THE STANDING SENATE COMMITTEE ON NATIONAL FINANCE
EVIDENCE
OTTAWA, Friday, March 5, 2021
The Standing Senate Committee on National Finance met by videoconference this day at 10 a.m. [ET], to study the Supplementary Estimates (C) for the fiscal year ending March 31, 2021.
Senator Percy Mockler (Chair) in the chair.
[Translation]
The Chair: Honourable senators, before we begin, I would like to remind senators and witnesses to please keep your microphones muted at all times, unless recognized by name by the chair.
[English]
Should any technical challenges arise, particularly in relation to interpretation, please signal this to the chair or the clerk and we will work to resolve the issue. If you experience other technical challenges, please contact the ISD service desk with the technical assistance number provided.
The use of online platforms does not guarantee speech privacy or that eavesdropping won’t be conducted. As such, while conducting committee meetings, all participants should be aware of such limitations and restrict the possible disclosure of sensitive, private and privileged Senate information.
[Translation]
Participants should be aware that they are required to join the meeting in a private area and to be mindful of their surroundings. We will now, honourable senators, begin the official portion of our meeting.
My name is Percy Mockler, I am a senator from New Brunswick and I am the chair of the committee. I would like to introduce the members of the committee who are participating in this meeting: Senator Dagenais, Senator Deacon, from Ontario, Senator Duncan, Senator Forest, Senator Galvez, Senator Klyne, Senator Loffreda, Senator Marshall, Senator Moncion, Senator Richards and finally, Senator Smith.
[English]
I wish to welcome all of you, and viewers across Canada who may be watching on sencanada.ca.
Today we continue our study of the expenditures set out in the Supplementary Estimates (C) for the fiscal year ending March 31, 2021, which was referred to the Finance Committee on February 16, 2021, by the Senate of Canada.
For this first panel we welcome officials from two different departments. First is Wojciech (Wojo) Zielonka, Chief Financial Officer, Finance and Administration Branch, Public Services and Procurement Canada. He is accompanied by Levent Özmutlu, Director General, Procurement, Services and Technology Acquisition Management Sector, Procurement Branch, Public Services and Procurement Canada; and by Jeff Marcantonio, Director General, Pension Excellence Sector, Receiver Generand Pension Branch, Public Services and Procurement Canada.
Next is Martin Krumins, Vice-President and Chief Financial Officer, Public Health Agency of Canada. He is accompanied by Kaili Levesque, Vice-President, COVID-19 Vaccine Roll Out Taskforce, Public Health Agency of Canada; Brigitte Diogo, Vice-President, Health Security Infrastructure Branch, Public Health Agency of Canada; Cindy Evans, Acting Vice-President, Emergency Management, Public Health Agency of Canada; Dr. Roman Szumski, Senior Vice-President, COVID-19 Vaccine and Therapeutics Acquisitions, Public Health Agency of Canada; and Kimberly Elmslie, Senior Vice-President, Immunization Program, Public Health Agency of Canada.
Welcome to all and thank you for accepting our invitation to be part of the process. As chair, I recognize Mr. Krumins to make a statement and give us some comments.
Martin Krumins, Vice-President and Chief Financial Officer, Public Health Agency of Canada: Honourable senators, I thank you on behalf of my colleagues here today for the opportunity to present to you the Public Health Agency of Canada’s Supplementary Estimates (C) for the fiscal year 2020-21.
We are pleased to have the opportunity to discuss the agency’s resourcing plans with you. The agency is currently undergoing an unprecedented mobilization of its resources in support of the government’s response to the public health impact on Canadians of the COVID-19 pandemic. With these supplementary estimates, the agency continues to address the emergency response to the pandemic including medical research, vaccine development and procurement, and purchases of personal protective gear and medical equipment.
The agency’s Supplementary Estimates (C) being discussed today capture budgetary changes since the Supplementary Estimates (B), for which we appeared at this very committee in November 2020.
Tabled on February 16, the Supplementary Estimates (C) increases the agency’s voted spending authorities by nearly $5.64 billion and decreases the statutory spending forecast by $5.57 billion for a net total increase in authorities of $66.5 million.
The Supplementary Estimates (C) are seeking $5.3 billion in operating, $57 million in capital and $253 million in grants and contributions. With the approved Main Estimates and the Supplementary Estimates (A) and (B), this will bring total authorities for the agency to $21 billion for the 2020-21 fiscal year.
If you allow me, I will take a few minutes to highlight key items of the three main components of these Supplementary Estimates (C).
First, the very large majority of this increase to voted authorities is mainly due to the transfer of residual statutory spending authorities in response to the COVID-19 pandemic. All residual funding in this statutory authority as of December 31, 2020, the date on which the act was repealed, is hereby being transferred to voted authorities.
This transfer represents $5.56 billion and is distributed among nine of the agency’s COVID-19 initiatives. The most notable transfers consist of the following: $2.48 billion for medical research, vaccine development and procurement of vaccines and therapeutics; $1.72 billion to acquire protective gear and medical equipment supplies to meet the urgent needs of federal partners, provinces and territories; $522 million for Safe Restart Agreement for federal investments in testing, contact tracing and data management; and $225 million for border and travel measures and isolation sites.
This funding was already provided to the agency as part of either Supplementary Estimates (A) or (B) of this current fiscal year. It is still needed to fund bulk purchases of PPE, testing supplies and vaccines to meet the urgent needs of the agency’s COVID-19 emergency response partners, including territories, provinces and local organizations. This funding will continue to support large-scale efforts to address the public health challenges related to the COVID-19 pandemic.
Next, these supplementary estimates also include $743 million of new funding related to several COVID-19 initiatives that supplement the existing agency response, for example, $485 million for the procurement of test supplies and testing production.
This funding will provide testing support to provinces and territories through the provision of test kits and supplies to supplement existing testing capacity. This also includes innovative technology investments to assess if and how the virus is circulating within Canada and to evaluate the impact of various interventions, $208 million to stabilize key resources and operations within the agency to maintain a sustained response to the COVID-19 pandemic and $50 million to support the surge in demand for distress centres during and following the COVID-19 pandemic. This will include the development of tailored supports to vulnerable populations, including seniors, people with disabilities and front-line workers, to be used by distress centres across the country.
Finally, these supplementary estimates include a funding transfer to the Department of Foreign Affairs, Trade and Development of $750 million. This funding is intended to support access by developing countries to COVID-19 vaccines, therapeutics and diagnostics.
As the COVID-19 situation has evolved over the last year, the agency will continue to strategically utilize its resources, financial or otherwise, to focus on ensuring appropriate measures remain in place to contain the virus, minimizing community transmission. It will work to ensure our institutions and health systems have the capacity to continue to respond effectively for the well-being of all Canadians.
Before I conclude my remarks, I would like to thank the dedicated employees and staff of the agency who have worked tirelessly for so many months to help their fellow Canadians in these very difficult times.
Finally, my colleagues and I thank you for the opportunity to speak about the work of our agency. We are pleased to answer questions from members of the Senate committee. Thank you.
The Chair: The chair will recognize from Public Services and Procurement Canada, Mr. Zielonka. The floor is yours.
Wojciech (Wojo) Zielonka, Chief Financial Officer, Finance and Administration Branch, Public Services and Procurement Canada: I thank you for this opportunity.
Today I will discuss Public Services and Procurement Canada’s Supplementary Estimates (C) for 2020-21, primarily in support of Canada’s ongoing response to COVID-19.
[Translation]
Mr. Chair, the nature of the pandemic has changed greatly over the past year. Although vaccination efforts are well underway across the country, procurement activities over and above our usual work will need to continue for the foreseeable future.
[English]
To that end, PSPC is requesting funding for specific initiatives that will help bring Canada through to the other side of the pandemic.
First, the department is asking to convert $380 million in unused statutory funding in the Supplementary Estimates (C) into voted appropriation. This funding was granted under the Public Health Events of National Concern Payments Act that the authorities expired on December 31, 2020.
Having access to this funding will allow the department to continue procuring critical goods and services such as personal protective equipment and medical supplies for front-line health care workers on behalf of the Public Health Agency of Canada. To date, we have procured some 2.5 billion pieces of equipment to help fight COVID-19.
In addition, the funding will help maintain the Essential Services Contingency Reserve. This reserve acts as an emergency backstop and gives temporary urgent access to personal protective equipment as well as other supplies on a cost recovery basis.
We are also seeking $8.2 million to help PSPC increase staffing capacity in support of other critical procurements so that staff who are reassigned to support the COVID-19 effort can continue their essential work.
We are also requesting $1.1 million as a transfer to the National Research Council for grants to develop a digital clearing house for expertise and materials to respond to COVID-19. The grants will go to companies that can develop a proof-of-concept platform for sharing and exchanging among Canadian industry and global communities of researchers, health providers and funders.
Even as this pandemic remains our greatest priority, it must be noted that PSPC employees are also involved in many other critical activities to help maintain the functioning of our government. To ensure this work continues, we are asking for $6.1 million in the Supplementary Estimates (C) for additional resources to ensure the integrity of data in the federal pension system.
This will allow us to correct errors that were transmitted by the Phoenix pay system so that we can ensure that pension payments are accurate and that our service delivery standards are maintained for the public service pension plan.
