Public Accounts Committee on Oct. 30th, 2024

[The Chair, Conservative, John Williamson]

Mr. Bains, the floor is yours if you'd like to answer.

[Navdeep Bains]

Again, I've answered that question, and I'll answer it again. All individuals applied for the roles, including Ms. Verschuren.

[Jake Stewart, Conservative, Miramichi—Grand Lake, NB]

Come on, Mr. Chair.

[The Chair, Conservative, John Williamson]

Thank you very much.

We're moving on now to Ms. Khalid.

You have the floor for five minutes.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Thank you very much, Mr. Chair.

I'll start by highlighting that when I was first deciding whether or not to run in politics, I had to be asked a whole bunch of times. In fact, statistics show how many more times women need to be asked in order to fill these leadership positions. You know, there is the imposter syndrome that a lot of women deal with, including me, so I understand and appreciate why anybody would be encouraging women to fill important board positions and leadership positions, regardless of whether it's this situation or any other across our country.

I remember when Mr. Bains was a minister. He put forward a really important bill with respect to ensuring that there was equity within corporate boards. That bill that he put forward was one of my favourite pieces of legislation. Thank you for that, Mr. Bains.

Here is my question: Can you walk us through specifically what the process is? What does the process look like when somebody is going to become a part of a board? How does that process work? Then at what point does ministerial intervention or participation happen?

[Navdeep Bains]

The process is very open, and it was established in 2016. All appointments were public, and individuals actually had to apply.

In many instances, if, after applying, individuals meet the criteria, they would most likely be called for an interview, according to what the PCO official said. Those interviews are conducted.

Based on those, recommendations are made through an advice letter from the PCO to the respective ministers and their departments on those positions that the people are applying for.

Then the minister determines and makes a recommendation, which is called a Governor in Council recommendation. That's essentially the process.

It does engage the PCO, and it is open. It does encourage more people, and not fewer, to apply. There is a rigorous vetting process—and it is my understanding that the PCO official took the committee through that—that looks at individuals meeting the criteria for the different jobs and positions that are publicly made available.

Again, all these positions are public, and my understanding is that every single person has to apply.

[Iqra Khalid, Liberal, Mississauga—Erin Mills, ON]

Thank you very much for clarifying that.

Mr. Bains, given that you've come to this committee twice now to talk about the exact same issue, do you have any regrets about the situation at SDTC? Do you have regrets knowing that this whole affair has had severe consequences on an industry that relies on public funding to de-risk investments in that sector?

[Navdeep Bains]

The policy objectives are very clear, and you're right that the clean-tech sector is so important to Canada. The jobs that it creates, the innovation that it spurs, the entrepreneurs that it supports—those are the policy objectives, and you want to make sure that those policy objectives are advanced to deal with issues around productivity and around growth.

As you've indicated, it is deeply disappointing to see that a number of companies may not receive the funds at the appropriate time to scale and grow due to a number of issues that have been raised here. I think, as someone who believes in Canada, who believes in Canadian companies and who believes in our ability to succeed, that it's important that we have a vibrant and well-funded clean-tech sector.

My understanding—and I believe other witnesses have spoken to this—is that Sustainable Development Technology Canada played an important role in providing that funding for these companies and supporting Canadian entrepreneurs. I think that good work should not be underestimated, because we're in a global race for these jobs, for these technologies and for scaling these technologies. It's important now more than ever, when we deal with issues around productivity, that we find ways to support our Canadian entrepreneurs.

[The Chair, Conservative, John Williamson]

Thank you very much. That is the time.

It's now over to Ms. Sinclair‑Desgagné for two and a half minutes.

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

Thank you, Mr. Chair.

Mr. Bains, not only did Mr. Noseworthy attend the board meetings—his name appears in the minutes of every meeting—but he was also very involved, particularly in Ms. Verschuren's appointment. As Ms. Lawrence stated, Mr. Noseworthy was the one who contacted Ms. Lawrence, the president and CEO of SDTC, to tell her that Ms. Verschuren was going to be the new chair.

Were you aware of those conversations?

[Navdeep Bains]

This is the first time I've heard of such a process taking place.

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

Does it strike you as normal that the assistant deputy minister would be the one to contact the president and CEO of SDTC to let her know who the new board chair was going to be? Was that a common process you saw during your five years as minister?

