TRGO Committee Meeting

37th PARLIAMENT, 1st SESSION

Standing Committee on Transport and Government Operations

EVIDENCE

CONTENTS

Tuesday, March 12, 2002

Á

1100

The Chair (Mr. Ovid Jackson (Bruce--Grey--Owen Sound, Lib.))

Mr. Ghislain Lebel (Chambly, BQ)

The Chair

Mr. Boudria

Á

1105

Á

1110

Á

1115

Á

1120

The Chair

Mr. Peter Goldring (Edmonton Centre-East, Canadian Alliance)

Á

1125

Mr. Boudria

Mr. Peter Goldring

Mr. Boudria

Á

1130

Mr. Peter Goldring

The Chair

Mr. Boudria

The Chair

Mr. Reg Alcock (Winnipeg South, Lib.)

Á

1135

Mr. Boudria

Mr. Reg Alcock

Mr. Boudria

Á

1140

Ms. Jane Billings (Assistant Deputy Minister, Supply Operations Service Branch, Public Works and Government Services Canada)

Mr. Reg Alcock

Mr. Boudria

The Chair

Mr. Ghislain Lebel

Á

1145

M. Boudria

Á

1150

Mr. Ghislain Lebel

Mr. Boudria

Mr. Don Boudria

The Chair

Mr. Boudria

The Chair

Mr. Marcel Proulx (Hull--Aylmer, Lib.)

M. Boudria

Á

1155

Mr. Marcel Proulx

Mr. Don Boudria

The Chair

Mrs. Bev Desjarlais (Churchill, NDP)

Â

1200

Mr. Boudria

Ms. Jane Billings

Mr. Boudria

Mrs. Bev Desjarlais

Mr. Boudria

Mrs. Bev Desjarlais

Mr. Boudria

Â

1205

Mrs. Bev Desjarlais

Mr. Boudria

Mrs. Bev Desjarlais

Mr. Boudria

Mrs. Bev Desjarlais

Mr. Don Boudria

Mrs. Desjarlais

The Chair

Mr. Alex Shepherd (Durham, Lib.)

Mr. Don Boudria

Mr. Shepherd

Mr. Boudria

Â

1210

Mr. Alex Shepherd

Mr. Boudria

Mr. Alex Shepherd

Mr. Boudria

The Chair

Mr. Jim Pankiw (Saskatoon--Humboldt, PC/DR)

Â

1215

Mr. Paul Szabo (Mississauga South, Lib.)

Mr. Jim Pankiw

The Chair

Mr. Jim Pankiw

Mr. Boudria

Mr. Jim Pankiw

Mr. Boudria

Mr. Jim Pankiw

Mr. Boudria

Mr. Jim Pankiw

The Chair

Mr. Boudria

Mr. Jim Pankiw

Mr. Boudria

The Chair

Mr. Boudria

Mr. Jim Pankiw

The Chair

Mr. Boudria

Mr. Jim Pankiw

Mr. Boudria

Mr. Jim Pankiw

Mr. Boudria

The Chair

Â

1220

Mr. Jim Pankiw

Mr. Boudria

Mr. Jim Pankiw

Mr. Boudria

Mr. Jim Pankiw

Mr. Boudria

The Chair

Â

1225

Mr. André Harvey (Chicoutimi--Le Fjord, Lib.)

Mr. Boudria

Â

1230

The Chair

Mr. Peter Goldring

Mr. Boudria

Mr. Peter Goldring

Mr. Boudria

Mr. Peter Goldring

Mr. Boudria

Â

1235

Mr. Peter Goldring

Mr. Boudria

The Chair

Mr. Goldring

Mr. Don Boudria

The Chair

Mr. Reg Alcock

Mr. Boudria

The Chair

Mr. Normand

M. Boudria

The Chair

Mr. Ross Nicholls (President and Chief Executive Officer, Defence Construction Canada)

Â

1240

Mr. Normand

M. Boudria

The Chair

Ms Bev Desjarlais

Mr. Boudria

The Chair

Mr. Jim Pankiw

The Chair

Mr. Ghislain Lebel

The Chair

Mr. Ghislain Lebel

Â

1245

Mr. Boudria

Â

1250

The Chair

Mr. Jim Pankiw

The Chair

Mr. Pankiw

The Chair

Mr. Jim Pankiw

The Chair

The Chair

---

CANADA

Standing Committee on Transport and Government Operations

---

NUMBER 054

l

1st SESSION

l

37th PARLIAMENT

---

EVIDENCE

Tuesday, March 12, 2002

[Recorded by Electronic Apparatus]

Á  (1100)  

[English]

    The Chair (Mr. Ovid Jackson (Bruce--Grey--Owen Sound, Lib.)): Good morning, ladies and gentlemen. I'd like to call the meeting to order--it's my style to start on time. I understand the minister is only going to be here until 12:30, so if we delay too much, there won't be a lot of time for questions.

    We're here today pursuant to Standing Order 81(6), having to do with the main estimates concluding on March 31, 2003.

    With us today is the Honourable Don Boudria, the Minister of Public Works and Government Services. Accompanying the minister are a number of deputy ministers. They include Jane Billings, Carol Beal, Rodney Monette, and Michael Turner. If the minister has other officials, he could introduce them as well.

    Colleagues, as you know, there has been a cabinet shuffle, with some changes in areas of responsibility. Ministers are only responsible for answering questions under their purview. For your edification, I've given you the crown corporation list, so that you know which apply to this particular minister.

    We have just a small item of business. Mr. Lebel, a member of the committee, wants to table a motion. The motion will not be dealt with now, as he needs 48 hours, but under the procedure, he's allowed to present it.

    The floor goes to Monsieur Lebel.

[Translation]

    Mr. Ghislain Lebel (Chambly, BQ): Thank you, Mr. Chairman.

    I want to take this opportunity to table a motion that essentially reads as follows:

That the Standing Committee on Transport and Government Operations invite Jean Brault, the President of Groupaction Marketing, to appear before the committee to tell us what contracts were obtained from Public Works and Government Services and what was contained in the report on the study of ways to increase federal government visibility and in the report concerning the production of a list of 1,300 cultural events.

    Thank you.

[English]

    The Chair: Merci beaucoup. Hopefully, we'll deal with this on Thursday.

    Mr. Minister, you know the routine. Please introduce your officials, give us your dissertation, and then we'll start our rounds of questioning.

    Hon. Don Boudria (Minister of Public Works and Government Services, Lib.): Thank you, Mr. Chairman, members of the committee.

    It's a pleasure for me to make my first committee appearance as Minister of Public Works and Government Services, Minister responsible for Communications Canada, Defence Construction Canada, and the Queens Quay West Land Corporation. I suppose I can say also, for the next 10 days or so I'm still responsible for closing down the operations of les quatrièmes Jeux de la Francophonie, which are also in the process of ending, the games having taken place last summer, as all members will know.

    I was honoured when the prime minister appointed me as Minister of Public Works and Government Services. I'm delighted to have the responsibility for a department that is truly central in the day-to-day operations of the government and has been, in my view, and I think all objective views, well managed and professional in its conduct, with a long and proud history. I fully intend to continue in that tradition. In fact, I've already made it clear to officials that I expect the Department of Public Works and Government Services to continue to improve and to strive for excellence in its service to government and to the Canadian taxpayers.

    Allow me, Mr. Chairman, to thank my parliamentary secretary, member of Parliament Mr. Paul Szabo, for his help during my first few weeks on the job and for conveying to the committee my desire and my enthusiasm to appear before it today on the estimates.

    Mr. Chairman, I must tell you that I'm most impressed by the depth of the department's activities. My department is at the centre for solutions. Our role is to provide essential goods and services needed by nearly 140 other federal departments and agencies in order to fulfil their mandate to Canadians. Our aim is to provide the best value for government, taking into account public policy of the day, and of course, with due regard to prudence, probity, and transparency. It's certainly in that way that I intend to do my job. This is accomplished by instituting a transparent process, where the rules are made available to all, most opportunities are posted in the public domain, details on all contract awards are published, and suppliers have access to a redress mechanism for all trade-covered procurement, namely, the Canadian International Trade Tribunal, CITT. I'll be glad to speak to that issue and how it has worked during the question period later.

    Every day, in every region of Canada, Public Works and Government Services plays a role in virtually every major federal government initiative, whether it involves a new building or structure, an expanded program of government, a major crown procurement, or responding to emergencies. In short, we help other federal organizations do what they do best, which is, of course, serving Canadians.

    I was quite impressed when I was given my first briefing--if I can depart from my text--and was told about various aspects of the job. All of a sudden, someone said, and it was probably my deputy, now, Minister, we want to tell you about the Alaska Highway. I responded, what on earth does that have to do with me? He said, well, you're the minister responsible for over 800 kilometres of it, including 26 bridges. Needless to say, before becoming Minister of Public Works, I certainly didn't know that would be part of the job.

    To give honourable members some sense of the scope of our activities, in 2001 my department awarded 60,000 contracts worth more than $10.5 billion, or approximately 65% of the federal government's contracting in goods and services. This makes us the biggest procurement agency in Canada. Public Works and Government Services Canada manages thousands of transactions every single day of the week. We provide office accommodation to 187,000 public servants and parliamentarians in more than 2,500 locations across the country, from Alert to Pelee Island, from one coast to another, with a real estate portfolio worth more than $6.8 billion.

