Bill C-227 (Historical)

An Act to amend the Department of Public Works and Government Services Act (community benefit)

This enactment amends the Department of Public Works and Government Services Act to provide the Minister with the authority to require an assessment of the benefits that a community derives from a construction, maintenance or repair project.

Business of the House

[Kevin Lamoureux, Liberal, Parliamentary Secretary to the Leader of the Government in the House of Commons]

Mr. Speaker, there have been consultations among the parties and I believe you will find agreement for the following motion. I move:

That, notwithstanding any Standing Order or usual practice of the House, the Order for the consideration of report stage of Bill C-227, An Act to amend the Department of Public Works and Government Services Act (community benefit), standing in the Order of Precedence on the Order Paper, be discharged and the Bill be withdrawn; that Motion M-109, standing in the Order of Precedence on the Order Paper, be withdrawn; that the recorded division currently scheduled to be held immediately before the time provided for Private Members' Business on Wednesday, February 1, 2017, and any further recorded divisions deferred to that day pursuant to Standing Order 93 or 98, be held instead at an expiry of the time provided for the Government Orders that day; and that, immediately following the taking of any deferred recorded divisions that day, the House shall begin adjournment proceedings pursuant to Standing Order 38.

Transport, Infrastructure and Communities

[Judy Sgro, Liberal, Humber River—Black Creek, ON]

Mr. Speaker, I have the honour to present, in both official languages, the seventh report of the Standing Committee on Transport, Infrastructure and Communities regarding Bill C-227, an act to amend the Department of Public Works and Government Services Act (community benefit) with amendments.

[Alain Rayes, Conservative, Richmond—Arthabaska, QC]

Yes, Madam Chair. I have my thoughts back in order. However, every time I hear things, I get shivers.

You say you do not want to make the job harder, you do not want to create pressure, it will not be the Minister making the decision, and you want to simplify the process to help small and medium-sized enterprises. I hear all that. However, in Bill C-227, which is what we have before us, it clearly says: "The Minister may" and "A contracting party shall, upon request by the Minister, ... ."

In my view, this bill gives the Minister the power to decide whether or not she wants to request information. As I understand it, however, the officials could decide by themselves and would not always be required to go to the Minister, so as not to complicate the system.

I am hearing two different things from my colleagues. It varies from motion to motion and from provision to provision. When it suits, they agree to it, but if it does not suit, they reject it.

I am finding it hard to imagine how this could be requested afterward, when you already have full power to request this in your tenders. Forgive me, but I am still trying to find out what more this bill will add to the power you already have at present. I really feel like I am hearing what my constituents say to me in my riding. I am trying to defend the officials, because I think there are excellent, effective people in the government bureaucracy, at all levels. Unfortunately, I really have the impression that this kind of bill adds more bureaucracy to the machine. I completely fail to see what more this is going to give you.

That being said, this is not really a question. I realize that it is more of a comment.

[David Schwartz]

That is an excellent question.

We are going to prepare a proposal, which will be considered by the Minister. As I mentioned earlier, we have to avoid having this cover contracts with very small values. As far as determining the threshold, in this case, we shall see.

The criteria that will determine what types of contract will be subject to Bill C-227will be transparent and clear. I hope that members of the committee will be reassured in that regard. We do not intend to consult the Minister or her office on each contract, to verify whether that condition will be imposed. We will have criteria that will, in fact, be transparent to the public.

We are in the process of developing those criteria. We are not far enough along to say that it will apply to contracts for a particular amount of money or to particular industries, or that particular benefits will be required.

[The Chair, Liberal, Judy Sgro]

As soon as we finish with C-227—

[The Chair, Liberal, Judy Sgro]

All right.

Does everyone have the information they require in order to participate on C-227? I have no one on my list, so I'm going to move to clause-by-clause, if that's acceptable to the committee.

(On clause 1)

We have Mr. Aubin's amendment in front of us, replacing line 8 with “benefit means a social, economic or environmental benefit”.

Does everyone have the amendments in front of them?

Do you have them, Mr. Clarke?

[David Schwartz]

I would like to clarify that Bill C-227 does not require that enterprises hold consultations.

[David Schwartz]

I do not think so.

As I said in my presentation, we are not asking bidders to provide information about community benefits in the invitation to tender. We will do the evaluation of the various bidders, and the one we award the contract to is the one that will have to provide the information about those benefits; it is the one that will do an assessment once the work is completed.

For small and medium-sized enterprises, as I said earlier, we will establish criteria, because that requirement does not necessarily affect all projects. The bill enables the Minister to apply that measure in Bill C-227. In the case of a $150 plumbing contract or a $1,000 building or repair contract, I do not think it would be necessary to ask those enterprises to say whether their work provided community benefits.

We will establish criteria for determining what type of project an enterprise will have to comply with that for, and starting at what amount. I think that will enable us to reduce the risk of imposing an administrative burden on small and medium-sized businesses.

