The committee met at 8:01 a.m.

[M. Bernier in the chair.]

M. Bernier (Chair): Good morning, everyone. Welcome. It’s Wednesday, October 6. It’s great to see everybody again this morning — two days in a row, and another committee meeting — to talk about another report.

Today we are going to be reviewing the report on the Update on the Connecting British Columbia Program, from August 2021, which was only a month ago — or two, I guess, as time flies here.

It’s great to see everybody again. As I was talking with the OAG, we’re trying to stay on top of these reports, and I appreciate the work that the committee members are doing, as well, when these reports come forward to read and review — and come prepared, as they did yesterday, with some great questions.

Today we’re just going to turn things over again, right away, to the Auditor General.

Good morning.

Consideration of
Auditor General Reports

Update on the
Connecting British Columbia Program

M. Pickup: Good morning, everybody.

I would like to start, of course, by acknowledging, with respect, that today I am on the lands of the Lək̓ʷəŋin̓əŋ-​speaking people of the Esquimalt and Songhees Nation. I’m grateful for being a visitor on these lands and try to strive to be mindful of the connection it holds for all Indigenous people of the territories — particularly so, being a member of the Miawpukek First Nation on the far other side of this country. It’s pretty much as far away from British Columbia as you can get. It is something I try to keep in mind every day as I enjoy this wonderful, wonderful place that I now call home.

Thank you to the committee. Yes, we reported on this in August. As I mentioned yesterday, it is wonderful for us to see the engagement. You can see the smiles to my left, to your right, because it does mean something to see you on top of our reports. Obviously, I say with all due respect, mindful of your independence and our independence, it is wonderful to see these reports being called in so early, and it does help keep our folks super engaged and interested as well. So thank you for that.

A big thanks to our team. I appreciate all the work that has been put in. This is relatively quick for a report like this to happen. It’s thanks to the folks on my left and people who aren’t here today.

By way of introduction and thanks, I want to thank Amy Hart, the executive director, performance audit, from our office, who led this work, and Janice Dowson, who is sitting next to her, who was very instrumental in seeing us get through this report. You’ll have the pleasure of hearing Janice in a second as she walks through this report. Not with us today is Malcolm Gaston, the Assistant Auditor General, and Lisa Sevigny, a manager who did a lot of work on this report as well, who is home with a new baby. That’s where she’s spending her time today and not here with us.

I’m also grateful to the staff at Northern Development Initiative Trust and the Ministry of Citizens’ Services for their cooperation during this work. It’s okay for us to be interested in trying to get something done quickly, but without cooperation on the other side, we will never be able to achieve this. So I want to thank folks for being willing partners in the bigger objective of seeing this work get through on a timely basis.

[8:05 a.m.]

Of course, I want to thank the Clerk of Committees and the office of the comptroller general, as well, for their cooperation and assistance in getting us here today. Lots of thank-yous all around. I think that is fitting as we are on the verge of Thanksgiving weekend, which I believe was first celebrated in Canada in 1879. But that tradition existed long before that with Indigenous peoples as a big part of the culture of being grateful.

Certainly lots to celebrate, and I think it’s always appropriate and in vogue to be thankful. I certainly take this opportunity to wish each of you a wonderful Thanksgiving weekend as it comes up very quickly. I will now turn it over to Amy, who’s going to do the walk-through and the presentation.

M. Bernier (Chair): Thank you, Michael.

Maybe I’ll just interrupt for two seconds just to remind everybody present, too, that under the communicable disease program that we have here, everybody has to have masks on unless you’re speaking or consuming something to eat or drink — just as a reminder. Thanks.

A. Hart: Thank you, Michael.

Good morning, Chair and committee members. Thank you for your interest in our information report on the connecting British Columbia program, which was tabled August 10, 2021. For today’s presentation, I will be taking you through the report at a glance, which provides a summary of the report, including an overview of phases 3 and 4 of the program and key information about these two phases.

I’d like to note that the information provided in the report and in my presentation was current as of May 31, 2021. Figures may have changed since that date as phases 3 and 4 continue to progress. Access to high-speed Internet is increasingly essential to education, health care, public safety, access to justice, economic development and many other aspects of daily life.

British Columbia faces what is often referred to as a digital divide. Although almost all urban areas have access to high-speed Internet, 60 percent of rural and remote communities and 62 percent of rural, Indigenous communities still lack Internet at the 50/10 Mbps target speed.

The connecting British Columbia program provides funding for Internet infrastructure in rural and remote areas of the province. The program is funded by the Ministry of Citizens’ Services and administered by Northern Development Initiative Trust. Since 2015, the ministry has provided $190 million in funding across four phases. This report provided information on phases 3 and 4 of the program, which are still ongoing and account for $140 million of the total commitment.

