Government Operations Committee on Dec. 6th, 2012

[Pierre-Marc Mongeau]

Mr. Chair, if I have understood the question correctly, I would say that we still need a lot of temporary offices. We have two options.

The first is to renovate the buildings that belong to Public Works and Government Services Canada, like the La Promenade Building or the Wellington Building. We are killing two birds with one stone: we renovate the buildings that need renovating, and we use them as temporary spaces in some cases.

The other option is to find more flexibility. To do this, we will take out leases with the private sector. Ultimately, our objective is to reduce the number of leases with the private sector as much as possible in order to return to our own buildings. But we still need the flexibility that these leases in the private sector offer.

Furthermore, it's rather rare that we rent out government buildings to private organizations. We can do it for businesses, but we generally don't do business in the private rental market.

So our buildings will be used for the staff of our partners or for the staff of Public Works and Government Services.

The leases will be used because of their flexibility. Eventually, our goal is to reduce the number of leases as much as possible by using our own buildings.

[The Chair, NDP, Pat Martin]

Thank you, Mr. Mongeau.

Thank you, Ms. Duncan.

For the Conservatives, Mr. Peter Braid.

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

Thank you, Mr. Chair.

Thank you to our representatives for being here this morning, for sharing these very comprehensive plans, and for managing these critically important projects.

I have a couple of questions. First of all, I'm curious to know if you have calculated the number of jobs that will be created as a result of all of these projects.

[Pierre-Marc Mongeau]

I have some numbers. As we speak, there are more than 500 people working on the West Block, the Wellington Building, and the Sir John A. Macdonald Building. People are working on site today.

In the future, when we look at job creation, we think that about 4,000 direct and indirect jobs will have been connected to West Block renovations. These are jobs related to architects, suppliers and all the consultants and manufacturers who make the products. So for West Block, we're talking about some 4,000 jobs. For the Wellington Building, the number of new jobs is about 2,000 to 2,500.

We think that, in the medium term, when most of the contracts are under way, about 17,000 direct and indirect jobs will be created by having these construction projects.

These jobs will not be just in the National Capital Region. There will also be jobs with the various manufacturers who will provide us with services.

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

Thank you for sharing those numbers. That's very helpful.

I think it's crystal clear that these investments in these very, very important heritage buildings are critically important and need to be made. What would be the result if these investments were not made?

[Pierre-Marc Mongeau]

The main issues we're facing are included in the various reports that we have requested from third parties over the years. One of these reports concluded that West Block would come to the end of its useful life in 2013. We were able to release it in 2010 and 2011, and we saw immediately that there were serious problems. So we were able to meet an important deadline, but we realized that the state of the building was worse than we thought.

For Centre Block, we're talking about 2019. In 2019, the main systems will come to the end of their useful life. When I talk about health, safety and structural systems, I am referring to mechanical systems. For the moment, we are stretching out the life of these systems, but at some point, we won't be able to repair them anymore. According to the experts we've hired—so the engineers and architects and third parties—we're talking about 2019 in the case of Centre Block. That means that, eventually, the possibility of staying in place will be reduced.

There are problems with some electrical systems. Sometimes relays, which are types of fuses, break down. But the type of relay in East Block and Centre Block no longer exists. Our technologists have to be extremely creative to repair this type of device. As we mentioned earlier, a transformer exploded because it was at the end of its useful life.

We are managing these situations as best we can with the help of our employees. We will stretch out the useful life of these systems as long as possible, but at some point, we will need to take action. In the case of the East Block tower, for example, we had to put forward a renovation project so it could stay in place and so the health and safety dangers would be reduced. If some stones fall, if electrical wires are too exposed or the roof becomes less solid because of a defective structure that dates back to 1850 or 1860, it's clear that we need to take action quickly. We are correcting the problems before they become a danger. We are not waiting. This is the approach that we put into practice every day.

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

I have one very quick final question. Will the new chamber have wireless access?

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

Will it have a Starbucks?

[A voice]

Will it have both?

[Pierre-Marc Mongeau]

I don't know if there will be a Tim Hortons or a Starbucks. I cannot answer that. I can tell you that all the IT responsibility is under the House of Commons, so they will have to give us the requirements and we'll be happy to install these systems, as we're doing right now. We're doing what they are asking us to do in order to be sure it will be state of the art in this room.

[The Chair, NDP, Pat Martin]

Thank you very much, Peter and Mr. Mongeau.

Next for the Liberals, Mr. John McCallum. Five minutes, please, John.

[John McCallum, Liberal, Markham—Unionville, ON]

Thank you very much. I'm sorry I missed your presentation, but I have a couple of questions.

In terms of timelines, going back some years I seem to remember all of this was supposed to be done quite a lot sooner.