[Navdeep Bains]

Just to clarify, are you saying that the assistant deputy minister reached out to the current chair to say who the new chair was?

I just want to clarify. I apologize.

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

No, he contacted Ms. Lawrence, the president and CEO at the time. He was the one who informed her who the new chair was going to be. A few days later, Ms. Verschuren was already on the board. That's what Ms. Lawrence said.

[Navdeep Bains]

There probably is a process, through a Governor in Council appointment recommendation, once passed through cabinet, of informing key stakeholders. I assume letting the CEO know would be part of the process. I just don't know the sequence or timing that you're referring to.

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

They were calls in which Ms. Lawrence flagged that she had concerns regarding conflicts of interest because she knew Ms. Verschuren and was aware of the more than apparent potential conflicts of interest her appointment could mean. According to Ms. Lawrence, she actually mentioned those concerns to Mr. Noseworthy.

I imagine Mr. Noseworthy never discussed those concerns with you or the deputy minister.

[Navdeep Bains]

As I indicated, when it came to Ms. Verschuren or any of the other candidates who were presented to me, they had to go through a vetting process. I had enormous confidence in that process to determine what the names would be, and that's how I approached my position on making a GIC recommendation.

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

The president and CEO of SDTC told the assistant deputy minister that she had serious concerns. You didn't hear about any of that. The assistant deputy minister simply kept it to himself because he was friends with Ms. Verschuren. That would definitely be understandable.

Did I get that right?

[Navdeep Bains]

What I can say—and it's on the public record as well—just to make sure we're on the same page, is that when Ms. Verschuren did want to apply or after she applied, she did engage with the conflict of interest commissioner to get guidance on whether she could proceed.

To your point, if such issues were raised, my understanding is that those issues were addressed in her approach with the commissioner to get clarification on whether she could pursue this position. My understanding, based on the testimony that's been presented, is that she did get clearance.

[The Chair, Conservative, John Williamson]

Thank you.

Up next is Mr. Cannings.

You have the floor for about two and a half minutes.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Thank you.

I just want to clarify in my head the whole of what we're hearing here today.

It seems, Mr. Bains, that what you're saying is that there was no role for you to play in even knowing about a conflict of interest, let alone considering it—which strikes me as odd—and that all those discussions would have taken place from the deputy minister on down in your department and within the board itself.

Is that correct?

[Navdeep Bains]

In my opening statement, I mentioned that there were over 100 Governor in Council appointments. Those appointments were made through the recommendations given by the PCO.

My understanding is that all such issues were looked at through the vetting process and that ultimately any individual who did go through that process had an obligation to follow the Conflict of Interest Act. I believe that when you're dealing with such a number of appointments over a period of time, the process needs to be clear in terms of vetting the individuals, and then rules also have to be clear on how individuals should conduct themselves.

I firmly believe the onus is on the individuals to make sure that they comply with the act.

[Richard Cannings, NDP, South Okanagan—West Kootenay, BC]

Getting back to what you might hear as a minister, I can understand that your ministry was one of the larger ones and perhaps a little complex, but you had a deputy minister who was hearing from people like Mr. Noseworthy about things.

SDTC was, I would suggest, a very large and important project under your ministry. It wasn't some minor thing way down low. SDTC dealt with a lot of money and lot of important projects. I would say it was one of the flagship projects of your government in terms of trying to deal with climate challenges, one that you would be, I would hope, very proud of and that you would hear about from your deputy minister on a regular basis as to how all that was going.

Here we have an assistant deputy minister sitting in on the board meetings and hearing things that the Auditor General found concerning, yet your deputy minister never reported to you. I don't know how often you spoke to your deputy minister. I would hope it was on a daily basis, but you never heard anything regarding these issues from the deputy minister.

[Navdeep Bains]

To answer the two questions that I believe you have posed, first, in the clean-tech sector, Sustainable Development Technology Canada and the role that it played in providing capital were important, again for the reason I stated before with another member who asked me about the clean-tech sector.

Second, I did speak with my deputy minister on a regular basis. The issues that you are highlighting were never brought to my attention.

[The Chair, Conservative, John Williamson]

Thank you. That is your time.

I gave you a little bit more to make up for your opening. You were short there and you will have one other opportunity, Mr. Cannings, as well. There will be one more round after this.

Mr. Nater, you have the floor for five minutes, please.