[Translation]

Á  (1105)  

    My department does much more, Mr. Chair. Everything from managing the Government of Canada's financial transactions and accounts to providing translation and interpretation services—for example, the interpreters who are here in this room are employees of our department—as well as terminology and linguistic services to Parliament and the Public Service, as well as leading the way to e-government. I know that many MPs are interested in e-government. I am thinking for example about Mr. Alcock, who has made a career of it and I congratulate him.

    Technology will be a driving force in how we operate and deliver our services in the future. We will provide the electronic structure—the Secure Channel—that will allow citizens and industry to do business with the government. We are also building the Electronic Supply Chain to support efficient procurement of goods and services. We will soon be able to do entire transactions electronically: order products, receive invoices and even make payments. This is currently being developed. The project will result in an automated process from end-to-end for both suppliers and government players.

    We will continue to help our government build a world-leading economy driven by innovation, ideas, talent and the commitment to excellence. We will help create a more inclusive society through our commitment to achieving a work force that is representative of Canadians. Our initiative to develop an international program will help to enhance Canada's presence and reputation throughout the world. And, we will promote a healthy environment through our Sustainable Development Strategy—this issue was recently raised in a speech by the NDP member Mr. Martin, in the House of Commons—which seeks to green government operations—an area in which we have already accomplished a great deal. For example, through the Federal Buildings Initiative, we have, between 1993 and 2000, reduced our energy cost by $6.5 M per year and have reduced green gas emissions by more than 50,000 kilotonnes per year. That is only with the savings we have generated thanks to better insulation and products like that in federal buildings throughout the country. Of course, for all intents and purposes, we are really just scratching the surface. A lot of work remains to be done as we renew leases and build new buildings.

    As I indicated in my initial message to the 14,000 people in my department, I intend to devote my energy and enthusiasm to support their many talents as well as fostering greater innovation and collaboration, both nationally and internationally, to ensure our continued success.

    In the new century, Public Works and Government Services Canada will continue to be a relevant, dynamic organization on the move, contributing to the quality of life of Canadians. I am proud of my department and its employees who, through their skills, energy and commitment to Canada, make a contribution to our country every day. I made a commitment to travel across the country and to meet the employees of my department personally. I have met with thousands of them to date, in Vancouver, Victoria, Edmonton, Toronto, Montreal and Halifax, and I have shaken the hands of each and everyone of them and told them how much their work is appreciated by all Canadians.

    As you know, Mr. Chair, I am also responsible for Communication Canada, for Defence Construction Canada and for the Queens Quay West Land Corporation. Allow me to briefly talk about these organizations.

    Let me start with Communication Canada, an organization for which I am responsible—and proud to be—as Chair of the Cabinet Committee on Government Communications.

Á  (1110)  

    Established on September 1, 2001, Communication Canada—which is very new—merges the former Canada Information Office and the former Communications Coordination Services Branch of Public Works and Government Services Canada. All Government of Canada communications coordination services are now under the same roof. In fact, other countries such as France, the United Kingdom and Australia, and here at home, Alberta, Ontario and Quebec have established similar organizations, as we all know.

    By bringing together the human and financial resources and the expertise of these two organizations, the Government of Canada has equipped itself with the means to respond to the new communications realities of the 21st century, while facilitating the way Canadians interact with their government.

    Obviously, as a new organization, Communication Canada must put in place an infrastructure that is efficient, creative and modern. That is why it is fully committed to the Results for Canadians framework. Because Communication Canada serves Canadians, we are committed to providing quality services and better access to government information. Indeed, it is a priority.

    As we are a new organization, we decided to be a pilot department for the Modern Controllership function, a Treasury Board reform based on sound management of resources and an efficient decision-making process. I insisted on that as soon as I was appointed.

    We have committed to these improvement programs not only because we are a new department, but because we want to operate effectively, efficiently, and transparently to better serve Canadians.

    As a matter of fact, one of the reasons I am here today is to talk about transparency and my commitment to improvement. For example, we have put into place an action plan based on the recommendations of an internal audit of the Sponsorship Program. New guidelines have been established; and there are strict procedures concerning payment methods, billing, and follow-ups. All are administered by an independant agency. As well, since January 2002, since my arrival, information related to sponsorship contracts and advertising services have been available on-line on the Contracts Canada Web site. We have made this public in the name of transparency.

    Following the internal audit, we reviewed sponsorship files processed since the implementation of the action plan. The review report indicates that files contained all the documents required by the sponsorship management process that Communication Canada has put in place. That is an example of improvements we've made.

    Of course, a key goal of the Sponsorship Program is to better inform Canadians on the program and services of the Government of Canada. This is entirely consistent with the mandate of Communication Canada: to improve communications between the Government of Canada and Canadians.

    Communication Canada is therefore responsible for the principal access channels on information and services for the entire government.

Á  (1115)  

Canadians can obtain information in whatever way and whenever is most convenient to them, be it by telephone, in person or via Internet.

[English]

    And it's working, Mr. Chairman. Let me give you an example. Since April of last year the 1-800-O-Canada toll-free line has responded to more than 1.2 million calls from all over Canada. It's even accessible from overseas using this little card. Even people outside the country can telephone and obtain information about the services we have for our citizens.

    Communication Canada is also responsible for the government's official newspaper, the Canada Gazette, an important tool for the official dissemination of public notices, appointments, regulations from government departments and agencies. Maître Guy Mc Kenzie is the Queen's Printer.

    But communicating with citizens is more than simply distributing information, it goes way beyond that. For the government, communication also entails listening to citizens and understanding their priorities. This is manifested, for instance, by the fairs and exhibits program and the outreach program. People who have been to the International Plowing Match and a number of other activities have seen the large kiosk where various government departments, either for hiring or any other thing, are fully on public display for Canadians to see, all across the country. It's the same at the Calgary Stampede and at other places, where we have these very large kiosks.

    Since April of last year 1.1 million people have visited the Canada pavilion, the one I've just described, at 20 fairs and exhibits across the country. More than 40 community activities have been organized in collaboration with local and regional partners, permitting us to communicate directly with thousands of citizens.

    Communication Canada also undertakes detailed research into the needs and wishes of Canadians in the area of communications. It is how we can ensure that our programs and those of the government are responsive and that our communications reach all Canadians, wherever they may be in the country. Of course, there are the Internet and other services outside the country as well.

    Communication Canada also has a regional coordination office in every Canadian province. It's a network of professionals who understand the communications realities particular to their regions. They work closely with senior civil servants and communications and other departments to develop products and activities that help improve our communications in the regions.

    Though we have been operating as an organization for only a few months, I am convinced that with the dynamism and energy demonstrated by its employees, under the tremendous leadership of Mr. Mc Kenzie, we will build on past experiences and contribute significantly to improving communications between the Government of Canada and Canadians.

    Let me say just a few words about Defence Construction Canada, led by Mr. Ross Nicholls, who is here. The DCC continues to support the management of facility infrastructure owned by the Department of National Defence. This year the total expenditure on construction contracts put in place by DCC will be $350 million, with a further expenditure in the order of $30 million on contracts for architectural, engineering, and scientific services. This level of activity has been relatively constant over recent years. The year 2002 will mark the corporation's 50th year of service to DND and to the Government of Canada.

    In case you're wondering what some of the largest projects being done lately by Defence Construction Canada are, there's a lot of environmental remediation, for instance, with the 21 distant early warning, or DEW line, radar stations in the far north. Clean-up activities will continue until at least 2008, with contract expenditures expected to total $340 million.

    The Queens Quay West Land Corporation is also one I am responsible for. It's a very minor one in the grand scheme of things. It manages the remaining lands belonging to the crown around the Toronto waterfront. Its mandate is to oversee the sale of crown assets particular to that corporation, not the others in Toronto, but just the ones that belong to Queens Quay--I believe there's only one property left--and then the dissolution of that very small corporation.

Á  (1120)  

    So as you see, Mr. Chairman, these organizations are working hard on many fronts. It is with great certainty that I say they will continue to be valuable assets for all Canadians.

    I want to conclude by saying to all my colleagues that I look forward to their input, their suggestions, their work over the coming year, reports this committee may want to provide to me, constructive suggestions on making the system better. Anything like that will be more than welcome. Meeting with colleagues, whether they're on this side of the table or that, is something I intend to undertake, to have good relationships with colleagues in order to take a system that is already excellent and, if there is any way we can, make it better.

    The Chair: Thank you very much, Minister.

    We'll go to a round of questioning. The first round is ten minutes each, and I go to Peter Goldring of the Alliance Party of Canada.

    Mr. Peter Goldring (Edmonton Centre-East, Canadian Alliance): Thank you, Mr. Chairman.

    Once again, Minister Boudria, I congratulate you on your appointment, and I look forward to an open dialogue on all the concerns.

    My first question is relative to an issue that is in today's news, but this goes back to June of last year with the same corporation. I suppose this underlines the concern we all have to ensure openness and to return the confidence of the public in issues and operations of the public works. This concerns an issue from June of last year, where it was reported that overall, Public Works purchased $3.3 million of promotional items, and one corporation, Groupaction, was named in the list as a recipient of part of that business; Groupaction, in this particular issue, purchased 288 watches from Birks and distributed them. If you take the 17.6% commission this corporation normally receives on these promotional items, the amount on that $3.3 million is some $600,000. This corporation is also reported as later contributing back to the Liberal Party some $68,000 in donations.

    We wish to have openness and transparency, but the suggestion in this reporting is that some corporations are receiving a commission on Public Works business, and then in return, an equal commission is coming back to the Liberal Party. This is the way the numbers are shown in it. Do you have any information on this previous dealing at all? Would it be something you would be looking into, to try to learn from the past to see what we do in the future, if these suggestions are true, or if they're not true, to answer them?

