Government Operations Committee on Sept. 23rd, 2025

[The Chair, Conservative, Kelly McCauley]

Thanks very much.

Ms. Gaudreau, go ahead for six minutes, please.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Thank you, Mr. Chair.

Ms. Hogan, thank you for your time today. Your contribution to this committee is invaluable. I'm brand new to this committee, but I'm looking forward to getting your next report on recruitment and training in October.

Something struck me when I read your report. I get the sense the government is flying by the seat of its pants. How can it be that departments such as Public Services and Procurement Canada and National Defence lack so much hard data? That's been my first unpleasant surprise since joining this committee. It's quite frustrating.

How can they not know how many federal public servants they need offices for? How are they going to get those numbers? I'd like you to comment on that.

[Karen Hogan]

You're right. We've found that there's not enough data to support informed decisions. There is some data, but it isn't being gathered in a consistent fashion across government. From what we could tell, each department is responsible for figuring out how to monitor its employees' in-office attendance.

We identified the methods used and recommended that the government implement a standardized method to ensure that the whole public service is gathering this data the same way. Once that's done, we'll know how public servants are using office space and decisions can be made about which properties to dispose of.

To sum up, we lack that basic data. There has been progress, but I think a single whole-of-government approach is needed.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Mr. Chair, I'd like to ask the Auditor General about the real estate portfolio. It shrank from 6 million square metres in 2019 to 5.9 million square metres in 2024.

Seriously, how is it possible that so little was done in five years?

[Karen Hogan]

We asked that same question. In 2017, the government realized that federal properties were underutilized. In 2019, it decided to cut the amount of office space in half by 2034, but no funding was allocated to that effort between 2019 and 2024.

The 2024 budget allocated money to Public Services and Procurement Canada and Treasury Board to do the work, so I was hoping to see much more progress. The government can make announcements and set targets, but without funding and staff to get it done, very little progress will be made. That's what we're seeing here.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

According to your report, Public Services and Procurement Canada doesn't know how many public servants are using office space, so it must be hard to manage a portfolio when there's a housing crisis.

I can see the connection to the data. There may have to be a cultural shift to standardize the rules so you can do your work, but, at the same time, when the government makes announcements, it has to walk the talk.

I'd like to talk about F‑35s now. In 2011, when I was the political attaché for the office of the member for Laurentides—Labelle, those jets were a big election issue. That was 14 years ago, and there have been many ministers of defence under Harper, Trudeau and Carney. However, you've told us that the Bagotville and Cold Lake bases are three years behind schedule in building the infrastructure needed to house—just house—fighter jets that cost billions of dollars.

I think being that far behind schedule is hard to fathom.

At what point should we start worrying?

[Karen Hogan]

I think it's important to note that National Defence had the right idea. The department decided it would have to upgrade the Bagotville buildings before Canada chose which fighter jet to replace the CF‑18s with, but it didn't have all the details. Once the decision was made to acquire F‑35s, National Defence got a lot more information. Once it realized everything it would need in the buildings, it started falling behind schedule.

There have been efforts to mitigate that, though. There are temporary buildings, but that leads to higher costs. There was a lack of planning and inadequate risk management. We found that risk management was more reactive than proactive. I think this is an example of how the department tried to do the right thing, but, because of reactive risk management, it now finds itself having to use temporary buildings.

[Marie-Hélène Gaudreau, Bloc, Laurentides—Labelle, QC]

Thank you, Mr. Chair.

[The Chair, Conservative, Kelly McCauley]

Thanks very much.

Mr. Patzer is next.

[Jeremy Patzer, Conservative, Swift Current—Grasslands—Kindersley, SK]

Thank you very much, Mr. Chair. Thank you very much, everyone, for being here today.

When it comes to the staffing and training, only 14 of the 47 positions have been filled as of 2024. Why is that?

[Karen Hogan]

I might ask Nick to add some detail to that.

[Nicholas Swales, Principal, Office of the Auditor General]

I think the point we're making is that implementation has been slow. Part of the reason is that some of the plans had not been fully laid out, so implementation hasn't been advancing at the pace that the plan originally envisaged. That's the main issue in those particular spheres where there were supposed to be a number of positions already filled.

[Jeremy Patzer, Conservative, Swift Current—Grasslands—Kindersley, SK]

If the plan has not been fully implemented, why has it not?

In the report, I know that you talk about a lack of information back in 2022, but what did you find when you audited this that would have prevented them from getting there? The F-35 has been around for more than 20 years, so how did they not have complete information, and why is a lack of information part of what we're seeing as their reason for not being far enough advanced?

