Public Accounts Committee on May 2nd, 2019

[Michael Nadler]

Very few visitor-facing sites would be in that category. It would be more historic buildings used for things like storage or the like.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

There wouldn't be a historic site?

[Michael Nadler]

It might be part of a complex of buildings that have historic sites, but it would be not a building frequented by visitors. That would be a very rare circumstance. We have one that is fairly well known locally. We encountered some challenges in the restoration of Sir John A. Macdonald's home in Kingston, so we've closed that to the public while we rectify that problem.

[Jean Yip, Liberal, Scarborough—Agincourt, ON]

It's worrisome that, first of all, there are the safety issues, and then there are also the revenue issues. If more of these historic places are not kept in good shape, it affects tourism and jobs. I hope there is a plan in place and that it is carried out.

[The Vice-Chair (Mrs. Alexandra Mendès), Liberal, Alexandra Mendes]

Thank you.

Now we go back to Mr. Kelly.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

In answers to some of the questions today, we've heard that each department here is quite confident, it seems now, that their data is there. You now know what buildings you have and what the current state is in each case, if I understood the answers correctly.

Mr. Berthelette, if I may bring you to paragraph 2.72, you point out that in the existing information—I guess this is specific to Parks Canada—you found all kinds of discrepancies in their data: pictures not matching the right building, texts that didn't match and contradictory type stuff. Are you satisfied that—at least by the fall, when Mr. Nadler said they will be 100% complete on their data cleanup—we will actually have accurate data on heritage buildings?

[Jerome Berthelette]

Madam Chair, I'm an auditor. I and my teams will be satisfied when we actually go in, take a look and see that it is in fact the case.

I am encouraged, though, by the statements from my colleagues at the table about their commitment to updating the database. I think that at some future point, given the importance of heritage properties to Canadians generally, it is highly likely that we're going to go back and take a look at the implementation of the recommendations by the department.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

Thank you.

Maybe I'll switch now and talk about the whole business of designation in the first place. It was mentioned in the report, “We found that the federal government focused primarily on designating heritage properties, rather than conserving them.”

That statement, I'm sure, is troubling to Canadians who would ask what the point is of designating something, other than just to allow for a photo op, and perhaps to allow people to feel good for a moment about the designation of something. When each day goes by and preservation doesn't occur until you wake up one day with a falling-apart building with a designation attached to it, that's really of no benefit to any Canadian.

How are we going to address this, where we connect the actual need to preserve with a designation?

I guess that's probably a question for Parks Canada.

[Michael Nadler]

My colleague Joëlle and I will answer it collectively.

Let me start by providing a preface that Parks Canada is now working with other federal departments to review the approach for designation, considering some of what you've observed here. That includes the ability to maintain and continue to support the heritage value of these buildings. That's across federal departments and multiple federal custodians.

Do you want to elaborate further?

[Joëlle Montminy]

A review of the directive on real property is under way right now led by Treasury Board, so changes could come to the designation process. You're flagging that these designations do not come with legal protection for the place. As my colleague mentioned, it is an honorific designation as it stands currently. In previous reports and audits, there's been a desire to have legal protection attached to the designation process. We've been looking into that and we continue to improve, whether it's through policy tools or exploring what would be involved in legal protection.

Going back to the point that was made earlier by colleagues, legal protection would require financial commitments.

[Pat Kelly, Conservative, Calgary Rocky Ridge, AB]

Thank you.

I only have time for one more quick question, if I may, to Ms. Thomas.

If one of your buildings is designated a historic site, does that potentially interfere with or complicate your operational use of a site? Could there potentially be a site that you might wish to either completely change, perhaps even to demolish if it's functionally obsolete?

[Jody Thomas]

As we noted, we have 292 buildings that are designated sites. It adds a level of complexity in what can be done to the building. It limits our ability to demolish. There's absolutely no doubt. We have old hangars, for example, heritage sites. They are part of Canadian heritage and they do matter. Our ability to use them is zero, and the ability to invest in them is very low.

I wouldn't say per se that there is a hindrance. There's no extra burden in how we use the individual building, but we have standards we need to follow as we update, as we refit, as we invest. The classic example is armouries; every town in this country has an armoury. They date back to World War I and World War II. We have to preserve the exterior. In many cases we have to use the same kinds of exterior finishes, the same kind of material. It adds to costs, absolutely, and we tend not to demolish those buildings because of their heritage nature. We maintain them. We have to continue their cost unless they're surplus to need, and then we look at whether a community would like to take them on.

[The Vice-Chair (Mrs. Alexandra Mendès), Liberal, Alexandra Mendes]

Thank you very much.

Now we go to Mr. Arya for five minutes.

[Chandra Arya, Liberal, Nepean, ON]

Deputy Minister, is there a need to revise the Treasury Board policy on management of real properties under which you have to look at all the properties that are more than 40 years old and designate them as heritage? Does it force you to designate some properties as heritage, or do you need some flexibility?

This only keeps on adding to the number of heritage properties. As a taxpayer, I'm concerned about spending money on the maintenance of these heritage properties. Some of them have to be maintained, I agree, but not all the properties that are being designated as heritage properties. The best example is the NCC has the Prime Minister's residence at 24 Sussex Drive, and if you ask me, tear it down and build a new one instead of spending money maintaining it.

Do you think there's a need for flexibility, or a change in this particular policy?

[Michael Nadler]

That suite of policies, the real property directive, is actually being updated now and we're working with the Treasury Board Secretariat on the exact question you have raised. To clarify, the designation is not automatic. What is automatic is a referral to this committee, this FHBRO committee that assesses the building for its heritage value.