Á  (1125)  

    Mr. Don Boudria: I want to thank my colleague for his question.

    A number of these issues involved in contracting are important, and I don't think they should be embellished by making these references to people. It's public information who contributes to every political party in the country. I don't want to get into that, I'm not the minster responsible for the Elections Act. If members want to change that process, make it better, make it transparent, there's another committee that deals with that. We recently dealt with amendments to the Elections Act. As a matter of fact, I was the minister responsible when we did it. So that process is to be handled elsewhere.

    The process handled over here, I believe, is the one dealing with government contracts. We all know there was, in March 2000, a internal audit involving sponsorship files, handled by the then portion of PWGSC, Public Works and Government Services Canada, dealing with issues involving advertising and so on. Later that particular unit was transported to the newly-created department Communication Canada, led today by Mr. Mc Kenzie. In the internal audit in 2000 there were a number of gaps concerning the processing of sponsorship files. For instance, were we giving, in a particular sponsorship or otherwise, too much commission in the middle of the project, not enough later? Some changes were made, with a better system of verifying, known as the post mortem reports. In other words, if you're buying an ad in a particular publication, there should be on file the actual copies and so on, the verification of disbursements, the guidelines for awarding of sponsorships, requirements and documentation regarding agreements, better documentation on file of the kind I described a while ago.

    All these things were done, and later reports--and I'm thinking of one here involving ethics published by the Conference Board of Canada--stated quite clearly that we're doing the right thing, qualifying all these as exemplary public sector programs--pages 16 and 17 of the Conference Board report.

    Mr. Peter Goldring: Mr. Minister, if I could continue, it has been reported recently that this same corporation has again been involved in another contract for $575,000, and in the same article it's related that once again they contributed some $70,000. If there's any truth to it, the numbers are surprisingly similar: it was 11% before and it's 12% today. So once again it looks as though there is a direct correlation between the contracts received and the amount of money that is returned to the Liberal Party of Canada.

    Is there a reality to it? Is it coincidental? The important thing here is that it looks to the public of Canada as though there is a direct correlation. What can we do about it to remove that doubt from the public's mind? It's very important to the public to have total confidence that the system is fair and at arm's length. These two articles indicate that it's not.

    Mr. Don Boudria: The system is fair and at arm's length. If you want to refer to the two contracts that were the subject of questions during question period yesterday, I can refer to those now, if that is the theme of the question.

    There were two reports that were produced, one in 1998 and one in 1999. The one relating to 1999 will be tabled in the House of Commons tomorrow. It was a colleague, a member of Parliament, who made the request. I have it right here actually, but it must be tabled in the House first. I actually offered yesterday. Had the House given me its consent, I would have tabled it right there and then yesterday, but officially, that is done on Wednesday. as we know. That's in regard to the second report. It's right here.

    The first report, the 1998 one, isn't available. It's not acceptable that this report not be available; I said that in answer to a question in the House of Commons yesterday. But it's not right to claim that there's no paper traced, no work done, and so on. The background information for the document is here in this binder. We have elsewhere a copy of the contract that was signed, a list of the interim payments that were made. There are certifications pursuant to the Financial Administration Act that were signed by the senior government official. They're right here, as a matter of fact. All of that is here. So there's a stack of documents three inches thick. It's not what was alleged yesterday, that no such documentation existed.

    Yes, the final report is not available. Yes, it should be available. The industry tells us that after 18 months they don't keep that, so we can't get another copy from them. I wish it were different. Three years later we should have it nonetheless. Even though the industry norms are different, I think all colleagues would expect me to have that document and to table it, which I would gladly do, and I will still do if and when I can retrieve one.

Á  (1130)  

    Mr. Peter Goldring: Mr. Minister, I suppose once again the public would be incredulous that you have a three-inch purchase order there of documents, basically, calling for a product to be produced. Yet you have the purchase order closed off and the cheque sent in the mail, and you don't have the product. In today's day and age of computers and recording and filing, it's seemingly impossible, I believe, for the public to understand that this could happen. The question really should be, who is responsible for this? Has that person who is responsible for it been queried as to whether there has been a lack of care and attention to the file? Has there, indeed, never been a report produced at all? What proof do you have that there was ever a report produced, other than somebody saying so?

    The Chair: Mr. Minister, you've got about 20 seconds.

    Mr. Don Boudria: I'll do my best in so short a time.

    As I said, I'm ready to table any of the documents. By the way, that's not a three-inch thick purchase order, that's not what I said. These are the documents in support of the final product, not the purchase order. The purchase order is actually over here. These are the interim contract payments pursuant to each step of it, and these are the background documents to the actual report that was produced.

    As for the senior civil servant who at the time signed the document, he's since retired. He no longer works for the Government of Canada. I haven't said his name publicly. People can consult documents and have that. He has been contacted. Pursuant to those contacts, I'm willing to table all the documentation bearing his signature. I have all that.

    The Chair: Okay.

    We'll move now to Reg Alcock.

    Mr. Reg Alcock (Winnipeg South, Lib.): Thank you very much, Mr. Chairman.

    I have passing interest in issues concerning government use of information technology, both to provide services and in its own operations. I can certainly support everything you said. The 1-800-O-Canada system is marvellous. I fully recommend that members go and have a tour and get a sense of just how complex a system they have put together, how well it is managed, and the tremendous service it provides, as too with the Canada website.

    I do have some questions, though. The minister will know the topic on which I wish to raise some questions, and that's the electronic procurement system. The MERX system that is currently in use is considered by many to be outdated, badly in need of restructuring and change. There are lower cost alternatives available, some available here in Canada, including one that is owned by the government itself, in a different department, that would seem to provide both lower-cost and higher-quality service. And yet I understand there is some reluctance to entertain other alternatives. I'd be interested in knowing why.

Á  (1135)  

    Mr. Don Boudria: The MERX system--I don't know if colleagues all know how it works--is a private sector service the Government of Canada purchases. It is supplied by a company that is essentially Bank of Montreal. Together, the Government of Canada and a number of the provinces are plugged into that. You subscribe to the service, and it gives access to all these things for more than one level of government. So it becomes a form of central clearing house. You subscribe to it, you go on-line, and you see what's available by way of business opportunities. If you sell chairs, you can find out whether you can sell chairs to the Government of Canada, to the government of a province, or to a particular city, and so on. It's extremely attractive to suppliers.

    That being said, though, this system is aging. That is true. Every one of us will recognize it. The present contract with them is just about to expire. At the same time we're putting together an electronic supply chain. That's going to be part of our government on-line initiative. But it's not quite ready yet, it'll take some time before it's all there together. As I said during my presentation, once we have the electronic supply chain, we will essentially be able to put a bid form on-line. People will be able to access it, people will be able to put in a bid using a electronic signature, put in a deposit through the secure system, transferring that electronically. Then, of course, the bids are evaluated, the winning bidder is announced, the person delivers the goods, and you can even make the payment back on-line to the bank account of the person who supplied the product to the government.

    Perhaps I forgot one or two elements in that, but that's basically how the project will work once it is complete. But we're still two years away from that, and we'll need that time in order to complete it. It is, of course, now 2002, and we're hoping to launch it in 2004. The e-purchasing is already virtually complete, and some of the rest of it is progressing. We want to have it ready by that time, so that we can have the most modern system in the world by the time it's over.

    Mr. Reg Alcock: Can the minister tell me whether or not the department has looked at the Industry Canada SourceCAN service? What is a bit confusing to me is that we have another department of the same government having developed an on-line service that seems to at least provide a foundation for the same kind of service at substantially lower cost.

    In your response, can you also give me a sense of the annual cost to the Government of Canada of the MERX system right now and what the proposed cost is, should you sign the agreement?

    Mr. Don Boudria: The cost to the Government of Canada is almost nothing. It's paid for by the subscribers of the system. It's a few hundred thousand dollars a year that we pay for the entire system. In the electronic and high-tech world, that's not a very large contract, given that it's accessible from one end of the country to the other and so on. It's not the cost to government that is large, it's the cost for the subscriber, a company subscribed on-line.

    The curious thing about the way in which the contract was structured is that it costs less today to have MERX than it did when the thing was originally invented. They have a curious clause in there that makes the price go down every year, and every year the company that owns it loses more and more money. For every dollar they charge, they lose something like three or four. It's not a money-maker for anyone at the present time.

    As for the other question, on SourceCAN, with your permission, perhaps I can ask the deputy to add a few things. We've looked at it. The briefings I was given say it doesn't do a lot of the things we need to do, and of course, it wouldn't associate us with the other levels of government as well.

    Perhaps assistant deputy minister Jane Billings, with your permission, Mr. Chairman, could add to what I just said.

Á  (1140)  

    Ms. Jane Billings (Assistant Deputy Minister, Supply Operations Service Branch, Public Works and Government Services Canada): The SourceCAN site has a lot that's very interesting about it. We have had discussions with Industry Canada to see whether we could truly have one window, because one of our goals is to have one window where suppliers can come in and see all the federal opportunities. At the moment, though, what we need on our bid site is an ability to ensure that we know who has drawn our documents down, and if people have purchased bid documents, that we can get to them any amendments. At this point we can't do that through SourceCAN.

    There are a few other issues that we're dealing with. We have a study with them under way that we've started fast-tracking to try to see what it is we need, what they can provide, and whether we can, in fact, close the gap as we go forward.

