Public Accounts Committee on Oct. 2nd, 2025

[The Chair, Conservative, John Williamson]

Thank you.

Up next is Ms. Kusie for five minutes, please.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you, Mr. Chair.

Madame Boudreau, in budget 2021 TBS received $5 million over three years to implement 119 recommendations from the horizontal fixed asset review process. To do this, you created the centre of expertise for real property, which has since been dissolved. Prior to being dissolved, the centre implemented only 18% of its recommendations, which comes out to a stunning $238,000 per recommendation implemented. Are you satisfied with this metric?

[Samantha Tattersall]

I think what's really important, just to start with, is that most of the recommendations were for departments, and our role was, really, in the leadership, coordination and implementation of those recommendations. A lot of the recommendations have a very long tail, so you don't just, in three years, improve real property. It's a long-term proposition.

One thing I would like to highlight is that, since the dissolution of the centre of expertise, we haven't stopped working at TBS. I'll give you an example—and I think it's one that's relevant for this committee because, as we talk about housing and using federal lands, we look at how we can dispose of our federal lands to support that, and we've made changes to our policy to help facilitate the disposal. For example, now if you want to dispose to CLC, you can dispose at a higher level. We've reduced the due diligence requirements if you want to transfer property between departments, and we have been piloting a new authority model with DND, which helps them better understand and assess their maturity and capacity for managing real property. The more mature you are, the more flexibilities you have to implement real property transactions and to diminish that time.

I'm now going to pass this to my boss.

[Annie Boudreau]

I want to highlight the number of recommendations, either implemented or not, and the progress on implementation of those 119 recommendations as last reported. Just prior to the dissolution of the centre of expertise, we had 31 that were completed and ongoing and 73 that were on track. That's 87% , which is a great number. Only 15 were not initiated or were at risk.

Like I said previously, we are working with departments to make sure that we look at those and rank them low, medium and high. We'll be able to know which ones we'll be looking at in the near future.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

When was the last time TBS reviewed the rent model that allowed 89% of federal tenants to pay no rent for office space?

[Samantha Tattersall]

The space allocation model comes in on an annual basis. Every department is allocated a space. Then, every year—and I'll turn to my colleagues at PSPC—they come and adjust how much they need for that, based on price and volume.

[Michael Mills]

I'm happy to get back to you on when the actual policy came in. I'm not sure when that framework was established.

[Samantha Tattersall]

The original framework for a centralization of accommodation management was in 1985, following the Nielsen report.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Okay. It's just concerning, since tenants currently have no incentive to co-operate.

Budget 2024 claimed $3.9 billion in savings over 10 years. Can the Treasury Board provide this committee the internal analysis behind the $3.9 billion figure, please?

[Annie Boudreau]

Would it be possible to provide a few more details, please, so that we can answer you in the right way?

[The Chair, Conservative, John Williamson]

Ms. Kusie, I'll give you the floor.

This information can be provided at a later date, if necessary.

Ms. Kusie, I don't know if you want to repeat. I paused the clock here, so if you want to be more specific, please do, or you can restate the question. If Ms. Boudreau and her department have questions, they can follow up with the analysts after.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

I'll move on to another line of questioning for my last 30 seconds.

Ms. Hogan, in your report you note that crucial details, like which buildings have been sold, the condition they are in and contributions towards new housing, are hidden from the public. Would you say this lack of transparency actually shields the government from any accountability to Canadians paying for this program?

[Karen Hogan]

Our office always encourages more open and transparent communication of data considered and information available so that parliamentarians and Canadians can make a decision. The reason we highlighted this and made some recommendations was to improve that sort of transparency but also to hopefully create some public pressure to see incentives for reductions in public space. We're always one for encouraging, but you have to have the right data out there and not overwhelm individuals with data.

[Stephanie Kusie, Conservative, Calgary Midnapore, AB]

Thank you very much.

[The Chair, Conservative, John Williamson]

Ms. Boudreau, there was a request for information. It will be part of the transcript. As I understood Ms. Kusie, it was basically looking for a progress report on the budget savings. Could you endeavour to provide that? Whether it's Mr. Mills' department or yours, we'll work through the analyst to get that in the next couple of weeks.

Thank you.

Ms. Yip, go ahead.

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

I want to share my time with Mr. Housefather.

[The Chair, Conservative, John Williamson]

We're not there yet.

