[Recorded by Electronic Apparatus]
Wednesday, May 3, 1995
.1532 
[English]
The Acting Chairman (Mr. Easter): I call the meeting to order.
I welcome Dr. Dittberner again.
For those who were not at the previous committee meeting, this is the second session we've had with this group.
Would you please introduce your people?
Dr. Gordon Dittberner (Assistant Deputy Minister, Corporate Services Branch, Department of Agriculture and Agri-Food Canada): Thank you very much, Mr. Chair.
From Agriculture and Agri-Food, I'd like to introduce Dennis Kam, the director general of finance and resource management; Stephen Silcox, the director of planning and resource management; you'll recall Bob Caron, the senior corporate financial planning officer; and Dick Robinson, the chief of operational planning.
I will take just a brief moment to say our purpose today is to continue the technical part of the briefing on part III of the estimates. It's a follow-up to our meeting on April 25.
If I can recap for a second, last time we went through an explanation of the three parts of the estimates process. We gave a detailed presentation by Dennis Kam on the new expenditure management system, and we provided a brief outline of the part III document along with a brief outline of the outlook document.
We gave three hand-outs. One was the little plasticized guide of how to use the part IIIs. We also had a one-page sheet, which dealt with some of the changes in the part IIIs for 1995-96. There was also a short résumé of the new expenditure management system. In addition, we handed out our remaining copies of the part III book and some of the remaining copies of the outlook document, which is called Securing our Future.
Hopefully everybody still has their copies. If we have them here, it will make it a little easier as we go through the part IIIs if we can refer to them.
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For today I propose to have Mr. Bob Caron go into a little more detail on this book on the part IIIs to clarify what the numbers mean and how you can make the best use of the tables in them.
After that, we may want to deal with some questions specifically. If there is adequate time afterwards, I'll ask Mr. Silcox to provide some copies of tables that will give us a bit of an outline of the trend of the future spending by program activity. I think that will be useful in preparing you for your meeting tomorrow and of course for future discussions with the minister and the department.
I'm going to turn the presentation over to Mr. Caron, who will lead us through the part IIIs again.
Mr. Robert P. Caron (Senior Corporate Financial Planning Advisor, Department of Agriculture and Agri-Food Canada): Thank you for having us here one more time.
At our last session we went through part III quite quickly. I thought we might go through it more slowly today. I hope each of you has a copy of part III. I will be referring to the part III English pages, but I will give you the French pages for those who would like them.
As I mentioned last week, part III is broken down into three sections. Section I provides a quick reference to the issues facing the department.
[Translation]
Section II provides a breakdown of program activities and sub-activities.
[English]
Section III provides additional resources and statistical information for the program.
There is also an overview of the other ministerial responsibilities within the Agriculture and Agri-Food portfolio, such as the Agricultural Products Board, the Farm Credit Corporation and so on.
Since we already went through this last week, I thought we would start off in section I of part III, on page 1, which is the program overview. If you have that particular section, you'll notice figure one is called ``Planned Resource Requirements for the Agri-Food Program''. These numbers are consistent with page 11 of the Securing Our Future document.
The 1995-96 column of planned numbers includes $172.5 million for budget initiatives that were not included in the main estimates, but will be appropriated through a supplementary estimate.
The Acting Chairman (Mr. Easter): I have a question on that point. You said the numbers are supposed to compare, and they don't. With $172.5 million they might, because I never added that in, but on page 10, the total program number is $1,762.9 million, and on page 1 it's $1,998.1 million. So the $172.5 million comes in?
Mr. Caron: On page 10, the $1,762.9 million are the appropriated dollars, whereas on page 1 they are the appropriated dollars plus the $172.5 million.
The Acting Chairman (Mr. Easter): What is the $172.5 million made up of? I don't want to confuse you.
Mr. Caron: I don't have a breakdown of the $172.5 million, but I believe they are all safety net numbers.
The Acting Chairman (Mr. Easter): Thank you. We'll follow that up with the department.
Mr. Caron: The last point on page 1 is that the 1996-97 and 1997-98 numbers are planned expenditures, and they're there for your benefit.
Pages 2 through 9, pages 2 à 11 en français, provide you with a quick reference to the environment in which the agricultural sector must function. You'll note the tables have been broken down into certain categories, such as ``Trade and Market Development'', ``Adaptation and Rural Renewal'' and so on.
.1540
If you look at page 2, ``Trade and Market Development'', what you'll find are the external influences on the agricultural sector. We've tried to give you the effects these influences will have and any strategic responses the department is contemplating.
There are also the key operational responses, which are specific program responses. We've tried to give you the page where you might be able to find, within part III, those particular responses. For example, the agri-food trade service is spoken about on page 110. If you go to page 110, you'll be able to find a little bit of what we're talking about under agri-food trade service.
[Translation]
Refer to page 118 of french text.
[English]
This continues all the way through pages 2 to 9.
If you have any questions, please feel free to ask them. If I cannot answer, one of my colleagues certainly can.
Dr. Dittberner: Those are brave words.
Mr. Caron: We can go to page 10, à la page 12. What you'll find on page 10 is the number $1.762 billion, which is a number you're all familiar with. These are the total appropriated resources in 1995-96. They're displayed by vote and then statutory items.
These items on page 10 are also displayed on page 12, à la page 15, but they're displayed by activity. We've tried to give you a different perspective on that $1.762 billion.
