Government Operations Committee on Aug. 21st, 2024

[Parm Bains, Liberal, Steveston—Richmond East, BC]

Thank you, Mr. Chair.

You know, it's funny being hung up on just the events. I think we should go back to the importance of the justification of its being situated in an area where diplomatic relations can occur in a favourable manner.

Maybe I'll go back to Mr. Allen or Mr. McCubbing on this. I think you mentioned that we are competing. This is a financial sector and sort of the headquarters of the world when it comes to global trade and some of these missions. Looking at the importance of being situated, if we look at Vancouver, for example, many of the consular offices and residences are located in and around areas where there's access to, as you mentioned, critical minerals—and that strategy is important for Canada. We have over 1,500 mining headquarters located in the Vancouver area.

Even in my office specifically, if you look at the minister's regional office and the proximity of access to consul generals and organizing and setting up meetings, I had the opportunity to welcome consul generals not only from the United States but also from Chile to the largest commercial fishing harbour in Canada, which is located in Steveston Village in my city of Richmond, British Columbia. It's a place where over 100 million pounds of seafood is off-loaded annually, which directly results in over $200 million in revenue for the region. Those things are important for many of these consular offices to consider, so maybe you could speak a little bit more about that.

We recently had Australian representatives visit the Seaspan shipyard, where we just announced and launched the largest oceanographic vessel that has been built recently. We have a joint supply ship that will be ready to be announced later this fall, so there's a lot going on.

Much of our science and our innovation in Canadian technology and things that we have to offer and share need to be not only translated through meetings but also through the proximity of people being in an area where we can have consecutive, back-to-back meetings and not have to travel for lengths of time.

New York City is not the easiest place to get around, so maybe you can speak to all of those things that matter. We talked about the trillions that are at stake here, and we need that money to provide the services and supports that Canadians need on a regular basis here for the people who are the most vulnerable.

Could you speak to the importance of the proximity of the location?

[Mark Allen]

I'd be pleased to.

As I think we said earlier, there's an incredible concentration in New York City of people, of capital and of institutions. It's a very large city. It can be difficult to navigate, so that centrality is, I think, incredibly important for us as well as for like-minded nations who, as I said, are also our economic competitors.

When we organize events, one of the success factors is the uptake and attendance: how many people we invite and how many people actually attend. When events are central and when they're held at a residence, the ratio of uptake is higher among the people whose help we need to advance our interests.

Thank you.

[The Chair, Conservative, Kelly McCauley]

Thank you very much.

Mrs. Vignola, go ahead, please, for two and a half minutes.

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

Thank you very much, Mr. Chair.

I don't know if the witnesses can answer my next question. If not, they can send us an answer in writing.

Before 2022, purchases amounting to more than $4 million required an authorization. In 2022, that limit increased to $10 million.

In five years, from 2017 to 2022, how many times did GAC have to request authorization to purchase or build a home with a value exceeding that limit?

[Stéphane Cousineau]

I thank the member for her question.

I will defer to my colleague Ms. Carruthers, who is responsible for finances.

[Shirley Carruthers, Assistant Deputy Minister and Chief Financial Officer, Corporate Planning, Finance and Information Technology, Department of Foreign Affairs, Trade and Development]

Thank you Mr. Chair.

What I can tell you is that between 2016 and 2021 the department actually had to go to Treasury Board Secretariat a total of 44 times to get transaction authorities to go forward with different transactions, such as entering into a lease transaction and/or purchasing a building. Thank you.

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

Okay.

If I understand correctly, it happened 44 times between 2016 and 2021. Is that number higher than it used to be, compared to the period from 2011 to 2016, for example? Is one period similar to another?

[Shirley Carruthers]

Mr. Chair, I'm sorry, but I don't have that information with me, and I was unable to locate it prior to coming to this committee. However, I can go back to the department and see if I can locate that information.

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

Thank you.

[The Chair, Conservative, Kelly McCauley]

Mr. Bachrach, go ahead, please.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair.

I'm interested in Global Affairs' evaluation of risk surrounding this transaction. Perhaps our witnesses could describe what Global Affairs saw as the greatest risk involved in this particular transaction, the purchase of the new apartment, and more generally the various risks that were evaluated as part of the decision-making process.

[Stéphane Cousineau]

Thank you very much for this question.

Indeed risk is an important element that we consider as we look at our process and what's included in our framework, as I said before. When it comes to risks and the details of those risks, I will turn to my colleague Mr. Dubeau to talk about those.

[Robin Dubeau]

Thank you.

The business case we build for such purchases covers multiple angles, and one of them is absolutely the risks associated with the transaction.

There are different transactions and there are different risks associated with those transactions. Of course there's the risk associated with the timing of it. There's also risk with the assumption that we make when we do the financial evaluation. As the transaction progresses, we know more information, more than estimation, so that makes it a bit more secure. There's also the assessment of the asset condition that is a risk when we do this kind of transaction. There's a financial risk with currency fluctuation as well because we're paying in U.S. dollars, so we want to take that into consideration. There's market availability, so that would be part of the risks in the option analysis and the business case we've put together.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Does the risk have to do with the future value of the real estate? I know in this particular building and in Steinway Tower in particular we've seen really significant decreases in the asking price for units. More than 20% of the units in the building have never sold. The vacancy rate is estimated to be around 50%, and the project's lender has written off debt due to not being able to secure returns.

I'm just wondering what the evaluation of risk is when it comes to the future value of the property, in the opinion of Global Affairs.

[The Chair, Conservative, Kelly McCauley]

I'm afraid there's no time left for an answer but, Mr. Bachrach, you'll have one more round after this, so perhaps we'll be able to get to it then.

Mr. Barrett, go ahead, please, for five minutes.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Okay, my question is for the deputy consul general, Mr. McCubbing.

You signed off on the purchase of this property on Billionaires' Row for Justin Trudeau's media buddy Tom Clark. Is that correct?

[Robert McCubbing]

Thank you, Mr. Chair.

Yes, I was the delegated authority from the property bureau at headquarters to provide the wet signature on the transaction.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Are you aware, in relation to this transaction, its approval and your subsequent signature, of any correspondence with the Prime Minister's Office, the Privy Council Office or the Minister for Global Affairs' office?

[Robert McCubbing]

I'm not aware of any communication between any of those agencies and our office.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

You weren't given any visibility on communications with the minister's chief of staff in the form of a heads-up on this.

[Robert McCubbing]

No. I was not involved in that communication.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

How did you know that you were to sign it?

[Robert McCubbing]

I was provided an email with a delegated letter authorizing me to sign the contract.

[Michael Barrett, Conservative, Leeds—Grenville—Thousand Islands and Rideau Lakes, ON]

Who was the email from?

[Robert McCubbing]

It was from my colleagues in the property bureau. It was the director general in charge of real property.