Public Accounts Committee on Feb. 21st, 2019

[David Christopherson, NDP, Hamilton Centre, ON]

Okay, that's good to know. We can do some follow-up through our report and make sure there are timelines and accountability.

I want to ask one more question if I have time. It sounds like I'm going to get one in.

It's probably affirming the same thing, Mr. Berthelette, but you said something that struck me. You were responding to a question by a colleague, and you were talking about the value for money. At one point you said there were other matters, not just value for dollars, that gave you some concern.

I wonder what exactly you meant by that. It was in response to a member suggesting that things weren't all that bad when you look at what was achieved. You talked about what you went in and examined, and you said that there were other matters, not just value for dollar, that you believed came into play.

I'll give you a chance to comment on that.

[The Chair, Conservative, Kevin Sorenson]

Mr. Le Goff.

[Philippe Le Goff]

Mr. Chair, one of the concerns we had at the time of the audit was that the priorities made under the connect to innovate program were not made public. The areas that would be considered first were not made public, so we had cases where local groups made some proposals, business cases, but they didn't know that in their province it was almost always determined that another area would get the funding first.

[David Christopherson, NDP, Hamilton Centre, ON]

How was that decision being made?

[Philippe Le Goff]

You might ask the department to answer that.

[David Christopherson, NDP, Hamilton Centre, ON]

Deputy?

[John Knubley]

In all respects, what I understand is that we follow a very strong due diligence process. I think the issues at play here are—and they relate to the overall strategy as well—is what are the technologies at play and what are the specific community needs? Again, this links back to technology in part. One of the things is that there's no one solution to putting broadband into any one place: You can do hardwire, you can do mobile, you can do text mobile, you can do satellite. One of the things you need to do from a technological perspective is to try take into account what the appropriate requirements are for any one particular area.

In this case, I do want to stress why the issue of value-for-money gets complex. Given where you come from, you'll understand that these are communities of the remotest type. We're talking about northern Quebec. We're talking about northern Ontario.

[David Christopherson, NDP, Hamilton Centre, ON]

Deputy, I'm sorry to interrupt you, sir, but I have very limited time. In fact, I'm probably on borrowed time. I have to say, the theory is that there were decisions made about where money was allocated and because the information wasn't public, we don't really know. The Auditor General is saying that it wasn't necessarily value for money. That's a nice way of saying that it seems like somebody's invisible hand is in there moving stuff around and it's hard to hold people to account because there's no public information.

Thank you, Chair.

[The Chair, Conservative, Kevin Sorenson]

Thank you, Mr. Christopherson.

We'll now move to Mr. Graham.

[David Graham, Liberal, Laurentides—Labelle, QC]

I'm going to stay on the topic of value for money for a second.

Telecommunications companies invest on the basis of a three-year return on investment. That's the speed they do it. Is that the speed of return you expect of government investment? That's for the Auditor General.

[The Chair, Conservative, Kevin Sorenson]

Either Mr. Berthelette or Mr. Le Goff could respond.

[Philippe Le Goff]

It was not something that we considered in the audit, Mr. Chair.

[David Graham, Liberal, Laurentides—Labelle, QC]

Okay. Do you consider telecommunications to be strictly a business, or is it or should it be a public infrastructure?

[Jerome Berthelette]

Mr. Chair, I think the department has already more or less stated it has both business aspects and public necessity to it.

[The Chair, Conservative, Kevin Sorenson]

I think I'm going to interrupt a little bit here. I think we need to recognize that we are sometimes getting into policy here, and we need to remember that the Auditor General's responsibility is not to determine the validity of the policy. It's to determine whether or not there is a way to deliver the listed policy in an effective manner. I think all of us on the committee have to remember that the parameters of the audit as listed were to look and see if there was, I suppose, some value for money, but if it's found in the conclusion that Canada did not develop and implement a national strategy to improve.... That's the focus of the audit.

Sometimes we get into the weeds on everything else and maybe that's a good time to ask the department, but the auditors are not going to give us a broad synopsis of connectivity in Canada. They're going to look at these very tight parameters, and I think that's what we have to drill down on if we're coming to the Auditor General. We can branch off to the different sectors on their way, but we shouldn't really even be going to the policy at all because the government sets the policy, departments deliver, and auditors check to see if departments have delivered.

If I'm a Conservative and I don't like a Liberal policy, that's neither here nor there at this committee. The government sets a policy, the departments deliver on it, and the auditors ask, did they do it in the best way possible?

If we're going to ask about the process, you can ask the auditors about their audit, but everything else should go to the departments.

Mr. Graham.

[David Graham, Liberal, Laurentides—Labelle, QC]

With respect, Mr. Chair, what I'm looking to find out is to understand what the value is in this circumstance.

[The Chair, Conservative, Kevin Sorenson]

Okay.

[John Knubley]

Mr. Chair, maybe I could just add the department's perspective on value for money. I think what we thought mattered in the connect to innovate program was that we leveraged funds. As we mentioned early on, and as the Auditor General people referenced, was the one-to-one. We went from a $500 million investment to $1 billion. In assessing the projects, we also avoided overlap of activity, if you like, so that we ensured that if any one company was doing something, it wasn't covering into another area. Again, we were trying to fix a specific problem.

The issue of scale and technology is part of value for money, and our perspective is that this is a very important consideration. It's not just how you want to fix it today, but whether the companies involved in the projects actually develop investments that will develop the technology over time. It also has to do with the number of communities served as part of the value for money.

From our perspective, at any rate, it's not just dollars and competition of the private sector involved in the projects. It's also these other matters.

[David Graham, Liberal, Laurentides—Labelle, QC]

I have one question left for the AG before I go on to the CRTC.

Does the Auditor General's office currently participate, or has it ever participated, in the interchange Canada program?

[Jerome Berthelette]

Yes, we have.

[David Graham, Liberal, Laurentides—Labelle, QC]

Do you do this actively?

[Jerome Berthelette]

I don't think we actively do it, but we have participated in it.

[David Graham, Liberal, Laurentides—Labelle, QC]

All right, thank you.

I'm going to go back to the CRTC and pick up where I left off earlier.

On the mandate question, if the CRTC mandate were expanded to permit the direct breaking of telecom monopolies and positional abuse, or the power to mandate that a company that services a community must service the entire community, would the CRTC be comfortable applying that?

[Ian Scott]

It's very much a hypothetical question, and perhaps in my response I can also try to answer a question Mr. Arseneault asked earlier.

The commission's overall role is to supervise the industry. It goes to the discussion we just had about the CRTC changing the basic service objective, that the original objective in telecommunications was universal service—getting every household phone service.

The carriers actually have an obligation to serve. That has not been removed. We do have competition in most places, and we rely, to the extent we can, on competition. Where there's a lack of competition, we still engage in more traditional detailed regulatory tools to oversee the services provided. The broadband fund is the vehicle that we hope to use, and will use, as an incentive and a tool to fulfill the broadband service objective in those harder-to-serve regions.

[David Graham, Liberal, Laurentides—Labelle, QC]

When will the broadband fund applications be opened?