Also related to our pension system, PSPC is requesting $9.2 million for accommodation costs for employees to administer pensions to the public service, the Canadian Armed Forces and the Royal Canadian Mounted Police. This money is part of the expenditures of the pension funds which by legislation must be tracked and managed separately from the fund.
In addition, PSPC is requesting a transfer of $1.6 million to Shared Services Canada as part of the government’s initiative to consolidate information technology services and decommission data centres. As part of our agreement with SSC, our department has been transferred funds equivalent to the amount our real property services has been saving in accommodation and electricity as major data centres have been closed. This initiative will ultimately save considerable costs in providing data, email and telecom services for government operations.
As the government continues to deal with the COVID-19 pandemic, the funding PSPC is requesting today will allow us to keep supporting the government’s objective of keeping Canadians safe and healthy as well as maintaining vital day-to-day operations. Thank you, and I will be pleased to take your questions.
The Chair: Thank you both for your presentations. Before we move on to questions by the senators, I would like to recognize that Senator Pate has joined the committee.
Honourable senators, for this panel you will have a maximum of seven minutes each. Therefore, please ask your questions directly. To the witnesses, please respond concisely. The clerk will make a hand signal to show that the time is over.
Senator Marshall: My first questions are for Mr. Krumins from the Public Health Agency just to get the numbers, and then maybe somebody else can help me with my additional questions.
Taking a look at the numbers in the Supplementary Estimates (B), there was a request for $9.2 billion for medical research and vaccine development. The witness at the time from the agency told us that $8 billion of the $9.2 billion was for vaccines. Now in the Supplementary Estimates (C) there is a request for $3.8 billion for medical research and vaccine development. In total that is about $13 billion for medical research and vaccine development. Your total budget is set at $21 billion, and well over 50% of that is for medical research and vaccine development.
How many doses is the $13 billion paying for?
Mr. Krumins: I will answer the first question regarding funding, and then I will turn to my colleague Ms. Kaili Levesque to answer the dosing question.
The amount of funding available for the agency remains at $9.2 billion overall. I can walk you through a bit of math. The initial funding —
Senator Marshall: Just be brief because I have several questions.
Mr. Krumins: Absolutely. The $9.2 billion isn’t an increase in total spending. What we are doing in these estimates is transferring money from the statutory portion, which you saw previously and which was part of the $9.2 billion, into voted. It is not a new source of funds; it is just a reclassification. That maintains the $8 billion as previously disclosed.
Senator Marshall: How many doses are we buying out of the funding that is provided for medical research and vaccine development?
Mr. Krumins: I will turn to my colleague Kaili Levesque who may have that information on hand.
Kaili Levesque, Vice-President, COVID-19 Vaccine Roll Out Taskforce, Public Health Agency of Canada: I am looking for my final total in the procurements. We have purchased from a variety of platforms as we have spoken about with a total of just over 282 million doses available to Canadians.
Senator Marshall: Is that for the $13 billion we talked about?
Ms. Levesque: That is not the only amount covered in that funding, correct.
Senator Marshall: That is my next question. What else is in there?
Ms. Levesque: I will turn back to my colleague, the CFO, on that front.
Mr. Krumins: The number we are seeking here is not in addition to the $9.2 billion. The $9.2 billion is the total amount as was disclosed previously.
The $9.2 billion includes $8 billion for advance purchase agreements, $1 billion to pursue strategic international partnerships, as well as $200 million for safe and effective treatments for COVID for Canadians.
Senator Marshall: That is a significant amount of money. Have there been any internal audits or reviews? I know the Auditor General is to audit the COVID-19 expenditures, but would your own agency have conducted any internal reviews?
Mr. Krumins: I will turn to Ms. Levesque for that question.
Ms. Levesque: Is that on each of the individual procurements?
Senator Marshall: Yes, or even as a group.
Ms. Levesque: Absolutely. We worked very closely with the vaccine task force that made recommendations on the overall portfolio itself, and on which vaccines were deemed most effective, had a high potential for the Canadian population and were most likely to make it through all phases of clinical trials.
Based on that advice the Public Health Agency of Canada worked collaboratively with other departments to enter into those agreements, working side by side with Public Services and Procurement Canada.
Senator Marshall: Would those reports, assessments or reviews be on your websites?
Ms. Levesque: Not at this time as they are all subject to commercial confidentiality. I would note that the clinical trial data for the Moderna vaccine was published on the Health Canada website this week, but the individual submissions that were made by companies to the vaccine task force or others are covered by commercial confidentiality.
Senator Marshall: Is there somebody here who can talk about the vaccine rollout?
I heard Major-General Fortin testify at the House of Commons Health Committee last week when he was talking about the rollout. Is there somebody here who can talk about the rollout?
I understand there is a monitoring of the vaccines and the rollouts in the various provinces, and there is information available with regard to how Canada is doing in relation to other countries, but is there a ranking for provinces like what is available for countries? Is there something on one of your websites?
The Chair: Mr. Krumins, do you have someone to answer or can you answer that?
Mr. Krumins: Questions regarding the vaccine rollout will be addressed by Kaili Levesque.
Ms. Levesque: We publish data on our website about the rollout itself, both doses delivered and doses administered in each jurisdiction.
As you know it is a provincial-territorial responsibility to administer the vaccines, but we track those on our website and we watch them carefully. We don’t do a ranking across the board. It is reported by jurisdiction.
Senator Marshall: Is it disclosed so that I can tell which jurisdiction is slow and which jurisdiction is leading the pack?
Ms. Levesque: There are myriad factors underpinning each jurisdiction’s vaccine rollout, but that information is publicly available, senator. We can make sure to provide the website in writing to the chair of the committee afterwards or to the Senate.
Senator Marshall: In the Department of Public Works and Government Services, when I am looking at the amount of money that has been spent on supplies for the health system, can you tell us if everything in the stockpile has been allocated out to the departments or if there is anything left in case we have another pandemic or major event?
Mr. Zielonka: I think you are referring to our emergency stockpile. Right now we have inventory in there. That is something we are carefully monitoring and maintaining to ensure that we have supplies available as needed.
Senator Marshall: How much is in the inventory?
Mr. Zielonka: That changes all the time because we have a number of parties that draw down from that. We would have to get you a figure, but I believe $153 million of contracts have been put in place to date in terms of inventory for the Essential Services Contingency Reserve.
Senator Marshall: How much?
Mr. Zielonka: It is $153 million worth of contracts.
Senator Marshall: That is set aside, is it?
Mr. Zielonka: That is the total amount of contracts that were put in place, and entities have accessed some of those supplies.
Those contracts have been put in place, but it depends on when the supplies arrive and when the supplies are needed. We have been managing it and looking at the inventory and what is in there at any point in time. Essentially we have been working with our colleagues at PHAC to ensure that it is properly managed.
Senator Marshall: Thank you.
[Translation]
Senator Forest: Thank you to the witnesses for being with us today, and to Senator Marshall, who just asked a very important question about emergency stocks.
My first question is for the Public Health Agency of Canada. A year ago, on March 11, two days before Quebec went into lockdown, you were with us to talk about your budgets. I asked then if you had the human resources to deal with the COVID-19 pandemic that was starting at that time. And I was told in no uncertain terms that, at that point, you had the resources.
However, in the internal report produced in September, titled “Lessons Learned from the Public Health Agency of Canada’s COVID-19 Response,” we learn instead that the agency lacked for everything. Among other things, the report talks about multiple capacity and skill gaps across the agency, and a lack of expertise and capacity in emergency response management. It was also understood at that point that public health expertise was very limited, meaning a lack of epidemiologists, psychologists, behavioural scientists, as well as physicians at senior levels.
I understand that the COVID crisis is unprecedented and that the staff in place really did the best they could with the resources they had — and for that we should be very grateful. However, I can’t help but note that there is a significant gap between the government’s perception of its readiness and the findings in this report.
Actually, I have two questions. Is there any funding in these Supplementary Estimates (C) to hire experienced staff, epidemiologists, emergency response management staff, et cetera? Can you provide a breakdown of the personnel hired since the crisis began?
[English]
Mr. Krumins: Thank you for your question, senator. I can say that these estimates have a fairly significant investment in the capacity of the agency.
You will see an investment into the surge capacity of the agency of $227 million. That is broken down into four distinct buckets.
The first is $43.8 million to support surveillance and risk assessments, data and modelling in public health guidance, knowledge and mobilization activities.
The second is funding for increased focused investments in surge capacity for testing, testing production, evaluation, support and research, development and modelling, as well as to stabilize operations. That is an investment of $89.4 million.
The third is funding of $28.4 million for activation of emergency management and response structures.
The fourth is executive capacity, communications and engagement of $65.4 million.
As you noted, before the pandemic started we had a lower basis of what we call full-time equivalents, our employee capacity. That number for the pandemic last year was approximately 2,300. With this investment, we are having a significant increase in our human resources capacity. With this and other investments, we plan to raise that to approximately 3,900 full-time equivalents to support the surge during the pandemic.
[Translation]
Senator Forest: May we expect to receive a list of personnel that will be hired to deal not only with this pandemic, but with future pandemics?
I have a second question. Do I have time, Mr. Chair?
The Chair: Absolutely.
Senator Forest: In recent days, the media has reported several problems with the implementation of the quarantine for travellers returning to the country by air. We know that several departments are involved in this operation. Logistics are very important. Can you explain the role of the Public Health Agency of Canada in this operation?