The ministry provided $50 million for phase 3, which launched in 2019 and aims to achieve a goal of 58 percent of rural and Indigenous communities with access to high-speed Internet by March 2025.

Additionally, the ministry provided $90 million for phase 4, which launched in 2020 as part of the StrongerBC economic recovery plan and aims to improve connectivity in 200 communities, provide service along 140 kilometres of highway and at 14 rest areas, and install four call boxes along B.C. highways.

Although we were planning to do an audit of the connecting British Columbia program, we shifted our approach when government extended the timelines for the program. Instead of delaying the audit, we chose to do an information report. We did not audit the information in this report. Instead, we compiled the information provided by the ministry and Northern Development Initiative Trust to provide timely details about the program.

I will now walk you through some of the key information provided in our report.

[8:10 a.m.]

As of May 31, 2021, phase 3 had committed $48 million for 85 projects expected to benefit over 29,000 households, and phase 4 had committed $85 million for 55 projects expected to benefit over 32,000 households in 224 communities and provide 429 kilometres of new cellular coverage along highways.

As previously mentioned, the timelines for phases 3 and 4 were extended beyond their original end dates. For phase 3, the original completion date was March 31, 2022. This date was extended to March 31, 2025. For phase 4, the original completion date of October 31, 2021, remained in place for most projects, but some projects were granted extensions to October 31, 2022.

This information report also outlined external challenges that the ministry and Northern Development Initiative Trust indicated impact funding uptake, project timelines and outcomes of the program. These challenges include higher Internet speeds requiring complex construction; federal funding timelines, which can extend project completion dates; and the need for Internet service provider participation.

Finally, I would like to highlight the three questions that are included in the Report at a Glance for readers to consider as they review this report.

In closing, I would like to thank the dedicated and enthusiastic staff at Northern Development Initiative Trust and the Ministry of Citizens’ Services for their support and cooperation during our undertaking of this report.

Thank you very much. I will now turn it back over to the Auditor General.

M. Pickup: Thank you so much, Amy.

We’re trying to keep these presentations relatively brief and to the Report at a Glance.

I think the only additional comment I might make would be that one of the thoughts I had around this report and some of the discussion we had on the team and some of the other discussion we had with the organizations we were working with is about the type of information that this report is providing and the summary level of detail that perhaps, in this format, may not have existed elsewhere so as to help inform you folks in doing your job in holding the government accountable and asking the government questions. That really was a big part of the intent, which is wonderful, I think, to inform a discussion and question period like this.

Pausing for a second, I think one of the fundamental questions is: where do you get this information from going forward? And what type of information you’re going to get…. I think that was part of why we posed that question at the end of the Report at a Glance, to say: this gives you a certain amount of information, as that may, but what are you going to be getting forward, in a very consumable fashion, that gives you the type of information that you need as well?

I will leave you with that thought and then conclude at that.

M. Bernier (Chair): Thank you, Michael.

Before we jump over to Shauna, I know that MLA Anderson, I think, had a question.

Did you want to ask that now, then, pertinent to this?

B. Anderson: I can wait.

M. Bernier (Chair): Maybe we’ll wait until the reports are read out, and we have a bit more information. So maybe I’ll turn things over to Shauna.

Thanks for being here. You can introduce you and your team, I guess.

S. Brouwer: Good morning, Chair, committee members and officials from the Auditor General. My name is Shauna Brouwer, and I’m the Deputy Minister of Citizens’ Services. Joining me today are CJ Ritchie, who is the associate deputy ministry and government chief information officer for the ministry, and also Howard Randell, who’s the acting ADM of the connectivity division. I thank them for being here today with me.

My ministry will be presenting to the committee today. I just wanted to let you know that we did not invite Northern Initiative Trust as this is an information report only and the challenges noted in the report are largely beyond the scope of NDIT to influence, so we didn’t have them come down today.

I’d like to begin by thanking the Auditor General and his staff for the information report as well as their commitment to improving connectivity in British Columbia. I’d also like to thank the Chair and the committee for the opportunity today to respond, give an update and take your questions on our progress, challenges and the questions that you’ve posted in your summary report.

[8:15 a.m.]

As the report indicated, the Auditor General prepared an information report on the connecting British Columbia program. The focus of the information report is on phases 3 and 4 of the program, and I want to clarify that the report is not an audit, as you well know. Phases 3 and 4 are currently underway, and many projects are not yet complete.

The province is a funder of the program, and the program is administered by the Northern Development Initiative Trust. Program funding decisions are made by the trust granting committee, and ultimately, the trust reports to its board.

