Transport Committee on Feb. 28th, 2022

[The Chair, Liberal, Peter Schiefke]

Next we have Mr. Dowdall.

Mr. Dowdall, you have five minutes. The floor is yours.

[Terry Dowdall, Conservative, Simcoe—Grey, ON]

Thank you, Mr. Chair, and thank you as well to all our guests who are here today.

As someone who was a mayor for quite some time, I think probably the number one thing that most mayors and everyone wants to do is get shovels in the ground. It was certainly a priority when I was a mayor, and it's a priority now. I have seven towns and townships in Simcoe—Grey with many needs, and I understand, quite frankly, that we need large, different infrastructure, even for lending the money out for certain projects that are larger than the municipalities—say, connecting different towns and cities together. I understand that. I think it would be a lot easier, and maybe I could get your thoughts on it, that when the gas tax was introduced, it gave us an opportunity that's sitting there—and it's a frustration I get—to have reliable and stable funding to know how to move forward.

To give you insight into what goes on outside Ottawa, the politicians who are in those areas know their area. It costs a lot of money to get these applications going forward. You get your planners and engineers, and you do up the application. Then you sit and wait, and it's like a lottery to see if you get the money or don't get the money. Some of these towns and townships don't have that much money to begin with when it comes down to just getting into the application process and for the size of the project.

I wonder if there's any thought or insight into that we make it similar to the gas tax, other than those huge projects, for every town and township, so we don't create winners and losers. I know that's a frustration. If they know what that is, it's easier to do a large project and to do a debenture if you know those funds are coming in. Could you comment on that process?

[Kelly Gillis]

I think that goes back to having an array of tools. You need a spectrum of different tools to achieve different objectives. The gas tax is one tool that certainly has a simplification in administration, but it also has been criticized by the PBO and the Auditor General from a transparency and accountability perspective.

There are different pros and cons to using different tools, and as we're looking at getting certain outcomes within the country, whether it's GHG reductions or inclusivity, or other tools. We have programs that are designed to get certain outcomes. It's by having a range of different tools that you can get the infrastructure that you need built.

That also goes back to the national infrastructure assessment that we were talking about a minute ago. As we look at the long term and making sure that we have the right evidence and information to make informed decisions as we're moving towards a net-zero 2050 and have the infrastructure we need for Canadians and a good standard of life, the gas tax is a very important tool, as well as others, in achieving that.

[Terry Dowdall, Conservative, Simcoe—Grey, ON]

I guess the follow-up to that is, if we knew what those moneys were to go to, at least they would know how much they're getting each year to do that. I just know it's very expensive for all these towns and townships to go through the process and just then hope.

Anyway, I'll go to something else quickly. In March 2021, the Auditor General found that half of the investing in Canada plan's reporting did not include programs that pre-dated its creation, even though they made up almost half of the $188 billion in commitments. The problem was flagged in 2017 and 2019, but to me, it doesn't look like it was acted on. The auditor also determined that a fifth of the planned spending was unspent in the first three years of the plan and was moved to later years.

Simply put, half the investing in Canada plan reporting was for projects done before it existed, and a fifth of its funding was pushed to further years.

Can you tell me how this was able to go on for so many years?

[Kelly Gillis]

When we look at the investing in Canada plan, at this point in time we have $118 billion out of $188 billion to approved projects. We are six years into the particular plan. As we look to move forward, half of the programs in there have actually been completed or have exhausted their funding. This information is all on our website.

In terms of the Auditor General, for the programs that were in existence but still active when the plan was created, their recommendation to us was something called a “horizontal report”, a template given by Treasury Board Secretariat for us to include the legacy programs. Because those programs were in existence when the plan was created, at the time, Treasury Board Secretariat did not require us to include it in the report. The Office of the Auditor General, when they did their report last year, for a more complete reporting, asked us to do so and we committed to do so starting in 2022-23. Therefore, in the coming months you will see, as part of the supplementary table, that particular report include our legacy programs.

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Mr. Dowdall.