[English]
Mr. Krumins: Certainly. Thank you for your question, senator. I don’t have the information available at the moment in terms of the classification of the employees, but I do commit to returning a response to that in writing.
For the second part of your question regarding border measures, I will turn to my colleague Brigitte Diogo, who is responsible for the border program.
The Chair: Thank you, Mr. Krumins. When you provide information to the committee, please do so directly through our clerk, Ms. Fortin.
[Translation]
Brigitte Diogo, Vice-President, Health Security Infrastructure Branch, Public Health Agency of Canada: Good morning. I’d like to respond to the question about quarantine management, specifically with respect to the role of the Public Health Agency of Canada. We work closely with our partners at the border, such as the Canada Border Services Agency. It is indeed our agency that manages the quarantine sites under our direction. We have agents, either at the land border or at the airports, who assess travellers when they arrive in Canada. Our agency has identified the hotels that are part of the implementation of the new measures. We are also responsible for all the follow-up with respect to screening that takes place at the airport or land border. Basically, that is part of our role.
Senator Forest: Thank you. Do you have any insight into the additional costs this quarantine operation will generate?
Ms. Diogo: Yes. Martin will be able to answer this question. Thank you.
[English]
Mr. Krumins: For the time being, we are funding this from the envelope that we have been provided this fiscal year. For this fiscal year we received a total of $508 million. An initial funding of $278 million was available through the statutory authorities, and then $230 million was approved as voted authorities. Through these estimates we are accessing a residual amount of $225 million, and that is being used to pay for these measures for this fiscal year.
[Translation]
Senator Forest: Thank you.
[English]
Senator Klyne: Welcome to our guests.
There was reference in the Supplementary Estimates (C) to a request of $9.2 million for accommodation costs related to pension administration, so I guess this question is for Public Services and Procurement Canada.
While the request in the Supplementary Estimates (C) is $9.2 million, could you tell the committee what the total cost is related to accommodation for pension administration in 2021?
Also, what changes has PSPC observed in terms of the accommodation costs for the federal government as the result of the widespread application of the telework policy, and what is your plan for the next five years?
Finally, please comment on the impact of the COVID-19 pandemic on the commercial properties in PSPC’s real property portfolio.
Mr. Zielonka: In terms of the accommodation costs related to the pension administration and what is the overall number, we will have to come back to you with that figure. I don’t have that because the number is typically 13% of the salary envelope. That is how that is typically calculated.
In terms of your second question relating to the PSPC real property portfolio and what impacts we are seeing, I think, like everyone else, we are seeing that most departments largely have a workforce that is teleworking other than essential employees. That is something we are continuing to watch as that evolves. There have been a number of ongoing discussions in terms of what future needs will be around space.
At this time it is still fairly early on in that process as there are broader policy implications that will have to be assessed in terms of collective agreements and so on. That is something that is being looked at, I believe, but that is in the responsibilities of the Office of the Chief Human Resources Officer at Treasury Board of Canada Secretariat.
We anticipate, though, that there will likely be a shift and we will see a reduction in demand for office space. However, our ability to put that demand reduction in place will take time because we have a fairly large portfolio owned by the Government of Canada.
Many of the commercial leases we have are longer in term. That assessment is also taking place in discussion with other government agencies and other departments.
In terms of your last question around the impact on the commercial portfolio, we are still in the midst of the pandemic. It is premature to judge on what is the longer term impact.
The Chair: Mr. Zielonka, you mentioned that you would answer in writing one of the questions by Senator Klyne. Do you have a time frame to answer that question through the clerk?
Mr. Zielonka: Mr. Chair, we should be able to answer that within the next couple of weeks. As I mentioned, it is a calculation based on the salary envelope within the pension area, so we should be able to get that within two weeks.
The Chair: As we remind both departments and others that have come to the committee, we have a time frame in the Senate in that we must table our report before the end of March 31.
If you prolong the information coming for those questions, it could certainly have an impact, if not unnecessarily delay our report. We would like to have you expedite the process. Do we agree with that?
Mr. Zielonka: Mr. Chair, PSPC is in agreement with that.
The Chair: Thank you. Please continue, Senator Klyne.
Senator Klyne: I have another question also for Public Services and Procurement Canada.
In your opening remarks you mentioned that $300 million was requested for the health system in response to COVID-19. Would you elaborate on what this funding will be used for and how it will be distributed among the provinces and territories?
It also talks about supplies, but what is the medical equipment in most need? Are there any provinces or territories in greatest need, relatively speaking? What steps has Procurement Canada taken to procure such equipment and ensure a consistent and sufficient supply of medical equipment?
Also, have you adopted any new measures with regard to personal protective equipment for health care workers and personal care workers? Finally, have you adopted any new approaches to supply for personal protective equipment to long-term care facilities?
Mr. Zielonka: I will defer some of those questions to my colleagues at the Public Health Agency of Canada.
In terms of the first question around the $380 million, we are looking at that funding being moved into voted appropriations from statutory appropriations because statutory appropriations are expiring. That funding is there primarily as an emergency. We have used some of it to date for things like arranging transportation.
Early on in the pandemic, in particular, when there was a major effort to procure critical goods, we were helping to arrange a lot of transportation logistics around that. That is where some of that funding was used. We also used that funding to procure two mobile hospitals. Those are some of the examples of the things that funding was used for.
In terms of the nature of the goods, we have acted as the entity that does the procurement but really on the direction of the Public Health Agency of Canada. Perhaps I will ask my colleagues from the Public Health Agency if they could provide some more information on that.
Mr. Krumins: Thank you for the question. I would redirect it to Cindy Evans who is responsible for the national stockpile.
Cindy Evans, Acting Vice-President, Emergency Management, Public Health Agency of Canada: With respect to the personal protective equipment, there is a number of key commodities that we have purchased in bulk supply. Those are distributed in an 80-20 distribution with the provinces and territories. Some of those key commodities are things like disposable gowns, N95 respirators, nitro gloves, surgical masks, goggles and face shields.
We have been working collaboratively with our partners in the provinces and territories to talk about their distribution mechanisms as well as what are the potential needs particularly with respect to health care workers and ensuring appropriate coverage of costs of long-term care facilities.
I am not sure whether my colleague Kimberly Elmslie will have anything to add with respect to PPE for health care workers.
Senator Richards: Thank you to the guests today for being here.
All nations have their own interests. Johnson & Johnson, Moderna and Pfizer have their own interests and own duties to their citizenry, so we were a bit behind the eight ball. I think 2.5% of Canadians have been vaccinated so far.
Will measures be taken so that we are not caught like this again? I am not blaming anybody here. I am just asking a question. Will we have our own research into our own production?
We are relying on other people in other countries to get our vaccines to our own people. How do we plan to address this situation in the future?
Mr. Krumins: I believe that question could be answered with respect to domestic capacity by Dr. Roman Szumski.
Dr. Roman Szumski, Senior Vice-President, COVID-19 Vaccine and Therapeutics Acquisitions, Public Health Agency of Canada: The question of expanding and enhancing biomanufacturing capacity is something that is very live in the minds of both PHAC and our colleagues at ISED and other departments.
There have been some investments made by our colleagues in ISED in manufacturing infrastructure through a program called SIF that includes, for example, a significant investment in the range of $140 million to Medicago to expand its Canadian manufacturing capacity in Quebec.
Also, a discussion is currently taking place between Novavax and the National Research Council of Canada which also had some funding put into it to expand its manufacturing capacity. It is intended to be able to make the Novavax vaccine in Canada when that is ready.
The Chair: Are there any further questions, Senator Richards?
Senator Richards: I yield the rest of my time if there is no other person on the panel who wants to answer.
The Chair: To Public Services and Procurement Canada, do you have any comments on the question asked by Senator Richards?
Mr. Zielonka: Not really. We are mainly there as the procurement agency to facilitate. The primary client in this case is the Public Health Agency of Canada.
The Chair: Thank you.
[Translation]
Senator Moncion: I’d like to go back to a question that was asked by Senator Forest and go beyond the answers that we got. We are talking about an amount of $225,556,596 that was earmarked for measures implemented at the borders. You are managing the quarantine sites and hotels under the new measures. What is your role in terms of pricing hotel stays, quarantine periods in hotels, security of people in those hotels, and financial responsibility for complaints made by guests staying in those hotels now?
[English]
Mr. Krumins: Yes, thank you for your question. With respect to pricing of the hotels for government-approved accommodations, the Government of Canada does not have a relationship between the traveller or the hotel.
In this case the hotels are required to set their price based on what they see as reasonable and based on the requirements that we have set out under the arrangements for approval as a government-approved accommodation.
With respect to security and the process for monitoring it, my colleague Brigitte Diogo may be able to provide some comments.
Senator Moncion: Could I just add to your first answer? Even though the government doesn’t have a relationship with the hotel, it will carry the brunt of whatever problems are associated with complaints that are being brought forward. I am a bit concerned about how it is handled.
But, please, Ms. Diogo or anyone else who has something to add on this, go ahead.
Ms. Diogo: Indeed, as my colleague mentioned, there is no contractual relationship between the hotels and the government. However, we went through a selection process in terms of the criteria that hotels needed to meet to be listed on the government website.