On page 10, the items identified as votes 1, 5, 10 and 15 are items that Parliament will be asked to vote on. The statutory items, which are reflected in brackets with an ``S'', have already received parliamentary authority through passage of previous legislation and are only included here for information purposes.
If you refer to page 13, à la page 16, again you'll notice, in the lower right-hand corner, that number, $1.762 billion. This is again a breakdown of resource requirements, as reflected in figure 4, but this time it's broken down by organization to give you a better idea of what the organization requires.
As an example, under ``Corporate Management and Services'' on page 12, there's a total requirement of $58,103,000, which is part of our total appropriation. That $58 million is broken down, on the following figure, into ``Executive Offices'', ``Audit and Evaluation'', ``Human Resources'' and so on. It's broken down by organization to give you a better perspective of what we're looking for.
Let's go down to page 19, à la page 22. Figure 10 on this page is a program resource summary, and our number, $1.762 billion, is at the bottom of the page. This is the appropriated amount, and it's the same as the numbers we found on pages 10 and 12, ou aux pages 12 et 15. For comparison purposes we've provided similar information from 1993-94 on this particular figure.
The activities are further broken down into sub-activities. For example, let's look at page 22, ou à la page 25.
In this particular figure I'm looking at agricultural research and development activity. That activity is broken down into sub-activities. The total activity on page 22 shows $276,052 million. We can tie that particular number back to page 19, under ``Agricultural Research and Development''.
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On page 21 we start section II with an analysis by activity. What we've done is provided each activity. The first one is agricultural research and development, and they continue throughout section II.
[Translation]
Right after the financial data, the reader has, at page 23, a breakdown under performance information and resource justification. In this budget, the department also provides that information for the years 1995-96 to 1997-98. It can be found at page 24.
The present performance is the performance for the last year. It is examined by sub-activity. I give you an example.
[English]
On page 24, you'll find information on resources that have to do with fiscal years 1994-95 up to 1997-98.
[Translation]
The paragraph following the table gives detailed information on the distribution of these resources.
At page 27, the information on previous years' performance by sub-activity continues. There was an example of that on page 22.
The resource requirements are mentioned in the sub-activities. For example, we have biotechnology on page 30. Even if biotechnology is not a sub-activity as such, it is shown because it is a very important part of most sub-activities.
[English]
The structure that's presented in ``Agricultural Research and Development'' is also followed when providing information for each of the other activities within the agri-food program. Once you master the breakdown in this particular activity, you can move on to the others and it's the same way.
We'll go to section III, which is on page 166, à la page 178. The information in figure 69 is on general areas of expenditure at the program level. We've provided these by object of expenditure to give you a better idea, again, of the breakdown of that $1.762 billion.
.1550
What I mean by ``object'' is, for example, personnel, which we break down into salaries and so on, or the goods and services area, which we break down into the expenditures we anticipate on transportation, information or professional and special services.
Dr. Dittberner: It's really just another cut at the way expenditures are displayed. This is not my specific branch; this is right across the department. It's just another cut.
Mr. Caron: On page 167, à la page 179, figure 70 gives you details of personnel requirements. What we've tried to do here is give you an idea of the full-time equivalents that Agriculture and Agri-Food requires in 1995-96, broken down by category and group. We also provide the average salary for 1995-96 for each of the FTEs in this particular category and group.
At the bottom of figure 70 on page 168, à la page 180, you'll notice that the estimate for 1995-96 is 10,769 full-time equivalents. You probably remember seeing that same number on page 19, à la page 22.
The Acting Chairman (Mr. Easter): Before you leave that section on personnel requirements, I'd like to ask something. ``Full-time equivalents'' are not actually people. Is there anywhere we can find the numbers in terms of actual people?
In my case, when I'm looking at so many full-time equivalents being lost, I find out that sometimes one full-time equivalent is actually equal to four people working three months apiece. So it gets more serious than it looks with the personnel cut-backs on the ground, because that's where the seasonal work actually takes place. So is there anywhere we can find those numbers?
I'm not going to quibble over that lack of detail, because anybody who criticizes the lack of detail here is off the wall, from my point of view. There's detail.
Dr. Dittberner: Maybe I'll take a stab at it because I've had some of the same sorts of questions. There isn't anything we can give you on what that number is, simply because it does change, almost on a daily basis. I depends.
Firstly, when you talk about full-time equivalents, we try to allocate dollars on a salary basis exactly because of the event you refer to. Seasonal employment people are coming and going and you can use three seasonal people in one year who would consume a salary equivalent to one person.
The numbers vary very significantly in any year. As to how many people are on the payroll at any time, we don't have an accurate way of compiling that on a regular basis.
Maybe some of the experts here can give you a bit better detail, but it really hasn't been possible, and I don't think that anywhere in the government there is a means of being able to tell what a head count is on any particular day.
Mr. Caron: Let's take a look at page 169, à la page 181. Starting on page 169, figure 71 gives you details of control capital projects.
The information you have there is on general cashflow and a brief description of the projects Agriculture and Agri-Food will undertake that are over $3 million. The reason I say $3 million is that's what the minister's authority is.
.1555
On the next page, under ``Estimates 1995-96'', you'll find the number $65,762,000. You can compare that to the table on page 166, à la page 178.
On page 171, à la page 183, figure 72 gives you details of grants and contributions by activity. These numbers are quite self-explanatory. I don't think I need to go through them today.
On page 176, à la page 187, the total estimates for 1995-96 are $983,421,000. That particular number relates to two items under ``Transfer Payments'' on page 166, à la page 178. All statutory items are flagged with an ``S'' in this particular case.