At the trust’s request, the province provides program guidance and assists by providing technical reviews of program applications. We do a lot of the technical analysis in-house. That would be Howard’s team. The trust is obligated to provide the province with monthly, quarterly and annual financial and program performance reports.

In the report, the OAG noted some challenges in delivering a program that funds Internet infrastructure in rural and remote areas of British Columbia. Higher speeds require complex construction. Often this includes aerial fibre builds where the wire is strung between poles that are jointly owned by Hydro and Telus, the current incumbent.

Sometimes fibre is buried, and this requires rights-of-way permits from the Ministry of Transportation and Infrastructure. Projects may require multiple permits from local governments, provincial, federal or Indigenous governments.

There are also events that no one can predict that could also impact the build timelines. Right now the pandemic is influencing those things. We have supply chain issues, the wildfires and then just the regular building seasons of the winter in the far north.

The federal government timelines can also extend our project completion dates. We have seen the federal funding programs, such as the universal broadband fund and the CRTC broadband fund, become overwhelmed with the number of funding applications.

The federal election that just concluded will also have an impact on our timelines. Our ministry is working very closely with federal government peers to expedite federal funding decisions on British Columbia where possible. We’re looking forward to the new federal minister being appointed and making that connection between our two ministers.

The program requires Internet service provider participation. Connectivity infrastructure is built and operated by private sector, both large and small, Internet companies. ISPs prioritize locations where there is a business case and they can make a profit, which is usually in urban and densely populated areas. Making a business case with a return on investment in rural and remote areas is a challenging proposition. The ISPs are reliant on government funding to help improve the business case for capital investments. That was, I think, clearly noted in the report.

On slide 3, the Auditor General posed three very important questions.

Thank you, Amy, for highlighting those.

Why is the government extending the timelines for this program? The program timelines have been adjusted to align to the federal government programs now in play to maximize and leverage federal funding for projects in B.C. We’ve managed to leverage quite a bit of federal funding.

Program timelines have also been adjusted to accommodate ISPs’ ability to deal with supply chain issues because of the pandemic and also wildfires. We’re seeing more requests now for extended timelines because of supply chain issues very specifically.

On slide 4, another question posed by the Auditor General is: how will government keep legislators and the public informed about progress on the program? The program will maintain a list of approved and announced projects, by phase, available to legislators and the public. We’re currently working on a visual map, which will be published, containing projects’ locations and project status. We’ll make that available on our website. We do quite a few announcements at the start of a project and at the completion of the projects. We’re looking forward to having that in place, I believe, around the end of October. Howard can correct me if that’s not quite right.

Finally, the Auditor General asked: how is government meeting challenges faced by the program? The program maintains a very close working relationship with the federal government department officials in Ottawa and the Internet service providers, both large and small, across B.C. to remove barriers and expedite timelines where possible. In fact, the ADM of connectivity is currently actually in Ottawa.

The program, through Forests, Lands, Natural Resource Operations and Rural Development, established a one-window approach at the FrontCounter in Prince George to help expedite the permit approvals for the phase 4 projects — so very proactive in developing a cross-government ADM table to help with permitting.

The province is also exploring options to expedite hydro pole attachments and to address the concerns raised by the telecommunications industry. Minister Beare and Minister Ralston both had an information session with northern local governments to review concerns that they brought up around passive infrastructure. We’re working through those now.

On slide 6, I’d just say the government appreciates the analysis and questions posed by the Office of the Auditor General.

[8:20 a.m.]

We accept the information report and the findings and the questions posed, and we’ll continue to execute on efforts to improve connectivity to as many British Columbians as possible.

On slide 7, we’d be more than happy to take the questions of the committee.

M. Bernier (Chair): Thank you, Shauna. Thanks, everyone.

I’m just going to turn things over to Carl.

As always, I like to have your opinions, Carl.

C. Fischer: Thank you very much, Chair. I don’t have any other comments.

M. Bernier (Chair): Okay. I’m going to turn things over to some questions right away from some of the members.

B. Anderson: Good morning, and thank you, everyone, for your work. I get so excited about rural connectivity that I kind of jumped the gun there with wanting to ask a question a little early.

As a rural MLA representing Nelson-Creston, I know how important connectivity is. When you listed off that digital divide piece and the equity piece…. You listed health care, education, and as we saw over the pandemic, it was also governance, because people needed to have access to participate in the Legislature and to participate in local governments. Quite frequently, we would have, in some of our areas…. Our rural directors would actually have challenges connecting to the meetings online because they don’t have access to stable enough Internet.