I have Mr. Osborne next, and then we're going to have another half round with Mr. Housefather, so he can split it with you, Ms. Yip, or Mr. Housefather can take it all.

First, we have Mr. Osborne for five minutes, I believe.

[Tom Osborne, Liberal, Cape Spear, NL]

Thank you, Mr. Chair.

I'm going to go back to some of my previous questions.

In the Auditor General's report, 41% of tenants “have not signed office space reduction agreements,” as of the time of the findings. There was “an unwillingness or disagreement to move into the new locations that [PSPC] proposed.” There was “no impact on...budget”, and, therefore, “no...incentives for tenants to reduce the space.”

I feel that departments will hold on to one-use space if they don't have an incentive. It's almost impossible, Mr. Mills, for PSPC to compel a reduction in space and to provide information to PSPC from tenants. There are no implications to not responding, and there is no incentive to reduce space.

How do we address this?

[Michael Mills]

I'd like to note that, since the time of the report, we have had more departments sign off. We're down to eight departments. We'll continue to work very hard with those departments to try to conclude those plans. As I mentioned before, part of it will be to make sure that we understand their needs and that they understand the government's overall objectives. We'll have those kinds of clear targets we're trying to achieve and work to conclude agreements with the eight remaining.

[Tom Osborne, Liberal, Cape Spear, NL]

The Auditor General also found that, although your department has the necessary authorities to compel tenants to reduce their footprint, that has not been the practice. The practice is a shared responsibility where the department has to engage in negotiations.

While there has been direction to reduce costs, get spending under control and reduce the amount of space to make space available for other purposes, including housing, Canadians, the general public, are not seeing the results in a more timely fashion. In looking at the recommendations and findings of the Auditor General, we have to find ways of doing this faster or doing it better. There's a cost to holding surplus buildings that are no longer used, as one example, in maintaining those buildings and heating those buildings. The length of time to reduce or dispose of surplus buildings is also a concern. How do we improve on that?

[Michael Mills]

In terms of the improvement on our results on disposing, I think my colleague from the Treasury Board Secretariat has mentioned looking at some new kinds of changes to the rules, some innovation. On our side, we've created a new unit that is piloting new structures. They found waste on transactions reducing the time from nine years to three and a half years. We continue to push.

There is a certain amount of time that will be required for due diligence and circulation to ensure that, if there is an actual need from another public sector entity for space, that can happen, but we are working very actively and in constant dialogue with Treasury Board Secretariat about how we get the rules set and the administrative processes to be as fast as possible to move that.

We also believe that, as we work with our Build Canada Homes colleagues and get it off the ground, we will also try to work with the Canada Lands Company to make housing ready and available in order to get more properties into that chain. We'll then be able to take properties that have great attributes for housing that are surplus to government's needs and make them available on a faster basis.

[Tom Osborne, Liberal, Cape Spear, NL]

I'm hoping that this committee will make some recommendations on how to improve these things. If I were to put that in your words, what do those recommendations look like? You have few effective levers, in my opinion, so how do we give you the levers? Put it in words for me.

[Michael Mills]

Again, it's going back to having a clear target of what the space envelope is, how we calculate that and that it can adjust over time. Departments' labour forces will go up and down, but we need to have a reasonable amount of planning. It may not be instantaneous, but it needs to be able to have adjustments in a timely fashion.

If a department were to reduce in size for whatever reason, say by 10%, after three years we'd be able to reduce their space envelope if we had some mechanisms like that. I think we had mechanisms where, if departments were allocated 10 square metres per employee, but they want to be very aggressive and they found a way to have eight, they could somehow benefit from that extra savings to the Crown. Those mechanisms would be helpful in giving encouragement for everyone to economize on space.

[Tom Osborne, Liberal, Cape Spear, NL]

Mr. Mills, I've heard you a couple of times say that we should standardize the rules of engagement. That's well and good, but I'm interested in how we ensure that departments are responsive in signing agreements to reduce their space. Going beyond signing the agreement and reducing their space, there's an unwillingness for departments or agencies to move spaces. It's not convenient. There's no incentive in their budget.

While I agree that we need to standardize the rules of engagement, we also need to put the levers in place.

[Michael Mills]

It's very challenging from my position as a common service provider to have an enforcement set on the role set.

Again, I wouldn't be able to talk to the consequence of not following that piece.