world-class event. The funding was intended to support projects that would enhance the visual and tourism image of the region and contribute to the successful hosting of the G-8 conference. This was not nor should it be seen as a traditional infrastructure program. It was very much a legacy to the region from the Government of Canada.

In total, we approved funding for 32 projects throughout the region, including for the G8 Centre in Huntsville and the North Bay Airport.

Sixteen different municipalities received much-needed infrastructure moneys to help improve their local roads and tourist attractions and beautify the downtown streetscaping to ensure that they were ready to host the world in June of this year. These municipalities worked night and day and mobilized contractors to ensure these projects were completed within the very tight timelines provided by the fund. These projects will help to leave a legacy for the region for both tourists and residents alike. They are to be commended for their efforts and the outcomes.

Mr. Chairman, the funding granted to the region for hosting the G8 Summit is consistent with the government longstanding tradition for this type of international event, mainly: the APEC Summit in 1997 in Vancouver, for which the Canadian government invested $60 million to widen route 1 and to make improvements to the Vancouver International Airport bridge, as well as to establish the new forestry centre at the University of British Colombia; the G8 Summit in 2002, in Kananaskis, Alberta, for which the government of Canada invested $5 million under an environmental heritage fund and built a passage for wild animals in Canmore along with the creation of a University of Calgary chair in fauna.

Furthermore, in Halifax in 1995 the Government of Canada provided $300,000 for the retrofit and rehabilitation of the Bluenose schooner; $8.1 million for local infrastructure investments to Halifax and Dartmouth areas, including local roads, beautification of the downtown areas, and streetscapings; as well as a $3.1 million contribution to retrofit Pier 21, which was provided to the community as a gift after the summit was completed.

That ends my opening remarks. My colleague and I would be more than prepared to answer questions.

[The Chair, Liberal, John McKay]

Thank you very much.

The Department of Industry.

[France Pégeot, Assistant Deputy Minister, Regional Operations, Department of Industry]

Mr. Chairman, ladies and gentlemen members of the committee, good day.

My name is France Pégeot. I'm the assistant deputy minister in Industry Canada responsible for the federal economic development initiative in northern Ontario, better known as FedNor.

I'm here to speak with you about the support provided by FedNor in the context of last summer's G-8 summit.

Before we deal with the issue of support, I would like to give you some context on FedNor, an Industry Canada initiative or program.

Since 1987, the government of Canada, through FedNor, has done effective work in collaborating with northern Ontario organizations and communities so as to promote and enhance northern Ontario economic development.

Through the northern Ontario development program, FedNor's principal funding program, and often referred to as the NODP, FedNor supports and promotes projects that benefit the economy of northern Ontario, namely by funding community economic development projects and by working with small and medium-sized enterprises to support their growth.

FedNor contributes to creating meaningful, long-lasting employment and more generally to strengthening economic development in the region. Since 2006 FedNor has approved over $156 million in support of close to 900 projects through the NODP to benefit northern Ontario's economy.

Tourism in its many forms is an avenue for economic diversification and a vital revenue stream for northern Ontario, and as a result is one of FedNor's priority areas for funding under the NODP.

To give you some background, I should point out that the tourism industry in northern Ontario has experienced and continues to experience some difficulties, most notably due to the economic downturn.

In 2006 to 2008, the total number of visitors to northern Ontario dropped by 15% and tourism-related expenses fell 12%.

The G-8 summit represented an opportunity to promote awareness about northern Ontario and what it has to offer. It was also an opportunity to leverage international media attention, and in turn increase tourism and investment activity in and for the region.

FedNor's main investments related to the G-8 were for four community economic development and tourism projects, worth approximately $2.6 million, which were funded under the NODP. These projects were deemed to contribute to economic growth and diversification, and that would result in short-term and long-lasting economic benefits to northern Ontario. All projects were funded from existing budgets and met the terms and conditions of the NODP.

I would be pleased to answer your questions.

[The Chair, Liberal, John McKay]

Thank you, madam.

Next we have the Department of Public Works and Government Services.

[Renée Jolicoeur, Assistant Deputy Minister, Accounting, Banking and Compensation Branch, Department of Public Works and Government Services]

Mr. Chairman, honourable members of the committee, good day.

My name is Renée Jolicoeur and I'm the assistant deputy minister of accounting, banking, and compensation of Public Works and Government Services Canada.

I personally became engaged with the G-8 and G-20 summits in November 2009 as the lead ADM for my department.

I have with me today Sandra Young, the acting regional director general for the PWGSC, Ontario region.

