Government Operations Committee on March 24th, 2015

[The Chair, NDP, Pat Martin]

Good morning, ladies and gentlemen. We will convene our meeting.

Welcome to the 43rd meeting of the House of Commons Standing Committee on Government Operations and Estimates.

We have convened today to continue our ongoing scrutiny of the renovations and associated costs of the parliamentary precinct renovation project, a subject that we have been monitoring for a number of years now. We all look forward to an update. Committee members will be going on a tour of the West Block renovation later today, which I think we'll all be very interested in as well.

It doesn't leave us much time for a presentation, and perhaps one round of questioning from committee members, so we'll begin without delay and introduce our witnesses today.

From the Department of Public Works and Government Services, we have Nancy Chahwan, assistant deputy minister for the parliamentary precinct branch.

Welcome, Assistant Deputy Minister. I wonder if you could introduce anyone else who will be making a presentation. The floor is yours.

[Nancy Chahwan, Assistant Deputy Minister, Parliamentary Precinct Branch, Department of Public Works and Government Services]

Thank you very much, Mr. Chair.

Good morning, honourable members.

Thank you for inviting us.

I am here this morning with Mr. Ezio DiMillo, the director general responsible for the major crown projects in the parliamentary precinct.

I appreciate this opportunity to update you on the program to preserve and rehabilitate Canada's historic Parliament Buildings.

I last appeared before this committee in November 2013 to speak specifically about the long-term vision and plan for the parliamentary precinct, also known as the LTVP. Since then, significant progress has been made. I am pleased to report that all major projects continue to be on time and on budget.

I will go into further detail in a moment, but I see that there are new members at the table. Congratulations to all.

Allow me to first provide some background to the LTVP. The LTVP is an overall strategy designed to address four main elements, namely, the deterioration of the buildings, health and safety risks, the shortage of functional space, and evolving security needs.

The LTVP was initially approved in 2001 and then revised in 2007. It is based on five-year programs of work. This approach permits flexibility in planning and implementation, and allows the government to respond to changing priorities. It also permits greater precision in determining costs and schedules.

The LTVP is focused on rehabilitating the three main Parliament Buildings, the West, Centre, and East Blocks, with the objective of getting to Centre Block before building systems are projected to be in critical risk of failure in 2019. The LTVP requires managing a number of interdependent and concurrent projects, as illustrated in the work sequencing map.

Each five year program of work focuses on preparing for the next. The first is focused on relocating parliamentary functions and parliamentary administration, and establishing interim accommodations for members and functions from West Block. The second is focused on rehabilitating the West Block and establishing interim accommodations for members of the Senate. The third will focus mainly on Centre Block.

Between the cranes, tarps, and scaffolding, it may be difficult to see the progress being made. Over and above the work you see today 19 major projects have been completed since 2004, paving the way for the major rehabilitation of the Parliament Buildings currently under way. In the delivery of these projects we have managed to contain costs and save close to $40 million.

Here are some examples. The food production facility was completed in 2009, six months ahead of schedule and $6.3 million under budget. The Valour Building, on Sparks Street just east of O'Connor, was completed in 2010 on time and $6.4 million under budget. And in 2013, we completed enhancements to the perimeter security, including the retractable bollards that now stand at every entry point to Parliament Hill.

Let me turn now to some of the major projects under way in the order of their expected date of completion.

First would be the transformation of the former Bank of Montreal into the Sir John A. Macdonald Building. This will put to good use a heritage crown asset. The newly constructed annex to the heritage building more than doubles the amount of usable space. The building will house the Confederation Room, which is being permanently relocated from the West Block for ceremonial duties as well as smaller meeting spaces. This facility will be substantially complete in just a couple of weeks.

A short distance down the block, the Wellington Building is about three-quarters finished, and is on track to be completed in 2016. Once rehabilitated, the heritage building will provide accommodation for 70 parliamentary offices and 10 committee rooms. I do invite you to have a look at the pictures if you can.

