Evidence of meeting #8 for Public Accounts in the 39th Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was space.
12:45 p.m.
Executive Director, Assets and Acquired Services Directorate, Government Operations Sector, Treasury Board of Canada Secretariat
The plan now is to use the same process we use for the O and M carry-forward, whereby it shows up in the appropriation of the following year. It's identified specifically as the carry-forward amount from the previous year.
12:45 p.m.
Conservative
John Williams Conservative Edmonton—St. Albert, AB
It's not recorded in the financial statements of the year prior.
12:45 p.m.
Executive Director, Assets and Acquired Services Directorate, Government Operations Sector, Treasury Board of Canada Secretariat
No, it wouldn't be.
12:45 p.m.
Conservative
John Williams Conservative Edmonton—St. Albert, AB
Mr. McGrath, you were giving me a long and convoluted answer to my simple question about why Public Works, which owns and leases space on behalf of other government departments, is not, in essence, subleasing out to the departments. I think your answer said if they take additional space, you charge additional rent, but you never answered the simple question of why you aren't charging a charge-out rate for all the space these departments are using, because we are on the accrual accounting basis now. So why aren't you doing it? I need a simple answer as to why you aren't doing it.
12:45 p.m.
Acting Assistant Deputy Minister, Real Property Branch, Department of Public Works and Government Services
We feel there's no added benefit in charging amongst government departments. We have a pilot with HRSDC on that program. It has not produced the types of results that you would expect to see from somebody with a user-pay regime.
12:45 p.m.
Conservative
John Williams Conservative Edmonton—St. Albert, AB
Mr. Chairman, I want to point out that they are telling us how they're reducing the square metres per staff member and they have these ratios, but they have no concept or capacity to determine dollar cost per employee and so on if they don't have this lease-out agreement. Every other private sector organization charges out to profit centres the space occupied by their departments. I don't know why the government won't do it either.
If you have a long and convoluted answer, you could perhaps table a response to us because I want to see it done.
12:45 p.m.
Deputy Minister, Department of Public Works and Government Services
Mr. Williams and Mr. Chairman, we operate under the accounting principles of the Government of Canada. If your recommendation is finally to investigate it and follow it up by the Comptroller General and we are instructed to do so, we'll be happy to do so.
12:45 p.m.
Conservative
John Williams Conservative Edmonton—St. Albert, AB
Thank you.
Now getting back to 800 Place Victoria in Montreal, you tell us about how the department didn't want to move, but you had been negotiating for two years. The lease expired in 2003. In 2001 you started the process to find out what you were going to do. Then two weeks after everything closes and you've incurred a liability with the new landlord, boom, somebody says, oh, I think I want to stay. Why wasn't that question about wanting to stay asked before? Who said they wanted to stay, and why wasn't that brought forward?
I'd like a quick answer, and I think you may have to table the correspondence regarding this.
12:45 p.m.
Deputy Minister, Department of Public Works and Government Services
I think we'll table the correspondence, which will be clear as to why people wanted to stay.
12:45 p.m.
Conservative
12:45 p.m.
Conservative
David Sweet Conservative Ancaster—Dundas—Flamborough—Westdale, ON
Yes, I have one quick question for Mr. McGrath to clear up a question that was given by my colleague across the way. Could you please specify whether the agreement in Hamilton, where you have a purchase option in 2008, is subject to the market value in 2008, or do you have a firm agreement on the purchase option?
12:45 p.m.
Acting Assistant Deputy Minister, Real Property Branch, Department of Public Works and Government Services
We have a firm agreement on the purchase option.
12:45 p.m.
Conservative
David Sweet Conservative Ancaster—Dundas—Flamborough—Westdale, ON
So you have a purchase price embedded in the contract. It won't fluctuate based on market conditions at all?
12:45 p.m.
Acting Assistant Deputy Minister, Real Property Branch, Department of Public Works and Government Services
That is correct.
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Conservative
12:45 p.m.
Liberal
The Chair Liberal Shawn Murphy
Thank you, Mr. Sweet.
I have a couple of questions, going back to you, Mr. Marshall. They again involve the JDS Uniphase space. You're in a difficult position because your minister doesn't come to the House and we're not able to ask your minister questions, although you do have a parliamentary secretary there.
It's my understanding that for this deal there was a letter of intent signed, and it was signed some time ago, I understand, Mr. McGrath.
12:45 p.m.
Acting Assistant Deputy Minister, Real Property Branch, Department of Public Works and Government Services
That is correct.
12:45 p.m.
Liberal
The Chair Liberal Shawn Murphy
I've seen a hundred of them. They are fairly extensive documents setting out the terms, the conditions, the space, the terms of the rent, and a number of conditions precedent dealing with regulatory approval, environmental audits, etc., and Treasury Board approval.
The parliamentary secretary was asked a question, and he was quite specific that there was no deal, no agreement between the Government of Canada and whoever the owner is. From your experience, Mr. Marshall, was that the true answer?
12:50 p.m.
Deputy Minister, Department of Public Works and Government Services
Mr. Chairman, I believe it was. The reason I can say that is that there is no deal until all the conditions precedent are met. We had the very same situation with the Department of National Defence, where we had signed a letter of intent with the owner explicitly stating that we had to get all these approvals done. They were not forthcoming; the deal was rescinded.
So there is no deal until it's approved and ministers have a chance to examine it and go over it.
12:50 p.m.
Liberal
The Chair Liberal Shawn Murphy
So that is the position. It rather relates to the next hour, because if there's no Treasury Board approval, there is no contract, no deal, and no agreement.
12:50 p.m.
Deputy Minister, Department of Public Works and Government Services
That is correct.
12:50 p.m.
Liberal
The Chair Liberal Shawn Murphy
My last question, again on the same issue, is this. There has been an allegation floating around Ottawa that Freddy Doucet, who is a lobbyist from the Mulroney era, has resurfaced in Ottawa, and his job is to grease the wheels on this particular deal. I don't understand how this murky world of lobbyists works. Would Mr. Doucet meet with you, Mr. Marshall, or with you, Mr. McGrath, or with anyone involved in this particular transaction?
12:50 p.m.
Deputy Minister, Department of Public Works and Government Services
Mr. Chairman, I don't know Mr. Doucet; he has never met with me. He certainly did not meet with our department prior to the letter of intent being signed. The letter of intent was signed January 10—
12:50 p.m.
Liberal