Public Accounts Committee on April 3rd, 2008

[The Chair, Liberal, Shawn Murphy]

I'd like to call the meeting to order at this time. Bienvenue à tous.

Colleagues, this meeting is a continuation of the meetings that we're having pursuant to Standing Order 108(3)(g) on chapter 7, “Acquisition of Leased Office Space”, of the May 2006 Report of the Auditor General of Canada, referred to the committee back on May 16, 2006. Specifically this involves the renewal of the lease of the Place Victoria premises in the city of Montreal.

We have with us this morning from eleven to twelve via telephone conference Mr. Jean-Marc Bard. Then from twelve to one we have the Honourable Don Boudria, former Minister of Public Works and Government Services, and the Honourable Claude Drouin, the former Minister of Quebec Regional Development.

First of all I want to welcome you, Monsieur Bard. Bienvenue.

Before we start, there is a bit of a problem. Can you hear me okay?

[Jean-Marc Bard, As an Individual]

Yes, definitely.

[The Chair, Liberal, Shawn Murphy]

We have a bit of a problem with the actual video. You're not centred right, and you have to move.

Thank you very much.

You can hear me, and hopefully the translation will work. Mr. Bard, do you need translation?

[Jean-Marc Bard]

Not really, but I don't think I have the mechanism to receive the translation. I don't have an earphone, but it's okay.

[The Chair, Liberal, Shawn Murphy]

It will go in whatever language you want. You can tell us.

Thank you very much for joining us. How is the weather in Florida?

[Jean-Marc Bard]

Nice as usual.

[The Chair, Liberal, Shawn Murphy]

That's good.

Mr. Bard, do you have any opening remarks or comments for the committee?

[Jean-Marc Bard]

No, sir.

[The Chair, Liberal, Shawn Murphy]

Thank you very much.

Having said that, colleagues, we're going to go one round of eight minutes each. For the Liberals and Conservatives, if you want to share your eight minutes, please do so, because there are only going to be two Conservatives and two Liberals on this round, and of course that will end it insofar as Mr. Bard is concerned. We don't necessarily have to use all the time, but that is the maximum time that we have.

[David Christopherson, NDP, Hamilton Centre, ON]

I'm sorry, did you say two Conservatives, two Liberals, one NDP and one Bloc?

[The Chair, Liberal, Shawn Murphy]

Yes, for eight minutes, Mr. Christopherson. There's no second round vis-à-vis Mr. Bard.

We're going to start the first round of eight minutes.

Mr. Hubbard, the floor is yours.

[Charles Hubbard, Liberal, Miramichi, NB]

I think it will be Borys.

[The Chair, Liberal, Shawn Murphy]

Mr. Wrzesnewskyj, the floor is yours.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

Thank you, Chair.

Mr. Bard, I assume you've had a chance to read through the Auditor General's report. This series of meetings stems from a single exhibit, exhibit 7.2, from that Auditor General report. I assume you've looked at exhibit 7.2 and the conclusions that the Auditor General had made.

[Jean-Marc Bard]

No, I didn't, because I didn't get the Auditor General's report. I got a big pile of documents, I would say about three or four inches thick, but the Auditor General's report wasn't in it. I have read most of the important testimony, and I've read the internal correspondence that was forwarded to me, and that is it.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

That's a little surprising, that you wouldn't have seen the actual exhibit that has triggered a series of meetings and you're appearing before the committee today.

Let me tell you what the Auditor General's exhibit 7.2 states. It says that

The Agency's request not to move, combined with the lack of adherence to established guidelines, has cost taxpayers an additional $4.6 million.

Unfortunately, it's almost like a throw-in exhibit. It didn't provide any of the documentation to explain how the Auditor General arrived at that number of $4.6 million. We've since found those numbers unfortunately misleading because they're based on a fictitious gross rental rate of $430, which was the number initially in the tender, but the actual number was $308.

In your two or three inches of documents, do you have the table of the original tender?

[Jean-Marc Bard]

I have the table of the chronological events, but this is all I have. It's the first few pages, and it's called “Process/Chronology of Events Place Victoria”.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

I see. In that case, I guess I'll have to go through some of the facts and numbers we've established in past meetings.

The basic operating cost per metre at Place Victoria compared to Bonaventure was about half the amount. So it made a $50 difference to the advantage of using Place Victoria. When that gets factored in, along with the actual—not the fictitious but the actual—amount of the rent, we established the cost was in fact $120,000, to a total of $600,000 over the five-year period.

Then we heard from Mr. Gladu and Mr. Drouin in their testimony before us that it would cost approximately $1 million just for the actual move. Do you concur with that particular number, that it could have cost up to $1 million to move?

[Jean-Marc Bard]

Sir, it's very hard for me to say. If I can recap very shortly, Minister Gagliano left his post as minister on January 15, 2002, so up to that date I can answer your questions.

As far as the figures are concerned, in the minister's office we were far from being experts at analyzing what the civil service did, particularly the real property service within the department. When we left the department, I don't think they were that far up. Nothing was concluded with either Place Bonaventure or Place Victoria, so it's very hard for me to pronounce myself and state that I agree or disagree with the numbers referred to by you and also by the Auditor General.

[Borys Wrzesnewskyj, Liberal, Etobicoke Centre, ON]

Thank you.

There are two components to the concerns that have been raised in the committee. One was that taxpayers' dollars were not properly used and there was an additional cost to taxpayers. The Auditor General used a figure of $4.6 million. We've now realized that the numbers that that was based on were not the actual numbers of the cost; they were based on a previous tender and in fact were—

[David Sweet, Conservative, Ancaster—Dundas—Flamborough—Westdale, ON]

Point of order, Mr. Chairman.

One of the agents of Parliament who we rely on a lot is the Auditor General, and this is a repeated inference by Mr. Wrzesnewskyj that the figures were wrong. I know that the Auditor General's office is not far from here. I wonder if the clerk could summon someone from the Auditor General's office who is familiar with this file, because they have already reconfirmed that they stand behind their figures.

[The Chair, Liberal, Shawn Murphy]

No, I'm not going to do that. That's a question of debate, Mr. Sweet. The issue has been going on for some time now, and it's difficult to say who's right and who's wrong.

It's a dispute between the Department of Public Works and Government Services and the Office of the Auditor General. There's no question, my own view was the Office of the Auditor General was right when it wrote the report. Public Works is stating that subsequent to that there's new and additional information, mainly renting of the premises at Place Bonaventure that lessened the amount referred to in the Auditor General's report. I'm not exactly sure. I'm going to ask the analyst to comment. He's following it much closer than I am.

Do you have any comment on that particular issue? There's no point in bringing in the Auditor General.

[Alex Smith, Committee Researcher]

All I would add is that the committee hasn't received any documentation to support the analysis from Public Works.

[The Chair, Liberal, Shawn Murphy]

Mr. Fitzpatrick.

[Brian Fitzpatrick, Conservative, Prince Albert, SK]

I am concerned that an Auditor General representative is not here and there has been terminology like “misleading” and “fictitious”. A whole area that hasn't been explored here is all the costs of relocating other agencies to get them into Bonaventure. It's $1 million to get across the street from Place Victoria to Bonaventure, so the facts are that to bring bureaucrats into the Bonaventure, which is an empty building, from other offices would cost millions too.

This is a lot of speculation going on regarding people. For people to allege that this is misleading or fictitious, I really take offence to that. That's a reason why the Auditor General should be here, I think, when we have these hearings.