Transport Committee on Nov. 3rd, 2016

[John McBain]

Very much so. That's our experience.

I can speak to that from two recent examples. We engaged in significant community consultation in Ottawa for the former base, CFB Rockcliffe. Over 250 meetings were held before we submitted the plan to city council. These were town halls, workshops, and idea themes and fairs, as well as stakeholder meetings. We did the same sort of thing in Calgary with the former CFB Calgary, which is now a development called Currie. Both of those projects went to the city councils and were approved unanimously without objection.

There are ways you can go about it. You can spend the money and the time up front to do that engagement, and then your approval comes through very quickly because you have that support, or you can try to rush a project in and then face all kinds of obstacles that delay you along the way.

[Sean Fraser, Liberal, Central Nova, NS]

To follow up on one of the earlier questions, although there may be an additional penny somewhere along the way, there may be fewer total pennies spent on the approval or the completion of a project.

[John McBain]

In our experience with consultation, yes.

[Sean Fraser, Liberal, Central Nova, NS]

Thank you.

Ms. Murphy, I'll ask you a question. One of the problems I think we sometimes have in Ottawa is that we like to apply blunt instruments for very local concerns that don't reflect reality on the ground.

Do you think this bill provides an opportunity to maximize the opportunities that exist locally to make every dollar go further? By way of example, I think it may be a mistake to say, with a public works project, that you must have 25% indigenous participation in the workforce if you're dealing with a community that does not have a local indigenous community, whereas in another community, 80% may be the right figure, depending on what your aims are.

Do you think this kind of bill provides an opportunity to make every dollar go further by reflecting opportunities locally?

[Colette Murphy]

I do. However, the devil is always in the implementation details, so you want something that sets an expectation of a certain kind of behaviour. Then you want to make sure that you put the appropriate supports in place to operationalize them within the context of the regulations.

I'll give you a good example. In Toronto, where we are working with the Toronto Community Benefits Network and others, we know that contractors are not workforce developers. They are in the practice of it, but reaching out into marginalized communities, recruiting, assessing, and training, that's not their role. That's the role of others in this system.

Together, when we look at how we can leverage this opportunity with the $120 billion that's coming down provincially and other dollars that are coming federally into the province, we want to create a workforce development pathway, one that connects supply and demand.

It's best in class in terms of what we would expect as Canadians for this kind of process. It's helping people connect to great careers, not just jobs in one-off precarious work, and that's our role. It's our role to mobilize the city, the province, trades training centres, and communities, with the counsel of our colleagues and contractors, to make sure that when they have an obligation to deliver on, they can do it. We want it flexible enough, but with the infrastructure in place, to support everyone in doing their best work.

[Sean Fraser, Liberal, Central Nova, NS]

I believe that during our last meeting, there was a bit of hesitancy about being too specific in outlining the kinds of community benefits that should be considered for fear of narrowing the creativity of proponents.

Do you think we should have more specific guidelines saying maybe that some of the interests we're trying to pursue are getting more youth engaged, getting women in non-traditional employment, and increasing indigenous participation? Should these be enumerated somewhere, or should we say that you tell us the best you can do, and we'll compare apples to apples as best we're able to?

[Colette Murphy]

I think we need to set some ambition and expectation in terms of being interested in access for communities that have not traditionally been able to engage in the trades or professional, administrative, and technical jobs associated with this type of infrastructure development. I think it's fair to set broad brushstrokes, but the devil will be in the context of the community.

I think the other big challenge is that communities have been told for years to expect less. This is an opportunity for us to lift up ambitions. If you're having a major LRT come through your community, it's going to disrupt you for 20 years. In the case of the LRT in Toronto, it goes through five of the poorest neighbourhoods, one of the poorest ridings, in the country. Those folks should have access to some of those opportunities.

Yes, I think we want to outline the broad areas where we're looking to see change.

[Sean Fraser, Liberal, Central Nova, NS]

Thank you very much.

[The Chair, Liberal, Judy Sgro]

Thank you, Mr. Fraser.

Mr. Sikand.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

I would like to thank the witnesses for being here, especially one of my constituents.

Seeing as we're moving towards being global citizens, and we're trying to build more livable cities, on the face of it I think this is a great bill, but I would like to hear from everyone about potential problems or why this bill might not be good.

I'll start with Mr. McBain.

[John McBain]

Thank you for the question.

I wouldn't say why this bill might not be good, but I would make a couple of observations. Bob and I have talked about this. I don't have the answer, but you may want to consider a dollar limit because hundreds of thousands of contracts are let every year. Does this apply to very small maintenance contracts when a fellow with a pickup truck and a tool belt is coming in to do the job?

