PACP Committee Report

Mr. David Christopherson
Chair
Standing Committee on Public Accounts
House of Commons
Ottawa, Ontario  K1A 0A6

Dear Mr. Christopherson:

Pursuant to House of Commons Standing Order 109, on behalf of the Government of Canada, I am pleased to respond to the Standing Committee on Public Accounts’ report on Chapter 2, G8 Legacy Infrastructure Fund, of the 2011 Spring Report of the Auditor General of Canada. This report was tabled in Parliament on March 28, 2012.

Announced in February 2009, the G8 Legacy Infrastructure Fund was created to support public infrastructure projects that would help the Parry Sound / Muskoka region host the June 2010 G8 Summit, showcase the region’s natural beauty for foreign dignitaries and media, and provide a lasting legacy. A total of $50 million was made available under the program and, in all, 32 projects received funding. As noted in the Standing Committee’s report, the Government of Canada has provided on a number of previous occasions funding for projects located in regions that hosted major international events.

The Office of the Auditor General conducted an audit of the program and the results of this audit were published in Chapter 2 of the 2011 Spring Report of the Auditor General of Canada. Concerns were expressed regarding: (1) the information presented to Parliament through Estimates in support of the Government’s request for approval of the funding, and (2) a lack of documentation with respect to the project selection process. These concerns are discussed in the Standing Committee’s report.

With regard to Parliamentary approval, the Government has accepted the Auditor General’s recommendation on the need to improve the clarity of the information provided in the Estimates process. For example, as highlighted in the Standing Committee’s report, the Treasury Board Secretariat is taking steps to ensure that, in cases where specific sub-program elements with different parameters exist within one program (as was the case with the G8 Legacy Infrastructure Fund, which was delivered through the Border Infrastructure Fund), each element is now being listed separately in the Estimates. The end result is increased transparency, and better information for Parliamentarians and Canadians.

The decision to deliver the G8 Legacy Infrastructure Fund through the existing Border Infrastructure Fund was driven by the need to implement the program quickly, as projects had to be substantially completed before the June 2010 G8 Summit. In his October 5, 2011 testimony before the Standing Committee, the Interim Auditor General (Mr. John Wiersema) indicated that, based on a review of the evidence, this was indeed done for reasons of rapid implementation. Furthermore, the $50 million made available under the G8 Legacy Infrastructure Fund consisted entirely of new and dedicated funding, and had separate terms and conditions. None of the funding that was meant for border infrastructure improvements was diverted to G8 Legacy Infrastructure Fund projects.

With regard to the project selection process, the Standing Committee on Public Accounts recommended in its March 28, 2012 report that the Government of Canada ensure that all decisions on the intake and selection processes for infrastructure funds be appropriately documented. The Government accepts this recommendation, which is consistent with our priority of ensuring accountability and transparency.

It is important to note that all 32 projects funded under the G8 Legacy Infrastructure Fund were approved by the Minister of Transport, Infrastructure and Communities (at the time, the Honourable John Baird), who was the minister responsible for the program. Also, the Auditor General confirmed that Infrastructure Canada managed the 32 projects well. In particular, the department examined these projects to ensure that they met the terms and conditions of the program, maintained records on these projects, and administered the contribution agreements in a

prudent and responsible manner. All spending under the G8 Legacy Infrastructure Fund was accounted for. In addition, while $50 million was made available under the program, $44.87 million was ultimately spent. Lastly, the projects that received funding will provide lasting benefits to the Parry Sound / Muskoka region.

I would like to thank the Committee members again for their work in examining this issue. The Committee’s recommendation will help strengthen the accountability and transparency of the Government’s infrastructure programs.

Yours sincerely,

Denis Lebel, P.C., M.P.