Government Operations Committee on May 27th, 2014

[Bill Matthews]

Yes, and basically the government has environmental liabilities related to things that the government actually didn't cause, and we're often left holding the bag. We have identified 16,300 sites as possible liabilities. You've mentioned two of them. I believe that every effort was made to go after the corporations, but in the end, the government owns that land and is responsible for the cleanup. As for how we got there, I really don't have the knowledge to speak to that.

[Pat Martin, NDP, Winnipeg Centre, MB]

No, and it isn't fair to put you on the spot either, Bill. You're sent in here to explain and to defend a lot of this spending.

Moving on to the nuclear stuff, I remember the debate around whether SNC-Lavalin would take over AECL, and I don't remember it just being the profitable part of the company. I thought the whole deal.... As for the reason they didn't buy it, we actually paid them to take it over. We gave them a positive amount of money to take over AECL, and the public assumed—at least I did—that included the liability. You don't privatize the profits and socialize the losses. That's not in the best interests of Canadians.

How did we end up with this incredible nuclear waste liability when I think the public assumed that we were farming that out?

[Bill Matthews]

The division that was bought or sold to SNC-Lavalin was indeed the nuclear reactor division, the CANDU reactor.

[Pat Martin, NDP, Winnipeg Centre, MB]

Chalk River is the nuclear reactor—

[Bill Matthews]

It is, but the government retained those facilities and the related liability. There were some liabilities that went with SNC-Lavalin. They were related to liabilities attached to current projects that were ongoing and either were behind schedule or had some challenges. SNC-Lavalin took on those projects, but the actual environmental liabilities themselves have remained with the government, as do the facilities at Chalk River.

[Pat Martin, NDP, Winnipeg Centre, MB]

Okay.

Well, the third one out of 16,000 or whatever contaminated sites is Lac-Mégantic, the most recent one. What kind of cost-recovery efforts is the government making now? We're putting in $95 million up front to make these people whole and try to put their community back together, and I don't disapprove for a minute. But are we going to be able to go after and recover that outlay of money?

[Bill Matthews]

In this case, the outlay from the government went to the Government of Quebec. It was the federal share. I believe it's the Province of Quebec that is going after the company itself, but I'm not positive of that. This liability is not a federal government contaminated site liability. The government is making a contribution to help the municipality and then the province clean up the area. This is a bit different. It's not a Government of Canada liability per se.

[Pat Martin, NDP, Winnipeg Centre, MB]

On the $44 million that you say is loaned to first nations so they can take legal action regarding land claims, in your experience, is that then deducted from the amount of the land claim? Or if the first nation is successful, do they get awarded the land claim plus their legal costs?

[Bill Matthews]

It is funded as a loan to allow them to participate in negotiations. I believe there is a vehicle such that under certain circumstances the loan can be forgiven, but that's kind of down the road. The normal course of action is that it's a repayable loan, regardless of the outcome.

[Pat Martin, NDP, Winnipeg Centre, MB]

Regardless of the outcome? That's interesting.

[The Chair, NDP, Pierre-Luc Dusseault]

Mr. Martin, your time is up.

I will now give the floor to Ms. Ablonczy for five minutes.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Thank you again, Mr. Matthews. You're lucid as always, and that's always a good thing.

I've plugged the change you made—to Infobase instead of “expenditure database”—and I'm wondering whether there's any further modernization of nomenclature in the works. As you know, I have a bee in my bonnet about supplementary estimates, which is really newly approved spending. Are you going to clarify any of those things? Or is there anything we can do to move that along?

[Bill Matthews]

Thank you for the question.

We are not at this stage contemplating name changes to the estimates documents, but that being said, if there are suggestions from the committee—and we have taken on board many of the suggestions from this committee in the past on how to improve—please feel free to make recommendations. We'll certainly take them under advisement.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Well, I think the parliamentary secretary is going to have some lobbying from one of his members along that line.

I too am worried about AECL. That's been a black hole of hundreds of millions of dollars. I would have thought that after all these years this would have at least achieved some kind of balance and stability. From your examination, is there more spending coming down the pike on this outfit? At some point, are they going to be at least self-sufficient?

[Bill Matthews]

The AECL annual operating budget that you would see in the main estimates is not sufficient to fund their annual cost, which is why we often see them in supplementary estimates. They are in the process of setting up what's called a GOCO, which is a government-owned corporation operated organization, to effectively move the AECL employees into the private sector. Eventually, we will see a private sector organization operating AECL. The government will still own it.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Eventually, as in…?

[Bill Matthews]

They're setting it up. There are procurement plans. It will have to go out to tender. The actual payments to that organization, the eventual winner, will be based on performance. Basically, the procurement process is ongoing. The request for proposal is out. Bids are due back in early August. You'll see bids in from private sector organizations wanting to run this thing. When all is said and done, if all goes as planned, you'll see about 50 to 70 workers left in AECL who will do things like oversight and governance, but the actual book of the employees will be transferred over to this private sector organization that will operate AECL as opposed to having the government operate it.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Shall we say it is a step in the right direction, or we certainly hope so.

With respect to the jobs grant, there seems to have been some delay in getting that money, the agreement for all the parties, on that money. I'm interested in when this money will be spent. Is it being transferred directly to young workers, or is it going to the provinces?

[Bill Matthews]

There's matching for the bulk of it. It goes from the federal government, I believe, and comes from the employer as well, and the provinces play a role in this as well. I think it goes…and I don't want to speculate.

Do you actually know how this goes?

[Marcia Santiago]

The intention is for the funds to go through the provinces, provided that the agreements are signed. If the agreements aren't concluded, there is another set of options available to the organization to deliver the grant.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Okay.

There seems to have been a little lack of, shall we say, cooperation in that, but if it goes through the provinces, then I'm assuming that the agreements will be signed soon.

[Marcia Santiago]

At the beginning of May, I believe four agreements had already been concluded. There are key milestones for the other remaining negotiations that occur in May and June.

[Bill Matthews]

I think we do have agreements in principle, or MOUs, with all provinces and territories, so we're on the right track.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Okay, thank you.

[The Chair, NDP, Pierre-Luc Dusseault]

Thank you, Ms. Ablonczy.

The members of the committee seemed interested in discussing an out of court settlement under people management, but it was not possible to discuss it earlier. If the committee so wishes, I suggest that we continue the meeting in camera to spend a few minutes on this issue. That is what the members of the committee seemed to want.