We have also established a help line for any travellers arriving and staying at one of those hotels, and we are monitoring any issues of complaint. We have regular meetings with the hotels that have been listed. Meetings are happening at the national level or at the regional level wherein we discuss the emerging issues we are hearing from travellers. We are doing spot checks or calls with travellers to get their feedback on stays at the hotels or their experiences throughout, including when they arrive at the airport, to ensure that we are hearing directly from travellers about their experiences with the new measures.
[Translation]
Senator Moncion: What I understand, Ms. Diogo, is that you are following up with the hotels so that they are not left to manage the quarantine on their own.
Ms. Diogo: Yes, we are following up, because hotels have to comply with certain criteria, and we have to make sure that those criteria are always met so that we can decide whether to take a hotel off our list or leave it there.
Senator Moncion: Perfect. Thank you very much.
My second question is about the pension plan. We are talking about an amount of $6,054,185 allocated for the Funding for administration and data integrity of the Public Service Pension Plan. I would like you to explain what this work will consist of.
I understand from your explanation earlier that you were referring to errors arising from the Phoenix payroll system. You mentioned the various departments and agencies that were affected by the Phoenix problems. I’d like you to give us the number of cases that you have to deal with, and what you intend to include in that $6 million.
[English]
Mr. Zielonka: Thank you, senator. The $6.1 million is related to what we call the pension system data integrity. Because of the issues we have had with Phoenix, a lot of the information that is used for pension processes relates to the accuracy of the pay data. We have had to ensure the accuracy of the data going from the pay system into the pension system. In that case we received funding to continue making quality reviews and full validations of all the information so we can ensure the validity of benefit payments.
I have a colleague who may be able to add some additional information. Mr. Marcantonio, is there anything else you can add to that?
Jeff Marcantonio, Director General, Pension Excellence Sector, Receiver General and Pension Branch, Public Services and Procurement Canada: Yes, you said it well. The funding is to fund extra activities that we are undertaking within the pension program to safeguard pension payments and services. These activities were as a result of increases in data errors that we experienced with Phoenix. These are activities for which we cannot charge the pension plan. Potentially they were caused by pay, so we do seek and need additional sources of funds to cover those activities.
Senator Moncion: Are some of the services provided by a third party, or is it all done internally?
Mr. Marcantonio: It is all done internally with PSPC staff.
Senator Moncion: Some of the other departments — and I think it is DND — have outsourced this service. They seem to have had success with it. I am not sure if you are aware of that.
Mr. Marcantonio: I am not, senator.
Senator Moncion: It was a group that we met with who were doing this. They were in the Maritimes with a company that was doing that. I am pretty sure it was done for DND.
I have another question.
[Translation]
The Chair: Senator Moncion, your time is up.
Senator Moncion: Can you put me down for the next round of questions, please?
The Chair: Of course.
[English]
Mr. Marcantonio, would you make sure to follow up on the comments made and the question put by Senator Moncion as the last item about what is being done in other regions of Canada like the Maritimes or with the company from the maritime area?
Mr. Zielonka: Mr. Chair, we manage our particular government pension plan. If it is DND and a particular element that relates to DND, perhaps that question might be better directed to DND.
The Chair: Thank you.
Senator Duncan: Thank you to the witnesses who have come before us this morning. We appreciate your efforts.
Federalism, the relationship between Canada, provinces, territories and Indigenous Canadians, is complicated at the best of times, and I think we all understand that these are not the best of times.
We are trying as the Senate National Finance Committee to untangle some of the funding relationships. We have the Public Health Agency of Canada. Thank you very much for appearing before us. We have Health Canada. There is the Canada Health and Social Transfer which was discussed at great length last night in the media by the premiers. We also have Indigenous Services Canada.
Could I ask the witnesses before us today to track, just as they tracked the vaccine rollout by provinces and territories, and provide us with an answer in a timely manner, as the chair has asked, on the funding provided by your agencies to provinces, territories and Indigenous communities throughout the country? Could we have that information?
In terms of a specific question about the data management outlined in the Public Health Agency of Canada’s supplementary request, there is money for investment in testing, contact tracing and data management. Could you elaborate on that money, particularly in terms of underserved areas of the country with regard to internet or those provinces and territories that did not sign on to the Government of Canada’s COVID-19 tracing app? Could you elaborate on that funding and how well it is working throughout the country?
Mr. Krumins: I turn to Kaili Levesque to answer this question.
Ms. Levesque: Thank you for your question. The specific amount you were referencing under what are called the safe restart agreements, where $522 million was made available to provinces and territories specifically for data, is not tied to the use of the COVID alert app itself.
To be clear it is more about the collection of public health data to understand the epidemiology of this tricky virus as well as the tracking of the immunization, case counts, et cetera. It is that level of data that we are discussing.
We are also collecting data on the immunization rollout itself in addition to reports on adverse events or any of the information shared with the Public Health Agency of Canada through the provinces and territories. It is not linked to individual use at the mobile device level.
Senator Duncan: What are we doing with that data? Are we able to access it in a public manner? Are we able to be assured, for example, that vaccine rollout is taking place in Indigenous communities and throughout the country? Are we able to track that information? Could I have that response in writing, and could I just squeeze in one quick question for Ms. Diogo?
You mentioned the border support systems that are in place. Could you elaborate on the support systems at our land borders that are particularly close to the U.S.? I believe there is a situation in Senator Mockler’s region where there is a very close border situation. We have Stewart in British Columbia with its proximity to Hyder, Alaska. Yukon has very close borders with Alaska as well.
Could you elaborate on the support systems in place going forward as we hopefully move to a better state with regard to COVID-19?
Ms. Diogo: The measures we have in place fully recognize we have communities that are very integrated along the Canada-U.S. border. These very small communities are very dependent on each other for essential services and needing to cross almost on a daily basis. I think you gave the example of Stewart.
These communities are currently exempted under the new measures to have a COVID-19 molecular test prior to entering Canada. We recognize that it would be impossible for someone who is crossing every day to do a test every day. We are making sure to provide better clarity for these communities to know what applies and what doesn’t apply to them. We are as well working closely with the Canada Border Services Agency because the first contact is with the border service officer.
It is ongoing work to assure that people really understand the new measures.
Senator Duncan: Going forward, Ms. Diogo has mentioned they are making sure people are made aware in terms of contact tracing.
What about vaccine rollout? Are we able to ensure that the smaller communities are able to receive their vaccines, or are we working with the provinces in that regard?
I see my seven minutes are up. Could you perhaps outline in writing how we are working in terms of seeing if both sides of the communities and both sides of the border having access to the vaccine would facilitate the travel between the borders?
The Chair: Mr. Krumins, perhaps you could take that question under advisement and send that in writing to the attention of the clerk in a timely fashion, please.
Mr. Krumins: Yes, we can.
The Chair: Thank you.
Senator Loffreda: Thank you to the panel of witnesses for being here.
My question is for Public Services and Procurement Canada. We have all seen through this pandemic how important procurement is. PSPC is seeking $8 million to improve the government’s procurement processes.
Could you give us the details as to what improvements are necessary, what gaps currently exist and, going forward, how we could correct some of the errors we have made.
Mr. Zielonka: Maybe the way I would characterize it is not necessarily that there have been gaps or errors. What we have primarily experienced in this pandemic is a sudden and huge increase in demand for our services in an area that all of a sudden became highly competitive and, initially at the beginning of the pandemic, a bit of a wild west. That was the situation we faced as a department.
From a staffing perspective we saw significant overtime and needed to bring additional staffing on board. That is one of the elements we continue to see.
However, I also want to add that as a department we are also working on the general procurement modernization. It has been a multi-year effort that started prior to the pandemic. It is intended to move us from a largely paper-based procurement methodology to a much more modern and electronic system called the electronic procurement solution. That is in the process of being implemented. It is a multi-year project and as such is being implemented in phases. That will help us to be much more nimble in terms of our ability to interact with suppliers and being able to react much more quickly in procurement areas.
I will stop there and if there is any supplemental from the senator.
Senator Loffreda: Thank you for your response. How do you distinguish between potential and non-potential suppliers? Are most of them domestic? Would it be strictly price? Is it price, quality or reputation?
I mean we are in a digital age and you have talked about a system that will be very digital. How do you integrate reputation and price quality into all of that?
Are domestic suppliers being favoured when possible? Before Christmas I was told that the government had received more than 26,000 submissions as of May 2020, including nearly 17,000 from domestic suppliers. Nearly all domestic companies that submitted forms were contacted. That is huge, so maybe a little elaboration around that process would clarify things for me.
Mr. Zielonka: I am no expert in that area, but what I can say is that I know our procurement area works closely with respective departments to understand the particular needs and the type of product. As part of that process they establish criteria for the procurement.
Those criteria look at a balance between price. For commodities, in essence, price will be a significant factor in the evaluation versus much more complex procurements where technical knowledge and expertise are much more significant elements. In those cases the weighting would be heavier to the technical expertise to make sure we are getting exactly what we are looking for. That is something that is looked at.
They also look at the availability of vendors in various jurisdictions. In general, unless there is a national security exception in place, our trade agreements require us to have procurements open to multiple vendors. However, at the same time we have certain programs where we are trying to address historic challenges.
For example, we recently launched a pilot focused around Black-owned businesses, and we tried to increase our procurements from those. We have also been doing a lot of work around procurement from Indigenous-owned businesses. That has been another focus.
