Government Operations Committee on May 27th, 2008

[Shahid Minto]

Madame, there are four issues that have been raised.

Just on the first one, I was an auditor for 28 years. One of the first things you develop as an auditor, and then it gets better as time goes on, is a very thick skin. I don't take any of these things personally. Thank you; there are no problems there at all.

[Raymonde Folco, Liberal, Laval—Les Îles, QC]

I just wanted to make sure of that.

[Shahid Minto]

I'm quite used to that. I've appeared before these committees many times, so there's no problem.

On the limitations, as I said, the limitations are in the Federal Accountability Act. There's not much we could do with it, but I'll tell you what we did do. If you go back to the first draft of the regulations that were published, which was back in December of last year, you will find that the first draft said--and I'm only giving you one example of the many comments put in--suppliers had only 10 days after the award of the contract to lodge a complaint. We looked at that and said that may work for large companies that have legal people, that have finance people, that are always monitoring this, but for the small companies that have only a handful of people, how is this practical? One of the suggestions we put in and fought very hard for was that this 10 days should be extended to a minimum of 30 days. After the 30 days, if there is some event beyond the control of the supplier, then I should have the jurisdiction to extend it another 90 days. The government accepted both of these recommendations.

A lot of the comments we put in, in response to the regulations--we had a volume of comments--were designed to say that given the inherent limitations that Parliament has imposed here, how do we make this more friendly for small businesses? That was always in our minds. That's one example.

There were so many other examples where we simplified the information required and the rest of the things.

For the SMEs, certainly we're aware that for the contract award part of our mandate, they are our main stakeholders. For contracts under $25,000 and under $100,000, they will come to us. We have developed a technology whereby if somebody wants to complain to us, they can, of course, (a) walk in if they happen to be here, (b) use the 1-800 number, (c) use the website, which has a form they can fill in very easily with two clicks, and they can send us in the information, or (d) they can send us an e-mail. We will get back to people within 24 hours.

[Raymonde Folco, Liberal, Laval—Les Îles, QC]

How do they know you exist?

[Shahid Minto]

That's the thing. We have now developed an outreach program. The reason you haven't heard about it is simply that we couldn't put it out until the regulations were there. We are going to use the services. Let me be quick. Members of Parliament, you are all going to get little booklets in your offices about the services of the Procurement Ombudsman, which we hope you will send out and your staff will use to deal with it. That's my number one thing.

Second, we are going to the business associations and sharing all these booklets with them.

Third, we are going to be participating in a lot of industry conferences, putting out articles and magazines in a lot of industries. I have been speaking extensively in a lot of association meetings, so we have a very comprehensive program. I'm not going to call it advertising, but we have a knowledge program for people who don't know where to go or how to do it. We are linked to the Canada website. We are linked to the website for Treasury Board. We have links on the website of Public Works. So it's two clicks and you're onto our website. The site we're creating, which will be fully operational in a week, will be very user friendly.

Now, for the immigrant community--and I'm one of them, so I am sensitive to that--we will work with OSME. There is a group in Public Works called OSME, and they have a lot of regional presence. We do not have regional offices. The way we work with them is that when they do their presentations, we would like them to share with their constituents the information about our office. They will be handing out some of our pamphlets, and--who knows--we may go and speak at some of their functions. If there are immigrant groups, business groups, or other groups that are having some functions, I'd be delighted to go and speak to them. We're very much conscious of this outreach thing. We really want to do it. We want to go out and deal with these groups.

[Raymonde Folco, Liberal, Laval—Les Îles, QC]

Thank you so much.

Can I just ask you what OSME is?

[Shahid Minto]

It's the Office of Small and Medium Enterprises. It's part of the acquisitions branch in Public Works.

[The Chair, Liberal, Diane Marleau]

Thank you very much.

Madame Faille.

[Meili Faille, Bloc, Vaudreuil—Soulanges, QC]

Currently, very small enterprises do not necessarily belong to people who can afford to spend vast amounts of time on the awarding of contracts. If they do not get a Public Works contract, life must go on and they have to look for other contracts. Time is money. Indeed, arguing or trying to find out why an application was not accepted takes an enormous amount of time.

We know that going to the Canadian International Trade Tribunal is very expensive. Small companies are not likely to come before this tribunal, this is done by companies looking for bigger contracts. They can resort to it when there is a clear case of injustice and when they are sure to win.

Are you ready to receive complaints as of now?

[Shahid Minto]

The answer to the last question is absolutely. We've been prepared to receive complaints from the 1st of May. The legal limitation on that is that the issue about which you are complaining must have happened after the 1st of May. The government did not backdate it; it's a forward-looking act. That's one part of it.

The second part of this is that I can't comment on the CITT expense. The CITT will be here, I'm sure, and they'll talk about it.

But can I just emphasize two things about our services? One, there is absolutely no fee for our services. We do not charge for doing a complaint investigation. So there is no charge for coming to us to lodge a complaint. Second, there are no lawyers required and no legal fees. There is nothing in our business model that requires anybody to bring a lawyer with them. I have nothing against lawyers; I have a degree in this area. All I'm saying is that would complicate and make the process long and expensive, and that's not part of it.

For long-drawn-out complaints, we will offer an alternative dispute resolution mechanism in which you don't have to go to court and have a long-drawn-out process. And we're hoping that both the supplier and the government will take us up on this.

