Government Operations Committee on April 30th, 2009

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

I would like to come back to two points. Let's talk about the network strategy. We know that the 125 or 130 networks used by the different departments are managed. Management of those 125 networks is not a problem, but what happens to the small companies that are currently managing or helping you to manage those same networks, who were hired by the government and were given IT contracts to maintain those networks?

[Liliane saint pierre]

I am not able to discuss the results of the consultation. However, some of our observations have been that these small and medium enterprises are currently offering a lot of technology-related professional services and that they are asking that part of the professional services not be included in the procurement process. At the same time, it is obvious that we need to keep the telecoms hired to repair the network. As a result of these consultations, we will be recommending to the industry that it not include the major… There will be professional services, but not an entire range of professional services.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

Unless I am mistaken, you are giving us a heads-up regarding something that may be problematic…

[Liliane saint pierre]

We will be making a recommendation. We have held consultations. When we hold consultations, we have to review the feedback. After we have done that, we will be making a recommendation.

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

I would just like to point out to you, by way of conclusion, that you referred to prequalification of firms who will replace public servants. I just wanted to let you know that the President of the Public Service Commission told the Committee that she had developed a website that can be consulted by every department in Canada, which costs $7.2 million, and where it is also possible to find potential recruits. That is why we wondered about the Government of Canada's decision to recruit 100 or more outside firms to find qualified staff, when the President of the Commission has already set up a website.

[Liliane saint pierre]

It is very important to point out that for standing offers or temporary help agreements, there are very specific rules that apply. If a secretary or assistant is away one day, they have direct access, for set periods. This does not involve long-term replacements…

[The Chair, Liberal, Derek Lee]

I have two questions, and the first one is for Mr. Connell.

Based on the statistics we have here, the country is awash in SMEs. We have all kinds of healthy SMEs. You have a bird's-eye view. You've been in your present position for half a dozen years. In a general way, would you agree that federal government procurement is important, very important, extremely important, or not important at all to SMEs across the country?

I'm pretty sure my colleagues and I in the House take the view that it is really, really important. But I'd like your view from Industry Canada--and it doesn't have to be a political answer. I hope it'll be an answer from a professional looking across the whole thing. I'm looking at regional economic benefits and the economy itself. How important, generally, in a relative sense, is this field of procurement to our SMEs across the country?

[John Connell]

I would say it's important. Federal procurement is important, particularly to firms in certain sectors of the economy. You will find in aerospace defence that it is a lot more important than in some of the service sectors with which I'm familiar.

The other point I'd make is that we do considerable outreach to small businesses and monitor the work of the associations, the various chambers, the CFIB, and some of the ethnic-based business associations. We also monitor through the Business Development Bank of Canada. It is not an issue that comes up very often, in my outreach to small business.

Some of the issues I went through in the presentation, financing, access to human capital, particularly before the downturn in Alberta or anywhere--that was becoming the number one issue, just finding labour--exporting to some extent, always tax. But sometimes, as I say, in particular sector tables, the issue would be much more pronounced.

Heading over to the percentage of federal expenditures in respect of procurement, Denis was saying relative to total expenditures....

Denis, I don't know whether you have those numbers in mind.

[Denis Martel]

Well, based on the figures we heard from our colleagues at Travaux publics, it's $5 billion, and the government expenditures are about $200 billion, so.... It's important to look at our own operations, which is partially the purpose of the committee, but in the overall picture it is a very small component.

[John Connell]

The only other point I'd add is international benchmarking, so that we stay in touch with peers in other OECD countries and with countries in Asia-Pacific Economic Cooperation. They have various study plans, supported by secretariats. Again, it's not an issue that's particularly coming up in those fora that are dedicated to supporting ministers responsible for small business policy. Ministers will gather from time to time, and I don't hear it in that context.

[The Chair, Liberal, Derek Lee]

Thank you.

Ms. saint pierre, over the last 10 or 20 years, our economy, and many of the developed economies around the world, have found ways to evolve their goods and services supply chains and package them into extremely efficient, well-financed, globalized supply chains. You can get a widget from the other side of the world here in seven and a half days. Much of it is extremely efficient. Some of us have called it the “Wal-Martization” of procurement. I'm sure your department is attracted to that model, because in many ways the business world--the economic world, the financial world--has produced these supply chains, and they're very efficient. But in terms of political representation in the House of Commons, almost every member of the House will be fighting for his or her constituency. So the Wal-Martization doesn't always fly in government procurement.

I know there'd be a propensity in the department to go for what we call the “bundling”, the big supply chain, but can you tell us that your department is, in some ways, resisting that? I know it sees the benefits of it, but is it also going to find ways to make room for small and medium-sized businesses? Tell me that when your department designs its procurement you will resist the tendency to turn everything into a Wal-Mart globalized procurement supply chain.

[Liliane saint pierre]

First of all, I think it's very, very important to keep in mind that we buy on behalf of all the departments, and departments are determining their needs. The strategy we have developed as a way forward in department renewal is that for all of what is commonly bought in large quantities, we are developing strategies, government-wide, on access that, if you look at the results right now, qualify as many firms as possible.

We could have looked at temporary help and said let's go with one or two firms--after all, it's just NCA. But that was not part of the strategy when you look at all the considerations we have. Public Works has a lot to say when it comes to common goods and services.