Work on the West Block, a building that was on the critical list when work began in 2011, has passed the halfway mark to completion, expected in 2017. The result will be a modern facility, fit for Parliament in a modern age. This heritage building is being restored both inside and out.

The interim House of Commons chamber will be constructed in an infill, in what was previously an unused courtyard. The infill will increase the building's functional space by nearly 50% as of 2017. After the House of Commons chamber returns to a rehabilitated Centre Block, we expect that the interim chamber will be converted to committee space.

In conjunction with this work, a new visitor welcome centre is also being constructed between the West and Centre blocks. This will be a new permanent entrance to Parliament that will allow for enhanced security screening of those visiting or working on the Hill.

We are also in the early stages of work on the Government Conference Centre. It will be fitted out for interim use by the Senate. When the Senate moves back to the Centre Block, the Conference Centre will remain in PWGSC's portfolio as a fully functional asset. That project is slated for completion in 2018.

What about East Block?

The rehabilitation of the East Block's oldest exterior wing, known as the 1867 Wing, is also in the very early stages. A seismic design for all of the East Block will be completed, followed by the rehabilitation of the wing's masonry, roofing, and windows. The remainder of the East Block will be worked on following the completion of the Centre Block project.

Again, each one of these projects is on time and on budget. Since 2006, the government has invested $1.1 billion in the rehabilitation of the parliamentary precinct. An additional $1.6-billion investment for work through to 2018 has been approved.

We are now focused on planning for the rehabilitation of the Centre Block. In March of this year, we began a consultation process and engaged with architectural, engineering, and construction associations on the future procurement of major contracts. The feedback we received will be used to develop future requests for proposals. We remain on track to empty the building in 2018.

I would be happy to answer questions you may have on the progress to date for Centre Block.

Let me turn now to security on Parliament Hill.

In every project it delivers in the parliamentary precinct, my department works with the RCMP and with the Senate, the House of Commons, and the Library of Parliament to implement their security requirements. The bollards, security cameras and the new guard huts at the main entrance to the Centre Block are examples of such requirements.

We will continue to work with a unified security force and our parliamentary partners in delivering projects that meet their requirements.

Finally, allow me to underline the strong oversight and accountability framework that guides our work. This includes a framework for solid, third-party oversight encompassing contracts, schedules, and costs, as well as quality and design, quarterly and annual reports to the Minister of Public Works and Government Services and to the Treasury Board Secretariat, and internal and external audits and evaluations.

Both the Auditor General and the private sector have observed that PWGSC has in place sound project management practices for the rehabilitation of the precinct. An independent audit in 2012 concluded that sound practices, systems, controls, and outputs were in place in its assessment of six major crown projects.

Those who, as all of you do, work every day within the parliamentary precinct do not have to look very hard to appreciate that this is a program of great scope and vast complexity. Let me assure you that the responsibility of preserving these heritage buildings and making sure they realize their full potential is not taken lightly. Safety, security, functionality, and fiscal responsibility are of prime importance. Quality construction and attention to the smallest detail, balanced with sound stewardship decisions, is of the essence. These buildings have been entrusted to us by the generations that came before us. We are making sure they are preserved for the Canadians of tomorrow, and we remain mindful that every dollar spent counts and must be accounted for.

I look forward to demonstrating the intricacies of the LTVP during our tour of the West Block following your questions.

Thank you very much, Mr. Chair.

[The Chair, NDP, Pat Martin]

Thank you, Ms. Chahwan. We look forward to the tour as well.

I think we have time for at least one full round of questioning, and I think we should leave ourselves 10 minutes or so to get geared up and head over so that we can have a full hour at the West Block. So with the committee's agreement, we'll do our regular six spots—one full round of five minutes each.

To begin for the official opposition, the NDP, Mathieu Ravignat.

[Mathieu Ravignat, NDP, Pontiac, QC]

Thank you, Mr. Chair.

