Public Accounts Committee on Oct. 2nd, 2024

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

When were they delivered to the law clerk?

[Cassie Doyle]

Because of the thousands of documents that were requested—pretty well every document that's been produced in the organization in the last 20 years—they were produced and delivered in tranches. Every two or three weeks, another 13,000 documents were provided. They were provided over the course of the summer. I don't have the dates in front of me, sir, but we have complied with the request.

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

Thank you.

This is my last question: When was the last tranche delivered?

[Cassie Doyle]

I'm guessing, because I don't have that on the top of my head, but I would say it was in early September.

[The Chair, Conservative, John Williamson]

Thank you very much.

Mr. Drouin, I appreciate your patience and I appreciate your swapping turns. It has been noted by the chair. It's over to you for five minutes, please.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Thank you, Mr. Chair.

Ms. Doyle, I've asked you when these potential reviews by the third party would be done. You've mentioned a date in December 2024. Obviously there have been some mentions about it, and it's no news to anybody that the Ethics Commissioner has ruled on two cases specifically.

If we are to recover any monies, what would be the legal risk of your starting to send letters to those particular companies—I don't know; I'm still waiting to see the reviews—that may or may not have done anything wrong? Could those companies be a legal risk to the Government of Canada?

[Cassie Doyle]

We have received legal advice on the whole question of recovery. The project agreements that we enter into with the recipient companies are legal documents. They're binding documents. There needs to be a violation of some aspect of that document for us to recover any funds, but we have been forthright in receiving advice on that.

I think one of the risks with some of the very small companies is that to go after them and to recover the funds might actually cost more money, from a legal perspective, than it may actually bear for the Crown, so to speak, but we are receiving advice on that right now.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

I'm assuming that the legal advice you're receiving is to make sure that we get all our ducks in a row and to make sure that the third party review is completed before we make any conclusions, as my honourable colleague on the other side is making, with all the companies. They're not mentioning any companies. They're just saying that everything's been.... They're opining on this stuff.

I want to get to the bottom of this and get the truth. In order to get the truth, we have to let the investigation or this particular process—the other side seems to be against the process or against the recommendations of the Auditor General now, I understand—take its course.

[Cassie Doyle]

Yes, that's correct.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Once the reviews are completed, and you mentioned December 2024, there will be certain recommendations by the third party in terms of saying where you, as the board, could potentially recover some dollars if the contribution agreements were not respected in terms of achieving the said goals within the contribution agreements.

How long do you anticipate that this may take once the report is received and then the work completed that will be outlying in the next month or few months?

[Cassie Doyle]

It's a few months, yes.

We are certainly preparing the ground, because this is all connected with the restarting of funding. As I mentioned, we will not restart any funds where there's any finding of wrongdoing or serious non-compliance with the contribution agreement.

In terms of the timing on this one, we are operating in a really accelerated fashion. I can't give you an actual date of when that's going to happen, but we are preparing the ground, I can say, at this time.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Is the board thinking about potential scenarios, such as the one you already mentioned? If it's about recouping $1,000 or $10,000, and it will cost us $20,000 in lawyer fees, obviously it would be a bad investment to try to recoup those particular dollars. Are you setting a criteria sheet where, for instance, it makes sense to go after ABC Company because important dollars were involved or important breaches were involved from the contribution agreement?

Is the board starting to think about this right now? When you say you're preparing the groundwork, is that what you guys are thinking about?

[Cassie Doyle]

Yes, absolutely.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Okay.

I think I'm out.

[The Chair, Conservative, John Williamson]

If you have a brief question, I'll allow it.

[Francis Drouin, Liberal, Glengarry—Prescott—Russell, ON]

Thank you, Mr. Chair.

[The Chair, Conservative, John Williamson]

Thank you very much, Mr. Drouin.

Ms. Sinclair‑Desgagné, you have two and a half minutes.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Ms. Doyle, conflict of interest was clearly central to this whole situation.

We talked about the former board's conflicts of interest, but it's increasingly clear that there could also be conflicts of interest within the executive branch and among consultants, whether they are self-employed or consultants working at firms.

In June, the committee heard from Sheryl Urie, vice-president of finance at Sustainable Development Technology Canada.

She mentioned that they were already working with Deloitte, and that they had not yet ascertained whether Deloitte was going to audit eligible businesses, as has been mentioned several times. The answer we received did not clearly establish whether they were going to conduct a conflict of interest audit between Deloitte and the companies they audited.

I think it's very important to clear that up and to submit evidence to this committee showing that the verification was done between the firm that assesses whether projects are eligible and the companies that are assessed.

Can you provide that important piece of evidence to the committee, please?

[Cassie Doyle]

Thank you for the question.

Yes, I can confirm that there is a conflict of interest screen for any consultant working on the eligibility under these contracts. We can provide that as part of the information around this process.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

Is an audit even done when it comes to large firms like Deloitte, and not just independent consultants?

[Cassie Doyle]

Yes, every consultancy working on this, big or small, is subject to a conflict of interest screen.

[Nathalie Sinclair-Desgagné, Bloc, Terrebonne, QC]

All right.

How have you improved the process for logging declarations of conflict of interest, for example in board meeting minutes? We know that one of the main findings was that, in the minutes, there was no indication that a director had left the room after declaring a conflict of interest. How have you changed that process? Are the minutes now complete? Do board members read all the minutes to make sure they're complete?

[Cassie Doyle]

Yes, we have made a couple of improvements. One is having an independent recorder of the minutes, so a professional—a lawyer, in fact—who records the minutes of the board. At the start of each board meeting, we ask, “Is there any conflict of interest?” At times when we are looking at projects specifically, the projects are sent in advance so that there can be a screen.

Right now, this small, new board of SDTC has no conflicts of interest with any clean-tech company that has either been funded or is being proposed for funding by SDTC.

[The Chair, Conservative, John Williamson]

Thank you very much.

Up next is Mr. Desjarlais. It's your last turn, and you have two and a half minutes.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Thank you very much, Mr. Chair.

I want to thank Ms. Doyle again for being present here.

I want to continue with the Auditor General's report. We've spoken about paragraph 6.29, which is something I brought up at the very beginning of our discussion here today. It's what I believe to be an important process to recover funds. You've been asked several times by my colleagues about that process.

I would request that, if you can, throughout your continued review of that process, you regularly update this committee when those new criteria are implemented so that we can review instances where there could potentially be some persons who are deemed ineligible under your new rubric. Those persons, of course, in my mind, should be subject to the recovery of taxpayers' money. That's money that's owed. If they were not eligible under the former process and are still not eligible under the new one, we should know about it. Canadians should know that we're in the process of recovery.

I want to move to section 6.26, which is another recommendation partially agreed to at the time by SDTC. It's in relation to a recommendation made by the commissioner of the environment and sustainable development Canada that SDTC “should improve its challenge function over projected sustainable development and environmental benefits.”

We've seen throughout the process of the audit that some projects—shockingly, to many Canadians, including me.... People were dismayed by the fact that projects that didn't have any real benefit for the environment, particularly through innovation, and wouldn't have contributed to the reduction of greenhouse gases, for example, received funding. The purpose of SDTC was to ensure innovation toward economic and environmental improvement, and there were instances discovered by the Auditor General when that failed to happen. It did not happen. It makes sense that the environment commissioner is asking for improved challenge functions.

How do you respond to section 6.26 of the Auditor General's report?