Public Accounts Committee on May 1st, 2008

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

Right now, what I see with your office, from all the questioning and from what I've seen in written text and so on, is that oversight, forecasting, and parliamentary capacity is the main crux of the mandate of your office. And really, to a degree, Mr. Young, is that an expansion of...? You have 30 economists there right now. Maybe there wasn't the oversight, but was the forecasting and parliamentary capacity already there, to a degree?

[William R. Young]

The forecasting is new. The library has not really had any capacity previously to do any fiscal forecasting. The other elements of this mandate have been, to some extent, covered off by the parliamentary research branch, including the economists. I mean, you have two of them here who worked on some of the elements that are included in this mandate.

My concern has always been that the Parliamentary Budget Officer add additional value to the work that has been conducted. From my perspective, it's going to add a strategic capacity to the library's ability to serve Parliament and parliamentarians that may not have been there before.

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

Thank you. I hope you didn't think I was trying to short-sell the position; I was trying to clarify for people who read the blues later, etc.

One of the issues that has been around for a long time is moving the federal public service to full accrual accounting. We've had some meetings over the past summer and into the spring in terms of trying to get some commitments from Treasury Board about moving that way. The Auditor General was reluctant to give us some recommendations after the Treasury Board made their presentation to us. I understand that, because the nature of her office is audit.

Is that something your office could look at? When the government comes with a proposal about changing to full accrual accounting, could you make some recommendations, based on what you see, about any changes that would have to be made?

[Kevin Page]

Sir, we would be happy to be put in that position to make recommendations. We would be making recommendations based on what are the best practices in other countries, in other public sectors, and in the private sector as well.

On the issue of accrual accounting, we've made some progress already in terms of moving the public accounts to an accrual basis and our budgets to an accrual basis. The next step, which you're alluding to, is to look at issues around accrual estimates. Again, in the context of best practices, there are countries--the U.K., Australia, New Zealand--who are providing accrual estimates right now.

To come back to your question, yes, we would be happy to provide recommendations based on best practices.

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

Very good.

I was also glad to hear you mention that no one has a crystal ball, because I think one thing you can add--please correct me if I'm wrong—is a higher level of scrutiny and of course an objective level of forecasting outside of government.

Really, your budget officer is going to be subject to every changing fluctuation in the economy that any other person with substantial credentials is going to find themselves in as well, particularly with the radical softening we see. Everybody knew it was going to soften, but the credit situation really put that into a warp factor of about five.

Your forecasting is going to be subject to all the same limitations as the twenty institutions the federal government now looks at currently, right?

[Kevin Page]

That's correct, sir.

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

I have a last question. You mentioned the phases--the capacity-building phase, the implementation phase, the service phase. I'm not suggesting that I'm going to hold you to an exact month and time of day, but do you have any idea of when your office will be at full capacity?

[Kevin Page]

We had a 33% increase in manpower this week. We'll have a 25% increase on Monday. We hope to be something like 60% to 75% staffed up by the early fall.

We realize we have an opportunity in the months of May and June because we have some availability of you folks--we'd like to take advantage of that--but we don't think the consultation phase will ever end. As part of our planning processes, we'll look at setting up a review plan as well in terms of coming back in a year, or two or three years, on whether or not we are meeting your priorities.

In terms of services and products, sir, we are looking towards the fall.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Mr. Sweet.

Monsieur Laforest, une petite question.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

Thank you, Mr. Chairman.

A very short question. During the consultations held before your appointment, we had asked if the position would be filled by a bilingual person. We had also asked if the senior assistants would also be bilingual.

Mr. Khan, can you tell us if you are bilingual and what will be your main responsibilities?

[Sahir Khan, Director of Expenditure, Revenue Analysis, Library of Parliament]

Thank you for your question, Mr. Laforest. I started in a French immersion program at the age of six. I can work in French. My main responsibility will be to provide analysis and advice on government expenditures, on major projects and on the budget, and to establish a link with the economic situation in order to know how this could influence budget planning and Parliamentarians' choices.

[Jean-Yves Laforest, Bloc, Saint-Maurice—Champlain, QC]

I am very happy to hear that. Thank you very much.

[The Chair, Liberal, Shawn Murphy]

Thank you.

I have one quick question before we break.

Mr. Page, I take it a lot of your work, or some of it, will be on the estimates. Do you envisage your role and the role of your office also linking the estimates with the expenditure and the performance, that whole area? I think it's very important.

[Kevin Page]

As you noted, sir, one of the three pillars of our mandate is to provide support in the form of additional scrutiny on issues concerning the estimates. I think making sure that our reports on plans and priorities and our departmental performance reports...that's a better linkage. I think governments in Canada and other countries have struggled with performance reporting. We have a lot of progress to make. We'll be putting pressure on departments in order to improve their performance reporting.