Thank you to the witness for being here and for your interesting presentation.

Your 2013-14 departmental performance report basically says that the planned spending was $320.6 million, but the actual spending was $364.6 million. That's $44 million over, yet you claim that at most, it was under-budget and on time.

Can you explain that contradiction?

[Nancy Chahwan]

This is only an apparent contradiction. The planned spending in the main estimates and the RPP is really just that—a plan. The DPR recognizes the actual spending done and registered at the end of the year. The $44 million reflects an acceleration of work, mainly on the West Block and the Sir John A. Macdonald Building. So it is still within the approved budget.

[Mathieu Ravignat, NDP, Pontiac, QC]

What explains the acceleration of work?

[Nancy Chahwan]

The initial layout of the expenditures over several fiscal years reflects planning early on for these projects. As we start the work, we work very closely with the construction manager and the designer, the prime consultant, to see what work packages can be done in parallel instead of sequentially. That's part of how we can sometimes accelerate the work from out years to the current year.

[Mathieu Ravignat, NDP, Pontiac, QC]

So the projection of being on time wasn't being met. It demanded acceleration of certain types of work, and that incurred more costs. Would that be a fair characterization of what you just said?

[Nancy Chahwan]

That is a fair question, Mr. Chair, but it is not about accelerating the work to be able to stay on time. Our evaluation of being on time...and by the way, if I can specify, this is not a PWGSC internal estimate. We have third-party costs and schedule experts that help us do that, and we have audits that confirm that.

We are on time per the initial baseline of the project delivery. Accelerating the work may allow us to finish ahead of time, but these projects are very complex, as you can appreciate, so that gives us some float in the schedule.

[Mathieu Ravignat, NDP, Pontiac, QC]

Sure.

It also says 95% of projects were delivered on time. What 5% wasn't delivered on time?

[Nancy Chahwan]

I have spoken in my introductory remarks about the six major crown projects and major capital projects. Those are all on time and on budget. The indicators of on time and on budget that you see in the departmental performance report for 2013-14 include other kinds of projects under LTVP, and specifically, what we call recapitalization projects. Those are projects that allow us to accelerate some work, given building condition reports that—

[Mathieu Ravignat, NDP, Pontiac, QC]

Let me just be a little bit more specific. I guess what I'm looking for is the projects that are on time. I don't have a lot of time, so if you could just give me that information, that would be great.

[Nancy Chahwan]

Those are four recapitalization projects. One of them is the Canada's Four Corners envelope rehabilitation of the building on the corner of Metcalfe and Sparks. The project scope had to be revised because of a building condition report showing that other facades needed work. We actually halted that project, and thus it shows “late” for on time. The others are facade and parapet upgrades for the Victoria Building, fire alarm auditability upgrades for the Confederation Building, and finally business continuity of government for the House of Commons.

[Mathieu Ravignat, NDP, Pontiac, QC]

Have recent security concerns added to future burdens, whether it be budgetary constraints or time constraints? Are you being asked, for example, to change some of your plans in order to make the parliamentary precinct safer while you're doing this?

[Nancy Chahwan]

We are working very closely with the RCMP and the parliamentary partners to see what recent developments and security requirements are introduced and their impacts on the projects under way and for projects coming up. Depending on the design maturity of those projects, we can reassess the impacts of the new requirements. Some requirements are already being taken into consideration, like, for example, upgrades to the vehicle screening facility at the entrance to the Hill.

[The Chair, NDP, Pat Martin]

That concludes your time, Mr. Ravignat. Thank you very much.

Next, for the Conservatives, is Greg Kerr.

[Greg Kerr, Conservative, West Nova, NS]

Thank you very much, Mr. Chair.

Thank you for being here with us today.

I'd like to start by pointing out that no matter what they think of us here who occupy these spaces, Canadians are very proud of the fact that these are their national buildings. It means a lot to them. Part of my hope is that they'll see more public documentation of what goes on and why. People think of the Parliament Buildings. It's not the whole precinct, obviously.

