Public Accounts Committee on Nov. 4th, 2024

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

I'll turn to Ms. Hogan.

Just picking up on my colleague Ms. Khalid's questions, do you have any expectations with regard to the outcomes of this project review?

[Karen Hogan]

Are you talking about the recommendation where we asked the foundation to review all of their projects? I expect they will identify other organizations that were ineligible and that they would then take those we identified as well as these other organizations and make a decision with Innovation, Science and Economic Development Canada about whether or not any funds need to be recouped and, if not, make that very clear and transparent to Canadians.

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

Thank you.

Mr. Rahme, you've taken the top job at SDTC after long-time CEO Leah Lawrence resigned amid scrutiny of SDTC management and governance. You've been the VP of investment since 2017. Can you speak to this previous role in the organization?

[Ziyad Rahme]

As VP of investments, my primary role was to manage the process related to receiving applications, screening those applications, and then, for those that would make it through the initial screening, conducting the detailed due diligence process, receiving proposals and then working with staff to synthesize those recommendations and bring them forward to the project review committee for a review and, for those that passed, recommendation ultimately to the board for approval for funding.

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

Have you made any internal changes since being appointed interim CEO?

[Ziyad Rahme]

I was appointed acting CEO, as I just said in my opening remarks, in November 2023. I had two top priorities at the time. One was to support staff in ensuring that they had a very safe and healthy work environment.

We were very focused on implementing all of the recommendations that were provided to us by ISED in the management response and action plan, many of which are now implemented and running in terms of enhanced processes, etc. Of course, the third priority was ensuring that the organization fully co-operated with the examinations and reviews that were under way through that period of time.

Otherwise, we did not make any substantial changes to the organization other than, again, implementing all of those recommendations that came through. Since June, in addition to all of that, we have been supporting the new board in implementing their mandate as well as all of the recommendations provided by the Auditor General.

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

Okay.

We know that the revised contribution agreement between ISED and SDTC mandates important changes within the organization, notably strengthening the conflict of interest provisions. Can you speak to how you're implementing change within the organization and the link to the revised contribution agreement?

[Ziyad Rahme]

Thank you, Mr. Chair.

Many of the changes to the contribution agreement would have revolved around enhancing a lot of the oversight provisions. You mentioned, for example, conflict of interest. There would have been enhanced reporting mechanisms from SDTC to ISED regarding all aspects of the contribution agreement, better clarity on ISED's role at board meetings and enhanced oversight of the auditing functions.

Many of these would have flowed from the management response and action plan. For example, on conflict of interest reporting, we have enhanced all of our processes and we've worked very closely with an ethics adviser we brought on board in October 2023 to enhance and upgrade all of our processes around conflicts of interest and the reporting of those conflicts over to the ministry. That's one example.

Again, we have a series of reporting we've put in place for all aspects of our operation that we report back to ISED.

[The Chair, Conservative, John Williamson]

Thank you.

That is your time.

As I said, I'm going to suspend this meeting for 15 minutes. We'll come right back at 12.30.

Thank you.

[The Chair, Conservative, John Williamson]

I call this meeting back to order.

We'll get through two more rounds, as we've been doing.

To kick things off, Mr. Perkins, you have the floor for five minutes, please.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Thank you, Mr. Chair.

In this round, Auditor General, I'll be posing questions to you and your team, if that's okay.

In your opening statement, you mentioned that the documents you have in the government's production order are all documents that departments have, so in essence those departments can and should be turning those over as part of the production order. Is that correct?

[Karen Hogan]

We have documents from many different entities, but the bulk of what we have in our file is from either the foundation or Innovation, Science and Economic Development Canada. So yes, Parliament should be receiving government information from the government.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

With most of those documents, as I understand it, over 10,000 pages have been redacted, not complying with the order, and ISED is still going through the documents. They've done a couple of rounds, and they have others.

As I understand it from reading the law clerk's letters, the order came from the Privy Council Office to say to filter the responses through the Privacy Act and the Access to Information Act, which were not part of the House's order. That's why we're at the stalemate right now where the government could produce the documents unredacted. The House's order didn't say redact them or filter them through these acts. They could provide it and we could get on from the stalemate.

Your office was a recipient of that direction from the Privy Council Office. Could you tell me who in the Privy Council Office wrote that letter?

[Karen Hogan]

I have received absolutely no direction from anyone at the Privy Council Office. My desire to comply with the government security policy, which is a requirement of my act, means that I have to go to ISED and say, “You own this information. How are you treating it?”

I think this dispute between the government and Parliament is one where the government needs to answer for why it is refusing to hand over or redact information. I used the analogy before that I'm a caboose on this bus. I need to let them go first. Then I need to ask them to help me treat the information they gave me in the same way, because it is their information I'm handing over, not my information.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Right. So they're communicating to you to redact documents in a way that was not part of the House order, I would assume, primarily through ISED and SDTC, who are both on the list from the law clerk as censoring the documents.

[Karen Hogan]

They are not communicating to me. I have been trying to communicate with them to get assistance. As I mentioned, we've had about a dozen conversations. It's really up to them to tell us what they're doing to the documents.

I don't know if Andrew wants to add more.

[Andrew Hayes]

Yes.

Since June we've had about 12 conversations with ISED officials to figure out the protocol as to how to treat these documents. We will end up getting direction from ISED, but as you mentioned, that will be on the basis of the decisions they have made on those documents.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Which ISED officials are they? Could you table the list with the committee?

[Mathieu Lequain]

The main contact is the chief audit executive.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

For the department.

[Mathieu Lequain]

Yes.

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

Thank you.

You're aware that in the Privacy Act, which was cited as a reason to exempt or redact these contracts or these documents, section 8 says that authorized bodies are exempted who have the power to redact documents. That's section 8 of the Privacy Act. In fact, I think the Auditor General Act has a similar provision. It says that if you're an authorized body who has the power to order documents, you're exempted from the Privacy Act.

Are you aware of that?

[Karen Hogan]

I will give Andrew the option to jump in on this, if he wants.

When I received a request from this committee to hand over additional information about the 90 cases of conflicts of interest, I actually had a conversation with the Privacy Commissioner about paragraph 8(2)(m), I think, in the Privacy Act. It is not in the Auditor General Act. I explored with him what it meant and the will of Parliament. Then it is up to me, as the head of the organization, to weigh whether the will of Parliament supersedes an individual's right to privacy. That's basically what paragraph 8(2)(m) is asking for.

When I looked at most of the information I provided, it was information that you could find in the public domain. Hence, I provided that table to the committee and cited that letter, but I also felt it important—

[Rick Perkins, Conservative, South Shore—St. Margarets, NS]

I'm just short on time.

[Karen Hogan]

—to let everyone know I was handing over that information.