Government Operations Committee on March 3rd, 2009

[Greg Rapier]

Our association specifically has not dealt with them, but many of the members have dealt with them, both in Quebec and in the industry as a whole.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

You came to tell us that the way in which contracts are presented caused a problem, and that PWGSC has changed the way of presenting requests or tenders. Have the small and medium businesses that you represent been able to work with the Office of Small and Medium Enterprises to deal with those changes?

[Greg Rapier]

They've had the opportunity to work with them. Whether the individual companies have chosen to or not, I wouldn't know specifically. Certainly through the Office of Small and Medium Enterprise's participation in the GOFAC committee and BIFMA's communication to our industry, they are all aware of the office and the opportunity to make use of its services.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

OK.

Ms. Miller, were you aware of Public Works' changes to contract offers?

[Shereen Miller, Director General, Small and Medium Enterprises Sector, Acquisitions Branch, Department of Public Works and Government Services]

Are you asking me if I am aware of the details?

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Yes.

[Shereen Miller]

The Office of Small and Medium Enterprises does not make procurement requests.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

I know, but you are supposed to help small and medium businesses get more government contracts. When the government makes changes to its contracts or its tendering, you should be aware of that and pass it on to the small and medium businesses. Mr. Rapier has just told us that changes have been made to contracts in the furniture industry, in information technology and in biotechnology.

Were you aware of those changes?

[Shereen Miller]

The changes were discussed at the Government Office Furniture Advisory Committee—or GOFAC—on which we have a representative. So we participate in the discussions between the industry and Public Works on procurement, but the purchasing process is not our responsibility. Our role is rather to help small and medium businesses to become involved with government procurement.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

OK.

I am going to talk to Mr. Masse first and then to Ms. saint pierre.

Mr. Masse, page 14 of your document refers to challenges made to the Canadian International Trade Tribunal. Does PWGSC comply with the tribunal's decisions?

[Normand Masse]

Not many challenges have been upheld. When recommendations are made, the tribunal's decisions are considered, in most cases, and measures are taken to comply with the conditions.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

You say “in most cases“. Under what circumstances would you not comply with tribunal decisions that go against you?

[Normand Masse]

If a contract has already been awarded and it is too far along, we could decide to negotiate a settlement rather than to terminate the contract and start the process all over again. Usually, if the contract is already being executed, the tribunal considers that. Possibly, a contract may have been put into operation quite quickly. If that is so, it might be said that it is impossible to fulfill the conditions.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

OK.

Ms. saint pierre, thank you for being here.

Is there a policy of bundling contracts at Public Works? How about that for a good question?

[Liliane saint pierre]

Mr. Chair, Madam, when we are developing a procurement strategy, we consider a number of factors, the first being an analysis of federal government needs.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Excuse me, Ms. saint pierre, I am sorry to cut you off. But I just want to know if there is a policy of bundling contracts. There is a difference between consolidating purchases and bundling contracts.

[Liliane saint pierre]

I am not aware of any policy on consolidating purchases.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Fine. So if there is no policy on consolidating purchases, explain to me why, in two, or maybe three, years, you have gone from 40 furniture suppliers to 5. In information technology, the number of suppliers has been significantly reduced. Explain that to me.

[Liliane saint pierre]

Mr. Chair, Madam, let me go back to your examples. You correctly mentioned that, for free-standing and office furniture, we once had 40 suppliers and the number has dropped. This is the reason. After analyzing the needs of the federal government, and having listened to representations from the private sector and the clients, we worked with industry to come up with an approach. The problem that we had previously was that any company seeking a tender, a deal with the government, could have access to that tender. As a result, we could receive 40 or 50 of them. It is not just furniture. It cost the bidders effort and money, and there was no need. Following that analysis, we proceeded to develop procurement methods with specific needs and specific analysis.

In the case we are discussing, with the 40 furniture suppliers, we did not limit the number of tenders, we limited the number of products. Ten companies qualified, five regular ones and five Aboriginal ones. When we made the [Note to Editor: inaudible] just beforehand, before the new approach, 20 companies qualified. After the competitive process, 18 companies qualified. So we did not limit the numbers as part of the procurement process, we evaluated them against required criteria.

[The Chair, Liberal, Derek Lee]

That would be time. Merci.

Mr. Warkentin, for eight minutes.

[Chris Warkentin, Conservative, Peace River, AB]

Thank you very much.

I want to get some clarification on some comments you made, Ms. saint pierre, in terms of the businesses that receive standing orders for furniture. My understanding, from the testimony I heard this morning, was that it moved from 36 to five. I think I just heard from you that it moved from 36 to ten.

Could I get some clarification on what we're looking at in terms of folks who were successful in their standing offers?

[Liliane saint pierre]

Regarding the free-standing furniture, in accordance with the numbers provided to me, in the past we had 27 standing offer orders. As a result of the competitive process, we awarded five standing offers to companies, plus five aboriginal standing offers, for a total of ten.

For your information, nine of the ten are Canadian firms, and eight of the ten are small and medium-sized businesses.

[Chris Warkentin, Conservative, Peace River, AB]

Mr. Rapier, that testimony was a little bit different from what you provided to us this morning. Is there a clarification that you've received, or do you have a dispute with those numbers?

[Greg Rapier]

No, we don't have a dispute with the numbers. The aboriginal entities are only eligible for a standing offer contract if it's a complete mirror of the underlying manufacturer's contract.

Fundamentally, five manufacturing entities have been awarded contracts. Then in order to provide procurement opportunities under PSABA, five aboriginal entities hold a contract that is identical to the manufacturer's underlying contract just held by the aboriginal distributor.

[Chris Warkentin, Conservative, Peace River, AB]

Anybody can answer this.

Am I to understand that the aboriginal contracts or the standing offers have not been offered to manufacturers but simply to retailers? Is that a correct analysis?