Government Operations Committee on Nov. 22nd, 2011

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you very much. I was going to ask for an example and you gave me two, so thank you.

The next question I have was sparked by a question that my colleague asked. Under the transfers, I note that there's a transfer to the national investment strategy. I wonder if you would be willing to talk about the national investment strategy.

[John McBain]

Certainly. PWGSC operates one of the largest real estate holdings in the country. We own or manage in total 7 million square metres of office space. Included in that are 340 buildings, as well as a collection of dams and bridges that are historically part of the department.

As a prudent custodian of that kind of an inventory with a replacement cost in excess of $4 billion, we have a standing investment annually to protect the investment of taxpayers in these buildings, to perform cyclical large maintenance and recapitalization.

For the line you see under “Transfers”, for $14.9 million, is moving it from vote 1, which is operating, to vote 5, which is capital. That's basically allowing us to move funds from what would normally be space provided in leased accommodation, which must be funded from vote 1, to space that we are now providing in crown-owned accommodation. When we do work in crown-owned accommodation, it must be spent from the capital budget. This is us moving money from one vote to another to make it consistent with where we're going to spend it.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Okay.

As a follow-up, you talked about dams and bridges. I'm assuming the reason why we own them is because of that responsibility to protect the taxpayers' money. Is that correct?

[John McBain]

Our mandate in office accommodation is very clear. It is set out in the DPWGS act. Paragraph 6(f) states that the minister shall provide office accommodation. That is a mandated function.

In the realm of what we call engineering assets, many of them come historically to the department. The Department of Public Works was created in 1847, so it has a long history in the development of this country, and many of the assets have historically rested with us. At this point it's not quite our mandate, but we have an historical purpose and that's why we have 20 of these assets still in our inventory.

[Kelly Block, Conservative, Saskatoon—Rosetown—Biggar, SK]

Thank you.

[The Chair, NDP, Pat Martin]

You have nearly one minute left, if any of your colleagues have a question.

Mike always has a question.

[Mike Wallace, Conservative, Burlington, ON]

Sure: I have a general question for you, and I don't know if you can answer it in a minute.

I have a chart I've made up of everybody's supplements and so on over the last number of years. For Public Works, I'll give you examples: three years ago it was 12%, two years ago it was 28%, and last year it was 17%. This is the difference between what you've asked for in the main estimates and what you've asked for in supplementaries (A), (B), and (C).

I find those to be significant differences. My understanding is that the supplementaries are there so that when the budget comes out, whatever changes there need to be are allocated through supplementaries. Can you explain to me how the Department of Public Works is affected by the budget? I don't see why those numbers from your department are so high compared to those of many other departments.

[Alex Lakroni]

Thank you for the question.

I don't have those numbers in front of me, but we take them at face value. I go back to the nature of the business of PWGSC. We're a common service organization. As I mentioned in my opening remarks, we have a complex funding structure and 57% of our appropriation is revenue dependent.

We exist to deliver services to other government departments, so our budget is very much linked to the spending of the government. Often, TB submissions--approvals, programs--get approved, and then we provide accommodation to those programs. At the tail end of the process, it's hard to plan for that growth ahead of time. When those programs materialize, we adjust our budget to respond accordingly.

Our business fluctuates depending on a variety of things: the demands of procurement of the government, or the accommodation of public servants, or the volume of translation--

[Mike Wallace, Conservative, Burlington, ON]

Yes, but on the other side of the coin, when I look at the public accounts books, you spend a lot less than what you ask for compared to other departments. I'm kind of confused. Why are we allocating so much to you if you're not going to actually spend it and why are you asking for so much in the supplementary estimates? It's something to think about.

[The Chair, NDP, Pat Martin]

You're well over your time. Thank you. Maybe you can get to that in your next round.

We'll go back to the NDP, with Mathieu Ravignat.

[Mathieu Ravignat, NDP, Pontiac, QC]

I have a few questions about the parliamentary precinct.

You are asking for an amount of $64 million for the next two or three months. What was the additional amount requested last year? Could you also give us more details on the renovation process? Where are you at?