Revenue is listed on page 177, à la page 188. In this particular case, we're giving you a breakdown of all the revenue by types. By that I mean, for example, proceeds from sales. Agriculture and agri-food do sell product, and we have listed on this particular page anticipated revenue for plants and plant products, animals and animal products, and so on.
Again, when you get to the bottom of that particular figure on the next page, the total estimate for 1995-96 of $278,177,000 relates to an item on page 19, à la page 22.
So everywhere throughout this book, you'll be able to relate those numbers back to appropriations.
On page 179, à la page 190, figure 74 will give you an idea of the GST we anticipate collecting,
[Translation]
that is the tax on goods and services that we anticipate collecting for Revenue Canada.
[English]
One of the interesting figures we have is on page 180, à la page 191. We do receive questions as to how much it costs to run the program. So we've included this particular figure, which is an estimated net cost of the agri-food program for 1995-96.
The number $1,825,655,000 in that first column relates to two things: the total appropriation - that $1.7 billion - plus the revenue-spending authority the program has. So it's appropriations plus revenue. What I mean by that is revolving funds and the vote netting authorities.
When it comes to figuring out what the net cost is, on top of that we have to add the costs that we do not appropriate in Agriculture and Agri-Food. For example, there is over $50.8 million worth of services received without charge, such as legal services, the employees' share of worker's compensation and so on.
.1600
Once you get down to what we're calling ``total gross program costs'' of $1.876 billion, those expenditures will bring in revenue, so we have deducted from that number the revenue we anticipate bringing in. So the total estimated net cost of the agri-food program is down to $1.5 billion. That particular number does not include the $172.5 million.
The following two pages, 181 and 182, 192 et 193, give you a statement of operations for the Canadian Pari-Mutuel Agency Revolving Fund.
In part B, which starts on page 183, probablement à la page 194, we give you a brief description of the other areas where the minister has responsibility. As you flip these pages over, you'll notice the minister has responsibility for the Agricultural Products Board, the FCC and so on.
As I mentioned in our previous meeting, on page 188 we also have a little breakdown of the statutes that are administered by the portfolio.
That concludes my walk-through. You notice it's quite difficult, but once you get the hang of it, I think you can walk through it quite easily. If you have any questions, we'll certainly try to answer them for you today.
The Acting Chairman (Mr. Easter): I think there are some questions.
I might point out that the purpose of today's session is mainly to get into the process and the procedure of how the figures are put together. We'll have the minister here tomorrow morning to get into the government aspect. This is mainly the detail and the figures.
[Translation]
Mr. Chrétien (Frontenac): I only have a few brief questions, Mr. Chairman. I hope the answer will be brief as well since the committee will likely have lots of questions. I refer you to page 167 in English: ``Personnel Requirements''.
Something puzzles me. Yesterday, at the meeting with the Canadian Federation of Agriculture, I jumped when its President, Jack Wilkinson, mentioned the fact, and I checked with him over the phone just a few minutes ago, that in 1995-96, 47% of Agriculture and Agrifood's budget would go to salaries and operating expenses.
You said it was 31.1%. I'm reassured, because I was quite surprised to hear the figure 47%. I am sure you remember, Mr. Easter, because you were there when I asked Jack Wilkinson. I feel better. I take what the witnesses tell us at face value and I take what you tell us at face value. However, if it's 31.1%, you're right and the Federation is wrong.
Mr. Caron: I don't know about the figures you mentioned, but I can tell you that the information contained in Part III is correct. If the percentage stated there is 31.1%, that's the right percentage.
.1605
Mr. Chrétien: I feel much better.
I have another question, Mr. Chairman. I refer you to page 177 as a starting point. Last week, at second reading in the House, we debated the bill raising the loans guaranteed by the federal government from $1.5 billion to $3 billion. It was called an Act to amend the Farm Improvement and Marketing Cooperatives Loans Act. The Farm Credit Corporation's budget is $196.051 million.
I am looking for the act because I want to know how much it costs. I don't know if you have it. It's the Act to amend the Farm Improvement and Marketing Cooperatives Loans Act.
Mr. Caron: I am not familiar with it. Maybe one of my colleagues could answer your question.
Mr. Chrétien: It would seem to me there is duplication here. If everything could be centred somewhere, the department could save a lot of...
Mr. Caron: Maybe the minister will be in a better position to answer your question tomorrow.
Mr. Chrétien: Is it in the revenue or the expenditures?
Mr. Caron: No.
[English]
Dr. Dittberner: We'll try to take your point as you've presented it here and bring you a specific answer tomorrow. The things you've discussed here have been put forward as a separate submission. There is a reference in the book, but we'll give you something a little more specific tomorrow. I can't give you the detail on it because we're not into the program side of it.
[Translation]
Mr. Chrétien: What are we supposed to do this afternoon? Can we not ask the deputy-minister and the officials of the department about Part III?
[English]
The Acting Chairman (Mr. Easter): Yes, we do, but these people are dealing mainly with process and how the document's put together. There will be other personnel within the department to deal with some of the more specific questions that need to be applied. The minister, the deputy and others will be here tomorrow. For a more detailed answer to your question, they can take notice and give us that answer tomorrow.
Part of the purpose for this session, Mr. Chrétien, is that the way the estimates are put together has changed substantially. They're more detailed. The committee wanted an explanation of how they were put together and how they fit overall.
[Translation]
Mr. Chrétien: Will these officials be there tomorrow morning with the minister?
