Government Operations Committee on May 17th, 2007

[Liliane Saint Pierre]

This, of course, is a big “if”. The basis of trade agreements is to promote trade and exchange between countries--

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

I understand that. That's not my question.

If Canada were to adopt policies--beyond those that exist already--to direct trade to Canadian enterprises, would it be fair to speculate that foreign countries and foreign governments would be forced to retaliate against Canadian companies that are bidding for that foreign work?

[Liliane Saint Pierre]

I think it's fair to say that we could expect that there could be some consequences.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Yes, okay. So in the case of the United States, which has procurement that's 15 times larger in dollar value, that might be very risky for Canadian businesses, would it not, if we were to enter into some sort of procurement trade controversy with the American government?

[Liliane Saint Pierre]

I think there's a certain risk there.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Okay.

I think it's something to keep in mind when we see some of the old protectionist flags from the 1960s starting to be raised. I want to make sure we're aware of all the risks involved in that approach.

You say here that 71% of government-wide procurement is done through electronic tendering. Is that through the MERX system?

[Liliane Saint Pierre]

Yes.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

All of it is through the MERX system?

[Liliane Saint Pierre]

Yes.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Okay.

Secondly, Consulting and Audit Canada was eliminated after revelations of hideous corruption, some of which is being studied by the public accounts committee right now. Where is the business that used to conducted through Consulting and Audit Canada being directed now? Is that now being done by Public Works, or has it also been absorbed by the departments?

[Liliane Saint Pierre]

First of all, in terms of Consulting and Audit Canada, the consulting part does not handle any more contracting. If there is a requirement for that contracting to be done by department, it's being done within the acquisitions branch of Public Works.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

You indicate here the $1.4 billion in procurement being done over the $25,000 limit that's being done by operating departments and agencies. Why would we have such a large number of contracts that are bigger than $25,000 done through the department instead of having those processes done through Public Works?

[Liliane Saint Pierre]

Most of the contracts that comprise business volume are related to services. Government departments do have delegated authorities to procure their own services to a certain limit.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

So this is almost all services?

[Liliane Saint Pierre]

Most of it.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Do you have the percentage that is services?

[Liliane Saint Pierre]

Between services and goods that governments departments do by themselves, I will have to verify that.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Actually, I'm looking for the percentage of goods over $25,000 that are procured directly by the departments. I don't expect that it's very much, but I'd just like to know.

[Liliane Saint Pierre]

It's not very much. The Minister of Public Works does have the authority to buy goods, and it's the Minister of Public Works who does delegate up to $25,000 for the goods. For the services, it's optional, and the delegation is much higher and is being provided by....

[George Butts]

Two million dollars.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Okay.

Given that the Consulting and Audit Canada scandal occurred largely with the procurement of so-called services, and given that services are still done largely through departments and not through centralized procurement at Public Works, what are we doing to avoid the same kinds of abuses that we saw at Consulting and Audit Canada from happening at a departmental level, given that Public Works is not in charge of enforcing most of those procurement transactions?

[Liliane Saint Pierre]

There are many procedures and rules and policies that have been put in place. First of all, related to services, through the transformation initiative that the department is leading, it is putting in place a huge instrument by which you will regroup all different types of services, establishing a whole series of rules and procedures upfront. And at that time we delegate the authority to departments, but by delegating that authority we are asking the department to comply with the rules and the process that have been agreed on. This is one of the key measures that has taken place.

Another point that will really help in avoiding such a recurrence is the fact that with the procurement ombudsman, the new role, for services under a certain threshold, enterprises, suppliers, and individuals will be able to complain if there is any abuse. I think that this is a step in the right direction.

[The Vice-Chair, Conservative, Daryl Kramp]

Thank you, Madam Saint Pierre, and thank you to all of our guests for attempting to simplify a mega-mega-billion-dollar responsibility and a very, very complex topic.

[Raymond Simard, Liberal, Saint Boniface, MB]

I just want a clarification on information Ms. Nash asked for. Will you be providing this information on the percentage of American companies getting our procurement of the $12 billion? The opposite as well: how much Canadian companies are getting from American contracts? Can you provide those numbers? Is that what you're asking, Ms. Nash?

[The Vice-Chair, Conservative, Daryl Kramp]

Let's not get into it now. My understanding is that the answer was given by Mr. Moffat at that particular time on that, and which he could reiterate that same—