[The Chair, Liberal, Shawn Murphy]

Thank you very much.

Before we suspend, Mr. Page or Mr. Young, I'm going to give the floor to you if you have any closing or final remarks you want to address to the committee.

[Kevin Page]

Thank you for today. Again, it's an honour to be here and to serve you. I'm looking forward to it. It's exciting for me. It's an exciting part of my career, and I'm looking forward to the opportunity.

Thank you very much.

[The Chair, Liberal, Shawn Murphy]

A lot of witnesses don't consider it an honour, but it's good that you're thinking that.

Mr. Page and Mr. Khan, on behalf of everyone here on the committee, I want to first, again, congratulate you on your appointments. I want to thank you both and Mr. Young very much for being here today. We wish you all the best, and we're certainly looking forward to working with you and your office in the months and years to come.

Thank you very much.

Colleagues, we're going to suspend for two minutes to get set up with the interim Commissioner of the Environment and Sustainable Development.

[The Chair, Liberal, Shawn Murphy]

I would like to call the meeting to order.

I want to welcome everyone here.

Welcome.

Colleagues, this meeting deals with chapter 10, “Management Tools and Government Commitments—Greening of Government Operations”, of the March 2008 Report of the Auditor General of Canada.

We're very pleased to have with us today, from the Office of the Auditor General of Canada, Ron Thompson, interim Commissioner of the Environment and Sustainable Development. He is accompanied by Paul Morse, principal, sustainable development strategies, audits and studies; and Mr. David Willey, director, sustainable development strategies, audits, and studies.

We also have with us, from the Department of Public Works and Government Services, Daphne Meredith, associate deputy minister.

From the Department of the Environment, we have Ian Shugart, associate deputy minister. And from the Treasury Board Secretariat, we have Daniel Jean, associate secretary, and Michael Presley, executive director, regulatory affairs division.

On behalf of all committee members, I want to extend to everyone a very warm welcome.

I understand you have opening comments, Mr. Thompson, so I'm going to turn the floor over to you.

[Ron Thompson, Interim Commissioner of the Environment and Sustainable Development, Office of the Auditor General of Canada]

Thank you very much, Mr. Chairman.

I must say I'm delighted to be here to discuss chapter 10 of our 2008 status report, tabled in Parliament on March 6.

As you mentioned, joining me at the table is Paul Morse, principal responsible for this chapter, and David Willey, lead director of this work.

As the committee knows, status reports from the Office of the Auditor General of Canada show what the departments and agencies have done to address issues the office has raised in some of its past reports. In determining whether progress on an issue is satisfactory or unsatisfactory, the office takes into account the complexity of the issue and the amount of time that has passed since the original audit.

This is the first time that a Status Report has been tabled in Parliament by a Commissioner of the Environment and Sustainable Development. It deals with the government's management of environment and sustainable development issues.

Of the fourteen chapters in our Status Report, five show satisfactory progress. However, progress in nine areas is unsatisfactory--largely because the government did not follow through on commitments it made when responding to past environment and sustainable development audits.

The first three chapters deal with chemicals management, and we were pleased to report satisfactory progress. Chapters 4 through 7 focus on ecosystems, and we have rated progress as unsatisfactory. Chapters 8, 9 and 10 relate to management tools and, once again, we have rated progress as unsatisfactory. Chapters 11 to 14 look at actions taken in response to environmental petitions; for two of these audits we have reported satisfactory progress and for the other two, unsatisfactory progress.

I would like to now turn to chapter 10, which I understand the committee is particularly interested in. This chapter looks at selected aspects of how the government has gone about greening its operations. Our audit revealed that as Canada's largest employer, purchaser, and landowner, the government has a long way to go before it can claim to be a leader in this area. Although progress has been made in greening the government's new commodity management approach to procurement, guidance for departments to use in preparing their sustainable development strategies is weak.

These strategies are tabled in Parliament every three years by federal departments. They are intended to inform Parliament about the significant social, economic, and environmental impacts associated with the department's policies and programs and how each department plans to address them. The latest strategies were tabled in December of 2006 and the next round is due in December of 2009.

In conducting this audit, we examined guidance for building energy, vehicle fleet emissions, and green procurement, which were the priority areas agreed to by officials for the 2006 sustainable development strategies. We found that guidance was timid at best. Targets were not specific or mandatory, were open to interpretation, and reiterated previous objectives. Not surprisingly, the government is not in a position to know what progress is being made in greening its overall operations.