[English]
Dr. Dittberner: I will be present tomorrow. The minister will be here with all the other program assistant deputy ministers. So the head of each program will be available tomorrow for you to question on those things specifically.
The Acting Chairman (Mr. Easter): I might say, Mr. Chrétien, that I don't believe the committee has completely decided how it will handle estimates this year. Last year we pulled each assistant deputy minister and his section in for a full committee meeting. We haven't decided whether we'd go with that this year or not.
A voice: Yes, we have.
The Acting Chairman (Mr. Easter): We have decided? Oh, okay.
Tomorrow all department heads and the minister will be here.
Dr. Dittberner: That's correct. In addition, there is a schedule for the respective program heads to come in individually over the next few weeks so you'll be able to talk about each of the programs. The one you're referring to now, FIMCLA, is the program administered by Frank Claydon. I think he'll be able to give you some of the answers tomorrow.
.1610
Mr. Reed (Halton - Peel): I'm curious about numbers that appear to change dramatically. I'm looking at figure 73 on page 177. I suspect it's probably a change in emphasis, but if we look under ``Services and Service Fees'', the actual revenue for inspection services in 1993-94 was $5,643,000, and in terms of estimates it increases tenfold. Then for testing services it's at $103,000, and the revenue increases tenfold in estimates. Is that because of a change in policy - a change in emphasis?
Dr. Dittberner: Yes. This is really the result of cost-recovery initiatives. This is revenue being generated. As the policies have increased either their rate of return or the cost for the service being provided, the amount of revenue has gone up significantly, as you've seen, or else the volume of service has gone up. It could be a combination of either.
But yes, in fact, most of these things are the result of a change in the agreements to cost-recover the services and the amount being charged for those services.
Mr. Hoeppner (Lisgar - Marquette): On that same issue, I notice for grain fees in 1993-94 you have $42 million, and that's disappeared. Why is that?
Mr. Stephen Silcox (Director, Planning and Resource Management Division, Department of Agriculture and Agri-Food Canada): The grain fees are included in the inspection services line now. They've been rolled in there. So the change is not as dramatic as would otherwise be suggested. The grand total under ``Actual 1993-94'' was $47 million, and it's now $57 million.
Mr. Hoeppner: So it's actually an increase from $5 million to $12 million.
Mr. Silcox: That's correct.
Mr. Hoeppner: Another question I had was on page 80. When the budget is presented, do you present a total program cost in a budget or do you go to the estimate on that cost? When the finance minister presents the budget, which figure in here do you use?
Mr. Silcox: The gross costs.
The Acting Chairman (Mr. Easter): In other words, the government gets credit for spending the farmers' own money?
Mr. Hoeppner: That's just what I was wondering.
Mr. Silcox: I think the answer is a bit more complicated than that.
Mr. Hoeppner: Actually the cutting could be a lot heavier, because you're not showing the revenues included in that.
Dr. Dittberner: The point that's been made and that is part of the decision within the government and certainly in our department is that some of the cuts made have been reduced by the fact that the fees can be increased for some of the services.
Mr. Hoeppner: They're a lot bigger, then.
Mr. Silcox: What has to be appreciated, though, is that revenue comes from clients for services rendered. What the finance minister is talking about is the direct burden on the taxpayer.
Mr. Hoeppner: I'm talking about the burden of the cuts on the farmer and on agriculture.
Mr. Silcox: I understand that.
Mr. Collins (Souris - Moose Mountain): I found it interesting when you said this was a walk-through. I would suggest, sir, that you enter the Boston Marathon, because you would lead the way by far. I'm glad we weren't in a hurry. But I do say - and I've said it before - that I commend you for using the foresight to start projecting ahead and for doing some actual figures. I'd like to follow up.
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For clarification purposes, I would like to go to three areas. On page 10 you make reference to the Canadian Grain Commission. You have a figure for operating expenditures - and I circled it - of $41,694 million. Then if we turn to page 12, for the Canadian Grain Commission, under ``Operating'', you have $44,365 million. Are we on the same wavelength here or am I missing something?
Mr. Caron: When we go to the vote structure, the Canadian Grain Commission is appropriating $41.6 million. We say ``operating expenditures'', but operating expenditures for the Canadian Grain Commission also include their capital requirements and whatever transfer payments they may have, which are very little, by the way.
Mr. Silcox: The biggest difference here is the statutory amount for employee benefits. The table on page 12 includes it, but the vote structure excludes it.
Mr. Collins: Okay.
On page 166 you use the term ``minor capital''. I like that term - ``minor'' - when we're talking about $39 million. I'm glad it wasn't major. Could you give me an explanation of what this is? Minor capital is the residual capital resource.
Mr. Silcox: I appreciate your comment about the significance in terms of dollars.
The difference between minor and controlled capital is what the money is used for. Controlled capital is used for the construction of buildings, the renovation of buildings and things of that nature. Minor capital is for things like computers. The distinction is important in terms of government policy, because a manager can make trade-offs perhaps between spending dollars on people and investing in technology in order to get the job done. There's a trade-off there.
We treat minor capital more like operating, but controlled capital is linked with major works and things of that nature. There is a distinct difference in the type of capital money you're talking about.
Mr. Collins: I have just a couple of points.
While I've been here I've found that when we get to this capital business, we allow people a certain amount of money to do a job - and I understand this is real rather than fictional - but when they do a projection about what it might cost to renovate the place, somebody comes in and says ``I think we'd better set a budget.'' So they set a budget, say of about $200,000.
