Public Accounts Committee on Oct. 5th, 2023

[The Chair, Conservative, John Williamson]

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

[John Nater, Conservative, Perth—Wellington, ON]

Thank you, Chair.

I'm happy to provide the Auditor General with 30 seconds or so to respond to Mr. Desjarlais' question.

[Karen Hogan]

Thank you very much.

When you look at how six out of 10 households in first nation communities don't have access to Internet, I don't think any of us appreciate what that really means. We take it for granted. It is a big deal.

As for what I think needs to be done, there are so many reports we look at that see differential treatment for indigenous communities. I think there's true spirit in trying to do something different in the spirit of reconciliation and not just trying to apply the same approach and hoping for a different outcome. I would like to see the federal government do something really transformative in how it approaches discussions and engagement on all of these files when they touch indigenous communities.

[John Nater, Conservative, Perth—Wellington, ON]

Thank you very much.

Mr. Kennedy, my question earlier was about providing more granularity and more specificity for connections by the end of this year. Can you provide that by province, and within Ontario by county?

[Simon Kennedy]

We'd be happy to come back. I think we can provide it by province. I'll have to look at counties, but we definitely have more granular statistics. We'd be very happy to come back and try to provide as much as we can.

[John Nater, Conservative, Perth—Wellington, ON]

I would request that by county, sir, because rural Perth County is much different from other regions of this province. I think it's incumbent on you to provide that breakdown so that we can see a picture within our province and within the whole province, frankly.

Mr. Kennedy, the connect to innovate program provided zero project funding for southwestern Ontario, despite southwestern Ontario having about 10% of the underserved Internet population in the country. Why did connect to innovate provide zero dollars in funding to southwestern Ontario?

[Simon Kennedy]

I'll have to come back. I apologize. I am a little less familiar with the intricacies of that program, but I'm happy to come back and provide an answer.

It was a different sort of program. To the honourable member's question, it was providing funding for backbone Internet, like the large pipes. It wasn't actually connecting individual households. That may account for the way the money was spent, but we'd be very happy to provide a more comprehensive answer.

[The Chair, Conservative, John Williamson]

You have 40 seconds, Mr. Nater.

[John Nater, Conservative, Perth—Wellington, ON]

To that I would say that you can't really connect individual households if you don't have that backbone. Frankly, in 2023 the fact is that rural Ontario and rural Canada are still lacking. You admit the fact, and I accept it, that 71% isn't good enough, frankly. The fact is that, by the end of 2023, we will still be at only 71% of rural Canada. As Mr. Desjarlais mentioned, it is even lower for indigenous communities, which is completely unacceptable, despite the billions being spent. We can highlight the billions upon billions that are spent, but if we don't have actual results, then I think it's highly unfortunate.

I'll leave it there. Thank you, Chair.

[The Chair, Conservative, John Williamson]

Thank you, Mr. Nater.

Mrs. Shanahan, you have three minutes, please.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

Thank you, Chair.

First of all, I'd like to thank the witnesses for being here. I think we have explored quite a few of the gaps and areas for future improvement in this program. I'm glad to hear from colleagues on both sides the agreement that this is very important. Indeed, continued investment needs to happen. Continued collaboration needs to happen for us to reach our goal of 100% across the board.

However, you did allude, Mr. Kennedy and other witnesses, to the bottlenecks and supply chain challenges. Over the past few years, of course, we've been seeing severe weather events related to climate change, with forest fires in B.C. and hurricanes in the Atlantic. These events also must have had impacts on broadband projects.

Can you tell us approximately what percentage of projects have experienced delays due to climate-related events and what's being done to mitigate those delays?

[Simon Kennedy]

There have been some projects that have experienced delays. I'll have to come back with maybe a more precise answer. Again, maybe just to emphasize what I'd said before. At least to date, it is not our judgment that those kinds of delays are going to result in the targets that have been laid out by the government not being hit. We're quite confident that, notwithstanding some of the delays, we're on track to actually hit the connectivity targets that we noted previously.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

Thank you. That's very good to hear.