In terms of your last question around what I would call the integrity regime, over the last few years there has been a lot of work done with vetting our suppliers to understand that there are certain issues we want to avoid, especially, for example, the use of child labour and issues like that. Suppliers get vetted by our department as well, and that is an evolving effort. I will stop there.
Senator Smith: Thank you to the witnesses.
My question is for the Public Health Agency. Today we hear that Johnson & Johnson has been approved as a supplier of vaccines for the COVID pandemic. Knowing that, what is the relationship between procurement and public health now in terms of executing the actual acquisition and distribution of this particular supplier? How does it work between the two departments?
I am trying to find where each of you fit in terms of your relationship between procurement and the actual delivery. You talked about testing and all the other issues before, but could you give us an overview of how you work together? Can we say it’s a seamless operation, or do we have issues and conflicts between your two departments that would normally exist?
Mr. Zielonka: Maybe I could take a first crack and start with the latter part of your question as to whether it is seamless.
Generally the departments work very well together. The process is that usually a department will come to us with a particular requirement. We will advise them in terms of the procurement options, and we will work very closely with them to frame those up. Our expertise is in terms of accessing those particular supplies in the marketplace, but it really does come to the particular department to spell out the requirements.
On that note I will pass it over to my colleagues.
Senator Smith: Could I ask a question that could be helpful? As you look at the past experience of over a year of trying to acquire and solicit supply — and there have been well-documented bumps along the way — what have you learned between the two departments?
We seem to have some recent success, but as you go through it and make your initial evaluations, how do you rate yourselves? What have you learned that will be the big turnaround to differentiate you from this experience to the next experience?
Mr. Zielonka: That is a great question, senator. I wasn’t in the department at the time, but I think one of the challenges that happened was that the pandemic hit us almost like a tsunami. At the same time the departments were also transitioning from working physically in a work space to teleworking.
That became a huge challenge. We had massive challenges around our IT infrastructure in terms of being able to access systems. In the first few months we had to have employees logging on at different times because we didn’t have the system access. That was very challenging.
The other challenging part was that for some critical supplies all of a sudden there was a huge spike in demand. We heard stories of people showing up on the aprons of airports with suitcases of cash trying to buy supplies that were already procured by other entities.
That is a challenging environment that hopefully we won’t see repeated. There will be lessons learned from that and I think there have already been some lessons learned. Looking at it in terms of making sure that we have domestic supply would be one incident. I think our colleagues at PHAC will be able to speak to that.
Dr. Szumski: To add to what my colleague from PSPC has said, the specific role is that the Public Health Agency of Canada has the funding for the purchases and PSPC is the contracting authority. They are the experts at negotiating and managing the aspects of developing a contract and so on. The working relationship is extremely close with multiple points of contact every day. It has been a very productive relationship in terms of obtaining the seven contracts we have for vaccines.
Senator Smith: Having said that and from the lessons learned, what is the number one takeaway between public health and procurement that stands out in your mind at this particular time as a learning experience and lesson that could be carried forward to make sure we don’t get ourselves behind the eight ball like we did when we started in this pandemic?
Dr. Szumski: The lesson learned that I would put forward is that there was an additional party which was instrumental in the selection process. That was the external advisory board of the vaccine task force that provided advice on which vaccines. As of today, the first four that had been selected actually made it through to authorization by Health Canada, including the Johnson & Johnson, as we heard this morning.
Senator Smith: Thank you.
[Translation]
Senator Dagenais: My question is for Mr. Krumins. Mr. Krumins, in the supplementary estimates an amount of $1,728,000,000 is earmarked for the acquisition of personal protective equipment and medical equipment. One can’t say that the acquisitions made by the government are always necessary.
Since this spending has no historical precedent, do you have a monitoring system in place that would allow us to know if unnecessary purchases were made since the pandemic began? If so, can we find out their value? If the answer is no, do you think it is normal that we don’t have tighter controls on spending Canadians’ money?
[English]
Mr. Krumins: Thank you for your question. I will answer the first part with respect to controls and the value for money. Then, I would ask my colleague Cindy Evans to speak to the link of what is available and how it’s being used.
With respect to controls, we do have a very rigorous system of control in place in the department with respect to controls over financial reporting, controls over material management for inventory, and we use that process seriously. We report to our departmental audit committee on the status of those controls, and we make sure that we’re properly assessing the value of all products coming in and all products going out. You’ll note that at the end of this fiscal year, we will have a significant quantity of inventory that we’ll be accounting for. We use generally accepted accounting principles in good practices for controls to make sure that money is well spent and valued.
Ms. Evans: One of the important aspects of our work, as I mentioned previously, is the relationship we have with the provinces and territories. We work with them in what we would refer to as pan-Canadian supply and demand modelling to find out the pressure points, the challenges they are having with respect to their own procurement, and what in the bulk procurement the federal government is doing to make sure we are covering the landscape.
I will say that the pandemic has evolved, as has the supply situation globally. In a scarcity-of-supply situation we need to determine what is available and how we can best situate particularly the health care workers.
As to your question of whether we made unnecessary purchases, the federal government with the global scarcity of N95 masks moved forward to purchase KN95 masks. Again the objective was how best to situate health care workers in Canada to put them in the best protective equipment possible.
Our supply has changed. Our purchasing has changed. We continue to evolve. What equipment do we bring in that best situates? As an example, we looked to where we would bring in the KN95 masks. Now that we have a more highly effective N95, how can we use those supplies effectively in a different context? Where would we use a non-medical mask or where would we have a lower level of mask requirement?
In terms of the supplies we have on hand, we are looking at how we have an appropriate disposition of those and how to repurpose them for appropriate uses within the COVID-19 context.
[Translation]
Senator Dagenais: Ms. Evans, I see that there is an addition of $208 million to the Public Health Agency of Canada’s expenditures, in a line item designated as “Funding for Surge Capacity.” Can you tell us what this money will be used for, who decides how this large amount of money will be used, and where this money goes?
The Chair: Whom is your question for, specifically?
Senator Dagenais: I had put it to Ms. Evans, but Mr. Krumins can answer too.
[English]
Mr. Krumins: Thank you for your question. I’m having difficulty tracking down which line you’re referring to in our estimates. Is there a specific title you’re referring to for this reference?
[Translation]
Senator Dagenais: The line item is called “Funding for Surge Capacity.” I found the $208 million in this line item.
The Chair: On what page, Senator Dagenais?
Senator Dagenais: I didn’t notice the page number.
[English]
Mr. Krumins: From a mobilization capacity, there are investments in surge capacity. This is related to our capacity from a human resources perspective and follows the investment that I spoke to earlier in our footprint of our capacity from a percentage perspective.
Much of the funding we have received to date has been dedicated to specific purposes and time-limited funding for purchases of vaccine or purchases of protective equipment. The funding in the estimates is support for a well-structured and effective delivery of the programming. It is in reference to the support for surveillance and risk assessments, focused investments for search capacity and testing, funding for activation and emergency management, as well as a sustained capacity in our corporate policy and leadership.
[Translation]
The Chair: Senator Dagenais, are you satisfied with the answer to your question?
Senator Dagenais: Mr. Chair, do I have any time left?
The Chair: Yes, you have 45 seconds left.
Senator Dagenais: I would rather intervene during the second round of questions.
[English]
Senator Galvez: Thank you very much to our witnesses for being here this morning.
We have heard from the PBO frequently. In the February 21 supplementary estimates report he, like you, said that there had been a substantial increase in the number of authorities requested by the government in response to the global pandemic. Given this increase, it is essential that parliamentarians can perform their critical role of scrutinizing government spending and ensuring value for money.
The PBO raised and highlighted certain information gaps that I still see in the reports. They are related to tracking all the COVID-19 spending and to the information being provided to parliamentarians so that we can have a complete and updated picture of government spending.
In the last supplementary estimates and this one there has been a series of expenditures associated with vaccine development, vaccine production, vaccine acquisition, and soon we should see vaccination cost. The funding has been described under the labels of vaccines in general, R&D and biomanufacturing.
We read the report, but at the same time we read the news and we have other references. Today we know the government has invested several billions to secure access to six vaccine candidates. These include upfront payments that companies require to support vaccine development, testing and manufacturing. Subsequent payments are contingent on vaccines passing clinical trials and obtaining regulatory approval.
Moreover, in a recent article in Nature, according to the Duke Global Health Innovation Center, Canada has pre-ordered almost nine doses of COVID-19 vaccines per person. This is a very high safety factor compared with that of the U.K. which is 5.5 or of the European Union which is 4.5. Yet, Canada ranks about fortieth in the world for per capita vaccinations.
Less than 3% of Canada’s 38 million people have received the first of the two shots. This shows, on one side, a worldwide rush for vaccine acquisition and an unprecedented rise and dependence on big pharmaceutical corporations that have collected more than $15 billion from the COVID-19 pandemic so far.
My questions are the following: Could you provide us with detailed cashflow differentiating foreign vaccine acquisition, R&D and domestic production for the last year up until these supplementary estimates?
I have four other questions. I would appreciate it if you cannot complete your answer to send your answer in writing.
Mr. Krumins: Thank you for your question, senator. Yes, I can take that back to the department and follow up to provide you with the answer to your question.
Senator Galvez: My second question is concerning sums that have gone to R&D in Canada for domestic vaccine development. Are we making sure that the patents for vaccines being developed using public funds won’t be sold to big pharma and will lead to generic vaccines? Who will be responsible for doing that?