I'd like you to take us through this long journey. Could you encapsulate it from the start, as you see it, to the completion, because it's major, and then perhaps give a little more detail on how you expect it will look? I think every Canadian should have a chance to visit these buildings. They are extraordinary, and they do belong to every Canadian. If you could fill us in a bit on that, I'd appreciate it.

[Nancy Chahwan]

This is, indeed, one of our driving principles, as we embarked on the long-term vision and plan. The plan itself respects not only the evolving requirements from the parliamentary partners, but also the need to preserve these heritage buildings for generations to come.

The LTVP, as I mentioned in my opening remarks, is really geared towards starting the rehabilitation of the Centre Block before the building systems are slated to become at critical risk of failure. We have several studies that point out that most of the building systems will be in that state starting in 2019. All the rest of the LTVP is actually a sequencing map to get to that priority. We have started by creating space so we can empty the buildings in the order of priority that the building condition reports were suggesting we should be adopting. What you have seen, for example, is the emptying of the West Block in 2011. That was predicated on creating enough space around the Hill, in the precinct, to be able to accommodate the functions that had to exit the West Block.

The Sir John A. Macdonald building will be ready in just a few weeks, and it will house the room 200 functions. Following that, we will see the completion of the Wellington building in 2016, allowing us to move out the members of Parliament offices from the Centre Block.

The next project to be finalized will be the West Block in 2017, and that will house the chamber functions for the House of Commons. We also need to make sure that we have interim accommodation space and chamber space available for the Senate before 2018. To support that, we are now rehabilitating the government conference centre, which will be ready for 2018. That will house the Senate interim chamber, as well as main offices for the leadership. We will also be working on some lease space.

This is the key sequencing that will allow us to make sure that the Centre Block is empty on time for the start of that rehabilitation project in 2018.

[Greg Kerr, Conservative, West Nova, NS]

Thank you very much.

How much time do I have left?

[The Chair, NDP, Pat Martin]

One minute.

[Greg Kerr, Conservative, West Nova, NS]

Maybe I'll double this in a question.

One point is that I really hope you're doing a lot of documentation of this, because I really want to emphasize that Canadians should go through this experience with us. They don't see it firsthand, but I think they should.

What surprises have you found in the buildings as you went along, which you may want to highlight?

[Nancy Chahwan]

That's a very interesting question.

On the first part, yes, we are keeping records of the work in pictures and video in some cases, and we are working on ways to make this information available to Canadians. Right now our website provides a lot of information on the projects under way.

Perhaps I can turn to my colleague to tell you about the interesting things we have found in West Block.

[Ezio DiMillo, Director General, Major Crown Projects, Parliamentary Precinct Branch, Department of Public Works and Government Services]

We are doing a number of things to document the processes we go through during the design. We are using laser technology to do videos of the buildings. In the interior we're partnering with Carleton University and Université de Montréal to do what's called BIM modelling, building information system modelling.

We have found a number of interesting artifacts on the inside of the West Block. We found a letter in the bottom of an elevator shaft some time ago that had been sent by a member of Parliament back in the 1930s or so to a constituent congratulating them on the arrival of a new baby. We also found the odd old tool in the building as well.

[The Chair, NDP, Pat Martin]

That's interesting. That's great.

Mr. Blanchette, for five minutes, please.

[Denis Blanchette, NDP, Louis-Hébert, QC]

Thank you, Mr. Chair.

I want to thank the witnesses for joining us. It's always nice to hear from them.

The Status Report on Transformational and Major Crown Projects released on December 4, 2014, provides completion dates for certain projects. For instance, the work carried out on the Sir John A. Macdonald Building should be 100% complete. That's obviously not quite the case.

What are your current projections? What does this mean for the budget and the planning of other work? Are there any additional implications?