Next we will go to Ms. O'Connell.

Ms. O'Connell, welcome to the committee today. The floor is yours. You have five minutes.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

Thank you, Mr. Chair; and thank you to all of the officials for being here today.

I want to clarify some things on the record that I think were unclear. I want to make sure there are no misperceptions out there.

Earlier, in the panel with the minister, as well as in this round, it was suggested that no infrastructure is actually being built. First, can we clarify that piece?

Secondly, then it was suggested with the minister that his portfolio is so large and there are questions that only 33 infrastructure projects are being undertaken at this time. However, to clarify, those 33 projects are actually the Canada Infrastructure Bank's, not the totality of the infrastructure portfolio.

Then, Ms. Gillis, you spoke about 10,000 projects currently under way, worth about $83 billion. Can we get some clarity on the record that there are currently significant amounts of infrastructure not only being built but also have been built, and that the 33 projects are specific to the Canada Infrastructure Bank and not the entire infrastructure portfolio?

[Kelly Gillis]

Thank you for the question. I'm very happy to clarify.

First, the 33 projects that were mentioned, both by the minister and me, are the Canada Infrastructure Bank's and only the Canada Infrastructure Bank's.

The 10,600 projects that I mentioned are the projects that have been approved for the various programs, not including the gas tax, here at Infrastructure Canada as a department, worth $43.9 billion of federal investment. On top of that, we've also approved $17.5 billion in the gas tax. The gas tax goes to about 3,600 communities for about 4,000 projects every year. Hence, there is significant activity that has happened since 2015 in infrastructure, both being built, having been built, and active right now, with that volume of investment.

Those numbers that I just quoted do not include the 33 projects; I'll put that aside. That's almost $20 billion of separate investment that the Canada Infrastructure Bank oversees.

There are two other major projects that I have not mentioned in there, which is $11 billion worth of investment, both the Gordie Howe International Bridge, which is four years into a six-year build, as well as the new Samuel de Champlain Bridge, which is built and in use in Montreal. Therefore, significant investments have happened since 2015 through this ministry, with a lot of infrastructure projects that are completed as well as being built.

I'll turn maybe to my assistant deputy minister Alison O'Leary. She might have a bit more on the built and under way.

[Alison O'Leary, Senior Assistant Deputy Minister, Communities and Infrastructure Programs, Office of Infrastructure of Canada]

Absolutely, and thank you.

I think one thing that's important to remember is that the figures the deputy minister was mentioning are for projects that have been approved. Once we approve projects, proponents can start construction right away, as long as any conditions associated with that approval have been met. They can begin their construction, and they do. Then we receive the claims for those projects coming in as the construction progresses throughout the life of the projects. The economic activity starts as soon as the projects are approved and any associated conditions have been met.

Thank you.

[Jennifer O'Connell, Liberal, Pickering—Uxbridge, ON]

That's perfect. Thank you so much for that clarification.

With 10,600 projects and $43.9 billion, and then an additional 3,600 through the gas tax, certainly the Conservatives' suggestion that this represents no projects.... I mean, that's a significant amount of investment in communities right across this country that the Conservatives downplay as absolutely nothing being built.

Coming previously from municipal politics as well, I know how significant it is to get that approval process. We have, in this country, construction seasons in certain parts of the country. If contractors tend to be busy, that can delay projects and things like that, but can you maybe speak to—because you touched on it, Ms. Gillis, in the earlier round—the issues around COVID and some of that, in getting those after approval by municipalities or community groups and indigenous organizations, to then engage with contractors, as an example, causing some of the delays...? Can you maybe elaborate on some of that experience and the work that you and your department are doing to ensure those approved funds translate into shovels in the ground?

[Kelly Gillis]

Certainly.

When COVID arrived, we looked at all of our programming to see what would be relevant and appropriate in the context of living in a pandemic. We adjusted our integrated bilateral agreements to create something called a “COVID stream”. In that particular stream, communities, provinces and territories could look at projects that would be making communities more resilient to living with COVID, such as doing HVAC, ventilation and social distancing.