Mr. Krumins: I don’t have the expertise in this area, but I would ask Dr. Roman Szumski if he is aware of this.
Dr. Szumski: Thank you, senator. It is a great question.
The issues in policies around intellectual property and the like are better handled by our colleagues at ISED in the industry portfolio. That is not something the Public Health Agency is actively engaged in.
Senator Galvez: Will you provide me with an answer at a later time?
Dr. Szumski: The question should be with the industry portfolio.
The Chair: That will be next Monday, Senator Galvez.
Senator Galvez: I will keep my question.
On the government procurement site six vaccines are mentioned. The CanSino vaccine, the one with China, is not mentioned. Several media articles reveal a deal between Canada and China that failed but we don’t have details. Because of what I mentioned before and this news I want to highlight the necessity for increased scrutiny and demand for transparency.
I request that the contracts and deals with pharma in R&D groups are rendered public and that the vaccine dose price, delivery calendar, responsibility and sanctions, and conditions of partners are available to this committee. After all, vaccines all over the world have been developed with public money, and vaccines recipes are not national security secrets.
Mr. Zielonka: I think we have a level of disclosure on our website in terms of particulars on contracts. I am not in a position to answer.
I am not sure if either of my colleagues who are with me or if anyone from PHAC is able to provide any details or answer that. I am not able to answer that question.
The Chair: Therefore, can you take it under advisement, Mr. Zielonka, and come back to us in writing through our clerk, please?
Mr. Zielonka: We can do that.
The Chair: What is your time frame?
Mr. Zielonka: We will do it in the same time frame as the previous question, so within the next two weeks. We will take into account your timing for getting your report. We will work as quickly as we can.
Senator Galvez: I still have time for one last question and I will put my name on for the second round.
The Chair: You will have to go on the second round because there are only 21 seconds left.
Senator M. Deacon: Thank you to all for being here today; it is very interesting.
My first question is for the Public Health Agency of Canada concerning the $3 million in the sups from the Privy Council Office to the Public Health Agency of Canada, marked for public education campaigns on COVID-19 public health measures and COVID-19 vaccination.
Since the advent of these vaccines late last year we have heard that one troublesome hurdle could be vaccine hesitancy. Does your department plan to run a public relations campaign to combat the misinformation that is out there, or is this being left completely up to the provincial and municipal health units to undertake? I will start there.
Mr. Krumins: I will ask my colleague Kimberly Elmslie to answer the question regarding hesitation on vaccines.
Kimberly Elmslie, Senior Vice-President, Immunization Program, Public Health Agency of Canada: Thank you very much, senator, for the question. It is a very important one.
We are working very diligently with our colleagues in the provinces and territories on measures to increase vaccine confidence. That includes mounting a public education campaign in the near future so that the people of Canada are well informed about vaccines, their safety and effectiveness.
We will be dealing with the general population as well as very targeted kinds of programs in communities because we know that when it comes to vaccine hesitancy, community leaders, the community context and the concerns of particular communities differ across the country. Therefore, through our programs we are supporting community-based efforts. In fact, we have just completed a very large solicitation for community-based projects. Those will be reviewed in coming days with the objective of accelerating supports to those communities.
I wholeheartedly agree with your comment on the very strong and fundamental importance of addressing vaccine hesitancy, misinformation and disinformation as vaccines roll out.
Senator M. Deacon: I would like to piggyback and build on that. Your answer might be similar. Even among those wanting a vaccine who are positive and proactive in trying to help others we have seen in some countries a hesitancy, or perhaps a value or judgment, to accept the Johnson & Johnson or AstraZeneca vaccines because they might be perceived to be not as effective. The numbers and the data are out there.
Of course I would note that all vaccines are incredibly effective in preventing serious illness and death, but I also wonder if there is a communication strategy to convince or educate, as you said, Canadians that frankly any vaccine is a good vaccine and one that we should accept.
Ms. Elmslie: That is a really important question. Yes, as vaccines roll out our public education and our professional education will be very clear on the fact that all vaccines authorized for use in Canada have an important place in our vaccine strategy. Some vaccines will have different characteristics than others.
Canada’s public health system is very well equipped and has a very strong historical track record in the appropriate use of vaccines and their deployment to protect the health of Canadians.
Senator M. Deacon: My next question is in regard to vaccine procurement.
My worry is that the subject of procurement has become quite politicized, and it is becoming increasingly difficult to get a clear picture through some of the noise that we hear. Again, thank you for being here today.
My question is specifically regarding the COVAX initiative. Much has been made of the fact that we will be receiving vaccine from this program. Some have pointed to it as an example of Canada falling behind in its procurement while others have said it was always the intention to receive vaccines from the program.
Are any of you able today to describe the mechanism behind this program if in fact Canada is taking vaccines from poorer countries, or if the program was intended for investor countries like Canada to access the vaccines from them as well?
Mr. Zielonka: I think that question is probably best directed to my colleagues at the Public Health Agency of Canada. I will ask them if they can answer that question.
Mr. Krumins: We can take that question. I will direct that to Kaili Levesque for response.
Ms. Levesque: Thank you very much for your question, senator. The COVAX facility is in fact a very unique mechanism that was developed in response to the global pandemic.
As you know, it is a multilateral procurement tool but it has two tiers in its very existence. One is for what we call “self-financing countries” in which Canada and other advanced economies participate. The other is for the advance market countries. Those are low and low-middle income countries being served through humanitarian grounds that our participation helps support.
While we did invest $220 million domestically into the COVAX facility for our own procurement, as you rightly noted, we have opted for the AstraZeneca vaccine. To date we also contributed over $325 million to COVAX to help them advance the vaccines for advanced market countries and low-middle income countries.
It is a pooled procurement mechanism so that you have that strength of collective buying power. It is a bit akin to a federation model, if I can be analogous there. The idea is that countries have the option to take from within, and it does not disadvantage the advanced market countries because they are operating on those two tiers.
Senator M. Deacon: Thank you for that. That is, as you know, a very mixed message out there. To the chair, I would be happy to go on round two or three or four.
The Chair: Senators, this brings us to the end of the first round.
We will now begin our second round, starting with Senator Marshall.
Senator Marshall: My questions are for Public Services and Procurement Canada.
On the $419,000 for the anti-money laundering, I think the government committed in the last budget over $100 million to a number of departments and organizations for anti-money laundering initiatives, but I didn’t see anything there for Public Services and Procurement Canada.
What is the money for? What is your role in this initiative?
Mr. Zielonka: This money is to establish a dedicated team of forensic accountants. Essentially it is to support the overall anti-money laundering regime, the partners in it and the law enforcement agencies. It is focused around money laundering and terrorist financing in Canada.
The team will be very specialized. Their skills and abilities will be to review the complex transactions that often happen associated with these activities. They will help to identify money laundering indicators. They will also be a variety of skills to include tracing the funds through crypto-currencies, the identification of proceeds of crime and allowing the government to seize the assets in cases.
Senator Marshall: Are you new to this initiative? Is this the first funding you have received for the initiative, or have you received funding previously and I haven’t seen it?
Mr. Zielonka: We have other initiatives, but I believe this is the first funding that we are getting specifically for this initiative and in support of the broader government initiative.
Senator Marshall: In response to Senator Loffreda, you were talking about the $8 million for improvements to the procurement process, but I noticed you didn’t mention National Defence or military procurement. I am thinking in terms of the Auditor General’s report last week on the National Shipbuilding Strategy and recommendations that were directed to your department.
Will any of that funding be used to address the recommendations of the Auditor General last week?
Mr. Zielonka: No, this funding is very much geared toward emergency procurement processes related to COVID-19. This is a very specific ask and it is related to that.
Senator Marshall: Could you get back to the committee to let us know what the response to the Auditor General will be? You have agreed with her recommendations, but there is no information here as to how you will implement her recommendations.
Mr. Zielonka: I believe that response will be publicly posted once it is available, but I will follow up within our department.
Senator Marshall: Thank you.
Senator Galvez: Following on the fact that Canada has pre-ordered nine times dosage per person and that we are behind in vaccination, could you tell us what is the calendar for the reception of pre-ordered vaccines?
What will happen if the U.S. completes vaccination but Canada doesn’t? Could it be mandatory or feasible that under the new NAFTA we need to speed up vaccination and buy spare American vaccines?
Mr. Krumins: If this is specifically for procurement I would direct that to PSPC, but with respect to rollout I think my colleague Kaili Levesque could speak in terms of the go-forward plan.
Ms. Levesque: I will note on the vaccine rollout that while Canada does not have the full forward procurement pieces, as my colleague noted, to date we have administered almost as many doses as have been delivered to Canadian soil. As of today we have received just over 2.8 million doses and have administered around 2.2 million doses to date.
That speed of pace by the provinces and territories in administration is ramping up significantly. We are entering the next phase of our vaccine campaign with the real-time authorization of the Anthem vaccine today and seeing additional doses of AstraZeneca coming into the country this week.
We are working with provinces and territories in real time to advance their capacity as well, including daily touch points with them on rollout, supports needed and capacity. We have purchased freezers, cubes and ancillary supplies to support the vaccine rollout and to ensure that the folks on the ground can focus on immunizing in the most expeditious way possible.
In terms of travel in relations with Canada and the U.S., those conversations are ongoing continuously and I cannot speak to those at this time.