Public Works and Government Services Canada is the common service provider for multiple service lines for the Government of Canada and its agencies. We provide vital services such as accommodation, purchasing, information technology, and translation. PWGSC played a supportive role in the G-8 and G-20 summits through the provision of a series of services, mainly to DFAIT and RCMP, who were responsible for identifying and funding their requirements.

In fulfilling its responsibilities for the summit, PWGSC spent $32.1 million over the fiscal years 2009-10 and 2010-11. In terms of volume, we put in place 55 leases for a total value of $18.7 million, funded partially by PWGSC and partially by other departments. In addition, we put in place 150 contracts for goods and services totalling $94.2 million using a variety of contracting means, including the Government of Canada's public-tendering service, MERX.

Public Works and Government Services Canada unceasingly aims to acquire goods and services in such a way as to improve access, ensure competition, provide fair treatment for industry and foster value for money.

The department has committed to implementing a very competitive process, that is both open and fair, while respecting its obligations under national and international trade agreements as well as under government of Canada contracting regulations.

This is demonstrated by the fact that 93% of the total value of the goods and services contracts was competitively let.

In cases where a sole-source approach was taken on a specific requirement, we ensured there was a solid and fully documented rationale in place that complied with the Government of Canada contracting regulations. The reasons for the sole-source included national security, pressing emergency in which delay would be injurious to the public interest, the low dollar value of the contract, or only one person was capable of performing the service.

Wherever possible, options to reuse existing resources were sought. The table from the 2002 G-8 summit in Kananaskis was reused. Tables from the 2008 Quebec City francophonie summit were also used. We worked closely with our clients to maximize economies-of-scale opportunities.

When we learned of the possibility that a G20 Summit could be held at the same time as that of a G8, we sought to ensure that our G8-related contract could be used for the G20 as well.

I would also like to point out that we have made every effort to encourage small and medium-size companies to take part in the supply process for the summits. At the request of the Summit Management Office and local chambers of commerce, PWGSC's Office for SMEs provided information and seminars to entrepreneurs in the community on fundamental concepts of the sale of products and services to the Government of Canada.

As a service provider we can provide information on contracting processes and value of the contract. However, questions on what was required and why they were required must go to my colleagues in the respective client departments. It's also important to note that each department had specific contracting authorities that they exercised on their own.

As soon as we were engaged in the summit initiative, PWGSC began to formulate a robust governance structure and funding framework to coordinate and oversee our delivery on the G-8 and G-20. While we had previous experience in supporting summit events, this was the first time we were hosting two international events back to back, as well as a youth summit, a summit of global business leaders, and 29 preparatory events in the first half of 2010 in different regions across Canada.

Mr. Chair, PWGSC employees worked very hard, with the utmost dedication and integrity, and are proud to have been able to support our client colleagues and deliver on these goals.

I would now be pleased to answer your questions.

[The Chair, Liberal, John McKay]

Thank you, Ms. Jolicoeur.

Mr. Chowdhury, you have the floor.

[Sanjeev Chowdhury, Director General, Programs, Summits Management Office, Department of Foreign Affairs and International Trade]

I don't have an opening statement, Mr. Chair. I'm here just to take questions.

[The Chair, Liberal, John McKay]

We always like short statements, Mr. Chowdhury.

Next is the Department of Public Safety and Emergency Preparedness.

[Mark Potter, Director General, Policing Policy Directorate, Department of Public Safety and Emergency Preparedness]

Good morning. I'll be brief.

I'm Mark Potter, director general responsible for policing policy at Public Safety Canada. I'm joined by my colleague, Hélène Filion, comptroller at the department.

Overall, for the G-8 and G-20 summits, Public Safety Canada played three roles: first, coordinating emergency management activities; second, coordinating public communications activities with partners on issues related to security and public safety; and third, managing the application of the security cost framework policy. The department's main responsibility was the third role of managing the application of the policy.

In order to understand Public Safety's role in managing the security cost framework policy, it is important to understand both the policy itself as well as the broader context of providing security for the summits.

The RCMP is the lead agency responsible for policing and security for Prime Minister and minister-led international meetings held in Canada. For such events, the RCMP and CSIS conduct threat assessments and determine if there is a requirement for extraordinary security measures. If it is determined that extraordinary security measures are required, and the involvement of provincial and municipal security partners is necessary to provide the appropriate level of security, the Minister of Public Safety may recommend to the Prime Minister, along with the host minister, that the event be designated under the policy.

The summits were designated by the Prime Minister and this permitted the reimbursement, through contribution agreements, of eligible expenses incurred by provincial and municipal security partners.