Then they only spend $100,000 and the guy says ``Well, by God, we said $200,000. We have to spend another $100,000 or we're not going to feel right about it.'' So they go in and redo something else. When they set a target, they spend it.
When I see ``capital'' and ``residuals'' and ``minor'' and ``major'', I've found along the way that people get into the mentality that if they don't spend it, somebody is going to grab it from them. From your background and experience, is that imagined or real?
Mr. Silcox: I would say that's imagined, especially in this particular instance and these days, because the government does allow a 5% carry-forward provision on minor capital in operating. That is specifically put in place to get away from this idea of year-end spending or that you have to spend all your budget now. It's to encourage sensible, reasonable decision making and ordering things as you need them and paying for them accordingly.
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Mr. Collins: Who oversees this? I don't want to belabour it, but I don't want the Auditor General to come back to this committee and asking whether we're on target here, whether these are real and whether we have been following his instructions.
That's why I've always said that I think the Auditor General should be back every three months. Don't wait for a year to tell us that we've screwed up after three months. Let's say we just misdirected our goals and we're going in the wrong direction.
Let me just turn to another one, then I'm sure you'll want to respond. I don't know where you have it in here but I'd like to know about something somebody told me. In our hearings, it was suggested that it will cost us $27 million to pay out the WGTA at $1.6 billion.
I'd like to know what kind of figure you people projected. What page is it on, so I can put a little star beside it? I'm curious. If I had that kind of money, I'd have some trouble to say why I should spend $27 million to pay that out.
Dr. Dittberner: I have a few answers to give to you. Let me start with the last question. The administrative costs that have been calculated so far are still very preliminary at this point. I don't know what they are.
Mr. Kam and I will be going to Regina to look at the operations. As the comptroller, we'll be looking very carefully at how those figures are being estimated.
So there are no figures that are firm yet. We're going to be looking at those numbers very clearly.
I'll come back to your question on the minor and major capital. Perhaps one point of clarification with minor and major is that most departments have an agreement with Treasury Board stating at what point they will make a decision about what is minor and what is major. Normally it runs at about $400,000. So anything that is less than $400,000 tends to be considered as minor capital, and anything that's greater than $400,000 tends to be considered as major capital. That's the number. There are usually a few conditions set up to make the distinction.
I think you can understand that if somebody is purchasing something - We're going to refer to it as minor capital. Where does it begin when we're talking about computers? I understand that the general concept for minor capital is any object that is going to last more than one year and has a value of more than $100. Obviously, parliamentarians have asked in the past to make a distinction between minor and major capital.
Mr. Collins: When you go to Regina, surely you must have some kind of ballpark figure. Would you share with us what kind of a figure you think it might be?
Dr. Dittberner: I can give you a ballpark figure, but I'm not sure if it will be of much help.
This is a fairly large program. The amount and the cost that will be put aside for it, in my estimation, could be anywhere from $10 million to about $25 million. But even when I say $10 million, there may be reasons why it could be lower. At this point, it's very difficult for me to give you that. There's quite a big range.
Mrs. Cowling (Dauphin - Swan River): I want to talk about the grants on page 171. In Manitoba right now we're looking at flood conditions. I'm not sure how assistance to Canadian farmers and producers - For instance, we had $1.79 million in 1993-94. Is that ad hoc assistance?
Mr. Silcox: That particular item referred to the farm assistance and support measures program, or FSAM program, which dealt with the grain war issue.
Dr. Dittberner: In a sense you're right. The FSAM program was ad hoc at that time.
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Mrs. Cowling: Go down to grants to producers affected by the potato virus. Were they ad hoc as well? Would they fit in that category?
Mr. Silcox: Yes, I guess you would call them ad hoc. They weren't part of an ongoing program. Ad hoc means one time or short term.
Mrs. Cowling: Where do those dollars come from? They appear here. I look at the kind of flood conditions that are happening in parts of Manitoba and Saskatchewan. They may need ad hoc assistance. Where do you pull those dollars from, and how do they appear? I don't know if you can answer that.
Mr. Silcox: In the past, we had policy reserves. I think it was explained at the last session that under the new expenditure management system those policy reserves are eliminated.
I can't tell you specifically where that money came from. It might have been money reallocated from within the department. It has always been the case that the department has been required to reallocate money whenever it can. But in those days we had policy reserves and that figured very much into these programs in those times.
The very large programs we had in the past, such as the billion-dollar programs for example, were commitments by the government overall. It's not something even within policy reserves; it would have to be discussed and allocated by cabinet.
Dr. Dittberner: I have one point of clarification. When you're talking about the flooding, I think the main issue is the compensation that producers would get, which would be mainly through things like crop insurance. That would be the expectation. There's a specific program with funding to pay for crop insurance.
Mrs. Cowling: Look under grants to Canadian farm women's organizations. I see they have been cut by more than half. Can you tell me specifically which of those grants were cut? For instance, I believe we have the farm women's advancement program as well as the Farm Women's Bureau.
Dr. Dittberner: I can't give you the answer to that. Again, the program side will probably be able to answer that question tomorrow if you wanted it. But we could ask for it, and I could get the information relayed back to you. I'm not sure whether anybody else would have that.
Mr. Silcox: Michelle Comeau is responsible for the FIMCLA program, and Mr. Clayton is responsible for the farm women's programs.
Mr. Calder (Wellington - Grey - Dufferin - Simcoe): I'm not even sure where to look for it in the book here, but I'm just curious about something. Take your facilities out there, the different buildings and whatnot. Are they rented through Public Works, does the Department of Agriculture own them? How is that set up?
