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Evidence of meeting #33 for Public Accounts in the 41st Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was projects.

A recording is available from Parliament.

On the agenda

MPs speaking

Also speaking

Ronnie Campbell  Assistant Auditor General, Office of the Auditor General of Canada
David Enns  Deputy Assistant Secretary, Expenditure Management, Treasury Board Secretariat
Rick Stewart  Assistant Secretary to the Cabinet, Liaison Secretariat for Macroeconomic Policy, Privy Council Office
Taki Sarantakis  Assistant Deputy Minister, Policy and Communications Branch, Infrastructure Canada
Natasha Rascanin  Assistant Deputy Minister, Program Operations Branch, Infrastructure Canada
Robert Dunlop  Assistant Deputy Minister, Science and Innovation Sector, Department of Industry
Douglas Nevison  General Director, Economic and Fiscal Policy Branch, Department of Finance
Elisha Ram  Director, Microeconomic Policy Analysis, Department of Finance
John Affleck  Principal, Office of the Auditor General of Canada
Clerk of the Committee  Ms. Joann Garbig

8:50 a.m.

NDP

The Chair NDP David Christopherson

I'll now call to order this 33rd meeting of the Standing Committee on Public Accounts.

Colleagues, we have one or two small matters of business to deal with. Given what's in front of us, if we wrap up our discussions with our witnesses 15 minutes early and do some committee business, would anybody have a problem with that?

Gerry.

8:50 a.m.

Liberal

Gerry Byrne Liberal Humber—St. Barbe—Baie Verte, NL

Could you state what our committee business is, Mr. Chair?

8:50 a.m.

NDP

The Chair NDP David Christopherson

The schedule.

Is there anybody else?

Okay, no problems. So we'll wrap this up 15 minutes early and then go into a business session.

With that, if there are no further interventions we'll move forward and welcome all of our guests today. There is quite an array. Welcome, all.

Ronnie, I'll ask you to start with your delegation from the AG's office. Then, whoever is most senior, if you'd take responsibility for introducing your colleagues that would be much appreciated.

Mr. Campbell.

8:50 a.m.

Ronnie Campbell Assistant Auditor General, Office of the Auditor General of Canada

Thank you, Mr. Chair.

I'm accompanied today by John Affleck, the principal on this audit.

8:50 a.m.

David Enns Deputy Assistant Secretary, Expenditure Management, Treasury Board Secretariat

David Enns, from Treasury Board Secretariat. I am here with A.J. Preece.

8:50 a.m.

Rick Stewart Assistant Secretary to the Cabinet, Liaison Secretariat for Macroeconomic Policy, Privy Council Office

Rick Stewart, from Privy Council Office.

8:50 a.m.

Taki Sarantakis Assistant Deputy Minister, Policy and Communications Branch, Infrastructure Canada

Taki Sarantakis, Infrastructure Canada.

8:50 a.m.

Natasha Rascanin Assistant Deputy Minister, Program Operations Branch, Infrastructure Canada

Natasha Rascanin, Infrastructure Canada.

8:50 a.m.

Robert Dunlop Assistant Deputy Minister, Science and Innovation Sector, Department of Industry

Rob Dunlop, from Industry Canada, along with Shane Williamson, who is executive director of KIP.

March 13th, 2012 / 8:50 a.m.

Douglas Nevison General Director, Economic and Fiscal Policy Branch, Department of Finance

Doug Nevison, from the Department of Finance.

8:50 a.m.

Elisha Ram Director, Microeconomic Policy Analysis, Department of Finance

Elisha Ram, also from the Department of Finance.

8:50 a.m.

NDP

The Chair NDP David Christopherson

All right. With that, we will begin.

Mr. Campbell, we'll begin with your opening remarks, sir.

8:50 a.m.

Assistant Auditor General, Office of the Auditor General of Canada

Ronnie Campbell

Thank you, Mr. Chair.

Mr. Chair, thank you for the opportunity to discuss chapter 1 of our report on Canada's economic action plan. I am accompanied today by John Affleck, the principal on this audit.

As you are aware, the economic action plan was launched in January 2009 in response to the global economic downturn. The plan was intended to stimulate the economy through measures that injected $47 billion in federal spending of public dollars into sectors of the economy and regions of the country in need. This is the second audit of the economic action plan carried out by our office.

Both audits examined programs largely related to infrastructure. In the first audit, tabled in October 2010, we found that the projects we tested met the eligibility criteria established by the terms and conditions of the different programs included in our audit. We also found that government departments and agencies expedited the implementation of economic action plan programs.

To speed up project approval, this department has relied on the attestations of organizations and provinces that projects were construction-ready.

At the time of our first audit we observed that some projects were not construction-ready, despite the attestations, and raised the concern that completion deadlines would not be met.

In the second audit we audited three programs that had been part of the first audit: the infrastructure stimulus fund, knowledge infrastructure program, and community adjustment fund. Together they provided stimulus funding totalling $7 billion.

We examined whether selected federal departments and agencies had monitored progress and federal spending, including whether projects were being completed as intended, had taken corrective action where necessary, and had reported monitoring information to Parliament through departmental performance reports.

We found that the federal entities monitored the progress and spending of projects, permitting them to take corrective action in a number of cases. And, despite deadline extensions, the three programs in our audit largely achieved the economic action plan objective to spend federal resources within the two-year time frame.

Departmental data we examined showed that some stimulus projects were progressing slower than expected and were at risk of missing the March 31, 2011 deadline. At the same time, the government was being pressured by municipalities, among others, to allow more time for projects to be completed.

Accordingly, the government reconsidered the deadline for selected economic action plan programs, and it announced the extension of the funding deadline to October 31, 2011 for four infrastructure programs. We found that extensions were supported by an analysis done by the Privy Council Office and the Department of Finance Canada.