Perhaps you can start by answering those two questions; I will ask more questions afterwards.

[Alex Lakroni]

I will try to answer the first question.

Unfortunately, I don’t have the numbers with me for last year’s supplementary amount. So I cannot give you the exact figure. I can follow up on it and give you the amount later, since I don’t want to mislead you.

[Mathieu Ravignat, NDP, Pontiac, QC]

Okay.

[Pierre-Marc Mongeau]

With respect to the request for this year, part of the $64 million that you see on the list, about $20 million, will be used for rents, for leases. These are things that have to be paid on an annual basis. We make the request, we obtain the amount and we pay.

This year, another $28.9 million will be set aside for various projects that have already started. There is recapitalization. For example, we will draft plans and estimates for part of the roof of the Confederation building. We have a multitude of projects like that, that do not necessarily involve millions of dollars but that are part of what we call the long-term vision, which was discussed with the Senate and the House of Commons.

Where are we at? I might take up all your time, but I'll tell you a bit about the main achievements. From 2007 to 2012, our main objective was to find space so we could free up the East Block and the West Block. Later, once they have been renovated, we will also be able to free up the Centre Block. The Senate will then be relocated to the East Block, and the House of Commons will be relocated to the West Block. To create this domino effect, we needed to set people up in various buildings between 2007 and 2010. For example, La Promenade, which some of you here are familiar with, was renovated to make these relocations possible.

Today, the good news is that we have finally freed up the West Block. You know that this building is currently being renovated. You are probably also familiar with the building at 180 Wellington, on the south side of the street. Renovations on that building have also started. Early next year, we will start renovating the former Bank of Montreal building. We are in the process of looking at plans and estimates to transform that building.

While we are doing that, we are also planning the next steps for the East Block. You may have seen that we are in the process of making the new northwest tower—

[Mathieu Ravignat, NDP, Pontiac, QC]

I have to cut you off, but thank you very much. It's very interesting. I can see that a lot of progress has been made.

What improvements have been made with respect to greening or environmental sustainability with this additional $64 million?

[Pierre-Marc Mongeau]

I would say that it is now custom for us to think about sustainable development. So, if you ask me what part of the budget specifically, I would have difficulty giving you an answer.

But we have already integrated new methods into our processes to reduce energy costs and improve system performance. We are also doing a lot of recycling; most of the materials are recycled. We have already integrated specific ideas about sustainable development into our estimates.

[Mathieu Ravignat, NDP, Pontiac, QC]

Okay. Thank you.

I have another question for Mr. McBain.

When I spoke about the second credit appearing on page 155, you said that it involved programs. Which programs? What are the expenditures? Could you please share this information with the committee?

[John McBain]

Certainly: without question, we can provide the committee with the list of the departments and the amounts of funds that are allocated for new programs and for renewal of existing programs.

[Mathieu Ravignat, NDP, Pontiac, QC]

Thank you.

[The Chair, NDP, Pat Martin]

Now, for the Conservatives, Peter Braid.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Thank you, Mr. Chair.

Thank you to our officials from PWGSC for being here this afternoon.

In your opening remarks, you mentioned that 57% of your budget is raised from revenue. I'm curious to know with respect to that 57% whether that has been fairly constant in the PWGSC budget. Has that increased over time? Has it decreased? Can you give us a little context on that 57%?

[Alex Lakroni]

It varies from year to year depending on where the growth is happening. Some programs are more revenue dependent than others. I don't want to sound technical, but as you know, we provide optional services. These are 100% revenue dependent. For instance, translation services, real property, and specialized services are on an optional basis, so if there is growth in those programs, the revenues grow accordingly. Other programs are partially revenue dependent, but over the last four or five years, I would say, it has remained fairly steady at around 55%.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

Okay, and what are the top three revenue sources for the department that drive that 57%?

[Alex Lakroni]

Real property, for sure.

[Peter Braid, Conservative, Kitchener—Waterloo, ON]

So that's PWGSC being the landlord?