Dr. Dittberner: It is set up in a number of different ways. In some cases, the buildings are owned by the department, while others are under the management of Public Works. Generally, those for special purpose, such as laboratories and research stations, tend to be owned by the department. But, for example, the major headquarters building on the Central Experimental Farm, the Sir John Carling building is owned and maintained by Public Works.
Mr. Calder: Does the department rent that building then?
Dr. Dittberner: I wouldn't like to call it renting.
Mr. Silcox: That would be one of those cases in which services are provided without charge. Public Works pays for space, as one of the roles of government, and we occupy the building.
Dr. Dittberner: On page 180, you will see the amount we are getting as a benefit from Public Works. The figure of almost $18 million represents the value of property we are getting from Public Works without charge.
Mr. Calder: I wonder whether there is a situation in which, as you go through your department, you have a government facility you are renting but you decide you can find another place where the rent is cheaper. Would you move there?
Dr. Dittberner: We have done that, and we continue to do that. We are also looking at opportunities in which we can consolidate a number of our operations into one facility. Usually, if we can do that, we can get a better rate simply because there's more space.
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The best example I can give you is the food production and inspection branch right here in Ottawa. It was recently moved to be housed in one facility, which resulted in some significant savings.
Exactly that kind of process you identified is very much what we're working on right now in reducing costs, either for where we're renting or for where we're paying out costs for accommodation.
Mr. Calder: This leads me to my question. I find now that the government owns an indirect capital asset out there that is sitting idle. What happens to that?
Dr. Dittberner: Say the government has a property it owns and it has declared that it will no longer use that facility. Rather than sitting idle, that property is declared surplus and disposed of. Whether that's land or a building, that's what happens.
Those funds are either returned to the Receiver General for general funds or else it's brought back into the department if we can demonstrate whatever agreement we've negotiated with the Treasury Board in how those funds can be re-utilized. But they are returned back to the Receiver General's funds.
The Acting Chairman (Mr. Easter): Look at pages 19 and 20. I followed through the procedure on page 19, which is understandable to me, but I don't follow it on page 20. Can you explain that to me?
Mr. Silcox: What page 20 is attempting to do is explain the differences that were identified on page 19. If you noticed, at the bottom of page 19, there are two comparisons. One comparison is between the estimates for 1995-96 and the forecast figure for 1994-95. The difference is $250,731.
If you turn the page, you can see that same figure at the bottom of the page. This is what makes up the differences between the main estimates that are before the House now and the forecast figure for 1994-95, when this book was put together.
All the pluses and minuses are identified there. A similar presentation is there for the difference between the 1994-95 forecast and the actual figure for 1993-94. It's to allow the reader to appreciate what is happening over time.
The Acting Chairman (Mr. Easter): Thank you. As I said earlier, I compliment you on the detail. I don't think you'd be criticized on that. It's not your problem. Actually, as politicians, it's our problem.
I do have an overriding concern. I mentioned it the other day, but I do want to put it on the record. We were really elected to develop and certainly administer policy. But I think there's a real danger in terms of this new management system of becoming bogged down in the detail. As politicians, we're looking at whether this dollar should go here or there. As a result, we lose focus of the big picture in terms of what's happening in a policy format.
I just express that because it is, on my part, a valid concern. I've seen it happen in organizations in the past. You get tied into a ``watch the doughnut and not the hole'' kind of situation. I just want to put that on the record.
[Translation]
Mr. Chrétien: I have four questions, Mr. Chairman. The first one deals with page 16 in the English version.
I am quite surprised to find here under «Voted», on the fourth line, «Agricultural Products Board purchase and resale of mink pelts». Does the department purchase and resell mink pelts? If so, why not do the same for the pelts of foxes or other fur bearing animals?
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Mr. Caron: I cannot give a direct answer to your question. Why minks and not foxes? This program was developed by the department to help mink farm operators. Later this month, you will hear people from this program and it might be a good time to ask your question.
Mr. Chrétien: Let us go back to page 132. I have found part of what I was looking for earlier. It deals with the Farm Improvement and Marketing Cooperatives Loans Act.
What I do not understand is that the number of loans increased by about 75% between 1992-93 and 1993-94. Is there a rational explanation for this increase? Is it because the banks have no confidence in our producers? Were the banks asking that the government guarantee the loans?
Mr. Caron: I am sure that there are good answers to these questions, Mr. Chrétien, but as we said earlier, the purpose of the meeting was to go over the document. I am not familiar with all the figures given, but I am sure that the assistant deputy minister responsible for the program can answer your questions.
Dr. Dittberner: It is Mrs. Comeau. I shall ask her to give you the answer tomorrow.
Mr. Chrétien: Could we now go to pages 174 and 175. On page 174, we see contributions for the Trade Opportunities Strategy. What I find surprising, and you will probably not be able to reply to this question either, is that nearly all the items in the 1995-96 estimates have gone down when compared to the 1994-95 estimates, except for one item where we have an increase of nearly 300%. What is going on? You still cannot give me the answer?
Mr. Caron: If we may, we shall ask the question to the person -
Mr. Chrétien: And who is that? Is it still Mrs. Comeau?
Mr. Caron: Yes, it is Mrs. Comeau.
[English]
I'm sorry that there are some questions we can't really answer because we're not prepared other than manoeuvring through the book, but the program managers definitely will be able to give you those answers.
The Acting Chairman (Mr. Easter): We understand that.