I thank everyone for the work. I was really pleased to see that the Creston Valley was listed as one of the areas in this report. Creston, of course, is in my riding. I was wondering, if it exists anywhere, where we can actually see where we’ve achieved our goals, where we’re working on it and where are places that we have yet to get to, where we’ll be planning for in the future.

I just want to see where we’re at in terms of geography. I recognize that it’s not really easy to put a map with such…. It’s very detailed, in terms of mapping of where that connectivity is, but I was just curious if that existed anywhere in the Ministry of Citizens’ Services.

S. Brouwer: Yes, we do have a map with all of the available and ongoing projects right now, but it wouldn’t be in a form that I think would be very user-friendly. What we’re working on now is basically what the Auditor General had suggested — a map that’s a bit more user-friendly for local governments and citizens to see where exactly connectivity is in place. What we have right now is really very technical and not what we would propose to use for the public, but we’re certainly working on that.

B. Banman: Thank you for the report.

Before I get into my question, I just want to pick up on something that my colleague has just said. The biggest challenge that I’m hearing as the critic of this ministry is: “Look, we’ve been waiting forever. Where is it? How long is it going to take?” I think a map that is user-friendly, that the public can actually access would be just so helpful.

It’s the not knowing. It’s kind of like when you’re, “Why is my plane sitting on the tarmac?” and you’re not knowing. It’s that not knowing that is always worse. I think the more information we can give the public — even though those that may have to go into town so they can actually connect to see how far along they are and how long they have to wait — would be very, very helpful.

The other thing that would be helpful is, I think, something as simple as red, yellow, green. Are we on target? Green; Are we behind? Yellow; Is it dismal? Red. And an overall percentage. If the goal is that we want 100 percent in rural areas, what percentage have we actually achieved? Now, I saw that was in the other report. But I think, as we move forward, it would just be simple, especially when the public who would access some of this information…. It would just give them an idea as to where we’re on target.

The last thing I want to mention is that I can tell you from a municipal perspective, B.C. Hydro is one of the most frustrating…. Their ability to move poles…. I don’t know what their issue is, but it needs to stop, and it needs to change. When we’re now talking about a Crown corporation that’s now in a report that says they seem to be one of the problems, I think we need to fix that problem. I think we should have the power to fix that problem.

[8:25 a.m.]

I think it needs to go way up on their food chain as to their level of what’s important, because I can tell you, there are roads municipally that have a telephone pole sitting in the middle of them for a long period of time. It’s just not acceptable. Something needs to be done to help expedite that process. I think that message needs to be sent to that particular corporation loud and clear — that they can no longer be one of the reasons that broadband is not getting there.

The pandemic has shown us, as was mentioned, that connectivity is incredibly important. So many people ended up working from home. I believe that’s a trend that’s going to stay. I believe that when you take a look at the cost of homes, rural areas, as we already know, are showing a trend where people are buying out into rural areas and expect to be able to do business from home. Whatever we can do to speed this along I think would be cheered from the rural parts of the province. I don’t live in a rural part of the province, but my mother does. She’s still on dial-up, which doesn’t really work that well.

I want to thank you for the report. If we can burrow down, for instance, as to why Hydro seems to be the problem…. I think that should be a question that could be passed along and have that particular item sorted out. I thank you very much for the report.

M. Bernier (Chair): I’m not sure if you want to comment, Shauna.

S. Brouwer: No. Just thank you for your observations. I wouldn’t necessarily disagree with any of your comments.

M. Bernier (Chair): We’re going to go around. I’ve got almost every single person having some questions. This is obviously an important topic.

N. Sharma: I have a couple of questions. The first one. The kind of higher-level stats that were in the audit, about 65 percent of communities that groups rural and Indigenous…. I’m wondering about the next layer to that. As a group of funding, how can we make sure that Indigenous communities aren’t falling behind in terms of access to some of that funding? They may not be, but I wondered about that measure.

My second question is kind of linked to that. The work with the federal government…. I’m just curious what you expect the percentage of their money, in terms of paying for that, would be. Are we paying, as a province, for most of it? Are they not? And in particular for on-reserve infrastructure, is the federal government giving what they should in terms of their responsibilities for that kind of infrastructure? Those are my questions.

S. Brouwer: The first question, I think, deserves a little bit of attention. Are Indigenous communities falling behind? I would say that they’ve started behind, because a lot of them are in rural and remote communities. I would acknowledge that they’re behind from the start and that we’re working diligently to move that forward. I think that’s very important work, and it’s one of the key areas that our ministry can contribute in terms of reconciliation.

The declaration action plan has one of the items listed as connecting all Indigenous communities, and I look forward to the results of the final consultation and where that is in terms of priority. So I would say that, yes, we are starting from a behind position.

