Thank you very much, Chair.
Welcome to both ministers. It's good to see you again here at committee.
I will jump right in.
On page 107 of the supplementary estimates (B) under the transfers section--and I believe, Minister, you may even have touched on this in your opening remarks--there's a reallocation of resources of $46 million. The $46 million is taken from vote 5, which is for capital expenditures reallocated to vote 1, which is for operating requirements. Page 108 says that $28 million of the $46 million is used for the marine security operations centre, which is an operational requirement.
If the other $17 million comes from reprofiling of capital projects, where is that $17 million exactly? What capital projects are not being funded as a result of the money being transferred from a capital fund to an operating fund? Specifically, was any of the capital money that's being delayed or diverted scheduled to go into any base maintenance or base infrastructure? Is it being diverted because there are medium- or longer-term plans to close bases, and so why bother doing short-term capital investments if, in the medium or long term, you're planning to close them? That would be my specific question.
Then also on this matter, if you're having to transfer this money from capital to operating expenditures, that suggests that you don't have enough operating funds. What are you going to do going forward when it's likely that you're going to have less money to work with? Where are you going to find the funding for those operational matters going forward?
Also, if I may, on the matter of lapsing funds, $2.4 billion was lapsed. The department is allowed to carry over 1%. You're carrying over 12%, and 11% of that is going to be lost, because you can keep only 1%. That's the highest amount any department has been allowed to lapse. I want to bring to the attention of the ministers that in the 2009 Auditor General report, this very matter was raised, and the Auditor General at the time, Madam Fraser, said this:
The Department's financial management and monitoring of resources may not be adequate to support decision making by senior management. The lack of accurate and timely information for decision makers contributed to the lapsing of more than $300 million in funding that was available during the 2007-08 fiscal year but is now permanently unavailable to Nation Defence.
Madam Fraser further pointed out that in the year 2007-08, it was $500 million, and she went on to say that was a significant amount. The department said they had agreed with the Auditor General's concerns and would take action. There was a list of things they would do, and now we find we have a number that's multiple times higher than the figure named by the Auditor General, so it's getting worse.
I'd like the witnesses to address why an issue that was previously identified by the Auditor General is getting worse, particularly an issue the department responded was going to be fixed. Clearly they didn't: it's getting worse.
In case I do not get the floor again--because I know how this works--I was hoping that the ministers or other witnesses could show me where the $477 million is for the new clandestine satellite system, as well as the $623 million that's going to be required for the shiny new headquarters.