We point out that other countries have adopted quite a different approach. For example, in the United Kingdom and also in the United States, top-down direction on greening is given to government departments from the highest levels. We recommended that Public Works and Government Services Canada, PWGSC, in consultation with the Treasury Board of Canada Secretariat, Environment Canada, and others clarify leadership and responsibility for a number of things: for providing simple direction and guidance to departments on greening their operations; for establishing meaningful and aggressive government-wide targets; and for developing a government-wide strategy for monitoring and reporting results. PWGSC agreed with our recommendation.

Mr. Chairman, this hearing is particularly timely given that guidance for the December 2009 round of sustainable development strategies will likely need to be finalized over the next few months The Committee may wish to ask departmental officials about the progress they are making in clarifying leadership and responsibility issues; strengthening guidance for building energy, vehicle fleet emissions and green procurement; and expanding guidance to cover other areas, such as waste management.

PWGSC officials have provided us with an early draft of the Department's detailed action plan to implement our recommendations. We have provided comments to the Department on this draft and made a number of suggestions to strengthen it. Although we have not conducted an audit or a full review of the draft plan, I am pleased to say, Mr. Chairman, that our suggestions have been incorporated into the Department's final version.

I am hopeful that the interests of parliamentarians through committees such as this one, Mr. Chairman, will encourage the government to strengthen its management of environment and sustainable development issues and become a recognized model of how Canadian firms and individuals can and should green their operations and their day-to-day activities.

That concludes our opening statement. We would be very pleased to answer any questions the committee may have a bit later.

Thank you, Mr. Chairman.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Mr. Thompson.

Before we go to Ms. Meredith, I want to point out to members that normally in a meeting like this we would expect to have the deputy minister or the accounting officer of each of the departments. This meeting was scheduled on relatively short notice. Unfortunately, the accounting officers for Public Works and Government Services Canada and Environment Canada are out of Ottawa. They're unable to attend. But instead of rescheduling the meeting, the steering committee decided to have the meeting with the full understanding that the associate deputy would be here, ready and able to answer any relevant questions. I just wanted to point that out.

Also, I want to point out that we have one additional witness whom I didn't identify in my opening remarks. Ellen Burack, the director general of the greening of government operations, is here with us now. Welcome to the committee.

Ms. Meredith, associate deputy minister of Public Works and Government Services Canada, I understand you have some opening comments.

[Daphne Meredith, Associate Deputy Minister, Public Works and Government Services Canada]

Mr. Chairman and members of the committee, thank you for this opportunity to appear before you to discuss the March 2008 report of the Commissioner of the Environment and Sustainable Development on greening government operations.

The audit addressed two separate but related aspects of greening operations: the guidance that was provided to departments for preparing their 2007 to 2009 sustainable development strategies; and greening commodity management.

Public Works and Government Services Canada agrees with the commissioner's recommendations. We have developed a detailed action plan, which has been reviewed by the commissioner. I am happy to table this plan with the committee today.

In the case of greening procurement, the commissioner found that satisfactory progress is being made. Members will know that a green procurement policy was issued in April 2006.

We have already developed government-wide standing offers for purchasing 30 categories of goods and services, and 30 more are expected to be ready this year. Once these are in place, green standing offers will exist for commodities representing over $4 billion.

As it relates to the provision of central direction and guidance on greening to other government departments, the commissioner recommended that roles and responsibilities of departments be clearly defined. In our response, we undertook to clarify roles and responsibilities by April 2008. I am happy to report that this first step has been completed.

Even before we were made aware of the commissioner's recommendation, PWGSC had begun discussions with Treasury Board Secretariat, Environment Canada, and Natural Resources Canada to clarify the roles and responsibilities of these four key partners and all departments around greening government operations. It was generally agreed that to make further progress, new approaches would be required and that all four departments had a role in providing direction government-wide.

As a result of these discussions, it has now been agreed that Public Works will assume the lead for greening government operations. This will involve developing overall policy direction and guidance, facilitating information sharing, setting reporting standards, and reporting on progress.

Treasury Board Secretariat, Environment Canada, and Natural Resources Canada also have essential roles to play in providing guidance and advice in their respective areas of expertise, such as government-wide reporting and levers for directing and guiding action in the case of the Treasury Board Secretariat; priority-setting, use of the regulatory toolbox, technical expertise, and appropriate integration with sustainable development strategies in the case of Environment Canada; and expertise in greenhouse gas emissions reporting and on energy, water, and natural resources issues in the case of Natural Resources Canada.

PWGSC will be responsible for effective leadership of this horizontal endeavour, while we and our three key partners will be responsible for creating a solid framework. But it is all departments and agencies across the government that must be held accountable for, and recognized for their progress in, changing the environmental footprint of federal operations.

While I recognize that more needs to be done, we have made significant progress in recent years, particularly with respect to green procurement, green buildings, and greening the fleet.

I am prepared and would be happy indeed to take your questions on the commissioner's report.

