Indigenous and Northern Affairs Committee on Nov. 19th, 2018

[Glenn Campbell]

The more macro issue of housing is certainly occupying a lot of time among officials. Canada Mortgage and Housing Corporation is spending a lot of time as the vehicle to look at that issue. In their engagement with the private sector, they are looking at infrastructure development. Regardless of the tools they use, particularly in the north, they're thinking a lot about their workforce.

In the projects I just toured up in Kivalliq, they spent a lot of time thinking about how to employ the regional workforce, how to get them to and from home so that culture shock caused by how long they were away did not affect their ability to participate. Modular housing was something they could bring in and remove if the mine ever closed so that there would be no legacy environmental impact. I can say that I was quite impressed with how much they were thinking about how to get people in, how to get them out, how to get them living closer to the infrastructure asset they're building. I think they're encouraged to make that part of the overall business case.

[Rachel Blaney, NDP, North Island—Powell River, BC]

Thank you.

Mr. Lavallée, one of the things you talked about in your report to us was looking at supporting individual projects that were too small to attract private capital by bundling them together with CIB support and how that might attract investment. I'm wondering if you have any examples of bundling together projects that you're undertaking or looking at right now.

[Pierre Lavallée]

We haven't announced an investment in that area yet, but I can give you a couple of examples that would normally fall below the scale threshold. It's not that they're not important to the communities; it's just that they fall below the scale threshold for private investors. That would be in water and wastewater treatment or in distributed power generation and microgrids. Both of those areas we think have some potential in terms of bundling them, aggregating them—I'm not sure exactly what the right word is, but I think you get the image—that will make them attractive for private investors.

[Rachel Blaney, NDP, North Island—Powell River, BC]

Thank you.

My last question is to Mr. Campbell. I understand that the Canada Infrastructure Bank is now in place, and PPP Canada, the Crown corporation, is being closed. Can you tell me the difference between those two Crown corporations?

[Glenn Campbell]

PPP Canada was a Crown corporation engaged in supporting public-private partnerships that were availability-based procurement models. That's when you're working with a jurisdiction and using the contract model of how projects are designed, built, financed, operated and maintained. It's a traditional procurement model that largely involves governments being the funders of all of that asset, and it's related to the amount of taxpayer support over a period of time. There are benefits to that model in construction, design, operation and maintenance. After 10 years, that model has now become prevalent across the country. Many provinces have now created their own agencies. It's embedded. Even federally, many of our own departments are using their own P3 models.

The federal government decided that it need not be in that space. Former elements of PPP Canada are now at Infrastructure Canada—the P3 Canada Fund, all those projects—

[The Chair, Liberal, MaryAnn Mihychuk]

Thank you.

[Glenn Campbell]

—and a lot of those employees have been brought in.

Pardon me, Madam Chair.

[The Chair, Liberal, MaryAnn Mihychuk]

I know there's a lot to talk about on this issue.

The questioning now goes to MP Robillard.

[Yves Robillard, Marc-Aurèle-Fortin, Lib.]

Thank you, Madam Chair.

I thank the witnesses for their excellent testimony, and for the excellent French translations of their texts.

My questions will be in French, of course. The first one is for Mr. Campbell.

What long-term strategy should the federal government adopt to correct the problems related to the infrastructure deficit, which is hindering development in the Arctic?

[Glenn Campbell]

From the government's point of view, the Investing in Canada plan recognizes that nationally and in various regions there is an infrastructure deficit. The government has put forward a 12-year plan with a lot of money as part of $186 billion allocated by province, by theme, by territory, putting more money on the table for local decisions to be made about how best to fill that gap.

The government has put in what it believes is a sizable amount, tripling it over 10 years and using various tools to bring as much as it can of that infrastructure gap to a close. It recognizes, however, that it's an unsustainable burden on the taxpayer to fill all of that gap. That's why the government has been employing both P3 models and Canada Infrastructure Bank models to see if we can, where appropriate, bring in the private sector to help fill that infrastructure gap, whether it's south of 60, north of 60 in the Arctic, or anywhere in Canada, frankly.

[Yves Robillard]

Thank you, Mr. Campbell.

My next question is for Mr. Lavallée.

Does the Canada Infrastructure Bank have an Arctic-specific or indigenous-focused team?

[Pierre Lavallée]

Today, the bank's team is always growing and learning. Since it is very small, we have not divided it up according to files, but rather according to projects.

I alluded to the number of projects of interest in the North and remote areas. Our teams are busy with a combination of projects of that type established in the North, and on other projects, but the teams are not divided up and do not have different mandates. This allows us to be more flexible and to allocate resources to projects of interest, rather than having certain teams with fewer projects to accomplish, teams that would be less busy while others would be overwhelmed. Dividing up the tasks per project according to the availability of our teams allows us to react more quickly.

[Yves Robillard]

How will the organization prioritize investments in the Arctic to meet the needs of communities?

[Pierre Lavallée]

Over the years, we will seek to fully understand local, regional, provincial and territorial priorities in order to guide our activities and align them with the governments' priorities at all levels. It is not up to the bank in its wisdom to determine and impose what Canada or a given region needs. We are trying to establish the opposite approach.

[Yves Robillard]

What sources of revenue does the Government of Canada expect to accrue from the bank? Will revenues be passed along to citizens or the private sector? Are there any points you did not have time to mention in your testimony?

[Pierre Lavallée]

The revenues accrued by the bank, for instance interests on loans the bank invested in, will return to general government revenue. It will then be up to the government to decide whether it wants to return that capital to the bank or direct it to other programs.

[Yves Robillard]

Would you like to add anything you forgot to mention earlier?

[Pierre Lavallée]

Regarding revenue, specifically?

[Yves Robillard]

Yes.

[Pierre Lavallée]

I want to make sure I've properly delineated the various concepts.

There is revenue attached to infrastructure projects, which will be used to fund the projects themselves. Part of this funding will return to the bank. That is a different revenue concept. The bank's revenues will come from the return on investments we've made, rather than direct income to the bank from users' fees, for example. We are not directly connected to that revenue at the source.

[Yves Robillard]

Thank you.

[The Chair, Liberal, MaryAnn Mihychuk]

I have a question to both groups. In the case that the territorial or provincial government does not have the will or ability to participate in an infrastructure project—for example, a road—could the community work with the private sector without the territory or province and access federal money?

[Glenn Campbell]

In the first instance, we would anticipate that the community would prioritize a lot of infrastructure and then determine where it can allocate their resources. In many of those cases, they will be contributing to projects even if the bank comes forward.

In certain circumstances, if the local communities are the public sponsor and are part of that entity, they can work with the private sponsor and come forward to the bank under an unsolicited proposal channel, or a community could go forward to the territory or province as a municipality, or some other form of government, to put forward that project. Both the bank and the government would look at it and determine whether that project is in the public interest. Is there a public sponsor somehow attached to the project that differentiates it from a private sponsor?

All projects need not have both territorial and municipal sponsors. It could be an indigenous government in a community coming forward with a project, either with private sector players or on their own, to interface with a number of these programs that are in play.

[The Chair, Liberal, MaryAnn Mihychuk]

Questioning now goes to MP Jeneroux.

[Matt Jeneroux]

Thank you, Madam Chair.

The last minister was in place when you were hired, Mr. Lavallée. He was then unceremoniously turfed because, quite frankly, he couldn't get infrastructure spending out the door. The Prime Minister said it himself in the mandate letter. There's now a new minister in charge, saying many of the same things that the last minister said. You told us that you have 10 projects that you're excited about with the Infrastructure Bank, but yet you can't tell us what any of those projects are. Why can't you tell us?