Government Operations Committee on Oct. 8th, 2024

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Yes.

[Jerry V. DeMarco]

That process is managed by ISED. The witnesses earlier today would have been involved in approving the creation of this fund at Treasury Board. Who actually made the decision for that off-ramp, where things can be fast-tracked, I don't know.

I'll ask Mr. Blouin, were we given that information, as to who approved the process set out in exhibit 4.2?

[Nicolas Blouin, Director, Office of the Auditor General]

We were not given that information.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

I'm not looking for a name, but perhaps a position. Who would have the authority to write that sort of rule in place in a process?

[Jerry V. DeMarco]

The process, generally, was managed by ISED. It would have required some level of Treasury Board approval. The program itself would have required some level of Treasury Board approval. I would suggest you speak to the deputy minister at ISED to find out, specifically, what position was involved in approving that aspect of the flow chart. I do not have a certain answer for you, unfortunately.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

I'm not sure if you answered this earlier. Is this a standard rule for departments to have in place when seeking approvals for certain grants and contributions?

[Jerry V. DeMarco]

Again, that's probably a question better directed to the deputy ministers, and, at a global level, the comptroller general, who was here earlier. I haven't seen that particular example of fast-tracking with a letter to the Prime Minister in other grants and contributions audits we've done recently. We've only looked at a few, and there are dozens and dozens of these programs. It's better to ask someone who has more of a global view of this process, and that would be Treasury Board.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Okay, thank you.

In many audits your office has completed over the last few years, one of the primary issues that has been highlighted in those reports has been the lack of documentation and perhaps even mismanagement. When you see continued mismanagement called out over several years with no improvements, would you agree that a full forensic audit would help to give a full picture of the mismanagement?

[Jerry V. DeMarco]

One could scope an audit to look at it in a global sense, or one can look for the trends across our audits. I would say that in both the audits I've spoken about earlier today as well as some of the other ones that come to mind, we have looked at the issue of open and transparent process and documentation, as you just talked about. We've had concerns about eligibility. We've had concerns about whether the expected outcomes are being achieved, for example, in the net-zero accelerator.

We've also had concerns about whether grants and contributions programs are properly being measured, monitored and verified. I can speak to those at a general level by connecting the dots amongst many reports. Whether we would need to do another report to do that, I'm not sure, but those are themes that have come up across several reports.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

A fuller audit could be in order. Is that right?

[Jerry V. DeMarco]

An audit of that level would need to be approved by the Auditor General in terms of looking at such a large.... It would be up to her to decide, looking at the opportunity cost against other audits. I can tell you that these themes have already come up in several audits, and we can connect the dots at least for those.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Thank you very much. I appreciate that.

I'm going to turn over the last few seconds of my time to Ms. Kusie.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you, Ms. Block.

Given the larger context of today, Chair, we have the 2019 Treasury Board guidelines, which clearly have not been adhered to. We saw the bad audit out of Global Affairs Canada. We now have a part-time minister. I believe, Mr. Chair, that this necessitates greater oversight, as has been brought to the attention of the committee by my colleague. As such, I'm putting on verbal notice the following motion:

Given that,

grants and contributions by Environment and Climate Change Canada have increased by $625 million since 2016;

only 5.5% of all grants and contributions from ECCC were reviewed in a departmental audit;

the audit stated that there was a potential for abuse and mismanagement that may lead to “reputational and legal damage”; and

this review was only an internal review and not independent;

the committee call on the Auditor General to complete a value for money and performance audit on the grants and contributions program at Environment and Climate Change Canada and report the findings to the House.

Thank you very much, Mr. Chair.

[The Chair, Conservative, Kelly McCauley]

Thank you very much.

We'll now turn to Mr. Sousa to finish off for five minutes, please.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

Thank you.

Canada uses 2005 as its baseline in terms of the emissions reductions commitments. Is that right? How much has been reduced since 2005?

[Jerry V. DeMarco]

Based on the latest official figures from Environment and Climate Change Canada, which are the 2022 emissions, it would be between 7% and 8% from 2005 levels to 2022. The target is 40% to 45%.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

In the absence of those measures, how much higher would emissions be by 2030? Some of these are estimates. Is that right?

[Jerry V. DeMarco]

Environment Canada does a projection, which people may call a “business as usual” or an “extrapolation”, as to what would have happened in this alternate world where none of these measures were in place. However, there are so many assumptions in that sort of modelling that I can't tell you a number that I'm comfortable with as to what the emissions would be today without any measures. They would obviously be significantly higher than today, but I'm not going to put a number on it.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

I believe the Canadian institute of environment estimates that it would be about 41% higher. Is that correct?

[Jerry V. DeMarco]

You would have to ask them.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

Is that what you've read, on their part?

[Jerry V. DeMarco]

I don't recall reading that specific number, but if that's their number, that's.... It would have assumptions associated with it, though.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

I guess my point is that we recognize.... I agree we need a sustainable effort to go forward. I want to look at the environmental benefit, but I also want to look at the economic benefit, the green economy and other things we're trying to put in force to enable us to improve economic circumstances, environmental circumstances and social benefit. There is a benefit when all of this comes to be.

We can look backwards. We can go back to the days of coal plants in Ontario, for example. When we decarbonized our system, we got part of the cap and trade initiative. We became part of the western climate initiative, alongside Quebec, and we were taking advantage of a great benefit to reduce emissions and climate impacts on society and local communities. That's what Canada is trying to do in part of the overall Paris Agreement. Those are the efforts we're trying to proceed with. Measures are being taken and enacted. There are things we can do to improve upon this. That's why we have internal audits. That's why we make these efforts. That's why we rely on people like you, the experts in this area, to guide us and provide some direction on how to proceed in a better way.

The question is this: Is it not appropriate, then, to take measures, audits and reviews to sustain and support the program? Others believe there should be no program. Others are assuming there is no climate change. Others are saying we should just go back to the glory days of coal plants, emissions and manufacturing without looking at alternatives.

Mr. DeMarco, can you give us your impressions on what we should do, going forward? Is it not appropriate to do what we're doing?

[Jerry V. DeMarco]

Let me answer that at a high level.

There are measures, especially regulatory ones like carbon pricing, that have the ability to achieve significant reductions. We don't even have enough measures now to add up to our target of 40% to 45%. As I answered in a question earlier, we're in a position where we need more measures to do so.

Regarding the fact that we have some measures providing added value, does that mean we can rest on those laurels? No, we are far from achieving our target. On a comparative basis, we're the worst among the G7. One cannot say that we're doing something that's good enough just because it's better than nothing. Compared with our neighbours, and looking towards our own target, we're not doing enough.

[Charles Sousa, Liberal, Mississauga—Lakeshore, ON]

However, we're attempting to do more. That's the point. That's the whole crux of the matter. We have taken these initiatives. We realize we can do better. We're taking those matters in control.

I want to highlight some allegations being proposed.

Do you see the Prime Minister making these decisions unilaterally with submissions being put before him? Is there any interference by government officials or elected officials to obstruct the reduction of emissions? Is it not the policy to try to foster greater reductions overall?