[Vance Badawey, Liberal, Niagara Centre, ON]

I want to dig a bit deeper here because Bill C-227, I think, is a wonderful first step. I think it's a good direction to take but I think we all agree around the table, from the past discussion that we've had, that there's a second, there's a third, and there's a fourth step attached to this, especially as it relates to those performance measures with respect to the bidding process and getting added value. Again, the municipalities do it all the time. There are millions of dollars that can be realized here, when bidding is happening, with respect to the added-value products that they add into their bids.

With that, I want to go to Mr. Hardie's earlier question. How then, after the fact, do you measure that performance? When Bill C-227 is put in place, how is the federal government now going to measure that performance based on what this bill actually defines as part of the overall process?

[David Schwartz]

On the challenges, I can only speak on behalf of PSPC, with respect to its scope and application. As soon as the bill is passed, we would be applying it to all PSPC contracts that fall within this scope. With respect to including it as rated criteria or mandatory criteria, unfortunately, the current structure of our trade agreements prohibits us from including it as rated criteria.

In discussions with industry, we haven't discussed Bill C-227, but we've discussed a number of things—prompt payment, good-quality design documents, a host of things—and I made reference to that collaborative relationship that we have with CCA, or the NTCCC, which is another organization. I think this legislation has the opportunity to clearly signal government intent, and that signalling, I think, could potentially cascade down.

[Vance Badawey, Liberal, Niagara Centre, ON]

That's what I'm getting at, Mr. Schwartz. Yes, we have Bill C-227 in front of us, and it is essentially a good first step, but what I'm getting at now is the second, the third, and the fourth step as this matures and as it accrues over time.

What I mean by that is that, in my opinion—and I'm sure we share this opinion around this horseshoe—this will in fact add value to the process. I think for the most part it can be applied to not just the federal level but it can be a discipline when monies are flowing from the federal level to municipalities, and quite frankly, to the provinces.

Second to that, and, again, moving down the road.... Coming from the municipal level as a former mayor, like my colleague opposite, we had been doing this for quite some time. What it did was, before the actual process was bid, it was actually part of a matrix and it was part of a waiting process on that matrix, and therefore, part of the ultimate bidding award because of the value-add that can be attached to it.

Therefore, when you're now moving forward with meeting a hopefully aggressive timeline with respect to Bill C-227, do you see that discussion happening in the future as well?

[Vance Badawey, Liberal, Niagara Centre, ON]

Thank you, Madam Chair.

At this point, if Bill C-227 were to pass, how would the department adapt its processes to accommodate the intent and the reality of this new legislation?

[David Schwartz]

To begin with, I would like to clarify something.

Bill C-227 requires that in our requests for proposals, information about community benefits be provided. It is important to note that it is not talking about including a community benefits requirement. That is not a mandatory criterion for deciding whom to award the contract to. It is simply about providing information on community benefits. I want to be sure that the members of the committee understand that that is not part of the evaluation for deciding whom a contract will be given to.

[The Chair, Liberal, Judy Sgro]

If it's all right with you, let's hold it until we finish with Bill C-227, and then we'll deal with this. Then we'll go in camera to deal with other business.

Is that all right, Mr. Berthold?

[David Schwartz, Director General, Commercial and Alternative Acquisitions Management Sector, Public Services and Procurement Canada]

Good morning, everyone.

Madam Chair and members of the committee, hello. I would like to thank you for giving me the opportunity to answer your questions concerning Bill C-227.

My name is David Schwartz, as the chair mentioned, and I am the director general of CAAMS, the commercial and alternative acquisitions management sector, with Public Services and Procurement Canada.

My sector buys goods and services and manages construction contracts amounting to over $7.5 billion a year on behalf of federal government departments and agencies. We buy from suppliers around the country.

The operation of government-owned facilities and construction contracts represent the top two commodities that my sector procures. Together, they represent $5.4 billion of the $7.8 billion in procurement we have averaged over the last three years. The services deal with government-owned facilities and construction contracts. The services that we procure include architecture and engineering, construction and maintenance, as well as property management and project delivery.

Today we leverage Government procurement so as to provide economic opportunities and community benefits across the country. Over 72 per cent of the business volumes for contracts awarded by my sector goes to small and medium-sized enterprises.

The majority of construction contracts awarded by PSPC in a particular region go to suppliers located in that region. Communities are currently benefiting from government procurement. Taking the figures from the last three years, we see that 93% of construction contracts awarded in the Atlantic region went to suppliers located in the Atlantic region. That figure was even higher in Ontario and Quebec, at 98%.

Public Services and Procurement Canada is supportive of the objectives of Bill C-227. Public Services and Procurement Canada manages close to $15 billion in procurement on behalf of federal departments and agencies. Those procurements provide economic opportunities and community benefits across the country. Close to 40% of our overall procurement business goes to small and medium-sized enterprises.

With respect to the bill, in order to reduce the administrative burden of having each bidder submit information on the community benefits their respective proposal would provide, the proposed planned approach would be to only require the winning bidder to provide that information and to do so before contract award. A standard clause could be developed and inserted into RFPs issued by PSPC to place this requirement on bidders. Collecting the required information will build departmental knowledge of the community benefits that accrue from federal procurement.

Thank you for your time and attention. We would be pleased to answer your questions.