When you do move into what you call the supply chain...I will give you an example. When the Department of National Defence needs to look at maintenance for its large fleets, at that time you move the discussion to a different level, in the sense that you have to analyze with the department how you get the best value in order to ensure maintenance of the fleet. Then you could lead to a strategy that you have larger contracts related to that and that are more long term.

It is all related to what you buy, the quantity, and the timeframe: tied to social and economic benefits and other priorities of the government within the trade agreements.

[The Chair, Liberal, Derek Lee]

I just wanted to get some of those issues on the table.

As we wrap up this particular meeting, on behalf of colleagues, I want to thank all the witnesses who came today. Your evidence has been very helpful to us. It will be very useful as we try to put together a conclusion and a report on this.

[Liliane saint pierre]

I'd like to conclude by saying that we are looking forward to reading your report. We had an opportunity to review the transcripts, and there has been a lot of good value-added and innovation provided to the committee.

[The Chair, Liberal, Derek Lee]

The witnesses are now excused. Thank you again for attending.

Colleagues, we have some business to take care of, which I hope we can do quickly.

Mr. Warkentin, did you want to address your item first?

[Chris Warkentin, Conservative, Peace River, AB]

Yes. I would like to proceed with a motion. I'm hoping I can have all members support for this.

I move:

That the 3rd Report of the Standing Committee on Government Operations and Estimates from the 39th Parliament, 2nd Session entitled "The Right Pay for Valuable Employees", be adopted as the Second Report of the committee in the current session of Parliament, that the Chair be authorized to table the report in the House, and that a Government Response be requested

[The Chair, Liberal, Derek Lee]

Mr. Warkentin, normally we need notice for a motion of this nature. We can only proceed if there's unanimous consent to deal with the motion.

Colleagues, is there consent to deal with it?

[Diane Bourgeois, Bloc, Terrebonne—Blainville, QC]

For the time being.

[The Chair, Liberal, Derek Lee]

I don't mean to pre-empt Mr. Warkentin, but this particular report of the committee was introduced into the House in the last Parliament.

I won't go through all the facts, but the House did dissolve for an election before the government was able to deliver its reply. The chair takes the view that technically the deadline for the reply did come, but the House dissolved shortly thereafter.

There's some suggestion that the best way to proceed is to simply reintroduce the report and ask the department to provide its reply. If colleagues are prepared to do that, we'll simply re-adopt the committee report as ours and reintroduce it into the House.

Does your motion—

[Chris Warkentin, Conservative, Peace River, AB]

I should make the motion pursuant to Standing Order 109, if that's helpful, or necessary.

[The Chair, Liberal, Derek Lee]

It's the view of the chair that in introducing it we should not make any particular reference to timelines for reply. The government should be aware that this is not a fresh new report that has not been seen before.

If that's okay, we can put the motion.

(Motion agreed to)

[The Chair, Liberal, Derek Lee]

I'll introduce that next week, on Monday, I think.

What was the other item, future business?

Our next meeting on May 5 will be dealing with Bill C-18. That is a very modest, short pension reform bill. I think we should try to get that through the committee as quickly as we can and get it back into the House. I don't see any serious questioning or opposition to the bill. If it's okay with members, we'll begin the meeting with that. If we have time at the end of the meeting, we may be able to go in camera and provide some preliminary instructions to research on the procurement study.

Mr. Martin, on Bill C-18.

[Pat Martin, NDP, Winnipeg Centre, MB]

I only caution that it might not be quite as straightforward as you think. Dealing with the RCMP pension is going to be a bit of a hot button issue, or it certainly could be, given that in the last Parliament the head of the RCMP lost her job over RCMP pensions. There are hugely controversial abuse/misuse allegations.

I know this bill, you're saying, is a housekeeping bill, but two things have changed since this bill was introduced, or this notion of amending it. One thing is that huge controversy, where the woman was hauled up in contempt of Parliament and is now suing the Government of Canada for losing her job over this. Secondly, the B.C. Supreme Court has said that the RCMP should have the right to free collective bargaining. This just happened a couple of weeks ago.

So their compensation and their pension issues are very much controversial right now and in a state of flux, to where I don't think there's anything straightforward about dealing with RCMP superannuation, and we may want to call witnesses to that effect.

[The Chair, Liberal, Derek Lee]

We'll definitely have a witness or two at the consideration of the bill before we do clause-by-clause, but, Mr. Martin, I hope you keep in mind that this is what I understand is a mathematical tweak to the pension calculations. It doesn't have to do with whether or not there is a superannuation plan or not.

It's a very minor administrative tweak, but you will stand advised as to what's relevant and what's not in terms of your knowledge of the envelope. It's the chair's view that there wouldn't be a lot of issues imported on this bill, but members will make their own decisions on that. That is scheduled for that day, and should something arise during that meeting, we'll deal with it as a committee.

As I say, if there is time at that meeting, members may want to take advantage of that window to provide some preliminary instructions--not final instructions--to research staff in the drafting of a report on the procurement study.

As you probably know, the Public Sector Integrity Commissioner, which is the office created by Bill C-2, the accountability act--it has been often referred to as the whistle-blower mechanism--has tabled her report. That is referred to our committee. In addition, her main estimates are before us. I think we should schedule a meeting to deal with all of those things, including our plans and priorities. If members feel otherwise, they should speak up now; otherwise, we'll build it into a future meeting.

[Some hon. members]

Agreed.