Once all of our projects are online, the ones that we’ve all approved now, we intend to have about 60 percent of rural Indigenous communities connected, but that will leave about 81,000 households underserved. So there’s still more work to do beyond that piece. Of those communi­ties…. I’ll see if I can get this right. After the end of it, there will be about 120 communities that will be underserved. That would leave about a 7,800-household gap. We are tracking things very closely, down to the community level.

In terms of the non–First Nations communities, we would have a gap of about 347 communities and roughly 74,000 households. We’re tracking very closely to make sure that we are covering the province on that.

In terms of your question around federal funding — what are we able to leverage from the federal government? — right now we’re in negotiations with the federal government on a memorandum of understanding. Our hope is to come up with some one-to-one federal funding leveraging. We’ve seen some good success in Quebec and Ontario, and we’re hoping to have that same relationship with the federal government. So we’re moving on that.

[8:30 a.m.]

You had one more question about on reserve and whether the federal government is paying their fair share. I’m afraid I can’t answer that. Maybe…. I don’t know if we have any other information, but I wouldn’t be able to comment on whether it’s their fair share. I’m not aware of that.

Howard or CJ, do you have anything to add?

H. Randell: Thanks for the question. With respect to the fair share, yeah, certainly Indigenous communities are a priority for both our program and the federal government as well. When we look at projects and opportunities, we relay that to the ISPs. A lot of these builds aren’t just single communities.

What they’re actually doing is extending service from existing service areas out into more rural areas. In fact, the approach we often take is more of how do we get to the Indigenous communities and pick up the other communities along the way? It is a priority, and we are actually viewing it as such to make sure that none of those Indigenous communities get left behind in these builds.

D. Coulter: Thank you for the report, both from the Auditor General and from Citizens’ Services. I think this is really important work, so I’m actually really excited about the connectivity of rural areas.

Do the wildfires and all these other things that we’re delaying some of these projects for…? I’m just wondering is that going to cost more money? I assume it is. If you need any more…. It says here in phase 3 you only have — I’m going to round up — $14,000 still available for project funding, or at least that’s what the Auditor General’s report says.

S. Brouwer: If I may. We don’t intend to spend any more money on those projects. They’re bid out under performance contracts. Basically, they have milestones to deliver. So while we’re extending the timelines, we’re not actually increasing the value of the provincial contribution. So that remains the same.

You had one more question in terms of additional funding.

D. Coulter: Yeah.

S. Brouwer: The government, in this last budget cycle of 2021-22, put another $40 million into the next three years’ funding. There was another $10 million put in this year, and I believe 20, 20 and ten in the following years.

There is, actually, for the very first time, base budget funding in the ministry. Usually it’s been a one-time investment, but now we have a base budget going forward. We’re looking forward to having a long-term, continuous, predictable intake cycle with a routine way for local governments and regional districts to apply — and First Nations governments — for connectivity.

J. Tegart: Thank you very much, and thank you for the report.

As someone who represents a large rural area with over 30 First Nations bands, this report is incredibly important. Some of my questions are around the fact that when we have the phase 3 update, we see a lot of announcements. People’s expectations become very high, and we see a lot of delays. Their questions to our offices as MLAs are: “Well, the announcement was over 18 months ago. Where are they?”

As a rural MLA or an MLA anywhere in British Columbia, to be kept up to date once an announcement is made would be extremely helpful because we respond to those inquiries. You set expectations sometimes that are pretty high for our rural communities. Not really a question. Just a statement.

The other thing is: I’m interested in the gaps throughout B.C. Where we have providers interested in doing a project, it’s often based on whether it’s sustainable. What is the plan for our small rural communities that no one sees them as sustainable for a business plan? What is the government’s role? What is the commitment to that?

[8:35 a.m.]

As I read the report, I also thought about the incredible importance of provincial lead on partnerships with B.C. Hydro, with local governments around permitting. If we’ve got 85 projects across British Columbia running into difficulty, why aren’t we doing something provincially to ease the way? Why would 85 different projects need to be dealing with it? Why aren’t we looking at where those barriers are and addressing them with local government, with provincial government? It just tells me that there are just so many barriers, when people’s expectations are: “How hard can it be? Run a line, and get me some Internet.”

My last comment is…. One of the concerns I hear is, as we reach out to communities, how many homes are bypassed and told that they can’t hook up. They watch the work being done. They watch it go into the community two miles down the road, and they’re told: “Sorry. The project only services that community.” We need to address that. As the lines go by people’s properties, we need to look at that last mile.

Everybody in British Columbia realized the importance of connectivity during COVID. I don’t think we will ever go back to it being unimportant.

