Government Operations Committee on Nov. 16th, 2020

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

I understand, but a shipyard that represents 50% of the shipbuilding force is capable of doing both.

[The Chair, Conservative, Robert Gordon Kitchen]

Excuse me for interrupting, Ms. Vignola. You have just 30 seconds.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Okay.

We have a shipyard that is capable of meeting the needs of both of these areas, defence and science, and that represents 50% of the building force. Yet it only received $3 billion compared to $77 billion for the other two shipyards.

I am trying to understand the logic.

[Anita Anand, Liberal, Oakville, ON]

As you know, Davie is in the process of qualifying to be the third shipyard. The two shipyards in the NSS at the current time are VSY and Irving, and that is why we have this division of labour between two shipyards, with other shipyards, including Davie, being able to qualify for builds.

In fact, Davie has been awarded $2.1 billion in national shipbuilding strategy contracts. They are presently converting three icebreakers for the Coast Guard, and they're undergoing this process to become the third shipyard. Davie is an important partner for Canada, and we are very happy to work with the Davie shipyard, as I mentioned. That is the reason why this number, $2.1 billion, should be highlighted at this time.

[The Chair, Conservative, Robert Gordon Kitchen]

Thank you, Minister.

We will now go to Mr. Green.

You have six minutes.

[Matthew Green, NDP, Hamilton Centre, ON]

Thank you very much, Mr. Chair. Through you, let it be said that this honourable minister does not shy away from committee, and so I appreciate her repeated appearances before us. These are very important topics.

In her the opening remarks, the minister touted the government's seven contracts for COVID vaccinations. I would suggest to you, and all of committee in fact, that the vaccinations are the crux of our getting out of what could potentially be a third and fourth wave of COVID really crippling the economy. However, I'm still unclear about the difference between true purchase contracts—money down, paid up—and purchase options.

Can the honourable minister please explain why, on September 25, in the Prime Minister's announcement of the new agreements, the language is always in terms of supplies “up to”, except for Pfizer, which actually talks about supplying a minimum dosage?

Out of these, how many of them are actually cash contracts in the agreements?

[Anita Anand, Liberal, Oakville, ON]

Thank you so much for the shout-out, MP Green. I appreciate it. I've been at committee four times in my first year of being a member of Parliament. It's amazing.

I used to teach contract law, so it gives me great pleasure to be able to discuss this particular topic with you.

In particular, we should note that under our agreements with each supplier, we purchased a base number of doses. From Moderna, for example, we purchased 20-million doses. We also built flexibility into our contracts to enable us, once we have approval from Health Canada or we see that a vaccine is extremely successful with a particular demographic group, to go back to that company and say, “Look, we have options in this contract, and we want to exercise them now.” Then they would sell us additional doses of the vaccine.

That's what “up to” means. The “up to” means that we have the ability to exercise additional options if we choose to do so.

[Matthew Green, NDP, Hamilton Centre, ON]

How many have we actually purchased?

[Anita Anand, Liberal, Oakville, ON]

We have purchased...and this was on the advice of the vaccine task force. What the vaccine task force did was provide advice to the Public Health Agency of Canada, who then—

[Matthew Green, NDP, Hamilton Centre, ON]

I'm sorry, but if you could, just how many do we have? I have lots of questions about the task force, but I'll save that for another day.

[Anita Anand, Liberal, Oakville, ON]

I'm sorry. My sincere apologies.

The doses we have purchased vary between the different candidates. Generally speaking, for the majority of the contracts, we have purchased an initial 20 million doses. For Sanofi, Novavax and Janssen the number is either higher or lower. I can go into those details, if you prefer.

[Matthew Green, NDP, Hamilton Centre, ON]

When you talk about purchase options versus actuals, I'm sure that as somebody who taught contract law you'll recognize the need to really quickly move into these negotiations. Yet it has been reported that other countries—the United Kingdom, Australia, the United States and 27 other European countries—are actually ahead of us in line. What's the timeline? Notwithstanding the fact that we have these contracts recently announced, when we know that almost 30 other countries are ahead of us in line, what should we be expecting? Are we still expecting early 2021?

[Anita Anand, Liberal, Oakville, ON]

I actually think it is somewhat inaccurate to talk about a “line”. There's no line of countries for vaccines. In fact, our agreements are on par with the European Union, Ireland, Japan, Australia, New Zealand and many other countries in terms of our anticipated delivery dates. But rather than focus on those delivery dates alone, I think we need to also focus on the date the approval comes from Health Canada. No vaccine will be distributed anywhere unless we have the approval of the independent regulator called Health Canada.

[Matthew Green, NDP, Hamilton Centre, ON]

Are you suggesting that the other countries didn't secure real contracts of real purchases and not just the options ahead of us, and that by purchasing ahead of us they wouldn't be in queue ahead of us?

[Anita Anand, Liberal, Oakville, ON]

What I'm suggesting is that we negotiated very hard with seven suppliers for assurance that we would have access to a base number of doses, which I indicated was around 20 million for four suppliers—

[Matthew Green, NDP, Hamilton Centre, ON]

So you're saying here tonight that we're going to get that at the same time as the other countries.

That's the good news.

[Anita Anand, Liberal, Oakville, ON]

I am saying that the delivery of vaccines into this country depends on Health Canada approval. Once Health Canada approval is obtained, for certain suppliers, we will see deliveries into Canada in the first quarter of 2021.

[Matthew Green, NDP, Hamilton Centre, ON]

Let's talk about those agreements. Brazil and other countries are disclosing almost complete agreements. You would appreciate also, in lecturing for contract law, that not disclosing the agreements actually favours the seller and not the buyer. Why doesn't Canada release the actual agreements like Brazil did?

[Anita Anand, Liberal, Oakville, ON]

Well, good question; I'm not sure of the contract terms between these vaccine companies and the Government of Brazil, so—

[Matthew Green, NDP, Hamilton Centre, ON]

I can share it with you. It's public. I'm just wondering why our government hasn't made it public either.

[Anita Anand, Liberal, Oakville, ON]

Let me continue, if I could.

The point I want to make is that there are differences between Brazil and Canada. For example, if you take AstraZeneca, there are clinical trials occurring in Brazil. Clinical trials are not occurring in Canada. Another point to mention is biomanufacturing capability. There is that capacity in Brazil. There isn't in Canada.

There are differences between these jurisdictions that in turn lead to different contracts between them.

[Matthew Green, NDP, Hamilton Centre, ON]

Would you not agree, though, that by keeping contracts secret, it favours the seller and not the buyer? It seems like a basic principle.

[Anita Anand, Liberal, Oakville, ON]

What I agree with is that transparency is important. That's why this is my fourth appearance at committee.

[Matthew Green, NDP, Hamilton Centre, ON]

And we thank you for it.

[Anita Anand, Liberal, Oakville, ON]

That's why we have disclosed $6 billion of PPE contracts on our website. That's why we turned over 500 pages of documents or more to this committee. That's why we're complying with the motion that was passed in the House. That's why we are complying.