Public Accounts Committee on Nov. 2nd, 2023

[Andrew Hayes]

That's my understanding, yes.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

That's right. Immediately, then, they froze funds so that there would be no further allocations made in the meantime, while these things were being investigated. Is that right?

[Andrew Hayes]

I believe that what was suspended were new project approvals, but that existing funding agreements would still be—

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

—honoured. That's right.

I presume that, as a result of that report, that's how your office then decided it was appropriate to do an audit, but I believe that your audit isn't going to look at HR issues because initially you feel that's out of your area, but it could be reviewed down the line, or....

[Andrew Hayes]

We're concerned that the HR practices of the organization might not be within the mandate of our office, but we are still determining our scope. We're going to go as broad as we can.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

I believe ISED has also indicated that there will be a parallel third party investigation that's going to look only at HR practices. It's going to be going on at the same time as you're doing your audit.

Is that correct?

[Andrew Hayes]

I believe there was an announcement or a decision at the end of October about an independent fact-finding exercise regarding human resources allegations. I believe that it might have been something that was approved by the SDTC board, but I'm only going on second-hand information at this point.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Okay.

The period of your audit is going to go from 2021 forward initially.

[Andrew Hayes]

We're still determining that.

What I can say is that we'll start with after 2017. What date we start with is still to be determined, but we will look a few years back at the very least.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Getting back to that environmental commission report of 2017, at that time, the finding was that SDTC had good processes in place regarding the awarding of funding. There were no red flags or any indication there that anything was out of order.

[Andrew Hayes]

That's right.

I think we made one recommendation to SDTC, but it wasn't related to its approval processes.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Like you said, in order for you to come out that positively, you had to be pretty confident that things seemed to be in pretty good order.

[Andrew Hayes]

Yes.

Thank you for the opportunity to clarify my answer. We're always confident with our reports and our findings. We are very careful.

I wanted to emphasize the point that when we report something positive to Parliament, it's because it's deserved.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Yes. It appears that any problems that may have arisen have been reasonably recent, because they didn't have a history of having problems in this department with that.

[Andrew Hayes]

My presumption is that we will go in there and look at the last number of years. If there's reason to believe that there's anything before 2017, we'll look at that, too. However, we'll start from the perspective that our report in 2017 provides a line in the sand from which we would move forward.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

I know that there's a lot of concern because SDTC is a separate organization and is not governed by the same whistle-blower protection that government departments are. There is concern in the case of those employees. However, I believe that ISED has said that current and former employees will be able to freely speak with the law firm that's investigating, without violating any applicable settlement agreements or non-disclosure agreements.

[Andrew Hayes]

With regard to that, we would be asking similar questions when we do our preliminary scoping and audit work.

If you just give me an opportunity to make one statement....

The importance of whistle-blowers and their ability to speak freely without fear of reprisal is fundamental. Otherwise, you lose the transparency and the ability to hold organizations to account. I would hope that all efforts that can be made to protect these whistle-blowers are going to be taken by all organizations involved.

[Valerie Bradford, Liberal, Kitchener South—Hespeler, ON]

Yes. That's fine.

I don't have any further questions.

[The Chair, Conservative, John Williamson]

You're about out of time anyway. If you did have one, it would have to be a very quick one.

All right.

Ms. Sinclair-Desgagné, you have the floor for two and a half minutes, and I'll add the 20 seconds that Mr. Desjarlais didn't use.

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

Perfect, thank you very much.

Earlier, we were discussing the difference between transparency standards for departments and those for Crown corporations or not-for-profit organizations such as Sustainable Development Technology Canada. You told me that you are indeed mandated to review funding agreements.

That said, you carry out audits once a year as far as departments are concerned, but less frequently when it comes to Crown corporations and not-for-profits. I believe those audits are carried out every three to six years, or even every seven years. Can you confirm that?

[Andrew Hayes]

We conduct special reviews of Crown corporations every ten years. However, we may perform other audits or special reviews more frequently.

As for departments, they are part of our audit selection process every year. We look at all programs and all risks. We also use information from our financial statement audits, in the context of the Public Accounts of Canada.

So we use all available information to decide which audits we undertake.

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

In the case of Sustainable Development Technology Canada, on the other hand, the last audit took place in 2017. That was six years ago. You're conducting another special review of the foundation, for which your report will be published in 2024, so seven years later, but you might not even have done that, were it not for the whistleblowers.

If the government itself managed taxpayers' money within departments, you would look at the figures annually, which would be much more desirable in terms of transparency, but also in terms of accountability.

In the government's new policy of sending hundreds of millions of dollars, if not billions of dollars, to Crown corporations that are not subject to the same standards of transparency and are not audited as often, I perceive a contempt for the taxpayer who wants to know where their money is going.

As a Member of Parliament and a member of the Standing Committee on Public Accounts, I think it's a real shame that we can't look at the way our money is spent in the budget more often. As I've pointed out on a few occasions in the House, we're seeing more and more taxpayers' money being sent without transparency to agencies like Sustainable Development Technology Canada, or Crown corporations like Export Development Canada or the Business Development Bank of Canada, so we don't have access to the kind of detailed information that departments are required to provide.

In fact, that's why we asked Treasury Board to review the accounts and transparency requirements.

In this case, I can see that there was a problem, which could likely have been avoided if Innovation, Science and Economic Development Canada had managed the money itself.

[The Chair, Conservative, John Williamson]

Your time is up. Thank you, Ms. Sinclair-Desgagné.

Mr. Desjarlais, you have the floor for two and a half minutes, please.

[Blake Desjarlais, NDP, Edmonton Griesbach, AB]

Okay, and I have another question, if I can ask it without reducing my time: Do we have one more round after this?

[The Chair, Conservative, John Williamson]

My intention, subject to the will of the room, is to hear from you and the Conservatives, to end with the government members, and to then move on to the next business.