Evidence of meeting #20 for Natural Resources in the 45th Parliament, 1st session. (The original version is on Parliament’s site, as are the minutes.) The winning word was contract.
A video is available from Parliament.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
So, the ownership of shares in that company is the perceived.... A remedy would be for him to divest his shares. Would that make this go away, then?
Professor, Royal Military College of Canada and Queen's University, As an Individual
We have commissioners and agents of Parliament who are tasked with ensuring that those divestments are done in a way that is compliant with policy and procedure, so it is not for me to comment. However, I think we need to be much more rigorous in this country in avoiding the perception of conflict of interest. It is great that we can attract talent, such as the current Prime Minister, as members of Parliament, but then that talent also needs to make sure that they avoid any such perception of a conflict of interest, because that will undermine precisely the independence that we expect of our executive.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
You talked about the executives at AECL and Canadian Nuclear Labs. We hear that some of these managers are making over half a million dollars per year. Is that accurate?
Professor, Royal Military College of Canada and Queen's University, As an Individual
I skipped that part, out of respect for the chair of the committee, in order to stick to my five minutes here, but look, a 2025 ATIP shows that nine AECL executives earned $722,000 per year, including travel. Most were not Canadian. By fiscal 2023-24, AECL's 11 senior executives averaged over half a million dollars each, and 28 senior contractors—of which I believe 27 were American, but I would need to check in the ATIP—earned $377,275 per year. That is more than the annual salary of the Prime Minister.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
I'm sorry. Let's back this up. I didn't realize that these are Americans. Americans at AECL are making.... Who's paying for them, then?
Professor, Royal Military College of Canada and Queen's University, As an Individual
The ATIP is linked to my opening statement, so you'll be able to refer to the ATIP for the details.
Conservative
Corey Tochor Conservative Saskatoon—University, SK
Just to summarize, is this good value for money right now, these large salaries that are going to Americans?
Professor, Royal Military College of Canada and Queen's University, As an Individual
Without an independent assessment by a third party, we will never be able to tell.
Liberal
Liberal
Corey Hogan Liberal Calgary Confederation, AB
Thank you very much.
Thank you both for being here. I really appreciate your comments.
I have two lines of questioning. I'm going to throw them both on the table, and then I'm just going to jump into them.
The first is the overall GOCO model, which you were talking about. It was brought in by the Harper government, and it seemed, when we were discussing it last time, to be a pretty reasonable way to get American expertise. It was described to us that one of the goals was to access American expertise and make sure that we were able to benefit from it as Canadians.
I want to explore that, but I also want to throw on the table that, in terms of the security risk, it does feel like we'll need to reconcile, as a committee and as a government, how we feel about the United States in this matter. It's personally hard for me to imagine that the United States would not know details about modular reactors in the north under our current security regime. It seems actually impossible to me. I'm not passing moral judgment on whether that's good or bad, but that's something, certainly, that needs to be reconciled as we think about the overall trajectory of this country and the way security relationships are evolving.
I guess my question for you, Mr. Leuprecht, is this: What is your sense of the testimony we heard about the GOCO model being used to access private expertise—the original policy intent of the Harper government? How much does it align with that intent, and has it provided some value in that sense? If you want, you can just expand on your comments in that space.
Professor, Royal Military College of Canada and Queen's University, As an Individual
All I'm suggesting is that when we have a single bidder, one that is entirely American, that is not an opportunity for either AECL, the board or the minister to assess the best opportunities that are out there for Canada to maximize its interests in the current environment. I would urge the committee to look at the way that bid was structured. Having only a single bidder with no real Canadian content should have been a red flag in terms of competitiveness. We have a lot of expertise in allied and partner countries. Look at Japan; look at several European countries. Also, of course, as part of the previous consortium, we had Canadian content in AtkinsRéalis. There might be an interesting question about why that was not part of it.
I would also say that, yes, the U.S. would already have access to those SMR details. If you look at the scientific advisory board, which cost taxpayers $184,000 in 2022, I believe—it's linked in my remarks—for five individuals.... First, I mean, I work at a university. There is no advisory board that I know of at a Canadian university that costs $185,000 per year for, I believe, five individuals. I think there are some interesting questions.
Second, one of the members of that advisory board has close ties to the U.S. security and intelligence establishment. If we want to give away all of our intellectual property and make sure that the Americans know everything we're doing, then we might as well put the security and intelligence establishment right on our scientific advisory board.
Liberal
Corey Hogan Liberal Calgary Confederation, AB
We'll get back to that, because I do want to talk about the security conversations.
You said in your comments that CNL decides who controls IP. Can you expand on what you meant by that?
Professor, Royal Military College of Canada and Queen's University, As an Individual
I think the IP conversation is a longer conversation, and I'm happy to refer you to some excellent material on this. Senator Deacon was also involved in that conversation. He might have some interesting things to say to this committee on that.
In this country, we are demonstrably not very good in the way we write our IP contracts. As a result, we are effectively giving away free IP and our research and development to the United States and to Japan—
Professor, Royal Military College of Canada and Queen's University, As an Individual
—and, of course, we're having it stolen by China.
Liberal
Corey Hogan Liberal Calgary Confederation, AB
That is a topic: We need to strengthen IP.
In this specific case, when you said CNL decides who controls IP, I'm just trying to understand exactly what was meant by that.
Professor, Royal Military College of Canada and Queen's University, As an Individual
There's strategic direction in terms of what IP you're going to develop. Then there's the question about how you are going to protect that IP—how you are going to protect the knowledge component of the IP and how you are going to protect that IP being used by allies and by partners.
Liberal
Corey Hogan Liberal Calgary Confederation, AB
Right.
Again, I'm sorry, and I'm not trying to badger this point, but my understanding was that under the AECL contracts, the IP was maintained and controlled by Canadians.
If we're going to dig into this, I need to understand specifically what was meant by CNL controlling IP.
Professor, Royal Military College of Canada and Queen's University, As an Individual
I think CNL and AECL should be testifying to the details of that.
As I pointed out, I can only conjecture. From what I know about cybersecurity.... As a co-director of the cybersecurity program at RMC, which trains some of our highest-skilled operators in this country, I have some confidence and some understanding of cybersecurity and cybersecurity regulations, and those are nowhere near stringent enough. In information management, we simply do not have the regulations, the legislation and the rigour in place generally for our critical infrastructure, from which I infer that we are not imposing sufficient conditions on this contract, and that we cannot take the AECL executive at their word when they say, “Don't worry; there's nothing to see here.”
Liberal
Corey Hogan Liberal Calgary Confederation, AB
This would be more about the risk of theft than about policy control.
Professor, Royal Military College of Canada and Queen's University, As an Individual
No. It is the risk of inadvertence in the way we write our contracts. Because we are not rigorous in the way we write our contracts, our allies and partners are benefiting from the IP that the Canadian taxpayers invest in. We are effectively giving it away for free, because we are so not careful about how we write that.
Then there's the broader risk of it leaking out beyond the rigorous controls that we would need to put in place in a safe—
Liberal
The Chair Liberal Terry Duguid
Thank you, both.
We are now going to move on to Mr. Simard.
You have six minutes.