Those are my comments. If you have any response…. I’m sure you’ve heard them before.

S. Brouwer: I appreciate your comments. I would say that those were some of the themes that we’ve heard. We have a knowledge table for local governments. We’ve heard those themes. My minister has met with Minister Ralston. I know that the Deputy Premier has had conversations with the chair of Hydro. I’m meeting with the CEO of Hydro.

There are lots of opportunities to streamline and make things better, and we certainly have several tables on the go and active discussions around barriers, even prior to the report. We’ve been hearing it, also, firsthand from some of the local government tables that we’ve been hosting.

So appreciate the comments. We will work diligently towards removing those barriers.

R. Glumac (Deputy Chair): Thank you for the report and your presentation. Just to build on some of the questions that have been asked, I have a few questions.

Can you quantify the relative order of the challenges that are happening here? My colleague is basically saying that B.C. Hydro is the problem. Is B.C. Hydro the problem? It also mentions Internet service providers. I would like to get an understanding of…. As it says here, they don’t see a business case for extending service into low density and remote areas. Is that the problem? What’s the relative order of these problems? I wonder if you could….

S. Brouwer: First, I’d like to start with — and it’s going to sound a bit…. I’d like to start with the relative success of the program, actually. When we started in 2017, there was about 25 percent connectivity in rural and remote British Columbia. Right now we have, in progress, moving us to 38 percent, and by the time all of our projects are complete, we’ll be at 60 percent connectivity. That’s a massive step forward in terms of where we have been in the past.

I think the previous comments really highlight that COVID has shown us how important connectivity is just for everyday life. So I will take a moment just to thank the staff and the team and the groups that have been moving this file forward for what I consider to be very significant progress with a significant $190 million investment.

In terms of the challenges, it’s very hard to know exactly what the challenges are because everybody has a different perspective. One of the biggest challenges in British Columbia is our terrain. British Columbia is a beautiful province, but we’re surrounded by mountains, mountainous terrain, lakes in the middle of the province — all kinds of things. That does cause a lot of issues. We have highways that have no power. That impacts our ability to bring cellular to those places. So those are two that I would say stand out for me.

I think the challenges right now around the supply chain…. We have some places that can’t put up towers because they’re not getting the steel. I think the supply chain issues are real. Those will cause further delays.

[8:40 a.m.]

I am still…. The jury’s out for me, personally, in terms of B.C. Hydro and Telus connectivity. So we’re digging into that. We have some commitments from Hydro to try to move things forward and be more transparent with their processes, but we’re still working with them. I can’t actually say, in terms of degree, where that is in terms of systemic problems.

I can say that one of the number one problems we’re hearing from local governments is connectivity to passive infrastructure. So I would say it’s the land, it’s the supply chain, and it’s passive infrastructure. Two of those things we can help with more than the first.

R. Glumac (Deputy Chair): Just to follow up on that, you didn’t say too much about the Internet service providers. How much of an issue is that — that there is little business case to go into these areas? Are they dragging their feet? Are they delaying as well?

S. Brouwer: Well, private sector companies are there to make a profit for their shareholders. It is difficult at times, but many of the ISPs do have, I would say, a social conscience and do want to do the right thing. We see a lot of them connecting to rural and Indigenous communities. The province has provided grants, and the federal government has provided grants, to actually create a tipping point so that…. There is no business case, but with the additional funding, it kind of tips them over to the point where they will do that work.

We’re looking at some new models for the coming budget cycle of delivery that might incent that, but in a different way.

R. Glumac (Deputy Chair): One last question. In regard to the challenges, it mentions here that in 2016, the standards for Internet service speeds were increased. That was 2016. But phases 3 and 4 began and were scoped out, I guess, far after 2016. But that’s listed as one of the challenges. Can you help me understand? Wasn’t it already known, when phase 3 and 4 started, that this was already kind of built into the schedules? Wasn’t it?

S. Brouwer: I don’t know if you want to take that one, Howard?

H. Randell: At the end of 2016, the CRTC made a decision to make the standard, if you will, or the target speed 50/10. That was not part of the phase 2 funding. The phase 2 funding was still at the old standard of the target speed of Internet, which was 5 megabyte instead of 50 megabyte. So phase 3 and 4 did take that into account.

There was some modification to phase 4 funding because it was for economic recovery. So the standard was lowered to 25, just as sort of a transition up to that 50.

I’m not sure if that answers your question.

R. Glumac (Deputy Chair): The question is…. Phases 3 and 4 started well after that requirement was in place.

H. Randell: Yes, that’s correct.

R. Glumac (Deputy Chair): Wasn’t that incorporated into the schedule at that time?

H. Randell: Yes, it was.

R. Glumac (Deputy Chair): So that’s not really the cause of a delay or anything.

H. Randell: No. The 50/10 isn’t the cause of the delay. The primary causes for the delay are going to be…. Well, depending on the timing, but supply chain issues as the result of the pandemic, labour shortages and the timing of the federal government programs.

