Public Accounts Committee on March 13th, 2012

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

Now, these programs were administered through regional development agencies. My experience with regional development agencies is that their role is economic development resulting in job growth. I would think that they have the tools available naturally, through what they already do, and that it would be fairly easy, I would think, to actually measure the end result of job creation when that time comes.

Do you have any concerns that you won't be able to measure the job impact of the community adjustment fund?

[Elisha Ram]

I think there clearly was an emphasis placed in the way that the overall Canadian economic action plan proceeded to be able to measure what the outcomes were in terms of job creation as well as broad economic impact.

To the extent that there is a difference with the community adjustment fund.... As you mentioned, it was delivered by the regional development agencies, compared to most of the other programs, which were delivered by a single department or agency. There is potentially more variety in how the regional entities go about their business. They understand the region in which they operate.

The sheer diversity of projects that were pursued for that program potentially made it more difficult to have standard measurements, in terms of whether a community action plan or a community economic transition plan would have an impact with the direct job creation relative to some of the other projects that were pursued for that initiative.

[Bryan Hayes, Conservative, Sault Ste. Marie, ON]

Mr. Campbell, you said the design would need to be changed to measure the job creation component. There is a part of me that looks at the fact that these are administered through development agencies and they're really not short term. Generally, when you look at economic development it is a sort of long-term thing.

I'm just wondering, even had the design allowed for it, wouldn't it be premature to analyze the job creation until these projects were actually under way for a certain length of time? I don't know if that's a fair statement.

[Ronnie Campbell]

Mr. Chair, I'm going to ask Mr. Affleck if he could please answer that one.

[John Affleck, Principal, Office of the Auditor General of Canada]

The community adjustment fund, as you know, was set up temporarily, and the regional development agencies do this as part of their regular business. In terms of the contribution agreements that we examined, the reason we commented on them was because all of them had performance indicators in there related to the number of jobs created or maintained.

The issue that we found was a lack of standardization. The regional development agencies collected this information in a variety of ways, and in one case stopped collecting it altogether. So at the end of the day it made it very difficult to roll it up.

[The Chair, NDP, David Christopherson]

Okay. That's it, Mr. Hayes. Sorry. In fact we're quite a bit over, actually a minute and a half, for the record. But that's all right; it was interesting questioning.

Madame Blanchette-Lamothe, you have the floor.

[Lysane Blanchette-Lamothe, NDP, Pierrefonds—Dollard, QC]

Thank you, Mr. Chair.

I am going to go with the same questions Mr. Hayes just asked.

Mr. Nevison, you spoke about how the data was collected with respect to the job creation objective. You were rather positive with regard to the data collection.

I would like to know if, like the OAG, you are of the opinion that we cannot rely on the job data because different means were used to collect it.

[Douglas Nevison]

Thank you.

We agree that because of the diverse projects and proponents, it's very challenging to get consistent project-level data across that board. As I mentioned, even if you were able to get that completely consistent across 20,000-something projects, there still is a missing element in terms of job impact. That was the reason.

We weren't saying that the bottom-up job state isn't helpful; that obviously is important. But in terms of assessing the overall impact of the economic action plan on the economy and jobs, we believe the model-based approach we used was the appropriate way to go. As I mentioned, that has been validated by other private sector economists in other countries.

[Lysane Blanchette-Lamothe, NDP, Pierrefonds—Dollard, QC]

I am sorry, but that is not clear. Do you believe, yes or no, that we cannot rely on the date to determine if the job creation objective was met?

[Douglas Nevison]

As I said, even if it was consistent, it wouldn't be an appropriate measure of the job impact. But as the Office of the Auditor General has noted, there were consistency problems across projects.

I think that would be expected across such a wide range of project proponents. That's the reason we had to take a different approach in terms of assessing the overall impact.

[Lysane Blanchette-Lamothe, NDP, Pierrefonds—Dollard, QC]

Mr. Campbell, the overview to chapters 1 through 5 states that, over the years, the OAG has published few positive reports about information for management. I am wondering why that is.

Could you briefly comment on that? Is it because that is not the priority of the people who collect the information? Is it because it is particularly difficult to collect good data? Could you briefly comment on this?

