PACP Committee Report

The Honourable Kevin Sorenson, P.C., M.P.
Chair of the Standing Committee on Public Accounts
House of Commons
Ottawa, Ontario  K1A 0A6

Dear Mr. Chair:

On behalf of the Government of Canada, I am pleased to respond to the Third Report of the Standing Committee on Public Accounts, entitled Chapter 5, Support to the Automotive Sector, of the Fall 2014 Report of the Auditor General of Canada, previously presented in the Second Session of the 41st Parliament as the Seventeenth Report of the Committee.

I would like to acknowledge the work of the Committee in the previous Parliament in the review of this Chapter. I would also like to thank you and the Committee for your interest in the government’s support for the automotive sector in Canada. The report provides an extensive review on the extraordinary circumstances surrounding the near-collapse of Chrysler and General Motors and, consequently, the North American automotive sector in 2008–2009. This includes measures taken by the governments of Canada, Ontario, and the United States to support the automotive sector’s competitiveness over the short and medium terms. The report highlights the Office of the Auditor General’s findings that Innovation, Science and Economic Development Canada (formerly Industry Canada), Finance Canada, and Export Development Canada had managed the financial assistance to Chrysler and General Motors in a way that contributed to the viability of these companies, thereby protecting jobs in Canada in the midst of a global recession and securing a path for Canada’s automotive industry to compete in the long term. As a result, from 2011 to 2015, vehicle and vehicle parts exports were up 46 and 47 percent, respectively.

The report included a recommendation that Innovation, Science and Economic Development Canada provide the Committee with the lessons learned from its review of the management of restructuring assistance. This was also recommended by the Auditor General in his Fall 2014 report, following a review of the management of the financial assistance provided to restructure Chrysler and General Motors. At the time, the Government of Canada accepted the Auditor General’s recommendation, and that has not changed.

I am pleased to share with the Committee that the review was undertaken and that a report on lessons learned was completed in December 2015. The report includes key findings that highlight the importance of readily available industry intelligence, multidisciplinary teams working in an environment that emphasizes information sharing, and effective leadership that facilitates timely decision-making across organizational boundaries. The Committee may access this report on the Department’s website. A copy of the report is also enclosed for your convenience. With this report, the Department has addressed three of the four recommendations made by the Auditor General. As per the Department’s response to the Auditor General, the fourth recommendation—that the Department continue to monitor the Automotive Innovation Fund against its objectives—will be addressed in 2017–18 as part of the program evaluation scheduled in the departmental evaluation plan.

Once again, I thank the Committee for its continued interest in this file.

Sincerely,

The Honourable Navdeep Bains, P.C., M.P.

Enclosure