Public Accounts Committee on Feb. 21st, 2019

[David Christopherson, NDP, Hamilton Centre, ON]

Well, thank you. That's the way I read it too, and I just wanted to hear it straight up, because it seems to me, in the three and a half decades I've been in public life, that whenever we're faced with a public challenge, the first thing we do is to get a strategy, to get a plan, and then start working at getting the funding. And if we can't get all the funding up front, then there is a phase-in and we can get into the politics of when that money kicks in.

However, the idea that we don't do a strategy because the money is not there up front makes no sense at all to me. I will turn to the deputy.

Help me understand why, when there were repeated recommendations that there needed to be a national strategy, your department didn't do a strategy because you didn't have sufficient funds. I don't get it.

[John Knubley]

I think it is important for members to understand that since 2001 there has been a staged approach, which is a strategy, to closing gaps in broadband. The strategy has been to identify where there are areas of greatest need and to address those.

What has happened as a result of the declaration in December, 2016 that broadband is a basic service and that we agree as a country on moving towards a 50/10 goal—because in the past there have been different views on what the goal should be, and whether it should be 5/1, 30, or 50/10—is that we are now in a position, thanks to the CRTC I would say, to work together in an integrated way to really address the issues together, along with the provinces, private sector, etc.

I would make just one more point about that staged approach. I think that the underlying policy issue at play always, and it continues to be even in this new integrated world we're in, is how to ensure that we get value for money and do not crowd out what private sector input would normally occur.

So there is always a balancing act going on between what is the public interest in closing these gaps and how we work with the private sector, and indeed with provinces and communities, to ensure that there is value for money as we go forward.

[David Christopherson, NDP, Hamilton Centre, ON]

Yes, I appreciate that. I'm sorry, sir. It was nice and it was somewhat informative, but it didn't answer my question.

My question is, why wasn't a strategy put in place? I hear you. It sounds as though there were bits and pieces of one—

[John Knubley]

There was a strategy of staged implementation and—

[David Christopherson, NDP, Hamilton Centre, ON]

But it wasn't a national strategy.

[John Knubley]

—now we've moved to a national strategy.

[David Christopherson, NDP, Hamilton Centre, ON]

Now you've moved to a national strategy. My question is, why wasn't there one in the beginning? If it were a health care issue.... It's not as though we don't know these challenges—transportation, health care, community services. It's always difficult in a large country like this, and it's expensive. That's why we have plans and phase-in and that's why there are constant protests coming from the north and far-flung regions about why they're not getting service equal to what we can get in my hometown of Hamilton.

But what I don't understand is why there wasn't a national strategy. It sounds as though there wasn't one because the money wasn't there to do one, which is just not acceptable. If this were a health challenge, we would have recognized that health challenge and we would have put a national strategy in place.

The absence of a national strategy—it looks to me like the politics of this, which is one step beyond you, are that we don't have the money and we don't want to pony up the money, so let's not have a strategy because that will give opponents something to point to in terms of what's not being done. Now it just looks as though they've run out of runway and they have no choice but to do it, and they're dragging their heels at that.

Chair, I know my time has probably run out, but I'll just finish my thought. This may be one of the very few times in the 15 years I've been on this committee that we do need to call a minister in, because it may just be that the answer to the problem has been that the bureaucracy has been told that there is not enough money to do a strategy, so don't even think of starting one. If that's the case, then there has to be a political answer to this, not a bureaucratic one.

[The Chair, Conservative, Kevin Sorenson]

Thank you, Mr. Christopherson.

We'll now move back to Monsieur Arseneault.

Mr. Arseneault, you have the floor for seven minutes.

[René Arseneault, Madawaska—Restigouche, Lib.]

Thank you very much, Mr. Chair.

My thanks to the witnesses for being here.

I am new to this committee and this is only my second meeting. Therefore, I don't know the full history of the witnesses who appeared or about your previous testimony. I apologize in advance if my questions may seem inappropriate to you.

I come from an extremely rural region: not the far north of Quebec, not an island lost in the Atlantic or Pacific or Sable Island, but Madawaska-Restigouche in northern New Brunswick, a place that is well within Canada.

Across my riding, the lack of broadband service is an irritant that prevents us from developing our full economic potential. I am talking about my region, but the situation is the same in many places in Atlantic Canada or elsewhere in the country, of course. The first casualty therefore is economic development, which leads to the exodus of people from our region who are educated and who could contribute to it, but who look for work elsewhere. Without economic development, there is no growth, and rural areas are being emptied to the benefit of large urban areas. I know you are already familiar with the picture I'm painting for you.

However, in addition to the economic development, there is the whole issue of safety. In my region, the vast majority of economic activity is based on forestry. There are a lot of forestry operations, where workers can get hurt. However, those areas have no access to any cellular signals. Access to ambulance services, hospitals, police and firefighters is a matter of safety.

So we are really lagging behind the Canadian average in terms of safety and economic development.

Mr. Scott, I think you said that basic telecommunications services are now essential, as was the railway to travel across Canada in another era. The construction of the railway was a national project led by the government, not the private sector. Setting up telephone service in New Brunswick was not a private sector project either, which makes me think that perhaps we should study that aspect of the issue. However, that is not what we are talking about today.