For example, the phase 3 money came out to leverage the CRTC fund, as well as the universal broadband fund — both federal funds. Both of those intakes, where we’re looking for that joint funding to leverage each other’s money, got delayed significantly. The provincial money was there — ready, available — but we had to wait for them to open their intakes to be able to get those projects going.

M. Starchuk: I thank you for your presentation. Really, I want to say big thanks for pointing out the positives of what’s going on — that we are increasing the connectivity for a lot of people that are out there.

My question is around phase 4, inside of your report that’s here. It says that the funding has earned $142,791 in investment income. I understand how you got it, but what I don’t know is what you are going to do with it.

[8:45 a.m.]

S. Brouwer: Oh, sure. That’s money that’s held by the Northern Development Initiative Trust. It would be the interest earned on the money while it’s sitting there waiting to be reimbursing the companies for their grants. That money will be reinvested back into the program.

M. Starchuk: And is it earmarked? Your report is very detailed as to where things go. Is that investment income earmarked?

S. Brouwer: I’m not sure how they put it in their financial statements at NDIT, but our agreement with them is to reinvest it back into the program. I’m not sure how they do their presentation.

A. Mercier: I’d like to thank the Ministry of Citizens’ Services for the leaps and bounds you’ve made on rural connectivity in the last four years. That’s something that’s improving a lot of lives.

I have a question just about coverage. In the OAG’s report, it talks about 94 percent of B.C. households having access to high-speed Internet, but then it switches to talking about communities when talking about lack of coverage. I understand that, in terms of identifying service areas that you’re delivering hard infrastructure to. It also helps quantify and understand the barriers to Indigenous communities.

I’m just wondering: what percentage of rural households have access to high-speed Internet? Is that comparable to the provincial average? Or are we seeing, disproportionately, a large number of smaller rural communities, as opposed to large rural communities, that have access?

S. Brouwer: I think I would start by saying that the 94 percent is largely driven by the dense urban population. That’s how they get to the 94 percent. In terms of connectivity in rural and Indigenous communities, as I said, we started at 25 percent. We will be complete…. Around 60 percent will be complete. I believe that right now, today, it’s around 38 percent.

A. Mercier: Is that a percentage of communities or a percentage of households?

S. Brouwer: That would be a percentage of communi­ties.

A. Mercier: Do we know the percentage of households?

S. Brouwer: That isn’t…. I’d have to send that one over. I think I’ve got some data on that.

C. Ritchie: We can probably follow up with that in writing.

What I will say is that it’s a more complex arrangement than it seems. Even when you’re counting communities — although that seems very simple at the high level — there are criteria about what constitutes a community. If you have a cluster of five houses along a highway somewhere, that isn’t counted in that count. Any time you count homes versus households versus families versus communities, the numbers slide and change. We can get you a household number, but we’ll have to follow up with you in writing at that time.

M. Bernier (Chair): We were just saying that, through the comptroller general, we’ll try to get that information and share it back to the committee afterwards, because that’s a very good point. As a rural person, I was going to ask something similar. Thank you.

I know that MLA Anderson had….

B. Anderson: The question was asked by one of my colleagues. Thank you.

M. Bernier (Chair): Okay. Maybe I’ll just say, too…. I do want to thank you for the work, not only for the review of what’s taking place but to the ministry as well.

As a rural person, and to Andrew’s point, one of the frustrations that we hear in rural British Columbia is when we use the 90-ish percentile numbers, because that’s not where it actually hits the ground in a lot of rural areas — which is where, through the ministry and through NDIT, we’re trying to solve the gaps and fix those gaps.

Even in a riding like mine, you’ll have a rural community that’s identified as a community. But when you look at the households, there are still half the households in the community that might not have access, even though you could check off and say: “Yes, there’s access in that community.” It’s really hard to quantify sometimes, down to the granular level, to explain it to people.

I sat on the NDIT board for quite a few years, so I’m very familiar with how they operate and try to work, but I know that one of the frustrations that I hear — maybe my first question — is around, maybe, any of the gaps around criteria for the small providers. Have you heard how we can try to solve some of those?

Now, I’m hearing from the providers. I’ve talked to NDIT about this. As Shauna said, your larger corporations…. Well, I’ll leave names out of it. Yes, they’re worried about their shareholder paybacks, and they have to look at those issues when they’re going into a rural area, on a cost recovery.