Within that stream, we allowed a 10% transfer of funds from other streams into that particular stream—optional. Provinces and territories could determine whether they wanted to avail themselves of this particular option. The maximum project value was $10 million, and we created quite a streamlined process to approve projects within 20 working days so that we could make sure they could be done fast and could be done quickly and get into the communities while we are living with COVID—

[The Chair, Liberal, Peter Schiefke]

Thank you very much, Ms. Gillis. Unfortunately, that's the amount of time we have for that round of questions.

Mr. Barsalou‑Duval, you have the floor for two and a half minutes.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you, Mr. Chair.

My question is for Ms. Gillis and concerns the much talked about high frequency train that has been proposed and announced on multiple occasions by the government.

The high frequency train was in the mandate letter of the former minister, Ms. McKenna, but it is not in the mandate letter of the current minister, Mr. LeBlanc.

So I wonder if the department is still involved in some way with this project or if it is no longer part of their plans at all.

[Kelly Gillis]

Thank you for the question.

In fact, this is part of the mandate letter of Minister Alghabra. He is responsible for the project, in conjunction with Transport Canada. The file is moving forward.

There is also a joint project office at the Canada Infrastructure Bank and Via Rail. Our department as well as Transport Canada are working with these agencies to move the project forward.

In addition, our team, with Glenn Campbell, is working on the issue of expertise with respect to other forms of funding.

Maybe Mr. Campbell can add a few words about this project.

[Glenn Campbell, Assistant Deputy Minister, Investment, Partnerships and Innovation, Office of Infrastructure of Canada]

Yes, I'd be happy to.

With respect to the high-frequency rail project, Infrastructure Canada is providing technical support for planning and advisory services to our colleagues as they prepare for this project, and I would refer to Transport Canada to speak to any of the merits of the project.

We're also facilitating the supporting work of the Canada Infrastructure Bank towards a joint project office, where they are collaborating with Via Rail again on the long-term planning of that project. We are very happy to provide our technical expertise in P3 and alternative finance to our other department that is leading that project.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you.

Do I have any time left, Mr. Chair?

[The Chair, Liberal, Peter Schiefke]

You have 15 seconds, Mr. Barsalou‑Duval.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

In that case, I will yield to the next speaker.

[The Chair, Liberal, Peter Schiefke]

Thank you very much.

We have Mr. Bachrach for two and a half minutes.

Mr. Bachrach, the floor is yours.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Thank you, Mr. Chair.

I'm going to try to put a bit more of a point on my last question from the last round.

The question, Ms. Gillis, is really whether, given the well-documented shortcomings of the Canada Infrastructure Bank and the challenges it has faced, there has been an internal discussion at the department about adjusting the mandate of the bank to better meet the needs of communities.

[Kelly Gillis]

As the bank has advanced and evolved, it has made tremendous advancements in a number of projects over the last couple of years. It is now at 33 projects with $20 billion worth of investment. I would think, as is done for any tool, the bank has a legislative review at five years, and that would be the appropriate juncture to look at the mandate. That happens with any Crown corporation over a period of time.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Ms. Gillis, to shift gears a bit, when the Auditor General looked into the investing in Canada infrastructure program, one of the things that were found was that the sustainable development goals were not being considered when project applications were being assessed. Has that been formally addressed in the review process?

[Kelly Gillis]

We do submit our sustainable development goals through the horizontal reporting through Employment and Social Development Canada, but the Auditor General would like us to also include those goals in how we report on that—and that, again, is under way and being done. That was being done, but it was just that they were being reported through a different mechanism.

[Taylor Bachrach, NDP, Skeena—Bulkley Valley, BC]

Will they be formally included in the assessment of project applications as well as in the reporting?

[Kelly Gillis]

They are. They're actually very similar when we look at transportation needs, reduction of GHGs and the off-diesel initiative. Those are consistent outcomes we look for in sustainable development goals and our other goals and in what we are looking for within our projects.