PAC: 2021 Report of the Auditor General on COVID spending: Childcare, Internet, Tourism Loan Guarantee

CLAUDIA CHENDER: You are a lot of people and expertise in a very short period of time. I’m sure we have more questions, but I’m going to ask a couple of questions on some of the other topics that were here today.

I just have one question on child care and early learning. I think one of the findings from the Auditor General was that things were maybe not documented or organized as well as they ought to be. One of the big things that we heard throughout the pandemic - everyone will remember “Stay the blazes home” as the famous phrase, but the other famous phrase less appreciated was “organic child care.” That was one that really, really rankled.

One of the questions we got consistently was about child care for essential workers, which I know is not within the scope, but I think it is because it goes to that decision making and documentation piece. I’m wondering, were there conversations about giving essential workers more than organic child care during the pandemic?

SARA HALLIDAY: As we mentioned early in March or mid-March, the decision was made to close licensed child care centres. We have unlicensed child care available in our province. Many of you would know that as a grandparent, a neighbour, an aunt, uncle -someone in the community who delivers child care out of their home. That’s an acceptable form of child care in our province, as long as certain numbers are maintained.

The unlicensed child care did remain to be available and an option for individuals who were seeking child care options during that time, but regulated child care was part of the mandatory closure.

CLAUDIA CHENDER: I could talk about this all day, but I’m going to switch to some internet questions. I will just momentarily editorialize and say that I don’t think that answered my question, about what discussions were had. In the spirit of learning forward, I would say that was a huge mistake and we’ve seen the stress on our frontline workers. We’ve seen the shortages of essential workers and I think that was a huge miss on the part of the Province - no personal aspersion intended.

Turning to the internet. I want to ask a bunch of questions, but I’m going to start with the AG’s observation that the trust indenture notes that the unspent funds in the internet trust will be distributed to underserved municipalities, and after that, successful proponents from the RFP processes to maintain the investment internet infrastructure.

This is going to be to either Mr. Farmer or Ms. MacDonald or both of you, if you’d like to answer it. We heard a little bit from i-Valley about the kind of chokehold that ISPs have on internet not just in Nova Scotia but in Canada, and the ways in which that leads to incredibly inflated costs for internet, which I’m hoping I’ll have a chance to get to.

Given the concerns we’ve heard, does the option of divvying up the remaining funds to those ISPs - does that sit well with you? It doesn’t sit great with me. I’m just curious if you have any comment on that.

SCOTT FARMER: I’ll invite Ms. MacDonald to comment as well. There is all but $29 million committed at this point, and the way that it’s structured is that it goes to underserved municipalities and then to ISPs for long-term capital improvements. However, we still have work to do in terms of the full rollout and getting as close to 100 per cent of internet coverage as is possible. We anticipate that the vast majority of the $29 million remaining will be consumed for that purpose. Perhaps Ms. MacDonald can add to that.

MARGARET MACDONALD: I was not involved in developing the contents of the trust document, but having been involved in the project over the last three years now, I think it makes sense. There is a finite amount of dollars and there’s a finite amount of time, and so I think the observation was that it’s probably useful to allow that money to continue to make sure that anybody who is left underserved, if that happens, would have access to some additional money in order to try to complete that. I don’t know the thinking that went into some of those terms, but that would be my understanding.

I would also like to say, and I confirm what Deputy Farmer has said - our expectation is that we will spend almost all the money, if not all of it. Develop Nova Scotia has done an incredible job of identifying all of the areas and all of the underserved and difficult-to-serve household units in the province. We go over that number bi-weekly, see how it’s being addressed, see what it’s going to cost us - because those will be some of the most expensive places to get to in terms of trying to serve those folks. That’s what we’re working on.

While there may be some dollars left over, it’s really unlikely that there is going to be anything significant left over after the project is done.

. . .

CLAUDIA CHENDER: I want to quickly go back to the tourism loan guarantee. My understanding of that is that the guarantee is from Dal. Those funds are incurring interest. They’re going back into the pot. The reality is that if none of those large anchors default, then that money just sits there, unavailable for government revenue, and then goes directly to Research Nova Scotia. There won’t be an opportunity to reuse it because if nobody defaults, at the end of the term of the trust, that money is still there. I think the AG specifically said that seems like not a good arrangement particularly.

I guess I want to go back again. I don’t know if Mr. Farmer or Mr. Gatien - probably Mr. Gatien. Will the government reconsider this arrangement, given the criticism of the AG, and given that essentially it’s likely to be a $30 million bequest to Research Nova Scotia that didn’t happen under any normal kind of government auspices or channels when we are in a deficit position and we could use those funds if that guarantee sat with the province, rather than with Dalhousie?

GEOFF GATIEN: I have to think through some of the implication if it did sit with us. It’s not my decision what government considers going forward or not with those funds. The letters of credit do exist. I’ll simply note, Research Nova Scotia has received significant sums of money because the research has been valued as well.

I don’t know if there would be interest in government revisiting that or doing a different approach. The source of authority to provide guarantees - the Nova Scotia Jobs Fund was closed - the flexibility that this fund with Dalhousie provided, did provide the flexibility to respond quickly to these anchor tenants.

I don’t want to be too presumptuous that it’s going to be easy times for them to honour obligations, because I expect that their businesses have been quite substantially impacted even as people start to travel a bit more now.

CLAUDIA CHENDER: Thank you, but can I just confirm that if that was the appetite, are you saying that would not be possible, given the closure of the Jobs Fund or would it be possible if there was an appetite in the Executive Council or whoever would determine that to change those agreements?

GEOFF GATIEN: It would be something that we would explore. There may be other options available.

CLAUDIA CHENDER: I guess just a follow-up . . .

THE CHAIR: I’m sorry. We’ll move on to the PC caucus.

Full Transcript: https://nslegislature.ca/sites/default/files/pdfs/committees/pa/pa_20211201.pdf