[8:50 a.m.]

Grants are very important for the balance sheet, sometimes, to make it work, but the small providers that are going into communities — that, maybe, serve 500 people or 1,000 people — are the ones that sometimes will make or break whether it even happens. But I’ve heard that some of the criteria can be an issue, for them to qualify. Have you heard that? I just wanted to try to maybe find out if that’s true or not.

C. Ritchie: I would say, in some cases, it’s less about being able to qualify because of criteria. Putting infrastructure in the ground is an expensive effort. So for some smaller providers, there’s a capital output necessary that they can’t participate in. I would say, for the gap that exists, as we get a higher and higher percentage of connectivity, it means that what’s left are the hardest areas to cover, either from a geographic perspective, a business model perspective or whatever.

The province knows that there are probably some other technologies that will have to come into play, things like low-earth-orbit satellites, for example, to get that type of coverage. So there may be smaller, niche providers of those types of services that we’ll have to tap into in order to meet all the apps that we have. Does that make sense?

M. Bernier (Chair): Absolutely. I appreciate that. One of the things, I guess, to follow up…. I can’t remember if it was Bruce or Jackie who said, about making the announcements, maybe quantifying them a bit. It’s not like making an announcement for building a bridge or paving a section of a highway or something, where people kind of have the expectation that it could take two, three, four or five years to get down the road to an actual ribbon cutting.

This, obviously, is a lot more personal. COVID, I think, highlighted it a bit, but this was way before COVID, where we were hearing that people were trying to educate their children through distance learning, but they can’t because of access to Internet. I appreciate the fact that there’s been a lot of work going into this, because it’s important, but as it’s highlighted here, there’s a lot to do.

You know, just to, again, quantify it, when we look at 400-ish kilometres of highway that were done, on the surface it sounds great, but just in my riding alone, we have almost 3,000 kilometres of highway. That’s just to put that into perspective. That’s why, I think, I want to see this as a real priority. This is not a political thing. This has to happen for people, just as a way of life now, to get this access.

I appreciate the work. I think at one point, though, as we get down the road on this, it would be great to hear from NDIT directly, especially, Shauna, if you’re able to tell us if they have information that they can share to make this work better as well. If there’s a way to share that with us, that’d be great. I’m just wondering what your thoughts are on that.

S. Brouwer: I’m happy to have that conversation with them. CJ and I meet with the CEO of NDIT probably every two weeks, so we have a pretty good line of communications.

I would say that they haven’t raised anything that we haven’t heard before. As I mentioned, a lot of the decisions that need to be made are policy decisions in the purview of government. So they don’t have many opportunities to actually solve the problems, but they certainly have highlighted them to us, and we appreciate the relationship we have with them as our service provider.

M. Bernier (Chair): Okay, fair enough. Any further questions? Anybody? No?

Okay. With that, maybe I’ll just turn things over to Michael to wrap up before we adjourn. Again, thank you to our witnesses and everybody for coming forward and for all the information. As you can tell, it’s important to all of us, for different reasons, to talk about this issue and to keep highlighting it.

M. Pickup: Thank you so much for the questions today, for the opportunity to discuss the report and to the deputy and other witnesses for the great commentary. It’s very rewarding for us. I will say that we made the decision, strategically, many months ago, that we should continue with this.

Generally, we are in the audit business, and we’re doing audit reports. To do an information report takes us a big pause, to say: is this really what we want to do? Generally, we like that information, of course, to be coming from government itself and to be available in other ways. So we took a pause, and we said that this issue is so important — and people are telling us this issue is so important — that we should continue with an information report, and we should do it quickly to get the issues in front of us.

[8:55 a.m.]

Hearing the questions today, listening to the witnesses and the action that is taking place as a result of this, partially, I believe…. Obviously, a lot of these things you already had underway, but when you talked about the mapping that will come out and some more information that will be available to people — that helps us realize that this was the right decision to do, to continue with this information report.

It also helps people like Amy, Janice and Lisa — who gave up a good part of July and August so that we could get this in front of you and gave up their summertime to be able to get this done. It’s very rewarding for all of us. Hopefully, this report not only helps you as elected folks but, ultimately, will help people across the province, if it helps improve access to the Internet. As I mentioned yesterday, many of us sign up for these jobs to try to help improve the delivery of programs and services.

Thank you so much for the respect and cooperation, and for the questions today as well. A reminder: we have three more reports coming out between now and mid-November.

M. Bernier (Chair): Thanks for the reminder. More important work from the committee to do. Thank you, everyone.

Thank you again, Michael, for all your comments.

Motion to adjourn?

MLA Mercier.

Motion approved.

The committee adjourned at 8:56 a.m.