Public Accounts Committee on Sept. 3rd, 2024

[Larry Brock, Conservative, Brantford—Brant, ON]

Thank you, Chair.

Thank you, Mr. Davies and Mr. Lisk, for your attendance today.

I listened very carefully, Mr. Davies, to your opening statement. The hallmark, from my perspective, is the desire to restore public confidence and trust.

It will be a large feat to accomplish, but it's no small wonder that you make that statement, because after nine years of Justin Trudeau and his government, one of the most ethically challenged and corrupt governments this country has ever seen, millions of Canadians are skeptical when they hear senior civil servants uttering such things as, “Trust us. We're going to restore confidence in the program. We're going to restore the oversight that should have been there in the first place.”

This arm's-length corporation, SDTC, was responsible for essentially doling out free money to the tune of almost $393 million to companies that were conflicted. It's no small wonder that the assistant deputy minister of ISED uttered the phrase, “It was free money”, and that this “was almost a sponsorship-scandal level kind of giveaway”. Public confidence is shattered when it comes to the ability of this government to distribute taxpayer monies in a prudent and ethical manner.

If I understand you correctly, the current SDTC organization is under the umbrella of NRC. Is that correct?

[Mitch Davies]

Mr. Chair, it is not.

[Larry Brock, Conservative, Brantford—Brant, ON]

It is not.

[Mitch Davies]

No.

[Larry Brock, Conservative, Brantford—Brant, ON]

Are they with IRAP?

[Mitch Davies]

Mr. Chair, the SDTC still exists as a foundation. It has an interim board. Its employees are still employees of the foundation.

[Larry Brock, Conservative, Brantford—Brant, ON]

Right.

[Mitch Davies]

They're not part of the NRC.

[Larry Brock, Conservative, Brantford—Brant, ON]

Who's supervising? Who's providing that daily supervision and monitoring of granting monies to these start-up green companies? Who is doing that?

[Mitch Davies]

Mr. Chair, I believe Paul Boothe was here in previous testimony. He's one of the interim board members. I believe he's the chair. The interim board, as the board of SDTC, is supervising the activities of the foundation.

[Larry Brock, Conservative, Brantford—Brant, ON]

We have one chair and two directors doing all the supervision. Is that correct?

[Mitch Davies]

As I understand it, Mr. Chair, there are three interim board members. The management of SDTC runs the organization at this time.

[Larry Brock, Conservative, Brantford—Brant, ON]

All right. They are providing the oversight on behalf of the federal government, correct?

[Mitch Davies]

Mr. Chair, as I understand it, there's also a contribution agreement—

[Larry Brock, Conservative, Brantford—Brant, ON]

I understand that.

[Mitch Davies]

—between the department and—

[Larry Brock, Conservative, Brantford—Brant, ON]

NRC is not providing any oversight.

[Mitch Davies]

Once we have taken on responsibility for the programming—

[Larry Brock, Conservative, Brantford—Brant, ON]

At the moment, NRC is not providing oversight, correct?

[Mitch Davies]

Mr. Chair, I would say that's accurate, yes.

[Larry Brock, Conservative, Brantford—Brant, ON]

IRAP is also not providing oversight.

[Mitch Davies]

We'll be involved in that role once the transition has taken place.

[Larry Brock, Conservative, Brantford—Brant, ON]

The minister, in his statement on June 4, 2024, talked about the NRC providing a level of oversight. He said:

These actions were rooted in our commitment to transparency, accountability, and upholding the highest standards of integrity.

He also said:

As a Government of Canada organization, the NRC is subject to rigorous and stringent oversight of its personnel and finances. This structure will help rebuild public trust while increasing accountability, transparency and integrity.

He actually misled Canadians to believe that you're providing that extra layer of transparency and accountability, which is the furthest thing from the truth. That's not happening right now. You're going to move toward that in 2026, but money is being channelled right now by one board chair and three board members and the current SDTC organization, because no one was fired. The existing board of SDTC either resigned in shame or due to public pressure. The current board chair was found guilty of two ethical violations by the Ethics Commissioner. All of the directors resigned in shame.

What confidence can Canadians have that between now, in 2024, and in 2026, when the new corporation takes over, there will be any accountability and any transparency? How are Canadians supposed to feel confident, sir, after hearing my exchange with you right now? What confidence can you give them?

[Mitch Davies]

Mr. Chair, just as a clarification, the transfer that will be undertaken will be done within this year. We hope that if we can do it earlier, we will.

The second thing is that prior testimony was given here by the department and an SDTC interim board member who spoke about the process they're undertaking. They've accepted the Auditor General's findings and they're reviewing all the files with that in mind.

That interim board was put in place because of the importance of public trust and the need to establish leadership at SDTC right now to do that work, and to do that work before it's transferred to the NRC in the coming year. That transfer will take place, hopefully, in the fourth quarter of this fiscal year, and we're endeavouring to make that happen.

In the interim, the testimony that's been provided here before by the department and the interim board has been about their acceptance of those recommendations and about taking them fully into account in the review they're doing right now, but I'll leave them to speak to how they're operating.

[The Chair, Conservative, John Williamson]

Thank you very much.

I'll bring it now to Ms. Khalid. You have the floor for five minutes, please.