I would observe the 15 days within the end of the fiscal year. Those are calendar days, so that's about 11 working days. I don't see the need for that urgency because frankly, understanding government, that report preparation would start in January. You're not really getting the full fiscal year's view.

Plus, the way the government funding cycle works, a lot of work is done right up until March 31. You have a PAYE, pay at year end, system in the federal government that allows that work to be done and then paid after March 31, as long as the work was executed. You would have this lag time between the work being completed and being able to be assessed. I'm not sure of the reason for the 15 days. I don't know that it's that urgent, rather than getting a complete report; sometime later might be beneficial.

My last observation is, the Minister of Public Services and Procurement is not the only minister who lets contracts of this nature in the government. Many other ministers have delegated authorities for this kind of work. To think the Minister of PSPC would be able to pull a full report together for the government would be misleading because many of the others have significant levels of authority.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

And if we fix those, we'll have a perfect bill.

Ms. Powell, do you have any observations?

[Rosemarie Powell]

The one aspect of this that we realize is extremely important is that a process needs to be set in place to manage each potential contract. For example, with Metrolinx we have a working group that includes all the stakeholders. It's more around implementation, obviously. All the right people with authority to make decisions need to be at the table speaking with each other, being transparent in their conversations, sharing issues early so any kind of challenges we're experiencing along the way can be dealt with in an efficient manner.

That absolutely needs to be in place; otherwise, we have failure and challenges and it discredits the actual process.

[Colette Murphy]

I have three quick things:

First, in terms of your remarks about building a global city, we're seeing this kind of practice being embedded in cities from L.A. to London to Glasgow. This is part and parcel of how cities and governments are extracting more value from the development dollars they're letting within their communities.

Second, I would concur with my colleague that you may want to consider thresholds. When you move to the regulatory and implementation stage of certain policies, for example, Scotland, it's over £4 million, and for Toronto, it's over $5 million for certain things. They do set thresholds.

Finally, for large contractors that are competing globally on these types of infrastructure projects, this is how they expect to do business in other jurisdictions; EllisDon is an example.

Bringing it into our own framework, both within the context of procurement and as referred to in Infrastructure and Communities, and in Employment, Workforce Development and Labour, I don't think it would be jarring for them. Certainly in my discussions, they're used to doing this. They just want to make sure the systems are there so they can be successful, to deliver on the apprentices, and support diverse communities.

[Gagan Sikand, Liberal, Mississauga—Streetsville, ON]

You've already answered my second question as well.

Thank you.

[The Chair, Liberal, Judy Sgro]

Thank you very much.

Ms. Block.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Madam Chair, I join my colleagues in welcoming our witnesses here today.

Mr. McBain, I believe I have heard testimony from you before, and I think it was when I was a member of the government operations and estimates committee. This confirms for me that this bill is somewhat misplaced at this table, that it probably should be contemplated at that committee.

The Canadian Construction Association stated on Tuesday that the consultations process, with respect to a local community to define community benefits to go into a PSPC contract would have to be done by the department prior to seeking bids. That's the only way the procurement process would be complied with.

Do you agree with the Canadian Construction Association that PSPC would have to conduct the community consultation ahead for it to be fair for all bidders? The Treasury Board guidelines state very clearly that all contracting must reflect fairness.

[John McBain]

I think, as I indicated in my earlier comments, there is a role for the proponent—the government or ourselves—to identify the benefits that we see in a project that we are going to undertake, and certainly that would come from the consultation process we talked about earlier. I also think equally there is innovation and ability for the contractor to bring another focus in terms of how the work will be executed, and we don't want to be prescriptive in that regard. We could identify areas that, for example, in broad brush, we want to see as benefits, and then part of the evaluation of bids would give points for the contractors that bring those other aspects to the project.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Okay. I want to follow up with that, because earlier, I know you said that you would not identify community benefits in order for contractors to bring their best offer, or I guess some of that innovation, to the bidding process. I guess my question remains, how can a bidding process be fair to contractors if they are not bidding on a uniform tender? Do you believe that the community benefit test described in the bill that is determined by the community on a case-by-case basis aligns with Treasury Board policy, and that the bidding process would be fair if it weren't uniform in terms of what contractors were bidding on?

[John McBain]

I think it needs to be clear in terms of what the proponent is asking for from the contract. As I think we've all said, it would be unique to each project. They may identify, for example, that we want first nations employment or we want a WINTO program, women in non-traditional occupations. We would also allow for the contractors, in their bids, to be innovative in what they bring to the table. There would be a minimum that the government would ask that would be fair for all others, and then what the private sector brings in terms of their bids would bring additional innovation.

[Kelly Block, Conservative, Carlton Trail—Eagle Creek, SK]

Okay.

