Finance Committee on May 6th, 2019

[Crawford Kilpatrick]

If I could add to that, I do agree that.... Ontario is the only jurisdiction in Canada at this point in time that has legislation related to prompt payment. Nova Scotia is actually moving forward and is introducing legislation as well, which is at a very high level.

The national construction entities that we have been engaged with have really been looking to us to demonstrate federal leadership to develop prompt payment timelines and look at a dispute resolution process through adjudication, which can be closely followed by provinces and territories when they determine that they are prepared to move forward with similar types of legislation.

During the national engagement process, it was made very clear. There was a theme that came out saying that the construction industry would like to see alignment between different jurisdictions. What we have done is we have worked with the construction industry and looked at what was done so far in Ontario through legislation. Also we've looked at the recent pilot projects in Quebec and incorporated certain aspects of those into our legislation, so that we are hoping to get as much alignment as possible to make it easier for the industry to understand prompt payment rules, terms and the dispute resolution process.

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

Thank you.

[The Chair, Liberal, Wayne Easter]

Mr. Dusseault.

[Pierre-Luc Dusseault, NDP, Sherbrooke, QC]

I'm trying to see the balance that I hope was achieved. On the one hand, there's the matter of prompt payment for the work and, on the other hand, adequate performance of the work in compliance with the conditions established when the contract was awarded.

Which mechanisms were used to ensure that the projects were completed on time and done properly? I can cite examples of major projects, such as the Champlain Bridge, which aren't always completed on time and must meet a cost condition in particular. We know these projects can prove to be bigger than initially planned.

What balance has been struck, having regard to the respect that taxpayers are owed? They're the ones who have to pay for the work, and they hope to see the expected result on a timely basis.

[Christopher Meszaros, Senior Counsel, Department of Justice]

The protections are not really found in the act per se. This is mostly prompt payment legislation. The protections you are looking for and seeking for the members of the public are mostly found in contract. Therefore, we need to have very robust contractual clauses that we implement in the situation of the new bridge on the St. Lawrence to ensure that the completion is done promptly and that it's good value for citizens.

[Crawford Kilpatrick]

What happens currently in the industry is that organizations will increase their rates knowing that they are not going to get paid promptly by the contractor above them or the contractor above the contractor, so there is a financing cost. The legislation very clearly outlines, when work is done for the federal government, that the government has 28 days to make a payment to a prime contractor. That prime contractor then has seven days or a cumulative total of 35 days from when that invoice was provided to the federal government. It's very clear that payments will be made within a certain timeline. That will hopefully ensure that companies down the payment chain will not have to add additional financing costs into their bids for the government, so the costs should go down for the delivery of our federal projects.

[The Chair, Liberal, Wayne Easter]

There are no further questions.

Thank you very much for your presentation. That concludes the time with officials.

We have a small piece of business. There's a sheet handed out. We do need a budget for the subject matter of Bill C-97. The amount requested is $53,900. Does somebody want to move that?

[Francesco Sorbara, Liberal, Vaughan—Woodbridge, ON]

I so move.

(Motion agreed to)

[The Chair, Liberal, Wayne Easter]

We will see everyone tomorrow at 11:00 a.m. for witnesses.

Thank you very much.

The meeting is adjourned.