    Mr. Reg Alcock: One quick question would concern the cost to a user of MERX today versus the cost, should you re-sign this contract, once the new contract is in effect. I'd like to get a sense of what the escalation in cost will be, if any.

    Second, it seems passing strange to me that we have one government department doing something in this domain and another one, and the two of them are developing independent services. In a world where we're looking for more convergence and more collaboration, more horizontality, if you want to use that word, although I don't like it, why would we be developing two separate systems?

    Mr. Don Boudria: We're developing government on-line so everybody will be together by 2004. It's the exact opposite objective that is in mind. Meanwhile the government has this SourceCAN at Industry Canada, while the one we're using is not a government one at all, but a purchased service from outside the government. Ultimately, though, my colleague is quite right, the objective is to have everything on one system. That's why we're putting together the system we are working on at the present time.

    Your other question was regarding the cost paid now and the negotiations we are presently undertaking for the cost at the other end. The cost now is in the order of something like $6 a month, and we're still negotiating with the supplier. Obviously, it will be more, because as I said, they're losing money with this thing. We're in the process of negotiating with them to carry us through that gap between now and the new electronic supply chain, which will exist in 2004.

    The Chair: Thank you very much, Minister. Thank you very much, Mr. Alcock.

    We'll move now to the Bloc Québécois. Ghislain, you're on deck, 10 minutes.

[Translation]

    Mr. Ghislain Lebel: Minister, congratulations on your recent appointment.

    I would refer you to the notice of meeting we got this morning, indicating a motion I had tabled:

That the Standing Committee on Transport and Government Operations invite the Minister of Public Works and Government Services, Mr. Don Boudria, to appear before the committee to explain what steps he intends to take to ensure transparency in all of the operations of his department.

That is basically why we asked you here this morning.

    I am going to start simply, as the director or president of the Canada Information Office, Mr. McKenzie, is there at your side. You know that yesterday in the House, we were discussing that lost report. It made the headlines. Some nasty comments are being made along the lines that the stock exchange is not doing too well, nor is the NASDAQ, and that if you want to make a good investment, you should become a member of the Liberal Party of Canada, and that the best diploma you can have right now is a Liberal Party of Canada membership card, because that will open all kinds of doors.

    I cannot take issue with what these people are saying, when you consider that what almost all of the companies that deal with the government have in common is the fact that they contribute generously to Liberal Party of Canada coffers. As you said earlier, all political parties need to be funded somehow, and that is how your party has chosen to do it. I respect that.

    My question is for you, Minister, but perhaps Mr. McKenzie beside you can help. Where is the line between a contract signed by the Canada Information Office for a report and the interests of the Liberal Party of Canada as a distinct legal entity? In other words, when a contract was awarded to Mr. Bernier, a university researcher who has made good deals with your department, his document was never disclosed to the Canada Information Office. I will tell you the title: Government marketing, Montreal, February 1998, unpublished and secret.

    When an academic is commissioned to do that kind of work, which is never disclosed, and the contents of which members of the opposition never have the opportunity to learn, what is to stop us from thinking that the work was commissioned for the Liberal Party of Canada but paid for with public money by the CIO? If that is not the case, how are we supposed to know what is really going on in a situation like that? That is one of my first questions.

    The CIO has often entered into this kind of contract that remains secret. The motion this morning calls for the minister to appear for him to tell us what he intends to do from now on to ensure transparency. I hope that transparency begins with disclosure. I would remind this government that if we have paid for something, that should be made known to all Canadians, except for military state secrets, which I understand. But if Professor Bernier is commissioned to do a study, and that study is hidden on a shelf... Sometimes documents are so well hidden that they are never found again. I would like to ask you what happened to that document and many others. There are lots of other documents we have never had the opportunity to look at, outrageously expensive documents. That is my first question.

Á  (1145)  

    Mr. Don Boudria: I thank the member for his question, Mr. Chairman.

    First, with respect to so-called secrets, I indicated in my remarks that contracts are now available even on the Internet, because we are so concerned about transparency. What I want to do is make the system as transparent as possible, and it will never be transparent enough to satisfy me. That is my basic premise. I think everyone who has worked with me in the past, in my prior role, knows that I have always worked that way, in my 26 years of public service. That is how I intend to work this time, like in my last department, and the one before that, and so on. So that is how I intend to work.

    I know a report will be tabled in the House tomorrow. The request for the production of documents took too long. When I became minister, I demanded that it be tabled immediately, right away, and I did the same thing in other departments I have headed. I have nothing to hide from anyone, and I want the documents disclosed to my colleagues as soon as possible.

    Now, where is the line between fundraising dinners for a political party and the role of a government? They are of course completely separate and have absolutely nothing to do with one another. I hope that all those who contribute to my political party, like all those who contribute to all the other political parties, do so because they think the candidates and parties are working for the welfare of those they represent, not for any other reason.

    Some say there is evidence that this was done otherwise. I hope there is no such evidence. At any rate, none of that has been made public. There had better not be any such evidence, because if such accusations prove true, criminal acts may be involved, depending on the level. Rest assured that I am concerned about transparency.

    As far as the competitive process is concerned, in 2001-2002, at the CIO or Communication Canada, since the two were merged, 96% of contracts were awarded through a competitive process: 80% through tendering and 16% through ACAN. The remaining 4% of contracts were awarded without tendering for various reasons. They were speeches requested at the last minute and things like that. I even put a stop to contracts for speeches. I only use in-house services. I do not need outside help.

Á  (1150)  

    Mr. Ghislain Lebel: Thank you, Minister.

    You mentioned accusations. No charges have been laid. Questions have been raised because we are completely in the dark. Everything is kept secret at the CIO, so we can only speculate, conjecture, imagine and think. So rest assured that I am asking these questions in good faith, Minister, and not attacking you personally. As it happens, I have another question for you.

    You say it is transparent from now on and you give me some numbers. Exclusive rights, I understand that. I have a list here. I see that four contracts have recently been awarded. I am talking about your department, Minister. For example, Global Upholstery was awarded a contract. I am not perfectly bilingual, but I think I know what upholstery means. It has to do with furniture and so on.

    It is a contract for $549,000, without tendering. I understand that it is a sole-source contract. So I looked into Global Upholstery before raising this issue here. It is a competition-phobic company, because it once took the Department of Public Works to court before the Canadian International Trade Tribunal. It was actually afraid of its competitors. So there are competitors in that field, and we are talking about $549,000 worth of contracts awarded through a non-competitive process, without tendering.

    I will give some other examples. There is the Wood Banani company. I did an Internet search and found Wood Banani, an electricity consulting firm. We are talking about $120,819. The low amount is the stated reason for awarding this contract.

    I would like to know why sometimes you tender and sometimes you don't.

     I know the criteria. Normally, people say that it is a case of urgency. There may be urgent cases, but do you not think that, for a contract worth $549,000 they could have asked other companies if they could do the work more cheaply?

    I will begin by...

    It was awarded after January 15.

    Mr. Don Boudria: Yes, yes. I will start by answering...

[English]

    The Chair: If you don't mind, we are out of time here. You could respond to these questions later on in the second round, or you may choose to give an answer to the clerk of the committee in writing. I want to make sure every member gets the chance to ask questions.

    Mr. Don Boudria: I'll just say that both of those things are wrong. In fact, they were competitive contracts, both of them.

    The Chair: Mr. Proulx.

[Translation]

    Mr. Marcel Proulx (Hull--Aylmer, Lib.) Thank you, Mr. Chairman.

    Good morning, Minister. Welcome. Thank you for being here with your officials. Welcome to Ms. Cochrane, Mr. McKenzie, Mr. Nicholls and all the officials who are here as well.

    Minister, the Main Estimates indicate that the budget for Communication Canada for 2001-2002 was $50 million. For 2002-2003 it is just a little over $129 million. You have said that Communication Canada was created in September 2001 with the amalgamation of the former CIO, the Canada Information Office, and the former communications coordination sector of Public Works Canada. You had announced at that time that the combined budget would be $125 million, which would come from the existing budgets of the two organizations. Could you tell us what the total budget for this year is and explain the difference between that budget and the $129 million indicated in the Main Estimates for 2002-2003?

    Mr. Don Boudria: Mr. Chairman, there was a newspaper article alleging that the budget had jumped from $50 million to $125 million. That is ridiculous. What was not indicated was that we added the budgets from the other sector that was integrated into the new organization. The two budgets add up to $125 million. So there is no additional $80 million of new money going into this. The way the whole thing was presented was ridiculous.

    So the budget for the last fiscal year was $125 million. In the Main Estimates, the budget for this organization for 2002-2003 is $129 million. So the difference is only $4 million, which represents the transition costs. The government took these two services and amalgamated them.

    A number of operations have been relocated. Most of the offices are now together on O'Connor Street. The telephone reception service is elsewhere in the city, but the administrative offices have been centralized under one roof. There are transition costs for that. Other than that, there has been no increase. Your question was a good one.

Á  (1155)  

    Mr. Marcel Proulx: Thank you very much.

    Minister, you began your remarks by telling us about an initiative to develop an international program to strengthen our country's presence and image around the world. Is this a new initiative? I do not remember hearing about it before. Could you please give us information on that initiative, its mandate and objectives, etc.?

    Mr. Don Boudria: There has always been an international component, but this is a new initiative.

    There are two military procurement offices outside Canada, one in Washington, which I intend to visit later this week, and the other in London, England. They have to do with our commitments under NATO, NORAD, etc. They're involved in coordinating certain approaches to procurement, and so on. So that already exists.