Mr. Chair, many projects in both the infrastructure stimulus fund and the knowledge infrastructure program were extended. At the time of our audit, final claims and close-out reports had not yet been submitted. We believe that enough time has passed now for both Infrastructure Canada and Industry Canada to know the total federal spending and final results for these projects.

In the second audit we found that the presentation of the economic action plan performance information in departmental performance reports was fragmented. This made it difficult for parliamentarians and Canadians to obtain an overall picture of results achieved against performance expectations and public resources spent.

Mr. Chair, the significance of $47 billion in federal spending calls for transparent reporting to Parliament on overall stimulus effects. We recommended in our first audit that central agencies prepare a summary report to Parliament at the conclusion of the economic action plan that includes a detailed account of its impact on the economy. The Privy Council Office and the Department of Finance agreed.

Your committee may want to ask the Privy Council Office and the Department of Finance to elaborate on the plan and timeframe for reporting to Parliament on the delivery and economic impact of the economic action plan.

Mr. Chair, this concludes my opening statement. We'll be pleased to answer any questions your committee may have.

8:55 a.m.

NDP

The Chair NDP David Christopherson

That's very good. Thank you, Mr. Campbell.

I don't have a copy of an opening comment from anybody else. I'm assuming somebody has a response to the Auditor General's report.

8:55 a.m.

Assistant Deputy Minister, Policy and Communications Branch, Infrastructure Canada

Taki Sarantakis

In order to leave more time for your questions, we decided not to do opening remarks. We thought the Auditor General's opening remarks covered the scope of the audit.

8:55 a.m.

NDP

The Chair NDP David Christopherson

Okay. It has been the practice, though, even if that's all you said to provide some opening remarks so we have a balanced starting point. We're very straightforward folks; we like things nice and simple and straight.

In the future--and please pass this on to your colleagues--there is an expectation of at least some cursory remarks; usually it's in depth, but if not, at the very least, we'd appreciate some kind of presentation. We'll let it go this time, but I don't think it's right that we have all these folks and there's not one comment from the government side of things.

All right, that being the way it is, we will begin a rotation. Unless there's an intervention, we will begin with Mr. Saxton.

You have the floor, sir.

8:55 a.m.

Conservative

Andrew Saxton Conservative North Vancouver, BC

Thank you, Mr. Chair, and thanks to all our witnesses for being here this morning.

Canada's economic action plan was an enormous undertaking, as was mentioned, $47 billion worth of projects, over 20,000 projects, some have said as many as 26,000 projects across the country. It was unprecedented in size and scope, at least in peacetime Canada, and thousands of jobs were created in the process as well as thousands of projects, which will benefit Canadians for generations to come.

My first question is to the Treasury Board. Can you explain how Treasury Board prepared for this enormous undertaking, especially when it came to approvals of funding for these projects?

8:55 a.m.

Deputy Assistant Secretary, Expenditure Management, Treasury Board Secretariat

David Enns

Thank you.

Treasury Board, in consultation with our central agency colleagues, investigated the possibility of seeking both policy and Treasury Board approvals roughly at the same time to expedite the approval process.

We took a risk-based approach and speeded up our approvals process, working with the departments as they prepared the submissions.

8:55 a.m.

Conservative

Andrew Saxton Conservative North Vancouver, BC

How did you feel about the planning? Was it sufficient to accomplish what you needed to accomplish?

8:55 a.m.

Deputy Assistant Secretary, Expenditure Management, Treasury Board Secretariat

David Enns

We were happy with the results. Again, it was confirmed in the audit of the Auditor General that the appropriate measures had been taken. While it was onerous for the people working in the central agencies to do that, we felt it was successful.

8:55 a.m.

Conservative

Andrew Saxton Conservative North Vancouver, BC

Thank you.

My next question is for Infrastructure Canada. How did your department prepare for the delivery of all of these significant projects?

8:55 a.m.

Assistant Deputy Minister, Policy and Communications Branch, Infrastructure Canada

Taki Sarantakis

As our colleague from Treasury Board noted, first and foremost there was an expedited approval process, so the memorandum to cabinet and the Treasury Board submission were done very rapidly. I think that was in large part due to the tremendous cooperation we had from our colleagues at the Department of Finance, who very much worked with us in a collaborative way so that when the budget was presented in January 2009 we had a very good idea of what was going to be in the budget, and we could produce our materials very quickly. That was the bulk of our preparation.

8:55 a.m.

Conservative

Andrew Saxton Conservative North Vancouver, BC

Thank you.

The knowledge infrastructure program has received a lot of very positive attention. I can say that for my riding in North Vancouver the new film centre at Capilano University is a significant addition to the community. Not only did it create a significant number of jobs during the construction phase, but it is also poised to become one of the premier places to study film in Canada. We expect that the next James Camerons of this world will hopefully come from North Vancouver as a result of this project.

The knowledge infrastructure program was such a huge success. Can you explain to us how you prepared for that program.

8:55 a.m.

Assistant Deputy Minister, Science and Innovation Sector, Department of Industry

Robert Dunlop

Thank you, Mr. Chair.

We had our unique challenges at Industry Canada, in that we had never run an infrastructure program before, so we had some basic set-up to do that others didn't. We got tremendous support from Infrastructure Canada, which took us through some of the unique requirements of running an infrastructure program. As the Auditor General noted, we also reached outside and hired expertise in monitoring construction activities and that kind of thing, which we didn't have internally. We also depended on our regional staff to follow individual projects and report back, as well as the engineering company that we had engaged.

9 a.m.

Conservative

Andrew Saxton Conservative North Vancouver, BC

How did you monitor those projects as they were being constructed?