[Meili Faille, Bloc, Vaudreuil—Soulanges, QC]

Fine.

You say that there are no costs. I understand that this is a service that you want to offer. The problem for the small companies is time. Time is money, and the time they will spend in explaining and debating their case will not be available for getting other contracts. For contracts under $25,000, will the government delay its awarding of the contract during the time it takes for your office to deal with a complaint?

[Shahid Minto]

Let me explain and clarify this again.

There are two sides to the contract. The people have signed legal obligations here. And let me just be very emphatic about this: we are not lobbyists for suppliers. We are not apologists for the government, but we are not lobbyists. We have to look at it very neutrally, because this is a legal paper that you have signed. There are rights and obligations on both sides, and just because you didn't get a contract and somebody else did, it doesn't mean that there was some problem with it, that there was some hanky-panky with it or something underhanded about it. Somebody has to win and somebody has to lose. The nature of the business is that whoever loses will always have a complaint, so we will deal with it very neutrally. Perhaps the complaint is based on very good grounds and perhaps it isn't, and we will look at it from that point of view.

[Meili Faille, Bloc, Vaudreuil—Soulanges, QC]

I imagine that you have begun planning the review of certain departments. Do you have any indicators? I am trying to understand the famous 2007 budget contract from the Minister of Finance, where the method of awarding many contracts below $25,000 was used. Ultimately, the department awarded a $122,000 contract for the drafting. How will you go about monitoring the different departments and ensuring that this situation never occurs again? What data do you exchange with the different departments?

[Shahid Minto]

This is a very important question and a very interesting question intellectually.

Part of the problem we face is trying to get information from government on how many departments issue what kinds of contracts, who's under $25,000 and who's over $25,000, who is sole-source, who issues an ACAN, and who does what. Everybody has to ask really careful questions here, because the information you get back can be on a fiscal-year basis, a calendar-year basis, or, if the last 20 months look good, you could get a 20-year thing. So it depends on who you ask and what you ask about. It's very precise.

The government has a lot of databases that we are clued in to. Right now we're in the process of analyzing those databases. The Department of Public Works has done this as part of the way forward. We are now also looking at it from our own point of view to see who's done that, and we will monitor the trends. Our selection of which contracts and practices to look at will be based on a number of considerations: known problems, interest to parliamentarians, our own experience with them, and the statistics we get out of the procurement activities.

We're going to put those criteria on our website for everyone to see.

[The Chair, Liberal, Diane Marleau]

Thank you very much.

I want to make sure everybody knows that some representatives from the CITT will be appearing before this committee on Thursday. So we'll be able to ask them those questions that you haven't been able to answer.

Mr. Albrecht.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

Thank you, Madam Chair.

Thank you, Mr. Minto, for being here today.

I applaud your wisdom in not addressing the political issues that have been raised a number of times today.

I want to comment to the other side that these regulations were registered in the Canada Gazette on December 22. There were all kinds of opportunities for input. If there really was the kind of interest there should be in this legislation, they would have raised their concerns at that time.

I'd like to go back to the differences between the CITT and the ombudsman in terms of what they're going to be looking into. The CITT has existed for a number of years and has always had the ability to look into disputes over $25,000. We're now finally getting a system in place that will deal with those that before had no method of being addressed unless they wanted to enter costly litigation processes. It's important for Canadians to understand that.

Can you tell me roughly how many contracts fall under the $25,000 range? Do you have a guesstimate in terms of numbers, or perhaps a percentage?

[Shahid Minto]

I've seen various numbers. We haven't validated any of them, but we're talking about hundreds of thousands--not 10,000 or 20,000. We're talking about $1 billion to $2 billion worth. The majority of the contracts issued by the Government of Canada are for under $25,000--in that range. The dollar value, of course, is much smaller. But individual transactions--things that affect the majority of Canadians on a day-to-day basis--are in there. They're very much a part of my mandate.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

So there's the potential for a pretty huge workload on your part, with the number of contracts being awarded, not necessarily the dollar amount.

[Shahid Minto]

There is the potential, and our challenge is to do really well in our practice reviews. It's a bit like health care. You can either put a lot of medicine and money into fixing people's symptoms or you can say, “You should be exercising more, eating better, and doing more prevention”. We'd rather put a lot more money into the prevention part. If we can get that right, there should be much fewer reasons for people to complain. That's the balance we want to bring.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

During one of your responses to a question, you mentioned that you're open to going out and speaking to business groups, and so on. Would you be willing to speak to the Chamber of Commerce?

[Shahid Minto]

I'd be absolutely delighted to talk about our mandate.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

I think there's a large gap in knowledge for many small and medium-sized enterprises in terms of even knowing they have accessibility to government contracts. So it would be good.

[Shahid Minto]

A large part of our mandate is to prove the transparency of government procurement. The way to do that is to simplify the government processes and explain to people that things they think are complicated may not be that complicated. There is a better way. I'd be very delighted to contribute.

[Harold Albrecht, Conservative, Kitchener—Conestoga, ON]

I was very pleased to hear you say that as you work through the process and your input, your primary goal at all times is to make it easier for small and medium-sized enterprises. That is your number one goal, and that's to be applauded. Thank you very much for that.

[The Chair, Liberal, Diane Marleau]

Thank you.

Madame Bourgeois.