[The Chair, Liberal, Shawn Murphy]

Thank you very much, Ms. Meredith.

We're now going to go to Mr. Ian Shugart, associate deputy minister with the Department of the Environment.

[Ian Shugart, Associate Deputy Minister, Department of the Environment]

Thank you very much, Mr. Chairman.

As my colleague from Public Works and Government Services has just said, the Department of the Environment and other departments are engaged with them in clarifying the roles and responsibilities having to do with greening government operations. We're committed, for our part, to working with PWGSC under their leadership.

Perhaps it would be useful to the committee if I briefly outlined the four specific roles that Environment Canada has in regard to greening government operations.

First of all, we provide advice to Public Works and Government Services on priority areas for action. Greening government is, of course, about putting into effect what the government is talking about in policy terms. There should be a relationship between the government's environmental priorities and the actions it takes as a corporate citizen. Environment Canada, therefore, will advise Public Works and Government Services on making the choices that square well with environmental priorities.

Secondly, we are engaged with them in providing technical support. In the example of greening commodity management, which is another topic within chapter 10, Environment Canada was one of the sponsors for the April 2006 federal policy on green procurement. As part of our role in sponsoring this policy, we provided technical expertise on environmental issues to those who procure the goods and services on behalf of the Government of Canada. This expertise is provided to the office of greening government operations in PWGSC as one element in their work to issue procurement instruments for the goods and services purchased most frequently.

Third, as you know, we are the coordinating lead for the sustainable development strategies. In that role Environment Canada works with Public Works to ensure that greening government operations is appropriately integrated into the sustainable development process.

Fourth, and finally, Environment Canada can use its regulatory power when that is appropriate, when the circumstances call for it, to further the greening of government operations. For example, the Canadian Environmental Protection Act gives the government the authority to issue regulations concerning government operations on federal and aboriginal lands. One such regulation pertains to storage tank systems for petroleum products and allied petroleum products. In fact, a new proposed regulation being worked on now will have a broader scope of application, and it will provide a more comprehensive framework to effectively prevent pollution from storage tank systems of federal government operations. I offer that as one example.

We look forward, of course, to working with PWGSC in their leadership role through these functional roles that we have as we move forward on greening government operations.

Thank you, Mr. Chair.

[The Chair, Liberal, Shawn Murphy]

Thank you, Mr. Shugart.

Mr. Jean.

[Daniel Jean, Associate Secretary, Senior Associate Secretary's Office, Treasury Board Secretariat]

Thank you, Mr. Chairman and committee members, for the opportunity to be here today.

Treasury Board Secretariat is a supporter of green government operations and has committed to building on the efforts to date and ongoing improvements. The Treasury Board Secretariat is pleased to work with Public Works and Environment Canada on greening government operations. Public Works has a great deal of operational expertise in these areas and has influence over much of the federal government's real estate holdings and procurement. Therefore, Public Works is well placed to lead efforts in this regard.

The role that will be played by the Treasury Board Secretariat relating to the greening of government operations will complete and support those efforts. As a central agency, we will support the leadership of Public Works Canada by cooperating with them and with other departments to establish government-wide targets.

We will help Public Works Canada to issue guidance or guidelines as required to make those targets compulsory within the whole of government. The Treasury Board Secretariat will also see to it that the departments provide appropriate reports on their success relating to those of targets in the context of their Reports on Plans and Priorities and their Departmental Performance Reports, and this information will be shared with Public Works Canada.

In partnership with Public Works, Environment Canada, and Natural Resources Canada, we can provide strong leadership on this file. We have worked hard to establish and refine clear roles for each other and to effectively communicate those to departments in order to ensure that progress is made on this important aspect of sustainable development.

Let me highlight from Treasury Board Secretariat's perspective some of the progress made with respect to generating a greener federal government.

TBS, Environment Canada, and Public Works have collaborated to further strengthen reporting requirements across government. We now require greening government operations reporting through both the RPP and through reporting on implementing the policy on green procurement.

Furthermore, the 2008-2009 Report on Plans and Priorities requires that departments submit information on how they plan to take account of environmental issues and to include them in their decision-making process, whether it be for purchasing, for their objectives relating to green purchases or for related benefits.

At the same time, Treasury Board Secretariat will focus its efforts to further simplify government operations according to the promise made by the government to reduce bureaucratic hassles which too often stifle progress.

In keeping with this approach, we will work with public Works, Environment Canada, and Natural Resources Canada to green existing policies and directives before we create new ones. This will ensure that we're not adding to the web of rules.

In conclusion, we recognize that greening government operations can progress more rapidly, and additional effort is needed to achieve this. Treasury Board Secretariat, Public Works, and Environment Canada will continue to act on our path forward for greening government operations.

This now concludes my remarks. I will be pleased to respond to any questions.