Federal infrastructure spending lacks transparency, budget watchdog says

theglobeandmail.com
By Bill Curry
Feb. 2, 2017

Parliament’s spending watchdog says the federal government’s centrepiece infrastructure program is not transparent and appears to be falling behind schedule.

Parliamentary Budget Officer Jean-Denis Frechette released a report Thursday that builds on his office’s concern about the pace of federal infrastructure spending, which was a major feature of the Liberal party’s election campaign and 2016 budget.

That budget promised to get projects started quickly by launching a first phase worth $13.6-billion that would focus on upgrades and repairs of existing assets over a two-year period. A much larger second phase is expected to launch this year. Combining new and existing programs, the government is promising to spend $186.7-billion on infrastructure over 12 years.

With all of that spending, the PBO argued in its report Thursday that there should be clearer reporting on what has happened so far.

“The government has provided no performance measurement framework with which to evaluate the [National Infrastructure Program]’s performance, and only limited visibility on tracking how the money is being spent,” the PBO staff said in the report.

The $13.6-billion set aside for the first phase has been divided across 31 federal departments and agencies. The PBO contacted each one as part of its assessment. Most of the data was collected in September and October but figures from Infrastructure Canada are current as of Jan. 4.

Of the $13.6-billion, the PBO found that only $4.6-billion worth of projects have been identified.

“While departments have committed to spending all of the allocated funds within the time frame provided, these data show that there remains a significant gap,” the report states.

Any delay on the timing of infrastructure spending would mean the impact on the economy would be later than the government had projected in its budget planning.

Finance Minister Bill Morneau’s 2016 budget estimated that the first phase of infrastructure spending would raise gross domestic product by 0.2 per cent in 2016-17 and 0.4 per cent in 2017-18.

Federal Infrastructure Minister Amarjeet Sohi, as well as municipal officials, defended the process Thursday. They said the precise timing of projects can be difficult to track because in some cases, bills are submitted at the beginning of construction and in other cases at the end, depending on provincial rules.

“Investing in infrastructure is a big part of our efforts to grow the economy,” Mr. Sohi said. “Sometimes you will not see the results for a number of years because it takes a lot of planning, it takes a lot of detailed engineering work to be done, before the projects start.”

Mr. Sohi and senior officials from the Federation of Canadian Municipalities spoke to reporters Thursday morning on Parliament Hill, where Ottawa announced funding for the FCM that will provide training to municipalities on how to manage the timing of infrastructure repairs and adopt policies that address climate change.