    This new initiative, which is in addition to what I have just described, is aimed at developing the capacity of the public sector, of the government, to gain experience abroad, on the one hand, and, on the other, to share some of our experience with other countries in the world. I will give you an example, without knowing whether it will actually come to pass. We know that sooner or later, there will be reconstruction in Afghanistan, which has been nearly devastated. Could my department make a contribution, with all the expertise that such a large department has in building and repairing bridges, buildings, skyscrapers, docks and so on? I think that we certainly have the expertise to do so. We could also help. Of course, coordination would be done through the Department of International Cooperation and the Canadian International Development Agency, CIDA. I was the minister responsible for CIDA a few years ago. That is not the only example.

    With respect to financial transactions, I am also the Receiver General for Canada. As I joked to my wife, her tax refund cheque has my signature on it. Our experience in managing financial transactions in the public sector has given us expertise that we could share with other countries around the world: our payment and collection systems and everything involved in running a government. Of course, we have all these services within our department. We are the ones who take care of this for the government of the second largest country in the world in terms of area. So we have experience that we can share.

[English]

    If I have a moment later, Mr. Chairman, I'd like to give a brief answer to what Mr. Lebel said, because there are inaccuracies that I'd like to bring to your attention, but I leave that up to the chair.

    The Chair: If we progress rapidly, I'm sure we can do that. I want to give all my members a fair chance, which takes us to Bev Desjarlais of the NDP.

    Mrs. Bev Desjarlais (Churchill, NDP): And I'll be quick, which I'm sure will give you lots of time to respond to Mr. Lebel's question.

    To follow Mr. Alcock's questioning in regard to SourceCAN. One of the things SourceCAN can't do, you said, is retrieve bids or find out who is accessing the bidding process, so that you can get amendments and changes to them. Somehow, when I hear comments like that in this day and age, with all the technology, and you've promised yourself we can go world-wide, we can access 1-800-O-Canada, and we can sing our praises, it just throws me for a loop. I say, cut the computers, let's get rid of it all, because this is a major problem for Canada. We can send people to the moon, but we have a major problem here, because we can't get the amendments to the people who are getting the forms. Certainly, that would be a minor change to a system, as compared to having a whole different system, if we're trying to have one comprehensive program.

  (1200)  

    Mr. Don Boudria: Ms. Billings will add to that in a moment, I'm sure.

    First, SourceCAN is not something our department does. What was asked by Mr. Alcock was, should we switch from the private sector MERX system we are now using to SourceCAN, recognizing that we are in the middle of constructing a government-wide one that will exist for all government departments in 2004? I'll be the first to admit that SourceCAN doesn't do everything we want it to do, otherwise we'd use it now. That's exactly the reason I think, as do, I think, most people, we need a system that will cover everybody, which we're in the process of building. It will be there by 2004 in respect of the purchasing part. The deadline is, as you know, 2005 for everything else, but that part involving procurement by 2004.

    Perhaps Ms. Billings can add to that.

    Ms. Jane Billings: We built and contracted for MERX to help us run the procurement system of the federal government. Industry Canada set up SourceCAN as an information site more generically, and they're designed to do different things. So what we need to do is see whether SourceCAN, even in the interim, can do what we need to do in order to run the procurement business of the government of Canada. SourceCAN could perhaps have some of the functionality if the partner they're in with is willing to do it, and at this point we have no ability to encourage them to do that. We have a contract with CEBRA, Industry Canada has an arrangement with a provider that puts information up on the web. They're quite different concepts, and the issue is whether we can bridge the gaps. We've had MERX in place for quite some time, SourceCAN is a relatively new arrival on the scene, but as I said, we are in discussion with them to see if we can bridge over the gap, because we would like one window and we'd like to get the functionality we really do need to run what is a pretty big business.

    Mr. Don Boudria: One point I'm going to add relates to how good our system is now, because that was a big part of the question. The study made by Accenture, formerly called Anderson Consulting, ranked Canada in 2001 in the number one position on e-government, overtaking the United States and Singapore, who are second and third respectively. We may have disputes on contracting from time to time with different people, but that doesn't mean the evaluations are inaccurate.

    Mrs. Bev Desjarlais: What was the name again?

    Mr. Don Boudria: Accenture.

    Mrs. Bev Desjarlais: Which used to be what?

    Mr. Don Boudria: Anderson Consulting.

  (1205)  

    Mrs. Bev Desjarlais: Gee, I don't know why anybody wouldn't hold weight with Anderson Consulting in the last while. That would have just made me jump up and cheer for joy. But apart from that, I'll accept the report saying Canada's doing wonderfully.

    Certain deals the government has made with its sale of government property and government business have, I think, led taxpayers to believe they may not be getting the best value for dollar or there might be questionable deals out there. Without getting into specific ones, I'm just curious about what little real estate is left around with the Queens Quay West Land Corporation. There's one piece left. What was received for what's already been sold?

    Mr. Don Boudria: I don't have much information about that. The rest would belong to the Canada Lands Company. There is only one property left from the Queens Quay. The objective is to dispose of the property and wind up that corporation. There's only one parcel of land. The larger dispositions of properties are not handled by Public Works, they're handled by the Canada Lands Company, under the department of the now Deputy Prime Minister.

    Mrs. Bev Desjarlais: Under your department, though, how many lands were there in this area? Was there always just one property? Obviously not, there were more.

    Mr. Don Boudria: There weren't very many more. I'll check into that. I'll have to get back to the member.

    Mrs. Bev Desjarlais: I would be curious how many were sold under the previous minister and what the values of the properties were.

    Mr. Don Boudria: If they were sold by Public Works and Government Services or by Queens Quay, I'll be able to answer. If not, I will put in my reply that you should redirect that question to the now Deputy Prime Minister, who is answering on behalf of the other crown corporations.

    Mrs. Bev Desjarlais: Okay, that's good. Thank you.

    That's it, so if there's time, he's welcome to answer Mr. Lebel's question.

    The Chair: Yes, okay. Thank you very much.

    I will move to Alex Shepherd of the Liberals.

    Mr. Alex Shepherd (Durham, Lib.): Yes, thank you.

    Your title as Receiver General doesn't bode well this time of year for a lot of Canadians.

    Mr. Don Boudria: It depends whether you're receiving or sending.

    Mr. Alex Shepherd: One of the commitments from your department has been to move us along in the area of being sensitive to greenhouse emissions and energy sensitivity, especially in the infrastructure of your department. It seems to me I asked this question last year of the Minister of Public Works, and I would be interested to know what kind of progress there has been in making these buildings more energy-efficient.

    Mr. Don Boudria: In the speech I gave at the beginning I indicated that we had, in fact, embarked on such a program. I even gave the numbers of the economies made in the last little while. It's called the federal building initiative. So far we've reduced energy costs by $6.5 million per year. More importantly perhaps, particularly when we're thinking Kyoto and things like that, the reductions are in the order of 50,000 tonnes of pollutants per year.

    We have to realize that with a program like that, in the first years there is always less you can do, because unless you're building something, unless you're renovating something, you're not really saving much energy. When we were in the downsizing mode of government, we weren't really building much. There were very few new initiatives at that time. It's very different now. For instance, in the National Capital Region alone I announced the construction of four new buildings over the last month, two of them on the Ottawa side and two in what is now called Gatineau, one in what we used to call Hull, for those of us who are from there, one for the so-called old Gatineau. Obviously, these buildings will have the most modern standards, because they're replacing existing stock. As we build these two new buildings, one of the very large older buildings right near the building here is going to be put out of commission for a while and completely renovated. I'm referring here to the West Memorial Building, which is almost right across from the Supreme Court, if you know where that site is. Obviously, as we retrofit that building--and it's a very large one--all the modern standards are going to be put there.

    There are other aspects to that, too. For instance, our vehicle fleet has seen a reduction of 53% in fuel emissions since 1994. Twenty-five per cent of our entire fleet operates on alternative vehicle fuels, compressed natural gas and things like that.

    There are savings on paper, if that's considered an example of that; 64% of all government payments are now handled electronically. That saves 20 million kilograms of paper annually. I always wonder about computers saving paper, because they always seems to provide more for us, but in any case, those are the savings from those particular transactions. As of March 31 64% of office waste created by our department in crown-held buildings was diverted from land fill,.

    Finally, one of our facilities I'm very proud of is in British Columbia, the Esquimalt graving dock. It received an ISO 14001, which is the international standard for environmental management. I believe it's the only one we have that has received that very high recognition. I want to take this opportunity to congratulate the people working there for having achieved that status.

  (1210)  

    Mr. Alex Shepherd: Quite often, when we're designing and constructing a new building, it costs considerably more up front to put in these standards. The problem has been in the private sector that the tax write-offs and so forth don't seem to fit in with people's construction costs. It's a lot easier and more cost-effective to save when you do the original purchase, not having a long-range thought process. If you're doing competitive bidding on some of these buildings, is it simply the lowest bid, or are you taking into consideration the longer-term view of energy efficiency?

    Mr. Don Boudria: It's not just lowest bid. There are a number of criteria, location, services for the people who will be moving in there, the standards of the buildings that have to be offered, and so on. All these things are incorporated.

    To give you an example, the Government of Canada has committed itself to reducing greenhouse gas emissions in its own area by 31% by 2010. Our own department is already at 19%, and there are still eight years to go. Of course, as I said, there was considerably less being done in the first year, simply because there was not much renewal of the stock of buildings. A lot more of that is going on right now. Actually, we expect to exceed the target that was set.