[Karen Hogan]

I'll see if Nick does want to add something, but I think your question is bringing in a whole bunch of our findings.

There was information that they didn't use. They used outdated information, which is part of the reason they're a little late. We found that there were a lot of plans that were incomplete, and there was slow progress.

I hope that our audit in October on recruitment might shed some light on progress and weaknesses in recruiting, but logistics and security positions are some of the areas they need to plan to recruit for. I think there's a lot to figure out here in why they've been making slow progress.

I don't know if you want to add at all, Nick.

[Jeremy Patzer, Conservative, Swift Current—Grasslands—Kindersley, SK]

I want to jump in right there.

In your report, you say there are 246 permanent positions required. In the report, there are 10 bases that are on the map. I know most of the report is based on Bagotville and Cold Lake. It seems to me that 246 permanent staff for those 10 bases would be a massive understaffing of what would be required for the F-35 program. I'm not an expert, but are the 246 positions just for the first two bases, or is that for all 10 bases? What is that for?

[Nicholas Swales]

Mr. Chair, perhaps I can help to explain that.

One of the observations we make is that the process of implementing the F-35 transition is in its early stages, and the plans haven't been fully drafted. This was one area where there was a plan that had laid out how many positions they actually needed in specific areas. We specify that it was for mission planning and some types of logistics and security. That is not the entire need for the F-35 program on all those bases. That was simply those areas where they had actually identified a number of positions by a certain time period, and only a small number of those had so far been filled.

For the rest, there wasn't that level of detail in the plans yet.

[Jeremy Patzer, Conservative, Swift Current—Grasslands—Kindersley, SK]

Why is that level of detail not in the plans yet? I guess that's kind of what I'm trying to get at here. This has been ongoing for years, yet we still have an incomplete plan. Why is that? Who's responsible for this? Do you have a name for who hasn't completed the planning for this? It is kind of crazy that we don't have a complete plan yet.

[Karen Hogan]

Mr. Chair, I think I would send the member to exhibit 2.2. We outlined the five phases of transitioning from the CF-18s to the CF-35s, and they're still in phase 1. The buildup phase is coming. This is National Defence's plan.

Ultimately, who is responsible? The chief of the defence staff and the deputy minister are, ultimately. Making sure that Canada's fighter jet capability is available and can transition is their ultimate responsibility. I think those are the questions that should go to National Defence—questions about progress, about the gaps in their plans and about how they plan on updating them.

We did give them a recommendation about making sure that their master plan was much more comprehensive.

[The Chair, Conservative, Kelly McCauley]

Thank you Mr. Patzer.

Ms. Rochefort, go ahead, please, for five minutes.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Good morning, Ms. Hogan.

Mr. Chair, is it for five minutes or six?

[The Chair, Conservative, Kelly McCauley]

You have five minutes.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Thank you.

Thank you for highlighting the fact that Public Services and Procurement Canada was provided funding in 2024-25. Basically, if I understand correctly from your report, there's a first tranche of 37 tenants, representing 90% of the office space, who were asked to begin reducing their office space in June 2024, so that's just about a year. Of those, you said that 15 of them had not yet signed an office space reduction agreement and that negotiations were still ongoing at the time of the audit.

Is that normal? How would you characterize the fact that not all of the 37 tenants representing such a major component of the office space had not yet signed an agreement? Could you share the names of those tenants?

[Karen Hogan]

I don't know the names of all 15. We would have to look into our files and see if we could get back to the committee.

I do believe that you could ask Public Services and Procurement Canada. That is the best way to get the most accurate information. Ours was from the point in time when we did the audit, which was several months ago, and I would hope that there would be progress. My advice would be to get that information from them.

Why had 15 out of the 37 not yet signed agreements? We heard a few things. One, as I mentioned earlier, was about the uncertainty around the return-to-office mandate and whether they would need more space than what they anticipated they could occupy. Some said that the space was needed to properly deliver on their mandate.

Another would be perhaps the lack of a financial incentive. Many federal organizations do not pay rent. We occupy space that Public Services and Procurement Canada has; for example, my office doesn't pay rent. It then becomes the will of the deputy minister to put up their hand. I have, and I have offered to reduce the space in Ottawa by almost 50%, even though I don't have a financial incentive. That might also be part of the reason that certain departments are not putting this on their priority list.

[Pauline Rochefort, Liberal, Nipissing—Timiskaming, ON]

Would “uncertainty” be correct?

[Karen Hogan]

It's uncertainty, and there are really so many things to focus efforts on. This isn't something that's costing you something, but it is costing the bigger, broader federal government. I think every department should look at how they can contribute to meeting this goal.