[Translation]
Mr. Chrétien: I have two more questions and I will be through, Mr. Chairman.
On page 175, on the last line, we find contributions for agricultural initiatives under the Green Plan. I was very surprised to learn from the media a couple of weeks ago that the Green Plan had been abandoned. Here, we see nearly $10 million under the Green Plan, but this plan would still be abandoned?
Mr. Caron: The Green Plan was a program applying over several years. This year is the last year of the Green Plan. Some parts of it might be maintained, but I am not aware of any for now. I know that this year is the last one that the Green Plan will be in existence.
Dr. Dittberner: The program could go on next year if there was some money available, but it is nearly over.
Mr. Chrétien: We can probably talk about that tomorrow?
Mr. Caron: Yes.
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Mr. Chrétien: One last question, Mr. Chairman, if I may.
We find in the middle of the page: ``Contributions to bona fide farmers and ranchers, groups of farmers and small communities in Manitoba, Saskatchewan, Alberta and the Peace River District of British Columbia for the development of dependable water supplies''. Am I to understand that the department spends $5.5 million to drill artesian wells for the communities and farmers of these regions?
Mr. Caron: This is one of the mini-programs under this program.
Mr. Chrétien: I am surprised. Thank you, Mr. Chairman.
[English]
Mr. Pickard (Essex - Kent): Gentlemen, it must be fun to come here, listen to questions and answers and give knowledge to everyone here.
I'm really seeking some information. I see that in your set-up you've expanded from a one-year projection to a multi-year projection. In looking at that, I'm seeking some information and your knowledge about how I can find that information in the estimates.
Take the Harrow Research Centre for an example. You have basically set out your plans for this year and where you're going with the centre of excellence and the ideas there. You've projected for the next year, the year after, and so on. We have these down the line. Several plans must be put in place as to manpower budgets, other items with regard to the Harrow Research Centre. How do I find that in the estimates?
Dr. Dittberner: I don't think you're going to be able to find what I call that minute level of detail in the Part IIIs because there are just so many different cost centres that, for each one of them, they become very detailed.
We can provide it, as best as it is known. They have made some plans and they have expectations for the expenditures for each of them, but you won't find that amount of detail for a specific station or a particular cost centre.
Mr. Pickard: It doesn't matter what area we're talking about. Certainly those projections have been made, whether they are supports for various programs or whatever. We can then go to the department and get from the various managers the information with regard to the various programs or institutions or whatever is available.
Second, I'm also wondering about this. As politicians, we're often concerned about input to some of the plans and how they should operate. Is there a vehicle through which ridings or individuals are affected? These are programs that we respond to when government makes certain decisions or bills come out to put positions in place.
That, obviously, is the plan. This is the foundation by which all of the legislation follows. How can we, as members of Parliament, have some effect upon input into those plans? For my part, that's an important aspect of where we, as members of Parliament, should be. Yet the member of Parliament may often be the last to know about some issues that occur. We find out when the bills come down. Is there a proactive role?
Dr. Dittberner: I think there really is a proactive role. Of course, it's not for me to set that proactive role, but let me put it this way. I think we touched briefly on it last time.
The direction of the government in general has been that it wants to provide a longer horizon to look at the expenditures for the future so parliamentarians can have a look and have some influence in how those decisions are going to be made. Are the proportions in the right amount? Are they in the right place? Are the ingredients right that are required for a particular program?
Here's what I would see as your role. It may be something you want to raise again tomorrow. I'm sure my minister is very interested in promoting and getting concepts and ideas from all of you, either individually or collectively, as to how you might be able o shape and guide him in some of the decisions for the next couple of years.
Now it is clearly outlined what the expenditure envelope is going to be like, so it's managing within that envelope.
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I think it's there to be encouraged, but I think that's going to be much more of the political decision of how much you should be involved. But I think the opportunity is there.
Mr. Pickard: You are then suggesting that the committee - I'm talking of the agriculture committee in this place as a committee of the House of Commons - should become a more proactive organization.
Would we be better to liaise with the department or work through the minister? You're suggesting to raise it again with the minister. In other words, you are giving me direction that the minister is the best person to work through.
I think that is one vehicle. I'm asking whether there other vehicles in the department through which we can work?
Dr. Dittberner: I think that's your prime vehicle, but I think there are other opportunities of information, as you are aware. You know the trend and the plan.
We do have some more documents we could give you just to give an idea of the trend of where things are going. There's an opportunity in a number of fora for you to feed back how things may be done a little differently.
Mr. Pickard: That's precisely what we would need as a committee. I think it's very important for the members sitting here, and for our staff, to know what the trend is in the department and how the department sees things three years from today.
I agree that how we get there is a political decision. It is with the bills that are presented and brought forward in Parliament.
If we're dealing with issues, then I believe this committee should have an idea of issues that we have to deal with ahead of time so we're not always running to catch up or respond to a bill that's laid out on the table, such that we're the last to deal with it.
Dr. Dittberner: I think you're absolutely right. From what I can best describe as the outlook document, Securing Our Future, it is trying to portray where the department is going for the next few years. It gives you an outline and that picture. So I think we're working toward the same end.
On the question of some of the trends, Mr. Chairman, we do have something that will give you perhaps the same information here. We have some of that in bar graphs, which will show the trend for the future of some of the expenditures. If you'd like to have a look at how these are now, then we could maybe distribute it through the clerk to the members.