    Mr. Alex Shepherd: In the main estimates you mention a couple of the new acquisitions. It shows $341 million of new capital expenditures. Are there some highlights in there? I know you talked about here in the Ottawa region, but it seems a significant increase in acquisitions.

    Mr. Don Boudria: These acquisitions are not all new constructions. I can give some examples where we have actually bought buildings as well. Again in our own city, I can describe the acquisition, for instance, of the former Ottawa City Hall on Sussex Drive, almost immediately in front of the French embassy. That was acquired, not from the private sector, but from the City of Ottawa. There's a building on Sparks Street. Until tomorrow it's called the Royal Bank Building. I've sent all of you an invitation, because I was going to call it something else in honour of a father of confederation, and we're going to have a dedication ceremony for that building tomorrow. That's an acquisition. It's a very large building, as everyone knows, one of the largest ones in this city. The government bought it before I was the minister, about a year or so ago, and it's now going to be part of that inventory.

    Those are just some of the examples of acquisitions. Obviously, when you're acquiring a property, as opposed to building one or having one built for you, you acquire the building in the state it's in. So the acquisition of it doesn't necessarily create savings, in energy or otherwise, unless, of course, you're acquiring an almost new building and you're replacing a much older one, where, I guess, you would be, by square footage, probably having far greater insulation factors than you did in the other. But it doesn't automatically generate the kinds of new standards a new construction does, nonetheless.

    The Chair: Thank you very much.

    We'll go to Mr. Pankiw of the PC/DR.

    Mr. Jim Pankiw (Saskatoon--Humboldt, PC/DR): Thank you, Mr. Chair.

    One of the many things that brought the reputation of Stockwell Day into disrepute was the over $500,000 he cost taxpayers by making ill-advised libellous statements. The law office that handled that case kicked back $70,000 to the Canadian Alliance. We have here a contract worth more than $500,000 with a Quebec company and a kickback of $70,000 to the Liberal Party. Is this $70,000 amount an industry standard in political kickbacks, or is that just a coincidence?

  (1215)  

    Mr. Paul Szabo (Mississauga South, Lib.): On a Point of Order, Mr. Chairman, the committees operate under the same rules as the House. There are rules of decorum, there are also the rules that we don't make allegations or charges against other members in this way. The parliamentary rules should be followed. Kickbacks are illegal acts, Mr. Chair, and I think it's unparliamentary for the member to make those suggestions before this committee.

    Mr. Jim Pankiw: It's not an allegation, it's a statement of fact.

    The Chair: Gentlemen, the reason there's a chair is that the answers go back through the chair, or it becomes a two-person affair. It's important that we keep it civil and that we do use parliamentary language.

    You have the floor, Mr. Pankiw.

    Mr. Jim Pankiw: My point, Mr. Chair, is that it's obvious this is taking place.

    Let me ask you this. Mr. Minister, did you say that 96% of the contracts awarded are open for competitive bids?

    Mr. Don Boudria: It was 96% in the case of Communication Canada. It's actually 92% for Public Works and Government Services.

    Mr. Jim Pankiw: I've been given information--and I don't know if this is correct, but I'm sure you can answer it--that since you became the minister, about 50% of the contracts awarded have gone without tender, and that--I don't know if it's a rule or a guideline--any contract worth more than $25,000 is supposed to be not sole-sourced, but open to competitive bid.

    Mr. Don Boudria: Okay, let me answer some of this, Mr. Chairman. Let me start with the previous question.

    Two contracts were raised. In fact, the information was wrong about both of them.

    Mr. Jim Pankiw: I'm not asking about those, I'm asking if contracts worth more than $25,000--

    Mr. Don Boudria: Mr. Chairman, I didn't tell the member what to ask, perhaps he shouldn't tell me what to answer.

    Mr. Jim Pankiw: Well, you should answer my question.

    The Chair: Order.

    Mr. Don Boudria: Mr. Chairman, I'm giving examples of the inaccuracy of--

    Mr. Jim Pankiw: Mr. Chair, my question's very specific. Are contracts worth more than $25,000 being sole-sourced, and if so, why? That's my question.

    Mr. Don Boudria: Am I answering, Mr. Chairman?

    The Chair: Okay, one question after the other.

    Mr. Minister, would you respond to the question.

    Mr. Don Boudria: There were a number of questions raised, and I'll answer them all.

    One of them had to do with examples of government contracts. Two examples were raised earlier, they're both incorrect. In fact, one of them, the Ottawa-based company, was--

    Mr. Jim Pankiw: Mr. Chair, he's eating up my time and not answering my question.

    The Chair: Mr. Pankiw, the minister has it. Hopefully, he will respond to your questions in a timely fashion. He has the floor right now.

    Mr. Don Boudria: One of them involved, in fact, a standing offer agreement, so it's fully competitive. In other words, the contract is given at the end of the year on standing offer. Say it's to supply pencils, and they're 25¢ each, you draw down as you need them.

    Mr. Jim Pankiw: Mr. Chair, I'd like to move on to another question, because he's not answering this one.

    Mr. Don Boudria: The second one was an ACAN, an Advanced Contract Award Notice. Between ACANs and the tenders--

    Mr. Jim Pankiw: Mr. Chair, I want to move on to another question, because he's not answering my question.

    Mr. Don Boudria: --it's actually 92% of the contracts that are awarded competitively, which leaves 8%.

    In regard to the amount, $25,000 is certainly one of the thresholds; that's for procurement of goods. For architectural and other such services, the amount is $100,000. It's not quite the same in every respect. In some cases it's $25,000, in some it's $100,000, and I believe for some services, mainly print, there's another threshold, and I'll find it in a minute.

    But anyway, there are those two thresholds; the one for restoration work and things like that is $100,000, but generally, the member is right, it's $25,000.

    The Chair: If you keep your questions short, I'll ask the minister to keep his answers short. That way you can have as many questions as possible, but the interjecting doesn't help your time. So ask your questions, and I hope we will get short answers.

  (1220)  

    Mr. Jim Pankiw: Is it the case that half the contracts that have been awarded since you became minister have been sole-source contracts?

    Mr. Don Boudria: No. Since I came into office, my department has awarded, as of yesterday, 8,311 original contracts, total value $1.1 billion; 2,821 were valued over $25,000, of which 445 were awarded non-competitively. These involved mostly such things as high security, computer systems, things of that nature.

    As for contracts I've signed personally, I said this morning to the media that I have signed seven. In fact, that's not accurate, I've only signed five since I've been the minister.

    Mr. Jim Pankiw: The committee will be dealing with a motion, when your testimony here is concluded, to strike a subcommittee to investigate the breaches of the conflict of interest code by the former Minister of Public Works. I would like to know if you're supportive of this committee's doing that.

    Mr. Don Boudria: Mr. Chairman, it would inappropriate for me to tell this committee how to do its work. I have nothing but respect for all the members of this committee. They are quite capable of taking important decisions, and the minister should not interfere with their making the wise decision they no doubt will make.

    Mr. Jim Pankiw: Mr. Minister, when you were the opposition critic on public works, in questioning the government, you wanted to know what the minister intended to do to avoid activities or situations that place public office-holders in a real or potential conflict of interest. This is what we've seen with the former Minister of Public Works. Obviously, the current government is not acting on your suggestions that measures should be put in place. Are you going to be doing anything, in light of past breaches of the conflict of interest code, to prevent that type of conduct in the future?

    Mr. Don Boudria: It's an interesting question how much we've improved the system since the Conservative government was there. I'll gladly answer that question, because the honourable member has just stated that I was the opposition critic at the time.

    I'm very pleased to see that we have 92% of our contracts competitively awarded. If we compare that with other G-8 countries, we're one of the highest. Let me give you some figures here from the 1997 statistics, and they've been improved since then. The reason I use 1997 is that the comparisons with other countries aren't available beyond that. In Europe it was 63%, in the U.S.A. 63%, and in Japan 73%. So we've certainly improved that considerably.

    As for the conflict of interest rules for public office-holders, of course, they do exist. Actually, the blue book of former Prime Minister Brian Mulroney was put in place following the number of questions that many people, including myself, asked at the time. Since then, of course, an ethics council was established by the Prime Minister when he came to office in 1993. There are also, for instance, clauses in our bidding process at Public Works and Government Services Canada that didn't exist under former governments, whereby you cannot have a contingency fee for lobbying in order to get a government contract. That's illegal now. Those are all measures that have been put in place since 1993, and I'm happy that the honourable member has raised this question, because it gives me a good chance to talk about some of these improvements.

    But overall, Mr. Chairman, I want to be as transparent as possible with all colleagues, to receive favourably any recommendations they have for making the system better, and to have appropriate processes that can even be improved in the future.

    As to other comments that were made, whether there were kickbacks or the like, accusations against the leader of another political party, Mr. Day, I don't think I want to get into that.

    The Chair: You're out of time.

    We'll move to André Harvey. We're into five-minute rounds now.

  (1225)  

[Translation]

    Mr. André Harvey (Chicoutimi--Le Fjord, Lib.): Thank you very much, Mr. Chairman.

    Minister, I would first like to say that you have a reputation among all your colleagues for making yourself very available to your staff and to all of us.