[Ronnie Campbell]

If I have understood correctly, Mr. Chair,

I think the comment on the community adjustment fund is in relation to the inability to gather information on that program to determine whether that program made its objective. We think that's a concern. You're talking about billions of dollars, and that's important.

In terms of the overall impact of the economic action plan, the assessment that is yet to come, I think the government has a point that you would go about such a broad assessment in a different way. However, it was mentioned earlier in the evening that a variety of tools were used: existing programs, new programs, tax measures, and the like. It would be useful in any overall assessment for the government to get a sense of which ones really worked and which ones worked a little less, so in the future they could learn from that as a basket of tools. I'm sure the whole $47 billion had an impact, but to what extent each of the tools helped would be a good question.

[Lysane Blanchette-Lamothe, NDP, Pierrefonds—Dollard, QC]

Thank you.

I will turn it over to Mr. Dubé.

[Matthew Dubé, NDP, Chambly—Borduas, QC]

I have a quick question. I would like to go back to the question posed by my colleague, Mr. Allen, who spoke about a date for the performance report. We are not just talking about public accounts that deal with funds. We also want to know about the effectiveness of the program, especially the extent to which objectives were met.

You said that you cannot speak for the government about the date of the report. However, you are here as an expert in the field. Perhaps you could make a recommendation about the appropriate time for tabling such a report given that we do not want it to be too long after the end of the program. We do not want it to have disappeared from our collective memory.

[Rick Stewart]

Thank you.

I would repeat my earlier comment that as we are in the process now of evaluating and assessing the final receipts we've received for project expenses incurred, I do not have a specific date for when that work will be completed, but it is being dealt with. I am equally not in a position to commit the government to a specific date, but I will repeat my comments about the past practices of the government to provide updates on the implementation and effectiveness of the economic action plan activities in the context of their regular reporting to Canadians.

[The Chair, NDP, David Christopherson]

Time has expired. Merci.

The last speaker on our rotation is Mr. Dreeshen, who is last but not least.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you very much, Mr. Chair.

I was struck by something Mr. Stewart mentioned earlier. He said that cross-ministry collaboration and the features of the economic action plan brought out the behind-the-scenes work that always takes place behind the scenes and put it into public consciousness.

Could you address that just quickly, Mr. Stewart? I also have some questions about the knowledge infrastructure funding.

[Rick Stewart]

Thank you.

I would add one thing to my previous comments. If you look at the challenges that Canadians and the country face when they look to government for activities or efforts to address some of these, those issues do not live within one specific ministry. Increasingly, they are issues that transcend multiple ministries and multiple lines of business. Clearly, if the government is going to be able to respond to these challenges that we face in a comprehensive fashion, out of necessity it will need to involve the engagement of multiple departments.

In a sense, many of the issues and programs the government is dealing with today depend on close inter-ministerial collaboration and the development of appropriate and effective responses and on the delivery of those programs once the government makes decisions.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you.

To go a little further than that, you just mentioned the engagement of multiple departments, but we also had the engagements of provinces and territories and municipalities. We're also looking at the impact that was associated with them and realizing that they were also having to incur more debt in Alberta, going into their sustainability fund in order to match what was happening. As were the municipalities, they were also recognizing the significance of what was going on at the time. And to be able to get everyone to commit to this, it was a case of looking at everybody's tax dollars, because the dollars were coming, but the projects were being done sometimes at thirty cents on the dollar, because the bids that were coming in on particular projects allowed us to get so much more done than we traditionally could have. I think it's significant that we looked at the departments and the flexibility they had to work together as well as looking at what was done by the provinces and the municipalities to tie that in.

I'm wondering if people have a quick comment on our ability to work with those other entities.

[Taki Sarantakis]

Virtually every project that we did at Infrastructure Canada was done in partnership with a province or a municipality. One of the big goals in the economic action plan was to actually leverage the funding of other partners. For instance, in the case of Infrastructure Canada, under the rubric of the economic action plan, while $10 billion was committed federally through this project, that leveraged in total $30 billion from other partners. So you can see that the stimulus there was a quantum of about three times more than would have otherwise been the case.