We've also talked about some of the vagueness in the bill, certainly in proposed subsection 20.1(2) where the word “may” is used instead of “must” or “shall”. It's also very apparent that we are talking about the construction, maintenance, or repair of Public Works federal real property or federal immovables. We know there are 37,000 federal buildings and 20,100 federal properties. If the Minister of Public Works and Government Services requested the contractor to include the community benefit in each bid proposal, do you think there would be an increased administrative cost to the department? Can you comment on whether or not there would be standard community benefits that might be identified by the department, or would you see it being very fluid and changing from project to project? If there were increased administrative costs, how much would they be?

[John McBain]

I'd like to say thank you for the question.... It's pretty loaded.

I mentioned the idea of thresholds earlier and I think that would definitely need to apply here. There would certainly be a need to bring in the experts from the contracting world. It's a complex world. One of the things that I don't think we want to lose sight of is we want the government to be seen as a favoured giver of contracts. You want people to do business with the government. You want to facilitate this so that we get competition in the bids.

I think a threshold in terms of where it would apply is important. Also, it's defining the degree to which the identification of these benefits, as I would say, is auditable. Do you want this to be forensic audit ready? I would submit not. Do you want it to be an indication that must be verified through some measure? Yes.

In that way I think it would be incremental to the bid process, and as I said earlier, contractors have to do these calculations when they're preparing their bids anyway, so we would be asking them to identify some of them more fully.

[The Chair, Liberal, Judy Sgro]

Thank you, Ms. Block.

My thanks to our witnesses. I think we gained a lot of very valuable information from your contributions today. We will suspend momentarily so we can switch witnesses and get another person on our teleconference.

Thank you all very much.

[The Chair, Liberal, Judy Sgro]

Everybody, we have with us today Mr. Toni Varone, past chair of the business development committee of Downsview Park. From the Toronto and York Region Labour Council, we have someone who is not a stranger to any of us, John Cartwright, president. Welcome to you both.

Mr. Varone, would you like to start?

[Toni Varone, Past Chair, Business Development Committee of Downsview Park]

Madam Chair, distinguished members of the committee, my name is Toni Varone and I reside in the city of Toronto.

I appear before you in support of Bill C-227, an act to amend the Department of Public Works and Government Services Act (community benefit). In private life, I own and manage a hospitality company in Toronto as well as a real property business involved in the residential and commercial sectors. In public life, I've served on a variety of municipal, provincial, and federal boards, as well as on charitable non-profit boards. Both my private and public experiences lead me to conclude that the amendment being debated today is not only necessary but essential.

The community benefit mechanism allows for direct investment in local communities by the federal government, which is much too often perceived as being remote and insensitive to local issues. The funds being debated are new funds for the local communities and are not available through traditional means. The community benefit could manifest itself and lead to local improvements to infrastructure as well as benefits to the local environment, to parkland, or even to public art. I'm wishful to think that this community benefit could be as far-reaching as the setting up of local skills development offices or other federal service agencies that far too often seem remote to the local communities.

I understand full well that we are one taxpayer already burdened by taxes from principally all three levels of government. I also believe wholeheartedly that all levels of government should have some tangible focus on local issues, collaborating as much as they can to solve the issues that touch local residents.

In Toronto where I'm active in the business of real property development, I've been involved in what are called section 37 agreements, referring to section 37 of the Planning Act of Ontario. Through section 37, when we as developers exceed local zoning bylaws or impact a community through density or built-form change, we're required to compensate with a community benefit. This benefit can range from improvements to local infrastructure, parks, or public art, to a contribution to affordable housing. It is a local municipal councillor, in dialogue with a developer, that reaches an agreement on the benefit to be conferred to the local community. It is a practice that has yielded many communities benefits not otherwise affordable through their traditional tax bases.

Respectfully, I suggest that this can be emulated at the federal level, and as such, I support this amendment. The onus, however, will be on the local member of Parliament to sensitize himself or herself to the needs of his or her community. The burden will be to use the money wisely so it does not duplicate but enhances other community benefits from other levels of government.

Issues that need to be thought through if this amendment passes are many. I will name a few: whether the community benefit money should be pooled for greater impact or larger projects; whether a balancing mechanism should be adopted to ensure that the benefits reach all communities, since it is inevitable that some ridings or constituencies will have greater resources than others; whether the member of Parliament should be mandated to consult with the local community to search out the benefit; and whether audit and control procedures should be established to make certain that tangible benefits remain in the community.

I close by encouraging support for this initiative. I'm reminded of a saying from the U.S. House Speaker in the 1990s, Tip O'Neill, that all politics is local.

Thank you.