    I appreciated the comments you made in response to the question asked by my colleague, Mr. Lebel. You said that financing a political party came under another committee. Still, I am pleased to note that you have done an enormous amount of work in that area. The Bloc Québécois, for its part, has made itself very unpopular because of a principle that seemed very important to it at the time, that is, grassroots financing. Unless I am mistaken, they seem to have backed away from that principle. It is important to stick to one's principles.

    That said, I would like to ask you a question of principle about the Canada Communications Group. I am an elected member of the Canadian Parliament and when I see Communication-Québec's strategy, I find that their approach is extremely subliminal and is obviously aimed at playing up the good things that the Quebec government has done. I think that other governments in Canada do the same thing.

    I would like to hear you explain the principles that you are applying with respect to this new corporation headed up by Mr. Mc Kenzie, which will no doubt enable us to draw attention to what the Canadian government is doing on behalf of all Canadian citizens. We are not here to hide what we are doing, especially our achievements. I would like to know what your philosophy is, as you take over the Public Works portfolio, and what principles you intend to apply to the Canada Communications Group.

    Mr. Don Boudria: First of all, Communication Canada has about four roles, which are very important. Yes, we do have the 1-800-O Canada, which is one service. People call to find out how to go about obtaining a passport or what to do if they lose their employment insurance cheque. These are the types of questions people ask. Under certain circumstances, people can even call from outside the country to get information on the services offered by the government of Canada. So that is one component. It is a service provided to Canadians.

    A second component is the Sponsorship Program. Members of Parliament from all sides of the House come to see me to talk about the Sponsorship Program, for events at which they want the Canadian government to have a visible presence. This is true of all the parties. Requests come from all the parties, from the Bloc Québécois and the others. That is the second part of the role.

    The third is the Fairs and Exhibitions Program of the government of Canada, which is very well received. I gave the example of the Calgary Stampede and the International Plowing Match. I could also mention some of the major festivals in Montreal or the Home show, for example, or other similar activities. The event may happen within a building, where we have these huge stands where people can go to apply for a job with the Canadian government. People who want information on how to start a small business can obtain it here, and so on.

    There is also the ministerial visits program, which coordinates travel by ministers to hear the complaints and views of elected municipal officials, community groups, and so on. In this case again the objective is to provide a service to Canadians.

    I come back to the 1-800 O-Canada number, to the Canada site on the Internet, which receives 36 million hits a year. That shows you how much people use this type of service. In addition, there is the Canada Gazette, the Queen's printer, Publiservice, and finally all the other things Communication Canada does to provide service to Canadians.

    This may be quite surprising, but everything I've just described and even more is done with a staff of 700 people for the whole country. That is not very many considering all the services provided.

    In addition, we handle the placement and co-ordination of advertisements for the government of Canada. We have to ensure, Mr. Chairman, that we do not have advertisements for different programs every two minutes on television. The second ad would cause people to almost forget what they had just heard in the first ad. So we need a system to co-ordinate these services, whether it is for the anti-smoking, anti-drug or other such programs offered by the government of Canada.

    I have given just a few examples. I could discuss this further, but the chairman is telling me that...

  (1230)  

[English]

    The Chair: Thank you, Mr. Boudria. We have some anxious people here, and I'm trying to give everybody a fair shake.

    I will go to Mr. Goldring, and then back very quickly to Mr. Alcock, if he would share his time with Mr. Normand. Then I want the Bloc Québécois to have a chance to ask questions.

    Pete.

    Mr. Peter Goldring: Thank you, Mr. Chairman.

    Mr. Minister, I appreciate the forthright candour in your responses. I don't wish to belabour this point to the nth degree, but I do need an answer to it. It is about this report. We just find it incredible that neither the supplier nor the government keeps a copy of this report. As a matter of fact, the supplier of the report indicates that they normally don't keep a copy of it beyond 18 months. After being in business for over 30 years and having thousands of files of projects we have contributed to, we keep those files. I find it hard to believe that a company does not.

    So my question to you, Mr. Minister, is simply, is it possible that the document was never produced?

    Mr. Don Boudria: Given that I've never seen the report, I don't know how I could answer either way. With respect, Mr. Chairman, to our colleague, he has to ask these very probing questions, it's his solemn duty and I totally respect that, but if I haven't seen the report, how can I swear on a stack of Bibles that it exists? What I am saying, though, Mr. Chairman, is that there are two reports. One of them is here, to be tabled in the House tomorrow, pursuant to a request made by an honourable member. The second one I have here in front of me. I can't table this with you today, because it's not translated. But members can view it, make photocopies, I can arrange for officials to meet with them, everything. I'll gladly do that. I have the interim payments that were made at every step when the report was produced. I have the supporting documents for the report that was produced. Obviously, all those things were produced. I can see them, they're in front of me, and I'll share them with colleagues at any time.

    Is it wrong that I don't have a copy of the report? Of course. If I had the report, I wouldn't have to answer all these questions, so obviously, I wish I had the report, and I'm not going to say that it's perfectly normal that it not be here. It would be a little hard to believe.

    As for the industry standard that is alleged to exist, whereby after 18 months they don't keep those things, I'm informed that is the standard. If that's short, I think it is too. The first thing I said when I found we didn't have one is, that's no problem, just phone the people who prepared it and tell them to send another one by Purolator, and we'll have it tomorrow. I was told, no, they don't have it any more. I wasn't particularly amused, after we paid that kind of money.

    Mr. Peter Goldring: Well, Mr. Minister, many Canadians would find it unbelievable that these documents aren't retained. Even with our own offices here in Parliament, I assure you that I keep major documents and major papers I've been working on, and I have kept them from my very first day here.

    Mr. Don Boudria: So do I.

    Mr. Peter Goldring: From a business background and from a parliamentary background, the public simply finds that very difficult to believe. So I repeat the question: is it possible that the report was never produced?

    Mr. Don Boudria: Mr. Chairman, I've answered that question, I believe. There is supporting information here on the production of the report, on the contract, on adherence to Treasury Board rules regarding the contract's structure, the interim payment schedule, the certification pursuant to the Financial Administration Act by a senior civil servant saying that in fact, the work had been done. So I have to answer the question on the strength of that, not through having seen the report, because none of us in this room, I believe, has seen it--if anyone has, please give me a copy.

  (1235)  

    Mr. Peter Goldring: Minister, am I to assume, then, that you are saying the report was produced?

    Mr. Don Boudria: I've answered that question as well. Mr. Chairman, whether the question is answered from east to west or west to east, it's the same answer, and I don't mind repeating it again and again. I recognize that it is the duty of colleagues to ask the probing questions they are obviously asking. I have before me the contract that was signed. I have the schedule of payments relating to development of the contracts. I have certification signed by a senior civil servant pursuant to the Financial Administration Act--that's the law. The progress payments were being made, and the final payment was made consequent upon the work's having been done. And finally, I have the documentation accompanying the final product, but not the final product itself.

    The Chair: Mr. Goldring, your last question.

    Mr. Peter Goldring: I'm wondering, Mr. Chair, if we could have those documents tabled, so that we could take a look at them and review them to see what proceedings have taken place and at least reassure ourselves that there has been active work on that file.

    Mr. Don Boudria: Mr. Chairman, I'll have to refer to your clerk here as to whether or not documents that haven't been translated can be tabled. I don't know what the answer is to that, but if it's a matter of making it available to members individually, I gladly will. If it's acceptable that it be tabled in that form, I will do that too. If it is not, I'm willing to have them translated and tabled then. Either way the committee wants it, the answer is yes.

    The Chair: Okay, we have the answer. The committee will get it in one form or another, and individuals can approach for briefings.

    We'll move on to Mr. Alcock. It would be nice if you could let Mr. Normand share your time, because I'd like to get back to Monsieur Lebel for the final question.

    Mr. Reg Alcock: I have one tiny question, and you don't need to answer it right now. I wonder if the minister will undertake to have a table produced that indicates the average cost to a small business of transactions on the MERX system. You gave us the monthly cost, but there's also additional cost for each time you use it. Could you give us the average cost to a small business today and the estimated average cost with this new two-year contract? If you can produce that table, you can forward it to the committee at a later date.

    Mr. Don Boudria: Certainly, Mr. Chairman. I could perhaps do that in two steps. We could produce immediately for the clerk and the chairman what the actual cost is today, averaged for certain industry groups and so on. Then, once we complete our negotiations and sign the new agreement, we can produce an update of what the fees would be at that time, in order not to delay the committee and give information as soon as it's available.

    The Chair: Mr. Normand, a quick question.

[Translation]

    M. Gilbert Normand (Bellechasse--Etchemins--Montmagny--L'Islet, Lib.): My question is on a completely different area, Minister, but it is related to your statement. You are responsible for an organization called Defence Construction Canada, and I see that for the next five years, $340 million have been set aside to do some environmental improvement work on the 21 radar station sites. That amounts to approximately $70 million a year, or $3.3 million per site. This, in turn, amounts to $16 million per site over the five years.

    The question I have is this. Why are we spending so much money on these sites, when we know very well that Defence Construction Canada has a number of sites within municipalities at the moment that need some work to improve the environment? I'm thinking of Valcartier, Bagotville, and here we are spending $340 million for 21 sites in the far North. I have visited two or three of them myself, and I did not think the situation was that bad.

    Mr. Don Boudria: With your permission, Mr. Chairman, I will ask Mr. Ross Nicholls to reply to the question.

[English]

    The Chair: Okay.

[Translation]

    Mr. Ross Nicholls (President and Chief Executive Officer, Defence Construction Canada): It is up to the Department of National Defence to decide how to spend the money in its budget. We are doing environmental improvement work in the northern locations in accordance with arrangements made with Inuit and Inuvialuit associations. So separate funding is provided for these arrangements.