Maybe you can speak to the flexibility of the UBF in dealing with these kinds of obstacles. Again, I guess I'm looking for that collaboration that we need to have from all levels of government, as well as the public and private sectors.

[Simon Kennedy]

A lot of these projects are major infrastructure projects. They have to go through a measure of due diligence before we would recommend the government put significant tax dollars into them.

However, there are various mechanisms built into the way in which the program operates that are designed to try to move things along. For example, when you get the provisional approval—like, your project looks good—we still have to get the final detailed contracts signed. We need to see all the engineering diagrams, that sort of thing, but when you get provisional approval, you then have the right to actually get going, and you're typically able to spend up to 30% of the value of the project and get reimbursed.

Is it 30%?

[Éric Dagenais]

Yes, it was increased.

[Brenda Shanahan, Liberal, Châteauguay—Lacolle, QC]

The provisional approval comes from whom?

[Simon Kennedy]

It comes from the department. Once the government has looked at your project and says that it looks like it's pretty good, you have to negotiate a detailed contract, a legally binding contract. Once you get the provisional approval, you have enough confidence to get going and spend up to 30% of the cost of the project, knowing that, when the final contract is signed, we will honour that. It's the ability to kind of get going before you get the final contract in place.

In the case of the rapid response stream, you can actually spend up to 100% of your allocation. If you were given provisional approval that the project is good, then, provided you are willing to maybe take on some risk, you could actually get going, knowing that once the contract is signed, even if the project at that point were complete, the government would reimburse you.

It's not a perfect solution, but it's an example of efforts to try to make sure that, frankly, the kind of adjudication that's needed sometimes with these very complicated projects doesn't necessarily slow down the ability to get going and start putting shovels in the ground.

[The Chair, Conservative, John Williamson]

Thank you very much.

I just have a few questions, and I'll endeavour to get you out of here as quickly as possible.

Mr. Kennedy, you've married a Maritimer, so you'll know that we can bristle when success is pointed at central Canada. We should perhaps just ape them, but it's not always feasible. I am curious to get your thoughts as to why New Brunswick and Nova Scotia don't have agreements with your department. Both provinces have shovel-in-the-ground projects, but they also really embrace the Starlink network.

Has that been an issue? Is your department reluctant to go the Starlink route? Has that been part of the problem? What do you think is holding up this agreement with my province, as well as the province of Mr. Blois, who's not here today, Nova Scotia?

[Simon Kennedy]

I'll turn to Mr. Dagenais who's been involved directly in the conversations.

[The Chair, Conservative, John Williamson]

Please, yes.

[Éric Dagenais]

We don't have any issue working with provinces who work with Starlink. In fact, Quebec is probably the province that has the most citizens on Starlink—government-funded. They were the first ones we worked with. That's not an issue.

At this point—and this is me speculating of course, which may be dangerous—we have plans to connect 100% of Nova Scotians and New Brunswickers. If the plans are there, and if the project's chosen and funded, perhaps the need to come to the table has passed because we have said that we're going to fund 100%. Whether we have an agreement with you or not, we're funding 100%. We want to connect everyone.

[The Chair, Conservative, John Williamson]

Thank you. I appreciate that. It is encouraging.

I will reiterate, though, a point that Mr. Stewart made, which is something I hear all the time. We can see the end of the line from the household and, for some reason, we're just not getting that breakthrough.

I recognize that rural Canada is hard, but it's an ongoing frustration for lawmakers. That is, I think, why you're hearing some of that frustration today. I appreciate your response to that and being aware of it.

I have two quick questions from our analysts as well.

The first is for the CRTC, please. Since the—

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

I'm sorry, Chair. I have another meeting and—

[The Chair, Conservative, John Williamson]

You're welcome to walk away. There are no votes, and I've lost a member here. This is for the analysts.

You can call for a vote, but I'll be very quick otherwise.

[Kelly McCauley, Conservative, Edmonton West, AB]

We won't do anything, if you want to....