Madam Chair, thank you very much. Thank you for the opportunity of appearing here today. I hope the issues I raise will be of interest to you.
This is about a contract called ETS at Public Works. When the ETS RFP was issued in 2006, we were very concerned—even though we had been doing the work for over seven years—that the RFP was structured so that we could not bid, because of project references that were included. At the time we thought it was just an oversight, but in retrospect it now seems to have been a deliberate attempt to prevent us from bidding.
We have three concerns related to the evaluation of the RFP. These are the lack of a fairness monitor, the apparent conflicts of interest, and irregularities in the technical scores. The lack of a third party fairness monitor for this procurement is an issue, and it was discussed here a few weeks ago. This was a violation of PWGSC's own fairness monitoring policy framework, and it certainly didn't match their stated objective of ensuring fairness in procurement. So I think that's a big concern for us.
The second concern relates to the code of procurement, which states that if there is even an appearance of a conflict of interest, then those involved should remove themselves from any decisions involved in that procurement. In the case of ETS, several individuals are in this position: Minister Fortier, due to his previous connections with CGI; Mr. Steven Poole, the CEO of ITSB, the organization within PWGSC that issued the RFP, who was formerly a vice-president of Canada Post and Innovapost, a joint venture that is 49% owned by CGI; and Mr. Jirka Danek, a director general within ITSB and a former vice-president of CGI.
As far as the evaluation itself goes, it's important to understand the results of the RFP. For clarity I will refer to the technical scores used by PWGSC to justify the contract award to CGI as the published scores. There is conclusive evidence that these scores have been tampered with. The authentic scores that were assigned by the evaluation team will be referred to as the legitimate scores. I say this just to keep it clear.
So the evaluation was based on a 65% weighting for the technical score and 35% for the financial score. TPG, my company, was the low bidder and won the financial evaluation. For the published technical scores, CGI was given a high score, nearly 63 out of 65, with IBM three points behind, and TPG nearly six points behind. Due to the high technical score that CGI was given, they were awarded the contract.
Based on the history of government RFPs, these results were very strange, because the difference in technical scores between bidders was so large compared with most RFPs, where they are typically very close.
The evaluation process was completed between September and November 2006. During this period we heard reports that the technical evaluations were very close, with all of the scores being within two points of each other. We also heard that TPG was the winning bidder. Then several events took place that now seem to be very significant. On November 9, 2006, the evaluation was complete. In mid-November 2006, shortly after the evaluation was complete, Mr. Jim Bezanson, the director on the evaluation team, received an unsolicited job offer from Canada Post and left PWGSC shortly thereafter.
Because of the structure of the technical evaluation, Mr. Bezanson was the only member of the evaluation team who knew how the technical scores actually added up. His departure from PWGSC erased the corporate memory of the evaluation team and created a situation in which the technical scores could be changed with low risk of detection. So on November 22, 2006, Mr. Maurice Chenier, Mr. Bezanson's boss, told me that a reconfirmation of the evaluation was going to be done because the results were close.
So then we go to February 2007, several months later. At that time we heard that CGI, and not TPG, was the winning bidder. We also learned that the published technical scores were not close, as we had previously heard, but that CGI had a large advantage over both IBM and TPG.
In March 2007 we had a conversation with Jim Bezanson, who by then had been at Canada Post for three months. Mr. Bezanson told us that the ETS technical scores had been very close, and he was surprised that CGI might have an advantage over the other bidders.
From this information, it was obvious that the scores had been changed after the legitimate evaluation, without Mr. Bezanson's knowledge. We then attempted to obtain documents relating to the evaluation, which would confirm what Mr. Bezanson had told us. We filed numerous access to information requests, several CITT complaints, a complaint with the PSIO, and appeals to the Information Commissioner to obtain the necessary documents. None of these efforts was successful.
Only in the last few weeks, after 14 months of effort in dealing with these institutions, have we obtained the detailed evaluation scores for all bidders. These documents provide conclusive evidence of irregularities in the evaluation process.
In reviewing the individual scores assigned by the five evaluators, we find that the TPG scores do not match the published results at all. Any analysis of the scores assigned by the actual evaluation team shows that the results were indeed very close, exactly as Mr. Bezanson had told us.
The majority of the evaluation team--three out of five evaluators--gave TPG scores high enough for us to win the RFP by a substantial margin. With these high scores, it is impossible that TPG could end up with a published technical score far behind the other bidders.
In looking at the documents, it is obvious how the TPG scores were reduced. There were 217 evaluation criteria. For four or five of these criteria, the published scores for TPG are far lower than they should have been based on the legitimate scores. In one case the legitimate scores were 77, 80, 100, 100, and 100 out of 100, while our published score for this item was 49. This could not be a valid result and is obviously the result of tampering.
The questionable scores made the difference between winning and losing the contract. It is also certain that these low scores could not have been assigned by the evaluation team.
Our issues did not stop at the contract award. The contract was awarded in October 2007. The desire of senior officials in PWGSC to ensure that CGI retain this contract became even more obvious during the contract implementation. Senior officials in PWGSC ignored their legal obligations in implementing the contract by not enforcing many of the mandatory requirements defined in the RFP and by changing other requirements to help CGI. CGI failed to provided the required 159 resumés of the qualified resources who were to do the work. They also submitted the resumé of a TPG resource without his permission, another violation of the RFP terms. They failed to provide the qualified staff at the time of transition as specifically outlined in the RFP. They failed to complete the transition by December 21, 2007, as specified in the approved transition plan.
Immediately after our contract ended, PWGSC implemented a blackout of system changes in order to assist CGI, which was also not in the RFP specifications. In all these cases, the contract with CGI should have been terminated, but senior officials in the department simply ignored these issues of non-compliance.
As it became clear that CGI would not be able to meet the RFP requirements to provide qualified personnel, PWGSC became a recruiting agency for CGI. The PWGSC contracting authority asked TPG personnel to respond to a CGI potential employee form and submit to interviews with CGI. This was not the process defined in the RFP and was not lawful. In spite of our objections, PWGSC management and staff repeatedly contacted TPG personnel and encouraged them to call CGI to seek employment. PWGSC management was fully aware that these actions were unlawful.
Finally, on December 21, the last day of our contract, PWGSC allowed our contract to end with almost no replacement staff available from CGI. This irresponsible action was taken to help CGI subsequently recruit TPG personnel, and it put at risk the interests of millions of Canadians. Whoever made this decision is guilty of gross mismanagement.
In summary, I hope everyone here agrees that misappropriation of $400 million is an important issue, as it is more money than all of the recent procurement scandals combined. Since March 2007 we have asked for an open, transparent, and fair investigation into what happened. The opposition parties have made the same request through press releases and statements. The press has asked for an investigation. The government has refused.
Wrongdoing on the part of some public officials did not end at the early stages of the procurement but continued after contract award. Is filing a lawsuit and spending hundreds of thousands of dollars or more on legal fees the only way to obtain transparency and fairness in our country?
To understand the procurement process and how PWGSC actually operates, the committee will really need to investigate how procurements can go wrong and force transparency where the government has imposed a veil of secrecy.
Thank you.