Government Operations Committee on Feb. 26th, 2009

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

That's fine, we can set that aside.

We received a great many letters from other kinds of suppliers, for example suppliers of pharmaceutical products, and producers of furniture and materials for National Defence. To my knowledge—and I went back to 2005— our small and medium enterprise people say that Public Works and Government Services Canada's procurement process is a problem. I know that committees have been struck among the various business groups and PWGSC in order to encourage discussions.

You said earlier that you had indicated to us that major contracts would be awarded. Were you consulted before this decision was made?

[Jeff Lynt]

As I said in my opening remarks, PWGSC deems its process to be a consultation. We do not believe that what has transpired was a consultation whereby we actually had an opportunity to have a dialogue, propose solutions, understand the problem, and know exactly how to get through some of the issues. Some of the dialogue we're just having here today. We don't get an opportunity in a formal manner to have those types of dialogue with PWGSC.

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

How did you learn that four major contracts worth around $20 billion each were to be awarded?

[Jeff Lynt]

The first we learned of it was when we learned there was an RFI that had gone out on MERX for a GENS, which is a “government enterprise network services” contract. Steven Poole, who at the time was the CEO of PWGSC's ITSB, did a presentation at OCRI, which is the Ottawa Centre for Research and Innovation, and proposed that there would be four pillars, all worth upwards of $1 billion each for contracts of, at the time, 15 to 20 years.

We were absolutely floored. His response to us was that we should form consortiums together to bid on these contracts, and that otherwise, we were out of luck.

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

Therefore, the decision had already been made. This gentleman arrived, announced it formally during some kind of meeting, but no one went to tell you. You were not consulted.

Could you give me an idea of the long-term repercussions, more or less, of the loss of these contracts with the Government of Canada for small and medium enterprises?

[Jeff Lynt]

First of all, we think the repercussions for the Canadian taxpayer would be phenomenal. We believe that, number one, these bids will be “price to win”. The alternative would be unthinkable for these companies. If they lose the contract, they'll be out of business for 20 years, so they will price to win.

Once they get in, there will be downstream proposals to increase costs. We believe the taxpayer will ultimately be held accountable to pay more money. We believe that small businesses will be usually affected. We said at the last committee that roughly 5,000 families would be affected by this move. We believe that a number of employees—

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

Five thousand?

[Jeff Lynt]

Five thousand, yes. We believe that the large companies would indeed gobble up some of our employees, and some would have to move into something else. We also believe that a certain capacity of the work may be offshored.

[The Chair, Liberal, Derek Lee]

Madame Bourgeois, I'm going to let you continue, but you'll be using up additional time. You've gone past your four minutes. Your bonus time is gone; now you're into.... If you wish to do that, members will probably accept that you finish off this line of questioning. If you don't want to finish this line of questioning, we'll go to another member.

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

If there is any time left, could I ask some questions at the end? We are here until one o'clock. Do you think I will have any time left to ask questions?

[The Chair, Liberal, Derek Lee]

It looks, mathematically, as though you would have another turn. I can't promise it; I don't know how the rest of the rounds will go.

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

How much time do I have left then?

[The Chair, Liberal, Derek Lee]

If you deduct the time I just spent interrupting you, you probably have between two and three minutes.

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

My question is for the representatives of CABiNET. I will speak to Mr. McGrath later on. You lose nothing by waiting, Mr. McGrath.

I'm speaking to the people from CABiNET. What you have said to us here today is extremely important. Earlier on, I told you that you were not the only ones concerned. Pharmaceutical products, and the office furniture sector have been needing assistance for a long time.

Did you attempt to meet with the authorities from PWGSC and try to understand what motivated their decision? Did you make any efforts to open a dialogue? If so, what did you do?

[Jean Thivierge]

Yes, we tried to open a dialogue. There were several attempts from our side. On the surface of it, one might believe that Public Works is interested in a dialogue. At the outset, that would seem to be the case, but as we continue, we quickly realize that the solution has already been determined, for example with shared services. There is a pre-established goal.

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

The decision has already been made?

[Jean Thivierge]

It has already been decided. Therefore, the dialogue appears to us to be more of a public relations exercise at that point in time.

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

You say the decision was already made. You were not consulted as to what would be purchased and the way it would be procured? Were you presented with any plans? Were there any?

[Jean Thivierge]

Yes. There was a presentation and a consultation, but with very little hard information. It was a PowerPoint presentation with words here and there. On the other hand, there were no real figures, no real solutions to the problem we were trying to solve. During the consultation process, we were asked to suggest solutions. It is incredibly difficult to suggest any solution to a problem that is not well-defined.

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

What was the deadline for you to present your case?

[Jean Thivierge]

It has passed. It was in mid-February.

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

What is over?

[Jean Thivierge]

The consultation took place. It was a 45-minute presentation. Each industry, each group, had 45 minutes. However, you must understand that it is very difficult to define the problem. If you cannot define the problem, it is hard to propose a solution.

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

What will happen over the next while?

[Jean Thivierge]

We received an email, which I mentioned earlier on. Public Works will establish a business plan by the end of March. It is a business plan that will contain no real data, that follows up on consultations that were really very general presentations. At that time, the business plan in question will have to be sent in.