Senator Galvez: Important funds have been going to the development of therapeutics for the treatment of COVID. As part of the auditing and self-auditing you are to do, will you compare the difference between how much we have paid for both vaccines and therapeutics from foreign corporations and countries, compared to what it would have cost if we had done these domestically?
Mr. Krumins: My colleague Dr. Roman Szumski can respond to the issue of therapeutics and acquisitions.
Dr. Szumski: Yes, there is acquisition of therapeutics taking place to date. There are two that we have procured for the provinces and territories. One is called Regeneron and the other one is called bamlanivimab by Eli Lilly. I will underscore that the second one with Eli Lilly actually has Canadian content. The product itself was created in British Columbia.
On the question of price, do Canadian companies offer a better price point than international companies? I am not clear that is the case, but you can often see a case where they would be quite similar.
Senator Klyne: I want to follow up on the line of thinking of Senator Duncan.
In the supplementary estimates the Public Health Agency is requesting $523 million for the Safe Restart Agreement with provinces and territories for investments in testing, contact tracing and data management. In addition, if I understand correctly, there is a request for a further $485 million to study alternative or better strategies for contact tracing.
The federal government put a lot of emphasis on and resources into the exposure notification app, and now there seems to be a focus on contact tracing. I have two questions, one around the exposure notification app and then a second line on contact tracing.
With regard to the exposure notification app, could you tell this committee how many times that app has been downloaded? How many exposure alerts have been sent to users? How many users have entered a key code indicating they have tested positive for COVID and got a warning from the app? What has been invested in the exposure notification app to date?
Then I will ask about the contact tracing.
Mr. Krumins: I would like to get back to the committee in writing with that response. I believe there is a component that resides with my colleagues at Health Canada.
Senator Klyne: So that will also be referred to Health Canada.
The second one is concerning contact tracing. Could you tell this committee since your last appearance to what extent provinces and territories have improved their contact-tracing capacity? How and where will the monies being requested for testing, contact-tracing capacity and data management be used?
Also, are there any comments from Public Health regarding two different apps attempting to achieve the same goal? Are both being relied upon or is one being deemed more appropriate at this stage of the pandemic?
Mr. Krumins: We will come back to you in writing on this point. I believe we will link up with our colleagues at Health Canada as well.
Senator Klyne: Thank you.
[Translation]
Senator Moncion: I got answers to my two questions. One was asked by Senator Marshall about money laundering, and the other was about Indigenous communities.
[English]
Senator Loffreda: Thank you to our panel of witnesses once again.
Staying on the tools and treatments is extremely important. The estimates state that the agency will develop new tools to assess how the virus is circulating in Canada and to evaluate the impact of various interventions.
Could you specify what new tools are currently being developed? We all question the COVID app at this point in time for various reasons. How will we use this data? What will come out of it? What do you exactly mean by interventions? Maybe you could elaborate a little on that front.
Mr. Krumins: Certainly I can answer the first part and then I ask my colleague Kimberly Elmslie to supplement the answer.
There are investments in innovative research. Part of it is for procurement of test supplies and testing production. That has a series of different components related to it. First is production and evaluation of open-platform reagents and associated consumables to provide provinces and territorial laboratories with products for testing.
There is also federal procurement of point-of-care tests, including antigen testing. This would support remote northern communities, including Indigenous. There are also components related to federal procurement of rapid testing, including antigen testing on behalf of provinces and territories, as well as procurement of diagnostic testing supplies.
In terms of innovative technology initiatives there are three components that I would reference. First is surveillance of wastewater to assess community infection, as well as whole-genome sequencing of the virus, and modelling efforts to estimate effectiveness of interventions to predict the success or consequences of de-escalation of protection measures.
With that I will ask my colleague Kim Elmslie if she has anything to add to that.
Ms. Elmslie: I will only add because Mr. Krumins did a great job at laying out the various interventions we are investing in.
As part of our work to support our colleagues across the country in the early detection of COVID-19 infection and in appropriate follow-up, the work that we do through our national microbiology laboratory that Mr. Krumins mentioned is exceptionally important in developing consistent and standardized tools.
Highlighting the work on gene sequencing is allowing us to understand the spread of variants in the population and to follow that very closely. We are also investing in our data systems to ensure, for example from the point of view of vaccine safety, that we are following the administration of vaccines and any adverse events following immunization.
With the provinces and territories and with our colleagues at Health Canada, we are always on top of any emerging issues with regard to the use of vaccines in our population. I will stop there.
Senator Loffreda: Thank you for your responses. I have a few other questions but I will just ask a quick one.
To follow up on the important question Senator Galvez asked, $2.5 billion are allocated to funding support research, development, purchases of vaccines and treatments. We would all like to see Canada as a leader on this front.
Do we feel there are sufficient funds being requested to develop domestic treatments? We all know this COVID virus may be endemic. We all hear about the side effects, even the long-term side effects of those who have been cured. Is there anything else we can do on the treatment side and really be leaders this time and not like with the vaccines rely on foreign supplies and being where we are at this point in time? I feel we will catch up eventually with the vaccines, but we would like to be the leaders and not just be lagging on that front.
Any comments from the Public Health Agency of Canada or Procurement Canada would be welcome.
Mr. Krumins: I agree that it is an important topic to consider. I think ISED plays an important role in the space, but my colleague Dr. Roman Szumski may have views as well.
Dr. Szumski: An example of one of the therapeutics that has a lot of airplay is bamlanivimab which is a product of Canadian origin. The comment that Canada has the capacity and the know-how to make important advances in the space is legitimate.
During this pandemic we also had the advantage of the Therapeutics Task Force, similar to the Vaccine Task Force, to provide advice on what Canada ought to be doing to improve its R&D response and its access to therapeutics. They were underscoring things that could be done to improve our performance related to activities such as organizing clinical trial networks and funding them well across the country so that we could be a leading country in evaluating novel products.
I think these measures will put Canada in a good spot to be a player in the therapeutic space.
Senator Loffreda: We should always be leaders. Thank you.
Senator M. Deacon: I have two questions and a comment, so I will go as quick as I can.
First of all, coming back to the $2.4 billion for medical research and vaccine development, we heard a while ago that the government had reached terms to produce the Novavax vaccine at a facility in Montreal and is investing in facilities in Saskatoon and Vancouver.
Could you tell the committee which kinds of vaccines these facilities will be able to produce? Will they be able to produce the new mRNA vaccines like Moderna and Pfizer, or will they be the well-established bioreactor production type?
I would like to ask that question and then follow up depending on the answer.
Mr. Krumins: I believe Dr. Szumski will answer this question.
Dr. Szumski: Thank you for the question, senator. The investments you referred to were made by the ISED industry portfolio, but I can make some comments on them.
On the investments into VIDO-InterVac in Saskatoon to research vaccine development, it has significant expertise and facilities in that regard. It focuses primarily on the more traditional type of vaccines, if you want to call them that. It is not specifically the mRNA as far as I am aware. I don’t know if they have plans to change that in the future, but where they are currently is their strength.
I believe the investment in Vancouver was in the AbCellera company. There may be another one in B.C. I don’t have the details, but it is from the industry portfolio. One of those would be therapeutics.
An investment was also made in an organization called PNI, which is working on messenger RNA, so they received some funding from the ISED program as well.
Senator M. Deacon: Part of the reason for that question is that depending on where we are going with these vaccines in the future, there are supply materials and support materials that are really specific and refined for which we are relying on other countries.
Therefore, my long-term wonder is: Will we have to continue to solicit support materials like the fatty bubble that is used for the mRNA from other countries and how we are looking there?
We have been told and it has become politicized that with our capacity to design and implement vaccines some of the responsibility lies on multiple levels of government. However, the consistent response in Canada is that we have not had facilities that were up to good manufacturing practices.
I would ask if you could tell this committee in writing what good manufacturing practices entail and why it takes so long to get them up to code?
On a final quick comment, some regular, everyday Canadians don’t have the opportunity to have these conversations. One of the things for both organizations to consider today is that we are here to champion you and we need to help. We need to ensure the communication is the best it can be.
Daily in Canada we hear about losses to COVID. We hear about how many cases, variant cases. It is very common that two or three levels of data are shared nationally in every province everyday. It would be awesome to add to that list today that we had x number of vaccinations done in this country and that the list was broken down by province because that is what Canadians are looking for. I think we could provide the data fairly easily moving forward.
The Chair: Your previous question, Senator Deacon, was linked to which department?
Senator M. Deacon: When we are trying to build capacity in this country for vaccines, what are these good manufacturing practices that are slowing us down?
The Chair: Mr. Krumins or Mr. Zielonka, who will take that question?
Mr. Krumins: My colleague Kaili Levesque can provide a quick explanation if that is deemed appropriate, but it is with Health Canada to answer.
The Chair: Thank you. Therefore we await that response.
[Translation]
Senator Dagenais: My question is for Mr. Zielonka, and for the occasion I’m going to put on my former police officer hat. I will go back to the famous $400,000 to fight money laundering. I don’t think we’re going to scare anyone with that kind of money. As for me, Mr. Zielonka, it seems like a fishing expedition with little chance of success.
I would like to know more details about the team you are going to put together, the quality of the investigators, and how long you plan to work in this complex field with so little money. Also, are you going to have to ask the government for more money?
