Government Operations Committee on May 17th, 2016

[Steven Blaney, Conservative, Bellechasse—Les Etchemins—Lévis, QC]

If I read between the lines, you're telling us that the answers to these questions will come toward the end of fall or maybe later than that.

Okay. On our side, we'll continue our work.

I'd like to mention that we've heard witnesses who said they were satisfied with your services. They were mostly from smaller departments agencies. We asked them about this. We checked with them to find out if they were satisfied with your work up to now. The Public Service Commission, the School of Public Service, and the Office of the Public Service Integrity Commissioner were satisfied with your services.

Thank you, Mr. Parker.

I will now turn to my favourite engineer who works for the Department of Public Services and Procurement.

Ms. Lemay, in the budget, $2.1 billion is set aside for this year, a large part of which will go toward replacing the heating. Would you be able to explain to us the breakdown of these expenditures and tell us what kind of work is going to be carried out in that regard?

[Marie Lemay]

Mr. Blaney, you will understand that this is a project that is very important to me, but I think I will ask Mr. Wright or Mr. Radford to provide you with the details. Indeed, it's a very big project.

[Kevin Radford, Assistant Deputy Minister, Real Property, Public Services and Procurement Canada]

Thank you for the question.

In her opening remarks the minister spoke to the $1.2 billion for ESAP. About a month or so ago I was at the Royal Institution of Chartered Surveyors in Washington, and we were talking about how much infrastructure contributes to greenhouse gas emissions. It's about 40% internationally. Taking the heating plants in the systems that provide heating and cooling to about 85 different buildings using 1950s technology is a huge coup from a GHG perspective. I can provide the committee with the detailed breakdown of each of the projects associated with that particular project. A number of projects are going on right now around the design and the planning of what that system will look like, but some remediation work is also going on in parallel at the pumping stations, at the boiler plant, etc. It's quite a detailed list. Would you like me to provide the details?

[Steven Blaney, Conservative, Bellechasse—Les Etchemins—Lévis, QC]

It's clear with this $1.2 billion that it is going mainly into the national capital region, but the total amount is $2.1 billion, so that leaves $900 million. Is it possible to tell us what this amount is dedicated for?

[Kevin Radford]

Part of the $2.1 million was a program integrity submission that we had put forward in budget 2016, which basically was looking at the current state of the assets we have within our portfolio. In many cases the operating budgets that were supporting those assets were below standards in the private sector. We used our main service provider, Brookfield Global Integrated Solutions, to provide us with some comparators of the status of services in our buildings versus what was done in the private sector, and our services were considerably lower, so a portion of that is to lift our ability to operate the assets we have and to raise those particular standards.

For instance, for many of the mechanical systems in our buildings, like those you would have in your car, we weren't going beyond any preventative maintenance. In fact we were just doing corrective maintenance on many of those mechanical systems and supporting systems in the buildings. We are also just leveraging health and safety. So there was a large repair bow wave that had been created.

[Steven Blaney, Conservative, Bellechasse—Les Etchemins—Lévis, QC]

And it's all over the infrastructure of your buildings?

[Kevin Radford]

It's all over nationally.

[Steven Blaney, Conservative, Bellechasse—Les Etchemins—Lévis, QC]

Good.

[The Chair, Conservative, Tom Lukiwski]

We'll now go to Mr. Weir for seven minutes, please.

[Erin Weir, NDP, Regina—Lewvan, SK]

I would like to follow up on an issue that I raised with the minister about the use of Canadian steel in federal infrastructure projects. In its written response to my previous inquiry, the department said that the new Champlain Bridge corridor contract was awarded to the lowest compliant proposal based in part on a fixed price for the design and construction work. It also said that the contract contained specific requirements related to the performance of material, but did not contain requirements related to their origin.

It sounded as though the minister suggested that it would be possible to look at the amount of Canadian steel that was being used. I'm just wondering how that fits with a procurement requirement that doesn't seem to take into account the origin of the steel.

[Marie Lemay]

Mr. Weir, we are very seized with that issue. As the minister said, we are discussing this, but as you probably know, it is complex in terms of having to specify and some of the different rules and regulations around the procurement. Maybe Ms. Campbell can give you a little bit more detail on specifically the steel.

[Lisa Campbell, Assistant Deputy Minister, Acquisitions Branch, Public Services and Procurement Canada]

I'd be happy to.

Mr. Chair, Canada uses a number of mechanisms to leverage the largest public “spend” for the benefit for Canadian companies. We do it in two ways. One is by giving them access to global markets through trade agreements, and the other is by applying policies that we have that ensure that procurement is leveraged for industrial benefit to Canada. A Canadian-content policy encourages industrial development in Canada by limiting procurement to Canadian goods and services where there's sufficient competition to do so in Canada. We also have an industrial technological benefits policy that stimulates Canadian industry participation in military procurements and investments in other high-value sectors of Canadian industry.

Thank you.