[Chandra Arya, Liberal, Nepean, ON]

I'd like to hear from other deputies as well.

[Jody Thomas]

As was noted, the designation—in fact, all the management of infrastructures being reviewed by Treasury Board.... As the public accounts committee, you are aware that infrastructure is grossly underfunded and perhaps a problem across all departments. So, it is being reviewed to look at how we can consolidate, have departments share infrastructure, etc., rather than building new.

That said, the designation.... At 40 years old, an asset is often quite young in our portfolio. But there are multiple things that have to be considered, including its historic value. A headquarters building on a base that was built in 1950 probably isn't a historic building. It's just an older building. In our portfolio, it's in fact quite young. I think the policy could be reviewed, and is being reviewed. I think there are elements of it that need to be considered. As was stated, 40 years of use of a building is not really that significant in a lifespan, especially with new construction.

[Kevin Stringer]

I would agree. I don't know when we last looked at the definition of heritage. I think the point that you have made is that the number of heritage sites, buildings, assets, etc., is unlikely to go down over time. It just keeps getting added to. There are no additional funds to departments that are managing heritage sites. When it gets designated, it just gets designated. Then you have some of the challenges that the deputy minister just pointed out in terms of managing it.

That said, we get the significance of this. There are criteria to treat those assets differently. There are some different classes of heritage. I know that some of them are classified and some of them are just recognized. So, there's a greater level of “you can't tear this one down; you can't make changes to this”. If there were sort of a look at all of that; is it time to do that—

[Chandra Arya, Liberal, Nepean, ON]

I'm glad you brought that up. I think the Auditor General looked at all the heritage buildings in total, not the different classes that are there. If I'm not wrong, this policy on management of real property was last revised in 2006. I don't think that in 2006 they changed the definition or the criteria that have to be followed to designate any property as heritage.

Two of you, I think, did mention that you don't prioritize conservation over operations. I fully agree with that because operations are much more important. Maybe all of you can give inputs into the revisions that are taking place with the Treasury Board. I think we have to use the money more on the operations, in my view, than on conservation.

[The Vice-Chair (Mrs. Alexandra Mendès), Liberal, Alexandra Mendes]

If I may, have any of you looked or are you looking, now that you are reconsidering the whole policy, at what's being done in Britain, for example, because the National Trust is quite a success story? Has Canada been looking at something like this, or is it a possibility? Is it a consideration?

Mr. Nadler.

[Michael Nadler]

The National Trust model in the U.K. is basically a separate operating agency that has the capacity to fundraise. We have not looked at it in a significant way, to my knowledge. I haven't been informed of that kind of consideration by TBS to date. Parks Canada has looked at our colleague conservation organizations around the world. There are other models as well. While I agree that the National Trust is a compelling model, it too faces some challenges in that its iconic properties tend to draw a significant investment, but some of the lesser properties struggle under the model.

[The Vice-Chair (Mrs. Alexandra Mendès), Liberal, Alexandra Mendes]

I think the difference is that theirs are about seven or eight centuries old and ours are perhaps a century old. That would be a significant difference.

Mr. Christopherson, you have five minutes.

[David Christopherson, NDP, Hamilton Centre, ON]

Thanks, Chair.

Actually, that provides me with a good segue into where I was going, because I agree with Mr. Arya; this is unsustainable. We're kidding ourselves here. At some point, we have to decide whether we pony up the money and tax citizens to make sure these buildings are kept the way the policy says or we cut back on what we designate. Ms. Thomas gave the example of hangars. Looking at it from a practical point of view, you do have to ask if that is a top priority. Even in some experiences here on the Hill, we've seen some examples over the years. So I agree that this..and I think maybe that's what we need to do.

Let me say right up front that I agree that the bulk of the problem is money. I did not appreciate being told that this was the whole problem—I can come back to that in a minute—because the management here has been abysmal. That's the responsibility of the people sitting here, and your predecessors. The money part is ours. Either we make it a priority to make sure there's enough money there or we make sure that the work we designate we are going to fund—one or the other. I agree that at some point some government has to get on top of this and make some tough decisions about what we will do in terms of taxing and spending to keep our heritage alive. I think looking at Britain, which has a lot more experience than we do, is maybe a really good idea. At some point, we need to do that.

I want to draw your attention, Chair, to paragraph 2.21 on page 4. I won't read the whole thing, even though I was going to because it deserves to be read out, but I want to read the last sentence: “We found, however, that the regional representatives we met knew the number and condition of the heritage properties that they were responsible for.” That speaks to the staff and to the dedication of people in the public sector who, by and large, overwhelmingly really do care about what they're doing. The people who are involved in heritage care about these buildings. They become part of their extended family. I appreciate that the auditor put that in there, because that's part of the backstop of this. If this is working at all, it's because of the individual people on the ground as opposed to some of the management decisions we've been seeing.

I'm very pleased to see that the Auditor General is going to go back, because I do think we need to stay on top of this.

It's just getting worse and worse, so your holding them to account, and our knowing that you are going back in, is very helpful.

I'm running out of time, Chair, so I won't go to the actual page, but paragraph 2.35 talks about details being certified. Perhaps you will allow me to parenthetically ask the auditor what it means, exactly, that information has been certified. That's a fairly new expression for me in terms of these reports.

[Susan Gomez]

Are you talking about, in paragraph 23.5, when they need to certify to Treasury Board?

[David Christopherson, NDP, Hamilton Centre, ON]

Yes. What does the term “certifications” mean there?