Can you tell us what has happened to the timelines over the past years? How much later is it than when it was originally supposed to have happened?

[Pierre-Marc Mongeau]

Thank you for the question.

As I said earlier, the first project was established or looked at in 1997.

Since then, the scope of the projects changed following amendments and requirements from parliamentarians and senators. We have also had to deal with a lot of changes in code and in an increased deterioration of West Block, especially the interior.

In 2007, we established the new baseline for the next five years. We are completely up to date in that respect. As you can see, in 2007, we had said that we would start work on West Block, the Sir John A. Macdonald Building and the Wellington Building. That's what we are currently doing. We awarded the contracts and started carrying out these projects.

There is currently an acceleration of the different projects under way, and we intend to continue at that pace. That's why we have five-year plans. We can better control costs and better report to the government on what we did over those five years. It enables us to submit a request for another five-year period. It allows us and the government to exercise control that ensures we have a more realistic vision of things. A 25-year plan is more difficult to carry out, whereas a five-year plan is clear.

[John McCallum, Liberal, Markham—Unionville, ON]

I don't understand what happened. If the original plan was started in the 1990s and then delayed until 2007, why was there that huge delay?

[Pierre-Marc Mongeau]

As we said, we had an initial idea for West Block in 1997, but it was really very preliminary.

Around 2000, the project was stopped because of the millennium festivities. So that slowed the work down.

Then, there were a lot of discussions between the various partners to find out what direction should be taken. A lot of discussions took place between 2000 and 2005, and agreements were not necessarily a priority.

In 2005-2006, we drafted a report with our partners, and the report made a long-term vision possible; that started in 2007.

There were a lot of negotiations before decisions were made. Those decisions were transformed into contracts. As I said earlier, walk along Wellington Street and you will see that things are moving forward.

[John McCallum, Liberal, Markham—Unionville, ON]

I have one last question, if I may. Perhaps you referred to this earlier, but on page 7 of your deck, when you talk about key relocation projects, you refer to savings. Why are they savings rather than expenditures?

[A voice]

Why is it what, sir?

[John McCallum, Liberal, Markham—Unionville, ON]

There are savings adding up to $34.1 million. I don't quite understand why these are called savings as opposed to costs.

[Pierre-Marc Mongeau]

Since 2005-2006, we have put forward a number of projects, and 15 of them have been approved and listed here. We provided the difference between the initial budgets and the final costs.

Take for example the C.D. Howe Building at 240 Sparks Street, which was a relocation because we emptied the La Promenade Building. At the time, we had established the initial cost at $8.1 million for work on the C.D. Howe Building. That amount included all our construction, fees, and so on. The final cost was $4.3 million. So there was a savings of almost $3 million that we can use for other things.

We have a number of projects like that. For example, the initial budget for the La Promenade Building was $83 million to $84 million, which included the contingencies and the rest. Our final costs were about $77 million. So we saved $6.4 million for those projects.

When we add up the 15 major projects that we have prepared, we see that we have managed to save $34 million because of tight project management.

[The Chair, NDP, Pat Martin]

Thank you, John.

[John McCallum, Liberal, Markham—Unionville, ON]

Thank you.

[The Chair, NDP, Pat Martin]

You're well over your five minutes.

For the Conservatives, we have Bernard Trottier.

[Bernard Trottier, Conservative, Etobicoke—Lakeshore, ON]

Thank you, Mr. Chair.

I thank our guests for being here this morning.

Mr. Mongeau, concerning Centre Block, you spoke about a critical risk of complete failure in 2019. What does that mean? When will MPs and senators have to evacuate the building so that the building can get the renovations it deserves?

[Pierre-Marc Mongeau]

Thank you for the question.

Basically, as I've already mentioned, we are talking about 2019 in the study. Right now, our objective is to determine which options would enable us to proceed as quickly as possible with Centre Block. The report talks about the total failure of Centre Block. The mechanical and electrical systems have come to the end of their useful life. In 1994-1995, we repaired a significant part of the building's facade because the stone was in poor condition. But there are still other components that need to be rehabilitated.

If you look at the building, you can see that the ventilation shafts are connected with pieces of wood. We are in the process of drawing up plans and estimates with consultants to correct that. The current House of Commons has large windows, but they are becoming unstable. One piece has already fallen out, and we had to install a safety net in front of those windows. It is certainly less interesting, visually. But for health and safety, it's a protective measure.

A good number of these systems are coming to the end of their life, but we are maintaining them. At one point, the money invested will be money wasted because the systems—the mechanical systems, especially—will be at the end of their useful life. We will not be able to install a series of small systems in each room. We will have to rethink the whole. Starting in 2019, we will really have to work on that.

[Bernard Trottier, Conservative, Etobicoke—Lakeshore, ON]

Will the House of Commons and the Senate be relocated in 2019 or before that?