Given the comprehensive security requirements of these events, jurisdictional responsibilities for policing, and the limited resources of the RCMP, the cooperative participation of provincial and municipal security partners is vital.

For the G-8 and G-20 summits the eligible partners were the Ontario Provincial Police, Toronto Police Service, Peel Regional Police, North Bay Police Service, Town of Huntsville, District of Muskoka, and Township of Lake of Bays.

Under the authority of the policy, Public Safety Canada officials took several steps to review partners' cost estimates. First, the terms and conditions of the policy were conveyed to the partners as the framework within which they could develop their cost estimates. Once estimates were received, they were reviewed and challenged to ensure that security partners pursued a reasonable cost approach.

Throughout this process of reviewing estimates, discussions were also undertaken with the RCMP to ensure that such estimates were consistent with the overall security plan. These activities took place over several months leading up to the summits.

Based on the estimates developed by provincial and municipal security partners, funding requirements totalling $278 million for the application of the policy were approved through the supplementary estimates process. Of this amount, $276 million was to fund the contribution agreements with partners, while the remaining $2 million was to administer the policy, primarily the conducting of audits. The majority of the partners' estimated costs were for police officers' salaries, accommodation, food, and equipment.

Although some interim payments have been made, final claims for actual costs incurred have not yet been received. As per the terms and conditions established in the contribution agreements, all claims are to be received no later than December 1, 2010.

To ensure compliance with the policy, independent audits will be performed on all claims before payments are issued. Once the audits are completed, Public Safety Canada will be in a position to confirm the total amounts reimbursed. The goal is to complete this process by March 31, 2011.

We appreciate the opportunity to appear before you today. My colleague and I would be pleased to answer any questions the committee may have.

Thank you very much.

[The Chair, Liberal, John McKay]

Thank you, Mr. Potter.

I'm sure you've all been briefed on members' questions. The first round is eight minutes to each party, and thereafter five minutes to each party.

Madam Coady, eight minutes, please.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

Thank you very much.

I certainly appreciate all of you being here today and the work and efforts that you make on behalf of the Canadian people. I start by saying thank you for that.

Today's questions are going to be short and to the point, because I only have eight minutes.

We did bring along a map to help this morning in indicating what I'm talking about, so can we put that up on the screens, please? It's just a map of the area so that we can get a view of what I'm going to talk about.

This is for Infrastructure Canada, first. Under the G-8 legacy fund, you spent about $1 million upgrading sidewalks in Parry Sound. On the map, Parry Sound is number A. It's about 81 kilometres away from the existing site of the G-8 summit. You spent about $1 million in that area. I'm just wondering why it was needed to be upgraded for the G-8 summit.

[Bryce Conrad]

Thank you for the question.

Unfortunately, I can't actually see the maps very well, but I'll take your word for it.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

I have a print copy. We'll give the print copies to the clerk.

Yes, it's always hard to see, isn't it? But it's about 81 kilometres. We'll hand you a map.

[Bryce Conrad]

It's showing my age, unfortunately.

[Chris Warkentin, Conservative, Peace River, AB]

We can't see it from here either.

[Bryce Conrad]

As I indicated in my opening remarks, Madam Coady, this fund was very much set up as a legacy fund to compensate the region for the inconveniences associated with hosting this event. As I indicated earlier, it's not unlike—

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

Eighty-one kilometres for hosting the event? That's a long ways away.

[Bryce Conrad]

I appreciate that.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

An hour at least from the site of the hosting of the event.

[Bryce Conrad]

Again, these were legacy investments made to improve the region, to improve the tourist appeal of the region, to improve the visual image of the region, as well as to facilitate the hosting. It was not all intended to support the hosting of the summit.

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

Okay. So it's not all intended to support the hosting. So what were the decision points around making those decisions?

We have Sundridge. If you look on your map, which is B on your map, it's 61.2 kilometres away, and it was $750,000. These are big, expensive projects, and they're all in one minister's riding.

I don't know if anyone from the G-8 actually went to see those, that sidewalk or the renovation in Sundridge, which is 61 kilometres away from Deerhurst. What did the bandstand have to do with the G-8?

[Geoff Regan, Liberal, Halifax West, NS]

What free time did they have for that, I wonder.

[Bryce Conrad]

I still don't have a map, but I'll answer the question.

Again, these investments were not specifically made to support the....

[Siobhan Coady, Liberal, St. John's South—Mount Pearl, NL]

But you said they were part of the G-8 and you said that for the inconveniences of hosting the G-8—