Procedure and House Affairs Committee on March 16th, 2011

[Alister Smith]

Exactly. Those costs can evolve, and of course the bill can be amended and there can be other changes before it becomes law.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

Right. Okay.

When you get a bill that is reintroduced from one Parliament to the next, does it get re-costed? In asking this question, the bill that comes to my mind--although it's not one that's under consideration here, it's just one that I've followed with interest--is Bill C-6, an act respecting the safety of consumer products, which came back as Bill C-36. I think I have it backwards. It started off as Bill C-36 and wound up as Bill C-6. But at any rate, for a bill like that, would there be a re-costing that would go on?

[Alister Smith]

I think there is continual refinement of costing. I'm not sure about that particular bill. It could be that there were changes introduced in the policy and the approach and that may have affected the costing or re-costing when the bill was reintroduced. I presume there would have been some changes from the initial bill to the bill that was reintroduced and that would have affected the costs.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

Right. I just pulled that one out of thin air, so perhaps that's not fair. You didn't come prepared to comment on that bill.

Private members' bills, as you know, unless they receive a royal recommendation, which never happens, cannot, under....

I'm sorry, Mr. Proulx is correcting me. But it doesn't happen in the normal course.

At any rate, they are required to be items that would not impose costs on the federal government. Are there ever bills that originate with the ministry that have no costs associated with them?

[Alister Smith]

Certainly. And some of these bills, as you mentioned, do not have easily identifiable costs.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

That would be true of some of the 18 bills that Mr. Brison referred to in his original motion?

[Alister Smith]

That's my understanding, yes.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

Okay, thank you.

I think that's all I have to ask.

Thank you very much.

[The Chair, Conservative, Joe Preston]

You have two minutes left, sir.

[Scott Reid, Conservative, Lanark—Frontenac—Lennox and Addington, ON]

Actually, there might be another member who's interested in raising something.

[The Chair, Conservative, Joe Preston]

Mr. Albrecht.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Thank you, Mr. Chair.

I want to follow up on that, in terms of the estimates process, as those estimates come to committee. It's my understanding, at least, that all of the estimates from each department need to come to the appropriate committee. Can you just tell us a bit about what is the role of the individual MPs at that committee? Can they reduce the estimates based on what the committee decides? Can they increase them? What are the options that are open to committee members in terms of having control over the estimates process?

Earlier today, one of our colleagues was implying that some of these figures have not been public, and in fact they are in the estimates. I think it's incumbent upon MPs to do their homework and if they have questions to look at the estimates. But just help me through that process.

[Alister Smith]

Yes, committee members can recommend and the House can reduce estimates for particular items. They cannot increase the ask for funds, but they can reduce the amount of money that is provided for a particular purpose, for a particular vote.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

What is the typical cycle for that process? We see the main estimates and then we have supplementary estimates. Could you just enlighten the committee and the Canadians who may be watching this as to how that process works?

[Alister Smith]

Sure.

From policy initiatives we'd be talking about memoranda to cabinet. From policy initiatives we move to submissions to the Treasury Board. Once Treasury Board has made a decision on funding, all those funding decisions are compiled into the estimates, and they do affect the reference levels of departments. Those changes in reference levels, again, form part of the main estimates. The main estimates have just been tabled and provided to Parliament for approval, and once approved the funding is provided to departments. Departments also have to report back to Parliament on the results of the spending; they have to report on plans and on results.

[The Chair, Conservative, Joe Preston]

We'll put you down for the next round.

Monsieur Paquette.

[Pierre Paquette, Bloc, Joliette, QC]

Thank you, Mr. Chairman.

Mr. Reid asked you earlier what you mean by “high level cost”. You said that it was very approximate. Does that mean that once a costing process is underway, you opt for the most expensive scenario? Is that the case?

[Alister Smith]

Perhaps I can turn to my colleague on the principles we apply in costing and she can explain. We certainly don't go to the most costly alternative; that's not the way the costing is done. A set of principles are employed, and they do follow best practice.

Perhaps I can turn to Donna on that.

[Donna Dériger, Acting Senior Director, Financial Management Strategies, Costing and Charging, Financial Management Sector, Office of the Comptroller General, Treasury Board Secretariat]

A lot of professional judgment is required to be exercised during the estimation of costs. Whatever the accountants consider, in consultation with the program managers, who are the most knowledgeable about the program and the activities to be performed, they would arrive in concert at a reasonable cost estimate.

[Pierre Paquette, Bloc, Joliette, QC]

So, it is not a high level estimate.

[Alister Smith]

Perhaps I can explain what is meant by that.

Initially with any policy item, but particularly with a new bill, a lot of details need to be sorted out. So the first cost estimates are necessarily going to be high level. They're only going to take some factors into account. As more and more pieces of the puzzle fall into place, as the bill becomes law, as the initiatives under the bill become fleshed out, as you determine how many FTEs you need, as all those details become fleshed out, the costs become more precise. So from a high level to a more detailed level is really what I was trying to explain. We don't have all the details in the beginning. You do the best you can on the costs involved and then you end up with something that is very detailed for consideration for funding and for approval in Parliament as well.

[Pierre Paquette, Bloc, Joliette, QC]

You are trying to explain the fact that, as the process unfolds, the closer you get to implementing a government decision regarding a new piece of legislation or a new program, the more accurate is your estimate of the cost, which is perfectly normal.

Is it possible for a bill or program decision to be submitted to Cabinet without any prior costing? Because it's approximate, Cabinet might consider that it doesn't need to know the cost in order to make a decision.

[Alister Smith]

I think many considerations go into a cabinet decision as to a bill, cost being one of them. I think all members of any cabinet would want to know as much as they possibly could about the potential costs. That being said, it's sometimes very difficult to determine what those costs are. They're really highly contingent. So it may be very difficult for them to try to calibrate that cost, especially if it's many years out.

[Pierre Paquette, Bloc, Joliette, QC]

If Cabinet needs to know what bills or programs are going to cost, it is perfectly natural that, before making its decision, the House of Commons would also have access to that information, even though it may be approximate. That is part of the debate.

You are right to say that it is not the whole debate, but I would like to cite the example of employment insurance.

Every time we propose enhancements to employment insurance, the Conservative government says that it will be too expensive, and that option is completely ruled out. However, if we need information about costs in the context of parliamentary debate, it would also be perfectly normal for us, like Cabinet, to be given that information, even if the cost is approximate.

[Alister Smith]

I can't disagree that having cost information improves decision-making; it certainly does. You have the role of the standing committees, House debates; you have opportunities to ask for that information to decide whether you're going to vote for a bill or not.