[Earl Dreeshen, Conservative, Red Deer, AB]

Thank you.

Now I'd like to come back to one of the areas I'm especially concerned about and interested in. I've had the opportunity over the last couple of years to travel to many universities and colleges across Canada. Every institution has expressed their gratitude for the knowledge infrastructure fund, how timely it was, how it was targeted to the needs of the institutions, and how it allowed them to play a critical role in enhancing a training opportunity for students.

As Mr. Dunlop mentioned, you have also tied in things such as energy efficiencies, the teaching capacities, and research capacities, and I've been able to measure the impact that's associated with that. As a matter of fact, last Friday I was with a group of MPs who went to Alberta. We went to Red Deer College and University of Calgary. We were able to take a look at some of the innovation that had taken place, and how they look at positioning themselves for the future. So they've been able to take that information as well.

As we take a look at this major input into universities, which isn't traditionally something that is done by the federal government, I wonder if perhaps you could outline for the committee what measures the government put in place to ensure that taxpayers' money was indeed spent not just wisely, but appropriately.

[Robert Dunlop]

Thank you, Mr. Chair.

If I understand the question correctly, the way the government ran this program was that applications were received either by the institutions themselves or, in the case of Quebec, through the Quebec government, with the provinces indicating which projects they would support, because they were in for an equal amount.

After that time, we basically followed the regular kinds of requirements for the utility of the project that a normal project would follow. The fundamental difference was that they also had a requirement to be able to complete the project within the two-year stimulus period. So there wasn't a lowering of eligibility criteria in any way. There was, in fact, the addition of another eligibility criterion, which meant that although an institution might have had an idea for a better or more interesting project, if they couldn't demonstrate to officials that it could be delivered within the two-year stimulus period, it wasn't eligible.

[The Chair, NDP, David Christopherson]

Thank you. We're well over time.

Colleagues, thank you. That ends our first round in totality. We have some time. I understand there may be some appetite to continue until 10:30, at which time I would ask the committee to turn to committee business to deal with a couple of things.

Is there agreement to do that? We'll just continue in rotation until we're at 10:30, and then we'll stop and move to business.

I just want to ask one question, if I may, before we go to the second round.

Mr. Campbell, you mentioned early on that one of the things that made this most effective was the ability of senior players, in particular deputies—I see Mr. Affleck nodding his head—to be hands-on involved, which made a world of difference in terms of the outcome. I don't think that's surprising, given that it's obviously the best talent in the department, and that having their eyes on these things is the best circumstance, because they can make anything happen as they need to.

However, it's obviously not sustainable. There are only so many files that can be super-files in front of a deputy, given all the other things they have to be responsible for. Yet I've been on this committee enough to know—and recently we had it with the reserve pension plan—that one of the reasons the work didn't get done was because senior management wasn't given the responsibility to manage these things in a timely way.

Therefore, in an ideal world, Mr. Campbell, what kinds of systems work best for deputies who want to be as hands-on as possible, but can't with every file? What kinds of systems should they be looking at, and why do some seem to be more successful than others at being able to be where they need to be to avoid discrepancies and gaps?

[Ronnie Campbell]

Thank you.

I'm glad you mentioned sustainability, because I think it would be a mistake to believe that all government programs and initiatives could be managed in this way. I think we mentioned in testimony when we did the first audit that a lot of that was unsustainable and a lot of people worked a lot of long nights within the bureaucracy to do that. So I'm glad you mentioned that.

I think the answer to your question depends on the department and the nature of the issues. If it's a department that gets one big file once in a while, I think it's easy for a deputy to deal with it. I think deputies who have a lot of big files on an ongoing basis need to use their senior management structure. They need to make sure that they get good reporting within the department, and use their internal audit and their department audit committee as a good sounding board to give the deputy advice whether you have to stay on this one and stick with it.

Thank you.

[The Chair, NDP, David Christopherson]

Very good. Thank you. I appreciate that.

Okay, away we go. First up will be Mr. Saxton and Mr. Kramp, who are splitting the next round. We'll begin with Mr. Saxton.