This is not anything different from what you have. It's just an analysis of what's in here, but it gives perhaps a little bit of a trend. I can ask Mr. Silcox to explain some of the points in there. It does explain what is happening with grants and contributions and how that is changing. I think these are the things you are voting on. These are the things you want to see, such as where it's going.
We were talking about major and minor capital. But how is that changing from where it is to where it's going to be down the road? When you look at it in the graph, it perhaps makes it a little bit easier to understand.
Again, if you want the explanation of the changes concerning why some of these numbers are a little bit different from one year to the next, you may have to go back to the book to at least look for the 1995-96 area.
The Acting Chairman (Mr. Easter): Before you go to that, I have one other question relating to the revenue side in terms of the government being credited for spending farmers' money.
Where would the contributions of farmers and provinces to GRIP, NISA and crop insurance come in? Does it show up at all, or is this just netted out for federal contribution?
Dr. Dittberner: This is just netted out for federal contribution.
Mr. Hoeppner: Some testimony we heard here last fall said that 93% of the grain commission expenses were actually absorbed by farmers. Are these costs above that?
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Dr. Dittberner: The numbers here show the total cost for the grain commission, their total operating expenses. I think somewhere in the area of 95% are in fact recovered. As of next year, it will be shown in a different manner. These won't be expenditures against the government because they will be in a revolving fund.
Mr. Hoeppner: Are they shown in the revenue, then?
Dr. Dittberner: Yes, it is shown as revenue here.
Mr. Hoeppner: The other question was raised by Mrs. Cowling. On page 171, there's $1.79 million, or whatever it is, for the FSAM II program. That must be just a part of that program. Is it?
Dr. Dittberner: Yes.
Mr. Hoeppner: It didn't seem to match with the potato growers. I didn't want Mr. Easter to have three times the amount of money he got. Is that a total program for the potatoes, or not?
Mr. Silcox: That's the total grant in 1993-94. But the program goes back in time. It was actually a 1991-92-93 program.
Mr. Hoeppner: How did that compare to the FSAM II program?
Mr. Silcox: I'm talking about the FSAM II program. I'm sorry. The PVYn program?
Mr. Hoeppner: Yes.
Mr. Silcox: I think it was just that one year.
Mr. Hoeppner: Okay. That explains that.
Mr. Silcox: But I would have to check that.
Mr. Hoeppner: That explains it.
Mr. Collins: On page 179, figure 74 shows the estimates for 1993-94. It has to do with GST. You show $6.281 million, but it was actually $3.791 million. How could it be that far off, from estimates to actual? I find that somebody was really stargazing to get to that figure.
Mr. Silcox: As you know, we didn't have much experience back in those days as to exactly what kind of revenues - When you implement something, you don't know exactly how much it's going to bring in or cost. I can't speak to the estimate.
Mr. Collins: I was afraid it was the underground economy, and we just lost it.
Mr. Silcox: This is actually material you have seen. We're just trying to compile it in a form that perhaps makes it a little easier for you to picture all the figures and information we talked about today.
Let me just walk you through quickly, in terms of what you have before you, then I'll come back and talk about some of the individual pieces.
We start off by portraying the department in terms of activities in 1995-96. We compare that on the next page to 1997-98. On the next page we come to a quick overview of what the resources of the department are applied to.
Mr. Chrétien raised this question earlier. When you total up the salaries and wages of 26% and employee benefits of 3%, that's 29%, not 31%. The difference is that 31% is done on a gross basis before you take into account the revenues. When you take into account the revenues, it decreases to 29%. Again, you have to understand on what basis you are calculating the percentage.
The next piece is a bar chart that gives a financial overview of the department, starting with the 1993-94 actual numbers, and ending up at the 1997-98 planned figures. I do hope you can read that.
The top part is the grants and contributions. The little wedge that you see there is our major capital.
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The next section is the operating and minor capital. In the case of 1995-96, we have another portion, which is that figure we come back to time and time again of $172.5 million, which is for budget initiatives, namely, safety net reform, adaptation and rural initiatives.
The next page has more bar graphs. This is breaking down the pieces in the financial overview into specific components. The first one is operating and minor capital. You can see that the trend is distinctly downward on that component.
The next item is major capital. You will note that it peaks in 1995-96. That is simply because of the cashflows of over 50 projects. They have come together to require the most money in one year. A good portion of that money is also to be spent for the consolidations of facilities, and so on, that are required as a result of the 1995 budget.
The next page breaks down grants and contributions. There are three components for 1994-95-96.
This is an important distinction. We have statutory grants and contributions that have been provided for in previously passed legislation from Parliament. We have the voted grants and contributions.
In 1995-96, we showed again the budget initiatives of $172.5 million. We have not broken down the two future years because we don't know that yet. Those are the spending figures we are working against.
You will note that on the very last page there are some notes that try to explain what grants and contributions are about. On the previous bar charts, there are explanations of what minor and operating minor capital and consists of.
I'll go back to the first table. This is information you have seen before, but I do want to make sure that there's no confusion about one point.
The figure we have here in shading for 1995-96 is our gross planning figure. The next column nets off the revenues credited to the vote. We come up with a total of $1,935,433,000. That is not what you will see when you go to the main estimates blue book because it has again been inflated by that $172.5 million for budget initiatives.
We have to be clear that this document addresses the future plans of the department on a consistent basis. It's not for the appropriation side before the House.
The Acting Chairman (Mr. Easter): We will take that information. People can ponder it for questions with the other departmental officials when they come in.
I'd like to thank you, Dr. Dittberner, and your people, for coming.
The meeting is adjourned.