    In other locations in southern Canada, there is an environmental improvement program managed by the department to clean up contaminated sites throughout the country. I cannot tell you exactly why or how the department establishes its priorities for these sites, but I do know that the department does have a list of priorities, and that money is spent according to these priorities.

  (1240)  

    Mr. Gilbert Normand: I know we are facing a number of problems in various municipalities and that we do not have the money to deal with all of them. I see that $16 million will be spent on each site over the next five years. I think that is a lot of money, given that we have priority problems in areas where human beings are living, rather than caribou or polar bears.

    Mr. Don Boudria: Mr. Chairman, the honorable member raises a very interesting point, but we have the following problem: we are the implementation agency, not the decision-making body as regards the work required to clean up these environmental problems. The decision-making agency is the Department of National Defence, probably, in some cases, in cooperation with the U.S. government as well, because these bases were developed with the cooperation of the Americans initially, at the beginning of the Cold War.

[English]

    The Chair: Colleagues, we are quickly running out of time. Madam Desjarlais, if you have a very quick question, Monsieur Lebel would have the last question.

    Ms Bev Desjarlais: Okay. It is very brief.

    As this was such a high-cost report, I'm curious as to who received it and whether anyone actually read it.

    Mr. Don Boudria: Do you want me to take all the questions and answer them all at once, because we're ending the meeting? Or should I answer them as I go?

    The Chair: Let's just do that.

    A quick question from Mr. Pankiw, then.

    Mr. Jim Pankiw: Thank you.

    I just want to say, Mr. Chair, that I'm not making any allegations or questioning the integrity of the minister at all. When he says he wants to be as transparent as possible and make the system better, that is entirely consistent with what he said on August 31, 1988:

Nevertheless, as an opposition Member, if we on this side of the House, or for that matter, a government Member is of the opinion that another Member has in any way abused the privileges that were given to him or her by the electors, it is of course his or her duty to report that publicly in order that the people of Canada can judge upon it.

    In questioning the Deputy Prime Minister about serious and credible allegations of conflict of interest, he asked:

Can he specifically tell the House whether he is willing to refer this matter to a parliamentary committee? There have been a number of such allegations made by very credible sources, this time by one of his colleagues. Isn't that enough?

    So my question to the minister is, if it was appropriate in 1988 for a minister to initiate a parliamentary committee review of circumstances pertaining to conflict of interest allegations, why is it not appropriate in 2002?

    The Chair: Thank you.

    Monsieur Lebel, do you want the answer to your question, or do you have another question to add?

[Translation]

    Mr. Ghislain Lebel: Yes, I definitely do want to add something. Earlier, I mentioned two contracts to the minister: Global Upholstery Company and Wood Banani, and he told me that they had been awarded following a tendering process. However, I have two sheets here from his department that discuss the way contracts are awarded or the way parties are invited to bid. They refer to the “non-competitive” method. Which is correct?

    Earlier, the minister said that he had awarded some 8,000 contracts, over 8,300 contracts, and I have here a list, dated yesterday, of 3,338 contracts that were awarded through a non-competitive method—I no longer dare say without any calls for tender. There are 1,485 contracts awarded on the basis of an exclusive right. That is why the competitive method was not used. There 1,615 awarded on an exclusive value basis. That amounts to almost 50%, Minister, of the 8,000 you signed.

    I would like you to tell me something. In the final minutes of his 10 years, your predecessor signed a contract for $50 million for renovations to the Library of Parliament. You signed it?

    Mr. Don Boudria: Yes, I signed it.

    Mr. Ghislain Lebel: The estimates we agreed on here were approximately $30 million. How did the figure jump from $30 million to $50 million without anyone noticing? I would like to know who was awarded this contract. I would also like to ask you, Minister, whether your predecessor was involved in this decision.

    Finally, it has been decided to change the location of Revenue Canada in Laval, Minister. Revenue Canada has been in this complex since 1985. There was a call for tender, and Garadex Inc., the second lowest bidder, was awarded a contract for $7.5 million more than the lowest bidder, the current tenant, after it spent $1.2 million on wiring the building less than a year ago. In addition, those concerned will have to move elsewhere. How can such a decision be justified?

    Those are my questions.

[English]

    The Chair: Mr. Minister.

[Translation]

    Mr. Ghislain Lebel Don't you think that is enough?

  (1245)  

    Mr. Don Boudria: Seriously, Mr. Chairman, I will answer the questions.

[English]

    About the report, Ms. Desjarlais asked if we know whether the civil servant who signed the authorization for that report, who has, as I said, since retired, read the report or not. It would be difficult for me to say. The only source I have is one that comes from the media this morning, where the individual was interviewed by a reporter. The individual said to the reporter he had not only received, but consulted the report in question. I haven't spoken myself to the retired civil servant in question.

    With the question of Mr. Pankiw as to whether or not we should discuss these issues in committee, I believe that is where I am right now. I'm always pleased to attend a committee. When I was invited initially, there was no hesitation. My parliamentary secretary, on my behalf, indicated my enthusiasm to appear before the committee and to be forthright with all colleagues, which is certainly what I'm here to do.

[Translation]

    With respect to the two contracts mentioned by Mr. Lebel, I would say that the two are somewhat different. One is a standing offer, that is a contract awarded at the beginning of the year. The honorable member knows very well how that works. We draw on the contract, if you will; this is one type of contract. We do not draw on the main contract every time. There is no new bid, there is one bid to cover the whole year. That goes for the first case, the firm in Ottawa.

    The other case involves the use of the ACAN formula, which is competitive. When someone offers us modular furniture and there already is some in the office and we want to add to it—and this is in fact what happened—we go to the same company and put this on the computer. If some other company thinks it can offer the same service and wants to challenge, it can do so. There was no challenge received in the case of this company. I found out about this. The notice was posted on MERCS for the required 15 days, and there were no challenges. There were no rejected challenges; there were none at all. None at all.

    I am the person who announced the contract for the Library of Parliament, not my predecessor. I did it in the Library of Parliament—the members of the Board of Internal Economy were there with me—and the contract went to the lowest bidder. In fact, the leader of the opposition had his picture taken with the Fuller family, which got the contract as the lowest bidder.

    The Fuller family is a contractor, a company in the west end of Ottawa, and they are the great-grand-children of Thomas Fuller, who was the architect or one of the architects of the Library of Parliament. This company was the lowest bidder without any doubt. There were other bidders, and the bids were evaluated. The second lowest bid was several million dollars higher than the one chosen. An independent assessment of the bids was carried out to determine if there were enough bidders to ensure transparency, in order to determine whether there could have been collusion or whatever. This assessment was carried out, and it was found that everything had been done properly. And the lowest bidder was awarded the contract.

    I must admit that I am less familiar with the contract in Laval, but I will find out about it. I have just been handed a note from my officials. They say that there was a competitive process and an evaluation, done by someone we call a fairness adviser. The contract was awarded following this evaluation. I will be pleased to provide a more detailed answer in writing for you and all committee members, Mr. Chairman.

    With that, I would like to thank you for inviting me to appear before your committee. I would like to tell members of Parliament that I am very comfortable receiving constructive suggestions from the committee for any improvements that could be made to the system. I will be pleased to consider the suggestions, provided they are constructive, possible and good for the taxpayers of Canada. I was in the opposition for a long time, and I acknowledge that members of Parliament must sometimes ask questions that may be difficult. That is their job, and it is in fact a sacred responsibility: they must ask questions. This is the job of members of Parliament, provided they carry it out with good taste. I thank you for your questions and I look forward to working closely with you and all the members of the committee in the future.

    Thank you.

  (1250)  

[English]

    The Chair: Thank you very much.

    Mr. Jim Pankiw: Mr. Chair, my question to the minister was not about his appearing here.

    The Chair: This section is over, Jim, and we're going to move to the next section very quickly, which is the motion of which Val Meredith gave us the 48 hours notice. As soon as the officials clear, you can read that into the minutes, and then we'll debate and vote on it.

    Mr. Jim Pankiw: The motion before the committee is that members of the Standing Committee on Transportation and Government Operations strike a subcommittee to investigate breaches of the conflict of interest code by former public works minister Alfonso Gagliano and his staff, and to report back with recommendations that endeavour to eliminate inappropriate political interference that has plagued the Liberal government's administration of Canada's crown corporations.

    The Chair: Colleagues, we have a motion on the floor. Do you have any discussion of it?

    Mr. Jim Pankiw: Mr. Chair, this was my question to the minister, which he either intentionally or inadvertently avoided answering. When he was the critic in the 1980s and there were allegations of conflict of interest, he said the parliamentary committee should conduct a thorough investigation. In fact, he went so far, on May 1, 1986, as to ask the Deputy Prime Minister how he could tolerate such interference in not conducting a proper investigation through the parliamentary committee. So this would be consistent with what the minister himself has stated in the past. We know there were breaches of the conflict of interest code, and the committee has an obligation to strike this subcommittee to investigate the extent of political interference and to make recommendations to prevent it in the future.

    The Chair: Thank you very much, Mr. Pankiw.

    Are you ready for the question?

    (Motion negatived: nays 7; yeas 2)

    The Chair: Colleagues, I have one more quick thing. You've got the work plan from the clerks. We're not going to deal with it today, but could you put in any information you have about conflicting dates or anything like that, so that we can have it rounded off and expedite our program.

    Thank you very much. We're adjourned until Thursday.