[English]
Mr. Zielonka: Thank you, Senator Dagenais, for the question.
Just to be clear, we are one very small component of a much larger piece of the puzzle. We can think of it as a 1,000-piece puzzle and we are maybe one or two pieces of that puzzle. Other federal entities are very much involved in this, including FINTRAC, the RCMP and so on.
In terms of our portion it is very much a support functions and it is really focused around forensic accounting specialists. Those skills exist in the marketplace and we are looking at hiring those people who have specific training. I am an accountant by background. Specific training is available. It is a specialization that one can undertake to go through for that.
The other portion of your question is on the initial funding we have obtained. I don’t want to presume what funding will be made available in the future. This is something of importance, and I would hope funding would be made available in the future so that we could expand this work. I will leave it there.
[Translation]
Senator Dagenais: Now I have a question for Ms. Diogo. Ms. Diogo, you talked about the quality of hotel services for Canadians who have to go to a hotel. Unless I am mistaken, your criteria for the quality of hotels have not been made public, but would it not be normal for Canadians to know what they should expect in terms of the quality of hotel services, so that they can complain if they are not properly accommodated? We know that, at present, there have even been security problems in some hotels.
Ms. Diogo: Thank you very much for the question. On our website, there are all the criteria that we considered to select or designate a hotel as a facility where the traveller could go to wait for the result of their test done at the airport. This information is available. We are always on the lookout for information and complaints that are made, and we follow up directly with the hotels. People also have the option, especially when it comes to services that they have paid for, to make a complaint directly to the hotel.
Nonetheless, we are closely monitoring the situations that are reported to us to ensure that hotels are providing us with answers as to what actions are being taken on the ground.
Senator Dagenais: With your permission, Mr. Chair, I have one last quick question for Ms. Levesque. Ms. Levesque, I understand that you are in charge of the immunization rollout.
We were told this morning that Canada still ranks forty-third in the world for immunization, behind countries like Serbia, Turkey and Poland. Can we expect a significant improvement in the near future? Between you and me, Canada, as a member of the G7 countries —
Ms. Levesque: Thank you for your question. Indeed, you are right. We are about to do an overview, in the very short term, of the vaccination rate. As mentioned, we expect the curve to rise quite sharply over the next few weeks. For us, the most important criterion is the operating system that Major-General Fortin has put in place at the Public Health Agency of Canada, which works directly and closely with the provinces and territories. The criterion of transparency is also important for the provinces and territories, so that they have the capacity, once the vaccines arrive, to vaccinate Canadians as quickly as possible. Thank you.
[English]
Senator Duncan: Every Canadian has a distinct provincial health care number and information attached to it. That information is also generally covered by provincial or territorial access to health information and protection of privacy acts. When every Canadian receives their vaccination there is a record of that on that provincial health care number.
Does that fit in with the data management process that has been outlined and the monies that have been followed? Are we using the provincial health care numbers in the data management models? Where are we in terms of once Canadians receive a vaccination they receive documentation of that? Are we working toward some kind of national card or record of vaccination that can be used interprovincially?
Mr. Krumins: I will first turn to Ms. Levesque to answer part of that and she may defer part of this to Ms. Elmslie as well.
Ms. Levesque: You are right, senator. Each jurisdiction provides proof of vaccination at the point of immunization. There is a growing international conversation about what the certification of that immunization looks like, what the recognition of that looks like and the candidates therein.
We are trying to look from a scientific basis around what the spread and the question of immunity would look like as folks begin to travel. We are looking for consistency across jurisdiction or recognition thereof, but those conversations are very much live as this is happening.
I will defer to my colleague Ms. Elmslie on the rest of the question around data.
Ms. Elmslie: When it comes to our work with the provinces and territories in monitoring the evolution of the pandemic, we are not receiving personal identifying information. Our surveillance programs work directly with our provincial and territorial counterparts to provide anonymized information because at the federal level we are interested in monitoring trends that are occurring across the country and identifying concerns where we would need to act in concert with the provinces and territories.
We are very much alive to and focused on, as are the provinces, the protection of the privacy of individuals. We do not receive individual information that could be used to identify any individual person.
[Translation]
Senator Forest: My question is for Public Services and Procurement Canada. Our fiscal year ends on March 31. In Supplementary Estimates (C), you are requesting $9.2 million for office accommodation costs related to pension administration.
I have two questions, actually. First, what changes has Public Services and Procurement Canada (PSPC) noticed in the cost of accommodation in the federal government as a result of the widespread implementation of the telework policy, and what is the plan for the next few fiscal years?
Here is my second question: What is the impact of the COVID-19 pandemic on the commercial properties in PSPC’s real estate portfolio?
[English]
Mr. Zielonka: Thank you, senator, for that question. In terms of the $9.2 million, it is a 13% calculation based on the salary costs, so it is a standard number.
In terms of the broader question around the impact of the pandemic, we are seeing most of our employees continuing to work from home. At some point in time we anticipate that there will be a return to the workplace of some sort or some scale, but what that looks like is still not determined.
We have a clear picture of that. We are already starting to try to define longer term plans, knowing that there will be more telework in the future. However, we have a very large portfolio of properties that we own as the government. As needs change, obviously those are the ones we will look at to dispose of.
In the same vein we also lease a large portion of office accommodation for our employees. In many cases those are longer term leases. As our needs and the needs of our partners across government become clearer, our ability to transform that portfolio will take time. It will likely be a number of years.
[Translation]
Senator Forest: I have one last comment. So, if we are going to manage well, we need to plan for the profound transformation in the way we work because of COVID. What I understand is that you are assessing and planning, in the medium and long term, for the impact of these changes in the way we work.
The Chair: Is this a comment, Senator Forest?
Senator Forest: Yes.
[English]
Senator Marshall: I am looking for clarity on a question I asked in the first round. Mr. Zielonka, you responded. What is happening with the inventory of supplies? What I was looking for is: Are the problems that were experienced early on resolved now? Is the inventory being totally allocated to the provinces and territories? Is there a certain amount set aside for a future pandemic or a third wave or some other catastrophe?
I am just trying to get a handle on what is happening with the inventory of supplies.
Mr. Zielonka: My answer was pertaining to the essential services contingency reserve. I think what you may be referring to is the National Emergency Strategic Stockpile. If that is the case, I would turn that question over to our colleagues at the Public Health Agency of Canada because I think they will be better equipped to answer it.
Mr. Krumins: Thank you, senator. Cindy Evans will be able to respond to this.
Ms. Evans: We continue to receive a steady supply of personal protective equipment. Our amounts fluctuate daily. That is rapidly allocated to the provinces and territories. We are moving it out quickly to them.
That is done in an 80-20 formula. We keep 20% within the National Emergency Strategic Stockpile. That allows us to deal with additional surge requests from individual provinces, particularly if they have an unexpected outbreak.
In moving forward and looking to the future to stabilize at a higher level, we are looking at having an eight-week supply within the National Emergency Strategic Stockpile with respect to the pandemic supplies that are needed.
As I mentioned, those centre around six primary commodities for the COVID-19 aspect. Those would be N95 masks, respirators, surgical masks, face shields and gloves. It is quite important that we are continuing to work with the provinces and territories.
One of the fundamental bases underpinning our federal emergency management and the National Emergency Strategic Stockpile is that provincial, territorial and local governments are prepared and able to respond in a reasonable manner to the most common emergencies. The ongoing dialogue with them in terms of where they are having issues procuring their own distribution mechanisms becomes an important part of our discussions in best preparing ourselves moving forward.
The Chair: Thank you very much. Before we adjourn the meeting there are a few items of consideration that I would ask of Public Services and Procurement Canada through Mr. Zielonka and of the Public Health Agency of Canada through Mr. Krumins.
As we all know as a matter of fact, when we were given the order of reference to do an analysis of the vote we have discussed today while studying the Supplementary Estimates (C) we also have a time frame. I want to thank both of you and your officials for being here.
However, I see that many answers will be coming forward through the clerk. I would like to remind ourselves and the two departments through Mr. Krumins and Mr. Zielonka that when I look at the agenda of the Finance Committee to bring forward and table our final report to the Senate, it would be imperative, and I would say needed, to have your undivided attention so that we can meet our agenda and table a report. I repeat myself that written answers to many questions will be coming from your two departments.
I am making a request through both of you to your departments. When I look at the calendar it shows that we would appreciate if we could have those written answers by Thursday, March 11, at the latest. If it is not possible, please advise why it is not possible through the clerk.
Do I have an agreement, Mr. Krumins and Mr. Zielonka?
Mr. Krumins: Yes, I fully agree and support your request. I recognize the vital importance of your role to scrutinize these estimates. We will do what we can to make sure you have the information necessary to undertake that role.
The Chair: Thank you, sir.
Mr. Zielonka: Absolutely the same thing. We will do everything in our efforts to meet your timeline.
The Chair: Thank you very much. We appreciate that we are working together because we have a common denominator. It is about transparency. It is about accountability. It is about predictability and reliability for all Canadians.
That said, honourable senators, our next meeting will be March 8 at 1 p.m. EST.
Before I declare the meeting adjourned, I would like to ask permission through the clerk that we have a very short meeting with the members of the steering committee. Please stay on Zoom and we will address a few items that we need decisions on.
Honourable senators, I now declare the meeting adjourned.
(The committee adjourned.)