[Erin Weir, NDP, Regina—Lewvan, SK]

I'm just wondering if you could explain how that fits with the department's written response that there was no requirement, or no expectation at all around the steel being made in Canada.

[Lisa Campbell]

We will look at every procurement. We'll look at the requirements of the procurement and where their long-term value for Canadian businesses is. We engage with industry at the outset of procurements. We hear their feedback and increasingly the parts they're very interested in are the long-term in-service support and maintenance. In complex procurements that's where they see high value. So we will look at raw materials as well as at in-service support and maintenance over the long term.

I can share with you that fully 38% of procurements go to Canadian small and medium-sized businesses. We really do a lot of outreach to make sure that Canadian businesses are engaged and have access to federal procurements.

[Erin Weir, NDP, Regina—Lewvan, SK]

How heavily do those concerns about industrial development and Canadian jobs weigh in to these procurement decisions on civilian infrastructure?

[Lisa Campbell]

They're top of mind for us. We work with client departments and also Innovation, Science and Economic Development Canada. They recently hired a firm to help them do a map of Canadian industrial capabilities so that when we do procurements, we can target them making sure we take advantage of our industrial strengths both existing and nascent.

[Erin Weir, NDP, Regina—Lewvan, SK]

Okay. I'm struck by the fact that your report on plans and priorities for the defence procurement secretariat says that it will “work closely with National Defence and the defence industry to leverage purchases of defence equipment to encourage suppliers to invest in innovation and exports, to create jobs and economic growth in Canada”. Would you say there's a similar level of priority for civilian procurement?

[Lisa Campbell]

As I think the minister mentioned, and as you may have seen in the mandate letters, we're working with Treasury Board to make sure that the socio-economic benefits that the government identifies can be applied in a holistic way, not just to defence procurement but to all federal procurement. As I think the committee is aware, they're about half and half. Of the roughly $17 billion that's spent each year, half is large complex military procurements, and the other is major procurements such as nuclear facilities and bridges. What we're doing is modernizing our procurement tools to make sure that whatever the socio-economic desire is, it can be applied in procurement to the extent possible.

[Erin Weir, NDP, Regina—Lewvan, SK]

Excellent.

Another thing I wanted to follow up on was this question of using federal government buildings as a potential venue for affordable housing. I had previously asked how many such sites there were in Saskatchewan, and the written response from the department was that four federal buildings had been examined, and none of them had very good potential for affordable housing. Will that information be used to try to encourage other federal housing programs to provide greater support to Saskatchewan, given that it seems that our province won't get much out of this repurposing of federal office buildings?

[Kevin Radford]

We are working very closely with ESDC and CMHC in developing an inventory of our holdings that may be applicable to the affordable housing initiative. We have looked at and examined all of the homes that we have in our current jurisdiction. Many of those are up in the north. Some of them are occupied and some are not, and some are in a state of disrepair. Our contribution thus far has been to create a template of where they're located, what type of zoning they are in, what their condition is, and what would be the easiest way to move them into other sectors to support this initiative. We created this template and now we're reaching out to custodians. I should mention that we look after about 30% of the overall custodial space, including institutions like the RCMP, where my colleague Alain comes from, which also have homes, and DND, etc. We're going to share the template that we've put together with those custodians so that we can gather a Government of Canada listing. That's about where we are at. Our contribution is developing that inventory.

[Erin Weir, NDP, Regina—Lewvan, SK]

Okay, it sounds like you have, and that for Saskatchewan there's really not much prospect of these buildings being used to provide affordable housing. Therefore, I wonder if that information is somehow going to be communicated to other departments so that Saskatchewan does receive its fair share of federal investment in housing.

[Kevin Radford]

The overall departments that are responsible for affordable housing and for creating a policy in that jurisdiction are largely ESDC and CMHC. So what we are doing is providing the inventory and then supporting that in a collaborative way, so that as they develop policies and mechanisms to transition either homes or buildings in our infrastructure for other purposes, we'll have that ready for them to inform that policy discussion as it goes on. That will likely be in the fall time frame.

[The Chair, Conservative, Tom Lukiwski]

Mr. Ayoub, for seven minutes please.

[Ramez Ayoub, Liberal, Thérèse-De Blainville, QC]

Thank you, Mr. Chair.

With respect to shared services, there is a request for $60.7 million, which is comparable to last year's amount. As for translation and other linguistic services, we are looking at net expenditures of about $6 million, of $6.3 million for 2017-18 and $7 million for 2018-19.

The number of full-time employees for these three years is anticipated to drop from 801 to 734, and then to 672. There will therefore be a reduction. I am left wondering why the planned expenditures for translation and other linguistic services would increase when the number of full-time equivalent employees is decreasing.

Is there an explanation for this?

[Marie Lemay]

Translation bureau revenues are down, but there is a delayed reaction, that is to say that attrition and departures do not occur at the same pace as the drop in revenues.