I have a question for my friends in the department, either Mr. Knubley or one of his colleagues. To pick up on what Mr. Christopherson was saying, has a study been conducted to establish the strategy and funding necessary to resolve this issue once and for all across Canada?

[The Chair, Conservative, Kevin Sorenson]

Mr. Knubley.

[John Knubley]

I think the first thing to emphasize is that the federal, provincial and territorial ministers met in October and decided to put a strategy in place. They talked about and agreed on the 50/10 target, a speed of 50 megabits per second for downloads and 10 megabits per second for uploads, which are decent speeds. They then asked officials to take an integrated approach to identify the future needs of the provinces, the federal government and the private sector, so that they can all work together to achieve this target.

I am convinced that, thanks to the CRTC, we are now in a better position to achieve this objective because we have a very specific target and tools for sharing and collaboration. The ministers established three fundamental principles for developing a strategy: access, innovation and collaboration.

Ms. Setlakwe leads a team working on this and perhaps she could add some comments.

[Lisa Setlakwe, Senior Assistant Deputy Minister, Strategy and Innovation Policy Sector, Department of Industry]

We are in the process of determining the gaps, province by province and territory by territory, and how much it will cost to connect those places. The areas that are easy to reach have been connected. In rural and more remote areas, the technology to get there is complicated and expensive.

We are in the process of completing this work. We estimate that this will cost about $8 billion, of which $7 billion will be used to connect the main communities in these areas.

You talked about the importance of having access to communications on major roads in forestry sectors such as those in your riding.

[René Arseneault]

They are forestry roads.

[Lisa Setlakwe]

I'm not sure we're going to make it to all the forestry roads, but we'll make it to the main roads. We estimate that it will cost about $1 billion.

[René Arseneault]

You're saying it will cost $1 billion in addition to the $8 billion?

[Lisa Setlakwe]

It's $8 billion in total: $7 billion for communities and $1 billion for main roads.

We haven't finished the job. We are working with the CRTC, the provinces and territories. We still have work to do.

[The Chair, Conservative, Kevin Sorenson]

We'll now move back to Mr. Kelly, please.

Mr. Kelly, we're in the second round now. You have around five minutes.

[Pat Kelly, Calgary Rocky Ridge, CPC]

Thank you, Chair.

Again at this committee we have a report from the Auditor General and departments that have said they accept the findings of the Auditor General, yet in the testimony I've heard, in particular in the answers to Mr. Christopherson's question, I sense push-back and defensiveness around the conclusion of the Auditor General.

Mr. Knubley, the Auditor General said that your department did not have a national strategy. Mr. Christopherson asked you why, and if I heard you correctly, I heard not only in response to his questions and to some of the other questions you repeatedly going back to the Johnston report of 18 years ago. It identified a strategy for which the objectives seem largely still unfulfilled 18 years later.

I'm going to repeat the question. Why was there no national strategy in particular after the CRTC declared broadband to be a public necessity? It's easy to declare something a necessity. Those are just words. Once you do that, though, there has to be a strategy and a plan to achieve objectives.

Please, do you accept the Auditor General's assessment that there was no national strategy, and if so, why?

[John Knubley]

The nuance I'm trying to bring to this is what the Auditor General raised, which we agree with, is that there was no national integrated strategy with a common, agreed-upon goal. We have now reached 50/10, and we have not had a situation before where all the players, whether the provinces or the federal government or even the private sector, have agreed on that goal and moved ahead.

[Pat Kelly]

So what has happened?

[John Knubley]

I agree there was no national integrated strategy in that sense, and the Auditor General was totally appropriate to point that out. Very shortly after the CRTC identified broadband as a basic service, the government moved ahead very quickly to work on an integrated strategy with provinces, to agree that 50/10 was a goal, to bring together working groups that include the CRTC and the provinces.

[Pat Kelly]

Sir, you did not answer my question. You did not answer Mr. Christopherson's question.

Why was there no strategy? If this has been identified and understood for years, the objectives—

[John Knubley]

Because no one could agree on a common technological goal: provinces might have 30 as a goal, for five to one. Technology is always an issue. Various players don't always agree on the extent to which the private sector will go in and solve a situation or where they will invest. As the Auditor General pointed out, in terms of value for money, a big issue is, how do you balance public investment with private sector investment? Even in the case of our 50/10 goal, we have already identified that we're going to move from 84 to 90, really, with private sector investment. Private sector companies invest $12 billion a year to do this.

[Pat Kelly]

Okay, thank you.

[John Knubley]

Again, I guess I am saying that it's not straightforward, but complex. The nuance that I'm trying to bring to this is that all governments in the last 15 years, of whatever stripe, have taken the approach of identifying specific gaps. It's a staged approach. What are the specific problems that we're trying to address? Are we trying to do the last mile, where we hardwire two households? Are we trying to do more backbone-type activity, where we take the broadband to a community, to a school? What's the best solution to help the community and to provide the best service to these very remote areas that Canada encounters across the country?